COMMISSIONERS OF INLAND REVENUE (APPELLANTS)
v.
NATIONAL FEDERATION OF SELF-EMPLOYED AND
SMALL BUSINESSES LIMITED (RESPONDENTS)
Lord Wilberforce
Lord Diplock
Lord Fraser of Tullybelton
Lord Scarman
Lord Roskill
Lord Wilberforce
MY LORDS,
The respondent Federation, whose name sufficiently describes its nature,
is asking for an order upon the Commissioners of Inland Revenue to assess and
collect arrears of income said to be due by a number of people compendiously
described as “Fleet Street casuals”. These are workers in the printing industry
who, under a practice sanctioned apparently by their unions and their
employers, have for some years been engaged in a process of depriving the
Inland Revenue of tax due in respect of their casual earnings. This they appear
to have done by filling in false or imaginary names on the call slips presented on
collecting their pay. The sums involved were very considerable. The Inland
Revenue, having become aware of this, made an arrangement, which I explain
in more detail later, under which these workers are to register in respect of their
casual employment, so that in the future tax can be collected in the normal way.
Further, arrears of tax from 1977-8 are to be paid and current investigations
are to proceed, but investigations as to tax lost in earlier years are not to be
made. This arrangement, described inaccurately as an “amnesty”, the
Federation wishes to attack. It asserts that the Revenue acted unlawfully in not
pursuing the claim for the full amount of tax due. It claims that the Board
exceeded its powers in granting the ” amnesty”; alternatively that if it had power
to grant it, reasons should be given and that those given cannot be sustained;
that the Board took into account matters to which it was not entitled to have
regard; that the Board ought to act fairly as between taxpayers and has not done
so; and that the Board is under a duty to see that Income Tax is duly assessed,
charged, and collected.
The proceedings have been brought by the procedure now called “judicial
review”. There are two claims, the first for a declaration that the Board of
Inland Revenue “acted unlawfully” in granting an amnesty to the casual
workers; the second, for an order of mandamus to assess and collect income tax
from the casual workers according to the law. These two claims rest, for present
purposes, upon the same basis, since a declaration is merely an alternative kind
of relief which can only be given if, apart from convenience, the case would have
been one for mandamus.
In the Order which introduced the simplified remedies by way of judicial
review (RS.C. 0.53, dating from 1977), it is laid down (r.3(5)) that:
“The Court shall not grant leave unless it considers that the applicant
“has a sufficient interest in the matter to which the application relates”.
The issue which comes before us is presented as one related solely to the
question whether the Federation has the “sufficient interest” required.
In the Divisional Court, when the motion for judicial review came before it,
the point as to locus standi was treated as a preliminary point “Before we
embark on the case itself, said Lord Widgery C. J., “we have to decide whether
“the Federation has power to bring it at all”. After hearing argument, the court
decided that it had not. The matter went to the Court of Appeal, and again
argument was concentrated on the preliminary point, though it, and the
judgments, did range over the merits. The Court of Appeal by majority reversed
the Divisional Court and made a declaration that “the applicants have a
“sufficient interest to apply for Judicial Review”. On final appeal to this House,
the two sides concurred in stating that the only ground for decision was whether
the applicants have such sufficient interest
I think that it is unfortunate that this course has been taken. There may be
simple cases in which it can be seen at the earliest stage that the person applying
2
for judicial review has no interest at all, or no sufficient interest to support the
application: then it would be quite correct at the threshold to refuse him leave to
apply. The right to do so is an important safeguard against the courts being
flooded and public bodies harassed by irresponsible applications. But in other
cases this will not be so. In these it will be necessary to consider the powers or
the duties in law of those against whom the relief is asked, the position of the
applicant in relation to those powers or duties, and to the breach of those said to
have been committed. In other words, the question of sufficient interest can not,
in such cases, be considered in the abstract, or as an isolated point: it must be
taken together with the legal and factual context. The rule requires sufficient
interest in the matter to which the application relates. This, in the present case,
necessarily involves the whole question of the duties of the Inland Revenue and
the breaches or failure of those duties of which the respondents complain.
Before proceeding to consideration of these matters, something more needs
to be said about the threshold requirement of ” sufficient interest”. The courts in
exercising the power to grant prerogative writs, or since 1938 prerogative
orders, have always reserved the right to be satisfied that the applicant had
some genuine locus standi to appear before it. This they expressed in different
ways. Sometimes it was said, usually in relation to certiorari, that the applicant
must be a person aggrieved; or having a particular grievance (Ex parte
Greenbaum (1951) 55 Knight’s L.G.R. 129); usually in relation to mandamus,
that he must have a specific legal right (Reg. v. Guardians of Lewisham Union
[1897] 1 Q.B.498, Reg. v. Russell [1969] 1 Q.B. 342); sometimes that he must
have a sufficient interest (Reg. v. Cotham [1898] 1 Q.B. 802, 804 (mandamus),
Ex parte Stott [1916] 1 K.B. 7 (certiorari)). By 1977 when R.S.C. 0.53 was
introduced the courts, guided by Lord Parker C.J., in cases where mandamus
was sought, were moving away from the Lewis ham Union test of specific legal
right, to one of sufficient interest.
In Reg. v. Russell [1969] 1 Q.B. 342 Lord Parker had tentatively adhered to
the test of legal specific right but in Reg. v. Commissioners for Customs and
Excise: Ex parte Cook [1970] 1 W.L.R. 450, he had moved to sufficient
interest. Shortly afterward the new rule (0.53 r.3) was drafted with these words.
R.S.C. 0.53 was, it is well known, introduced to simplify the procedure of
applying for the relief formerly given by prerogative writ or order — so the old
technical rules no longer apply. So far as the substantive law is concerned, this
remained unchanged: the Administration of Justice (Miscellaneous Provisions)
Act 1938 preserved the jurisdiction existing before the Act, and the same
preservation is contemplated by legislation now pending. The Order,
furthermore, did not remove the requirement to show locus standi. On the
contrary, in r.3, it stated this in the form of a threshold requirement to be found
by the court. For all cases the test is expressed as one of sufficient interest in the
matter to which the application relates. As to this I would state two negative
propositions. First, it does not remove the whole — and vitally important —
question of locus standi into the realm of pure discretion. The matter is one for
decision, a mixed decision of fact and law, which the court must decide on legal
principles. Secondly, the fact that the same words are used to cover all the forms
of remedy allowed by the rule does not mean that the test is the same in all cases.
When Lord Parker C.J. said that in cases of mandamus the test may well be
stricter (sc. than in certiorari) — Reg. v. Russell (u.s.) and in Ex parte Cook
(u.s.) “on a very strict basis”, he was not stating a technical rule — which can
now be discarded — but a rule of common sense, reflecting the different
character of the relief asked for. It would seem obvious enough that the interest
of a person seeking to compel an authority to carry out a duty is different from
that of a person complaining that a judicial or administrative body has, to his
detriment, exceeded its powers. Whether one calls for a stricter rule than the
other may be a linguistic point they are certainly different and we should be
unwise in our enthusiasm for liberation from procedural fetters to discard
reasoned authorities which illustrate this. It is hardly necessary to add that
recognition of the value of guiding authorities does not mean that the process of
judicial review must stand still.
In the present case we are in the area of mandamus — an alleged failure to
perform a duty. It was submitted by the Lord Advocate that in such cases we
should be guided by the definition of the duty — in this case statutory — and
3
enquire whether expressly, or by implication, this definition indicates — or the
contrary — that the complaining applicant is within the scope or ambit of the
duty. I think that this is at least a good working rule though perhaps not an
exhaustive one.
The Commissioners of Inland Revenue are a statutory body. Their duties
are, relevantly, defined in the Inland Revenue Regulation Act 1890 and the
Taxes Management Act 1970. Section 1 of the Act of 1890 authorises the
appointment of Commissioners “for the collection and management of inland
“revenue” and confers on the Commissioners “all necessary powers for
“carrying into execution every Act of Parliament relating to inland revenue”.
By section 13 the Commissioners must “collect and cause to be collected every
“part of inland revenue and all money under their care and management and
“keep distinct accounts thereof.
The Act of 1970 provides (section 1) that “income tax… shall be under the
“care and management of the Commissioners”. This Act contains the very
wide powers of the Board and of Inspectors of Taxes to make assessments upon
persons designated by Parliament as liable to pay income tax. With regard to
casual employment, there is a procedure laid down by statutory instrument
(S.I. 1973 No. 334) by which Inspectors of Taxes may proceed by way of direct
assessment or in accordance with any special arrangements which the
Commissioners of Inland Revenue may make for the collection of the tax. As I
shall show later it was a “special arrangement” that the Commissioners set out
to make in the present case.
From this summary analysis it is clear that the Commissioners of Inland
Revenue are not immune from the process of judicial review. They are an
administrative body with statutory duties, which the courts, in principle, can
supervise. They have indeed done so — see The Queen v. Special
Commissioners [1888] 21 Q.B. 313 (mandamus) and cf. Special
Commissioners v. Linsleys (Established 1894) Ltd. [1958] A.C. 569, where it
was not doubted that a mandamus could be issued if the facts had been right. It
must follow from these cases and from principle that a taxpayer would not be
excluded from seeking judicial review if he could show that the Revenue had
either failed in its statutory duty toward him or had been guilty of some action
which was an abuse of their powers or outside their powers altogether. Such a
collateral attack — as contrasted with a direct appeal on law to the courts —
would no doubt be rare, but the possibility certainly exists.
The position of other taxpayers — other than the taxpayers whose
assessment is in question — and their right to challenge the Revenue’s
assessment or non-assessment of that taxpayer, must be judged according to
whether, consistently with the legislation, they can be considered as having
sufficient interest to complain of what has been done or omitted. I proceed
thereto to examine the Revenue’s duties in that light.
These duties are expressed in very general terms and it is necessary to take
account also of the framework of the income tax legislation. This establishes
that the Commissioners must assess each individual taxpayer in relation to his
circumstances. Such assessments and all information regarding taxpayers’
affairs are strictly confidential. There is no list or record of assessments which
can be inspected by other taxpayers. Nor is there any common fund of the
produce of income tax in which income taxpayers as a whole can be said to have
any interest. The produce of income tax, together with that of other inland
revenue taxes, is paid into the Consolidated Fund which is at the disposal of
Parliament for any purposes that Parliament thinks fit.
The position of taxpayers is therefore very different from that of ratepayers.
As explained in Arsenal Football Club Ltd. v. Ende [1979] A.C. 1, the amount
of rates assessed upon ratepayers is ascertainable by the public through the
valuation list The produce of rates goes into a common fund applicable for the
benefit of the ratepayers. Thus any ratepayer has an interest, direct and
sufficient, in the rates levied upon other ratepayers; for this reason, his right as a
“person aggrieved” to challenge assessments upon them has long been
recognised and is so now in the General Rate Act 1967, section 69. This right
was given effect to in Ende’s case (u.s.).
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The structure of the legislation relating to income tax, on the other hand,
makes clear that no corresponding right is intended to be conferred upon
taxpayers. Not only is there no express or implied provision in the legislation
upon which such a right could be claimed, but to allow it would be subversive of
the whole system, which involves that the Commissioners’ duties are to the
Crown, and that matters relating to income tax are between the Commissioners
and the taxpayer concerned. No other person is given any right to make
proposals about the tax payable by any individual: he cannot even enquire as to
such tax. The total confidentiality of assessments and of negotiations between
individuals and the Revenue is a vital element in the working of the system. As a
matter of general principle I would hold that one taxpayer has no sufficient
interest in asking the court to investigate the tax affairs of another taxpayer or to
complain that the latter has been under-assessed or over-assessed: indeed,
there is a strong public interest that he should not. And this principle applies
equally to groups of taxpayers: an aggregate of individuals each of whom has no
interest cannot of itself have an interest.
