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Court of Appeal allows Secretary of State's appeal in case concerning natural justice and the procedure inquiry rules; and deprecates "the fair crack of the whip" test

DATE: 15 Apr 2014

The Court of Appeal today allowed the Secretary of State’s appeal from the decision in Hopkins Developments Ltd v Secretary of State for Communities and Local Government [2013] EWHC 1783 (Admin). Part 7.

The background was that Hopkins applied for planning permission to construct 58 dwellings on a site at Wincanton. The District Council refused planning permission on six grounds, four of which subsequently became inapplicable. Hopkins appealed under section 78 of the 1990 Act, but the Inspector dismissed the appeal. Hopkins was aggrieved because the Inspector relied on two matters (sustainability and character/appearance) which he had not identified either before or at the outset of the inquiry (in rule 7 and rule 16 statements) as main issues.

The High Court quashed the Inspector’s decision on the ground that the Inspector had acted in breach of the rules of natural justice.

The Court of Appeal reversed that decision, because both sustainability and character/appearance were live issues on the evidence. The Court held that the Inspector was not confined by his original stated opinion as to what were the main issues.

Jackson LJ said:

“46. Professor Cane has observed that the language of natural justice has given way to that of “procedural fairness”: see Administrative Law, 5th edition (Oxford University Press, 2011) at page 70. A number of other textbook writers also favour the language of procedural fairness.  I readily accept that the principle of natural justice which is in play in this case is an aspect of procedural fairness. Nevertheless, I shall continue to use the time-honoured phrase “natural justice” since that is how counsel have argued the case.

47. I would formulate the principle of natural justice or procedural fairness, which is in play in this appeal, as follows. Any participant in adversarial proceedings is entitled (a) to know the case which he has to meet and (b) to have a reasonable opportunity to adduce evidence and make submissions in relation to that opposing case.

48. The House of Lords’ decision in Fairmount Investments Ltd v Secretary of State for the Environment [1976] 1 WLR 1255 illustrates the operation of this principle. Fairmount owned a number of houses which the London Borough of Southwark proposed to demolish on the grounds that they were unfit for human habitation. The Council made a compulsory purchase order, to which Fairmount objected. The Secretary of State appointed an Inspector to hold an Inquiry. The Inspector visited the houses and formed the view that their foundations were defective. This was not a point which the Council had taken, but the Inspector based his decision in favour of the Council upon it. The Secretary of State confirmed the compulsory purchase order. Fairmount challenged that order in proceedings under Schedule 4 to the Housing Act 1957. The Court of Appeal, reversing the trial judge, quashed the compulsory purchase order. The House of Lords upheld that decision. The Judicial Committee held that the Secretary of State’s decision had been made in breach of the rules of natural justice. This was because the inadequacy of the foundations had not been part of the Council’s case; Fairmount had had no opportunity to refute the Inspector’s opinion concerning the foundations.

49. Lord Russell observed at 1265 – 1266 that Fairmount had not had “a fair crack of the whip”. This stark phrase, which now has somewhat strange overtones, appears in a number of authorities both before and after Fairmount. With all due respect to those great jurists who use it, this phrase is not helpful, either as elucidation of the principle or as a guide to its application. What, I think, is meant by not having “a fair crack of the whip” is that there has been procedural unfairness which materially prejudiced the applicant. This pedestrian phrase is perhaps more useful as a test.
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63. In my view the “crack of the whip” metaphor, which possibly derives from horse racing, is now of little assistance in resolving challenges under section 288 of the 1990 Act.”.

The Court of Appeal reviewed a number of first instance authorities on these matters including: Castleford Homes Ltd v Secretary of State for Environment, Transport and the Regions [2001] EWHC Admin 77; R (Tatham Homes Ltd) v First Secretary of State [2005] EWHC 3538 (Admin); [2008] JPL 185; R (Poole) v Secretary of State for Communities and Local Government [2008] EWHC 676 (Admin); [2008] JPL 1774, R (Gates Hydraulics Ltd) v Secretary of State for Communities and Local Government [2009] EWHC 2187 (Admin) at and R (Garlick) v Secretary for Communities and Local Government [2013] EWHC 1126 (Admin).

A copy of the judgment can be found here.

James Maurici QC appeared for the Secretary of State, who was the successful appellant.