UK: A Stone in the Shoe - Private Body or Public Authority?

Last Updated: 22 February 2007
Article by Nicholas Dobson

Since 2 October 2000 section 6(1) of the Human Rights Act has made it unlawful for public authorities to act incompatibly with a Convention right. That's clear enough for local and other specifically public authorities. But what of private authorities that conduct functions on behalf of public authorities? That's a bit more tricky as the caselaw in recent years has demonstrated, and section 6(3)(b) of the 1998 Act, 'public authority' includes (amongst other things) 'any person certain of whose functions are functions of a public nature'.

Poplar Housing

Way back in 2001, these issues were before the Court of Appeal in Poplar Housing and Regeneration Community Association Ltd. v Donoghue [2001] 4 ALL ER 604. There, in the context of housing possession proceedings, the court had to consider whether a housing association to which a substantial proportion of local authority's housing stock had been transferred was a public body or performing public functions. Lord Woolf CJ pointed out that:

'The purpose of s 6(3)(b) is to deal with hybrid bodies which have both public and private functions. It is not to make a body, which does not have responsibilities to the public, a public body merely because it performs acts on behalf of a public body which would constitute public functions were such acts to be performed by the public body itself. An act can remain of a private nature even though it is performed because another body is under a public duty to ensure that that act is performed.'

The Court (amongst other things) considered that:

'What can make an act, which would otherwise be private, public, is a feature or a combination of features which impose a public character or stamp on the act. Statutory authority for what is done can at least help to mark the act as being public; so can the extent of control over the function exercised by another body which is a public authority. The more closely the acts that could be of a private nature are enmeshed in the activities of a public body, the more likely they are to be public.However, the fact that the acts are supervised by a public regulatory body does not necessarily indicate that they are of a public nature.' (Emphases added)

In the circumstances the Court of Appeal in Donoghue found that:

'. . .while activities of housing associations need not involve the performance of public functions, in this case, in providing accommodation for the defendant and then seeking possession, the role of Poplar is so closely assimilated to that of Tower Hamlets that it was performing public and not private functions. Poplar therefore is a functional public authority, at least to that extent. We emphasise that this does not mean that all Poplar's functions are public. We do not even decide that the position would be the same if the defendant was a secure tenant. The activities of housing associations can be ambiguous. For example, their activities in raising private or public finance could be very different from those that are under consideration here. The raising of finance by Poplar could well be a private function.' (Emphases added).

Leonard Cheshire

More recently (in February and March 2002) the Leonard Cheshire case (R (Heather and others) v Leonard Cheshire Foundation and another [2002] EWCA Civ 366) laid down the current core foundation in this particular area. There the appellants were residents in an establishment (Le Court) owned and run by the Leonard Cheshire Foundation (LCF - a charitable company limited by guarantee). The appeal was against the dismissal of their application for judicial review of LCF's decision to close the home in its then form.

The local authority had a duty to the residents under section 21 of the National Assistance Act 1948 even though it used its powers under section 26 of that Act to engage LCF as a provider of the relevant care services. Amongst other things, section 21 is a duty to make arrangements for providing residential accommodation for persons aged eighteen or over who by reason of age, illness, disability or any other circumstances are in need of care and attention which is not otherwise available to them. Section 26 provides (amongst other things) that arrangements under section 21 of the 1948 Act may include arrangements made with a voluntary organisation or with any other person that is not a local authority where that organisation or person manages for reward premises which provide accommodation. In the circumstances the Court of Appeal (Lord Woolf CJ, Laws and Dyson LJJ) took the view that:

'LCF is not standing in the shoes of the local authorities. Section 26 of the NAA [National Assistance Act 1948] provides statutory authority for the actions of the local authorities but it provides LCF with no powers. LCF is not exercising statutory powers in performing functions for the appellants.' (Emphasis added).

Lord Woolf pointed out that:

'The fact that LCF is a large and flourishing organisation does not change the nature of its activities from private to public. (i) It is not in issue that it is possible for LCF to perform some public functions and some private functions. In this case it is contended that this was what has been happening in regard to those residents who are privately funded and those residents who are publicly funded. But in this case except for the resources needed to fund the residents of the different occupants of Le Court, there is no material distinction between the nature of the services LCF has provided for residents funded by a local authority and those provided to residents funded privately. While the degree of public funding of the activities of an otherwise private body is certainly relevant as to the nature of the functions performed, by itself it is not determinative of whether the functions are public or private. . .'

Also:

'There is no other evidence of there being a public flavour to the functions of LCF or LCF itself. LCF is not standing in the shoes of the local authorities. Section 26 of the 1948 Act provides statutory authority for the actions of the local authorities but it provides LCF with no powers. LCF is not exercising statutory powers in performing functions for the appellants. . . . On the approach adopted in Poplar Housing and Regeneration Community Association Ltd v Donoghue . . . it can be said that LCF is clearly not performing any public function'.

