Gallagher & Anor, R (on the application of) v Basildon District Council [2010] EWHC 2824 (Admin)

[2010] EWHC 2824 (Admin)Case No CO/4304/2009
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 09/11/2010
Before
MR JUSTICE KENNETH PARKER
THE QUEEN
Between
BASILDON DISTRICT COUNCILDefendant- and –COMMISSION FOR LOCAL ADMINISTRATION IN ENGLANDInterested Party
Mr Lindsay Johnson (instructed by The Children's Legal Centre) for ClaimantsMiss Galina Ward (instructed by Basildon District Council) for DefendantMr Tony Child (instructed by Beachcroft LLP) for Interested PartyHearing Hearing dates: 28 October 2010
Judgment
[1]In this application the Claimants, Paula Gallagher and Mary McCarthy, challenge the decision of Basildon District Council (“the Council”), confirmed following a reconsideration on 25 June 2009, to decline to follow the recommendation of the Local Government Ombudsman (“the LGO”), who is the interested party in these proceedings, to pay compensation to the Claimants.[2]This Claim raises two issues. Firstly, if a local authority refuses to follow a recommendation of the LGO, what is the legal test for determining the legality of such refusal? Secondly, was the refusal of the Council to follow the specific recommendation of the LGO in this case lawful in all the circumstances?

Background

[3]The Claimants are travellers; they are members of a community of travellers who live on an unauthorised site in the Council’s area. There is a long planning history to the site. Following the exhaustion of the planning process direct action has been authorised to remove the travellers from this site. In January 2006, as part of the planning process, the Claimants provided the Council with personal information. That information included the names and ages of their children, medical details of the children (including their illnesses, doctors and treatments), copies of letters from medical practitioners treating the children, and information relating to the children’s education. That information was compiled into a report prepared for the Council’s Development Control and Traffic Management Committee. The report was published as part of the agenda for the meeting. The agenda, including the personal information, was made available to the press and public and for that purpose was distributed at the meeting and posted on the Council’s website.[4]In February 2007 the Claimants complained to the LGO about the decision to publish the information. Those complaints asserted that the decision to publish had breached the principles of the Data Protection Act 1998 and violated the Claimants’ rights under Article 8 ECHR and were illegal at common law. It was contended that the conduct amounted to maladministration causing injustice which should be remedied by at least a formal written apology and the payment of reasonable financial compensation to the Claimants. On 18 December 2007 the LGO’s investigator notified the parties of her provisional views and proposals for a local settlement. She found that the decision to publish the information was “not fair, reasonable or proportionate”. She also found that:
“It is an administrative failing in a case as sensitive as this for there to be no advice or record setting out the basis for the decision.”
As to Article 8 ECHR she said:
“If the Council had given more considered attention to the principle of respect for private life enshrined in Article 8 it is likely that it would have reached a more proportionate decision that did not, for example, imperil the privacy of vulnerable children.”
[5]She recommended that the LGO find that there had been maladministration causing injustice and that the Council should, by way of local settlement, offer the Claimants an apology and pay them £300 each. The Council did not accept the proposal but did arrange for a senior officer to send a letter of apology.[6]In the absence of a local settlement the LGO proceeded to publish a report on 9 July 2008. He concluded: “The Council’s decision to publish details of all of the travellers’ medical and educational needs in the report amounts to maladministration. Much of the information in the report was exempt information that should only have been considered in closed session when the press and public are excluded. I am supported in this view by the findings of the Information Commissioner. He ruled that publication of sensitive personal data was likely to amount to a breach of the data protection principles…. My view is that the Council could have chosen to report the information to councillors in anonymised and summarised form or it could have treated it as exempt information and placed it in Part 2 of the meeting in order to prevent the widespread circulation and disclosure of detailed sensitive medical and educational information. It seems to me that this would have been a more proportionate way of handling the information, which would still have achieved the desired aim and which would have led to less interference with the Complainants’ right to respect for their privacy. Accordingly, I conclude that the Council should have given more considered and conscious attention to the principle of respect for private life enshrined in Article 8…. This shortcoming also amounts to maladministration and contributed to the injustice suffered by the Complainants.” (See paragraphs 51-52)[7]As to the nature of the injustice, he found: “All citizens in the Council’s area, whether they are travellers or members of the settled community, need to be confident that the Council will respect their privacy and not disclose personal details of their health or children’s educational needs…. When the Council is entrusted with information that includes the names and ages of young children and the schools they attend there is a self-evident need to handle it with extreme caution…the injustice suffered by the Complainants was….the sense of shock and outrage they felt when they first discovered that the information had been published.” (See paragraph 53)[8]The LGO recommended that the Council should remedy the complaint by arranging for a senior officer to send a letter of apology and pay £300 compensation to each Claimant. As to the decision taken in April by the Council’s committee, he said: “The Council has agreed to send a letter of apology but it refused to accept my recommendation for compensation. I now urge the Council to reconsider its decision and accept my recommendation in full. I am an independent and impartial adjudicator and out of respect for my office I call on the Council to provide a fair and equitable remedy for these complaints.” (See paragraph 54)[9]On 11 September 2008 the Council’s Appeals and General Purposes Committee considered the report and resolved to accept the recommendation to write and apologise but to reject the recommendation for paying compensation. The Minutes record a member of the committee stating that:
“There needed to be a good reason to not support the recommendations of the Ombudsman.”
