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The seventh chapter of Deuteronomy records the following instructions given by Moses to the people of Israel, after delivering the Ten Commandments at Mount Sinai: 1. When the Lord thy God shall bring thee into the land whither thou goest to possess it, and hath cast out many nations before thee, the Hittites, and the Girgashites, and the Amorites, and the Canaanites, and the Perizzites, and the Hivites, and the Jebusites, seven nations greater and mightier than thou; 2 And when the Lord thy God shall deliver them before thee; thou shalt smite them, and utterly destroy them; thou shalt make no covenant with them, nor show mercy unto them: 3. Neither shalt thou make marriages with them; thy daughter thou shalt not give unto his son, nor his daughter shalt thou take unto thy son. 4. For they will turn away thy son from following me, that they may serve other gods: so will the anger of the Lord be kindled against you, and destroy thee suddenly. The third and fourth verses appear to be a clear commandment against intermarriage lest, at least in the case of a Jewish man, the foreign bride persuade her husband to worship false gods. It is a fundamental tenet of Judaism, or the Jewish religion, that the covenant at Sinai was made with all the Jewish people, both those then alive and future generations. It is also a fundamental tenet of the Jewish religion, derived from the third and fourth verses that I have quoted, that the child of a Jewish mother is automatically and inalienably Jewish. I shall describe this as the matrilineal test. It is the primary test applied by those who practise or believe in the Jewish religion for deciding whether someone is Jewish. They have always recognised, however, an alternative way in which someone can become Jewish, which is by conversion. Statistics adduced in evidence from the Institute for Jewish Policy Research (the Institute) show that in the first half of the 20th century over 97% of the Jews who worshipped in this country did so in Orthodox synagogues. Since then there has been a diversification into other denominations, and a minority of Jews now worship in Masorti, Reform and Progressive synagogues. The Institute records a significant decline in the estimated Jewish population in the United Kingdom, which now numbers under 300,000, of which about 70% are formally linked to a synagogue and 30% unaffiliated. Those who convert to Orthodox Judaism in this country number only 30 or 40 a year. The requirements for conversion of the recently formed denominations are less exacting than those of Orthodox Jews. Lord Jonathan Sacks, Chief Rabbi of the United Hebrew Congregation of the Commonwealth and leader of the Orthodox Jews in this country, issued a paper about conversion, through his office (the OCR) on 8 July 2005. In it he stated that conversion was irreducibly religious. He commented: Converting to Judaism is a serious undertaking, because Judaism is not a mere creed. It involves a distinctive, detailed way of life. When people ask me why conversion to Judaism takes so long, I ask them to consider other cases of changed identity. How long does it take for a Briton to become an Italian, not just legally but linguistically, culturally, behaviourally? It takes time. A Jew by conversion is a Jew for all purposes. Thus descent by the maternal line from a woman who has become a Jew by conversion will satisfy the matrilineal test. JFS is an outstanding school. For many years far more children have wished to go there than there have been places in the school. In these circumstances it has been the policy of the school to give preference to those whose status as Jews is recognised by the OCR. That is to children whose mothers satisfy the matrilineal test or who are Jews by conversion by Orthodox standards. The issue raised by this appeal is whether this policy has resulted in an infringement of section 1 of the Race Relations Act 1976 (the 1976 Act). These proceedings were brought on the application of E in relation to M, his 13 year old son. E wished to send M to JFS and M wished to go there. He was refused admission because he was not recognised as a Jew by the OCR. His father is recognised as such but the OCR does not regard that as relevant. What matters is whether his mother was a Jew at the time of his birth. She is Italian by birth. As she was not born of a Jewish mother she could only have been recognised by the OCR as a Jew and as capable of conferring Jewish status on M if she had converted to Judaism before M was born. She had undergone a course of conversion to Judaism before Ms birth under the auspices of a non Orthodox Synagogue, not in accordance with the requirements of Orthodox Jews. The result is that, while her conversion is recognised by Masorti, Reform and Progressive Jews, it is not recognised by the OCR. E and his wife are divorced. They practise the Jewish faith and worship at a Masorti synagogue. E failed in these judicial review proceedings in which he challenged the admissions policy of JFS before Munby J, but succeeded on an appeal to the Court of Appeal. The question of Ms admission has already been resolved between the parties, but the Governing Body of JFS is concerned at the finding of the Court of Appeal that the schools admissions policy infringes the 1976 Act, as are the United Synagogue and the Secretary of State for Children, Schools and Families. Indeed this case must be of concern to all Jewish faith schools which have admissions policies that give preference to Jews. While the court has appreciated the high standard of the advocacy addressed to it, it has not welcomed being required to resolve this dispute. The dissatisfaction of E and M has not been with the policy of JFS in giving preference in admission to Jews, but with the application of Orthodox standards of conversion which has led to the OCR declining to recognise M as a Jew. Yet this appeal necessarily raises the broader issue of whether, by giving preference to those with Jewish status, JFS is, and for many years has been, in breach of section 1 of the 1976 Act. The implications of that question extend to other Jewish faith schools and the resolution of the bone of contention between the parties risks upsetting a policy of admission to Jewish schools that, over many years, has not been considered to be open to objection. This demonstrates that there may well be a defect in our law of discrimination. In contrast to the law in many countries, where English law forbids direct discrimination it provides no defence of justification. It is not easy to envisage justification for discriminating against a minority racial group. Such discrimination is almost inevitably the result of irrational prejudice or ill will. But it is possible to envisage circumstances where giving preference to a minority racial group will be justified. Giving preference to cater for the special needs of a minority will not normally involve any prejudice or ill will towards the majority. Yet a policy which directly favours one racial group will be held to constitute racial discrimination against all who are not members of that group see, for instance, Orphanos v Queen Mary College [1985] AC 761 at p. 771. Nothing that I say in this judgment should be read as giving rise to criticism on moral grounds of the admissions policy of JFS in particular or the policies of Jewish faith schools in general, let alone as suggesting that these policies are racist as that word is generally understood. Direct discrimination I propose in the first instance to consider whether the admissions policy of the JFS has led it to discriminate directly against M on racial grounds. The relevant provisions of the 1976 Act are as follows. Racial discrimination (1) A person discriminates against another in any circumstances relevant for the purposes of any provision of this Act if (a) On racial grounds he treats the other less favourably than he treats or would treat other persons 3. Meaning of racial grounds (1) In this Act, unless the context otherwise requires racial grounds means any of the following grounds, namely colour, race, nationality or ethnic or national origins; racial group means a group of persons defined by reference to colour, race, nationality, or ethnic or national origins; (2) The fact that a racial group comprises two or more distinct racial groups does not prevent it from constituting a particular racial group for the purposes of this Act. Section 17 deals with educational establishments and provides that it is unlawful for the governors of a maintained school, such as JFS, to discriminate against a person in the terms on which it offers to admit him to the establishment as a pupil. It is common ground that JFS discriminated against M in relation to its terms of admission to the school. The issue of whether this amounted to unlawful direct discrimination on racial grounds depends on the answer to two questions: (1) What are the grounds upon which M was refused entry? (2) Are those grounds racial? Grounds In the phrase grounds for discrimination, the word grounds is ambiguous. It can mean the motive for taking the decision or the factual criteria applied by the discriminator in reaching his decision. In the context of the 1976 Act grounds has the latter meaning. In deciding what were the grounds for discrimination it is necessary to address simply the question of the factual criteria that determined the decision made by the discriminator. This approach has been well established by high authority. In R v Birmingham City Council, Ex p Equal Opportunities Commission [1989] AC 1155 the entry criteria applied by the Council for admission to selective single sex grammar schools was in issue. More places were available in boys schools than in girls schools. The result was that girls had to obtain higher marks in the entry examination than boys. The motive for the disparity was, no doubt, that this was necessary to ensure that entry to the schools was determined on merit. The House of Lords held, none the less, that the disparity constituted unlawful discrimination contrary to the Sex Discrimination Act 1975 which prohibited discrimination against a woman on the ground of her sex. Lord Goff of Chieveley, with whom the other members of the Committee agreed, said at p. 1194: There is discrimination under the statute if there is less favourable treatment on the ground of sex, in other words if the relevant girl or girls would have received the same treatment as the boys but for their sex. The intention or motive of the defendant to discriminate, though it may be relevant so far as remedies are concerned (see section 66(3) of the Act of 1975), is not a necessary condition of liability; it is perfectly possible to envisage cases where the defendant had no such motive, and yet did in fact discriminate on the ground of sex. Indeed, as Mr. Lester pointed out in the course of his argument, if the councils submission were correct it would be a good defence for an employer to show that he discriminated against women not because he intended to do so but (for example) because of customer preference, or to save money, or even to avoid controversy. In the present case, whatever may have been the intention or motive of the council, nevertheless it is because of their sex that the girls in question receive less favourable treatment than the boys, and so are the subject of discrimination under the Act of 1975. The difference between the motive for discrimination and the factual criteria applied by the discriminator as the test for discrimination lay at the heart of the division between the majority and the minority of the House of Lords in James v Eastleigh Borough Council [1990] 2 AC 751, another case where sex discrimination was in issue. The Council discriminated between men and women, aged between 60 and 65, in relation to the terms on which they were admitted to swim in a leisure centre run by the Council. Women in this age band were admitted free whereas men had to pay an entry charge. The motive for this discrimination could perhaps be inferred by the manner in which this rule was expressed, namely that those of pensionable age were to be admitted free of charge; women became of pensionable age when they were 60, men when they were 65. Counsel for the Council explained at p. 758 that the councils reason for giving free access to those of pensionable age was that their resources were likely to have been reduced by retirement. The Court of Appeal had treated this motive as being the relevant ground for discriminating in favour of women and against men rather than the factual criterion for discrimination, which was plainly the sex of the person seeking admission to the centre. Lord Bridge, delivering the first opinion of the majority, held that the reasoning of the Court of Appeal was fallacious and that the Councils policy discriminated on the ground of sex. At p. 764 he said of their judgment: The Court of Appeals attempt to escape from these conclusions lies in construing the phrase on the ground of her sex in section 1(1)(a) as referring subjectively to the alleged discriminators reason for doing the act complained of. As already noted, the judgment had earlier identified the councils reason as to give benefits to those whose resources would be likely to have been reduced by retirement and to aid the needy, whether male or female. But to construe the phrase, on the ground of her sex as referring to the alleged discriminators reason in this sense is directly contrary to a long line of authority confirmed by your Lordships House in Reg. vs Birmingham City Council, Ex parte Equal Opportunities Commission. Having cited the passage from Lord Goffs judgment that I have set out at paragraph 12 above, he commented, at p 765: Lord Goffs test, it will be observed, is not subjective, but objective. Adopting it here the question becomes: Would the plaintiff, a man of 61, have received the same treatment as his wife but for his sex? An affirmative answer is inescapable. This but for test was another way of identifying the factual criterion that was applied by the Council as the basis for their discrimination, but it is not one that I find helpful. It is better simply to ask what were the facts that the discriminator considered to be determinative when making the relevant decision. Lord Ackner, concurring, remarked at pp. 769 770: There might have been many reasons which had persuaded the council to adopt this policy. The Court of Appeal have inferred that the councils reason for giving free swimming to those of pensionable age was to give benefits to those whose resources would be likely to have been reduced by retirement: per Sir Nicolas Browne Wilkinson V. C. [1990] 1 Q.B. 61, 73D. I am quite prepared to make a similar assumption, but the councils motive for this discrimination is nothing to the point: see the decision of this House in Reg. vs Birmingham City Council, Ex parte Equal Opportunities Commission [1989] AC 1155. Lord Griffiths, giving the first of the minority opinion, took a different view. He said at p. 768: The question in this case is did the council refuse to give free swimming to the plaintiff because he was a man, to which I would answer, no, they refused because he was not an old age pensioner and therefore could presumably afford to pay 75p to swim. In a lengthy opinion Lord Lowry concurred with Lord Griffiths. The essence of his reasoning appears in the following passage at pp. 775 776: section 1(1)(a) refers to the activities of the discriminator: the words on the ground of his sex provide the link between the alleged discriminator and his less favourable treatment of another. They introduce a subjective element into the analysis and pose here the question Was the sex of the appellant a consideration in the councils decision? Putting it another way, a ground is a reason, in ordinary speech, for which a person takes a certain course. He knows what he is doing and why he has decided to do it. In the context of section 1(1)(a) the discriminator knows that he is treating the victim less favourably and he also knows the ground on which he is doing so. In no case are the discriminators thought processes immaterial. The contrast between the reasoning of the majority and of the minority in this case is, I believe, clear. I find the reasoning of the majority compelling. Whether there has been discrimination on the ground of sex or race depends upon whether sex or race was the criterion applied as the basis for discrimination. The motive for discriminating according to that criterion is not relevant. The observations of Lord Nicholls in Nagarajan v London Regional Transport [2000] 1 AC 501 and Chief Constable of West Yorkshire Police v Khan [2001] 1 WLR 1947, cited by Lord Hope at paragraphs 193 and 194 of his judgment, throw no doubt on these principles. Those observations address the situation where the factual criteria which influenced the discriminator to act as he did are not plain. In those circumstances it is necessary to explore the mental processes of the discriminator in order to discover what facts led him to discriminate. This can be illustrated by a simple example. A fat black man goes into a shop to make a purchase. The shop keeper says I do not serve people like you. To appraise his conduct it is necessary to know what was the fact that determined his refusal. Was it the fact that the man was fat or the fact that he was black? In the former case the ground of his refusal was not racial; in the latter it was. The reason why the particular fact triggered his reaction is not relevant to the question of the ground upon which he discriminated. In Nagarajan, Lord Nicholls approved the reasoning in both the Birmingham City Council case and the Eastleigh Borough Council case. At p. 511 he identified two separate questions. The first was the question of the factual basis of the discrimination. Was it because of race or was it because of lack of qualification? He then pointed out that there was a second and different question. If the discriminator discriminated on the ground of race, what was his motive for so doing? That question was irrelevant. When, at para 29 in Khan, Lord Nicholls spoke of a subjective test he was speaking of the exercise of determining the facts that operated on the mind of the discriminator, not his motive for discriminating. The subjective test, described by Lord Nicholls, is only necessary as a seminal step where there is doubt as to the factual criteria that have caused the discriminator to discriminate. There is no need for that step in this case, for the factual criteria that governed the refusal to admit M to JFS are clear. The JFS Admissions Policy The admissions policy published by JFS for the 2007/8 academic year began as follows: 1.1 It is JFS (the School) policy to admit up to the standard admissions number children who are recognised as being Jewish by the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (OCR) or who have already enrolled upon or who have undertaken, with the consent of their parents, to follow any course of conversion to Judaism under the approval of the OCR. The passage that I have placed in italics was introduced in the 2007/8 year for the first time. No candidate has yet satisfied that criterion, and for present purposes it can be disregarded. In recent years there have been more applicants for entry to JFS who were recognised as Jewish by the OCR than there were places in the school. The admissions policy, somewhat confusingly, describes this as a situation where the school is oversubscribed. Further criteria are laid down for establishing priority in this situation. Here also there has recently been a significant change. Children in care and children with a sibling in the school were and are given priority; the change comes at the next stage. Up to the 2007/8 year priority was next given to applicants who had attended a Jewish primary school. This has now been changed so that these are pro rated with children who have attended a non Jewish primary school. The former criterion would have been likely to favour Jewish children who were being brought up in the Jewish faith. We were not told the reason for this change, and it has no direct bearing on the issues raised by this appeal. The criteria whose application debarred M from entry to JFS are readily identified. They are the criteria recognised by the OCR as conferring the status of a Jew. The child will be a Jew if at the time of his birth his mother was a Jew. His mother will be a Jew if her mother was a Jew or if she has converted to Judaism in a manner that satisfies the requirements of the Orthodox religion. M does not satisfy those criteria because of his matrilineal descent. His mother was not born of a Jewish mother and had not at the time of his birth complied with the requirements for conversion, as laid down by the OCR. Accordingly M does not satisfy the Orthodox test of Jewish status. Are the grounds racial? In answering this question it is important to distinguish between two different, albeit not wholly independent, considerations. The first is the reason or motive that leads the OCR to impose these criteria. The second is the question of whether or not the criteria are characteristics of race. The reason why the OCR has imposed the criteria is that the OCR believes that these are the criteria of Jewish status under Jewish religious law, established at and recognised from the time of Moses. This is not the end of the enquiry. The critical question is whether these requirements of Jewish law are racial, as defined by section 3 of the 1976 Act. Do the characteristics define those who have them by reference to colour, race, nationality or ethnic or national origins? The JFS case I shall summarise the case advanced by Lord Pannick QC for JFS in my own words. There exists a Jewish ethnic group. Discrimination on the ground of membership of this group is racial discrimination. The criteria of membership of this group are those identified by Lord Fraser of Tullybelton in Mandla v Dowell Lee [1983] 2 AC 548. In that case a declaration was sought that refusing admission to a school of a Sikh wearing a turban was indirect racial discrimination. The critical question was whether Sikhs comprised a racial group for the purposes of the 1976 Act. It was common ground that they were not a group defined by reference to colour, race, nationality or national origins. It was contended, however, that they were a group defined by ethnic origins. In considering the meaning of this phrase, Lord Fraser at pp 561 562 referred to a meaning of ethnic given by the Supplement to the Oxford English Dictionary (1972): pertaining to or having common racial, cultural, religious, or linguistic characteristics, esp. designating a racial or other group within a larger system. His comments in relation to this definition have been set out in full by Lord Mance at paragraph 83 of his judgment and as Lord Mance remarked they merit reading in full. It suffices, however, to cite the passage at p. 562 where Lord Fraser set out the seven characteristics, some of which he held would be shared by, and would be the touchstone of, members of an ethnic group: The conditions which appear to me to be essential are these: (1) a long shared history, of which the group is conscious as distinguishing it from other groups, and the memory of which it keeps alive; (2) a cultural tradition of its own, including family and social customs and manners, often but not necessarily associated with religious observance. In addition two essential characteristics the following characteristics are, in my opinion, relevant; (3) either a common geographical origin, those to or descent from a small number of common ancestors; (4) a common language, not necessarily peculiar to the group; (5) a common literature peculiar to the group; (6) a common religion different from that of neighbouring groups or from the general community surrounding it; (7) being a minority or being an oppressed or a dominant group within a larger community, for example a conquered people (say, the inhabitants of England shortly after the Norman conquest) and their conquerors might both be ethnic groups. A group defined by reference to enough of these characteristics would be capable of including converts, for example, persons who marry into the group, and of excluding apostates. Provided a person who joins the group feels himself or herself to be a member of it, and is accepted by other members, then he is, for the purposes of the Act, a member. The Orthodox test of who is a Jew focuses on matrilineal descent. Discrimination on the basis of descent simpliciter is not necessarily discrimination on racial grounds. To discriminate against someone because he is not the son of a peer, or the son of a member of the SOGAT printing union, is not racial discrimination. Under the Orthodox test the Jewish woman at the head of the maternal line may be a convert of any nationality and from any ethnic background. Furthermore, because the Orthodox test focuses exclusively on the female line, any Jewish national or ethnic blood can become diluted, generation after generation, by the blood of fathers who have no Jewish characteristics of any kind. This is likely to happen if a Jewish woman marries out of and abandons the Jewish faith. It is possible today to identify two different cohorts, one by the Mandla criteria and one by the Orthodox criteria. The cohort identified by the Mandla criteria forms the Jewish ethnic group. They no longer have a common geographical origin or descent from a small number of common ancestors, but they share what Lord Fraser regarded as the essentials, a long shared history, of which the group is conscious as distinguishing it from other groups and the memory of which it keeps alive and a cultural tradition of its own, including family and social customs and manners, often but not necessarily associated with religious observance. The man in the street would recognise a member of this group as a Jew, and discrimination on the ground of membership of the group as racial discrimination. The Mandla group will include many who are in the cohort identified by the Orthodox criteria, for many of them will satisfy the matrilineal test. But there will be some who do not. So far as the cohort identified by the Orthodox test is concerned, many of these will also fall within the Mandla group. But there will be some, indeed many, who do not. Most of these will be descendants from Jewish women who married out of and abandoned the Jewish faith. They will not satisfy the two vital criteria identified by Lord Fraser. Indeed, they may be unaware of the genetic link that renders them Jewish according to the Orthodox test. Thus, in Lord Pannicks submissions the Orthodox test is not one that necessarily identifies members of the Jewish ethnic group. It is a test founded on religious dogma and discrimination on the basis of that test is religious discrimination, not racial discrimination. Discussion Initially I found Lord Pannicks argument persuasive, but on reflection I have concluded that it is fallacious. The fallacy lies in treating current membership of a Mandla ethnic group as the exclusive ground of racial discrimination. It ignores the fact that the definition of racial grounds in section 3 of the 1976 Act includes ethnic or national origins (my emphasis). Origins require one to focus on descent. Lord Pannick is correct to submit that descent simpliciter is not a ground of racial discrimination. It will only be such a ground if the descent in question is one which traces racial or ethnic origin. This leads me to a further argument advanced on behalf of JFS, which found favour with Munby J and is accepted by Lord Hope. This is that the matrilineal test is a religious test and that discrimination on the basis of that test is religious, not racial. This argument falls into two parts: (i) the matrilineal test is a test laid down by Jewish religious law; (ii) the matrilineal test is not a test of ethnic origin or ethnic status but a test of religious origin and religious status. The first part of this argument focuses, as has Lord Hope, on the reason why the matrilineal test is applied. The reason is that the JFS and the OCR apply the test for determining who is a Jew laid down by Orthodox Jewish religious law. What subjectively motivates them is compliance with religious law, not the ethnicity of the candidates who wish to enter the school. My reaction to this argument will already be clear. It is invalid because it focuses on a matter that is irrelevant the motive of the discriminator for applying the discriminatory criteria. A person who discriminates on the ground of race, as defined by the Act, cannot pray in aid the fact that the ground of discrimination is one mandated by his religion. The second argument requires more detailed analysis. It is that the criteria applied by the matrilineal test are religious criteria. They identify the religious status of the woman at the head of the maternal line and the religious status of the child at the end of the line. They have nothing to do with ethnicity. Lord Hope suggests that the validity of this argument can be demonstrated by contrasting the position of a person descended from a woman converted a century ago in an Orthodox synagogue with the position of a person descended from a woman converted a century ago in a non Orthodox synagogue. JFS would recognise the former as having Jewish status, but not the latter but the discrimination would result from the application of religious criteria. This example illustrates the fact that today, although not a century ago, in the very small number of cases where the question of whether someone is Jewish depends upon conversion, there is a possibility that different denominations will, as a result of differences between the criteria that they require for conversion, differentiate between them. If so, identifiable sub groups of Jews may develop, distinguished by religious criteria. This does not, however, help to determine whether the sub groups are sub groups of those who share the Jewish religion or sub groups of those who share Jewish ethnicity, or indeed both. Conversion has, for millennia, been accepted by all Jews as one of the ways in which a person can become a Jew, and the evidence that we have seen does not suggest that different tests of conversion have been applied until recent times. One of the difficulties in this case lies in distinguishing between religious and ethnic status. One of the criteria of ethnicity identified by Lord Fraser is a shared religion. In the case of Jews, this is the dominant criterion. In their case it is almost impossible to distinguish between ethnic status and religious status. The two are virtually co extensive. A woman who converts to Judaism thereby acquires both Jewish religious status and Jewish ethnic status. In the Chief Rabbis paper about conversion that I quoted at the beginning of this judgment he says: What is conversion? People often refer to the case of Ruth the Moabite, whose story is told with such beauty in the book that bears her name. It is from Ruths reply to her mother in law Naomi that the basic principles of conversion are derived. She said: Where you go, I will go. Where you stay, I will stay. Your people will be my people, and your God my God. That last sentence a mere four words in Hebrew defines the dual nature of conversion to this day. The first element is an identification with the Jewish people and its fate (Your people will be my people). The second is the embrace of a religious destiny, the covenant between Israel and God and its commands (Your God will be my God). I also found helpful in this context a passage in the response to a request for information from the Treasury Solicitor by Rabbi Dr Tony Bayfield, the head of the movement for Reform Judaism. It is headed Background Information and I do not believe it to be controversial: I believe that you are correct in your understanding of the OCRs criteria for determining whether a child is Jewish. This definition is, in essence, shared by the entire Jewish world both in Britain and globally. There are nuances the most significant of which is that the Liberal Movement (Liberal Judaism) in Britain regards as Jewish a child either of whose parents is Jewish (Liberal Judaism represents about 8% of synagogue affiliations; the other 92% of affiliations are to groupings which follow the tradition of the maternal line). However, all Jewish institutions worldwide as far as I know would say that Jewish identity is determined by either descent or conversion. There is a verse in the Book of Deuteronomy (Ch 29 v14) which describes the covenant between God and the Jewish people made at Sinai as being made both with those who stood there [at the foot of Sinai on] that day and also with those who were not there that day. Tradition defines those who were not there as descendants and converts. Conversion has been a feature of Jewish life for thousands of years. It has been most prolific when Jews have lived in tolerant, open societies and least prolific when Jews have been persecuted and state law has prohibited conversion to Judaism. But it has always taken place and means that Jews exhibit a range of facial features any visit to Israel will reveal Jews of different skin colours and appearance. Jews are not a race within any accepted or acceptable definition of the word. The phrase ethnic group is sometimes suggested but since ethnic can mean either cultural or racial or a mixture of the two, it is not very helpful. The best definition or description that I know is that Jews are a people bound together by ties of history and culture. Which brings us back to the verse from Deuteronomy. Jews are a people defined by the Sinai myth (not a pejorative term) of descent, of a continuous chain made up of descendants and converts, the latter becoming parts of the chain, indistinguishable from those who are Jewish by descent, inheriting the history, the culture (at core a religious culture) and at once becoming part of it. So, the OCRs definition of Jewish status is, in its essence, universal descent or conversion. This passage demonstrates a number of matters. First that the test of descent is not restricted to Orthodox Jewry but is a universal test applied by those who consider themselves to be Jews. Secondly that, whatever their racial, national and ethnic background, conversion unquestionably brings the convert within the Mandla definition of Jewish ethnicity. She becomes a member of the Jewish people. See also the comparison made by the Chief Rabbi between conversion and changing nationality in my earlier quotation. Thirdly the passage demonstrates that the religious test of matrilineal descent does not apply an idiosyncratic criterion that has no connection to race. It is a test which focuses on the race or ethnicity of the woman from whom the individual is descended. Where a Jew is descended by the maternal line from a woman who has converted to Judaism, the matrilineal link is with an ethnic Jew. There is this further important point. Focusing on conversion ignores the fact that the matrilineal test is not restricted to descent from Jews by conversion. The Jews to whom Moses spoke at Mount Sinai would have shared all seven of the characteristics of ethnic identity itemised by Lord Fraser in Mandla. The passage in Deuteronomy to which Jews look as the basis of the matrilineal test plainly focuses on race. Many Jews are highly conscious of their particular geographical and national roots. We had evidence of Cohens who trace their ancestry back to the servants at the Temple and who, for that reason, are prohibited from marrying a convert. For these reasons it is plain that the relevant characteristics of the relative to whom the maternal line leads are not simply religious. The origin to which the line leads can be racial and is, in any event, ethnic. Thus we are not here dealing with descent from a peer, or from a member of SOGAT, but a woman whose race, possibly, and her ethnicity, certainly, as well as her religion, are Jewish. David Frei, the Registrar of the London Beth Din, states in his witness statement that matrilineal descent is a criterion of Jewish identity, that being Jewish is a matter of religious status under Jewish religious law and that in orthodoxy, Jewish status is solely and irreducibly a religious issue. I take these statements to mean that the test of Jewish status is a test laid down exclusively by religion. It would not be right to read them as meaning that the only thing that matrilineal descent does is to identify religious status, whether of the ancestor at the head of the line or of the descendant at the other. This would not be consistent with the first element of the dual nature of conversion, as described by the Chief Rabbi. Nor would it be consistent with the fact that the matrilineal test embraces racial origin. To the Jew the matrilineal descendant is a member of the Jewish family and a member of the Jewish religion. The two are inextricably intertwined. The descendant will not necessarily be a member of a Mandla Jewish ethnic group; that is the group that has the essential criteria identified by Lord Fraser. He may, indeed, have none of the seven criteria in the list. The gentile in the street would not identify such a person as a Jew. Equally, he would not identify such a person as a member of the Jewish religion. Membership of a religion or faith normally indicates some degree of conscious affiliation with the religion or faith on the part of the member. The question of the status of the matrilineal descendant may thus depend upon whether one is applying the subjective viewpoint of a Jew or the objective Mandla test. But one thing is clear about the matrilineal test; it is a test of ethnic origin. By definition, discrimination that is based upon that test is discrimination on racial grounds under the Act. Lord Pannick is correct to say that it is possible to identify two different cohorts, or groups, with an overlapping membership, those who are descended by the maternal line from a Jew, and those who are currently members of the Jewish ethnic group. Discrimination against a person on the grounds that he or she is, or is not, a member of either group is racial discrimination. JFS discriminates in its admission requirements on the sole basis of genetic descent by the maternal line from a woman who is Jewish, in the Mandla as well as the religious sense. I can see no escape from the conclusion that this is direct racial discrimination. The consequences of the majority decision. The website of the JFS states that Whilst two thirds or more of our students have attended Jewish primary schools, a significant number of our year 7 intake has not attended Jewish schools and some enter the school with little or no Jewish education. Many come from families who are totally committed to Judaism and Israel; others are unaware of Jewish belief and practice. Initially this gave me the impression that successful candidates for entry to JFS included a significant number who had no connection with Judaism other than a matrilineal link with a Jewish woman, so that they fell outside the Mandla ethnic Jewish group. On reflection I found this an unlikely scenario. Any parents who apply to send their children to JFS relying on matrilineal Jewish descent must, at least, have an awareness of that link with Judaism. Evidence from the JFS suggests rather more than this. The schools information sheet which is sent to prospective teaching staff states: The modern JFS serves almost the whole breadth of the Anglo Jewish community in Greater London. About 85% of its students come from Barnet, Harrow, Brent and Hertsmereour students come from the widest possible range of social, economic and religious backgrounds. Our parents represent a very broad range of society. They all, however, share two things in common; a strong sense of Jewish identity and, in almost all cases, a keen sense of ambition for their children (emphasis added). This suggests that those who decide to send their children to JFS satisfy the Mandla criteria for belonging to an ethnic group, even though some of them do not attend a synagogue. They live in the same part of London, they are conscious of the wifes Jewish descent, and they have a strong sense of Jewish identity. This is likely to include an appreciation of Jewish history and culture. If this is correct, then the reality is that the JFS, in common with other Jewish faith schools, is in practice discriminating in favour of a sub group of Mandla ethnic Jews, who also satisfy the matrilineal requirement. The fact that the JFS conditions of admission would give precedence to candidates who satisfy the descent requirement but do not satisfy the Mandla test of Jewish ethnicity is of no practical significance. This appeal has been concerned with what has, in practice, been only the threshold test for admission to the JFS; matrilineal descent. For at least the last ten years the JFS has been oversubscribed with candidates for admission who satisfy this test. The problem has been how to choose between them. The evidence does not suggest that anyone has challenged the matrilineal test in principle. It is, after all, a test that has general acceptance as the criterion of being a Jew. Apart from Ms challenge, evidence has been given of two others, but each of these was a challenge on the ground of a failure to recognise the mothers conversion, not a challenge against the admission criteria themselves. Concern has been expressed that the majority decision will compel Jewish faith schools to admit children whom the Jewish religion does not recognise as being Jewish, that is children who are not descended from Jews by the maternal line. It is not clear that this is so. As a result of the decision of the Court of Appeal the JFS has published a new admission policy for admission in September 2010. This applies a test of religious practice, including synagogue attendance, Jewish education and/or family communal activity. As matrilineal descent or conversion is the requirement for membership of the Jewish faith according to the law of that faith, those who satisfy a practice test are likely to satisfy this requirement. Thus, instead of applying the matrilineal descent test by way of direct discrimination, the school will be applying a test that will indirectly discriminate in favour of those who satisfy the matrilineal descent test. It is not clear that the school will now be faced with applications from those who do not satisfy the test. Indirect discrimination Having decided that there has been in this case direct racial discrimination, it would be possible to go on to consider the hypothetical question of whether, if JFSs admissions policy had constituted indirect discrimination, it would have been justifiable. I do not propose to embark on that exercise, which would involve, among other considerations, an analysis of the policy underlying the exception made for faith schools in relation to religious discrimination by section 50 of the Equality Act 2006. I have not found it necessary to consider the provisions of that Act, for they have no bearing on the issue of direct racial discrimination. For the reasons that I have given I would dismiss the substantive appeal. The United Synagogue has appealed against the order for Costs made by the Court of Appeal. I concur in the basis upon which Lord Hope has held that this appeal should be allowed. Submissions in writing as to the appropriate order in respect of the costs of both appeals to the Supreme Court should be submitted within 14 days. LADY HALE No one in this case is accusing JFS (as the Jews Free School is now named) or the Office of the Chief Rabbi of discrimination on grounds of race as such. Any suggestion or implication that they are racist in the popular sense of that term can be dismissed. However, the Race Relations Act 1976 caters also for discrimination on grounds of colour, nationality or ethnic or national origins: see s 3(1). This case is concerned with discrimination on account of ethnic origins. And the main issue is what that means specifically, do the criteria used by JFS to select pupils for the school treat people differently because of their ethnic origins? My answer to that question is the same as that given by Lord Phillips, Lord Mance, Lord Kerr and Lord Clarke and for the same reasons. That we have each written separate opinions underlines the fact that we have each reached the same conclusion through a process of independent research and reasoning. It is only because the debate before us and between us has called in question some fundamental principles of discrimination law that I feel it necessary to underline them yet again. First, the Race Relations Act 1976 creates two different statutory torts, direct and indirect discrimination. It also creates two different forms of indirect discrimination, the original form provided for in section 1(1)(b) and the later form derived from the European Directive (2000/43 EC), provided for in section 1(1A). The later form applies to the discrimination prohibited by section 17, in admission to educational establishments, which is the context here: see s 1(1B)(b). If the later form applies, the original form does not: see s 1(1C). The basic difference between direct and indirect discrimination is plain: see Mummery LJ in R (Elias) v Secretary of State for Defence [2006] EWCA 1293, [2006] 1 WLR 3213, para 119. The rule against direct discrimination aims to achieve formal equality of treatment: there must be no less favourable treatment between otherwise similarly situated people on grounds of colour, race, nationality or ethnic or national origins. Indirect discrimination looks beyond formal equality towards a more substantive equality of results: criteria which appear neutral on their face may have a disproportionately adverse impact upon people of a particular colour, race, nationality or ethnic or national origins. Direct and indirect discrimination are mutually exclusive. You cannot have both at once. As Mummery LJ explained in Elias, at para 117, The conditions of liability, the available defences to liability and the available defences to remedies differ. The main difference between them is that direct discrimination cannot be justified. Indirect discrimination can be justified if it is a proportionate means of achieving a legitimate aim. But it is significant that section 57(3) provides that, in respect of the earlier form of indirect discrimination under section 1(1)(b), no award of damages shall be made if the respondent proves that the requirement or condition in question was not applied with the intention of treating the claimant unfavourably on racial grounds. We are concerned with the later form of indirect discrimination, under section 1(1A), to which section 57(3) does not apply, but the fact that this exception to the available remedies was made suggests that Parliament did not consider that an intention to discriminate on racial grounds was a necessary component of either direct or indirect discrimination. One can act in a discriminatory manner without meaning to do so or realising that one is. Long standing authority at the highest level confirms this important principle. The leading case on direct discrimination is R v Birmingham City Council, ex p Equal Opportunities Commission [1989] 1 AC 1155. So far as I am aware, it has never previously been suggested that it set the law on the wrong track: quite the reverse. As is well known, there were more grammar school places for boys than for girls in Birmingham with the result that girls had to do better than boys in the entrance examination in order to secure a place. The council did not mean to discriminate. It bore the girls no ill will. It had simply failed to correct a historical imbalance in the places available. It was nevertheless guilty of direct discrimination on grounds of sex. Lord Goff of Chieveley said this, at p 1194A: There is discrimination under the statute if there is less favourable treatment on the ground of sex, in other words if the relevant girl or girls would have received the same treatment as the boys but for their sex. The intention or motive of the defendant to discriminate, although it may be relevant so far as remedies are concerned . is not a necessary condition of liability; it is perfectly possible to envisage cases where the defendant had no such motive, and yet did in fact discriminate on the ground of sex. Indeed, . if the councils submission were correct it would be a good defence for an employer to show that he discriminated against women not because he intended to do so but (for example) because of customer preference, or to save money, or even to avoid controversy. In the present case, whatever may have been the intention or motive of the council, nevertheless it is because of their sex that the girls in question receive less favourable treatment than the boys, and so are the subject of discrimination under the Act of 1975. He went on to point out that this was well established in a long line of authority, citing Jenkins v Kingsgate (Clothing Productions) Ltd [1981] 1 WLR 1485, 1494, per Browne Wilkinson J; R v Secretary of State for Education and Science, Ex parte Keating (1985) 84 LGR 469, 475, per Taylor J; and Ministry of Defence v Jeremiah [1980] QB 87, 98, per Lord Denning MR. The but for test was endorsed again by the House in the rather more controversial case of James v Eastleigh Borough Council [1990] 2 AC 751. Again, the facts are well known. A husband and wife, both aged 61, went to their local swimming pool. The husband was charged 75 pence and the wife was let in free. Once again the council had the best of motives. People who had reached pensionable age were let in free. But pensionable age directly discriminated between men and women on grounds of their sex. It followed that the swimming pool admission charges did so too. As Lord Bridge of Harwich said, at pp 765 6, the purity of the discriminators subjective motive, intention or reason for discriminating cannot save the criterion applied from the objective taint of discrimination on the ground of sex. Lord Ackner was to the same effect, at p 769: The policy itself was crystal clear if you were a male you had, vis vis a female, a five year handicap. The reason why this policy was adopted can in no way affect or alter the fact that the council had decided to implement and had implemented a policy by virtue of which men were to be treated less favourably than women, and were to be so treated on the ground of, i.e. because of, their sex. Lord Goff of Chieveley amplified what he had said in Birmingham, at p 774: Whether or not the treatment is less favourable in the relevant sense, i.e. on the ground of sex, may derive either from the application of a gender based criterion to the complainant, or from selection by the defendant of the complainant because of his or her sex; but, in either event, it is not saved from constituting unlawful discrimination by the fact that the defendant acted from a benign motive. However, in the majority of cases, I doubt if it is necessary to focus upon the intention or motive of the defendant in this way. This is because, as I see it, cases of direct discrimination under section 1(1)(a) can be considered by asking the simple question: would the complainant have received the same treatment from the defendant but for his or her sex. Although this decision was clearly on all fours with the Birmingham case, it was reached only by a majority. Lord Lowry preferred a subjective rather than an objective approach to on grounds of sex. Lord Griffiths, interestingly, pointed out that to impose a retirement age of 60 on women and 65 on men was discriminatory on the grounds of sex. It would result in women being less well off than men at 60. But what I do not accept is that an attempt to redress the result of that unfair act of discrimination by offering free facilities to those disadvantaged by the earlier act of discrimination is, itself, necessarily discriminatory on grounds of sex (p 768). Lord Griffiths was there challenging the concept of symmetrical formal equality: that it is just as discriminatory to treat a man less favourably than a woman, even though the object is to redress the impact of previous less favourable treatment of a woman. But there can be no doubt that the original sex and race discrimination legislation intended, through the mechanism of direct discrimination, to achieve symmetrical formal equality between men and women, black and white, rather than to redress any historic disadvantage of one against the other. Attempts to do so, for example by quotas or all women shortlists, are still highly controversial. Despite this difference of opinion, the decisions in Birmingham and James have been applied time and time again. They were affirmed by the House of Lords in the victimisation case of Nagarajan v London Regional Transport [2000] 1 AC 501. As Lord Nicholls of Birkenhead said, at p 511: Racial discrimination is not negatived by the discriminators motive or intention or reason or purpose (the words are interchangeable in this context) in treating another person less favourably on racial grounds. In particular, if the reason why the alleged discriminator rejected the complainants job application was racial, it matters not that his intention may have been benign. However, Lord Nicholls had earlier pointed out that there are in truth two different sorts of why question, one relevant and one irrelevant. The irrelevant one is the discriminators motive, intention, reason or purpose. The relevant one is what caused him to act as he did. In some cases, this is absolutely plain. The facts are not in dispute. The girls in Birmingham were denied grammar school places, when the boys with the same marks got them, simply because they were girls. The husband in James was charged admission to the pool, when his wife was not, simply because he was a man. This is what Lord Goff was referring to as the application of a gender based criterion. But, as Lord Goff pointed out, there are also cases where a choice has been made because of the applicants sex or race. As Lord Nicholls put it in Nagarajan, in every case it is necessary to inquire why the complainant received less favourable treatment. This is the crucial question. Was it on grounds of race? Or was it for some other reason, for instance, because the complainant was not so well qualified for the job? Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator (pp 510 511). In James, Lord Bridge was not to be taken as saying that the discriminators state of mind is irrelevant when answering the crucial, anterior question: why did the complainant receive less favourable treatment? The distinction between the two types of why question is plain enough: one is what caused the treatment in question and one is its motive or purpose. The former is important and the latter is not. But the difference between the two types of anterior enquiry, into what caused the treatment in question, is also plain. It is that which is also explained by Lord Phillips, Lord Kerr and Lord Clarke. There are obvious cases, where there is no dispute at all about why the complainant received the less favourable treatment. The criterion applied was not in doubt. If it was based on a prohibited ground, that is the end of the matter. There are other cases in which the ostensible criterion is something else usually, in job applications, that elusive quality known as merit. But nevertheless the discriminator may consciously or unconsciously be making his selections on the basis of race or sex. He may not realise that he is doing so, but that is what he is in fact doing. As Lord Nicholls went on to say in Nagarajan, An employer may genuinely believe that the reason why he rejected an applicant had nothing to do with the applicants race. After careful and thorough investigation of a claim members of an employment tribunal may decide that the proper inference to be drawn from the evidence is that, whether the employer realised it at the time or not, race was the reason why he acted as he did . Conduct of this nature by an employer, when the inference is legitimately drawn, falls squarely within the language of section 1(1)(a) (p 512). This case is not in that category. There is absolutely no doubt about why the school acted as it did. We do not have to ask whether they were consciously or unconsciously treating some people who saw themselves as Jewish less favourably than others. Everything was totally conscious and totally transparent. M was rejected because he was not considered to be Jewish according to the criteria adopted by the Office of the Chief Rabbi. We do not need to look into the mind of the Chief Rabbi to know why he acted as he did. If the criterion he adopted was, as in Birmingham or James, in reality ethnicity based, it matters not whether he was adopting it because of a sincerely held religious belief. No one doubts that he is honestly and sincerely trying to do what he believes that his religion demands of him. But that is his motive for applying the criterion which he applies and that is irrelevant. The question is whether his criterion is ethnically based. So at long last I arrive at what, in my view, is the only question in this case. Is the criterion adopted by the Chief Rabbi, and thus without question by the school, based upon the childs ethnic origins? In my view, it clearly is. M was rejected because of his mothers ethnic origins, which were Italian and Roman Catholic. The fact that the Office of the Chief Rabbi would have over looked his mothers Italian origins, had she converted to Judaism in a procedure which they would recognise, makes no difference to this fundamental fact. M was rejected, not because of who he is, but because of who his mother is. That in itself is not enough. If M had been rejected because his mother shopped in Waitrose rather than Marks and Spencer, that would not have been because of her or his ethnicity. But it was because his mother was not descended in the matrilineal line from the original Jewish people that he was rejected. This was because of his lack of descent from a particular ethnic group. In this respect, there can be no doubt that his ethnic origins were different from those of the pupils who were admitted. It was not because of his religious beliefs. The school was completely indifferent to these. They admit pupils who practise all denominations of Judaism, or none at all, or even other religions entirely, as long as they are halachically Jewish, descended from the original Jewish people in the matrilineal line. There is no doubt that the Jewish people are an ethnic group within the meaning of the Race Relations Act 1976. No Parliament, passing legislation to protect against racial discrimination in the second half of the twentieth century, could possibly have failed to protect the Jewish people, who had suffered so unspeakably before, during and after the Holocaust. If Parliament had adopted a different model of protection, we would not be here today. Parliament might have adopted a model of substantive equality, allowing distinctions which brought historically disadvantaged groups up to the level of historically advantaged groups. But it did not do so. It adopted a model of formal equality, which allows only carefully defined distinctions and otherwise expects symmetry. A man must be treated as favourably as a woman, an Anglo Saxon as favourably as an African Caribbean, a non Jew as favourably as a Jew. Any differentiation between them, even if it is to redress historic disadvantage, must be authorised by legislation. This means that it is just as unlawful to treat one person more favourably on the ground of his ethnic origin as it is to treat another person less favourably. There can be no doubt that, if an employer were to take exactly the same criterion as that used by the Office of the Chief Rabbi and refuse to employ a person because the Chief Rabbi would regard him as halachically Jewish, the employer would be treating that person less favourably on grounds of his ethnic origin. As Lord Kerr explains, there can be no logical distinction between treating a person less favourably because he does have a particular ethnic origin and treating him less favourably because he does not. Some may feel that discrimination law should modify its rigid adherence to formal symmetry and recognise a greater range of justified departures than it does at present. There may or may not be a good case for allowing Jewish schools to adopt criteria which they believe to be required by religious law even if these are ethnically based. As far as we know, no other faith schools in this country adopt descent based criteria for admission. Other religions allow infants to be admitted as a result of their parents decision. But they do not apply an ethnic criterion to those parents. The Christian Church will admit children regardless of who their parents are. Yet the Jewish law has enabled the Jewish people and the Jewish religion to survive throughout centuries of discrimination and persecution. The world would undoubtedly be a poorer place if they had not. Perhaps they should be allowed to continue to follow that law. But if such allowance is to be made, it should be made by Parliament and not by the courts departing from the long established principles of the anti discrimination legislation. The vehicle exists in the Equality Bill, which completed its committee stage in the House of Commons in the 2008 09 session and will be carried over into the 2009 10 session. The arguments for and against such a departure from the general principles of the legislation could then be thoroughly debated. The precise scope of any exception could also be explored. We know from the helpful intervention of the Board of Deputies of British Jews that the Masorti, Reform and Liberal denominations of Judaism have welcomed the result, if not the reasoning, of the decision of the Court of Appeal and would not wish for the restoration of the previous admission criteria. That is a debate which should not be resolved in court but by Parliament. We must not allow our reluctance to enter into that debate, or to be seen to be imposing our will upon a well meaning religious body, to distort the well settled principles of our discrimination law. That is to allow the result to dictate the reasoning. This was, in my view, a clear case of direct discrimination on grounds of ethnic origin. It follows that, however justifiable it might have been, however benign the motives of the people involved, the law admits of no defence. It also follows that it cannot be a case of indirect discrimination. There is indeed some difficulty in fitting this case into the model of indirect discrimination. The discriminator has to apply to the complainant a provision, criterion or practice which he applies or would apply equally to persons not of the same race or ethnic or national origins as [the complainant]. But if the criterion we are talking about is being halachically Jewish, then it is not applied equally between those who are and those who are not. And there is no question of those who are not being at a particular disadvantage when compared with others persons in the sense that more of the others can comply than they can. None of the non halachically Jewish can comply, while all of the halachically Jewish can do so. There is an exact correspondence between compliance and the criterion, just as there was in the Birmingham and James cases. This too suggests, although it does not prove, that the criterion is itself ethnically based. If not, I would agree with Lord Mance on this issue. I have tried only to explain how the long established principles of discrimination law apply in this case. In agreement with the more ample reasoning of Lord Phillips, Lord Mance, Lord Kerr and Lord Clarke on the facts of the case, I would dismiss the appeal of JFS on the main issue. On the United Synagogues costs appeal, I agree with the reasoning and conclusions of Lord Hope. LORD MANCE Introduction Two issues arise: whether the admissions policy adopted by JFS for 2007/08 involved direct discrimination, and, if not, whether it involved indirect discrimination, in each case against M, represented by his respondent father, E. M applied for admission to year 7 at JFS commencing in September 2007. The school was over subscribed and by letter dated 13 April 2007 it refused, because the school has not received evidence of [Ms] Jewish status, to consider M for a place unless and until all those applicants whose Jewish status has been confirmed have been offered places. An appeal to the independent admission appeal panel for JFS failed on 11 June 2007. The schools admissions policy (determined by its governing body pursuant to the School Standards and Framework Act 1998, ss.88 and 88C) treated an applicant in Ms position less favourably than other persons. The policy was to admit children recognised as being Jewish by the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (OCR) or who have already enrolled upon or who have undertaken, with the consent of their parents, to follow any course of conversion to Judaism under the approval of the OCR. In the event of oversubscription, only children satisfying this test were to be considered for admission, in the following order: looked after children, those with one or more siblings attending JFS and then other applicants (the last category on a pro rata basis within each ability band according to the numbers of applicants attending respectively Jewish and non Jewish primary schools). The OCR, applying the Orthodox Jewish test, recognises as Jewish children who can show an Orthodox Jewish mother or ancestress in the matrilineal line. The mother or matrilineal ancestress can be Orthodox Jewish by birth or by conversion prior to the birth of her relevant child. The respondent is unable to show such descent, because his mother was a non Jewish Italian by birth and converted to Judaism before Ms birth not in the Orthodox tradition, but with the assistance of a non Orthodox Rabbi. The respondent and his father, with whom he now lives, practise Masorti Judaism, and M is recognised as Jewish by Reform and Masorti synagogues. (Before the late eighteenth century, the Court was told, these distinctions in Jewish observance did not exist.) The first question is whether the respondents less favourable treatment was on the grounds of his ethnic origins within s.1(1)(a) of the Race Relations Act 1976. JFS supported by the United Synagogue and the Secretary of State for Children, Schools and Families as interveners submit that M was treated as he was not on ethnic, but on purely religious grounds, while E and M, supported by the Equality and Human Rights Commission and the British Humanist Association as interveners submit that, although the schools motivation was and is religious, the treatment derived from a test which was, or was substantially, based on inherently ethnic grounds. JFS is a school designated as having a religious (Jewish) character under the School Standards and Framework Act 1998, s.69(3), and is accordingly exempted by the Equality Act 2006, s.50(1) from the prohibition against discrimination on the grounds of religion or belief which would otherwise apply under ss.45 and 47 of that Act. But this exemption does not affect the pre existing prohibition of discrimination on the grounds of ethnic origin, under the 1976 Act. The difficulty of the present case is that the word Jewish may refer to a people, race or ethnic group and/or to membership of a religion. In the case of JFS, JFS submits that it refers only to the latter. Munby J found that common to all Jewish denominations is a belief that being Jewish is a matter of status, defined in terms of descent or conversion, and not a matter of creed or religious observance (para. 21). However, JFS exists as an Orthodox Jewish institution, and (while Judaism is not a proselytising religion those who are not Jews can still earn salvation) Education about the Jewish faith is considered by Orthodox Jews to be a fundamental religious obligation on all Jews . An understanding and appreciation of the Jewish faith takes many years . This is one of the primary purposes of