Singh v Secretary of State for the Environment and another

Compulsory purchase — Compulsory purchase order made under section 43 of Housing Act 1974 — Application under section 23 of Acquisition of Land Act 1981 to quash order — Appeal from decision of Mann J (as he then was) rejecting application — Suggestion that a stricter test than the Wednesbury/Ashbridge principles should be applied to determine the validity of a compulsory purchase order on the ground of its draconian nature, dispossessing a private citizen of his home — There had been the usual public inquiry and an inspector’s report, accepted by the Secretary of State, which recommended confirmation of the order — The property, which was in a housing action area, was a three-storey house in multiple occupation, none of it self-contained — It was occupied by the applicants and by tenants — For some time before the purchase by the applicants in 1984 it had been in a dilapidated condition, requiring substantial repairs and calling for some kind of subdivision The local authority claimed that, despite the applicants’ statement of intention, no progress had been made towards completion of the necessary works and that the making of the proposed order was essential to ensure that they were carried out — Applicants asserted that they had a clear intention to repair and convert, that they could obtain the necessary finance and that they would make arrangements to rehouse the tenants temporarily — The inspector accepted that the applicants’ proposals, if implemented, for a three-flat conversion would be more likely to secure the well-being of the occupants than the authority’s two-flat scheme, but the applicants’ proposals had been put forward only during the course of the inquiry and there was no certainty that they would be put into effect — The inspector recommended confirmation of the order, noting that the authority would not seek to enforce it if satisfied with the progress of the works — The Secretary of State agreed and expressed the hope that it would not in fact become necessary to deprive the applicants of their property — Mann J rejected an application to quash the order and the applicants appealed The appellants submitted that the findings showed that their proposals would achieve the authority’s objectives more economically than a compulsory purchase order, which would in any case make it difficult or impossible to raise the necessary mortgage finance — The appellants also argued, on the basis of some recent decisions, that, in reviewing the confirmation of a compulsory purchase order, special requirements, more stringent than the Wednesbury/Ashbridge principles, were applicable and that these requirements had not been satisfied — In any case, the appellants claimed that the confirmation in the present proceedings did fail to satisfy the Wednesbury/Ashbridge principles, as it was irrational and manifestly unreasonable — In rejecting all these submissions, the court referred to the case of de Rothschild and Eranda Herds Ltd v Secretary of State for Transport [1989] 06 EG 123, where the same argument as to the existence of special rules governing the confirmation of compulsory purchase orders was put forward, considered at length by the Court of Appeal and dismissed — It was therefore clear that any challenge must be based on the Wednesbury/Ashbridge rules — Appeal dismissed The following cases are referred to in this report. Ashbridge Investments Ltd v Minister of Housing and Local Government [1965] 1 WLR 1320; [1965] 3 All ER 371; (1965) 63 LGR 400; [1965] EGD 216; 195 EG 205, CA Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223; [1947] 2 All ER 680, (1947) 45 LGR 635, CA Brown v Secretary of State for the Environment (1978) 40 P&CR 285; [1979] JPL 454 Chilton v Telford Development Corporation [1987] 1 WLR 872; [1987] 3 All ER 992; [1987] 1 EGLR 12; (1987) 281 EG 1443, CA de Rothschild v Secretary of State for Transport [1989] 1 EGLR [1989] 06 EG 123 Prest v Secretary of State for Wales (1982) 81 LGR 193; [1983] EGD 282; 266 EG 527, [1983] 1 EGLR 17, CA R v Secretary of State for the Environment ex parte Melton Borough Council (1985) 52 P&CR 318; [1986] JPL 190 This was an appeal by Sarup Singh and Agia Kaur Singh, his wife, from the decision of Mann J rejecting an application to quash a compulsory purchase order made by the London Borough of Hackney in relation to the appellants’ property at 2 Holmdale Terrace, London N15. Barry Payton (instructed by Clinton Davis & Co) appeared on behalf of the appellants; N Pleming (instructed by the Treasury Solicitor) represented the first respondent, the Secretary of State for the Environment; the second respondents, the London Borough of Hackney, were not represented and took no part in the proceedings. Giving the judgment of the court, KERR LJ said: This is the judgment of the court on an appeal from a judgment given by Mann J (as he then was) on December 8 1987, whereby he rejected an application under section 23 of the Acquisition of Land Act 1981 to quash the confirmation by the Secretary of State for the Environment of a compulsory purchase order (CPO) made by the London Borough of Hackney pursuant to section 43 of the Housing Act 1974. The council was not represented below or before us. The applicants claim that the confirmation of the CPO was invalid in the light of favourable findings in an inspector’s report, following a public inquiry held pursuant to section 13(2) of the 1981 Act. It was said that these demonstrated that the owner’s proposals for the conversion and repair of the property would achieve the council’s objectives better and more economically in terms of public money than the acquisition of the premises under a CPO. Accordingly, given the draconian nature of a CPO, it was said that the onus of justifying the necessity for it had not been discharged and that its confirmation was invalid. There were also other issues about the effect of undertakings given by local authorities not to enforce a CPO so long as the necessary work is done by the owner to its satisfaction; in particular, these were said to be unrealistic in the face of the problem of borrowing the necessary funds for doing the work on the security of a property which is subject to a CPO. In 1982 the Hackney ‘West Bank Housing Action Area’ was declared pursuant to section 36 of the 1974 Act. On July 25 1984 the council resolved to make a CPO covering six dwelling-houses in the area. The present proceedings concern 2 Holmdale Terrace, N15. In September 1984 the applicants agreed to purchase the property, and completion took place on November 6 1984. They say that they were then aware that it was situated in a housing action area (HAA) but that they were unaware of the resolution for the CPO covering it, since this was only sealed and published on June 18 1985 as the London Borough of Hackney (West Bank Housing Action Area) (No 3) Compulsory Purchase Order 1984. Following objections to the CPO, a public inquiry was held by Mr R G Bromiley BArch ARIBA on October 30 and 31 and November 1 1985. His report to the Secretary of State was dated December 2 1985 and recommended confirmation of the CPO in relation to all the properties covered by it. That recommendation was accepted by the Secretary of State in a decision letter dated February 17 1986. The present application to quash the CPO, which Mann J rejected, relates solely to 2 Holmdale Terrace. This is a three-storey, double-fronted house in multiple occupation, of which none is self-contained. It is common ground that the property has been in a dilapidated state for a long time, that substantial repairs are urgently needed, and that it should be subdivided into two or three self-contained units. We must then set out the relevant statutory provisions, beginning with Part IV of the Housing Act 1974. This has since been consolidated in Part VIII of the Act of 1985, but nothing turns on this. 36.