That a case can never arise in which the acts or abstentions of the Revenue
can be brought before the court I am certainly not prepared to assert, nor that, in
a case of sufficient gravity, the court might not be able to hold that another
taxpayer or other taxpayers could challenge them. Whether this situation has
been reached or not must depend upon an examination, upon evidence, of what
breach of duty or illegality is alleged. Upon this, and relating it to the position of
the complainant, the court has to make its decision. I find it necessary to state
the circumstances in some detail.
The evidence consists of affidavits from Mr. L.F. Payne, Vice-President of
the Federation, Sir William Pile, Chairman of the Board of Inland Revenue,
and Mr. J.A.P. Hoadley, Principal Inspector of Taxes, in charge of the Inland
Revenue Special Offices. These together present a picture of clarity. It is not
often that a court on summary proceedings has so much and so relevant
information.
Mr. Payne’s affidavit sets out very fairly the facts as known to him regarding
the employment of the “casuals” and the Revenue’s actions with regard to the
income tax they ought to have paid. He also gives a number of examples of what
he claims to be the very different attitude, viz. one of strictness and even
severity, taken by the Revenue as regards persons represented by the
Federation. I think that these examples while explaining the indignation of the
Federation and its members as regards the state of affairs in Fleet Street, cannot
be judged on their merits on the material we have. Even if there were not another
side to the taxpayers’ presentation (and the Revenue suggests there may be) it is
not suggested that, and is impossible to see how, any success in these
proceedings would in any tangible way profit, or affect, the persons concerned
or others like them.
On the other hand, as I suggested in Ende’s case, a sense of fairness as
between one taxpayer or group of taxpayers and another is an important
objective, so that a sense of unfairness may be the beginning of a recognisable
grievance. I say the beginning, because the Income Tax legislation contains a
large number of anomalies which are naturally not thought to be fair by those
disadvantaged.
In this context Mr. Payne also refers to the approach of the Revenue adopted
in relation to self-employed workers in the construction industry (commonly
known as “the lump”), who were found to be evading tax on a large scale. In this
case the Revenue persuaded Parliament to enact legislation of a stringent
character. But I think that this has no relevance for the present issue. Finally,
Mr. Payne agrees that the new arrangements made by the Inland Revenue may
be effective in securing that tax will be paid in the future on casual earnings. But
he complains of the “amnesty” granted as regards arrears before 1977.
Sir William Pile gives a general description of the scope and nature of the
duties of the Inland Revenue with regard to the assessment and collection of
taxes. He draws attention to the large number of potential taxpayers (about 25
million) the huge sums involved, and the limitations on the Board’s manpower.
His evidence is that it is impossible for the Board to collect all the tax that is due,
and that decisions have to be taken by way of “care and management” of the
5
taxes to collect as much as is practicable, by cost-effective methods. He denies
any discrimination as between self-employed and other taxpayers. Such
differences as exist are ascribable to difference of law and of fact The cases
cited by Mr. Payne are in his opinion contentious. As regard the “casuals”, the
Board approved the proposals made by Mr. Hoadley and considered that it had
good and sufficient justification for doing so. This was clearly a “management”
decision.
Mr. Hoadley explains the way in which the special offices came to
investigate the problem of casual workers in Fleet Street, and the difficulties of
discovering the facts. There is, and I think Mr. Payne agrees, no way in which
the names and addresses of the defaulting “casuals” could be obtained, unless
their unions were willing to reveal them. Estimating that about £1 million of tax
a year were being lost, he decided that action was needed to stop this loss for the
future. After reflection he considered that the best way to do so was by way of a
special arrangement In order to make such an arrangement effective, the
co-operation of the employers, the workers and the unions was essential. For
this purpose he had lengthy discussions in the summer of 1978 with the
employers, and the three unions involved, and as a result introduced a special
arrangement in March 1979. This provided a method which would ensure that
for the future tax would either be deducted at source or would be properly
assessed. As regards the past, Mr. Hoadley made it clear to the union
representative that, if the arrangement were generally accepted, then if a casual
worker registered with the Inspector before 6th April 1979 and co-operated
fully and promptly in settling his tax affairs (including the payment of any
outstanding tax) investigation into tax lost would not be carried out for years
before 1977-78, i.e. before 6th April 1977. Investigations into incorrect
returns would be unaffected. As I have indicated, to call this an “amnesty” is
liable to mislead.
Mr. Hoadley expressed the conviction that an attempt to collect the whole
amount due from hostile workers whose identity was unknown, for a period
more than two years in the past, would have been unlikely to produce any
substantial sums of money and would have delayed or even frustrated the new
arrangement. He denied that he made the arrangement under pressure from the
unions: he made his own decision and told them of it.
In the Court of Appeal a good deal was made of the possibility of industrial
action. But for this element, I think that the Master of the Rolls would have come to
the conclusion that the Federation had no sufficient interest in the affairs of the
“casuals”. But he was impressed with the possibility that the Revenue had
taken their decision because of threats of industrial action, and consequent
pressure by employers. After carefully examining the evidence, I reach the
conclusion that it does not support the argument. It was dealt with quite frankly
by Mr. Hoadley. He knew, of course, that the newspaper industry is vulnerable
to strikes. He said that the possibility of industrial action would not prevent him
from seeking a settlement. But he would not get one without co-operation from
the casuals and the unions, and if the latter did not co-operate nor would the
employers. I think that all this was part of the process of obtaining the
arrangement, and that it cannot be said that these very real considerations were
outside what a person seeking, in the best interest of the Revenue, to obtain an
agreement could properly take into account.
Finally, Mr. Hoadley dealt very fully and adequately with all Mr. Payne’s
other points. His affidavit is very full and candid and I have only summarised
the main points.
On the evidence as a whole, I fail to see how any court considering it as such
and not confining its attention to an abstract question of locus standi could
avoid reaching the conclusion that the Inland Revenue, through Mr. Hoadley,
were acting in this matter genuinely in the care and management of the taxes,
under the powers entrusted to them. This has no resemblance to any kind of
case where the court ought, at the instance of a taxpayer, to intervene. To do so
would involve permitting a taxpayer or a group of taxpayers to call in question
the exercise of management powers and involve the court itself in a management
exercise. Judicial review under any of its headings does not extend into this
area. Finally, if as I think, the case against the Revenue does not, on the
6
evidence, leave the ground, no court, in my opinion, would consider ordering
discovery against the Revenue in the hope of eliciting some impropriety.
Looking at the matter as a whole, I am of opinion that the Divisional Court,
while justified on the ex parte application in granting leave, ought, having regard
to the nature of “the matter” raised, to have held that the Federation had shown
no sufficient interest in that matter to justify its application for relief. I would
therefore allow the appeal and order that the originating motion be dismissed.
Lord Diplock
my lords,
This appeal provides the House with its first occasion to consider what
changes, if any, to public law in England have been made by the new Order 53
of the Rules of the Supreme Court which came into effect on 11th January
1978, and provides for applications for judicial review of the legality of action
or inaction by persons or bodies exercising governmental powers.
It is, in my view, very much to be regretted that a case of such importance to
the development of English public law under this new procedure should have
come before this House in the form that it does as a result of what my noble and
learned friend, Lord Wilberforce, has described as the unfortunate course that
was taken in the courts below when, leave to apply for judicial review having
been previously granted ex parte, the application itself came on for hearing.
This has had the result of deflecting the Divisional Court and the Court of
Appeal from giving consideration to the questions (1) what was the public duty
of the Board of Inland Revenue of which it was alleged to be in breach, and (2),
what was the nature of the breaches that were relied upon by the Federation.
Because of this, the judgment of the Court of Appeal against which appeal to
your Lordships’ House is brought takes the form of an interlocutory judgment
declaring that the Federation “have a sufficient interest to apply for judicial
“review herein”.
As my noble and learned friend has pointed out, these two omitted questions
need to be answered in the instant case before it is possible to say whether the
Federation have “a sufficient interest in the matter to which the application
“relates”, since, until they are answered, that matter cannot be identified. This
is likely also to be the case in most applications for judicial review that are not
on the face of them frivolous or vexatious. Your Lordships have accordingly
heard full argument on both these questions.
As respects the statutory powers and duties of the Board of Inland Revenue,
these are described and dealt with in several of your Lordships’ speeches. It
would be wearisome if I were to repeat what already has been, and later will be,
better said by others. All that I need say here is that the Board are charged by
statute with the care, management and collection on behalf of the Crown of
income tax, corporation tax and capital gains tax. In the exercise of these
functions the Board have a wide managerial discretion as to the best means of
obtaining for the national exchequer from the taxes committed to their charge,
the highest net return that is practicable having regard to the staff available to
them and the cost of collection. The Board and the inspectors and collectors
who act under their directions are under a statutory duty of confidentiality with
respect to information about individual taxpayers’ affairs that has been
obtained in the course of their duties in making assessments and collecting the
taxes; and this imposes a limitation on their managerial discretion. I do not
doubt, however, and I do not understand any of your Lordships to doubt, that if
it were established that the Board were proposing to exercise or to refrain from
exercising its powers not for reasons of “good management” but for some
extraneous or ulterior reason, that action or inaction of the Board would be
ultra vires and would be a proper matter for judicial review if it were brought to
the attention of the court by an applicant with “a sufficient interest” in having
the Board compelled to observe the law.
As respects what were alleged to be breaches of its statutory duty by the
Board on which the Federation relied, the evidence as to the way in which the
Board and its Inspector in charge of the negotiations dealt with the problem of
7
the Fleet Street casuals and as to the reasons why they acted as they did, is set
out in all necessary detail in Lord Wilberforce’s speech. All this evidence was
before the Divisional Court and the Court of Appeal had they chosen to look at
it. It is enough for me to say that I agree with my noble and learned friend that no
court considering this evidence could avoid reaching the conclusion that the
Board and its Inspector were acting solely for “good management” reasons and
in the lawful exercise of the discretion which the statutes confer on them.
For my part, I should prefer to allow the appeal and dismiss the Federation’s
application under Order 53, not upon the specific ground of no sufficient
interest but upon the more general ground that it has not been shown that in the
matter of which complaint was made, the treatment of the tax-liabilities of the
Fleet Street casuals, the Board did anything that was ultra vires or unlawful.
They acted in the bona fide exercise of the wide managerial discretion
conferred on them by statute. Since judicial review is available only as a remedy
for conduct of a public officer or authority which is ultra vires or unlawful, but
not for acts done lawfully in the exercise of an administrative discretion which
are complained of only as being unfair or unwise, there is a sense in which it may
be said that the Federation had not a sufficient interest in the matter to which
their application related; but this is not a helpful statement; it would be equally
true of anyone, including the Attorney-General, who sought to complain.
It would be very much to be regretted if, in consequence of the unfortunate
form in which the instant appeal came before this House, anything that is said
by your Lordships today were to be understood as suggesting that the new
Order 53 rule 3(5) has the effect of reviving any of those technical rules of locus
standi to obtain the various forms of prerogative writs that were applied by the
judges up to and during the first half of the present century, but which have been
so greatly liberalised by judicial decision over the last thirty years. It is for this
reason that I venture to state how, in my view, Order 53 would have applied to
the Federation’s application if, instead of their locus standi being considered in
isolation, the proper course had been followed at the hearing of the application
in the Divisional Court.
