Council defends High Court challenge over grant of lease to local football club

Stephen Morgan objected to the lease granted to Guisborough Town Football Club.

His main ground was that the council failed to have regard to an obviously material consideration, which was its own evidence base in the 2016  Redcar and Cleveland Public Open Space Assessment Report.

Mr Morgan also argued that the council failed to comply with the duty, in section 123(2) of the Local Government Act 1972, not to dispose of land “otherwise than by way of a short tenancy, for a consideration less than the best that can reasonably be obtained”.

He said the council received no advice about the application of this disposal duty, that no valuation evidence was provided to the cabinet and no information was provided as to whether the proposed lease represented the best consideration reasonably available.

A third ground was an alleged breach of section 149 of the Equality Act 2010.

HHJ Klein, sitting as a High Court judge, said in his judgment that the football club  occupies 7.59 acres of the King George V Playing Fields, of which 3.56 acres is under a 15-year 2018 lease and 4.03 acres under a licence, granted in 2019 and the latter is subject to a statutory trust by which it is available for enjoyment by the public.

If the proposed new lease were executed, both the leased and licensed land will be freed from the trust.

The judge said he had to consider whether the proposal of leasing additional land to the club unreasonably impinged on the availability of public open space.

Counter-balancing the objections was the potential for the club to offer greater opportunities for participation in sport and enhanced facilities.

HHJ Klein said he had not taken account of Mr Morgan's witness statement, “broadly because what he says is irrelevant to the dispute.

“He made a serious unpleaded allegation that the decision was ‘pre-ordained’. He was critical of a historic planning permission, which is not relevant to the claim or any of his grounds for judicial review. He made irrelevant criticisms about the process the council adopted in this case. He made a serious irrelevant allegation about the conduct of one of the cabinet members.”

The judge also declined to take account of evidence from Mr Morgan on the club’s finances as “there is no foundation in the witness statement for, or any documentary material exhibited which supports, Mr Morgan's claims about the football club's revenue”.

He dismissed the ground concerning open space because cabinet members gave careful consideration to the amount of public open space in Guisborough after execution of the proposed new lease.

Turning to the price for the lease he noted evidence from a council surveyor of many years standing, Brian Masterman, that obligations under section 123 would be triggered.

HHJ Klein said cabinet members were told they had to consider whether the proposed disposal was at an undervalue and were advised it was not.

“It follows, therefore, that the cabinet was told that the proposed lease represented the best consideration reasonably available,” he said.

“To comply with the disposal duty, the cabinet did not need to know why Mr Masterton had concluded that the rent is a proper price for the leased land and the licensed land.”

HHJ Klein concluded: “I am not satisfied that the grant of the proposed new lease will be in breach of the disposal duty just because the cabinet did not know that, to comply with section 123, a proper price for the leased land and the licensed land had to be obtained, because the cabinet was asked to consider whether or not the proposed disposal was at an undervalue and because the cabinet members knew, including from Mr Masterton's reports, that the football club was already in occupation of the leased land and the licensed land and that it had a particular interest in remaining there under a lease (and so was, or might be, a special purchaser).”

He dismissed the ground concerning the public sector equality duty as Mr Morgan did not claim to have a protected characteristic nor argued that the decision would have an unequal impact on anyone else with a protected characteristic.

HHJ Klein said: “It is notable that, although many objections were made to the proposal in this case, none of the objectors apparently complained that the decision might impact someone with a protected characteristic unequally or that the decision might otherwise have any equality impact.”

Mark Smulian