–Declaration of housing action areas 38 (1)  Where a report with respect to an area consisting primarily of housing accommodation is submitted to the local authority within whose district the area lies by a person or persons appearing to the authority to be suitably qualified (whether or not that person is or those persons include an officer of the authority) and, upon consideration of the report and of any other information in their possession, the authority are satisfied that, having regard to — (a)   the physical state of the housing accommodation in the area as a whole, and (b)   social conditions in the area, the requirement in subsection (2) below is fulfilled with respect to the area, the authority may cause the area to be defined on a map and by resolution declare it to be a housing action area. (2)  The requirement referred to in subsection (1) above is that the living conditions in the area are unsatisfactory and can most effectively be dealt with within a period of five years so as to secure — (a)   the improvement of the housing accommodation in the area as a whole, and (b)   the well-being of the persons for the time being residing in the area, and (c)  the proper and effective management and use of that accommodation, by declaring the area to be a housing action area. 43.–Acquisition of land in housing action areas (1)  Where a local authority have declared an area to be a housing action area then, for the purpose of securing or assisting in securing all or any of the objectives specified in paragraphs (a) to (c) of subsection (2) of section 36 above, — (a)   they may be authorised by the Secretary of State to acquire compulsorily any land in the area on which are situated premises which consist of or include housing accommodation, and (b)    to the extent that they could not do so apart from this subsection, they may acquire any such land by agreement. The other relevant provisions are to be found in the Acquisition of Land Act 1981, as follows: 13.–Confirmation of order (1)  If no objection is duly made by any such owner, lessee or occupier as is mentioned in section 12 above, or if all objections so made are withdrawn, the confirming authority, upon being satisfied that the proper notices have been published and served, may, if the confirming authority thinks fit, confirm the order with or without modifications. (2)  If any objection duly made as aforesaid is not withdrawn, the confirming authority shall, before confirming the order, either cause a public local inquiry to be held or afford to any person by whom any objection has been duly made as aforesaid and not withdrawn an opportunity of appearing before and being heard by a person appointed by the confirming authority for the purpose, and, after considering the objection and the report of the person who held the inquiry or the person appointed as aforesaid, may confirm the order either with or without modifications. 23.–Grounds for application to High Court (1)  If any person aggrieved by a compulsory purchase order desires to question the validity thereof, or of any provision contained therein, on the ground that the authorisation of a compulsory purchase thereby granted is not empowered to be granted under this Act or any such enactment as is mentioned in section 1(1) of this Act, he may make an application to the High Court. (2)  If any person aggrieved by — (a)  a compulsory purchase order, or (b)  a certificate under Part III of, or Schedule 3 to, this Act, desires to question the validity thereof on the ground that any relevant requirement has not been complied with in relation to the order or certificate he may make an application to the High Court. (3)  In subsection (2) above ‘relevant requirement’ means — (a)   any requirement of this Act, or of any regulation under section 7(2) above, or (b)   any requirement of the Tribunals and Inquiries Act 1971 or of any rules made, or having effect as if made, under that Act. . . . 24.–Powers of the court (1)  On an application under section 23 above the court may by interim order suspend the operation of the compulsory purchase order or any provision contained therein, or of the certificate, either generally or in so far as it affects any property of the applicant, until the final determination of the proceedings. (2)  If on the application the court is satisfied that — (a)   the authorisation granted by the compulsory purchase order is not empowered to be granted under this Act or any such enactment as is mentioned in section 1(1) of this Act, or (b)   the interests of the applicant have been substantially prejudiced by any relevant requirement (as defined in section 23(3) above) not having been complied with, the court may quash the compulsory purchase order or any provision contained therein, or the certificate, either generally or in so far as it affects any property of the applicant. At the public inquiry the parties represented before the inspector were the council, the tenants in occupation, and the applicants, who also occupied the property, together with members of their family. The inspector made a full and detailed report which set out the relevant matters with great clarity. On behalf of the applicants, Mr Payton relied exclusively on some of the passages headed ‘Findings of Fact’ relating to this property (para 63(7) to (19)) and on some of the passages headed ‘Conclusions’ relating to this property (paras 64 and 65). He then criticised the recommendation in the following para (66), to confirm the order in the light of these passages. In our view, such an analysis of the inspector’s report is too truncated and selective. In deciding whether or not to accept the inspector’s recommendations and to confirm or decline to confirm a CPO, the Secretary of State is bound to make a value judgment which will take account of the report as a whole. There is therefore every reason for the court to take the same course in determining whether or not there are any grounds for quashing the Secretary of State’s decision. For both purposes it is right to have regard to all parts of the report which may assist. The passages containing findings of fact and conclusions are no doubt of paramount importance. But assistance may also be gained by viewing them against the background of other parts, including the recitals of factual background and the contentions of the parties. So long as these are not inconsistent with the findings of fact or clearly controversial, they may assist in putting the inspector’s findings and conclusions into better