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Substantive Review Notes

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Administrative Law: Abuse of Discretionary Power (II): Substantive Review 1

Introduction

1.1 What is substantive review?

It is classically said that judicial review is concerned with procedure, not substance: with the way in which decisions may be taken, not with what decisions may be reached. Hence the traditionally process-oriented nature of judicial review. If we consider natural justice (fair hearings, bias), relevant considerations in administrative decision making, procedural legitimate expectations etc.; it is easy to conclude that judicial review is traditionally about process - making sure decisions are made in the right manner. This process-orientated conception of JR finds its justification in the distinction between appeal and review - by confining itself to the decision making process, the court avoids interfering with the merits od a decision, thereby reducing the scope for judicial usurpation of the executive function. But has judicial review ever really lived up to this ideal (if indeed it is an ideal)?
Consider, for example, the courts' willingness to engage in relatively interventionist review in fields such as:Improper purposes: R v Secretary of State for Foreign and Commonwealth Affairs, ex parte World Development Movement Ltd [1995] 1 WLR 386Statutory interpretation: Anisminic Ltd v Foreign Compensation Commission
[1969] 2 AC 147 (and the line of case law generated by Anisminic)Application of statutory criteria to facts: Khawaja v Secretary of State for the Home Department [1984] AC 74; R (A) v Croydon London Borough Council
[2009] UKSC 8, [2009] 1 WLR 2557

The law of JR has clearly not wholly avoided examination of the outcomes of the decision-making process. Further than propriety of purpose and questions of fit, the test of reasonableness has long imposed a substantive as opposed to procedural limitation on decision makers. Substantive review is review of the decision itself, but this does not necessarily amount to merits review. When we look at outcomes of the decision making process by engaging in substantive review, some important questions arise. What are the criteria we should measure outcomes against - rights, values? What standard should we hold them to in order to decide on their legality -correctness, proportionality, or reasonableness? There is always also always the risk of engaging in merits review through the 'back door'. Furthermore, any determination as a result of substantive review naturally attempts to close off unlawful outcomes - but this might have separation of powers implications, particularly in binary cases. It involves an inroad into the substantive options available to the decision maker.

1.2

The orthodox test

There are two main ways in which we can talk about substantive review - proportionality and reasonableness. The latter is the background to the former. The unreasonableness test was classically laid down by Lord Greene MR in Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation [1948] 1 KB 223 at 229 and 234: The case revolved around the statutory power granted to local authorities by the Sunday Entertainments Act 1932. Local authorities had the power under the act to authorise cinema opening on Sundays subject to whatever conditions they thought fit to impose. They imposed such a condition - no Under-15s would be able to visit the cinema on Sundays. Held, Lord Greene MR: The effect of the legislation is not to set up the court as arbiter of what is the right decision - as long as the local authority was acting within the 'four corners of its jurisdiction', it is the local authority's decision to make and the court cannot interfere. We can see right away that underlying this decision is the separation of powers - it is a conscious decision of the court not to intrude on the decision-making remit of the executive. Greene suggests that there are two categories of unreasonableness - which can broadly be described as process-oriented and substantive:?

Process-oriented unreasonableness: o The decision maker must direct himself properly in law; o Consider relevant considerations; o Exclude irrelevant matters. Substantive unreasonableness: o Decisions which are wholly absurd - e.g. dismissing the red-haired teacher because of her red-hair; o Where there is evidence of bad faith; o Evidence of extraneous considerations.

Lord Greene says though that 'all these things run into one another'. One of the difficulties here then is that when people refer to 'unreasonableness' they might be talking about these procedural forms that would now fall under other grounds of judicial review. Our concern is about substantive unreasonableness. In terms of this substantive unreasonableness, the orthodox formulation was stated as:
... something so absurd that no sensible person could ever dream that it lay within the powers of the authority ... [A] conclusion so unreasonable that no reasonable authority could ever have come to it Compare Lord Diplock's "irrationality" test, as set out in Council of Civil Service Unions v. Minister for the Civil Service (The GCHQ Case) [1985] AC 374 at 410: By 'irrationality' I mean what can by now be succinctly referred to as 'Wednesbury unreasonableness' ... It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question could have arrived at it.

The orthodox formulation then clearly classifies an unreasonable decision as one which is truly exceptional. There is a question of why the level of unreasonableness is pitched so high.

