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England and Wales Court of Appeal (Civil Division) Decisions


You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Liverpool City Council, R (on Application of) v Local Commissioner For Local Government For North And North East England [2000] EWCA Civ 54 (24 February 2000)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2000/54.html
Cite as: [2000] EWCA Civ 54, (2000) 2 LGLR 603, [2001] 1 All ER 462, [2000] BLGR 571

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Case No: QBCOF 99/0446/A2
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
CROWN OFFICE LIST (MR JUSTICE HOOPER)
Royal Courts of Justice
Strand, London, WC2A 2LL
Thursday 24th February 2000

B e f o r e:
LORD JUSTICE HENRY
LORD JUSTICE CHADWICK
and
LORD JUSTICE MAY
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REGINA



- and -



LOCAL COMMISSIONER FOR LOCAL GOVERNMENT FOR NORTH AND NORTH EAST ENGLAND
ex parte
LIVERPOOL CITY COUNCIL

Respondent
Appellant


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(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 180 Fleet Street
London EC4A 2HD
Tel No: 0171 421 4040, Fax No: 0171 831 8838
Official Shorthand Writers to the Court)
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Ms F Patterson QC and C Crawford Esq
(instructed by Messrs Sharpe Pritchard for the Appellant)
B Ash Esq, QC and J Hobson Esq
(instructed by Messrs Pulvers for the Respondent)
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Judgment
As Approved by the Court
Crown Copyright ©


    LORD JUSTICE HENRY:
  1. This is an appeal from the judgment of Mr Justice Hooper refusing the appellants', Liverpool City Council, application for judicial review to quash the report of the respondent ("the Commissioner") dated the 20th May 1997. In that report she found maladministration on the part of the applicant in two respects. First, it was found that seven councillors voted in favour of the Liverpool FC's proposals (to erect an extension to a stand overshadowing the houses of the inhabitants of Anfield Road) without declaring their interest as season ticket holders or regular attenders, in breach of the disclosure rules set out in the National Code of Local Government Conduct ("the Code"), issued jointly by the Secretary of State for the Environment, The Secretary of State for Scotland and the Secretary of State for Wales (who I will collectively refer to as the Secretaries of State) under the provisions of the Local Government and Housing Act, 1989. Second, the Commissioner found that:
  2. "The use of the system of agreed voting in relation to a planning application operated by both the main political parties [Labour, in power, and the Liberal Democrats] before the matter was considered in committee was maladministration in this case."
  3. I adopt with gratitude Mr Justice Hooper's introductory analysis of the facts.
  4. "In 1995 Liverpool City Football Club sought planning permission to erect an extension to an existing stand at the Anfield Road end of the football stadium. The extension would have raised the height of the roof to some 15.8 metres and permitted the football club to provide additional seated accommodation. In 1964 and in 1994 somewhat similar applications had been refused.
    Following positive reports from the Development Control Sub-Committee (19/9/95) and the Planning and Transportation Committee (22/9/95), on 11th October 1995 the full Council resolved to grant planning permission subject to a section 106 agreement. That planning permission was finally granted on 25th February 1997.
    On 24th October 1995 the Anfield Road Residents Group wrote to the Commissioner asking her to investigate the grant of planning permission. In the letter the Group wrote:
    `The most obvious aspect of this affair is of course that if any other large company in the entertainment industry wanted to erect a 52 foot wall in front of people's homes their plans would have been summarily dismissed; why should it be any different for Liverpool Football Club plc.'
    The letter went on to say:
    `We hope that when you have looked into the matter you will agree with us that the councillors' and planning officers' actions have been both improper and suspect.'
    The Commissioner found maladministration in two respects. She found that six councillors were Liverpool City Football Club season ticket holders and one was a regular match attender. She found that none of the seven had declared an interest, which, in her view, ought to have been done. She also concluded that support for a football club of the kind demonstrated by these seven councillors was such that:
    `... a reasonable member of the public would have felt that it might have been a substantial influence on the way in which councillors voted.'
    Secondly, she found that some of the councillors voted as they had done:
    `... out of a misplaced loyalty to their political party.'
    Three councillors of the ruling Labour group had said during the investigation that:
    `... they voted for the application at the Council meeting but would have voted against if there had been a free vote.'
    Another Labour councillor:
    `... who had spoken against the proposal said that she absented herself during the voting at the Council meeting but would have voted in accordance with the requirements of the whip if she had voted at all.'
    A Labour councillor who had voted for the application said that he did so partly because that was the view of the Labour Group:
    `He says that he would never now vote against the view of the Group (having done so once before) even though he understands that a councillor who did so on a planning issue would not be subject to any Party discipline.'
    A Liberal Democrat councillor who had felt that the proposed stand was acceptable had nevertheless voted against it `with a heavy heart' because he was unwilling to take sides against his group.
    Labour councillors had voted for the application and none against. 30 Liberal Democrat councillors had voted against the application with only three in favour. Both main political parties discussed the application prior to the meetings of the Sub-Committee, the Committee and the Council. According to the Commissioner:
    `There is a general expectation amongst both parties that each councillor will vote in accordance with the view expressed by the majority at the group meeting.'
    The Commissioner concluded:
    `The patterns of voting show that the decision on whether to grant planning permission was heavily, and perhaps decisively, influenced by a sense of party loyalty whether or not councillors had a well founded fear of disciplinary actions which might follow a decision to vote against party preference. Such considerations cannot be material to the consideration of a planning application and serve to make subsequent debate in the Council chamber or Committee room meaningless. I consider that the use of the system of agreed voting in relation to a planning application operated by both the main political parties before the matter was considered in committee was maladministration in this case'."