My Lords, Order 5 3 was made by the Rules Committee under the powers
conferred upon them by section 99 of the Judicature Act 1925 and section 10 of
the Administration of Justice (Miscellaneous Provisions) Act 1938. Rules of
court made under these sections are concerned with procedure and practice
only; they cannot alter substantive law, nor can they extend the jurisdiction of
the High Court. But in the field of public law where the court has a discretion
whether or not to make an order preventing conduct by a public officer or
authority that has been shown to be ultra vires or unlawful, the question of what
qualifications an applicant must show before the court will entertain his
application for a particular kind of order against a particular class of public
officer or authority seems to me to be one of practice rather than of jurisdiction.
It has been consistently so treated by the courts over the past thirty years.
Before the new Order 53 was substituted for its predecessor, the private
citizen who sought redress against a person or authority for acting unlawfully or
ultra vires in the purported exercise of statutory powers, had to choose from a
number of different procedures that which was the most appropriate to furnish
him the redress that he sought The major differences in procedure including
locus standi to apply for the relief sought, were between the remedies by way of
declaration or injunction obtainable by a civil action brought to enforce public
law and the remedies by way of the prerogative orders of mandamus,
prohibition or certiorari which lay in public law alone; but even between the
three public law remedies there were minor procedural differences, and the
locus standi to apply for them was not quite the same for each, although the
divergencies were in process of diminishing.
Your Lordships can take judicial notice of the fact that the main purpose of
the new Order 53 was to sweep away these procedural differences including, in
particular, differences as to locus standi; to substitute for them a single
simplified procedure for obtaining all forms of relief, and to leave to the court a
wide discretion as to what interlocutory directions, including orders for
discovery, were appropriate to the particular case.
In the instant case, in the Divisional Court and Court of Appeal alike, the
argument for the Board was put upon the footing that notwithstanding this
8
unification of procedure for obtaining the various remedies available in public
law, including those which had been available in private law only, the new
Order 5 3 had left unchanged the basis on which an applicant was recognised as
having locus standi to apply for each individual form of relief sought In the
instant case these were: a declaration and an order of mandamus.
As respects the claim for a declaration considerable reliance was placed
upon the recent decision of this House in Gouriet v. Union of Post Office
Workers [1978] AC 435, which held that a private citizen, except as relator in
an action brought by the Attorney-General, has no locus standi in private law
as plaintiff in a civil action to obtain either an injunction to restrain another
private citizen (in casu a trade union) from committing a public wrong by
breaking the criminal law, or a declaration that his conduct is unlawful, unless
the plaintiff can show that some legal or equitable right of his own has been
infringed or that he will sustain some special damage over and above that
suffered by the general public. This decision is, in my view, irrelevant to any
question that your Lordships have to decide today. The defendant trade union
in deciding to instruct its members to take unlawful industrial action was not
exercising any governmental powers; it was acting as a private citizen and could
only be sued as such in a civil action under private law. It was not amenable to
any remedy in public law. Lord Wilberforce and I were at pains to draw this
distinction.
In contrast to this, judicial review is a remedy that lies exclusively in public
law. In my view the language of rule 1(2) and rule (3) of the new Order 5 3 shows
an intention that upon an application for judicial review the court should have
jurisdiction to grant a declaration or an injunction as an alternative to making
one of the prerogative orders, whenever in its discretion it thinks that it is just
and convenient to do so; and that this jurisdiction should be exerciseable in any
case in which the applicant would previously have had locus standi to apply for
any of the prerogative orders. The matters specified in paragraphs (a) and (b) of
rule 1(2) as matters to which the court must have regard, make this plain. So if,
before the new Order 53 came into force, the court would have had jurisdiction
to grant to the applicant any of the prerogative orders it may now grant him a
declaration or injunction instead, notwithstanding that the applicant would
have no locus standi to claim the declaration or injunction under private law in a
civil action against the respondent to the application, because he could not show
that any legal right of his own was threatened or infringed.
So I turn first to consider what constituted locus standi to apply for one or
other of the prerogative orders immediately before the new Order 53 came into
force.
In the earlier cases a more restrictive rule for locus standi was applied to
applications for the writ of mandamus than for writs of prohibition or certiorari;
and since mandamus was the prerogative order sought by the Federation in the
instant case, your Lordships have been referred to many of them; reliance being
placed in particular upon the brief extempore judgment of Wright J. delivered at
the end of the last century in Reg. v. Guardians of Lemsham Union [1897]
1 Q.B. 498. He there said that an applicant for a mandamus: “must first of all
“show that he has a legal specific right to ask for the interference of the court”.
The law has not stood still since 1897. By 1977 this was no longer correct, and I
have no hesitation in saying that it is inconceivable that mandamus would have
been refused in the circumstances of that case if it had come before a Divisional
Court at any time during the last twenty years.
The rules as to “standing” for the purpose of applying for prerogative orders,
like most of English public law, are not to be found in any statute. They were
made by judges, by judges they can be changed; and so they have been over the
years to meet the need to preserve the integrity of the rule of law despite changes
in the social structure, methods of government and the extent to which the
activities of private citizens are controlled by governmental authorities, that
have been taking place continuously, sometimes slowly, sometimes swiftly,
since the rules were originally propounded. Those changes have been
particularly rapid since World War II. Any judicial statements on matters of
public law if made before 1950 are likely to be a misleading guide to what the
law is today.
9
In 1951, the decision of the Divisional Court in Reg. v. Northumberland
Compensation Tribunal [1951] 1 Q.B. 711 resurrected error of law upon the
face of the award record as a ground for granting certiorari. Parliament by the
Tribunals and Inquiries Act 1958 followed this up by requiring reasons to be
given for many administrative decisions that had previously been cloaked in
silence; and the years that followed between then and 1977 witnessed a
dramatic liberalisation of access to the courts for the purpose of obtaining
prerogative orders against persons and authorities exercising governmental
powers. This involved a virtual abandonment of the former restrictive rules as
to the locus standi of persons seeking such orders. The process of liberalisation
of access to the courts and the progressive discarding of technical limitations
upon locus standi is too well known to call for detailed citation of the cases by
which it may be demonstrated. They are referred to and discussed in the fourth
edition of Professor H.W.R. Wade’s “Administrative Law”, (published in
1977) at pages 543 to 546 (prohibition and certiorari) and 610 to 612
(mandamus). The author points out there that although lip-service continued to
be paid to a difference in standing required to entitle an applicant to mandamus
on the one hand and prohibition or certiorari on the other, in practice the courts
found some way of treating the locus standi for all three remedies as being the
same. A striking example of this is to be found in Reg. v. Hereford Corporation
Ex parte Harrower [1970] 1 WLR 1424, where the applicants were treated as
having locus standi in their capacity as ratepayers though their real interest in
the matter was as electrical contractors only. For my part I need only refer to
Reg. v. Greater London Council Ex parte Blackburn [1976] 1 WLR 550. In
that case Mr. Blackburn who lived in London with his wife who was a ratepayer,
applied successfully for an order of prohibition against the council to stop them
acting in breach of their statutory duty to prevent the exhibition of pornographic
Films within their administrative area. Mrs. Blackburn was also a party to the
application. Lord Denning M.R. and Stephenson L.J. were of opinion that both
Mr. and Mrs. Blackburn had locus standi to make the application: Mr.
Blackburn because he lived within the administrative area of the council and
had children who might be harmed by seeing pornographic films and Mrs.
Blackburn not only as a parent but also on the additional ground that she was a
ratepayer. Bridge L.J. relied only on Mrs. Blackburn’s status as a ratepayer, a
class of persons to whom for historical reasons the court of King’s Bench
afforded generous access to control ultra vires activities of the public bodies to
whose expenses they contributed. But now that local government franchise is
not limited to ratepayers, this distinction between the two applicants strikes me
as carrying technicality to the limits of absurdity having regard to the subject-
matter of the application in the Blackburn case. I agree in substance with what
the Master of the Rolls there said, though in language more eloquent than it
would be my normal style to use:
“I regard it as a matter of high constitutional principle that if there is
“good ground for supposing that a government department or a public
“authority is transgressing the law, or is about to transgress it, in a way
“which offends or injures thousands of Her Majesty’s subjects, then any
“one of those offended or injured can draw it to the attention of the courts
“of law and seek to have the law enforced, and the courts in their
“discretion can grant whatever remedy is appropriate”.
(The italics in this quotation are my own).
The reference here is to flagrant and serious breaches of the law by persons
and authorities exercising governmental functions which are continuing
unchecked. To revert to technical restrictions on locus standi to prevent this
that were current thirty years ago or more would be to reverse that progress
towards a comprehensive system of administrative law that I regard as having
been the greatest achievement of the English courts in my judicial lifetime.
The reliance by Bridge L.J. in Reg. v. Greater London Council Ex parte
Blackburn upon Mrs. Blackburn’s status as a ratepayer to give her locus standi
reflects a special relationship between ratepayers and the rate-levying authority
and between one rate-payer and another, which is of ancient origin and
antedates by centuries the first imposition of taxes upon income. This led the
Board in the instant case to seek to rely upon the decision of this House in
Arsenal Football Club Ltd. v. Ende [1979] A.C. 1 as authority for a
proposition of law that a taxpayer lacked a sufficient interest in what the Board
10
did in dealing with the tax affairs of other taxpayers to clothe the court with
jurisdiction to entertain his application for an order of mandamus, however
flagrantly the Board, in its dealing with those other taxpayers, had flouted the
law So, it was contended, no question of discretion could arise. The Arsenal
Stadium case had been decided before the new Order 53 had been made; but, in
any event, it was not concerned with an application for a prerogative order, it
turned on whether a ratepayer who complained that the value for the
hereditament of another ratepayer published in the valuation list was too low,
was a “person aggrieved” by that low valuation within the meaning of section
69 of the General Rating Act 1967, notwithstanding that, since the raising of
the valuation of the hereditament could have no effect upon the amount of rates
payable by the objecting ratepayer, no financial interest of his own was affected.
The question before this House was one of statutory construction only. It was
held that the objecting ratepayer was a “person aggrieved”, not only in his
capacity as a ratepayer in the same London Borough as that in which the
hereditament that was the subject of his complaint was situated but also as a
ratepayer of another London Borough within the precepting area of the G.L.C.
The case is thus illustrative of the liberal attitude of the courts in granting access
to legal remedies for those complaining of failure of public officers to perform
their duties. He was held, however, not to be a person aggrieved in his capacity
as a taxpayer despite the fact that any shortfall in the rate yield due to the
undervaluation of the hereditament would be made up from central funds to
which all taxpayers in Great Britain contribute. A line, it was said, has to be
drawn somewhere, and his interest as a taxpayer was too remote to qualify him
as a person aggrieved by a single entry in the valuation list for rating purposes of
a London Borough.
My Lords, the expression “person aggrieved” is of common occurrence in
statutes and, in its various statutory contexts, has been the subject of
considerable judicial exegesis. In the past, however, it had also sometimes been
used by judges to describe those persons who had locus standi to apply for the
former prerogative writs or, since 1938, prerogative orders. It was on this
somewhat frail ground that it was argued that the distinction drawn in the
Arsenal Stadium case between Mr. Ende’s grievance as a ratepayer and his
grievance as a taxpayer was relevant to the question whether the Federation as
representing taxpayers was entitled to locus standi in the instant case. However
this may have been before the new Order 53 was made, the draftsman of that
order avoided using the expression “a person aggrieved”, although it lay ready
to his hand. He chose instead to get away from any formula that might be
thought to have acquired, through judicial exposition, a particular meaning as a
term of legal art. The expression that he used in rule 3(5) had cropped up
sporadically in judgments relating to prerogative writs and orders and consisted
of ordinary English words which, on the face of them, leave to the court an
unfettered discretion to decide what in its own good judgment it considers to be
“a sufficient interest” on the part of an applicant in the particular circumstances
of the case before it. For my part I would not strain to give them any narrower
meaning.
