Public Law Pitfalls for Academies – Part II

Inadequate Consultation & Other Public Law Pitfalls for Academies

In Part 1 of this post I outlined the public law pitfalls for academies when they exercise their public functions. One of the ways in which academy trusts can ensure they comply is to conduct a fair consultation process before taking major decisions with a public character..

 The crucial importance of consultation

The duty to consult before taking major decisions may be expressly required by specific legislation, such as section 5 of the Academies Act 2010 (where a school is proposing to convert), or Section 10 (where a free school is being proposed), or it may be implied as a matter of good administrative practice. Either way, the decision-maker will expose itself to risk of a claim for a flawed consultation process if it doesn’t follow the correct procedures.  As well as being a legal duty in itself, in some circumstances, the running of a consultation exercise may be seen as a way to improve transparency and enhance the quality of decision-making. Although it may be an administrative burden with some expense involved, it may help to fend off other types of challenges later because it will elicit information and relevant facts that the decision-maker needs to be aware of before proceeding, and will help to show that the decision maker made proper enquiries (for example, around the equalities impact of any proposals, such as the effects on ethnic minorities or disabled persons).

The sort of contentious proposals on which a consultation might be required include choosing or changing a sponsor, joining or leaving a Multi Academy Trust, changing admissions arrangements, changes to SEN provision, or opening a Sixth Form.

Golden rules for a fair and bullet-proof consultation

To avoid the risk of challenge to the consultation exercise itself, or to the subsequent decision which is based on it, the consultation must always be carried out fairly. What is fair will depend on the particular circumstances and the nature of the proposals under consideration. It will always be sensible for decision-makers to take more care if the proposals are likely to be very controversial. If the statute or Government guidance lays down specific requirements for the consultation, then these must be adhered to, but otherwise there will be a broad discretion to design the process as they see fit. The Courts have laid down the following key principles known as the Gunning principles

[1] (named after the claimant in that case), which must always be followed:

  • Consultation must take place when the proposal is still at a formative stage – the decision-maker cannot consult on a decision that has already been made – otherwise the outcome will have been pre-determined. The wording of section 5 of the Academies Act (the duty to consult before creating an academy) gave rise to controversy when anti-academy campaigners sought to argue that a consultation conducted by a Governing Body once the they had already applied to the Secretary of State for an academy order had effectively been pre-determined. Fortunately, the section makes clear that consultation can take place “before or after an Academy order, or an application for an Academy order”. However, the application for an academy order (which is a pre-condition to obtaining the £25k grant funding for set up costs) requires the school to confirm that the Governing Body has passed a resolution in favour of conversion – passing such a resolution before consultation has taken place could be problematic! The resolution may have to be carefully worded to state simply that the Governing Body has resolved to ‘explore the possibility of moving to academy status’. Controversially, the new Education and Adoption Act has removed the requirement to consult when the Secretary of State decides to make an order in relation to an ‘inadequate’ or ‘coasting’ school[2]. Careful choice of words in public meetings and written communications can also be very important. If the trust board is minded to pursue a particular option, it should take care to say that and talk in terms of what might happen if the decision goes ahead, and not give the impression that the issue is a fait accompli. If there is really only one viable option, the trust can state this and provide reasons as to why this is the case.
  • Sufficient reasons must be put forward for the proposal to allow for intelligent consideration and response. Consultees need to be made aware of the basis on which a proposal for consultation has been put forward. They need to be aware of the criteria which will be used in considering the proposals, and what factors will be considered decisive. Equally, the information in the consultation document must not be inaccurate or misleading so as to mislead consultees. It is particularly important when dealing with complex issues to provide access to sufficient background information to educate and inform consultees. The document should set out what is proposed, what the options are and why these changes are needed. In the case of new academy proposals, it would be prudent to provide information about the background to academies, their supposed benefits and governance arrangements, the extra money and resources which might be available, the extra risks and responsibilities involved, the impact on teachers, pupils and other staff, impact on other schools. Be upfront about the reasons for a proposal – in the current climate the driver for change will often be mainly financial – if that is the case say so – don’t be tempted to hide behind other more superficially palatable reasons, because that may risk the exercise being struck down as unlawful.
  • Adequate time must be given for consideration and response. Sometimes the statute may prescribe the time period, otherwise it may be left to the decision maker. If the decision maker has already adopted a documented policy on time periods, it will be expected to adhere to it, unless there are good reasons to depart from it. In the context of schools, a minimum of six weeks would be a reasonable time period, however at least some of the period should be during term time when parents, pupils and staff are on site. DfE Guidance on making significant changes to an existing academy trust[3] recommends a period of four weeks and the Admissions Code requires a minimum of six weeks for changes to admission arrangements. If the decision needs to be taken urgently, the Courts may be tolerant of a shorter time period – though less so if the circumstances are of the academy’s own making.
  • The product of the consultation must be conscientiously taken into account. If the decision maker does not properly consider the responses, then it can be accused of having already made up its mind or having failed to take into account a relevant consideration. The decision maker does not have to personally take into account every response – it can rely on a summary produced by officers, as long as it is comprehensive and accurate. It is important make sure there is a paper-trail showing that this was the case.

