Inland Revenue Commissioners and National Federation of Self-Employed and Small Businesses Ltd  2 All ER 93
LORD WILBERFORCE:..... The proceedings have been brought by the procedure now called 'judicial review'. There are two claims: the first for a declaration that the Board of Inland Revenue 'acted unlawfully' in granting an amnesty to the casual workers; the second for an order of mandamus to assess and collect income tax from the casual workers according to the law. These two claims rest, for present purposes, on the same basis, since a declaration is merely an alternative kind of relief which can only be given if, apart from convenience, the case would have been one for mandamus.
In RSC Ord 53, dating from 1977, which introduced the simplified remedies by way of judicial review it is laid down in r 3(5) that:
The Court shall not grant leave unless it considers that the applicant has a sufficient interest in the matter to which the application relates.
The issue which comes before us is presented as one related solely to the question whether the federation has the 'sufficient interest' required.
In the Divisional Court, when the motion for judicial review came before it, the point as to locus standi was treated as a preliminary point. "Before we embark on the case itself," said Lord Widgery CJ, "we have to decide whether the federation has power to bring it at all" (see  2 All ER 378 at 382,  STC 261 at 265). After hearing argument, the court decided that it had not. The matter went to the Court of Appeal ( 2 All ER 378,  QB 407,  STC 261), and again argument was concentrated on the preliminary point, though it, and the judgments, did range over the merits. The Court of Appeal by majority reversed the Divisional Court and made a declaration that "the [federation] have a sufficient interest to apply for Judicial Review". On final appeal to this House, the two sides concurred in stating that the only ground for decision was whether the federation has such sufficient interest.
I think that it is unfortunate that this course has been taken. There may be simple cases in which it can be seen at the earliest stage that the person applying for judicial review has no interest at all, or no sufficient interest to support the application; then it would be quite correct at the threshold to refuse him leave to apply. The right to do so is an important safeguard against the courts being flooded and public bodies harassed by irresponsible applications. But in other cases this will not be so. In these it will be necessary to consider the powers or the duties in law of those against whom the relief is asked, the position of the applicant in relation to those powers or duties, and the breach of those said to have been committed. In other words, the question of sufficient interest cannot, in such cases, be considered in the abstract, or as an isolated point: it must be taken together with the legal and factual context. The rule requires sufficient interest in the matter to which the application relates. This, in the present case, necessarily involves the whole question of the duties of the Inland Revenue and the breaches or failure of those duties of which the federation complains.
Before proceeding to consideration of these matters, something more needs to be said about the threshold requirement of 'sufficient interest'. The courts in exercising the power to grant prerogative writs, or since 1938 prerogative orders, have always reserved the right to be satisfied that the applicant had some genuine locus standi to appear before it. This they expressed in different ways. Sometimes it was said, usually in relation to certiorari, that the applicant must be a person aggrieved, or have a particular grievance (see R v Thames Magistrates' Court, ex parte Greenbaum (1957) 55 LGR 129); usually in relation to mandamus, that he must have a specific legal right (see R v Guardians of Lewisham Union  1 QB 498, R v Russell  3 All ER 695,  1 QB 342); sometimes that he must have a sufficient interest (see R v Cotham  1 QB 802 (mandamus), Ex parte Stott  1 KB 7 (certiorari)). By 1977 when RSC Ord 53 was introduced the courts, guided by Lord Parker CJ, in cases where mandamus was sought, were moving away from the Lewisham Union test of specific legal right to one of sufficient interest.
In R v Russell Lord Parker CJ had tentatively adhered to the test of legal specific right, but in R v Customs and Excise Comrs, ex parte Cooke and Stevenson  1 All ER 1068,  1 WLR 450 he had moved to sufficient interest. Shortly afterward the new rule (RSC Ord 53, r 3) was drafted with these words.