The procedure under the new Order 53 involves two stages: (1) the
application for leave to apply for judicial review, and (2) if leave is granted, the
hearing of the application itself. The former, or “threshold”, stage is regulated
by rule 3. The application for leave to apply for judicial review is made initially
ex pane, but may be adjourned for the persons or bodies against whom relief is
sought to be represented. This did not happen in the instant case. Rule 3(5)
specifically requires the court to consider at this stage whether “it considers that
“the applicant has a sufficient interest in the matter to which the application
“relates.” So this is a “threshold” question in the sense that the court must
direct its mind to it and form a prima facie view about it upon the material that is
available at the first stage. The prima facie view so formed, if favourable to the
applicant, may alter on further consideration in the light of further evidence that
may be before the court at the second stage, the hearing of the application for
judicial review itself.
The need for leave to start proceedings for remedies in public law is not new.
It applied previously to applications for prerogative orders, though not to civil
actions for injunctions or declarations. Its purpose is to prevent the time of the
court being wasted by busybodies with misguided or trivial complaints of
11
administrative error, and to remove the uncertainty in which public officers and
authorities might be left as to whether they could safely proceed with
administrative action while proceedings for judicial review of it were actually
pending even though misconceived.
My Lords, I understand that all your Lordships are agreed that upon the
material that was before the Divisional Court upon the ex parte application by
the Federation for leave to apply for judicial review of the so-called “amnesty”
extended to the Fleet Street casuals, the court was justified in exercising its
discretion in favour of granting the leave sought. The only evidence that was
before the court was the affidavit of Mr. Payne, the contents of which have been
summarised by my noble and learned friend Lord Wilberforce. It made out a
prima facie case, albeit a somewhat flimsy one, that the Revenue had
differentiated between three classes of defaulting taxpayers, (1) the Fleet Street
casuals, all of whom were members of powerful trade unions, (2) owners of
small businesses, who were not members of trade unions and on whose behalf
the Federation purported to be acting, and (3) perhaps more significantly, self-
employed workers in the construction industry popularly referred to as “the
“lump” to whom powerful trade unions were bitterly opposed. In the absence of
any other explanation, the leniency with which tax defaulters in the first class
had been treated as contrasted with the severity with which those in the two
latter classes were pursued, gave rise, it was suggested by the Federation, to
reasonable suspicion that the Revenue had granted the amnesty not for any
reasons of good management, but simply in response to trade union pressure.
The complaint made by the Federation was not of preferential treatment of
individual taxpayers but of all taxpayers falling within a particular class
comprising 4,000 to 5,000 members whose unpaid taxes, recovery of which up
to April 1977 was to be abandoned, were of the order of £1,000,000 a year.
Consideration of the Federation’s complaint would not involve any departure
from the Board’s statutory duty to preserve the confidentiality of information
obtained by its inspectors and collectors about individual taxpayers’ affairs,
since ex hypothesi the members of this class of taxpayers had made no returns
and had not provided any information about their affairs.
My Lords, at the threshold stage, for the Federation to make out a prima
facie case of reasonable suspicion that the Board in showing a discriminatory
leniency to a substantial class of taxpayers had done so for ulterior reasons
extraneous to good management, and thereby deprived the national exchequer
of considerable sums of money, constituted what was in my view reason enough
for the Divisional Court to consider that the Federation or, for that matter, any
taxpayer, had a sufficient interest to apply to have the question whether the
Board was acting ultra vires reviewed by the court. The whole purpose of
requiring that leave should first be obtained to make the application for judicial
review would be defeated if the court were to go into the matter in any depth at
that stage. If, on a quick perusal of the material then available, the court thinks
that it discloses what might on further consideration turn out to be an arguable
case in favour of granting to the applicant the relief claimed, it ought, in the
exercise of a judicial discretion, to give him leave to apply for that relief. The
discretion that the court is exercising at this stage is not the same as that which it
is called upon to exercise when all the evidence is in and the matter has been
fully argued at the hearing of the application.
The analysis to which, on the invitation of the Lord Advocate, the relevant
legislation has been subjected by some of your Lordships, and particularly the
requirement of confidentiality which would be broken if one taxpayer could
complain that another taxpayer was being treated by the Revenue more
favourably than himself, means that occasions will be very rare on which an
individual taxpayer (or pressure group of taxpayers) will be able to show a
sufficient interest to justify an application for judicial review of the way in which
the Revenue has dealt with the tax affairs of any taxpayer other than the
applicant himself.
Rare though they may be, however, if, in the instant case, what at the
threshold stage was suspicion only had been proved at the hearing of the
application for judicial review to have been true in fact (instead of being utterly
destroyed), I would have held that this was a matter in which the Federation had
a sufficient interest in obtaining an appropriate order, whether by way of
12
declaration or mandamus, to require performance by the Board of statutory
duties which for reasons shown to be ultra vires it was failing to perform.
It would, in my view, be a grave lacuna in our system of public law if a
pressure group, like the Federation, or even a single public-spirited taxpayer,
were prevented by outdated technical rules of locus standi from bringing the
matter to the attention of the court to vindicate the rule of law and get the
unlawful conduct stopped. The Attorney-General, although he occasionally
applies for prerogative orders against public authorities that do not form part of
central government, in practice never does so against government departments.
It is not, in my view, a sufficient answer to say that judicial review of the actions
of officers or departments of central government is unnecessary because they
are accountable to Parliament for the way in which they carry out their
functions. They are accountable to Parliament for what they do so far as regards
efficiency and policy, and of that Parliament is the only judge; they are
responsible to a court of justice for the lawfulness of what they do, and of that
the court is the only judge.
I would allow this appeal upon the ground upon which, in my view, the
Divisional Court should have dismissed it when the application came to be
heard, instead of singling out the lack of a sufficient interest on the part of the
Federation, viz. that the Federation completely failed to show any conduct by
the Board that was ultra vires or unlawful.
Lord Fraser of Tullybelton
my lords.
I agree with all my noble and learned friends that this appeal should be
allowed. I agree with the reasoning of Lord Wilberforce and Lord Roskill but I
wish to explain my reasons in my own words.
The application by the respondents in the appeal for judicial review under
R.S.C. Order 53 was refused by the Divisional Court on the ground that the
applicants did not have a “sufficient interest” in the matter to which the
application related, as required by rule 3 of that order. The decision of the
Divisional Court was reversed by the Court of Appeal, by majority. Some of my
noble and learned friends who heard the appeal consider that the appeal should
be allowed and the application refused on the wider ground that it has no
prospect of success on the merits. I agree that it does not, because the relief
sought is a judicial review in the form of a declaration that the appellants “acted
“unlawfully” and an order of mandamus that they assess and collect income tax
“according to the law”, but for the reasons explained by my noble and learned
friend Lord Wilberforce, it is clear that the appellants did not act unlawfully. So
the application cannot succeed on its merits.
But the question whether the respondents have a sufficient interest to make
the application at all is a separate, and logically prior, question which has to be
answered affirmatively before any question on the merits arises. Refusal of the
application on its merits therefore implies that the prior question has been
answered affirmatively. I recognise that in some cases, perhaps in many, it may
be impracticable to decide whether an applicant has a sufficient interest or not,
without having evidence from both parties as to the matter to which the
application relates, and that, in such cases, the court before whom the matter
comes in the first instance cannot refuse leave to the applicant at the ex parts
stage, under rule 3(5). The court which grants leave at that stage will do so on
the footing that it makes a provisional finding of sufficient interest, subject to
revisal later on, and it is therefore not necessarily to be criticised merely
because the final decision is that the applicant did not have sufficient interest.
But where, after seeing the evidence of both parties, the proper conclusion is
that the applicant did not have a sufficient interest to make the application, the
decision ought to be made on that ground. The present appeal is, in my view,
such a case and I would therefore dismiss the appeal on that ground. When it is
also shown, as in this case, that the application would fail on its merits, it is
desirable for that to be stated by the court which first considers the matter in
order to avoid unnecessary appeals on the preliminary point.
13
The rules of court give no guidance as to what is a sufficient interest for this
purpose. I respectfully accept from my noble and learned friends who are so
much more familiar than I am with the history of the prerogative orders that
little assistance as to the sufficiency of the interest can be derived from the older
cases. But while the standard of sufficiency has been relaxed in recent years, the
need to have an interest has remained and the fact that rule 3 of Order 53
requires a sufficient interest undoubtedly shows that not every applicant is
entitled to judicial review as of right.
The new Order 53, introduced in 1977, no doubt had the effect of removing
technical and procedural differences between the prerogative orders, and of
introducing a remedy by way of declaration or injunction in suitable cases, but I
do not think it can have had the effect of throwing over all the older law and of
leaving the grant of judicial review in the uncontrolled discretion of the court.
On what principle, then, is the sufficiency of interest to be judged? All are
agreed that a direct financial or legal interest is not now required, and that the
requirement of a legal specific interest laid down in Regina v. Lewisham
Guardians [1897] 1 Q.B. 488 is no longer applicable. There is also general
agreement that a mere busybody does not have a sufficient interest. The
difficulty is, in between those extremes, to distinguish between the desire of the
busybody to interfere in other people’s affairs and the interest of the person
affected by or having a reasonable concern with the matter to which the
application relates. In the present case that matter is an alleged failure by the
appellants to perform the duty imposed upon them by statute.
The correct approach in such a case is, in my opinion, to look at the statute
under which the duty arises, and to see whether it gives any express or implied
right to persons in the position of the applicant to complain of the alleged
unlawful act or omission. On that approach it is easy to see that a ratepayer
would have a sufficient interest to complain of unlawfulness by the authorities
responsible for collecting the rates. Even if the General Rate Act 1967 had not
expressly given him a right to propose alteration in the Valuation List if he is
aggrieved by any entry therein, he would have an interest in the accuracy of the
list which is the basis for allocating the total burden of rates between himself and
other ratepayers in the area. The list is public and is open for inspection by any
person. The position of the taxpayer is entirely different. The figures on which
other taxpayers have been assessed are not normally within his knowledge and
the Commissioners of Inland Revenue and their officials are obliged to keep
these matters strictly confidential, see Inland Revenue Regulation Act 1890
section 1(1) and section 39 and the Taxes Management Act 1970 section 1,
section 6 and Schedule 1. The distinction between a ratepayer and a taxpayer
that was drawn in Arsenal Football Club Ltd. v. Ende [1979] A.C. 1 for the
purposes of defining a person aggrieved under the General Rate Act 1967 is
also relevant to the present matter.
The respondents are a body with some 50,000 members, but their counsel
conceded, rightly in my opinion, that if they had a sufficient interest to obtain
judicial review, then any individual taxpayer, or at least any payer of income
tax, must also have such an interest. I can see no justification for treating payers
of income tax as having any separate interest in the matter now complained of
from that of persons who pay other taxes. All taxpayers contribute to the
general fund of revenue and the sense of grievance which the respondents claim
to feel because of the difference between the appellants’ treatment of the Fleet
Street casuals and their treatment of private traders might be felt just as strongly
by any honest taxpayer who pays the full amount of taxes of any kind to which
he is properly liable. But if the class of persons with a sufficient interest is to
include all taxpayers it must include practically every individual in the country
who has his own income, because there must be few individuals, however frugal
their requirements, who do not pay some indirect taxes including VAT. It
would, I think, be extravagant to suggest that every taxpayer who believes that
the Inland Revenue or the Commissioners of Customs and Excise are giving an
unlawful preference to another taxpayer, and who feels aggrieved thereby, has a
sufficient interest to obtain judicial review under Order 53. It may be that, if he
was relying upon some exceptionally grave or widespread illegality, he could
succeed in establishing a sufficient interest but such cases would be very rare
indeed, and this is not one of them.