schools such as JFS, which seek to help those who are Jewish (or who are undergoing conversion) understand, learn about and follow their faith (the words come from a statement of Dayan Gelley dated 26 February 2008 approved by the Chief Rabbi, and were quoted by Munby J in para. 13). JFSs Instrument of Government, with which its governing body, when determining its admissions policy, was obliged to comply under Education Act 2002 s.21(4), records the schools ethos as being to preserve and develop its religious character in accordance with the principles of Orthodox Judaism, under the guidance of the Chief Rabbi of the United Hebrew Congregations . JFS has further explained in answers dated 17 December 2007 (to questions put by Ms solicitors in a letter dated 17 August 2007 written pursuant to the judicial review protocol and s.65(2) of the Race Relations Act) that JFSs admission criteria seek to maintain the schools religious ethos. In his statement dated 8 February 2008, para. 27, the chair of JFSs admissions committee described the admissions policy as pursuing a legitimate aim because it is developing the religious character of JFS in accordance with the principles of Orthodox Judaism. The same aim was reflected in para. 14 of a determination dated 27 November 2007, made by an Adjudicator appointed under the School Standards and Framework Act 1998 to consider Es objection to JFSs admissions policy. The Adjudicator added the further explanation that the legitimate aim being pursued is seeking to ensure that those children who are Jewish (applying Orthodox Jewish principles) are admitted to the school. While many who are eligible for and obtain admission to JFS as Orthodox Jews do not practise and may profess no or a different religious faith, the schools aim is to inculcate the ethos and, so far as possible, encourage the practice and observance of Orthodox Judaism in and by all who attend. In formulating the schools admissions policy, it was also the governing bodys duty under s.84(3) of that Act to act in accordance with the relevant provisions of the code for school admissions prepared under s.84(1) by the Secretary of State. The Secretary of States Schools Admissions Code for 2003 stated that schools like JFS designated as having a religious character might give preference in their admission arrangements to members of a particular faith or denomination , providing this does not conflict with other legislation, such as race relations legislation (para. 3.9), and that, where they do, their admissions arrangements should make clear whether a statement of religious affiliation or commitment would be sufficient, or whether it is to be tested and if so how and what if any references from a religious leader will be required. The Code for 2007 permits priority in case of over subscription to children who are members of, or who practise, their faith or denomination (para. 2.41) and states that It is primarily for the relevant faith provider group or religious authority to decide how membership or practice is to be demonstrated (para 2.43). Quite apart from the fact that they are subject to the application of the Race Relations Act 1976, the references to membership in the Codes do not specifically address descent based membership which may exist in the eyes of the faith provider or religious authority, while not doing so in the eyes of the child or his or her parents. Direct discrimination Direct discrimination can arise in one of two ways: because a decision or action was taken on a ground which was, however worthy or benign the motive, inherently racial within the meaning of s.1(1)(a), or because it was taken or undertaken for a reason which was subjectively racial: R v Birmingham City Council, ex p Equal Opportunities Commission [1989] AC 1155, 1194C D per Lord Goff of Chieveley, James v Eastleigh Borough Council [1990] 2 AC 751, 772B G per Lord Goff, and Nagarajan v London Regional Transport [2000] 1 AC 501, 511A per Lord Nicholls of Birkenhead and 520H 521B per Lord Steyn. In the Birmingham City Council case, girls were required to achieve a higher standard than boys for grammar school entry because of a disparity in the number of grammar school places available for boys and girls. Whatever may have been the intention or motive of the council, nevertheless it [was] because of their sex that the girls in question receive[d] less favourable treatment than the boys, and so [were] the subject of discrimination: per Lord Goff at p.1194C D. It was for the council to find some way of avoiding this, e.g. by balancing the places available. In James the motive for adopting as the test for free entry to the swimming pool to people who had reached state pension age was no doubt benign (it was probably because they were perceived as more likely to be needy). But being of pensionable age is not to be equated with ceasing to work or being in receipt of a pension, and the difference between the ages (65 and 60 respectively) at which men and women became of pensionable age made the test inherently discriminatory on the ground of sex. In Nagarajan at p.511A Lord Nicholls noted that Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator, while Lord Steyn at pp.520H 521B approved the statements in the Birmingham City Council and James cases. The allegation in the present case is that a decision or action was taken on inherently ethnic grounds within s.1(1)(a), although the schools subjective motivation was its purely religious convictions. I appreciate that even the first part of this allegation involves what may be described as a subjective element a question of fact in Lord Nicholls words in Chief Constable of West Yorkshire Police v Khan [2001] UKHL 48, [2001] 1 WLR 1947, para, 29 in so far as it requires an answer to the question: why in fact was M refused a place? But there is here no room for doubt about the answer. He was refused a place by reason of the application of the admissions policy set out in para 74 above. With that answer, the next, relevant question is simply whether that policy, religiously motivated as it was, involved grounds for admission or refusal of admission which were in their nature inherently ethnic. Lord Pannick submits that, taking the test of an ethnic group recognised by the House of Lords in Mandla v Dowell Lee [1983] 2 AC 548, Jews constitute an ethnic group, but a group which embraces, on the one hand, a wide spectrum of Jewish observance (including that practised by the respondent) and excludes, on the other hand, many individuals who would, on Orthodox Jewish principles, be regarded as Jewish (e.g. a lapsed Jew who had converted to Catholicism or an atheist with a matrilineal Orthodox Jewish ancestress). There is thus no complete identity between a Jew in the sense suggested by that test and an Orthodox Jew according to Orthodox Jewish principles. He relies upon this as reinforcing his submission that JFSs admissions policy is based, and based solely, on religious grounds. I do not, however, consider that this submission resolves the issue. First, Mandla was a case of alleged indirect discrimination under s.1(1)(b) of the Act, which addresses differential treatment between persons of different racial groups. The test under s.1(1)(a) is whether a person has treated another person less favourably on racial grounds, defined by s.3 as meaning on any of the following grounds, namely colour, race, nationality or ethnic or national origins. This test is not expressed to be limited by reference to a need to identify a difference in treatment of persons currently members of different ethnic groups. Further, subsequent to the enactment by the European Community of Council Directive 2000/43/EC of 29th June 2000, which addresses both direct and indirect discrimination without using the concept of racial group in either connection, and since the consequent introduction of s.1(1A) of the Race Relations Act 1976 which equally omits any such concept, it seems to me inappropriate to read s.1(1)(a) as importing any such concept. All that is required is discrimination on grounds of a persons ethnic origins. A second, point, based on the international legal background and of possible relevance to the construction of s.1(1)(a), derives from the International Convention on the Elimination of All Forms of Racial Discrimination (CERD), in force since 1969, to which the United Kingdom is party and to which Directive 2000/43/EC recites that it was intended to give effect. Article 1(1) of CERD defines racial discrimination to mean any distinction, exclusion, restriction or preference based on race, colour, descent, or national or ethnic origin which has the purpose or effect of nullifying or impairing the recognition, enjoyment or exercise, on an equal footing, of human rights and fundamental freedoms in the political, economic, social, cultural or any other field of public life. The reference to descent (although not explicitly repeated after the general prohibition on racial discrimination in article 5) is, on its face, very pertinent in the present case. However, it is suggested that, having been introduced on a proposal by India, the word descent is limited to caste, but India itself disputes this, and it has been forcefully suggested that the background to its introduction indicates that it was not concerned with caste at all: Caste based Discrimination in International Human Rights Law, David Keane (Brunel University, Ashgate Publishing Ltd., 2007, chap. 5). Nevertheless, the Committee established to monitor implementation of CERD under article 8 has itself treated descent as including caste in its General Recommendation XXIX A/57/18 (2002) 111, where it recommended, in para 1, that states take steps to identify those descent based communities under their jurisdiction who suffer from discrimination, especially on the basis of caste and analogous systems of inherited status. Whether or not descent embraces caste, the concepts of inherited status and a descent based community both appear wide enough to cover the present situation. That in turn tends to argue for a wide understanding of the concept of discrimination on grounds of ethnic origins, although the point is a marginal one. Thirdly, and in any event, the Mandla test is broad, flexible and judgmental. It was adopted in order to embrace a group such as the Sikhs, of whom it could not be said that they were a different race in any narrow sense. There is some irony in the fact that, prior to the decision of the House in Mandla, there would have been little doubt that a narrow test based on birth or descent would have been regarded as required in order for there to be discrimination on the ground of ethnic origins. That was the gist of the judgments in the early case of Ealing London Borough Council v Race Relations Board [1972] AC 342. Unlike Mandla, the Ealing case was a case of alleged direct discrimination under s.1(1)(a), and in it statements were made to the effect that discrimination on account of race, or ethnic or national origins involved consideration of a persons antecedents (per Viscount Dilhorne at p.359E), that Origin, in its ordinary sense, signifies a source, someone or something from which someone or something has descended (per Lord Simon of Glaisdale at p.363H) and that national origins normally indicated a connection arising because the parents or one of the parents are or is identified by descent with the nation in question, but it may also sometimes arise because the parents have made their home among the people in question (per Lord Cross of Chelsea at p.365E F). The Court of Appeal in Mandla [1983] QB 1 picked up this approach in relation to indirect discrimination. It identified an ethnic group as one with common ancestral origins, however remote (see per Lord Denning MR at p.10A B and p.11B, expressly instancing Jews as an ethnic group, and per Kerr LJ at p.22B E), and on that basis excluded Sikhs on the ground that they constituted essentially a religious and cultural group. The House disagreed and developed the wider test, but there may still, in my view, be discrimination on grounds of ethnic origin in the narrower and more traditional sense, even under s.1(1)(b), let alone under the differently worded s.1(1)(a). The following passage in which Lord Fraser of Tullybelton developed the test in Mandla [1983] 2 AC 548, 561 563 is also worth quoting in full: I turn, therefore, to the third and wider meaning which is given in the Supplement to the Oxford English Dictionary (1972). It is as follows: 'pertaining to or having common racial, cultural, religious, or linguistic characteristics, esp. designating a racial or other group within a larger system . ' Mr Irvine, for the appellants, while not accepting the third (1972) meaning as directly applicable for the present purpose, relied on it to this extent, that it introduces a reference to cultural and other characteristics, and is not limited to racial characteristics. The 1972 meaning is, in my opinion, too loose and vague to be accepted as it stands. It is capable of being read as implying that any one of the adjectives, 'racial, cultural, religious or linguistic', would be enough to constitute an ethnic group. That cannot be the sense in which 'ethnic' is used in the Act of 1976, as that Act is not concerned at all with discrimination on religious grounds. Similarly, it cannot have been used to mean simply any 'racial or other group'. If that were the meaning of 'ethnic', it would add nothing to the word group, and would lead to a result which would be unacceptably wide. But in seeking for the true meaning of 'ethnic' in the statute, we are not tied to the precise definition in any dictionary. The value of the 1972 definition is, in my view, that it shows that ethnic has come to be commonly used in a sense appreciably wider than the strictly racial or biological. That appears to me to be consistent with the ordinary experience of those who read newspapers at the present day. In my opinion, the word 'ethnic' still retains a racial flavour but it is used nowadays in an extended sense to include other characteristics which may be commonly thought of as being associated with common racial origin. For a group to constitute an ethnic group in the sense of the Act of 1976, it must, in my opinion, regard itself, and be regarded by others, as a distinct community by virtue of certain characteristics. Some of these characteristics are essential; others are not essential but one or more of them will commonly be found and will help to distinguish the group from the surrounding community. The conditions which appear to me to be essential are these: (1) a long shared history, of which the group is conscious as distinguishing it from other groups, and the memory of which it keeps alive (2) a cultural tradition of its own, including family and social customs and manners, often but not necessarily associated with religious observance. In addition to those two essential characteristics the following characteristics are, in my opinion, relevant; (3) either a common geographical origin, or descent from a small number of common ancestors (4) a common language, not necessarily peculiar to the group (5) a common literature peculiar to the group (6) a common religion different from that of neighbouring groups or from the general community surrounding it (7) being a minority or being an oppressed or a dominant group within a larger community, for example a conquered people (say, the inhabitants of England shortly after the Norman conquest) and their conquerors might both be ethnic groups. A group defined by reference to enough of these characteristics would be capable of including converts, for example, persons who marry into the group, and of excluding apostates. Provided a person who joins the group feels himself or herself to be a member of it, and is accepted by other members, then he is, for the purposes of the Act, a member. That appears to be consistent with the words at the end of section 3(1) 'references to a person's racial group refer to any racial group into which he falls.' In my opinion, it is possible for a person to fall into a particular racial group either by birth or by adherence, and it makes no difference, so far as the Act of 1976 is concerned, by which route he finds his way into the group. This view does not involve creating any inconsistency between direct discrimination under paragraph (a) and indirect discrimination under paragraph (b). A person may treat another relatively unfavourably 'on racial grounds' because he regards that other as being of a particular race, or belonging to a particular racial group, even if his belief is, from a scientific point of view, completely erroneous. This passage makes clear that Lord Fraser was not excluding the relevance of descent from a small number of common ancestors. It was one among a number of factors which included, he considered essentially, a long shared history distinguishing a group from other factors and a shared cultural tradition, but which could also include a common geographical origin, language and/or religion and a status as a minority group. The whole passage emphasises the flexibility of the test adopted, and it is consistent with this that its application should depend on the context. A fourth, important point appears from the final sentence in the passage quoted from Lord Frasers speech: A person may treat another relatively unfavourably 'on racial grounds' because he regards that other as being of a particular race, or belonging to a particular racial group, even if his belief is, from a scientific point of view, completely erroneous. Lord Fraser probably had in mind a situation such as that where A, who dislikes Sikhs, discriminates against B in the (in fact erroneous) belief that B is a Sikh. Whether the victim actually has the sexual orientation or racial origins on the ground of which he or she is treated less favourably is irrelevant: English v Thomas Sanderson Blinds Ltd. [2008] EWCA Civ 1421; [2009] ICR 543 (where the majority also held it to be irrelevant whether the discriminator believed the victim to have, or whether the victim thought that the discriminator believed the victim to have, the relevant sexual orientation on the ground of which he was harassed). If A, applying his own view of the relative significance of the various factors mentioned by the House in Mandla, identifies a particular group of people as an ethnic group and discriminates against them on that ground that would, in my view (and as Lord Pannick accepted, with the proviso that there would have to be some basis in the Mandla criteria) be embraced by s.1(1)(a) of the Act. Any definition of an ethnic group applying the Mandla criteria is on this basis also flexible, whether the definition is undertaken for religious, charitable or educational purposes or, as happened only too terribly in Nazi Europe, for entirely malign purposes. In the present case, many of Lord Frasers factors could be seen as pointing without more to a conclusion that Orthodox Judaism should be regarded as a separate ethnic group or sub group including the sharing of a long history distinguishing themselves from other groups, a shared cultural tradition, a common religion and a separate status within any wider Jewish community. Others, such as a common geographical origin and a common language, they share with that wider community. Munby Js reasons for rejecting any suggestion that Orthodox Jews could be regarded as a separate ethnic group or sub group were that there was no evidence that they had separate ethnic origins from other, or most other, Jews. That may be said to focus purely on ethnic origins in a way which the Mandla test was intended to discourage. But, assuming that Orthodox Jews are not a separate ethnic group or sub group for the purposes of indirect discrimination (the relevant subsection for that purpose being now s.1(1A), rather than s.1(1)(b)), I consider that the Orthodox Jewish test of descent in the matrilineal line must still be regarded as a test based on ethnic origins, for the purposes of direct discrimination under s.1(1)(a) of the Act. On the evidence, it is at its core a test by which Orthodox Judaism identifies those to be regarded today as the descendants of a particular people, enlarged from time to time by the assimilation of converts, that is the Jewish people whose ancestor was the patriarch Jacob (Israel) and with whom the covenant of Mount Sinai was made through Moses upon the Exodus from Egypt. That the Jewish people was from its outset also defined by its religion does not lead to a different conclusion. A test of membership of a religion that focuses on descent from a particular people is a test based on ethnic origins. Whether matrilineal descent was originally chosen because it was an easy and secure way of identifying ancestry or because some other special significance was attached to womens role is not relevant. Other tests identifying a people by drawing on descent or ancestry can of course exist, for example, a test based on patrilineal origins, or on the origins of both parents. Some other Jewish denominations, the Court was told, have other tests, e.g. looking, or looking also, at the patrilineal line. But all such tests look, in one way or another, at ethnic origins. They merely take different views as to the form of descent or birth link by reference to which a persons origins in a particular (here biblical) people can be defined. I find instructive in this connection and generally the Background Information provided by Rabbi Dr Tony Bayfield which Lord Phillips quotes in paragraph 40. If a school admissions policy identifying Jews by descent is inadmissible, this will be the case in relation to any denomination of Jewish school applying such a policy, however the relevant descent is identified. This case cannot therefore be viewed as a mere disagreement between different Jewish denominations, for example about the criteria for conversion. It turns, more fundamentally, on whether it is permissible for any school to treat one child less favourably than another because the child does not have whatever ancestry is required, in the schools view, to make the child Jewish. Fifthly, there is, not surprisingly in the circumstances, also material tending positively to confirm that there is in the eyes of JFS no distinction between Jewishness in the religious sense and Jewishness on account of ethnic origins. The Agreed Statement of Facts records that M was refused admission for the year 2007 8, on the ground that he was not recognised as being Jewish by the Office of the Chief Rabbi . The same answer (that this child cannot be recognised as Jewish) was given by the OCR in relation to the child of the marriage of a Cohen (member of the Jewish priestly class) and an English woman who had undertaken conversion with an Orthodox Jewish Beth Din in Israel, on the ground that she had intended to marry her future husband at the time of her conversion, contrary to a prohibition on the marriage of Cohens with converts, with the consequence that her conversion could not have been sincere and was accordingly invalid in the eyes of the OCR. By their letter dated 17 August 2007 Ms solicitors asked JFS, with reference to the time when children applied and/or when a decision on admission was taken, how many children were Jewish on account of their race and/or ethnic origins and how many were not. The schools answer given through its solicitors on 17 December 2007 was that Those children confirmed as Halakhically Jewish were treated as Jewish by the school and those not so confirmed were treated as not Jewish. M set out this answer in his further response dated 19 December 2007 to the appellants notice of acknowledgement of service, in support of a plea that the appellants now belatedly, but rightly, accept that Halakhical Jewish status is synonymous with membership of a racial group for the purposes of section 3 of the Act a plea to which there was no response before the matter came to court. Further, according to a statement quoted in the respondents case, which JFS has not challenged or controverted, the Chair of JFSs Governors responded to fears about the opening in future of new Jewish schools (including or consisting of non Orthodox Jewish schools), by saying: If we are going to be able to maintain the three [existing Orthodox Jewish] schools, we are going to need to supply children out of thin air. The only way to fill all of those places would be to open the doors to children who are not Jewish by ethnicity or not at all. The inference is that the school recognises no distinction even today between Jewishness in a religious and in an ethnic sense. The one dictates the other. When Lord Pannick said on behalf of JFS that JFS does not dispute that there are thousands with Jewish ethnic claims in the Mandla sense who fail the test for a religious reason, that may be the effect of the Mandla test, applied objectively; if so, it is a conclusion about English law which no one could sensibly gainsay. But it does not follow that JFS or the Chief Rabbi themselves concur with or take the view of ethnicity which would follow from applying the Mandla test and the passages which I have quoted indicate that they do not (quite apart from the fact that the Mandla test was not directed to the present issue of less favourable treatment on the ground of ethnic origins). Apart from descent a person may become an Orthodox Jew by conversion. Conversion, in accordance with the principles of Orthodox Judaism, is recognised by Orthodox Judaism as making a person an Orthodox Jew. Some of the greatest figures in Jewish history have been converts, starting with Ruth the Moabite, great grandmother of King David, and Onkelos, Rabbi Akiva and other sages. From conversion, a convert is treated as an Orthodox Jew, and so too is any child of a female convert born after the completion of the mothers conversion (although some distinction exists between converts and other Orthodox Jews: witness the prohibition on the former marrying a Cohen, to which reference is made above). The Chief Rabbi has in 2005 compared conversion with acquiring a changed, foreign identity, while adding that the analogy is imperfect: Converting to Judaism is a serious undertaking, because Judaism is not a mere creed. It involves a distinctive, detailed way of life. When people ask me why conversion to Judaism takes so long, I ask them to consider other cases of changed identity. How long does it take for a Briton to become an Italian, not just legally but linguistically, culturally, behaviourally? It takes time. The analogy is imperfect, but it helps to explain the most puzzling aspect of conversion today the sometimes different standards between rabbinical courts in Israel and Britain. Several decades ago an Israeli Chief Rabbi argued that Israeli rabbinical courts should be more lenient than their counterparts in the Diaspora. His reasons were technical, but they make sense. It is easier to learn Italian if you are living in Italy. In Israel, many aspects of Jewish identity are reinforced by the surrounding culture. Its language is the language of the Bible. Its landscape is saturated by Jewish history. Shabbat is the day of rest. The calendar is Jewish. The reason for Ms ineligibility can be said to be that his mother converted to Judaism under a procedure and principles other than those accepted by Orthodox Jews. However, M remains at a disadvantage because of his descent, and, speaking generally, the test for admission of any child to JFS is for practical purposes one of descent. The possibility of a child applying to JFS being him or herself a convert, or even in the course of converting, appears negligible. JFS in its answers dated 17 December 2007 believed there never to have been any such child in the three years preceding the answers. Further, discrimination may be on an ethnic ground, even though this is not the sole ground for the decision, so long as an ethnic ground was a cause, the activating cause, a substantial and effective cause, a substantial reason, an important factor: Nagarajan, per Lord Nicholls at pp.512H 512B. As Miss Rose QC for E pointed out, an organisation which admitted all men but only women graduates would be engaged in direct discrimination on the grounds of sex. Similar reasoning would apply here to any suggestion that the possibility of conversion eliminated any possibility of direct discrimination on ethnic grounds. Finally, I also consider it to be consistent with the underlying policy of s.1(1)(a) of the Act that it should apply in the present circumstances. The policy is that individuals should be treated as individuals, and not assumed to be like other members of a group: R (European Roma Rights Centre) v Immigration Officer at Prague Airport [2005] 2 AC 1, paras 82 and 90, per Baroness Hale of Richmond and R (Gillan) v Commissioner of Police for the Metropolis [2006] 2 AC 307, paras. 44 and 90 per Lords Hope of Craighead and Brown of Eaton under Heywood. To treat individual applicants to a school less favourably than others, because of the happenstance of their respective ancestries, is not to treat them as individuals, but as members in a group defined in a manner unrelated to their individual attributes. JFS, supported on this point by the British Board of Deputies, argue that respect for religious freedom under article 9(1) of the European Convention on Human Rights and the importance attaching to the autonomous existence of religious communities (emphasised for example in Lffelmann v Austria (Application no. 42967/98, 12 March 2009, para 47) militate in favour of a conclusion upholding JFSs admissions policy. But freedom to manifest one's religion or beliefs is, under article 9(2) of the Convention, subject to such limitations as are prescribed by law and are necessary in a democratic society for the protection of the rights and freedoms of others. Under the United Nations Convention on the Rights of the Child 1989, article 3, it is the best interests of the child which the United Kingdom is obliged to treat as a primary consideration. Under Protocol 1, article 2 to the European Convention on Human Rights, it is the right of parents to ensure education and teaching in conformity with their own religions and philosophical convictions that the state must ensure in the exercise of any functions which it assumes in relation to education and to teaching. (I note in parenthesis that this has, since the hearing before the Supreme Court, been emphasised by the second section of the European Court of Human Rights in its judgment in Affaire Lautsi c. Italie (Requte no. 30814/06, 3 November 2009, paras. 47(b) and (c)). I express no further view on the reasoning or decision in that case, which may well go to the Grand Chamber. To treat as determinative the view of others, which an applicant may not share, that a child is not Jewish by reason of his ancestry is to give effect not to the individuality or interests of the applicant, but to the viewpoint, religiously and deeply held though it be, of the school applying the less favourable treatment. That does not seem to me either consistent with the scheme or appropriate in the context of legislation designed to protect individuals from discrimination. I accept that parental responsibility and choice relating to a child can determine the extent to which children are treated as having certain attributes, e.g. membership of a particular religion in the case of Christian baptism. But neither parental birth nor the fact that a mother has not converted to Orthodox Judaism at a time prior to a childs birth can be regarded as within the concept of parental responsibility and choice. Emphasis was put in submissions on difficulties which Orthodox or indeed other Jewish schools face in adopting any admissions policy other than that based on Jewish status. It was not, and could not, be suggested that these present any absolute legal answer to Ms case, but rather that they should cause any court to think very hard about whether the legislation can really require the result for which E and M contend and which the Court of Appeal accepted. How far such difficulties exist is contentious. Just before the hearing in the Supreme Court, statements were tendered by two interveners, in the case of the British Board of Deputies a statement dated 15 October 2009 from its chief executive, Mr Jon Benjamin, and in the case of the United Synagogue a statement dated 18 October 2009 from its chief executive, Mr Jeremy Jacobs. These came too late for proper investigation or answer and their contents are in issue, though there is evidence of Orthodox Jewish schools which in addition to a test based on Orthodox Jewish descent also apply tests based on religious observance. What can be said is that, since the Court of Appeals judgment, JFS and other Orthodox Jewish schools have instituted admissions policies based, in one way or another, on religious observance, but they have done so very reluctantly, and submit that its introduction is inconsistent with such schools missions to all Orthodox Jews. However, as I have said, such considerations cannot be decisive either way. For the reasons I have given, the Court of Appeal in my view reached the correct conclusion, when it held that as a matter of law the admissions policy followed by JFS was inherently discriminatory, contrary to s.1(1)(a) of the 1976 Act, although the policy was adopted by the school for the most benign, religious motives. On that basis, the issue of indirect discrimination cannot arise. However, I will address some words to it. This must, necessarily, be on the hypothesis that a different answer is given on the issue of direct discrimination to that which I have given. Indirect discrimination The relevant statutory provision governing indirect discrimination is s.1(1A). This was introduced into the 1976 Act by the Race Relations Act 1976 (Amendment) Regulations (SI 2003/1626), in order to implement in Great Britain Council Directive 2000/43/EC of 29th June 2000 (which contains a number of references showing its intended application to education). Subsequent Regulations (SI 2008/3008) have added the presently immaterial words or would put in s.1(1A)(b). The first question arising under s.1(1A) is whether JFSs admissions policy involved a provision, criterion or practice which puts persons of the same race or ethnic origins at a particular disadvantage when compared with other persons. Lord Pannick submits not. He accepts that the policy had the effect of putting at a disadvantage applicants with no ethnic link with Judaism. But, in his submission, it did not discriminate against M, because both M and those eligible for admission had the same Jewish ethnic origin, and the distinction drawn between them by the policy was on the basis of their religious, not ethnic status. Here too, the Mandla test of ethnicity is relied upon to assimilate M and those eligible for admission. As I have pointed out, Mandla was decided under s.1(1)(b) of the Race Relations Act 1976. Since the introduction of s.1(1A) to give effect to Council Directive 2000/43/EC of 29th June 2000, Lord Pannick accepts that any allegation of indirect discrimination falls to be considered primarily (and in reality, despite s.1(1C), almost certainly only) under s.1(1A). Assuming, contrary to my view, that the Mandla test of ethnic grouping controls the question whether there has been direct discrimination on ethnic grounds within s.1(1)(a), I do not consider that it can do so under s.1(1A). I see no reason under Community law to suppose that the Directive is limited to discrimination against ethnic groups in the Mandla sense, and s.1(1A) should, so far as possible, be construed consistently with the Directive. The language of s.1(1A) is general (although in one respect, the effect if any of which I need not consider, it adopts less exhaustive terminology than s.1(1)(a) and (b), in so far as it omits express reference to colour and nationality). On any ordinary understanding, Ms ethnic origins differed from those of most Orthodox Jews, because he had a non Jewish Italian mother. As Munby J said (para. 34), M is in Es eyes, and doubtless in the eyes of many who would consider themselves Jews, of mixed Jewish and (through the maternal line) Italian ethnic origins. True, some Orthodox Jews become such by conversion rather than birth, and some children of non Jewish Italian mothers can be Orthodox Jews by virtue of their mothers conversion according to Orthodox Jewish principles before their birth. But, both in general terms and in the case of M in particular, his mothers non Jewish Italian birth and so his ethnic origins led to M being at a particular disadvantage when compared with persons recognised as Orthodox Jews by JFS and by Orthodox Jewish authorities. The next question is whether JFS has shown that the disadvantage at which M was put was a proportionate means of achieving a legitimate end. Munby J in para. 192 of his judgment summarised the aim or objective of JFS as spelled out in the materials before him (and indicated out in paragraph 76 above) as being: to educate those who, in the eyes of the [Office of the Chief Rabbi] are Jewish, irrespective of their religious beliefs, practices or observances, in a school whose culture and ethos is that of Orthodox Judaism. The Court of Appeals reasoning on indirect discrimination appears to have been influenced by this characterisation. The Court of Appeal thought, with some justification, that the aim or objective as so advanced was circular. Sedley LJ, in paras. 45 47, described the schools admissions criteria as explicitly related to ethnicity and as having an ethnic component in character and said that an aim of which the purpose or inevitable effect is to make and enforce distinctions based on race or ethnicity cannot be legitimate. That is no doubt so. But, on the evidence, the truth which Munby Js characterisation can be read as omitting or perhaps obscuring is that, in Orthodox Jewish belief, anyone who is regarded by Orthodox Judaism as a Jew by birth is also regarded as being under a religious duty to educate him or herself about and to observe the tenets of Orthodox Judaism: see the statement of Dayan Gelley dated 26 February 2008 referred to in paragraph 76 above, and also that of Registrar Frei of the London Beth Din dated 6 February 2008. JFSs mission was to encourage and assist children regarded by Orthodox Judaism as being Jews to do this as far as possible. For that reason, the admission to the school of a range of pupils, who are Orthodox Jewish in the schools eyes, but who do not actually practise Orthodox Judaism or necessarily any religion at all, was and would still be regarded as a very positive feature, even if their or their parents actual motivation for seeking their admission to the school were to have been its excellent academic record. On the basis of this explanation of the thinking underlying the schools policy, it is possible to identify a legitimate aim, founded in the schools Orthodox Jewish character and the religious convictions of those responsible for its admissions policy; and the circularity which the Court of Appeal thought existed no longer does. The question thus arises, which the Court of Appeal thought it unnecessary to address, whether JFS as the alleged discriminator can show the differential treatment to be a proportionate means of achieving a legitimate aim: s.1(1A)(c). JFS accepts that its admissions policy treated the schools religious aim as an over riding absolute. Prior to the Court of Appeals decision, it had not considered or sought to weigh the practical implications or effect of adopting either it or any alternative policy, though it was aware both that the school included many non observing pupils and that there were many ineligible pupils who were intensely religious. No information is in these circumstance available as to the extent to which children admitted to the school were or became interested in learning to observe Orthodox Judaism, or to which the schools policy excluded other children who would be deprived of Jewish based schooling which they were keen for religious reasons to pursue. Munby J recorded (para. 8) that until the 1940s over 97% of synagogue membership was of Orthodox (United Synagogue) synagogues, but that by 2000, according to a report A Community of Communities, published under the auspices of the Institute for Jewish Policy Research, current membership of Jews affiliated to a synagogue consisted of 60.7% Orthodox, 10.5% Strictly Orthodox (Haredi), 27.3% Progressive (Reform and |Liberal), and 1.5% Masorti (Conservative), while 30% of all Jews were not affiliated to any synagogue at all. There has been and is a paucity of available and accessible Jewish schools other than Orthodox Jewish schools it appears that 29 of the total of 36 Jewish schools in England are Orthodox Jewish and applied a similar admissions policy to JFSs. JFS also regarded as irrelevant when formulating the admissions policy whether it might lead to unhappiness in relations between adherents to different Jewish denominations. The standard set in s.1(1A)(c) is a high one, adopting the more exacting EC test of proportionality: R (Elias) v Secretary of State for Defence [2006] 1 WLR 3213, para. 151, per Mummery LJ. The Directive also provides, in article 2(2)(b) that any indirectly discriminatory provision, criterion or practice is only justifiable if it is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary, but it refers to the European Convention on Human Rights and the language used equates with the test of proportionality which appears in s.1(1A)(c) of the 1976 Act. An ex post facto justification for a measure which is prima facie indirectly discriminatory can prove difficult to show: Elias, para.129 per Mummery LJ. It is for the school to show, in the circumstances, that its aim or objective corresponds to a real need and that the means used are appropriate and necessary to achieving that aim, and any decision on these points must weigh the need against the seriousness of the detriment to the disadvantaged group: Elias, para. 151 per Mummery LJ. The interests of society must also be considered: Huang v Secretary of State for the Home Department [2007] UKHL 11; [2007] 2 AC 167, para. 19, per Lord Bingham of Cornhill. In the case of JFS, as an educational establishment maintained by a local education authority, its general duty was supplemented by specific duties under s.71 of the 1976 Act, according to which it was incumbent on its governing body in carrying out its functions, [to] have due regard to the need (a) to eliminate unlawful racial discrimination; and (b) to promote equality of opportunity and good relations between persons of different racial groups. Munby J held that the school had, despite the good intentions and work which had gone into its race equality policy, failed to comply in full with s.71 of the 1976 Act. The schools race equality policy, which indicated that the school would disregard considerations based upon colour, disability, ethnic or racial origins, gender, marital status, nationality or religion except as provided for in the Schools authorised Admissions Policy, showed that it had in a general sense considered matters of racial discrimination. But it had not specifically considered either of the goals mentioned in s.71(1)(a) and (b) or, more particularly, specific ways in which these goals might be achieved (Munby J, para. 213). Nonetheless, Munby J considered that the schools policy satisfied the requirements of s.1(1A)(c), saying at paras. 199 202, first, that JFSs admissions policy was not, properly analysed, materially different from that which gives preference in admission to a Muslim school to those who were born Muslim or preference in admission to a Catholic school to those who have been baptised and, secondly, that some alternative admissions policy based on such factors as adherence or commitment to Judaism (even assuming that such a concept has any meaning for this purpose in Jewish religious law) would not be a means of achieving JFSs aims and objectives; on the contrary it would produce a different school ethos. JFS exists as a school for Orthodox Jews. If it is to remain a school for Orthodox Jews it must retain its existing admissions policy; if it does not, it will cease to be a school for Orthodox Jews. On that basis, Munby J held that the policy constituted a proportionate means of achieving a legitimate aim, and that the claim of indirect discrimination failed. Munby J also thought it quite idle to imagine that the fullest and most conscientious compliance with s.71 would have led to any difference either in the crucial part of JFSs admissions policy or in its application in Ms case (para. 214). On the evidence before the Court, and in the absence of any actual consideration or weighing of the need [to pursue the schools aim] against the seriousness of the detriment to the disadvantaged group (see Elias [2006] 1 WLR 3213, para 151), I find it impossible to reach the same conclusion. There is, as I have indicated, no information about the extent to which the school succeeds in its stated aim of inculcating Orthodox Judaism in the minds and habits not only of those who already practise it, but also of those pupils who gain admission as Orthodox Jews in the eyes of Orthodox Judaism. The latter may not on entry practise or have any interest in practising Orthodox Judaism. They or their parents may adhere in religious observance to a Jewish denomination other than the Orthodox Jewish and be concerned that their children receive a, rather than no, Jewish education; or they or their parents may be seeking entry for reasons associated with the schools acknowledged educational excellence, and may be themselves agnostic or atheist. The schools policy was formulated without considering the extent to which others professing the Jewish faith, but not in the Orthodox Jewish tradition, were separated by it from friends and from the general Jewish community by the schools admissions policy, or about the extent to which this might cause grief and bitterness in inter or intra community relations matters about which some evidence was tendered before the Court. It would, in parenthesis, also appear difficult to regard a school not considering such matters as complying with the School Admissions Code 2007, para. 2.48, which requires that admission authorities for faith schools should consider how their particular admission arrangements impact on the communities in which they are physically based and those faith communities which they serve. It was submitted that the school would become less diverse in a practising religious sense, if it admitted pupils only by reference to a test of Jewish religious observance. This could be so, but no consideration has been given to any possibility of ensuring continuing diversity on a structured basis, rather than simply excluding, by reference essentially to birth link criteria, all those not regarded by Orthodox Judaism as Orthodox Jews. Paragraph 1.4 of the schools existing admissions policy already provides that The School recruits from the whole range of ability, and this policy has the objective of securing a balanced, comprehensive, co educational intake. The schools Information Sheet for staff describes the modern JFS as serving almost the whole breadth of the Anglo Jewish community in Greater London and its admissions policy (not further detailed in this connection) as reflect[ing] positive selection to ensure a truly comprehensive ability intake. It continues: We aim to achieve a balanced intake across four ability bands. In addition to a thoroughly comprehensive spread of ability, our students come from the widest possible range of social, economic and religious backgrounds. On the information available, it is not shown that inability to select on the basis of birth link criteria will prevent the school from serving the wider community and achieving diversity in accordance with these stated aims. I would also not be as confident as Munby J was with regard to s.71. But, in any event, the test is not what the school would have done in the past if it had fully and properly considered its obligations under s.71. The test is whether objectively it can justify its present policy under s.1(1A)(c), once the test set by that subsection is fully and properly addressed. Munby Js comparison in para. 200 with the position of Catholic or Muslim children would, if exact, be no more than another way of stating the issue, but in reality it is not exact, at least if one takes the parental choice to baptise. His other reason echoes the schools case that its policy of giving preference to those regarded as Orthodox Jews by Orthodox Jews must, in case of over subscription, prevail over all other considerations, with which I have already dealt. It must, furthermore, be an exaggeration to say that the school would cease (or, presumably, with the introduction of its new policy after the Court of Appeals decision, has ceased) to be a school for Orthodox Jews (para. 214). If and when the number of places exceeds the number of those applying who are regarded by the school as Orthodox Jews, the school is anyway obliged under the legislation and paragraph 1.3 of its own admissions policy to admit other pupils. Until the matter came before the Adjudicator, Appendix A to its admissions policy in fact indicated that the remaining places would be filled according to the following criteria in this order: (1) looked after children, (2) children with one Jewish parent, (3) children with one or more Jewish grandparents and, finally, (4) all other applicants. (The Adjudicator by his Determination of 27 November 2007 held that criteria (2) and (3) involved indirect ethnic discrimination by reference to ancestry, which could not be justified by any presumption that children with one Jewish parent or one or more Jewish grandparents were more likely to be receptive or sympathetic to the schools Jewish Orthodox ethos than children of other parentage or grand parentage, and required the deletion of those two criteria on that basis. He rejected a suggestion that criteria (2) and (3) involved direct discrimination on the ground that they were based on religious grounds not racial grounds, despite the absence of any apparent basis in Orthodox Judaism for attaching any significance to fatherhood or grand parentage, except in the matrilineal line. Miss Rose QC for E submits, correctly in my view as I have already indicated, that the Adjudicator should logically have gone further by recognising criteria (2) and (3) as involving direct discrimination). In my view and (I emphasise) on the material before the Court, JFS has not and could not have justified its admissions policy. Accordingly, had the matter arisen for decision, I would have held that its admissions policy discriminated against M in a way which was not justified under s.1(1A), and was invalid accordingly. However, for reasons given earlier, I conclude that the policy was directly discriminatory, because it depended on birth link criteria which led to M being less favourably treated on ethnic grounds within s.1(1)(a) and 3(1) of the 1976 Act, and invalid on that basis. I would therefore dismiss the schools appeal. On the United Synagogues appeal in respect of costs, I agree with the reasoning and conclusions of Lord Hope. LORD KERR This case gives rise to perplexing issues of law. It involves an examination of the interface between religion and legal principle. It requires a close scrutiny of the statutory definition of racial discrimination. At its heart, however, lies the simple issue of a young boys desire to attend a particular school; his familys earnest wish that he be educated there; and the reasons that he was refused admission. That JFS is the school of choice for very many Jewish families is not in the least surprising. As well as achieving excellent academic results for its pupils, it promotes indeed embodies the values that most, if not all, practising Jews regard as central to their faith. It is therefore inevitably and regularly oversubscribed, that is to say, it attracts many more applicants for places than it can accommodate. The criteria for admission to the school are of intense interest to aspiring pupils and their parents. Those who devise and apply those criteria have a formidable, not to say daunting, responsibility. This situation is by no means unique. All over the United Kingdom and, no doubt, in many other parts of the world, every year, conscientious parents, anxious for their childrens continuing education at secondary level, pore over the entrance requirements for schools that they hope their sons and daughters will attend and strive to bring their childrens circumstances and in many instances, their own within the stipulated standards. Where JFS is unique, however, is in its imposition of a criterion that can only be achieved by an accident of birth or by conversion to the Orthodox Jewish faith. Apart from conversion, a child who wishes to be educated at JFS must be born of an Orthodox Jewish mother or have a female antecedent who is recognised as an Orthodox Jew by the Office of the Chief Rabbi (OCR). That condition of Orthodox Jewishness is normally acquired by the female by reason of the circumstances in which she herself was born; less commonly, it arises by her conversion to Judaism before the childs birth. In the latter case the circumstances of her conversion must be such as to satisfy the requirements of the OCR. Common to both situations, however, is the unalterable requirement that, at the moment of birth, the child must be a Jew as the Chief Rabbi, in his application of what he considers to be the requirements of Jewish law, defines that status. Central to the question of direct discrimination in this case is the breadth of meaning to be given to the phrase ethnic origins. The conventional meaning of origin is something from which anything arises or is derived. It also means ancestry, parentage, or extraction. Although ethnic is normally used as pertaining to or characteristic of a people or a group, clearly there can be mixed ethnic origins that do not fall neatly into one group or category. Thus, in this case, it is undeniable that M has mixed ethnic origins. He has derived these, as everyone derives their ethnicity, from his parents. At the moment of birth we are all endowed with characteristics that are as inalienable as they are inevitable. Our DNA is inescapable. Our parentage and the ancestry that it brings are likewise fixed and irreversible. These are part and parcel of our ethnic origins. M is not simply a Jew. His ethnic origins comprehend much more than his Jewishness. He is born of an Italian. He is, in the colloquial, half Italian. He would be recognised indeed, no doubt, claimed as such by his mothers family. He cannot disavow his mothers former Catholicism. That is as much part of his undeniable ethnic make up as is his fathers Masorti Jewishness and Englishness. M is, therefore, half English and half Italian; he is a Masorti Jew with an Italian mother who was once Catholic. All of these are aspects of his ethnic origins. And those origins are defined as much by what they do not contain as they are by what they include. What, of course, Ms ethnic origins do not and can never include is a matrilineal connection to Orthodox Jewry. That is an unchangeable aspect of his parentage, of his origins and of his ethnicity. He cannot be categorised as and can never claim to be born of an Orthodox Jewish mother as recognised by OCR. That this forms part of his ethnic origins can perhaps best be illustrated by comparing his situation with that of someone whose mother is recognised by OCR as Jewish. An assertion by such a person that this matrilineal feature formed part of his ethnic origins could surely not be challenged. Logically, therefore, the absence of such a feature from Ms heritage cannot be denied, and must be accepted, as a defining characteristic of his ethnicity. Direct discrimination The basic question that arises on the issue of direct discrimination can be simply stated. It is, Was M treated less favourably on racial grounds? Racial grounds being defined (in section 3 (1) of the Race Relations Act 1976) as including ethnic origins, and there being no dispute between the parties that he was treated less favourably than those who, by reason of their matrilineal connection to an Orthodox Jewish mother, were admitted to the school, the basic question can be refined to the following formulation, Was M refused admission to the school on grounds of his ethnic origins? It has been strongly asserted that the Chief Rabbi was not remotely interested in Ms ethnic origins for other than religious reasons. This is no doubt true, but the decision to refuse M entry to the school was unquestionably bound up with those origins. It was because of what was missing from Ms ethnic origins; because they did not include the indispensable matrilineal connection to Orthodox Judaism that the less favourable treatment occurred. Does this mean that he was discriminated against on ethnic grounds? Or does the fact that the refusal to admit him to the school was based on a decision on a religious issue remove the case from the sphere of racial discrimination altogether? These questions focus attention on the problematical issue of what is meant by discrimination on racial grounds. As Lord Hope has observed, the opinions in cases such as R v Birmingham City Council, Ex p Equal Opportunities Commission [1989] AC 1155 and James v Eastleigh Borough Council [1990] 2 AC 751 tended to dismiss as irrelevant any consideration of the subjective reasons for the alleged discriminator having acted as he did unless it was clear that the racial or sex discrimination was overt. A benign motivation on the part of the person alleged to have been guilty of discrimination did not divest the less favourable treatment of its discriminatory character if he was acting on prohibited grounds. Later cases have recognised that where the reasons for the less favourable treatment are not immediately apparent, an examination of why the discriminator acted as he did may be appropriate. In Nagarajan v London Transport [2000] 1 AC 501, 511A, Lord Nicholls of Birkenhead, having identified the crucial question as why did the complainant receive less favourable treatment, said this: Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator. It is, I believe, important to determine which mental processes Lord Nicholls had in mind in making this statement. It appears to me that he was referring to those mental processes that are engaged when the discriminator decides to treat an individual less favourably for a particular reason or on a particular basis. That reason or the basis for acting may be one that is consciously formed or it may operate on the discriminators subconscious. In my opinion Lord Nicholls was not referring to the mental processes involved in the alleged discriminator deciding to act as he did. This much, I believe, is clear from a later passage of his opinion, at p 511B where he said: The crucial question just mentioned is to be distinguished sharply from a second and different question: if the discriminator treated the complainant less favourably on racial grounds, why did he do so? The latter question is strictly beside the point when deciding whether an act of racial discrimination occurred. This latter passage points clearly to the need to recognise the distinction between, on the one hand, the grounds for the decision (what was the basis on which it was taken) and on the other, what motivated the decision maker to make that decision. The need for segregation of these two aspects, vital to a proper identification of the grounds on which the decision was made, is well illustrated, in my view, by the circumstances of this case. The school refused entry to M because an essential part of the required ethnic make up was missing in his case. The reason that they took the decision on those grounds was a religious one OCR had said that M was not a Jew. But the reason that he was not a Jew was because of his ethnic origins, or more pertinently, his lack of the requisite ethnic origins. The basis for the decision, therefore, or the grounds on which it was taken, was Ms lack of Jewishness. What motivated the school to approach the question of admission in this way was, no doubt, its desire to attract students who were recognised as Jewish by OCR and that may properly be characterised as a religious aspiration but I am firmly of the view that the basis that underlay it (in other words, the grounds on which it was taken) was that M did not have the necessary matrilineal connection in his ethnic origin. This conclusion appears to me to be inescapable from Lord Nicholls analysis of the two aspects of decision making and to chime well with a later passage in his speech where he said: Racial discrimination the is not negatived by discriminators motive or intention or reason or purpose (the words are interchangeable in this context) in treating another person less favourably on racial grounds. In particular, if the reason why the alleged discriminator rejected the complainants job application was racial, it matters not that his intention may have been benign. In the present case, the reason why the school refused M admission was, if not benign, at least perfectly understandable in the religious context. But that says nothing to the point. The decision was made on grounds which the 1976 Act has decreed are racial. The recognition of Jewishness a religious question? As Lord Brown has pointed out, all Jews define membership of their religion by reference to descent or conversion. It is therefore quite logical to describe the decision, taken as a matter of Jewish law, as to whether one is or is not a Jew, as a religious one. Descent is employed as a means of determining an essentially religious question. But, when the answer to that religious question has consequences in the civil law sphere, its legality falls to be examined. If the decision has consequences that are not permitted under the law, the fact that it was taken for a religious purpose will not save it from the condition of illegality. In this case the OCR decision that M was not a Jew had profound consequences for him since he was denied admission to an educational establishment that he wished to attend. The fact that the decision not to admit him was based on the determination of a religious issue cannot, of itself, insulate it from the charge of discrimination on racial grounds. Once it is recognised that Ms ethnic origins underpinned the conclusion on the religious issue, it becomes plain that it cannot be characterised as an exclusively religious question. The terminus for OCR was a decision on a matter of religion but the route to that terminus was one of ethnic origin. Ethnic groups It is unquestionably true that Jews, whether they be Orthodox, Masorti, Liberal or Progressive, constitute an ethnic group. It is also undoubtedly the case that M belongs to that ethnic group. He is an ethnic Jew. But, belonging to that group is not comprehensive of his ethnicity. As I have said (at 109 above) Ms ethnic origins extend well beyond the fact that he is a Jew. The circumstance that he is an ethnic Jew in the Mandla [Mandla v Dowell Lee [1983] 2 AC 548] sense does not assist, in my opinion, in determining whether he has been discriminated against on racial grounds. Although those who receive the more favourable treatment (in being admitted to the school) belong to the same racial or ethnic group as M, this does not, of itself, preclude a finding that he has been treated less favourably on account of his ethnic origins. This might be so if his ethnic origins were confined to his Jewishness. They are not. It is because of his lack of the requisite feature of Jewishness that he has received less favourable treatment. That perceived deficiency is as much part of his ethnic make up as is the fact that he is an ethnic Jew in the Mandla sense. Indirect discrimination Since I have reached the conclusion that this is a case of direct discrimination, it is unnecessary to say anything about the alternative case made on Ms behalf on indirect discrimination, particularly in light of Lord Mances discussion of that subject. I find myself in complete agreement with all that he has had to say on that issue and, incidentally, with all that he has had to say on the issue of direct discrimination. Conclusion One can have sympathy with the school authorities in their wish to pursue what must have seemed to them an entirely legitimate religious objective. It is plain that the Chief Rabbi and the governors of JFS are entirely free from any moral blame. That they have fallen foul of the 1976 Act does not involve any reprehensible conduct on their part for it is accepted on all sides that they acted on sincerely and conscientiously held beliefs. Their motives are unimpeachable. The breach of the legislation arises because of the breadth of its reach. The grounds on which the rejection of M was made may well be considered perfectly reasonable in the religious context but it is because they amount to ethnic grounds under the legislation that a finding against the school became, in my opinion, inescapable. I would dismiss the appeal. LORD CLARKE The division of opinion in this court and in the courts below demonstrates that this appeal raises issues which are difficult to resolve. The issues have been discussed in detail in all the above judgments. I have reached the same conclusion as Lord Phillips, Lady Hale, Lord Mance and Lord Kerr, essentially for the reasons they have given. Rather against my general principle, which is that there should be fewer judgments in the Supreme Court and not more, I add a judgment of my own in order to explain my own reasons for agreeing that the appeal should be dismissed. Direct discrimination The facts have been fully set out by others. I therefore refer only to those facts which seem to me to be critical. The policy of JFS, when oversubscribed, was to admit children who are recognised as being Jewish by the Office of the Chief Rabbi (OCR) or who have already enrolled upon or undertaken, with the consent of their parents, to follow a course of conversion to Orthodox Judaism under the approval of the OCR. As I understand it, nobody has ever been enrolled at JFS under the second head. Leaving adopted children on one side, children recognised by the OCR as being Orthodox Jewish are only those with a biological mother who is either Orthodox Jewish by birth or who has converted to Orthodox Judaism before the birth of the child by a process approved by the OCR. As I see it, the sole question for decision is whether those criteria offend section 1(1)(a) of the 1976 Act (as amended) by discriminating against some children (here M) on racial grounds, which, by section 3, include ethnic origin. On the facts of this case I prefer to ask whether the criteria offend against some children on the ground of their ethnic origin. To my mind the answer to that question does not depend upon the subjective state of mind of the Chief Rabbi or anyone else. Moreover, I do not think that the correct question to ask is whether OCRs guidance was given either on grounds of ethnic origin or on grounds of religion. That is because, so formulated, the test suggests that, if the guidance was given on the grounds of religion, it was not given on the grounds of ethnic origin. So formulated, the question could have only one answer because I entirely accept that the guidance was given on grounds of religion. That is clear from the guidance itself and indeed from a wealth of evidence before the court. Moreover, I fully understand that it can in one sense be said that those not recognised by the criteria as Orthodox Jews are, as Lord Brown puts it, being treated less favourably, not because of their ethnic origins, which he says are a matter of total indifference to the OCR, but rather because of their religion because they are not members of the Orthodox Jewish religion. However, again as Lord Brown puts it, the reason they are not members of the Orthodox Jewish religion is that their forbears in the matrilineal line were not recognised as Jewish by Orthodox Jews and in this sense their