RSC Ord 53 was, it is well known, introduced to simplify the procedure of applying for the relief formerly given by prerogative writ or order, so the old technical rules no longer apply. So far as the substantive law is concerned, this remained unchanged; the Administration of Justice (Miscellaneous Provisions) Act 1938 preserved the jurisdiction existing before the Act, and the same preservation is contemplated by legislation now pending. The Order, furthermore, did not remove the requirement to show locus standi. On the contrary, in r 3 it stated this in the form of a threshold requirement to be found by the court. For all cases the test is expressed as one of sufficient interest in the matter to which the application relates. As to this I would state two negative propositions. First, it does not remove the whole, and vitally important, question of locus standi into the realm of pure discretion. The matter is one for decision, a mixed decision of fact and law, which the court must decide on legal principles. Second, the fact that the same words are used to cover all the forms of remedy allowed by the rule does not mean that the test is the same in all cases. When Lord Parker CJ said that in cases of mandamus 'the test may well be stricter' (sc than in certiorari) (see R v Russell  3 All ER 695 at 697,  1 QB 342 at 348 and in R v Customs and Excise Comrs, ex parte Cooke and Stevenson  1 All ER 1068 at 1072,  1 WLR 450 at 455 'on a very strict basis'), he was not stating a technical rule, which can now be discarded, but a rule of common sense, reflecting the different character of the relief asked for. It would seem obvious enough that the interest of a person seeking to compel an authority to carry out a duty is different from that of a person complaining that a judicial or administrative body has, to his detriment, exceeded its powers. Whether one calls for a stricter rule than the other may be a linguistic point; they are certainly different and we should be unwise in our enthusiasm for liberation from procedural fetters to discard reasoned authorities which illustrate this. It is hardly necessary to add that recognition of the value of guiding authorities does not mean that the process of judicial review must stand still....
[I]t is clear that the Commissioners of Inland Revenue are not immune from the process of judicial review. They are an administrative body with statutory duties, which the courts, in principle, can supervise. They have indeed done so: see R v Income Tax Special Comrs (1888) 21 QB 313, [1886(90] All ER Rep 1139 (mandamus) and cf Income Tax Special Comrs v Linsleys (Established 1894) Ltd  1 All ER 343,  AC 569, where it was not doubted that a mandamus could be issued if the facts had been right. It must follow from these cases and from principle that a taxpayer would not be excluded from seeking judicial review if he could show that the Revenue had either failed in their statutory duty toward him or had been guilty of some action which was an abuse of their powers or outside their powers altogether. Such a collateral attack, as contrasted with a direct appeal on law to the courts, would no doubt be rare, but the possibility certainly exists.
The position of other taxpayers, other than the taxpayers whose assessment is in question, and their right to challenge the Revenue's assessment or non-assessment of that taxpayer, must be judged according to whether, consistently with the legislation, they can be considered as having sufficient interest to complain of what has been done or omitted. I proceed thereto to examine the Revenue's duties in that light.
These duties are expressed in very general terms and it is necessary to take account also of the framework of the income tax legislation. This establishes that the commissioners must assess each individual taxpayer in relation to his circumstances. Such assessments and all information regarding taxpayers' affairs are strictly confidential. There is no list or record of assessments which can be inspected by other taxpayers. Nor is there any common fund of the produce of income tax in which income taxpayers as a whole can be said to have any interest. The produce of income tax, together with that of other inland revenue taxes, is paid into the Consolidated Fund which is at the disposal of Parliament for any purposes that Parliament thinks fit.
The position of taxpayers is therefore very different from that of ratepayers. As explained in Arsenal Football Club Ltd v Ende  2 All ER 267,  AC 1, the amount of rates assessed on ratepayers is ascertainable by the public through the valuation list. The produce of rates goes into a common fund applicable for the benefit of the ratepayers. Thus any ratepayer has an interest, direct and sufficient, in the rates levied on other ratepayers; for this reason, his right as a 'person aggrieved' to challenge assessments on them has long been recognised and is so now in the General Rate Act 1967, s 69. This right was given effect to in Ende's case.