14
For these reasons I would allow the appeal on the ground that the
respondents have no sufficient interest in the matters complained of.
Lord Scarman
MY LORDS,
The National Federation of Self-Employed and Small Businesses Ltd. are
applicants for judicial review. The Federation seek a declaration and an order
of mandamus. They are asking the court to declare illegal a policy decision by
the Revenue not to collect back tax from the casual printers of Fleet Street and
to order the Revenue to collect the tax. The decision was taken by the Revenue
pursuant to a special arrangement under which the Revenue agreed not to seek
to collect the tax of past years if the casuals would comply with arrangements
facilitating the collection of tax for future years. The details of the arrangement
are fully set out in the affidavit evidence. The Federation allege that the special
arrangement — “amnesty” is what they understandably but inaccurately call
it – – when contrasted with the Revenue’s relentless pursuit of Federation
members who are suspected of not paying their taxes is a breach of the
Revenue’s duty to treat taxpayers fairly, that the duty is owed to the general
body of taxpayers, and that the Federation and its members have a genuine
grievance which entitle them to seek the assistance of the court. The Revenue
denies the existence of any such duty owed to the Federation, its members, or
the general body of taxpayers, though it acknowledges the importance, as a
matter of policy, of treating taxpayers fairly. The Revenue denies, therefore,
that the Federation (or its members) have a sufficient interest in the matter to
entitle them to relief by way of judicial review. Put shortly, if there is no legal
duty, there can be no interest which a court can protect.
The application for judicial review was introduced by rule of court in 1977.
The new R.S.C. Order 53 is a procedural reform of great importance in the field
of public law, but it does not — indeed, cannot — either extend or diminish the
substantive law. Its function is limited to ensuring “ubi jus, ibi remedium”.
The new procedure is more flexible than that which it supersedes. An
applicant for relief will no longer be defeated merely because he has chosen to
apply for the wrong remedy. Not only has the court a complete discretion to
select and grant the appropriate remedy: but it now may grant remedies which
were not previously available. Rule 1(2) enables the court to grant a declaration
or injunction instead of, or in addition to, a prerogative order where to do so
would be just and convenient. This is a procedural innovation of great
consequence: but it neither extends nor diminishes the substantive law. For the
two remedies (borrowed from the private law) are put in harness with the
prerogative remedies. They may be granted only in circumstances in which one
or other of the prerogative orders can issue. I so interpret Order 53, r.l(2)
because to do otherwise would be to condemn the rule as ultra vires.
The appeal is said by both parties to turn on the meaning to be attributed to
0.53 rule 3(5), which has been described as the heart of the Order. It is in these
terms:
“(5) The Court shall not grant leave unless it considers that the
“applicant has a sufficient interest in the matter to which the application
“relates.”
There is, my Lords, no harm in so describing the issue, so long as it is
remembered that the right to apply for a prerogative order is a matter of law, not
to be modified or abridged by rule of court. The right has always been, and
remains to-day, available only at the discretion of the High Court which has to
be exercised upon the facts of the particular case and according to principles
developed by the judges. The case law, as it has developed and continues to
develop in the hands of the judges, determines the nature of the interest an
applicant must show to obtain leave to apply. The rule, however, presents no
problems of construction. Its terms are wide enough to reflect the modern law
without distorting or abridging the discretion of the judges: and it draws
attention to a feature of the law, which has been overlooked in the present case.
The sufficiency of the applicant’s interest has to be judged in relation to the
15
subject-matter of his application. This relationship has always been of
importance in the law. It is well illustrated by the history of the development of
the prerogative writs, notably the difference of approach to mandamus and
certiorari and it remains a factor of importance in the exercise of the discretion
to-day.
I, therefore, accept that one may properly describe the question for the
House’s decision as being whether the Federation has shown that it has a
sufficient interest in the matter to which its application relates to apply for a
declaration and an order of mandamus directed to requiring the Commissioners
of Inland Revenue to fulfil their public duty. The question is far from easy to
answer, raising some complicated issues as to the rights of the private citizen to
invoke the aid of the courts in compelling the performance of public duty or in
righting public wrongs:— rights whose scope and effect derive not from R.S.C.
Order 53 but from the common law developed by the judges.
The Federation obtained leave ex parte to apply for judicial review. They
then sought an order for discovery of documents from the Master; but no order
was made pending the hearing, inter partes, of a preliminary issue on the locus
standi point. The Divisional Court decided the preliminary issue against the
Federation, basing itself on dicta to be found in the speeches in Arsenal
Football Club Ltd. v. Ende [1979] A.C. 1. The Court of Appeal, by a majority,
allowed the Federation’s appeal, holding, as the Master of the Rolls put it, that
the Federation and its members “are not mere busybodies” but “have a genuine
“grievance” [1980] 2 All E.R. 378 at p. 392. Ackner L.J., after remarking that
it had been assumed (by counsel’s concession limited to the argument on the
preliminary issue) that the Board acted unlawfully, held that “the body of
“taxpayers represented by the Federation can reasonably assert a genuine
“grievance,” supra, p. 399.
As others of your Lordships have already commented, the decision to take
locus standi as a preliminary issue was a mistake and has led to unfortunate
results. The matter to which the application relates, namely, the legality of the
policy decision taken by the Revenue to refrain from collecting tax from the
Fleet Street casuals, was never considered by the Divisional Court and was
dealt with by concession in the Court of Appeal. Yet there were available at
both hearings very full affidavits from which the circumstances in which the
policy decision, which is challenged, was taken, and the Revenue’s explanation,
clearly emerge.
In Your Lordships’ House the Lord Advocate, who now appears for the
appellants, the Commissioners of Inland Revenue, has withdrawn the
concession. He was right to do so. He has put at the forefront of his argument a
reasoned analysis of the statutory duties of the Revenue, and has invited the
House to hold that the statutory code neither recognises nor imposes upon the
Revenue a duty such as the Federation alleges to the general body, or any group
of taxpayers.
Before I consider this submission, it is necessary to deal with a subsidiary
point taken by the Lord Advocate. He submitted that, notwithstanding the
language of Order 53 rule 1(2) the court has no jurisdiction to grant to a private
citizen a declaration save in respect of a private right or wrong: and he relied on
the House’s decision in Gouriet v. Union of Post Office Workers [1978] A.C.
435. Declaration is, of course, a remedy developed by the judges in the field of
private law. Gouriet’s case is authority for the proposition that a citizen may not
issue a writ claiming a declaration or other relief against another for the redress
of a public wrong unless he can persuade the Attorney-General, on his
“relation”, to bring the action. The case has nothing to do with the prerogative
jurisdiction of the High Court; and it was decided before the introduction of the
new Order 53, at a time when a declaration could not be obtained by a private
citizen unless he could show (as in a claim for injunction) that a private right of
his was threatened or infringed. The new Order has made the remedy available
as an alternative, or an addition, to a prerogative order. Its availability has,
therefore, been extended, but only in the field of public law where a prerogative
order may be granted. I have already given my reasons for the view that this
extension is purely a matter of procedural law, and so within the rule-making
powers of the Rules Commitee. I therefore reject this submission of the Lord
Advocate.
16
I pass now to the two critical issues:
-
-
-
the character of the duty upon the Revenue and the persons to whom
it is owed. Is it legal, political, or merely moral? -
the nature of the interest which the applicant has to show.
-
-
It is an integral part of the Lord Advocate’s argument that the existence of the
duty is a significant factor in determining the sufficiency of an applicant’s
interest.
The Duty
Mandamus is the most elusive of the prerogative writs and orders. The nature
of the interest an applicant must show, the nature of the duty which it is
available to enforce, and the persons or bodies to whom it may issue have varied
from time to time in its development. It is, of course, a judicial remedy: it is
equally clear that it is a remedy to compel performance of a public legal duty,
that it does not go to the Crown itself, and that it is available only if the applicant
shows a sufficient interest. In Appendix 1 to Judicial Review of Administrative
Action (3rd ed. 1973) the late Professor S.A. de Smith, discussing the
historical origins of the prerogative writs, commented (p. 515) that:
“Through the writ of mandamus the King’s Bench compelled the
“carrying-out of ministerial duties incumbent upon both administrative
“and judicial bodies.”
Lord Mansfield clearly developed a very liberal view as to its availability.
“It ought to be used upon all occasions where the law has established no specific
“remedy, and where injustice and good government there ought to be one”:
Reg. v. Barker [1762] 3 Burr. 1265, at p. 1267. But it does not lie to compel
performance of a moral duty: Ex parte Napier [1852] 18 Q.B. 692. Nor may it
be used to enforce a duty owed exclusively to the Crown: Reg. v. Commissioners
of the Treasury [1872] L.R 7 Q.B. 387. It has, however, been recognised by
the judges as a remedy for certain forms of abuse of discretion, upon the
principle that the improper or capricious exercise of discretion is a failure to
exercise the discretion which the law has required to be exercised: see Lord
Mansfield C.J. in Reg. v. Askew [1768] 4 Burr. 2186 at pages 2188-9, and, in
modern times, Padfield v. Minister of Agriculture, Fisheries, and Food [1968]
A.C. 997. The Lord Advocate accepted, as I understand his argument, this
broad approach. But he strenuously submitted that the law imposed no such
public legal duty as that for which the Federation contends.
He submitted that one must examine what he appropriately described as
“the statutory code” to determine whether a duty owed to the applicant is
expressly or impliedly recognised by the law. If this be an invitation to consider
the relevant statutory provisions against a general background of legal principle
developed by the judges, I accept it. For this is the common law approach to
statute law.
First, then, “the statutory code”. It is to be found in the Inland Revenue
Regulation Act 1890 and the Taxes Management Act 1970. Commissioners
are appointed “for the collection and management of inland revenue”: section
1(1) Inland Revenue Regulation Act 1890. They “shall collect and cause to be
“collected every part of inland revenue”: section 13(1). “Inland revenue”
means the revenue and taxes “placed under the care and management of the
“Commissioners”: section 39. The Taxes Management Act 1970 places
income tax under their care and management and for that purpose confers upon
them and inspectors of tax very considerable discretion in the exercise of their
powers. It also imposes upon them the very significant duty of confidence in
investigating, and dealing with, the affairs of the individual taxpayer. Indeed,
the Lord Advocate relied on the existence of this duty as an indication that the
statute imposed no duty owed to a taxpayer (or the general body of taxpayers)
in respect of the collection of taxes due from another taxpayer: and he made
particular reference to sections 1 and 6 and Schedule 1 to the Act. He rightly
observed that in the daily discharge of their duties inspectors are constantly
required to balance the duty to collect “every part” of due tax against the duty of
good management. This conflict of duties can be resolved only by good
managerial decisions, some of which will inevitably mean that not all the tax
known to be due will be collected.
17
Upon this analysis of the statutes the Lord Advocate submitted that the law
neither imposes nor recognises a duty owed to an individual taxpayer or a group
of taxpayers to collect from other taxpayers all the tax due from them. He
supported his submission by a reference to Reg. v. Commissioners of the
Treasury, supra; and he emphasised that Parliament, and, since 1967, the
Parliamentary Commissioner, exist to redress the sort of grievance asserted by
the Federation in this case. His ultimate characterisation of the Revenue’s
failure in this case, if it was a failure, was “maladministration”, not breach of
any public duty owed at law to the general body of taxpayers.