The decision itself, however, contained no reasons. On 15 September 2008 the Deputy Leader of the Defendant was reported in the local newspaper to the following effect:
“If people felt embarrassed or hurt the Council should apologise… What is done, is done. Today’s compensation culture has gone too far.”
[10]On 12 November 2008 the LGO produced a further report. That report stated that the LGO was very disappointed that the authority did not accept the recommendation. He observed:
“The Commission has published guidance on good practice on remedies that was sent to all councils. One of the general principles set out in the guidance is that a remedy should be appropriate and proportionate to the injustice. It should, as far as possible, put the complainant back in the position he would have been but for the maladministration. However, in many circumstances, this cannot be achieved because particular events have occurred and “the clock cannot be turned back”
. In such cases financial compensation may be the only available approach.” (See paragraph 12)[11]On 5 February 2009 the full Council met to consider the LGO’s second report. They resolved, by a majority, that the Council did not agree with the Ombudsman that a monetary award of any kind would be a fair and equitable remedy in the present case; and secondly that the Council wished to emphasise its respect for the office of the Ombudsman.[12]Following the issue of the present proceedings the Council agreed to reconsider the matter at another meeting of the full Council on 25 June 2009. At that meeting the full Council resolved:
“1. That the Council, having given due weight to the findings of the Ombudsman, do not agree with the Ombudsman that a monetary reward [sic] of any kind would be a fair and equitable remedy in this case because it would not undo the worry and anxiety caused and because the Council’s mistake was rectified immediately and the repercussions feared by the Complainants did not materialise. 2. The Council requests the Chief Executive to send a further letter of apology to the families affected.”
A revised letter of apology was sent by the Chief Executive of the Council on 13 July 2009. In July 2009 the LGO drafted a statement under Section 31(2D) of the Local Government Act 1974 (“the Act”) but has decided not to publish that statement until the determination of these proceedings. The draft text of the statement is as follows:
“I accept that nothing can undo the worry and anxiety the Complainants have suffered. I also accept the Council took prompt action to remove the sensitive information from its website but it is for me to decide whether or not it is appropriate to recommend a payment of compensation. In these cases the compensation is intended to recognise the distress caused to the Complainants which the Chief Executive has now acknowledged they suffered and which is in accordance with the good practice guidance we have published…”

The Statutory Framework

[13]At the time of the Complainants’ complaint to the LGO, i.e. February 2007, the LGO’s power to investigate under Section 26 of the Act arose where a written complaint was made by or on behalf of a member of the public who claimed to have sustained injustice in consequence of maladministration in the exercise of the administrative functions of a local authority such as the Council. Reports of the LGO are governed by Sections 30 and 31 of the Act. The principal duty is that where the LGO completes an investigation then the LGO should send a report to each of the persons concerned. According to Section 30(1D) a person concerned is defined as: i) The Complainant, if any; ii) The person who referred the matter, if any; iii) The authority concerned, and iv) Any other authority or person who is alleged in the complaint or who otherwise appears to the local commissioner to have taken or authorised the action which is or would be the subject of the investigation.[14]Under Section 31 of the Act where the LGO reports that there has been maladministration, a failure in a service which it was the function of an authority to provide, or a failure to provide such a service, then the authority should inform the Ombudsman of the action it has taken or intends to take within 3 months or within such time as the LGO may allow. If the LGO does not receive a response from the authority, is not satisfied with the proposed action outlined by the authority or does not receive confirmation that actions detailed have been undertaken, then the Ombudsman shall issue a further report and make recommendations. As originally drafted, the Act was silent as to making recommendations and as to the effect of a second report. It was Section 29 and Schedule 3, paragraph 7 of the Local Government Act 1988 which first imposed a duty on the authority to consider the second report (see now Section 31(2A) of the Act). Then the Local Government and Housing Act 1989 made provision for the second report to contain specific recommendations as to action that should be taken by the authority. The Act is silent as to the consequences of failing to implement the LGO’s recommendations other than adverse publicity. Where the authority still fails to comply with the recommendations made by the LGO then the Ombudsman can require the authority to publish a statement in two local publications. The statement includes the Ombudsman’s recommended action and any other material the Ombudsman feels necessary (see Section 31(2D), (2E)(a), (2E)(b) and (2F)). However, it need only contain the authority’s reasons for not having taken such action if the authority so requires (see Section 31(2E)(c) of the Act). This allows the authority to state its reasons for not complying with the Ombudsman’s recommendations but does not require it. Accordingly the steps available to the LGO are as follows: i) A statement of reasons where an investigation is not opened or if discontinued or if a report is not issued following an investigation; ii) A normal report; iii) A further report if not satisfied with the reaction to the normal report, including recommendations; iv) The publication of a statement in the local press concerning the LGO’s investigation.