Jason Varuhas: Remedial Reform Part 1: Rationale

This is the first of two posts on the remedial reforms proposed in the Judicial Review and Courts Bill. If passed, the reforms will make statutory provision for courts in judicial review proceedings to grant suspended and prospective-only quashing orders. 

This post considers the general case for reform. It argues that the reforms can play a vital role in reaffirming remedial discretion on judicial review, and providing a much-needed framework of principle to guide remedial decision-making. The post argues against the so-called ‘presumption’, and explains why statutory provision for suspended and prospective relief is required despite there being precedent supporting availability of such relief at common law. Finally the post notes the latest twist in the remedies saga: the Supreme Court’s very recent decisions in Majera and TN.

Part 2 will focus more closely on suspended and prospective orders, explaining the normative justification for such relief and analysing discretionary factors relevant to grant of these orders.

The prompt for remedial reform: reiterating remedial discretion

The reforms are highly significant, and to be welcomed, because they make clear that courts on judicial review have a choice as to the remedial consequences that follow from a finding of unlawfulness. Specifically the reforms make clear that a court may choose between (i) voidness ab initio/nullity, which involves immediately voiding an impugned act with retrospective effect; (ii) suspended quashing, which postpones nullification to a future date; and (iii) prospective quashing, which involves removing or limiting any retrospective effect of nullification. Exercise of this remedial discretion is to be guided by enumerated factors. 

In providing for this framework the reforms reassert and reiterate the traditional remedial discretion on review, and that remedial consequences should be the product of reasoned deliberation in light of relevant considerations. As such, the reforms effectuate IRAL’s preferred view of remedies: ‘[t]he better route … is to give courts the freedom to decide whether or not to treat an unlawful exercise of power as having been null and void ab initio’ ([3.64]).

The reforms are prompted by a series of Supreme Court decisions over the last decade, including Ahmed (2010), UNISON (2017), and Miller II (2019), in which the Court has asserted that legal errors, or certain types of error, invariably lead to nullity. 

This is striking as these cases have features which would ordinarily lead not only to consideration of remedial discretion, but exercise of that discretion to avoid or mitigate the consequences of nullity. For example in UNISON an entire system of tribunal fees was struck down with retrospective effect. There was no consideration of the fact that retrospective invalidation would result in a legal black hole, likely cause huge administrative instability, that it would take time for government to promulgate a new scheme, and that government would be exposed to significant restitutionary liability. 

Yet it is clear that courts have wide discretion to modulate the remedial consequences of a finding of unlawfulness as recognised by IRAL – remedies are ‘fundamentally discretionary’ ([3.60]) – and the Supreme Court itself in other cases: Walton (2012); Champion (2015) [55]-[61]; Youssef (2016) [61]; Moseley (2014) [33]. This discretion can be exercised to refuse relief entirely (Argyll (1986) 774-775; Hurley (2012) [99]), there is scope to impose terms and conditions and allow for variation of relief (ClientEarth (2015) [35]; Fishermen (2017) [53]) – and there is authority for prospective-only and suspended invalidation, as discussed below. Indeed, Lord Carnwath has suggested that had he sat in Unison he might have called for submissions on the possibility of suspending invalidation to allow time for the consequences of the judgment to be worked out and to promote certainty, until a new acceptable scheme were put in place ([2021] JR 321, [43]). 

Even leading scholars who normatively favour a strict approach to remedial consequences such as Forsyth acknowledge that albeit unlawfulness may generally lead to nullity, that consequence can be negatived or modulated through discretion: Wade and Forsyth, Administrative Law, 11 ed (OUP) 249-250. And even judges who have made strong statements that it will be a rare case where discretion is exercised to withhold relief nevertheless accept there is such discretion: Berkeley (2001) 608, 616. This is supported by judicial practice: ‘there are plenty of examples of cases’ where unlawfulness ‘does not lead to an ineluctable conclusion’ of nullity (IRAL [3.60]).

There are good reasons for remedial flexibility. Remedial discretion provides an outlet for courts to consider the ramifications of remedial outcomes. A consequence such as nullity may cause serious prejudice to vital public interests and third parties, cause administrative upheaval, and undermine certainty and finality. Along with other discretions built into the machinery of review, such as those going to permission, standing, disclosure and oral evidence, remedial discretion ‘may be important in maintaining the overall balance of public interest in appropriate cases’ (Walton [103]). 

