The case of Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147 is a landmark decision for law students exploring judicial review and the scope of administrative authority. This case critically examines the limitations on the powers of administrative tribunals and the extent to which their decisions can be subjected to judicial review, challenging the traditional boundaries of legal oversight.

  • In the case of Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147, ultra vires immediately comes into effect in the event that a public body makes a decision involving an error of the law.
  • The above principle therefore stipulates that an ouster clause denying the ability to apply for judicial review with regard to public authority policies and decisions involving an error of the law will not be valid in denying a review.

Facts of the Case Anisminic Ltd v Foreign Compensation Commission

  • C applied for judicial review of D’s decision reject the claim involving distribution of compensation paid by the Egyptian government to the British government connected to British properties that were nationalised. C’s mining properties were one of the nationalised properties in Egypt which were sold to an Egyptian state-owned enterprise.
  • D found that the term ‘successors in title’ required the title-holders of the properties to be British.
  • C’s application for judicial review was based on the assertion that D’s decision involved an error of the law due to a misinterpretation of the legislation (the Foreign Compensation Act 1950)

Issues in Anisminic Ltd v Foreign Compensation Commission

  • Did D make an error of the law during its interpretation of the Foreign Compensation Act 1950?
  • Was the ouster clause effectively denying judicial review?

Held by the House of Lords

  • The House of Lords allowed C’s appeal and found that D did in fact misinterpret the Act, particularly what was meant by ‘successors in title’ therefore ultra vires automatically applied and nulled D’s decision.

Lord Reid

  • Lord Reid dismantles the general proposition that decisions by tribunals like D can only be nullified where they have acted outside their jurisdiction. His Lordship clarifies this position by suggesting other circumstances in which a decision by a tribunal may be nulled. This includes where the decision was made in bad faith, where the tribunal had no power to make the decision, or it did not meet the requirements of natural justice, inter alia.
  • “But there are many cases where, although the tribunal had jurisdiction to enter on the inquiry, it has done or failed to do something in the course of the inquiry which is of such a nature that its decision is a nullity. It may have given its decision in bad faith. It may have made a decision which it had no power to make. It may have failed in the course of the inquiry to comply with the requirements of natural justice. It may in perfect good faith have misconstrued the provisions giving it power to act so that it failed to deal with the question remitted to it and decided some question which was not remitted to it. It may have refused to take into account something which it was required to take into account. Or it may have based its decision on some matter which, under the provisions setting it up, it had no right to take into account.” [171]

Lord Pearson (dissenting judgment)

  • Lord Pearson agreed with most of the points of the rest of their Lordship but failed to agree that “the commission misunderstood the Order in Council, or made any error affecting their jurisdiction.”
  • “…the applicant having satisfied the listed requirements of the Order, it was outside the jurisdiction of the commission to consider whether or not the applicant had a successor in title and in this the commission misconstrued article 4 . The expression “successor in title” was inappropriate to denote any person while the original owner was still in existence.”

Significance of the Case in Legal Development

Anisminic Ltd v Foreign Compensation Commission is pivotal for its role in expanding the scope of judicial review:

  1. Council of Civil Service Unions v Minister for the Civil Service [1985]: Known as the GCHQ case, it reinforced the principles of judicial review of administrative actions.
  2. O’Reilly v Mackman [1983]: This case further explored the routes through which judicial reviews could be conducted, affirming the importance of using the appropriate procedural channels.
  3. R v Hull University Visitor, ex parte Page [1993]: Highlighted the exceptions to judicial review, particularly in cases involving the decisions of university visitors, but reiterated the general principle set out in Anisminic about the breadth of judicial review.

Exam Questions and Answers

Below, you will find answers to questions that are most commonly asked based on this case.

How has the Anisminic ruling influenced the development of administrative law concerning other forms of governmental decision-making?

The Anisminic decision has broadened the scope of judicial review in administrative law, influencing decisions beyond just compensation commissions. For instance, in R (Privacy International) v Investigatory Powers Tribunal [2019], the Supreme Court applied Anisminic principles to confirm that even decisions made by tribunals with seemingly exclusive jurisdiction are subject to judicial review, thereby ensuring that governmental decisions do not escape scrutiny under the guise of legal immunities.

What are the current challenges in applying the Anisminic principles to decisions made under new digital governance frameworks?

As government decision-making increasingly incorporates digital platforms and algorithms, applying the Anisminic principles poses challenges, particularly in ensuring transparency and accountability. Cases like R (Bridges) v Chief Constable of South Wales Police [2020], involving the use of facial recognition technology, illustrate the complexities of reviewing decisions made through new technological frameworks. The courts must balance innovation with the rights of individuals, ensuring administrative actions are lawful and just.

How do UK courts balance the need for administrative discretion with the principles of fairness and justice in light of Anisminic?

UK courts continue to balance the need for administrative discretion with ensuring fairness and justice. In R (on the application of UNISON) v Lord Chancellor [2017], the Supreme Court overturned fees for employment tribunals that were deemed unfair and an impediment to access to justice, applying Anisminic principles to ensure that administrative decisions do not infringe fundamental rights or deny access to justice. This case demonstrates the ongoing commitment to scrutinizing even economically motivated governmental actions to maintain fairness in administrative processes.

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