2 Unreasonableness

2.1 Wednesbury - appearance and reality

Are the Wednesbury and GCHQ tests misleading? Consider the view of Wade and Forsyth: Taken by itself, the standard of unreasonableness is nominally pitched very high
... It might seem from [the language of the tests] ... that the deliberate decisions of ministers and other responsible public authorities could almost never be found wanting. But ... there are abundant instances of legally unreasonable decisions and actions at all levels. This is not because ministers and public authorities take leave of their senses, but because the courts in deciding cases tend to lower the threshold of unreasonableness to fit their more exacting ideas of administrative good behaviour. Similarly, Jowell and Lester, 'Beyond Wednesbury: Administrative Law' [1987] PL 368 at 372 say:

Substantive

Principles

of

[Wednesbury] seeks to prevent review except in cases where the official has behaved absurdly ... In practice, however, the courts are willing to impugn decisions that are far from absurd and are indeed often coldly rational. Were the courts only to interfere with decisions verging on the insane, a zone of immunity would be drawn around many oppressive or improper decisions that are in reality vulnerable to judicial review. There is a suggestion that the courts may not be as good as their word in applying the test, however. W&F argue that courts are more willing to strike decisions down than their rhetoric suggests - they impose 'more exacting standards'. Jowell and Lester say that the decisions need not 'verge on the insane'. The explanation for this is relatively straightforward. They are subject to the pull of two competing forces. On one hand, they place great important on maintaining the distinction between appeal and review, they don't want to be seen on arbitrating on the merits of decisions in order to maintain the separation of powers - the initial justification for the test remains a strong factor. Similarly however, they clearly also have a desire to intervene where they perceive bad administration. Are judges really more ready to intervene than the rhetoric suggests? See, eg, Hall and Co. Ltd. v. Shoreham-by-Sea Urban District Council [1964] 1 WLR 240; R. v. Hillingdon London Borough Council, ex parte Royco Homes Ltd [1974] QB 720. For comment, see Laws, 'Wednesbury' (in Forsyth and Hare (eds), The Golden Metwand and the Crooked Cord (Oxford 1998).

2.2 Different formulations of the Wednesbury test

The rhetoric is variable, too. Not all courts have adopted the same formulation of the test. Consider:Secretary of State for Education v. Tameside Metropolitan Borough Council
[1977] A.C. 1014 at 1064, per Lord Diplock (cf Lord Diplock's GCHQ formulation, above)

There was an alternative approach to unreasonableness: "conduct which no sensible authority acting with due appreciation of it's responsibilities would have decided to adopt".R. v. Chief Constable of Sussex, ex parte International Traders' Ferry Ltd. [1999]
1 All E.R. 129 at 157, per Lord Cooke

"Whether the decision in question was one which a reasonable authority could reach".This is clearly a more moderate formulation of the unreasonableness test - but this approach clearly begs a question - how do we tell whether a decision is one that a 'reasonable authority' would reach?

This might look like a semantic difference - they are just using different words. Elliott suggests that this is not the case - it goes much deeper, touching deeply different opinions about the relationship between the court and decision maker.

2.3 Wednesbury - a context-sensitive test

Does the large number of formulations of the unreasonableness test mean that this area of administrative law is simply incoherent? Or do the different versions of the test reflect a set of principled distinctions which condition the courts' approach to substantive review? Consider the view of Laws, 'Wednesbury', op cit at 186-187: On the surface at least the test of unreasonableness or irrationality ... is monolithic; it leaves no scope for a variable standard of review according to the subject-matter of the case ... But in fact the courts, while broadly adhering to the monolithic language of Wednesbury, have to a considerable extent in recent years adopted variable standards of review [to suit the subject matter of the case before them]. There was an idea emerging in the 80s and 90s of review of 'variable intensity' review. Laws said that a multiplicity of formulations might not imply chaos if there are principled differences between the courts' approaches. Perhaps intensity of review varies according to the contrast, and Wednesbury is no longer a 'monolithic' standard of review. There are three things that the court has to take into account when deciding how the variable intensity should be 'calibrated'.