The structure of the legislation relating to income tax, on the other hand, makes clear that no corresponding right is intended to be conferred on taxpayers. Not only is there no express or implied provision in the legislation on which such a right could be claimed, but to allow it would be subversive of the whole system, which involves that the commissioners' duties are to the Crown, and that matters relating to income tax are between the commissioners and the taxpayer concerned. No other person is given any right to make proposals about the tax payable by any individual; he cannot even inquire as to such tax. The total confidentiality of assessments and of negotiations between individuals and the Revenue is a vital element in the working of the system. As a matter of general principle I would hold that one taxpayer has no sufficient interest in asking the court to investigate the tax affairs of another taxpayer or to complain that the latter has been underassessed or overassessed; indeed there is a strong public interest that he should not. And this principle applies equally to groups of taxpayers: an aggregate of individuals each of whom has no interest cannot of itself have an interest.
That a case can never arise in which the acts or abstentions of the Revenue can be brought before the court I am certainly not prepared to assert, nor that, in a case of sufficient gravity, the court might not be able to hold that another taxpayer or other taxpayers could challenge them. Whether this situation has been reached or not must depend on an examination, on evidence, of what breach of duty or illegality is alleged. ...
On the evidence as a whole, I fail to see how any court considering it as such and not confining its attention to an abstract question of locus standi could avoid reaching the conclusion that the Inland Revenue, through Mr Hoadley, were acting in this matter genuinely in the care and management of the taxes, under the powers entrusted to them. This has no resemblance to any kind of case where the court ought, at the instance of a taxpayer, to intervene. To do so would involve permitting a taxpayer or a group of taxpayers to call in question the exercise of management powers and involve the court itself in a management exercise. Judicial review under any of its headings does not extend into this area. Finally, if as I think, the case against the Revenue does not, on the evidence, leave the ground, no court, in my opinion, would consider ordering discovery against the Revenue in the hope of eliciting some impropriety. Looking at the matter as a whole, I am of opinion that the Divisional Court, while justified on the ex parte application in granting leave, ought, having regard to the nature of 'the matter' raised, to have held that the federation had shown no sufficient interest in that matter to justify its application for relief. I would therefore allow the appeal and order that the originating motion be dismissed.
LORD DIPLOCK:....Before the new Ord 53 was substituted for its predecessor, the private citizen who sought redress against a person or authority for acting unlawfully or ultra vires in the purported exercise of statutory powers had to choose from a number of different procedures that which was the most appropriate to furnish him the redress that he sought. The major differences in procedure, including locus standi to apply for the relief sought, were between the remedies by way of declaration or injunction obtainable by a civil action brought to enforce public law and the remedies by way of the prerogative orders of mandamus, prohibition or certiorari which lay in public law alone; but even between the three public law remedies there were minor procedural differences, and the locus standi to apply for them was not quite the same for each, although the divergences were in process of diminishing.
Your Lordships can take judicial notice of the fact that the main purpose of the new Ord 53 was to sweep away these procedural differences including, in particular, differences as to locus standi, to substitute for them a single simplified procedure for obtaining all forms of relief, and to leave to the court a wide discretion as to what interlocutory directions, including orders for discovery, were appropriate to the particular case.....
My Lords, the expression 'person aggrieved' is of common occurrence in statutes and, in its various statutory contexts, has been the subject of considerable judicial exegesis. In the past, however, it had also sometimes been used by judges to describe those persons who had locus standi to apply for the former prerogative writs or, since 1938, prerogative orders. It was on this somewhat frail ground that it was argued that the distinction drawn in the Arsenal Football Club case between Mr Ende's grievance as a ratepayer and his grievance as a taxpayer was relevant to the question whether the federation as representing taxpayers was entitled to locus standi in the instant case. However this may have been before the new Ord 53 was made, the draftsman of that order avoided using the expression 'a person aggrieved', although it lay ready to his hand. He chose instead to get away from any formula that might be thought to have acquired, through judicial exposition, a particular meaning as a term of legal art. The expression that he used in r 3(5) had cropped up sporadically in judgments relating to prerogative writs and orders and consisted of ordinary English words which, on the face of them, leave to the court an unfettered discretion to decide what in its own good judgment it considers to be 'a sufficient interest' on the part of an applicant in the particular circumstances of the case before it. For my part I would not strain to give them any narrower meaning.
