IN THE HAVERFORDWEST COUNTY COURT

CASE NUMBER: 5HV01232

Before: District Judge Godwin
Heard on: 9th & 19th October 2006

BETWEEN:

I.C.T. MARKETING LIMITED
Claimant

-and-

MANORBIER COMMUNITY COUNCIL
Defendant

RESERVED JUDGMENT

1. Manorbier is a picturesque village community in the south of Pembrokeshire situate within the Pembrokeshire National Park. The community boasts a medieval castle, a safe beach and a number of small businesses, many focused upon tourism. Its first tier of local governance is devolved to the Manorbier Community Council ("the defendant") which covers not only the village of Manorbier but also some smaller villages and hamlets in the immediate area.

2. In 2001, the Community decided to embark upon a survey to ascertain the views of those living within the community as to the facilities and projects they desired to improve the locality. In order to arrange for the survey to be undertaken, the Clerk to the defendant approached the Regeneration Unit of Pembrokeshire County Council; that unit appointed one of its Community Development Officers, a Mr Alex Allison, to advise and guide the community in the relation to the survey. Mr Allison attended community meetings with during the first half of 2002. He had previous experience of organising community surveys and was able to provide a model survey questionnaire to be sent to all homes in the community. He was also able to advise that grant aid might be available to fund the project from the Welsh Development Agency ("WDA"). Mr Allison advised that the likely overall cost of preparing the required questionnaires and having the completed questionnaires processed and analysed and transformed into a final report (which work I shall refer to as "the overall project"), would be in the region of £5,500. He assisted the Clerk to the defendant Council in making the grant application to WDA by obtaining quotations from two marketing companies experienced in the work of analysing and interpreting the completed questionnaires and reporting their findings (which I shall refer to as "its part in the project"). One of the two quotes obtained was from a Dr Lyneth M Davies, a Research Assistant at Aberystwyth University. The other quote was obtained from I.C.T. Marketing Limited of Haverfordwest, Pembrokeshire ("the claimant").

3. The claim in these proceedings is to recover the sum of £4,578.98 being the cost of its services in undertaking its part in the project, plus interest pursuant to section 69 of the County Courts Act 1984 and the endorsed costs on the Claim Form. The defendant does not dispute that the claimant carried out its part of the project but says that the claimant did so without and contract being entered into or being formally instructed to do so by the defendant so as to make the defendant liable to meet the claim. In the alternative, it is the defendants' case that, if it is found that a contractual relationship exists between the parties that, the defendant is only liable for part of the sum claimed. I should mention at this point that it is admitted by the defendant that it submitted the claimants' invoice in respect of the work for its part of the project to the WDA and that the defendant received grant aid from WDA to include the £4,578.98 claimed by the claimant.

4. Central to the defendants' position is the question of how many completed questionnaires were required to be returned by members of the community before the claimant would be authorised to proceed with its part of the project. The defendant says that in order to constitute a worthwhile assessment of the views of the entire community, to enable future policy to be formulated, a minimum number of completed questionnaires would be needed. It appears that Mr Allison advised that if 60-65% of all questionnaires issued were completed and returned then that would constitute a sufficient return to provide a reliable survey report. There is a fundamental issue between the parties as to whether there was a "60-65%" return requirement. However, it is accepted between the parties, that 256 questionnaires were actually processed by the claimant to complete its part in the project. The claimant had no part in the production of the questionnaires or in delivering the questionnaires to members of the community to complete. Indeed, the claimant asserts that it was never told before completing its part of the project how many questionnaires had been distributed within the community but it accepts that it was informed that the "target figure" for completed returns was 390. No evidence has been adduced as to the number of questionnaires that were produced for the overall project and distributed. It is only by extrapolation, 390 being 65% of 600 that it is possible, on the evidence, to arrive at a figure of 600 as the number of questionnaires that would need to have been distributed for 390 to represent 65%. The claimant asserts that it was never a requirement that it should not proceed with its part of the project unless 390 questionnaires were returned. The claimant says that the 65% return was never more than a target or aspiration and says that it was requested to proceed to analyse and produce a report on the basis of the 256 questionnaires it received and that it did so in good faith believing that the defendant had decided to complete the overall project after receiving 256 questionnaires.

5. At the final hearing which, because of lack of time on the first half day allocated was heard over two days, I received two full lever arch folders containing the relevant documentation (some 568 pages). The claimant was represented by its managing Director, Mrs Debbi Garside and, on the first day of the hearing, I heard evidence from Mrs Garside and from two Manorbier Community Councillors, Mrs Griffiths and Mrs Pellowes called to give evidence by the claimant. At the resumed hearing, Counsel for the defendant, Mr Jake Pratt, presented the defendants case and called to give oral evidence the defendants' current Chairman, Councillor Wales, and the former Clerk to the defendant, Mrs Pamela Davies and a former Councillor, Mr David Morgan. At the end of the resumed hearing I needed to review the evidence and to consider the defendants' legal argument relating, in particular, local authorities and principles in the law of Agency. As a consequence, I decided to reserve my judgment and to hand it down in writing.

6. Having outlined above the general background to the case, it will now be necessary to track through the sequence of events, as revealed by the documentary evidence, in order to determine whether or not any contract does exist between the parties and, if so, on what terms. In so doing, I shall also consider the action taken, from time to time, during the overall project by the parties and other members of the Manorbier community. Such analysis will then permit the application of the legal argument to the facts, as I find them to exist, in order to enable me to determine whether or not the claimant is entitled to payment and, if so, how much.

7. It is convenient to start the chronology of events from 9th July 2002 when, having received initial advice and guidance from Mr Allison, the defendant decided to convene a Public Meeting of the Community ("the Public Meeting") to discuss the proposed survey which, in the documents produced, was then being described as a "Community Appraisal". Prior to the Public Meeting, Mr Allison had already obtained the two quotations from the two marketing companies referred to above. A copy of the quotation submitted by the claimant appears in the court bundle at pages 186-187 and is simply dated "July 2002". It is addressed to the Community Regeneration Unit of Pembrokeshire County Council. I do not know what preceded the submission of the quotations to the Regeneration Unit as no copy documents which may have passed between the claimant and Mr Allison prior to the issue of the quotation have been produced to the court. In Mrs Garside's written statement (Bundle page 20), Mrs Garside does not refer to the mode of her communications with Mr Allison and it may be the case that her initial communications with him were verbal and not in writing. Mrs Garside states that "This quotation was to facilitate the data entry of questionnaire surveys, base analysis, cross tabulations if required and the writing of a report only. The quotation was based on my experience in working with Alex Allison and a number of other officers within Mentor Preseli; the organisation that was previously responsible for performing the functions now being performed by PCC (Pembrokeshire County Council) Regeneration Unit. Alex Allison informed me that a Community Appraisal was currently being conducted within the Manorbier and District Community and that when the questionnaire was ready he would require an updated quotation pertaining to the actual survey that was currently in the process of being designed by the community." However, I note that the quotation issued by the other marketing agent, Dr Lynette M Davies, under cover of a letter dated 24th June 2002, does refer to her having received a letter from Mr Allison, dated 20th June 2002, enclosing a draft questionnaire (see Bundle page 185). Because the initial quotation from the claimant is dated only "July 2002" I do not know exactly when it was submitted to Mr Allison and it may be the case that it was not received by him until after the Public Meeting held on 9th July 2002? The claimants' quotation proposed the sum of £1.50 to input each completed survey questionnaire into the claimants' computer database and specified other sums for producing base tables and cross tabulation and a further £1,500.00 for the production of the final report. It also provided a cost indication should it desired to translate its report into Welsh.

8. At page 425 of the Bundle, there is a copy of a document which said to provide a "brief summary" of what happened at the Public Meeting. The document is headed "Manorbier Community Council" and appears to be signed by Councillor Mrs Lyn Beynon, the person who is stated to have Chaired the Public Meeting. The identity of the author of the brief summary is unknown to me though the then Clerk to the defendant was present at the Public Meeting and it is perhaps reasonable to presume that the Clerk, Mrs Pamela Davies, prepared it. The brief summary states that "Mr Allison gave a brief description of his work and advised all present that he had been involved with PCC in the last year but previously he had been involved with Mentor Preseli and other local organisations. He stressed that the Community Appraisal scheme was not his project but a Community project and he would have no input into its content but would advise along the way. After the draft questionnaire had been altered and approved by the Community Council it would go to print and every household would have a copy with the questionnaire to complete. He advised that he should be able to seek funding which would probably be in the region of £5,500 to cover the cost of the appraisal and it was his job to find the funding. His time would be charged at £25.00 per hour and would be included in the total funding, (although this is not the hourly rate that Mr Allison is paid). After the questionnaires have been completed they are then sent to Aberystwyth University to be processed and a report produced on the results. A 65% return rate is needed in order for the scheme to be a success. This allows for 10% error margin in the processing of the data and people not completing the questionnaires. The ideas that come out of the questionnaire will feed into the funding programmes for the future and the action plan that arises from the results will identify schemes needed within the community as identified by local people. It was decided to send copies of the "Wish Lists" to all organisations in order that each group could find out what other ideas had been put forward. A copy of the draft questionnaire together with the Wish Lists to be left with local organisations/businesses in the locality for local people to comment in time for the next CC Meeting. Mr A McCabe thanked Mr Allison for all the work that he was giving to the Community and thought that the whole scheme would benefit the whole community. The Community Council to report to Mr Allison after the next CC meeting which is scheduled for 8th August 2002 with any alterations to the draft questionnaire. There being no further business the meeting was declared closed at 9.00p.m.". There is no suggestion in any of the evidence I have received that any mention of the claimant was made at the Public Meeting or that a copy of the said "brief summary" was ever sent to the claimant at any time prior to the institution of these proceedings. The reference in the "brief summary" to the completed questionnaires being sent to Aberystwyth University may suggest that the only quotation received prior to the Public Meeting was the quotation from Dr Lynette M Davies?

