AC-2024-LON-0001595 - [2025] EWHC 2182 (Admin)

Mr Litton’s oral submissions on Ground 6 focused on two matters: first, it was submitted that there was no rational explanation for considering that the “troubling evidence” about Rydon Maintenance meant that Rydon was unfit, particularly as the latter had already successfully remediated 15 buildings; and second, that it was irrational to rely in the Decision Letter on the counterfactual of having reached Stage D when that was not in fact the case, particularly when Rydon had given a reliable assurance that it could start remediation work within 28 days.

The first of these has already been considered under Grounds 1 to 5: see, in particular, [108] above. It does not establish irrationality.

The ‘counterfactual’ argument also fails to demonstrate irrationality. The passage of the Decision Letter relied upon by the Claimant (highlighted below) must be considered in context:

“Each of these buildings suffers from life-critical fire safety defects. By default, they are classified by the SRTs as Stage C Fund Buildings, because at the time Rydon entered into the Contract as the Participant Developer for its group (15 September 2023), awards of full funding had been communicated to the Responsible Entities but the Grant Funding Agreements (“GFAs”) had not yet been signed by all parties, DLUHC not yet having provided its countersignature.

Had the GFAs been countersigned by DLUHC by 15 September 2023, the buildings would have been automatically classified as Stage D Fund Buildings and the planned works programmes would have commenced on or around 30 October 2023.

Stage C and D Fund Buildings are to be contrasted with Stage A and B Fund Buildings (where no award of full funding has been communicated as at the date of the Contract). Whereas the default position is that Stage A and B Fund Buildings will be transferred to the relevant Participant Developer (see generally clause 12 of the SRTs), a Stage C Fund Building may only be transferred to a Participant Developer where it requests this in writing and “DLUHC, acting reasonably, accepts such request” (clause 13.2). Stage D Fund Buildings may not be transferred to Participant Developers to carry out remediation works themselves (see clause 13.8)...” (Emphasis added)

It is apparent, when read as a whole, that this passage, which comes under a section of the Decision Letter headed “The buildings”, is setting out the background to the decisions and does not purport to form part of the rationale for them. Moreover, the SoS acknowledges in unambiguously clear terms that the Cable Street Buildings are presently at Stage C, the Department “not yet having provided its countersignature”. In referring in the next sentence to what would have transpired had the countersignature been applied by 15 September 2023, the SoS was doing no more than highlighting the advanced stage that the process had already reached within Stage C. There is, to my mind, nothing remotely irrational or unreasonable in his doing so, and it cannot reasonably be suggested that the SoS was thereby proceeding on the basis of the counterfactual rather than the position as it actually stood at the time.

The final substantive point under this ground concerns the SoS’s reliance upon the risk of delay to remediation as part of the justification for the Clause 7.7(B) Decision. This is said to be irrational because Rydon had indicated that it would have been in a position to commence works within 28 days, and the officers’ assessment had been that there was credible evidence that Rydon could meet the start dates.

The relevant passage of the Decision Letter is as follows:

“In reaching this decision, DLUHC has carefully considered whether to require Rydon to fund directly the Responsible Entities to enable them to arrange the necessary remediation works (i.e. in accordance with clause 7.7(A) of the SRTs), instead of the Responsible Entities receiving the funding approved by the BSF. In this regard, DLUHC acknowledges evidence you have provided to the effect that the scope and cost of works may be reduced if the buildings are not retained within the BSF. However, DLUHC considers that there is a material risk that this course of action could lead to delays in the commencement of the works and has therefore decided to exercise its right under clause 7.7(B) to designate the three buildings as Stage D Fund Buildings instead. As noted above, the GFAs between the BSF and the Responsible Entities for the three buildings have already been prepared and the planned works programmes can therefore commence with minimum further delay.”

The delay to which the SoS refers is that which would arise had there been a direction pursuant to Clause 7.7(A), which would require Rydon to fund works undertaken by the REs; whether or not Rydon was in a position to start works within 28 days was irrelevant to that direction as it would have been the REs doing the works in any event.

Even if that had not been the case, it would not have been irrational to take account of the risk of some delay for the reasons considered above at [122].

The final point arising in the Agreed List of Issues under this Ground is whether adequate reasons were given for the Designation Decision. This ground is not explained or developed in the Claimant’s Skeleton Argument and was only mentioned briefly by Mr Litton by way of Reply. I can deal with it similarly briefly by stating that I can see no basis whatsoever for the suggestion that the reasons are inadequate.

Accordingly, Ground 6 fails and is dismissed.