1. Institutional competence - less intensive approach to review here the court lacks relative expertise

2. Democratic considerations - does the decision amount to a value decision where the view of elected decision makers deserve respect

3. The more fundamental the right or value, the stronger the case for intervention (and equally the less important the former two considerations are). What is 'super-Wednesbury' review, and when does it apply? In some situations the courts have exhibited a willingness to intervene only if he decision in question crosses an especially high threshold of unreasonableness, sometimes referred to as 'superWednesbury'. See R. v. Secretary of State for the Environment, ex parte Hammersmith and Fulham London Borough Council [1991] 1 AC 521 at 597, per Lord Bridge:
... since the statute has conferred a power on the Secretary of State which involves the formulation and implementation of national economic policy ..., it is not open to challenge on the grounds of irrationality short of the extremes of

bad faith, improper motive or manifest absurdity. Both the constitutional propriety and the good sense of this restriction seem to me to be clear enough. The formulation and implementation of national economic policy are matters depending essentially on political judgment. The decisions which shape them are for politicians to take ... If the decision has been taken in good faith within the four corners of the Act, the merits of the policy underlying the decisions are not susceptible to review by the courts and the courts would be exceeding their proper function if they presumed to condemn the policy as unreasonable. The Thatcher government had used powers to limit tax in certain areas. There was a decision by the Environment Secretary which had the effect of imposing financial penalties upon local authorities regarded as extravagant or wasteful - he essentially limited their spending. The councils went to court to test the legality of these decisions. Lord Bridge applied a standard higher than that of ordinary Wednesbury - he said the court should intervene only if a very high threshold of unreasonableness was crossed, i.e. bad faith, improper motive or absurd consequences indicative of the minister 'taking leave of his senses'. See also R. v. Secretary of State for the Environment, ex parte Nottinghamshire County Council [1986] AC 240. What led the House of Lords to adopt such a hands-off approach in these cases? For discussion of this point, see R (Asif Javed) v. Secretary of State for the Home Department [2001] EWCA Civ 789, [2002] QB 129 at [49], per Lord Phillips MR. Why adopt this approach? On the facts, the Minister's decision had been endorsed (as required by the relevant legislation) by a resolution of the House of Commons. While such approval doesn't elevate a policy to the level of legislation such that it is protected by parliamentary sovereignty, both Lords Bridge and Scarman ascribed great importance to parliament's involvement. The complexity of the issues at stake was the other key reason cited for applying a higher standard of substantive review. In Asif Javed Lord Phillips suggested that it is this latter factor that was the better justification for the unusually hands-off approach adopted - the subject matter was that of a difficult balance between economic and political considerations, the kind of decision that a court should not interfere with on even an (already quite restrictive) substantive Wednesbury basis. For a recent example of the super-Wednesbury test being applied, see R (Rotherham MBC) v Secretary of State for Business, Innovation & Skills [2014] EWHC 232 (Admin). Rotherham is a very recent decision citing these cases. The case concerned the allocation of EU structural funding as between the four constituent countries of the UK and the English regions. One of the grounds of challenge was a challenge on rationality, which failed. [N.B. The Public Sector Equality Duty challenge under the Equality Act 2010 actually succeeded, but isn't relevant here.]
The court said that this was a case involving political policy and macroeconomic judgment at the highest level. The court should be loathed to interfere in cases like this, and would only do so if a very high threshold of unreasonableness was established
- super-Wednesbury. Elliott: Public Law For Everyone entry; Feb 17th 2014: This rightly recognizes that---particularly in cases lacking a specific human rights dimension---there may still be a constitutional case for deference to the views of democratically-accountable decision-makers. I am far from certain,