  5. Maladministration is not defined by statute. Lord Denning MR adopted (see R -v- Local Commissioner for Administration for the North and North East Area of England ex parte Bradford Metropolitan City Council [1979] 1 QB 287 at 311H) a passage from the 4th Edition of Professor Wade's book on Administrative Law:
  6. "It will cover `bias, neglect, inattention, delay, incompetence, ineptitude, perversity, turpitude, arbitrariness and so on'. It `would be a long and interesting list', clearly open-ended, covering the manner in which a decision is reached or discretion is exercised; but excluding the merits of the decision itself or of the discretion itself. It follows that `discretionary decision, properly exercised which the complainant dislikes but cannot fault the manner in which it was taken, is excluded': see Hansard, 734 HC Deb, col. 51.
    In other words, if there is no maladministration, the ombudsman may not question any decision taken by the authorities. He must not go into the merits of it or intimate any view as to whether it was right or wrong. This is explicitly declared in section 34(3) of the Act of 1974. He can inquire whether there was maladministration or not. If he finds none, he must go no further. If he finds it, he can go on and inquire whether any person has suffered injustice thereby."
  7. But the Commissioner did not find that the maladministration had caused injustice to the complainants because she concluded that, given the fact that there was a properly made recommendation to grant from the Head of Planning, had the application been properly considered, approval would have been given. So the Commissioner made findings of maladministration in relation to the seven councillors' failure to disclose private interests, and as to the voting disciplines of the Labour and the Liberal Democrat parties on this issue. By way of relief, under section 30(3A) of the Local Government Act, 1974 ("the Act") she found that the seven councillors were in breach of the Code, and named them accordingly.
  8. The Local Government Ombudsman (as the Commissioner is colloquially called) is a creature of Part 3 of the Act. Section 26 of that part of the Act deals with matters subject to investigation, and sections 28, 29, 30 and 31 deal with the procedure in respect of investigations, the powers of the Commissioner in carrying out such investigations, and reports on the investigations. Section 26 of the Act is the principal section:
  9. "Matters subject to investigation
    Subject to the provisions of this Part of this Act where a written complaint is made by or on behalf of a member of the public who claims to have sustained injustice in consequence of maladministration in connection with action taken by or on behalf of an authority to which this Part of this Act applies, being action taken in the exercise of administrative functions of that authority, a Local Commissioner may investigate that complaint.
    ...
    A Local Commissioner shall not conduct an investigation under this Part of this Act in respect of any of the following matters, that is to say:
    any action in respect of which the person aggrieved has or had a right of appeal, reference or review to or before a tribunal constituted by or under any enactment;
    any action in respect of which the person aggrieved has or had a right of appeal to a Minister of the Crown; or
    any action in respect of which the person aggrieved has or had a remedy by way of proceedings in any court of law.
    Provided that a Local Commissioner may conduct an investigation notwithstanding the existence of such a right or remedy if satisfied that in the particular circumstances it is not reasonable to expect the person aggrieved to resort or have resorted to it.
    ...
    In determining whether to initiate, continue or discontinue an investigation, a Local Commissioner shall, subject to the preceding provisions of this section, act at discretion; and any question whether a complaint is duly made under this Part of this Act shall be determined by the Local Commissioner."
  10. Miss Frances Patterson QC, for Liverpool drew our attention to three issues or areas of concern to her clients, arising from the Commissioner's report. First, the finding that the seven councillors were in breach of the Code in their failure to disclose a private interest (paragraphs 7 - 15). Second, whether the Commissioner's investigation should have been commenced or curtailed having regard to section 26(6) of the Act (paragraphs 16 - 20). Third, the finding that both of the major local parties (Labour, the controlling party, and Liberal Democrat) imposed voting disciplines on the votes for this planning application which amounted to maladministration (paragraphs 21 - 28).
  11. In her approach to these issues, Miss Patterson did not (in her presentation to this Court) seek to set the Commissioner's report aside, nor to quash the finding of maladministration which it contained. Instead, by way of relief, she sought various wide-ranging declarations. We are invited in this case to go much further than is necessary to judge the legality and procedural regularity of the Commissioner's actions. We decline that invitation. It is generally dangerous for a court to go further than the issues before it require, and we are satisfied that it would be here.
  12. Maladministration: the seven councillors' failure to declare a private interest
  13. The principal complaint under this issue relates to the test setting the threshold for a declaration of interest by a councillor. The Commissioner proceeded with the test as set out in the Code. The Secretaries of State referred to above together issued the Code of recommended practice as regards the conduct of members of [local] authorities. This code was issued in 1990, and we are told it has not been revised. Before coming into effect, a draft of it was laid before and approved by each House of Parliament. All councillors are required on accepting office to declare that they will be guided by the Code. The introduction to the Code states:
  14. "The Code represents the standard against which the conduct of members will be judged, both by the public, and by their fellow councillors. The local ombudsman may also regard a breach of the code as incompatible with good administration, and may make a finding of maladministration by the council in these circumstances."
  15. The disclosure requirements as to personal interests are as follows:
  16. "If you have a private or personal interest in a question which councillors have to decide, you should never take any part in the decision, except in the exceptional circumstances described below. Where such exceptional circumstances do permit you to participate, you should never let your interest influence the decision.
    ...
    It is not enough to avoid actual impropriety. You should at all times avoid any occasion for suspicion and any appearance of improper conduct.
