Challenge to Haringey Development Vehicle rejected


Re: Peters v London Borough of Haringey & Anor [2018] EWHC 192 (Admin)

The claimant sought to challenge the Haringey Development Vehicle (HDV), the purpose of which was to create a partnership between Haringey London Borough Council and the private sector, to bring private sector finance, experience and expertise to the task of developing the Council’s land for its better use.
The grounds of challenge were that the Council (1) could not use a Limited Liability Partnership for these purposes since the Council was acting for a commercial purpose under the Localism Act 2011, s1 and so had to use a limited company; (2) had failed in its statutory duty of consultation under the Local Government Act 1999, s3; (3) had failed in its public sector equality duty under Equality Act 2010 s149; and (4) could only take this decision in full Council and not by Cabinet alone, by virtue of the Local Authorities (Functions and Responsibilities) (England) Regulations 2000 SI No.2853, rule 4(1)(b).

In regards to the first ground Ouseley J held that the “Council’s purpose in entering into the arrangements setting up the HDV and governing its operation, including the relationship between the two partners, cannot be characterised as  “a commercial purpose” within the scope of the Localism Act. Even more clearly its dominant purpose (which the court held to be what mattered) was not commercial”.  Any commercial component was merely incidental or ancillary, and not a separate purpose.

The Court refused permission to argue the second ground because, although the Council should have consulted (and had failed to do so), that should have happened in 2015 so the challenge now was out of time. On the public sector equality duty Ouseley J ruled that if the duty were breached at any stage, he was “wholly satisfied that compliance would not have made the slightest difference to the decisions”. Permission was refused in relation to the last ground on the basis that it was not ‘realistically arguable” – this was a decision to be taken by the Cabinet, not by the Full Council.

David Wolfe QC was involved in this case.