less favourable treatment is determined by their descent. Thus the ground upon which the OCR criteria defined those children to be admitted was that their forbears in the matrilineal line must be recognised as Jewish by Orthodox Jews. As I see it, in agreement with Lord Phillips, Lady Hale, Lord Mance and Lord Kerr, that is an ethnic ground, so that the discrimination was on both ethnic grounds and religious grounds. It is, in my opinion, wrong in principle to treat the question as an either/or question because that excludes the possibility that there were two grounds for the decision to exclude M, one religious and the other ethnic. If the religious ground was itself based upon an ethnic ground, then in my opinion the question asked by section 1(1)(a) of the 1976 Act, namely, whether M was discriminated against on ethnic grounds must be answered in the affirmative. It would be too narrow a construction of section 1(1)(a) to hold that that was not to discriminate on ethnic grounds. M was excluded because his mother was not Orthodox Jewish, whether by birth or conversion. That conclusion does not depend upon the state of mind of the OCR, but follows from an examination of the criteria laid down by the OCR. The question is not whether the guidance was given on religious grounds but whether the admitted discrimination was on ethnic grounds. In my opinion the answer is that the discrimination was on both religious and ethnic grounds because the criteria were arrived at on religious grounds but, since those religious grounds involved discrimination on ethnic grounds, it follows that the admissions policy of JFS was contrary to section 1(1)(a) because it discriminated against M and others on racial grounds. To hold that there were two grounds for the discrimination, both religious and ethnic, is not in my opinion to reduce, as Lord Rodger suggests, the religious element to the status of a mere motive. It is to recognise that the ethnic element is an essential feature of the religious ground. If Ms mother had been born a Masorti Jew (because someone in her matrilineal line been converted to Masorti Judaism) and had not been converted to Orthodox Judaism before Ms birth, Ms application would have been rejected because his mother was not, in the relevant sense, Jewish by birth. As I see it, for the reasons given in much more detail by others (and in particular Lord Mance) that would be discrimination on the ground of his ethnicity. To my mind the same is true on the facts of this case since at the time of Ms birth his mother was not, in the relevant sense, Jewish because she had not been converted to Orthodox Judaism in the manner accepted by the OCR. In both cases, as Lord Kerr puts it, the problem would be that M does not have the necessary matrilineal connection in his ethnic origin. Again as Lord Kerr puts it, the terminus for the OCR was a decision on a matter of religion but the route to that terminus was one of ethnic origin. In my opinion the state of mind of JFS, the Chief Rabbi and the OCR are all irrelevant to the determination of the critical question under section 1(1)(a). I agree with Lord Mance that there are two ways in which direct discrimination can be established. The first is where, whatever the motive and whatever the state of mind of the alleged discriminator, the decision or action was taken on a ground that was inherently racial and the second is where the decision or action was taken on a ground that was subjectively racial. Until now this distinction has not perhaps been as clearly identified in the authorities as it should be. The first class of case was established by R v Birmingham County Council ex p Equal Opportunities Commission [1989] AC 1155, where (as Lord Mance puts it) girls were required to achieve a higher standard than boys for grammar school entry because of a disparity in the number of grammar school places for boys and girls. Lord Goff, with whom the other members of the appellate committee agreed, made it clear at page 1194B that the question was simply whether there was less favourable treatment on the ground of sex, in other words if the relevant girl or girls would have received the same treatment as the boys but for their sex. The intention or motive of the council was not a necessary condition of liability. That was a question of fact and it was held by Lord Goff in the passage quoted by Lord Mance from page 1194C D that whatever may have been the intention or motive of the council, nevertheless it is because of their sex that the girls in question receive less favourable treatment than the boys, and so are the subject of discrimination under the Act of 1975. In James v Eastleigh Borough Council [1990] 2 AC 751, the swimming pool case, it was held that the test for free entry to the swimming pool at pensionable age unlawfully discriminated against men because men did not reach pensionable age until 65 whereas women reached it at 60. It is true that the House of Lords divided three to two but that seems to me to be irrelevant. The simple question was again a question of fact, namely whether men and women were treated differently. It was held that they were, even though, as Lord Mance has suggested, the test was probably adopted because it was thought that those of pensionable age would be more needy. Lord Goff said much the same as he had said in the Birmingham case. He put it thus at page 772B G: I turn to that part of the Vice Chancellor's reasoning which is based upon the wording of section 1(1)(a). The problem in the present case can be reduced to the simple question did the defendant council, on the ground of sex, treat the plaintiff less favourably than it treated or would treat a woman? As a matter of impression, it seems to me that, without doing any violence to the words used in the subsection, it can properly be said that, by applying to the plaintiff a gender based criterion, unfavourable to men, which it has adopted as the basis for a concession of free entry to its swimming pool, it did on the ground of sex treat him less favourably than it treated women of the same age and in particular Mrs. James. In other words, I do not read the words on the ground of sex as necessarily referring only to the reason why the defendant acted as he did, but as embracing cases in which a gender based criterion is the basis upon which the complainant has been selected for the relevant treatment. Of course, there may be cases where the defendant's reason for his action may bring the case within the subsection, as when the defendant is motivated by an animus against persons of the complainant's sex, or otherwise selects the complainant for the relevant treatment because of his or her sex. But it does not follow that the words on the ground of sex refer only to case where the defendants reason for his action is the sex of the complainant; and, in my opinion, the application by the defendant to the complainant of a gender based criterion which favours the opposite sex is just as much a case of unfavourable treatment on the ground of sex. Such a conclusion seems to me to be consistent with the policy of the Act, which is the active promotion of equal treatment of men and women. Indeed, the present case is no different from one in which the defendant adopts a criterion which favours widows as against widowers, on the basis that the former are likely to be less well off; or indeed, as my noble and learned friend, Lord Bridge of Harwich has pointed out, a criterion which favours women between the ages of 60 and 65, as against men between the same ages on the same basis. It is plain to me that, in those cases, a man in either category who was so treated could properly say that he was treated less favourably on the ground of sex, and that the fact that the defendant had so treated him for a benign motive (to help women in the same category, because they are likely to be less well off) was irrelevant. Lord Bridge and Lord Ackner said much the same. For example, Lord Bridge said at page 763H that the use of the statutory criterion for pensionable age, being fixed at 60 for women and 65 for men, was to use a criterion which directly discriminated between men and women. See also per Lord Bridge at page 765G. Lord Ackner said at page 769F H that the formula used was inherently discriminatory. He noted that no evidence had been given in the county court as to why the council had decided on the policy. He said that such evidence would have been irrelevant because, as he put it, the policy was crystal clear. If you were a woman you could swim at 60 without payment whereas if you were a man you had to wait until you were 65. The reason why the policy was adopted could in no way affect or alter the fact that the council had decided to implement a policy by virtue of which men were to be treated less favourably than women and were to be treated on the ground of, ie by reason of, their sex. In my opinion that analysis applies here. Just as in that case the admissions criteria were gender based and thus discriminatory on the ground of sex contrary to section 1(1)(a) of the Sex Discrimination Act 1975, so here the JFS admissions criteria were based on ethnicity and thus discriminatory on racial grounds as defined in section 1(1)(a) of the 1976 Act. For my part I do not accept that more recent decisions of the House of Lords call for a more nuanced approach than that stated in the Birmingham and Eastleigh cases. As I read the later cases, they simply accept, as Lord Goff accepted in the passage from his speech in the Eastleigh case quoted above, that there may be cases where the defendant's reason for his action may bring the case within the subsection, as when the defendant is motivated by an animus against persons of the complainant's sex, or otherwise selects the complainant for the relevant treatment because of his or her sex or (I am sure he would have added) because of his or her race or ethnicity. As I see it, this is a separate basis on which direct discrimination can be established. It does not involve any alteration to the principle stated by Lord Goff, Lord Bridge and Lord Ackner and set out above. In Nagarajan v London Regional Transport [2000] 1 AC 501 the House of Lords was concerned with an allegation of alleged unlawful victimisation under section 2 of the 1976 Act. It applied the same principles as those applicable under section 1(1)(a). The leading speech was given by Lord Nicholls, Lord Steyn made a concurring speech, Lord Hutton and Lord Hobhouse agreed with Lord Nicholls and Lord Steyn, and Lord Browne Wilkinson dissented. Lord Steyn said at page 520H that the Birmingham and Eastleigh cases established the principle that conscious motivation is not required for direct discrimination. In these circumstances it is inherently unlikely that there is any distinction between the principles established by those cases and the reasoning in Nagarajan. In my opinion there is not. Reliance was placed on part of the speech of Lord Nicholls. Read in context, the relevant passage is in these terms at pages 510H 511E: The first point raised is whether conscious motivation is a prerequisite for victimisation under section 2 of the Act. Section 2 should be read in the context of section 1. Section 1(1)(a) is concerned with direct discrimination, to use the accepted terminology. To be within section 1(1)(a) the less favourable treatment must be on racial grounds. Thus, in every case it is necessary to inquire why the complainant received less favourable treatment. This is the crucial question. Was it on grounds of race? Or was it for some other reason, for instance because the complainant was not so well qualified for the job? Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator. Treatment, favourable or unfavourable, is a consequence which follows from a decision. Direct evidence of a decision to discriminate on racial grounds will seldom be forthcoming. Usually the grounds of the decision will have to be deduced, or inferred, from the surrounding circumstances. The crucial question just mentioned is to be distinguished sharply from a second and different question: if the discriminator treated the complainant less favourably on racial grounds, why did he do so? The latter question is strictly beside the point when deciding whether an act of racial discrimination occurred. For the purposes of direct discrimination under section 1(1)(a), as distinct from indirect discrimination under section 1(1)(b), the reason why the alleged discriminator acted on racial grounds is irrelevant. Racial discrimination is not negatived by the discriminator's motive or intention or reason or purpose (the words are interchangeable in this context) in treating another person less favourably on racial grounds. In particular, if the reason why the alleged discriminator rejected the complainant's job application was racial, it matters not that his intention may have been benign. For instance, he may have believed that the applicant would not fit in, or that other employees might make the applicant's life a misery. If racial grounds were the reason for the less favourable treatment, direct discrimination under section 1(1)(a) is established. (My emphasis) Lord Nicholls then added at page 511E H that this law, which is well established was confirmed by the House of Lords in the Birmingham and Eastleigh cases as described above. He said that in the Birmingham case the answer to the crucial question was plain because, as a matter of fact, girls received less favourable treatment than boys. It followed that there was direct sex discrimination and the reason for it was irrelevant. The same was true in Eastleigh because the reduction in swimming pool charges was geared to a criterion which was itself gender based. It is true that Lord Nicholls added this: Lord Bridge of Harwich, at p 765, described Lord Goff's test in the Birmingham case as objective and not subjective. In stating this he was excluding as irrelevant the (subjective) reason why the council discriminated directly between men and women. He is not to be taken as saying that the discriminator's state of mind is irrelevant when answering the crucial, anterior question: why did the complainant receive less favourable treatment? The essence of Lord Nicholls view can be seen in the italicised passages in the quotation at para 139 above. If, viewed objectively, the discriminator discriminated against the claimant on racial grounds the reason why he did so is irrelevant. Thus in Birmingham and Eastleigh the sex discrimination was objectively plain from the criteria adopted. Once that was established, the state of mind of the discriminator was, as Lord Nicholls put it, strictly beside the point. That, as I see it, is this case. This is a plain or obvious case of the kind Lord Nicholls had in mind because the position is clear from the OCRs criteria. When he said in the first of the italicised passages that, save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator, he had in mind, not this kind of case, which he would have regarded as obvious, but the kind of case he had just mentioned namely where the claimant was discriminated against but it was not clear whether that was because of unlawful discrimination on the ground of, say, race or sex, or for some other reason, for instance, because the complainant was not so well qualified for the job. This is not such a case. In this connection I cannot agree with Lord Hopes analysis of the passage quoted at para 194 from page 512 of Lord Nicholls speech in Nagarajan. Lord Nicholls was there considering the question of unconscious motivation. He was doing so because that was not a case of discrimination inherent in the relevant rules such as existed in Birmingham, Eastleigh and this case. In these circumstances it is not, in my opinion, possible to draw from that passage in Lord Nicholls speech the proposition that if, after careful and thorough investigation, the tribunal were to conclude that the employers actions were not racially motivated, in the sense that race was not the reason why he acted as he did, it would be entitled to draw the inference that the complainant was not treated less favourably on racial grounds. It would not be so entitled for the reasons given in Birmingham and Eastleigh, namely that this is a case of inherent discrimination. Equally, when Lord Nicholls said in Chief Constable of West Yorkshire Police v Khan [2001] 1 WLR 1947, para 29 that the question was why the discriminator acted as he did or, put another way, what consciously or unconsciously was his reason, Lord Nicholls was not considering this kind of case. For the same reason I do not think that the decision in Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] UKHL 11, [2003] ICR 337, is of any assistance in this kind of case. In these circumstances I agree with Lord Hope at para 195 that at the initial stage, when the question is whether or not the discrimination was on racial grounds, the alleged discriminators motivation may not only be relevant but also necessary, in order to reach an informed decision as to whether or not this was a case of racial discrimination. However, I emphasize the word may because, for the reasons I have already given, the discriminators motivation or subjective reasoning is not in my opinion relevant in every case. The authorities, namely Birmingham, Eastleigh and Nagarajan show that it is not relevant where the criteria adopted or (in Lord Ackners words) the formula used are or is inherently discriminatory on ethnic grounds. Lord Nicholls has however shown that it is relevant in other cases where, without investigating the state of mind of the alleged discriminator, it is not possible to say whether the discrimination was on ethnic grounds or not. The question arises what considerations are relevant in answering the question whether the criteria were inherently racial. I entirely accept (and there is indeed no dispute) that JFS, the Chief Rabbi and the OCR are, as Lord Hope puts it at para 201, thoughtful, well intentioned and articulate and that, as Lord Pannick submitted, the Chief Rabbi was not in the least interested in Ms ethnicity. It is true that, if the Chief Rabbi were asked why he acted as he did, he would say that his reason was that this was what was required of him by fundamental Orthodox Jewish religious law. Again as Lord Hope puts it, Jewishness based on matrilineal descent from Jewish ancestors has been the Orthodox religious rule for many thousands of years, subject only to the exception for conversion. I agree so far. However, I do not agree that to say that his ground was a racial one is to confuse the effect of the treatment with the ground itself. The reason I disagree with Lord Hope (or perhaps the ground on which I do so) is that his opinion depends upon the state of mind of the Chief Rabbi. Thus in the passage in Lord Nicholls speech to which Lord Hope refers Lord Nicholls was considering the kind of case in which it is necessary to consider the mental processes of the alleged discriminator. Lord Hope makes it clear at para 201 that to categorise the criteria as based on racial grounds might be justified if there were reasons for doubting the Chief Rabbis frankness or good faith. However, to my mind it does not follow that the criteria were not based on racial grounds because neither the Chief Rabbi nor the OCR thought that they were. If the religious grounds were themselves based on racial (or ethnic) grounds then one of the grounds upon which there was discrimination based on the criteria was ethnic. This appears from both the Birmingham and the Eastleigh cases. I have already expressed the view that the principles in those cases apply here. Lord Rodger however says that they do not come into the picture. As I see it, that could only be on the basis that the issue is resolved by the subjective state of mind of the Chief Rabbi, the OCR and the governors of JFS. It is said that the governors were not asked to consider and, did not actually consider, Ms ethnic origins and, if they had done so, that they would have regarded them as irrelevant. However, they considered the criteria which Orthodox Judaism had applied for very many years and, although I entirely accept that they did so for religious reasons, I do not accept they were not considering Ms ethnic origins or making a decision on ethnic grounds. Such a view would be to take too narrow a view of the concept of ethnic origins or of the meaning of ethnic origin in sections 1(1)(a) and 3 of the 1976 Act. As I see it, once it is accepted (as Lord Brown does) that the reason M is not a member of the Jewish religion is that his forbears in the matrilineal line were not Orthodox Jews and that, in that sense his less favourable treatment is determined by his descent, it follows that he is discriminated against on ethnic grounds. It makes no difference whether the reason M is not acceptable is that neither his mother nor anyone in his matrilineal line was born Jewish or that his mother was not converted to Orthodox Judaism. The question is, in my opinion, not that espoused by Lord Rodger, but whether it is discrimination on ethnic grounds to discriminate against all those who are not descended from Jewish women. In my opinion it is. Lord Phillips, Lady Hale, Lord Mance and Lord Kerr have explained in detail why in their view the criteria were indeed discriminatory on ethnic and therefore racial grounds. I agree with their reasoning and do not wish further to add to it. In short, it is not in dispute that the decision in Ms case was taken on the basis of the criteria laid down by the OCR and followed by JFS. It follows that, if the criteria involved discrimination based on ethnic grounds, the decision was taken on a ground that was inherently racial and there was direct discrimination within section 1(1)(a) of the 1976 Act. If that is so, as I see it, the fact that the discrimination was also on religious grounds is irrelevant, as are both the fact that the religious grounds have been adopted for thousands of years and the fact that the Chief Rabbi and the OCR (and therefore JFS) concentrated wholly on the religious questions. In the Court of Appeal at para 30 Sedley LJ, with whom Smith LJ and Rimer LJ agreed, expressed the view that if that were not so, a person who honestly believed, as the Dutch Reformed Church of South Africa until recently believed, that God had made black people inferior and had destined them to live separately from whites, would be able to discriminate openly against them without breaking the law. I agree. It is to my mind no answer to say that the discrimination invited by the belief, on the grounds of colour, was overtly racist. It is true that such discrimination would be overtly on racial grounds but that is because the criteria were inherently based on racial grounds and not because of the subjective state of mind of the members of the Dutch Reformed Church or because of some principle of public policy. However, the 1976 Act banning direct discrimination is an application of public policy, rather like the decision of the of the United States Supreme Court in Bob Jones University v United States 461 US 574 (1983). I would however add that if, contrary to the views I have expressed, the state of mind of the Chief Rabbi and the OCR are relevant they must surely have subjectively intended to discriminate against applicants like M on the grounds set out in the criteria so that, again, if the criteria are based on ethnic grounds contrary to section 1(1)(a), they must surely have subjectively intended that result, however much the reason they did so was, as they saw it, religious. Finally, under the heading of direct discrimination, I would like to identify some of the aspects of the argument that I regard as irrelevant to the resolution of the single question whether the OCR criteria discriminate against applicants who do not meet the criteria on ethnic, and thus racial, grounds contrary to section 1(1)(a) of the 1976 Act. They include the following. i) It is suggested that the 1976 Act does not outlaw discrimination by an ethnic group against the same ethnic group. However, as I see it, the question is simply whether the discrimination is on ethnic grounds. The discrimination is not in dispute. I do not see that the identity of the discriminator is of any real relevance to the answer to the question. There is certainly nothing in the language or the context of section 1 of the Act or in its statutory purpose to limit the section in that way. ii) Like any statutory provision, the language of section 1(1)(a) should be construed in its context and having regard to its statutory purpose. Parliament decided to distinguish between direct and indirect discrimination. Adopting that approach, I am not persuaded that it is appropriate to construe section 1(1)(a) narrowly because it is not possible to justify the discrimination outlawed by it. Parliament could, like the European Convention on Human Rights, have permitted justification but, for policy reasons, chose not to. iii) For whatever reason, the question of construction of section 1(1)(a) has not arisen before. I do not, however, think that it can be relevant to that question that, if the respondents argument is correct, JFS has been acting unlawfully for more than thirty years. The question is the same now as it would have been if it had been raised thirty years ago. The provisions of the Equality Act 2006 are irrelevant for the same reasons. I accept that this case is curious in that both M and E are Masorti Jews who, like Orthodox Jews, recognise those whose mothers or others in the matrilineal line were Jews by descent or conversion. The real complaint is that the OCR does not accept conversion as practised by Masorti Jews because otherwise M would have qualified. I take Lord Browns point at para 248, (a) that E is not really seeking to prevent JFS from adopting oversubscription criteria which give priority to Jews but rather for JFS to define Jews more expansively than Orthodox Jews in fact do, and (b) that on the respondents argument it is strictly immaterial that E is Jewish or that Ms mother converted to Judaism, so that the policy could by struck down by anyone excluded by the application of the criteria. I recognise that there is an irony here but I do not see that that fact is relevant in answering the question posed by the statute, namely whether the discrimination is on ethnic grounds. I do not regard the consequences of the conclusion that the OCR criteria discriminate on ethnic grounds as relevant to the question whether they do or not. I am in any event not persuaded that they are anything like as serious as was suggested in argument. iv) v) It follows that I too would dismiss the appeal. Indirect discrimination Like Lord Kerr, I entirely agree with the reasoning and conclusion of Lord Mance on this issue, although if the appeal is dismissed on the direct discrimination issue, the issue of indirect discrimination does not arise. I agree with Lord Hopes reasoning and conclusions on costs. Postscript I wish to stress that nothing in the reasoning which has led me (or I believe others) to the conclusion that the criteria adopted by JFS discriminated against applicants on ethnic grounds is based on the view that the Chief Rabbi, the OCR or JFS acted in a racist way. In this regard I entirely agree with Lord Phillips and Lady Hale that any suggestion that they acted in a racist way in the popular sense of that term must be dismissed. Finally I direct the reader to the final paragraph in the judgment of Lord Kerr, at para 124 above, with which I am in complete agreement. The Minority Judgments LORD HOPE It has long been understood that it is not the business of the courts to intervene in matters of religion. In R v Chief Rabbi of the United Hebrew Congregations of Great Britain and the Commonwealth, ex p Wachmann [1992] 1 WLR 1036, 1042 1043, Simon Brown J observed that the court was hardly in a position to regulate what was essentially a religious function in that case, the determination whether someone was morally and religiously fit to carry out the spiritual and pastoral duties of his office. As he put it, the court must inevitably be wary of entering so self evidently sensitive an area, straying across the well recognised divide between church and state. This too is the approach of the legislature, as Hoffmann LJ said in R v Disciplinary Committee of the Jockey Club, ex p Aga Khan [1993] 1 WLR 909, 932: religion is something to be encouraged but it is not the business of government. It is just as well understood, however, that the divide is crossed when the parties to the dispute have deliberately left the sphere of matters spiritual over which the religious body has exclusive jurisdiction and engaged in matters that are regulated by the civil courts. In Percy v Board of National Mission of the Church of Scotland [2005] UKHL 73, [2006] 2 AC 28, for example, the appellant was employed by the Board of Mission under a contract personally to execute work within the meaning of section 82(1) of the Sex Discrimination Act 1975. The articles declaratory of the constitution of the Church of Scotland set forth in the Schedule to the Church of Scotland Act 1921 contain an assertion that the civil authority has no right of interference in the proceedings and judgments of the Church within the sphere of its spiritual government and jurisdiction. But it was held that by entering into a contract binding under the civil law the parties had put themselves within the jurisdiction of the civil courts and that the appellants claim of sex discrimination could not be regarded as a spiritual matter. The same approach to arguments based on religious doctrine has been adopted by the Supreme Court of Israel. In No'ar K'halacha v The Ministry of Education, HCJ 1067/08, 6 August 2009 the Court held that, although religious affiliation as a basis for treating students differently was recognised by Israeli law, it was not an absolute claim and could not prevail over the overarching right to equality. The school in question had established a two tier, ethnically segregated system by which students of Ashkenazi descent were automatically assigned to one group and those of Sephardi descent were assigned to another. Although this was purportedly on religious grounds, the thinly disguised subtext was that the Ashkenazi group were superior to the Sephardi and that, as they were the elite, their education should be organised accordingly. The Supreme Court rejected the schools argument that this was due to religious considerations, holding that they were a camouflage for discrimination cloaked in cultural disparity. It ordered the school to end all discriminatory practices against students who were of Sephardi ethnic origin. It is accepted on all sides in this case that it is entirely a matter for the Chief Rabbi to adjudicate on the principles of Orthodox Judaism. But the sphere within which those principles are being applied is that of an educational establishment whose activities are regulated by the law that the civil courts must administer. Underlying the case is a fundamental difference of opinion among members of the Jewish community about the propriety of the criteria that the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (the OCR) applies to determine whether a person is or is not Jewish. It is not for the court to adjudicate on the merits of that dispute. But the discrimination issue is an entirely different matter. However distasteful or offensive this may appear to be to some, it is an issue in an area regulated by a statute that must be faced up to. It must be resolved by applying the law laid down by Parliament according to the principles that have been developed by the civil courts. By far the most important issue in the appeals which are before this court is whether it is unlawful direct or indirect race discrimination for a faith school to adopt oversubscription criteria which give priority to children who are recognised by the OCR to be Jewish according to Orthodox Jewish principles. There is also an appeal by the United Synagogue in relation to a costs order made against it by the Court of Appeal, which I shall deal with briefly at the end of this opinion. Almost everything that I wish to say will be devoted to the main issue. I should make it clear at the outset that I agree with everything that Lord Rodger and Lord Brown say on the issue of direct discrimination. With much regret, I differ from them on the indirect discrimination issue. But I differ from them only when I reach the final step in that part of the argument. On both issues I agree entirely with Lord Walker. As for the facts, I have dealt with them more fully than would normally be appropriate in a minority judgment. I hope that, by doing so, I will have made it easier for all other members of the court to concentrate on the issues of law that arise in this case. The facts JFS, formerly the Jewish Free School, is a voluntary aided comprehensive secondary school which is maintained by the local authority, the London Borough of Brent. It has a long and distinguished history which can be traced back to 1732. It has over 2000 pupils, and for more than the past 10 years it has been over subscribed. It regularly has twice the number of applicants for the places that are available. Clause 8 of its Instrument of Government dated 18 October 2005 provides: Statement of School Ethos Recognising its historic foundation, JFS will preserve and develop its religious character in accordance with the principles of orthodox Judaism, under the guidance of the Chief Rabbi of the United Hebrew Congregations of the Commonwealth. The School aims to serve its community by providing education of the highest quality within the context of Jewish belief and practice. It encourages the understanding of the meaning of the significance of faith and promotes Jewish values for the experience of all its pupils. Further information is given by the school on its website, which states: The outlook and practice of the School is Orthodox. One of our aims is to ensure that Jewish values permeate the School. Our students reflect the very wide range of the religious spectrum of British Jewry. Whilst two thirds or more of our students have attended Jewish primary schools, a significant number of our Year 7 intake has not attended Jewish schools and some enter the School with little or no Jewish education. Many come from families who are totally committed to Judaism and Israel; others are unaware of Jewish belief and practice. We welcome this diversity and embrace the opportunity to have such a broad range of young people developing Jewish values together. The culture and ethos of the school is Orthodox Judaism. But there are many children at JFS whose families have no Jewish faith or practice at all. Prior to the decision of the Court of Appeal in this case the principal admissions criterion of JFS was that, unless undersubscribed, it would admit only children who were recognised as being Jewish by the OCR. Its policy for the year 2008/09, which can be taken to be the same as that for the year in question in this case, was as follows: It is JFS (the School) policy to admit up to the standard admissions number children who are recognised as being Jewish by the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (OCR) or who have already enrolled upon or who have undertaken, with the consent of their parents, to follow any course of conversion to Judaism under the approval of the OCR. The Chief Rabbi is the head of the largest groups of Orthodox synagogues in the United Kingdom. But he does not represent all Orthodox communities, nor does he represent the Masorti, Reform and Progressive Jewish communities. In accordance with Jewish law, the OCR recognises as Jewish any child who is descended from a Jewish mother. The mother herself must be descended from a Jewish mother or must have been converted to Judaism before the birth of the child in a manner recognised as valid by the OCR. Such a child is recognised by the OCR as Jewish regardless of the form of Judaism practised by the family (Orthodox, Masorti, Reform or Progressive). He is so recognised even if the entire family has no Jewish faith or observance at all. A family may be entirely secular in its life and outlook. Its members may be atheists or even be practising Christians or practising Muslims. Yet, if the child was himself born of a Jewish mother, he will be recognised as Jewish by the OCR and eligible for a place at JFS. These proceedings have been brought in relation to a child, M on the application of his father, E. Ms father is of Jewish ethnic origin. Ms mother is Italian by birth and ethnic origin. Before she married E she converted to Judaism under the auspices of a non Orthodox synagogue. Her conversion is recognised as valid by the Masorti, Reform and Progressive Synagogues. But it was undertaken in a manner that is not recognised by the OCR. She and E are now divorced and M lives mainly with his father. He and his father practise Judaism, and they are both members of the Masorti New London Synagogue. M practices his own Jewish faith, prays in Hebrew, attends synagogue and is a member of a Jewish Youth Group. But the OCR does not recognise him as of Jewish descent in the maternal line. His mother is not recognised as Jewish by the OCR and he has not undergone, or undertaken to follow, a course of approved Orthodox conversion. Consequently he was unable to meet the schools criterion for admission. In April 2007 he was refused a place at JFS for year 7 in the academic year 2007 2008. The effect of this decision on M and his family was profound and it was distressing. There was no other Jewish secondary school in London to which he could be admitted. So he was denied the opportunity of obtaining a Jewish secondary education in accordance with the familys religious beliefs and preference. On 15 April 2007 E notified JFSs Admission Appeals Panel that he wished to appeal. After a hearing on 5 June 2007, the Appeal Panel dismissed his appeal. In its decision letter of 11 June 2007 the Appeal Panel said that a challenge to the admissions criteria was outside its remit. On 2 July 2007 E referred his objection to the Schools Adjudicator, challenging JFSs admissions criteria for both under subscription and oversubscription. On 27 November 2007 the Schools Adjudicator upheld his complaint about the under subscriptions criteria, but he dismissed it in relation to the oversubscription criteria with which this case is concerned. E then raised proceedings for judicial review of JFSs decision to refuse M a place at the school and of the decision of the Appeal Panel to dismiss his appeal. In separate proceedings he sought judicial review of the decision of the Schools Adjudicator. On 3 July 2008 Munby J dismissed both claims for judicial review, except for Es claim that the Governing Body of JFS was in breach of its duty under section 71 of the Race Relations Act 1976 to have due regard to the need to eliminate racial discrimination and to promote equality of opportunity and good race relations: [2008] EWHC 1535 (Admin); [2008] ELR 445. He rejected Es argument that there had been direct discrimination on the grounds of race or ethnic origins, holding that it was based on religion: para 174. He also rejected his argument that there was indirect race discrimination, holding that, as JFS exists as a school for Orthodox Jews, its admissions policy of giving preference to children who were Jewish by reference to Orthodox Jewish principles was a proportionate means of achieving a legitimate aim within the meaning of section 1(1A)(c) of the 1976 Act: paras 201 202. He made a declaration to the effect that JFS was in breach of section 71. But in para 214 of his judgment he said that even the fullest and most conscientious compliance with that section would not have led to any difference in the crucial part of the admissions policy or its application in Ms case. On 25 June 2009 the Court of Appeal (Sedley, Smith and Rimer LJJ) allowed the appeal by E in both sets of proceedings: [2009] EWCA Civ 626; [2009] 4 ALL ER 375. Sedley LJ said that the courts essential difference with Munby J was that what he characterised as religious grounds were, in its judgment, racial grounds notwithstanding their theological motivation: para 48. As that observation indicates, the point at issue in this case is how the grounds are to be characterised. It is, in the end, a very narrow one. But it is by no means a simple one to resolve, as the division of opinion in this court indicates. The Race Relations Act 1976 Section 1 of the Race Relations Act 1976 defines race discrimination. It was amended by the Race Relations Act 1976 (Amendment) Regulations 2003 (SI 2003/1626) which, implementing Council Directive 2000/43 EC of 29 June 2000, rewrote in European terms the concept of indirect discrimination. So far as material it provides as follows: (1) A person discriminates against another in any circumstances relevant for the purposes of any provision of this Act if (a) on racial grounds he treats that other less favourably than he treats or would treat other persons (1A) A person also discriminates against another if, in any circumstances relevant for the purposes of any provision referred to in subsection (1B), he applies to that other a provision, criterion or practice which he applies or would apply equally to persons not of the same race or ethnic or national origins as that other, but (a) which puts or would put persons of the same race or ethnic or national origins as that other at a particular disadvantage when compared with other persons, (b) which puts or would put that other at that disadvantage, and (c) which he cannot show to be a proportionate means of achieving a legitimate aim. (1B) The provisions mentioned in subsection (1A) are (b) section 17; (c) section 19B Section 3 of the 1976 Act provides: (1) In this Act, unless the context otherwise requires racial grounds means any of the following grounds, namely colour, race, nationality or ethnic or national origins; racial group means a group of persons defined by reference to colour, race, nationality or ethnic or national origins, and references to a persons racial group refer to any racial group into which he falls. (2) The fact that a racial group comprises two or more distinct racial groups does not prevent it from constituting a particular racial group for the purposes of this Act. (4) A comparison of the case of a person of a particular racial group with that of a person not of that group under section 1(1) or (1A) must be such that the relevant circumstances in the one case are the same, or not materially different, in the other. Section 17 makes it unlawful for the governing body of a maintained school to discriminate against a person in the terms that it offers to admit him to the establishment as a pupil, or by refusing or deliberately omitting to accept an application for his admission to the establishment as a pupil. Section 19B(1) provides that it is unlawful for a public authority in carrying out any functions of the authority to do any act which constitutes discrimination. These provisions make it clear that the sphere within which the OCR was providing guidance to JFS was firmly within the jurisdiction of the civil courts. The admission arrangements The context in which JFSs admissions criteria must be examined is provided by statute. The functioning of publicly funded schools is governed by the School Standards and Framework Act 1998 (the 1998 Act). Schools maintained by local authorities are referred to as maintained schools. They include voluntary aided schools such as JFS: section 20(1)(c). Section 20(1) of the Education Act 2002 provides that for every maintained school there shall be an instrument of government which determines the constitution of the governing body and other matters relating to the school. Section 69 of the 1998 Act imposes duties in regard to the provision of religious education in community, foundation and voluntary schools. Section 69(3) provides that a foundation or voluntary school has a religious character if it is designated as a school having such a character by an order made by the Secretary of State. Section 69(4) requires such an order to state the religion or religious denomination in accordance with whose tenets religious education is, or may be, required to be provided at the school. Under the Religious Character of Schools (Designation Procedure) Regulations 1998 (SI 1998/2535) the Secretary of State is required to designate the religion or religious denomination he considers relevant, following consultation with the schools governing body. By the Designation of Schools Having a Religious Character (England) Order 1999 (SI 1999/2432) the Secretary of State designated JFS as having a religious character which is Jewish. Some other schools have been designated as Orthodox Jewish. By the Designation of Schools Having a Religious Character (Independent Schools) (England) (No 2) Order 2003 (SI 2003/3284) two schools were designated under this description. Part 2 of the Equality Act 2006 introduced a prohibition on discrimination on grounds of religion or belief in the provision of goods and services. Section 49 provides that it is unlawful for the responsible body of, among others, a school maintained by a local education authority to discriminate against any person by, among other things, refusing to accept an application to admit him as a pupil. Section 50 contains a list of exceptions to section 49, among which is one in favour of a school designated under 69(3) of the 1998 Act. As Munby J pointed out, this provision does no more than immunise the school from liability for religious discrimination under the 2006 Act: para 137. It does not immunise it from any liability for racial discrimination that it may have under the Race Relations Act 1976. Section 84 of the 1998 Act provides that the Secretary of State shall issue, and may from time to time revise, a code of practice for the discharge of their functions under Chapter 1 of Part III of the Act by, among others, the governing bodies of maintained schools and that the governing bodies must act in accordance with the code. Paragraphs 2.41 2.43 of the School Admissions Code for 2007 deals with faith based oversubscription criteria. Paragraph 2.41 states that schools designated by the Secretary of State as having a religious character (faith schools) are permitted by section 50 of the Equality Act 2006 to use faith based oversubscription criteria in order to give priority in admission to children who are members of, or who practise, their faith or denomination. It also states that faith based criteria must be framed so as not to conflict with other legislation such as equality and race relations legislation. Paragraph 2.43 of the 2007 Code states: It is primarily for the relevant faith provider group or religious authority to decide how membership or practice is to be demonstrated, and, accordingly, in determining faith based oversubscription criteria, admission authorities for faith schools should only use the methods and definitions agreed by their faith provider group or religious authority. Paragraph 2.47 states: Religious authorities may provide guidance for the admission authorities of schools of their faith that sets out what objective processes and criteria may be used to establish whether a child is a member of, or whether they practise, the faith. The admission authorities of faith schools that propose to give priority on the basis of membership or practice of their faith should have regard to such guidance, to the extent that the guidance is consistent with the mandatory provisions and guidelines of this Code. Section 88C(2) and (3) of the 1998 Act provides that Regulations may prescribe who should be consulted by the admission authority about admission arrangements. Regulation 12 of and Schedule 2 to the School Admissions (Admission Arrangements) (England) Regulations 2008 (SI 2008/3089) provide that the person that the governing body of JFS must consult about the admission arrangements for JFS for the academic year 2010 2011 is the Chief Rabbi. The regulations that were in force in 2007 when M was seeking admission to JFS were the Education (Determination of Admission Arrangements) Regulations 1999 (SI 1999/126) as amended which, by Regulation 5ZA and the Schedule, introduced provisions similar to those in the 2008 Regulations. The Chief Rabbi was the person to be consulted at the time when Ms application for admission was being considered. Provision has been made under section 88H (formerly section 90) of the 1998 Act for parents of a child of primary school age to refer an objection to a schools admission arrangements to the Schools Adjudicator. The procedure for determining admission arrangements is governed by section 88C of the 1998 Act, formerly (as regards England) section 89. It states that the admission arrangements are to be determined by the admission authority. For a voluntary aided school the governing body is the admission authority: see section 88(1). The governing body of JFS adopted an admissions policy which set out the schools over subscription criteria. The policy that was in force in 2007 stated: 1.1 It is JFS (the School) policy to admit up to the standard admissions number children who are recognised as being Jewish by the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (OCR) or who have already enrolled upon or who have undertaken, with the consent of their parents, to follow any course of conversion to Judaism under the approval of the OCR. 1.2 In the event that the School is oversubscribed then only children who satisfy the provisions of paragraph 1.1 above will be considered for admission, in accordance with the oversubscription criteria set out in Section 2 below. JFS cannot be criticised for basing its oversubscription criteria on the guidance that it received from the OCR. But this does not excuse it from liability for racial discrimination under the Race Relations Act 1976 if the guidance that it received was itself racially discriminatory. The OCR's guidance In connection with JFSs admissions for the year 2009 an application form, Application for Confirmation of Jewish Status, was issued by the OCR. Parents were required to select from the following options: (a) I confirm that the childs biological mother is Jewish by birth. (b) I confirm that the childs biological mother has converted to Judaism. (c) I confirm that the child is adopted [in which case the childs Jewish status must be separately verified]. The guidance notes to the application form state: Jewish status is not dependent on synagogue affiliation per se, though Jewish status will not be confirmed if the child, or any of his/her maternal antecedents, converted to Judaism under non orthodox auspices. If the childs parents were not married under orthodox auspices, further investigation will be necessary before confirmation of Jewish status is issued. This usually entails obtaining additional documentary evidence down the maternal line. If the childs mother was not herself born to a Jewish mother but converted to Judaism before the birth of the child, further inquiries are undertaken by the OCR before it is prepared to recognise the child as Jewish. The OCR does not recognise the validity of conversions carried out by non Orthodox authorities, as they do not require converts to subscribe fully to the tenets of Orthodox Judaism. The exacting process that is indicated by the wording of the application form is firmly rooted in Orthodox Jewish religious law. Religious status is not dependent on belief, religious practice or on attendance at a synagogue. It is entirely dependent upon descent or conversion. It depends on establishing that the person was born to a Jewish mother or has undergone a valid conversion to Judaism. That is a universal rule that applies throughout all Orthodox Judaism. Ms ineligibility for admission to JFS was due to the fact that different standards are applied by the Chief Rabbi from those applied by the Masorti, Reform and Progressive communities in the determining of a persons religious status. Nothing that I say in this opinion is to be taken as calling into question the right of the OCR to define Jewish identity in the way it does. I agree with Lord Brown that no court would ever dictate who, as a matter of Orthodox religious law, is to be regarded as Jewish. Nor is it in doubt that the OCRs guidance as to the effect of Orthodox Jewish religious law was given in the utmost good faith. The question that must now be faced is a different question. It is whether it discriminates on racial grounds against persons who are not recognised by the OCR as Jewish. The Jewish race and ethnicity It is common ground that for the purposes of the Race Relations Act 1976 Jews can be regarded as belonging to a group with common ethnic origins. As Lord Brown says (see paras [245] and [250]), it is possible (leaving aside those with no connection with Judiasm at all) to regard those who are being treated less favourably and those being treated more favourably by JFSs admissions policy as being all in the same ethnic group since they are all Jews. Lord Mance says (see paras 79, 80 and 86) that Orthodox Jews according to Orthodox Jewish principles and Jews who are not Orthodox should be regarded as forming separate ethnic groups or subgroups for present purposes. But the evidence in this case shows that it all depends on the context. Out on the shop floor, for example, all Jews are Jews and an employer who discriminates against them because they are Jews will be in breach of the Act. The problem in this case is that the Chief Rabbi does not recognise as a Jew anyone who is not a Jew according to Orthodox Jewish principles. So far as he is concerned and his concern is only with the Jewish religion there is no division of Jews into separate ethnic groups. I agree with Lord Brown that the difficulty in this case arises because of the overlap between the concepts of religious and racial discrimination and, in the case of Jews, the overlap between ethnic Jews and Jews recognised as members of the Jewish religion. The case does not fit easily into the legislative pattern. It was designed to deal with obvious cases of discrimination on racial grounds. Of course, as we are dealing in this case with faith schools, the religious test has come under scrutiny in the educational context. But the test that is employed is nevertheless a religious one, as that is what faith schools are expected to do. An approach to this case which assumes that Jews are being divided into separate subgroups on the grounds of ethnicity is an artificial construct which Jewish law, whether Orthodox or otherwise, does not recognise. The Act invites this approach, as it is clear that M was being treated less favourably than other persons and this raises the question whether this was on racial grounds. But it must be handled with very great care. As both Lord Phillips in para 9 and Lady Hale in para 54 have emphasised, no one in this case is suggesting that the policy that JFS has adopted is racist. The choice of words is important, and I too would wish to avoid that appalling accusation. The use of the word racial is inevitable, however, although the discrimination that is perceived in this case is on grounds of ethnicity. In DH v Czech Republic (2007) 47 EHRR 59, para 176, the European Court said: Discrimination on account of, inter alia, a persons ethnic origin is a form of racial discrimination. Racial discrimination is a particularly invidious kind of discrimination and, in view of its perilous consequences, requires from the authorities special vigilance and a vigorous reaction. It is for this reason that the authorities must use all available means to combat racism, thereby reinforcing democracys vision of a society in which diversity is not perceived as a threat but as a source of enrichment. One has to ask whether, on the facts of this case, we really are in that territory. The problem is that section 1(1) of the 1976 Act which prescribes direct discrimination does not distinguish between discrimination which is invidious and discrimination which is benign. A defence of justification is not available. In Mandla v Dowell Lee [1983] 2 AC 548 Lord Fraser of Tullybelton discussed the meaning of the word ethnic in the context of the refusal by a private school to admit a Sikh pupil whose religion and culture would not permit him to comply with the schools rules on uniform. At p 562 he said: For a group to constitute an ethnic group in the sense of the 1976 Act, it must, in my opinion, regard itself, and be regarded by others, as a distinct community by virtue of certain characteristics. Some of these characteristics are essential; others are not essential but one or more of them will commonly be found and will help to distinguish the group from the surrounding community. The conditions which appeared to him to be essential were (1) a long shared history, of which the group is conscious as distinguishing it from other groups, and the memory of which it keeps alive; (2) a cultural tradition of its own, including family and social customs and manners, often but not necessarily associated with religious observance. At p 564 he quoted with approval a passage from the judgment of Richardson J in King Ansell v Police [1979] 2 NZLR 531, 543, where he said: a group is identifiable in terms of its ethnic origins if it is a segment of the population distinguishable from others by a sufficient combination of shared customs, beliefs, traditions and characteristics derived from a common or presumed common past, even if not drawn from what in biological terms is a common racial stock. It is that combination which gives them an historically determined social identity in their own eyes and in the eyes of those outside the group. They have a distinct social identity based not simply on group cohesion and solidarity but also on their belief as to their historical antecedents. It is not disputed that the group or groups to which Jews belong are ethnic according to this analysis. They have a shared history which extends back for over three thousand years. Their traditions and practices are maintained with much devotion and attention to detail, in a manner that is designed to keep the memory of that shared history alive. Less favourable treatment of a person because he is, or is thought to be Jewish may therefore be regarded as discrimination against him on racial grounds: see, for example, Seide v Gillette Industries Ltd [1980] IRLR 427, paras 21 22, per Slynn J. In that case the Employment Appeal Tribunal upheld the tribunals decision that the anti semitic comments that were made by Mr Seides fellow worker were made because he was a member of the Jewish race, not because of his religion. The same would be true if he were to be discriminated against because he is, or is thought to be, of a particular Jewish ethnic origin. In Mandla v Dowell Lee at p 562 Lord Fraser said that the 1976 Act is not concerned at all with discrimination on religious grounds. But a finding that a person was treated less favourably on religious grounds does not exclude the possibility that he was treated in that way on racial grounds also. I agree with Lord Clarke that it would be wrong in principle to treat this as an either/or question. Direct discrimination At one level there is no dispute about the reason why M was denied admission to JFS. The schools admissions policy was based on the guidance which it received from the OCR. Thus far the mental processes of the alleged discriminator do not need to be examined to discover why he acted as he did. The dispute between the parties is essentially one of categorisation: was the OCRs guidance given on grounds of race, albeit for a religious reason, or was it solely on religious grounds? For JFS, Lord Pannick QC submits that M failed only because JFS was giving priority to members of the Jewish faith as defined by the religious authority of that faith, which was a religious criterion. That was the ground of the decision. The Court of Appeal was wrong to hold that the ground was that M was not regarded as of Jewish ethnic origin, and that the theological reasons for taking this view was the motive for adopting the criterion: para 29. For E, Ms Rose submits that Lord Pannicks submissions confused the ground for the decision with its motive. The ground spoke for itself. It was that M was not regarded according to Orthodox Jewish principles as Jewish. This meant that he was being discriminated against on grounds relating to his ethnicity. This was racial discrimination within the meaning of the statute. These contradictory assertions must now be resolved. I wish to stress again that the issue is not simply whether M is a member of a separate ethnic group from those who are advantaged by JFSs admissions policy. That is not where the argument in this case stops. I agree with Lord Rodger that the decision of the majority which, as it respectfully seems to me, does indeed stop there leads to extraordinary results. As he puts it in para 226, one cannot help feeling that something has gone wrong. Lord Brown makes the same point when, in para 247 he stresses the importance of not expanding the scope of direct discrimination and thereby placing preferential treatment which could be regarded as no more than indirectly discriminatory beyond the reach of possible justification. The crucial question is whether M was being treated differently on grounds of that ethnicity. The phrase racial grounds in section 1(1)(a) of the 1976 Act requires us to consider what those words really mean whether the grounds that are revealed by the facts of this case can properly be described as racial. Only if we are satisfied that this is so would it be right for this Court to hold that this was discrimination on racial grounds. The development of the case law in this area has not been entirely straightforward. The problem is that, in a new and difficult field, the need for the court to clarify one issue may result in a principle being stated too broadly. This may make it more difficult for it to resolve other different but interlocking issues when they arise at a later date. In Ealing London Borough Council v Race Relations Board [1972] AC 342 the House of Lords considered the phrase on the ground of colour, race or ethnic or national origins in section 1(1) of the Race Relations Act 1968 in the context of an application for housing by a Polish national It held (Lord Kilbrandon dissenting) that national origins meant something different from nationality and that it did not include it since, as Viscount Dilhorne put it at p 358, the word national in national origins means national in the sense of race and not citizenship. There was no discussion of the meaning of the word ethnic. Lady Hale has commented that Lord Simon of Glaisdales speech at p 364 is an interesting example of stereotyping which might raise judicial eyebrows today: The Judicial House of Lords (2009), p 578, fn 32. The House of Lords returned to this topic in Mandla v Dowell Lee [1983] 2 AC 548. By then nationality had been included in the definition of racial grounds in section 3(1) of the Race Relations Act 1976. There was still no statutory prohibition of discrimination on religious grounds. A Sikh schoolboy had been refused a place at a private school because he would not agree to cut his hair and stop wearing a turban. The question was whether this was discrimination on grounds of race as defined in section 3(1). The essential issue was how wide a meaning should be given to ethnic origins. Lord Fraser, with the agreement of the other members of the Appellate Committee, gave these words a wide meaning: see para 185, above. The next important case, which as this case shows may have sent the laws development off in the wrong direction, was R v Birmingham City Council, Ex p Equal Opportunities Commission [1989] AC 1155. The council had three grammar schools for girls and five grammar schools for boys. This was a historical fact, and it was not the councils policy to discriminate. But the House held that it was unlawful for it to provide fewer grammar school places for girls than for boys. The decision was plainly right. But the reasons given by Lord Goff of Chieveley, with whom the other members of the Appellate Committee agreed, have led to difficulty in other cases. At p 1194 he said: The intention or motive of the defendant to discriminate, though it may be relevant so far as remedies are concerned is not a necessary condition of liability; it is perfectly possible to envisage cases where the defendant had no such motive, and yet did in fact discriminate on the ground of sex. That decision was applied in James v Eastleigh Borough Council [1990] 2 AC 751. This was a case about a municipal swimming pool where there was free swimming for children under three years of age and for persons who had reached the state pension age, which was then 65 for men and 60 for women. Mr James and his wife, who were both aged 61, went swimming and he alone was charged a sum of money for doing so. He complained of sex discrimination. The House of Lords, by a majority of three to two, reversed the Court of Appeal and upheld his complaint. It held that the Court of Appeal had been wrong to treat this as a case of indirect discrimination since the councils policy was, as Lord Ackner put it at p 769, inherently discriminatory. Lord Goff in James deprecated the use, in the present context, of words such as intention, motive, reason and purpose: p 773. He added, at pp 773 774, that: taking the case of direct discrimination under section 1(1)(a) of the Act, I incline to the opinion that, if it were necessary to identify the requisite intention of the defendant, that intention is simply an intention to perform the relevant act of less favourable treatment. Whether or not the treatment is less favourable in the relevant sense, ie on the ground of sex, may derive either from the application of a gender based criterion to the complainant, or from selection by the defendant of the complainant because of his or her sex; but in either event, it is not saved from constituting unlawful discrimination by the fact that the defendant acted from a benign motive. More recent decisions of the House of Lords show, however, that where the facts are not so clear cut a more nuanced approach may be called for. The need to establish an objective link between the conduct of the alleged discriminator and the unequal treatment complained of does not exclude the need to explore why the alleged discriminator acted as he did. As the division of Jews into separate subgroups is in itself such an artificial concept (see paras 183 and 184 above), that seems to me to be the real issue in this case. In Nagarajan v London Regional Transport [2000] 1 AC 501, 510 511 Lord Nicholls of Birkenhead made an important statement of principle which has often been cited and applied: Thus, in every case it is necessary to inquire why the complainant received less favourable treatment. This is the crucial question. Was it on grounds of race? Or was it for some other reason, for instance, because the complainant was not so well qualified for the job? Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator. Treatment, favourable or unfavourable, is a consequence which follows from a decision. Direct evidence of a decision to discriminate on racial grounds will seldom be forthcoming. Usually the grounds of the decision will have to be deduced, or inferred, from the surrounding circumstances. Having thus identified the ground of the decision the reason why as the crucial question, he went on to deal with the question of motive: The crucial question just mentioned is to be distinguished sharply from a second and different question: if the discriminator treated the complainant less favourably on racial grounds, why did he do so? The latter question is strictly beside the point when deciding whether an act of racial discrimination occurred. For the purposes of direct discrimination under section 1(1)(a), as distinct from indirect discrimination under section 1(1)(b), the reason why the alleged discriminator acted on racial grounds is irrelevant. Racial discrimination is not negatived by the discriminators motive or intention or reason or purpose (the words are interchangeable in this context) in treating another person less favourably on racial grounds. In particular, if the reason why the alleged discriminator rejected the complainants job application was racial, it matters not that his intention may have been benign. As for Lord Goffs test in Birmingham, which Lord Bridge had described as objective and not subjective, Lord Nicholls said however that: He is not to be taken as saying that the discriminators state of mind is irrelevant when answering the crucial, anterior question: why did the complainant receive less favourable treatment? [my emphasis] Developing the same point in Chief Constable of West Yorkshire Police v Khan [2001] UKHL 48, 1 WLR 1947, para 29, Lord Nicholls said that the question was: [W]hy did the alleged discriminator act as he did? What, consciously or unconsciously, was his reason? Unlike causation, this is a subjective test. At p 512 in Nagarajan Lord Nicholls, considering the question of subconscious motivation, added these words: Many people are unable, or unwilling, to admit even to themselves that actions of theirs may be racially motivated. An employer may genuinely believe that the reason why he rejected an applicant had nothing to do with the applicants race. After careful and thorough investigation of a claim members of an employment tribunal may decide that the proper inference to be drawn from the evidence is that, whether the employer realised it at the time or not, race was the reason why he acted as he did. Conduct of this nature by an employer, when the inference is legitimately drawn, falls squarely within the language of section 1(1)(a). The employer treated the complainant less favourably on racial grounds. I would draw from this passage the proposition that if, after careful and thorough investigation, the tribunal were to conclude that the employers actions were not racially motivated that race was not the reason why he acted as he did it would be entitled to draw the inference that the complainant was not treated less favourably on racial grounds. The use of the words motivated and reason in the passage which I have just quoted appears at first sight not to be in harmony with the passage which I have quoted from p 511 where he said that racial discrimination is not negatived by the discriminators motive or intention or reason or purpose (the words are interchangeable in this context) in treating another person less favourably on racial grounds. But I do not think that, if these passages taken together are properly analysed, there is any inconsistency. The point that he was making on p 512 was that an examination of the employers motivation, or the reason why he acted as he did, may be highly relevant to a determination of the crucial question: was this discrimination on racial grounds. On the other hand, once that conclusion has been reached, the fact that there may have been a benign reason for the discrimination is beside the point. In other words, the statutory ground of discrimination, once it has been established, is unaffected by the underlying motive for it. This may be misguided benevolence as in James, or passive inertia as in Birmingham or racial hatred as in Seide. In the Birmingham case neither the reason nor the underlying motive left much room for argument. It was enough that the council was responsible for the continuation of the discriminatory system of grammar school education. In James there was a worthy underlying motive but, as the sole criterion that had been chosen was the unequal pension ages for men and women, the reason was clearly gender based. But where the complaint is that a black or female employee has not been selected for promotion, or has been taken off some particular duty, there will usually be a disputed issue as to the reason. This will require the tribunal to inquire more closely into the mind of the alleged discriminator. This is illustrated by Nagarajan and also by Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] UKHL 11, [2003] ICR 337. I would hold therefore that Lord Goffs rejection of a subjective approach was expressed too broadly. The proposition that the alleged discriminators motive, or reason, is irrelevant needs therefore to be reformulated. It all depends on the stage of the enquiry at which these words are being used. At the initial stage, when the question is whether or not this was discrimination on racial grounds, an examination of the alleged discriminators motivation may be not only relevant but also necessary, to reach an informed decision as to whether this was a case of racial discrimination. As the issue is a subjective one, his mental processes will, as Lord Nicholls said at p 511, call for some consideration. Everything that may have passed through his mind that bears on the decision, or on why he acted as he did, will be open to consideration. But once it has been determined that this was a case of racial discrimination, that is an end of the matter. The treatment cannot be excused by looking beyond it to why he decided to act in that way. I regret the fact that Lord Clarke does not agree with this analysis. As I understand his position, he prefers a test which makes the state of mind of the alleged discriminator irrelevant where the criteria he adopts are inherently discriminatory: see paras 127, 132. The question which divides us is whether his approach is supported by Lord Nicholls statements in Nagarajan and later in Khan. Lord Clarkes reading of the passage in Nagarajan which he has highlighted in para 139 of his opinion is that in the obvious cases, where discrimination is inherent, there is a prohibition on looking at the motivation of the alleged discriminator: see also his para 142. But Lord Nicholls does not say this. He makes no mention of any such prohibition. It may be that the tribunal will not need to look at the alleged discriminators mental processes in obvious cases, as his mental state is indeed obvious. But he does not say that the tribunal is precluded from doing so. Lord Steyn said in Nagarajan at pp 520H 521A that conscious motivation is not required. But, as he made clear, this does not mean that the alleged discriminators state of mind is always irrelevant. Confirmation that this is not Lord Nicholls approach is to be found in the last full paragraph on p 511 of Nagarajan, where he explains Lord Bridges description of the test which Lord Goff adopted in Birmingham. Lord Bridge described it as objective. But Lord Nicholls said that he is not to be taken as saying that there is no investigation into the mind of the alleged discriminator. He does not draw any distinctions here between cases like Birmingham and James, which Lord Clarke describes as cases of inherent discrimination (see para 142, above), and other types of cases. The point that he is making is that even in obvious cases such as Birmingham the tribunal is not precluded from looking at the state of mind of the discriminator. The passage from his speech in Khan to which I refer in para 193 supports this conclusion. He describes the test as a subjective one. Here again he does not distinguish between different types of cases. I believe therefore that an accurate reading of what Lord Nicholls actually said, and did not say, supports my analysis. There are few reported cases in which the tribunal has had to decide as between two prohibited reasons, such as race and gender or (since 2006) race and religion or belief. The only authority referred to by the parties was Seide v Gillette Industries Ltd [1980] IRLR 427. The appeal turned on the question of causation relating to the aftermath of a series of incidents of anti Semitic abuse of Mr Seide by a fellow worker. The report does not give any details of the content of the abuse. The only relevant passage in the judgment is at paras 21 22, recording that it was common ground that Jewish could refer to a member of an ethnic group or to a member of a religious faith, and that the tribunals decision, which it was entitled to reach on the facts, was that Mr Seide was subjected to anti Semitic abuse because of his Jewish origin. It is reasonable to infer that it would have been open to the members of the tribunal to conclude that the abuse was as much on the ground of ethnicity as on the ground of religion and that that was enough to constitute discrimination on a prohibited ground. This would be consistent with the principle that this is not an either/or question. As for this case, it is as different from Seide as it is possible to imagine. This was not a case of foul mouthed anti Semitic abuse. Those who are said to have been responsible for the discrimination, whether at the level of the school authorities, the OCR or the Chief Rabbi himself, are thoughtful, well intentioned and articulate. I would accept Lord Pannicks submission that the Chief Rabbi was not in the least interested in Ms ethnicity. The OCR has left us in no doubt as to why it was acting as it did. If the Chief Rabbi were to be asked the question that was framed by Lord Nicholls, he would say his reason was that this was what was required of him by fundamental Orthodox Jewish religious law. The question whether or not M was Jewish in the secular sense was of no interest to him at all. His advice was based simply and solely on his understanding of Jewish law. Jewishness based on matrilineal descent from Jewish ancestors has been the Orthodox religious rule for many thousands of years, subject only to the exception for conversion. To say that his ground was a racial one is to confuse the effect of the treatment with the ground itself. It does have the effect of putting M into an ethnic Jewish group which is different from that which the Chief Rabbi recognises as Jewish. So he has been discriminated against. But it is a complete misconception, in my opinion, to categorise the ground as a racial one. There is nothing in the way the OCR handled the case or its reasoning that justifies that conclusion. It might have been justified if there were reasons for doubting the Chief Rabbis frankness or his good faith. But no one has suggested that he did not mean what he said. As Lord Rodger points out, to reduce the religious element to the status of a mere motive is to misrepresent what he is doing. This case is quite different too from the example of the Dutch Reformed Church that was referred to by Sedley LJ in the Court of Appeal, para 30, and referred to again during the argument in this court. The discrimination that its belief invited, on grounds of colour, was overtly racist. A court would have no difficulty in dismissing the religious belief as providing no justification for it at all; see also Bob Jones University v United States, 461 US 574 (1983), where the US Supreme Court upheld the decision of the Inland Revenue Service to revoke the Universitys tax exempt status because, while permitting unmarried people who were black to enrol as students, it had adopted a racially discriminatory policy of denying admission to applicants engaged in an interracial marriage or known to advocate interracial marriage or dating although it had been based on sincerely held religious beliefs. Beliefs of that kind are not worthy of respect in a democratic society or compatible with human dignity: Campbell and Cosans v United Kingdom (1982) 4 EHRR 293, para 36. Here the discrimination between those who are, and those who are not, recognised as Jewish was firmly and inextricably rooted in Orthodox Jewish religious law which it is the duty of the Chief Rabbi to interpret and apply. The Chief Rabbis total concentration on the religious issue, to the exclusion of any consideration of ethnicity, can be illustrated by two contrasting examples. Several similar examples were referred to in the course of argument. A is the child of parents, and the grandchild of grandparents, all of whom led wholly secular lives similar to those of their largely secular neighbours. They never observed Jewish religious law or joined in the social or cultural life of the Jewish communities where they lived, but there is unimpeachable documentary evidence that more than a century ago the mother of As maternal grandmother was converted in an Orthodox synagogue. To the OCR A is Jewish, despite his complete lack of Jewish ethnicity. By contrast B is the child of parents, and the grandchild of grandparents, all of whom have faithfully observed Jewish religious practices and joined actively in the social and cultural life of the Jewish community, but there is unimpeachable documentary evidence that more than a century ago the mother of Bs maternal grandmother was converted in a non Orthodox synagogue. To the OCR B is not Jewish, despite his obvious Jewish ethnicity. Descent is only necessary because of the need, in these examples, to go back three generations. But having gone back three generations, the OCR applies a wholly religious test to what has been identified as the critical event. For the reasons given by Lord Rodger, the part that conversion plays in this process is crucial to a proper understanding of its true nature. It cannot be disregarded, as Lady Hale suggests in para 66, as making no difference. It shows that the inquiry is about a religious event to be decided according to religious law. For these reasons I would hold that the decision that was taken in Ms case was on religious grounds only. This was not a case of direct discrimination on racial grounds. On this issue, in respectful agreement with Lord Rodger, Lord Walker and Lord Brown, I would set aside the decision reached by the Court of Appeal. Indirect discrimination An examination of the question whether the application of the oversubscription policy to M amounted to indirect discrimination within the meaning of section 1(1A) of the Race Relations Act 1976 falls into two parts: (1) did the policy put persons of the same race or ethnic or national origins as M at a particular disadvantage when compared with other persons: section 1(1A)(a) and (b); and, if so, (2) can JFS show that the policy was a proportionate means of achieving a legitimate aim: section 1(1A)(c). Lord Pannick did not seek to argue that the first question should be answered in the negative. I think that he was right not to do so, as it is clear that M and all other children who are not of Jewish ethnic origin in the maternal line, together with those whose ethnic origin is entirely non Jewish, were placed at a disadvantage by the oversubscriptions policy when compared with those who are of Jewish ethnic origin in the maternal line. They may in theory gain entry to the school by undergoing a process of conversion that is approved by the OCR, but this in itself is a severe disadvantage. It appears that no child has ever been admitted to JFS on this basis. The issue on this branch of the case, therefore, is whether JFS can show that the policy had a legitimate aim and whether the way it was applied was a proportionate way of achieving it. The burden is on JFS to prove that this was so: R (Elias) v Secretary of State for Defence [2006] EWCA Civ 1293, [2006] 1 WLR 3213, per Mummery LJ at paras 131 132. The Court of Appeal accepted the submission that the admission criteria were explicitly related to ethnicity and so incapable of constituting or forming part of a legitimate aim and that it was not possible to justify indirect discrimination by reliance on the very thing that made the test discriminatory: para 45. But I think that is to misapply the test that the Act lays down. I agree with Lord Brown that there was a failure by the Court to address the questions of legitimate aim and proportionality on the assumption that the admissions policy was not directly discriminatory. For E, Ms Rose submitted that if the aim pursued was itself related to the ethnic origins of the pupils it was not capable of being a legitimate aim. This was how Lord Fraser put it in Mandla v Dowell Lee [1983] 2 AC 548, 566; see also Orphanos v Queen Mary College [1985] AC 761, 772. Those were indirect discrimination cases, but they were decided under section 1(1)(b) of the 1976 Act which has now been superseded by section 1(1A): see para [170], above. An aim which is itself discriminatory in character cannot be legitimate for the purposes of sections 1(1A). So the assumption on which the argument about indirect discrimination proceeds is that, for the reasons I have given, JFSs admission criteria did not discriminate on grounds of ethnicity. The question is whether, given that persons of given ethnic origins were at a particular disadvantage when compared with other persons, the school nevertheless had an aim which was legitimate. That is a different question. In the Administrative Court Munby J said that the aim was to educate those who, in the eyes of the OCR, are Jewish, irrespective of their religious beliefs, practices or observances, in a school whose culture and ethos is that of Orthodox Judaism: para 192. Developing this argument, Lord Pannick submitted that it was legitimate for a faith school to give preference to those children who are members of the faith as recognised by the OCR. If children in Ms position were admitted to the school there would inevitably be fewer places for those recognised as Jewish by the OCR. The policy of the government was to allow schools to give priority to those of the religion for which they have been designated. It was open to the school, under the 2007 Code, to adopt criteria based on membership or practice. As its ethos was that of Orthodox Judaism, which the Chief Rabbi seeks to promote, membership was a legitimate criterion. If that criterion was not adopted it would open the door to children who were not recognised as Jewish and virtually exclude those who were. As against this, Ms Rose submitted that it was impossible to ignore the close relationship between the criterion of membership and the ethnic origins of the children. This made it impossible for JFS to justify the criterion as legitimate. In my opinion, however, it is necessary to look at all the circumstances to test the issue of legitimacy. The assumption on which section 1(1A)(c) proceeds it that the treatment is open to the objection that it puts a person at a disadvantage in comparison with persons not of his race or ethnic or national origins. The question is whether treatment which has that effect can nevertheless be shown to have a legitimate aim. Questions about the motive and aims of the alleged discriminator come in at this stage. An aim may be held to be legitimate even though it discriminates in the ways referred to in section 1(1A)(a) and (b). In my opinion, for the reasons that Lord Brown gives in paras 252 253, JFS has shown that its aim is a legitimate one. The essential point is that a faith school is entitled to pursue a policy which promotes the religious principles that underpin its faith. It is entitled to formulate its oversubscriptions criteria to give preference to those children whose presence in the school will make it possible for it to pursue that policy. The legitimacy of the policy is reinforced by the statutory background. It has not emerged out of nowhere. It has been developed in accordance with the Code which permits faith schools to define their conditions for admission by reference either to membership of the faith or to practice. The justification for the Code lies exclusively in a belief that those who practise the faith or are members of it will best promote the religious ethos of the school. In Orphanos v Queen Mary College [1985] AC 761, 772 773 Lord Fraser said that a typical example of a requirement which could be justified without regard to the nationality or race of the person to whom it was applied was Panesar v Nestl Co Ltd (Note) [1980] ICR 144, where it was held that a rule forbidding the wearing of beards in the respondents chocolate factory was justifiable on hygienic grounds notwithstanding that the proportion of Sikhs who could conscientiously comply with it was considerably smaller than the proportion of non Sikhs who could comply with it. It was, he said, purely a matter of public health and nothing whatever to do with racial grounds. I would apply the same reasoning to this case. This leaves, however, the question of proportionality. The Court of Appeal, having concluded that the criterion did not have an aim that was legitimate, did not attempt to examine this issue: para 47. Before Munby J it was submitted by Ms Rose that JFSs admissions policy did not properly balance the impact of the policy on those like M adversely affected by it and the needs of the school: para 199. He rejected this argument for two reasons. One was that the kind of policy that is in question in this case is not materially different from that which gives preference in admission to a Muslim school to those who were born Muslim or preference in admission to a Catholic school to those who have been baptised. The other was that an alternative admissions policy based on such factors as adherence or commitment to Judaism would not be a means of achieving JFSs aims and objectives: paras 200 201. In my opinion these reasons miss the point to which Ms Roses submission was directed. The question is whether putting M at a disadvantage was a proportionate means of achieving the aim of the policy. It was for JFS to show that they had taken account of the effect of the policy on him and balanced its effects against what was needed to achieve the aim of the policy. As Peter Gibson LJ noted in Barry v Midland Bank plc [1999] ICR 319, 335 336 the means adopted must be appropriate and necessary to achieving the objective. I do not think that JFS have shown that this was so. Lord Pannick submitted that there was no other way of giving effect to the policy. If the school were to admit M, this would be to deny a place to a child who was regarded as Jewish by the OCR. This was inevitable as the school was oversubscribed. But what is missing is any sign that the schools governing body addressed their minds to the impact that applying the policy would have on M and comparing it with the impact on the school. As Ms Rose pointed out, the disparate impact of the policy on children in Ms position was very severe. They are wholly excluded from the very significant benefit of state funded education in accordance with their parents religious convictions, whereas there are alternatives for children recognised by the OCR although many in the advantaged group do not share the schools faith based reason for giving them priority. The school claimed to serve the whole community. But the way the policy was applied deprived members of the community such as M, who wished to develop his Jewish identity, of secondary Jewish education in the only school that is available. There is no evidence that the governing body gave thought to the question whether less discriminatory means could be adopted which would not undermine the religious ethos of the school. Consideration might have been given, for example, to the possibility of admitting children recognised as Jewish by any of the branches of Judaism, including those who were Masorti, Reform or Liberal. Consideration might have been given to the relative balance in composition of the schools intake from time to time between those recognised as Jewish by the OCR who were committed to the Jewish religion and those who were not, and as to whether in the light of it there was room for the admission of a limited number of those committed to the Jewish religion who were recognised as Jewish by one of the other branches. Ms Rose said that the adverse impact would be much less if a different criterion were to be adopted. But the same might be true if the criterion were to be applied less rigidly. There may perhaps be reasons, as Lord Brown indicates (see para 258), why solutions of that kind might give rise to difficulty. But, as JFS have not addressed them, it is not entitled to a finding that the means that it adopted were proportionate. There are cases, of which R(SB) v Governors of Denbigh High School [2006] UKHL 15, [2007] 1 AC 100 and Belfast City Council v Miss Behavin Ltd [2007] UKHL 19, [2007] 1 WLR 1420 are the best examples, where it can be said in the human rights context that the fact that the public authority had applied its mind to the issue is immaterial. This is because in that context the issue is one of substance, not procedure. Lord Hoffmann in Governors of Denbigh High School, para 68, gave this explanation: In domestic judicial review, the court is usually concerned with whether the decision maker reached his decision in the right way rather than whether he got what the court might think to be the right answer. But article 9 [of the European Convention on Human Rights] is concerned with substance, not procedure. It confers no right to have a decision made in any particular way. What matters is the result: was the right to manifest a religious belief restricted in a way which is not justified under article 9(2)? The problem that JFS faces in this case is a different one, as the context is different. Under section 1(1A)(c) of the Race Relations Act 1976 the onus is on it to show that the way the admissions policy was applied in Ms case was proportionate. It is not for the court to search for a justification for it: see Mummery LJs valuable and instructive judgment in R (Elias) v Secretary of State for Defence [2006] 1 WLR 3213, paras 131 133. JFS failed to discharge its duty under section 71 of the Act to have regard to the need to eliminate discrimination. It is having to justify something that it did not even consider required justification. The question, as to which there is no obvious answer either way, was simply not addressed. As a result the court does not have the statistical or other evidence that it would need to decide whether or not the application of the policy in Ms case was proportionate. It may well be, as Lord Brown indicates, that devising a new oversubscriptions policy that is consistent with the schools legitimate aim would be fraught with difficulty. But it was for JFS to explore this problem and, having done so, to demonstrate that whatever policy it came up with was proportionate. So, although I do not arrive at this conclusion by the same route as Lord Mance, I agree with him that on the material before the Court the admissions policy cannot be held to have been justified. I would hold that, by applying the oversubscription criteria to M in a way that put him at a particular disadvantage when compared with others not of the same ethnicity by reason of matrilineal descent, JFS discriminated against him in breach of section 1(1A) of the Race Relations Act 1976, and that E is entitled to a declaration to that effect. The appeals on costs In its order for costs the Court of Appeal directed that the United Synagogue and the Secretary of State must each pay 20% of Es costs in the Court of Appeal and below, and that the Schools Adjudicator must pay 10% of those costs. The United Synagogue and the Secretary of State have both appealed, the United Synagogue formally and the Secretary of State informally, against that order to this court. I did not understand Mr Linden QC, who appeared for the Secretary of State, to press his informal appeal and, as it has no merit, I would dismiss it. But Mr Jaffey for the United Synagogue did make submissions in support of its appeal. His point was that the United Synagogue had intervened in the Administrative Court on the express basis that it would not be found liable in costs which was not challenged by any other party, and that the basis for its intervention had been endorsed by Munby J when he allowed it to intervene. He submitted that his client ought not to have been found liable by the Court of Appeal for the costs incurred at first instance, nor should it have been found liable for costs in the Court of Appeal as there was no appeal against the basis on which it had been permitted to intervene. The situation is more complicated than that brief summary might suggest. The nature of the United Synagogues intervention was transformed when the case reached the Court of Appeal. Lord Pannick QC, who had not appeared below, was instructed on its behalf and assumed much responsibility for presenting the case on behalf of JFS so much so, that when the case reached this court, he appeared for JFS and not for the United Synagogue. In that situation, as it had assumed a role that went well beyond that of an intervener, the Court of Appeal cannot be faulted for finding it liable for a share of the costs in that court. But I do not think that what happened in the Court of Appeal should deprive the United Synagogue of the protection against an order for costs that it sought and was granted in the Administrative Court. So I would recall that part of the Court of Appeals order. I would replace it by a finding that the United Synagogue must pay 20% of Es costs in the Court of Appeal but not below, and that 20% of Es costs at first instance must be borne by JFS in addition to the 50% that it has already been ordered to pay. Conclusion I would allow the appeal by JFS against the Court of Appeals finding that the Chief Rabbis criteria discriminated directly against M on racial grounds. I would however dismiss its appeal against the Court of Appeals finding that this was a case of indirect discrimination, although on different grounds. I would allow the appeal by the United Synagogue against the Court of Appeals order for costs to the extent that I have indicated. I would dismiss the Secretary of States appeal. LORD RODGER The claimant, E, is Jewish by matrilineal descent. By conviction, he is a Masorti Jew. Masorti Judaism differs in certain respects from what is generally called Orthodox Judaism. Masorti Jews adhere to a set of beliefs and practices which have their origins in Orthodox Judaism but which are not now the same. In particular, while both Masorti and Orthodox Judaism believe that the written and oral Torah (from which the halakhah is derived) are unchangeable and bind Jews today, they differ in their interpretation of some parts of the halakah. Es wife converted to Judaism in an independent synagogue. At the risk of some slight imprecision, her conversion can be described as having taken place under non Orthodox auspices. Since the requirements for Orthodox conversion reflect Orthodox rather than Progressive or Masorti teachings and practices, her conversion is recognised by the Masorti authorities, but is not recognised by the Office of the (Orthodox) Chief Rabbi. Therefore, while the Masorti authorities recognise her son, M, as Jewish, the Office of the Chief Rabbi does not. But, of course, both E and M consider that M is Jewish, on the basis that his mother was Jewish when he was born. JFS is designated by the Secretary of State under the School Standards and Framework Act 1998 as having a Jewish religious character. The relevant regulations provide that the Schools governing body (the governors) must consult the Chief Rabbi about its admission arrangements. Having done so, the governors adopted an admissions policy which provided that, if the School were oversubscribed, then only children who were recognised as being Jewish by the Office of the Chief Rabbi would be considered for admission. E wanted to get M into the School. It has an excellent reputation and has been oversubscribed for many years. So, when E applied to have M admitted, hardly surprisingly, his application was rejected because the Office of the Chief Rabbi would not have recognised M as being Jewish. Indeed the point was so clear that E did not apply to the London Beth Din for a determination of Ms status in Orthodox Jewish law. In theory, the School would have considered admitting him if he had undertaken to convert under Orthodox auspices. But the process would have taken several years and have involved M adhering to a set of beliefs that are materially different from those of Masorti Judaism. E and M decided not to pursue that option. The purpose of designating schools as having a religious character is not, of course, to ensure that there will be a school where Jewish or Roman Catholic children, for example, can be segregated off to receive good teaching in French or physics. That would be religious discrimination of the worst kind which Parliament would not have authorised. Rather, the whole point of such schools is their religious character. So the whole point of designating the Jewish Free School as having a Jewish character is that it should provide general education within a Jewish religious framework. More particularly, the education is to be provided within an Orthodox religious framework. Hence the oversubscription admission criteria adopted after consulting the Chief Rabbi. The Schools policy is to give priority to children whom the Orthodox Chief Rabbi recognises as Jewish. From the standpoint of Orthodoxy, no other policy would make sense. This is because, in its eyes, irrespective of whether they adhere to Orthodox, Masorti, Progressive or Liberal Judaism, or are not in any way believing or observant, these are the children and the only children who are bound by the Jewish law and practices which, it is hoped, they will absorb at the School and then observe throughout their lives. Whether they will actually do so is, of course, a different matter. The dispute can be summarised in this way. E, who is himself a Masorti Jew, wants his son, whom he regards as Jewish, to be admitted to the School as a Jewish child. He complains because the School, whose admission criteria provide that only children recognised as Jewish by the Office of the (Orthodox) Chief Rabbi are to be considered for admission, will not consider admitting his son, who is recognised as Jewish by the Masorti authorities but not by the Chief Rabbi. If anything, this looks like a dispute between two rival religious authorities, the Office of the Chief Rabbi and the Masorti authorities, as to who is Jewish. But E claims and this Court will now declare that, when the governors refused to consider M for admission, they were actually treating him less favourably than they would have treated a child recognised as Jewish by the Office of the Chief Rabbi on racial grounds: Race Relations Act 1976, section 1(1)(a). The decision of the majority means that there can in future be no Jewish faith schools which give preference to children because they are Jewish according to Jewish religious law and belief. If the majority are right, expressions of sympathy for the governors of the School seem rather out of place since they are doing exactly what the Race Relations Act exists to forbid: they are refusing to admit children to their school on racial grounds. That is what the Courts decision means. And, if that decision is correct, why should Parliament amend the Race Relations Act to allow them to do so? Instead, Jewish schools will be forced to apply a concocted test for deciding who is to be admitted. That test might appeal to this secular court but it has no basis whatsoever in 3,500 years of Jewish law and teaching. The majoritys decision leads to such extraordinary results, and produces such manifest discrimination against Jewish schools in comparison with other faith schools, that one cant help feeling that something has gone wrong. The crux of the matter is whether, as the majority hold, the governors actually treated M less favourably on grounds of his ethnic origins. They say the governors did so, but for a bona fide religious motive. If that is really the position, then, as Lord Pannick QC was the first to accept on their behalf, what the governors did was unlawful and their bona fide religious motive could not make the slightest difference. But to reduce the religious element in the actions of those concerned to the status of a mere motive is to misrepresent what they were doing. The reality is that the Office of the Chief Rabbi, when deciding whether or not to confirm that someone is of Jewish status, gives its ruling on religious grounds. Similarly, so far as the oversubscription criteria are concerned, the governors consider or refuse to consider children for admission on the same religious grounds. The only question is whether, when they do so, they are ipso facto considering or refusing to consider children for admission on racial grounds. Lady Hale says that M was rejected because of his mothers ethnic origins which were Italian and Roman Catholic. I respectfully disagree. His mother could have been as Italian in origin as Sophia Loren and as Roman Catholic as the Pope for all that the governors cared: the only thing that mattered was that she had not converted to Judaism under Orthodox auspices. It was her resulting non Jewish religious status in the Chief Rabbis eyes, not the fact that her ethnic origins were Italian and Roman Catholic, which meant that M was not considered for admission. The governors automatically rejected M because he was descended from a woman whose religious status as a Jew was not recognised by the Orthodox Chief Rabbi; they did not reject him because he was descended from a woman whose ethnic origins were Italian and Roman Catholic. As in any complaint of racial discrimination, the point can be tested by reference to the appropriate comparator. The starting point is that both E and M believe M to be Jewish by descent. So E applied to the School to admit M on the basis that he was Jewish because his Italian Catholic mother had converted to Judaism before he was born. The mothers Jewish status as a result of her conversion was accordingly the only issue which the governors were asked to consider or did consider. They refused Es application because her conversion had been under non Orthodox auspices. Therefore the appropriate comparator is a boy with an Italian Catholic mother whom the governors would have considered for admission. He could only be a boy whose mother had converted under Orthodox auspices. The question then is: did the governors treat M, whose mother was an Italian Catholic who had converted under non Orthodox auspices, less favourably than they would have treated a boy, whose mother was an Italian Catholic who had converted under Orthodox auspices, on grounds of his ethnic origins? Plainly, the answer is: no. The ethnic origins of the two boys are exactly the same, but the stance of the governors varies, depending on the auspices under which the mothers conversion took place. Faced with a boy whose mother had converted under Orthodox auspices, the governors would have considered him for admission without pausing for a single second to enquire whether he or his mother came from Rome, Brooklyn, Siberia or Buenos Aires, whether she had once been a Roman Catholic or a Muslim, or whether he or she came from a close knit Jewish community or had chosen to assimilate and disappear into secular society. In other words, the ethnic origins of the child or his mother in the Mandla v Dowell Lee [1983] 2 AC 548 sense would not have played any part in the governors decision to admit him. All that would have mattered was that his mother had converted under Orthodox auspices. Equally, in Ms case, the governors did not refuse to consider admitting him on grounds of his Mandla ethnic origins. Even supposing that the governors knew about his origins, they were quite irrelevant and played no part in their decision. The governors were simply asked to consider admitting him as the son of a Jewish mother. They declined to do so because his mother had not converted under Orthodox auspices. It was her non Orthodox conversion that was crucial. In other words, the only ground for treating M less favourably than the comparator is the difference in their respective mothers conversions a religious, not a racial, ground. Since, therefore, when applying the religious test, the governors were not asked to consider, and did not actually consider, Ms ethnic origins, James v Eastleigh Borough Council [1990] 2 AC 751 and all the other cases to which the majority refer simply do not come into the picture. For these reasons, which are essentially those set out so clearly in the judgment of Munby J, and in agreement with the opinion of Lord Brown, I would hold that the governors did not discriminate against M directly on racial grounds. So far as indirect discrimination is concerned, again I agree with Lord Brown and indeed with Munby J. The aim of the School, to instil Jewish values into children who are Jewish in the eyes of Orthodoxy, is legitimate. And, from the standpoint of an Orthodox school, instilling Jewish values into children whom Orthodoxy does not regard as Jewish, at the expense of children whom Orthodoxy does regard as Jewish, would make no sense. That is plainly why the Schools oversubscription policy allows only for the admission of children recognised as Jewish by the Office of the Chief Rabbi. I cannot see how a court could hold that this policy is a disproportionate means of achieving the Schools legitimate aim. I would accordingly allow the Governing Bodys appeal and restore the order of Munby J. On the United Synagogues costs appeal, I agree with Lord Hope. LORD WALKER I respectfully agree with Lord Hope that this was a case of indirect, but not direct discrimination on grounds of ethnic origins contrary to section 1 of the Race Relations Act 1976 as amended. I do not wish to make any addition or qualification to the reasons set out in Lord Hopes judgment. But I do wish to express my respectful agreement with much of Lady Hales judgment, although we reach different conclusions. In particular I agree with her references to the conspicuously clear and thoughtful judgment of Mummery LJ in R (Elias) vs Secretary of State for Defence [2006] 1 WLR 3213. Lord Hope has rightly referred to Mummery LJs treatment (at paras 128 to 133, in the context of justification of indirect discrimination) of the significance of a failure to address the issue of potential discrimination, especially when section 71 of the Race Relations Act 1976 applies. But the whole of Mummery LJs discussion of the boundary between direct and indirect discrimination (paras 60 to 123) merits close attention. The division of opinion in this Court illustrates that the separateness and mutual exclusivity of direct and indirect discrimination, although immovably established as part of the law (for all the reasons given by Mummery LJ at paras 114 to 122), is sometimes elusive in practice. In consequence the sharp distinction between the impossibility of justifying direct discrimination in any circumstances, and the possibility of justifying indirect discrimination, sometimes seems a little arbitrary. LORD BROWN Jews of all denominations define membership of the Jewish religion by reference to descent or conversion. The question is one of status: you are a Jew if, whether by descent or conversion, your mother (or anyone else up the matrilineal line) was a Jew or if you yourself convert to Judaism. Orthodox Jews require that the conversion be recognised by the Office of the Chief Rabbi (OCR). Other denominations of Jewry (Masorti, Reform and Liberal) apply less exacting criteria for conversion. It is that which has given rise to the underlying dispute between the parties in this case. JFSs oversubscription admissions policy gives priority to those recognised by the OCR as Jewish. M, because his mother converted to Judaism under the auspices of a non Orthodox rabbi and not an orthodox rabbi, is not so recognised. There is much debate within the Jewish community about the proper standards to apply to conversion and many would like JFS to include within their admissions policy anyone recognised as Jewish by any of the denominations. Ms real complaint here is that in deciding who is a Jew the OCRs approach to conversion is misguided. That, however, is not an issue which is, or ever could be, before the Court. No court would ever intervene on such a question or dictate who, as a matter of orthodox religious law, is to be regarded as Jewish. Thus it is that this legal challenge has nothing to do with the standards of conversion to Judaism and who shall be recognised under religious law as Jews but instead, somewhat surprisingly at first blush, invites the Court to decide questions of racial discrimination. Is JFSs policy of giving priority in admissions to those recognised by the OCR as Jewish to be characterised and outlawed as direct racial discrimination contrary to section 1(1)(a) of the Race Relations Act 1976? Is the school on racial grounds (defined by section 3 of the Act to include the ground of ethnic origins) treating others less favourably? That is the central issue before the Court. Ms father (E), supported by the Equality and Human Rights Commission and the British Humanist Society, submits that those not recognised by JFS as Jews are being treated less favourably than those recognised as Jews (so much is obvious) on the ground of the ethnic origins of those not recognised i.e. because no one in their matrilineal line is recognised as Jewish. Integral to the argument is that any definition of Jewish status based on descent is necessarily dependent on ethnic origin and therefore to be regarded as racially discriminatory. In this case the argument arises in the context of an orthodox Jewish school and at the suit of a child who would be regarded as Jewish according to all other Jewish denominations. But the same argument could arise equally in the context of schools giving priority to children recognised as Jews by any other Jewish denomination. I repeat, all Jews define membership of their religion by reference to descent (or conversion). The contrary argument, advanced by JFS, United Synagogue, the Secretary of State for Children, Schools and Families, and the Board of Deputies of British Jews, is that those not recognised by the school as Jews are being treated less favourably not because of their ethnic origins a matter of total indifference to the OCR but rather because of their religion: they are not members of the Jewish religion whereas those preferred are. Of course, the reason they are not members of the Jewish religion is that their forebears in the matrilineal line (or, in the case of Liberal Jews, either ancestral line) were not Jews and in this sense their less favourable treatment is determined by their descent. The ground for their less favourable treatment, however, is religion, not race. Both arguments are to my mind entirely coherent and entirely respectable. Only one, however, can be correct. The difficulty in the case arises because of the obvious overlap here between the concepts respectively of religious and racial discrimination. If the ground for discrimination is racial, it is unlawful. If however the ground (and not merely the motive) is religious, that is lawful. The Equality Act 2006 for the first time outlawed religious discrimination inter alia with regard to school admissions but not in the case of oversubscribed designated faith schools like JFS. Plainly the 2006 Act cannot operate to legitimise what would otherwise be racial discrimination under the 1976 Act. One may note, however, that if Ms argument is correct, JFS (and all other Jewish schools, whether maintained or independent, whose admissions criteria similarly depend upon the child being recognised under religious law as Jewish) have been operating an unlawful directly racially discriminatory policy for upwards of 30 years. There can be no doubt that Jews, including those who have converted to Judaism, are an ethnic group. That, since the decision of the House of Lords in Mandla v Dowell Lee [1983] 2 AC 548, is indisputable. And it is plain too why the courts have given a wide definition to the phrase ethnic origins so as to provide comprehensive protection to those suffering discrimination on racial grounds. Manifestly Jews and those perceived by discriminators to be Jews have welcomed such an approach and benefit from it. It by no means follows, however, that to discriminate against a person on the ground that he or someone else either is or is not Jewish is therefore to discriminate against him on racial grounds (as the Court of Appeal concluded at paragraph 32 of its judgment). That to my mind is a considerable over simplification of an altogether more difficult problem. This is perhaps best illustrated by reference to Ms position relative to those benefited under JFSs admissions policy. True, M was refused admission because his mother, and therefore he himself, although plainly both ethnically Jewish in the Mandla sense, were not recognised by the OCR as Jewish. But those granted admission under the policy were admitted for the very reason that they were recognised as Jewish. Does the 1976 Act really outlaw discrimination in favour of the self same racial group as are said to be being discriminated against? I can find no suggestion of that in any of the many authorities put before us. Nor can I see a parallel between the present case and the example apparently thought indistinguishable by the Court of Appeal of the Dutch Reformed Church of South Africa who until recently honestly believed that God had made black people inferior and had destined them to live separately from whites. The discrimination there was plainly against blacks and in favour of whites self evidently, therefore, on the ground of race and irredeemable by reference to the Churchs underlying religious motive. Ethnic Jews and Jews recognised as members of the religion, distinguishable as groups though they are, clearly overlap. Not so blacks and whites. What I am suggesting here is that it is quite unrealistic, given that those being treated less favourably and those being treated more favourably by JFSs policy are all (save, of course, for those who have no connection with Judaism whatsoever) in the same ethnic group, to regard the policy as discriminatory on racial rather than religious grounds. I recognise, of course, that under section 3(2) of the 1976 Act a particular racial group within a wider racial group still enjoys protection under the Act. The point I am making, however, is that the differential treatment between Jews recognised by the OCR and those not so recognised within the wider group of ethnic Jews (no less obviously than the differential treatment between the former and those with no connection whatever to Judaism) is plainly on the ground of religion rather than race. Still less does it seem to me that this case is covered by the House of Lords decision in James v Eastleigh Borough Council [1990] 2 AC 751. Once it was recognised that the Council there might just as well have said that entry to its swimming pools was free to women, but not men, in the 60 65 age group, the direct discrimination against men became indisputable. The condition of pensionability was itself patently gender based. The position would surely have been different had the policy been instead to admit free, say, those who were in fact retired. That would not have involved direct discrimination and, if challenged as indirect discrimination, would surely have been capable of justification, certainly if free admittance was granted not only to those retired but also if the applicant could otherwise establish that he or she was of limited means. Mandatory retirement age and sex were there precisely coterminous. Even then, the case was decided only by the narrowest majority of the House overturning a unanimous Court of Appeal. The 1976 Act, unlike, for example, article 14 of the European Convention on Human Rights, draws a distinction between direct and indirect discrimination, only the latter being capable of justification. It therefore seems to me of the greatest importance not to expand the scope of direct discrimination and thereby place preferential treatment which could well be regarded as no more than indirectly discriminatory beyond the reach of possible justification. This is especially so where, as here, no one doubts the Chief Rabbis utmost good faith and that the manifest purpose of his policy is to give effect to the principles of Orthodox Judaism as universally recognised for millennia past. There is not the same exact correlation between membership of the Jewish religion and membership of the group regarded on the Mandla approach as being of Jewish ethnicity as there was between retirement age and sex in James v Eastleigh and I for my part would regard the Court of Appeals judgment as going further than that decision and as impermissibly expanding the scope of direct discrimination beyond its proper limits. As I have already indicated, E is not really seeking to prevent JFS from adopting oversubscription criteria which give priority to Jews but rather is asking for JFS to define Jews more expansively than Orthodox Jews in fact do. But it is, of course, the logic of his argument that JFSs policy must be regarded as racially discriminatory not merely because it rules out ethnic Jews like M who are not recognised as Jews by the OCR but also because it rules out all other racial groups whether or not they have any connection with Judaism at all. On this argument, it is strictly immaterial that E is Jewish or that Ms mother converted to Judaism. This policy could as well have been struck down at the suit of anyone desiring admission to the school. If the argument succeeds it follows that Jewish religious law as to who is a Jew (and as to what forms of conversion should be recognised) must henceforth be treated as irrelevant. Jewish schools in future, if oversubscribed, must decide on preference by reference only to outward manifestations of religious practice. The Court of Appeals judgment insists on a non Jewish definition of who is Jewish. Jewish schools, designated as such by the Minister and intended to foster a religion which for over 3000 years has defined membership largely by reference to descent, will be unable henceforth even to inquire whether one or both of the applicant childs parents are Jewish. (Yet is that so very different from a Catholic school asking if the child has been baptised? It is hardly likely to have been unless one at least of its parents was a Christian). The root question for the Court is simply this: can a Jewish faith school ever give preference to those who are members of the Jewish religion under Jewish law. I would answer: yes, it can. To hold the contrary would be to stigmatise Judaism as a directly racially discriminating religion. I would respectfully disagree with that conclusion. Indeed I would greatly regret it. On this issue of direct discrimination my views coincide entirely with those of Lord Rodger. I turn to the question of indirect discrimination. As already noted, it is obvious that JFSs policy involves those not recognised by the OCR as Jews being treated less favourably than those who are so recognised. It is rather less obvious, however, that this policy puts persons of the same race or ethnic or national origins as [M] at a particular disadvantage when compared with other persons and that it puts [M] at that disadvantage (section 1(1A)(a) and (b) of the 1976 Act). After all, as already observed, M is himself, although personally disadvantaged by the policy, a member of the very same ethnic group as the policy advantages. The view could, therefore, be taken that M is disadvantaged not by his ethnic origins but by his inability to satisfy the Orthodox religious test. Put that aside, however, and suppose that section 1(1A) is here engaged and that JFS must establish that its policy is a proportionate means of achieving a legitimate aim pursuant to section 1(1A)(c) as certainly they would need to do were this challenge brought, as theoretically it could have been, at the suit of a child in no way of Jewish ethnic origin. The legitimacy of JFSs aim is surely clear. Here is a designated faith school, understandably concerned to give preference to those children it recognises to be members of its religion, but so oversubscribed as to be unable to admit even all of these. The School Admissions Code expressly allows admission criteria based either on membership of a religion or on practice. JFS have chosen the former. Orthodox Jews regard education about the Jewish faith as a fundamental religious obligation. Unlike proselytising faiths, however, they believe that the duty to teach and learn applies only to members of the religion, because the obligations in question bind only them. JFSs purpose is to develop in those recognised by the OCR as Jewish an understanding and practice of the faith. The fact that many of those admitted do not practise the Jewish faith on their admission is intended and, indeed, welcomed. Such children are admitted and taught alongside children already committed to the Orthodox Jewish faith so as to enhance their level of religious knowledge and observance and in the hope and expectation that they may come to practise it. In short, to impose a religious practice test, besides being felt by many to be invasive, difficult to measure and open to abuse, would be contrary to the positive desire of schools like JFS to admit non observant as well as observant Jewish children. Ironically, moreover, to impose such a test would narrow, rather than widen, the character of the schools intake so as to make it appear more, rather than less, discriminatory. As the Court of Appeal itself noted (at para 44), those presently admitted come from a wide disparity of religious and cultural family backgrounds . even . from atheist or Catholic or Moslem families. Inevitably too, it would require the school to educate those not recognised as Jewish by Orthodox Jewish law at the expense of those who are. The Court of Appeals conclusion that the aim of JFSs admissions policy is illegitimate was based on its view that its purpose or inevitable effect is to make and enforce distinctions based on race or ethnicity (para 46), essentially a repetition of its earlier finding of direct race discrimination. In truth the Court of Appeal never addressed the questions of legitimate aim and proportionality on the assumption (the only basis on which indirect discrimination would fall to be considered) that the policy is not directly discriminatory. I turn finally, then, to the question of proportionality. Given JFSs legitimate aim of educating children recognised to be Jewish, is their policy of invariably giving preference to these children over those not so recognised a proportionate means of achieving that aim? Answering that question in the affirmative, Munby J, in the course of a lengthy, impressive and to my mind convincing judgment, said this: 200. Two quite separate considerations drive me to this conclusion. In the first place, the kind of admissions policy in question here is not, properly analysed, materially different from that which gives preference in admission to a Moslem school to those who were born Moslem or preference in admission to a Catholic school to those who have been baptised. But no one suggests that such policies, whatever their differential impact on different applicants, are other than a proportionate and lawful means of achieving a legitimate end. Why, [counsel] asks rhetorically, should it be any different in the case of Orthodox Jews? . I agree. Indeed, the point goes even wider than the two examples I have given for, as [counsel] submits, if Es case on this point is successful then it will probably render unlawful the admission arrangements in a very large number of faith schools of many different faiths and denominations. 201. The other point is that made both by the Schools Adjudicator and by [counsel for JFS]. Adopting some alternative admissions policy based on such factors as adherence or commitment to Judaism (even assuming that such a concept has any meaning for this purpose in Jewish religious law) would not be a means of achieving JFSs aims and objectives; on the contrary it would produce a different school ethos. If JFSs existing aims and objectives are legitimate, as they are, then a policy of giving preference to children who are Jewish applying Orthodox Jewish principles is, they say, necessary and proportionate indeed, as it seems to me, essential to achieve those aims . JFS exists as a school for Orthodox Jews. If it is to remain a school for Orthodox Jews it must retain its existing admissions policy; if it does not, it will cease to be a school for Orthodox Jews. Precisely. To this argument there is, and can be, no satisfactory answer. I find myself in full agreement with all of that. To ask why JFS should give preference to a Jewish child with little or no interest in Judaism whilst rejecting a committed child like M is to misunderstand the essential aim of an Orthodox Jewish school. This, as I have explained, is to fulfil its core religious duty: the education of members of its religion in the Orthodox faith, whether or not they practise it or will ever come to do so. It can no more be disproportionate to give priority to a Jewish child over that of a child, however sincere and committed, not recognised as Jewish than it would be to refuse to admit a boy to an oversubscribed all girls school. Whilst I respectfully agree with Lord Hopes judgment on the direct discrimination issue, I regretfully find myself differing from his conclusion on indirect discrimination. For my part I would have allowed JFSs appeal in its entirety. I understand Lord Hope to conclude that JFS have never addressed the question of proportionality and must now do so and devise a fresh policy allowing applications for admission by those not recognised as Jewish to be considered on an individual basis. Quite apart from the fact that this approach to my mind runs counter to the schools central aim, it seems to me fraught with difficulty. Quite how such a policy will be formulated and applied on a consistent basis is not easy to discern. That said, I regard it as altogether preferable to the new policy presently dictated by the Court of Appeals judgment: the imposition of a test for admission to an Orthodox Jewish school which is not Judaisms own test and which requires a focus (as Christianity does) on outward acts of religious practice and declarations of faith, ignoring whether the child is or is not Jewish as defined by Orthodox Jewish law. That outcome I could not contemplate with equanimity. JUDGMENT R (on the application of E) (Respondent) v Governing Body of JFS and the Admissions Appeal Panel of JFS (Appellants) and others R (on the application of E) (Respondent) v Governing Body of JFS and the Admissions Appeal Panel of JFS (United Synagogue) and others (Appellants) before LADY HALE LORD BROWN LORD HOPE, Deputy President JUDGMENT GIVEN ON 14th October 2009 Heard on 1st October 2009 Appellant (United Synagogue) Christopher McCrudden (Instructed by Farrer & Co) Ben Jaffey Appellant (Governing Body of JFS and Admissions) Lord Pannick QC Peter Oldham (Instructed by Stone King Sewell LLP) Appellant (Legal Services Commission) David Hart QC Sarah Lambert Commission) (Instructed by Legal Services Respondent (E) Dinah Rose QC Helen Mountfield (Instructed by Bindmans LLP) R (on the application of E) (Respondent) v Governing Body of JFS and the Admissions Appeal Panel of JFS (Appellants) and others R (on the application of E) (Respondent) v Governing Body of JFS and the Admissions Appeal Panel of JFS and others (United Synagogue) (Appellants) [2009] UKSC 1 LORD HOPE, DEPUTY PRESIDENT 1. This is a procedural application under rule 30 of the Supreme Court Rules 2009 (SI 2009/1603). The respondent (E) seeks an order that, whatever the outcome of the appeal, the appellants (JFS and the United Synagogue) shall not be entitled to seek the payment of any costs from himself or from the Legal Services Commission. Having heard argument at its first sitting on 1 October 2009, the Court decided to refuse Es application for a protective costs order for reasons to be given later. The following are our reasons for this decision. Background 2. JFS is a voluntary aided maintained comprehensive school in the London Borough of Brent. The first and second appellants are the Governing Body of JFS (the Governing Body) and its independent admission appeal panel (the Panel). The third appellant, the United Synagogue, is an association of Orthodox synagogues and the foundation body of JFS. E is the father of M, who is now aged 13. E is Jewish by descent and Ms mother, who is of Italian national and ethnic origin, has converted to Judaism. But her conversion is not recognised by the Orthodox Jewish community. M was refused admission to JFS for the year 2007/2008 on the grounds that he was not recognised as being Jewish by the Office of the Chief Rabbi of the United Hebrew Congregations of the Commonwealth and that its admission criteria gave priority, in the event of oversubscription, to Orthodox Jewish children. E sought judicial review of the Governing Bodys refusal to offer M a place at the school, of the Panels decision to uphold the refusal and against them both for failing to comply with the duty imposed on public authorities under section 71 of the Race Relations Act 1976 and against the rejection of his objection by the Schools Adjudicator. On 3 July 2008 Munby J found the school to have been in breach of its duty under section 71 of the 1976 Act, but otherwise rejected the claims: [2008] EWHC 1535/1536 (Admin). The finding of a breach of 3 section 71 was not the subject of any appeal, but Munby J granted leave to appeal on the substantive discrimination issues. 3. On 25 June 2009 the Court of Appeal allowed Es appeal, finding that JFSs oversubscription criteria were unlawful as they amounted to direct, or alternatively indirect, discrimination as defined in section 1 of the Race Relations Act 1976: [2009] EWCA Civ 626; [2009] PTSR 1442. The Governing Bodys refusal to admit M and the dismissal of his appeal by the Panel were both quashed. JFS was directed to reconsider Ms admission in accordance with its admissions policy but without regard to the criteria held by the judgment of the court to be unlawful. Other issues arising in the appeal were adjourned and have yet to be determined. That part of the order directing JFS to reconsider Ms admission was stayed for 14 days and, if a petition for leave to appeal were to be lodged, until the determination of that petition. As to costs, the Court of Appeal ordered that Es costs in that court and before Munby J be paid in the following proportions: 50% from JFS, 20% from the United Synagogue, which had participated in the case as an intervener in support of JFS, and as to the remaining 30% from other parties who are not concerned with this procedural application. Permission to appeal to the House of Lords was refused. 4. On 28 July 2008 an appeal committee of the House of Lords gave leave to the Governing Body and the Panel to appeal to the Supreme Court on the substantive discrimination issues and to the United Synagogue to appeal against the costs order that was made against it. On 31 July 2009 the House of Lords refused an application by the Governing Body and the Panel for a continuation of the stay of that part of the order of the Court of Appeal directing JFS to reconsider Ms admission, with the result that the decision originally challenged in this claim has effectively been superseded. 5. E has had the benefit in the proceedings below, and in the proceedings to date both in the House of Lords and this Court, of funding from the Legal Services Commission. He seeks the benefit of public funding for the substantive hearing of the appeal. But the Legal Services Commission was minded not to provide him with this benefit unless he takes steps to protect it against an order in the appellants favour for the costs of the appeal. On 18 September 2009 Mr David Reddin, a Senior Case Manager in the Legal Services Commission, wrote to his solicitors in these terms: I refer to your letter dated 15 September our telephone conversation of yesterday evening and your email of todays date. For the avoidance of doubt it is correct to say that I am minded to refuse your application for funding [E] as a respondent in the Supreme Court unless the other side is prepared to: 4 (a) Allow the cost [sic] order made in the Court of Appeal to stand in any event (b) Agree an undertaking that there will be no costs order in the Supreme Court with both sides bearing their own costs. If that is not acceptable we would expect an application to be made to the Court to seek an order along those lines failing which funding would not be provided. Our reasoning behind this decision stems from the Funding Code which in the circumstances of this case allows the refusal of funding unless the likely costs are proportionate to the likely benefits of proceedings having regard to the prospects of success and all other circumstances. 