Of course, nullification of unlawful action serves to strongly uphold the principle of government under law, and the normative force of legal constraints. But this is not the only way to vindicate legality; for example, suspended quashing would uphold the rule of law, as such orders will be premised on an explicit finding of unlawfulness and the impugned act would ultimately be voided. In any case legality is not the only game in town. Review would soon lose its legitimacy if it were dogmatically focused on legality to the exclusion of all other interests or became detached from ordinary practicalities. 

And herein lies the problem with the line of Supreme Court decisions which treat voidness ab initio as automatic and inevitable. The approach inexplicably ignores remedial discretion. And it is a blunt approach which makes no allowance for the practical consequences of invalidation for important public and other interests.

In UnisonMiller II and EU (Legal Continuity) Bill (2018) the Court sought to rest remedial consequences on an asserted distinction between legal errors going to the scope of power, and legal errors going to exercise of power. The distinction seemingly contradicts the post-Anisminic idea of a single category of legal errors. Indeed one could be forgiven for thinking that the distinction is a re-animated version of the distinction between jurisdictional and non-jurisdictional errors, which Anisminic is taken to have interred. That distinction was laid to rest for good reason: it was wholly uncertain and easily manipulable. The scope/exercise distinction has the same problems. In cases such as Unison and Miller II the legal error is presented as one of scope, resulting in nullity. But in both cases the Court’s whole inquiry revolved around the qualities of the given exercise of powers – in Miller II the Court asked whether the Prime Minister’s advice had a reasonable justification and in Unison the Court asked whether the fees regime was a proportionate interference with access to tribunals (Varuhas [2020] 79 CLJ 578, 606-613). The mode of legal inquiry smacks of substantive review – which according to the Court goes to exercise of power – but the Court semantically framed the given errors as going to scope, so that nullity indubitably followed. 

In any case, the distinction does not suggest a rational basis for organising remedies. An error categorised as going to scope could be very minor or technical, yet it would inevitably lead to nullity, notwithstanding the practical consequences of such an outcome. Whereas unlawfulness going to exercise could involve patent unreasonableness, yet voidness would not automatically follow. 

The better approach is one based in the court’s longstanding remedial discretion, as envisioned by the Bill and IRAL. Review remedies should be determined on the basis of good reasons, not manipulation of an uncertain conceptual division of questionable normative significance. As Lord Carnwath observed in Privacy International (2019) [128]-[132], a ‘flexible’, ‘pragmatic and principled’ approach is to be preferred to ‘elusive concepts [such] as jurisdiction (wide or narrow), ultra vires, or nullity’.

The reforms reinforce flexibility by providing that courts have discretion whether to suspend the consequence of nullity, and to modulate any retrospective effects of nullity. The Bill also provides for relief to be given on terms (subs 2). By providing explicitly for discretionary factors (subs 8) the Bill reiterates that remedies ought to rest on reasoned decision-making calibrated to the facts of the case, which accounts for important interests such as good administration. This framework will ensure consistency of principle, and militate against remedial principles being reinvented from one case to the next. The transparent articulation of factors and the imperative that these factors ‘must’ be taken into account militates against cherry-picking of factors; a court must work through the prescribed factors. The statement of factors affords fair warning to litigants, in a clear and transparent way, as to those concerns that will shape remedial decision-making. 

Importantly, this framework can provide a more general and much needed blueprint for a coherent and consistent approach to judicial review remedies, helping to bring order to an unruly remedial jurisprudence. While remedial decision-making in fields such as equity is characterised by well-known and well-defined discretionary principles, which provide reasonable certainty and predictability, the judicial review case law on remedies is chaotic. This is partly due to the field being characterised by conflicting statements of principle, and thus the lack of a clear and consistently-applied framework. And it is in part due to a general judicial neglect of remedies. Remedial consequences are typically addressed in a few sentences at the end of a judgment, or not addressed at all. In terms of remedial discretion, one must go back to the 1980s and decisions such as Argyll to find serious attempts to articulate a framework of principle. 

Some argue remedial flexibility will encourage courts to expand the grounds of review, in the knowledge they can modulate the consequences of unlawfulness through discretion. But it is clear the courts already have remedial discretion. The problem is that the Supreme Court has completely ignored its discretion. And yet the Court has significantly expanded the grounds of review anyway, including in ways that challenge the supervisory conception of review (see my submission to IRAL). 