9. Following the Public Meeting the overall project was, it seems, then next formally discussed at a meeting of the defendant council held on 8th August 2002, (see Bundle pages 426-428). The "Minutes" of a previous meeting held on 9th July (which I presume to be the Public Meeting) were signed as "a true and accurate record". However, I have not been referred to any document relating to the Public Meeting other than the "brief summary" and I certainly have no document said to comprise "Minutes" of the Public Meeting and I do not know whether any were produced? It may well be the case that the entry in the Minutes of the defendants' meeting on 8th August should have referred to the "Brief Summary" of the Public Meeting referred to above? If so, then the reference to "Minutes" may be a careless and misleading error. The Minutes of defendants' meeting, held on 8th August 2002, record under the side heading "correspondence" - "4. WDA grant application signed by the Chairman and to be sent back to the WDA". I have assumed that reference relates to the community appraisal project that is the overall project, though the Minutes don't state what specific grant application is being referred to and the reference may, therefore, be to some other grant application? However, I cannot see any reference in subsequent Minutes of the meetings of the defendant to any other matter for which a grant from WDA had been sought.

10. A copy of the grant application form relating to the overall project appears in the Bundle at pages 188-190. The application is dated but the actual date is unclear and may be either 15th July or August 2002. This uncertainty is because above the "8" in "15/8/02" appear a number "7". If it is July then it appears to have been signed prior to the approval given at the meeting on 8th August. If it was signed on 15th August then it wasn't signed at the meeting held on 8th August 2002 and, in any event, it was not signed by the Chairman of the defendant, as stated in the Minutes, but by "P Davies". The pro forma is signed in the section of the form headed "Declaration" which is completed as follows "I Pamela Davies duly authorised by Manorbier Comm Council apply for funding of £5,500 towards the cost of the project described in this application". The grant application form recites the name of the overall project to be "Manorbier Community Appraisal". In a section of the pro forma where the "Applicant's name and address" is required, it is completed "Mrs P Davies c/o 5, Windy Ridge, Manorbier". The signature at the foot of the form "P Davies" is not stated to be in a representative capacity though, as stated above the form does indicate that the signatory is "duly authorised by Manorbier Comm Council". I have seen no authority of the defendant council authorising Mrs Pamela Davies to sign the grant application form on its behalf? The signing of the grant application form by Mrs Davies therefore appears to contradict the authority referred to in the Minutes of the meeting of 8th August which, as stated above, state that the application was signed by the Chairman? At page 191 of the Bundle appears an official letter of the defendant, dated 15th July 2002, sent by Mrs Pamela Davies, and signed by her in her capacity as Clerk to the defendant, addressed to Mr Allison. It states, in terms, that the WDA grant application form was being enclosed with the letter "duly signed by myself" and also refers to the next meeting of the defendant council being scheduled for 8th August 2002. I have seen no authority given to Mrs Davies to sign the Grant application form and, indeed, as stated above, the Minutes of the meeting on 8th August suggest otherwise? The copy of the letter of 15th July 2002, appearing in the Bundle, is date stamped received by the Regeneration Unit on 19th July 2002 which confirms that it was sent in July prior to the August meeting? This sequence of events all appears somewhat irregular and contradicts the minute highlighted at paragraph 9 above from the Minutes of the meeting of 8th August 2002.

11. In any event, the WDA grant application form appears to have been forwarded to WDA, by Mr Allison after he received it from Mrs Pamela Davies. This is apparent from reading a copy of an e-mail from Mr Allison to Mrs Davies, dated 30th July 2002 (see Bundle page 193) by which Mr Allison states that he had spoken to WDA and received an unofficial indication that the grant application would be approved.

12. As stated above, the WDA grant application sought the sum of £5,500. It states in the section of the pro forma requiring a "Brief description of project (including aims and objects)", as follows "1. Hold public meetings to design a questionnaire. 2. Print and distribute questionnaires. 3. Collect results/analyse/ produce report. 4. Print Community reports. 5. Design and print community action plan." Of the above numbered aims and objects the pro forma then sets out an intention to hold Public Meetings and to design the questionnaire during the financial year 2001-2 and to print and distribute questionnaires and to collect results/analyse/produce report during the financial years 2002-3 and 2003-4. At page 189 of the bundle, which is a copy of the second page of the WDA grant application form, in the section headed "Detailed description of project - including potential benefits" it states "Design Community Appraisal, collect statistics and design an Action Plan to involve the Community in addressing environmental, business, transportation, health, youth and community issues. The potential for the community is tremendous both short and long term".

13. On 6th August 2002, the WDA wrote to Mrs Davies (without referring to Mrs Davies as being Clerk to the defendant) (see Bundle page 194). The letter notifies approval of the WDA grant application made by Mrs Davies and dated 15th July 2002. The letter indicates that a grant, equivalent to 80% of the eligible cost, in the sum of £4,640 had been approved and required that "the works are undertaken in full accordance with the details within the application dated 15th July 2002, together with all accompanying schedules of work and drawings" (I have seen none of the last mentioned documents and do not believe that any were, in fact, submitted). The effect of the letter is to require that the overall project be progressed as set out in the bold letters in paragraph 12 above. The letter also states that the "grant will become repayable if the purpose of the project changes or project assets are sold or otherwise disposed of during the next three years". (Quite how the latter two terms might be broken in this case is difficult to imagine?). Finally, the letter required an acceptance form, said to be enclosed with it, to be returned to WDA within 14 days failing which the offer of grant would lapse. The said acceptance form was signed by Mrs Davies personally on 8th August describing herself simply as "Clerk". If it was posted on the day of signing it would have been prior to the meeting held later that day?

14. At page 196 of the Bundle, there is an e-mail sent to Mrs Davies by Mr Allison, on 17th September 2002, which in part states as follows "Good news, the grant is ok. When the various parts of the appraisal are paid for the invoices are sent to WDA for payment. They have said they require the process completed by December. NO PROBS!!!". Given that the grant was approved in August 2002 and was to be completed, as required by WDA in its letter of 6th August 2002, on the timescale contained in the grant application form, it is difficult to make full sense of that part of Mr Allison's e-mail that "they require the process completed by December?

15. However, during the autumn of 2002, it is clear from the Bundle that work was being undertaken within the Manorbier community to settle the format of the questionnaire. It was the subject of much debate and alteration. This is referred to in a letter addressed personally to Mrs P Davies from Mr Allison, appearing in the bundle at pages 197/8, dated 23rd October 2002. In that letter Mr Allison states, in the third paragraph, that "As you are aware the offer of the grant is time limited and if individual members of the community keep coming up with amendments to the questionnaire the time will expire and the appraisal will be talked out of existence. I think it is important to realise that this is the beginning of the whole process. While I fully understand that members of the community will feel that nothing should be missed out, they need to be aware of the fact that most of the information they require will come out of the appraisal". On the second page of the same letter it states "One last point which must be borne in mind, is the fact that the questionnaire is "user friendly" and members of the community are able to complete it with ease. This will go a long way to encourage the maximum response rate, which as I explained at the Community Council and subsequent public meeting must be in excess of 65%" The letter also states that "I do need as soon as possible written consent from your chairperson to go ahead with the appraisal". The comments of Mr Allison concerning the percentage required being "in excess of 65%" contradict what he is reported, in the "Brief Summary" of the Public Meeting, where it is stated that "a 65% return is needed"? I can find no evidence that the WDA required any particular percentage return to be achieved and there is nothing in the grant application referring to any percentage requirement nor is there any in the letter from WDA, dated 6th August 2002, advising of the approval of the grant application. Against that background, it is unclear to me what exactly Mr Allison was seeking from the Chairperson at this stage? I received no statement, in the proceedings, from Mr Allison himself to assist me and must therefore rely upon my interpretation of his letter when considered against the other evidence adduced. I have formed the view that the most probable interpretation of this letter is that Mr Allison was becoming somewhat frustrated that the questionnaire was taking quite so long to finalise and that he wanted it approved as soon as possible to enable him to proceed to arrange for the questionnaires to be produced for distribution to further the overall project. In passing, I note that the references in Mr Allison's letter to the community refer to the community generally and not to the Community Council.

16. The next stage in the chronology is a reference in the Minutes of the defendant Council for its monthly meeting, in October 2002, to indicate that two Councillors were being urged "to submit their changes to the clerk ASAP in order that the alterations be sent to Alex Allison for his comments" (see Bundle page 432). In the Minutes of the November meeting of the defendant Council there is reference, in the "Matters arising", to the questionnaire where it states "The Clerk/Chairperson to query the status of the grant with Alex Allison and if this was satisfactory then confirmation should be given for the printing of the questionnaires. The questionnaires to be collected one week from delivery with any not collected to be left at the shop in Manorbier and Jameston. The Chairman to forward a letter with a signature on to Alex and also a front cover to be forwarded. All in favour of authorising this scheme as long as the queries were dealt with in a satisfactory manner". The first part of this Minute is difficult to understand since the grant had in early August, as stated earlier, already been approved and there had been nothing subsequent to suggest that its status was anything other than assured? From other references within the bundle it appears that the letter the Chairperson was to sign and forward to Mr Allison was referring to a "letter" which was to have been incorporated on the front cover of the questionnaire document setting out its objectives. The last part of the Minute is open to more than one interpretation. It may indicate that the defendant had passed some resolution to proceed with the community appraisal or that it was prepared to authorise it at a later date. There is no indication as to the nature of the "queries" being referred to in the Minute save for the status of the grant. However, as I have stated, I can see no reason to query the status of the grant at that date? The Minute is cryptic and leaves much to be desired.