perspective. We make these observations because from time to time it appeared to be suggested by Mr Payton that the court was bound to confine its attention to the passages on which he relied, as mentioned above. We do not accept this. However, had we done so, our ultimate conclusion would not have been different, although we might have had greater difficulty in reaching it. In the event, however, on behalf of the Secretary of State, Mr Pleming drew our attention to other parts of the report which were not inconsistent with the findings of fact and uncontroversial, and which we found of considerable assistance. In summarising or setting out passages from the report we therefore adopt this approach. The report begins by stating the council’s objectives for the West Bank HAA. These included all three of the matters referred to in (a), (b) and (c) of section 36(2) of the 1974 Act, and the report states the reasons why all these paragraphs are claimed to be applicable to this HAA. In relation to the six properties comprised in the CPO, though bearing in mind that the order predated the acquisition of 2 Holmdale Terrace by the applicants, the report stated: At the time of making the order it was apparent that the owners were unable or unwilling to achieve the objectives of the HAA in relation to these properties. Accordingly the Council have instigated the order so as to secure those objectives. The report went on to record that at the time of the inquiry the council’s intentions concerning the conversion and improvement of this particular property were to convert it to one three-bedroom maisonette and one two-bedroom flat. We then set out paras 15 and 16: 15  Since the order was made the situation of some individual properties has changed — either because of a change of ownership and/or because proposals for repairs and improvements have been submitted and/or works are in progress. Further details are set out in the cases relating to the individual properties. In general although the purpose of the order is to secure the objectives of the HAA, it is the Council’s practice to recommend the exclusion of houses from the order where owners themselves achieve those objectives. The Council are also prepared to give undertakings in appropriate cases that the order if confirmed will not be implemented provided that: (a)   substantive proposals have been received prior to the public local inquiry; and (b)   the Council’s requirements for the property are rapidly and effectively met by the owner. The specific undertakings which the Council consider appropriate are set out in the individual cases. 16  Nevertheless the Council have much experience of the consequences of failure by owners to carry out and complete works even when it has appeared to be certain that the objectives would be achieved. Such failures are extremely serious in their effects on the conditions in which tenants have to continue to live on the need to take enforcement action and/or on the postponement or even abandonment of the achievement of the objective within the lifespan of the HAA. Subject to the detailed cases which follow, the Council consider that confirmation of the order in respect of all the properties included is necessary in order that those objectives can be achieved. The position in relation to this property, as will be seen hereafter, is that no substantive proposals were put forward before the inquiry, but a number of substantive proposals were put forward in the course39 of it. These were reflected in the inspector’s findings of fact, to which we come shortly. Next, we set out the case for the council relating to this property as summarised in the report: 17  This property has been in very poor repair for a number of years and is in need of substantial works of repair and improvement to bring it up to the standard to meet the Council’s objectives. Two tenants have lived there for more than 10 years. Last year the house was purchased by its new owner, who has moved in to the second floor accommodation with his family. 18  The Council wrote to the (then) managing agent in January 1983 (Document 3/1/16) and sent a schedule of major works required in September 1983 (Documents 3/1/17 and 18). No satisfactory reply was received, and in March 1984 the owners were advised that a compulsory purchase order was to be recommended (Document 3/1/3). Full details of the various actions and correspondence by the Council are submitted (Documents 3/1/1 to 25). 19  Following acquisition by the next owner, a scheme was drawn up for three units, but the provision for the existing tenants was unacceptable to them. Negotiations were commenced for the tenants to buy the property; but at the end of September 1984 it was sold again. 20  A meeting with the present owner was held on November 21 1984. A revised scheme was prepared by the owner’s architect which provided 2 bedroom flats for both tenants which were self-contained but rather cramped; the tenants were unable to agree to the proposals (Document 3/1/33). No further progress has been made since then. 21  The condition of the property as a whole and of its parts has remained substantially the same as it was 2 1/2 years ago. Despite the new owner’s expressed intentions no application for planning permission to convert the property has yet been made, nor have any satisfactory arrangements for rehousing the existing tenants — temporarily or permanently — been made. The tenants have complained of failure on the part of the owner to keep clean the common parts. There is no present certainty that the Council’s objectives for the HAA will be achieved in respect of this property. 22  If the Council acquire this property they intend to improve and convert it to provide 1 x 3 bedroom maisonette and 1 x 2 bedroom flat. The Council would rehouse the existing tenants temporarily or permanently as appropriate, and the works would be included in the rehabilitation programme and be accorded high priority. The following paragraph is headed ‘Case for the Tenants’. 23  The two separate households of Mr Salih and Mr Carnegi have experienced a succession of landlords over the past 10 years or more. The present owner is putting forward proposals which would interfere with their occupation of the property. They have every right to resist these proposals which would result in a loss of valuable space; but they are criticised for doing so and relationships between the owner and the tenants are not happy. At the time he purchased the property the owner knew that it was within a HAA (Document 3/1/32). Although it is claimed that he was not aware of the resolution to make the compulsory purchase order, ignorance is not a valid reason for his not carrying out a search which would have disclosed that fact. Without the compulsory purchase order it is highly unlikely that any repairs and improvements will be carried out to this property. The Council’s case is supported. Finally, on this part of the inspector’s report, we should set out the whole of the ‘Case of the Objector’, ie of the applicants: 24  Having previously lived with parents in overcrowded conditions in N5, the owner took the opportunity to buy this house at auction in September 1984. Even though when he bought the property he had no specific intention of converting it, he now has every intention of doing so in accordance with the plan submitted (Document 3/1/33) to provide 1 x 2 bedroom and 2 x 3 bedroom flats. Comparison with the accommodation which exists (Document 3/1/24) demonstrates that the total floor area would exceed that existing and the accommodation available for the two tenants would be substantially the same in floor area and in numbers of habitable rooms, but the accommodation would be better and more conveniently arranged, self-contained, and with integral bathroom and toilet accommodation for each flat. 25  The owner has access to the finance to carry out the necessary works of repair, conversion and improvement to the property subject to the availability of grant of up to £12,000 for each flat. (Documents 3/1/29 to 31.)  