| Local Government Ombudsman Watch |
Misfeasance and 'local settlements' - by Trevor R Nunn
The Local Government Ombudsman was set up by Statute in 1974. This gave him the statutory right to
investigate, (or at their discretion, not investigate,) complaints of maladministration against local authorities.
However, I have always believed the LGO exceeded their statutory powers by introducing and using `Local
Settlements'. The current Government Review is the final confirmation that I am right, and this is my story.
I believe the LGO have been extremely lucky over the last thirty years that no individual or organisation such as
Ombudsmanwatch has questioned their power to settle a case.
I have never, knowingly, suffered a Local Settlement, so I do not have first-hand experience of challenging one.
However, I know of many others who have been disgusted by the treatment dished out by the LGO under the
excuse of a Local Settlement.
If you exclude their statutory powers the LGO, like any other authority, have no more powers than you or I.
The 1974 Statute makes no mention of Local Settlements at all.
In a civil case it has always been the prerogative of the two sides to reach an agreement to settle a case before
judgement is given. By definition the `agreement to settle' must be mutual, otherwise either one of the parties
could go on with the case. There is nothing wrong with that, as long as both parties agree. As a typical
example, when I took a company to an industrial tribunal for unfair dismissal, it was obvious during the early
part of the hearing that the company was going to lose. During the lunch break I was made an offer I couldn't
refuse. (A lot of money, not a horse's head in the bed kind of offer.) I accepted their offer, withdrew my
complaint of unfair dismissal, and went home to with a big fat cheque. However, the point is that I could have
refused to settle and continued with the case: the choice was mine.
Unfortunately, the LGO version of a settlement is quite different. The LGO, rather than the complainant, makes
the deal with the Council, and then decides to accept it no matter what the complainant wants. I acknowledge
that in some cases the complainant is happy with the settlement, but in many they are not, but the LGO
nonetheless refuses to continue with the investigation. The point is that they facilitate a Local Settlement and
then use that as a reason to discontinue a valid complaint of maladministration, without the agreement of the
complainant. That is misfeasance, because they quite simply they do not have the statutory power to do that.
They can investigate, and find (or not find) maladministration, or they can refuse to investigate for any number
of reasons.
The normal process (if the LGO decides to investigate) is that, during the investigation, the LGO finds
maladministration, and before the report is written, the Council make an offer to the LGO to Locally
Settle the case. The LGO then `discontinues the investigation' and classes the case as Locally Settled. That is
misfeasance for the simple reason that the Ombudsman has only one statutory option should
maladministration be identified. That is to issue a report.
The LGO is sneaky. They do have the statutory power to end an investigation for any reason, so what they
suggest is that the investigation has been terminated because a case has been locally settled. However, once
maladministration has been identified (and it would have to be for a Council to offer a settlement) the
investigation is over: there is nothing to terminate. They only have one lawful option and that is to produce a
report. They cannot travel back in time and ignore the maladministration, suggest that they are still
investigating, and then use their statutory power to terminate the investigation.
In essence it is similar to a court case. During a trial, it is open to both parties to reach an agreement to settle a
case. However, once the Judge has decided that the defendant is guilty, whatever else happens, the Judge has
to deliver the Judgement. He can't say, hang on a moment, I did find the defendant guilty but he has now
offered a settlement, so now I am going to tear up the guilty verdict, find him not guilty, and accept the
settlement on behalf of the plaintiff.
So how could you define a `Settlement'? There is only one definition that springs to mind: it is clearly an
alternative method of resolving a dispute (ADR). It is also quite clear that such settlements are mediated by the
LGO.
We all know the LGO only has the powers to investigate, or not investigate. They do not have the statutory
power to use Alternative Dispute Resolution. If you don't believe me, look at the Regulatory Reform Order. The
Government wants to give the LGO ADR powers. Why would the Government give the LGO
powers if they already have them? There is only one answer to that question: the LGO currently does not have
the powers to settle a case.
If I am right, and I confident that I am, then every single `Locally Settled' case that did not have the agreement
of the complainant, is an act of misfeasance by the LGO. As a result, anyone who has been forced to accept a
`Local Settlement' has the legal right for their case to be reviewed. I hope you appreciate that a complainant
could also claim substantial damages from the LGO for misfeasance. When you realise that the damages could
run into £millions, you can understand why the Government want to close this black hole. Hence the RRO.
The RRO has been on the cards for the last six or seven years, so you have to ask yourself, why now? I believe
that the LGO and the Government are concerned about the growing membership of LGOWatch and
have realised that one of these days, someone somewhere is going to put two and two together.
Furthermore, they may well close the stable door after the horse has bolted, but that does not stop a claim for
misfeasance that originated prior to that date.