17. On the day after the defendant's November meeting, on 6th November 2002, Mrs Pamela Davies wrote an official letter to Mr Allison on behalf of the defendant (see Bundle page 201). That letter includes the following "Can you clarify that the grant money which has been awarded to Manorbier Community Council from the WDA, what is the position if the 65% return is not achieved i.e. is the grant a flat rate grant or a repayable grant? Will the Council be liable if the 65% return rate is not achieved". The queries raised appear to ignore or overlook the letter received by Mrs Davies from the WDA dated 6th August 2002 (see Bundle page 194), to which I referred at paragraph 13 above. Mrs Davies' letter to Mr Allison also refers to a "few points" raised by one Councillor concerning the back page of the draft questionnaire and confirms that "Apart from those two points the Council were in agreement that the Appraisal Questionnaire should be printed in time for the Community newsletter".

18. My understanding of the letter of 6th November 2002 (page 201) is that Mrs Davies was interpreting the entry in the November Minutes that "All in favour of authorising this scheme as long as the queries were dealt with in a satisfactory manner", as being confirmation by the defendant that Mr Allison could proceed to produce the questionnaires.

19. I have looked for assistance in the interpretation to be placed upon the November Minute quoted in the last paragraph in the Minutes of the next meeting of the defendant Council held in December 2002 (see Bundle pages 436-440). Under "Matters Arising", in the December 2002 Minutes, there appears another somewhat cryptic Minute which states "The next stage of the Community Questionnaire to be decided when all questionnaires have been collected". This would appear to me to confirm that any queries that remained to be resolved following the November Meeting had been, by the time of the December Meeting, been satisfactorily dealt with in the intervening period enabling the form of the questionnaire to issued to the community to be finalised leaving Mr Allison to proceed to arrange for the questionnaires to be printed for distribution. There is another item appearing in the December Minutes to which I should refer, which is item 9 under the heading "December correspondence" (see Bundle page 438) which states "Invoice for printing Community Appraisal. The Clerk advised that on the advice of Alex Allison of the Regeneration Unit that this should be sent to the WDA for payment, as they were holding the money on behalf of the Community Council".

20. In response to Mrs Davies' letter to Mr Allison of 6th November (which was forwarded as an e-mail attachment to Mr Allison), he sent an e-mail the same day stating "The position is this. 1. The WDA grant is for the whole appraisal. If the 65% target is not reached then the unspent cash will be returned to the WDA. As long as there are invoices for the amounts spent there will be no problem. 2. If the appraisal does not reach 65% then there will be a need to quantify what support there may be for the projects identified in the original wish lists. This could be done through a visioning exercise but the quality of the information gathered will not be so accurate. Your Council will have NO LIABILITY for any shortfall if the 65% target is not achieved. 3. I'm afraid that it would be impossible to add any more to the questionnaire without deleting some of the points made by others members of the community. That would not be a choice I can make, but would be down to the group(s) that designed the questionnaire in the first place. I hope this answers your queries?" There is no evidence of any specific response by Mrs Davies to this e-mail. However, on 12th November, Mr Allison sent a further e-mail (see Bundle page 203) to Mrs Davies stating that he had then delivered the questionnaire to the printers for publication and that the printers invoice would be forwarded by the printers direct to Mrs Davies for onward transmission to WDA for payment.

21. On 4th December 2002, Mr Allison sent a further e-mail to Mrs Davies (see Bundle pages 204 - which is duplicated on page 205) stating "The deadline on the returns is up to you and your Council. I think that once you have more than the magic figure then contact one of the two companies I sent you to prepare your report. I think the Haverfordwest one should be favourite". It is unclear to me what communication this particular e-mail was responding to and if it was a written communication then it would appear that it may not been produced to the court. The term "magic figure" is undefined. I presume that the two companies referred to are the claimant and Dr Lyneth M Davies?

22. On 17th December 2002, Mr Allison sent a further e-mail to Mrs Davies (which also appears on page 204 of the bundle) asking Mrs Davies to contact a Mr Gordon Reed of WDA. The e-mail states "Will you please write to him telling him that the Appraisal is a Community One and NOT a Community Council appraisal. Will you please invoice him with just a letter asking for the payment and will you please say on the invoice/letter that it is for a stage in the Appraisal process and what stage it is i.e. printing the appraisal questionnaire, writing the report etc. If you have any probs give me a ring". It is unclear why Mr Allison chose to send that e-mail to Mrs Davies on that particular date. The content of the e-mail is, however, very significant to gaining a true appreciation of what is going on as it emphasises that Mrs Davies made clear when submitting the claim for interim payment of the grant that the overall project was a "Community one" as opposed to a "Community Council appraisal". It suggests that WDA may be forbidden to provide such grant assistance direct to a Community Council. Such a situation may also explain why Mrs Davies completed the WDA grant application form in her own name rather than "for and on behalf of the defendant"? No evidence has been adduced to explain the significance or importance, to WDA, of the overall project being a "community appraisal" as opposed to a "Community Council appraisal". Whatever its significance, it is clear that the overall project was certainly being driven forward by the defendant Council with the assistance of Mr Allison. However, if the appraisal project was not truly a Community Council project it begs a number of questions as to role of the various parties involved and, in particular, whether the defendant is to be regarded as a contracting party and whether the individual Councillors, serving at the time on the defendant Council, were simply acting in concert on an ad hoc basis, together with other interested members and organisations in the community, to achieve the appraisal objective for the benefit of the community generally? I identify these matters as being of fundamental importance in relation to the contractual issues to be decided in this case and I shall deal with these issues further after completing the chronology of all the significant events, drawn to my attention, when applying the law.

23. On 28th December 2002, Mrs Davies dispatched an official letter on behalf of the defendant Council to WDA, (Bundle page 207). That letter, following the advice of Mr Allison as set out in his e-mail of 17th December (set out above) states in express terms "I am writing to confirm that the Community Appraisal is a Community Appraisal and not a Community Council scheme". The letter goes on to request that WDA arrange to make a payment to Pembrokeshire County Council in respect of the cost of printing the questionnaires. It will be recalled that there was no formal resolution recorded in the Minutes of the meeting of the defendant Council at its December meeting, held on 3rd December 2002, to pay the printing charges. The Minutes only contain a reference to the fact that Mrs Davies had been advised by Mr Allison to arrange for payment to be made to PCC by WDA. The Minutes record that "as they (WDA) were holding the money on behalf of the Community Council". This Minute does not sit comfortably with the letter of 28th December to WDA, written by Mrs Davies on Council letterhead without the prior knowledge of defendant Councillors, (partially set out in bold print above)?

24. It appears from the Minutes of the defendant Council's February meeting (copied in the bundle at page 442) that the defendant held three meetings during January 2003. However, no copies of any of those Minutes have been produced to the court. I have assumed therefore that the overall project was not discussed at any of those meetings thus making the disclosure of those Minutes unnecessary? So far as the Minutes of the defendant Council held on 4th February 2002 are concerned (copied at bundle pages 441/444), there is only one entry concerning the overall project and that is the last entry in the Minutes, on page 444, where it states "6. The Clerk had been advised by Alex Allison to invoice the WDA and claim the grant money before the end of March. All present agreed the Clerk should proceed". The Minutes give no indication as to the nature of the invoice being referred to nor do the Minutes appear to reflect that any formal resolution of the defendant was called for or passed concerning the matter? Once again, the Minutes appear somewhat cryptic.

25. Following Mrs Davies' letter to the WDA of 28th December 2002 (requesting that WDA pay the printing charges raised by PCC), the next communication in the court bundle is that between Mrs Davies and Mr Allison that occurred on 8th January 2003 (see bundle page 208 - duplicated at 238A). This is an e-mail from Mr Allison to Mrs Davies enquiring how the appraisal was going. The e-mail continues "The Company in Haverfordwest who will be doing the data entry and report writing are asking when they will have the completed questionnaires. The lady you will be dealing with is Debbi Garside, her telephone number is 01437 766441. Will you ring her as well as me when you have passed the magic number". There is no evidence of any reply to that e-mail prior to Mr Allison sending a further e-mail to Mrs Davies on 22nd January 2003 (see bundle page 209) in the following terms "Hi Pam. Do you remember we discussed the options for preparing your Community report? Will you give Debbi Garside a ring on 01437-766441. She is keen to find out if they have the job. How are the questionnaires coming in. I am checking, and I have asked the finance department to let me know how many of the houses in your area are holiday homes. I forgot to mention that they are usually left out of the equasion when we are counting the percentage returns. They are often as much as 30% of houses in the community. That should help." Mrs Davies responded by e-mail on 27th January 2003 (see bundle page 210) confirming that she would telephone Mrs Garside and stating "Alex I saw Pat on Thursday of last week and she told me that unfortunately the Council Finance depart can only find 16 houses which are registered as holiday homes…..Have also e-mailed the Jane Stokes from the WDA to see is she will allow me to send an invoice to claim the whole sum of money. Just a thought if she will allow us to do this we have a newsletter due out again in March it would be a good time to write a short article urging more people to complete the questionnaires and tell them about the schemes possibly that could be funded on the strength of the information gained." The only part of this e-mail to which Mr Allison responded was the first part relating to the number of holiday homes. On 31st January he e-mailed (see bundle page 211) to indicate he was liaising with the PCC Revenue Section to check the number.