[15]It might perhaps be noted at this juncture that in the early history of the legislation there was a significant failure of local authorities to implement the reports of the LGO. At one stage nearly 10 percent of LGO reports were rejected. Currently the rejection rate appears to be about 0.6 percent of all cases. The reduction in the rate of rejection may not be unconnected with the development of the case law in relation to the status of LGO reports. In R v Local Commissioner for Administration for the South, the West Midlands, Leicestershire, Lincolnshire and Cambridgeshire ex parte Eastleigh Borough Council [1988] QB 855 (“Eastleigh”) Lord Donaldson of Lymington MR set out what he considered to be the correct view of the relationship between the local authority and the Ombudsman:
“There is the suggestion that the Council should issue a statement disputing the right of the Ombudsman to make his findings and that this would provide the Council with an adequate remedy. Such an action would wholly undermine the system of Ombudsman’s reports and would, in effect, provide for an appeal to the media against his findings. The parliamentary intention was that reports by Ombudsmen should be loyally accepted by the local authorities concerned. This is clear from Section 30, subsection 4 and subsection 5 which require the local authority to make the report available for inspection by the public and to advertise this fact, from Section 31(1) which requires the local authority to notify the Ombudsman of the action which it has taken and proposes to take in the light of his report and from Section 31(2) which entitles the Ombudsman to make a further report if the local authority’s response is not satisfactory.”
[16]This decision, of course, pre-dated the Local Government and Housing Act 1989 which made specific provision for the second report to contain recommendations as to action that should be taken by the authority (see above). Eastleigh thus establishes that the only way to dispute the findings of the LGO is to challenge the report itself. It is common ground that for this purpose the findings include both the finding of maladministration and the finding of injustice arising from the putative maladministration. The statement of Lord Donaldson of Lymington MR has been reaffirmed by Lord Justice Wall in the Court of Appeal (see R (Bradley) v Secretary of State for Work and Pensions [2008] ECWA Civ 36 [2009] QB 114 (“Bradley”) at 139).[17]The issue whether the findings made by the Parliamentary Commissioner, like the findings made by the LGO, would be binding upon the government arose in Bradley. Bradley concerned the Parliamentary Commissioner’s special report on Occupational Pensions. Several thousand private sector employees had lost their final salary pensions when their pension schemes had been wound up. The Parliamentary Commissioner opened a large-scale investigation into an alleged failure of prudential regulation by the Department of Work and Pensions. The government rejected the Parliamentary Commissioner’s original findings of maladministration. That rejection was then challenged in legal proceedings before the Administrative Court. Counsel for the Claimants conceded that the Parliamentary Commissioner’s recommendations could not be binding on the Secretary of State but argued that the findings were. Bean J at first instance held that the Secretary of State was bound by the Parliamentary Commissioner’s first finding of maladministration, namely that the government had issued misleading official information, and that he could reject that finding only if the finding was itself Wednesbury unreasonable or otherwise legally flawed. In any event Bean J held that it was irrational for the Secretary of State to reject the Parliamentary Commissioner’s findings. Accordingly, Bean J quashed the Department of Work and Pensions’ decision to reject that finding and directed that the decision to reject the first recommendation restoring benefits be reconsidered. The Secretary of State appealed and the Court of Appeal took a somewhat different view about the correct legal test to be applied to the Secretary of State’s rejection of the findings of the Parliamentary Commissioner.[18]The head note so far as that issue is concerned states:
“There was no general rule that findings of fact made in the course of a statutory investigation could only be impugned on the grounds that they were irrational; that findings of maladministration made by the Parliamentary Commissioner for Administration following an investigation under Section 5(1) of the Parliamentary Commissioner Act 1967 were not binding on the relevant minister, and nothing in that Act required the minister to obtain relief by way of judicial review before rejecting them or precluded him, when he was called to account before either House, from explaining as part of his justification for deciding to provide no remedy in respect of the complaint, his reasons for rejecting such findings; and that, therefore, where the minister had been the subject of a finding of maladministration he was entitled to reject it in favour of his own view, provided that his decision to do so was not irrational, having regard to the legislative intention underlying the 1967 Act that those bodies for whose actions there was a minister capable of being called to account by Parliament were to be subject to investigation by the Commissioner.”