If I was in America, I would suggest that all the complainants who have had to accept a `Locally Settled' case
instead of an investigation leading to a finding of maladministration, take a class action legal case against the
LGO. In America there are many more Lawyers willing to take a `Pro Bono' or `No Win, No Fee' case. With the
potential damages from the LGO alone running into millions, let alone any spin-off benefits from reopening a
complainant's case against the Councils I am sure there would be plenty of lawyers interested without
a complainant having to risk any of their own money.
The LGO Jerry White is right when he states his role is to investigate complaints of injustice arising out of
maladministration; he is also right when he states that the objective is to secure a remedy appropriate to the
injustice. In addition he is also right when he states that they should try and put the person back in the position
where they would have been before the maladministration occurred.
He is partially right when he states that the Local Government Act gives the Ombudsman the power to decide
whether to issue a report or not. He is also right when he states that he has the discretion to discontinue an
investigation.
However, here is where the clever bit comes in: if he has found maladministration, then he must issue a report.
He has no discretion in this. By definition, if he has accepted a settlement which he thinks puts you back in the
position where you would have been before maladministration, then he must accept that maladministration has
taken place. What the LGO do, though, is to ignore the fact they have found maladministration, pretend they
are still investigating, and then use their discretionary power to discontinue the investigation. So in essence
they have forced you to settle for the injustice you have suffered through maladministration without formally
finding maladministration. That, I believe, is misfeasance. A statutory organisation cannot extend their express
powers by such underhand means. They do not have any express statutory powers to settle a case. If
maladministration is found, they should issue a report. It is an LGO fiddle that has been going on for long
enough.
Please read the 1974 Act. There is no mention in it of local settlement at all. However, look at how many times it
mentions investigate/maladministration etc. Do you not find it at all unusual that an LGO has express statutory
powers for 1.6% of their work yet there is no mention at all of Local Settlements which account for some 29% of
their work? If the Government felt the need to give an organisation the express statutory power to investigate,
do you not think that they would have also included the express statutory power to settle a case if it was going
to be used 20 times more than a report of maladministration?
The LGO is essentially stating that he is using Alternative Dispute Resolution, something he has not yet got the
statutory powers to do. It is also interesting that the Government are about to remove that problem by giving
the LGO the express statutory powers to settle a case, something they would not have to do if the LGO already
had those powers.
All the LGO wants to do is bury maladministration for the benefit of a council: not to give the complainant the
justice they so deserve.
Trevor R Nunn, October 2005
investigate, (or at their discretion, not investigate,) complaints of maladministration against local authorities.
However, I have always believed the LGO exceeded their statutory powers by introducing and using `Local
Settlements'. The current Government Review is the final confirmation that I am right, and this is my story.
I believe the LGO have been extremely lucky over the last thirty years that no individual or organisation such as
Ombudsmanwatch has questioned their power to settle a case.
I have never, knowingly, suffered a Local Settlement, so I do not have first-hand experience of challenging one.
However, I know of many others who have been disgusted by the treatment dished out by the LGO under the
excuse of a Local Settlement.
If you exclude their statutory powers the LGO, like any other authority, have no more powers than you or I.
The 1974 Statute makes no mention of Local Settlements at all.
In a civil case it has always been the prerogative of the two sides to reach an agreement to settle a case before
judgement is given. By definition the `agreement to settle' must be mutual, otherwise either one of the parties
could go on with the case. There is nothing wrong with that, as long as both parties agree. As a typical
example, when I took a company to an industrial tribunal for unfair dismissal, it was obvious during the early
part of the hearing that the company was going to lose. During the lunch break I was made an offer I couldn't
refuse. (A lot of money, not a horse's head in the bed kind of offer.) I accepted their offer, withdrew my
complaint of unfair dismissal, and went home to with a big fat cheque. However, the point is that I could have
refused to settle and continued with the case: the choice was mine.
Unfortunately, the LGO version of a settlement is quite different. The LGO, rather than the complainant, makes
the deal with the Council, and then decides to accept it no matter what the complainant wants. I acknowledge
that in some cases the complainant is happy with the settlement, but in many they are not, but the LGO
nonetheless refuses to continue with the investigation. The point is that they facilitate a Local Settlement and
then use that as a reason to discontinue a valid complaint of maladministration, without the agreement of the
complainant. That is misfeasance, because they quite simply they do not have the statutory power to do that.
They can investigate, and find (or not find) maladministration, or they can refuse to investigate for any number
of reasons.
The normal process (if the LGO decides to investigate) is that, during the investigation, the LGO finds
maladministration, and before the report is written, the Council make an offer to the LGO to Locally
Settle the case. The LGO then `discontinues the investigation' and classes the case as Locally Settled. That is
misfeasance for the simple reason that the Ombudsman has only one statutory option should
maladministration be identified. That is to issue a report.