26. On 4th February 2002, Mrs Davies received a reply to e-mails she had sent to a Jayne Stokes of WDA enquiring as to whether the whole of the grant monies may be released. Jayne Stokes replied (see bundle page 212 - duplicated at 213) "You will need to claim the whole amount before the end of March 2003. However, I shall need a copy of the final report and advice that the work has been completed before payment." It is quite clear that WDA were not exerting any pressure upon Mrs Davies to draw down the remainder of the grant money at the time and there is nothing apparent in the evidence presented to the court as to why Mrs Davies should have wished to draw the grant money down before the end of March 2003? Indeed, if one refers back to the grant application form and the letter of approval from WDA, the overall project was to have continued during the 2003-4 financial year.

27. The next documents copied in the court bundle, at page 214 (and duplicated twice at 215 and 216), are copies of two e-mails passing between Mr Allison and a Mr Nick Johns. The format of the e-mails suggests that Mr Johns also worked for PCC. The e-mail from Mr Johns suggests that there were 99 holiday homes in the Manorbier community area inclusive of the outlying smaller villages and hamlets. This exchange obviously follows on from the earlier indication given by Mr Allison that holiday homes could be excluded when calculating the percentage of questionnaires returned. If Mr Johns' suggestion that as many as 99 houses in the community were holiday homes is correct, and 600 questionnaires had been delivered, then it may have been appropriate to calculate the 65% against a total of 501 homes not 600 homes. If so then 60 to 65% would amount to between 300 and 325 completed questionnaires.

28. On 11th February 2003, Mrs Davies e-mailed Mr Allison (see bundle page 217 - duplicated at 218) apparently attaching a draft invoice for WDA. The e-mail reads "Have typed an invoice to send to the WDA - Can you just cast your eye over it for me as I don't want to say the wrong thing to the WDA and wreck the chances of having the money sent us before the end of March. Any changes please let me know. Pam" In reply, Mr Allison stated simply "That's fine.. Don't forget to sign it". There does not appear to be a copy of the aforesaid invoice in the court bundle?

29. The next page of the court bundle, page 219 (duplicated twice at 220 and 221) there are copies of an exchange of e-mails between Mrs Davies and Mr Allison, dated 18th February 2003, together with a copy e-mail from Mr Allison to Councillor (as he then was) Martin Davies. The exchange between Mrs Davies and Mr Allison informed the latter that Mrs Davies held "about 100 (completed questionnaires) with about 20/30 ish still with Councillors". The e-mail from Mr Allison to Councillor Davies concerned an article Mr Davies was preparing for the Council newsletter and states "I would explain in the newsletter how many have been returned, what the target is, and that there are a number of projects in progress within the community that will depend on the results of the appraisal to get funding. This is a way of attracting funding that could potentially benefit the whole area from young people to elderly. I can't impress how important it is that we reach the 65% target". It is clear that the rate of return of the completed questionnaires from members of the community was quite slow and that the object of the article being prepared by Councillor Davies for the newsletter was to encourage a greater response.

30. On 24th February 2003, the WDA responded to Mrs Davies' enquiry about the release of the balance of the grant monies. The reply appears on page 222 of the bundle and though addressed to "Mrs Jones" it is clearly directed to the Clerk of the defendant Council who was then Mrs Pamela Davies. The WDA e-mail indicates that the final tranche of the grant money could not be released until the report had been completed. It continues by indicating that the grant had been transferred to the next financial year and requests that the final report be submitted with the final invoice to claim the balance of the grant monies.

31. Adverting, for a moment, to the statement of Mrs Garside (found at page 20 of the bundle) at paragraph 8 it states that, in February 2003 she was requested to prepare an updated quotation "for Manorbier Community Council in relation to the Manorbier and District Community Appraisal." There does not appear to be any written document requesting such an update (at least I have not seen one). A copy of the updated quotation does appear in the Bundle at 27(4) and 27(5). That updated quotation was sent as an e-mail attachment to Mrs Davies on 25th February 2003 copies of which appear in the court bundle at pages 27(6) and 223. The e-mail from Mrs Garside states, under a heading of "Manorbier Community Appraisal Quotation", "Hi Further to our telephone conversation yesterday. I attach a quotation for the above mentioned project. As mentioned, if we could have a decision asap we can schedule the work in. Assuming our quotation is acceptable, and as each 100 surveys will take in excess of 40 hours to input, we would like to start as soon as a good proportion have been returned rather than waiting until the survey results are complete".

32. It is clear that the e-mail referred to immediately above was then discussed at the next meeting of the defendant Council, held on 4th March 2003. The Minutes of that meeting appear in the court bundle at pages 445-448. Under the heading of "Correspondence", at item 2, appears the following "A quotation had been received from Debbi Garside for inputting the completed questionnaires. The Clerk to advise that the Community Council do not wish to proceed until the 65% target of completed questionnaires has been received." The Minutes of that meeting also include a short note (bottom page 446) "Comments noted from the WDA re Community Appraisal" which I take to be a reference to the e-mail from WDA referred to at paragraph 30 above.

33. Following the Council meeting of 4th March 2003, Mrs Pamela Davies sent an e-mail to Mrs Garside on 11th March (see bundle pages 27(6) and 223) stating "Debbie - the quotation received from yourself was discussed at last Tuesdays meeting and at present the Community Council do not want to commit themselves until we have received the 60/65% completed questionnaires back. Will keep your invoice to hand and hopefully will be in touch with you late Mid Spring". The reference to "invoice" is clearly a mistake by Mrs Davies and should have referred to the updated quotation. Mrs Garside acknowledged that e-mail the same day indicating that she looked forward to hearing from Mrs Davies in the future.

34. So far as the meetings of the full Council are concerned, everything then appears to have gone quiet for nine months. There are no Council Minutes in the court bundle referring to the overall project until December 2003. However, there were exchanges by e-mail between Mrs Pamela Davies and Mr Allison in the autumn of 2003 (see bundles pages 231-236). At page 231 there appears an e-mail sent by Mrs Davies enquiring of Mr Allison "What is the lowest number of questionnaires we need. How will you arrive at the total - we deliver 580 community newsletter some of which are delivered to holiday homes. We need the lowest number possible as we are not doing too well on completed questionnaires". This is a very surprising enquiry given the suggestion that the 65% return was a term of the contract. The e-mail also appears to shed doubt on the figure of 600 referred to earlier (see paragraph 4 above). The reply to this e-mail from Mr Allison is also surprising as it states "I thought the figure should be 365. I can't understand how you appear to be so short of the total. I thought you only needed another 80 or so?" A return of 365 questionnaires would if intended to be a 65% number equate with only about 562 questionnaires being distributed and does not marry up with any of the figures previously mentioned even if a 60% calculation is applied.

35. On 5th October 2003, Mrs Pamela Davies dispatched another e-mail to Mr Allison, with a copy to Councillor Pat Griffiths. It refers to Mrs Davies having received "another batch of completed questionnaires" that day bringing "the number of completed questionnaires to 161". The e-mail concludes "I believe you are in the changing rooms on Wednesday - it you want to pop up and take the completed ones's I am here most of the morning" It is unclear whether Mrs Davies is inviting Mr Allison or Councillor Griffiths to collect the completed questionnaires nor it is clear for what purpose. There is, however, evidence from Mrs Pellowe that completed questionnaires were being delivered to the claimant at this time ready to be processed. Mrs Davies' e-mail also seeks advice from Mr Allison about an e-mail Mrs Davies had received from WDA raising a query about an invoice it had apparently received from Mrs Davies for the printing of more questionnaires pointing out that one printing invoice had been paid in November 2002. The reply from Mr Allison, on 7th October 2003, states "I would suggest that you firstly inform her (WDA) that the reprint had been agreed beforehand and there was a shortfall in the actual numbers required. Secondly I would suggest that it may pay to have a word with Pat Griffiths about some suggestions I made as to how to achieve the target i.e. photocopy some." The e-mail concludes by stating "I wouldn't start the data entry until I was closer to the target if I were you". The latter remark certainly indicates that starting the processing of the questionnaires was an option open without attaining the so called target. The first part of the reply seems to me to be suggesting that Mrs Davies tells lies to the WDA and if the reference to "photocopy some" refers to completed questionnaires (and it is difficult to come to any other conclusion) the suggestion would destroy the integrity of the overall project and be tantamount to fraud. There is however no evidence that the suggestion was taken up! There is a further exchange of e-mails on 1st December 2003, when Mrs Davies again raises a query over the "60-65% return rate" to which Mr Allison replies "65% of 600 - 390". This reply contradicts his e-mail of 19th September 2003 referred to at paragraph 34 above?