[19]In the course of his judgment Sir John Chadwick, with whom Wall LJ and Blackburne J agreed, said that the minister could reject the Parliamentary Commissioner’s findings where he had “cogent reasons” to do so. Specifically, the Court endorsed the following sentence in the skeleton argument for the Claimants in that case:
“The question is not whether the Defendant himself considers that there was maladministration but whether in the circumstances his rejection of the Ombudsman’s findings to this effect is based on cogent reasons.”
[20]The following passages from the judgment of Sir John Chadwick appear to me to be of particular importance:
“40. There is nothing in those passages – or elsewhere in the White Paper – which suggests that, in introducing legislation for the appointment of a Parliamentary Commissioner, the Government intended that ministers (or the complainant) should be bound by findings in any report which the commissioner might think it appropriate to make. The purpose for which the legislation was introduced was to give Members of Parliament – in particular, members of the House of Commons – access to the services of an independent and authoritative investigator as “a better instrument which they can use to protect the citizen”
. But, the protection was to be afforded through “existing constitutional arrangements”. Those existing arrangements are identified in para 4 of the White Paper: they include the procedures of parliamentary questions, adjournment debates and debates on supply, correspondence with ministers, and the ability to bring citizens’ grievances, great or small, to Parliament, “where ministers individually and Her Majesty’s Government collectively are accountable.” “63. As I have said, it seems to me that, once it is accepted (it must be) that the legislative intention which underlies the 1967 Act was that the bodies which were to be subject to investigation by the Parliamentary Commissioner were bodies for whose actions there was a minister capable of being called to account in Parliament, it is impossible to avoid the conclusion that Parliament did not intend to preclude that minister from giving a full and frank account to Parliament of the reasons which had led to the decision to provide no remedy for the complaint; including (if it were the case) the government’s reasons for rejecting the commissioner’s finding of maladministration. But, in a case where the body is one in respect of which there is no minister capable of being called to account in Parliament, there is no basis for that conclusion: indeed the conclusion would be meaningless. With respect to the judge’s view, it seems to me that logic leads to an expectation that there will be a distinction between cases in which effect is to be given to the legislative intention underlying the 1967 Act and cases in which that legislative intention has no application. Further, it may be said that the distinction accords with constitutional principal: the courts must recognise and be sensitive to the principle of mutual respect explained by Donaldson MR in R v Her Majesty’s Treasury Ex P Smedley [1985] QB 657 6 66D:
“It…behoves the court to be ever sensitive to the paramount need to refrain from trespassing upon the province of Parliament, or so far as this can be avoided, even appearing to do so.” “It…behoves the court to be ever sensitive to the paramount need to refrain from trespassing upon the province of Parliament, or so far as this can be avoided, even appearing to do so.”
[21]Wall LJ, agreeing with Sir John Chadwick, put the matter in this way:
“137. Ex p Eastleigh Borough Council was, of course, a case brought under a different statute, the Local Government Act 1974. Quite apart from the different statutory provisions, however, what strikes me as a broader consideration is the clear difference between the remedies provided by the two statutes. Thus under the 1967 Act, a minister who rejects the ombudsman’s findings of maladministration will have to defend him or herself in Parliament, and will be subject to parliamentary control. The ultimate remedy for aggrieved citizens such as the complainants in the instant case, whose complaints to their Members of Parliament have led to the ombudsman’s report, will – ultimately – be through political action rather than judicial intervention. 138. In making these observations, I have not lost sight of the fact that the decision of the minister/Secretary of State to reject the parliamentary ombudsman’s findings of maladministration is itself, capable of being judicially reviewed on conventional public law grounds. However, in this context, the remedy – if the application for judicial review is successful – is procedural rather than substantive. The decision is quashed as unlawful, and the minister must think again. The limitations on judicial review as a remedy do not need to be spelled out. 139. In cases involving the local government ombudsman (“LGO”), the citizen who has invoked his assistance has – in law – no substantive remedy against the local authority concerned if that authority rejects the LGO’s conclusion. It is true that the citizen could apply for judicial review of the local authority’s decision not to implement the LGO’s findings, but the system, as I understand it, depends upon the convention that local authorities will be bound by the findings of the LGO. It must follow inexorably that if a local authority wishes to avoid findings of maladministration made by a LGO, it must apply for judicial review to quash the decision.”
