Alansi, R (on the application of) v London Borough of Newham [2013] EWHC 3722

The Claimant (Ms Alansi) was a single mother of four children with a medical condition. Following a representation that she would remain a ‘Priority Homeseeker’ in the Defendant’s (Newham Council) allocation scheme, she decided to accept an offer of ‘private rented sector’ accommodation by the Defendant under section 193 of the Housing Act 1996. Whilst the representation was made outside the formal terms of the Defendant’s policy documents, it was evident that its purpose was to induce homeless applicants to accept ‘private rented sector’ accommodation. However when the Defendant altered its policy, despite adopting the appropriate procedures and undertaking the necessary consultation measures, this meant that the Claimant lost her ‘Priority Homeseeker’ status.

The Claimant submitted that the representations made by the Defendant, regarding her status, gave rise to a substantive legitimate expectation such that the subsequent policy adjustment constituted an abuse of power.

The Court began by repeating the finding in R v IRC Ex parte MFK Underwriting that a ruling or statement relied upon to found a legitimate expectation must be ‘clear, unambiguous and devoid of relevant qualification’. In evaluating whether the Defendant’s representation fulfilled such criteria, the Court rejected the Defendant’s submission that the relevant representations should be interpreted in the same way as contractual documentation. They argued that whilst the law of contract assumes a ‘measure of equality’ which makes it appropriate to adopt the objective ‘reasonable person’ view, where a public body makes statements to an individual, the ‘assumption of equality’ is without application. This was because it was the understanding of the individual that mattered. The Court therefore sought to discover the meaning that the Defendant’s statement would have had to the Claimant, taking into account any relevant background knowledge that the Claimant may have had at the time. As the Claimant was considered ‘an unsophisticated member of the public’, without any ‘special knowledge or professional understanding’, it was concluded that the representations were clearly to the effect that she would retain her previous status and would be entitled to bid for permanent accommodation without limitation as to time. Additionally, the possibility of there being an implied qualification within the assurance in relation to potential future changes in policies was rejected by the Court. This was because such an implication would contradict the express assurance that the retention of the Claimant’s status would continue for as long as she continued to reside in the relevant accommodation.

Having agreed that a lawful promise had induced a legitimate expectation of a substantive benefit, the Court then had to decide whether the frustration of the expectation was so unfair that any policy alteration amounted to an abuse of power. Rather than adopting a Wednesbury irrationality review, the Court were required to weigh the requirements of fairness against any overriding interest relied upon for the change of policy. A Defendant’s promise, as well as an ‘abuse of power’ challenge, would therefore only be denied where their legal duty was a proportionate response, having regard to the aim pursued by the public body in the public interest. This proportionality assessment involved drawing together various key considerations within the case, including detriment, reliance and the nature of the policy.

Regarding ‘reliance’, the Court found no substantial basis for an argument that the representations were not relied upon by the Claimant. The Court pointed to evidence submitted by the Claimant, as well as the fact that the assurances served as an inducement to the Claimant, as key indicators of reliance. Also, given that the Claimant had already bid for permanent accommodation before accepting the qualifying offer and did so again in the period after moving to her present accommodation, this showed that not only did she consider the assurance, but she also acted on it. And finally, reliance was once again presumed given that when she was informed of the change in policy, she requested the review of the decision and later issued proceedings to challenge it.

The ‘detriment’ consideration however proved far more complex. On the one hand, there was reason to believe that by accepting the qualifying offer, the Claimant incurred a detriment in losing her position on the Defendant’s housing ladder. However, when considering the benefits that the Claimant nonetheless derived from this adjustment, the speculative possibility of this detriment appeared more theoretical than real. Whilst the acceptance of the qualifying offer led to the cancellation of the Defendant’s section 193 duty to the Claimant, as well as her right to bid for permanent accommodation under the allocation scheme, the Court found that the effect of this change in policy was not entirely detrimental. For instance, the Claimant was placed in suitable accommodation far sooner, with at least some security of tenure, and was protected by the Defendant’s section 193 duty if she were to become homeless. And whilst the Claimants contended that detriment was still incurred by the loss of accrued time spent on the priority ladder, in actuality the Claimant was merely deprived of the possibility that she might at some unknown date in the future be successful in obtaining permanent council accommodation. However, despite the absence of detriment on the facts of the case, the Court maintained that ‘detriment’ was simply a factor to be taken into account when considering whether the balance struck by the public authority was an abuse of power. Therefore, in accordance with Bibi, it did not necessarily follow that the absence of detriment cannot render it unfair to renege on a legitimate expectation.

The final key consideration related to the nature of the policy area in which the adjustment took place. Whilst the relevant assurances were not formally recorded within the Defendant’s allocation policy, the Court adjudged that it still remained part of the central government’s ‘allocation of housing’ policy. This was considered to be a ‘core political policy area’ because of the way in which it was driven by ‘limited supply, heavy demand, and central government pressure’. As a result, there was a need for the Court to be cautious before substituting its own judgment for that of the democratically elected local authority about what was proportionate. Here, the local authority was under an obligation to establish an appropriate balance between the interests of certain individuals and the role of the public authority in formulating and implementing policy for the interests of the wider community. The Court found that this balance had been achieved, given that the policy change was motivated by a need to provide suitable housing for as many people as possible, prioritising in favour of those most in need of it. This supports the finding in R v The Independent Assessor, Ex parte Bhatt Murphy that a public authority will not be bound by the law to continue adopting a policy that it has chosen to alter, because public authorities characteristically enjoy wide discretions which it is their duty to exercise in the public interest. And whilst the Claimant contended that the change could not be justified as it did not affect the public at large and instead only impacted upon approximately 400 people, the Court stated that this ignored the wider impact of changes to the allocation scheme in overlooking those who subsequently moved along the priority ladder following the direct impact of the change upon those 400 people. The court therefore concluded that they must take special care in such cases, given the nature of the policy area in question, to avoid passing judgment on actions which are essentially political.

In balancing all of these considerations, the Court concluded that the Defendant had succeeded in displacing the prima facie finding that its conduct was unreasonable and thus constituted an abuse of power. The policy change was found to be a proportionate response to a pressing concern that struck an equitable balance between contrasting interests.

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