The procedure under the new Ord 53 involves two stages: (1) the application for leave to apply for judicial review, and (2) if leave is granted, the hearing of the application itself. The former, or 'threshold', stage is regulated by r 3. The application for leave to apply for judicial review is made initially ex parte, but may be adjourned for the persons or bodies against whom relief is sought to be represented. This did not happen in the instant case. Rule 3(5) specifically requires the court to consider at this stage whether 'it considers that the applicant has a sufficient interest in the matter to which the application relates'. So this is a 'threshold' question in the sense that the court must direct its mind to it and form a prima facie view about it on the material that is available at the first stage. The prima facie view so formed, if favourable to the applicant, may alter on further consideration in the light of further evidence that may be before the court at the second stage the hearing of the application for judicial review itself.
The need for leave to start proceedings for remedies in public law is not new. It applied previously to applications for prerogative orders, though not to civil actions for injunctions or declarations. Its purpose is to prevent the time of the court being wasted by busybodies with misguided or trivial complaints of administrative error, and to remove the uncertainty in which public officers and authorities might be left whether they could safely proceed with administrative action while proceedings for judicial review of it were actually pending even though misconceived.
My Lords, I understand that all your Lordships are agreed that, on the material that was before the Divisional Court on the ex parte application by the federation for leave to apply for judicial review of the so-called 'amnesty' extended to the Fleet Street casuals, the court was justified in exercising its discretion in favour of granting the leave sought. The only evidence that was before the court was the affidavit of Mr Payne, the contents of which have been summarised by my noble and learned friend Lord Wilberforce. It made out a prima facie case, albeit a somewhat flimsy one, that the Revenue had differentiated between three classes of defaulting taxpayers, (1) the Fleet Street casuals, all of whom were members of powerful trade unions, (2) owners of small businesses, who were not members of trade unions and on whose behalf the federation purported to be acting, and (3) perhaps more significantly, self-employed workers in the construction industry, popularly referred to as 'the lump', to whom powerful trade unions were bitterly opposed. In the absence of any other explanation, the leniency with which tax defaulters in the first class had been treated as contrasted with the severity with which those in the two latter classes were pursued gave rise, it was suggested by the federation, to reasonable suspicion that the Revenue had granted the amnesty not for any reasons of good management but simply in response to trade union pressure.
The complaint made by the federation was not preferential treatment of individual taxpayers but of all taxpayers falling within a particular class comprising 4,000 to 5,000 members whose unpaid taxes, recovery of which up to April 1977 was to be abandoned, were of the order of (1m a year. Consideration of the federation's complaint would not involve any departure from the Board's statutory duty to preserve the confidentiality of information obtained by their inspectors and collectors about individual taxpayers' affairs, since ex hypothesi the members of this class of taxpayers had made no returns and had not provided any information about their affairs.
My Lords, at the threshold stage, for the federation to make out a prima facie case of reasonable suspicion that the Board in showing a discriminatory leniency to a substantial class of taxpayers had done so for ulterior reasons extraneous to good management, and thereby deprived the national exchequer of considerable sums of money, constituted what was in my view reason enough for the Divisional Court to consider that the federation, or, for that matter, any taxpayer, had a sufficient interest to apply to have the question whether the Board were acting ultra vires reviewed by the court. The whole purpose of requiring that leave should first be obtained to make the application for judicial review would be defeated if the court were to go into the matter in any depth at that stage. If, on a quick perusal of the material then available, the court thinks that it discloses what might on further consideration turn out to be an arguable case in favour of granting to the applicant the relief claimed, it ought, in the exercise of a judicial discretion, to give him leave to apply for that relief. The discretion that the court is exercising at this stage is not the same as that which it is called on to exercise when all the evidence is in and the matter has been fully argued at the hearing of the application.