[22]The Divisional Court returned to this issue in R (Equitable Members Action Group) v HM Treasury [2009] EWHC 2495 Admin (“Equitable Members”). Lord Justice Carnwath, giving the judgment of the Court, said this: “65. Discussion: In considering the application of Bradley to the facts of the present case, we agree with Mr. Lewis that the subject-matter of the challenges falls into three distinct categories: i) First, the Government’s rejection of the Ombudsman’s findings (of maladministration or injustice, as the case may be). ii) Secondly, the challenge to the Government’s rejection of the Ombudsman’s recommendation of a compensation scheme. iii) Thirdly, the challenge to the Chadwick Terms of Reference, concerning the Government’s proposal for ex gratia payments.66. As we see it, it is only in respect of (i), the actual findings of the Ombudsman, that the Bradley approach is directly applicable. Although not bound by them, the public body can only reject the findings of the Ombudsman for “cogent” reasons, that is for reasons other than merely a preference for its own view. That is not a precise test, but it would be wrong in our view for us at this level to attempt a further definition of the “cogent” reasons test or to suppose that there is some exhaustive list of such reasons. What is required instead is a careful examination of the facts of the individual case – with the focus resting upon the decision to reject the findings of the Ombudsman, rather than the Ombudsman’s findings themselves.67. Particular factors weighing against rejection in the present case are the complex nature of the Ombudsman’s investigation, together with the fact that her findings were made after taking detailed expert advice, including actuarial advice; and the fact that the public bodies involved in the Ombudsman’s investigation had extensive opportunities to make representations. On the other hand, where it can be demonstrated that the Ombudsman has gone wrong in fact or in law, or where the Government has carried out further work not done by the Ombudsman, the case for rejection may be easier to justify.68. As for (ii), the Government’s rejection of the Ombudsman’s recommendation for a compensation scheme, it was not and could not have been submitted that the recommendation was binding on the Government. There was no serious dispute that in this context the legal test is the conventional one of irrationality or Wednesbury unreasonableness. Further, as the context necessarily entails a consideration of the allocation of resources from the public purse, the Court would be likely to proceed with caution before intervening: see, De Smith’s Judicial Review (6th ed.), at para. 11- 014.” i) First, the Government’s rejection of the Ombudsman’s findings (of maladministration or injustice, as the case may be). ii) Secondly, the challenge to the Government’s rejection of the Ombudsman’s recommendation of a compensation scheme. iii) Thirdly, the challenge to the Chadwick Terms of Reference, concerning the Government’s proposal for ex gratia payments.