While I reject his conclusion, I accept much, but not all, of his submission.
The analysis of the statutory provisions is clearly correct. They establish a
complex of duties and discretionary powers imposed and conferred in the
interest of good management upon those whose duty it is to collect the income
tax. But I do not accept that the principle of fairness in dealing with the affairs of
taxpayers is a mere matter of desirable policy or moral obligation. Nor do I
accept that the duty to collect “every part of inland revenue” is a duty owed
exclusively to the Crown. Notwithstanding the 1872 Treasury case (supra), I
am persuaded that the modern case law recognises a legal duty owed by the
Revenue to the general body of the taxpayers to treat taxpayers fairly; to use
their discretionary powers so that, subject to the requirements of good
management, discrimination between one group of taxpayers and another does
not arise; to ensure that there are no favourites and no sacrificial victims. The
duty has to be considered as one of several arising within the complex
comprised in the care and management of a tax, every part of which it is their
duty, if they can, to collect.
Authority for this view is plentiful, albeit only persuasive in character.
Viscount Simon L.C. in Latilla v. Inland Revenue Commissioners [1943]
A.C. 377 at p. 381, discussing the evil of tax avoidance schemes, commented
that:
“one result of such methods, if they succeed, is . . . to increase, pro tanto,
“the load of tax on the shoulders of the great body of good citizens”.
In the Arsenal case, loc.cit. at p. 17F Lord Wilberforce commented —
admittedly in the context of rates but in terms which cannot rationally exclude a
taxpayer — that
“To produce a sense of justice is an important objective of taxation
“policy”.
In Vestey v. Inland Revenue Commissioners (No. 2) [1979] Ch. 177,
Walton J. said at p. 197 that it is in “the interest not only of all individual
“taxpayers … but also in the interests of the Revenue, . . . that the tax system
“should be fair”; and at p. 204B:
“even if, contrary to my views, extra-statutory concessions are
“permissible and do form part of our tax code, nevertheless they do
“represent a published code, which applies indifferently to all those who
“fall, or who can bring themselves, within its scope”.
In the same case, when it reached the House, Lord Edmund-Davies, [1980]
A.C. 1148 at p. 1196, speaking of the House’s decision in Congreve v. Inland
Revenue Commissioners [1948] 1 All E.R. 948, said:
“But if it be permitted to stand, we have the deplorable situation that the
“Inland Revenue Commissioners can capriciously select which of several
“beneficiaries they are going to tax . . .”. (Emphasis supplied).
The duty of fairness as between one taxpayer and another is clearly
recognised in these (and other passages) in the modern case law. Is it a mere
moral duty, a matter for policy but not a rule of law? If it be so, I do not
understand why distinguished judges allow themselves to discuss the topic: they
are concerned with law, not policy. And is it acceptable for the courts to leave
matters of right and wrong, which give rise to genuine grievance and are
justiciable in the sense that they may be decided and an effective remedy
provided by the courts, to the mercy of policy? Are we in the twilight world of
“maladministration” where only Parliament and the Ombudsman may enter,
or upon the commanding heights of the law? The courts have a role, long
18
established, in the public law. They are available to the citizen who has a
genuine grievance if he can show that it is one in respect of which prerogative
relief is appropriate. I would not be a party to the retreat of the courts from this
field of public law merely because the duties imposed upon the Revenue are
complex and call for management decisions in which discretion must play a
significant role.
If it be urged that the House took a different view in the Arsenal Football
Club case, supra, I would reply that the view there expressed, in so far as it
concerned whether the Revenue owed a legal duty to the general body of
taxpayers, was obiter. The case should, perhaps, be considered more in the
context of an applicant’s interest than in that of the nature of the duty placed
upon the public authority: for it turned on the meaning to be attributed to a
person “aggrieved” in section 69 of the General Rate Act 1967.
It is, however, not decisive of either issue: and, for the reasons given by
Ackner L.J. in the Court of Appeal, I would refuse to introduce into the public
law the fine distinction, which the House in that case considered to exist,
between the duty of a rating authority and the duty of a taxing authority. I am,
therefore, of the opinion that a legal duty of fairness is owed by the Revenue to
the general body of taxpayers. It is, however, subject to the duty of sound
management of the tax which the statute places upon the Revenue.
The Interest
The sufficiency of the interest is, as I understand all your Lordships agree,
a mixed question of law and fact. The legal element in the mixture is less than
the matters of fact and degree: but it is important, as setting the limits within
which, and the principles by which, the discretion is to be exercised. At one time
heresy ruled the day. The decision of the Divisional Court in Reg. v. Lewisham
Union Guardians [1897] 1 Q.B. 498 was accepted as establishing that an
applicant must establish “a legal specific right to ask for the interference of the
“court” by order of mandamus: per Wright J. at p. 500. I agree with the
Master of the Rolls in thinking this was a deplorable decision. It was at total
variance with the view of Lord Mansfield. Yet its influence has lingered on, and
is evident even in the decision of the Divisional Court in this case. But the tide of
the developing law has now swept beyond it, as the Court of Appeal’s decision
in Reg. v. Greater London Council, Ex parte Blackburn [1916] 1 W.L.R. 550
illustrates. In the present case the House can put down a marker buoy warning
legal navigators of the danger of the decision. As Professor Wade pointed out,
Administrative Law, 4th Ed. 1977 at p. 610, if the Lewisham case were
correct, mandamus would lose its public law character, being no more than a
remedy for a private wrong.
My Lords, I will not weary the House with citation of many authorities.
Suffice it to refer to the judgment of Lord Parker C.J. in Reg. v. Thames
Magistrates’ Court, Ex parte Greenbaum, Knight’s L.G. Reports 129, a case
of certiorari; and to words of Lord Wilberforce in Gouriet v. Union of Post
Office Workers [1978] AC 435 at p. 482, where he stated the modern position
in relation to prerogative orders:
“These are often applied for by individuals and the courts have allowed
“them liberal access under a generous conception of locus standi”.
The one legal principle, which is implicit in the case law and accurately
reflected in the rule of court, is that in determining the sufficiency of an
applicant’s interest it is necessary to consider the matter to which the
application relates. It is wrong in law, as I understand the cases, for the court to
attempt an assessment of the sufficiency of an applicant’s interest without
regard to the matter of his complaint. If he fails to show, when he applies for
leave, a prima facie case, or reasonable grounds for believing that there has
been a failure of public duty, the court would be in error if it granted leave. The
curb represented by the need for an applicant to show, when he seeks leave to
apply, that he has such a case is an essential protection against abuse of legal
process. It enables the court to prevent abuse by busybodies, cranks, and other
mischief-makers. I do not see any further purpose served by the requirement for
leave.
19
But, that being said, the discretion belongs to the court: and, as my noble and
learned friend Lord Diplock has already made clear, it is the function of the
judges to determine the way in which it is to be exercised. Accordingly I think
that the Divisional Court was right to grant leave ex parte. Mr. Payne’s affidavit
of the 20th March 1979 revealed a prima facie case of failure by the Inland
Revenue to discharge its duty to act fairly between taxpayer and taxpayer. But
by the time the application reached the Divisional Court for a hearing, inter
partes, of the preliminary issue, two very full affidavits had been filed by the
Revenue explaining the “management” reasons for the decision not to seek to
collect the unpaid tax from the Fleet Street casuals. At this stage the matters of
fact and degree upon which depends the exercise of the discretion whether to
allow the application to proceed or not became clear. It was now possible to
form a view as to the existence or otherwise of a case meriting examination by
the court. And it was abundantly plain upon the evidence that the applicant
could show no such case. But the Court of Appeal, misled into thinking that, at
that stage and notwithstanding the evidence available, locus standi was to be
dealt with as a preliminary issue, assumed illegality (where in my judgment
none was shown) and, upon that assumption, held that the applicant had
sufficient interest. Were the assumption justified, which on the evidence it was
not, I would agree with the reasoning of Lord Denning M.R. and Ackner L.J.
I think the majority of the Court of Appeal, in formulating a test of genuine
grievance reasonably asserted, were doing no more than giving effect to the
general principle which Lord Mansfield had stated in the early days on the
remedy. Any more stringent test would, as Professor Wade, op.cit. p. 612
observes, open up “a serious gap in the system of public law.”
Lastly, I wish to comment shortly upon the duty of confidence owed by the
Revenue to every taxpayer and the right to discovery. The duty of confidence
can co-exist with the duty of fairness owed to the general body of taxpayers. It
is, however, of great importance when discovery is sought by an applicant, as
happened in this case. Upon general principles, discovery should not be
ordered unless and until the court is satisfied that the evidence reveals
reasonable grounds for believing that there has been a breach of public duty:
and it should be limited strictly to documents relevant to the issue which
emerges from the affidavits. The Revenue in any event will have the right in
respect of certain classes of document to plead “public interest immunity”, of
which in a proper case the court will be the arbiter: Burmah Oil Co. Ltd. v.
Governor and Company of The Bank of England [1980] AC 1090. In the
present case, had the Federation shown a sufficient interest, I doubt whether
any legitimate objection could have been taken to discovery of documents
relevant to the making of the special arrangement. Such documents would be
unlikely to contain any information about the affairs of any Fleet Street casual
who had succeeded by various devices in avoiding his identity being discovered
by the searches of the Revenue. But, be that as it may, discovery can safely be
left to the discretion of the court guided by the law as I believe it to be.
The Federation, having failed to show any grounds for believing that the
Revenue has failed to do its statutory duty, have not, in my view, shown an
interest sufficient in law to justify any further proceedings by the court on its
application. Had they shown reasonable grounds for believing that the failure to
collect tax from the Fleet Street casuals was an abuse of the Revenue’s
managerial discretion or that there was a case to that effect which merited
investigation and examination by the court, I would have agreed with the Court
of Appeal that they had shown a sufficient interest for the grant of leave to
proceed further with their application. I would, therefore, allow the appeal.
Lord Roskill
MY LORDS,
The appellants, The Commissioners of Inland Revenue, seek the reversal of
an order dated 27th February 1980 made by the Court of Appeal (Lord
Denning M.R and Ackner L.J. — Lawton L.J. dissenting) declaring that the
respondents, The National Federation of Self-Employed and Small Businesses
Ltd. had a “sufficient interest” to apply for judicial review in these proceedings
20
against the appellants. In making that declaration the Court of Appeal reversed
an order of the Divisional Court (Lord Widgery C.J. and Griffiths J., as he then
was) dated 22nd November 1979 refusing an application for judicial review
against the appellants, on the ground that the respondents had no such
“sufficient interest”.
My Lords, these proceedings were begun by the respondents who, on the
22nd of March 1979, applied ex parte for leave to apply for an order for judicial
review by way of mandamus and a declaration against the appellants. The ex
pane application was made in due form under Order 53 of the Rules of the
Supreme Court. The original statement lodged in support of the application
claimed first, a declaration that the appellants had exceeded their powers in
granting what was called an “amnesty” to casual workers in Fleet Street, and
secondly, an order of mandamus directing the appellants to assess and collect
income tax from those casual workers in Fleet Street “according to law”. A
subsequent amended statement substituted for the original declaration sought a
declaration that the appellants acted unlawfully in granting that “amnesty”. On
that ex parte application leave was granted. The hearing inter panes took place
on 21st and 22nd November 1979, when, as I have already stated, the
respondents’ application was refused for want of “sufficient interest”.