    Disclosure of pecuniary and other interests
    The law makes specific provision requiring you to disclose both direct and indirect pecuniary interests (including those of a spouse with whom you are living) which you may have in any matter coming before the council, a committee or a sub-committee. It prohibits you from speaking or voting on that matter. Your council's standing orders may also require you to withdraw from the meeting while the matter is discussed. You must also by law declare certain pecuniary interests in the statutory register kept for this purpose. These requirements must be scrupulously observed at all times.
    Interests which are not pecuniary can be just as important. You should not allow the impression to be created that you are, or may be, using your position to promote a private or personal interest, rather than forwarding the general public interest. Private and personal interests include those of your family and friends, as well as those arising through membership of, or association with clubs, societies and other organisations such as the Freemasons, trade unions and voluntary bodies.
    If you have private or personal non-pecuniary interests in a matter arising at a local authority meeting, you should always disclose it, unless it is insignificant, or one which you share with other members of the public generally as a ratepayer, a community charge payer or an inhabitant of an area.
    Where you have declared such a private or personal interest, you should decide whether it is clear and substantial. If it is not, then you may continue to take part in the discussion and vote on it. If, however, it is a clear and substantial interest, then (except in the special circumstances described below) you should never take any further part in the proceedings, and should always withdraw from the meeting whilst the matter is being considered. In deciding whether such an interest is clear and substantial, you should ask yourself whether members of the public, knowing the facts of the situation, would reasonably think that you might be influenced by it. If you think so, you should regard the interest as clear and substantial."
    The crucial words are those underlined in paragraph 11.
  17. The application of the test was in paragraph 86 of the report, that paragraph reflecting, as one would expect, the test itself:
  18. "Support for a football club engenders a particularly intense type of loyalty which goes some way beyond a preference for one supermarket over another. I am in no doubt that a reasonable member of the public would have felt that it might have been a substantial influence on the way in which the councillors voted. The reasonable person would have had that view confirmed on seeing that the only members of the main opposition party who voted in favour of the application were holders of season tickets. Thus I conclude that the seven councillors identified in this report did have a clear and substantial interest. None of them declared an interest and therefore never went on to ask themselves the relevant question. Season ticket holders or regular match attenders should in my view not only have declared an interest, but also left the meeting. I consider that there was maladministration here ...."
    and then she went on to name the councillors in question. In her reference to the "main opposition party", she was referring to the Liberal Democrats. The Liberal Democrats had taken a caucus decision to oppose the grant of planning permission to Liverpool Football Club. The three councillors who defied the caucus decision and voted in support the club's application were all undeclared season ticket holders.
  19. So she found that seven councillors who should not have taken part in the decision in fact did take part, without having disclosed their interest.
  20. Miss Patterson's elaborate attack on the test of when an interest should be disclosed founds on the case of R -v- Gough [1993] AC 646. In Gough, in the context of the examination of a juror's conduct in a criminal case, the Court was presented with two conflicting lines of authority. The finding in Gough is analysed in a decision of this Court presided over by the Lord Chief Justice (Locabail (UK) Limited -v- Bayfield Properties Limited (17th November 1999). For present purposes it is simply necessary to say that the two competing tests were whether there was "... a reasonable apprehension or suspicion of bias" or "... a real danger or possibility of bias". The former test accords with the Code (and was clearly the test used by the Commissioner). The latter test is the one approved by their Lordships in Gough, and is now binding on all subordinate courts. It is not disputed that the more stringent test (ie, that with the lower threshold for disclosure) is the test to be found in the Code.
  21. Miss Patterson concedes that the Commissioner, insofar as she was applying the words of the Code and the test there laid down, reached a decision which a reasonable Commissioner could reach. But she suggests that if the less stringent legal test had been used, the Commissioner's finding might have been different. However, she does not ask this Court to quash the finding of maladministration and order for the naming of the councillors. That she regards as history, and looks to the future in the declarations she formulates.
  22. We note from R -v- Bow Street Magistrates, ex parte Pinochet (No 2) [1999] 2 WLR 272 and Locabail (UK) Limited (above) that the Gough formulation of the test has not been accepted in a number of common law jurisdictions and that there has been debate in those authorities as to whether the semantic difference between those two tests is likely to make any (and if so what) difference in practice. Thus Lord Hope in ex parte Pinochet at page 290:
  23. "Although the tests are described differently, their application by the appellate courts in each country is likely in practice to reach results which are so similar as to be indistinguishable."
  24. Given the "... particularly intense type of loyalty" engendered by Liverpool Football Club, I am not persuaded that the answer to the disclosure question would have been different had the test been "... a real danger or possibility of bias". In either event, season ticket holders and other regular attenders should in my judgment have declared their interest, and it was maladministration not to.
  25. Those are my views. I do not consider there to be a misdirection, still less a material misdirection. But if it were to be found that the Commissioner had misdirected herself in this regard, in my judgment the correct remedy for this court would be to send the matter back to her to consider how she would have judged the named counsellors' failure to disclose when measured against the Gough test.
  26. The judge saw no good reason why the Commissioner, where the statutory concern was maladministration, should not follow the Code guidance as to what constituted a breach of the Code, and the Code recognised the Commissioner's power to find that a breach of the Code was maladministration. Maladministration comes in many guises, and while there is a substantial element of overlap between maladministration and unlawful conduct by councils or officers or councillors in local government, they are not synonymous. Section 26 and Section 34(3) limit the Commissioner's powers to the investigation of maladministration. She was ruling on maladministration and I do not see how it can be an error of law in the circumstances to apply the Secretaries of States' Code. This after all was the same test that all councillors had, on election, declared they would be bound by. If and when the Secretaries of State feel they should revise the Code, they will do so. Meanwhile, no-one is inviting the Court to strike down the relevant paragraphs of that Code as unlawfully applying too stringent a test of disclosure. And while the Code is there, the Commissioner must take account of it. The Commissioner has not made a finding of unlawfulness (for which she would have no legal mandate) but has made a finding of breach of the Code and maladministration, which findings were well within her discretionary powers. There was nothing wrong with her approach to the issue of maladministration.