As such the reforms could play a fundamental role in reasserting remedial discretion as an important counter-balance to the expansionary phase of judicial legal development over the last few years (see IRAL [3.50]). The Supreme Court has over the last year taken steps to rein in some of the excesses of the preceding era, including by kyboshing the structural unfairness doctrine (see the A (2021) case). However, the end of that doctrine does not mark the end of systemic review, nor the capacity of courts to strike down entire administrative systems. These features of review in particular require a more nuanced, flexible approach to remedies, given the potentially significant consequences of invalidating entire schemes. Abstract systemic review under the Unison access to courts doctrine persists (despite that doctrine being liable to the same criticisms levelled at structural unfairness by the Court in A), as does the Gillick doctrine (which the Court in A said could have provided an alternative basis for impugning systems in many of the structural unfairness cases). Variants of the principle of legality, which incorporate proportionality, also enable courts to strike down regulations and policies on substantive grounds, absent deference (Varuhas [2020] 79 CLJ 578). 

The presumption

Let us next consider the presumption in subs 9 of the Bill. Much has been said on this topic. So let me very briefly elaborate why the foregoing discussion of remedial flexibility suggests the presumption should be deleted. First of all, the presumption is so weak as to be meaningless: it applies unless there is ‘good reason’ for it not to apply. And yet its inclusion could very well subvert the premise of reform – which is to reiterate remedial flexibility, and thus that remedial decisions should be based on reasoned analysis of all relevant factors implicated on the facts. Instead of such approach the effect of subs 9 could be that litigants and courts start with and fixate on the tests in that clause, specifically the touchstone of ‘adequate redress’, to the exclusion of other factors, such as the public interest. ‘Adequate redress’ could in practice become the ultimate test for relief. Consider: how likely is it that a court will grant suspended or prospective relief when it has concluded such relief is inadequate? More generally a presumption makes little sense given the leitmotif of reform is flexibility. As the Bill’s explanatory note states: ‘The diverse circumstances of possible cases make it difficult to assume that any one remedy or combination of remedies would be most appropriate in all circumstances’ ([21]).

Suspended and prospective orders 

The Bill explicitly confers on courts powers to grant suspended and prospective quashing orders. A suspended order postpones nullification of an impugned administrative act until a future date, while a prospective order limits or removes any retrospective effect of nullification. Two points may be made in regard to these orders: first, there is authority supporting such relief; but second, reform is necessary to make clear such relief is available and that, if given, such orders shall be effective. The normative justification for suspended and prospective relief shall be addressed in Part 2.

First, neither remedy is novel. 

Prospective nullification is known to the common law. Within the much-debated void/voidable division – which was thought by some to map on to the old division between jurisdictional and non-jurisdictional errors – where an unlawful administrative act was merely voidable, and the court exercised its power to void the act, that consequence would only operate prospectively, so anything that had been done pursuant to the impugned act would ‘remain good’ (eg Peachey [1966] QB 380, 402-403; Head [1959] AC 83, 111-112). In terms of more recent jurisprudence, it would seem the corollary of the Supreme Court holding that errors going to scope are automatically void ab initio, is that errors going to exercise are voidable. Thus, the reforms, in providing for prospective-only relief, do not introduce a foreign concept, but rather make the choice between nullity and prospective-only quashing depend on reasoned consideration of relevant factors, rather than dubious conceptual distinctions. And indeed at common law there is precedent for reviewing courts utilising remedial discretion to limit retrospective effects. Lord Phillips in Mossell (2010) said: ‘There may be occasions when declarations of invalidity are made prospectively only or are made for the benefit of some but not others’ ([44]; British Academy (2015) [12]-[21]). Tellingly, this passage is quoted with apparent approval in the recent Supreme Court decision in Majera ([31], and see [37]-[42]), noted below. Prospective-only relief has also been a characteristic feature of the remedial approach in judicial review of market regulation: Datafin [1987] QB 815; ArgyllGuinness [1990] 1 QB 146.

There is less authority in relation to suspended orders, but there is authority nonetheless. Peachey concerned a challenge to the legality of a valuation list. A majority of the Court of Appeal considered that if the list were unlawful, the defendant should be mandated to produce a new list. In addition the majority considered it was within the court’s discretion to hold that the old list, if unlawful, would remain valid while the new list was developed, and quashed upon adoption of the new list. Thus, ‘certiorari could be postponed’. This was a case where Lord Denning MR saw any legal error as rendering the list voidable rather than void ab initio, but it seems Danckwerts LJ considered legal error would render the list a nullity – and still he considered suspension possible. Either way, the case demonstrates that the idea of suspended quashing is not completely foreign to the common law. And indeed there is now statutory precedent in s 102 of the Scotland Act 1998. Interestingly, there are also instances where mandamus and prohibition have been suspended: Harrower [1970] 1 WLR 1424; Blackburn [1976] 1 WLR 550. And there are examples of suspended nullification in comparative jurisprudence. Australian courts have held administrative action will be set aside by a given date if certain steps are not taken by the defendant (Project Blue Sky (1990) 363), and there are examples of courts effectively suspending nullification by temporarily staying the court’s orders (Brouwer (2007) [95]).