however, that rigid differentiation between Wednesbury and proportionality, and between different types of Wednesbury review, are the best way of conceptualizing what is going on in cases like this. Nor I am convinced that Stewart J is right to suggest that the notion of justification has no role to play in cases that cannot be approached through a proportionality lens: after all, what can testing the reasonableness of a decision amount to if not determining whether there exist reasons capable of supporting it?
What is 'sub-Wednesbury' review, and when does it apply? We see this emerging particularly in the 1990s, immediately before the HRA comes into force. See, eg, R. v. Secretary of State for the Home Department, ex parte Bugdaycay [1987] AC 514 at 531, per Lord Bridge; R. v. Secretary of State for the Home Department, ex parte Brind
[1991] AC 696 at 748-749, per Lord Bridge. In Brind, Lord Bridge built on his Bugdaycay decision, and for the first time explicitly acknowledged the possibility of a more rigourous form of review in some contexts - here it was in the context of Art. 10. Although their Lordships didn't apply the right directly (the ECHR hadn't been incorporated yet), the existence of the right could lead the court to determine that a decision was unreasonable even where it wouldn't qualify under an orthodox conception of Wednesbury. Note also R. v. Ministry of Defence, ex parte Smith [1996] QB 517 at 554, per Sir Thomas Bingham M.R. (quoting, with approval, the submission of David Pannick QC): The court may not interfere with the exercise of an administrative discretion on substantive grounds save where the court is satisfied that the decision is unreasonable in the sense that it is beyond the range of responses open to a reasonable decision-maker. But in judging whether the decision-maker has exceeded this margin of appreciation the human rights context is important. The more substantial the interference with human rights, the more the court will require by way of justification before it is satisfied that the decision is reasonable in the sense outlined abov e. The claimants were dismissed from the armed forces on the sole ground that they were of homosexual orientation. The claimants challenged the decisions to dismiss them and the policy on which those decisions were based, arguing inter alia that they were irrational. (Also below). The decision must be 'beyond a range of reasonable responses'. The more the decision interferes with human rights, the more the court will require by way of justification before it is satisfied that the decision is reasonable. One criticism here is that it was not clear where this test would apply, and where ordinary Wednesbury would apply. On the context-sensitivity of the Wednesbury doctrine, and the theoretical considerations underpinning its flexible application, see Laws, 'Wednesbury', op cit; Jowell, 'Of Vires and Vacuums: Judicial Review in Constitutional Context' [1999] PL 448; Elliott, 'The Human Rights Act 1998 and the Standard of Substantive Review' [2001]
C.L.J. 301. 'Sub-Wednesbury' review may seem irrelevant today, given that its principal application was in the human rights field---meaning that it has been largely overtaken by the proportionality test adopted under the influence of the Human Rights Act 1998 (on which see below). To an extent the test has become irrelevant, because the HRA takes care of cases where Human Rights are at stake. That does not though mean that the idea of variable Wednesbury is dead. However, it is clear that there are other areas in which the sub-Wednesbury test is used (whether or not it is described as such).

In this regard, consider R (Bradley) v. Secretary of State for Work and Pensions [2007]
EWHC 242 (Admin)); [2008] EWCA Civ 36, [2009] QB 114, in which the courts were asked to review the legality of Ministers' refusals to accept findings made by the Parliamentary Ombudsman, and in which the courts equated Wednesbury unreasonableness with the absence of 'cogent reasons'. There was a reduction in minimum asset requirements for individuals to apply to contribute to pension funds, and the government had supplied potentially misleading information pertaining to the protection afforded by the new regulatory arrangements. The parliamentary ombudsman said that the government was guilty of maladministration occasioning injustice. The minister rejected these findings. The question was whether this decision to reject the findings was unreasonable. The claimants won - an unusual outcome in Wednesbury cases. The court said that a decision will be unreasonable unless there are cogent reasons for making it. What the court may have been doing here was ensuring that the government had limited discretion to reject the conclusions of ombudsmen. This illustrates that the Wednesbury test's capacity to supply a stricter than usual form of scrutiny is not limited to HR cases - so it's eclipsing by the HRA in these contexts doesn't mean it is no longer of any relevance. Does this amount to 'sub-Wednesbury' review? Note also the far less interventionist approach adopted in R (Equitable Members Action Group) v. HM Treasury [2009] EWHC 2495 (Admin), in which the court was asked to quash not a rejection of the Ombudsman's findings, but of her recommendations. Here there was a rejection not of conclusions but of recommendations. The court decided not to apply the 'cogent reasons test' from Bradley. The rejection of recommendations was only reviewable on conventional rationality grounds. The explanation is that the separation of powers argument was weightier on these facts. If they were to follow the recommendations they would have to spend 100s of millions of pounds - the allocation of large amounts of public money, a political and economic decision that the court should not interfere with.

2.4 Evaluating the Wednesbury principle

The debate about whether English courts should adopt more intrusive principles of review such as proportionality tended to centre upon arguments as to the adequacy of the Wednesbury test. Here, we consider some of the main arguments for and against, which still provide an important context in which the present law - which does embrace proportionality - must be understood. There are many commentators who suggest that it isn't hugely reasonable - lots of people argue that it should be replaced with a different standard of substantive review; typically proportionality.

2.5 Support for the Wednesbury principle

Support for the Wednesbury principle tends to focus upon the distinction between appeal and review. What is the distinction between appeal and review? See Secretary of State for Education v. Tameside Metropolitan Borough Council [1977] A.C. 1014, per Lord Russell. Lord Russell said in Tameside that he had no opinion on which system (State v Grammar School) was better. That was beneficial - because it would have nothing to do

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