  27. Miss Patterson reminded us of R -v- Secretary of State for the Environment, ex parte Kirkstall Valley Campaign [1996] 3 AER 304. Sedley J, when dealing with questions of conflict of interest said:
  28. "Although in the nature of things it will ordinarily be for members ... to make up their minds in the first instance, whether they have got it right will always be a question of law."
  29. Mr Ash QC for the Commissioner points out that that unimpeachable statement was made in context of whether there was "... in law a margin of appreciation ..." within which members may "... make up their minds about conflicts of interest ..." but it lends no support to the proposition that the Commissioner is obliged to apply or have regard to the legal test of bias (which extends far beyond questions of local government) when performing her statutory function of investigating breaches of the Code and maladministration.
  30. The Council's skeleton argument impliedly asserts that the Commissioner "slavishly adhered" to the Code. I see no evidence of that. The Commissioner dealt with the Code in paragraph 8 to 15 of her report. There is nothing to suggest that her approach to the Code can be properly criticised.
  31. Next, a general point is made as to the relationship between an investigation carried on by the Commissioner, and a legal action against the council and/or its councillors and officers. For this we must go to section 26 of the Local Government Act, 1974, set out in paragraph 3 hereof. This was the statutory introduction of the local government ombudsman scheme. It was at a time when judicial review (as we know it today) was in its infancy: three years before Order 53 (Applications for Judicial Review) became law. Section 26(1) sets out the trigger for investigative action: a complaint of injustice in consequence of maladministration. Sub-section 6) imposes limits when the Commissioner should not investigate such complaints. In particular, the Commissioner should not investigate
  32. "(c) ... any action [taken] in respect of which a person aggrieved has or had a remedy by way of proceedings in a court of law."
  33. Judicial review would be such a remedy. But that embargo is subject to an important proviso, which the Commissioner here applied and to which we must come.
  34. What may not have been recognised back in 1974 was the emergence of judicial review to the point where most if not almost all matters which could form the basis for a complaint of maladministration are matters for which the elastic qualities of judicial review might provide a remedy. In that situation, the proviso in sub-section 6) becomes of greater importance:
  35. "Provided that a Local Commissioner may conduct an investigation notwithstanding the existence of such a right or remedy if satisfied that in the particular circumstances it is not reasonable to expect the person aggrieved to resort or to have resorted to it."
  36. Here, the letter of complaint initiating the investigation by the Anfield Road residents was long and detailed. It was a letter of complaint inviting an investigation complaining of council actions that were "improper and suspect". Nothing in the letter indicated that the residents were contemplating judicial review proceedings. The judge found that there was not sufficient information in the letter to found judicial review. But, given the growth of judicial review, I suspect that any experienced public lawyer would be confident of being able to put together a challenge by way of judicial review to the voting procedures and the naming of councillors.
  37. In her affidavit the Commissioner deals with the difficulty of applying sub-section (c):
  38. "However, the availability of judicial review is less certain. I am aware that from time to time the Courts have widened or narrowed the availability of that remedy, and I bear in mind that the requirement to obtain leave to move for judicial review necessarily restricts the availability of that remedy. On the other hand I am aware of an argument that nearly all actions which could amount to maladministration ... could also be the subject of an application for leave to move for judicial review: for example an allegation about the wrongful allocation of a council house. My understanding, however, is that maladministration and illegality are different concepts, although there is an overlap, and it is only where there is that overlap that Section 26(6)(c) comes into play.
    ...
    The complainants were complaining about a planning decision in favour of the Liverpool Football Club in circumstances where certain councillors who had been involved in that decision were strong supporters of that club. Prima facie therefore, the complaint presented itself as a possible breach of the Local Government Code of Conduct, a matter placed by Parliament under Section 30(3A) of the Act within the purview of the Local Commissioners rather than the courts."
  39. Section 30(3A) reads:
  40. "Where the Local Commissioner is of the opinion-
    that action constituting maladministration was taken which involved a member of the authority concerned, and
    that the member's conduct constituted a breach of the National Code of Local Government Conduct,
    then, unless the Commissioner is satisfied that it would be unjust to do so, the report shall name the member and give particulars of the breach."
  41. Later she was to add:
  42. "In relation to the complaint, the subject of this application, I was simply looking at an alleged breach of the Code of Conduct, and not considering whether the approval complained of had been obtained through bias, using that word in the sense it has been considered over the years by the courts."
    Indeed, on those grounds she did not consider that sub-section (c) was a bar to her proceedings. I am not sure that she was right in that conclusion. If wrong, she would have had to consider the proviso. And this she addressed in her affidavit:
    "Had I been advised that judicial review was potentially available to the complainants her, I would have gone on to consider whether I should exercise my discretion under the proviso to Section 26(6) to investigate the complaint. It is my belief that in that event I would have exercised discretion in favour of the complainants because I believe in the particular circumstances of this case it would have been unreasonable to expect the complainants to have been required to resort to the remedy of judicial review. This is because I understood the complainants to be a group in modest housing, who would have been unlikely to have had the means to pursue that remedy from their own resources, particularly having regard to the uncertainty of the remedy; it seems to me that it is by no means certain that judicial would be appropriate for maladministration where it related to a breach of the Code of Conduct. Further I would have particularly had in mind that it would have been very difficult, if not impossible, for the complainants to obtain the necessary evidence to support such an application. Much of the evidence upon which I relied in my report was not available in documentary form, but emerged during interviews with the members concerned. The complainants however do not have the investigatory powers given to the Commissioner by the Act and thus that evidence would have been unobtainable by them."
