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Bhatt Murphy (a firm), R (on the application of) v The Independent Assessor
Factual and Procedural Background
There are two sets of appellants before the court, referred to as "the applicants" and "the solicitors". They challenge two decisions announced by the Secretary of State on 19 April 2006 concerning compensation schemes for victims of miscarriages of justice. Until that date, two concurrent schemes existed: a statutory scheme under section 133 of the Criminal Justice Act 1988 ("the 1988 Act") and a discretionary scheme operated under the Crown's common law powers. The challenged decisions were (1) the withdrawal of the discretionary scheme for new applications and (2) the decision by the Independent Assessor to reduce legal costs payable in relation to compensation applications to rates corresponding to Legal Help fees under the Community Legal Service (Funding) Order 2000, replacing the previously more generous private fee rates.
The applicants are three individuals who claim to have suffered miscarriages of justice and had instructed solicitors before 19 April 2006 but had not submitted applications before that date. None qualify for compensation under the statutory scheme, relying instead on the discretionary scheme. The solicitors are six specialist firms experienced in representing such claimants. Both groups sought judicial review of the respective decisions, which were dismissed by the Divisional Court. Both appellants were granted permission to appeal.
The case involves revisiting the developing law of legitimate expectations in public law.
Legal Issues Presented
- Whether the appellants had a legitimate expectation that the discretionary compensation scheme would continue to be available for new applications after 19 April 2006.
- Whether the appellants had a legitimate expectation that legal costs would continue to be assessed and paid at private client rates rather than at the reduced Legal Help rates.
- Whether the Secretary of State or the Independent Assessor was required to consult the appellants or solicitors before implementing these changes.
- What legal principles govern substantive and procedural legitimate expectations in the context of changes to public compensation schemes.
Arguments of the Parties
Applicants' Arguments
- The Secretary of State should have consulted before withdrawing the discretionary scheme, constituting a secondary procedural legitimate expectation.
- The applicants should have received advance notice of the withdrawal so that claims could be submitted before the cut-off date, amounting to a substantive legitimate expectation.
- The Home Office's own consultation code and website statements created a promise to consult before policy changes.
Solicitors' Arguments
- The Independent Assessor should have consulted them before changing the legal costs policy, invoking the secondary procedural legitimate expectation.
- They had a substantive legitimate expectation that legal costs for cases where they were retained before 19 April 2006 would continue to be paid at private client rates, including for cases where applications had not yet been submitted.
- The transitional arrangements made were insufficient and unfair, and a more generous approach should have been adopted.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Ex p Coughlan [2001] QB 213 | Development of legitimate expectation doctrine; distinction between procedural and substantive legitimate expectations; enforcement of promises or practices inducing legitimate expectations. | Used to explain the evolving nature of legitimate expectations and to distinguish between procedural and substantive claims. |
| Ex p Begbie [2000] 1 WLR 1115 | Limits on legitimate expectations; importance of fairness and public interest balancing in substantive expectations. | Referenced in relation to the scope and limits of substantive legitimate expectation claims. |
| Re McFarland [2004] UKHL 17 | Interpretation of statutory compensation scheme for miscarriages of justice. | Considered in relation to the statutory scheme and the principle that compensation is not dependent on proof of official wrongdoing. |
| Ex p Unilever [1996] STC 681 | Secondary procedural legitimate expectation requiring consultation before policy changes affecting benefits without prior promise or practice. | Applied to illustrate the exceptional circumstances where failure to consult was unfair and amounted to abuse of power. |
| Ex p Schemet [1993] 1 FCR 306 | Secondary procedural legitimate expectation requiring communication of rational grounds and opportunity to comment before withdrawal of benefit. | Discussed but distinguished as not supporting as broad a duty to consult as contended by appellants. |
| Kruse v Johnson [1898] 2 QB 91 | Broad principles of public law constraining arbitrary exercise of public powers. | Referenced in the context of the general framework of public law and policy formulation. |
| R v MAFF, ex parte Hamble Fisheries [1995] 2 All ER 714 | Legitimate expectation met by reasonable transitional provisions mitigating impact of policy change. | Used to support the view that transitional provisions here satisfied legitimate expectations. |
Court's Reasoning and Analysis
The court undertook a detailed examination of the doctrine of legitimate expectations, distinguishing between procedural and substantive types. It identified a "paradigm case" of procedural expectation involving an explicit promise or practice to consult before policy changes, which was not established here. The Home Office Code of Practice and website statements did not constitute such a promise or undertaking.
The court further considered a secondary procedural legitimate expectation, where no prior promise exists but fairness may require consultation before a change that adversely affects specific persons with a substantial interest in the policy. The court held that this secondary procedural expectation applies only in exceptional, pressing, and focussed circumstances, which were not present here given the broad nature of the policy and the number of affected persons.
Regarding substantive legitimate expectation, the court emphasized that only specific, clear, and unambiguous assurances directed to particular individuals or groups can give rise to enforceable substantive expectations. The mere existence of a policy or scheme without a promise of its continuation does not suffice. The applicants and solicitors had no evidence of any such assurance or promise that the discretionary scheme or the prior legal costs regime would continue unchanged.
The court noted that the solicitors were entitled to terminate their retainers in light of the cost reductions, and transitional arrangements allowed for some protection of costs incurred before 19 April 2006. These arrangements were not unfair or an abuse of power.
Overall, the court found no legitimate expectation, procedural or substantive, that constrained the Secretary of State or the Independent Assessor from implementing the changes announced on 19 April 2006. The court acknowledged the wide discretion public authorities have in policy formulation, subject to fairness and public law principles, but found no breach here.
Holding and Implications
The appeals are dismissed.
The court held that neither the applicants nor the solicitors had enforceable legitimate expectations preventing the withdrawal of the discretionary compensation scheme or the reduction of legal costs to Legal Help rates. The Secretary of State and the Independent Assessor were not obliged to consult before implementing these changes, as no clear promise or practice to consult existed, and the circumstances did not amount to the exceptional secondary procedural legitimate expectation. Transitional provisions and the solicitors' ability to terminate retainers mitigated any adverse effects.
This decision directly affects the parties by upholding the policy changes and does not establish new precedent beyond clarifying the application of legitimate expectation doctrines in this context.
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