James v Hertsmere Borough Council

Factual and Procedural Background

In November 2017, the Appellant applied to Company A for accommodation on the basis of homelessness. Company A conducted inquiries and decided that the Appellant was not vulnerable and was intentionally homeless, thus not in priority need under the Housing Act 1996. The Appellant requested a statutory review under the Act, which was conducted and confirmed the original decision. The review was not completed within the statutory 56-day period, taking 28 weeks instead, partly due to the need to consider additional medical evidence. This delay raised issues related to the contracting out of the review function by Company A to a private entity, Company B, under a contract signed in August 2017.

The contract authorized Company B to carry out homelessness reviews under the Housing Act 1996 over a specified term initially from September 2017 to April 2018, with provisions for extensions. The review in question spanned before and after the initial contract term. The Appellant appealed the review decision to the county court under section 204 of the Housing Act 1996, challenging the lawfulness of the contracted-out review decision and subsequent ratifications of the contract extension.

The county court dismissed the appeal, holding that the extension of the contract was either authorized or ratified by Company A’s officials, and that any irregularities were matters of form rather than substance. The Appellant then appealed to the higher court, focusing on whether the county court had jurisdiction to consider the contracting out issue and the lawfulness of the contract extension and ratification.

Legal Issues Presented

1. Whether the county court has jurisdiction under section 204 of the Housing Act 1996 to consider the lawfulness of the contracting out of homelessness review functions.
2. Whether it is sufficient that the review process started during the initial contract term but was completed after it expired.
3. Whether the Authorised Officer had authority to agree to extend the contract.
4. Whether any agreement to extend the contract had to be recorded in writing.
5. Whether the contract extension was validly ratified by Company A’s Leader or Chief Executive.

Arguments of the Parties

Appellant's Arguments

• The review decision was of no effect because the contracted-out review function was not lawfully authorized.
• Subsequent attempts to ratify the contract extension were ineffective as ultra vires acts cannot be ratified.
• The contract extension required written authorization which was absent.
• The county court lacked jurisdiction to consider challenges to the contracting out under section 204.

Respondent's Arguments (Company A)

• The county court has jurisdiction under section 204 to consider all points of law arising from the review decision, including challenges to contracting out.
• The review was lawfully commenced within the contract term, and completion after expiry was authorized.
• The Authorised Officer had authority to agree to the contract extension, including orally.
• The contract extension was validly ratified by the Leader and Chief Executive of Company A.
• Challenges to contracting out should be dealt with under judicial review, but in this case, the county court jurisdiction applies.

Table of Precedents Cited

Court's Reasoning and Analysis

The court first addressed the jurisdictional scope of section 204 of the Housing Act 1996, holding that the county court’s jurisdiction includes any point of law arising from a review decision, extending broadly to challenges that would otherwise be subject to judicial review, including procedural errors, vires, irrationality, and adequacy of reasons. The court rejected a narrow interpretation that would confine jurisdiction only to errors intrinsic to the review decision or occurring between the review request and decision.

The court considered the contracting out of the homelessness review function lawful and noted that the review in question was commissioned during the contract term. It held that it was sufficient for authorization that the review was initiated within the contract term, even if completion occurred after expiry, as this interpretation aligns with the contract’s purpose and practicalities of continuous public function delivery.

Regarding authority to extend the contract, the court expressed doubt that the Authorised Officer alone had authority to bind the Council to an extension, especially without formal delegation. The Chief Executive’s retrospective approval was also questioned due to lack of contemporaneous delegation.

On whether the contract extension required written form, the court found the contract ambiguous but declined to decide definitively, noting it was unnecessary given other findings.

Finally, the court upheld the validity of ratification by the Leader and Chief Executive of the Council, finding that ratification cured any defects in authority and that such acts were within the Council’s powers and not ultra vires. The court emphasized that ratification remedied form defects without affecting substantive rights of the Appellant.

Holding and Implications

The court DISMISSED THE APPEAL.

The court held that:

• The county court has jurisdiction under section 204 to consider challenges to the lawfulness of contracting out decisions as points of law arising from review decisions.
• The review decision was lawful because the review was commissioned within the contract term, authorizing completion thereafter.
• If the above were incorrect, ratification of the contract extension by the Council’s Leader and Chief Executive was valid and cured any defects.

The decision confirms the broad scope of county court jurisdiction on homelessness review appeals, clarifies contractual interpretation in the context of contracting out, and affirms the validity of ratification of public authority acts that are within power. No new precedent was set beyond clarifying existing legal principles, and the direct effect is the upholding of the lawfulness of the contracted-out review decision in this case.