  43. In my judgment this was a clear case for the application of the proviso. Serious allegations of maladministration had been made. Such allegations could best be investigated by the resources and powers of the Commissioners, with her powers to compel both disclosure of documents, and the giving of assistance to the investigation. The Commissioner was in a position to get to the bottom of a prima facie case of maladministration, and the ratepayers would be unlikely to have reached that goal, having regard to the weaknesses of the coercive fact finding potential of judicial review. As she found, it would be very difficult, if not impossible, for the complainants to obtain the necessary evidence in judicial review proceedings. Additionally, the complainants were a group in modest housing, unlikely to have the means to pursue the remedy. The Commissioner was clearly right to use the proviso to continue with her investigation. This case is a good example of a case where the Commissioner's investigation and report can provide the just remedy when judicial review might fail to; and can reach facts which might not emerge under the judicial review process.
  44. Finally, the third main issue, party loyalty, and the parties' voting disciplines. The line is clear - a local authority councillor is entitled to give weight to the views of party colleagues, but should not abdicate responsibility by voting blindly in support of party policy or party whip (see R -v- Waltham Forest LDC [1988] QB 419). See too paragraph 4 of the Code:
  45. "Whilst you may be strongly influenced by the views of others, and of your party in particular, it is your responsibility alone to decide what view to take on any question which the councillors have to decide."
  46. As is made clear in this judgment, if the Code is less permissive than the law, it is the Code which councillors should use for guidance. In some planning applications, particularly those with resource implications, party policy will be a material consideration, but in certain planning applications (and I would have thought this was one) would be outside party policies, and it is hard to see how then "heavy and perhaps decisive pressure" at the pre-meeting caucus would be a "material consideration" to be taken into account when exercising the Section 70 powers to determine planning applications under the Town & County Planning Act, 1990.
  47. The block voting Labour controlled Liverpool at this time, with the Liberal Democrats the second party. Both parties, as is not uncommon in local government, were in the habit of meeting privately prior to the Council Meeting and agreeing how to vote. Here it was agreed by Labour that they would vote for the club being granted planning permission, and by the Liberal Democrats to oppose it. Forty-one Labour councillors voted for the application, and none against. Thirty Liberal Democrat councillors voted against the application, and three for. All those three Liberal Democrats who defied the party arrangement to vote for Liverpool Football Club were undeclared season ticket holders at Anfield. Of the "others", two voted for and two against.
  48. The Commissioner's findings were in her important paragraph 84, which for convenience of reference, I repeat:
  49. "The patterns of voting show that the decision on whether to grant planning permission was heavily, and perhaps decisively, influenced by a sense of party political loyalty whether or not councillors had a well-founded fear of disciplinary action which might follow a decision to vote against party preference. Such considerations cannot be material to the consideration of the planning application and serve to make subsequent debate in the Council Chamber or Committee Room meaningless. I consider that the use of the system of agreed voting in relation to a planning application operated by both the main political parties before the matter was considered in committee was maladministration in this case."
  50. Here the Commissioner was clearly greatly influenced by what she discovered in the course of her investigation. She was informed by councillors J, K and M that they would have voted differently had it been a free vote. Councillor F informed the Commissioner that he would never vote against the view of the Labour group, and Councillor P voted in accordance with the Liberal Democrat party line, against the development, even though he felt the proposed stand was acceptable.
  51. The Council attack on paragraph 84 on semantic grounds. The submission is:
  52. - the Code permits a councillor to be "strongly influenced" by the views of others, and his party in particular;
    - "strongly" means the same as "heavily",
    - heavy influence was here permissible,
    - however, if that influence were decisive that would be maladministration, but
    - the finding was only that "perhaps" there had been such decisive influence.
  53. To so construe paragraph 84 is to take it entirely out of context. The question to be answered by the Commissioner (who had interviewed the councillors) was whether there was maladministration in the vote on this issue, and what led up to it. Here there was heavy and perhaps decisive pressure imposed by a sense of party loyalty. Such party pressure served to make the subsequent debate in committee meaningless. It was out of place in this application. This planning application deserved a proper debate and not a foregone conclusion.. To use procedures to deny both the Anfield Road residents and the football club a meaningful debate is to deny a transparent democratic decision.
  54. There was ample evidence on which the Commissioner could conclude that the system of agreed voting in the circumstances was maladministration in this case. The line is precisely that set out in paragraph 84. Where the party political influence is decisive, it is clear that an immaterial consideration has been taken into account on the facts of this particular application.
  55. Accordingly, the challenge to the Commissioner's investigation, report and findings fail. It has not been shown that she went outside the generous ambit of the discretion given to her and in my judgment this appeal should be dismissed.