Network Rail

On 18 May 2006 Sir Michael Turner in the Queens Bench Division had to consider whether Network Rail Infrastructure Limited as the successor to Railtrack plc was a public authority and acting as such at the time of the Potters Bar train crash of 10 May 2002. The case in question was Cameron and others v Network Rail Infrastructure Limited [2006] EWHC 1133. This was to determine a claim for damages under the Human Rights Act 1998 by (amongst others) relatives of one of the deceased. The claim was on the basis of alleged breaches of Article 2 of the European Convention on Human Rights (right to life) and Article 8 (right to respect for private and family life). As the Court pointed out, it was a necessary incident of this and other claims in the proceedings that at the material time the Defendant (Network Rail Infrastructure Limited as the successor to Railtrack plc) was a public authority and acting as such at the time of the accident.

In the circumstances, the Court considered that at the material time there was a combination of factors to demonstrate that the Defendant was not 'a core public authority' and could not have been acting as such in respect of its maintenance functions. These factors included:

  • The fact that the primary purpose of the Railways Act 1993 was to take the railways out of the public sector and return the industry to private ownership from which it had been transferred under the Transport Act 1962.
  • The business of running a railway is not intrinsically an activity of government.
  • There was a clear commercial objective in the performance of Railtrack (the predecessor of Network Rail).
  • Railtrack was not democratically accountable to central or local government.
  • The board of directors of Railtrack was appointed by the Company and their appointment was not subject to government influence or control.
  • Railtrack possesses no special powers nor does it enjoy immunities which might have been indications of 'publicness' if they had existed.
  • The Company was not publicly funded.
  • Railtrack had no special powers beyond those resulting from those regulating relations between individuals.

Aston Cantlow

Aston Cantlow with Billesley PCC v Wallbank and another [2004] 1AC 546 (cited in Network Rail) concerned a parochial church council (PCC) a body corporate which formed part of the Church of England and whose functions included co-operating with the minister in promoting the Church's mission within the parish. The issue in question was whether the PCC was a public authority for the purposes of section 6 of the 1998 Act. The House of Lords held that it was not. As Lord Nicholls pointed out, the PCC:

'. . .plainly has nothing whatever to do with the process of either central or local government. It is not accountable to the general public for what it does. It receives no public funding, apart from occasional grants from English Heritage for the preservation of its historic buildings. In that respect it is in a position which is no different from that of any private individual.'

Also:

'. . .the phrase 'a public authority' in s 6(1) is essentially a reference to a body whose nature is governmental in a broad sense of that expression. It is in respect of organisations of this nature that the government is answerable under the convention. Hence, under the Human Rights Act a body of this nature is required to act compatibly with convention rights in everything it does. The most obvious examples are government departments, local authorities, the police and the armed forces. Behind the instinctive classification of these organisations as bodies whose nature is governmental lie factors such as the possession of special powers, democratic accountability, public funding in whole or in part, an obligation to act only in the public interest, and a statutory constitution'.

Johnson v Havering; YL v Birmingham

However, despite the extensive caselaw consideration of which the above are only a few instances, the issue remains a stone in the shoe that's not yet been managed to be shaken out. Bearing in mind the Court of Appeal precedent authority of Leonard Cheshire, this issue comes particularly into focus in relation to care home residents when, for example, a home decides to amend its operations to the detriment of those residents. This rose again on 30 January 2007 in the Court of Appeal in the two appeals in R (Johnson) v Havering London Borough Council; YL v Birmingham City Council and others [2007] EWCA Civ 26. However, this decision shouldn't be the last word since the issue of whether a private care home is a public authority in the relevant circumstances was given leave to be appealed to the Lords

Johnson - Alleged Loss of Rights a Breach of the Convention?

In the Johnson appeal Mrs. Johnson and other Claimants were residents in a care home maintained by the London Borough of Havering under the provisions of section 21 of the 1948 Act. They sought to prevent the transfer by the Council of the residents' and other care homes to private sector control as the Council was in principle authorised to do under section 26 of the 1948 Act.

A key contention of the Claimants was that by transferring them out of Council care into the hands of private carers, Havering would be removing or diminishing the Convention rights formerly guaranteed to the Claimants. Consequently, it was submitted, the Council would be failing to ensure real and effective protection of the Claimants' rights and so be acting incompatibly with the Convention and unlawfully under section 6 of the 1998 Act.

Amongst the rights argued to be lost in these circumstances was the protection of Article 8 (right to respect for private and family life). The arguments included the fact that the place of residence became home for the Claimant(s) in question and was therefore subject to 'core protection' under Article 8 including a right to be consulted about any proposal to alter the place of residence. On the assumption that a private care home is not a public authority under section 6 of the 1998 Act, it would not be subject to Article 8 and therefore that protection would be lost to the resident(s) in question.