Peachey also demonstrates that suspended and prospective-only quashing should not necessarily be seen as alternatives. Lord Denning considered certiorari could be suspended, to afford government time to formulate a new list, and that when the old list was ultimately invalidated, this would operate prospectively only, to avoid chaos that would otherwise be caused by retrospective invalidation. A similar approach was taken in the Privy Council case of Fishermen, which similarly to Unison involved an unlawful system of fees. The Board ordered the defendant to promulgate a new fees-system and the Board’s orders were without prejudice to the validity of anything done or fees collected under the unlawful scheme, and to its continued operation until the new scheme took effect ([53]). Thus, the remedial package involved both suspended and prospective-only invalidation. 

These examples are pertinent because as presently drafted subs 1(a) of the Bill may suggest suspended and prospective relief are alternatives, given the use of ‘or’ at the end of that clause. Given it is not the Government’s intention to so limit remedial flexibility (explanatory note at [86], [89]) an amendment may be needed to make crystal clear that the remedies may be used cumulatively.

Second, despite there being precedent supporting both suspended and prospective-only quashing, the reforms are necessary to put beyond doubt that such remedies are (i) available; and (ii) effective. 

In terms of (i) the reforms are necessitated by recent Supreme Court decisions presenting nullity as an inevitable consequence which the courts are powerless to avert. Subs 1, by providing for suspended and prospective quashing, along with subs 8 which enumerates the discretionary factors, reasserts that there is discretionary choice as to remedial outcomes. 

In terms of (ii) subs 3-5 make clear that suspended quashing orders will be effective to suspend invalidation, and that prospective orders will be effective in limiting or removing any retrospective effects of nullification. These provisions are important given the reasoning in cases such as Ahmed, which suggests that where an administrative act is a nullity, a quashing order is irrelevant because there is not and never was an administrative act to be quashed – the impugned act never existed in law (for an example of ongoing uncertainty in relation to suspended relief see: D4 (2021)). The Bill responds to such reasoning by providing that in the case of a suspended order the impugned administrative act will be ‘upheld’ – that is, treated as valid and unimpaired by the given legal defect – until the date prescribed in the order. The Bill thus renders such orders effective to suspend invalidation. The Bill similarly provides that where an order removes or limits any retrospective effect of nullification, the impugned act shall be upheld to the extent the retrospective effect of quashing is removed or limited.

The latest twist

Let us conclude by noting the latest twist in the remedies saga. A week and a half ago the Supreme Court gave judgment in Majera. The case signals a striking change of direction. Lord Reed, in extended obiter remarks, stressed that unlawfulness does not necessarily result in nullity, that the practical consequences of remedial choices require a flexible approach which accounts for important public interests, and that discretion may be used to modulate the effects of nullity. Majera follows TN, decided in September. TN can be seen as an acknowledgement by the Court of the need for remedial nuance specifically in the context of systemic review. In that case the Court tailored its remedial approach to ensure that systemic review did not undermine important public interests, holding that albeit an entire administrative scheme may be invalid for systemic unfairness, it does not follow that individual decisions made under that scheme are automatically nullified; to hold otherwise would undermine certainty and finality, given the large class of decisions made under the impugned system. 

The Court’s apparent turn away from the strictures of the approach that has characterised its jurisprudence over the last decade and recognition of the importance of discretion serves to reinforce the case for a remedial scheme that institutionalises remedial flexibility in a systematic way. The reforms will provide an endorsement of this changed approach and ensure it ‘sticks’, equip the courts with the remedial tools necessary to effectuate such approach, and enact a concrete framework for the principled development of the Court’s jurisprudence along this new, promising trajectory.

Jason N E Varuhas, Professor of Law, Melbourne Law School.

(Suggested citation: J. N.E. Varuhas, ‘Remedial Reform Part 1: Rationale’, U.K. Const. L. Blog (3 November 2021) (available at https://ukconstitutionallaw.org/))