In R (Adams) v Commission for Administration and a number of Local Commissioners for England  EWHC 2972 (Admin) (11 November 2011) the Claimant had complained to the Local Government Ombudsman on a housing issue. The Local Government Ombudsman facilitated a “local settlement” and discontinued the investigation without issuing a report. The Claimant argued that the discontinuance/failure to report was unlawful. The Court rejected those arguments, but found that the Local Government Ombudsman’s duty to issue a statement of reasons was not discharged by referring back to past correspondence. The Court said that the past practice, prior to 2010, of not issuing such statements was wrong. On the facts, however, having regard to the passage of time since the decision, the Court refused to grant any substantive relief and granted a declaration.
There was also a challenge to the refusal of the Local Government Ombudsman to recommend the local authority to pay legal costs arising from the complaint. The Claimant had in fact not paid anything towards her legal costs as her solicitors were acting for them under the Legal Help scheme, part of the Community Legal Service. This allowed her solicitors to claim only about a third of the costs they would have recovered if acting at market rates under the Legal Representation scheme if an inter partes costs order were made. It was argued that the Ombudsman could have awarded costs under s. 31(2A)(b) of the Local Government Act 1974 which allows recommendations “to prevent injustice being caused in the future in consequence of similar maladministration in connection with the exercise of the authority’s administrative functions”. The Court rejected this saying:
“48. … It involves saying that for Lambeth to have to pay costs would “prevent injustice being caused in the future in consequence of similar maladministration” by the Council. If this means that it would be a deterrent and make them behave better in future (as the Law Society suggested to the Select Committee), the answer is that it might, but this is wholly speculative. Instead, by transferring legal costs from the LSC’s budget to Lambeth’s it might simply reduce the amount available for other Council services such as housing; the number of staff might well have to be cut; and those left might carry greater burdens and make more mistakes. I accept that the LSC’s budget is under great pressure, but so are the budgets of local authorities.
49. The alternative to the deterrent argument is the more positive one that injustice through similar maladministration would be prevented in the future by assisting firms such as Pierce Glynn to continue to take on complaints of this kind. In order to make a direct financial difference to Pierce Glynn this depends on demonstrating not merely that the Ombudsman erred in declining to recommend reimbursement of their costs at Legal Help rates (£48.50 per hour), but that she should have recommended payment at Legal Representation inter partes rates. This seems to me an even more strained interpretation of the subsection. Legal Representation is not available in complaints to the Ombudsman. If solicitors take on such work it has to be at Legal Help rates. The client cannot then be asked to pay at a higher rate. If Mr Buley were right it would be open to anyone in a relatively complex dispute with their local authority (for example, over entitlement to a benefit) to consult solicitors under the Legal Help scheme and for the solicitors then, with the support of the client, to seek a recommendation from the LGO for reimbursement at market rates. This would erode the distinction between Legal Help and Legal Representation in a very large number of disputes with public authorities, and involve a still greater transfer of public resources towards legal services than that discussed in the previous paragraph. Many would consider this a desirable outcome and one which would prevent injustice. But in my judgment it is not what Parliament had in mind in 2007 in enacting what is now section 31(2B) of the 1974 Act.”
James Maurici appeared for the Local Government Ombudsman instructed by DAC Beachcroft.
Tim Buley appeared for the Claimant instructed by Pierce Glynn.