  56. LORD JUSTICE CHADWICK:
  57. By its notice of appeal the Liverpool City Council seeks an order of certiorari to quash the report dated 20 May 1997 in which the respondent, the Local Commissioner for Administration in the North and North East of England, found maladministration on the part of the Council. At the hearing of the appeal, Ms Patterson QC did not pursue that relief. Nor did she ask us to make the declarations which had been sought in the notice of appeal in the following terms: (i) that the respondent exceeded her powers in reporting adversely to the Council in respect of her investigation, (ii) that the report and/or the findings of maladministration made therein were void and/or of no effect and/or made without jurisdiction, and (iii) that any personal interest on the part of a councillor was not such as to disqualify him from the decision making process. The relief which she eventually sought, formulated in the course of her submissions, was this:
  58. "1) A declaration that the respondent, in investigating a complaint notwithstanding the availability of a remedy by way of proceedings in any court of law, in the exercise of her discretion under section 26(6) of the Local Government Act 1974, failed to have regard to [and follow] a relevant consideration, namely the legal principles relevant to that remedy.
    2) A declaration that the respondent, in investigating a complaint notwithstanding the availability of a remedy by way of proceedings in any court of law, in the exercise of the discretion under section 26(6) of the Local Government Act 1974, failed to have regard to [and follow] a relevant consideration, namely the legal principles relevant to influence of considerations of party political loyalty.
    3) A declaration that the respondent, in investigating a complaint notwithstanding the availability of a remedy by way of proceedings in any court of law, in the exercise of the discretion under section 26(6) of the Local Government Act 1974, failed to have regard to [and follow] a relevant consideration, namely the legal principles relevant to allegations of bias."
  59. Section 26 of the Local Government Act 1974 gives power to a Local Commissioner (appointed under section 23 of that Act) to investigate complaints of maladministration. The condition precedent to the exercise of that power is that the complaint should by made in writing by or on behalf of a member of the public who claims to have sustained injustice in consequence of maladministration in connection with action taken by or on behalf of an authority to which Part III of the Act applies, being action taken in the exercise of administrative functions of that authority - see section 26(1). Section 26(6) imposes a limitation on the power: a Local Commissioner shall not conduct an investigation under Part III of the Act in respect of ". . . (c) any action in respect of which the person aggrieved has or had a remedy by way of proceedings in any court of law". But that limitation is, itself, subject to the qualification set out in the final paragraph of section 26(6):
  60. "Provided that a Local Commissioner may conduct an investigation not withstanding the existence of such a . . . remedy if satisfied that in the particular circumstances it is not reasonable to expect the person aggrieved to resort or have resorted to it."
  61. It is clear, therefore, that before commencing to investigate a complaint made under section 26 of the Act, a Commissioner ought to address the question whether the complainant (or person aggrieved) has or had some remedy by way of proceedings in any court of law - in particular, ought to consider whether the complaint could be made the subject of proceedings for judicial review. Consideration of that question does not, as it seems to me, involve any exercise of discretion. The existence, or otherwise, of an alternative remedy is a question of law. But, if the Commissioner reaches the conclusion that there is a remedy by way of proceedings in a court of law, then he must go on to consider whether, in the particular circumstances, it is not reasonable to expect the person aggrieved to resort (or to have resorted) to such proceedings. That does involve an exercise of discretion. It is for the Commissioner to decide whether or not he is satisfied that it is not reasonable to expect the person aggrieved to pursue the alternative remedy.
  62. There is, therefore, potential for two grounds of challenge to the conduct of an investigation in circumstances in which it is said that the complainant has or had a remedy by way of proceedings in a court of law. First, it may be said that the Commissioner failed to address the question whether there was an alternative remedy; or, having addressed that question, reached the incorrect conclusion that there was not. Second, it may be said that the Commissioner, having identified the existence of an alternative remedy, failed to address the question whether it was reasonable to expect the person aggrieved to have resort to it; or, having addressed that question, reached a conclusion which was, itself, Wednesbury unreasonable.
  63. It is not clear to me how either of those two grounds of challenge can be advanced in support of the first (or, indeed, any) of the declarations now sought on behalf of the Council. A complaint that, in conducting an investigation "notwithstanding the availability of a remedy by way of proceedings in any court of law" in the exercise of her discretion under section 26(6) of the 1974 Act, the Commissioner failed to have regard to "the legal principles relevant to that remedy" does not, as it seems to me, contain within it an allegation that the Commissioner failed to appreciate that there was a remedy by way of proceedings in a court of law. Nor does it contain within it an allegation that the Commissioner erred in deciding, as a matter of discretion, to conduct the investigation notwithstanding the existence of an alternative remedy. The criticism implicit in the declarations now sought is not that the Commissioner should have declined to conduct, or to continue with, an investigation. The criticism is that, having properly decided to conduct the investigation, the Commissioner applied the wrong principles when reaching her conclusions on the questions which she had to decide in the course of that investigation.
  64. Nevertheless, the skeleton argument submitted on behalf of the Council identifies, as one of the issues which are said to arise on this appeal:
  65. "Issue 3. The learned judge erred in holding, contrary to the authority of R v Commissioner for Local Administration, ex p Croydon L.B.C. [1989] 1 All ER 1033, that the Respondent could have regard to the likely success of an application for judicial review in determining whether to exercise her discretion to investigate or continue to investigate a complaint and/or in determining whether there was an alternative remedy available to the local residents making the complaint to the Respondent."
  66. That part of the decision of the Divisional Court in ex parte Croydon on which reliance is placed is found in the judgment of Lord Justice Woolf (with whom Lord Justice Hutchison agreed) at page 1044d-f of the report. Lord Justice Woolf pointed out that the question for the Commissioner, under section 26(6)(c), was not whether proceedings in a court of law - and, in particular, proceedings by way of application for judicial review - would succeed. The relevant question was whether a court of law was an appropriate forum for investigating the subject matter of the complaint. But Lord Justice Woolf went on to observe, at page 1045e-f, that even if that question was answered in the affirmative - as, having regard to the increasing readiness of the courts to entertain applications for judicial review, it commonly would be - the Commissioner retained his discretion to apply the proviso to section 26(6) and "unless he exercises this discretion unlawfully the courts will not and cannot interfere with his decision".
