- Maintained schools and borrowing—ultra vires defence to private law claims (School Facility Management Ltd and others v Governing Body of Christ the King College)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Case details
Local Government analysis: In this case, Christ the King College (the college), a maintained school, entered into a 15-year lease of a building from School Facility Management Ltd (SFM). Maintained schools may not borrow without the Secretary of State’s consent (schedule 3 of the Education Act 2002 (EA 2002)). SFM, aware of this, secured written assurances from the school and its maintaining local authority that the college had power to enter into the lease. Four years into the lease, the college ran into financial difficulties and stopped making the lease payments. It said that the lease was ultra vires as a finance lease, and therefore borrowing without consent, so that it was not liable under the contract. SFM sued the college for breach of contract, misrepresentation, and unjust enrichment. It also sued the local authority for misrepresentation and on the basis that it was the college’s principal under section 49 of the School Standards and Framework Act 1998 (SSFA 1998). Written by Peter Oldham QC and Christopher Knight, barristers, at 11KBW.
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