Wood Boilers LLP & Anor v Gas and Electricity Markets Authority

Where a judicial review claim raises serious delay issues alongside arguable merits and possible remedial consequences, the court may direct a rolled-up hearing so that permission, merits, delay and remedy are considered together. Delay should not ordinarily be determined as a freestanding preliminary objection where its assessment depends on the factual context, the legal merits and the practical consequences of any relief.

A legitimate expectation that a public authority will act in a way later considered ultra vires may nevertheless raise an arguable issue where the alleged unlawfulness concerns secondary legislation. Separately, an expectation linked to a property interest may arguably engage Article 1 of Protocol 1, even though domestic vires principles prevent enforcement of the expected payment or benefit. Just satisfaction may remain an arguable remedy.

The claimants sought judicial review of Ofgem’s decision to cease paying renewable heat subsidies through an approved custodian-account arrangement under the Domestic Renewable Heat Incentive Scheme Regulations 2014. They alleged an unjustified departure from a substantive legitimate expectation and relied alternatively on Article 1 of Protocol 1 to the Convention, seeking restoration of the payment mechanism or just satisfaction.

Ofgem argued that the payment arrangement was contrary to regulation 26, that no legitimate expectation could require an ultra vires act, and that the claim was out of time. The court considered whether the claim was arguable and whether the issues should be dealt with at a rolled-up hearing.

1. Rolled-up hearing. The claim was properly arguable. Serious delay issues required detailed factual evaluation, including events during 2019, the parties’ attempts to resolve the problem, prejudice, the legal merits and the possible consequences for remedy. Those matters should be considered together rather than delay being determined independently at the permission stage. A rolled-up hearing was therefore ordered, following the approach described in Maharaj v National Energy Corp of Trinidad and Tobago [2019] UKPC 5 and discussed in Inclusion Housing Community Interest Co v Regulator of Social Housing [2020] EWHC 346 (Admin).
2. Common-law legitimate expectation. The claim that a legitimate expectation could arise from Ofgem’s clear approval of the payment model was arguable. Although Rowland v Environment Agency [2003] EWCA Civ 1885 and R (Albert Court Residents’ Association) v Westminster City Council [2011] EWCA Civ 430 supported the general principle that public law cannot require an authority to act contrary to primary legislation, the present case concerned secondary legislation. It was arguable that this distinction mattered.
3. Article 1 of Protocol 1. On the arguable premise that the approved payment arrangement generated a legitimate expectation connected with a property interest, domestic vires principles did not necessarily resolve the Convention issue. Stretch v United Kingdom 38 EHHR 196 illustrated that an ultra vires obstacle may still lead to a disproportionate outcome and an award of just satisfaction. It was arguable that section 6 of the Human Rights Act 1998 required the expectation to be respected or that just satisfaction could be awarded even if Ofgem lacked power to make the underlying subsidy payment.
4. Permission and the merits were not finally determined. The court indicated that it would have granted permission on both grounds, leaving delay aside, but directed that the substantive court determine permission, merits, delay and remedy at the rolled-up hearing.