In Kelton (Claimant) v Wiltshire Council (Defendant) & (1) HPH Ltd (2) HAB Housing (Interested Parties)  EWHC 2853 (Admin) the High Court considered the issue of bias and quashed a planning decision on the grounds that a Councillor had a private interest in the decision that amounted to an appearance of potential bias.
1. KEY POINTS
- In applying the test for apparent bias the Court will assess the background facts from the perspective of a fair-minded and informed observer.
- Apparent bias can be found where a decision is plainly in the Councillor's interests, even where the relevant party is neither the planning applicant nor bound by legal agreement to the applicant.
- A Councillor is entitled to hold a general interest in a cause but must not participate in the meeting if his or her private interest is engaged.
The Claimant challenged the Defendant Authority's decision to grant outline planning permission for a housing scheme with an affordable housing element. A Councillor on the planning committee was the director of a Housing Association with an interest in the scheme.
The Claimant challenged the decision on the ground of bias, advancing three separate challenges:
- The Councillor was automatically disqualified for financial interest as a result of his directorship of the Housing Association;
- The Councillor had a pecuniary interest in the obtaining the planning permission which he was required to disclose under the Localism Act 2011; and
- The planning permission gave rise to apparent bias.
The Defendant sought to argue that the committee were alive to the potential for bias and had considered the matter carefully, hence the Councillor had declared at the meeting that he was a member of the Housing Association board. However, he did not withdraw from the meeting on the grounds that the Housing Association was not the applicant and that there was no formal agreement in place at that stage between the Housing Association and the applicant.
3. THE DECISION
The Claimant failed on the first two aspects of the bias challenge as the Councillor did not have a direct pecuniary interest: at the time of the decision the Housing Association had not yet tendered for the role. The Court found in favour of the Claimant on the challenge of apparent bias and quashed the Defendant's grant of planning permission.
The legal context
The Court confirmed that the matter would be assessed from the perspective of a fair-minded and informed observer with access to only such facts as might be ascertained by a member of the public. As a result the Court placed a strong emphasis on the appearance of the decision making process to 'the outside world.'
In keeping with earlier judgments in this area the Court stated that councillors are subject to the principle of apparent bias, subject to the important caveat that they are not in a judicial position and consequently are entitled to express views on planning issues.
Appearance of bias
The Court found that it was plainly in the interests of the Councillor and the Housing Association for the application to be approved. The Housing Association had committed time, resources and expertise to its relationship with the applicants (the landowner and a property developer) to an extent that suggested a serious interest in delivering the affordable housing part of the scheme. In particular the Court noted that:
- The Housing Association had expressed a clear interest in delivering the scheme by writing in support and attending the planning committee meeting.
- The Housing Association was identified as the potential affordable housing partner in the design documents appended to the application.
- The Housing Association was the only affordable housing provider to have expressed public support for the scheme.
These facts created the appearance that the Housing Association and the applicants were working closely together on the scheme. The Court held that the strength of this appearance was sufficient to find apparent bias, despite the fact that the Housing Association did not yet have a contract to provide the affordable housing.
4. COMMENT This case highlights the importance of ensuring that a decision making process is seen to be fair and impartial from the perspective of an external observer. The Court made clear that a fair-minded and informed observer would not be expected to 'appreciate the nuance' of the application process in the same manner as a participant, and that the assessment of possible bias must turn on the facts of each case. Therefore to avoid successful challenges public bodies should give careful thought to maintaining the appearance of fairness.
Councillors may be concerned by the ruling that apparent bias may be found even where the relevant party is neither the planning applicant nor bound by legal agreement to the applicant. However, the case also draws a useful distinction for councillors between general interests and private interests which may provide comfort to those parties with a mere general interest in the relevant cause.