|[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]|
England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> First Real Estates (UK) Ltd v Birmingham City Council  EWHC 817 (Admin) (01 May 2009)
Cite as:  EWHC 817 (Admin)
[New search] [Context] [View without highlighting] [Printable RTF version] [Help]
QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| FIRST REAL ESTATES (UK) LIMITED
|- and -
|BIRMINGHAM CITY COUNCIL
WordWave International Limited
A Merrill Communications Company
165 Fleet Street, London EC4A 2DY
Tel No: 020 7404 1400, Fax No: 020 7404 1424
Official Shorthand Writers to the Court)
Mr Jon Holbrook (instructed by Legal Services Department) for the Defendant
Hearing dates: 3 April, 2009
Crown Copyright ©
Mr Justice Plender:
"The licence is terminable by either party on receipt of written notice at any time".
The licence agreements also provided for payment of licence fees four weekly in arrears and pro rata. This meant that where a weekly licence fee was computed from a Sunday to a Sunday, and the licence was terminated on the first Wednesday, FRE would be entitled to be paid four sevenths of one week's licence fee. The Council did in fact make use of its facility to terminate licence agreements with FRE without notice. For instance, by letter dated 21 September 2007 a member of the Council's staff wrote to FRE a letter ending:
"Our tenant… has now vacated the property on 14 September 2007 and we hereby terminate the licence agreement with immediate effect."
"we warrant for our part that the Housing Unit complies with all current legislation and is fully licensed as required to be used as residential property."
The Council did not inspect each of the properties made available to it for use by homeless people but relied on the providers of the property to do so. Providers of accommodation, including FRE, were required to complete "Property Self Certification" forms, certifying that the provider had examined the property and found it satisfactory in thirteen itemised respects. They were also required to complete self-certification forms in respect of the safety of the gas supply and appliances.
"The (Council) (Acting Strategic Director) determined not to proceed further with contract (CPOC/0293) in respect of which you have submitted a tender".
"We are aware of the properties that are provided by your company, however, as previously advised, we are unable to confirm if we are able to use the properties due to the nature of the accommodation service provision …
"For this reasons [sic] we are unable to advice you [sic] at any point that we are able to use your properties."
"The Agent who showed Mr Nurhussein around the property gave the impression that he was from the local authority. He advised Mr Nurhussein that if he failed to sign for the accommodation, then he would be on the streets".
It appears from a handwritten note on the file that Mr Nurhussein and family were moved to bed and breakfast accommodation on the day the letter arrived. Another licensee stated that she was given temporary accommodation at 126 Bordesley Green East and only stayed for one night because "it was dirty, infested with insects in the kitchen and broken windows. My mother also witnessed seeing mice in the kitchen". A Council buildings inspector, after visiting on 2 May 2008 a different property supplied by FRE, listed a series of defects and concluded "In my opinion this property is unsuitable for temporary accommodation use. Do not re-use".
"I also became aware of the problem with the rent claimed by the Claimant for the property at 1126 Bordesley Green … when it was unoccupied … Statements of account for March and April 2008 are exhibited at GKS8. These statements suggest to me that the Claimant was charging the Council for properties that were not occupied."
(i) The Council did not notify FRE in advance of the particular issues and properties to be discussed at the meeting that day.
(ii) At the commencement of the meeting Mr Iftikhar Hussain was presented with a letter setting out various allegations of regulatory defects but was not given time to investigate these and to respond as he would wish.
(iii) The allegations as to non-compliance with the Gas Safety Installation and Use) Regulations related to more than 150 certificates so that it would take considerable time to check them but Mr Hussain was not allowed the time to do so.
(iv) The allegations as to non-compliance with the Health and Safety Rating System introduced under Part I of the Housing Act related to 23 properties so that it would take considerable time to check them but Mr Hussain was not allowed the time to do so.
(v) No period of time was offered to FRE at the meeting on 16 June to remedy the various defects in the properties of which complaint was made.
(vi) The Claimant had not been forewarned of "the vital fact" that the meeting was to be followed by a discussion as to whether the Council would continue to use FRE's services.
Among the evidence adduced in these proceedings by FRE is a series of letters from occupants of properties supplied by FRE, who declare themselves satisfied with the property supplied. In one case the occupant's letter complains of being told, apparently by a Council officer, that he had to move from his property within two hours.
