In R. (on the application of Piffs Elm Ltd) v Commission for Local Administration in England [2023] EWCA Civ 486, the Court of Appeal considered the withdrawal of a decision by the Local Government Ombudsman (the “Ombudsman“), and in doing so, provided useful commentary regarding the limits of a public authority’s implied powers.

Key Points

  • When a rule-making power is conferred by Parliament, then, absent a contrary intention, Parliament also impliedly confers a power to rescind or revoke the rule.
  • However, if Parliament confers a function on a body or on an office holder, the provision conferring that power does not impliedly confer a power to rescind or revoke an earlier exercise of that function, even if the earlier exercise was legally flawed.
  • In such cases the proper remedy is judicial review.

Background

The dispute arose in the context of the claimant developer’s three failed applications for planning permission to Tewkesbury Council (the “Council“). The refusal of the second planning application was judicially reviewed, and the court found that there was an appearance of bias. The Council stated that they would address the appearance of bias but noted that Piffs Elm would not receive a refund for the fee associated with any further planning applications. Nonetheless, Piffs Elm proceeded to make a third application which the Council refused to determine, and it did not refund the application fee (the “Fee“). Piffs Elm subsequently made a complaint of maladministration to the Ombudsman.

The current proceedings involved a challenge to the following three decisions which stemmed from the events above:

  • the final report issued by the Ombudsman on 22 August 2019 (“D1“);
  • the Ombudsman’s decision on 14 November 2019 to withdraw D1 (“D2“); and
  • the final report issued by the Ombudsman on 3 February 2021 (“D3“).

In D1, the Ombudsman found fault with the Council because it did not consider exercising its discretion to refund the Fee. After taking legal advice, the Ombudsman concluded in D2 that D1 was legally flawed, and decided that he would re-open the investigation, withdraw D1 and issue a new report. The Ombudsman then issued D3, which concluded that the Council had not acted with fault as it was not clear whether the Council in fact had a discretion to refund the Fee. The High Court rejected Piffs Elm’s application for judicial review of the Ombudsman’s decisions, dismissing the argument that the Ombudsman had no power to withdraw D1 and the challenge to D3.

Judgment

The issues on appeal were whether:

  • the Ombudsman had the power to withdraw D1 (“Issue 1“);
  • if not, whether D1 was unlawful (“Issue 2“); and
  • if so, whether D3 was unlawful (“Issue 3“).

Issue 1

As it was accepted that there was no express power to withdraw D1, the main question was whether the Ombudsman had an implied power to withdraw D1. Laing LJ held that the correct approach was to ask whether the implication was necessary rather than convenient. The Court of Appeal found that it was not necessary to imply a power to withdraw the report in the context of this particular statutory scheme which contained a complete code. The court noted that the Ombudsman had many opportunities to consider arguments and information, including whether his investigation was complete, before reaching his decision. Consequently, it would have been unfair to the ‘winning’ party to have their decision swapped for a less favourable one, especially since there would be no time limit on the exercise of such an implied power.

The court considered that the only source of an implied power to withdraw a report would be contained in sections 12 and 14 of the Interpretation Act 1978, which deal with the continuity of powers and the implied power of statutory bodies and office holders. Sections 12 and 14 of the 1978 Act were said by Laing LJ to be an exhaustive statement of the circumstances in which Parliament has conferred an implied power to revoke an earlier exercise of a function. The provisions are clear that when a rule-making power is conferred, then, absent a contrary intention, Parliament also, by implication, confers a power to rescind or revoke the rule. However, since section 12 says nothing about revocation, it is also clear that if Parliament confers a function on a body or on an office holder, the provision conferring that power does not confer, by implication, on that body or office holder a power to rescind or revoke an earlier exercise of that function. The court noted that the ramifications of conferring an implied power via section 12 could not be limited to the specific scenario in question, as section 12 does not explain the context in which a power could be implied or the limits of any such power. Therefore, the court concluded that section 12 did not confer an implied power to revoke D1 and the parties should have sought judicial review of the legally flawed decision. To allow the Ombudsman to withdraw simply because he believes that his decision was unlawful would deprive the parties of the opportunity to go to court and have the matter decided by an independent arbiter, and of the procedural protections which apply on an application for judicial review.

Issue 2

As the Ombudsman had no power to withdraw D1, the court considered whether D1 was unlawful, concluding that the Ombudsman did not have jurisdiction to decide whether the Council had discretion to refund the Fee, as this was a question of law that should have been decided by the court.

Issue 3

The court held that the Ombudsman was correct to conclude that he had no jurisdiction to consider Piffs Elm’s complaint in relation to the Fee, which essentially raised two legal questions rather than being a complaint about an administrative act.

In summary, the court held that D1 was unlawful, D2 was unlawful because the Ombudsman had no power to withdraw D1, but D3 was lawful because the Ombudsman had no jurisdiction to consider questions of law. Therefore, Piffs Elm’s appeal was dismissed, despite successfully arguing that D2 was unlawful.

Comment

Although this case focuses on the lawfulness of the Ombudsman’s decisions and the scope of his powers, it also provides useful guidance for public authorities when publishing reports or final decisions. Public authorities should carefully consider all information and arguments before them in advance of publishing any decision, as the power to revoke a report will not easily be implied in the absence of an express power.

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