6. Mr Reddin then set out a series of factors which he said were clearly relevant to the determination of proportionality. In summary, they were as follows: (1) that E had effectively succeeded in the primary purpose of the litigation and his situation would not change whatever the outcome of the proceedings, (2) the likely consequences for the Community Legal Service Fund if costs were to be awarded to the other side on an inter partes basis in the Court of Appeal and in this Court, (3) that it was not unreasonable to expect the appellants to pay for the case, as the real interest in overturning the decision of the Court of Appeal lay with them and (4) that, although the case was of some public interest, the number of people who were likely to benefit as being in a similar position to M was relatively small. 7. The terms proposed by Mr Reddin on the Legal Services Commissions behalf were not acceptable to the other parties. E wishes to maintain his opposition to the appeals, but he is not in a position to fund the legal representation that he requires himself. The result of the predicament in which he finds himself is that he has been left with no alternative but to apply to the Court for a protective costs order. JFS and the United Synagogue have opposed his application. The issues 8. The order that E seeks is that the Appellants shall not be entitled to seek the payment of any costs from the Legal Services Commission or the Respondent. As Ms Dinah Rose QC in her carefully worded submissions 5 made clear, the real purpose of this application is to ensure that E continues to have the benefit of public funding in this Court. Taking her application at its face value, however, it raises the question whether E and the Legal Services Commission should be protected against orders for costs in three distinct respects: (1) an order in favour of JFS for the costs of its appeal to this Court on the discrimination issues; (2) an order in favour of the United Synagogue for the costs of its appeal on the costs issue; and (3) an order in favour of either or both of these parties for their costs in the Court of Appeal, should they be successful in their appeals to this Court. Mr Reddin also asked in his letter of 18 September 2009 that an order should be sought that both sides should bear their own costs in any event. But Ms Rose did not seek an order in these terms. She said that it would have serious implications for access to justice and that it would be wrong in principle. We will comment briefly below on her reasons for not doing so. 9. Mr Hart QC for the Legal Services Commission very properly conceded at the outset of his submissions that the Commission would not insist as a condition of extending funding to E on his obtaining protection against an order in favour of the United Synagogue for the costs of its appeal to this Court on the costs issue. Nor would it insist on his obtaining protection against an award in favour of JFS or the United Synagogue of their costs in the Court of Appeal in the event of either or both of them being successful in their appeals to this court. Had he not made these concessions we would have had no hesitation in refusing to make orders to either effect. In both cases Es exposure to the risk of these awards is a direct result of the fact that the Legal Services Commission provided funding to E in the Court of Appeal. Having decided to do so, it must be taken to have assumed the risk that any orders as to costs that were made in Es favour in that court would be reversed on appeal by the Supreme Court. E had a legitimate expectation that the funding that was afforded to him in the Court of Appeal would extend to the consequences of any such order. Furthermore, as Mr Jaffey for the United Synagogue pointed out, an order protecting E and the Legal Services Commission against the payment to the United Synagogue of any costs would render its appeal on the costs issue pointless. It does not appear from Mr Reddins letter of 18 September 2009 that he had applied his mind to the issue that the United Synagogue wishes to pursue. It is entirely separate from the discrimination issues raised by JFS. The costs issue raises no question of general public interest. A protective costs order in Es favour in regard to these costs would be entirely inappropriate. 10. The sole remaining issue relates to the costs that will be incurred by JFS in this court. The question is whether the Legal Services Commission is entitled to insist as a condition of extending funding to E to enable him to oppose JFSs appeal that he must obtain a protective order in his favour against these costs. Mr Hart confirmed that funding for this purpose would not be extended to E if an order was not made in his favour to this effect. He submitted that the relevant principles were identified by the Court of Appeal in 6 R (Corner House Research) v Secretary of State for Trade and Industry [2005] EWCA Civ 192, [2005] 1 WLR 2600, para 74, and that they applied by analogy to this case: (1) the issues raised by JFS are of general public importance, (2) the public interest requires that those issues should be resolved, (3) E does not have a private interest in the outcome, (4) having regard to the financial resources of the parties and to the amount of costs that are likely to be involved it is fair and just to make the order and (5) if the order is not made, E will probably discontinue the proceedings and will act reasonably in so doing. That was a case where the party who was seeking the order would discontinue the proceedings if it was not made. In this case, as in Weaver v London Quadrant Housing Trust [2009] EWCA Civ 235, it is the other party who is in control of the appeal. But it was held in Weaver that it was nevertheless appropriate for a protective costs order to be made in the respondents favour to ensure that there was proper representation for both sides before the court: para 7. 11. Funding services as part of the Community Legal Service is available only to individuals: Access to Justice Act 1999, s 7. So the principles that were identified in R (Corner House Research) v Secretary of State for Trade and Industry, where the claimant was a non governmental organisation of limited means and not eligible for public funding, do not provide a complete answer to the question which has been raised by this application. As in Weaver v London Quadrant Housing Trust, the prime mover behind the application in this case is the Legal Services Commission. It is not willing to fund Es legal representation except on its own terms. The question is whether the attitude which it has taken in this case is compatible with the scheme which has been laid down by the statute and in particular with the Code that has been prepared under section 8 of the 1999 Act. Ms Rose said that Mr Reddins letter was hard to reconcile with the Code. Lord Pannick QC for JFS, whose arguments Ms Rose said she was content to follow, went further. He submitted that in the circumstances of this case to withdraw public funding from E at this stage would be unlawful. The statutory framework 12. The basic rule that provides protection for individuals against an award of costs against them personally in cases that are publicly funded is set out in section 11(1) of the 1999 Act, which provides that, except in prescribed circumstances, costs ordered against an individual in relation to any proceedings funded for him shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances, including the financial resources of all the parties to the proceedings, and their conduct in connection with the dispute to which the proceedings relate. Section 11(3) provides that regulations may make provision about costs in relation to proceedings in which services are funded by the Legal Services Commission for any of the parties as part of the Community Legal Service. Section 11(4) 7 sets out various matters with regard to which such regulations may make provision. Regulation 5 of the Community Legal Service (Cost Protection) Regulations 2000 (SI 2000/824) provides cost protection for the Legal Services Commission in cases where funded services are provided to a client in relation to proceedings, those proceedings are finally decided in favour of a non funded party and the limit on costs set out in section 11(1) of the Act applies. In such cases the court may only make an order for payment by the Legal Services Commission to the non funded party of the whole or part of the costs incurred by him in the proceedings in an appellate court if it is satisfied that it is just and equitable in the circumstances that provision for the costs should be made out of public funds: regulation 5(3)(d). The Governing Body is a charity supported by limited funds. Lord Pannick said that the Legal Services Commission was, in effect, seeking to deny it the benefit of this regulation. Mr Hart did not suggest that anything else was to be found in the Community Legal Service (Cost Protection) Regulations 2000 that bears on the issue that has been raised in this case. 13. Section 8(1) of the 1999 Act provides that the Legal Services Commission shall prepare a code setting out the criteria according to which it is to decide whether to fund (or continue to fund) services as part of the Community Legal Service for an individual for whom they may be so funded and, if so, what services are to be funded for him. As E was funded in the courts below his case can be taken then to have met all the relevant criteria, including those relating to financial eligibility. Our attention was drawn to a number of provisions in the Funding Code which might be relevant to the consideration of his case at this stage, faced as he is with an appeal by a party who seeks to reverse orders that were made in his favour in the court below. Part A of the Code sets out the general criteria for funding. Section 7 of this Part sets out the criteria for judicial review. Para 7.5.2 provides: 7.5.2 The Presumption of Funding If the case has a significant wider public interest, is of overwhelming importance to the client or raises significant human rights issues, then, provided the standard criteria in Section 4 and Section 5.4 are satisfied, funding shall be granted save where, in light of information which was not before the court at the permission stage or has subsequently come to light, it appears unreasonable for Legal Representation to be granted. There has been no change to Es financial position or to the merits of the discrimination issues which are the subject of the appeal to this Court. The only change is that, as a result of the lifting of the stay, the decision originally challenged has been superseded. 8 14. Part C of the Funding Code provides guidance about decision making. Para 13.5 of this Part provides: 13.5 Discharge on the Merits 3. The importance of a case to the client must always be considered in decisions to discharge, especially if discharge is being considered at a very late stage in the proceedings. The clients rights under ECHR Article 6 must be considered in such circumstances. Para 13.7 provides: 13.7 Claims Not Subject to cost Benefit Ratios 1. This guidance applies to: . (c) certificates for Full Representation or Litigation Support in proceedings which have a significant wider public interest. 2. The starting point in deciding whether such a certificate should continue or should be discharged is to reapply the relevant Criteria for the Level of Service in question, taking into account the latest available information. 3. If, when prospects of success and cost benefit Criteria are applied to the certificate as interpreted in the way described above, those Criteria are satisfied, funding will continue and the certificate will not be discharged. If those Criteria are not satisfied, the certificate will normally be discharged, but the Commission will retain a discretion to continue funding. This discretion will generally be approached in the following way: (a) funding will be continued if there is a significant wider public interest in doing so (d) if proceedings are at a late stage the clients Article 6 rights must be considered. (e) otherwise the issue for the Commission is whether it is in the interests of the Community Legal Service Fund for funding to 9 continue. The certificate should be continued if it is in the Funds interest to do so, but discharged if it is not 15. The guidance that is given in Part C of the Funding Code appears to be directed primarily to the decisions that need to be taken at the outset of proceedings and about the discharge of certificates while proceedings are still at first instance. Mr Hart admitted that this was the first occasion that the Legal Services Commission had insisted upon a protective costs order as a condition of providing funding for an appeal against orders made in its clients favour by the court below for which the House of Lords had given leave. He was unable point to anything in the Code that provided direct support for the reasons that the Legal Services Commission has given in this case for refusing funding in these circumstances. So far as it goes, however, Part C of the Code suggests that the following considerations are relevant at this stage of the proceedings: (a) the Commission is entitled to consider whether it is in the interests of the Community Legal Service Fund for funding to be continued: para 13.7.3(e); but (b) where the case is of significant wider public interest, the presumption is that funding that has been granted under Part A, para 7.5.2 should continue: para 13.7.3(a); (c) the clients interests must also be considered: para 13.5.3; and (d) especially if proceedings are at a late stage, his Article 6 rights must be considered too: paras 13.5.3 and 13.7.3(d). Discussion 16. It is clear that E would not have made this application had he not been forced to do so by the Legal Services Commission. It is also clear that without the support of public funding he will not be able, as he wishes to do, to continue to resist this appeal. As in Weaver v London Quadrant Housing Trust [2009] EWCA Civ 235, it is essential that there should be representation for both sides before the Court. The case raises issues of considerable public importance, and it is plainly in the public interest that both sides of the argument should be properly presented. The date for the hearing of the appeal, which in view of the importance of the issues has been expedited, has already been fixed. The hearing is to take place at the end of this month. Time is now too short for effective alternative arrangements to be made for the Court to be provided with an amicus to argue the case in Es place. So the real issue that must be addressed is not whether the case is suitable for a protective costs order under the Corner House Research case principles, but whether the decision of the Legal Services Commission to refuse funding in this case unless it has the benefit of a protective costs order is compatible with the Funding Code and open to attack on traditional Wednesbury grounds. 17. The Legal Services Commission seeks protection from the ordinary consequences of the statutory scheme under which public funding is provided. It wishes to eliminate the risk of an order being made against it in favour of JFS under regulation 5(3)(d) of the 2000 Regulations. In Weaver v London 10 Quadrant Housing Trust [2009] EWCA Civ 235, where the applicant was publicly funded, an order was made that the Trust could not recover its costs against the applicant or the Legal Services Commission. That case shows that it cannot be said that an order in such terms will never be appropriate where the applicant is publicly funded. But, as Toulson LJ said in para 16, the background to the application in that case was highly unusual. The appeal had been brought by the Trust, which was a registered social landlord. It was brought to establish a point of general importance, namely whether a registered social landlord was to be regarded as a public authority for the purposes of section 6(3)(b) of the Human Rights Act 1998. The applicant no longer had any interest in the proceedings. The court had dismissed her challenge to the possession order that was made against her on the facts. So, as Elias LJ pointed out in para 12, the possession order against her would stand come what may. Any personal interest that she might derive and it hard to see what this could have been was no greater than that which would accrue to the benefit of all tenants in the same position that she had been before the order was made against her. 18. This case is significantly different, in various respects. In the first place, in Weaver it was inconceivable that, had the Legal Services Commission withdrawn their support and the Trust then succeed in their appeal, any costs order would have been made against the tenant. Here, by contrast, were his certificate to be discharged and the appeal to succeed, there is a real risk that E would be saddled with a very substantial liability for future costs. Furthermore, E maintains that he still has a personal interest in the outcome of this appeal. As he has made clear throughout, he feels strongly that other children should not be denied a school place on the same racially discriminatory basis as the Court of Appeal has held happened in Ms case. The private law claim by M on whose behalf the application for judicial review was brought is still unresolved, and its outcome is dependent upon the result of these proceedings. Moreover the public interest in the substantive discrimination issues which JFS wishes to argue is much greater than Mr Reddin appears to have envisaged. Far from the number of people who are likely to benefit as being in a similar position to M being relatively small, as he said in his letter of 18 September 2009, those who are likely to benefit extend across the widest possible spectrum of children who are exposed to discrimination on racial grounds. The issue is not confined to the Jewish community or even to children who wish to be educated in religious schools. So the case for insisting that JFS should be denied the benefit of regulation 5(3)(d) of the 2000 Regulations by the making of a protective costs order against it is much weaker than it was in Weavers case. 19. Then there is the stage at which this issue has been raised. Leave to appeal was given on 28 July 2009. On 31 July 2009 the House of Lords refused to make a protective costs order in Es favour. He was invited to renew his application if his financial circumstances changed so that his eligibility for 11 public funding came into question. There has been no change in his financial position or in the circumstances that affect the merits of the discrimination issues. All that has changed is the removal of the stay and Ms admission to the school. The prospects of success remain the same as they were in the courts below. It was in these circumstances that immediately after the hearing on 31 July 2009 Es solicitors contacted the Legal Services Commission about the funding for the appeal to this Court. Having attempted without success to obtain funding from another source, they made an application for further funding from the Legal Services Commission on 8 September 2009. Mr Reddins letter of 18 September 2009 was the result. 20. Mr Reddin cannot be criticised for delay. But his refusal to provide funding to enable E to resist JFSs appeal without a protective costs order ignores the consequences of that refusal for access to justice. As Ms Rose pointed out, it would mean that publicly funded litigants would have to be warned that they might be exposed to personal liability for the other sides costs on appeal even if they were entirely successful in the courts below. Many litigants would be unable to face that risk, with the result that they would be shut out of court. In consequence of JFSs appeal against the decision in his favour by the Court of Appeal, for which he was publicly funded, E would be exposed to the risk of having to pay costs incurred after public funding has been withdrawn from him even if he takes no further part in these proceedings. Conversely, the case has only reached this court because E had the benefit of public funding in the Court of Appeal. He had a legitimate expectation that, as he was provided with public funding in the Court of Appeal he would be provided with public funding to enable him to resist this appeal. 21. We take full account of the points made by Mr Reddin in his witness statement of 29 September 2009, and in particular the risk to the Legal Services Commission of an adverse costs order if JFS is successful in its appeal. We take account too of the fact that JFS would not be entitled to recover costs against an amicus were one to be appointed: see Weaver v London Quadrant Housing Trust [2009] EWCA Civ 235, para 7. But the position which Mr Reddin has adopted on the Commissions behalf cannot be reconciled with the statutory scheme. In his letter of 18 September 2009 he said that the Funding Code in the circumstances of this case allows the refusal of funding unless the likely costs are proportionate to the likely benefits of the proceedings and all other circumstances. This takes no account of the stage in the proceedings at which the client is in need of funding. Compelling reasons would have to be shown for withdrawing public funding from a litigant who was publicly funded in the court below, was successful in that court and wished to resist an appeal to a higher court by the unsuccessful party. No such reasons have been demonstrated in this case. 22. It should be understood, as a principle of general application, that if the Legal Services Commission decide to fund a litigant whether by way of claim 12 or a defence who is successful in his cause, that decision must ordinarily be seen to carry with it something close to an assurance that the Commission will continue to support him in any subsequent appeal by the unsuccessful party whilst he remains financially eligible. This will particularly be so where (a) the withdrawal of support would expose the publicly funded litigant to a substantial risk for future costs, (b) he retains a significant interest, quite apart from his interest in resisting any future costs liability, in maintaining his success in the litigation and (c) the issues raised on the appeal are of general public importance which it is in the public interest to resolve and his case on these issues is unlikely to be properly argued unless he continues to be funded by the Legal Services Commission. All three of these circumstances prevail in this case. It should be noted too that in Weaver the Court of Appeal, in making the protective costs order, expressly recognised that, were funding to be withdrawn, the necessary representation would have to be provided either by the Equality and Human Rights Commission or by appointing an amicus, against whom the Trust would not be able to recover its costs: [2009] EWCA Civ 235, paras 7 and 17. Those alternatives are not available here. Although the Equality and Human Rights Commission are intervening in the appeal, they propose to advance different arguments from those which E wishes to advance. As we have said, it is too late for the effective appointment of an amicus. The decision to refuse public funding at this stage appeared to us in all the circumstances to be so unreasonable as to be unlawful. 23. It was suggested that, if the Legal Services Commission adhered to this position despite a finding to that effect, the matter could be taken to judicial review. But time is short. No advantage is to be gained by going through that procedure, and the delay and expense of doing so is best avoided. We concluded that E is entitled to an immediate declaration in these proceedings that the only reasonable decision open to the Legal Services Commission is to continue to provide him with public funding for this appeal. No costs orders 24. As has already been noted, Ms Rose declined to seek an order that each side should be liable for its own costs in any event on the ground that to do so would be wrong in principle. As Scott Baker J observed in R (Boxall) v Waltham Forest London Borough Council (2001) 4 CCLR 258, para 12, the failure of a legally aided litigant to obtain a costs order against another party may have serious consequences. This is because, among other things, the level of remuneration for the lawyers is different between a legal aid and an inter partes determination of costs. This disadvantage is all the greater in a case such as this. It is a high costs case, for which lawyers representing publicly funded parties are required to enter a high costs case plan with the Legal Services Commission. It is a common feature of these plans that they limit the number of hours to an artificially low level and the rates at which solicitors and counsel are paid to rates that are markedly lower than those that are usual in the 13 public sector. Mr Reddin has indicated that, as they are defending a win, Es solicitors would not be expected to be paid at risk rates. Nevertheless the rate of remuneration that is likely to be agreed for this appeal will be considerably lower than that which would be reasonable if costs were to be determined inter partes. 25. It is one thing for solicitors who do a substantial amount of publicly funded work, and who have to fund the substantial overheads that sustaining a legal practice involves, to take the risk of being paid at lower rates if a publicly funded case turns out to be unsuccessful. It is quite another for them to be unable to recover remuneration at inter partes rates in the event that their case is successful. If that were to become the practice, their businesses would very soon become financially unsustainable. The system of public funding would be gravely disadvantaged in its turn, as it depends upon there being a pool of reputable solicitors who are willing to undertake this work. In R (Boxall) v Waltham Forest London Borough Council Scott Baker J said that the fact that the claimants were legally aided was immaterial when deciding what, if any, costs order to make between the parties in a case where they were successful and he declined to order that each side should bear its own costs. It is, of course, true that legally aided litigants should not be treated differently from those who are not. But the consequences for solicitors who do publicly funded work is a factor which must be taken into account. A court should be very slow to impose an order that each side must be liable for its own costs in a high costs case where either or both sides are publicly funded. Had such an order been asked for in this case we would have refused to make it. Conclusion 26. For these reasons we refused Es application for a protective costs order. We declared that the only reasonable decision open to the Legal Services Commission in the circumstances was to continue public funding without a protective costs order. The Legal Services Commission must pay to E, JFS and the United Synagogue the costs of this application. Nothing is to be published which may tend to identify the child who is concerned in these appeals. 14 On the United Synagogues costs appeal I agree entirely with Lord Hope. MICHAELMAS TERM [2009] UKSC 1 On appeal from: [2009] EWCA Civ 626 [2009] EWCA Civ 681

E challenged JFSs (formerly the Jews Free School) refusal to admit his son, M, to the school. JFS is designated as a Jewish faith school. It is over subscribed and has adopted as its oversubscription policy an approach of giving precedence in admission to those children recognised as Jewish by the Office of the Chief Rabbi of the United Hebrew Congregation of the Commonwealth (the OCR). The OCR only recognises a person as Jewish if: (i) that person is descended in the matrilineal line from a woman whom the OCR would recognise as Jewish; or (ii) he or she has undertaken a qualifying course of Orthodox conversion. E and M are both practising Masorti Jews. E is recognised as Jewish by the OCR but Ms mother is of Italian and Catholic origin and converted to Judaism under the auspices of a non Orthodox synagogue. Her conversion is not recognised by the OCR. Ms application for admission to JFS was therefore rejected as he did not satisfy the OCR requirement of matrilineal descent. E challenged the admissions policy of JFS as directly discriminating against M on grounds of his ethnic origins contrary to section 1(1)(a) of the Race Relations Act 1976 (the 1976 Act). Alternatively, E claimed that the policy was indirectly discriminatory. The High Court rejected both principal claims. The Court of Appeal unanimously reversed the High Court, holding that JFS directly discriminated against M on the ground of his ethnic origins. JFS appealed to the Supreme Court. The United Synagogue also appealed a costs order made against it by the Court of Appeal. The Supreme Court has dismissed the appeal by The Governing Body of JFS. On the direct discrimination issue, the decision was by a majority of five (Lord Phillips, Lady Hale, Lord Mance, Lord Kerr and Lord Clarke) to four (Lord Hope, Lord Rodger, Lord Walker and Lord Brown). The Majority held that JFS had directly discriminated against M on grounds of his ethnic origins. Lords Hope and Walker in the minority would have dismissed the appeal on the ground that JFS had indirectly discriminated against M as it had failed to demonstrate that its policy was proportionate. Lords Rodger and Brown would have allowed JFSs appeal in its entirety. The Supreme Court unanimously allowed in part the United Synagogues appeal on costs. The Majority Judgments The judgments of the Court should not be read as criticising the admissions policy of JFS on moral grounds or suggesting that any party to the case could be considered racist in the commonly understood, pejorative, sense. The simple legal question to be determined by the Court was whether in being denied admission to JFS, M was disadvantaged on grounds of his ethnic origins (or his lack thereof) (paras [9], [54], [124] and [156]). Direct Discrimination General Principles In determining whether there is direct discrimination on grounds of ethnic origins for the purposes of the 1976 Act, the court must determine, as a question of fact, whether the victims ethnic origins are the factual criterion that determined the decision made by the discriminator (paras [13], [16], [20] and [62]). If so, the motive for the discrimination and/or the reason why the discriminator considered the victims ethnic origins significant is irrelevant (paras [20], [22], [62] and [142]). Where the factual criteria upon which discriminatory treatment is based are unclear, unconscious or subject to dispute the court will consider the mental processes of the discriminator in order to infer as a question of fact from the available evidence whether there is discrimination on a prohibited ground (paras [21], [64], [115] and [133]). It is only necessary to consider the mental processes of the discriminator where the factual criteria underpinning the discrimination are unclear (para [114]). To treat an individual less favourably on the ground that he lacks certain prescribed ethnic origins constitutes direct discrimination. There is no logical distinction between such a case and less favourable treatment predicated upon the fact that an individual does possess certain ethnic origins (paras [9] and [68]). Direct discrimination does not require that the discriminator intends to behave in a discriminatory manner or that he realises that he is doing so (para [57]). There is no need for any consideration of mental processes in this case as the factual criterion that determined the refusal to admit M to JFS is clear: the fact that he is not descended in the matrilineal line from a woman recognised by the OCR as Jewish. The subjective state of mind of JFS, the OCR and/or the Chief Rabbi is therefore irrelevant (paras [23], [26], [65], [78], [127], [132], [136], [141] and [147] [148]). The crucial question to be determined is whether this requirement is properly characterised as referring to Ms ethnic origins (paras [27], [55] and [65]). Application in This Case The test applied by JFS focuses upon the ethnicity of the women from whom M is descended. Whether such women were themselves born as Jews or converted in a manner recognised by the OCR, the only basis upon which M would be deemed to satisfy the test for admission to JFS would be that he was descended in the matrilineal line from a woman recognised by the OCR as Jewish (para [41] per Lord Phillips). It must also be noted that while it is possible for women to convert to Judaism in a manner recognised by the OCR and thus confer Orthodox Jewish status upon their offspring, the requirement of undergoing such conversion itself constitutes a significant and onerous burden that is not applicable to those born with the requisite ethnic origins this further illustrates the essentially ethnic nature of the OCRs test (para [42] per Lord Phillips). The test of matrilineal descent adopted by JFS and the OCR is one of ethnic origins. To discriminate against a person on this basis is contrary to the 1976 Act (para [46] per Lord Phillips). The reason that M was denied admission to JFS was because of his mothers ethnic origins, which were not halachically Jewish. She was not descended in the matrilineal line from the original Jewish people. There can be no doubt that the Jewish people are an ethnic group within the meaning of the 1976 Act. While JFS and the OCR would have overlooked this fact if Ms mother had herself undergone an approved course of Orthodox conversion, this could not alter the fundamental nature of the test being applied. If Ms mother herself was of the requisite ethnic origins in her matrilineal line no conversion requirement would be imposed. It could not be said that M was adversely treated because of his religious beliefs. JFS and the OCR were indifferent to these and focussed solely upon whether M satisfied the test of matrilineal descent (paras [66] and [67] per Lady Hale). Direct discrimination on grounds of ethnic origins under the 1976 Act does not only encompass adverse treatment based upon membership of an ethnic group defined in the terms elucidated by the House of Lords in Mandla v Dowell Lee [1983] 2 AC 548. The 1976 Act also prohibits discrimination by reference to ethnic origins in a narrower sense, where reference is made to a persons lineage or descent (paras [80] [84] per Lord Mance). The test applied by JFS and the OCR focuses on genealogical descent from a particular people, enlarged from time to time by the assimilation of converts. Such a test is one that is based upon ethnic origins (para [86] per Lord Mance). This conclusion is buttressed by the underlying policy of the 1976 Act, which is that people must be treated as individuals and not be assumed to be like other members of a group: treating an individual less favourably because of his ancestry ignores his unique characteristics and attributes and fails to respect his autonomy and individuality. The UN Convention on the Rights of the Child requires that in cases involving children the best interests of the child are the primary consideration (para [90] per Lord Mance). The reason for the refusal to admit M to JFS was his lack of the requisite ethnic origins: the absence of a matrilineal connection to Orthodox Judaism (para [112] per Lord Kerr). Ms ethnic origins encompass, amongst other things, his paternal Jewish lineage and his descent from an Italian Roman Catholic mother. In denying M admission on the basis that he lacks a matrilineal Orthodox Jewish antecedent, JFS discriminated against him on grounds of his ethnic origins (paras [121] [122] per Lord Kerr). It might be said that the policy adopted by JFS and the OCR was based on both ethnic grounds and grounds of religion, in that the reason for the application of a test based upon ethnic origins was the conviction that such a criterion was dictated by Jewish religious law. The fact that the rule adopted was of a religious character cannot obscure or alter the fact that the content of the rule itself applies a test of ethnicity (paras [129] [131] per Lord Clarke). The fact that a decision to discriminate on racial grounds is based upon a devout, venerable and sincerely held religious belief or conviction cannot inoculate or excuse such conduct from liability under the 1976 Act (paras [35], [92], [113] and [119] [120]). Further Comments It is not clear that the practice based test adopted by JFS following the Court of Appeals judgment will result in JFS being required to admit children who are not regarded by Jewish by one or more of the established Jewish movements (para [50] per Lord Phillips). It may be arguable that an explicit exemption should be provided from the provisions of the 1976 Act in order to allow Jewish faith schools to grant priority in admissions on the basis of matrilineal descent; if so, formulating such an exemption is unquestionably a matter for Parliament (paras [69] [70] per Lady Hale). Indirect Discrimination As the case is one of impermissible direct discrimination it is unnecessary to address the claim of indirect discrimination (para [51] per Lord Phillips). Direct and indirect discrimination are mutually exclusive; both concepts cannot apply to a single case concurrently. As this case is one of direct discrimination it could not be one of indirect discrimination (para [57] per Lady Hale). Ex hypothesi, if the case was not direct discrimination, then the policy was indirectly discriminatory (para [103]). The policy pursued the legitimate aim of effectuating the obligation imposed by Jewish religious law to educate those regarded by the OCR as Jewish (paras [95] [96]). However, JFS had not, and on the basis of the evidence before the court could not, demonstrate that the measures it adopted, given the gravity of their adverse effect upon individuals such as M, were a proportionate means of pursuing this aim (paras [100] [103], [123] and [154]). The Minority Judgments Direct Discrimination In identifying the ground on which JFS refused to admit M to the school the Court should adopt a subjective approach which takes account of the motive and intention of JFS, the OCR and the Chief Rabbi (para [195] [197] per Lord Hope). In the instant case JFS, the OCR and the Chief Rabbi were subjectively concerned solely with Ms religious status, as determined by Jewish religious law. There is no cause to doubt the Chief Rabbis frankness or good faith on this matter (para [201] per Lord Hope). The availability of conversion demonstrates that the test applied is inherently of a religious rather than racial character (para [203] per Lord Hope). It is inapt to describe the religious dimension of the test being applied by JFS as a mere motive (paras [201] per Lord Hope; [227] per Lord Rodger). The appropriate comparator for M in this case is a child whose mother had converted under Orthodox Jewish auspices. The ground of difference in treatment between M and such a child would be that the latters mother had completed an approved course of Orthodox conversion (paras [229] [230] per Lord Rodger). Indirect Discrimination Lords Hope and Walker Clearly, children who were not of Jewish ethnic origin in the matrilineal line were placed at a disadvantage by JFSs admission policy relative to those who did possess the requisite ethnic origins (para [205]). JFSs policy pursued the legitimate aim of educating those regarded as Jewish by the OCR within an educational environment espousing and practising the tenets of Orthodox Judaism (para [209]). The 1976 Act placed the onus on JFS to demonstrate that in formulating its policy it had carefully considered the adverse effect of its policy on M and other children in his position and balanced this against what was required to give effect to the legitimate aim which it sought to further (para [210]). There is no evidence that JFS considered whether less discriminatory means might be adopted which would not undermine its religious ethos: the failure to consider alternate, potentially less discriminatory, admission policies means that JFS is not entitled to a finding that the means which it has employed are proportionate (paras [212] and [214]). Lords Rodger and Brown The objective pursued by JFSs admission policy educating those children recognised by the OCR as Jewish was irreconcilable with any approach that would give precedence to children not recognised as Jewish by the OCR in preference to children who were so recognised. JFSs policy was therefore a rational way of giving effect to the legitimate aim pursued and could not be said to be disproportionate. (para [233] per Lord Rodger; para [256] per Lord Brown). The United Synagogue Costs Appeal The United Synagogue must pay 20 per cent. of Es costs from the Court of Appeal but not those incurred in the High Court. The 20 per cent. of Es costs in the High Court previously allocated to the United Synagogue must be borne by JFS in addition to the 50 per cent. that it has already been ordered to pay (para [217]).

longest

It is the role of the common law to adapt to meet new circumstances and challenges. Mesothelioma has been and is a tragedy for individuals and families. It is caused by exposure to the inhalation of asbestos dust, and has a gestation period measured typically in decades. The more fibres inhaled, the greater the risk of contracting mesothelioma. But, beyond that, its specific causation is highly uncertain: see Sienkiewicz v Greif (UK) Ltd [2011] UKSC 10, [2011] 2 AC 229, para 19, Durham v BAI (Run off) Ltd [2012] UKSC 14, [2012] 1 WLR 867, para 6. It was thought it might be caused by a single fibre, but Lord Phillips annex to his judgment in Sienkiewicz, part A, paras 10 11, notes that the process of causation may involve (different) fibres acting in a way which gives rise to a series of as many as six or seven genetic alterations, ending with a malignant cell in the pleura. In any event, the evidential uncertainties about its causation led the House of Lords in Fairchild v Glenhaven Funeral Services Ltd [2002] UKHL 22, [2003] 1 AC 32 to create a special common law rule, operating within what may be called the Fairchild enclave, to govern liability between victims and those who in breach of duty had exposed them to asbestos dust. Following the Houses decision in Barker v Corus UK Ltd [2006] UKHL 20, [2006] 2 AC 572, this special rule was fortified by the Compensation Act 2006. Unsurprisingly, the courts are still working out the implications. Courts which have embarked on it have had to focus on disputes gradually shifting from (a) the position between victims and those responsible for their exposure, on which substantial authority now exists under English law, to (b) the position between persons so responsible and their insurers. This appeal and the conclusions I reach on it are concerned exclusively with situations falling within the special rule. The appeal, brought by Zurich Insurance plc (Zurich) as appellant against International Energy Group Ltd (IEG) as respondent, raises points under both (a) and (b). The issues under (a) are subject to Guernsey law, and there is a difference between the English and Guernsey statute law. The parties are however agreed that Guernsey common law is to be treated as identical with English common law on this appeal. According to the special rule recognised by the House of Lords, a person contracting mesothelioma, after being exposed to significant quantities of asbestos dust originating from different sources over the same or different periods, can sue any person who was (negligently or in breach of duty) responsible for any such source of exposure, although unable to show which exposure in probability actually led or contributed to the disease: Fairchild and Barker. This rule applies even if the only potential sources consist in the ambient environmental exposure which the population generally experiences and some other negligently created source which only increases this ambient exposure by a small percentage 18% in the case so holding: Sienkiewicz. The special rule confers a right of suit on victims of mesothelioma by reference to each significant exposure, rather than any probability that the particular exposure relied upon led or contributed to the disease. As formulated in Fairchild, it left open the damages recoverable from a person responsible for an exposure. In Barker the House of Lords held that a person responsible was liable not for the whole damages attributable to the mesothelioma, but only in proportion to his own contribution to the overall exposure, probably measured by the duration and intensity of the particular exposure for which he was responsible. This proportionate recovery applied whether the other sources were tortious, non tortious, by natural causes or by the victim him or herself. The United Kingdom Parliament reacted immediately, reversing the Houses ruling that recovery should be proportionate by the Compensation Act 2006. This Act preserves all other aspects of the special rule, as is apparent from section 3(1) and (2): Mesothelioma: damages (1) This section applies where (a) a person (the responsible person) has negligently or in breach of statutory duty caused or permitted another person (the victim) to be exposed to asbestos, (b) the victim has contracted mesothelioma as a result of exposure to asbestos, (c) because of the nature of mesothelioma and the state of medical science, it is not possible to determine with certainty whether it was the exposure mentioned in paragraph (a) or another exposure which caused the victim to become ill, and (d) the responsible person is liable in tort, by virtue of the exposure mentioned in paragraph (a), in connection with damage caused to the victim by the disease (whether by reason of having materially increased a risk or for any other reason). (2) The responsible person shall be liable (a) in respect of the whole of the damage caused to the victim by the disease (irrespective of whether the victim was also exposed to asbestos (i) other than by the responsible person, whether or not in circumstances in which another person has liability in tort, or (ii) by the responsible person in circumstances in which he has no liability in tort), and (b) jointly and severally with any other responsible person. Industry guidelines for apportioning and handling employers liability mesothelioma claims were developed in October 2003, taking account of the Financial Services Compensation Scheme (FSCS) available under the Policyholders Protection Act 1975 and the Financial Services and Markets Act 2000 in relation to insolvent insurers. These guidelines were also reflected in the Industrial Disease Claims Working Party handling guidelines issued in 2006, which were themselves revised in 2008 following the expansion of the FSCS by the Compensation Act 2006 (Contribution for Mesothelioma Claims) Regulations 2006 (SI 2006/3259). Lord Sumption has described some of the features of the guidelines, which, it appears, achieved general acceptance in the industry, by the FSCS and by reinsurers, before the decision of the Court of Appeal in the present case on 6 February 2013 appeared to undermine their application. Most recently, after consultations going back to 2010 and to meet the possibility that a mesothelioma victim might be unable to identify any solvent employer with an identifiable insurer, the Mesothelioma Act 2014 has established an insurance industry fund to pay out in such a case a sum fixed by schedule initially at about 80% but since a Ministerial announcement on 10 February 2015 at 100% of the average damages recovery which a victim of the particular victims age would be expected to recover in a civil claim. In Durham v BAI (Run Off) Ltd [2012] UKSC 14, [2012] 1 WLR 867 (the Trigger litigation), the Supreme Court held that, where an employer is insured against liability for a disease suffered by an employee which has been caused during the insurance period, the necessary causal requirement or link is satisfied in the case of mesothelioma by the employers negligent exposure of the victim during such period to asbestos (and so to the risk of suffering mesothelioma), with the result that the insurer must indemnify the employer against the liability so incurred. Guernsey has not passed any equivalent of the United Kingdoms Compensation Act 2006. The first main question on this appeal is whether, apart from that Act, the proportionate recovery rule in Barker still exists at common law. Guernsey common law is, as stated, to be taken to be the same as English common law. IEGs case is that Barker has become past history after the 2006 Act and in the light of the Supreme Courts decision in the Trigger litigation. The second main question concerns the position where the person responsible for exposing a mesothelioma victim has the benefit of liability insurance covering only part of the period for which he exposed the victim. If in such a case the person responsible incurs an expense or liability which is not proportionate, must an insurer who has covered only part of the whole exposure period bear the whole expense or liability? Before the Supreme Court, the parties and interveners accepted that such an insurer must, at least in the first instance, answer for the whole expense or liability, but Lord Sumptions judgment on this appeal raises for consideration whether they were correct to do so. Assuming they were, the further question arises whether such an insurer is in any way entitled to recoup himself proportionately, and if so from whom, when during the remaining period of exposure the employer chose either to insure with other insurers or not to insure at all or no identifiable insurer can now be shown to have covered the employer. If Barker no longer represents the common law, this question arises directly on this appeal. Zurich submits that it anyway also arises in respect of defence costs incurred by or on behalf of a person responsible for a particular exposure, where the overall exposure is greater. Most obviously, it is a question of general importance in the United Kingdom in relation to claims under the 2006 Act, though the present appeal concerns no such claim. The facts The facts can be shortly stated. IEG is a solvent Guernsey company, a supplier of gas to the Channel Islands and a subsidiary of a global utilities, transport, energy and timber company quoted on the New York Stock Exchange. IEG is the successor in title of Guernsey Gas Light Co Ltd (GGLCL), which for a period of over 27 years from 13 November 1961 to 31 December 1988 employed Mr Carr and during such employment exposed him to asbestos dust. Mr Carr subsequently contracted and died of mesothelioma. It is common ground for present purposes that Mr Carr was exposed with the same degree of frequency and intensity throughout the 27 year period, without adequate protection being provided by GGLCL, under circumstances that materially increased the risk of his contracting mesothelioma and constituted breaches of duty by GGLCL towards him. On 22 September 2008 Mr Carr brought proceedings against IEG claiming that he had sustained mesothelioma consequent on his exposure to asbestos dust throughout his 27 year period of employment with GGLCL. IEG settled his claim on 19 December 2008 by a compensation payment consisting of 250,000 in damages and interest plus 15,300 towards Mr Carrs costs. IEG also incurred defence costs of 13,151.60. Thereafter IEG looked to GGLCLs liability insurers under policies in force during the period of exposure. Two have been identified, first the Excess Insurance Co Ltd, which provided employers liability insurance for two years from 31 December 1978 to 30 December 1980, and, second the Midland Assurance Ltd, to whose insurance liabilities Zurich has succeeded, which provided such insurance for six years from 31 December 1982 to 31 December 1988. The present appeal thus proceeds on the basis that GGLCL had insurance for eight of the 27 years throughout which it exposed Mr Carr to asbestos dust. Guernsey did not have legislation making employers liability insurance compulsory until 1993, when the Employers Liability (Compulsory Insurance) (Guernsey) Law 1993 came into effect. Each of the Midland policies issued during the six years when it was on risk provided that: Whereas the Insured carrying on the business described in the Schedule and no other for the purposes of this insurance has applied to Midland Assurance Limited (hereinafter called the Company) for the insurance hereinafter contained and has paid or agreed to pay the premium as consideration for such insurance during the period stated in the Schedule or for any subsequent period for which the Company shall have accepted the premium required for renewal of this policy. If any person under a contract of service or apprenticeship with the Insured shall sustain any bodily injury or disease caused during any period of insurance and arising out of and in the course of his employment by the Insured in the business above mentioned, the Company will indemnify the Insured against all sums for which the Insured shall be liable in respect of any claim for damages for such injury or disease settled or defended with the consent of the Company. The Company will in addition pay claimants costs and expenses and be responsible for all costs and expenses incurred with the consent of the Company in defending any such claim for damages. IEG notified a claim for its total loss to Zurich, which offered to meet 72/326ths of the damages and interest paid to Mr Carr and of the defence costs incurred. The proportion reflected the relationship between the six years of the Midland insurance and the 27 year period of Mr Carrs exposure by GGLCL. It was arrived at on the basis that IEGs liability to Mr Carr was incurred and increased from day to day throughout the 27 years, while only six years of such liability fell within the period of the Midland insurance. (Any slight inaccuracy in equating a period of 27 years one month 17 days with 326 months can be ignored. Cooke J at trial converted 72/326ths into a percentage of 22.08%, which has not been challenged.) A trial was ordered on the basis of a statement of facts and issues recording the common ground between the parties, and on 24 January 2012 (two months before this court handed down judgment in the Trigger litigation) Cooke J accepted Zurichs case regarding the compensation, but not the defence costs, paid in respect of Mr Carr. He held it liable to pay 71,729.84 in full discharge of its policy liabilities, being its relevant proportion of such compensation plus 100% of the defence costs: [2012] EWHC 69 (Comm). On 6 February 2013 the Court of Appeal allowed IEGs appeal, rejected Zurichs cross appeal relating to defence costs, and ordered Zurich to pay 278,451.60, representing 100% of both the compensation paid and defence costs incurred by IEG: [2013] EWCA Civ 39. The Trigger litigation The issue in the Trigger litigation was whether and how various differently worded employers liability insurance policies should respond to mesothelioma claims. Typical wordings in use at various relevant dates were set out in annex A to and summarised in paras 7 to 9 of my judgment in that case. Under some of the policy wordings there considered (including some early Excess policies in different form to the present), the insurer promised to indemnify the insured employer against liability if at any time during the period of insurance (or of any renewal) any employee should sustain personal injury by accident or disease or [any] bodily injury or disease, while engaged in the service of the employer or in other cases arising out of and in the course of [his] employment by the insured employer. Other policy wordings were in more developed form, promising for example indemnity in respect of legal liability for sums payable as compensation for bodily injury or disease suffered by any employee when such injury or disease arises out of and in the course of employment by the Insured and is sustained or contracted during the currency of this Policy. The issue in the Trigger litigation was whether these wordings responded by reference to the date of exposure to asbestos dust or to the date when the onset of mesothelioma or any other long term disease developed or manifested itself. In determining this issue, this court found assistance as to the scope, purpose and proper interpretation of each of the insurances in a study of its language, read in its entirety (paras 19 and 41). It relied on the wordings assumption that the course of employment and the sustaining of injury would be contemporaneous (para 20) and that there would be a close link between the risks attaching to the employment or work undertaken in the insurance period and the risks which the insurers, for a premium calculated by reference to the nature of such employment during such period, agreed to insure (paras 21 23). It also relied on the improbability that insurers would offer or sell cover in respect of risks attaching to ancient, as opposed to current, employment or activities (para 24) or on a basis that would leave it open to insurers to refuse further cover once it became apparent that such employment or activities were likely to produce claims (paras 24 25). In the upshot, all the insurance wordings considered in the Trigger litigation were held to operate on a similar basis. Whether the wording referred to a disease contracted or an injury or disease sustained, the reference was to be taken as being to the date when mesothelioma was caused or initiated by exposure, even though it only developed or manifested itself long afterwards (paras 49 51). In respect of the limited number of the insurances with which the court was concerned which post dated the Employers Liability (Compulsory Insurance) Act 1969, the court also regarded its conclusions on interpretation as the only conclusions consistent with the employers duty to carry insurance under that Act. The Midland policy wording in issue on this appeal is expressly on a causation basis, and the risks undertaken are closely tied to the period of insurance. A second, yet more fundamental, point arose during the course of the appeal in Trigger. If causation grounded liability under the insurance wordings, could causation be shown to exist, bearing in mind that the special rule established by Fairchild, Barker and Sienkiewicz derives from the impossibility of proving as a matter of probability that any particular exposure has led or contributed to the occurrence of mesothelioma in any particular case? The rival possibilities examined in Trigger were that (a) the special rule involves a legal inference or fiction that, despite the evidential impossibility, the particular exposure has as a matter of probability caused or contributed to the occurrence of the mesothelioma or (b) the special rule involves a weak or broad view of the causal requirements or link satisfied in the case of mesothelioma by proof of exposure to asbestos dust or, both these possibilities failing, (c) the employers liability under the special rule arises not for, or because he has in any sense caused, the mesothelioma, but on the contrary for, and because of, his creation of the risk of causing the disease. On this last basis no relevant causation would have existed sufficient to trigger the insurance wordings in Trigger, since they required causation of a disease, not causation of a risk. In Trigger, none of the members of the court accepted possibility (a): see eg paras 59 and 71 74 in my judgment and para 131 per Lord Phillips. But Lord Phillips went on, after analysing Barker, to accept possibility (c). Dissenting, he held that employers could not pass on to their insurers the liability which they had incurred under the special rule, and he refused to engage in any redefinition of that special rule to render insurers liable: paras 133 134. The majority on the other hand accepted the employers case that insurances underwritten on a causation basis must respond in circumstances where employers incur liability for mesothelioma under the special rule because they have exposed the victim to asbestos dust during the relevant insurance period. In my judgment, with which Lord Kerr, Lord Clarke and Lord Dyson agreed, this was explained by reference to possibility (b): the ordinary requirements of causation (proof on a balance of probability) were modified as between the victim and person responsible, so as to make the latter liable for the mesothelioma because of the risk of sustaining mesothelioma to which the victim had been exposed during the relevant period: see paras 66 and 73. Further, and importantly, the majority also held that a liability insurer covering the person responsible on a causation basis must accept the development of, and the increase of employers liability resulting from, the special rule within the limits of the relevant insurance and insurance period: see paras 66 (end), 69 70 and 73 74. If causation is given a weak or broad meaning as against the person tortiously responsible, the same weak or broad meaning should be treated as carrying through into a liability insurance covering an insured on a causation basis. However, Trigger was not directly concerned with, and did not examine, the situation or the consequences where a person responsible for exposing a mesothelioma victim to asbestos dust has an insurance covering only part of the period of that exposure. That is the situation which gives rise to the present appeal. If one puts on one side the fact that exposure continued for a further 21 years, Trigger is direct authority that the Midland policy must respond to liability for mesothelioma incurred by IEG under the special rule as a result of GGLCLs tortious exposure of Mr Carr throughout the six year period of the Midland insurances. The policy period is fundamental under any liability policy, as the reasoning in Trigger summarised in para 18 above itself indicates. But, under Trigger, the sufficient weak or broad cause which grounds liability for any subsequently incurred mesothelioma occurs within the policy period, and that is sufficient. Zurich has at all times accepted that, if Mr Carr was, as a result of being exposed to asbestos dust during the six years for which Midland insured GGLCL, entitled to the full compensation payment of 250,000 plus costs which he received from IEG, then the policy wording on its face requires Zurich to answer in full notwithstanding that he was also exposed to asbestos dust during a further 21 years: see its written case before this court on the present appeal, para 4.4. However, the policy and its wording only govern the parties relationship in and with respect to the policy periods and risks arising during such periods. The special rule recognised in Fairchild as modified by the 2006 Act has the unique effect of requiring Zurich to respond potentially under its policy wordings to liabilities incurred by GGLCL/IEG which are: (a) attributable to the mere risk that GGLCLs conduct during the Midland insurance period led or contributed to Mr Carr incurring mesothelioma, but also (b) equally easily, or proportionately much more easily, attributable to GGLCLs conduct wholly outside the scope and period of the Midland insurance. Zurichs case is that, since GGLCLs conduct within (b) was wholly independent of and outside the scope of the Midland insurance and Midland insurance period, there is no reason why it cannot be recognised as giving rise to obligations as between Zurich and IEG, no inconsistency with the Midland insurance in recognising that such obligations may result from such conduct, and every reason in justice why this should be recognised. Barker The first main question on this appeal is whether Barker remains good common law, not in the United Kingdom, where it has been superseded by the 2006 Act, but in Guernsey where no such statute exists. I do not understand there to be any issue that, if Barker remains good common law, then IEGs liability in respect of the six years of Midland cover was and is for a proportionate part (22.08%) of the full compensation which IEG in fact paid. If Mr Carr had only been able to show six years of exposure with GGLCL, but a further 21 years exposure elsewhere, he could not have claimed more than 22.08% of his total loss from IEG. Equally IEG cannot now claim from Zurich more than the same proportion (22.08%) of the whole compensation paid which it can properly attribute to the six years of the Midland insurance. This is the corollary of the fundamental principle of indemnity, which governs liability insurance. This principle was articulated long ago in Godin v London Assurance Co (1758) 1 Burr 489, a case in which the defendant insurers were contending that because there had been double insurance they ought only to have to pay half the loss, although neither insurer had as yet paid any sum. Lord Mansfield, in giving the judgment of the court upholding a verdict for the whole loss in these circumstances, observed (p 492): Before the introduction of wagering policies, it was, upon principles of convenience, very wisely established, that a man should not recover more than he had lost. Insurance was considered as an indemnity only, in case of a loss: and therefore the satisfaction ought not to exceed the loss. If the insured is to receive but one satisfaction, natural justice says that the several insurers shall all of them contribute pro rata, to satisfy that loss against which they have all insured. Where a man makes a double insurance of the same thing, in such a manner that he can clearly recover, against several insurers in distinct policies, a double satisfaction, the law certainly says that he ought not to recover doubly for the same loss, but be content with one single satisfaction for it. And if the whole should be recovered from one, he ought to stand in the place of the insured, to receive contribution from the other, who was equally liable to pay the whole. In IEGs submission, Barker is fatally undermined by the Compensation Act 2006 and/or the decision in Trigger. IEG points out that section 16(3) of the 2006 Act provides that Section 3 shall be treated as having always had effect, and suggests that the Act was in section 3 declaring what the common law has always been. I do not accept that. Section 16 is a section dealing with Commencement, and the 2006 Act was clearly passed to change a common law rule expounded in Barker. It is true that the 2006 Act leads to a result which the common law might itself have accepted as appropriate: Trigger, para 70. But the common law did not do so, and the reasons why it did not are in my view both coherent and understandable. They are set out extensively in Barker, and I need not repeat them here. What the House did in Barker was to treat proportionality as a concomitant of the exceptional liability which derives from the special rule in Fairchild and which the House was, on that basis, prepared in Barker to extend to situations beyond those which Fairchild had held covered by it. The United Kingdom Parliaments reaction was its right, but does not alter the common law position apart from statute, or have any necessary effect in jurisdictions where the common law position has not been statutorily modified. In Trigger the court looked closely at Barker, and saw itself as applying what Barker established: see paras 63 66 and 72 of my judgment. At para 66 I noted that the speeches of Lord Hoffmann, Baroness Hale and (possibly) Lord Walker in Barker all viewed an employers legal responsibility as based on a weak or broad view of the causal requirements or causal link appropriate in the particular context to ground liability for the mesothelioma. To those references can be added that Lord Scott at para 50 and Lord Walker at para 103 in Barker both expressly agreed with Lord Hoffmanns reasons for allowing the appeals on the issue of apportionment. Further, there was in Trigger no issue about or challenge to the correctness of Barker. In these circumstances, it would on the face of it be surprising to find that Trigger had consigned that decision to history. IEG submits that, under Trigger, an employer shown to have significantly exposed a mesothelioma victim to asbestos dust is liable for having caused (in a weak or broad sense) the mesothelioma, and that anyone who is liable for causing a disease must answer for the whole loss resulting from that disease. In the Court of Appeal, [2013] EWCA Civ 39, that submission was accepted by Toulson LJ at paras 30 31 and Aikens LJ at paras 53 55. No doubt the submission is (subject to conventional limitations like remoteness and mitigation) generally correct in a conventional case where causation must exist in its ordinary sense of conduct which on a balance of probability brought about or contributed to the disease. But causation in a weak or broad sense is unconventional. Barker, as analysed in Trigger, accepted causation in this weak or broad sense and nonetheless held an employers responsibility to be proportionate to that part for which that employer was responsible of the victims total exposure to asbestos dust. Trigger cannot therefore be said to affect or undermine the reasoning or decision in Barker. The argument that insists that a conventional approach to the measure of damages must apply in a context where liability is imposed on an unconventional basis was rejected by Baroness Hale in her judgment in Barker. The relevant passages are worth quoting at length: 121. mesothelioma is an indivisible injury. What makes it an indivisible injury, and thus different from asbestosis or industrial deafness or any of the other dose related cumulative diseases, is that it may be caused by a single fibre. This much, as I understand it, is known, although the mechanism whereby that fibre causes the transformation of a normal into a malignant cell is not known. 