The Overarching Agreement
"Mrs Barker states, at paragraph 4 of her statement, that "There has never been an over-arching formal agreement with the Claimant [FRE] governing the arrangement. I agree that there has never been a formal agreement, but this is as a direct result of the Defendant [Council] failing to complete the tender process which commenced in 2007, at a cost I understand of £100,000.00. Having said this an established arrangement was undoubtedly in place whereby reliance was placed on the Claimant [FRE] by the Defendant [Council] to provide services to house the homeless on a temporary basis to discharge their responsibilities and the Claimant placed reliance on the Defendant to use its service and to discharge its invoices as they fell due."
"The Claimant [FRE] was never a registered agent because no register exists. The Claimant was one of a number of suppliers of temporary accommodation".
"The arrangements between a housing authority and provider of accommodation is [sic] not underpinned by a specific enactment. It is alleged that the Respondent has terminated the contract between the parties for supply of housing ("the Contract") without adequate reason. Such a commercial dispute is not amenable to judicial review."
As I read it the Council's reference to "the contract between the parties for supply of housing" is a reference to a contract for the supply of particular housing, based (as the Council states later in the same document) on the self-certification form and the licence agreement (both of which relate to particular properties). It is not an agreement relating to important and large-scale statutory duties cast upon the Council, in accordance with which FRE will act as the Council's agent and service provider.
Judicial Review of a Network of Contractual Decisions
"If he could do so, it would place a party who contracts with a public body in an unjustifiably more privileged position than a party who contracts with anyone else, and a public body in an unjustifiably less favourable position than any other contracting party"
"in proceedings for judicial review … the persons who have a sufficient interest in the matter shall include any potential contractor".
Section 19(9) provides that nothing in section 17 or in subsection 19(1) implies that the exercise of any function regulated by that action may not be impugned by judicial review. It is clear from this wording alone that section 19(9) does not create a right to proceed by way of judicial review when this would not otherwise be the case. What section 19(9) does is to make it clear that judicial review is not precluded by the wording of sections 17 or 19(1) of the 1988 Act.
Barrett was another case in which a contractor, removed from lists maintained by a public authority, applied for judicial review of the decision to remove it. Jackson J concluded that the Council had no justification for striking the applicants off the list of approved tenderers and that the applicants' name must be restored.
"following the inspection your company will be advised, in writing, of the inspection carried out, the contraventions (if any) and the necessary remedial works to ensure that the property complies with the Council's adopted enforcement standards for all private sector housing".
It is fairly to be inferred into that letter that if FRE were to conduct any of the remedial works identified as necessary in the course of such inspections, so as to bring the relevant property up to the Council's enforcement standards for public housing, the Council would consider such property as suitable for its use in providing public housing. But the decision of 16 June 2008 intervened before the inspections were completed. It would be unfair, and contrary to the expectation legitimately created for the Council to encourage FRE to incur expenditure in bringing property up to the Council's standard without permitting FRE to recoup that cost by licensing it to the Council or (if this cannot be done) by defraying the cost actually incurred by FRE in reliance upon the Council's letter.
The Claim in Contract
"Notwithstanding the lack of formal agreement between the Claimant and the defendant, the Claimant asserts that by virtue of the consistent course of dealings between them and not least the scale and value of the accommodation services supplied by the Claimant, a contract may be implied, and has thus arisen between the parties"
"The period of notice to be given is not specified in the licence, but the Claimant says that it is to be implied that the period of notice would be reasonable, depending in each case on the circumstances in which notice was given".
To my mind, a licence agreement excludes any period of notice when stating that "The licence is terminable by either party on receipt of written notice at any time". In cases such as the present one, the exclusion of a period of notice is not only comprehensible; it is essential. FRE and the Council must have known that occupants of the accommodation supplied to the Council by FRE were liable to require it, and to depart from it, with little or no notice. For this reason FRE raised no objection when the Council wrote to it stating that it was terminating a licence agreement with immediate effect. I am certain that the Council would never have entered into an agreement with FRE (or anyone else) to take a licence of accommodation subject to an implied term that the licence should be terminable upon a variable period of notice.
basis of contract rather than judicial review, I would have granted permission for the case to continue as though pleaded in contract. But as I do not consider that this claim could succeed on a contractual basis, I do not grant that permission. My conclusion is that the claim must be dismissed in its entirety. It is therefore ordered that the claim shall be dismissed. It is declared that the Defendant's decision of 16 June, 2008 to terminate its arrangements with the claimant was not unlawful and that no claim for damages in private law arising from this decision can succeed. The Claimant shall pay the Defendant's costs which are to be subject to a detailed assessment if not agreed.