High Court Judgment: 6 March 1996

MISS MOUNTFIELD for MR J HOBSON and MR P STINCHCOMBE instructed by (Godlove Pearlman, Leeds) appeared on behalf of the Applicants

MR R DRABBLE QC, MR ELVIN and MR J LITTON instructed by (The Treasury Solicitors) appeared on behalf of the Secretary of State for the Environment.

MR RYAN QC and MR J MILNER instructed by (Gordons, Wright & Wright, Bradford) appeared on behalf of William Morrison Supermarket Plc.

MR JUSTICE SEDLEY: This application for judicial review raises questions of some importance about the obligation of members of a statutory corporation to abstain from participation in the corporation's proceedings when matters arise in which they have a pecuniary or personal interest.

The urban development corporation

The corporation in question is the Leeds Development Corporation, which came into being by ministerial Order in June 1988, lost its powers in March 1995 and ceased to exist in July 1995. The power under which it was brought into being and functioned is to be found in Part XVI of the Local Government Planning and Land Act 1980. Within this Part, section 134 allows the Secretary of State, if 'of opinion that it is expedient in the national interest to do so', to designate any area of land as an urban development area. Section 135 then provides:

"(1) For the purposes of regenerating an urban development area, the Secretary of State shall by Order made by statutory instrument establish a corporation (an urban development corporation) for the area.

(4) An urban development corporation shall be a body corporate

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(6) It is hereby declared that an urban development corporation is not to be regarded as the servant or agent of the Crown or as enjoying any status, immunity or privilege of the Crown and that the corporation's property is not to be regarded as the property of, or property held on behalf of, the Crown."

The general powers of the Corporation were those set out in section 136:

"(1) The object of an urban development corporation shall be to secure the regeneration of its area.

(2) The object is to be achieved in particular by the following means (or by such of them as seem to the corporation to be appropriate to its area), namely, by bringing land and buildings into effective use, encouraging the development of existing and new industry and commerce, creating an attractive environment and ensuring that housing and social facilities are available to encourage people to live and work in the area."

The section goes on in sub-section (3) to empower an urban development corporation to hold land, provide services and conduct undertakings for its statutory purposes. It then provides:

"(6) To avoid doubt it is declared that sub- section (3) above relates only to the capacity of an urban development corporation as a statutory corporation; and nothing in this section authorises such a corporation to disregard any enactment or rule of law."

By the Leeds Development Corporation (Planning and Functions) Order 1988, in the exercise of power conferred by section 149, the Corporation became the local planning authority for all but strategic purposes in lieu of the local authority, Leeds City Council.

The Leeds Development Corporation (Transfer of Property Rights and Liabilities) Order 1995, by which the Corporation was wound up transferred its property, rights and liabilities to the Secretary of State for the Environment who, in consequence, appears by counsel not in his own right but as the legal successor to the Corporation. This brings the adventitious benefit that the submissions on behalf of the first respondent have been based upon the accumulated experience of the responsible Department of State.

Schedule 26 to the Act of 1980 makes provision for the composition and proceedings of UDCs. They are to have a chairman, a deputy chairman and between 5 and 11 members, all appointed by the Secretary of State. Paragraph 2(2) provides:

"In appointing members of the corporation the Secretary of State shall have regard to the desirability of securing the services of people having special knowledge of the locality in which the urban development area is or will be situated."

By paragraph 9 members may resign, and by paragraph 6 the Secretary of State may remove members from office on various grounds, including unsuitability to continue as a member. By paragraph 8, members are to be paid for their services. Under the cross-head 'Meetings and Proceedings' the schedule provides:

"13. The quorum of the corporation and the arrangements relating to its meetings shall, subject to any directions given by the Secretary of State, be such as the corporation may determine.

14. The validity of any proceeding of the corporation shall not be affected by any vacancy among its members or by any defect in the appointment of any of its members."

The applicant

This application is made by Mr John Hobson on behalf of Kirkstall Valley Campaign, a company limited by guarantee. It is opposed by Mr Richard Drabble QC on behalf of the Secretary of State for the Environment and by Mr Gerard Ryan QC on behalf of William Morrison Supermarket plc, which has bought the land to which the decisions now under challenge relate in the expectation of benefiting by the material consents. Following the grant of leave to move by Turner J on the 23rd October 1995, Dyson J refused the second respondent's application for an order that the applicant, being a limited company, give security for costs. Before me neither respondent has taken any point upon the locus of the applicant, and for my part I have no doubt that its capacity as a community action group concerned with the interests of local residents in the development of Kirkstall Valley gives it a sufficient interest in the subject matter of the application. I was, however, concerned to know whether the Campaign had incorporated itself purely for the purpose of litigation. This issue arose in R v Secretary of State for the Environment, ex parte Rose Theatre Trust Company [1990] 1 QB 504, where it emerged that the Company had been formed for the purpose of litigating; the point was met by the substitution of some of its individual members as applicants. In the present case I am told that the Campaign, in existence since 1988, was incorporated in November 1993 in order to be able to raise and hold funds. This being so, the problem which initially arose in the Rose Theatre case of a colourable incorporation for the sole apparent purpose of escaping the impact of a costs order does not arise here. For the rest, I have no doubt that the respondents were right not to question the sufficiency of the applicant's interest in the matters before the court.

Standards of conduct

The analogies between an urban development corporation and a local authority, as well as the important difference that the members of the one are appointed for specific purposes and of the other are elected for various purposes, are readily apparent. The Secretary of State, plainly recognising the potential for unanticipated conflicts of interest created in particular by paragraph 2(2) of schedule 26, has issued a succession of Codes of Conduct for the chairmen and board members of urban development corporations. The version which was sent to the chairman of the Leeds Development Corporation, Mr Peter Hartley, with his letter of appointment had been promulgated earlier in 1988. It contained the following paragraphs:

"Political Activities.

1. Chairmen and Board members should not serve as executive officers of a political party. This rule does not apply to chairmen and board members who are also members of local councils.

2. Subject to the above paragraph, chairmen and members including those who are members of local councils are free to engage in political activities provided:

(a) They are conscious of their general public responsibility;

(b) They exercise discretion, particularly in regard to the work of the Corporation;

(c) They do not make political speeches, or engage in other political activities on matters affecting the Corporation's work.

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4. Chairmen and Board members may maintain associations with trade bodies, trade unions, cooperative societies, etc. provided that such associations do not conflict with the Board's interests.

5. Any Chairman or Board member who is doubtful about the application of these rules, or about the propriety of any political activity, should seek guidance from the Secretary of State.

CONFLICTS OF INTEREST AND BUSINESS ACTIVITIES - BOARD MEMBERS.

6. Board members should avoid situations in which their duties and private interests conflict or where there could be a suspicion of conflict.

7. When members are appointed to the board they should declare to the board their private interests which are likely to give rise to conflict.

8. Cases where conflict of interests would be likely to arise including cases where any company or body in which a member has an interest:

a. In cases of land or property transactions with the UDC;

b. Seeks financial assistance from the UDC;

c. Seeks planning or other regulatory consent from the UDC;

d. Engages in consultancy to any commercial undertaking which has contracts with the UDC.

A conflict of interest will also arise if a member has an interest in a company or body which has entered into contractual arrangements with any other body which for the purposes of that contract or related contract is engaged in land or property transactions with the UDC, consultancy for the UDC, or is seeking financial assistance or planning or other regulatory consent from the UDC.

9. If a particular case gives rise to a possible conflict of interest for a board member, that member should write in advance to the board Chairman stating that he or she is a member, partner, or in the employment of a specific company or that there are other circumstances which could give rise to conflict.

10. Where a board member has declared an interest in accordance with the preceding paragraphs it is for the other members of the board to decide what action to take. Normally the board member should not take part in the consideration or discussion of the contract, planning application etc. or vote on it. if interest is remote and insignificant, and if the other members of the board so decide, the member may take part in the discussion and cast a vote.

11. Board members should inform the Secretary of State and the board Chairman of any new appointments which they propose to take up if those appointments might impinge on their duties as a member of the board.

12. The chairman should inform the Secretary of State where the board considers that a serious conflict has arisen or where it anticipates that such a conflict could arise.

CONFLICTS OF INTEREST AND BUSINESS ACTIVITIES - CHAIRMEN

13. With respect to conflicts of interest, chairmen are in a unique position, different from that of board members. They will therefore be asked to sign undertakings on their appointment which reflect their particular circumstances. For example, chairmen whose private interests include involvement with companies which might otherwise be expected to operate in the UDA, eg. construction or property companies, or consultancies, will normally be expected to sign at the outset an undertaking to the effect that these companies will not so operate during the term of the chairmen's appointment.

14. Chairmen should inform the Secretary of State of any change in their private interests from the time of their appointment which may give rise to conflicts of interest.

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CONFIDENTIAL AND PRIVATE INFORMATION

18. Chairmen and board members, through their duties, may acquire confidential or private information about the corporation or companies with which the corporation may be associated. It is a grave betrayal of trust for a present or retired chairman or board member to use such information for his or her personal advantage or the advantage of anyone known to him or her."

The code also dealt with grounds for removal, gifts and hospitality, travelling and subsistence expenses and the use of corporation facilities.

A version issued in February 1991 did not materially differ from its predecessor. A further version issued in January 1992, however, amended paragraph 10 (now renumbered 16) to read as follows (italics added):

"Where a board member has declared an interest in accordance with the preceding paragraph, it is for the chairman and other members of the board to decide how significant that interest is. In doing so the chairman of the board must seek the advice of its Accounting Officer and that advice must be formally recorded in the board minutes. If the conflict is considered significant, the board member should leave the room and not take part in any discussion of, or decision on the issue giving rise to the conflict. In the case of a meeting held in public, the member would not be required to leave the room, but should quite clearly take no part in the proceeding relating to the issue giving rise to the conflict. However, if the interest is remote or insignificant, and the chairman and the other board members so decide, then the member may participate in the discussion and the decision. In these circumstances it will be particularly important that a decision to allow the member's participation is formally recorded in the board minutes and can be referred to if any question is subsequently raised.'

Comparison may usefully be made between this guidance and the body of law and practice which governs conflicts of interest affecting members of local authorities. Under the cross-head 'Restrictions on voting' the Local Government Act 1972 provides:

"94(l). Subject to the provisions of section 97 below [removal of disability in certain circumstances], if a member of a local authority has any pecuniary interest, direct or indirect, in any contract, proposed contract or other matter, and is present at a meeting of the local authority at which the contract or other matter is the subject of consideration, he shall at the meeting and as soon as practicable after its commencement disclose the fact and shall not take part in the consideration of the discussion of the contract or other matter or vote on any question with respect to it."

The section goes on to make non-disclosure and participation in such circumstances a criminal offence. Section 95 defines a 'pecuniary interest' expansively, so as to include the interests of persons with whom the councillor has an equitable, professional or matrimonial relationship (other than with public bodies as defined by section 98(2)). Section 97, which deals with the removal of disabilities, provides by sub-section (5):

"For the purposes of section 94 above a member shall not be treated as having a pecuniary interest in any contract, proposed contract or other matter by reason only of an interest of his or of any company, body or person with which he is connected as mentioned in section 95(l) above which is so remote or insignificant that it cannot be reasonably regarded as likely to influence a member in consideration or discussion of, or in voting on, any question with respect to that contract or matter."

