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Election Petition Judgement : Tower Hamlets 2014
[2015] EWHC 1215 (QB)

History
The formation of THF


  1. In the summer of 2013 it appeared that Mr Rahman and the Councillors who supported him were not going to be invited to re-join (or, in some cases, to join) the Labour Party in the immediate future. It was therefore decided that the unofficial party of Mr Rahman and his team ought to be constituted as a formal political party in order to contest the 2014 Mayoral and Council elections. Although the name chosen was Tower Hamlets First the constituent documents of the party made it clear that it was the party of Lutfur Rahman and that its primary objective was to secure his re-election as Mayor.
  2. The requirements for registration of a political party are laid down in the Political Parties, Elections Referendums Act 2000 ('PPERA'). Section 22 provides that no person may stand as a candidate on behalf of a party unless that party is registered with the Electoral Commission. The relevant parts of s.24 read
    1. For each registered party there shall be-
      1. a person registered as the party's leader;
      2. a person registered as the party's nominating officer;
      3. and a person registered as the party's treasurer;

      but the person registered as leader may also be registered as nominating officer or treasurer (or both).

    2. The person registered as a party's leader must be-
      1. the overall leader of the party; or
      2. where there is no overall leader of the party, a person who is the leader of the party for some particular purpose.
    3. The person registered as a party's nominating officer must have responsibility for the arrangements for-
      1. the submission by representatives of the party of lists of candidates for the purpose of elections;
      2. the issuing of such certificates as are mentioned in section 22(6); and
      3. the approval of descriptions and emblems used on nomination and ballot papers at elections.
    4. The person registered as a party's treasurer shall be responsible for compliance on the part of the party-
      1. with the provisions of Parts 3, 4 and 4A (accounting requirements and control of donations, loans and certain other transactions)
      2. unless a person is registered as the party's campaigns officer in accordance with section 25, with the provisions of Parts V to VII (campaign expenditure, third party expenditure and referendums) as well.
  3. Section 26 of PPERA states:
    1. A party may not be registered unless it has adopted a scheme which-
      1. sets out the arrangements for regulating the financial affairs of the party for the purposes of this Act; and
      2. has been approved in writing by the Commission.
    2. The scheme must in particular determine for the purposes of this Act whether the party is to be taken to consist of-
      1. a single organisation with no division of responsibility for the financial affairs and transactions of the party for the purposes of Part III (accounting requirements), or
      2. a central organisation and one or more separate accounting units, that is to say constituent or affiliated organisations each of which is to be responsible for its own financial affairs and transactions for the purposes of that Part.
    3. In the latter case the scheme must-
      1. identify, by reference to organisations mentioned in the party's constitution, those which are to constitute the central organisation and the accounting units respectively; and
      2. give the name of each of those organisations.
    4. The scheme must in every case include such other information as may be prescribed by regulations made by the Commission.
    5. Where a draft scheme is submitted by a party for the Commission's approval, the Commission may either—
      1. approve the scheme, or
      2. give the party a notice requesting it to submit a revised scheme to them, as they think fit.
  4. Under s.28, in order to be registered, a party must send to the Commission an application complying with Schedule 4 to the Act and accompanied by a declaration under s.28(2) that it intends to contest one or more elections. Under s.28A the party may include a request for the registration of up to 12 descriptions to be used on nomination papers or ballot papers (though the Commission has the power to disallow inappropriate or misleading descriptions) and s.29 permits a request for up to three emblems to be used on ballot papers, Section 41 provides
    1. The treasurer of a registered party must ensure that accounting records are kept with respect to the party which are sufficient to show and explain the party's transactions.
    2. The accounting records must be such as to-
      1. disclose at any time, with reasonable accuracy, the financial position of the party at that time; and
      2. enable the treasurer to ensure that any statement of accounts prepared by him under section 42 complies with the requirements of regulations under subsection (2)(a) of that section.
    3. The accounting records must in particular contain-
      1. entries showing from day to day all sums of money received and expended by the party, and the matters in respect of which the receipt and expenditure take place; and
      2. a record of the assets and liabilities of the party.
  5. Schedule 4 sets out the requirements for an application. It must state the party's registered name and the address of its headquarters. It must give the name and home address of the leader, the nominating officer and the treasurer and (if there is one) the campaigns officer. Importantly, the application must be accompanied by a copy of the party's constitution and a draft of the financial scheme proposed to be adopted under s.26. The leader, the nominating officer, the treasurer and (if applicable) the campaigns officer must all sign the application and, if anyone has two capacities it must be made clear that he is signing in both capacities.
  6. Given that THF had indubitably been registered as a political party by the Electoral Commission on 18 September 2013, during cross-examination questions were directed to Mr Rahman about this. After all, if Sch 4 had been complied with, he must at least have seen and signed the relevant documentation.
  7. Accordingly the court asked him about the party's constitution and received this reply:
  8. Election Commissioner:

    As I understand it, an application for registration must be accompanied by a copy of the party's constitution?

    Mr Rahman:

    Sure

    Election Commissioner:

    So, there is a constitution?

    Mr Rahman:

    I do not believe there is a constitution, so I do not know how they got over that. (Laughter)

    Barrister Hore:

    There is no constitution?

    Mr Rahman:

    There may be aims and objectives set out, I do not believe there is a constitution.

  9. Mr Rahman was equally numb and vague about the existence of a financial scheme under s.26.
  10. When it was explained to him that there must have been some kind of constitution and financial scheme for the Commission to have permitted registration, Mr Rahman replied blandly that he had left everything to Mr Alibor Choudhury.
  11. Eventually the constitution and financial scheme were unearthed and Mr Choudhury gave evidence about them.
  12. What may be said with certainty is that whatever the documentation necessary to be produced to satisfy the Electoral Commission to permit registration, that documentation formed no part of the running of the party. At all times the party had two officers and two officers only: Mr Rahman, the leader, and Mr Choudhury, the treasurer. When asked who the nominating officer was, Mr Rahman said it was Mr Choudhury. Reference to s.24 of PPERA above will show that it is permissible for the leader to be nominating officer or treasurer (or both) but it does not permit the treasurer to be nominating officer. Thus the party should have had a separate nominating officer if Mr Rahman was not prepared to undertake the task, and it is a sign of the complete disregard for PPERA manifested by Mr Rahman and Mr Choudhury that these formalities were not even paid lip service.
  13. The financial arrangements were even more bizarre. It can be said that because the Commission rubber-stamped the application for registration it may be inferred that the Commission was satisfied. All one may say, with the greatest of respect for the Commission, that the enquiries into the structures of THF cannot have been excessively rigorous.
  14. The reality is that there was no responsible financial scheme whatsoever. Mr Rahman and Mr Choudhury admitted quite freely in evidence that the party had never had (or even proposed to have) a bank account. The court was told an elaborate rigmarole of how party donations were logged in some kind of Excel spreadsheet and they were called off in kind rather than in cash by asking 'donors' to pay the party's bills. Although donations and expenditure are statutorily required to be made through the treasurer, this rule was conveniently ignored.
  15. Despite frequent requests made by Mr Hoar and the polite raising of judicial eyebrows at the apparent lack of documentation, neither Mr Rahman nor Mr Choudhury produced any books of account or even the much-mentioned Excel spreadsheet.
  16. In short, the financial affairs of THF were, at best, wholly irresponsible and at worst, dishonest. While documents were produced apparently showing that 'donors' had paid some expenses of the party, those payments had obviously not passed through the treasurer or been recorded in any books of account. True returns of expenses were made to the Electoral Commission (incomplete as it turned out in the case of the party's most generous donor) but beyond a few invoices addressed to people who were not officials of THF, which they seem to have paid, the finances of THF were shrouded in mystery.
  17. Again, the excuse given for the chaotic nature of the party's structure and finances was that re-admission to the Labour Party was just around the corner so it wasn't worth bothering for a couple of months or so. Although the court accepts that Mr Rahman would like to be re-admitted to the Labour Party, it does not accept that, in the summer of 2013 -- or indeed at any time thereafter until the election in May 2014 -- Mr Rahman or Mr Choudhury had entertained any serious belief that the invitation would arrive. As will be seen, they embarked on a political campaign, largely targeting the Labour Party, their principal rivals, which their own counsel described as 'dirty'. No rational person, viewing the campaign waged by THF against Labour in 2013-4, would have regarded it as a campaign designed to achieve a reconciliation with the Labour Party.


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