When the ex pane application was heard, the only evidence before the
Divisional Court was an affidavit from a Mr. Payne, a Vice-President of the
respondents. But on the hearing inter panes the Divisional Court also had long
affidavits from Sir William Pile, then Chairman of the appellants, and a Mr.
Hoadley, a Principal Inspector of Taxes. Mr. Hoadley had been personally
responsible for the negotiations which led to the so-called “amnesty” of which
the respondents sought to complain. After these affidavits had been sworn and
before that hearing inter panes the respondents had taken out a summons for
discovery against the appellants. By agreement, this summons was treated as a
summons for the discovery of specific documents. On 5th November 1979
Master Sir Jack Jacob Q.C. dismissed that summons for the reasons given in a
judgment of which your Lordships have a note. An appeal to the Divisional
Court from that dismissal was adjourned by agreement pending the final
determination of these proceedings.
My Lords, when the matter came before the Divisional Court inter panes it
was apparently agreed that the question whether or not the respondents had a
“sufficient interest” to bring these proceedings at all should be dealt with as a
preliminary point See the judgment of Lord Widgery C. J. reported in [1980] 2
All E.R. 378 at 382. When the respondents appealed to the Court of Appeal
that preliminary point was the only issue before that court as it had been before
the Divisional Court. Moreover, in their printed case, the appellants averred
that this was the only issue to be determined by your Lordships’ House, the
appellants contending that, as a matter of law, the respondents had no
“sufficient interest”.
My Lords, your Lordships’ House has often protested about the taking of
short-cuts in legal proceedings, most recently in Allen v. Gulf Oil Refining Ltd.
[1981] 1 A11 E.R. 353. The number of cases in which it is legitimate to take such
short-cuts is small and in my opinion the present was not such a case. Indeed,
many of the difficulties which were canvassed at length in arguments before
your Lordships’ House would have been avoided had this particular short-cut
not been taken. With profound respect to the Divisional Court, this course was
especially inappropriate where the grant or refusal of the remedy sought by way
of judicial review is, in the ultimate analysis, discretionary, and the exercise of
that discretion and the determination of the sufficiency or otherwise of the
applicants’ interest will depend, not upon one single factor — it is not simply a
point of law to be determined in the abstract or upon assumed facts — but upon
the due appraisal of many different factors revealed by the evidence produced
by the parties, few if any of which will be able to be wholly isolated from the
others.
My Lords, much time was spent in the courts below and in argument before
your Lordships’ House with citation of well-known cases, some of now
respectable antiquity in which prerogative orders or formerly prerogative writs
have been allowed to issue or have been refused. With all respect to the
21
authority of the judges by whom those cases were decided, such decisions are
today of little assistance for two reasons. First, in the last thirty years — no
doubt because of the growth of central local government intervention in the
affairs of the ordinary citizen since the second World War, and the consequent
increase in the number of administrative bodies charged by Parliament with the
performance of public duties — the use of prerogative orders to check
usurpation of power by such bodies to the disadvantage of the ordinary citizen,
or to insist upon due performance by such bodies of their statutory duties and to
maintain due adherence to the laws enacted by Parliament, has greatly
increased. The former and stricter rules determining when such orders, or
formerly the prerogative writs, might or might not issue, have been greatly
relaxed. It is unnecessary in the present appeal to trace through a whole series of
decisions which demonstrates that change in legal policy. The change is well
known as are the decisions.
Secondly, since those cases were decided and following the change in legal
policy to which I have just referred, Order 5 3 was introduced into the Rules of
the Supreme Court in 1977. For ease of reference I set out the most relevant
parts of certain of the Rules of that Order.
“1.—(1) An application for —
“(a) an order of mandamus, prohibition or certiorari, or
“(b) ….
“shall be made by way of an application for judicial review in accordance
“with the provisions of this Order.
“(2) An application for a declaration or an injunction (not being an
“injunction mentioned in paragraph (l)(b)) may be made by way of an
“application for judicial review, and on such an application the Court
“may grant the declaration or injunction claimed if it considers that,
“having regard to —
“(a) the nature of the matters in respect of which relief may be
“granted by way of an order of mandamus, prohibition or
“certiorari,
“(b) the nature of the persons and bodies against whom relief may be
“granted by way of such an order, and
“(c) all the circumstances of the case,
“it would be just and convenient for the declaration or injunction to be
“granted on an application for judicial review.
“2. On an application for judicial review any relief mentioned in rule
“1(2) or (2) may be claimed as an alternative or in addition to any other
“relief so mentioned if it arises out of or relates to or is connected with the
“same matter.
“3.—(1) No application for judicial review shall be made unless the
“leave of the Court has been obtained in accordance with this rule.
“(2) An application for leave must be made ex pane to a Divisional
“Court of the Queen’s Bench Division, except “
“(5) The Court shall not grant leave unless it considers that the
“applicant has a sufficient interest in the matter to which the application
“relates.”
My Lords, I would make these comments upon Order 53 at this juncture.
First, the changes thereby effected though seemingly changes in procedure and
thus made as part of the Rules of the Supreme Court, were and were intended to
be far-reaching. They were designed to stop the technical procedural arguments
which had too often arisen and thus marred the true administration of justice,
whether a particular applicant had pursued his claim for relief correctly,
whether he should have sought mandamus rather than certiorari, or certiorari
rather than mandamus, whether an injunction or prohibition, or prohibition
rather than an injunction or whether relief by way of declaration should have
been sought rather than relief by way of prerogative order. All these, and the
like technical niceties, were to be things of the past. All relevant relief could be
claimed under the general head of “judicial review”, and the form of judicial
review sought or granted (if at all) was to be entirely flexible according to the
needs of the particular case. The claims for relief could be cumulative or
alternative under rule 2 as might be most appropriate.
22
Secondly, relief by way of declaration, or injunction, was made a form of
judicial review to be granted in an appropriate case having regard to the factors
mentioned in rule 1(2). Thirdly, Order 53 took effect on the 11th January 1978,
some six months after the decision of your Lordships’ House in Gouriet v.
H.M. Attorney-General [1978] AC 435, on the 26th July 1977, an authority
much relied upon by the learned Lord Advocate on behalf of the appellants in
support of his submissions regarding the circumstances in which declarations
might be granted. But Gouriet’s case was a relator action and was not
concerned with prerogative orders or judicial review, and the relevant
observations of your Lordships must be read in the light of that fact and of the
subsequent enactment of Order 53.
My Lords, I venture to draw attention to the passage in the speech of my
noble and learned friend, Lord Wilberforce, at pp. 482/3, where he stated that
the courts had granted individuals more liberal access in the case of application
for prerogative writs and orders, and had adopted a more generous concept of
locus standi in those cases, for the individual was then seeking to enforce a
public right, and to invite the court to control by use of the prerogative power
alleged abuse of authority or jurisdiction.
Fourthly, as already stated, the discretionary nature of the remedy of judicial
review is emphasised by the fact that rule 3( 1) denies the individual the right to
apply for judicial review unless leave so to apply has first been obtained ex
parte. Fifthly, the court is enjoined by rule 3(5) not to grant leave unless the
applicant has a “sufficient interest” in the matter to which the application
relates, plain words of limitation upon an applicant’s right to relief.
In my opinion it is now clear that the solution to the present appeal must lie in
the proper application of the principles now enshrined in Order 5 3, in the light of
modern judicial policy to which I have already referred, to the facts of the
present case without excessive regard to the fetters seemingly previously
imposed by judicial decisions in earlier times and long before that modern
policy was evolved or Order 53 was enacted.
My Lords, the all important phrase in rule 3(5) is “sufficient interest”.
Learned counsel were agreed that this phrase had not been used in any previous
relevant enactment. My Lords, careful review of the earlier authorities in which
learned counsel for both parties engaged, reveals that many different phrases
have been used in different cases to describe the required standing of a
particular applicant for what is now described as judicial review before the
courts would entertain his application. He might be “a party” to the relevant
proceedings. He might be “a person aggrieved”. He might be “a person with a
“particular grievance”. He might be a “stranger”. All those, and some other
phrases, will be found in the cases. None is exhaustive or indeed definitive and
indeed in this field it would be, I think, impossible to find a phrase which was
exhaustive or definitive of the class of person entitled to apply for judicial
review. No doubt it was for this reason that the Rules Committee of the
Supreme Court in 1977 selected the phrase “sufficient interest” as one which
could sufficiently embrace all classes of those who might apply, and yet permit
sufficient flexibility in any particular case to determine whether or not
“sufficient interest” was in fact shown. So far as the researches of counsel went,
the origin of this phrase appears to lie in an interlocutory observation made by
the Court in Reg. v. Gotham [ [1898] 1 Q.B. 802 at 804, and in its use by Avory
L. in his judgment in Ex parte Stott [1916] 1 K.B. 7.
Your Lordships’ attention was drawn to a note to Order 53 at p. 831 of the
1979 Annual Practice, which your Lordships were told bore the authority of
Master Sir Jack Jacob, Q.C. The learned editor stated that that which was a
“sufficient interest” “appears to be a mixed question of fact and law; a question
“of fact and degree and the relationship between the applicant and the matter to
“which the application relates, having regard to all the circumstances of the
“case.” With this admirably concise statement, I respectfully agree.
The learned Lord Advocate founded his main submission upon section 1 of
the Inland Revenue Act 1890 which still remains upon the statute book and
sections 1 and 6 and Schedule 1 to the Taxes Management Act 1970. Those
statutory provisions, he claimed, defined the relevant duties of the appellants.
They established not only the appellants’ duties, but also their strict obligation
23
of confidentiality as between the appellants and each individual taxpayer,
subject only to the exceptions for which the statutes made express provision.
The subject-matter of the present application was the alleged liability of others
to pay income tax and averred a duty upon the appellants to assess and collect
tax upon the Fleet Street casual workers identified as a class but not
individually. But, the learned Lord Advocate submitted, the duties of the
appellants, as circumscribed by these statutes, precluded the possibility of any
other individual taxpayer, or the respondents as a representative group of other
taxpayers, from having any “sufficient interest” in the performance by the
appellants of their statutory duties, vis-a-vis the Fleet Street casual workers, so
that there was no jurisdiction to grant the respondents the relief which they
sought. The learned Lord Advocate sought to distinguish the rating cases, such
as Arsenal Football Club Ltd. v. Ende [1979] A.C. 1, on the ground that in
rating law there was a statutory duty to publish a valuation list containing
specific valuations and correct any valuations in that list which might be shown
to be wrong. Thus there was, under the rating legislation, a community of
interest between ratepayers which did not exist as between taxpayers. Reliance
was also placed upon the fact that Mr. Ende’s attempt to prove his locus standi
as a taxpayer as well as a ratepayer failed on the ground that the former interest
was too remote. Nowhere in the two statutes to which your Lordships were
referred was there any express provision which recognised any interest by one
taxpayer in the affairs of another taxpayer, or in the assessment and collection
of tax on and from such other taxpayer. Unless there was a relevant duty cast by
statute on the appellants in which the respondents could show a “sufficient
“interest”, there could be no jurisdiction to make an order for judicial review,
there being no relevant relationship on the part of the respondents to the subject-
matter of their application.
My Lords, at an early stage of his submissions, the learned Lord Advocate
accepted that the question raised in the instant appeal involved the performance
by the appellants of a public duty. In my opinion that concession (if concession
be the right word) was clearly properly made. But once it is made, I find it
difficult to see how it can be said that there is no jurisdiction of the court to allow
relief against the appellants by way of a judicial review. The appellants are, and
must as a public body charged with the performance of a public duty of crucial
importance be, amenable to the general law and liable to possible correction if
their statutory powers are exceeded, or their statutory duties are not lawfully
discharged. But to say that, and to accept that there is jurisdiction to grant relief
against the appellants in a proper case, is a very different matter from saying
that in the instance case relief should be granted to the respondents as being
possessed of that “sufficient interest” which is a condition precedent to their
obtaining the relief which they seek.