Sub-section (6) goes on to limit indirect pecuniary interests for the purpose in hand, so as to exclude beneficial interests in securities with a nominal value of £5,000 or less than 1% of the total issued share capital. Section 19 of the Local Government and Housing Act 1989 provides:

"(1) The Secretary of State may by regulation require each member of a local authority

(a) to give a general notice to the proper officer of the authority setting out such information about the member's direct and indirect pecuniary interests as may be prescribed by the regulations, or stating that he has no such interests and

(b) from time to time to give to that officer such further notices as may be prescribed for the purpose of enabling that officer to keep the information provided under the regulations up to date.

The section goes on to prescribe criminal penalties for non-compliance. To supplement it section 31 of the Act of 1989 permits the Secretary of State to issue 'for the guidance of members of local authorities' a National Code of Local Government Conduct, described in the Act as 'a code of recommended practice'. The Code, issued in 1990, includes the following paragraphs:

"l. Councillors hold office by virtue of the law, and must at all times act within the law. You should make sure that you are familiar with the rules of personal conduct which the law and standing orders requires, and the guidance contained in this Code. It is your responsibility to make sure that what you do complies with these requirements and this guidance. You should regularly review your personal circumstances with this in mind particularly when your circumstances change. You should not at any time advocate or encourage anything to the contrary. If in any doubt, seek advice from your council's appropriate senior officer or from your own legal adviser. In the end however, the decision and the responsibility are yours.

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5. If you have a private or personal interest in a question which councillors have to decide, you should never take any part in the decision, except in the special circumstances described below. Where such circumstances do permit you to participate, you should never let your interest influence the decision.

6. You should never do anything as a councillor which you could not justify to the public. Your conduct, and what the public believe about your conduct, will affect the reputation of your council, and of your party if you belong to one.

7. It is not enough to avoid actual impropriety. You should at all times avoid any occasion for suspicion and any appearance of improper conduct.

Disclosure of pecuniary and other interests

8. The law makes specific provision requiring you to disclose both direct and indirect pecuniary interests (including those of a spouse with whom you are living) which you may have in any matter coming before the council, a committee or a sub-committee. It prohibits you from speaking or voting on that matter. Your council's standing orders may also require you to withdraw from the meeting while the matter is discussed. You must also by law declare certain pecuniary interests in the statutory register kept for this purpose. These requirements must be scrupulously observed at all times.

9. Interests which are not pecuniary can be just as important. You should not allow the impression to be created that you are, or may be, using your position to promote a private or personal interest rather than forwarding the general public interest. Private and personal interests include those of your family and friends, as well as those arising through membership of, or association with, clubs, societies and other organisations such as the Freemasons, trade unions and voluntary bodies.

10. If you have a private or personal, non-pecuniary interest in a matter arising at a local authority meeting, you should always disclose it, unless it is insignificant, or one which you share with other members of the public generally as a ratepayers a community charge payer or an inhabitant of the area.

11. Where you have declared such a private or personal interest, you should decide whether it is clear and substantial. If it is not, then you may continue to take part in the discussion of the matter and may vote on it. If, however, it is a clear and substantial interest, then (except in the special circumstances described below) you should never take any further part in the proceedings, and should always withdraw from the meeting whilst the matter is being considered. In deciding whether such an interest is clear and substantial, you should ask yourself whether members of the public, knowing the facts of the situation, would reasonably think that you might be influenced by it. If you think so, you should regard the interest as clear and substantial

12. In the following circumstances, but only in these circumstances, it can still be appropriate to speak, and in some cases to vote, in spite of the fact that you have declared such a clear and substantial private or personal interest:

(a) if your interest arises in your capacity as a member of a public body, you may speak and vote on matters concerning that body; for this purpose, a public body is one where, under the law governing declarations of pecuniary interests, membership of the body would not constitute an indirect pecuniary interest;

(b) if your interest arises from being appointed by your local authority as their representative on the managing committee, or other governing body, of a charity, voluntary body or other organisation formed for a public purpose (and not for the personal benefit of the members) , you may speak and vote on matters concerning that Organisation;

(c) if your interest arises from being a member of the managing committee, or other governing body of such an organisation, but you were not appointed by your local authority as their representative, then you may speak on matters in which that organisation has an interest; you should not vote on any matter directly affecting the finances or property of that organisation, but you may vote on other matters in which the organisation has an interest;

(d) if your interest arises from being an ordinary member or supporter of such an organisation (and you are not a member of its managing committee or other governing body) , then you may speak and vote on any matter in which the organisation has an interest.

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Dispensations

18. If you decide that you should speak or vote, notwithstanding a clear and substantial personal or private non-pecuniary interest, you should say at the meeting, before the matter is considered, that you have taken such a decision, and why.

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Leadership and Chairmanship

22. You should not seek, or accept, the leadership of the council if you, or any body with which you are associated has a substantial financial interest in, or is closely related to, the business or affairs of the council. Likewise, you should not accept the chairmanship of a committee or subcommittee if you have a similar interest in the business of the committee or subcommittee.

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Use of confidential and private information

26. As a councillor or a committee or subcommittee member, you necessarily acquire much information that has not yet been made public and is still confidential. It is a betrayal of trust to breach such confidences. You should never disclose or use confidential information for the personal advantage of yourself or of anyone known to you, or to the disadvantage or the discredit of the council or anyone else."

Correspondingly, in the Model Standing Orders for Local Authorities (Ministry of Housing and Local Government, 1963, reprinted 1973) which the Department was good enough to produce at my request, Standing Order No 18, building upon the prohibition in section 76 of the Local Government Act 1933 of a member who has a direct or indirect pecuniary interest from taking part in any consideration of or vote upon a related question, requires such a member to withdraw from the meeting unless the disqualification has been lifted by the minister in the exercise of statutory powers, or the matter is the subject of report but not of debate, or the council as a body invites the member to remain. In the latter event, of course, an invitation to remain would not qualify the member to take part in discussion or voting.

The above provisions of the local government code, together with others which I have not quoted on gifts and hospitality, expenses and allowances, and the use of council facilities, make it reasonably clear that the Secretary of State, in drafting the Code for urban development corporation chairmen and members, has paid regard to his own National Code of Local Government Conduct; but he has omitted from the former elements of the latter which, as this case illustrates, might have been of value.

It is not a necessary part of this judgment to determine precisely how far the successive codes for urban development corporation members fall short of or exceed the requirements of the general law, although it will be necessary to touch on the question in the course of this judgment. I have canvassed with counsel whether there is in law a margin of appreciation within which members of urban development corporations, or the corporations themselves, may subject to ordinary public law constraints make up their own minds about conflicts of interest. Mr Hobson and Mr Drabble both submitted, and I accept, that the answer must be no. Although in the nature of things it will ordinarily be for members, with whatever advice is appropriate, to make up their own minds in the first instance, whether they have got it right will always be a question of law. Anything else, as Mr Drabble pointed out, would have the curious effect of making the individual a judge in his own cause on the question whether he was going to be judge in his own cause.

For historical reasons which are readily apparent, the codes all use the test of what a reasonable observer might think. Although the legal test is now known to be what the court itself makes of the risk of bias, there is nothing lost and much to be gained in terms of straightforward explanation if members of public bodies continue to ask themselves what a reasonable bystander would think rather than try to work out what a court would hold. The two ought to coincide, but the question which the contemporary bystander will be asking himself is not whether he suspects that the member may show favour or disfavour because of a personal or pecuniary interest, but whether there is a real danger that this will happen.

The law on bias

Although Mr Drabble in his submissions for the Secretary of State was content to accept Mr Hobson's governing proposition that the law on apparent bias is now to be found in unitary form in the decision of the House of Lords in R v Gough [1993] AC 646, as developed in R v Inner West London Coroner, ex parte Dallaglio (1994) 4 All ER 129, Mr Ryan has advanced a radical alternative: that non-judicial bodies such as an urban development corporation are governed by a different set of principles, to be found in a succession of cases beginning with the decision of Glidewell J in R v Sevenoaks District Council, ex parte Terry (1985) 3 All ER 226. If Mr Ryan is right, the question to be asked in relation to an impugned decision of a body such as the Leeds Development Corporation is not whether on the facts now known to the court there was a real danger of bias in one or more members of the decision-making body, but whether the body as a whole can be shown to have gone beyond mere predisposition in favour of a particular course and to have predetermined it. In order to see the full force of Mr Ryan's contention it is necessary first to consider the Gough case in the present statutory context.

R v Gough concerned the realisation by a juror, after a verdict had been returned, that the defendant's brother - who was now creating a disturbance in court - was her next door neighbour. Lord Goff of Chieveley, in the leading speech, considered in detail the authorities on apparent bias in the judicial context. He cited with approval the dictum of Blackburn J in R v Rand (1866) LR 1 QB 230, 232:

"'Any direct pecuniary interest, however small, in the subject of inquiry, does disqualify a person from acting as a judge in the matter."

He then turned to other instances where the interest of a member of the tribunal in the outcome of the proceedings, although falling short of a direct pecuniary interest, nevertheless disqualifies the member from participation in the decision and causes any decision taken in violation of the rule to be void. Starting from Blackburn J's dictum in R v Rand (at 233) that 'it would be very wrong ....... to act' where there was 'a real likelihood that the judge would, from kindred or any other cause, have a bias in favour of one of the parties', and upon the judgment of Devlin LJ in R v Barnsley Licensing Justices, ex parte Barnsley and District Victuallers' Association [1960] 2 QB 167, 187, Lord Goff went beyond the classic formulation of Lord Hewart CJ in R v Sussex Justices, ex parte McCarthy [1924] 1 KB 256 that 'justice should not only be done, but should manifestly and undoubtedly be seen to be done' and the corresponding decision, this time in relation to a rent assessment committee, of Lord Denning M.R. in Metropolitan Properties Company (FCG) Ltd. v Lannon [1969] 1 QB 577, and held that the single appropriate test was whether on the evidence there had been 'a real danger of bias'. The House also eliminated from the process of adjudication the imaginary reasonable man, recognising that in imputing to him all that is eventually known to the court and asking him for his impression, the court is looking into a mirror. Lord Goff concluded (at 670):

"I think it possible, and desirable, that the same test should be applicable in all cases of apparent bias, whether concerned with justices or members of other inferior tribunals, or with jurors or with arbitrators.......... Finally, for the avoidance of doubt, I prefer to state the test in terms of real danger rather than real likelihood, to ensure that the court is thinking in terms of possibility rather than probability of bias. Accordingly, having ascertained the relevant circumstances, the court should ask itself whether, having regard to the circumstances, there was a real danger of bias on the part of the relevant member of the tribunal in question, in the sense that he might unfairly regard (or have unfairly regarded) with favour, or disfavour, the case of a party to the issue under consideration by him; though, in a case concerned with bias on the part of a justices' clerk, the court should go on to consider whether the clerk has been invited to give the justices advice and, if so, whether it should infer that there was a real danger of the clerk's bias having infected the views of the justices adversely to the applicant."

The concluding passage, concerning justices, clerks, was based upon the House's approval of the decision of a divisional court in R v Camborne Justices, ex parte Pearce [1955] 1 QB 41 that it is not enough to demonstrate a real likelihood of bias on the part of a justices' clerk unless it is also shown that he was asked to give the justices his advice. In this event

"it is open to the court to infer that, having regard to the insidious nature of bias, there is a real likelihood of the clerk's bias infecting the views of the justices adversely to the applicant."