  67. I find it difficult, for the reasons which I have sought to give, to understand how it can be said that the issue identified as "Issue 3" in Ms Patterson's skeleton argument arises in the context of the relief which she now seeks on behalf of the Council. But, if the issue does arise, then the point is met by the clear indication in paragraph 9 of the Commissioner's affidavit of 20 November 1997 (to which Lord Justice Henry has referred) that - had she been advised that judicial review was available to the complainants in the present case - she would have gone on to consider whether she should, nevertheless, conduct an investigation into the complaint in the exercise of her discretion under the proviso; and would have decided to do so. I agree with Lord Justice Henry that there can be no doubt that the Commissioner would have been entitled to take that decision.
  68. I turn, therefore, to the criticism which does underlie the first (and, I think, also the second and third) of the declarations now sought: that, having decided to conduct an investigation notwithstanding the availability of a remedy by way of judicial review proceedings, the Commissioner ought to have applied the same principles in reaching her conclusions as the court would have applied if it had been considering whether to grant that remedy. This criticism finds expression in the first issue identified in Ms Patterson's skeleton argument:
  69. "Issue 1. The learned judge erred in concluding that, in investigating complaints of maladministration, when the subject matter of the complaint overlapped a complaint of unlawfulness, the Respondent did not have to take into account and/or follow and/or set out her reasons for not following the legal principles relevant to a complaint of unlawfulness."
  70. In my view the answer to that criticism is that already given by Lord Justice Henry. Although there is a substantial element of overlap between maladministration and unlawful conduct in the context of local government, the concepts are not synonymous. There will be cases of maladministration which do not involve unlawful conduct. As Lord Denning, Master of the Rolls, observed in R v Local Commissioner for Administration for the North and North East Area of England, ex parte Bradford Metropolitan City Council [1979] 1 QB 287, at page 311H - quoting from the debate on the Bill which was enacted as the Parliamentary Commissioner Act 1967 - "It [maladministration] will cover `bias, neglect, inattention, delay, incompetence, ineptitude, perversity, turpitude, arbitrariness and so on.' It `would be a long and interesting list' clearly open-ended, covering the manner in which a decision is reached or discretion is exercised; but excluding the merits of the decision itself or of the discretion itself." So there is no reason in principle why the considerations which determine whether there has been maladministration should, necessarily, be the same as those which determine whether there has been unlawful conduct. The Commissioner's power is to investigate and report on maladministration; not to determine whether conduct has been unlawful. So there is no reason why, when exercising the power to investigate and report, (which has been conferred on him by the 1974 Act) he should, necessarily, be constrained by the legal principles which would be applicable if he were carrying out the different task (for which he has no mandate) of determining whether conduct has been unlawful.
  71. Nor is there any reason why the position should be otherwise if, notwithstanding the availability of a remedy by way of proceedings in a court of law, the Commissioner decides, in the exercise of his discretion under the proviso to section 26(6), to conduct an investigation into a complaint of maladministration. The availability of the alternative remedy requires him to consider whether to proceed with the investigation. The fact that, if the complainant were left to pursue the alternative remedy, a court would or might apply legal principles to the determination of the question which would be before it - namely, whether the conduct complained of was unlawful - which differed from those which the Commissioner would regard as applicable in an investigation into the complaint which is before him, is a matter which the Commissioner may (and, in my view, should) take into account in deciding whether he should proceed with the investigation. But, if he does decide to proceed with the investigation, then he must give effect to that decision. He must proceed on the basis that he is investigating a complaint of maladministration under the powers conferred upon him by statute. He is not acting as a surrogate of the court in determining whether there has been unlawful conduct.
  72. Section 31(1) of the Local Government and Housing Act 1989 gave power to the Secretary of State to issue a code of recommended practice ("the National Code of Local Government Conduct") for the guidance of members of local authorities. Section 31(4) required that the code should not be issued unless a draft had been laid before and approved by a resolution of each House of Parliament. Section 31(7) provided that the form of declaration of acceptance of office, to be made by a councillor upon election under section 83 of the Local Government Act 1972, might include an undertaking by the declarant to be guided by the National Code in the performance of his functions. Section 32(1)(b) of the 1989 Act introduced into the 1974 Act a new subsection (section 30(3A) of the 1974 Act) in these terms:
  73. Where the Local Commissioner is of the opinion -
    that action constituting maladministration was taken which involved a member of the authority concerned, and
    that the member's conduct constituted a breach of the National Code of Local Government Conduct,
    then, unless the Local Commissioner is satisfied that it would be unjust to do so, the report shall name the member and give particulars of the breach."
  74. The introduction to the National Code issued by the Secretary of State pursuant to the power conferred by the 1989 Act contains the following paragraph:
  75. "The Code represents the standard against which the conduct of members will be judged, both by the public and by their fellow councillors. The local ombudsmen may also regard a breach of the Code as incompatible with good administration, and may make a finding of maladministration by the council in these circumstances."
  76. As envisaged by section 31(7) of the 1989 Act, the Code provides that all councillors are required on accepting office to declare that they will be guided by the Code. That obligation was made statutory on 3 May 1990 by the Local Elections (Principal Areas) (Declaration of Acceptance of Office) Order 1990 (S.I. 1990 No. 932).