However, in the view of the Court of Appeal there were two main objections to this argument. Firstly it assumed that the state has an obligation to provide (and having so provided to maintain) a particular level of Article 8 protection. However that assumption was considered to be faulty for two reasons. Firstly, since the Article 8 requirements are less stringent and manifestly less well-defined than the requirements of domestic law (e.g. under the Care Homes Act 2000) it would seem impossible to maintain that there is an Article 8 obligation to maintain a particular type or level of provision when discharging duties under section 21 of the 1948 Act. Moreover, even where Article 8 does place collateral obligations on the government in respect of the home it has provided in performance of its domestic law duties, there is no reason to think that those obligations have a fixed context and in particular no reason to think that a change in that context will necessarily entail a breach of Article 8.

In addition the resident would remain the responsibility of the local authority under section 21 of the 1948 Act which will continue to have Article 8 obligations to her as well as its obligations under section 21. That duty will compel the local authority to intervene and to offer resources and protection for the resident. Consequently since the local authority has to secure the resident's Convention rights it is just as vulnerable to suit as would be the residential home should those rights be infringed. Buxton LJ noted the observation of Lord Walker in M v Secretary of State for Work and Pensions [2006] 2 AC 91 that the interference with the citizen has to be of some seriousness before Article 8 is engaged. Whilst caution must be exercised before applying that insight as though it was a statutory rule, the approach nevertheless reinforced the conclusion of Buxton LJ in this case that the change in the residents' legal position that occurs when the homes are transferred from public to private control is insufficient to amount to a breach of the Convention.

YL - Is a Private Care Home a Public Authority?

In short the answer was no having regard to the previous Court of Appeal authority in Leonard Cheshire which remained intact following Aston Cantlow (see above). The Court of Appeal considered this issue in some detail following a submission by the Secretary of State that Leonard Cheshire was wrongly decided and could not stand with the subsequent decision of the House of Lords in Aston Cantlow. However, the Court of Appeal rejected this submission. As Buxton LJ indicated:

The general approach of this court was not falsified; and it is not open to us to differ from the way in which that approach was applied by the earlier court to facts that in all relevant respects are the same as the facts of our case.'

Key findings of the Court of Appeal in Johnson and YL

  1. There is no Article 8 obligation to maintain a particular type or level of provision when discharging duties under section 21.
  2. Even where Article 8 places collateral obligations in respect of the performance of an authority's domestic law duties there is no reason to think that those obligations have a fixed content and in particular no reason to think that a change in that content would necessarily entail a breach of Article 8.
  3. An authority continues to have Article 8 obligations in addition to its obligations under section 21 of the 1948 Act towards a resident placed in private residential care which would compel the local authority to intervene and offer resources and protection for the resident. Consequently, the change in a resident's legal position that occurs when homes are transferred from public to private control is insufficient to amount to a breach of the Convention.
  4. Given the Court of Appeal authority in Leonard Cheshire when accommodating residents under arrangements made with an authority under the 1948 Act, a private care home is not exercising a public function for the purposes of section 6(3)(b) of the 1998 Act.

Conclusion

However, as mentioned above, the issue has not gone away and the case will certainly not be the final word on it. For (other issues apart) the Court of Appeal gave permission to appeal to the House of Lords on the issue of whether the private homes are public authorities. Buxton LJ departed somewhat from convention (if not the Convention) in going on a private journey to work out what in his view would be the correct answer to the issue of whether a private care home was exercising public functions in the circumstances in question were the Court not bound by the Leonard Cheshire precedent. However, he was not able to give a definitive universal answer.

Buxton LJ noted the heavy de facto reliance upon public funds in relation to private care homes instanced on behalf of Birmingham City Council and observed that:

'. . . these care homes can only continue, whether as viable charities or as profitable businesses, because they are accepted by the public function as acceptable providers of a public obligation. That degree of close integration into, and dependence on, the work of local authorities in discharging their section 21 duties should be a strong indicator that the care of persons placed under section 26 is itself a "public" function.'

However, ultimately he was unable to give a positive answer as to whether the private care home would be a public authority under section 6(3)(b) of the 1998 Act. Nevertheless, he equally drew back from 'giving a negative answer that will be binding in all circumstances. And whether:

'. . . it is necessary to find that the care home is bound by any and if so which of the articles of the Convention must depend, first, on what would be legitimate relief in the "best interests" proceedings; and, second, on whether that relief can be provided without infringing any other Convention values.'

He recognised that this 'may be an unattractive invitation to further litigation' but feared:

'. . . that is the unavoidable outcome, however the courts proceed, once domestic enforcement of the Convention embraces the relativist values of articles 8-11; and once the bodies bound by those values pass from the core case of the national government to bodies with legitimate interests of their own to assert.'

Not hugely helpful it may be thought. It will be interesting to see what the Lords make of this issue once it gets onto their operating table.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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