Lord Woolf, in an assenting speech with which Lord Goff expressed his agreement, made it clear that the House was not abandoning the maxim that justice must be seen to be done:

"When considering whether there is a real danger of injustice, the court gives effect to the maxim, but does so by examining all material available and giving its conclusion on that material."

Lord Woolf cited with approval from the Camborne Justices case the proposition that "any direct pecuniary or proprietary interest in the subject matter of a proceeding, however small, operates as an automatic disqualification. In such a case the law assumes bias."

This, he held, is the single established special (i.e. presumptive or automatic) category of disqualification; for the rest, a real danger of bias must be established and cannot be assumed. The Gough principle was amplified and applied to the case of a coroner in ex parte Dallaglio. In the leading judgment in the Court of Appeal, Simon Brown LJ set out nine propositions derived from Gough, of which the following are presently material:

"1. Any court seized of a challenge on the ground of apparent bias must ascertain the relevant circumstances and consider all the evidence for itself so as to reach its own conclusion on the facts.

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4. The question upon which the court must reach its own factual conclusion is this: is there a real danger of injustice having occurred as a result of bias? By 'real' is meant not without substance. A real danger clearly involves more than a minimal risk, less than a probability. One could, I think, as well speak of a real risk or a real possibility.

5. Injustice will have occurred as a result of bias 'if the decision-maker unfairly regarded with disfavour the case of a party to the issue under consideration by him'. I take 'unfairly regarded with disfavour' to mean 'was pre-disposed or prejudiced against one party's case for reasons unconnected with the merits of the issue'.

6. A decision-maker may have unfairly regarded with disfavour one party's case either consciously or unconsciously. Where, as here, the applicants expressly disavow any suggestion of actual bias, it seems to me that the court must necessarily be asking itself whether there is a real danger that the decision-maker was unconsciously biased.

7. It will be seen, therefore, that by the time the legal challenge comes to be resolved, the court is no longer concerned strictly with the appearance of bias but rather with establishing the possibility that there was actual although unconscious bias.

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9. It is not necessary for the applicants to demonstrate a real possibility that the coroner's decision would have been different but for bias; what must be established is the real danger of bias having affected the decision in the sense of having caused the decision-maker, albeit unconsciously, to weigh the competing contentions, and so decide the merits, unfairly."

A useful test, perhaps, can be adapted from the one used by counsel and adopted by Widgery J at first instance in the Lannon case [1967] 1 WLR 815,827: was the interest of the individual such as to create a real danger that he would instinctively oppose or favour one course rather than another?

Mr Hobson and Mr Drabble have based their contentions on the shared premise that these principles extend to the generality of decision-making bodies governed by the principles of public law, with the particular consequence that the participation of a single member with a disqualifying interest will vitiate the decision arrived at. They differ as to whether this has been the situation in the present case. Mr Ryan, however, differs from both of them as to whether the Gough test has any application at all in local government or in the analogous context of an urban development corporation. He begins by pointing out, correctly, that both Gough and Dallaglio concerned the performance of judicial functions. Although in the former case their Lordships included 'other members of inferior tribunals' in the ambit of the rule they were propounding, nothing in the authorities approved by the House or in their Lordships, own reasoning extended on the face of it beyond inferior judicial tribunals. There is therefore, in Mr Ryan's submission, no binding authority which applies the Gough test to such a body as a local planning authority. Commenting on the Gough test, the editors of the fifth edition of de Smith on Judicial Review of Administrative Action (one of whom is Lord Woolf) at paragraph 12-011 remark:

"The test of bias has been settled by Gough - at least in relation to criminal adjudications. However, the test cannot be mechanically applied to a particular case and it is now necessary to consider some particular situations in which a decision-maker may be disqualified for bias."

The succeeding text considers the application of the Gough principle to particular situations but affords no direct support for the proposition that cases such as the present are governed by a different principle. The different principle for which Mr Ryan contends is exemplified in the decision of Glidewell J in R v Sevenoaks DC, ex parte Ferzy [1985] 3 All ER 226. In that case a local authority's grant of planning permission to a developer was attacked on the ground that the local authority, which owned the land and had leased it at a substantial premium to the applicant developers, had fettered its own discretion. Glidewell J distinguished both the Lannon case (supra) and R v Hendon RDC, ex parte Chorley [1933] 2 KB 696 (to which I shall come later) in this way:

"Both Lannon and Chorley were cases in which the circumstances differed from those of the present case. In Chorley it was an individual councillor who took part in the voting, although he had a financial interest and was thus biased. In Lannon the proceedings were judicial in nature, and thus the maxim that justice must not only be done but be seen to be done applied. The present case is an illustration of an administrative, as opposed to a judicial, decision, where it is the council itself, not any individual councillor, which has an interest in [the premises]".

Answering the question posed to him, which was whether the council in the circumstances was able to exercise a proper discretion, Glidewell J held that it was. In coming to this conclusion he had considered the decision of the New Zealand Court of Appeal in Lower Hutt City Council v Bank [1974] 1 NZLR 545, where McCarthy P had accepted that a council could impartially decide a planning question relating to land in which it had an interest, but that the Lower Hutt council had so compromised itself that its decision could not stand. In arriving at a contrary conclusion on facts of the case before him, Glidewell J cited with evident approval the following parts of McCarthy P's judgment:

"We believe that the clear-cut distinction, once favoured by the courts, between administrative functions, on the one hand, and judicial functions on the other, as a result of which it was proper to require the observance of the rules of natural justice in the latter but not in the former, is not in these days to be accepted as supplying the answer in a case such as we have before us.

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So, in our opinion, whether the principles of natural justice should be applied to the function of a council in considering objections ...... does not turn on any fine classification of that function as judicial or administrative, but that instead whether they apply is to be decided upon a realistic examination of the legislation, the circumstances of the case, and the subject matter under consideration."

In my view, when in the passage quoted earlier Glidewell J characterised the decision before him as an 'administrative, as opposed to a judicial decision', he was doing so not in order to erect differential standards of adjudication but, as the passage shows, in order to point out that it was not bias on the part of an individual councillor but the interest of the council itself which was the foundation of the challenge. If the applicant had made it his case that the council was acting as judge in its own cause, the submission would have met with the plain answer that Parliament had authorised it to do so. Hence the different line of attack based on the fettering of discretion. The case is not, in my judgment, a case on the disqualification through personal interest of a member of a decision-making body; nor does it support the proposition that such a ground of challenge is unavailable in local government law.

It is true that in Anderton v Auckland City Council (1978] 1 NZLR 657 Mahon J decided an issue concerning long-term collaboration between the planning authority and a developer in the light of the law of (as he called it) presumptive bias, sub-dividing this into the bias which is irrebutably presumed on proof of a pecuniary interest and bias which is inferred from proof of a real likelihood that the issue has been predetermined. But this case is relied upon by Mr Hobson for a different proposition, namely that the effect of bias can be cumulative. If one goes from the discussion of presumptive bias (page 686-7) to the concluding reasoning of Mahon J (page 696-8) his conclusion that actual predetermination had been established was based upon his finding that

"..... the council had become so closely associated with the company in attempts to secure planning permission for the company's project that ......... it had completely surrendered its powers of independent judgment as a judicial tribunal."

The surrender by a decision-making body of its judgment, which would have been another way of putting the ground of challenge in ex parte Terry, while it can legitimately be described as a form of bias, is jurisprudentially a different thing from a disqualifying interest held by a participant in the process. There may well be facets of the statutory set-up which contemplate dealings at less than arm's length between a planning authority and a developer, and these may in turn qualify the questions upon which independent judgment must be brought to bear and so preserve a decision in which the planning authority has a pecuniary or other interest. But there is a difference of kind and not merely of degree between this situation and the situation of a participant member of a decision-making body who has something personally to gain or lose by the outcome.

Other decided cases, however, upon which Mr Ryan relies, do concern the participation of an allegedly biased individual in the licensing functions of a local authority. In R v Reading Borough Council, ex parte Quietlynn Ltd. (1986) 85 LGR 387 Kennedy J had to consider the refusal by a panel of councillors to license premises as a sex establishment, when two of the members belonged to the majority group which had previously decided that it was not in favour of sex establishments, and when one of them had written to the local press saying that sex shops should be banned altogether. The grounds of challenge were improper influence by reason of the majority group's decision of principle and apparent bias in the member who had written to the press. Kennedy J had to attempt a reconciliation of the authorities which the House of Lords was to re-analyse some years later in Gough. Thus, in seeking to distinguish the Lannon case he noted that the case concerned disqualification from sitting in a judicial rather than in a quasi judicial or administrative capacity. For reasons which I have already considered, this distinction is no longer necessary in order to explain the Lannon case; and for reasons to which I shall come it is not a distinction which in principle can any longer be tenably made. The essential ground for Kennedy's rejection of the critique of the local authority is to be found at page 397:

"This is a situation in which Parliament has entrusted to local authorities the task of deciding whether or not to grant licences, and it is only to be expected that the local authority will bring into play their local knowledge and that those who represent it will have views, perhaps even strong views, about whether or not in general licences ought to be granted and if so what conditions are to be imposed."

This proposition, although associated in counsel's submission and later in Kennedy J's judgment with the proposition that the panel was not a judicial body, has validity in principle without need of the distinction. The practical value of the distinction is that it points up the way in which the rule against individual bias, which is a unitary rule, will nevertheless be applied to different effect in different contexts. Thus Kennedy J adopted the unreported judgment of Forbes J in R v Exeter City Council, ex parte Quietlynn Ltd. (22nd February 1985), in which Forbes J had refused to interfere with refusal of a sex shop licence by a committee which included a councillor who had led a campaign to ban all sex shops in Exeter. Forbes J, too, had had to distinguish the Lannon case and so had drawn attention to the Court of Appeal's reliance on Mr Lannon's judicial capacity, continuing:

"It is not, I think, appropriate to translate the law and practice about 'bias' in justices or other tribunals, whose jurisdiction can properly be called judicial, into the context of decisions made by administrative bodies, even where part of the consideration given by those bodies to the decisions they must make can be called quasi-judicial. I remain quite unsatisfied that in this case, however unfortunate it may be that one councillor had so clearly signalled his opposition, the decision to refuse a licence could be said to be tainted with irregularity."

Kennedy J, who like Forbes J was concerned to arrive at the right result without ignoring the Lannon case, adopted this approach. Today, however, following the decision in Gough the same conclusion will be reached not by drawing a line between judicial and other functions but by deciding whether there was a real danger of bias by reference to circumstances which prominently include the particular nature and function of the body whose decision is impugned. In this way the necessary involvement of local elected councillors in matters of public controversy, and the probability that they will have taken a public stand on many of them, limits the range of attack which can properly be made upon any decision in which even a highly opinionated councillor has taken part. This is why in R v Amber Valley District Council, ex parte Jackson [1935] 1 WLR 298 Woolf J was able to hold that although the principles of natural justice governed applications for planning permission, these principles were not violated by a decision of the majority party that it supported a particular planning application. Woolf J, without drawing any distinction between the judicial and the administrative, held:

"The rules of fairness or natural justice cannot be regarded as being rigid. They must alter in accordance with the context. Thus in the case of highways, the Department can be both the promoting authority and the determining authority. When this happens, of course any reasonable man would regard the Department as being predisposed towards the outcome of the inquiry. The Department is under an obligation to be fair and carefully to consider the evidence given before the inquiry but the fact that it has a policy on the matter does not entitle the court to intervene. So in this case I do not consider the fact that there is a declaration of policy by the majority group can disqualify a district council from adjudicating on a planning application. It may mean that the outcome of the planning application is likely to be favourable to an applicant and therefore unfavourable to objectors. However, Parliament has seen fit to lay down that it is the local authority which has the power to make the decision ....."