Although he has made no arrangements for rehousing the tenants while the works are being carried out, he would be able and willing to move his own family out temporarily and would be prepared to sign any necessary agreement to secure that the existing tenants could return to their improved accommodation, or for transferring nomination rights for the tenancies of the flats to the Council. 26  The present tenants are not being fair or reasonable in rejecting what is now proposed. The Council assert that a principal aim is to safeguard the interests of households who move into the area during its life as a HAA as well as those already living there at the time of declaration. They granted planning permission for conversion of the property into 2 x 2 bedroom flats and 1 x 1 bedroom flat in 1984, and in so doing they accepted the principle of conversion into 3 separate units. Nevertheless the Council are now supporting the tenants in their unreasonable stance. In so doing they are in effect discounting the rights of the owner’s family to remain in the property in improved accommodation and are rejecting one of their own principal aims. The only way in which they justify that is by referring to him by the epithet ‘landlord’ — instead of recognising him as the owner and part occupier. 27  If the Council were to proceed to acquire the property and convert it into two flats in accordance with their Statement of Reasons, that would be at the cost of £107,300. If the owner is allowed to proceed with his proposals, the maximum cost to the public purse would be £36,000–that is £12,000 for each of three flats. The difference of £71,000 could not be justified in terms of gain in the improvement of housing accommodation, or of the well-being of persons residing in the area, or of the need to secure the proper and effective management or use of the accommodation. 28  The order should not be confirmed. The owner should be encouraged to carry out the works of repair, conversion and improvement in accordance with his intentions, and the Council should assist by making temporary rehousing facilities available for the tenants. However, if the tenants will not co-operate satisfactorily with the improvement proposals or accept rehousing to enable conversion to proceed the owner would not seek to coerce them — in those circumstances he would proceed to carry out those works which would qualify for a mandatory grant. There then follows a detailed and extensive description of the unsatisfactory condition of the property. It is unnecessary to set this out, but it is clear that it is in urgent need of substantial repairs and conversion. We then turn to the section of the report headed ‘Findings of Fact’. Para 63 made a number of findings which apply generally to the HAA and to all six properties comprised in the CPO. We set out three subparas as follows: 4  The objectives of the HAA are to secure the improvement of the housing accommodation, the well-being of the persons for the time being residing in the area, and the proper and effective management and use of that accommodation. 5  In pursuing these objectives the Council have made owners of substandard properties aware of the Council’s requirements for bringing those properties up to standard and have provided information as to the assistance which would be available. 6  The properties included in this order have remained in varying conditions of disrepair and in need of improvements; some are partly or wholly occupied and the well-being of the occupants for the time being living there is not secure. Next we set out in full the subparas dealing with this property: REFERENCE 1-2 HOLMDALE TERRACE 7  This house is occupied by 3 separate family households, none of which is in self-contained accommodation. 8  No household has exclusive use of a bath or an internal water closet. 9  The house is in disrepair and is partly damp, poorly lit by daylight and poorly ventilated in part. 10  It is in need of repairs and improvements. 11  The present owner purchased the house at auction in September 1984, knowing that it was situated in a Housing Action Area. 12  He intends to carry out works of repair and improvement to the property as a whole and to convert it into 3 self-contained units of accommodation. 13  He has access to finance sufficient to carry out the works, provided that grant assistance is made available up to £12,000 per unit — £36,000 in all. 14  Plans have been drawn up for the works which would provide for the existing tenants to retain the same number of rooms as they at present occupy, but arranged differently. 15  Planning permission would be required therefor, but a planning application has not yet been submitted. 16  The existing tenants do not agree with the works of improvement and conversion as proposed. 17  Arrangements for rehousing them temporarily or permanently have not been made. 18  Application for improvement grant has not been made or approved. 19  Lacking the consent of the existing tenants and satisfactory housing arrangements being made, the Council do not consider that the present proposals would secure the well-being of the persons for the time being residing there. Finally we set out in full the paragraphs headed ‘Conclusions’ dealing with this property: Bearing in mind the above facts, I am of the opinion that: REFERENCE 1-2 HOLMDALE TERRACE 64  Although it is not at issue between the parties that the property has been in disrepair and in need of improvement for a number of years, the present owner purchased it — with the intention of his own family occupying part of it — only one year ago. Some mention has been made of a bad atmosphere between the three households who occupy different parts of the house and of the owner’s failure to keep the common parts clean — but the evidence is not sufficient to demonstrate that the proper and effective management or use of the accommodation could not be secured if the house were to remain in its present ownership. The owner’s proposals to convert the property into three self-contained units of accommodation being 1 x 2 bedroom and 2 x 3 bedroom flats would be more likely to secure the well-being of the persons for the time being residing in the area — including the owner’s family — than the Council’s which would necessitate the removal of the latter. I accept that the tenants do not welcome the present proposals wholeheartedly; but they would derive substantial benefits from the units of accommodation being made self-contained and provided with the exclusive use of the standard amenities for each household, even though the useable space in two or more of the living rooms would be diminished. 