Submissions of the Parties on the First Issue

[23]In summary, Mr Johnson, who appears on behalf of the Claimants in this application, submits that a local authority such as the Council may reject the recommendations of the LGO only if the local authority has cogent reasons in accordance with the test propounded in Bradley for so doing. Mr Johnson contends that a local authority may not refuse to implement the recommendations made by the LGO simply because the local authority rationally believes that such recommendations are not fair and reasonable in all the circumstances. Mr Child, who appears on behalf of the LGO (the interested party in this application), supports that submission made on behalf of the Claimants. Both Mr Johnson and Mr Child concede that central government, as broadly understood, may decline to implement the recommendations of the Parliamentary Commissioner under the 1967 Act and that such refusal to implement the recommendations could be challenged only on the ground that such refusal was Wednesbury unreasonable. Such concession would appear to be made properly in the light of the passages from the judgment of the Divisional Court in Equitable Members cited above. However, Mr Johnson and Mr Child contend that the reason why central government, as broadly understood, may decline to follow the recommendations of the Parliamentary Commissioner is that central government is accountable to Parliament and the relevant minister would have to explain and justify before Parliament why he or she declined to follow such recommendations. In other words, the fact of parliamentary accountability leaves the implementation of the recommendations of the Parliamentary Commissioner in the political arena, save where the refusal to implement any such recommendations can be shown to be unlawful according to the test in Wednesbury. At the local level, however, there are no analogous constitutional arrangements. There is no separation of power between executive and legislature, and there is no equivalent accountability of the executive to the legislature. There is, therefore, no good reason why at the local level a local authority such as the Council should not have to show “cogent reasons” if it wished to refuse to follow a recommendation made by the LGO.[24]Miss Ward, on the other hand, who appeared on behalf of the Council submitted that there was nothing in the relevant sections of the Act to which I have referred above that required the Council to implement the recommendations of the LGO. On the contrary those sections showed quite clearly that the only relevant sanction for the failure of the local authority to follow such recommendations was local publicity. So long, therefore, as the decision of the Council to refuse to follow the recommendation was not Wednesbury unreasonable or otherwise flawed on a recognised public law ground, that decision could not be challenged, and in particular the Council did not have to have “cogent reasons” for refusing to follow any such recommendation.[25]Miss Ward argued that the fact that the Council was not accountable in the same way that central government was accountable to Parliament was not relevant so far as the first issue was concerned.[26]On this issue I prefer the submissions of Miss Ward. In my judgment, her interpretation of the relevant statutory provisions is correct. At the outset of the legislation, as explained earlier, the LGO had no power to make recommendations that had legal effect, let alone recommendations that could be rejected only for cogent reasons. That no doubt was because Parliament initially intended, for reasons of policy, that local authorities should have full autonomy to determine at local level what steps, if any, they should take to remedy any injustice identified in the LGO’s report. Parliament then subsequently empowered the LGO to make recommendations, but did not either make such recommendations specifically binding, or alternatively expressly require that local authorities should have “cogent reasons” for rejecting any recommendations, provisions that would reasonably have been expected if such had been the legislative intent. On the contrary, the only express sanction was local publicity, leaving the electors to determine whether the local authority had behaved acceptably in rejecting any recommendation designed to remedy an injustice to a local citizen.[27]Furthermore, I see nothing at all unprincipled in such a scheme. “Findings” are, on authority, binding, but these are either hard-edged findings of fact, established after thorough and independent investigation by the LGO; or they represent an assessment by the LGO of maladministration and injustice which, by reason of his expertise, accumulated experience of local administration and panoramic view of the functioning (and malfunctioning) of local government, he is peculiarly well-equipped to make. However, there is more scope for genuine disagreement on what, if any, steps are required to remedy a particular injustice. There may be a number of options, with varying effects on the use of scarce resources. Local authorities are, of course, accountable to their electors for the use of such resources. It seems to me that Parliament intended that local authorities should be entitled to consider the impact on the fair and efficient allocation of scarce local resources in deciding whether to accept a recommendation of the LGO and, in an appropriate case, to reject such a recommendation because of a disproportionate effect on such resources. This was a factor specifically identified by the Divisional Court in Equitable Members. I accept that the economic impact at local level of a LGO recommendation is likely to be far less than the potential impact of a recommendation made by the Parliamentary Commissioner at the national level, as the cases show, but, on the other hand, local budgets are likely to be proportionately more constrained, and the point made by the Divisional Court has, in my view, considerable force also at the local level.