Metropolitan Properties Co (F G C) Ltd v Lannon and Others  3 All ER 304
LORD DENNING MR: This case is brought to determine the rents of the flats in Oakwood Court, West Kensington. It is concerned particularly with three flats in a block built forty years ago, namely, Nos 31, 60A and 61, Oakwood Court. Once the rents of those three flats are determined they will form a guide in determining the rents, not only of the other flats in Oakwood Court, but also of numerous flats in the neighbourhood... The procedure for determining rents is laid down by the Rent Act 1965. The rent officer for the area first determines a fair rent. He is usually a valuer appointed by the local authority. If either party objects to his figure, he can appeal to the rent assessment committee.....
Oakwood Court... was bought by...one of the Freshwater Group of Companies...Soon after the Freshwater Group took over Oakwood Court they proposed to increase the rents of the flats. Some of the tenants applied to the rent officer to register a 'fair rent' under the Rent Act 1965.... The rent officer fixed what he thought were fair rents. The Freshwater Group appealed to the rent assessment committee. That committee made drastic reductions in the rents. They put the fair rent at figures which were far lower than the contractual rents, far lower than any of the experts stated, and lower, indeed, than the tenants themselves had offered. The tenants were, no doubt, much gratified by the result; but the Freshwater Group took the case to the Divisional Court...[They] made a complaint against the respondent, Mr John Lannon, the chairman of the assessment committee. They alleged that he was disqualified. He could not have given them, they said, an unbiased hearing. He was a solicitor living in another block of flats owned by the Freshwater Group... His father was the tenant and was in dispute with the Freshwater Group. The Freshwater Group say that the son was assisting and advising his father in that dispute....On that account the son, they said, ought not to have sat on the flats in Oakwood Court.....
The Hearing and the Decision. I have pointed out that, on Friday, 13 January 1967, Mr John Lannon assisted his father in writing that letter in his dispute with the Freshwater Group. Yet on Thursday, 19 January 1967, he sat as chairman of the rent assessment committee to hear an appeal by that very group. The hearing took three to four days. On 26 April 1967, the committee gave their written decision. Widgery J in the Divisional Court described it ( 1 All ER at p 358.) as a 'startling decision'. And so it was. The committee fixed the rents for Oakwood Court lower than anyone had submitted to them....
The Law. A man may be disqualified from sitting in a judicial capacity on one of two grounds. First, a 'direct pecuniary interest' in the subject-matter. Second, 'bias' in favour of one side or against the other. So far as 'pecuniary interest' is concerned, I agree with the Divisional Court that there is no evidence that Mr John Lannon had any direct pecuniary interest in the suit. He had no interest in any of the flats in Oakwood Court. The only possible interest was his father's interest in having the rent of 55, Regency Lodge reduced. It was put in this way: if the committee reduced the rents of Oakwood Court, those rents would be used as 'comparable' for Regency Lodge, and might influence their being put lower than they otherwise would be. Even if we identify the son's interest with the father's, I think that this is too remote. It is neither direct nor certain. It is indirect and uncertain.
So far as bias is concerned, it was acknowledged that there was no actual bias on the part of Mr Lannon, and no want of good faith. But it was said that there was, albeit unconscious, a real likelihood of bias. This is a matter on which the law is not altogether clear; but I start with the oft-repeated saying of Lord Hewart CJ in R v Sussex Justices, Ex p McCarthy ( All ER Rep 233 at p 234): "it is not merely of some importance, but of fundamental importance, that justice should both be done and be manifestly seen to be done".
In R v Barnsley County Borough Licensing Justices, Ex p Barnsley & District Licensed Victuallers' Assocn ( 2 All ER 703 at pp 714, 715), Devlin LJ appears to have limited that principle considerably, but I would stand by it. It brings home this point; in considering whether there was a real likelihood of bias, the court does not look at the mind of the justice himself or at the mind of the chairman of the tribunal, or whoever it may be, who sits in a judicial capacity. It does not look to see if there was a real likelihood that he would, or did, in fact favour one side at the expense of the other. The court looks at the impression which would be given to other people. Even if he was as impartial as could be, nevertheless, if right-minded persons would think that, in the circumstances, there was a real likelihood of bias on his part, then he should not sit. And if he does sit, his decision cannot stand....Nevertheless, there must appear to be a real likelihood of bias. Surmise or conjecture is not enough.... There must be circumstances from which a reasonable man would think it likely or probable that the justice, or chairman, as the case may be, would, or did, favour one side unfairly at the expense of the other. The court will not enquire whether he did, in fact, favour one side unfairly. Suffice it that reasonable people might think he did. The reason is plain enough. Justice must be rooted in confidence; and confidence is destroyed when right-minded people go away thinking: 'The judge was biased'.