122. But it does not necessarily follow from the fact that the damage is a single indivisible injury that each of the persons who may have caused that injury should be liable to pay for all of its consequences. The common law rules that lead to liability in solidum for the whole damage have always been closely linked to the common law's approach to causation. There is no reason in principle why the former rules should not be modified as the latter approach is courageously developed to meet new situations. Where joint tortfeasors act in concert, each is liable for the whole because each has caused the whole. The owner of one of the two dogs which had worried the sheep was liable for the whole damage because each of the dogs did in law occasion the whole of the damage which was suffered by the sheep as a result of the action of the two dogs acting together: Arneil v Paterson [1931] AC 560, 563, per Viscount Hailsham. Where two people, acting independently, shoot simultaneously and kill another, each is still liable for the whole. This is because, according to Prosser & Keeton on Torts, 5th ed, p 345, there is no sensible basis for dividing up the single damage which they have combined to cause for death cannot be divided or apportioned except by an arbitrary rule. 123. But as our perceptions of causation have expanded, so too has our conception of whether there may exist a sensible basis for apportionment. In Bonnington Castings Ltd v Wardlaw [1956] AC 613, the issue was whether the employer was liable at all, given that some of the exposure to dust was in breach of duty and some was not; but it could be shown that the tortious exposure had materially contributed to the harm, even if it was not the only cause. In McGhee v National Coal Board [1973] 1 WLR 1, where again some of the exposure was in breach of duty and some was not, but this time it could not be shown that the tortious exposure had even materially contributed to the harm, the issue again was whether the employer was liable at all; it was held that a material increase to the risk of harm was the equivalent of a material contribution to causing the harm. In neither case was it argued that the employer should only be liable to the extent that his behaviour had been in breach of duty. Yet in the case of diseases which progress over time, such exercises have now become commonplace, following the decision of Mustill J in Thompson v Smiths Shiprepairers (North Shields) Ltd [1984] QB 405, whether as between successive employers or as between tortious and non tortious exposure by the same employer. 124. There is, therefore, a logical connection between the law's approach to causation and the law's approach to the extent of liability. At each point along the road in developing the concept of causation, there is a choice to be made as to whether a single tortfeasor or a joint or concurrent tortfeasor should be liable for the whole or only for part of the damage. This is a policy question. One element in making that choice is whether there exists a sensible basis for apportioning liability. Another element is whether this would strike the right balance of fairness between claimant and defendant. 125. In one sense, there always exists a sensible basis for apportioning liability where more than one person is involved. Liability could be divided equally between them. But that would be arbitrary unless each was equally responsible. Even if liability were equally divided, this could be unfair to the claimant if, as in the dog worrying and shooting examples, each defendant has in fact caused the whole of his damage. In the Bonnington Castings and McGhee situations, where one employer is responsible for all the potentially harmful exposure, there may exist a sensible basis for apportioning liability, but it may still be unfair to the claimant to do this, if the one employer has undoubtedly caused all his harm. 126. But in the Fairchild situation we have yet another development. For the first time in our legal history, persons are made liable for damage even though they may not have caused it at all, simply because they have materially contributed to the risk of causing that damage. Mr Stuart Smith does not quarrel with the principle in Fairchild. He simply argues that it does not follow from the imposition of liability in such a case that each should be liable for the whole. I agree with the majority of your Lordships that indeed it does not follow. There is in this situation no magic in the indivisibility of the harm. It is not being said that each has caused or materially contributed to the harm. It can only be said that each has materially contributed to the risk of harm. The harm may be indivisible but the material contribution to the risk can be divided. There exists a sensible basis for doing so. Is it fair to do so? 127. In common with the majority of your Lordships, I think that it is fair to do so. On the one hand, the defendants are, by definition, in breach of their duties towards the claimants or the deceased. But then so are many employers, occupiers or other defendants who nevertheless escape liability altogether because it cannot be shown that their breach of duty caused the harm suffered by the claimant. For as long as we have rules of causation, some negligent (or otherwise duty breaking) defendants will escape liability. The law of tort is not (generally) there to punish people for their behaviour. It is there to make them pay for the damage they have done. These Fairchild defendants may not have caused any harm at all. They are being made liable because it is thought fair that they should make at least some contribution to redressing the harm that may have flowed from their wrongdoing. It seems to me most fair that the contribution they should make is in proportion to the contribution they have made to the risk of that harm occurring. 128. This solution is all the more attractive as it also provides the solution to the problem posed by the Barker appeal. If the damage could have been suffered during a period of non tortious exposure, it is suggested that the tortious exposers should escape liability altogether. There is considerable logic in this. One way of explaining Fairchild is that all were in breach of duty and one of them must be guilty, so that it made sense that all should be liable. That rationale does not apply, or certainly not with the same force, if there are other, non tortious causers in the frame. But if the tortious exposers are only liable in proportion to their own contribution to the claimants overall exposure to the risk of harm, then the problem does not arise. The victim's own behaviour is only relevant if he fails to take reasonable care for his own safety during a period of tortious exposure by a defendant. This reasoning remains in my view convincing at common law. In the United Kingdom, Parliament has, as is its right, taken a different view of the equities as between a person responsible and a victim of mesothelioma. That in turn gives rise to further problems of equity in relation to other, indirectly affected persons under the second main question on this appeal. But for the reasons I have given, neither the 2006 Act nor Trigger is inconsistent with or undermines the decision in Barker. For completeness, I record that Mr Antonio Bueno QC representing IEG expressly disclaimed any intention to invite the court to overrule Barker on this appeal. That, he frankly said, would bring in other considerations, and he said that IEGs case was that it has already become history as a result of Trigger. However, Mr Patrick Limb QC, also representing IEG, did at times appear to be inviting the court to address and overrule Barker head on. In my view, that latter invitation is not open to IEG, and further Barker has not been overruled by Trigger, and remains as part of the common law of England, which we are to take to be the same as the common law of Guernsey. The all sums policy construction issue The written cases identify under this head a secondary issue, concerning the extent of Zurichs liability to indemnify IEG. It arises from observations made by Aikens LJ, with whose judgment Kay LJ agreed. After concluding in para 53 that the majority in Trigger had grounded liability on a weak or broad causal link within the policy period, he went on in para 54 to say: Once that causal requirement is fulfilled, then the employer will have proved that the mesothelioma (the disease) was caused during any period of insurance. It follows from the policy wording that the insurer is then liable to indemnify IEG for all sums for which the Insured shall be liable in respect of any claim for damages for such disease (my emphasis). In other words, Zurich will be liable to indemnify IEG for the whole of the damages paid out by IEG in respect of Mr Carrs claim for damages for contracting mesothelioma, not just a proportion worked out by reference to the period during which IEG was covered by policies for which Zurich is responsible. The reference to all sums comes from the primary insuring clause set out in para 13 above. As I understand Zurichs written case, raising the secondary issue on the basis of this paragraph, Zurich was concerned that Aikens LJ was or might be suggesting that, even if Barker stood and applied (so that IEGs liability towards Mr Carr would have been limited to a proportion of his total loss, had IEG only exposed him for six out of the total of 27 years), IEG, having actually exposed him for the total 27 years though only insured with Midland for six of such years, might under the all sums provision in the insurance be entitled to recover from Zurich in respect of Mr Carrs total loss attributable to the 27 years. Any such argument would be clearly contrary to the fundamental principle of indemnity mentioned in para 26 above. Further, as I understand it, no such argument is in fact advanced by IEG. On the other hand, IEG appears to have understood Zurich to contend that, even if Barker had become past history (so that IEG was liable in full to Mr Carr for the whole of his loss resulting from mesothelioma, whatever the period for which it had exposed him compared with other periods of exposure), Zurich should under the Midland policies only answer for a rateable proportion of such total loss, viz 22.08%. For reasons indicated in para 23 above, I do not understand Zurich to make any such case. Zurich accepts that, if Barker no longer represents the common law, and IEG became liable for Mr Carrs full loss simply because he was exposed to asbestos dust during the six year Midland insurance period, then Zurich must on the face of the Midland policy wordings answer under the insurance, even though he was also exposed during 21 other years. In these circumstances, I need say no more on the secondary issue. It follows that the appeal must succeed as regards the compensation and interest paid by IEG to Mr Carr, because Barker continues to represent the common law position which applies in Guernsey. The Court of Appeal was wrong to set aside Cooke Js judgment, which should be restored, on this aspect. Defence costs That leaves the defence costs totalling 13,151.60 which IEG incurred in defending Mr Carrs claim based on exposure to asbestos dust over the full 27 years of his employment with GGLCL. Zurich submits that these costs should be pro rated on the same 22.08% basis. An important parallel, though not in my view identical, issue would arise in any case where the Compensation Act 2006 applies, making a responsible person liable for the whole damage suffered by a mesothelioma victim, regardless of the length and volume of his other exposures to asbestos dust. As regards defence costs, IEG relies upon reasoning adopted by the Privy Council in New Zealand Forest Products Ltd v New Zealand Insurance Co Ltd [1997] 1 WLR 1237. There proceedings were instituted on the basis of five causes of action against a company and its director, whose costs were both covered by an insurance policy, and in the case of one of the causes of action against a third person not so covered. All the defendants were represented by the same lawyers. It was common ground that costs not relating in any way to the insured directors defence would not be covered, while costs exclusively related to the insured directors defence would be covered. The issue which arose was as to defence costs which related at one and the same time to the defence both of the claim against the insured director and of the claim against the uninsured third person. The courts below took the view that there should be an apportionment. The Privy Council reached a different view, as a matter, it said, of construction of the relevant insurance. This covered all loss which such officer has become legally obligated to pay on account of any claim made against him for a wrongful act. As this wording would cover the whole costs incurred in the defence where the insured officer was the sole defendant, the Board saw no reason why it should not cover them all, where some of them related also to the defence of an uninsured co defendant. There was no question of the costs relating to any period other than that insured, and, importantly, they arose on a conventional causative basis because of a claim against the director for a wrongful act. Two points are notable in relation to the defence costs which IEG seeks to recover from Zurich. First, there is nothing to suggest that these would have been any less had the claim against IEG been confined to the six year period covered by the Midland policies. Second, and more significantly, the defence costs which IEG incurred were incurred with the consent of the Company in defending any such claim for damages within the meaning of the second sentence of the main insuring clause set out in para 13 above. That is, they were incurred by IEG in defending a claim by a former employee for damages for injury or disease which he was caused to sustain while employed during the periods of insurance provided by Midland. The claim against IEG could, under the special rule in Fairchild, be pursued on the basis that GGLCL had done no more than expose Mr Carr to a risk of suffering mesothelioma. In the light of Trigger the first sentence of the main insuring clause set out in para 13 above covers liability arising on this basis. But IEGs liability for and right to recover defence costs does not arise under the special rule, or on the basis that Mr Carr was exposed to any risk. It is not recoverable under the first, but under the second sentence of the main insuring clause. Under the second sentence, it is recoverable on the conventional basis that IEG can prove that it incurred (as a matter of fact or probability) actual financial loss in the circumstances covered by that sentence. This distinction is important. Once it is shown that an insured has on a conventional basis incurred defence costs which are covered on the face of the policy wording, there is, as the New Zealand Forest case shows, no reason to construe the wording as requiring some diminution in the insureds recovery, merely because the defence costs so incurred also benefitted some other uninsured defendant. The special rule analysis However, liability arising under the special rule in Fairchild on the exceptional basis of a weak or broad causal link consisting of exposure to a risk is different. As the volume of case law indicates and not surprisingly, it has proved difficult to work through the implications of the special rule in Fairchild. But, having, for wholly understandable reasons, gone down the Fairchild route, the common law must, in my view, face up to the consequences, if necessary by further innovation. That is so, even if some of the problems arise from Parliaments intervention by the 2006 Act. As already observed, the common law might itself have taken the same approach as that Act, though it did not in fact do so. Had it done, it would certainly have had to work out the common law implications. Parliaments intervention does not release the courts from their role of working out the common law implications of a special rule which remains essentially common law based, although subject to the modification introduced by the 2006 Act. Trigger may be regarded as an instance of performance of this role. It is worth emphasising how novel the situation created by Fairchild and Trigger is in an insurance context. When the present liability insurances were placed, what Hobhouse LJ said about the fundamental nature of the insurance period in the context of a property reinsurance in Municipal Mutual Insurance Ltd v Sea Insurance Co Ltd [1998] Lloyd's Rep IR 421, 435 436 would have been just as true of them: The judge came to the surprising conclusion that each reinsurance contract covered liability in respect of physical loss or damage whether or not it occurred during the period covered by the reinsurance contract and he went on expressly to contemplate that the same liability for the same physical loss or damage might be covered under a number of separate contracts of reinsurance covering different periods. This is a startling result and I am aware of no justification for it. When the relevant cover is placed on a time basis, the stated period of time is fundamental and must be given effect to. It is for that period of risk that the premium payable is assessed. This is so whether the cover is defined as in the present case by reference to when the physical loss or damage occurred, or by reference to when a liability was incurred or a claim made. Contracts of insurance (including reinsurance) are or can be sophisticated instruments containing a wide variety of provisions, but the definition of the period of cover is basic and clear. In short, insurance would have been and was placed on the basis that a particular liability or loss would fall into one, not a series of separate periods. If an insured wanted complete cover, it would have to maintain it for all such periods. The relevant period would also be ascertained by objective criteria, which meant that insureds could not select it at will or to obtain the advantage of the cover most favourable from their viewpoint. Thus: (i) Under a liability insurance where the trigger is causation in its traditional sense based on probability, no problem exists about allocating tortious liability to one and only one policy period. (ii) Under a claims made policy, claims must be notified and will attach at latest when they arise, while specific clauses dealing with the notification of circumstances likely to give rise to a claim may attach a claim to an earlier policy than that during which it actually arises. (iii) An insured may, for one reason or another, have double insurance. In that context, it may elect which to invoke, but well established principles exist for the two insurers to share liability equally up to the common limit. (iv) An insured may also agree to carry an excess or franchise, in which case it will have to bear that amount before looking to its insurer, and will as a self insurer rank last in any recoveries made by way of subrogation from any third party: Lord Napier and Ettrick v Hunter [1993] AC 713. Against this background, the present appeal illustrates some of the problems, arising from the special principles recognised and applied in Fairchild and Trigger, at the level of relationships between persons responsible and their insurers: (a) An employer, manufacturer or other person may well have been responsible for exposing employees and others to asbestos dust over many years. (b) For many years, he may have decided not to insure, or been unable to obtain cover which he regarded as acceptable. (c) During some years or as from some date, he may have decided to take out insurance. Employers should have done so, once employers liability insurance became compulsory, that is in and after 1972 in England, Wales and Scotland, 1975 in Northern Ireland and 1993 in Guernsey. (d) Even when insurance was taken out, it may have been taken out on a claims made, rather than causation, basis; even after employers liability insurance was compulsorily required, it may have been taken out on this basis under what Trigger indicates to have been the misapprehension that this form of insurance would satisfy that requirement. (e) Where insurance was taken out: (i) the employer, manufacturer or other person may not have fully appreciated the long term nature of the risks covered and may have failed to keep records from which the insurance can now be traced; or (ii) the insurer may have become insolvent. Where a person responsible for exposing a victim of mesothelioma to asbestos dust over a period of years has had liability insurance with the same insurer over the whole period, no problem arises. But frequently this will not have been, or cannot be shown to have been, the case, and the potential anomalies then arise. On IEGs case, the special rule, as modified by the 2006 Act and explained in Trigger, allows a person responsible for exposure to select any year during which he can show that he carried liability insurance and to pass the whole of any liability for such exposure to the liability insurer on risk in that year, without regard to other periods of exposure. anomalies are self evident: If matters stop there, and the insurer ends up carrying the whole liability, the (a) It is contrary to principle for insurance to operate on a basis which allows an insured to select the period and policy to which a loss attaches. This is elementary. If insureds could select against insurers in this way, the risks undertaken by insurers would be entirely unpredictable. (b) It is anomalous for a liability insurance underwritten for a premium covering losses arising from risks created during its particular period to cover losses about which all that can be said is that they arise from risks extending over a much longer period, in respect of which no premium has, or could have, been assessed or received by the insurer. (c) An insured is able to ignore long periods in respect of which he himself has chosen not to insure, or has not kept any record of any insurance which he may have taken out, or has chosen to entrust his insurance to an insurer who has become insolvent. (d) An insured has no incentive to take out or maintain continuous insurance cover. On the contrary, it is sufficient to take out one years cover, or even to arrange to be held covered for only one day, during whatever happens subsequently to prove to have been the overall exposure period whether this is done at the very start of the overall exposure period, or later after many decades of exposure, perhaps due to a sudden appreciation of the virtues of insurance under the special rule. In each case the anomaly arises because, without more, the analysis identified in the last sentence of para 42 above fails to adjust to the unique situation which arises from the principles recognised in Fairchild and Trigger. There are various responses that the law might have taken to such anomalies. One is that which Lord Phillips took in Trigger, viz that the insurance only answered for liability proved as a matter of probability to have resulted from asbestos exposure in the insurance period. Lord Phillips approach can be viewed as entirely conventional, in the sense that it reflected the traditional view that, under a liability policy like the Midlands, the concept of causation looked to the proximate or effective cause, to be proved as a matter of probability. But it would have meant that no liability insurance cover existed in respect of mesothelioma. In the light of this drastic consequence, the majority of the court in Trigger preferred a second response. It equated the concept of causation in an insurance context with the weaker or broader meaning which the courts have, to the benefit of victims, given it in tort. This was a choice rationalised in terms of the principle that a facultative liability insurance normally responds to whatever may prove to be the liability incurred by the insured. In Trigger there was no consideration of a situation in which a relevant insurance covered only part of an overall period during which the insured employer had exposed the victim to asbestos dust. But in my view the reasoning in Trigger binds this court to hold that the mesothelioma is caused in the sense that it results from exposure which existed in each and every period of any overall period of exposure. The fact that a victim or an insured only relies on one period of exposure does not alter the legal position, that it can equally be said to have been caused in every other period of exposure. This is because, as a matter of law, exposure connotes causation, in both tort and tort liability insurance law. It is the anomalies resulting from that conclusion which the court must now resolve, accepting but building on its own prior jurisprudence. Lord Sumptions judgment argues for a third response. He agrees that the respondents case involves all the anomalies already identified. But he considers that they can and can only be met by interpreting the insurance policy wording in a way which none of the parties or interveners before the court has suggested. He regards it as consistent with the decision in Trigger to say that an insurer, who only covers part of the total period for which the insured exposed the victim, is only liable for a corresponding part of the insureds liability to the victim. In my view, this is inconsistent with Trigger. Once one accepts that causation equates with exposure, in tort and tort liability insurance law, there is no going back on this conclusion simply because there was exposure by the insured of the victim both within and outside the relevant insurance period. More specifically, Lord Sumption suggests that the insurer must still show that the occurrence fell within the chronological limits of the policy (para 156). But that raises the question: what is here meant by the occurrence for which the employer is liable? It cannot be the disease itself, which can and does occur decades later. If it is the incident which causes the disease, then, as Lord Sumption himself recognises (para 157), it is each and every, or any, negligent exposure to asbestos involving a contribution by the employer to the risk of the victim sustaining mesothelioma that constitutes causation for the purposes of a liability insurance like the present. Any such exposure can be relied on as causing the mesothelioma and making the employer fully liable for the victims loss, and any such exposure occurring during any policy period will on a like basis mean that the insurer incurs full liability. Lord Sumption seeks to avoid this conclusion, acknowledging that it makes some sense as between successive employers who are guilty of a continuous tort, but saying that the same logic cannot be applied as between successive insurers (para 157). But the primary question is not as between two insurers, it is as between the employer and any insurer against which he claims; and there is also nothing illogical about a conclusion that each of successive insurers is potentially liable in full, with rights of contribution inter se. Lord Sumption also advances a broader argument, that it is conceptually impossible for mesothelioma to be successively caused in every period of exposure, because Mesothelioma is caused only once, or, as he later puts it, that it is not conceptually possible for an insurer to be liable on the footing that the disease was actually caused in every year (para 158). But this moves the terminological goalposts, by reverting to traditional notions of causation those applicable outside the Fairchild enclave, where proof on the balance of probabilities is traditionally required. Within that enclave, the House accepted in Fairchild that it was necessary to adopt a weak notion of causation, in order to protect victims, and in Trigger the Supreme Court held that this weak notion of causation carries through into an insurance context. On this basis, loss is caused for the purposes of tort and liability insurance contracts like the present in any and every period when the victim was exposed to asbestos and so to the risk of mesothelioma. Lord Sumptions broader argument is therefore incorrect. Moreover, if it had any force, it is not obvious why it would not apply equally to tort and so preclude one negligent employer from seeking contribution from another yet that is expressly provided for by the 2006 Act. Lord Sumption states further that Trigger cannot be applied without modification when the question is how much of the loss is attributable to particular years, and continues by saying the the rational response of the law is to prorate the whole loss between every policy year during which the insured employer exposed the victim to asbestos (para 160). Lord Sumption correctly points out that it is only when one aggregates every successive period that the chances add up to 100% (para 158). But this means, logically, that, if (as Lord Sumption maintains) any insurance can only answer pro rata for exposure or risk occurring during the insurance policy period, the relevant pro rating must be by reference to the total exposure of the victim from all employers and sources. The total period of exposure by the particular employer is in this context irrelevant, since the insurance wording says nothing about it and the chances of sustaining mesothelioma do not correspond with it when there are other sources of exposure. For all these reasons, I cannot therefore accept Lord Sumptions approach. An insurer, whether for the whole or part of the period for which the insured employer has negligently exposed the victim to asbestos, is on the face of it liable for the victims full loss. However, I agree that the analysis cannot stop here. The court is faced with an unprecedented situation, arising from its own decisions affecting both tort and insurance law. A principled solution must be found, even if it involves striking new ground. The courts cannot simply step back from an issue which is of their own making, by which I do not mean to suggest that it was in any way wrong for the courts, from Fairchild onwards, to have been solicitous of the needs of both victims and insureds. But by introducing into tort and liability insurance law an entirely novel form of causation in Trigger, the courts have made it incumbent on themselves to reach a solution representing a fair balance of the interests of victims, insureds and insurers. In my view, the law has existing tools which can be adapted to meet this unique situation. The concepts of co insurance and self insurance are both at hand. Co insurance is relevant in so far as the insured has other insurance to which it could also have resorted on the basis that it had also exposed the victim during the period of that insurance. Self insurance is relevant, because an insured who has not (i) taken out or (ii) kept records of or (iii) been able to recover under such other insurance must be regarded as being its own insurer in respect of the period in question for which it has no cover. A sensible overall result is only achieved if an insurer held liable under a policy like the Midland policy is able to have recourse for an appropriate proportion of its liability to any co insurers and to the insured as a self insurer in respect of periods of exposure of the victim by the insured for which the insurer has not covered the insured. There are of course difficulties about drawing a direct analogy between the present situation and conventional situations in which the concepts of co insurance and self insurance have previously been deployed. But the court would be abrogating its role to achieve a just solution consistently with what any sensible commercial party would have contemplated if it does not adapt and develop conventional principles to meet an unconventional, indeed unique, challenge. I see no barrier at all to this in the fact that the parties did not directly contemplate or cater for it in the insurance policy between them. It is equally clear that they did not contemplate or cater for the principles imposed upon them by the decisions in Fairchild and Trigger. To carry the declaratory theory to the point of asserting the contrary would be absurd. To say that [judges] never change the law is a fiction and to base any practical decision upon such a fiction would indeed be abstract juridical correctitude, rather it is the case that a judicial decision can change the law retrospectively: Deutsche Morgan Grenfell Group plc v IRC [2006] UKHL 49, [2007] 1 AC 558, para 23, per Lord Hoffmann. Equally, the fact that the parties may not have contemplated or made specific provisions about co insurance and self insurance on the basis of those decisions is no obstacle to the court doing so. To say (as Lord Sumption does: para 185) that there has here been a contractual allocation of risks which precludes the court taking steps to avoid evident absurdity which no contracting party can sensibly have contemplated or intended appears to me unrealistic. There was a contractual allocation of risks on the basis and in respect of exposure by the insured during the policy period. But if there was further exposure by the insured, outside the policy period, there is no reason why the insurer should not have proportionate recourse against anyone who can be seen to carry the risks attaching to such further exposure. There is nothing inconsistent with the agreed insurance or its period in deriving from a consideration of circumstances outside that insurance and its period a right to contribution in respect of the loss incurred in the first instance by the insurer: see further paras 67 73 below. In summary, so long as the insured has insured itself for the whole period for which it exposes the victim, the insurer can ask for no more, and must, as Trigger decides, bear the whole of any liability which the insured incurs. The palliative in this latter situation is of course that an employer/insured will have a right to contribution under the Civil Liability (Contribution) Act 1978 against any other person who was, negligently or in breach of duty, responsible for exposing the victim to asbestos, and its insurer will, after meeting the insurance claim, be subrogated to this right to contribution against the other responsible source of exposure. The anomalies therefore only arise when the insured has exposed the victim for a longer period than that for which it is covered by the insurer to which it chooses to look for indemnity. The anomalies are, as stated, not capable of being addressed by any of the laws existing tools for dealing with more conventional problems. As observed in Trigger, paras 67 68, section 3(3) of the 2006 Act preserves the conventional tools, found in the Law Reform (Contributory Negligence) Act 1945 and the Civil Liability (Contribution) Act 1978, for dealing with the conventional problems of contributory fault (by a victim of mesothelioma) and concurrent liability in respect of the same damage (between different persons responsible for exposing a victim of mesothelioma to asbestos dust, whether over the same or different periods). Persons responsible for exposing victims to asbestos dust are thus appropriately protected. Their protection is carried one step further by section 3(7), which enables the Treasury to make regulations for the provision of compensation to a responsible person who is unable to obtain contribution under the 1978 Act, because an insurer of such person is or is likely to be unable to satisfy the claim for a contribution. By definition in section 3(10), the reference in section 3(7) to a responsible person also includes an insurer of such a person. That is the only respect in which the Act addresses the interests of an insurer, as a corollary of the rules relating to contribution between persons responsible. The Act is not concerned with, and does not address, the effects on insurers or as between persons responsible and insurers of the special rule as modified by section 3(1) and (2). It is for the courts to work out these effects at that level. Co insurance So far as appears, during the overall period of 27 years during which it exposed Mr Carr to asbestos dust, GGLCL only had insurance for two periods, six years with Midland and two years with Excess. Not surprisingly, no previous authority exists regarding the relationship between Midland and the Excess in the present context. Zurich could not have any sort of subrogation right against Excess, since, if Zurich is liable for IEGs full loss, IEG can have no further claim for indemnity against Excess. Further, no one would ordinarily regard insurances for different insurance periods as double insurance. The reason for taking out or renewing a fresh annual policy during a fresh year is, on the contrary, the common sense truism that, unless one does so, one will be uninsured. The concept of double insurance, as hitherto recognised in English law, was explained by Mr Gavin Kealey QC, sitting as a deputy judge of the Commercial Court, in National Farmers Union Mutual Insurance Society Ltd v HSBC Insurance (UK) Ltd [2010] EWHC 773 (Comm), [2010] 1 CLC 557, para 15: Double insurance arises where the same party is insured with two (or more) insurers in respect of the same interest on the same subject matter against the same risks. If a loss by a peril insured against occurs, the general rule is that, subject to any particular modifying terms and to the limits of indemnity provided under each insurance contract, the insured may recover for the whole of the loss from either insurer. Upon such indemnity being paid to the insured by either one of the two insurers, that insurer is, in general, entitled to recover a contribution from the other. To quote from Lord Woolf in Eagle Star Insurance Co Ltd v Provincial Insurance plc [1994] 1 AC 130, 138: As was pointed out by Lloyd LJ at the beginning of his judgment in the Legal and General case [Legal and General Assurance Society Ltd v Drake Insurance Co Ltd] [1992] QB 887, 891], in general the principles on which one insurer is entitled to recover from another in a case of double insurance have been settled since Lord Mansfield's day. As Kitto J stated in Albion Insurance Co Ltd v Government Insurance Office of New South Wales (1969) 121 CLR 342, 349 350, a principle applicable at law no less than in equity, is that persons who are under co ordinate liabilities to make good one loss (eg sureties liable to make good a failure to pay the one debt) must share the burden pro rata: the object being, as Hamilton J stated in American Surety Co of New York v Wrightson (1910) 103 LT 663, 667: to put people who have commonly guaranteed or commonly insured in the same position as if the principal creditor or the assured had pursued his remedies rateably among them instead of doing as he is entitled to do, exhausting them to suit himself against one or other of them. Previous first instance statements to like effect that double insurance requires the same insured to be covered in respect of the same property against the same risks can be found in Petrofina (UK) Ltd v Magnaload Ltd [1984] 1 QB 127, 140F G per Lloyd J, followed in Wimpey Construction UK Ltd v D V Poole [1984] 2 Lloyds Rep 499, 516 (Webster J). The insurances taken out with Midland and Excess would not satisfy this concept. In particular, they were not on the same interest or against the same risks. Nor does the special rule recognised in Fairchild as modified by the 2006 Act make them so. The Excess policies covered injury or disease caused by the risk of exposure occurring in 1979 and 1980, whereas the Midland policies covered injury or disease caused by the risk of exposure occurring in the years 1983 to 1988. If one accepts the definition accepted by Gavin Kealey QC, then Eady J was right in Phillips v Syndicate 992 Gunner [2003] EWHC 1084 (QB), [2004] Lloyds Rep IR 426, para 22, to reject the submission that two or more successive policies of insurance could be regarded as covering the same liability towards a victim of mesothelioma for the purposes of a condition in the relevant policy in that case addressing situations of double insurance. However, Australian appellate courts have been willing to contemplate a more relaxed view of double insurance, to address situations where the same liability is ultimately covered albeit by different routes and involving different insureds: AMP Workers Compensation Services (NSW) Ltd v QBE Insurance Ltd [2001] NSWCA 267, (2001) 53 NSWLR 35, Zurich Australian Insurance Ltd v GIO General Ltd [2011] NSWCA 47. They have in a series of cases also emphasised the root principles of equity and justice which lie behind the laws recognition of rights of contribution: see Albion Insurance Co Ltd v Government Insurance Office of New South Wales [1969] HCA 55, 121 CLR 342, esp per Kitto J. Kitto Js judgment has been cited with approval in Burke v LFOT Pty Ltd [2002] HCA 17, 187 ALR 612, Zurich Australian Insurance Ltd v GIO General Ltd [2011] NSWCA 47 and, in a brief extract, by Lloyd LJ in the Legal and General case: see para 57 above. As Burke v LFOT Pty Ltd shows, Australian courts have carried the doctrine of equitable contribution far enough for it to provide as a matter of common law a right of contribution in respect of any common obligation, with a breadth and flexibility similar to that statutorily available in England under, now, the Civil Liability (Contribution) Act 1978, and, previously (though only as between tortfeasors), the Law Reform (Married Women and Joint Tortfeasors) Act 1935. In Burke itself the claim for contribution was only refused because it was inequitable in the particular circumstances to award any contribution against a negligent solicitor in favour of LFOT which had engaged in misleading and deceptive conduct in breach of a statutory obligation. Contribution is, ultimately, a principle based on natural justice, as Lord Mansfield said in Godins case, cited in para 26 above. A similar justification was given by Lord Chief Baron Eyre in Dering v Earl of Winchelsea (1787) 1 Cox Eq 318, 321, for recognising a right of contribution between sureties who had each accepted distinct and separate obligations and were not therefore in any contractual relationship with each other: If we take a view of the cases both in law and equity, we shall find that contribution is bottomed and fixed on general principles of justice, and does not spring from contract; though contract may qualify it . [I]n equali jure the law requires equality; one shall not bear the burthen in ease of the rest, and the law is grounded in great equity. A similar approach is not out of place in a context where the law has developed new liabilities to redress perceived injustice. Consistently with this, Charles Mitchell, in The Law of Contribution and Reimbursement (2003) notes, para 4.14, that The categories of claimant by whom contribution can be claimed at common law or in equity are not closed Mitchell cites in this connection, inter alia, Burke v LFOT Pty Ltd. Meagher, Gummow and Lehane in Equity, Doctrines and Remedies (4th ed) (2002), para 10 020, also note the influence on the principles governing contribution of the equitable maxim that equality is equity and the doctrine of marshalling, whereby: as between several interested parties it should not rest with the creditor by his selection of remedies open to him to determine where ultimately the burden was to fall. The Legal and General case, referred to in the passage cited by Mr Gavin Kealey QC (see para 57 above), illustrates the latter principle. There the insureds choice to proceed against insurer A under one policy meant that no notice of claim was given to insurer B under the other policy within 14 days as required by its terms. It was held by the majority (Lloyd and Nourse LJJ) that the absence of any such notice did not defeat the claim for contribution based on double insurance. Again, the reasoning is founded on broad principles of equity: Since the assured could have gone against B, had he chosen to do so, the burden as between A and B should be shared equally. It would be inequitable for either of the insurers to receive the benefit of the premium without being liable for their share of the loss. (per Lloyd LJ, p 892C D) There being no contract between the two insurers, the right of contribution depends, and can only depend, on an equity which requires someone who has taken the benefit of a premium to share the burden of meeting the claim. Why should that equity be displaced simply because the assured has failed to give the notice which is necessary to make the other insurer liable to him? As between the two insurers the basis of the equity is unimpaired. He who has received a benefit ought to bear his due proportion of the burden. (per Nourse LJ, at p 898B D) In my view, the principles recognised and applied in Fairchild and Trigger do require a broad equitable approach to be taken to contribution, to meet the unique anomalies to which they give rise. I note that this solution is also advocated by Professors Merkin and Steele in their recent study on Insurance and the Law of Obligations (2013) (OUP), p 378. If a broad equitable approach is taken in the present unique circumstances, then it should no doubt also be possible in the present context to overcome the normal presumption with double insurance that loss should be shared equally. Contribution between insurers covering liability on the basis of exposure should take account of differing lengths of insured exposure. Conventional rules need to be adapted to meet unconventional problems arising from the principles recognised and applied in Fairchild and Trigger. An alternative possible avenue of recourse against a double insurer in respect of policy liabilities based on breach of an obligation assumed on or after 1 January 1979 is the Civil Liability (Contribution) Act 1978. The argument would be that both insurers are liable for the same damage within the meaning of section 1(1) of that Act. The possibility that the 1978 Act applies is dismissed in Colinvaux & Merkins Insurance Contract Law, para C 0643, while Charles Mitchell in The Law of Contribution and Reimbursement, (2003), paras 4.13 and 4.43 4.44, suggests that it turns on whether liability under an indemnity insurance is regarded as the right to be indemnified by a payment of money or is, under a view which the author suggests that the cases favour, regarded as arising from breach of an undertaking to prevent the insured risk from materialising. It is unnecessary to resolve this difference here. It suffices to say that, if insurance contract liabilities are viewed as sounding in damages, it appears somewhat surprising if the 1978 Act could operate as an alternative statutory remedy with different effect in a case of true double insurance in respect of post commencement liabilities. Self insurance The extension of currently recognised principles of double or co insurance would operate only to address a very limited part of the problem. The fundamental problem remains that Zurich is, as a result of insurance policies covering only six years of exposure, liable for consequences of an exposure lasting 27 years. There can be and is no proof or likelihood that the mesothelioma resulted from fibres ingested in the six, rather than the remaining 27, years. Even assuming that Zurich has a right of contribution against the Excess, this can only be in respect of two of those 27 years, so that the two insurers would, if matters stopped there, share the consequences of 27 years of exposure by GGLCL on the basis of only eight years of insurance in the proportions of (Zurich) and (Excess). The obvious counter balance in this situation is to treat the insured employer, GGLCL or now IEG, as a self insurer for the remainder of the 27 year period in respect of which it can show no insurance capable of affording contribution. Nothing obliged GGLCL to maintain its liability insurance with any particular insurer. But in so far as it chose not to take out any insurance or chose to insure with another insurer, that should in common sense be at its risk. It should not be able to avoid the consequences of that risk by electing to pursue Zurich. IEGs response to such an approach is in substance two faceted. It submits, first, that it finds no support in existing or conventional principles of contribution, and, second, that the recognition of a right of contribution would be inconsistent with the insurance contracts made with Midland. In my opinion, neither aspect of this response is valid. As to the first, if the common law always depended on a precedent, Fairchild, or perhaps the earlier Scots House of Lords authority of McGhee v National Coal Board 1973 SC (HL) 37, should never have been decided as it was; but in any event, as I shall indicate, the concept of contribution to counter balance a prima facie contractual right is not without precedent. The second part of IEGs response, the suggested inconsistency between any right of contribution and the insurance contracts which Midland issued for six years, is taken up by Lord Sumption, who rules out recoupment merely because it operates by reference to the [insurance] contract (Lord Sumption, paras 184 and 185). The answer to this in my view is that a mere need to refer to the insurance contracts is not fatal to a recoupment claim. It does not involve contradicting or acting inconsistently with such contracts. On the contrary, it is accepting their implications, and relying on matters independent of them. It is relying on GGLCLs decision not to insure with Midland for 21 years and its decision, so far as appears, to go without insurance for up to 19 of such years. These are matters that are not touched by, and are outside, the terms and scope of the Zurich and Excess policies. They ground an equity that IEG should contribute proportionately to a loss arising from risks of exposure continuing throughout the whole 27 years. Second, however, I do not accept that there is any absolute bright line principle, of the sort which IEG and Lord Sumption advocate, whereby equity must always refuse to recognise a right of contribution between parties to a contract which according to its terms involves a particular result. Neither jurisprudentially nor on authority is this so. There is a general rule to that effect, but it is subject to exceptions. The position is well put by Professor Andrew Burrows QC in The Law of Restitution (3rd ed) (2011), p 88 et seq: (i) The general rule Where the defendant is legally entitled to the enrichment in the sense that that enrichment is owed to it by the claimant under a valid legal obligation [FN15: This will most commonly be a contractual or statutory obligation. ] there can normally be no liability to make restitution despite there being an unjust factor. The reason for this is that the prima facie injustice established by the unjust factor is normally outweighed by the fact that the defendant is legally entitled to the enrichment. Overall, therefore, the enrichment is not unjust. (ii) Exceptions to the general rule Although the general rule is that the claimant will not be entitled to restitution where the defendant was legally entitled to the enrichment, there are some exceptions. The interplay between the general rule and the exceptions is an interesting and difficult one which, until recently, had been little explored. In essence it would appear that the exceptions operate where, contrary to the general position, there is no policy inconsistency in granting the claimant restitution of the enrichment even though the defendant is legally entitled to it. Put another way, the prima facie injustice constituted by there being an unjust factor is not outweighed by the defendant's legal entitlement to the enrichment. Professor Burrows then gives four examples of exceptions, concluding, at p 91: The recognition and application of exceptions requires a carefully considered approach to the policies involved. A blanket rule that legal entitlement to the enrichment bars restitution does not represent the present law and would be needlessly blunt and insufficiently nuanced. Two of Professor Burrows examples are Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 and Deutsche Morgan Grenfell Group plc v IRC [2006] UKHL 49, [2007] 1 AC 558. The other two examples are restitution in respect of contractual obligations accruing due prior to frustration or termination for breach and restitution in respect of services rendered under an unenforceable contract. In Roxborough contracts for sale of tobacco products had been made at prices which took account of a so called licence fee which the High Court of Australia had subsequently held to be an unlawful excise duty. The majority held that it was not possible to imply any term to cater for this unforeseen eventuality (paras 20 and 60), but that restitutionary relief could be granted in respect of the tax component of the price. Gleeson CJ, Gaudron J and Hayne J said that there was no conceptual objection to treating this as a severable part of the consideration which had failed, because it would not result in confusion between rights of compensation and restitution, or between enforcing a contract and claiming a right by reason of events which have occurred in relation to a contract. (para 21) Gummow J said (para 75) that the action to recover the moneys sought by the appellants after the failure of the purpose of funding Rothmans to renew its licence may be illustrative of the gap filling and auxiliary role of restitutionary remedies. These remedies do not let matters lie where they would fall if the carriage of risk between the parties were left entirely within the limits of their contract. Hence there is some force in the statement by Laycock [The Scope and Significance of Restitution (1989) 67 Texas Law Review 1277, 1278]: The rules of restitution developed much like the rules of equity. Restitution arose to avoid unjust results in specific cases as a series of innovations to fill gaps in the rest of the law. As Gummow J went on to point out, there is authority of Lord Mansfield in the same direction. Moses v Macferlan (1760) 2 Burr 1005, a corner stone of common law restitution, was itself a case where the plaintiff successfully reclaimed in the Kings Bench money which he had been held liable to pay under various bills by the Court of Conscience, which had refused or been unable to look at the parties wider relationship outside the bills. The plaintiff could not rely on any express or implied promise to repay. Lord Mansfield grounded the obligation simply on the equity of the plaintiffs case to recover back money, which ought not in justice to be kept (pp 1009 and 1012), and later described it as a liberal action in the nature of a bill in equity: Clarke v Shee (1774) 1 Cowp 197, 199. In Deutsche Morgan Grenfell the legislation governing advance corporation tax (ACT) contravened EU law in not allowing the claimant the option to avoid or defer ACT by making a group income election. Absent any actual election by Deutsche Morgan Grenfell (DMG), ACT was strictly due. But it was held recoverable. Professor Burrows states, at p 91: The best explanation for the departure from the general rule is that restitution did not here conflict with the statutory obligation because that statutory obligation was undermined by the legislature's failure, contrary to EU law, to provide a group income election for companies such as the claimants. As a matter of policy the injustice of the ultra vires exaction outweighed the point that, technically, the Revenue was legally entitled to the tax. Unsurprisingly, in view of the obvious equity of DMGs position, the judgments take this aspect very shortly. Lord Hoffmann treated the election provisions as purely machinery and the real mistake as being whether DMG was liable for ACT (para 32). But Lord Hope (para 62) and it seems Lord Walker (para 143) (and Lord Scott, dissenting, paras 81 82) agreed with the trial judge (Park J) that the case fell to be analysed on the basis that, in the absence of any actual election, the tax was due. On that basis Lord Hope and Lord Walker held it recoverable, because it became due as a result of DMGs mistaken belief that it could not claim group relief by making an election. Lord Brown expressed general agreement with Lord Walkers speech (para 161 162), but elsewhere also spoke of the ACT as not due (para 172). In the present case, applying the approach indicated by Professor Burrows, there is no policy inconsistency between recognising that the terms of the insurances underwritten by Midland make Zurich answerable in the first instance for IEGs liability towards Mr Carr and recognising an equity, based on consideration of the wider circumstances in particular GGLCL/IEGs exposure of Mr Carr for further periods when it was not insured by Midland requiring IEG itself to contribute towards Zurichs cost of meeting such liability. This conclusion is also not inconsistent with the well established principle of insurance law that an insured can recover under an insurance for a risk which is covered, even though another cause of the loss exists which is not covered, so long as that other cause is not positively excluded: see eg Wayne Tank and Pump Co Ltd v Employers Liability Assurance Corpn Ltd [1974] QB 57. Generally, insurance law identifies a single effective, dominant or proximate cause, though there can be rare exceptions where there are dual effective causes as Wayne Tank illustrates. But the principle addresses a situation where more than one cause operating during the policy period can be said to have caused the insured loss in a conventional sense, that is by bringing it about or contributing to it as a matter of probability. It is not directed to the present situation where liability is based on a causal link consisting only of the risk involved in exposure, where the insured loss arises from exposure both within and outside the insurance period, and where the exposure outside the insurance period increased the risk of the insured loss occurring proportionately. Nor is the analysis in the previous paragraphs inconsistent with the House of Lords decision in Simpson & Co v Thomson (1877) 3 App Cas 279. An insured vessel was run down and lost with all its cargo in a collision due to the negligence of another vessel owned by the same insured. The underwriters of the first vessel having paid claimed to rank pari passu with the lost cargo owners in the distribution of the limitation fund lodged in court by the owners in respect of the second vessel. Insurers under English law have no right in their own name to recoup insured losses from wrongdoers. They have to rely on rights of subrogation, using their insureds name. Since the common owner of the two vessels could not sue himself, the underwriters claim failed. The case does not however address situations of contribution. Where there is a right to contribution, an insurer can recoup his loss from a third party. Here, the question is whether a right of contribution should be recognised by Zurich against IEG on the basis that IEG should in justice pay its proportionate part of a liability arising from a risk which increased proportionately over the whole period of 27 years during which it exposed Mr Carr to asbestos dust. It is equally irrelevant that the law knows no such thing as a contract of self insurance. It is of course true that, just as an insured cannot sue himself, so an insured cannot in law insure with himself. But the concept of self insurance is not unhelpful in identifying an important truth. A person who does not insure at all is well understood to be undertaking a risk for his own account, for which he should answer accordingly. A person who after insuring for a period with insurer A then goes for a period to insurer B is understood to be looking in relation to the later period to insurer B alone. Even courts are entitled to deploy a helpful phrase to point to such truths. The United States courts did so in Insurance Company of North America v Forty Eight Insulations Inc 633 F 2d 1212 and Security Insurance Co of Hartford v Lumbermens Mutual Casualty Co (2003) 264 Conn 688, 826 A 2d 107, when they held that, as between an insured and its insurers, liability for defence costs should be pro rated across all periods of insurance and self insurance during which exposure had occurred. In Lumbermens the insurer was thus held liable pro rata by reference to the relationship between its insurance period, other periods of insurance with other insurers and periods of self insurance. The use of the concept in this jurisdiction is illustrated by Lord Napier and Ettrick v Hunter [1993] AC 713, 730E F, where Lord Templeman had no hesitation about describing a Lloyds name as his own insurer in respect of a 25,000 excess under the stop loss policy in issue. He concluded in its light that such a name was not entitled, as against his stop loss insurers, to retain the benefit of damages for negligent underwriting received from the Outhwaite syndicate. The fundamental principle in Castellain v Preston (1883) 11 QBD 380, that an insured was entitled to be fully indemnified, was not helpful in deciding whether a name who promised the stop loss insurers to bear the first 25,000 loss is entitled to be put in the same position as an insured person who makes no such promise: p 731B C. In the present case, an insured who insures for a limited period necessarily accepts that it is only liability incurred during that period for which he has cover. The unique feature of the present situation is that the whole substratum of the relevant insurance policies has changed fundamentally since they were underwritten, and the law has, for the first time ever, imposed liability on the basis of risk, rather than the probability, that negligence during the insurance period led or contributed to the illness complained of. The concomitant of insurance liability in this situation must be a recognition that the law can and should redress the unjust and wholly anomalous burden which would otherwise fall on any particular insurer with whom insurance was only taken out for part of the total period of exposure by the insured, by recognising an obligation on the part of the insured to contribute pro tanto to such liability as a self insurer. In my opinion, therefore, Zurich is entitled to look to IEG to make a contribution based on the proportionate part of the overall risk in respect of which it did not place insurance with Midland and in respect of which Zurich does not recover contribution from any other insurer. Any contribution which is credited by Excess to Zurich in excess of 2/27 of Zurichs liability to IEG should also give Excess a corresponding right to contribution from IEG. I believe that this leads in practice, at least in the case of a solvent insured, to substantially the same result as that at which Lord Sumption arrives, but by a different route, which in my opinion reflects the reasoning and result in Trigger. The difference between the two routes may however be important in the context of an insured who is not solvent. It is convenient to address an area about which Lord Sumption expresses conclusions at the outset of his judgment, and to which he reverts at paras 172 173. That is that the conclusions reached up to this point will not mesh with the FSCS schemes established under the Financial Services and Markets Act 2000 for insurer insolvency (see para 6 above) and more recently the Mesothelioma Act 2014 for cases where there is employer insolvency and no identifiable insurer. This point relates to statutory schemes separate from and in part post dating the development of the common law and statutory principles with which this appeal is concerned. No submissions have been addressed to the court on it. That itself also suggests that the insurance industry and their expert representatives before this court do not share Lord Sumptions concerns. One reason for this may also be that Lord Sumptions account of the position is incomplete. He states that The effect of the majoritys view is simply to transfer risk from the statutory compensation schemes which were created to assume that risk, to an arbitrarily selected solvent insurer who has not agreed to do so (para 112, last sentence). This analysis does not address the fact that, on his own case, the statutory compensation schemes do not cover all situations or losses. Take a case of two responsible employers, one of which [A] is solvent or has a solvent insurer for the whole period for which it exposed the victim, the other of which [B] is insolvent and without any identifiable insurer. The victim will, on Lord Sumptions case (para 160), recover 100% from employer A. Employer B will be liable to contribute to employer A (or its insurer, by right of subrogation), but will have no money and no insurer to enable it to do so. The 2014 Act scheme will not step into the gap to enable employer A or its insurer to recoup pro rata contribution, because of section 2(1)(d) or (e), and possibly also because of section 2(1)(c), of the Act. This is because the Act was passed to protect unpaid victims, not for insurers benefit. It was and is directed, as the notes to the relevant Bill state, to situations where by virtue of the passage of time no solvent employer remains to be sued, and the employee is often unable to trace any insurer who was providing EL insurance to the employer at the relevant time. Recovery from another insurer of another employer precludes use of the 2014 scheme: see The Diffuse Mesothelioma Payment Scheme 2014, by Judge Nicholas Wikeley, Emeritus Professor at Southampton University, (2014) 21 JSSL 65, 78. Any action for damages or receipt of any damages or of a specified payment (which, like the 2014 scheme itself see para 6 above might not cover the full loss) precludes use of the 2014 scheme. This makes sense, since the 2014 scheme assumes, in general, that any recovery by a mesothelioma victim will correspond, even if only approximately, with full recovery of the victims whole loss. This is unsurprising in the light of Fairchild, the 2006 Act and Trigger, all of which form part of the background to the Act. But it indicates that the 2014 Act, far from supporting, is inconsistent with the scheme which Lord Sumption advocates whereby an insurer may only be liable to indemnify on a pro rata basis. Finally, if Lord Sumption be right and he has identified