36. On 9th December 2003, the defendant held one of its regular meetings but, on that occasion, the Clerk to the council, Mrs Pamela Davies was not able to attendance as she had, shortly before that meeting, been involved in a car accident. In the absence of the Clerk the Minutes of that meeting were taken by Councillor Thompson (now Pellowe). What is recorded to have happened at that meeting has sparked great disharmony and controversy between members of the Manorbier Community Council. In the court bundle, at pages 457 and 458 is a copy of the original hand written notes made at the meeting on 9th December 2003 by Mrs Pellowe. The relevant part of those notes, in the context of this case, appears at page 458 (duplicated at page 113). It reads "Community Questionnaire - Enough copies completed to start evaluation and processing. Grant available. It was proposed by Sharon Davies and seconded by Mark Meyrick that the money be released." In a written statement prepared by Mrs Pellowe on 12th May 2006, (which is not contained in the court bundle but handed to me at the hearing), Mrs Pellowe states that the day after the meeting on 9th December 2003, that is on 10th December 2003, "the Clerk called down to my home and I explained exactly what had happened and gave her my notes. These were later typed by her and produced at the next meeting which I did not attend but the wording had been changed. Had I been at this meeting I would have challenged it". The official Minutes of the meeting of 9th December 2003 were prepared by Mrs Pamela Davies and copies appear at pages 455/456 of the court bundle. Under the heading "Community Questionnaires", on page 456, the Minutes state "The target figure has been reached and the data could now be processed. Proposed by Cllr S Davies and seconded by Cllr M Meyrick that the Clerk should contact the WDA to request that the funding (money) should be released to the Community Council". Those "official" Minutes were produced and approved at the next meeting of the defendant Council held on 13th January 2003 and signed off by the then Chairman, Councillor David Morgan. However, they were signed only after deletion, from the original typed version prepared by Mrs Davies, of the words that I have underlined above and after adding the word "money" I have shown inserted in brackets. The official Minutes of the January meeting of the Council confirm that Mrs Pellowe had tendered her apologies for absence as had Councillor Sharon Davies. Five of the Councillors who attended the December meeting were present at the January meeting including Councillor Meyrick who seconded the resolution recorded in the notes taken by Mrs Pellowe. I note that Councillor Patricia Griffiths was present at both meetings.

37. At the hearing I heard oral evidence from several of present and past Community Councillors. I heard from Mrs Pellowe, Councillor Patricia Griffiths, Councillor A L Wales and Mr (formally Councillor) David Morgan. In written account of Mr Morgan of what happened at the meeting on 9th December 2003 (contained in a written statement that does not appear in the court Bundle but which the parties agreed should be admitted into evidence on the second day of the hearing), Mr David Morgan states "I recall that during the meeting Cllr P Griffiths stated that the required number of questionnaires had been reached and I understood that she had started taking them to I.C.T. I took this to mean that between the questionnaires that she had collected and those that she understood the Clerk to hold that the 65% return had been achieved. Cllr P. Griffiths had hoped to collect the Clerk's questionnaires at the meeting but obviously due to the circumstances they were not there. I believe that all the councillors there, with the exception of Cllr Malcolm Calver, congratulated her on her success and hard work, councillors were relieved and pleasantly surprised that the end of the appraisal was imminent and that it would be completed within the financial year. The Council endorsed Cllr Griffith's actions and agreed to proceed and draw down the necessary finances from WDA, unfortunately, the necessary forms had not been sent along by the Clerk. On the Thursday morning I spoke to the Clerk on the phone, she said she had received Cllr L Thompson's minutes. She had also that morning given Cllr P. Griffiths her questionnaires and some documents for me to sign. She thought Councillor P Griffiths was coming up to the farm (Mr Davies lives on a farm) shortly. Cllr P. Griffiths did not come up to the farm on the Thursday….Cllr P Griffiths turned up late and in a hurry on Friday and I signed two documents a WDA form for drawing down the remainder of the grant and an appended acceptance of quotation form from I.C.T. which I presumed was supporting evidence". Mr Morgan confirmed the above account to be true at the hearing. His account provides a deeper insight into what happened at the December meeting. At the hearing, Mr Morgan told me that he recalled that the discussion at the December meeting had been very argumentative. He said he had favoured proceeding with Dr Lyneth M Davies of Aberystwyth but that Councillors Pat Griffiths and Calver, whom he said had been arguing at the Meeting, were in agreement that ICT Marketing Ltd should proceed with its part in the project. Mr Morgan said that he believed that the claimant had been given the contract for its part in the project prior to him becoming Chairman of the defendant Council in May 2003 but he could not recall there being any written contract document other than the updated quotation and the document signed by him (as referred to in the extract from his statement above) after the meeting on 9th December 2003. In his written statement he states "I do not believe that the acceptance of contract was an instruction to start processing". Mr Morgan then goes on in his written statement as follows "It soon became clear that there had been a misunderstanding between the Clerk and Cllr P Griffiths and between them they did not have as many completed questionnaires as they had at first thought. Amongst other reasons a number of uncompleted questionnaires had been put into the wrong box and the Clerk had counted them as having been completed. This created a heated debate in the council. I am of the opinion that the majority of the council, including Cllr P Griffiths had genuinely believed that the necessary number of completed questionnaires had been completed, and were shocked and dismayed to find out how large the apparent shortfall was. In January 2004 ICT was told to stop processing questionnaires due to the shortfall, though I believe that they had already done all those that they had been given. Steps were taken to secure the WDA grant so that it would not be lost at the end of the financial year. In the meantime the council set about getting more completed questionnaires. This process was still going on when I left the council in May. Up until that point as far as I know no more questionnaires had been delivered to ICT and I cannot recall them being asked to restart the processing."

38. At the commencement of the hearing on 9th October 2006, the claimant made application to admit into evidence a statement contained in an e-mail produced by Mrs Elizabeth Iona Pellowe (formally Councillor Thompson) submitted by Mrs Pellowe to the defendant's solicitors on 12th May 2006. Mr Pratt said that the defendant had received the statement from Mrs Pellowe but had decided not to call Mrs Pellowe on the basis of what was known to it at that time. As Mrs Pellowe was present in court and willing to take the witness stand to be cross-examined on her statement ruled that her statement of 12th May could be admitted into evidence. In that written statement, Mrs Pellowe states that she has been a Manorbier Community Councillor for 25 years. Mrs Pellowe recalls attending the Public Meeting in 2001 addressed by Mr Allison. Mrs Pellowe recalls that Mr Allison had told the Public meeting "that some communities had submitted these with as low as a 28% return but that the Regeneration Unit would like a 65% rate to give more validity. However, he stated that this was not mandatory, only desirable". Mrs Pellowe recalls that a previous community appraisal had been undertaken in Manorbier in 1996. On the question of allocating its part in the project, Mrs Pellowe states "It was decided by the full Council to use ICT Marketing because the lady from Aberystwyth had been used before to collate the appraisal which had taken a long time. (in 1996) Also ICT were more efficient and cheaper".

39. In relation to the meeting on 9th December 2003, Mrs Pellowe confirms that she took notes for the preparation of the Minutes of the meeting in the absence of Mrs Pamela Davies. In her written statement Mrs Pellowe confirms that Councillor Pat Griffiths informed the meeting on 9th December that the claimant was anxious to begin collating the questionnaires as sufficient had been received to make a start and the claimant had staff available for the processing to begin but that her revised quotation had not yet been signed by way of acceptance and returned. On the basis that it was then hoped that more completed questionnaires would be returned the meeting resolved to proceed to process the questionnaires. Mrs Pellowe denies that Councillor Griffiths told the meeting that the target figure had been reached; She says that Councillor Griffiths told the meeting that Mrs Pellowe goes on to state that the form authorising the claimant to proceed was signed at the meeting by the Chairman to be returned to the claimant via the Clerk to the Council. The contention that the acceptance of the revised quotation was signed at the meeting clearly conflicts with the evidence of the Chairman himself. In a document attached to Mrs Pellowes' e-mail of 12th May 2006, paragraph 9, Mrs Pellowe states, in relation to the acceptance form, that Councillor Griffiths "passed it across the table in the Community Council meeting to Cllr David Morgan…Cllr Morgan took it and then Cllr Calver started arguing about the 65%" - no mention is made here of the document being signed at the meeting. In oral evidence at the hearing, Mrs Pellowe again asserted that the form was signed by Mr Morgan after he, as Chair of the meeting, had asked those Councillors present if it was there wish that it be signed. Mrs Pellowe said that there had been unanimous approval by those present that the form be signed. The Chairman was to be hand the signed acceptance for relating to the updated quotation to the Clerk but then added that she did not know if he did - it was not clear whether Mrs Pellowe was referring to the signing of the form or its handing over to the Clerk at this point. Mrs Pellowe also states that the following day she met with the Clerk, Mrs Davies, and handed to her the notes she had taken at the meeting. Mrs Pellowe was not at the next Council meeting, in January, and did not see the formal draft Minutes produced by the Clerk from her notes prior to the Minutes being approved, with amendments, at the defendant's January meeting. Mrs Pellowe asserts that she would have objected to the Minutes being approved with the amendments shown on page 456 of the bundle as she does not agree that they reflect what happened at the December meeting and it was not for the Clerk to edit the notes she had taken but should have reproduced them for the approval of the meeting. Mrs Pellowe asserts that the Clerk was aware that the claimant had been instructed to proceed with its part in the project.

40. Mrs Pellowe says that the Council decided, more than two months prior to the meeting on 9th December 2003, to pass the completed questionnaires it had received to the claimant to enable it to begin collating them on a date to be agreed. Mrs Pellowe says that she personally assisted the Clerk in the transfer of the completed questionnaires to the claimant by collecting them from the Clerk, counting those received which amounted to 184 including 28 that had not been completed, and then delivering them to Councillor Griffiths to deliver to the claimant.