65  If the decision as to the confirmation of the compulsory purchase order as it affects this property depended solely on the acceptability or otherwise of the owner’s proposals, given goodwill from all parties and with the co-operation of the Council in providing help with temporary or permanent rehousing, the proposals could be adjusted sufficiently to overcome the difficulties which the tenants perceive. However, it is clear that the Council have been striving for some time with the previous owners of the property to secure improvement of the accommodation, only for it to be sold before the works were commenced. That should not be attributed as a fault on the part of the present owner; but the proposals put forward at the inquiry are no more certain of being put into effect than other proposals have been. The owner has not obtained planning permission; he has not obtained the consent of the tenants; he has not made arrangements for rehousing; and he has not yet applied for or received approval of improvement grant. 66  In these circumstances I do not see that the Council have any alternative but to pursue confirmation of the order. They have stated that they will not seek to enforce an order even if confirmed when they are satisfied with the progress of works towards completion. In the light of the owner’s comparatively recent purchase of the property and his clear intention to improve and convert it, it is to be hoped that the Council would offer him every assistance in trying to reach a satisfactory conclusion without enforcing acquisition in this case. Nevertheless they should be in the position of being able to step in and acquire the property without having to undertake further legal proceedings if satisfactory progress is not made and maintained. 67  Acquisition is justified in order to secure the improvement of the housing accommodation and the well-being of the persons for the time being living there. We then come to the decision letter on behalf of the Secretary of State. It is accepted that this contains an accurate review of the material parts of the inspector’s report. The decision is contained in para 10 of the letter. We set this out in full, but with one sentence in brackets. This relates to another property comprised in the order, but is also of some interest in the light of some of the matters discussed on this appeal. 10  The Secretary of State has given careful consideration to the Inspector’s report and to the submissions of the parties. He accepts the Inspector’s findings of fact and agrees with his conclusions. The Secretary of State has noted the alternative proposals of Mr Singh to convert the property Reference 1, or, depending on the attitude of the tenants, to carry out works which would attract mandatory improvements grant. He also notes that Mr Singh and his family reside in the property and wish to continue to do so. The Secretary of State would hope that in the circumstances it might be possible for Mr Singh and the Council to find a solution which would enable the objectives of the Housing Action Area to be met without depriving him of his home. (The Secretary of State also notes that works on the property Reference 6 are substantially complete: and would expect the Council not to implement the order if works are completed.)  The Secretary of State nevertheless considers the compulsory purchase order justified to achieve the objectives of the Housing Action Area. For these reasons he has decided to accept the Inspector’s recommendation and to confirm the London Borough of Hackney (West Bank Housing Action Area) (No 3) Compulsory Purchase Order 1984. The confirmed order is being forwarded under separate cover. We then return to Mr Payton’s submissions as indicated in outline at the beginning of this judgment. His main submission was double-barrelled. First, he relied on the findings in subparas 12, 13 and 14 of para 63, and on the first sentence of para 65 in the ‘Conclusions’, as well as on the later references in that and the following paragraph to the fact that the present owner cannot be held responsible for what had happened — or had failed to happen — until his comparatively recent purchase of the property and to ‘his clear intention to improve and convert it’. Mr Payton said that findings of this nature, being highly favourable to an owner seeking to resist a CPO, were in his experience most uncommon. Their effect was that, from the point of view of all concerned, the carrying out of the works by the owner would be greatly preferable to the implementation of the CPO, since it would save the cost of acquiring, repairing and converting the property at public expense. Mr Payton suggested that, given the financial stringencies and other priorities in Hackney, it was doubtful whether confirmation of the CPO would in fact achieve anything in the near future, whereas — on the findings of fact — there could be no doubt that the applicant was ready, able and willing to carry out the work with all diligence. He offered an undertaking to that effect on behalf of the applicant, which had also been mentioned to Mann J. As regards the tenants in occupation, he said that it would make no difference to them, since they would have to be ‘decanted’ in any event, but that the offered undertaking included a promise to allow the same tenants to return to the premises, or that the owner would enter into a ‘nomination agreement’ with the council to the effect that the accommodation not required for him and his family would be available to persons nominated from their housing lists. On the other hand, it was claimed that the maintenance of the CPO, even if not implemented by actual acquisition of the property, would render it impossible for the owner to raise the necessary finance to carry out the works, since no mortgagee would advance funds on the security of a property which was subject to a CPO. This latter point was not mentioned at the inquiry or dealt with in the report. It raises different considerations and is therefore better discussed separately at the end. Mr Payton’s second submission sought to reinforce the first. Given the unusually strong position of the applicants on the inspector’s findings of fact, he submitted that the confirmation of the CPO was wrong on the basis of the Wednesbury/Ashbridge principles, to which we refer below. Moreover, while these principles were applicable to the judicial review of administrative or executive decisions in general, he said that, in the context of CPOs, a higher standard fell to be applied by the courts on the ground that CPOs involve the compulsory acquisition of private property against the wishes of the owners and occupiers. Since acceptance or rejection of this submission must colour the proper approach to Mr Payton’s primary submissions on the facts, it is convenient to deal with it first. The thrust of the argument was that in reviewing executive orders confirming CPOs, the court should apply