significant potential anomalies on the approach which has been advocated by counsel representing insurers before us and which in my opinion should be adopted, the reality is that the Fairchild enclave has necessitated adjustment from time to time of the legal and regulatory framework by the courts, the legislature and regulatory authorities. As Wikeley notes, further attempts to engineer improvements to the underlying compensation arrangements [are] almost inevitable (p 82). I do not myself see such a process of adjustment as one from which courts should withdraw. Third Parties (Rights against Insurers) Act Since IEG is solvent and has met the whole of Mr Carrs loss, the present appeal concerns only the relationship between IEG and Zurich. In that context, the precise legal relationship between Zurichs right to look to IEG for contribution and IEGs policy claim against Zurich does not matter. In practice, even if Zurichs right to contribution does not give rise to a defence, a procedural order for a stay would ensure that the one claim could not be enforced without taking into account the other. But in cases where the person responsible is insolvent, and the use of the Third Parties (Rights against Insurers) Act 1930 (soon, it is to be hoped, to be replaced by the 2010 Act) is invoked, it may be important whether the right of contribution which Zurich enjoys constitutes a defence reducing the indemnity for which the insured can sue under that Act. Section 1 of the 1930 Act provides: (1) Where under any contract of insurance a person (hereinafter referred to as the insured) is insured against liabilities to third parties which he may incur, then (a) in the event of the insured becoming bankrupt or making a composition or arrangement with his creditors; or (b) in the case of the insured being a company, in the event of a winding up order or an administration order being made, or a resolution for a voluntary winding up being passed, with respect to the company, or of a receiver or manager of the companys business or undertaking being duly appointed, or of possession being taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property comprised in or subject to the charge or of a voluntary arrangement proposed for the purposes of Part I of the Insolvency Act 1986 being approved under that Part; if, either before or after that event, any such liability as aforesaid is incurred by the insured, his rights against the insurer under the contract in respect of the liability shall, notwithstanding anything in any Act or rule of law to the contrary, be transferred to and vest in the third party to whom the liability was so incurred. (2) Where the estate of any person falls to be administered in accordance with an order under section 421 of the Insolvency Act 1986, then, if any debt provable in bankruptcy is owing by the deceased in respect of a liability against which he was insured under a contract of insurance as being a liability to a third party, the deceased debtors rights against the insurer under the contract in respect of that liability shall, notwithstanding anything in any such order, be transferred to and vest in the person to whom the debt is owing. (3) In so far as any contract of insurance made after the commencement of this Act in respect of any liability of the insured to third parties purports, whether directly or indirectly, to avoid the contract or to alter the rights of the parties thereunder upon the happening to the insured of any of the events specified in paragraph (a) or paragraph (b) of subsection (1) of this section or upon the estate of any person falling to be administered in accordance with an order under section 421 of the Insolvency Act 1986, the contract shall be of no effect. (4) Upon a transfer under subsection (1) or subsection (2) of this section, the insurer shall, subject to the provisions of section 3 of this Act, be under the same liability to the third party as he would have been under to the insured, but (a) if the liability of the insurer to the insured exceeds the liability of the insured to the third party, nothing in this Act shall affect the rights of the insured against the insurer in respect of the excess; and (b) if the liability of the insurer to the insured is less than the liability of the insured to the third party, nothing in this Act shall affect the rights of the third party against the insured in respect of the balance. When the 1930 Act applies, it therefore transfers to the mesothelioma victim the insureds rights under the insurance contract in respect of the insureds liability to the victim. The same is provided by the 2010 Act, not yet in force. Whether an insurers right to contribution against the insured constitutes a full or partial answer to a victims policy claim based on such a transfer is a question of great potential importance. It raises questions of some complexity, on which it is unnecessary to give a final answer on this appeal, but about which I wish to make some observations. One question is whether, apart from any statutory transfer under the 1930 or 2010 Act, the insurers right to contribution would be a defence at common law to a claim by the insured for indemnity under the insurance, as opposed to giving rise to procedural remedies such as a stay. A second is whether it makes any difference to the application of the relevant common law rules in this context that the claim is being brought under the 1930 or 2010 Act. A third is whether the terms of the Act positively exclude or restrict any such defence. The first and second aspects raise, as sub issues, the existence of any right of relief based on set off, circuity of action or other equitable basis. Zurich positively submitted that it would have no right of set off, legal or equitable. One objection to set off is that a right to contribution only arises upon payment by the person seeking contribution: see eg Andrews & Milletts Law of Guarantees (6th ed) (2011), para 12 019, citing Ex p Gifford (1802) 6 Ves Jr 805 and In re Snowdon (1881) 17 Ch D 44; and see Davies v Humphreys (1840) 6 M & W 153, Stirling v Burdett [1911] 2 KB 418 and In re Beaven [1913] 2 KB 595, 600. On the face of it, that presents a real obstacle to any suggestion by any insurer in Zurichs position of set off, whether legal or equitable, against IEGs claim for the full amount of its loss. There is however first instance authority endorsing the availability of a further remedy in cases where a person A (here, for example, Zurich), liable to make a payment to person B (here, the person suffering mesothelioma), has a potential right to receive contribution (or a full indemnity) from a third person C (here, IEG). In Wolmershausen v Gullick [1893] 2 Ch 514, Wright J made a prospective order in such a case directing that, upon person A paying person B, person C was to exonerate person A from liability beyond person As share. In Rowland v Gulfpac Ltd [1999] Lloyds Rep 86, 98, Rix J held that he had jurisdiction to grant a freezing order quia timet to support an indemnity claim by person A against person C, even though the common law claim for an indemnity was not complete. His decision was more recently followed by Burton J in Starlight Shipping Co v Allianz Marine & Aviation Versicherungs AG (The Alexandros T) [2011] EWHC 3381 (Comm), [2012] 1 Lloyds Rep 162, paras 37 38, where he said that the constitution of such a fund would ensure that person A was held harmless and not be required to use his own funds to discharge liabilities falling within the relevant contract of indemnity by person C. Accepting the fairness of the thinking behind this first instance authority without further examination, I doubt whether it could or should affect the application of the general principle mentioned in para 86 in the particular context of a claim by a victim under the 1930 or 2010 Act. Zurichs obligation under the insurance and that Act would be to indemnify the victim. Any consequential right to contribution from IEG would arise not under, but outside, the insurance contract in terms of section 1(1) of the 1930 Act. Considerations of justice and policy would also support the treatment of the insurance and the contribution positions as legally separate, when an opposite approach would be to the prejudice of the victim, in whose favour the insurance would otherwise operate and who is not concerned with the circumstances giving rise to any contribution claim. A second sub issue is that legal set off is in any event confined to debts due and payable and either liquidated or capable of ascertainment without valuation or estimation: Stein v Blake [1996] AC 243, 251 per Lord Hoffmann. On current authority, at Court of Appeal level, the right to recover under an insurance contract is classified not as a debt, but as a right in damages: see eg The Italia Express (No 2) [1992] 2 Lloyds Rep 281, 286, Sprung v Royal Insurance (UK) Ltd [1999] 1 Lloyds Rep IR 111. Further, a right to claim proportionate contribution would not normally satisfy the test of legal set off, although, on the agreed facts in this case, it might perhaps do so, since they lead to a definite percentage contribution of 22.08%. Regardless of the view taken on these two points, legal set off is procedural, not substantive. When one comes to the second aspect, the statutory transfer probably therefore precludes legal set off. In contrast, equitable set off, where available, can give rise to a substantive defence. The locus classicus is Hanak v Green [1958] 2 QB 9 and the later case law includes Federal Commerce and Navigation Co Ltd v Molena Alpha Inc (The Nanfri) [1978] 2 QB 927, and has, more recently, been analysed by Rix LJ in Geldof Metaalconstructie NV v Simon Carves Ltd [2010] EWCA Civ 667, [2010] 4 All ER 847. Rix J noted (para 26) that in The Nanfri the Court of Appeal had identified the need for the cross claim to arise out of the same transaction as the claim or be closely connected with it. He concluded (para 43(vi)) that the best restatement of the principle was that it applies where there were a cross claim so closely connected with [the claimants] demands that it would be manifestly unjust to allow him to enforce payment without taking into account the cross claim. Again, I consider that, in a context where any set off arises from circumstances outside the insurance policy and would be to the prejudice of a third party victim, the considerations of policy and justice behind the rules developed in Fairchild and Trigger would probably mean that it was just (rather than manifestly unjust) for Zurich to have to fulfil its insurance policy obligations, before asserting against IEG any contribution claim based on circumstances outside the scope of the insurance to the prejudice of that victim. Even in circumstances where liability insurance is not compulsory, it would be wrong to view liability insurance as if its only rationale was to benefit the insureds bottom line, rather than to give effect to legitimate expectations regarding the protection of employees and other third party victims. That rationale is reflected in the 1930 and 2010 Acts, and reinforced by the now compulsory nature of employers liability insurance. The court would also be entitled to take it into account, when considering for the purposes of equitable set off what is or is not manifestly unjust. As to circuity of action, this is an ill defined principle, recently confirmed though not elaborated in Farstad Supply A/S v Enviroco Ltd [2010] UKSC 18, [2010] Bus LR 1087, where previous authorities are identified. In the present context it could not, I think, be more than a remedy existing where there would be no point in a claim being permitted, because any amount awarded could be immediately recovered on another basis. On that basis, it could not add anything to the previous discussion. The third aspect identified in para 85 above would also be problematic, were it to be relevant. Where an insurer does have a set off (one which appears in each case to have been capable of operating in equity), there is conflicting authority as to whether such a set off is excluded by the 1930 Act. In Murray v Legal and General Assurance Society Ltd [1970] 2 QB 495, Cumming Bruce J held that a right to recover premiums did not arise in respect of the insureds liability to the third party, within section 1(2), and that insurers could not therefore set off unrecovered premiums. In Cox v Bankside Members Agency Ltd [1995] 2 Lloyds Rep 437, 451, Phillips J refused to follow Murray and held the third party claim to be subject to a set off arising from payment by insurers of defence costs falling within the insureds policy excess and recoverable either under an express policy term or in restitution. However, both these cases concerned cross claims which arose directly from and under the insurance policy. Here, any right of contribution is best analysed in my view as arising from circumstances outside the insurance policy, and on that basis as not capable of giving rise to a set off at all. As noted in para 86 above, no right of contribution normally arises until payment. Once the victim (person C) has established the liability of the insured (person B), person Bs rights to indemnity by the insurer (person A) under the contract in respect of that liability are transferred to person C. Neither Murray nor Cox concerned a defence to a claim under the insurance contract which was based on a cross claim arising from circumstances outside the insurance contract and which could only become due on person B being paid in full in respect of his liability to person C. There is thus, in my view, a strongly arguable case for treating the language of section 1(1) of the 1930 Act as entitling the third party to recover against the insurer in such a case, leaving the insurer to enforce any claim to contribution which it may have against anyone separately and in the ordinary course, subsequently. Conclusions For reasons given in paras 37 and 38 above, there are significant differences between the defence costs incurred by IEG and the hypothetical position regarding compensation in circumstances covered by the 2006 Act, which I have been discussing in paras 39 to 82. In particular, the right to defence costs exists under the insurances on a conventional causative basis, and the defence costs incurred were not increased by the fact that they related to a claim for an additional 21 years in addition to the six years insured by Midland. In contrast, in the hypothetical position, the insurer only incurs liability on the unconventional basis of a risk that the mesothelioma was due to exposure during the insurance period, when there was a proportionately greater risk that mesothelioma was due to exposure during other periods when the insured did not insure at all or chose to insure elsewhere. It may still be as a matter of fact that the likelihood of mesothelioma occurring (and so of any defence costs being incurred) would have been proportionately reduced, had there only been exposure during the six years of the Midland insurance. But the liability for defence costs incurred in defending a claim embracing a period longer than that insured arises directly from the policy wording, as it would always have been understood, and it has, at most, been only indirectly affected by the special rule of causation and statutory intervention which have impacted the rest of the main insuring clause. In these circumstances, the impetus to recognise a right to contribution as a matter of compelling justice and equity is self evidently diminished. I would therefore decline to recognise any such right to contribution in respect of defence costs, but I would accept that such a right exists regarding compensation in the hypothetical situation which would arise had the 2006 Act applied. On the agreed facts, the only tenable basis for apportioning responsibility and arriving at the appropriate contribution would be proportionately to the relevant periods of exposure insured and not insured with Midland. It follows from the above that the appeal should succeed on the first main point, as stated in para 35 above. It fails on the second main issue as regards defence costs. Had the 2006 Act been applicable, I would have recognised Zurich as having rights both to look to Excess for a pro rata share of liability and to require IEG to bear an appropriate contribution, as indicated in paras 39 to 82 above. As at present advised, and although IEG is solvent so that the present appeal is concerned only with the position between IEG and Zurich, I also consider that, in the case of a claim by a victim of mesothelioma against an insurer (such as Zurich) under the Third Party (Rights against Insurers) Act 1930, the insurer would be obliged to provide the full policy indemnity, without being able to set off against the victim any consequential right to contribution which it might thereafter have as against the insured (here IEG): see paras 83 to 93 above. LORD HODGE: (with whom Lord Mance, Lord Clarke and Lord Carnwath agree) The courts continue to grapple with the consequences of departing from the but for test of causation in order to provide a remedy to those who have contracted mesothelioma as a result of wrongful exposure to asbestos fibres. As the precise pathogenesis of that terrible disease is unknown, the House of Lords and the Supreme Court departed from established legal principle and extended the law of causation. As a result, an employer, which has wrongfully exposed its employee to significant quantities of asbestos fibres and thus materially increased the risk of his suffering mesothelioma, incurs liability in damages to the employee or his estate if the employee subsequently contracts the disease. The claimant does not have to prove on the balance of probabilities that the wrongful exposure caused or materially contributed to the development of the disease. This innovative rule of causation has, within its defined scope, which is not confined to mesothelioma, imposed liability not only on employers (Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32 and Barker v Corus UK Ltd [2006] 2 AC 572) but also on their liability insurers through the courts interpretation of liability insurance contracts (Durham v BAI (Run Off) Ltd [2012] 1 WLR 867 (the Trigger litigation)). Parliament has also intervened in section 3 of the Compensation Act 2006 by reversing the effect of Barker in relation to mesothelioma cases. This appeal concerns the liability of an insurer which has provided an employer with liability insurance cover for only part of the period of the employees employment, during which he was wrongfully exposed to significant quantities of asbestos fibres, and the employer was either uninsured for the rest of the period or was insured by an insurer who is now insolvent or who cannot now be traced. The principal issues are (i) whether the insurance policies respond to the full extent of an employers liability to the employee or only a proportionate part of that liability fixed by reference to the periods of cover for which premiums have been assessed and paid, and (ii) if the former, whether the insurer has a claim against insurers of the employer in respect of other periods of the employees exposure and against the employer itself for periods in which it was uninsured or in respect of which its insurer can no longer be identified or traced. This court is unanimously of the view that section 3 of the Compensation Act 2006 did not change the common law, which the House of Lords had laid down in Barker v Corus UK Ltd [2006] 2 AC 572, but overrode it only to the extent that the section provides. The court also holds, unanimously, that the appeal fails on the issue of defence costs. On those matters no more need be said. The division of opinion arises in relation to what Lord Mance describes as the second main question, namely the extent of the insurers liability when it has insured the employer for part only of the period of the employees exposure. It is a matter of agreement that liability insurance would have been placed on the basis that a particular loss would fall into one insurance period, for which the insurer had assessed the premiums and provided the cover. As Lord Mance has shown in para 43 of his judgment and Lord Sumption in para 155 of his, it would be seriously anomalous if the insurer, which provided cover for a small proportion of the period of the employees exposure, were to carry the whole of the employers liability without any recourse against others in respect of the other periods of exposure. The stark options to avoid the identified anomalies are: (i) to hold, as Lord Sumption propones, that the insurance contract is to be construed so that the insurers liability for the loss is limited to the proportion of the policy years in which it provided cover relative to the whole period during which the employer wrongfully exposed the employee to the asbestos fibres; or (ii) to adopt the approach, which Lord Mance proffers, that the insurer must meet the whole of the employers liability to the employee and that, having done so, the insurer has the right to seek proportionate contributions from other insurers, which gave liability cover to the employer in other periods, and also, in respect of any period in which there was no insurance company from which a contribution can be obtained, against the employer itself. Each approach is a possible way of avoiding unfairness to the insurer. Lord Mances is more radical. I have found this a difficult case, not least because I am generally averse to developing the common law other than by the application of general principles. I have shared the concerns which Lord Neuberger and Lord Reed have articulated. But we are where we are. The law has tampered with the but for test of causation at its peril: Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229, Lord Brown at para 186. The Fairchild enclave exists: the courts in Fairchild and Barker and the Trigger litigation, for obvious reasons of policy, have developed a special rule of causation to do justice to the victims of wrongful exposure to asbestos fibres who have contracted mesothelioma as a result. Having done so, the courts must address the consequences of that innovation. I am persuaded that this court should develop the law as Lord Mance has proposed for the following six reasons. The first three address the extent of the insurers liability to the employer. The next two relate to the rights of recourse of the insurer, once it has paid the employer or victim in implement of its obligations under its insurance policy. The final reason relates to Lord Mances proposal as a whole. First, in my view, the finding that the insurer, which has provided liability cover to an employer for only part of the period of the employees exposure, must meet the entirety of the employers liability for the whole period of exposure is consistent with the way the courts have developed the common law in the trilogy of cases. In particular, it is consistent with the position of the majority of this court in the Trigger litigation. In that case the majority imported into the insurance contract the weak or broad concept of causation, which the House of Lords had adopted in imposing tortious liability on the employer. To my mind this is clear from Lord Mances leading judgment in the Trigger litigation (in particular at paras 52 and 57, 64 68, and 72 74) and also in the concurring judgment of Lord Clarke of Stone cum Ebony (at paras 83 85). The creation of liability for mesothelioma by virtue of the exposure to the asbestos fibres, which materially increases the risk of that disease, means that the mesothelioma is caused in this broad sense in each and every period of such exposure, as Lord Mance argues in this appeal. As a result, the insurer, which provided liability insurance for a limited period, is exposed to the whole of the employees claim if there was wrongful exposure in that period. Secondly, while this imposes a heavy burden on the insurer which the employer selects to claim its indemnity, it is a result for which the appellants and interveners have argued in this appeal. It appears to be a result that the London insurance market is prepared to live with. It is striking that the insurance industry in this appeal has shown no enthusiasm for the elegant and less complex idea of construing the insurance contract to restrict the insurers liability to a proportionate part of the loss. Thirdly, it is consistent with the policy of the United Kingdom Parliament that the employee victim should be able to obtain damages for his loss in a straightforward way. This policy of protecting the employee victim is clear at a general level from the enactment of the Employers Liability (Compulsory Insurance) Act 1969. It is clear, more specifically, in Parliaments enactment of (i) section 3 of the Compensation Act 2006 to reverse the decision of the House of Lords in Barker and more recently (ii) the Mesothelioma Act 2014 to establish an insurance industry fund to deal with the contingency that a victim is unable to bring an action for damages against an employer or a relevant liability insurer. It is also consistent with the expansion of the Financial Services Compensation Scheme by the Compensation Act 2006 (Contribution for Mesothelioma Claims) Regulations 2006 (SI 2006/3259). Confining the insurers liability to a time related proportion of the employers liability would not be in line with this policy of the legislature and would probably engender further legislation. While Parliaments role of legislating in the public interest differs from the role of judges in developing the common law, it is legitimate for the courts to consider whether their initiatives are in harmony with legislative policy expressed in statutes: Johnson v Unisys Ltd [2003] 1 AC 518, para 37 per Lord Hoffmann. I turn to Lord Mances proposed innovations to address the serious anomalies, which he and Lord Sumption have identified, if the insurer in one insurance period were to bear 100% liability without any recourse against those responsible during other insurance periods. They are: (a) the broad equitable extension of the right of contribution between insurers and (b) a right of recoupment against the employer in respect of years in which it was not insured or can identify no insurer against which contribution can be claimed. Thus, fourthly, if, as I consider, it is correct that the majoritys decision in the Trigger litigation points towards the insurers 100% liability (para 104 above), the interpretation of the insurance contract as creating a pro rata liability is not an option and the anomalies must be addressed in some other way. Fifthly, I am not as concerned as Lord Neuberger and Lord Reed are about the danger of infecting other areas of the common law with uncertainty. The court is crafting a solution for the problems that stem from the alteration of the rules of causation and the solution applies only to cases to which the altered rules of causation apply. In other words the special rules apply only to cases within the Fairchild enclave. The House of Lords in Gregg v Scott [2005] 2 AC 176 has been careful not to allow the relaxation of the established rules of causation more widely by applying a weak rule of causation outside the Fairchild enclave. The courts will have to police the boundaries of the enclave. So long as (a) the rights of recourse against other insurers and the insured employer are recognised for what they are, namely as a means of avoiding anomalies as a result of the special rules of causation and (b) those special rules are confined to the circumstances which Fairchild addresses, there is no reason why the boundaries of the Fairchild enclave should not be preserved. I recognise that those boundaries are not coterminous with liability for mesothelioma and that the precise boundaries of the Fairchild principle, like those of the earlier case of McGhee v National Coal Board [1973] 1 WLR 1, may have to be worked out in other cases viz Novartis Grimsby Ltd v Cookson [2007] EWCA Civ 1261. But it is sufficient, in my view, that the insurers rights of recourse are available only within the Fairchild enclave. Finally, the practical solution which Lord Mance proffers appears to be consistent with the way in which the London insurance market has operated in handling mesothelioma claims. That may suggest that the solution will not give rise to major practical difficulties. This is not a view which I have come to without hesitation because I see the strength of the arguments (a) that the courts should develop the common law in a principled way, (b) that in the context of an insurance contract the correct tools to give effect to the parties intentions are construction of the contractual words or the recognition of an implied term, and (c) that the protection of the employee victims entitlement to recover damages is a matter for Parliament. In short, having dug a hole, the courts should not keep digging. But the majority judgment in the Trigger litigation, which is the first of the six reasons set out above, appears to preclude the construction of the insurance contract which the minority favour. That consideration and the other five reasons persuade me that Lord Mances approach is the best available means of avoiding the injustice which the insurer would otherwise suffer. LORD SUMPTION: (with whom Lord Neuberger and Lord Reed agree) I agree that this appeal should be allowed, but I regret that I cannot agree with the reasons given by the majority, which seem to me to be contrary to a number of basic principles of the law of contract and to be productive of uncertainty and injustice. Suppose that an insolvent employer had tortiously exposed his employee to asbestos for, say, 30 years before going out of business. The employer had failed to insure his liabilities at all for years one to 20. Insurer A insured his liability on an occurrence basis in year 21. Insurer B insured his liabilities under successive annual policies for years 22 to 30, but insurer B is insolvent. The majority would hold that, in a case governed by the 2006 Act, insurer A is liable for the entire loss incurred over the 30 years of exposure, although he was only on risk for one, but that he has an equitable right to recoup a proportionate part of that liability from the insolvent estate of insurer B in respect of the nine years when insurer B was on risk, and from the insolvent estate of the employer in respect of the 20 years when there was no insurance. The effect, and as I understand it the object, of this is to make insurer A, who is solvent, answerable, (i) in respect of periods when insurer A was not on risk but insurer B was; and (ii) for the failure of the employer to insure at all in the first 20 years. In my opinion, the correct result in this situation is that insurer A is liable for a proportionate part of the loss in respect of the one year out of 30 when he was on risk. The employee is entitled to recover insurer Bs proportion under the statutory compensation scheme established under section 213 of the Financial Services and Markets Act 2000 for cases of insurer insolvency. In respect of the 20 years when there was no insurance, he is entitled subject to the statutory conditions of eligibility to recover under the statutory compensation scheme established under the Mesothelioma Act 2014 for cases where there is no insurance. The effect of the majoritys view is simply to transfer risk from the statutory compensation schemes which were created to assume that risk, to an arbitrarily selected solvent insurer who has not agreed to do so. The liabilities of an insurer are wholly contractual. The answer to the questions now before the court necessarily depend on the construction of the contract and on nothing else. Under an annual policy of insurance written on an occurrence basis, the insurers liability is limited to occurrences caused during the contractual term. Where the relevant occurrence has been caused at an indeterminate time during the period of exposure, there are in my view only two possible meanings that can be given to the contract. One is that the insurer is not liable at all. That possibility was rejected by this court in Durham v BAI Runoff Ltd. (In re Employers Liability Policy Trigger Litigation [2011] 1 All ER 605.) The other is that each insurer must severally answer for a rateable part of the employers liability, corresponding to the proportion which his time on risk bears to the period of exposure. No insurer can be liable in respect of other periods when he was not on risk or there was no insurance in place at all. That appears to me to be the correct answer to the problem which has arisen on this appeal. The suggestion that an insurer who was on risk for only part of the period of exposure, however brief, can be liable as if he had been on risk for the entire period, is contrary to the express terms of the contract and to the nature of annual insurance. The suggestion that some doctrine of law can be devised which imposes on an insurer in one year the risk that insurers of other years may become insolvent or that in other years the employer may fail to insure at all, is both unprincipled and unjust. The suggestion that equity can partially adjust the result of this injustice by requiring the insured to repay to the insurer part of the insurance moneys which the latter was contractually obliged to pay him, is contrary to basic principles of law. It is the proper function of this court to review those principles. But the very immensity of this power requires it to act within a framework of legal principle. The court identifies general principles of law and applies them to the case in hand. If the facts of that case disclose some generally unsatisfactory feature of the law as hitherto understood, it may modify it. To devise a special rule for one industrial disease and impose it retrospectively on a policy that covers all industrial accidents and diseases, so as to alter what all members of this court acknowledge to be the basis of the parties agreement, seems to me to be an extremely undesirable course to adopt. It may fairly be said, and indeed is said by the majority, that this court had already, in Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32 created a special rule for mesothelioma which does not conform to the ordinary principles on which the common law acts. It has done this in the interests of avoiding a serious injustice. Therefore, the argument continues, it is incumbent upon us now to develop what is called the Fairchild enclave by devising ancillary rules which appear to do justice to cases within the enclave, even if they are also out of line with the ordinary principles of law. The difficulty about this approach is that a measure of legal coherence seems desirable even within the Fairchild enclave. The contractual analysis has the considerable advantage that it draws on a substantial body of existing legal principle, which can be expected to supply answers to unforeseen issues as they arise. The alternative is for the law to move from each one off expedient to the next. This can only generate knock on consequences which we are not in a position to predict or take into account. If there were no other way to achieve justice, these consequences should no doubt be borne. But it is quite unnecessary to do so in this case. In the first place, the incidents of liability in tort are the creation of rules of common law, whereas the extent of a contractual liability depends on the intentions of the parties. The scope for judicial inventiveness is therefore necessarily more limited in the latter context than in the former. Secondly, it goes without saying that insurers are as much entitled to justice as mesothelioma victims. Third, the protection of victims against the insolvency of some out of a number of employers liability insurers or the failure of an employer to insure at all in some out of a number of years of exposure, is properly a matter for statute. It has in fact been dealt with, to the extent that Parliament considers appropriate, by the creation of statutory compensation schemes. It is difficult in those circumstances to discern what social imperative can require us to depart from ordinary principles of law. Mesothelioma Between the end of the nineteenth century and the 1970s asbestos was commonly used for a wide variety of purposes, notably for sound and heat insulation in the building trades and in the manufacture of electrical and other appliances. It has been known for more than 80 years that exposure to high levels of asbestos is injurious to health, and in the United Kingdom regulations have sought to limit levels of exposure since 1931. Mesothelioma is a malignant tumour whose association with asbestos exposure was identified in the 1960s. It is usually caused by asbestos particles inhaled in the course of occupational exposure to the mineral, although occasionally by environmental asbestos. It is a breach of an employers duty to allow its employees to be exposed to significant levels of asbestos without taking reasonable steps to protect them from inhaling it. Mesothelioma has a number of distinctive characteristics. A single exposure to asbestos particles may be enough to cause the condition to develop but will not necessarily do so. The intensity of exposure depends, among other things, on the dose and fibre type. The greater the intensity and duration of exposure, the higher the risk that mesothelioma will develop. But once contracted the disease is not progressive with exposure: subsequent further exposure will not aggravate it. As Rix LJ put it in the Court of Appeal in the Trigger litigation [2011] 1 All ER 605, at para 51, summarising the findings of the trial judge: once the mesothelioma tumour is present and assured of growth (ie has passed the stage where a malignant mutation may die off), further asbestos exposure and indeed further asbestos fibres in the body can make no difference and are not causative. These features differentiate mesothelioma from other industrial diseases and from long term sources of damage such as the industrial pollution of land which are progressively aggravated by successive occurrences to a degree which is in principle capable of being measured or estimated. They present particular problems of attributing responsibility given that the disease is undetectable until shortly before death, and once initiated may be latent for many years (30 to 40 years is common) before the symptoms appear. If a person has been exposed to high levels of asbestos over a long period, it is impossible in the current state of medical science to determine at what stage he inhaled the fibres which ultimately led to his developing mesothelioma. This means that if he was exposed to asbestos by successive employers during that period, each period of employment will have materially increased the risk of his contracting the disease without necessarily causing it. Employers liability insurance has been compulsory in the United Kingdom since the Employers Liability (Compulsory Insurance) Act 1969, which came into force on 1 January 1972. Section 1(1) of that Act requires employers to be insured against liability for bodily injury or disease sustained by his employees, and arising out of and in the course of their employment in Great Britain in that business. It is normal for employers to be insured on an occurrence (as opposed to a claims made) basis under successive annual policies which may be underwritten by different insurers. Under most of the standard wordings in common use, an industrial disease will be treated as having occurred when it was caused or initiated, even though it only developed or manifested itself later. I shall return to this point when I come to deal more fully with the Trigger litigation. It follows from the characteristics of mesothelioma which I have described that three potential problems can affect the availability of insurance cover. The first is that where an employee was exposed to asbestos by different employers at different times, it will be impossible to determine which employers wrong caused the disease to develop and therefore which employers insurers should respond. The second is that even where only one employer was involved, that employer may have been insured for only part of the period of exposure, or may have been insured in different years by different insurers. It will then be impossible to determine whether at the time when the disease occurred the employer was insured or, if he was, under which policy and by which insurer. The third is that one or more of the insurers potentially liable may have become insolvent or have been wound up in the course of corporate restructuring or have ceased to carry on this class of business and simply disappeared. The present appeal is primarily concerned with the second of these problems, although it also has implications for the third. Since at least the 1990s the insurance industry in the United Kingdom has evolved voluntary procedures for dealing with these problems in the context of claims for mesothelioma. Since these procedures have had a significant influence on the positions taken by the parties to this appeal, and affect the commercial implications of the various possible outcomes, it is necessary to say something about them. The arrangements appear to have varied in detail, but since 2003 have been embodied in guidelines issued by the Association of British Insurers, a body predominantly comprising insurers but with some representation of non insurance interests. The 2003 Guidelines, which were issued in the aftermath of the decision in Fairchild, recommend a scheme of settlement which is described as equitable and pragmatic. Its essential features are: (i) that the victim is to be paid in full by the Lead Insurer; (ii) that where more than one employer is involved liability is notionally apportioned between them pro rata to their respective periods of culpable exposure, without regard to any difference in the intensity of exposure; (iii) that each employers proportion of the claim is then further apportioned between that employer and its insurer or insurers according to the proportion which their time on risk bears to the whole period of culpable exposure by that employer; and (iv) that periods when the employer was self insured, uninsured or unable to trace insurance are apportioned to the employer if it is solvent, and otherwise to the relevant employers insurers (irrespective of their solvency). The effect of point (iv) is that where the employer was insured but the insurer is insolvent, the insolvent insurers pro rata share is paid by the Financial Services Compensation Scheme established under section 213 of the Financial Services and Markets Act 2000, which is party to the scheme. According to Mr Allen, an experienced claims manager whose witness statement was put in by the Association of British Insurers, the main objectives of the industry scheme are to promote speed of settlement, to prevent the spiking of claims from an uninsured year into an insured one, or from a year with a higher deductible into another with a lower one, and to avoid time consuming and costly disputes about issues such as the dose, intensity or fibre type of a claimants exposure. His evidence is that it proved impossible in practice to persuade insurers to pay the employee up front and then sort out the distribution of the cost among other participants later. Insurers preferred to wait until the FSMA compensation scheme was committed. Subject to that, the industry scheme has been accepted by the United Kingdom industry and has not in practice been challenged by reinsurers, although they would be likely to do so if they thought that claims were being artificially spiked into a year when their reinsured was on risk. There is some dispute about how far the industry scheme has been accepted by insureds, as Mr Allen contends, but it is neither necessary nor possible to resolve that question. The facts International Energy Group Ltd (IEG), is the successor to the rights and liabilities of Guernsey Gas Light Company Ltd, which employed Mr Alan Carr between 1961 and 1988. Mr Carr claimed to have been negligently exposed by his employer to asbestos particles throughout that period, and to have contracted mesothelioma in consequence. The obligations of the employer to Mr Carr were governed by Guernsey law. It is agreed for the purpose of these proceedings that the common law of Guernsey is the same as the common law of England. The statute law is, however, different. One of the differences is that employers liability insurance was not compulsory in Guernsey until the Employers Liability (Compulsory Insurance) (Guernsey) Law 1993, which came into force on 1 March 1994. Nonetheless, Guernsey Gas was insured for at least part of the period during which it employed Mr Carr. It was insured between 31 December 1978 and 30 December 1980 by Excess Insurance Co Ltd, and between 31 December 1982 and 31 December 1988 by Midland Assurance Ltd. Accordingly Excess was on risk for two and Midland for six of the 27 years during which Guernsey Gas employed Mr Carr. For the remaining 19 years, the employer was either uninsured or else insured under a policy all trace of which has been lost so that it is for practical purposes unable to claim under it. IEG is, however, solvent and capable of meeting the claim from its own resources. Zurich Insurance plc, are a major insurer of employers liability in the British Isles who acquired Midland and succeeded to its liabilities. In September 2008, shortly before his death, Mr Carr began proceedings against the employer in the Royal Court in Guernsey in support of a claim for damages on the footing that it had exposed him to asbestos without adequate protection. The proceedings were settled in December 2008 for 250,000 in respect of damages and interest and 15,300 in respect of Mr Carrs costs. IEG also incurred defence costs of 13,151.60. The company settled these sums in full and claimed them from Zurich. Zurich offered to settle the companys claim in accordance with the industry guidelines. Since IEG was solvent, it offered a rateable proportion of the claim, reflecting the ratio of its time on risk to the total period of Mr Carrs employment by Guernsey Gas. IEG began the present proceedings against Zurich in support of their claim for the entire amount. It was agreed that the dispute should be resolved on the basis of agreed facts. These were, in summary, (i) that Mr Carr was exposed to asbestos with the same frequency and intensity throughout the 27 years of his employment by the employer, (ii) that that exposure materially increased the risk that he would contract mesothelioma, and (iii) that by reason of the exposure Guernsey Gas was in breach of its duty to him. Before examining the basis of IEGs claims and Zurichs response, it is necessary to deal with the complex legal background against which the rival contentions were advanced. The position as between employer and employee: Fairchild In Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32, the House of Lords held that where one of a number of successive employers must have caused the development of mesothelioma by tortiously exposing the employee to the same noxious agent, the ordinary rules for proving causation fell to be varied as a matter of policy so as to ensure that an irrefutable claim against at least one of an ascertained group of defendants should not fail for want of any scientific possibility of identifying him. The ordinary rule, as the House agreed in Fairchild, was that the employee must prove that the damage was caused by the particular defendant sought to be held liable. As Lord Bingham said of the ordinary rule, at para 9: The issue in these appeals does not concern the general validity and applicability of that requirement, which is not in question, but is whether in special circumstances such as those in these cases there should be any variation or relaxation of it. He regarded the issue before the House as an obvious and inescapable clash of policy considerations (at para 33). He continued: The crux of cases such as the present, if the appellants' argument is upheld, is that an employer may be held liable for damage he has not caused. The risk is the greater where all the employers potentially liable are not before the court. This is so on the facts of each of the three appeals before the House, and is always likely to be so given the long latency of this condition and the likelihood that some employers potentially liable will have gone out of business or disappeared during that period. It can properly be said to be unjust to impose liability on a party who has not been shown, even on a balance of probabilities, to have caused the damage complained of. On the other hand, there is a strong policy argument in favour of compensating those who have suffered grave harm, at the expense of their employers who owed them a duty to protect them against that very harm and failed to do so, when the harm can only have been caused by breach of that duty and when science does not permit the victim accurately to attribute, as between several employers, the precise responsibility for the harm he has suffered. I am of opinion that such injustice as may be involved in imposing liability on a duty breaking employer in these circumstances is heavily outweighed by the injustice of denying redress to a victim. Were the law otherwise, an employer exposing his employee to asbestos dust could obtain complete immunity against mesothelioma (but not asbestosis) claims by employing only those who had previously been exposed to excessive quantities of asbestos dust. Such a result would reflect no credit on the law. It seems to me, as it did to Lord Wilberforce in McGhee [1973] 1 WLR 1, 7 that: the employers should be liable for an injury squarely within the risk which they created and that they, not the pursuer, should suffer the consequence of the impossibility, foreseeably inherent in the nature of his injury, of segregating the precise consequence of their default. Lord Bingham concluded that all of the successive employers were liable. Lord Nicholls of Birkenhead, expressing the same view, put the matter as follows at paras 41 42: 41 The present appeals are another example of such circumstances, where good policy reasons exist for departing from the usual threshold but for test of causal connection. Inhalation of asbestos dust carries a risk of mesothelioma. That is one of the very risks from which an employer's duty of care is intended to protect employees. Tragically, each claimant acquired this fatal disease from wrongful exposure to asbestos dust in the course of his employment. A former employee's inability to identify which particular period of wrongful exposure brought about the onset of his disease ought not, in all justice, to preclude recovery of compensation. 42 So long as it was not insignificant, each employer's wrongful exposure of its employee to asbestos dust, and, hence, to the risk of contracting mesothelioma, should be regarded by the law as a sufficient degree of causal connection. This is sufficient to justify requiring the employer to assume responsibility for causing or materially contributing to the onset of the mesothelioma when, in the present state of medical knowledge, no more exact causal connection is ever capable of being established. Given the present state of medical science, this outcome may cast responsibility on a defendant whose exposure of a claimant to the risk of contracting the disease had in fact no causative effect. But the unattractiveness of casting the net of responsibility as widely as this is far outweighed by the unattractiveness of the alternative outcome. Lord Hoffmann, at para 63, said: which rule would be more in accordance with justice and the policy of common law and statute to protect employees against the risk of contracting asbestos related diseases? One which makes an employer in breach of his duty liable for the employee's injury because he created a significant risk to his health, despite the fact that the physical cause of the injury may have been created by someone else? Or a rule which means that unless he was subjected to risk by the breach of duty of a single employer, the employee can never have a remedy? My Lords, as between the employer in breach of duty and the employee who has lost his life in consequence of a period of exposure to risk to which that employer has contributed, I think it would be both inconsistent with the policy of the law imposing the duty and morally wrong for your Lordships to impose causal requirements which exclude liability. As Lord Hoffmann pointed out, more clearly perhaps than any other member of the committee, it was essential that each of the successive employers should have wrongfully exposed the employee to asbestos particles and thereby materially increased the risk of his contracting the disease. The same policy would not therefore necessarily have justified a finding that all manufacturers of a drug causing injuries to patients were fixed with liability, simply because it was impossible to prove which manufacturers product had been administered to the particular claimant. This was because the existence of the additional manufacturers did not materially increase the risk of injury: see para 74. Lord Rodger of Earlsferry made the same point, at para 170: part of the underlying rationale of the principle is that the defendant's wrongdoing has materially increased the risk that the claimant will suffer injury. It is therefore essential not just that the defendant's conduct created a material risk of injury to a class of persons but that it actually created a material risk of injury to the claimant himself. the claimant must prove that his injury was caused by the eventuation of the kind of risk created by the defendant's wrongdoing By contrast, the principle does not apply where the claimant has merely proved that his injury could have been caused by a number of different events, only one of which is the eventuation of the risk created by the defendant's wrongful act or omission. It should be observed that although the House was concerned with mesothelioma, it recognised that the legal issue was not necessarily peculiar to mesothelioma. It could arise in cases concerning other injuries or diseases or other sources of danger, provided that the damage was inflicted by the same destructive agent. The question, as they pointed out, had arisen in other jurisdictions whose law was reviewed by the House, in the context of groups of hunters, party goers, footpads and the like negligently causing injury, each member of which had materially increased the risk of the injury which occurred without its being possible to identify whose negligence had actually caused it: see Lord Bingham at paras 25 29, Lord Hoffmann at paras 73 74, and Lord Rodger at paras 158 160. In McGhee v National Coal Board [1973] 1 WLR 1, which was held to have been founded on the same principle as Fairchild, the problem had arisen from the impossibility of determining the precise causal mechanism by which the claimant employee had contracted dermatitis, when some hypotheses involved a breach of duty while others did not. More generally, as Lord Bingham observed at para 34, it would be unrealistic to suppose that the principle here affirmed will not over time be the subject of incremental and analogical development. The decision in Fairchild has not given entire satisfaction to all of its authors. Lord Hoffmann has described it as a revolutionary judgment. The ordinary function of the House of Lords in changing the common law is to modify some principle which had proved unsatisfactory. In Fairchild, the House did not modify or even criticise the general principle that the claimant had to demonstrate that the defendants negligence had on a balance of probabilities caused the injury. Instead, they created a special exception to it which could not be justified by reference to any general principle and depended on a distinction which had no rational factual or legal justification: Hoffmann, Constitutionalism and Private Law (Cambridge Freshfields Law Lecture, 28 January 2015). Be that as it may, the decision in Fairchild is the starting point for any analysis of the legal issues arising between successive employers, or between employers and their insurers. In Fairchild itself, the House of Lords left those issues unresolved. Subsequent decisions of the House of Lords and Supreme Court have cruelly exposed the problem of dealing with complex and interrelated issues piecemeal. In order to accommodate the implications of earlier decisions for issues which they did not directly address, it has more than once proved necessary to subject their reasoning to some reanalysis. Apportionment: Barker In Fairchild, the House of Lords held that each of the successive employers was liable, but expressly declined to decide how, if at all, the liability was to be apportioned between them: see Lord Bingham at para 34, Lord Hoffmann at para 74, and Lord Rodger at para 125. That question did, however, arise in Barker v Corus UK Ltd [2006] 2 AC 572. The facts of Barker were that each of the claimants had been exposed to asbestos particles by successive employers or else by employers in one period and the claimant himself in another. The House of Lords held that the Fairchild principle applied in these cases also. Against that background, the question which arose was stated by Lord Hoffmann, at para 25, as follows: whether under the Fairchild exception a defendant is liable, jointly and severally with any other defendants, for all the damage consequent upon the contraction of mesothelioma by the claimant or whether he is liable only for an aliquot share, apportioned according to the share of the risk created by his breach of duty. The ordinary rule in the law of tort is that, where a number of defendants separately contribute to the same indivisible damage, each of them is jointly and severally liable for the whole. For want of a better word, this can be called the Dingle principle after Dingle v Associated Newspapers Ltd [1961] 2 QB 162, in which it received its classic formulation at the hands of Devlin LJ at paras 188 189: Where injury has been done to the plaintiff and the injury is indivisible, any tortfeasor whose act has been a proximate cause of the injury must compensate for the whole of it. As between the plaintiff and the defendant it is immaterial that there are others whose acts also have been a cause of the injury and it does not matter whether those others have or have not a good defence. These factors would be relevant in a claim between tortfeasors for contribution, but the plaintiff is not concerned with that; he can obtain judgment for total compensation from anyone whose act has been a cause of his injury. If there are more than one of such persons, it is immaterial to the plaintiff whether they are joint tortfeasors or not. If four men, acting severally and not in concert, strike the plaintiff one after another and as a result of his injuries he suffers shock and is detained in hospital and loses a month's wages, each wrongdoer is liable to compensate for the whole loss of earnings. If there were four distinct physical injuries, each man would be liable only for the consequences peculiar to the injury he inflicted, but in the example I have given the loss of earnings is one injury caused in part by all four defendants. It is essential for this purpose that the loss should be one and indivisible; whether it is so or not is a matter of fact and not a matter of law. Contracting mesothelioma is indivisible damage. If it had been proved that all of the successors had contributed to causing the employees mesothelioma, they would have been jointly and severally liable for the whole damage on the Dingle principle. The question in Barker was whether the same principle applied when all that could be proved was that each employer had contributed to the risk without contributing to the disease. The trial judge and the Court of Appeal in Barker held that it did, and that each employer was jointly and severally liable. The House of Lords overruled them. It held by a majority (Lord Rodger dissenting) that liability was several, and fell to be apportioned according to the tortfeasors relative contribution to the risk, measured by the duration and intensity of the exposure for which he was responsible. The ratio of the decision may be taken from the speech of Lord Hoffmann, with whom Lord Scott of Foscote, Lord Walker of Gestingthorpe and Baroness Hale of Richmond agreed. Lord Hoffmann held that the Dingle principle could apply only if each employer had contributed to the employee contracting the disease or was deemed to have done so. But it could not be proved that they actually had done so, and Lord Hoffmann denied that Fairchild had introduced a rule that they were deemed to have done so by creating a material risk of contracting mesothelioma. That, he thought, had been the view of Lord Rodger and Lord Hutton in Fairchild. But he considered that the speeches of the majority were authority for the proposition that the creation of a material risk of mesothelioma was sufficient for liability: see paras 31 34. From this he concluded, at para 35: Consistency of approach would suggest that if the basis of liability is the wrongful creation of a risk or chance of causing the disease, the damage which the defendant should be regarded as having caused is the creation of such a risk or chance. If that is the right way to characterise the damage, then it does not matter that the disease as such would be indivisible damage. Chances are infinitely divisible and different people can be separately responsible to a greater or lesser degree for the chances of an event happening, in the way that a person who buys a whole book of tickets in a raffle has a separate and larger chance of winning the prize than a person who has bought a single ticket. He went on at para 43 to summarise his reasons for regarding the apportionment of liability according to the time and intensity of the wrongful exposure for which each successive employer was responsible as representing the fair outcome: In my opinion, the attribution of liability according to the relative degree of contribution to the chance of the disease being contracted would smooth the roughness of the justice which a rule of joint and several liability creates. The defendant was a wrongdoer, it is true, and should not be allowed to escape liability altogether, but he should not be liable for more than the damage which he caused and, since this is a case in which science can deal only in probabilities, the law should accept that position and attribute liability according to probabilities. The justification for the joint and several liability rule is that if you caused harm, there is no reason why your liability should be reduced because someone else also caused the same harm. But when liability is exceptionally imposed because you may have caused harm, the same considerations do not apply and fairness suggests that if more than one person may have been responsible, liability should be divided according to the probability that one or other caused the harm. And at para 48: Although the Fairchild exception treats the risk of contracting mesothelioma as the damage, it applies only when the disease has actually been contracted. Mr Stuart Smith, who appeared for Corus, was reluctant to characterise the claim as being for causing a risk of the disease because he did not want to suggest that someone could sue for being exposed to a risk which had not materialised. But in cases which fall within the Fairchild exception, that possibility is precluded by the terms of the exception. It applies only when the claimant has contracted the disease against which he should have been protected. And in cases outside the exception, as in Gregg v Scott [2005] 2 AC 176, a risk of damage or loss of a chance is not damage upon which an action can be founded. But when the damage is apportioned among the persons responsible for the exposures to asbestos which created the risk, it is known that those exposures were together sufficient to cause the disease. The damages which would have been awarded against a defendant who had actually caused the disease must be apportioned to the defendants according to their contributions to the risk. In the course of his analysis, at para 46, Lord Hoffmann referred to the implications of the alternative approach, which would have imposed joint and several liability: The effect of the Civil Liability (Contribution) Act 1978 is that if each defendant is treated as having caused the mesothelioma as an indivisible injury and pays the damages in full, he will be able to recover contribution to the extent that he has paid more than his fair share of the responsibility from such other tortfeasors as are traceable and solvent. But he will in effect be a guarantor of the liability of those who are not traceable or solvent and, as time passes, the number of these will grow larger. Experience in the United States, where, for reasons which I need not examine, the DES rule of several liability has not been applied to indivisible injuries caused by asbestos, suggests that liability will progressively be imposed upon parties who may have had a very small share in exposing the claimant to risk but still happen to be traceable and solvent or insured: see Jane Stapleton, Two causal fictions at the heart of US asbestos doctrine 122 LQR 189. That would, as I have said, not be unfair in cases in which they did actually cause the injury. It is however unfair in cases in which there is merely a relatively small chance that they did so. Lord Scott, at para 61, put the same points in this way: If the Fairchild principle were based upon the fiction that each Fairchild defendant had actually caused the eventual outcome, the analogy with tortfeasors each of whom had contributed to an indivisible outcome would be very close. But Fairchild liability is not based on that fiction. It is based on the fact that each negligent defendant has wrongfully subjected the victim to a period of exposure to an injurious agent and has thereby, during that period, subjected the victim to a material risk that he or she will contract the disease associated with that agent. Each successive period of exposure has subjected the victim to a further degree of risk. If, in the event, the victim does not contract the disease, no claim can be made for the trauma of being subjected to the risk: see Gregg v Scott [2005] 2 AC 176. But if the victim does contract the disease the risk has materialised. If the degree of risk associated with each period of exposure, whether under successive employers or during self employment or while engaged in domestic tasks, were expressed in percentage terms, the sum of the percentages, once the disease had been contracted, would total 100%. But the extent of the risk for which each negligent employer was responsible and on the basis of which that employer was to be held liable would be independent of the extent of the risk attributable to the periods of exposure for which others were responsible. The relationship between the various negligent employers seems to me much more akin to the relationship between tortfeasors each of whom has, independently of the others, caused an identifiable part of the damage of which the victim complains. The joint and several liability of tortfeasors is based upon a finding that the breach of duty of each has been a cause of the indivisible damage for which redress is sought. No such finding can be made in a Fairchild type of case and the logic of imposing joint and several liability on Fairchild defendants is, in my opinion, absent. Moreover, Fairchild constitutes an exception, perhaps an anomalous one, to the causation principles of tortious liability. It should not, therefore, be found to be surprising if consequential adjustments to other principles of tortious liability become necessary. Lord Walker, at para 113, drew attention to the fact that the Fairchild principle had involved a departure from ordinary rules of law, which called for the application of special principles of apportionment unique to the situation in which