Even so, Woolf J had had like other judges to distinguish the Lannon case on the ground that it concerned a judicial or quasijudicial decision. The need to make such a distinction in order to arrive at the plainly correct results reached in ex parte Terry, ex parte Quietlynn Ltd, ex parte Jackson and other such cases has in my view gone with the decision in Gough. This is because in Gough the House of Lords has assimilated the test of appearance of bias to the now unitary test of a real danger of bias, in part by assimilating the hypothetical observer to the court hearing the challenge, and correspondingly by assimilating the maxim that justice must be seen to be done to the court's duty to identify any real danger of unjust bias. It is by these criteria in the context of the respondent's statutory function, and not by a prior characterisation of that function, that the facts in Lannon would today fall to be tested.

This being so, there is in my judgment nothing in the jurisprudence of Gough which necessarily limits to judicial or quasi-judicial tribunals the rule against the participation of a person with a personal interest in the outcome. The line of authority relied upon by Mr Ryan represents, in my view, a different although equally important principle: that the decision of a body, albeit composed of disinterested individuals, will be struck down if its outcome has been predetermined whether by the adoption of an inflexible policy or by the effective surrender of the body's independent judgment. The decision of the House of Lords in Franklin v Minister of Town and Country Planning [1948] AC 87 cannot now be regarded as diluting this principle.

The application of these two distinct principles is well illustrated by the decision of Brooke J in an unreported case, R v Chesterfield Borough Council, ex parte Darker Enterprises Ltd. (18th May 1992). Renewal of a sex shop licence had been refused by a sub-committee of the council which had been chaired by a councillor known to be strongly opposed to sex shops in general and to the applicants, shop in particular, and had included a councillor who was a director of the Co-Operative Society which owned the neighbouring retail premises and which hoped to expand into the sex shop premises if its licence was not renewed. Brooke J, following the decision of Kennedy J in ex parte Quietlynn Ltd., held that the chairman's participation was unobjectionable provided that, whatever his views, he was prepared to listen; but that the participation of the other councillor, despite his declaration of an interest and consequent abstention from voting, would have persuaded a fair-minded observer who knew of his Co-Op connection that it was unfair for the councillor to be present and to have participated in questioning the applicants, even though he had abstained from the debate and voting. Brooke J was, of course, applying the pre Gough test, but it is probable that, on the facts before him, he would have come to the same conclusion about the councillor had he asked whether there was objectively a real danger of bias. He made a clear distinction between the two legal tests:

"I am satisfied that in a situation like this, where the involvement of a councillor is challenged not because of his public views on the merits of the matter being discussed but in relation to his private interests, in relation to companies of which he is a director, the question as to whether a decision to which he is party can be successfully quashed is not to be tested by the principle laid down by Kennedy J in the Reading case [ex parte Quietlynn Ltd] but in accordance with the general line of cases on bias which culminated in the decision of the divisional court in R v Liverpool City Justices, ex parte Topping [1983] 1 WLR 119 [a decision considered in R v Gough]."

The distinction is of course one which was recognised by Glidewell J in his judgment in ex parte Terry. The same distinction has been pinpointed in a decision of the Hong Kong High Court R v Chairman of the Town Planning Appeal Board, ex parte Mutual Luck Investment Ltd. (26th May 1995), which the industry of Mr Drabble's second junior has made available. Leonard J in the course of his judgment said:

"The parties have not sought to discuss the question of the meaning of the term 'direct or indirect interest', but it seems to me that such an interest must be a real personal interest in the sense that the person concerned has something to gain or something to lose, directly or indirectly depending on the outcome ....... I do not think that the words are intended to mean that the person in question holds a private opinion about some matter of general interest ......"

While this case was being argued before me the judgment of the Privy Council in Eves v Hambros Bank (Jersey) Ltd [1996] 1 WLR 251 was reported. Mr Ryan relied on it as showing that an undoubted pecuniary interest is not a disqualifying factor where a mere administrative function is being performed. A borrower had defaulted upon a bank loan for which he had pledged his house as security, and the bank had taken possession of the house. Its application to the Royal Court for an order confirming its 'tenancy' of the house came before a court of which one member was a director or former director of the bank. In the Court of Appeal of Jersey Sir Godfray le Quesne QC had remarked - and the Privy Council endorsed it - that it might have been better if the director had withdrawn from the court; but both the Court of Appeal and the Privy Council declined to interfere with the Royal Court's decision to refuse the appellant an adjournment and to confirm the bank's tenure. The ground of the decision was that the particular proceeding which was before the Royal Court was an ex parte matter in which the appellant had no locus standi. The Privy Council held:

"In order for a litigant to be able to complain that a member of the tribunal has made himself a judge in his own cause, there must be a question which has to be decided as between the litigant and another party. In this case there was none."

Their Lordships went on to distinguish the doctrine of Gough as relating 'to proceedings in which the party objecting was legitimately concerned'. The judgment in Eves is not in my view authority for the proposition that it is only in a lis inter partes that the rule against sitting as judge in one's own cause operates. The decision is simply that a person who had no right in any event to be heard (no doubt because the proceeding was a routine step not open to disputation) has no locus from which to contest the consequent order on any ground, including alleged bias in a member of the court. By contrast, once the sufficiency of the interest of an applicant is established, as it is in the present case, the decision in the Eves case has no bearing.

If, conformably with Mr Ryan's submission, there are not two separate principles in play but only the one for which he contends, remarkable results follow. Suppose that I want to erect in my garden a building which the neighbours consider an eyesore and which will materially diminish the value of their properties; and that I find later that one of my objecting neighbours was a member of the committee which turned down my planning application. Mr Ryan, standing by the logic of his argument, submits that the neighbour's participation is unobjectionable in law unless it can be shown that not only he but the committee had predetermined - not merely was predisposed - to refuse my application; and that although the neighbour can now be prosecuted under section 94 of the Local Government Act 1972 for taking part in a decision on a matter in which he had a pecuniary interest, and although I can appeal to the Secretary of State and expect to recover my costs on the ground of my neighbour's unreasonable behaviour, nevertheless this court is powerless to strike down a decision in which an individual with a disqualifying personal and pecuniary interest has participated. It would be strange if it were so.

Not only is there therefore no authority which limits the Gough principle to judicial or quasi-judicial proceedings; there are sound grounds of principle in modern public law for declining so to limit it. The concrete reason, which is not always given the attention it deserves, is that in the modern state the interests of individuals or of the public may be more radically affected by administrative decisions than by the decisions of courts of law and judicial tribunals. The individual who has just been tried for a minor road traffic infraction will not be much comforted by the fact that he was tried with the full safeguards of the criminal law if on returning home he finds that an administrative decision in which he had no say is going to take away his home or his job. Nothing in the years since the publication in 1947 of the second edition of Robson's Justice and Administrative Law has diminished the accuracy of what Robson wrote (pages 4-5):

" .... it is probably the fact that some functions of government are not capable of classification into legislative, executive and judicial powers. It is very difficult to discover any adequate method by which, in a highly developed country like England, judicial functions can be clearly distinguished from administrative functions. Mere names are of no avail, for, as we shall see, judges often administer, and administrators often judge. It is easy enough to take a typical example of each kind of function, and to identify it as belonging to a particular category. But that does not get us out of the difficulty, unless we can extract from it some characteristics essential to its nature. A further difficulty arises from the fact that many of the features which once belonged almost exclusively to activities that were carried on only in courts of law, are now to be observed as attaching also, to a greater or less extent, to activities carried on by other departments of government. Furthermore, what we may call the judicial attitude of mind has spread from the courts of law, wherein it originated, to many other fields, with the result that an increasingly large number of governmental activities bear the marks of both the administrative process and the judicial process, and cannot be distinguished by any simple test. 'The changing combinations of events will beat upon the walls of ancient categories', a distinguished American judge has observed; and that is precisely what has occurred in the classification of governmental functions in England."

This is why modern public law, since the landmark decision in Ridge v Baldwin [1964] AC 40, has set its face against the partitioning of proceedings into judicial, administrative and something in between. The distinctions are not only increasingly hard to make in the variety of adjudicative processes in the modern state; they were historically mistaken. The celebrated chapter of Professor Wade's Administrative Law on the right to a fair hearing (currently chapter 15 in Wade & Forsyth's Administrative Law, 7th edition) shows how the centuries-old jurisdiction of this court over both administrative and judicial acts was mistakenly collapsed into a notion of control over judicial acts only, followed by an artificial expansion of the concept of the judicial to include much that was in truth administrative. Since Ridge v Baldwin, although not without occasional deviations, public law has returned to the broad highway of due process across the full range of justiciable decision-making. One effect of this is that the maxim audi alteram partem is not to be regarded as a free-standing principle covering only proceedings in which there can be said to be sides or parties, but is one application of the wider principle that all relevant matter must be taken into account.

The unsuccessful submission in Ridge v Baldwin (which had succeeded in the Divisional Court and Court of Appeal) that the Chief Constable had no right to be heard by a Watch Committee considering his dismissal for misconduct today seems unarguable. As Lord Hodson said [1964] AC 130:

"The answer in a given case is not provided by the statement that the giver of the decision is acting in an executive or administrative capacity as if that were the antithesis of a judicial capacity. The cases seem to me to show that persons acting in a capacity which is not on the face of it judicial but rather executive or administrative have been held by the courts to be subject to the principles of natural justice."

Wade and Forsyth comment (7th edition 512):

"The mere fact that the power affects rights or interests is what makes it 'judicial' and so subject to the procedures required by natural justice." (My emphasis).

The reference to interests as well as to rights is important. Public law is concerned not only with the vindication of positive rights but with the redress of public wrongs wherever the court's attention is called to them by a person or body with a sufficient interest.

I hold, therefore, that the principle that a person is disqualified from participation in a decision if there is a real danger that he or she will be influenced by a pecuniary or personal interest in the outcome is of general application in public law and is not limited to judicial or quasi-judicial bodies or proceedings.

How then will the principle apply to a body exercising town and country planning powers? In the case of an elected body the law recognises that members will take up office with publicly stated views on a variety of policy issues. In the case of an urban development corporation the Secretary of State will have had regard, in making his appointments, to the 'desirability of securing the services of people having special knowledge of the locality' (schedule 26 paragraph 2(2)), as well as to the proactive purpose of the corporation set out in section 136(l) 'to secure the regeneration of its area'. In both cases, where predetermination of issues or forfeiture of judgment is alleged, the court will be concerned to distinguish, within the statutory framework, legitimate prior stances or experience from illegitimate ones. But such issues will be governed by the separate line of authority on pre-determination. So far as concerns apparent bias, there can be little if any difference between an elected and an appointed planning authority. In both cases there is a constant risk that the body will have to decide matters in which a member happens to have pecuniary or personal interest. In such cases, as the Secretary of State's successive codes for urban development corporations and for local government recognise, unless it is too remote or insignificant to matter, the interest must be declared and the member concerned must not participate in the decision. The likelihood that some such conflict of interest will sooner or later arise for a member appointed to an urban development corporation pursuant to the provisions of the 1980 Act is no more an excuse for non-observance of the principle of disqualification than it would be for a member elected to a planning authority on a platform of planning issues. The Gough test of bias will be uniformly applied: what will differ from case to case is the significance of the interest and its degree of proximity or remoteness to the issue to be decided and whether, if it is not so insignificant or remote as to be discounted, the disqualified member has violated his disqualification by participating in the decision.

