Council wins Court of Appeal battle over homelessness reviews and contracting out

Hertsmere Borough Council was within its powers when it contracted out its homelessness reviews and extended the provider’s contract, the Court of Appeal has ruled.

Appellant Gerald James argued that a county court recorder had been wrong to conclude that Hertsmere’s decision on the contract review was lawful due to ratification by the council leader and chief executive.

Mr James in November 2017 applied to Hertsmere as homeless. The council said he was not 'vulnerable' and was intentionally homeless and so it had no duty to house him.

He requested a review in February 2018, which took until August of that year to conclude the original decision stood, far longer than the 56 days permitted.

In James v Hertsmere Borough Council [2020] EWCA Civ 489 Lord Justice Peter Jackson said Hertsmere had contracted out its homelessness reviews to Residential Management Group initially for a year.

The contract’s preamble said: “RMG will carry out section 202 Housing Act 1996 reviews selected by Hertsmere quality and reviews team over a 12 month period.”

Mr James argued that the review decision was invalid because this wording meant that to fall within the terms of the contract, reviews must be carried out and completed within 12 months, while the council argued that reviews selected during the 12 month period must be carried out to completion and would be authorised even if that happened after the 12 months had expired.

He said Hertsmere’s decision to extend the contract in August 2018 was of no effect because it had not lawfully contracted out its homelessness review function, and that subsequent attempts to ratify it were also of no effect.

Peter Jackson LJ said in his ruling:”In my view, the recorder was right to find that, if ratification of the extension to the contract was required, the leader of the council validly performed it.

“The same conclusion applies in respect of the chief executive. There is nothing in the argument that they were ratifying an ultra vires act as the delivery of contracted out review decisions was squarely within the powers of the council.”

He added that Mr James’s arguments had failed to show “that the interests of justice would be served by preventing the remedying of a defect that had nothing to do with the merits of the matter and deprived the appellant of no genuine legal right, but rather of an adventitious advantage”.

The county court had jurisdiction to determine all the challenges made by Mr James to the lawfulness of the review decision - the rest of which were not pursued to appeal - and the review decision was lawfully made because it was commissioned during the review period, Peter Jackson LJ ruled.

If that conclusion were wrong, it was anyway validly ratified by the leader and chief executive, he said.

Mark Smulian