Applying these principles, I ask myself: Ought Mr John Lannon to have sat? I think not. If he was himself a tenant in difference with his landlord about the rent of his flat, he clearly ought not to sit on a case against the selfsame landlord, also about the rent of a flat, albeit another flat. In this case he was not a tenant, but the son of a tenant; but that makes no difference. No reasonable man would draw any distinction between him and his father, seeing that he was living with him and assisting him with his case. Test it quite simply: if Mr John Lannon were to have asked any of his friends: 'I have been asked to preside in a case about the rents charged by the Freshwater Group of Comanies at Oakwood Court. But I am already assisting my father in his case against them, about the rent of his flat in Regency Lodge, where I am living with him. Do you think I can properly sit?' The answer of any of his good friends would surely have been: 'No, you should not sit. You are already acting, or as good as acting, against them. You should not, at the same time, sit in judgment on them'. No man can be an advocate for or against a party in one proceeding, and at the same time sit as a judge of that party in another proceeding. Everyone would agree that judge, or a barrister or solicitor (when he sits ad hoc as a member of a tribunal) should not sit on a case to which a near relative or a close friend is a party. So, also, a barrister or solicitor should not sit on a case to which one of his clients is a party; nor on a case where he is already acting against one of the parties. Inevitably people would think he would be biased.
I hold, therefore, that Mr John Lannon ought not to have sat on this rent assessment committee. The decision is voidable on that account and should be avoided.
EDMUND DAVIES LJ:....It cannot be made too clear that the landlords expressly disclaim actual bias in the chairman. But if counsel for the tribunal be right, what becomes of the principle whose fragrance endures despite its enshrinement in the excessively quoted words of Lord Hewart CJ in R v Sussex Justices, Ex p McCarthy ( All ER Rep 233 at p 234,  1 KB 256 at p 259.) that 'justice should both be done and be manifestly seen to be done'? As Professor Smith has written (Judicial Review Of Administrative Action, 1959, p 150):
"The courts have often quashed decisions on the strength of the reasonable suspicions of the party aggrieved, without having made any finding that a real likelihood of bias in fact existed",
but, after referring to R v Camborne Justices, the writer continues:
"In so far as the 'real likelihood' and 'reasonable suspicion' tests are inconsistent with each other, it is submitted that the former is to be preferred; the reviewing court should make an objective decision, on the basis of the whole evidence before it, whether there was a real likelihood that the inferior tribunal would be biased. That members of an independent tribunal are likely to have been biased is a serious allegation. The public interest will not be served by relaxing the conditions under which it may be successfully made".
Nor, in my judgment, will the public interest be served if, in the light of all the circumstances as they finally emerge, it appears to right-thinking people that there are solid grounds for suspecting that a member of the tribunal responsible for the decision may (however unconsciously) have been biased. But it must be conceded that the tide of judicial opinion is to some extent in favour of the professor. Thus, in Healy v Rauhina ( NZLR 945 at p 951.), Hutchinson J after reviewing the cases, said:
"The weight of authority now is that the test to be applied is that of real likelihood of bias, and that reasonable suspicion of bias is insufficient".
And in R v Barnsley County Borough Licensing Justices ( 2 All ER at pp 714, 715, referring to the dissenting judgment of Salmon J in the Divisional Court, Devlin LJ said:
"I am not quite sure what test Salmon J., applied. If he applied the test based on the principle, that justice should not only be done, but should manifestly be seen to be done, I think that he came to the right conclusion on that test. But, in my judgment it is not the test. We have not to inquire what impression might be left on the minds of the present applicants or on the minds of the public generally. We have to satisfy ourselves that there was a real likelihood of bias, and not merely satisfy ourselves that that was the sort of impression that might reasonably get abroad. The term 'real likelihood of bias' is not used, in my opinion, to import the principle in R. v. Sussex Justices, Ex p. McCarthy to which Salmon J., referred ( 2 All ER 635 at p 641). It is used to show that it is not necessary that actual bias should be proved. It is unnecessary to investigate the state of mind of each individual justice. Real likelihood depends on the impression which the court gets from the circumstances in which the justices were sitting. Do they give rise to a real likelihood that the justices might be biased? The court might come to the conclusion that there was such a likelihood without impugning the affidavit of a justice that he was not in fact biased. Bias is or may be an unconscious thing. The matter must be determined on the probabilities to be inferred from the circumstances in which the justices sat".
With profound respect to those who have propounded the 'real likelihood' test, I take the view that the requirement that justice must manifestly be done operates with undiminished force in cases where bias is alleged, and that any development of law which appears to emasculate that requirement should be strongly resisted. That the different tests, even when applied to the same facts, may lead to different results is illustrated by R v Barnsley County Borough Licensing Justices ( 2 All ER at pp 714, 715,  2 QB at p 187.) itself, as Devlin LJ made clear in the passage which I have quoted. But I cannot bring myself to hold that a decision may properly be allowed to stand even although there is reasonable suspicion of bias on the part of one or more member of the adjudicating body.
Adopting that approach in relation to the facts of the present case, the circumstances already adverted to by my lords are such that I regard it as most unfortunate that this particular chairman sat to try these appeals....