Judicial review
Public bodies, such as Ofgem, have both statutory duties which must be performed and powers which allow for a large element of discretion. Similarly, the Secretary of State for Energy Security and Net Zero has wide powers to make decisions about energy policy in the UK. There is usually no right of appeal against a failure to perform a ‘power’, or as to how that discretion is exercised. However, this does not mean that nothing can be done. Such administrative matters are subject to control by judicial review1Part 54 CPR on the grounds of illegality, irrationality or procedural impropriety (see below). The exercise of any ‘public’ powers by any of the principal bodies discussed in this book and by the Secretary of State can be subject to judicial review.
An ‘illegal decision’ is one where the decision-making body has not been given the legal power to do what it has done – ie, if it has gone outside its remit or what it was set up to do.
An ‘unlawful decision’ is where a public body or the Secretary of State exceeds the powers available to them in law and the decision may be challenged in the courts. For example, the Secretary of State was ruled to have no power in law to alter tariffs affecting solar panels retrospectively.2Secretary of State for Energy and Climate Change v Friends of the Earth and Others [2012] EWCA Civ 28 An ‘unreasonable decision’ may arise where a public body has made a decision which is flawed in some way. In legal jargon, this is ‘Wednesbury’ unreasonableness, named after the court case in which the principle was established.3Associated Provincial Picture Houses v Wednesbury Corporation [1948] 1 KB 223 This principle requires a decision-making body to: •consider all relevant factors;
•disregard irrelevant factors;
•not act perversely or irrationally.
An ‘irrational decision’ is one which is so unreasonable that no reasonable authority could make it if it had properly considered the matter.
Public bodies (including Ofgem) are expected to follow their own rules and guidance and behave in a procedurally fair way.4British Oxygen Co Ltd v Minister for Technology [1971] AC 610 Challenges may be brought on grounds of ‘procedural impropriety’ where a public body fails to follows its own rules.5R v Director General of Gas Supply ex parte Smith 1989, unreported and CO/1398/88, 31 July (QBD) This can include breaches of ‘natural justice’, making decisions which are biased or unfair or which have the appearance of unfairness and prejudice to any impartial observer. If a decision-making body fails to adhere to the requirements of natural justice or the ’Wednesbury principles’, then its decisions may be challenged in the High Court by way of judicial review. Any expert evidence submitted is expected to comply with the civil procedure rules.6R (Jeremy Cox) v (1)The Oil and Gas Authority Office (2) Secretary of State for Business and Energy and Industrial Strategy [2022] EWHC 75 (Admin) In Scotland, an application is made to the Court of Session. In addition, breaches of the Equality Act 2010 may also be challenged in the High Court.7Ofgem, Consumer Vulnerability Strategy, 4 July 2013 Breach of one or more of these principles gives the court the power to overturn an authority’s decision. It is important to realise that a court cannot overturn a decision simply because it thinks it would have come to a different decision. The court does not put itself in the place of the decision maker, but merely ensures they have kept within the boundaries of the law and have reasonably interpreted guidance and policies.8May-Lean & Co Ltd v Gas and Electricity Markets Authority [2017] All ER (D) 78 It is possible for two different, even contradictory, decisions to lie within those boundaries so that it would be equally lawful for the decision maker to choose either. It should also be remembered that judicial review is viewed as a remedy of last resort, and you should normally exhaust all other available remedies before embarking upon it. For example, judicial review may not be commenced if the matter in question is still awaiting the result of an appeal or a decision by Ofgem.9R (on the application of Summerleaze Ltd) v Secretary of State for Energy and Climate Change [2015] EWHC 1729 (Admin) Applying for judicial review is a three-stage procedure.10Part 54 CPR You must serve a letter on the public body or minister setting out the claim and giving notice of intention to seek judicial review. You must first apply for leave (ie, permission for judicial review) by lodging an application with supporting documents and written evidence. A judge then considers the papers and decides whether leave should be granted – ie, permission to take the case on to a full judicial review hearing. In Scotland, the application is made to the Court of Session. In England and Wales, the court can make an order overturning a decision (‘quashing’ order) or requiring the body which is being judicially reviewed to do or not to do something (‘mandatory’ or ‘prohibitory’ order) in the same way as an injunction (here). In Scotland, a decision can be quashed by ‘reduction’, and a ‘declarator’ (‘declaration’ in England and Wales) can be issued establishing the legal position. From February 2022, claims involving public bodies in Wales are required to be issued and heard in Wales.11Practice Direction 54C; r7.1A CPR An E-Working Pilot Scheme PD51O has been introduced with the intention to increase the ability of the Administrative Court to work electronically with effect until 1 November 2024.12Practice Direction 510 supplements CPR rr5.5 and 7.12 It is important to realise that judicial review is a discretionary remedy and that different courts may or may not grant a remedy. Applications for judicial review in England and Wales must be made promptly to the High Court and, in any event, within three months of the relevant decision. The three-month period can be extended, but only where there are strong mitigating circumstances. Even if leave is granted, the court may still refuse relief at the full judicial review hearing. In Scotland, applications must be made to the Court of Session; there is no specific time limit, but applications must not be unduly delayed.
HM Courts and Tribunals Service has published a guide on bringing a judicial review case in the Administrative Court.13