Who should be consulted?

A key question is to identify the audience of persons who should be consulted. The safest option would be to cast the net wide and, depending on the nature of the proposal, consult with parents, pupils, staff, other affected schools, (e.g. feeder primary schools), nurseries or children’s centres on site, any diocesan or religious authority for the school, FE colleges, local community, local Admissions Forum, representatives of key stakeholders such as the local authority, the EFA, Regional Schools Commissioners, authorised representatives of trade unions and professional bodies. The consultation document should set out the background to the proposals and ask a series of questions and invite consultees to make any other observations they may wish to include. The information should be readily available – post it on websites and make hard copies available to pick up at the school. Consider issuing press releases to local papers. Meetings should be held for parents, pupils and staff and questions recorded and published as part of FAQs document on the website for those that could not attend. Useful guidance about the conduct of public consultations has been published by the Cabinet Office.

What if the proposal changes?

Is the decision-maker required to re-consult if it wants to adjust its original proposals or if circumstances have changed since the consultation began? The Courts have taken the view that fresh consultation is only required where there is a “fundamental difference between the proposals consulted on and those which the consulting party subsequently wishes to adopt”[4]. A particular example of this might be if the site for a new or expanded school has not yet been identified at the time consultation takes place. The consultation can proceed with new information about site information being provided as it becomes available – although obviously it may then be necessary to extend the time for responses on that aspect.

Whilst there are as yet no reported cases of judicial review of governing bodies in respect of academy proposals (as opposed to admissions or SEN issues), solicitors’ letters threatening litigation and the attendant costs seems to have been enough to delay conversions at Tyndale School in Islington, where the objectors alleged that the governing body failed to carry out an assessment of the impact changing to academy status would have on the wider community, especially in terms of equalities – how it would affect people of different religions, gender and disabilities. A similar threat of proceedings against the governing body based on flawed consultation and inaccurate information being presented to parents also delayed conversion at Tidemill School in Deptford.  It is also noteworthy that the governing body’s failure to consult properly can later be used as grounds to attack the Secretary of State’s decision to approve academy arrangements (even though it is not actually her obligation). This was accepted by the Court in proceedings to challenge the academisation of Downhills School in Haringey[5] (although the challenge ultimately failed on the basis that the local authority had consistently failed to raise standards and there was a pressing need to intervene, the judge accepted an argument that, if a credible alternative strategy had been put forward by parents to improve the school whilst remaining under local authority control, the decision maker would have been obliged to consider it).

Final thoughts

The complex patchwork of legal rules and duties applying to academy trusts is derived from many sources – including education law, company law and charity law. Given the hybrid nature of academy trusts and their special status as private corporations delivering publicly funded services, amid the multiple layers of regulation, it easy for trustees and governors to overlook the public law pitfalls for academies, the most important of which is arguably the duty to properly consult before taking major decisions which affect the school and wider community. As wholesale academisation gathers momentum, we may see more use being made of public law challenges to check and hold to account the decision-making of academy trusts.

[1] R v Brent London Borough Council, ex parte Gunning, (1985) 84 LGR 168

[2] Section 8 of the Education and Adoption Act 2016

[3] Making Significant Changes to an Open Academy,  DfE 1 March 2016

[4] Silber J in R (Smith) v East Kent Hospital  NHS Trust 2002 EWHC 2640 45ff

[5] R (Moyse) v Secretary of State for Education  [2012] EWHC 2758 (Admin)

Mark Johnson is a highly experienced independent solicitor & chartered company secretary helping schools and academies with conversions, creation of MATs, legal and governance issues. We can help your academy to flourish. Find out more at elderflowerlegal.co.uk.