[28]As for the case law, Eastleigh cannot be authority for the proposition that recommendations are binding or that the rejection of recommendations must be based on “cogent reasons” for, as mentioned earlier, at the time of Eastleigh the LGO had no statutory power to make recommendations. In my judgment, Bradley decided the specific issue of whether the findings of the Parliamentary Commissioner were binding (if lawful), as Bean J at first instance had held them to be. Sir John Chadwick, with whom the other members of the court agreed, crafted the test of “cogent reasons” after a comprehensive analysis of the relevant statutory provisions, concluding that to hold such findings to be binding at the national level (as they were at local level) was inimical to long standing constitutional arrangements which were, in turn, reflected in those statutory provisions. As I have already said, the relevant statutory provisions in the present context give no support to the Claimant’s submission. Simply to seek to transpose the rationale that was decisive in Bradley (executive accountability to Parliament) in respect of the specific issue that was before the Court in that case to an entirely different question in this case is, in my view, nothing more than mechanical jurisprudence, which I reject.[29]I am somewhat fortified on the conclusion that I have reached on the first issue by the Law Commission’s Consultation Paper No 196 “Public Services Ombudsmen”. The Law Commission in its Paper analyses the relevant statutory provisions and case law (in a way not dissimilar to my own) and later considers the “status of findings and recommendations”, as follows:
“6.91 The statutory regimes which underpin the actions of the ombudsmen are similar in one particular way. They rely on publicity, whether in Parliament, the National Assembly for Wales or local press, as the primary mechanism with which to encourage the implementation of reports. Within the bare statutory schemes, the final weapon available to any of the ombudsmen is not a binding order or a declaration that the public authority had acted in an illegal manner. Rather, it is the placement of their findings and recommendations in the public sphere. In some cases, the statute requires the authority to publish this. In others, there is a power to place a report before an elected body – either the Houses of Parliament or the National Assembly of Wales. 6.92 The current state of case law in Bradley and Equitable Members Action Group follows this basic principle and effectively leaves courts outside any debate on the merits of recommendations of the Parliamentary Commissioner. In relation to findings, the Government should only reject the Parliamentary Commissioner’s findings when it gives “cogent reasons” for doing so. 6.93 The position, following ex parte Eastleigh and Bradley, in relation to the Local Government Ombudsman is very different. Here the findings of the Local Government Ombudsman are effectively binding unless successfully challenged by way of judicial review. 6.94 The implementation of any recommendation would almost always have an effect on the distribution of public resources. The proper place for such discussions is not in a court or similar body, which would be the ultimate effect of giving them a binding quality. To make recommendations binding would change the nature of the relationship between ombudsmen and those they oversee, removing the proper discussion and the collaborative approach that the original drafters saw as part of the ombudsman process – as we set out in Part 2. 6.95 Therefore, in relation to recommendations, we think that the approach adopted by the courts in relation to the Parliamentary Commissioner is broadly correct. We provisionally conclude that the proper approach to recommendations is as partof the political process.”
[30]The publication of the Consultation Paper raises a further point. It appears to me that the submissions of the Claimant, and of the interested party, invite the Court to superimpose an additional, and important, qualification on the existing statutory regime – namely that local authorities must have “cogent reasons” for rejecting LGO recommendations. There may be arguable policy reasons in favour of that superimposition. But those reasons can be far better and more appropriately explored, and critically examined, in the context of the on-going work of the Law Commission, which is informed by the widest consultation with all interested parties, than by the exercise of the kind of judicial creativity which the Claimants urge on the Court.

The Second Issue: Was the Rejection of the Recommendation Unlawful?

[31]On the second issue, the Claimants, again supported by the Interested Party, submit that the reasons advanced by the Council for rejection of the recommendation simply do not stand up to scrutiny. Miss Ward, for the Council, concedes that no legal criticism can be made of the LGO recommendation. But, she argues, if quod non the LGO had not recommended the payment of compensation, that decision could not have been challenged on Wednesbury grounds; ergo, a refusal by the Council to accept the recommendation cannot be challenged on Wednesbury grounds.[32]That submission, in my view, although logically attractive, is legally flawed. The Council has in this case given reasons why it has resolved to reject the recommendation to pay compensation. The Wednesbury standard of review can be, and is, attuned to the particular context. There is no doubt that in the present context the LGO has very considerable experience in formulating recommended remedies for injustice, and has developed a set of principles in order to ensure that remedies are applied fairly, proportionately and on a consistent basis. The LGO is also above the heat of local political controversy and can, therefore, take an objective and balanced view as to what is fairly and reasonably needed to remedy an identified injustice to the local citizen. The fact that nowadays the recommendations of the LGO are almost invariably followed shows that the system works well in practice.[33]Against that background, it appears to me that if the local authority does provide reasons for rejecting the recommendation, the Court is entitled to examine carefully whether the Council has, first, taken into account relevant considerations and, secondly, has weighed those relevant considerations in a way that a reasonable council should have done.[34]This critical analysis must begin with the LGO report itself. In my view, if a monetary payment is to be recommended, the most relevant considerations are the specific conduct of the local authority and the specific impact of the maladministration on the local citizen. In this case the relevant reports identified these factors. There was a careful evaluation of the Council’s conduct. The LGO acknowledged that the Council had not intended deliberately to infringe the Claimant’s legitimate and important interest in privacy, nor had it acted recklessly. Officials were seeking to balance competing interests: on the one hand, they were seeking to promote open and transparent government, and, on the other, to accommodate the important and legitimate interest of the Claimants. However, that balance was struck in a seriously erroneous way, for there were obvious measures (anonymising individuals and/or dealing with certain limited material in meetings closed to the public) that would both have generated sufficient transparency in the process of decision making, but at the same time would have protected the Claimants’ legitimate interests. Hence there was a proper finding of maladministration. Furthermore, the maladministration had caused direct injury to the Claimants: this was not a case where the Council had failed carelessly to regulate a third party who had inflicted injury on the Claimants – a scenario that has in general caused the courts serious problems in determining whether it is fair and reasonable to impose liability on public authorities to compensate for the resulting loss to the victim.