The analysis to which, on the invitation of the Lord Advocate for the Crown, the relevant legislation has been subjected by some of your Lordships, and particularly the requirement of confidentiality which would be broken if one taxpayer could complain that another taxpayer was being treated by the Revenue more favourably than himself, means that occasions will be very rare on which an individual taxpayer (or pressure group of taxpayers) will be able to show a sufficient interest to justify an application for judicial review of the way in which the Revenue have dealt with the tax affairs of any taxpayer other than the applicant himself.
Rare though they may be, however, if, in the instant case, what at the threshold stage was suspicion only had been proved at the hearing of the application for judicial review to have been true in fact (instead of being utterly destroyed), I would have held that this was a matter in which the federation had a sufficient interest in obtaining an appropriate order, whether by way of declaration or mandamus, to require performance by the Board of statutory duties which for reasons shown to be ultra vires they were failing to perform.
It would, in my view, be a grave lacuna in our system of public law if a pressure group, like the federation, or even a single public spirited taxpayer, were prevented by outdated technical rules of locus standi from bringing the matter to the attention of the court to vindicate the rule of law and get the unlawful conduct stopped. The Attorney General, although he occasionally applies for prerogative orders against public authorities that do not form part of central government, in practice never does so against government departments. It is not, in my view, a sufficient answer to say that judicial review of the actions of officers or departments of central government is unnecessary because they are accountable to Parliament for the way in which they carry out their functions. They are accountable to Parliament for what they do so far as regards efficiency and policy, and of that Parliament is the only judge; they are responsible to a court of justice for the lawfulness of what they do, and of that the court is the only judge.
I would allow this appeal on the ground on which, in my view, the Divisional Court should have dismissed it when the application came to be heard, instead of singling out the lack of a sufficient interest on the part of the federation, viz that the federation completely failed to show any conduct by the Board that was ultra vires or unlawful.
LORD FRASER OF TULLYBELTON: My Lords, I agree with all my noble and learned friends that this appeal should be allowed...but I wish to explain my reasons in my own words.
The application by the federation in the appeal for judicial review under RSC Ord 53 was refused by the Divisional Court on the ground that the applicants did not have a 'sufficient interest' in the matter to which the application related, as required by r 3 of that order. The decision of the Divisional Court was reversed by the Court of Appeal, by majority. Some of my noble and learned friends who heard the appeal consider that the appeal should be allowed and the application refused on the wider ground that it has no prospect of success on the merits. I agree that it does not, because the relief sought is a judicial review in the form of a declaration that the Revenue 'acted unlawfully' and an order of mandamus that they assess and collect income tax 'according to the law', but for the reasons explained by my noble and learned friend Lord Wilberforce it is clear that the Revenue did not act unlawfully. So the application cannot succeed on its merits.
But the question whether the federation has a sufficient interest to make the application at all is a separate, and logically prior, question which has to be answered affirmatively before any question on the merits arises. Refusal of the application on its merits therefore implies that the prior question has been answered affirmatively. I recognise that in some cases, perhaps in many, it may be impracticable to decide whether an applicant has a sufficient interest or not, without having evidence from both parties as to the matter to which the application relates, and that, in such cases, the court before whom the matter comes in the first instance cannot refuse leave to the applicant at the ex parte stage, under r 3(5). The court which grants leave at that stage will do so on the footing that it makes a provisional finding of sufficient interest, subject to revisal later on, and it is therefore not necessarily to be criticised merely because the final decision is that the applicant did not have sufficient interest. But where, after seeing the evidence of both parties, the proper conclusion is that the applicant did not have a sufficient interest to make the application, the decision ought to be made on that ground. The present appeal is, in my view, such a case and I would therefore dismiss the appeal on that ground. When it is also shown, as in this case, that the application would fail on its merits, it is desirable for that to be stated by the court which first considers the matter in order to avoid unnecessary appeals on the preliminary point.