  77. The position, therefore, is that the National Code is issued under the authority of Parliament, and with the concurrence of both Houses of Parliament. The Local Commissioner must have regard to it where an action constituting maladministration involves a member of the authority concerned; because, if that member's conduct constituted a breach of the National Code, he must be named unless the Commissioner is satisfied that it would be unjust to do so. The Code contemplates that a breach may itself be treated as an incident of maladministration. Members of local authorities are required by statute to declare - and, in practice, do declare - that they will be guided by it. It is pertinent to have these considerations in mind when addressing the second issue identified in Ms Patterson's skeleton argument:
  78. "Issue 2. The learned judge erred in finding that the Ombudsman was bound to apply the National Code of Local Government Conduct without giving any or any proper consideration as to whether the Respondent had a discretion as to whether to apply the Code where:
    the Code no longer reflected the correct legal test of bias (and hence when local authority members had to declare their personal interests); and
    the application of the Code acted as an unlawful fetter on the discretion on the part of the Respondent."
  79. Those parts of the Code directly relevant to the declaration of a member's non-pecuniary interest- and his subsequent participation in any vote which might affect that interest - are contained in paragraphs 9, 10 and 11. They are set out in the judgment of Lord Justice Henry and it is unnecessary to rehearse them. It is sufficient to indicate that I agree with his view that the crucial words are those in the two final sentences of paragraph 11:
  80. ... In deciding whether such an interest is clear and substantial, you should ask yourself whether members of the public, knowing the facts of the situation, would reasonably think that you might be influenced by it. If you think so, you should regard the interest as clear and substantial.
  81. Ms Patterson submitted that that test is more stringent than the test of apparent bias now applied in the courts. She referred us to R v Gough [1993] AC 646. The distinction, as Lord Justice Henry has pointed out in his judgment, is between "a reasonable apprehension or suspicion of bias" and "a real danger or possibility of bias"; although it is pertinent to keep in mind the observation of Lord Hope of Craighead in R v Bow Street Magistrates, ex parte Pinochet (No 2) [1999] 2 WLR 272, at page 290, that the application of either test to particular facts is likely to produce the same result.
  82. The Commissioner applied the "reasonable apprehension" test. That, as it seems to me, is plainly the test that was envisaged by the Code. I reject the submission that the Commissioner misdirected herself. In my view she was correct to accept and adopt the guidance provided by the Code. The Code set out the test by which the members of the authority had declared themselves willing to be guided. That was the test by which they had been told, in the introduction to the Code, their conduct would be judged. That was the test which the Commissioner had to apply when deciding whether section 30(3A) of the 1974 Act required the members in question to be named. There was, to my mind, no reason why the Commissioner should have directed herself that, in investigating maladministration, she must discard the test provided by the Code in favour of some other test which might be applied by the courts in determining unlawfulness. In my view the criticism which underlies the third of the declarations now sought is ill-founded.
  83. The criticism which underlies the second of the declarations now sought finds expression in the issues identified as "Issue 4" and "Issue 5" in Ms Patterson's skeleton argument:
  84. "Issue 4. The learned judge erred in finding that the legitimate influence of party politics in regard to planning applications is different from other areas of local authority administration.
    Issue 5. The learned judge erred in finding that decisions on planning applications cannot be heavily influenced as opposed to determined by considerations of party political loyalty."
  85. The National Code gives recognition to the legitimate influence of party political considerations in the context of local government decisions. Paragraph 4 contains the following guidance:
  86. "Whilst you may be strongly influenced by the views of others, and your party in particular, it is your responsibility alone to decide what view to take on any question which councillors have to decide."
  87. In my view that reflects the position in law, as expressed by Lord Justice Russell in R v Waltham Forest London Borough Council, ex parte Baxter and others [1988] 1 QB 419, at page 428G-H:
  88. "Party loyalty, party unanimity, party policy, were all relevant considerations for the individual councillor. The vote becomes unlawful only when the councillor allows those considerations or any other outside influences so to dominate as to exclude other considerations which are required for balanced judgment. If, by blindly toeing the party line, the councillor deprives himself of any real choice or the exercise of any real discretion, then his vote can be impugned and any resolution supported by his vote potentially flawed."
  89. The Code recognises that party loyalty may be a legitimate consideration; but the weight to be given to that consideration in relation to any particular decision must be a matter for the individual councillor and must depend on the nature of the decision to be taken. As Lord Justice Henry has pointed out, there may well be planning applications which have important resource or environmental consequences. In those cases the policy objectives of the party to which the member adheres are engaged and may properly be given very substantial weight by the member when reaching his decision as to how to cast his vote in Council. But many, if not most, planning applications will not be of that nature. The Commissioner clearly thought that the application in relation to the Anfield Road stand fell into the latter class. It is impossible to say that she was wrong to take that view. It is equally impossible to say that, holding that view and in the light of the evidence which she had heard from the members themselves in the course of her investigation, she was not entitled to reach the conclusion that, in the present case, real or perceived party constraints had gone far beyond what was permissible - both under the Code and under the general law. She was plainly entitled to hold that those constraints had been productive of maladministration.
  90. For those reasons, and for the reasons given by Lord Justice Henry with whose judgment I agree, I am not persuaded that it would be appropriate to make any of the declarations now sought. The appeal must be dismissed.
  91. LORD JUSTICE MAY:

  92. For the reasons set out by my Lords, Lord Justice Henry and Lord Justice Chadwick, I would agree that this appeal must be dismissed.
  93. Order: Appeal dismissed: with costs, to be assessed if not agreed: permission to appeal to the House of Lords refused.
    (Order does not form part of approved judgment).


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