Legitimate expectation — Judicial review – Remedy — Claimant applying for grant towards erection of new building – Defendant predecessor giving approval in principle Defendant refusing approval owing to lack of funds — Claimant seeking judicial review of defendant’s decision on basis of legitimate expectation of final approval — Whether claimant having good public law case on legitimate expectation — Application dismissed
At the material time, the Learning and Skills Council (LSC) was responsible for securing the provision of further education (other than higher education) in England; the defendant, its statutory successor, was responsible for making grants to colleges in order to fund capital expenditure. The system for dealing with applications involved two stages: approval in principle (AiP) and approval in detail (AiD)
The claimant had applied for a grant in connection with the erection of a new building and had obtained an AiP. It subsequently failed to obtain an AiD because the LSC had insufficient funds. The claimant had spent a substantial sum of money in working up its application to the point at which it applied for an AiD. Some of that expenditure was reimbursed by the LSC, but £3,728,452, was not.
After it became clear that it would not obtain ain AiD, the claimant issued a claim for judicial review against the defendant seeking reimbursement of the expenditure incurred. It contended that it had a twofold legitimate expectation that: (i) once an AiP had been granted, the application would be dealt with in accordance with the usual and known procedures of the LSC; and (ii) the LSC would be funded and organised in a manner that enabled it to meet commitments given at the AiP stage. The claimant sought compensation for the non-fulfilment of its expectation, arguing that the LSC had made implied representations in its capital handbook and in letters and meetings. The defendant argued that the claimant failed to make out a good public law case founded on legitimate expectation.
Held: The application was dismissed.
Save in an exceptional case, a legitimate expectation founded on a representation required that representation to be unambiguous. If founded on a past practice, it would necessitate a specific undertaking to an individual group whereby its continuance was assured. Abuse of power cases were properly characterised as legitimate expectation cases. However, the expectation was not based on a specific representation, but was of a more general kind, namely that a public authority would not act so unfairly that its conduct amounted to an abuse of power. Cases of legitimate expectation not founded on a representation were rare. The requirements for legitimate expectation in public law were sufficiently developed to stand separately from private law doctrines such as estoppel, and should do so, being more sensitive and tailored to the particular context of public law. Accordingly, detrimental reliance was not essential to make out legitimate expectation, although it remained highly relevant: R v Inland Revenue Commissioners, ex parte MFK Underwriting Agents Ltd [1990] 1 WLR 1545 applied; R (on the application of Association of British Civilian Internees (Far East Region)) v Secretary of State for Defence [2003] EWCA Civ 473; [2003] QB 1397 and R (on the application of Niazi) v Secretary of State for the Home Department [2008] EWCA Civ 755 followed.
Maladministration was not a ground for judicial review. The question was whether the public body had acted unlawfully. In deciding what, if any, relief should be granted, the court would take into account (i) whether the decision being challenged was in the macro-political field; (ii) whether it involved social or political value judgments as to priority of expenditure; and (iii) the nature and clarity of the promise or prior practice in question.
The instant case did not involve an unambiguous statement of the kind required to found a legitimate expectation. Nothing in the handbook implied hat, once an AiP had been obtained, the availability of funds to the LSC became irrelevant. Further, the court was unable to derive from further statements an implied representation that, if an application for a capital grant were to be made by the claimant and an AiP were to be obtained, the availability of funds would be irrelevant in determining an application for an AiD.
Furthermore, throughout the process of applying for an AiD, the claimant’s officers had appreciated that they were proceeding at the risk of failure. It would be remarkable if, after the risk materialised, a claim based on legitimate expectation of success were to be established.
Peter Knox QC and Ximena Montes-Manzano (instructed by the legal department of the Grimsby Institute of Further and Higher Education) appeared for the applicant; John Randall QC and David Warner (instructed by the legal department of the Young People’s Learning Agency) appeared for the defendant.
Eileen O’Grady, barrister
