Chapter 9 Notes on key cases

• Edwards v Bairstow [1956] AC 14: The classic case on review of decisions applying the law. Bairstow seized an opportunity to buy a spinning plant at the low price of £12,000; he sold it as soon as he could at a profit of £18,000. His tax liability depended on whether the venture was an ‘adventure or concern in the nature of trade’. The Inland Revenue assessed the profit as subject to tax; the General Commissioners held that the venture was not an adventure in the nature of trade. On an appeal on a point of law by the Revenue, a High Court judge upheld the Commissioners’ decision on the ground that the issue was a question of fact on which he could not overturn the view of the Commissioners unless it was perverse. The House of Lords overturned that decision. As to the application of the law to the facts, Lord Radcliffe held that if (as in this case) the law does not give a precise definition of the activity that is taxed, then there may be ‘many combinations of circumstances in which it could not be said to be wrong to arrive at a conclusion one way or the other. If the facts of any particular case are fairly capable of being so described, it seems to me that it necessarily follows that the determination of the Commissioners, Special or General, to the effect that a trade does or does not exist is not "erroneous in point of law"; and, if a determination cannot be shown to be erroneous in point of law, the statute does not admit of its being upset by the Court on appeal.’ But the House of Lords held in favour of the Revenue on the ground that the deal was undeniably an adventure in the nature of trade. In Lord Radcliffe’s view, ‘the only reasonable conclusion on the facts found is inconsistent with the determination come to’.

On review of ‘primary facts’, Viscount Simonds stated obiter the classic doctrine that the findings of the Commissioners could not be overturned in an appeal on a point of law unless they ‘acted without any evidence or upon a view of the facts which could not reasonably be entertained’.

• Anisminic v Foreign Compensation Commission [1969] 2 AC 147 (HL): The Foreign Compensation Commission was set up by an act of Parliament that provided that ‘The determination by the Commission of any application made to them under this Act shall not be called in question in any court of law’. The Commission rejected Anisminic’s application for compensation, and the company sought a declaration that the decision was unlawful. Their argument was simply that the Commission misinterpreted the criteria for compensation, yet the House of Lords issued the declaration. The majority (3-2) of the Law Lords held that the Commission had misinterpreted the criteria, and that their error of law was of such a kind that there was no ‘determination’ at all. According to Lord Reid, the Commission had decided the claim ‘on a ground which they had no right to take into account’ and as a result their decision was not a determination, but a nullity.

On the misinterpretation of this decision that has become the basis of the doctrine of review for error of law, see pp 303-5.

• Pearlman v Keepers and Governors of Harrow School [1979] QB 56 (CA): Ahead of his time (that is, before the House of Lords had settled on review for error of law), Lord Denning said that the distinction between an error which entails absence of jurisdiction, and an error made within the jurisdiction, ‘should now be discarded. …No court or tribunal has any jurisdiction to make an error of law on which the decision of the case depends. If it makes such an error, it goes outside its jurisdiction and certiorari will lie to correct it.’
• Re Racal [1981] AC 374 (HL): Lord Diplock’s first obiter statement of his misinterpretation (see pp 303-5) of Anisminic:Lord Diplock said that the reason for the rule was a presumption ‘that where a decision-making power is conferred on a tribunal or authority that is not a court of law, parliament did not intend’ to ‘confer upon administrative tribunals or authorities power to decide questions of law’. But Racal lost its claim for judicial review of an order of a High Court judge ordering inspection of its books for the purpose of investigating an allegation of a criminal offence. The House of Lords held that when a statute gives a decision-making power to a High Court judge, there is no presumption that Parliament did not intend to confer power to decide a question of law.

• ‘The break-through made by Anisminic was that, as respects administrative tribunals and authorities, the old distinction between errors of law that went to jurisdiction and errors of law that did not, was for practical purposes abolished. Any error of law that could be shown to have been made by them in the course of reaching their decision on matters of fact or of administrative policy would result in their having asked themselves the wrong question with the result that the decision they reached would be a nullity.’

