The situation in the present case raises again the question of whether it is appropriate to stay an application for judicial review when the defendant public authority has agreed to reconsider the decision in point, from scratch, with a fresh and open mind.
The answer is that it is not appropriate to do so. Staying an application would have the effect of bringing the later decision within the scope of the judicial review. This would be unacceptable primarily because the decision-maker would have the Administrative Court’s shadow hanging over them when they make the decision. This is inconsistent with the function of the Administrative Court, which is to review discrete decisions by means of individual applications. A fresh decision would need a fresh application for judicial review.
You can read the full reasons of the Mr Justice Holman for his decision here:
35. The first and most important reason is that it is quite wrong in principle that a public authority should be reconsidering a decision afresh with the court metaphorically looking over the shoulder of the public authority or the decision maker. Judicial review does not exist to regulate or micro-manage decision making by public authorities. It exists, rather, to consider the lawfulness or rationality of such decisions once they have been made.
36. In this regard, I repeat and echo some words of Munby J at paragraph 33 of his judgment in R (on the application of P) v Essex County Council  EWHC 2027 (Admin), which are repeated and reproduced at paragraph 21 of the judgment of HHJ Pelling QC in Bhatti, R (on the application of) v Bury MBC  EWHC 3093 (Admin) which is the authority in this field to which Cranston J referred in his written decision of 4 March 2016.
37. Munby J said that it is not part of the function of the Administrative Court to: “[…] monitor, regulate or police the performance by the County Council of its statutory functions on a continuing basis […] The function of the Administrative Court is […] to review the lawfulness of a decision, action or failure to act in relation to the exercise of a public function. In other words, the Administrative Court exists to adjudicate upon specific challenges to discrete decisions […].”
38. If proceedings of this kind are merely “stayed” whilst the decision maker reconsiders a decision, then the important principle enunciated by Munby J in that passage becomes offended, and the important distinction between the decision making roles of public authorities on the one hand, and the court on the other hand, becomes blurred.
39.The second reason and objection is that the practice of “staying” claims in these circumstances, to be revived if the later decision on reconsideration is unfavourable to the claimant, has the effect (even if this is not a primary intention) of avoiding payment of a fresh court fee. If there is a reconsideration and a fresh decision and a renewed challenge to that decision, then the appropriate specified fee for commencing a claim for judicial review ought to be paid.
40. The third reason is that this practice of “staying” proceedings, sometimes for periods measured by years rather than months, hampers the efficient administration of the working of the Administrative Court. This is, of course, the least of the objections and reasons; but nevertheless the orderly administration of this court requires officials of the court to be able clearly to identify that a case has come to an end, to draw a line under it, and to file away the papers. A significant number of stayed cases merely clutters that process.