a stricter test to their legal validity than that which emerges from the well-known Wednesbury/Ashbridge principles, ie those laid down by this court in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 and Ashbridge Investments Ltd v Minister of Housing and Local Government [1965] 1 WLR 1320. These are too well known to require restatement and can properly be assimilated. Thus, although Ashbridge was concerned with a CPO, in setting out the grounds on which the court can interfere with the minister’s decision in such cases, at p 1326H Lord Denning MR concluded by saying: It [the power to interfere] is identical with the position when the court has power to interfere with the decision of a lower tribunal which has erred in point of law. But Mr Payton nevertheless sought to rely on other cases dealing with CPOs which, as he claimed, showed that the powers of judicial review were wider in relation to them because they involve the compulsory acquisition of private property and have often understandably been referred to as draconian. He relied on the decisions of Forbes J in Brown v Secretary of State for the Environment (1978) 40 P&CR 285 and in R v Secretary of State for the Environment, ex parte Melton Borough Council [1986] JPL 190 and on the decisions of this court in Prest v Secretary of State for Wales [1982] 81 LGR 193 and Chilton v Telford Development Corporation [1987] 1 WLR 872. We do not find it necessary to examine these cases, because this line of authority, and the very point which Mr Payton sought to establish, was recently considered at length in a decision of this court given on July 12 1988 which is not yet reported: Evelyn de Rothschild v Secretary of State for Transport and Bedfordshire County Council*. The case concerned a CPO which was confirmed by the Secretary of State for the acquisition of part of the applicant’s land for the purpose of constructing a bypass in relation to which the objectors had suggested alternative routes. The central issue turned on a sentence in the inspector’s report recommending confirmation of the CPO on the basis of the route over the applicant’s land which was preferred by the local authority. The inspector said that there were no factors which outweighed the disadvantages of extra cost and exceptional delay which would result from the objectors’ alternative routes, and that in his view the local authority had shown that its route was best in the public interest. The Secretary of State accepted the recommendation, affirmed the order, and this court dismissed an appeal from the refusal of Mann J to quash this decision. The leading judgment was given by Slade LJ, reviewing the authorities which we have mentioned, with which Ralph Gibson LJ agreed, and there was also a short concurring judgment by Croom-Johnson LJ. *Editor’s note: Now reported at p 19 ante. On this appeal Mr Payton sought to distinguish or neutralise that40 decision on two grounds. First, he pointed out that the inspector’s recommendation in that case, which we have already summarised, was adverse to the objectors, whereas in the present case the important findings were favourable. That is certainly a difference between the two cases which should be noted when we come to deal with the inspector’s report in the present case. Second, Mr Payton submitted that the detailed review of the authorities in that case was wholly obiter, because at the end of the day everything turned on the interpretation or evaluation of that passage in the inspector’s report. In our view, that submission is quite untenable. It is perfectly clear, just as it is in the present case, that on that appeal the court felt it necessary to begin by considering the appropriate test which falls to be applied upon an application for judicial review of a confirmation of a CPO. The judgments in the de Rothschild case demonstrate that the court considered that its analysis of the law was necessary for the decision, and that it formed part of the ratio of the judgments. We are accordingly bound by what was said in that case, with which we would in any event respectfully agree. At p 4B of the transcript Slade LJ said: On behalf of the appellants, Mr Sullivan and Mr Ash have submitted that there are to be derived from the authorities what they call ‘special rules’, beyond the Wednesbury/Ashbridge grounds, which are applicable whenever the court is considering a challenge to a compulsory purchase order. They summarise these so-called special rules in five propositions as follows (I am quoting from their skeleton argument): ‘(i)  The onus is upon the acquiring authority to justify a compulsory purchase order and upon the Secretary of State to justify his decision to confirm such an order. (ii)  A compulsory purchase order should only be confirmed if it is decisively in the public interest to do so, or if there is a ‘compelling case’ in the public interest. (iii)  Any reasonable doubt as to the justification for a compulsory purchase order is to be resolved in favour of the owner of the affected land. (iv)  If alternative land is available that is equally suitable for the purposes of the acquiring authority but which can be acquired without the use of compulsory purchase powers, the use of such powers cannot be justified. (v)  At the very least it is for the acquiring authority to demonstrate that compulsory acquisition is necessary and not for the landowner to demonstrate the converse.’ By way of support for these five propositions, the appellants’ counsel referred to general principles of our constitutional law, including the Magna Carta and Article 1 of the First Protocol to the European Convention of Human Rights. More specifically, they relied on three reported cases. The judgment then discussed the decisions in Brown, Prest and Melton BC, to which we have already referred, and went on as follows at p 10E: I think that the word ‘necessary’ itself carries with it an element of ambiguity and uncertainty and I would prefer to avoid it in this context. It does not appear in section 13(2) of the 1981 Act and Mr Sullivan expressly disclaimed any submission that it should be read into the subsection by a process of implication. In answer to his and Mr Ash’s submissions as to ‘special rules’, I summarise my conclusions thus. First, I do not accept that any special rules beyond the ordinary Wednesbury/Ashbridge rules fall to be applied when the court is considering a challenge to the Secretary of State’s confirmation of a compulsory purchase order. Second, however, the Secretary of State, as Mr Laws on his behalf accepted and submitted, must be satisfied that the compulsory purchase order is justified on its merits before he can properly confirm it. He must not exercise his powers capriciously. Given the obvious importance and value to landowners of their property rights, the abrogation of those rights in the exercise of his discretionary power to confirm a compulsory purchase order would, in the absence of what he perceived to be a sufficient justification on the merits, be a course which surely no reasonable Secretary of State would take. I think that this approach to the matter reconciles the judgments in Prest with the ordinary principles of our law applicable to claims for judicial review. Furthermore, it has the merit of avoiding any reference to onus of proof, which is an expression more appropriate, as Mr Laws pointed out, to a lis inter partes. As Lord Denning observed in Prest itself (at p 200), the Secretary of State’s decision certainly is not a lis inter partes. As he said: ‘It is a public inquiry — at which the acquiring authority and the objectors are present and put forward their cases — but there is an unseen party who is vitally interested and is not represented. It is the public at large. It is the duty of the Secretary of State to have regard to the public interest.’ In making his decision, there are a multitude of different factors which the Secretary of State has to take into account. To mention only a few; questions of landscape and other amenity, feasibility, cost and delay. To talk of questions of onus of proof when so many competing factors have to be taken into the balance seems to me not only inappropriate but a somewhat difficult concept. The judgment then went on to deal with the facts and returned to the foregoing analysis of the legal position in answer to the submissions made on behalf of the appellants, thereby making it perfectly clear that this analysis formed part of the ratio of the decision. Slade LJ said at p 17A: For reasons which I have already explained, I do not think that any special rules fall to be applied by us beyond the Wednesbury/Ashbridge rules when the court is considering a challenge to the confirmation by the Secretary of State of a compulsory purchase order. However, I have also already accepted that, given the draconian nature of such an order, no reasonable Secretary of State would be likely to confirm such an order in the absence of what he perceived to be a sufficient justification of his decision on its merits. As already mentioned, Ralph Gibson LJ agreed with Slade LJ, as did Croom-Johnson LJ, but it is unnecessary to quote from his brief concurring judgment. It follows that the decision of the Secretary of State in the present case can be challenged successfully only on the familiar Wednesbury/Ashbridge grounds. As to these, Mr Payton could not deny that there was evidence sufficient to satisfy the requirements of section 43(1)(a) read with section 36(2) of the 1974 Act. But he submitted that the CPO and its confirmation were nevertheless invalid because, as Mann J summarised this submission at p 7E of the transcript, ‘the power of purchase was being conferred as a rod or sanction’. The learned judge dealt with this submission at p 8A as follows: As to the first of the three grounds, it seems to me impossible to say that it was beyond the statutory power to confirm the order in relation to these premises. It was open to the Secretary of State on the material before him, which I have recited, to take the view that for the purposes set out in section 36(2) of the Act of 1974 or, more accurately, for the purposes of securing or assisting in securing those purposes, this order should be confirmed. It could not be said that there was no evidence. It cannot in my judgment be said that it is as a matter of law wrong to confirm a compulsory purchase order with a view to securing the execution of works consensually if that be achievable. So the first ground as I understand it fails. As we followed Mr Payton’s argument on this appeal, he did not criticise this passage except by submitting in passing that its reasoning may have involved a misconstruction of section 43(1)(a). This refers to the Secretary of State authorising a local authority ‘to acquire compulsorily any land. . . ‘. Mr Payton submitted that the provision did not envisage an authorisation in the form of the confirmation of a CPO which might or might not be implemented thereafter by the actual acquisition of the land in question. He said that the provision envisaged that acquisition would in fact take place. In our view, this is an untenable distinction. The confirmation of a CPO obviously operates as an authorisation to the local authority to acquire the land. But, equally obviously, the confirmation does not compel the implementation or enforcement of the order by actual acquisition, which will remain within the discretion of the local authority. Provided that the statutory requirements for making a CPO are satisfied, and that its confirmation cannot be challenged on Wednesbury/Ashbridge principles, the legal validity of the CPO and of its confirmation must both be unassailable, whether or not actual acquisition subsequently ensues. So we come to Mr Payton’s main submission, that the confirmation of the CPO infringed the Wednesbury/Ashbridge principles because, in the circumstances of this case, it was irrational or manifestly unreasonable in the light of the inspector’s report. Mr Payton did not go so far as to submit that confirmation of the CPO was irrational because the council, the inspector and the Secretary of State clearly hoped, in company with the applicants themselves, that its implementation by actual acquisition might ultimately prove to be unnecessary. He accepted that similar situations frequently arise and that undertakings by local authorities of the kind referred to in para 15 and the second sentence of para 66 of the report are commonplace. His challenge to the rationality of the decision was based on two other grounds. First, having regard to the favourable findings in the inspector’s report, and the fact that all concerned, as he put it, hoped that actual acquisition of the property would never take place, he said that no one in the position of the Secretary of State could reasonably conclude that there was any need for a CPO in the circumstances of this case. Second, he submitted that the confirmation of the CPO was in fact counter-productive, since its very existence prevented the owner from borrowing the necessary funds on the security of the property to carry out the works. In relation to the first of these points, Mr Payton relied on a later passage in the judgment of Slade LJ in the de Rothschild case where, in dealing with the facts of that case, he said at p 17E of the transcript: 41 If, therefore, the Secretary of State had explicitly said that he considered that the route proposed by the council was better than those proposed by the appellants . . . I do not believe that this appeal could have got off the ground, or indeed that it would have been brought. However, in the crucial sentence . . . of his decision letter . . . the Secretary of State did not say this in terms. He merely said that he did not believe that any of the suggested alternatives had sufficient advantages or benefits which would justify its adoption in place of the schemes proposed by the council. I would accept that, if the ultimate conclusion of the Secretary of State as expressed in his letter, when properly read as a whole, was merely that, after taking all the circumstances into account, the appellants have not shown that any of their schemes were better than the council’s scheme, his decision would be impeachable on Wednesbury grounds. For it seems to me that no reasonable Secretary of State would confirm a compulsory purchase order imposing a purchase on an unwilling landowner if that same