[35]As to the Claimants’ position, the maladministration had caused no physical injury to the Claimants or their children, or financial loss. However, it caused very considerable distress, even if it were relatively transient, and the Council had acted reasonably promptly to put matters right. In the final event, after a somewhat begrudging effort, the Council had apologised appropriately. This was not a case where the Claimants could be restored to their original position, but that is precisely the type of case where the LGO has consistently recommended what is sometimes called “botheration payments”, routinely awarded to cover cases of grave maladministration, where excessive rudeness and malice were involved or exceptional worry and distress caused. In other words, the payment is intended to mark the serious affront to human dignity, as a means by which the wrongdoer acknowledges the extent of the injury, and the victim can both plainly see that the wrongdoer is sincere in the apology, and also receives something to make up for the initial affront. It is accepted that these payments are not intended to restore the victim to an original position, or to compensate for a continuing loss of amenity, and they are typically, as in this case, relatively modest in amount. They are, however, not unprincipled, but rather accord with now well-established practice in this area (see, for example, Carol Harlow, State Liability, pp105-109, referring in turn to A. Ogus, “Do we have a general theory of Compensation?” [1984] Current Legal Problems 29, 37).[36]With this in mind, it is now possible to measure the Council’s response to the recommendation. First, that response (see paragraph 12 above) makes no explicit reference at all to the conduct of the Council. The response recites, almost formulaically, that the Council has had regard to the report of the LGO, but it nowhere acknowledges that the Council had been guilty of maladministration. This is not without importance. First, the “findings” may be legally binding, but those reading and interpreting the decision to reject the payment of compensation are, in my view, entitled to know whether the Council, in rejecting the recommendation, has genuinely accepted that it was guilty of maladministration. Second, this is not a case where the Council can be seen to have evaluated its own maladministration and to have rationally concluded that the seriousness alone of that maladministration would not require the payment of compensation.[37]Secondly, the first reason advanced by the Council for rejecting the payment of compensation was that such payment “would not undo the worry and anxiety caused”. In my view, this reason misses the point entirely. The LGO had recommended a “botheration” payment in this case, in accordance with long-standing practice and sound principles of compensation, precisely because the victims of the injustice caused by serious maladministration could not be restored to their original position. The Council simply did not ask itself the right question, namely, given the nature of the maladministration and of the injustice caused, which is duly acknowledged, is a “botheration” payment (awarded where the victim cannot be restored to her original position) fair and reasonable in this case, given the amount recommended and the likely impact on local resources?[38]Furthermore, even assuming that the first reason was a relevant consideration, to any objective observer seeking to interpret the decision it would appear that this reason, given its prominence and the general history of the matter, was being given very great, if not decisive, weight. Such an interpretation would certainly chime with the public statement of one Councillor (see paragraph 9 above). In my judgment, taking account of established practice and sound principles of compensation, it was not rational to accord such weight to that consideration.[39]Thirdly, although the decision stated that “the repercussions feared by the Complainants did not materialise”, nowhere in the decision is there any acknowledgement that the Complainants did suffer serious distress and anxiety, a highly relevant consideration in determining whether, to use the Council’s own test, it was fair and reasonable to pay compensation. It would appear that the Council was justifying the non-payment of compensation because certain detriments did not arise, without asking itself the relevant question whether it should pay compensation because another kind of detriment did occur. That, in my view, was not a rational way of reaching the relevant decision. Again this was not a case where the Council can be seen to have evaluated accurately the impact of the injustice on the local citizen and to have concluded that the seriousness of that impact did not require the payment of compensation.[40]Finally, no mention is made at all about the amount of the compensation. On the face of it, the amount appeared modest. It means that the Council had set its face against any payment, however token, notwithstanding the nature of the maladministration and the impact of the injustice caused to the Claimants. This again was not a case where the Council, weighing the gravity of the maladministration and the extent of the impact on the victim of the injustice, rationally concluded that payment of the compensation recommended would involve a disproportionate use of public resources.[41]For these reasons, the challenged decision has failed to take into account relevant considerations, has taken into account irrelevant considerations, or has given manifestly disproportionate weight to certain considerations, and does not show the rational quality of response that, in this particular statutory context, is required in law.[42]I, therefore, allow this claim for judicial review and quash the challenged decision.

Cited in 4 later judgments