41. In relation to the involvement of Mr Allison, Mrs Pellowe told me, in evidence, at the hearing that her understanding is that the PCC were acting as facilitators in relation to the overall project and that no competitive quotations had been sought for the printing of the questionnaires which had been simply left to Mr Allison to arrange. Mrs Pellowe said that the Council had not always followed its formal procedures in relation to moving forward the overall project and that the Council members were dependent upon their Clerk to advice as to procedures to follow.

42. In evidence to the court, Councillor Patricia Edwina Griffiths, told me that she had been a Community Councillor at Manorbier for nearly 27 years. Councillor Griffiths confirmed that she had raised the overall project at the meeting on 9th December 2003. She said she knew that the claimant was keen to proceed with the processing of the completed questionnaires and was concerned that the WDA grant might be lost if the overall project was further delayed. Councillor Griffiths denied stating at the meeting that 65% of the issued questionnaires had been returned completed, or that the "target figure" had been attained, but that enough had been returned for the claimant to start its part in the project. Councillor Griffiths said that her understanding from Mr Allison at the Public Meeting had been that the 65% return was no more than a percentage that they should aimed to achieve. Councillor Griffiths said she had brought the updated quotation acceptance form to the meeting and handed it to Councillor Morgan to sign when the meeting agreed that the claimant should proceed with its part of the project. Councillor Griffiths considered that the claimant had fulfilled its part in the project and should have been paid.

43. Councillor Griffiths confirmed that she had delivered the questionnaire forms to the claimant. She said that it had been a convenient method of delivery as she had other business with the claimant at the time. Councillor Griffiths also said that the distribution of the questionnaires had, in her view, left much to be desired and that after the initial distribution a further 250 had been distributed when it was discovered that one part of the community had not received them and a bag of blank questionnaires had been found in a hedge.

44. Councillor Anthony Leonard Wales, the current Chairman of the defendant Council was called to give evidence at the hearing by the defendant. Councillor Wales' written statement is found at page 28 of the court bundle. He became a Community Councillor with the defendant in September 2003 and became Chairman a year later. He was present, as Council member, at the meeting on 9th December 2003. It was the first time he recalls the overall project being discussed since he became a Councillor. He recalls the discussion at the meeting and mention of a target figure being reached. He does not mention in his statement who mentioned a target figure? He recalls there being a sharp exchange between Councillors Griffiths and Calver about the exact number of returned questionnaires. He says he did not participate in the discussion "as the appraisal and questionnaire project had already been decided upon prior to me becoming a Council member". He does not recall that the Council agreed to instruct the claimant at the meeting only that it had been agreed to claim the WDA grant monies in relation to the overall project. Councillor Wales denies that the meeting authorised Councillor Morgan to sign the updated quotation for it to be returned to the claimant.

45. Councillor Wales said that he recalled asking Mr Allison at a meeting in 2003 about the number of completed questionnaires that would be required and being informed that a 60-65% return would be required or "the project would die". He said that, at the time he thought the percentage requirement was part and parcel of the contract. He said it was not until February 2005 that having studied the documents he found that the figure was irrelevant. He said that it was his understanding that the overall project was a "Community Council project and not just a Manorbier Community Appraisal".

46. Councillor Wales conceded in oral evidence that the procedures adopted by the Council at its meetings were not always thorough and accurate and that the Minutes were, on occasion, "rather sparse".

47. On the morning of 22nd January 2004, Mrs Davies sent an e-mail to the claimant (see bundle page 239 - duplicated at 240) saying "Just wondered if you can give me a progress report on the questionnaires - have they arrived with you yet? If they have how many do you have and when will you finish processing them? I need to give a progress report to the Council on when we will finish the project". Mrs Garside replied the same day saying "We are still awaiting surveys from Malcolm Calver (according to Pat they are on their way). We have received and keyed 156 surveys so far and have staff waiting for delivery of surveys. If you could give me some sort of timescale I would be grateful". There is no apparent reply to that e-mail.

48. However, at page 241 there is a letter from Mrs Davies to the Chairman of the defendant Council indicating that Mrs Davies believed that "information reported to the Council has been reported inaccurately". The letter goes on to state that "I understand that at the Community council meeting held on the 9th December 2003, which I was unfortunately unable to attend, it was reported by Councillor Griffiths that enough copies of the Community questionnaire had been received and that the remaining grant money could now be released". The letter then refers to the e-mail received by Mrs Davies from the claimant on 22nd January and the 156 questionnaires processed to that date and points to the 390 figure and pointing out that "this therefore means that there is potentially a discrepancy in excess of 200". Mrs Davies calls for Councillor Griffiths to explain the "discrepancy in numbers and to immediately hand any questionnaires that may be in her possession or control to myself". The letter concludes by indicating that Mrs Davies proposed to report the situation to "the relevant authorities tomorrow".

49. On page 242 of the court bundle there is a copy of a letter sent by Mrs Davies to Mrs Garside dated 28th January 2004. The letter seeks information from the claimant and asks two questions. First, it asks how many completed questionnaires were held by the claimant and then states "As you are aware the WDA grant money is dependent on a 60%/65% return rate which equates to 390 completed questionnaires being returned. Have you had any further completed questionnaires since your e-mail on the 22.1.04?" The two questions raised are "Do you have to produce a declaration/form to the WDA to prove that you have processed the 390 questionnaires in line with the 65% return rate?" and "You mention that the processing has already taken place. Can you confirm on whose authority the processing was started".

50. The letter referred to above was responded to by e-mail the following day. The reply confirms that the claimant had received 156 questionnaires. It goes onto state that "We are contracted to Manorbier Community Council and therefore do not provide any information to any other organisation unless instructed to by the Council". In answer to the questions it states "Confirmation of acceptance of our original quotation was received signed by Mr D Morgan. This was received prior to data input as part of our quality assurance and contractual management procedures. A copy of which can be made available on request. Can you inform me whether we will be receiving any further completed questionnaires and if not can we proceed to analyse the data and write the report". This e-mail was then set out in a confirmatory letter on 2nd February 2004 (see bundle page 244). With the letter Mrs Garside sent a copy of the acceptance form signed by Councillor David Morgan, a copy of which is found at page 245 of the bundle. The said acceptance form includes "Completion Date: Early 2004 (ASAP)".

51. There follows in the bundle (see pages 246/7) two communications addressed to Mrs Davies from WDA enquiring as to the amount that was to be claimed in respect of the grant and that any claim was required to be submitted by 8th March 2004. Though it is not copied in the court bundle it appears that Mrs Davies then forwarded the updated invoice received from the claimant to WDA as there is an e-mail acknowledging receipt on 20th February 2004 (see bundle page 249). That e-mail asks when the final invoice was expected. There is no copy of any reply to the last e-mail in the court bundle but an e-mail appearing on page 256 indicates that there had been telephone contact between Mrs Davies and WDA and an e-mail stating "following confirmation from Alex Allison at Pembroke County Council, please could Manorbier Community Council invoice WDA for the remaining amount of the grant - £4554.66…as a matter of urgency".

52. On 1st March 2004, Mrs Davies e-mailed Mr Allison informing him of the number of questionnaires processed by the claimant and enquiring whether the 156 processed would "be good enough indication of the needs of the community". The reply, from Mr Allison states "NO. It will need 65%. I thought Pat Griffiths was dealing with this? I have passed that info on to her and I am waiting for her to get back to me". However, on the same date (1st March) Mrs Davies wrote again by e-mail to the claimant stating (see bundle page 253 - duplicated at 254)) "Can you estimate how long it will take you to compile a report from the information that you have already compiled from the Community Questionnaires. We will probably need this report this week together with an invoice ready to submit to the WDA as their year end is middle of March for all invoices to be paid". Mrs Garside, for the claimant, responded by e-mail the same day stating "I am afraid it is impossible to write a report of the nature required (10-12000 words) in less than a month. However, I am happy to provide the invoice for work to date and work contracted by mid-March as required by the WDA. Please let me know if you wish to proceed."

53. The next communication copied in the court bundle is a letter from Mrs Davies to the WDA, dated 3rd march 2004, enclosing an invoice (see court bundle page 257). At page 258, is a copy of the said invoice which is not from the claimant but is an invoice purporting to be from the defendant Council itself to WDA claiming £4554.66 for the "processing of completed community questionnaires, writing a report and any other associated works to carry out a community appraisal - Total due to Manorbier Community Council £4554.66". An e-mail of the same date from Mrs Davies to WDA (see bundle page 259) informs WDA "all went well last night and the Community Council authorised me to claim the remaining £4554.66 grant from the WDA in order to complete the appraisal process". I have referred to the Minutes of the defendant Council's meeting held in March 2004. They appear on page 468A of the court bundle. That meeting was held on 2nd March 2004. Those Minutes record that a resolution was passed by the Council to forward the invoice from the defendant and to hold the grant money received until the "appraisal processes had been completed and the money spent". The minutes also record that the defendant had resolved to arrange for a further 250 questionnaires to be printed "for completion by new residents within the community".