The law makes a distinction between pecuniary and other personal interests. On authority, a direct, pecuniary or proprietary interest, however small, is conclusively presumed to create a real danger of bias: see Gough and the cases there cited. It may be that a direct pecuniary interest is meant to be contrasted with an indirect one (for example, an interest not in the member's own assets but in those of a close relative); or it may simply be the antonym of one which is too remote. The latter meaning was apparently the one used in the Lannon case, where Lord Denning MR at [1969] 1 QB 598 adopted the Divisional Court's decision that the rent assessment committee chairman had had no direct pecuniary interest. The Divisional Court's reasoning on this point is reported at [1967] 1 WLR 815, 828, where Widgery J held:

"........ I for my part am quite satisfied that the connection ....... is far too remote to justify the inference of bias ......."

It is of some interest that in the leading case of R v Rand (1866) LR 1 QB 230 Blackburn J, speaking for the Court, did not use the adjective direct, to qualify the phrase 'pecuniary interest' in each place where he used it; but at the point where he did so qualify it, he went on to include among direct pecuniary interests even the possible liability of trustees to costs, suggesting a wide ambit of disqualifying pecuniary interest of which, it may well be, the single cut-off point is remoteness. If so, the search for examples of indirect pecuniary interests is unnecessary: if an interest cannot properly be called pecuniary, disqualifying the decision-maker because he had something of monetary value to gain or lose by the outcome, it will be gauged by the ordinary test of danger of bias, subject to any question of remoteness or insignificance. 'Direct' will then simply be the antithesis of remote. This would be my preferred approach because it eliminates a potential and unnecessary complication in the law; but in what follows I allow for the possibility that the law does recognise an intermediate category of indirect pecuniary interest.

Other interests (including, if they are a separate category, indirect pecuniary interests) must be evaluated in relation to the individual concerned and the matter to be decided: see Lord Woolf in R v Gough at 673. De Smith Judicial Review of Administrative Action (5th edition) at paragraph 12-030 summarises in this way the point at which a connection becomes too remote:

"Disqualification for bias may exist where a decision-maker has an interest in the issue by virtue of his identification with one of the parties, or has otherwise indicated partisanship in relation to the issue.

Two main classes of case may arise although they are by no means exhaustive. The first is where an adjudicator is associated with a body that institutes or defends the proceedings. The courts have refused to hold that a person is disqualified at common law from sitting to hear a case merely on the ground that he is a member of the public authority, or a member of or subscriber to the voluntary association, that is a party to the proceedings, unless he has personally taken an active part in instituting the proceedings, or has voted in favour of a resolution that the proceedings be instituted, for he is then in substance both judge and party."

Thus in R v Handsley (1882) 8 QBD 383 it was held that a member of the prosecuting local authority was not disqualified from sitting as a justice to hear a summons against a ratepayer in arrears. There was neither a disqualifying personal interest capable of amounting to bias nor a direct pecuniary interest, and the member's pecuniary interest as a member of the council seeking to recover the rate was too remote or insubstantial to create any likelihood of bias. Similarly in R v Barnsley Justices, ex parte Barnsley Licensed Victuallers, Association [1960] 2 QB 167 the Court of Appeal found no significant danger of bias in the chairman of a bench of licensing justices which had granted an off-licence to the Co-Operative Society to which the chairman belonged, notwithstanding that he had once stood for election as a director; but it is clear that the Court of Appeal would have decided otherwise if the evidence had been that he proposed to stand again and that his candidature would be helped by having, as a licensing justice, granted the Co-Op an off licence. In R v Deal Justices, ex parte Curling (1881) LT 439 it was held by a Divisional Court that a member of the RSPCA was not disqualified from sitting as a justice to hear a prosecution brought by the RSPCA. Had the justice had some control over or responsibility for the prosecution, the decision would have been otherwise.

Mr Hobson and Mr Drabble accordingly agree that some form of active involvement in an interested organisation is a minimum pre-condition for the establishment of bias. They adopt what Lord Widgery CJ said in R v Altrincham Justices, ex parte Pennington [1975] QB 549, 554:

"If [in the day's list] there is a case involving an Organisation in which the justice is actively employed, and, moreover known locally to be actively employed, then I have no doubt that the justice should either disqualify himself or herself, or at all events bring the matter to the attention of the parties before the case is opened and see if there is any objection, which is really doing the same thing."

This passage forms a useful bridge with the next issue which the present case raises: what should a member of a body do or refrain from doing when a conflict of interest arises? Where the issue arises in a lis inter partes the course described by Lord Widgery CJ can readily be adopted: if either party objects to the continued participation of the person declaring an interest, the objection is ordinarily conclusive; and even in the absence of objection it may be wise in some cases for the decision-maker to stand down, bearing in mind what Shaw J added in the Altrincham Justices' case:

"................ Wherever a question of this kind does arise it would be prudent for the justice concerned to apply a meticulous rather than a casual test to the situation."

Where, however, the body is taking a decision in which all those interested are not before it and able to waive the objection, which is the general case in local government and equally in urban development corporations' proceedings, then the disqualification operates without the possibility of waiver. Indeed, as Mr Hobson submits with some force, the need to be rigorous about non-participation is even greater in a body such as an urban development corporation which does not necessarily or ordinarily meet in public or publish its proceedings, as compared with an elected local authority which is required by law to sit in public and to publish its proceedings save only in relation to confidential items.

It is accordingly Mr Hobson's submission, and one which is important in relation to the facts of this case, that any member of a decision-making body who has an interest requiring to be declared must not only refrain from voting on the issue but must absent himself or herself from the meeting while the issue is discussed. Mr Drabble submits that there is no such rule. For the reasons explained by the House of Lords in Gough, I accept that there is no such rule - but this is a long way from concluding that a member with an interest to declare has no need to do more than refrain from voting. The applicable principle s not a matter of form but of substance: it is that an individual with a personal, pecuniary or proprietary interest in the subject matter of the decision is disqualified from participating in it. Mr Drabble has accepted, subject to possible questions of discretion, that the participation of a single member who is disqualified by bias vitiates the decision.

Participation can manifestly be more than voting or discussion. A justice who, on retirement, tells his colleagues that it is his car which the defendant is charged with taking and wrecking, and who then sits with arms folded while the other justices reach a conclusion, might not be regarded by this court as having abstained from participation simply by having declared his or her interest and neither spoken nor voted. The silent presence on the appeal committee of the Chief Constable, who as the instigator of the charges had no right to be there, was one of the factors which moved the Court of Appeal to interfere in the case of Cooper v Wilson [1937] 2 KB 309:

"But even if the presence of the respondent sitting to all appearances among the members of the Tribunal could be said not to vitiate the proceedings, the fact that he remained with them when the court was cleared for the committee to consider its decision is fatal to the validity of the proceedings. It makes no difference whether he then discussed the case with them or not ........... as there was from the appellant's point of view secrecy and the risk of bias through the tribunal seeing one party without the other being present."

Similarly it is not necessary for a disqualified member to cast a vote which is counted in order to be guilty of participation. In R v Hendon PDC, ex parte Chorley [1933] 2 KB 696 the Divisional Court treated a disqualified councillor as having voted on a decision which had been taken by general assent.

It is thus distinctly possible that the mere declaration of a disqualifying interest, followed by abstention from discussion or voting, will not be enough to negate participation in the decision. This is why the courts, like the Secretary of State, have repeatedly counselled caution, not only for the sake of appearances but because the line between participation and abstention is in many cases a fine one. Thus in Leeson v General Medical Council (1889) 43 Ch 366, although the majority of the Court of Appeal held that a member of the Medical Defence Union was not disqualified from sitting as a member of the General Medical Council to hear a complaint brought by the Medical Defence Union, Fry LJ dissented on the ground of apparent bias and Bowen LJ, although in favour of upholding the adjudication, said:

"I think it is to be regretted that these two gentlemen, as soon as they found that the person who was accused was a person against whom a complaint was being alleged by the Council of a society to which they subscribed, and to which they in law belonged as members, did not at once retire from the Council. I think it is to be regretted, because judges, like Caesar's wife, should be above suspicion, and in the minds of strangers the position which they occupied on the Council was one which required explanation. Whatever may be the result of this litigation, I trust that in future the General Medical Council will think it reasonable advice that those who sit on these inquiries should cease to occupy a position of subscribers to a Society which brings them before the Council."

I have set out earlier in this judgment substantial extracts from the relevant codes issued by the Secretary of State for urban development corporations and for local authorities. The National Code of Local Government Conduct is detailed and thorough in its guidance: in particular, paragraphs 11 and 12 make it clear that subject to specified exceptions, a member who has a clear and substantial interest to declare 'should never take any further part in the proceedings and should always withdraw from the meeting while the matter is being considered'. The Code of Conduct for chairmen and board members of urban development corporations, by contrast, in its 1988 version advises that (unless the interest is remote and insignificant, and the other members of the corporation agree to waive it):

"Normally the board member should not take part in the consideration or discussion of the contract, planning application etc. or vote on it."

There is no indication of what 'normally' means and no advice at all about withdrawal. The amended 1992 version, in what became paragraph 16, added the passages which I have italicised in the quotation earlier in this judgment. The guidance now takes the form that in the event of a significant conflict the member should leave the room - except in the case of a meeting held in public, when the member may remain but not participate. Although these codes are not a source of law, for the reasons which I have given it seems to me that neither version of the code of conduct for urban development corporations is satisfactory, because both create a risk that decisions will be held void for bias on the ground of the participation of one or more members with a pecuniary or personal interest. In particular I find puzzling the distinction made, in relation to withdrawal, between meetings held in public and meetings held in private. Nor do I understand why the Secretary of State should appear to be setting different standards for members of an elected local authority and members of an appointed development corporation in relation to the avoidance of apparent bias. None of the differences in the nature or constitution of the two types of body justify such distinctions, and the law, in my judgment, is the same for both. If anything, the court is more likely to find a real danger of operative bias in a decision taken behind closed doors than in one taken in public. While withdrawal is not a universal requirement of the law when a conflict of interest arises, it is undoubtedly wise advice.

One further puzzle remains: what is meant in paragraph 1 of the code for urban development corporations by 'executive officers of a political party'? Nobody, including counsel for the Secretary of State, has been able to tell me what it means. It is of course only advice, but it is so delphic that counsel have disagreed as to whether one of the individuals with whom I am concerned, Mr Hartley, was or was not acting in breach of this advice when he stood for and won office as chairman of his party's ward association. In point of law, I consider that there is no prior objection to members of public bodies holding political office of any kind, at least so far as the law of bias is concerned; but holding such office adds a further element to the possibilities of a conflict of interest, and must be watched accordingly. The chief executive of the Leeds Development Corporation, Ralph Martin Eagland, has produced to the court a one-page memorandum which he drew up after consulting the Corporation's solicitors in October 1989 and which the Corporation adopted as its policy on the declaration of members' interests. (Here, as elsewhere, I use the language of the statute which is straightforward and which makes the appointed individuals members of a corporation. For some reason this nomenclature has been abandoned by the Department and by the Corporation itself in favour of the terminology of limited companies, referring to the members as 'directors' and to the Corporation as 'the board'). Paragraph 3 of this memorandum says:

"It is not necessary for a director with an interest to withdraw physically from the room during discussion of that matter [viz one in which he has declared an interest], but it may in certain circumstances be considered to be most tactful in permitting a full and free discussion. Any director declaring an interest should be prepared to accede to a request that he/she does leave the meeting for that particular agenda item."

