THE GET REAL MARKETING COMPANY LIMITED (R on the application of) v CULTURE RECOVERY BOARD & Anor

A rationality challenge to a decision under a non-statutory scheme faces a high threshold. The claimant must show that the decision fell outside the range of reasonable responses and was manifestly unreasonable. Decision-makers may place the burden on applicants to demonstrate compliance with scheme criteria and are not generally required to fill evidential gaps or conduct further inquiries. Courts should be slow to second-guess decisions requiring specialist financial and sectoral expertise. Administrative aids and consultants’ reports do not bind the ultimate decision-maker unless the scheme makes them binding. A court reviews the rationality of the decision, not whether it would have reached the same factual conclusion.

The claimant, a cultural-sector company, applied for a loan under the Culture Recovery Fund’s Repayable Finance Round Two scheme. Its application was rejected because the Culture Recovery Board was not satisfied that it had exhausted all other reasonable funding options. The claimant sought judicial review, contending that the decision was irrational because it conflicted with its application materials, internal assessment tables and a PwC report.

The challenge was treated as a single rationality challenge. The central issue was whether the Board’s conclusion fell outside the range of reasonable responses available under the non-statutory scheme and its published guidance.

1. Claim dismissed. The decision was subject to the high threshold applicable to rationality review. The question was not whether the claimant had in fact exhausted alternative funding, or whether a different conclusion was preferable, but whether it was irrational for the Board not to reach that conclusion.
2. The scheme was non-statutory and operated under common-law powers. Subject to fairness and compliance with the published guidance, the decision-makers enjoyed a broad discretion over both their process and outcome. The claimant had no pre-existing right to a loan, so enhanced scrutiny was not engaged.
3. The Board was entitled to require the claimant to prove that alternative funding sources had been exhausted. It was not required to fill gaps in the application, draw inferences in the claimant’s favour or make further inquiries. No duty to inquire or legitimate expectation of consultation arose.
4. The Board was entitled to consider the experience and sophistication of the claimant’s shareholders and management, its corporate structure, possible rights issues or venture-capital investment, and funds apparently ring-fenced elsewhere. The evidence did not come close to showing that this analysis was manifestly unreasonable. General pandemic hardship did not itself establish that all reasonable funding options had been exhausted.
5. The Secretariat’s assessment tables were administrative aids and did not bind the Board. The PwC independent business review supplied factual material for the Board’s assessment; it did not determine whether alternative funding had been exhausted and did not bind the Board. The Board was entitled to reach its own conclusion from the evidence as a whole.
6. Because the decision was rational, it was unnecessary to determine the alternative argument under section 31(2A) of the Senior Courts Act 1981.