The rules of court give no guidance as to what is a sufficient interest for this purpose. I respectfully accept from my noble and learned friends who are so much more familiar than I am with the history of the prerogative orders that little assistance as to the sufficiency of the interest can be derived from the older cases. But while the standard of sufficiency has been relaxed in recent years, the need to have an interest has remained and the fact that r 3 of Ord 53 requires a sufficient interest undoubtedly shows that not every applicant is entitled to judicial review as of right.
The new Ord 53, introduced in 1977, no doubt had the effect of removing technical and procedural differences between the prerogative orders, and of introducing a remedy by way of declaration or injunction in suitable cases, but I do not think it can have had the effect of throwing over all the older law and of leaving the grant of judicial review in the uncontrolled discretion of the court. On what principle, then, is the sufficiency of interest to be judged? All are agreed that a direct financial or legal interest is not now required, and that the requirement of a legal specific interest laid down in R v Guardians of Lewisham Union  1 QB 498 is no longer applicable. There is also general agreement that a mere busybody does not have a sufficient interest. The difficulty is, in between those extremes, to distinguish between the desire of the busybody to interfere in other people's affairs and the interest of the person affected by or having a reasonable concern with the matter to which the application relates. In the present case that matter is an alleged failure by the Revenue to perform the duty imposed on them by statute.
The correct approach in such a case is, in my opinion, to look at the statute under which the duty arises, and to see whether it gives any express or implied right to persons in the position of the applicant to complain of the alleged unlawful act or omission. On that approach it is easy to see that a ratepayer would have a sufficient interest to complain of unlawfulness by the authorities responsible for collecting the rates. Even if the General Rate Act 1967 had not expressly given him a right to propose alteration in the valuation list if he is aggrieved by any entry therein, he would have an interest in the accuracy of the list which is the basis for allocating the total burden of rates between himself and other ratepayers in the area. The list is public and is open for inspection by any person. The position of the taxpayer is entirely different. The figures on which other taxpayers have been assessed are not normally within his knowledge and the Commissioners of Inland Revenue and their officials are obliged to keep these matters strictly confidential: see the Inland Revenue Regulation Act 1890, ss 1(1) and 39 and the Taxes Management Act 1970, ss 1 and 6 and Sch 1. The distinction between a ratepayer and a taxpayer that was drawn in Arsenal Football Club Ltd v Ende  2 All ER 267,  AC 1 for the purposes of defining a person aggrieved under the General Rate Act 1967 is also relevant to the present matter.
The federation is a body with some 50,000 members, but its counsel conceded, rightly in my opinion, that if it had a sufficient interest to obtain judicial review, then any individual taxpayer, or at least any payer of income tax, must also have such an interest. I can see no justification for treating payers of income tax as having any separate interest in the matter now complained of from that of persons who pay other taxes. All taxpayers contribute to the general fund of revenue and the sense of grievance which the federation claims to feel because of the difference between the Revenue's treatment of the Fleet Street casuals and their treatment of private traders might be felt just as strongly by any honest taxpayer who pays the full amount of taxes of any kind to which he is properly liable. But if the class of persons with a sufficient interest is to include all taxpayers it must include practically every individual in the country who has his own income, because there must be few individuals, however frugal their requirements, who do not pay some indirect taxes including value added tax. It would, I think, be extravagant to suggest that every taxpayer who believes that the Inland Revenue or the Commissioners of Customs and Excise are giving an unlawful preference to another taxpayer, and who feels aggrieved thereby, has a sufficient interest to obtain judicial review under Ord 53. It may be that, if he was relying on some exceptionally grave or widespread illegality, he could succeed in establishing a sufficient interest, but such cases would be very rare indeed and this is not one of them.
For these reasons I would allow the appeal on the ground that the federation has no sufficient interest in the matters complained of.