54. On 16th March 2004, the WDA forwarded to Mrs Davies a "monitoring form" relating to the request for payment of the grant requesting, amongst other things, "evidence of expenditure" (see bundle page 264). Mrs Davies immediately referred to Mr Allison asking for a meeting and stating "I am not confident enough to complete it myself as I don't want to give the wrong information to the WDA to scupper the grant money". A copy of the monitoring form was sent direct to Mr Allison by WDA with a letter on 18th March 2004. that letter concludes "In order to close this project, and in light of the recent issues regarding the Council, could you please ensure that the monitoring form is returned to myself as soon as possible, together with a copy of the Final action Plan when completed." It is apparent from page 268 in the bundle that Mr Allison then telephoned the WDA and agreed that he would hold the monitoring form and fill it in "once the appraisal is complete". At page 270 of the court bundle there is an e-mail, dated 20th March 2004, indicating that the grant monies were received by the defendant from the WDA on that date. Mrs Davies informed Mr Allison of the receipt of the monies on 22nd March 2004 and at page 271 of the bundle there is an e-mail from Mr Allison sent on receiving the news stating "Great. Just pay the bills and leave the end game to me". There is no indication what Mr Allison meant by this remark?

55. Whilst these exchanges were taking place, the defendant Council held a meeting on 18th March 2004 which was not quorate as only three councillors attended (see court bundle page 468E). It proceeded as a discussion group only but its Minutes state a number of people had completed more than one copy of the questionnaires distributed and suggested that the questionnaire might be amended to deal with other matters.

56. The next document in the bundle, at page 272, is dated 18th January 2005. It is a letter to the Clerk, Mrs Davies, from WDA requesting a copy of the defendants' accounts and a copy of any final report relating to the overall project. At page 273 of the court bundle there is a copy of an e-mail sent to Mrs Davies from Mr Allison stating that the draft appraisal report was ready and enquiring how many copies of the report Mrs Davies would require for the Council to enable them to adopt it. At page 274 there are copies of a series of e-mail communications between the claimant and Mr Allison concerning the claimants' report one of which requests that Mrs Garside send her Company's invoice with the report when sending copies to Mrs Davies. It seems that the completed report extended to 17000 words and 55 appendices. The claimant issued its invoice then on 8th February 2005 for £4578.98.

57. there then appears in the court bundle (see court bundle pages 288/9) a copy letter, dated 10th March 2005, sent by Mrs Davies to Councillor Wales (who by then had become Chairman of the defendant council). The letter indicates that Mrs Davies had received been informed that the final report had been prepared by the claimant but that Mrs Davies had received no communication concerning the overall project since the previous March and that she had "presumed the project had ceased" Mrs Davies professes surprise at having received the e-mail from Mr Allison. Mrs Davies points again to "the importance of reaching the return rate of 65%". The letter also contains the following paragraph "I am also quite sure that at no time during the course of Council Meetings during the last 2 years can I recall the Community Council authorising ICT to commence the data processing work. However, I am conscious that there is a document in existence with the signature of an ex-councillor, which would seem to authorise ICT to commence the processing work. I do not recall this document being discussed at any Council meeting. I would also ask you and the Council to bear in mind that we do not know under what circumstances this document was signed or the Councils current position as we are now aware of its existence". This last paragraph seems somewhat disingenuous given the letter received by Mrs Davies from the claimant dated 2nd February 2004 by which Mrs Garside forwarded a copy of her authorisation to proceed, signed by Mr David Morgan, in response to Mrs Davies' own letter seeking the information dated 28th January 2004 (See court bundle page 242 as referred to above). Mrs Davies would not have recalled the document being discussed as she did not attend the meeting on 9th December 2003 though Mrs Davies did prepare the draft "official" Minutes of that meeting from the notes taken by Mrs Pellowe. Mrs Davies also appears to be wishing to distance herself from the e-mail exchanges she had with Mr Allison after receipt of the grant money and her concerns about having received the monitoring form from WDA after which, it will be recalled, Mr Allison had written "Great. Just bank the cheque and leave the end game to me". I find that Mrs Davies could not possible have thought that the project had ceased as she alleges in this letter. Mrs Davies knew full well that she had banked the grant money received from WDA without the final report having been prepared and that the preparation of that report was a fundamental part of the overall project. I would seriously question the conduct of Mrs Davies and Mr Allison in relation to their dealings with the WDA concerning the grant monies and, in particular, if Mrs Davies truly thought that the project had ceased why did she not inform WDA and arrange to refund the unused part of the grant received? It is also surprising that despite Mrs Davies protestations it was Mrs Davies herself who advised how many copies of the final report would be required by the Council and it was Mrs Davies who collected them from the claimant!

58. At page 297 of the court bundle there is an e-mail from Councillor Wales to the claimant expressing surprise at Mrs Davies stance stating "she has been aware of the situation from day 1. If she really felt that this work was carried out without council consent, as the Clerk to the Council why did she not highlight this last February. The Clerk has at no time indicated to me that there was a problem with this contract" Councillor Wales was not asked to comment upon this e-mail at the hearing.

59. It appears that Mrs Garside then approached WDA herself concerning the fact that the Claimants' invoice had not been paid. The WDA wrote to Councillor Wales on 27th April 2005 indicating that it had "some very real concerns in that the WDA grant of £4554.66 was paid in good faith upon receipt of an appropriate invoice on 3rd March 2004, and that my understanding is that this amount remains deposited within the bank account of Manorbier Community Council". The letter also states "Through conversations with Mrs Garside and Alex Allison of Pembrokeshire County Council, and also through receipt of report material, I am satisfied that the Contractor (the claimant) was properly appointed and that the work has been undertaken in accordance with the application for funding to the WDA". The letter concludes by requiring confirmation that the grant money would be released to the claimant within 14 days failing which the WDA would reclaim the grant. It appears that someone within the Council referred matters to Police for investigation and the claimant was informed that payment would not be made until the Police investigation had concluded. There is a copy letter in the court bundle at page 303, dated 13th June 2005, from Mrs Garside to Mrs Davies stating that Mrs Garside had spoken to Police and been informed that the work carried out by the claimant had not been referred to Police but I have no other information to shed light upon what matters were referred to Police. However, the invoice remained unpaid.

60. I have now tracked what appear to be the salient events in the chronology. However, the documentation in the bundle does not clarify how it came about that the final report was prepared by the claimant in early 2005. Mrs Davies, in her letter to Councillor Wales (page 288/9) professes no knowledge of how it came about. Mrs Davies gave evidence at the hearing and a witness summary of her evidence was served beforehand. It appears in the bundle (see pages 52- 155). Mrs Davies adopted the witness summary at the hearing with some amendments. Those were as follows. In paragraph 18 (third line), Mrs Davies said that no contract was enclosed with the quotation. At paragraph 22 the word "monthly" needed to be deleted from the first line. At paragraph 24 the figure 365 needed to be changed to 390. At paragraph 26 is to be added that the letter was read out to the Council on 3.2.2004. At paragraph 30 the word "compile" should be "comply" and at paragraph 32 after the figure £4554.66 add "this figure was supplied by WDA".

61. At paragraph 8 of her witness summary, Mrs Davies, referring to Mr Allison's' address to the Public Meeting, states "He then stated that a 65% return rate for the Questionnaire would be required in order for the scheme to be a success". I note that Mrs Davies does not suggest that the 65% return rate was a condition of the grant funding and that, indeed, at that time no application for grant assistance had even been submitted to the WDA. At paragraph 11 of her witness summary, Mrs Davies suggests if the 65% return rate was not achieved then any "unspent" part of the grant would be repayable to WDA. However, the witness summary ignores the letter from WDA dated 6th August 2002 (see court bundle page 194) setting out the terms under which the grant application was approved which letter was signed by Mrs Davies, by way of acceptance, on 8th August 2002. It makes no mention of any required percentage return of the questionnaires.

62. At the hearing, Mrs Davies was referred to page 205 in the court bundle which is the e-mail from Mr Allison emphasising that the overall project was not a Council project but a Community project. Mrs Davies pointed out, in oral evidence, that at the outset of the overall project she had been new to the job of Clerk to the Council and did not appreciate that there was any difference between a Council project and a partnership project.

63. At paragraph 23 of her witness statement, Mrs Davies expresses an opinion as to what happened at the meeting on 9th December 2003 that no decision was made at that meeting to instruct the claimant. However, I find that there is overwhelming evidence that the updated quotation of the claimant was discussed at that meeting and that the meeting decided to accept it and the acceptance form was signed by the then Chairman, Councillor Morgan. Whether Mr Morgan signed that form actually at the meeting or after the meeting is immaterial as it is clear from the copy of the form in the bundle that it was signed by him and he has confirmed that to me himself. On this evidence I find that the opinion expressed by Mrs Davies at paragraph 23 of her witness summary is wrong.

64. Having heard both Mrs Pellowe and Councillor Pat Griffiths in evidence, I am satisfied that Councillor Griffiths did not refer to the target figure having been reached at the meeting on 9th December 2003. I was impressed by both ladies in the witness box and found that they gave their evidence in a forthright and assured manner. I accept that the notes made at the meeting by Mrs Pellowe reflect what happened and also that the updated quotation from the claimant was discussed and accepted at the meeting causing the Chairman to sign it. Mrs Davies told me at the hearing, in evidence, that she did not know that the acceptance form had been signed and indeed there is no evidence to suggest that in early 2004 Mrs Davies did know it had been signed. Mr David Morgan had assumed it would be sent to the claimant by the Clerk but there is no evidence that such was the case and it might well have found its way to the claimant via Councillor Griffiths as suggested in paragraph 28 of Mrs Davies witness summary. When questioned by Mrs Garside at the hearing, Mrs Davies said she didn't know what had given her the impression that the claimant had stopped work when she received the claimants' letter of 2nd February 2004. Mrs Davies conceded that no request to stop work had been made by the defendant.