landowner was willing to sell to the acquiring authority land which would be seen to serve equally well for the same purpose after all relevant considerations, including of course cost and delay, have been taken into account. In our view, this passage does not assist the argument here. Although the present case may well be unusual — as Mr Payton said — to the extent that the inspector’s report contained a number of positive and highly favourable findings from the point of view of the applicants, it is quite impossible to say that this rendered the confirmation of the CPO irrational in all the circumstances. In that connection, three matters must be borne in mind. First, the lengthy history of the dilapidation and disrepair of this property. Second, that at the time of the inquiry the applicant, although willing, was not yet ready or able to carry out the repairs. Third, that the council had given the undertakings referred to in the report which the inspector and the Secretary of State were entitled to take into account, as they clearly did. The first of these matters requires no elaboration, and the findings in paras 63.15 to 18 and the last sentence of para 65 speak for themselves as regards the applicants’ inability to proceed immediately with the necessary work; and para 20 is also material. To see the position in the round one should also note a passage from the proof of evidence of Mr A Wilkes, the area team leader of the HAA, which the inspector annexed to his report. He stated: The Council’s practice is also to recommend the exclusion of houses from a CPO where owners themselves achieve the objectives of the HAA. The Council has to assess when an owner submits proposals for the improvement of a property, whether the proposals themselves are satisfactory and most importantly whether the owner is both able and willing to implement their proposals and whether on the balance of evidence available the HAA objectives will be achieved. However, in those cases where improvement proposals are still being discussed or where substantial work has not been completed the Council still seeks confirmation of the order for the following reasons. Firstly, as stated above, the track record of the owners of these properties must give rise to doubts as to their will to achieve HAA objectives. Secondly, owners often fail to implement their proposals despite having expressed every intention of doing so. Sometimes the reason for this is the expense of doing the works. Sometimes it is their practical inability to make the necessary arrangements for what is often an extremely complex process. The consequences of such failures are extremely serious. Tenants will have to continue living in poor conditions. It wastes the Council resources as it often necessitates further statutory enforcement action and most importantly prejudices the achievement of HAA objectives within the life of the HAA. The Council, therefore, argues that the only circumstances which should be taken into account are the Council’s general case and the condition and past history of the property at the time of this inquiry. However, the Council is also prepared to give an undertaking that when the order is confirmed and if the owner subsequently meets the Council’s requirement in a rapid and effective manner then the Council will not implement the order as long as substantive proposals are received prior to this Public Inquiry. The Council is, of course, still seeking confirmation of this order as it appears that it is now the only effective method of meeting HAA objectives. That was the position until the public inquiry was opened. The applicants’ substantive proposals were made only in the course of it. In these circumstances it seems to us, despite the inspector’s favourable findings, that there was every justification for the statement in para 65 of his report that ‘the proposals put forward at the Inquiry are no more certain of being put into effect than other proposals have been’. We then turn finally to Mr Payton’s last point. He claimed that the decision to confirm the CPO was irrational because the very existence of the CPO was counter-productive, since its effect was to prevent the owner from carrying out the works, as he and all concerned — except possibly the tenants — hoped would happen. The reason, it was said, was that no mortgagee would lend money on the security of a property which is subject to a CPO. The first answer to this, as Mr Pleming pointed out, is that there is no evidence which supports it, since the point was never raised at the inquiry. In that connection we would entirely reject Mr Payton’s faint riposte that, by analogy with what was said by this court in Prest, the Secretary of State was under a duty to cause the availability to the owners of funds for repairs in such circumstances to be investigated of his own volition. There is no analogy with the facts of that case. Second, as Mr Pleming also pointed out, it is difficult to see why, given goodwill and co-operation, this problem — if it be one — cannot be overcome. Since undertakings of the kind given in this case are evidently commonplace, and since property owners in the position of the applicants presumably frequently need to borrow to carry out the necessary works, there is no reason to attach any real weight to this alleged problem. Indeed, it appears to be overstated in this very case. At the request of Mr Payton we agreed de bene esse to look at some correspondence between the applicants’ solicitors and the directorate of legal services in Hackney. Mr Payton said that this showed lack of response and co-operation on the part of the council. In the initial letter of April 29 1988 the applicants suggested that they might abandon this appeal in certain circumstances. We have taken no account of that part of the correspondence. However, it is of some interest to observe that the letter included the following paragraph: Our clients remain anxious to carry out a full conversion of the property to accommodate all the occupants presently in residence. The difficulty is with the Compulsory Purchase Order still hanging over the property, they are reluctant to incur any further expense in finalising conversion plans, applying for planning permission etc. This does not support the suggestion that the necessary finance would be unobtainable. For these reasons we reject all the submissions made on behalf of the applicants. However, it remains to remind those responsible in the administration of the Borough of Hackney that both the inspector’s recommendation to uphold the CPO and its confirmation by the Secretary of State took full account of the undertakings on behalf of the council which are referred to in the report. These do not merely involve refraining from implementing the CPO unless it becomes apparent that the applicants will not or cannot comply with the council’s reasonable demands in relation to the works. The undertakings should also involve the council’s positive co-operation with the applicants by giving them every reasonable assistance to carry out their intentions, in order to achieve the hope that implementation of the order will not be necessary. This appeal is dismissed. No order was made for costs.