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Public Law Pitfalls for Academies

Inadequate Consultation & Other Public Law Pitfalls for Academies

Despite the rhetoric about autonomy, independence from state control and privatisation, academy trusts are still treated as quasi-public bodies for some purposes in the eyes of the law. Consequently, they are subject to various public law duties in the way they carry out their public functions. Unlike their specific duties derived from legislation such as the Academies Act 2010, Charities Act 2011 or Companies Act 2006, many of these duties are not written down in black and white. Instead, they are derived from principles of administrative law developed by the Courts over many decades. This lack of clarity means it can be difficult for trustees and governors to understand precisely what the law requires in this area. This is a developing area of the law in the context of academy trusts, particularly as the prospect of more enforced academisation polarises views and seems likely to encourage more protest and challenge to the activities of academy trusts. It is important that trustees and governors understand what the public law pitfalls for academies are to avoid falling into the traps. In this series of posts I will be examining what these duties are and how to stay compliant.

What is public law?

Public law is a body of long-established rules and principles used to check and challenge the decisions and policies of public and quasi-public bodies (such as housing associations or NHS trusts). The Courts have found that academy trusts are subject to public law because (a) they are carrying out functions of public nature (b) they derive their legal existence from statutory powers vested in the Secretary of State and (c) they are funded mainly from state resources. Consequently, their decisions and actions may be susceptible to judicial review in the Administrative Court. The courts will not intervene lightly in decisions of public and quasi-public bodies. Claims for judicial review follow a specific procedure – there is a strict time limit of 3 months from the date of decision being challenged (and the claimant must act promptly). The claimant must comply with the pre-action protocol before issuing a claim. He must obtain permission from the court to bring the claim. A judge will determine if there is an arguable case at a preliminary hearing, usually based on written evidence alone at this stage. If the court grants permission to proceed, the second stage of the proceedings will then go on to consider the merits of the claim. If the claim is successful the court can make various orders – it can strike down the public body’s decision, it can issue a declaration that the decision is wrong and require the decision-maker to re-consider the issue. Although pursuing a case is likely to require a budget of several thousand pounds, which can be a significant deterrent, legal aid may be available for certain types of claims if the claimant is in receipt of means-tested benefits, a very low income or is a child, and it is becoming increasingly common for well-organised action groups to crowd-fund their case. Litigants may also protect themselves against the risk of having to pay the winning side’s costs if they lose by applying for a Protective Costs Order.

Public law duties

Public bodies must act within their powers and in a fair and reasonable way when dealing with service users and the public. In the context of academies, that means duties towards parents, pupils staff and the wider community. Public bodies must reach fair, rational and reasonable decisions about the rights and entitlements of their service users. If they don’t comply, their decisions can be subject to complaints, challenges before regulators (such as OFSTED or OFQUAL) adjudicators (e.g. the Schools Adjudicator for admission issues), the Education Funding Agency and ultimately court claims for judicial review. Judicial review proceedings are a way of challenging the decisions of public bodies on the basis that the decision-making process adopted by them is so seriously flawed as to be unlawful.

The principle that academy trusts are subject to public law duties and that their decisions can be challenged by a claim for judicial review was established in a case concerning a challenge to the admission arrangements of a City Technology College (the precursors to academy trusts) in South East London in 1995

[1]. Admission arrangements at the Harris Academy in Crystal Palace were found to be capable of challenge by way of judicial review in a case in 2011.[2] Whilst it is clear that the education functions of an academy trust are amenable to judicial review, it is less clear whether its other functions, such as delivery of non-statutory services or decisions to enter into commercial contracts could be subject to review in this way. In a challenge to the decision of Camden Council to establish a new academy in 2009, the claimant Mrs Chandler argued that the decision to select a new academy sponsor should have been subject to an open competition.  Although the challenge failed on the merits, the Court of Appeal acknowledged that an ordinary citizen might, in appropriate cases, have a public law claim for failure of a public body to comply with the public procurement rules (which requires contracts to be advertised and open to competition)[3].