This, it seems to me, comes closest to advice likely to avoid infractions of the law.

The planning issues

The regeneration of the Kirkstall Valley was part of the remit of the Leeds Development Corporation throughout its existence. The valley lies little more than a mile from Leeds city centre on the river Aire. Although high density housing exists to both sides of it the valley floor is relatively undeveloped. It includes, in an L-shaped area of land, three rugby pitches which at all relevant times were owned by Headingley Football Club (and which have now been bought, with the benefit of the challenged planning consents, by the second respondent, together with the clubhouse); and a sports ground, the Archie Gordon sports ground, owned by the Leeds School Sports Association, a charitable trust. Leeds City Council's 1972 development plan allocates the area correspondingly for public open space, playing fields and associated amenities. Its unitary development plan was being formulated during the period with which I am concerned, and the Corporation differed from the City Council to the best plan for the future of the Kirkstall Valley. By Regulation 9 (1) (c) of the Town and Country Planning (Development Plan) Regulations 1991 the City Council was required to have regard to the Corporation's policies and proposals. And by s. 70 (2) and (by an amendment taking effect on the 25th September 1991) s.54A of the Town and Country Planning Act 1990 the Corporation as planning authority was required to have regard to the existing development plan and to conform to it 'unless material considerations indicate otherwise' - a duty incumbent on it when it came to decide the material applications under s. 70 (1) . Because no challenge is raised to the legitimacy of the various strategic and policy objectives adopted and pursued respectively by Leeds City Council and the Leeds Development Corporation, I do not need to consider their interrelationship in any detail. Nor is there any dispute about the legitimacy of the concern of the present applicants to preserve playing fields and open spaces in the Valley and to avoid development which would bring inappropriate retail use and traffic congestion. The relevant fact for present purposes is that by the end of 1990 the Corporation had decided upon its Strategic Plan and its Planning Framework, in the light of which it took its specific decisions.

The particular decisions with which the present challenge is concerned (apart from one truly minor issue to which I will come at the end of this judgment) are the Corporation's resolution on the 21st July 1994 to grant planning permission for retail development in the form of a supermarket on the pitch forming the foot of the L, which was part of the rugby club's property; and - following the Secretary of State's decision not to call in the decision and subject to a section 106 agreement - the reserved matters decision of the 29th March 1995, the very eve of the Corporation's demise. If the first falls the second must fall too; alternatively the second may fall even if the first stands; but the issues as they have emerged make it unnecessary to distinguish between the two decisions. The case for the applicants is that one or both were vitiated by personal interest amounting to apparent bias on the part of three members and an officer of the Corporation.

It was the Planning Framework which marked the abandonment of comprehensive proposals for the Kirkstall Valley which had been earlier put into play by developers and their consultants. Instead smaller-scale proposals were envisaged as the basis of planning applications and consents. One important factor in the adoption of the Planning Framework was that the Rugby Club was known to want to find a new location. While, naturally, this would be facilitated by its obtaining a good price for its existing site, the information was separately relevant to the Corporation since if the rugby club had no wish to move there was no point in contemplating any change in the use of its land. The Corporation in 1992 decided accordingly that it would resist the City Council's emerging Unitary Development Plan in favour of the Corporation's proposals to permit development of what the City Council hoped to preserve as urban open space. At the Corporation's meeting on the 21st January 1993, in closed session, Kirkstall Valley Properties Ltd. was permitted to make a presentation of a proposed retail and housing development on the land in question, and at the conclusion of the presentation was invited to submit a planning application for the proposed development. In due course, in August of 1993, the Corporation decided to make a formal objection to the policies affecting Kirkstall Valley, car parking and shopping in the City Council's draft Unitary Development Plan.

In April 1993 the first planning application was made by Kirkstall Valley Properties, following some 11 months of discussions, for what has become known as the comprehensive scheme. The rugby club had naturally been interested in the proposal and set up a sub-committee in the summer of 1992 to negotiate the sale of the club's site. The Leeds School Sports Association, too, was in negotiation f or the sale of its freehold during the latter part of 1992. A site acquisition status report of the 18th August 1992 said:

"Unless the sale of the Headingley FC ground achieves a commercial site value then it is understood that the development of the proposed new ground for the newly formed Leeds RFC will not be able to proceed."

The proposed new ground at this time was at Shadwell, another area of Leeds on the edge of the green belt. The proposal to move to Shadwell arose in December 1991 and remained alive until February 1993 when it became apparent that the local authority, which owned the land, was not prepared to sell it to the rugby club. This period of time is therefore critical, because it is the foundation of what I regard as by far the most serious attack upon the validity of the impugned planning decisions. The initial proposal of Kirkstall Valley Properties was for major leisure and retail development with car parking for almost 1500 vehicles, a little over 100 units of affordable housing and a gyratory traffic system. For a variety of reasons which it is not necessary to go into, the scheme proved non-viable and was abandoned finally by March 1995. By that date, however, the Corporation had entertained and approved the so-called compromise scheme which is the subject of the present application. It is not submitted that the scheme is intrinsically unlawful: Mr Hobson accepts that it conforms sufficiently with the Planning Framework and strategic plan to be capable of attracting planning consent, and Mr Drabble for his part accepts that the continuing objections to it are tenable and bona fide, even though he adds that many of the earlier objections have been met. The challenge turns upon the question whether the impugned decisions are vitiated by the participation of members or an officer of the Corporation who had disqualifying personal or pecuniary interests, some declared and some not.

The individual interests

(a) Peter Hartley. A prominent Yorkshire businessman, Mr Hartley was appointed chairman of the Leeds Development Corporation at its inception and remained in that position throughout its life. He was present and in the chair at all the material meetings of the Corporation.

Insofar as they are material to this case, his other interests included membership (initially as a playing member) of the rugby club from the mid-1950s until the mid-1960s and membership of the North-East Leeds Conservative Association, within which he was chairman of the Roundhay Ward association (which included his home in Shadwell) from December 1990 to February 1992, when he was replaced as chairman by Stuart Kenny (an officer of the Corporation whose role I consider later).

Mr Hobson does not contend that the rugby club connection by itself was sufficiently significant by the time of the matters with which I am concerned to have a bearing, but he relies on the other matter as constituting or contributing to an undeclared disqualifying interest in the decisions to which I have referred.

The evidence shows that Mr Hartley, with his wife, owns and lives at Shadwell Grange with some ten acres of its own land. Immediately adjacent is a much larger piece of open land owned by the P A Hartley 1972 Settlement, a trust established by Mr Hartley for the benefit of his two children. The trustees (who are now two chartered accountants in Jersey) bought the 50 acres at the suggestion of Mr Hartley at the same time as Mr Hartley and his wife bought Shadwell Grange. 'The Trustees, as a matter of courtesy, keep me informed of, and ask my opinion upon, matters relating to that land from time to time', Mr Hartley deposes. The two parcels of land, amounting to some 60 acres, which I will call the Hartley land, form the tip of a peninsula of green belt land entering the built-up part of Shadwell from the east. The land forming the neck of the peninsula, and isolating it from the rest of the green belt, had been purchased by Leeds City Council with a view to developing it as a golf course; but no planning application to this end was ever made. It was this land which the rugby club had by 1991 selected as its preferred relocation site. It would be able to purchase the site if, and only if, it could sell its existing site in the Kirkstall Valley for a sufficiently substantial sum. Such a sum could be achieved only if the Kirkstall Valley site could be sold with the benefit of planning permission to redevelop it for commercial use. I will return to such relevance as this has to other members or officers of the Corporation connected with the rugby club; but its present relevance is its connection with the Hartley land.

Mr Hartley has never made any secret of the fact that he considers that the Hartley land should not form part of the green belt and should be zoned for housing development of the kind which over the years has come to surround it on three sides. At a public meeting in Shadwell in March 1992, when he was chairman of the ward Conservative Association, Mr Hartley spoke in favour of the rugby club's proposal to move to Shadwell. He spoke, he deposes, as a private individual.

Before moving on, let me deal with Mr Hartley's political position. As I have said, it is impossible to deduce from the Secretary of State's Code whether the chairmanship of a ward Association is included in the phrase 'executive officer of a political party, Mr Drabble tells me that his instructing Department does not regard a ward Chairman as an executive officer, but would regard a constituency Chairman as one. (Mr Hobson makes the relevant point that if this is meant to be a criterion of size, Leeds has the largest wards of any metropolitan district. But this is not a matter of legal consequence). What can be said with confidence is that on the evidence Mr Hartley's chairmanship of the ward Conservative Association constituted neither a pecuniary nor a personal interest capable of coming into conflict with his duties as chairman of the Development Corporation. There is nothing in the nature of, for example, the interest of the councillor who was also a director of the neighbouring Co-Operative Society in the non-renewal of the sex shop licence in ex parte Darker Enterprises Ltd. (ante).

The significance of Mr Hartley's support for the rugby club's move to Shadwell both during and after his period of chairmanship of the ward Association, is simply that it affords further evidence of the reality of his commitment to the proposal. It is this commitment which I regard as critical. Mr Hartley has not disputed the estimate deposed to by Mr Illingworth, for the applicants, that the removal of the Hartley land at Shadwell Grange from the green belt would have enhanced the value of the land by perhaps £20,000,000.

It was not later than the beginning of 1992, according to his own evidence, that Mr Hartley learned of the possibility of the rugby club's moving to Shadwell. He describes in his affidavit how he was first telephoned and then visited by a group of individuals representing the rugby club one of whom, Mr Gareth Read, is now known to have been chairing the subcommittee of the rugby club which was planning the move. Mr Hartley goes on:

"They came to my home and explained that they were canvassing local opinion about the possibility of [the rugby club] relocating to Shadwell ......... I gave my opinion as a local resident to the effect that I was not against the idea, and I assumed that a number of other local residents were approached in a similar way".

Mr Drabble accepts that it can properly be inferred that Mr Hartley was being visited by this deputation not simply as a local resident but because of who he was. There is of course nothing sinister or underhand about the rugby club's having done so; the problem lies in Mr Hartley's failure to perceive any conflict between his personal support for the move and his public duty as chairman of the Development Corporation. He deposes:

"I did not consider that the possibility of land owned by me and my wife and by the trustees of the settlement being advantaged by the possible move of [the rugby club] to [Leeds City Council's] land at Shadwell constituted a notifiable interest of mine when considering the particular issues which arose in relation to the Kirkstall Valley during the period when it was possible that [the rugby club] may move to Shadwell."

The interest in the Shadwell land, which had been known to Mr Hartley since the end of 1991, was by July 1992 being strongly pursued by the rugby club. At a meeting between the developers, architects and Mr Goodrum, the Corporation's director of planning, on the 15th July 1992, Mr Goodrum was told that an offer had been made for the rugby club's site 'close to the rugby club's expectations'. This information, which was confirmed by a letter from the architects late that month, was circulated by Mr Goodrum in a memorandum to, among others, the 'directors' (ie. the members) of the Corporation.