65. Mrs Davies was questioned in relation to her e-mail of 22nd January requesting a progress report from the claimant and how long it would take to process the questionnaires (see page 239 of the bundle). Mrs Davies said that the e-mail had been nothing more than a fishing expedition and that she had inkling that something was going on but did not know exactly what. Having heard Mrs Pellowe, I am satisfied that she told Mrs Davies about it being agreed at the meeting on 9th December 2003 that the claimants' undated quotation had been accepted. It follows that I find that the e-mail sent by Mrs Davies on 22nd January was a genuine enquiry as to progress and not a fishing expedition. The decision to proceed had been taken at the meeting on 9th December 2003 and the acceptance form indicated that completion was required as soon as possible in 2004. When Mrs Garside asked, in her e-mail of 1st March 2004 I find that enquiry related to the preparation of the final report not to undertaking any of its part in the project as that was already underway.

66. The significance of the percentage return of completed questionnaires hangs large over the disagreement between the parties in this case. I have heard much evidence about it and I have carefully studied the written exchanges contained within the court bundle relating to it. Taking the evidence as a whole, I find that is more probable than not that the evidence of those who assert that the percentage was mentioned purely for illustration purposes by Mr Allison at the Public Meeting are correct. There is certainly no reference in any document from WDA to such a percentage return being required. The references made to percentages in the communications from Mr Allison are inconsistent on the point. In some places referring to 655, in others to 60-65%, in still others to "in excess of 65%. I accept the evidence of those who indicate that Mr Allison also stated that other projects had been completed on very much lower returns. Indeed there is no logical reason why 65% should be invested with some particularly meaningful significance. However, I find that the greatest flaw in the argument that the 65% return was required is that there is no clear evidence as to how many questionnaires were delivered. The questionnaires do no appear to have been numbered and there is no evidence as to how many were printed. In places, it is suggested that 600 were delivered but elsewhere, as referred to above, there is reference to other figures and also to some questionnaires not being delivered and others being thrown in the hedge and others being delivered to holiday homes and no clarification as to how many such home lay within the community and as to how their number might influence the way in which the percentages were to be calculated. There is also the point that a further 250 questionnaires were apparently produced for new residents in the community. It would be surprising indeed if as many as 250 new residents moved into the community within the short time span referred to in the documents. In short, there is no clear evidence (at least none has been produced to the court) that would have enabled anyone to accurately calculate any percentage return. It seems to me that having embarked upon the survey it was a matter for the organisers to decide when to process the completed questionnaires and for the author of the survey report to take account of the number of questionnaires processed when drawing conclusions from the results. I am reinforced in this finding by the indication given by the WDA that they would require an invoice for the processing work as the fewer questionnaires were processed the less cost would be incurred in undertaking the overall project. To my mind, therein lies the manner by which the grant funds are safeguarded. Accordingly, I reject the contention that there was any true significance in a 65% return. I find that it might have been hoped that a 65% return would be achieved it was nothing more than that and that it was open to the community to process as many or as few questionnaires as were returned duly completed in order to complete the overall project.

67. Mrs Garside gave evidence that whilst she had been informed of the aspiration to have 390 completed questionnaires returned, that it was no part of the arrangement that without receiving that number the overall project would be abandoned. Mrs Garside says that the claimant always observed the clients' wishes and when she was informed that her updated quotation had been accepted at the meeting on 9th December she took it to be the case that a decision to progress with the processing had been taken on the terms agreed. I find a ring of truth in Mrs Garside's evidence at page 24 of the court bundle (paragraphs 28 and 29) concerning the reprinting of the questionnaires. The reprint is referred to also in the evidence of Mrs Davies. I also accept that a total of 299 completed questionnaires had been delivered by late March 2004. That figure accords with the report and has not been challenged.

68. Mrs Garside states (See bundle page 24, paragraph 30) that she was telephoned a number of times chasing the final report. I find that accords with the tenor of the communications passing between Mr Allison, Mrs Davies and the WDA as set out above. Mr Allison wrote to Mrs Davies asking that she left matters to him and Mrs Davies herself wrote to the WDA (See court bundle page 269) stating that they could expect to hear from Mr Allison with the monitoring form and other required documents in due course and that is confirmed by the letter from WDA dated 18th January 2005 (See court bundle page 272). The evidence explains why Mrs Davies was not in communication with the claimant during the summer of 2004 and why the claimant was being chased by Mr Allison. I accept Mrs Garside's evidence that she delayed in starting to prepare the final report until October 2004 and that it then took her until the end of that year to finalise the draft report for submission to Mr Allison for checking. In these circumstances, it is not at all surprising that when informed the report was ready in early 2005, Mrs Davies indicated the number of copies of the report that the defendant would require and collected them without raising any query at the time. Indeed, it is inconceivable that Mrs Davies would not have expected the finished report from the claimant at some time as she had submitted an invoice to the WDA including the cost of the final report to the WDA and received and banked the cheque in respect of the grant paid on that invoice. It was nonsense for Mrs Davies to suggest to Councillor Wales that she presumed the project had ceased (See page 289) in March 2005. If such had been the case it would have been quite improper for Mr Davies not to have made arrangements to draw the situation to the attention of the council in order to arrange to return funds to the WDA.

69. At this point I return to the evidence concerning the nature of the overall project and the distinction made in relation to the appraisal being a Community project as opposed to being a Community Council project. The distinction was sufficiently important in the eyes of Mr Allison for him to request Mrs Davies to emphasis the distinction to WDA. As I commented earlier the reason for this is not entirely clear. However, it is a distinction Mrs Davies accepted and she wrote to the WDA to underline it. The requirement for the Public Meeting is further evidence of the distinction being material otherwise if the overall project was a Council project such a meeting would have not been necessary. Furthermore, the involvement of the community at large in the design of the questionnaire is evidence of the project not being a Council project. It will also be remembered that Mrs Davies submitted the application form for the WDA grant in her own name and not that of the defendant Council. On the evidence I am satisfied that the overall project falls to be considered not a other Council business would need to be considered but in a somewhat unique category in which the Council members were taking the lead, in partnership with the community at large and Mr Allison of the Re-generation Unit, in undertaking the overall project. It was an ad hoc alliance or partnership in the broadest sense that would potentially benefit every interest in the community and not only those interests usually devolved upon the Community Council. Clearly, such an alliance would require a driving force. In this instance that force was shared between the Council members and Mr Allison. As a result, I am of the view that the overall project fell outside what might properly be termed Council business and would not require to be dealt with as such at its meetings; It explains the unusual manner in which matters progressed and, in particular, the interaction between Mrs Davies and Mr Allison. I suspect that if it were not the case, but rather standard council business, then it would not have been eligible for a WDA grant. For these reasons I do not attach criticism to the unusually lax way in which the Council considered and progressed the overall project in their formal meetings. In my judgment it was unnecessary to follow the strict formality that would normally be expected to attach to Council business and for that reason I find that compliance, during their deliberations in relation to the overall project, with the Standing Orders of the Council and the dictates of Local Government legislation would not be necessary.

70. In the light of the above, I find that the Council acted merely as a conduit for the community at large in assisting it to organise the overall project. The Council members, acting as representatives of the community rather than in their formal elected capacity, steered the overall project to completion with the assistance of their Clerk and Mr Allison. When the Council members accepted the updated quotation submitted by the claimant at its meeting on 9th December 2003, it was representing, in my judgment, by conduct to the claimant that it was accepting the quotation on behalf of the Manorbier community and likewise when Mrs Davies submitted a Council invoice to the WDA. Both the claimant and the WDA acted on the faith of such representations the one in undertaking its part in the contract and the other in releasing the grant money to the defendant on the basis that the monies would be used to discharge the cost incurred with the claimant for undertaking its part in the project. Therein lays a genuine apparent authority based on estoppel.

71. When the claimant presented its invoice to the defendant it relied upon the apparent authority held by the defendant to pay the invoice out of the grant monies held by it that had been allocated, via Mrs Davies, to the Manorbier Community at large by WDA. The claimant had fulfilled its part in the contract and is entitled to expect payment out of the monies held. Following the failure to pay, it seems to me that the defendant is also liable to pay interest on the monies due to the claimant pursuant to section 69 of the County Courts Act 1984. It has held the grant money in its own general account and thereby derived the benefit of the fund since payment of the grant was made to it in April 2005. It has held the money purely as an intermediary or agent for the Community and should have settled the claimants' invoice on delivery.

72. In summary, I find that the claimant is entitled against the defendant to the entry of judgment in respect of the sum claimed on the claim form of £4,578.98 from 8th February 2005 to the date of delivery of this judgment on 9th January 2007. I calculate that to be 700 days at £1.004 per day amounting to £702.53. The claimant is also entitled to the court fee on the claim form of £120 and any allocation fee paid to the court when the case was allocated to track.

73. I shall hear any other application arising out of this judgment at the hearing fixed to formally delivery it on 9th January 2007. I shall send this draft judgment to the parties in advance of that hearing to give the parties opportunity to read and consider it beforehand. I should be grateful if the parties would draw my attention to any typographical or other obvious errors in the draft before it is formally delivered at the hearing.

District Judge Godwin.
To be formally delivered 9th January 2007.