• O’Reilly v Mackman [1983] 2 AC 237 (HL): Lord Diplock’s second obiter statement on the effect of Anisminic: in the course of outlining an ‘expansion of the grounds’ of judicial review (277) in the previous thirty years, as a prelude to arguing that public authorities needed procedural protection against actions for a declaration, Lord Diplock said,

• ‘The breakthrough that the Anisminic case made was the recognition by the majority of this House that if a tribunal whose jurisdiction was limited by statute or subordinate legislation mistook the law applicable to the facts as it had found them, it must have asked itself the wrong question, i.e., one into which it was not empowered to inquire and so had no jurisdiction to determine. Its purported "determination," not being a "determination" within the meaning of the empowering legislation, was accordingly a nullity.’ (278)

• R v Lord Chancellor, ex p Page [1993] AC 682: The House of Lords unanimously adopted Lord Diplock’s misinterpretation of Anisminic. But that was obiter, because the Law Lords held that Lord Diplock’s rule did not apply to University Visitors, on the ground that they apply the domestic law of the University, rather than the general law. For that reason, they would not be held to have acted outside their jurisdiction merely on the ground that they had made an error of law. But Lord Browne-Wilkinson held that even a University Visitor was subject to judicial review: ‘Judicial review does lie to the visitor in cases where he has acted outside his jurisdiction (in the narrow sense) or abused his powers or acted in breach of the rules of natural justice.’ (704)
• R v Monopolies and Mergers Commission, ex p South Yorkshire Transport [1993] 1 WLR 23: The Monopolies and Mergers Commission could only investigate mergers affecting ‘a substantial part of the United Kingdom’. A bus company sought judicial review on the ground that the Commission was investigating a merger that only affected a small part of the country (see p 335 for a map). The company argued that the Commission had jurisdiction only if the area affected was a substantial part of the UK, and that the court had to decide whether that was the case and impose it on the Commission in order to keep it within its jurisdiction. Lord Mustill said,

• ‘I agree with this argument in part, but only in part. Once the criterion for a judgment has been properly understood, the fact that it was formerly part of a range of possible criteria from which it was difficult to choose and on which opinions might legitimately differ becomes a matter of history. The judgment now proceeds unequivocally on the basis of the criterion as ascertained. So far, no room for controversy. But this clear-cut approach cannot be applied to every case, for the criterion so established may itself be so imprecise that different decision-makers, each acting rationally, might reach differing conclusions when applying it to the facts of a given case. In such a case the court is entitled to substitute its own opinion for that of the person to whom the decision has been entrusted only if the decision is so aberrant that it cannot be classed as rational: Edwards v Bairstow [1956] AC 14. The present is such a case. Even after eliminating inappropriate senses of “substantial” one is still left with a meaning broad enough to call for the exercise of judgment rather than an exact quantitative measurement. Approaching the matter in this light I am quite satisfied that there is no ground for interference by the court, since the conclusion at which the commission arrived was well within the permissible field of judgment.’ (at 32-3)

• Moyna v Work and Pensions Secretary [2003] UKHL 44: Mrs Moyna applied for a form of Disability Living Allowance that was available to a person who ‘cannot prepare a cooked main meal for himself if he has the ingredients’ (Social Security Contributions and Benefits Act 1992 s 72(1)(a)(ii)). She could cook for herself some days (more than half the time), but not always. She was turned down; she lost in the tribunal, and in an appeal to another tribunal on a question of law; she won in the Court of Appeal but finally lost in the House of Lords. Lord Hoffmann held that in an appeal on a point of law, the court should not overturn a decision applying the law to the facts ‘unless it falls outside the bounds of reasonable judgment’ [25].
• E v Home Secretary [2004] EWCA Civ 49: E sought asylum in Britain, claiming that he would be tortured if he were returned to Egypt, because he was a supporter of the Muslim Brotherhood. The tribunal concluded that the persecution of Muslim Brotherhood members had ended; E wanted to introduce new evidence. The Court of Appeal held that the new evidence should be admitted if it was relevant to an appeal on a question of law.

To decide whether the evidence as to primary facts could support an appeal on a question of law, the judges gave an extended discussion of the review of fact finding in administrative law at [36]-[66], concluding that ‘the time has now come to accept that a mistake of fact giving rise to unfairness is a separate head of challenge in an appeal on a point of law’ [66]. But not just any error of fact will lead to unfairness. The judges held as follows concerning unfairness:

‘Without seeking to lay down a precise code, the ordinary requirements for a finding of unfairness are…. First, there must have been a mistake as to an existing fact, including a mistake as to the availability of evidence on a particular matter. Secondly, the fact or evidence must have been "established", in the sense that it was uncontentious and objectively verifiable. Thirdly, the appellant (or his advisers) must not been have been responsible for the mistake. Fourthly, the mistake must have played a material (not necessarily decisive) part in the tribunal's reasoning.’ [66]