In July 1992 planning consultants instructed by the trustees of the Hartley Settlement land made a submission to Leeds City Council, the body responsible for the still-emerging unitary Development Plan, in favour of the exclusion of the Hartley land from the green belt. The submission concluded:

"Shadwell Grange farm has housing development on three and a half sides. Its only connection to the open country is across the southern half of Roundhay Park Lane. This gap is shortly to be sealed. The land to the east of this part of the road has been acquired for a golf course and a planning application has been lodged for a sports stadium. If either of these uses is developed, the farm will be completely isolated from the countryside. Its exclusion from the green belt would be a logical rounding off of the urban edge of Leeds."

It was not only self-evident, but was also pointed out expressly to the Corporation over which Mr Hartley presided, that:

"unless the sale of the Headingley FC ground achieves a commercial site value then it is understood that the development of the proposed new ground for a newly formed Leeds RFC will not be able to proceed.' (Letter from the agents for Kirkstall Valley Properties Ltd. to the Corporation's chief executive, August 1992)."

I find it difficult to think of a more obvious pecuniary interest than this, whether it is described as direct or indirect. Mr Hartley had an undisguised interest, worth a great deal of money to him, his wife and his children, in getting the Hartley land removed from the green belt. The most powerful argument for persuading the development plan authority to make the change would have been the development of the land separating it from the rest of the green belt. While development as a golf course was in the local authority's hands and not the subject of any planning application, development as a rugby stadium was a real possibility which the rugby club was actively pursuing. It could not, however, become a reality unless the rugby club could sell its existing land in the Kirkstall Valley for the kind of price which could only be realised if it was sold with the benefit of planning permission for retail development. The grant of such permission was within the sole power of the development corporation of which Mr Hartley was chairman.

If Mr Hartley's interest was a direct pecuniary interest, the law presumes bias without more. My preferred view is that this was such an interest. I would regard the fact that the Hartley land manifestly stood to multiply in value if planning consent were given for retail development of the rugby club land as quite sufficient to give Mr Hartley a direct interest in the planning application, even though the effect of the latter on the former would be through a chain of events. But if I am wrong about this (whether because his own interest in the settled land is properly viewed as indirect or because the linkage with his own land was not immediate) then I have no hesitation in holding that the facts which I have described and the clear linkage between them, albeit they were prospects and not yet realities, created a real danger that Mr Hartley would be biased in favour of the proposals for the rugby club land. In no relevant sense was his interest in the Hartley land remote from or insignificant in relation to the Kirkstall Valley planning issues. None of the intervening contingencies was fanciful or inherently improbable.

Mr Hartley, however, and those advising him did not even consider that this was an interest which ought to be declared, much less one which disqualified him from taking part in planning decisions about the rugby club's land. Mr Hartley deposes that on his appointment he had been sent a letter by the Department of the Environment which enclosed the earlier version of the Code of Conduct and went on:

"In order to avoid any potential conflict of interest arising from your position as chairman of the Development Corporation and chairman of Combined Concerns Ltd. we must ask you to give an undertaking that during the period of your chairmanship neither Combined Concerns Ltd. nor any subsidiaries will

(a) engage in land or property transactions with the UDC;

(b) seek financial assistance for any project from the UDC;

(c) seek planning permission or other regulatory consent from the UDC, other than in respect of minor extensions and/or alterations to existing premises that your company may own in the UDC area.'

This passage, like the paragraph of the Code of Conduct which it echoes, is not and does not purport to be exhaustive of what public probity requires; and for the reasons which I have given earlier in this judgment, the later guidance may have obscured rather than clarified what public probity demanded. Even so, when one observes what other members of the Corporation scrupulously took it on themselves to declare as potentially conflicting interests, however minor, I do not consider that any resort to departmental guidance can explain Mr Hartley's view that his interest in the development value of his own and his Settlement's land at Shadwell was not a source of potential conflict with his duties as chairman of a Corporation with power to determine the development potential of the rugby club's land in the Kirkstall Valley, with its anticipated consequences for the zoning and value of the Hartley land.

I have already summarised the items on the Corporation's agenda at meetings held during 1992 and the first two months of 1993, the period when to Mr Hartley's knowledge the rugby club's Shadwell proposal was a live one. While no definitive decision was taken at any of them, each of them - and this is the foundation of Mr Hobson's next main submission - was laying the ground upon which the eventual grant of consent for the compromise scheme, still involving retail development of part of the rugby club's land, was intended eventually to be based. The issues during 1992 related to the tension in principle between the corporation's proposals for the Kirkstall Valley, which involved development, and the City Council's proposal in its draft Unitary Development Plan, to preserve the open space and playing fields. But in closed session on the 21st January 1993, when both the rugby club's proposal to move to Shadwell and Mr Hartley's close interest in its doing so were alive, it is minuted:

"Further Development in Kirkstall

(Mr Richardson declared an interest in this item).

The chairman introduced a presentation by Kirkstall Valley Properties Ltd in respect of a proposed retail and housing development at Bridge Road, Leeds 4. It was agreed to note the report and to invite Kirkstall Valley Properties Ltd. to submit a planning application."

Such a step was fully in keeping with the proactive role of the Corporation. It also, however, placed Mr Hartley in an entirely unacceptable situation of divided loyalty which, in my judgment, compromised his ability to give objective consideration to the proposed development because of his pecuniary interest in its potential consequences if it were approved by the Corporation.

Mr Drabble contends that any interest of Mr Hartley in the Shadwell proposals was too remote from his functions as chairman of the Corporation to constitute a potentially conflicting interest. He relies in part on a decision of the Commissioner for Local Administration (the 'Local Ombudsman'), who in 1994 rejected a complaint that a member of a corporation (plainly Mr Hartley) had a conflict of interest

"because development may ultimately benefit a Trust of which his family may be beneficiaries. This benefit is said to derive from the relocation of the rugby club: the club hoped to sell to a developer and relocate to land in the green belt close to that owned by the Trust, allowing the Trust to argue for the removal of green belt designation of its land, so increasing the land's value."

The Commissioner considered this interest 'remote and insignificant':

"Any family benefit depends on a sequence of events: planning permission being granted for the rugby club site, the rugby club then being granted planning permission for a stadium on green belt land, the Trust being successful in removing the green belt designation from its land and that de-designation translating into an increased land value. Thus the connection between the outcome of the Corporation's deliberations and the potential gain for family members is not direct. Accordingly I see no reason why an interest should have been declared when the board as considering either the Corporation's response to the allocation of the rugby club site in the Council's draft UDP or the application to develop that land."

It is not necessary for me to consider in detail the relevance to this finding of (a) the Commissioner's remit, which was to consider maladministration, or (b) the fact that the complaint, for some reason, concerned only the Trust's interest and not Mr Hartley's own proprietary interest in the land, or (c) the intrinsic soundness of the Commissioner's reasoning. Her decision does not dissuade me from the view which I have expressed above of the nature of Mr Hartley's personal and pecuniary interest in the redevelopment proposal for the rugby club's land in the Kirkstall Valley.

The problem which Mr Hobson faces, however, is that by the time the decisions which he attacks came to be made, the first and principal one being in July 1994, the rugby club's proposal to move to Shadwell was dead and buried and with it Mr Hartley's pecuniary interest in the grant of planning consent for the club's existing land. Mr Hobson disavows (as he must if he is to come to this court within the time limited by the rules) any direct attack upon the validity of the decisions taken in 1992 and the early part of 1993. Instead he submits that the eventual decisions of 1994 and 1995 in favour of the compromise plan are so contaminated by the undeclared interest of the chairman in these earlier decisions of principle over which he presided that they cannot stand, even if the earlier decisions are themselves now beyond challenge. This is not an illegitimate approach, although any consequential relief might have raised particular questions of discretion; but in order to make it good Mr Hobson has to be able to elongate the reach of the bias test to a point of time where the ground of bias was no longer operative. He seeks to do this, as I have indicated, by pointing out that the eventual decision to allow a modified form of retail development while retaining three sports pitches stands in direct succession to the more ambitious plan for wholesale redevelopment which was actually invited by the Corporation at a meeting with developers chaired by Mr Hartley at a time when he stood personally to gain from the proposal.

Is there then a real danger that the decision of July 1994 to grant planning permission for a modified version of the originally proposed retail development was affected, at the date when it was taken, by the pecuniary interest which had formerly been held by the chairman in the grant of such consent? If I were persuaded that the decision of July 1994 was the product of a prior decision tainted by the participation of a member with an incompatible personal interest, I would consider that a real danger of bias tainted the later decision too. There is moreover force in Mr Hobson's submission that the compromise scheme was no more than a variant of the original tainted scheme, advanced only because the latter had proved untenable on planning grounds.

But, although I reject Mr Ryan's submission that bias cannot infect more decisions than those it has tainted directly, I have been persuaded by Mr Drabble that the compromise scheme which was eventually adopted was a fresh proposal to which the Corporation gave independent consideration. It resulted in a decision which did not depend upon the tainted proposal in a sufficiently substantial way to enable this court to treat the earlier apparent bias as continuing to operate. The material placed before the Corporation and considered by it was both extensive and intensive; it addressed the planning issues and the planning merits without any direct dependence upon or necessary derivation from the original scheme (which was still, at least in theory, separately before the Corporation). I do not say that there was no risk of contamination, or that a reasonable onlooker might not have been suspicious about it; but the evidence does not in my judgment establish a real danger that the 1994 decision was so bound up with the tainted decision of January 1993 that the effect of the chairman's former pecuniary interest was still operative.

(b) John Jackson

Like Mr Hartley, Mr Jackson is a prominent Yorkshire businessman. Among his interests is Centaur Clothes (Manufacturing) Ltd. of which he was managing director and principal shareholder until March 1989 when it was acquired by the William Baird Group plc, a very large company of which Mr Jackson is now Chairman of the Brands Division (which includes Centaur).

Mr Jackson has throughout the material period been a vice-president of the rugby club. (The position is now known as patron, but I will continue to use the term vice-president). He was in attendance at all material meetings of the Corporation, when in Mr Hobson's submission he was disqualified from participating by reason of his association with the rugby club. Mr Jackson for his part deposes that he did not regard his involvement with the rugby club as a material interest which needed to be declared. In this I consider that he is correct.

The evidence shows that a vice-presidency of the rugby club is not as grand as it sounds. For a small uplift in the annual subscription, members can acquire this title and in return be named as vice-presidents on the club programme. The designation carries no active or executive functions: it is entirely honorific. This being so, Mr Hobson has realistically limited his critique to Mr Jackson's (and others') simple membership of the rugby club. This in itself, he argues, is a source of personal loyalty capable of creating what Blackburn J spoke of in R v Rand (1866) LR 1 QB 230, 233, as

"a real likelihood that the judge would, from kindred or any other cause, have a bias in favour of one of the parties."

