On 18 October 2010 the High Court ruled that the decision of the UK Border Agency (UKBA) to revoke the tier 4 sponsor licence of London Reading College was unlawful.

The college had sought an order that the decision, if found to be unlawful, be quashed and it also sought substantial damages under section 8 of the Human Rights Act 1998. As a result of UKBA's decision to revoke its licence, London Reading College had suffered considerably; being forced to cease teaching, refund its pupils, lay off staff and vacate its premises.

Counsel for the claimant argued successfully that the revocation of the licence breached the requirements of procedural fairness. This was because UKBA had not given the claimant the opportunity to comment on the ultimate reason for revocation (namely that it had not carried out accurate testing of English language skills). That reason was very different to the concerns which UKBA had previously put to the claimant for them to comment on during the course of its investigation (that it did not have compliant records and procedures in place in relation to monitoring and attendance). The claimant's position was that it did carry out compliant English language testing and would have been able to provide evidence of this had UKBA raised this concern with the claimant before revoking the licence.

Counsel for the claimant also successfully argued that the unlawful revocation of the licence breached Article 1 of the First Protocol ECHR. Specifically the court found that the sponsor licence was a 'possession' and that any decision therefore to deprive the claimant of the licence had to be made in accordance with the law and had to be proportionate.

The court quashed the decision to revoke the licence and a further hearing on the assessment of damages under section 8 of the HRA 1998 is pending.

This case provides the first indication from the judiciary that UKBA's actions in removing sponsor licences unlawfully may result in significant damages claims. In view of the significant financial losses which can occur when a sponsor's licence is revoked, we expect the Government to strongly resist damages claims and to vigorously defend itself in the further proceedings arising from this case.