Sound decision-making is vital

In the context of academies, the decisions which have a public law aspect are likely to be taken by the academy trust board, or occasionally the Chief Executive or Executive Headteacher of a MAT, acting under delegated powers. The usual line of attack against decisions or actions by a public body is to allege one or more of the following defects in the decision:

  • Irrationality or unreasonableness– the decision is so outrageous or absurd that no reasonable person would have made it, or alternatively the decision-maker has failed to ask itself the right question, failed to make proper enquiry into the facts, has not taken into account relevant factors, or has taken into account irrelevant considerations. Linked to this is a growing doctrine of proportionality: the action taken by a public body must be appropriate, necessary, and not go beyond what is necessary to achieve the objective[4]. Heavy-handed decisions which deprive someone of a fundamental right are particularly susceptible to review under this principle.
  • Illegality – the decision-maker must understand the law which regulates them. A public body may have acted outside of its powers (known as ‘ultra vires’) – those powers may be set out in legislation or in the governing document (Articles of Association); the body has failed to comply with a duty set out in a particular statute e.g. the requirement to make SEN provision under the Children and Families Act 2014; the body has unlawfully fettered its discretion – e.g. by adopting a blanket policy on an issue without considering the merits of each individual case; the body has failed to provide adequate reasons for its decision; the decision maker has unlawfully delegated its decision-making to another party when it should have taken the decision itself (for example, an unlawful scheme of delegation).
  • Procedural impropriety – this a defect in the process of decision-making, which breaches the rules of fairness and natural justice: this could include bias from the decision-maker because of an obvious conflict of interest, failure to give someone a ‘fair hearing’ to put forward their arguments, acting inconsistently in two or more similar situations, breach of a legitimate expectation (express or implicit promises made to people, which the decision maker then goes back on; or failure to consult before making an important decision (see more on this later).
  • Breach of Human Rights – failure to respect the European Convention Rights brought into UK law by the Human Rights Act 1998. It has become increasingly common for these grounds to be added into a claim, such as the right not to be discriminated against, right to freedom of expression, right to education, right to private and family life. In this context, the courts often apply a proportionality test – i.e. they have to weigh up the interests of the wider community and the legitimate aims of the state as against the protection of an individual’s rights and interests.

All this points to the need to think about the public law implications of decisions, policies and major changes implemented by an academy trust to avoid public law pitfalls. Examples of the kind of issues which could become contentious include, changing admission arrangements, a decision to merge or amalgamate schools, changes to SEN provision, uniform policies, school meals arrangements.

An interesting question which has yet to come before the courts is whether parents and pupils might use judicial review proceedings to force an academy trust to comply with certain provisions in their Funding Agreement which might be capable of conferring rights on third parties (for example, Clause 2.10 which requires the academy to be ‘all ability and inclusive’, to make available places for children with SEN (Annex para 9), to provide free milk (2.16) and to provide minimum pension benefits for staff (2.7). During debates on the Academies Bill in 2010 the Minister Lord Hill said “I am happy to confirm that parents have always had the power to seek judicial review against either the academy trust for failing to follow its contractual obligations [under the Funding Agreement] or the Secretary of State for failing to ensure that the academy complies with its obligations under the Funding Agreement[5]”. We may in future see claims based on the premise that pupils and parents have a ‘legitimate expectation’ that the terms of the Funding Agreement will be complied with.

Next time we will consider the crucial importance of conducting a fair consultation process when considering new or significant changes to academy arrangements.

[1] R v Governors of Haberdashers’ Askes Hatcham College Trust ex parte T [1995] ELR 351

[2] R (Omotosho) v Harris Academy Crystal Palace 2011 EWHC 3350, per Singh J at para 6

[3] R (Chandler) v London Borough of Camden 2009 EWCA Civ 1011 at para 77

[4] See for example, Pham v Home Secretary [2015] UKSC 19, per Lord Mance at para 96.

[5] Hansard 7 July 2010 Vol 720

Mark Johnson is a highly experienced independent solicitor & chartered company secretary helping schools and academies with conversions, creation of MATs, legal and governance issues. We can help your academy to flourish. Find out more at elderflowerlegal.co.uk.

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