Association with the rugby club seems in fact to have created a good deal more heart-searching among members of the Corporation than did Mr Hartley's interest in the land at Shadwell. Advice was sought at an early stage from the Corporation's solicitors, Booth & Co. who in May 1990 advised that although a vice-presidency gave a member no pecuniary interest, even contingently on winding-up or on sale of the club's assets, it was wise for members to make a formal declaration I just so that it could never be said that the vice-presidents' interests had not been disclosed and that they unduly promoted the affairs or interests of the club'. In the course of this case a subsequent letter from Booth & Co. written in December 1993, has been traced by the first respondent, and has in turn prompted some further evidence from the Corporation's former chief executive Mr Eagland. It emerges that because Councillor Illingworth, a leading member of the applicant body, had been raising this issue during 1993, further advice had been taken and Booth & Co had now advised that since the Trustees held the club assets on trust for the club members, the latter would have a beneficial interest on dissolution. It followed, in the solicitors, view, that board members who were members of the rugby club should not only declare their interest but take no part in discussion or voting on the application relating to the rugby club's land. Mr Drabble submits, however, and I accept that the ordinary consequence of the failure of the Trust's purposes would be that the assets were distributed cy pres. But whether this is right or wrong, I agree also that the possibility of dissolution of the club and of a consequent distribution of anything significant to the individual members was entirely theoretical and therefore too insubstantial and remote to amount to a possible source of ostensible bias. Applying de Smith's epitome of the cases to which I have referred earlier, membership of the rugby club was no more than association, falling well short of identification, with a party interested in the material planning applications. There was no appreciable danger of bias 'from kindred or other cause'.

Some late evidence was placed before me upon which Mr Hobson further relied, in the form of photographs taken during the hearing and showing an advertisement hoarding for Centaur Tailoring displayed at the perimeter of the rugby club's pitch. Mr Jackson in response has deposed that the sign had a scruffier predecessor in earlier years (there is a dispute as to precisely which years). Assuming in the applicants' favour that Centaur was indeed advertising at the rugby ground at a time when Mr Jackson was attending meetings of the Corporation to consider planning consents for the rugby club's site, I can see no arguable indication of bias in the simple fact that one of his companies was paying a fee (apparently £175 a year) to advertise its goods at the rugby ground. It was a straightforward commercial transaction incapable of creating any inclination which Mr Jackson would not otherwise have entertained in favour of retail development of the ground.

(c) Stuart Kenny

Mr Kenny was at the material time a civil servant in a senior grade with the Department of the Environment, based in Leeds. He was assigned to the nascent Leeds Development Corporation in 1988 to help to set it up, and thereafter was appointed its Commercial Director. He too was a vice-president of the rugby club. He was also, as I have said, a member of the same ward Conservative Association as Mr Hartley and succeeded him as chairman. By analogy with the position of a justices, clerk as analysed by the House of Lords in R v Gough, it is clear that the decisions of a statutory corporation may be vitiated by the participation in them of an officer with a disqualifying bias. Participation in this sense does not, of course, mean discussion and voting: it means the offering of advice which may be slanted by personal or pecuniary interest. In the present case there is no need to consider the exact range and level of Mr Kenny's participation in the impugned decisions, because for the reasons which I have given in relation to Mr Jackson and Mr Hartley, I do not consider that Mr Kenny's membership of the rugby club or chairmanship of the ward Conservative Association were capable, singly or collectively, of having materially influenced him in the advice that he gave to the Corporation. The rugby club interest was too exiguous to matter; the political interest was not logically connected with the planning decisions.

(d) David Richardson

Mr Richardson's relationship with the rugby club and the planning issues was considerably more complex than those of Mr Kenny and Mr Jackson. He was involved also in relation to the Leeds School Sports Association site. But, as will be seen, he regularly and meticulously declared his interests, and the ultimate critique of him is that having declared his interest he failed to absent himself from the material meetings.

Mr Richardson is a chartered surveyor and senior partner in the firm of Wetherall Green and Smith. His knowledge and expertise in relation to property in and around Leeds is plainly considerable, and his advice correspondingly valuable. He had acted in the mid-1980s for the Leeds School Sports Association and thereafter gave them advice free of charge from time to time. He was also a vice-president of the rugby club.

During 1991 the rugby club, which for almost a decade had wanted to move to a better site, set up a working party chaired by Mr Gareth Read to pursue and promote the possibility of relocation. Mr Richardson became a member of this working party. Its purpose, according to Mr Richardson, was 'to look at the possibility of disposing of [the rugby club's] ground and relocating.' He arranged a meeting of interested parties and attended two or three other meetings of the working party. Then, in October 1992, his firm was instructed to represent the rugby club in negotiations with the receivers of an interested development company. When the second respondent eventually purchased the rugby club's ground for £2,225, 000 with the benefit of planning consent, Mr Richardson acted for the rugby club in return for a fee of l% of the price.

There is no doubt in these circumstances that Mr Richardson was right to acknowledge and declare throughout an interest in every item appearing on the Corporation's agenda in relation to the rugby club's site. (Mr Richardson was also, it appears, a member of an informal sub-group of the Corporation, suggested by Mr Hobson to be a kind of inner circle, to whom urgent and routine matters were confided; but there is no evidence that any relevant matters concerning the Kirkstall Valley were decided by this sub-group.)

The importance of declaring an interest lies not in the mere declaration but in what the member then does. In a plain case, where continued presence is itself capable of influencing discussion, the member should leave. If he or she does not do so there is every chance that the court may find a real danger that the member's assumed bias has affected the decision-making process by reason of the member's continued presence. In other cases the relevance of the declaration is that it enables the deciding body itself to consider whether the member, in addition to taking no part in discussion or voting, ought to leave the room. For reasons which I have already considered it will generally be wise to err on the side of leaving.

Mr Richardson was, as it happens, not present at any of the meetings where the impugned decisions were taken in 1994 and 1995. Not one but two questions therefore arise: (a) were the decisions of the meetings where Mr Richardson declared his interest and remained silent but failed to leave vitiated by apparent bias on his part; and (b) if they were, has that bias infected the decisions of the subsequent meetings from which Mr Richardson was absent?

Mr Hobson focuses on the meeting of January 1993 when following a presentation by Kirkstall Valley Properties Ltd. it was decided to invite them to submit a planning application for the redevelopment of the site. Mr Richardson's continued presence, more particularly as he had declared his interest to the other members of the Corporation, will in Mr Hobson's submission have operated as a continuing reminder of his concern that the rugby club's land should benefit by permission for retail development. It was as objectionable, he argues, as the Chief Constable's presence at the meeting of the appeal committee in Cooper v Wilson.

Again I apply the test whether there was a real danger that Mr Richardson's continued presence would influence the decision- making process in favour of the proposal. On balance I think there was such a danger.

There is a further factor which inclines me to the same conclusion. No votes were counted: the chairman proceeded by taking the sense of the meeting. As was held in ex parte Chorley, a councillor who indicates assent is in the same position as a councillor who votes. The danger that a disqualified member who remains present will continue to have influence by his presence is enhanced if at the end of the discussion the chairman records a decision by I reading I the feelings of those who are present rather than by a show of hands. But, as with Mr Hartley, Mr Hobson must go further and show that there was a real danger, that the decisions taken in 1994 and 1995 were infected by the ostensible bias which had entered into the decision-making process in January 1993 by reason of Mr Richardson's presence at a discussion in which he had a disqualifying interest. For the same reasons as in the case of Mr Hartley, I do not think Mr Hobson can succeed in this attempt. The same discontinuity between the two decisions cuts off his attack on the eventual grant of planning consent.

Consequential matters

With the agreement of counsel I have separated Mr Hobson's primary case from the series of discretionary considerations which the respondents would have urged against the grant of relief had I concluded that there was in law and on the facts a case for striking down the eventual grant of planning consent and the reserved matters decision. In the ordinary way, not least because the case may go further, I would have dealt compendiously with all the issues, contingent or not; but because the arguments on discretion were going to occupy days rather than hours, it seemed better to all those concerned that I should first consider the primary entitlement to relief and that only if I judged it to have succeeded should hear the parties out on discretion. In the event this has not been necessary, and I believe that the saving of time and cost is a sufficient justification for taking the course which I have.

For the record, nevertheless, the skeleton arguments indicate that, had it succeeded on the primary issues or any of them, the applicant would have had to deal with the contention that no relief should be granted

(a) because some at least of the issues now raised were known to the applicant as early as November 1993, with the result that there has been waiver or undue delay;

(b) because even though in law the participation of a single disqualified member vitiates a decision, relief can be refused if there is no evidence that non-participation would have made any difference to the decision (relying on R v Governor of Bacon's School, ex parte ILEA [1990] COD.144);

(c) because in the second respondent's submission there had been a material non-disclosure by the applicant of a previous unsuccessful application for judicial review;

(d) because the effect of the attack on the later decisions is to subvert earlier decisions which are now beyond the reach of judicial review;

(e) because, the Commissioner for Local Administration having already considered many of these issues, they should not now be re-agitated; and

(f) because the second respondent has purchased the land on the faith of the planning consent granted by the Corporation and should not be deprived of the fruits of a purchase made for full value and in good faith. In the circumstances it is unnecessary for me to evaluate any of these submissions. The application for judicial review fails not in discretion but on its merits.

Inconsequential matters

The consent which was given was expressed in part in imperial units. Directive 80/181/EEC of the Council of the European Communities of 20th December 1979, as amended by Directive 89/617/EEC of the 27th November 1989, requires member states by the end of 1994 to have adopted as their legal units of measurement the metric equivalents of imperial measure. Mr Hobson has been understandably diffident about what I ought to make of this not very dramatic breach of the law. He prays it in aid of his submission that the grant of consent was made in haste in order to assist the rugby club before the Corporation was wound up; but this, I think, is fanciful. There is no doubt, however, that paragraph 25 of the formal grant of outline planning permission, issued on the 2nd February 1995, ought to have expressed the areas of permitted development in square metres rather than square feet. The remainder of the grant does duly express distances in metres.

What I will do, therefore, if anybody wants me to, is declare that in paragraph 25 of the grant the figures expressed in square feet are to be regarded as having been multiplied by 0.0929 and expressed in square metres. Admittedly a factor of 0.0929 is an ellipsis of the full formula contained in Chapter III of the Annex to the 1979 Directive, which requires the application of a factor of 0.929 x l0-l but for those educated on this side of the English Channel I trust that it represents a sufficient compliance with the obligations created by the European Communities Act 1972.

MR DRABBLE: My Lord, I have three consequential points that arise. My Lord, the first is an application for costs against the Applicants. The second is to respond to what your Lordship has just said about metrification, by indicating that there is no need for declaration in the form that your Lordship has suggested, because there is, if your Lordship wishes to see it, a piece of subordinate legislation called the Units of Measurement Regulations 1995, the effect of which is to -- as a matter of English law, any existing document in the development of metric units and so accordingly, without your Lordship's declaration, the planning permission would be in the relevant units. I do not know if your Lordship wishes to see it----

MR JUSTICE SEDLEY: No, I do not. You could have whipped the rug from under Mr Hobson during argument with that one, Mr Drabble.

MR DRABBLE: Absolutely right -- even if it was a matter of hard law.

MR JUSTICE SEDLEY: There is no need for the declaration then.

MR DRABBLE: The third point was - if I can just indicate at page 49 of the judgment, your Lordship referred at the very foot of the page to a planning application in April 1993, and described it as "the compromise scheme".

MR JUSTICE SEDLEY: That was the comprehensive scheme.

MR DRABBLE: Yes, as becomes apparent from page 50.

MR JUSTICE SEDLEY: My error is because, an earlier and truly comprehensive scheme had been on the books at the turn of the decade. Thank you very much. If that is the only error of fact I am very relieved, perhaps Mr Ryan has others.

MR RYAN: My Lord, may I mention two matters in the judgment. on page 71, under the heading "consequential matters", six lines down, your Lordship has referred to "related matters decision". From what we understand in this Court and to what your Lordship is referring, I am not being generally understood. I wonder if your Lordship would consider calling it, as I think it was, "the related approval of reserve