The LGO is sneaky. They do have the statutory power to end an investigation for any reason, so what they
suggest is that the investigation has been terminated because a case has been locally settled. However, once
maladministration has been identified (and it would have to be for a Council to offer a settlement) the
investigation is over: there is nothing to terminate. They only have one lawful option and that is to produce a
report. They cannot travel back in time and ignore the maladministration, suggest that they are still
investigating, and then use their statutory power to terminate the investigation.
In essence it is similar to a court case. During a trial, it is open to both parties to reach an agreement to settle a
case. However, once the Judge has decided that the defendant is guilty, whatever else happens, the Judge has
to deliver the Judgement. He can't say, hang on a moment, I did find the defendant guilty but he has now
offered a settlement, so now I am going to tear up the guilty verdict, find him not guilty, and accept the
settlement on behalf of the plaintiff.
So how could you define a `Settlement'? There is only one definition that springs to mind: it is clearly an
alternative method of resolving a dispute (ADR). It is also quite clear that such settlements are mediated by the
LGO.
We all know the LGO only has the powers to investigate, or not investigate. They do not have the statutory
power to use Alternative Dispute Resolution. If you don't believe me, look at the Regulatory Reform Order. The
Government wants to give the LGO ADR powers. Why would the Government give the LGO
powers if they already have them? There is only one answer to that question: the LGO currently does not have
the powers to settle a case.
If I am right, and I confident that I am, then every single `Locally Settled' case that did not have the agreement
of the complainant, is an act of misfeasance by the LGO. As a result, anyone who has been forced to accept a
`Local Settlement' has the legal right for their case to be reviewed. I hope you appreciate that a complainant
could also claim substantial damages from the LGO for misfeasance. When you realise that the damages could
run into £millions, you can understand why the Government want to close this black hole. Hence the RRO.
The RRO has been on the cards for the last six or seven years, so you have to ask yourself, why now? I believe
that the LGO and the Government are concerned about the growing membership of LGOWatch and
have realised that one of these days, someone somewhere is going to put two and two together.
Furthermore, they may well close the stable door after the horse has bolted, but that does not stop a claim for
misfeasance that originated prior to that date.
If I was in America, I would suggest that all the complainants who have had to accept a `Locally Settled' case
instead of an investigation leading to a finding of maladministration, take a class action legal case against the
LGO. In America there are many more Lawyers willing to take a `Pro Bono' or `No Win, No Fee' case. With the
potential damages from the LGO alone running into millions, let alone any spin-off benefits from reopening a
complainant's case against the Councils I am sure there would be plenty of lawyers interested without
a complainant having to risk any of their own money.
The LGO Jerry White is right when he states his role is to investigate complaints of injustice arising out of
maladministration; he is also right when he states that the objective is to secure a remedy appropriate to the
injustice. In addition he is also right when he states that they should try and put the person back in the position
where they would have been before the maladministration occurred.
He is partially right when he states that the Local Government Act gives the Ombudsman the power to decide
whether to issue a report or not. He is also right when he states that he has the discretion to discontinue an
investigation.
However, here is where the clever bit comes in: if he has found maladministration, then he must issue a report.
He has no discretion in this. By definition, if he has accepted a settlement which he thinks puts you back in the
position where you would have been before maladministration, then he must accept that maladministration has
taken place. What the LGO do, though, is to ignore the fact they have found maladministration, pretend they
are still investigating, and then use their discretionary power to discontinue the investigation. So in essence
they have forced you to settle for the injustice you have suffered through maladministration without formally
finding maladministration. That, I believe, is misfeasance. A statutory organisation cannot extend their express
powers by such underhand means. They do not have any express statutory powers to settle a case. If
maladministration is found, they should issue a report. It is an LGO fiddle that has been going on for long
enough.
Please read the 1974 Act. There is no mention in it of local settlement at all. However, look at how many times it
mentions investigate/maladministration etc. Do you not find it at all unusual that an LGO has express statutory
powers for 1.6% of their work yet there is no mention at all of Local Settlements which account for some 29% of
their work? If the Government felt the need to give an organisation the express statutory power to investigate,
do you not think that they would have also included the express statutory power to settle a case if it was going
to be used 20 times more than a report of maladministration?
The LGO is essentially stating that he is using Alternative Dispute Resolution, something he has not yet got the
statutory powers to do. It is also interesting that the Government are about to remove that problem by giving
the LGO the express statutory powers to settle a case, something they would not have to do if the LGO already
had those powers.
All the LGO wants to do is bury maladministration for the benefit of a council: not to give the complainant the
justice they so deserve.
Trevor R Nunn, October 2005
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