Mr. Harvey Q.C., for the respondents, contended that not only was there
jurisdiction to grant the relief sought but that his clients had a “sufficient
“interest” to be granted that relief because once it was accepted that the
appellants were a statutory body charged with the performance of a public duty,
any member of the public had a right to come to the court and complain that that
duty had not been performed in some relevant respect, and that this right of that
member of the public did not depend upon the precise nature of the obligation
cast by the statute upon the appellants. More narrowly, Mr. Harvey argued that
an individual taxpayer had as much interest in the performance by the
appellants of their statutory duty as the ratepayer in Ende’s case, and was not
too remote from the appellants in seeking to insist upon performance of their
duty in accordance with the law, a submission which found favour in the Court
of Appeal with Ackner L.J. Ultimately Mr. Harvey did not go so far as to assert
that the appellants’ statutory duty required them in every case to exact every
penny which might be lawfully exigible from each individual taxpayer, but he
asserted that there was already some evidence in the present case, and that after
discovery against the appellants there might well be further evidence, that in
granting the so-called “amnesty” and in agreeing to forego collection of past
arrears of tax from the Fleet Street casual workers, the appellants had been
moved by impermissible influences such as fears of industrial action in Fleet
Street, and thus had failed to perform the statutory duties with which they were
charged in accordance with the law. Hence, he argued that the relief sought
should be granted. These casual workers, it was said, had defrauded the general
24
body of taxpayers, and it was the right of the respondents as the representatives
of a substantial body of taxpayers who like others were adversely affected by
these frauds by the casual workers not only escaping the normal consequences
of such fraud but positively gaining as a result of the “amnesty”, to complain
and to seek strict enforcement of the appellants’ statutory duty to assess and
collect the tax due from these casual workers.
My Lords, the learned Master of the Rolls was willing to accept the wider of
these propositions founded upon what he had previously said in McWhirter’s
case, [1973] Q.B. 629 at 646, and again in a revised form in Blackburn’s case
[1976] 1 W.L.R. 550 at 559. He accepted that my noble and learned friend,
Lord Wilberforce, had expressly disapproved the former passage in his speech
in Gouriet’s case [1978] A.C. at p. 483 but claimed that that disapproval was
limited to relator actions such as Gouriet’s case was. My Lords, with profound
respect I cannot agree. Though my noble and learned friend’s disapproval was,
of course, made in the context of a relator action, the view of the learned Master
of the Rolls, if applied to all applications for judicial review, would extend the
individual’s right of application for that relief far beyond any acceptable limit,
and would give a meaning so wide to a “sufficient interest” in Order 53 rule 3(5)
that they would in practice cease to be, as they were clearly intended to be,
words of limitation upon that right of application.
More powerful support for Mr. Harvey’s narrower submission is to be found
in the judgment of Ackner L.J. The learned Lord Justice found it impossible to
distinguish between the position of a ratepayer who was entitled to the relief
sought as, for example, in Ende’s case, and a taxpayer who, it was said, was not
entitled to the like relief. The test, according to the learned Lord Justice, was
whether the assertion of the grievance could be justified on reasonable grounds.
Both the learned Master of the Rolls and Ackner L.J. proceeded on the basis
that it should be assumed (the Master of the Rolls went so far as to say that it
was a matter of concession) that the appellants had acted unlawfully because
they had no dispensing power. My Lords, there was certainly some confusion in
the Court of Appeal as to what was conceded or what was to be assumed, a
confusion not resolved before your Lordships’ House. But whatever may have
been assumed or conceded, or thought to have been assumed or conceded in the
Court of Appeal, the learned Lord Advocate was not prepared to invite the
making of any assumption or to make any concession before your Lordships’
House, and I think he was right to adopt this attitude. For my part, I decline in a
matter of this kind to make any assumption of any kind, let alone an assumption
of illegality on the part of the appellants. This appeal must be determined on the
totality of the evidence as it was before the Divisional Court and the Court of
Appeal. No question of any dispensing power is involved. The appellants were
in no way arrogating to themselves a right or inviting assumption of an
arrogation to themselves of a right not to comply with their statutory obligations
under the statutes to which I have referred. On the contrary, their whole case
was that they had made a sensible arrangement in the overall performance of
their statutory duties in connection with taxes management, an arrangement
made in the best interests of everyone directly involved and, indeed, of persons
indirectly involved, such as other taxpayers, for the agreement reached would
be likely to lead ultimately to a greater collection of revenue than if the
agreement had not been reached or “amnesty” granted.
My Lords, with profound respect to both courts below I do not think that
either approached this application for judicial review on a correct basis in point
of law. In my opinion the Divisional Court was wrong for the reasons I have
given for refusing relief for they dealt with the relevant issue as a matter of
jurisdiction and not as one of overall discretion. I also think that the majority of
the Court of Appeal was wrong in granting the relief claimed either on the wider
ground the learned Master of the Rolls preferred or on the narrower ground
which appealed to Ackner L.J.
My Lords, I hope I yield to no one in stressing the importance that relief by
way of judicial review should be freely available in whatever form may be
appropriate in a particular case, and it is today especially important not to cut
down by judicial decision the scope of Order 53 in creating modern procedure
for applications for judicial review. I emphasise in particular that relief by way
25
of declaration is expressly made a form of judicial review additional to or
alternative to relief by way of prerogative order or injunction. The court has a
general discretion which, if any, relief shall be granted and many of the old
decisions restricting the circumstances in which declarations may be granted to
establish legal rights seem to me to be no longer in point. On the other hand, it is
equally important that the courts do not by use or misuse of the weapon of
judicial review cross that clear boundary between what is administration,
whether it be good or bad administration, and what is an unlawful performance
of the statutory duty by a body charged with the performance of that duty. If the
body against which an order of judicial review is sought is for some reason not
amenable to such an order, then clearly there is no jurisdiction to allow the order
to go. But once that body is admitted to be, as the appellants are admitted to be,
a statutory body charged with the performance of a public duty, then it is clear
that there is jurisdiction to grant an order of judicial review in a proper case; and
to the extent that the learned Lord Advocate contended otherwise, I reject his
argument. But the arguments that he advanced on jurisdiction which I have
rejected become highly relevant when the question of “sufficient interest”
arises. The first question must be to enquire what is the relevant duty of the
statutory body against which the order is sought, of the performance or non-
performance of which complaint is sought to be made. For that I turn to the
sections of the statutes upon which the learned Lord Advocate relied. The
appellants are responsible for the overall management of the relevant part of the
taxation system of this country, and for the assessment and collection of taxes
from those who are, by law, liable to pay them. Such assessment and collection
is a confidential matter between the appellants and each individual taxpayer.
Such confidence is allowed to be broken only in those exceptional circumstances
for which the statute makes express provision.
The next matter is to consider the complaint made and the relief sought.
It is clear that the respondents are seeking to intervene in the affairs of
individual taxpayers, the Fleet Street casual workers, and to require the
appellants to assess and collect tax from them which the appellants have clearly
agreed not to do. Theoretically, but one trusts only theoretically, it is possible to
envisage a case when because of some grossly improper pressure or motive the
appellants have failed to perform their statutory duty as respects a particular
taxpayer or class of taxpayer. In such a case, which emphatically is not the
present, judicial review might be available to other taxpayers. But it would
require to be a most extreme case for I am clearly of the view, having regard to
the nature of the appellants’ statutory duty and the degree of confidentiality
enjoined by statute which attaches to their performance, that in general it is not
open to individual taxpayers or to a group of taxpayers to seek to interfere
between the appellants and other taxpayers, whether those other taxpayers are
honest or dishonest men, and that the court should, by refusing relief by way of
judicial review, firmly discourage such attempted interference by other
taxpayers. It follows that, in my view, taking all those matters into account, it
cannot be said that the respondents had a “sufficient interest” to justify their
seeking the relief claimed by way of judicial review.
I have already said that the court must not cross that boundary between
administration whether good or bad which is lawful, and what is unlawful
performance of a statutory duty. Much time was spent upon considering the
relevance of the Parliamentary Commissioner Act 1967. My Lords, I shall
spend no time upon its provisions, for it deals with the injustices caused by
maladministration. The remedy thereby accorded to the individual citizen may
be very effective in a proper case, but the existence of that remedy seems to me
irrelevant to the question now under consideration which depends not upon
allegations of maladministration leading to injustice, but upon allegations of
illegality in the performance of statutory duties. I doubt whether in considering
whether legal redress by way of judicial review should be granted, it is in any
way relevant to consider the existence of this other mode of redress of other
grievances. Certainly, as at present advised, I do not consider the existence of
this other mode of redress can narrow the field in which judicial review if
otherwise proper is available. The latter is a remedy available from Her
Majesty’s courts for the purpose of redressing legal wrongs. The former has a
wholly different origin and is designed to redress administrative wrongs, not
remediable in the courts.
26
I ought, however, to deal with the further question whether even if (contrary
to my opinion) the respondents could show a “sufficient interest” there is
anything in the evidence as a whole allowing the respondents to interfere by way
of obtaining an order of judicial review. I have already considered the scope of
the appellants’ duties and the nature of the complaint which they make. It is at
this point that the answer to this complaint becomes relevant and ought to have
been, but was not, considered by the Divisional Court To my mind it is clear
beyond argument when one reads the affidavits of Sir William Pile and Mr.
Hoadley that what was done was a matter of taxes management, and I can see
no shadow of dereliction of duty by the appellants, or any suggestion of
improper or unlawful conduct on their part. On the contrary, what they did
seems to me to have been a matter of administrative common sense. Instead of
wasting public time and money in seeking to collect taxes from persons whose
names were unknown and whose ability to pay was therefore equally unknown,
they made an arrangement which enabled taxes not hitherto able to be collected
or in fact collected, collectable in the future at a cost to the general body of
taxpayers of foregoing the collection of that which in reality could never have
been collected.
In my view the Divisional Court ought in the exercise of its discretion to have
dismissed this application, not for want of jurisdiction to grant it, but because, on
the evidence as a whole, first no “sufficient interest” was shown and, secondly,
because in any event the application could not possibly succeed. Since that
court did not exercise its discretion, and since the majority of the Court of
Appeal was, in my view, wrong in law in making the declaration which was
there granted and therefore did not exercise the discretion vested in that court, I
think it open to your Lordships’ House to exercise the discretion which ought to
have been exercised in the first instance by the Divisional Court. On that basis I
would dismiss the application for judicial review thus reaching the same result
as did Lawton L.J. in his dissenting judgment in the Court of Appeal.
I would only add that Mr. Harvey urged that something advantageous to his
clients might emerge upon discovery. He submitted that your Lordships ought
not to dispose of this appeal on the basis of the affidavit evidence alone. My
Lords, the respondents started these proceedings on the basis of an affidavit
which was fully answered by the two affidavits to which I have just referred.
With all respect to Mr. Harvey’s argument I can see no reason to allow the
respondents what I am afraid I must necessarily regard as a fishing expedition in
the hope of obtaining on discovery something which might counter that which
appears so clearly from the affidavits filed on behalf of the appellants.
My Lords, since preparing this speech, I have had the advantage of reading in
draft the speeches of my noble and learned friends, Lord Wilberforce and Lord
Fraser of Tullybelton. I am in full agreement with what both my noble and
learned friends have said.
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