it applied: The solution to the problem is in my opinion more radical, in line with the radical departure which this House has already made in Fairchild. That case was decided by the majority, as I have already noted, not on the fictional basis that the defendants should be treated as having caused the claimant's (or deceased's) damage, but on the factual basis that they had wrongfully exposed him to the risk of damage. The damage was indivisible, but the risk was divisible a matter of statistics. In line with that new principle established or affirmed in Fairchild, and as a solution which does justice (so far as possible) both to the generality of claimants and to the generality of defendants, limited liability proportionate to risk is the better course for the law to take. Baroness Hale made a similar point in her own speech, at paras 122 and 126 127: But it does not necessarily follow from the fact that the damage is a single indivisible injury that each of the persons who may have caused that injury should be liable to pay for all of its consequences. The common law rules that lead to liability in solidum for the whole damage have always been closely linked to the common law's approach to causation. There is no reason in principle why the former rules should not be modified as the latter approach is courageously developed to meet new situations. But in the Fairchild situation we have yet another development. For the first time in our legal history, persons are made liable for damage even though they may not have caused it at all, simply because they have materially contributed to the risk of causing that damage. Mr Stuart Smith does not quarrel with the principle in Fairchild. He simply argues that it does not follow from the imposition of liability in such a case that each should be liable for the whole. I agree with the majority of your Lordships that indeed it does not follow. There is in this situation no magic in the indivisibility of the harm. It is not being said that each has caused or materially contributed to the harm. It can only be said that each has materially contributed to the risk of harm. The harm may be indivisible but the material contribution to the risk can be divided. There exists a sensible basis for doing so. Is it fair to do so? In common with the majority of your Lordships, I think that it is. The speeches of the majority in Barker are not easy to analyse, and perhaps for that reason the analysis of them by Lord Rodger in his dissenting speech has proved influential. He attributed to Lord Hoffman and those who agreed with him the opinion that the employer was liable for creating a risk of contracting mesothelioma, and not for the mesothelioma itself. I do not think that this is the correct analysis of the majoritys reasoning. In his essay in Perspectives in Causation, ed R Goldberg (2011), at p 8, Lord Hoffmann certainly adopted it. He suggested that the majority view in Barker had created a special cause of action for the causing of the risk. But his words in Barker itself were more circumspect. In the passage which I have cited from para 48 of his speech, he certainly suggested that the Fairchild exception treated the creation of the risk as the damage which gave rise to liability. But, like Lord Scott and Lord Walker, he emphasised that there was no cause of action for the risk in the absence of the disease. And Baroness Hale (at para 120), while agreeing with Lord Hoffmann, had no difficulty in agreeing with Lord Rodger that the damage which is the gist of these actions is the mesothelioma and its physical and financial consequences. It is not the risk of contracting mesothelioma. In my opinion, the natural reading of the speeches of the majority, read as a whole, is that the Fairchild exception is an exception to the ordinary rules of causation alone. It treats a material contribution to the risk as enough to discharge the burden of proving that the breach of duty has caused the disease. It followed that by reason of having contributed to the risk the employer was liable for the disease itself. Or, as Lord Walker put it at para 109, the Fairchild exception is A rule of law by which exposure to risk of injury is equated with legal responsibility for that injury. The real difference between Lord Rodger and the majority was that the majority thought that it was unknowable and irrelevant who had caused the disease to develop. They considered that each successive employer should be liable in proportion to the significance of its contribution to the risk because, exceptionally, what had made each of them liable for the disease was its contribution to the risk and not its contribution to the damage. Lord Rodger on the other hand thought that each successive employer was deemed to have contributed to the damage and that it was that contribution to the damage which was the source of the liability. He therefore thought that each of them incurred the joint and several liability which the Dingle principle imposed on those who severally contribute in different degrees to the same damage. Underlying his reasoning was an expressed reluctance to adopt an analysis of Fairchild which made the cases in which it applied into an enclave subject to rules quite different to those which applied generally in the law of personal injuries: see para 85. The majority on the other hand considered that Fairchild had already created the enclave and that the task in hand was to devise a basis of liability consistent with its peculiarities. Within three months of the decision in Barker, its effect was reversed by section 3 of the Compensation Act 2006. Section 3 applied in any case where a person (the victim) contracted mesothelioma as a result of exposure to asbestos, and another (the responsible person) was liable in tort for having wrongfully exposed him to asbestos, whether by reason of having materially increased a risk or for any other reason. Section 3(2) provided that the responsible person was liable irrespective of whether the victim was also exposed to asbestos on other occasions, either by other tortfeasors or in circumstances where there was no liability in tort. Not only was that person liable, but he was jointly and severally liable with any other responsible person. The result was to make each responsible person liable for the whole damage, without prejudice (see subsections (3) and (4)) to the right of contribution between them. Section 3 applied retrospectively: see section 16(3). The position as between the employer and his insurer: Trigger Mesothelioma, like other industrial diseases characterised by long periods of latent development, poses particular problems for insurers writing employers liability business on an occurrence basis. None of the cases which I have cited was concerned with the impact of the Fairchild exception on coverage under an employers liability insurance. That question arose in the Employers Liability Policy Trigger litigation, six cases heard together before the Supreme Court and reported under the title Durham v BAI (Run off) Ltd [2012] 1 WLR 867. A number of different policy forms were before the court. They all insured the employers liability for personal injury (including disease) contracted or sustained during the period of insurance, generally a year. There were two issues. The first was whether the trigger for the insurers liability was the exposure of the employee to asbestos (as the employers and the personal representatives of deceased employees contended), or only to the development or manifestation of mesothelioma (as the insurers contended). These alternatives were referred to as the causation basis and the manifestation basis respectively. It was clear that the policies did not respond if the manifestation basis was correct, for the disease developed or manifested itself long after the relevant policies had expired and generally after the victim had ceased to be employed. The second issue was raised in terms not by the parties but by Lord Phillips of Worth Matravers in the course of the hearing. It was whether, if the causation basis was correct, the triggering event could be shown in the current limited state of scientific knowledge to have occurred during the policy period. If not, it was suggested, the insurer could not be liable at all. The leading judgment was delivered by Lord Mance. The courts decision on the first issue is summarised at paras 49 51 of his judgment. It was held that the policies insured the damage attributable to the actual injury or disease, which was suffered when mesothelioma developed. But the triggering event which had to occur within the policy period was the event upon which mesothelioma was sustained (the term used in the Midland policies in the present appeal) or contracted (the term used in some other policies). In either case, that happened when it was caused or initiated, even though it only developed or manifested itself subsequently. The whole panel was agreed upon this. The second issue turned on the effect of Fairchild and Barker on the footing that causation or initiation of the disease was the relevant triggering event. This question divided the panel. Lord Phillips in his dissenting judgment held that the insurers could be found liable only if the effect of these decisions was that the employer was deemed to have caused the development of the disease by exposing the employee to asbestos particles. That analysis of Fairchild had, however, been rejected by the majority in Barker. The alternative in his view was to treat Fairchild as creating liability not for the disease but for the contribution to the risk of the disease. Since the contribution to the risk was not an insured peril, the insureds and their statutory assignees could succeed against the insurers only if they demonstrated that the disease had in fact been caused or initiated during the policy period, something which the current state of scientific knowledge made it impossible for them to do. This view was rejected by the majority. Again, the reasons may be taken from the judgment of Lord Mance. He agreed that the deemed causation theory had been rejected in Barker. He held that the employer was not liable for merely exposing the victim to the risk. He was liable for the disease. But he was liable for the disease, because his tortious exposure of the victim to the risk was in law enough to establish that he had caused it. The issue, as Lord Mance put it at para 66, concerned: the meanings we assign to the concept of causation, first in the context of considering employers liability to their employees and then in considering the scope of employers insurance cover with respect to such liability. He summarised the effect on the policy at paras 73 74 as follows: 73. In my view, these considerations justify a conclusion that, for the purposes of the insurances, liability for mesothelioma following upon exposure to asbestos created during an insurance period involves a sufficient weak or broad causal link for the disease to be regarded as caused within the insurance period. The risk is no more than an element or condition necessary to establish liability for the mesothelioma. The reality, reinforced by provisions in the 2006 Act, is that the employer is being held responsible for the mesothelioma. 74. For this purpose, the law accepts a weak or broad causal link. The link is to exposure which may but cannot be shown on the ordinary balance of probabilities to have played a role in the actual occurrence of the disease. But for the purposes of the policies the negligent exposure of an employee to asbestos can properly be described as having a sufficient causal link or being sufficiently causally connected with subsequently arising mesothelioma for the policies to respond. The concept of a disease being caused during the policy period must be interpreted sufficiently flexibly to embrace the role assigned to exposure by the rule in Fairchild and Barker. Viewing the point slightly more broadly, if (as I have concluded) the fundamental focus of the policies is on the employment relationship and activities during the insurance period and on liability arising out of and in course of them, then the liability for mesothelioma imposed by the rule in my opinion fulfils precisely the conditions under which these policies should and do respond. In substance, the result was that the same weak test of causation which applied as between the victim and the employer should be applied as between the employer and his liability insurer. The parties arguments This appeal is not concerned with multiple successive causes of exposure to asbestos, nor is it concerned with multiple successive employers. Guernsey Gas, for whose liabilities IEG is responsible, employed Mr Carr throughout the 27 year period when he was tortiously exposed to asbestos. IEGs case for recovering in full against the insurers who were on risk for six of those years is as follows. The decision of this court in the Trigger appeals established (i) that the policy responds if during the period of insurance something happened which caused the ultimate development of mesothelioma, and (ii) that that causal link is sufficiently demonstrated by proving that during the period of insurance the insured employer wrongfully exposed the employee to the risk of contracting mesothelioma. Therefore, it is said, just as an employer is liable if he employed the victim at any time when he was wrongfully exposed to the risk of contracting mesothelioma, so the employers liability insurer is liable if he was on risk at any time when such exposure occurs. If by statute the employer must bear the entire loss attributable to the disease by reason of having exposed the employee to asbestos particles at any time that is also the measure of his claim against the insurer. Zurich advances two alternative contentions in response to this. The first is that as between the victim and his employer Barker remains good law in all cases to which the Compensation Act 2006 does not apply. It therefore remains good law in Guernsey, where Mr Carr was employed. It follows that the liability of Guernsey Gas is apportionable over the period of exposure, and that the insurer is liable only for a proportionate part of the loss representing that part of the period of exposure during which he was on risk. If, contrary to this submission, Barker is no longer good law even in Guernsey, Zurich concedes that it is liable under the policy terms for the whole of Mr Carrs loss. On that footing, Zurichs second argument is that they have a right of equitable recoupment against the other insurers pro rata to their respective periods on risk, and against the employer for that proportion of the claim which reflects the time he was uninsured. So far as the compensation element of the claim is concerned, the second argument arises only if the first one fails. But as far as the claim for defence costs is concerned, the second argument arises anyway, because Zurich accepts that they were contractually liable for the whole of the defence costs. This is because the same defence costs would have been incurred whether the employer was liable for the whole loss or only a proportion of it. The decisions of Cooke J and the Court of Appeal Cooke J accepted Zurichs first argument. He held that the insurer was liable only for a rateable proportion reflecting time on risk. The alternative claim for recoupment therefore did not arise. But if it had arisen, Cooke J would have rejected it. The Court of Appeal reversed him on Zurichs primary case. They held that Barker was no longer good law after the Compensation Act, and therefore no part of the common law of Guernsey. It followed in their view that each successive insurer was liable for the entire loss. They considered that no allowance fell to be made for the substantial periods of exposure when it was not on risk, whether that was because other insurers were on risk or because the employer elected to bear the risk itself. Both Toulson LJ and Aikens LJ, who both delivered reasoned judgments, considered that the issue was concluded by Trigger, in particular the statement of principle in the judgment of Lord Mance at para 73. Both of them thought that once it was accepted that each insurers liability was triggered by any period of exposure during which it was on risk, it followed as a matter of course that each insurer was liable for the entire loss. Citing the decision of the United States Court of Appeals for the District of Columbia in Keene Corporation v Insurance Company of North America (1981) 667 F 2d 1034, Toulson LJ expressed at para 42 his agreement with the proposition that: once it is accepted that exposure during any policy period met the causal requirement for the employer's liability to the victim, for which the employer was potentially entitled to indemnity from the insurer under the terms of the relevant policies, to withhold part of that indemnity from the employer on account of its conduct in other years would be to deprive the employer of insurance coverage for which it paid. Aikens LJ agreed, adding at paras 53 54 what is perhaps implicit in Toulson LJs judgment and may stand as the essence of the courts reasoning: If an employer is liable to his employee for his employee's mesothelioma following upon a tortious exposure to asbestos created during an insurance period, then, for the purposes of the insuring clause in the employers liability policy, the disease is caused within the insurance period. This is because it is sufficient that there is what Lord Mance calls (following Hart & Honors use of the phrase) a weak or broad causal link, in this case between the exposure to the asbestos during the insurance period and the employee's eventual contraction of the mesothelioma. Once that causal requirement is fulfilled, then the employer will have proved that the mesothelioma (the disease) was caused during any period of insurance. It follows from the policy wording that the insurer is then liable to indemnify IEG for all sums for which the Insured shall be liable in respect of any claim for damages for . such disease (my emphasis). In other words, Zurich will be liable to indemnify IEG for the whole of the damages paid out by IEG in respect of Mr Carrs claim for damages for contracting mesothelioma, not just a proportion worked out by reference to the period during which IEG was covered by policies for which Zurich is responsible. Like Cooke J, the Court of Appeal rejected the recoupment argument. The decision of the Court of Appeal created consternation among the interests represented by the Association of British Insurers. This was mainly because the decision recognised a right in an insured employer to recover in full from any insurer on risk at any time during the period of tortious exposure. In practise this meant that employers could be expected to pick off the easiest target. This undermined the industry settlement scheme, which: (i) apportioned the liability by time on risk among all insurers on risk during the period of exposure; (ii) apportioned uninsured periods to the employer if he was solvent; and (iii) left the employer to claim against an insolvent insurer under the compensation scheme established under section 213 of the Financial Services and Markets Act 2000. These consequences of the decision would be aggravated if there was no right of contribution between insurers. The result, the Association of British Insurers submitted, would be to encourage insurers to be more vigorous in defending claims, to delay settlements and potentially to cause difficulties with reinsurers. In addition, the Court of Appeals reliance on the all sums wording of the insuring clause opened up the prospect that insurers might be held liable in full even in the case of divisible diseases where the contribution of the tort to the actual development of the disease was more readily assignable to distinct policy periods. The issues in the Supreme Court In this court, the parties arguments were the same as they were in the courts below. However, after the case had been argued for the first time before five justices, the court raised a number of further questions with the parties which expanded the scope of the argument. We directed that the case should be reargued before seven justices so that those questions could be considered. The matters raised by the court included the correctness of Zurichs concession that if their first argument failed they were contractually liable (subject to recoupment) for the whole loss. An alternative possibility was that the insurer was liable for a proportionate part of the loss as a matter of construction of the policy, whether Barker remained good law or not and even in England where the Compensation Act applied. Upon reargument, Zurich addressed the construction question but maintained its concession. It was supported in this line by the Association of British Insurers. Construction of the policy I turn first to the construction of the policy, partly because it is the natural starting point for any analysis of its effect, and partly because I do not accept the construction which the parties have adopted as their premise. The six annual policies written by Midland were issued between 1982 and 1988. At that time, Fairchild, the Compensation Act and their legal progeny lay well into the future. These developments have greatly increased the potential liability of employers to employees whom they have wrongfully exposed to asbestos but that, as everyone can agree, is an ordinary hazard of liability insurance. The policies respond to the liability incurred by the insured in the course of the employment of its employees as the law may from time to time determine it to be, whether or not that liability would have been anticipated at the time that the contract of insurance was made. That, however, is not the problem with which we are presently concerned. We are concerned with the construction of the policies themselves. They cannot be construed on the footing that the parties were contracting by reference to the extraordinary legal problems to which Fairchild and its progeny have given rise. In Philips Electronique Grand Public SA v British Sky Broadcasting Ltd [1995] EMLR 472, Sir Thomas Bingham MR observed at paras 481 482: The courts usual role in contractual interpretation is, by resolving ambiguities or reconciling apparent inconsistencies, to attribute the true meaning to the language in which the parties themselves have expressed their contract. The question of whether a term should be implied, and if so what, almost inevitably arises after a crisis has been reached in the performance of the contract. So the court comes to the task of implication with the benefit of hindsight, and it is tempting for the court then to fashion a term which will reflect the merits of the situation as they then appear. Tempting, but wrong. it is not enough to show that had the parties foreseen the eventuality which in fact occurred they would have wished to make provision for it, unless it can also be shown either that there was only one contractual solution or that one of several possible solutions would without doubt have been preferred. Each Midland policy recited that the insured had applied for insurance and had paid or agreed to pay the premium as consideration for such insurance during the period stated in the Schedule or for any subsequent period for which the Company shall have accepted the premium required for renewal of this policy. The insuring clause provided: If any person under a contract of service or apprenticeship with the Insured shall sustain any bodily injury or disease caused during any period of insurance and arising out of and in the course of his employment by the Insured in the business above mentioned, the Company will indemnify the Insured against all sums for which the Insured shall be liable in respect of any claim for damages for such injury or disease settled or defended with the consent of the Company. The Company will in addition pay claimants costs and expenses and be responsible for all costs and expenses incurred with the consent of the Company in defending any such claim for damages. The insuring clause makes explicit what would be implicit in any contract of liability insurance written on an occurrence basis for a limited period. The occurrence is not the mere exposure of the victim to asbestos. It is the sustaining of bodily injury or disease caused during any period of insurance. The indemnity extends to the insureds liability for damages for such injury or disease, ie injury or disease caused during the period of insurance. The insurance is expressed to apply only to liability in respect of any injury or disease caused in Great Britain, Northern Ireland, the Isle of Man and the Channel Islands, and to injury or disease sustained by employees temporarily employed elsewhere under a contract of service or apprenticeship entered into in one of those jurisdictions. A liability policy responds to the specified liabilities of the insured, but only subject to any overall limitations of the policy. One of these limitations is the period of insurance, which is a fundamental feature of any such policy. The whole of the insuring clause depends upon the assumption that it is possible to assign the time when an injury or disease was caused to a given period which either is or is not within the period of insurance. Either the damage will be divisible, in which case parts of it may have been caused in different periods and must be divided between those periods, or it will be indivisible, in which case it will have been caused in a single period. As the opening recital reminds us, the period of insurance is a critical element of the ex ante assessment of the risk on which the premium is based. Insurance for any further period is dependent on renewal and the payment of a further premium. It may also (although not in this policy) be critical to the application of a deductible or an aggregate annual limit or excess. In addition, the attribution of loss to particular years is likely to have a significant effect on an insurers reserving and his reinsurance. In the English case law the point has commonly been made in the context of reinsurance. In Municipal Mutual Insurance v Sea Insurance Co Ltd [1998] Lloyds Rep IR 421, a port authority was insured against liability for (among other things) damage to property in its custody. Damage was done to equipment stored with it by a succession of independent acts of vandalism over a period of 18 months. It was impossible to differentiate between one act of vandalism and another, and the port authority was held to be entitled to aggregate all of them and to make a single claim against its insurer for the whole. The insurer was reinsured under successive facultative annual reinsurances, on terms which were back to back with the direct insurances and contained a standard follow clause (to follow their settlements). This gave rise to difficulty when the claim was passed on as a single claim to the reinsurers, because the 18 month period when the damage was done extended over the periods covered by three successive annual reinsurance policies written by different insurers, each of which provided for a substantial excess. The insurers attempt to make a single aggregate claim on one reinsurance policy was rejected by the Court of Appeal. Hobhouse LJ, giving the only reasoned judgment, said at paras 435 436: it was incumbent upon the judge to recognise and give effect to the essentially annual character of each reinsurance contract. Applying the wording of the original policy to each reinsurance contract it is necessary to ask whether or not the relevant physical loss or damage arose during the relevant period of cover. The judge came to the surprising conclusion that each reinsurance contract covered liability in respect of physical loss or damage whether or not it occurred during the period covered by the reinsurance contract and he went on expressly to contemplate that the same liability for the same physical loss or damage might be covered under a number of separate contracts of reinsurance covering different periods. This is a startling result and I am aware of no justification for it. When the relevant cover is placed on a time basis, the stated period of time is fundamental and must be given effect to. It is for that period of risk that the premium payable is assessed. This is so whether the cover is defined as in the present case by reference to when the physical loss or damage occurred, or by reference to when a liability was incurred or a claim made. Contracts of insurance (including reinsurance) are or can be sophisticated instruments containing a wide variety of provisions, but the definition of the period of cover is basic and clear. It provides a temporal limit to the cover and does not provide cover outside that period; the insurer is not then on risk. It will be appreciated that the judge's suggestion that there could or should be contribution between those signing the different slips for the different years is likewise radically mistaken. In Wasa International Insurance Co Ltd v Lexington Insurance Co [2010] 1 AC 180, Lexington had insured an aluminium manufacturer for a single period of three years between 1977 and 1980 against property damage. The insured incurred large liabilities for environmental clean up costs. The clean up costs were necessitated by industrial pollution occurring since the early 1940s. It claimed indemnity for the entire loss from each successive insurer by whom they had been insured against property or liability risks between 1956 and 1985, including Lexington. The claim was heard in Pennsylvania under Pennsylvania law. The courts there held that each insurer was jointly and severally liable for all damage which was manifest during their period of insurance irrespective of when it occurred. This meant substantially all the pollution damage attributable to industrial operations not only during the period of insurance but over the previous three decades. Lexington settled with the aluminium company on that basis. The reinsurance was on the same terms as the original as to period and coverage. It also contained a follow the settlements clause. But it was governed by English law, under which liability would have been limited to damage caused during the period of insurance, whereas the Pennsylvania court applied its own law under which no such limit applied. The argument for Lexington was that the Pennsylvania courts had decided that the pollution damage occurring over the whole period was insured under the 1977 1980 policy and that the reinsurance, which was on the same terms save as to the proper law, must respond on a like basis. The House of Lords rejected this contention. They held that, notwithstanding the ordinary presumption that reinsurance was back to back with the underlying insurance, the reinsurers liability was limited to damage caused between 1977 and 1980. The leading speeches were delivered by Lord Mance and Lord Collins of Mapesbury. Lord Mance said, at paras 40 41: 40. Viewing the reinsurance through purely English law eyes, it cannot therefore be construed as a contract to indemnify Alcoa in respect of all contamination of Alcoa sites, whenever caused or occurring, provided that part of such contamination manifested itself or was in being during the reinsurance period. That would involve reinsurers in an unpredictable exposure, to which their own protections might not necessarily respond. It would mean that the same exposure would arise, even if they had granted the reinsurance for a shorter period than the three year period matching the original since the original itself would, even if in force for only one year, have had effectively the same exposure as that for which the Washington Supreme Court held it answerable. Under the approach taken by the Washington Supreme Court, reinsurers must have incurred liability (in practice probably up to the reinsurance limits), as soon as they wrote the reinsurance. The retention must likewise have been exhausted before the reinsurance period began, and cannot have fulfilled any object of introducing an element of discipline into insurers' handling of the insurance. These represent as fundamental and surprising changes in the ordinary understanding of reinsurance and of a reinsurance period as those to which Hobhouse LJ was referring in the Municipal Mutual case [1998] Lloyd's Rep IR 421. 41. The reference in the reinsurance slip to the retention as subject to excess of loss &/or treaty R/I is a reminder that an insurance and reinsurance such as the present are likely to be part of a larger programme of protections. Excess of loss reinsurance is underwritten on either a losses occurring or risks attaching basis: Balfour v Beaumont [1984] 1 Lloyd's Rep 272. In other words, it is fundamental that such a reinsurance will respond in the one case to losses occurring during the reinsurance period, in the other to losses occurring during the period of policies attaching during the reinsurance period. To treat excess of loss policies as covering losses through contamination occurring during any period, so long as some of the contamination occurred or existed during the reinsurance period, would be to change completely their nature and effect. Lord Collins said, at para 74: 74. In English law, where an insurance or reinsurance contract provides cover for loss or damage to property on an occurrence basis, the insurer (or reinsurer) is liable to indemnify the insured (or reinsured) in respect of loss and damage which occurs within the period of cover but will not be liable to indemnify the insured (or reinsured) in respect of loss and damage which occurs either before inception or after expiry of the risk. As Lord Campbell CJ said in Knight v Faith (1850) 15 QB 649, 667: the principle of insurance law [is] that the insurer is liable for a loss actually sustained from a peril insured against during the continuance of the risk. Lord Brown of Eaton under Heywood, concurring with Lord Collins, pointed out at para 15 that if Lexingtons argument were correct, the reinsurers would have incurred the same liability if they had been on risk for only three months instead of three years: Given the fundamental importance under English law of the temporal scope of a time policy, I find it impossible to construe the reinsurance contracts in the way contended for. Reinsurance is not an insurance on liability, but on the original risk. In Municipal Mutual the original risk was the insureds liability for property damage and in Wasa it was the property damage itself. But the principle stated in them is the same, and it is of general application, as Hobhouse LJ pointed out. The courts are bound to give effect to the contractual limitations on the insurers liability. In particular, they are bound to give effect to the chronological limits of the risks covered, and to those provisions of the contract that operate by reference to the insurance period. The question on this appeal is how the terms of a chronologically limited policy are to apply to the liability resulting from the decision in Fairchild and the Compensation Act 2006. The objection to construing the Midland policies in this case as covering the damage caused at any time during the 27 years in which Mr Carr was exposed to the risk of contracting mesothelioma is the same as the objection of the Court of Appeal in Municipal Mutual and the House of Lords in Wasa to the corresponding arguments in those cases. The consequences are both commercially absurd and entirely inconsistent with the nature of annual insurance. The longer an employee is exposed to asbestos, the greater the risk of his contracting mesothelioma at some stage in his life. The result of IEGs argument is that under the contract the financial consequences for the insurer of writing the contract for a single year are the same as the financial consequences of writing the risk for the full 30 years, although he only receives a single years premium in the former case and 30 years premium in the latter. Indeed, the consequences would be the same even if the insured had been held covered for a time on risk premium for just a week or two while an unsuccessful attempt was made to agree terms. This entirely severs the functional connection between premium and risk. The employer for his part would obtain cover in respect of those whom he employed and exposed to asbestos particles in the period of cover, notwithstanding that for the rest of their working lives he elected to insure with others, or indeed elected not to insure at all. On that footing, the insurer assumes a liability of indeterminate duration notwithstanding that he expressly limited his liability to a single year. The indeterminate duration of the liability would extend both backwards and forwards. Thus an insurer who wrote a policy for, say, the first year of compulsory insurance, 1972, for an employer who had exposed its employees to asbestos particles for the previous half century and continued to do so, would assume liability for the entire accumulated legacy of exposure in the case of all employees on its payroll at the inception of the policy however far back the exposure of those employees extended. An insurer who insured the employer for a single year but refused to renew because of unfavourable claims experience or an increase in the risk would nevertheless remain liable in respect of the exposure of existing employees for an indefinite period into the future without payment of any further premium. Moreover, the insurer of a single year would have to pick up the tab for every other insurer who was on risk over an indeterminate period, although he had assumed a liability which was not co ordinate with theirs because they covered distinct periods. It also would mean that where the terms of successive policies were different, for example as to the excess or the limit, the insured could select a policy and spike the whole of the loss into the period covered by it. In the course of his judgment in the Court of Appeal, Toulson LJ observed that awarding less than the whole loss against any one insurer would deprive the insured of the insured coverage for which it paid. This observation seems to me to be the reverse of the true position. An employer who has paid a single years premium has not paid for 27 years of cover, which is what the decision of the Court of Appeal gives him. I understand every member of this court to be agreed that these consequences are unacceptable. As Lord Mance points out at para 40 of his judgment, the insurance was placed on the basis that a particular liability or loss would fall into one, not a series of separate periods. If an insured wanted complete cover, it would have to maintain it for all such periods. At para 43, he draws attention to the consequences which I have summarised above, and describes them as contrary to principle and anomalous. He is, with respect, plainly right to do so. These consequences are not just remarkable in themselves, but are directly inconsistent with the language of the Midland policies and the fundamental characteristics of insurance. This is not because any of the elements of liability, such as causation or damage, is divisible by time. Plainly they are not. It is because once the insured has proved each of those elements, he must still show that the occurrence fell within the chronological limits of the policy. If a particular result is inconsistent with the nature of insurance, and with the basis on which annual insurance is placed, there must be the strongest possible presumption that it was not intended, in the absence of clear language showing that it was. To explain why IEGs submission is mistaken, it is first necessary to differentiate between the legal basis of an employers liability to his employee and the legal basis of the insurers liability to the employer. At common law, the Dingle principle is that if several people tortiously contribute by independent acts to the same damage, they are all jointly and severally liable for the whole of the resulting damage. In Barker, the Court of Appeal and Lord Rodger in his dissenting speech in the House of Lords likened this state of affairs to the situation where several employers successively exposed the same victim to the risk of contracting mesothelioma. The majority of the House rejected that analogy, but the effect of section 3 of the Compensation Act was to reinstate it. The result is that each employer is contributing to the risk all the time, and is therefore incurring liability all the time. This makes some sense as between successive employers who are guilty of a continuous tort. However, the same logic cannot be applied as between successive insurers. Insurers are not wrongdoers. They have not contributed to any tortiously inflicted damage. The principles on which they are liable to indemnify their insured are not affected by the Compensation Act. Their liability depends not on common law or statutory concepts of culpability but on the liability that they have agreed to assume by contract. Although they have contracted to indemnify the insured in respect of his liability, they have done so on terms which require the assignment of causation to a contractual period and limit their liability to that period. This raises a problem which is, essentially, not legal but factual. The Fairchild principle is the laws response to the factual certainty that the disease was caused during the period of exposure combined with a complete uncertainty about when. If the assignment of causation to a particular period of coverage is scientifically impossible, then one solution would be for the law to say that the insured has not proved his case, as Lord Phillips would have held in Trigger. The alternative, once that is rejected, is to devise a mode of assigning causation to a particular period of time which is the closest possible surrogate for the real thing. The majority in Trigger adopted the latter solution, holding that any period of tortious exposure to the risk of contracting mesothelioma was enough to establish that the employer had caused the disease if it subsequently developed. The employers liability insurer was liable on that basis. The fallacy of IEGs argument is that it assumes that because any period of tortious exposure to the risk of contracting mesothelioma is enough to establish causation of the disease, it must follow that the disease was successively caused in every period of exposure. But that is conceptually impossible. Mesothelioma is caused only once. Once the process by which it develops has been initiated, subsequent further exposure to asbestos will not aggravate the victims condition or increase the loss. Pursuing the example of an employee exposed to asbestos particles for 30 years, let us assume that a different insurer is on risk in each year of exposure. If IEG is right, each insurer is liable for the entire loss in respect of an employee exposed to asbestos in his year who subsequently contracts mesothelioma, subject only to the limitation that the insured cannot recover more than an indemnity. By the same token, if the same insurer was on risk throughout the period of exposure, that insurer would be liable for the entire loss in each year, subject to the same limitation. But this makes no sense. It is conceptually possible for an insurer to be liable on the footing that there is a chance that the disease was caused in any year and that that should be enough to establish the necessary causal link. It is not conceptually possible for an insurer to be liable on the footing that the disease was actually caused in every year. It is only when one aggregates every successive period that the chances add up to 100%. IEGs answer to this is that because for the purposes of the insuring clause Trigger equates exposure to the risk with causation of the disease, it follows from the fact that the risk operated continuously throughout the period of exposure that the disease was continuously caused throughout the period of exposure. Therefore, it is said, causation of the disease is at one and the same time (i) a single indivisible occurrence, resulting in the entire claim falling into a single policy year, and (ii) a continuing occurrence extending over every policy year and equally efficacious in causing the disease in each one. I would be reluctant to assume that any judicial decision was authority for a contradiction in terms, and I do not think that Trigger is authority for this one. The effect of Trigger is that the insurers liability is triggered in each insurance year during the period of exposure. This is not because the insurance is against the exposure to the risk, a proposition which the court was at pains to reject in Trigger, just as the House of Lords had previously rejected it in Barker. Nor is it because the disease was actually caused in each insurance year, which is logically impossible and in any event ex hypothesi unknowable. It is because exposure to the risk is the closest surrogate that can be devised for determining when the disease was caused. This is the meaning of the weak or broad causal link to which Lord Mance referred at para 74 of Trigger. The link is, as he put it, to exposure which may but cannot be shown on the ordinary balance of probabilities to have played a role in the actual occurrence of the disease. The theory that an insurer is liable in respect of any year of insurance when the employee was exposed to the risk of contracting mesothelioma is a perfectly satisfactory answer to the question whether the insurer is liable at all, which was the only relevant question at issue in the Trigger litigation. But it cannot be applied without modification when the question is how much of the loss is attributable to particular years. If, as Trigger teaches, the insurers liability is triggered in each policy year, the rational response of the law is not to assign the whole of that loss to a policy year of the insureds choice. That would be to assume that the whole loss was caused in that year, whereas the law proceeds from the premise that we cannot know that. The rational response is that the loss must be prorated between every policy year during which the insured employer exposed the victim to asbestos. In my opinion, once one rejects the conclusion that the insurer is not liable at all, proration on that basis is the only way of giving effect to the overriding requirement of each annual policy that the liability should be assigned to policy years. If exposure to the risk of contracting mesothelioma is equated with causation, the natural consequence is that the resultant liability falls to be apportioned to policy years according to the duration and intensity of the exposure. What is being prorated as between the insurer and the employer is the employer's liability, not the indivisible harm of the mesothelioma itself. The chances of contracting mesothelioma, as Lord Hoffmann observed in Barker, are infinitely divisible, even if mesothelioma itself is not. This conclusion does not, as it seems to me, require words to be read into the policy, any more than the weak or broad test of causation adopted in Trigger required words to be read into the policy. It simply involves, as Trigger involved, construing the words caused during any period of insurance in the light of the terms of the policy as a whole and applying them to an insured liability with the unusual legal incidents of an employers liability for mesothelioma. I can deal very shortly with the words all sums in the insuring clause, on which Aikens LJ relied to support his conclusion. The relevant phrase is not all sums but all sums for which the insured shall be liable in respect of any claim for damages for such injury or disease, ie for injury or disease caused during any period of insurance. The insurance does not cover all sums for which the insured may be liable, but only those which fall within the chronological limits of the risk which the insurer has assumed. I have concentrated on the case where there is a single culpable employer whose operations are the sole relevant source of exposure to asbestos particles, because those are the facts of the present case. But there is no particular difficulty in applying the same principle to cases where there are successive tortfeasors or successive sources of exposure. The liability of the employer to the victim is apportioned to the insurer according to the proportion which its period on risk bears to the whole period during which that employer has tortiously exposed the victim to asbestos. If the insured employer is jointly and severally liable to the victim under section 3 of the Compensation Act with earlier employers who exposed the same victim to asbestos, that liability will form part of the liability which falls to be prorated between his successive insurers or between them and himself in respect of periods of non insurance. If the insured employer is insured throughout the period during which he exposed the victim to asbestos, the insurers will be liable for their respective proportions of 100%. Likewise, if there is another source of exposure to asbestos (for example ambient environmental asbestos) which were to be held to reduce the insured employers liability, the liability passed on to his insurer will be correspondingly reduced, but if not, not. United States Authority This conclusion, which appears to me be a logical application of the insuring clause to the kind of liability which arises in this case, derives some support from the rich jurisprudence of the United States, where similar questions have frequently come before the courts in the context of asbestosis and environmental pollution claims. Insurance is governed by state law and there are, perhaps inevitably, significant differences of approach in different state jurisdictions. In the celebrated case of Keene Corporation v Insurance Company of North America (1981) 667 F 2d 1034 the United States Court of Appeals for the District of Columbia (applying the laws of Delaware, New York, Pennsylvania, Connecticut and Massachusetts) held that either exposure or manifestation of the disease would make the insurer liable, and that each insurer was jointly and severally liable for the whole loss. The courts decision on the latter point was endorsed by Toulson LJ in his judgment in the Court of Appeal in the present case: see para 42. It was based mainly on the reasonable expectations of policyholders, a consideration which, except as background to the construction of the policy, does not have the significant place in English insurance law as it has in many jurisdictions of the United States. So far as it was based on the language of the policy at all, the imposition of joint and several liability in Keene was based on the expression all sums which the insured shall become legally obligated to pay as damages because of bodily injury: see note 20 (emphasis added). I have given my reasons for regarding the corresponding words as inconclusive in the context of the Midland policies. So far as Keene is authority for a triple or continuous trigger in cases about insurers liability for latent industrial diseases, it has been widely followed in other jurisdictions of the United States. But so far as it imposes joint and several liability on successive insurers, it has not met with universal acceptance, and major insurance jurisdictions have rejected it. In Insurance Company of North America v Forty Eight Insulations Inc (1980) 633 F 2d 1212, the Sixth Circuit Court of Appeals applied the laws of Illinois and New Jersey to a dispute about the allocation of a loss among successive insurers and the insured itself (in respect of periods of self insurance). The court construed product liability policies in respect of bodily injury as covering latent diseases on an exposure basis. The insured conceded that the insurers liability fell to be prorated according to time on risk, leaving them with a rateable part representing the period of exposure when they were uninsured. The issue was, however, argued out on the question whether the same rule applied to defence costs, which the employer did not concede. By a majority, the court ordered the proration of the defence costs, observing at para 73: In an underlying asbestosis suit, the plaintiff must show that Forty Eight's products injured him in order to be able to maintain a cause of action against Forty Eight. Under Borel, Forty Eight would be jointly and severally liable along with the other asbestos manufacturers: 493 F 2d at 1094 96. However, in allocating the cost of indemnification under the exposure theory, only contract law is involved. Each insurer is liable for its pro rata share. The insurer's liability is not joint and several, it is individual and proportionate. Accordingly, where an insurer can show that no exposure to asbestos manufactured by its insured took place during certain years, then that insurer cannot be liable for those years. The reason is simple: no bodily injury resulting from Forty Eight's products, took place during the years in question. The same thing would be true if an insurer could show that a worker used an effective respirator during certain years. Again, no bodily injury would have taken place. In my view, this analysis of the reason why the compensation element of the claim falls to be prorated cannot be faulted, although for reasons which I shall explain I do not think that it can be applied to defence costs. In Owens Illinois Inc v United Insurance Company (1994) 138 NJ 437, another product liability insurance case, the Supreme Court of New Jersey reached a similar conclusion on the assumption that the insurers liability was continuously triggered throughout the period of exposure, but rejected the solution proposed in Keene that each insurer on risk during that period was liable for the entire loss. Instead, it proposed a complex system of proration. At p 468, the court observed: The occurrence clauses undoubtedly contemplated indemnity for provable damages incurred by the policyholder because of injury that occurred during the policy period. The continuous trigger theory coupled with joint and several liability is premised on a tenuous foundation: that at every point in the progression the provable damages due to injury in any one of the years from exposure to manifestation will be substantially the same (the collapsed accordion). As we have seen, our law has been developing in a different manner. The court found little assistance in the language of the contract, but concluded that for reasons essentially of policy and practical efficacy, proration was the appropriate solution. It was particularly concerned with the anomaly that the Keene solution placed an insured with insurance for a small part of the period of exposure in the same position as one with insurance for all of it. At p 473, the court said: the Keene rule of law reduces the incentive of the property owners to insure against future risks. Recall the circumstances in the final three years. Assuming the availability of insurance, a principle of law that would act as a disincentive to the building owners in the hypothetical might serve in the long run to reduce the available assets to manage the risk. O I's counsel counters that these are not correct assumptions about the way in which the real world responds. We cannot be sure that the policy will be effective. We believe, however, that the policy goal is sound. Finally, principles of simple justice cannot be entirely discounted. To rebut effectively the question posed in Forty Eight Insulations is difficult. Were we to adopt [the policyholder's] position on defence costs a manufacturer which had insurance coverage for only one year out of 20 would be entitled to a complete defence of all asbestos actions the same as a manufacturer which had coverage for 20 years out of 20. Neither logic nor precedent support such a result. And at p 479: Because multiple policies of insurance are triggered under the continuous trigger theory, it becomes necessary to determine the extent to which each triggered policy shall provide indemnity. Other insurance clauses in standard CGL policies were not intended to resolve that question. A fair method of allocation appears to be one that is related to both the time on the risk and the degree of risk assumed. When periods of no insurance reflect a decision by an actor to assume or retain a risk, as opposed to periods when coverage for a risk is not available, to expect the risk bearer to share in the allocation is reasonable. Estimating the degree of risk assumed is difficult but not impossible. Insurers whose policies are triggered by an injury during a policy period must respond to any claims presented to them and, if they deny full coverage, must initiate proceedings to determine the portion allocable for defence and indemnity costs. In Consolidated Edison Company of New York Inc v Allstate Insurance Company (2002) 98 NY 2d 208, a similar issue arose in relation to a claim under a policy for environmental pollution liability. The assured argued for joint and several liability on the part of all insurers during the period when the pollutants were being released into the ground, because of the difficulty of assigning the damage to any one period. Rejecting this argument, the New York State Court of Appeals said, at p 224: Con Edison wants to combine this uncertainty based approach, which implicates many successive policies, with an entitlement to choose a particular policy for indemnity. Yet collecting all the indemnity from a particular policy presupposes ability to pin an accident to a particular policy period (see Sybron Transition Corp, 258 F 3d at 601; Owens Illinois, 138 NJ at 465, 650 A 2d at 988 989). Although more than one policy may be implicated by a gradual harm (see eg McGroarty v Great Am Ins Co, 36 NY 2d 358, 365), joint and several allocation is not consistent with the language of the policies providing indemnification for all sums of liability that resulted from an accident or occurrence during the policy period (see Olin Corp, 221 F 3d 307, 323). Pro rata allocation under these facts, while not explicitly mandated by the policies, is consistent with the language of the policies. Most fundamentally, the policies provide indemnification for liability incurred as a result of an accident or occurrence during the policy period, not outside that period (see Forty Eight Insulations, 633 F 2d at 1224). Con Edison's singular focus on "all sums" would read this important qualification out of the policies. Proration of liability among the insurers acknowledges the fact that there is uncertainty as to what actually transpired during any particular policy period (see Sybron Transition Corp, 258 F 3d at 602). Recently, in State of California v Continental Insurance Company (2012) 55 Cal 4th 186, 198 (and note 4), the Supreme Court of California noted that proration had been adopted by at least 12 states (Colorado, Connecticut, Kansas, Kentucky, Louisiana, Massachusetts, Minnesota, New Hampshire, New Jersey, New York, Utah and Vermont), while Keene had been followed on this point in at least six states in addition to California itself (Delaware, Indiana, Ohio, Pennsylvania, Washington and Wisconsin), generally on account of the all sums language of the policy. Policy considerations Fairchild and Barker were both cases in which legally unconventional rules for establishing liability in tort were adopted for reasons of policy. In Trigger, there was clearly a significant policy element behind the majoritys adoption of a weak test of causation in the construction of the insuring clause, in place of the austere logic of Lord Phillips, who would have held that employers liable on the Fairchild basis were not insured at all. It is therefore natural to ask whether a similar approach may not justify a rule which would make each insurer liable in full irrespective of the period for which he was on risk, so as to ensure that whatever happens the employee is protected. This is essentially what the victim support groups submit. Judges are not always candid about the broader considerations which lead them to prefer one view of the law to another. But the desire to ensure an outcome which protects victims of occupational mesothelioma has had such a strong influence on recent case law, that its relevance to the present issues is a question that needs to be confronted. There are two reasons why the employee might be unable to recover damages for contracting mesothelioma resulting from his tortious exposure to asbestos. One is that his employer has insured with an insurer who subsequently becomes insolvent. The other is that his employer has in breach of his statutory obligation failed to insure at all. The employee has no reason to be concerned with either problem if his employer is solvent and able to meet his liabilities from his own resources. But both are a potential problem if, in addition, his employer is insolvent. It is clear that the main reason for holding an insurer who was on risk at any time during the period of exposure liable for the entire loss is that this obliges that insurer to bear the risk of the absence of effective insurance in other years in which it was not on risk. It is therefore necessary to ask what conceivable policy could justify that? The Fairchild principle is not addressed to the problems of insurer solvency or non insurance. It is addressed to the scientific impossibility of ascertaining when the insured occurrence happened. The Midland policies were written in a standard form which by its express terms applies only to injury or disease caused in Great Britain, Northern Ireland, the Isle of Man and the Channel Islands or to employees temporarily employed elsewhere under a contract entered into in one of those jurisdictions. It is therefore clear that it was designed to satisfy the employers statutory obligation to insure under the Employers Liability (Compulsory Insurance) Act 1969. It is self evident that that Act was intended to protect employees with claims against their employers rather than the employers themselves. We can deduce from this that the Act of 1969 should predispose a court to find that that coverage for occupational injury and disease has been provided, as indeed this court held that it was in Trigger. But there is nothing in the policy of the Act which is inconsistent with insurance being obtained through annual policies, as it normally has been throughout the history of this market. And nothing which assumes that coverage will be provided beyond the express chronological limits of the policy simply because there is no effective insurance in place beyond those limits. On the contrary, the Act envisages that there will be continuous cover with authorised insurers. Insurers have deep pockets, but that in itself cannot justify imposing on them a liability which they have not agreed. Nor is there any need to pick the pockets of the insurers in this way, since the employee is amply protected by various statutory schemes from the risk of being unable to recover. The Policyholders Protection Act 1975 introduced a statutory scheme of compensation for policyholders of insolvent insurers. It protected business policyholders in full in respect of risks subject to compulsory insurance. These arrangements have since been replaced by the wider terms of the Financial Services Compensation Scheme introduced by section 213 of the Financial Services and Markets Act 2000. The successive schemes have all been funded by statutory levies from the insurance industry. This legislation does not protect the employee in respect of loss attributable to a period for which there was no insurance in place. But such protection has now been conferred on eligible persons diagnosed on or after 25 July 2012 by the Mesothelioma Act 2014. The Act provides for a scheme to be established by secondary legislation under which the victim or his dependants will be entitled to specified payments from a statutory fund if they are unable to bring an action for damages in respect of the disease against any employer of the person or any insurer with whom such an employer maintained employers liability insurance (because they cannot be found or no longer exist or for any other reason): section 2(1)(d). Section 18(3) provides that for this purpose the scheme may specify circumstances in which a person is, or is not, to be treated as able to bring an action for the purposes of section 2(1)(d) . The scheme was established by the Diffuse Mesothelioma Payment Scheme Regulations 2014 (SI 2014/916). It provides for the payment of specified lump sums to victims or their dependents, the amount of which varies with the age of the victim upon diagnosis. The power conferred by section 18(3) has been exercised by extending eligibility to any case in which the employer falls within the 1930 Act (ie is insolvent) and no other employer or insurer can be found or exists against whom the person can maintain an action for damages: regulation 7(1)(b) (emphasis added). There are potential issues about the criteria of eligibility in section 2 of the Act, in a case where the employee is entitled to proportionate amounts in respect of different years and there is insurance for some of those years but not for others. Like the Financial Services and Markets Act scheme, the cost of the fund is met by a levy on the United Kingdom insurance industry. The combined effect of these schemes is that the employee is protected against the insolvency of an insurer or the absence of insurance, in any case where his employer is unable to meet his liabilities. As the rules governing the Financial Services and Markets Act scheme presently stand, if an insurer on risk in one year were required to pay the entire loss, thus discharging the liability of insolvent insurers on risk in other years, that insurer would to that extent be entitled to claim against the scheme: see Prudential Regulation Authority: Handbook, Compensation Rules, para 4.4.3. But if an insurer on risk in one year were required to make good the failure of the employer to insure at all in other years, that insurer would have no equivalent right to recover from the scheme created under the Mesothelioma Act 2014. Accordingly, the result of imposing on him a liability to pay the entire loss is to cast the entire burden of the insurance gap on him when the scheme of the Act of 2014 is to spread it across the insurance industry as a whole. Defence costs That leaves the question whether the right to prorate the insureds loss across the period of exposure applies also to defence costs. The insuring clause provides, immediately after the principal coverage provision: The Company will in addition be responsible for all costs and expenses incurred with the consent of the Company in defending any such claim for damages. The insurer is liable under this provision for costs and expenses incurred with its consent in defending any such claim for damages, ie a claim for damages for disease caused during any period of insurance. Similar language has been held in some of the jurisdictions of the United States which prorate the principal liability to require the proration of the defence costs as well: Insurance Company of North America v Forty Eight Insulations Inc (1980) 633 F 2d 1212. I have some sympathy with the instinct behind this view, but the difficulty about it is that the tests are not the same. The insurers liability for the compensation element of the claim falls to be prorated according to time on risk because on a proper analysis it relates only in part to the period for which the risk was insured. The insurers liability for the defence costs is different. Unless there was some severable part of the defence costs that can be specifically related to a period when the insurer was not on risk, the whole of the defence costs had to be incurred to meet that part of the claim which was insured. The fact that it was also required to meet the uninsured remainder of the claim is irrelevant. The most that the insurer can say in this situation is that in funding the defence of a claim so far as it related to an insured period, it incidentally conferred a benefit on those who were potentially liable for the same claim in respect of an uninsured period: ie other insurers and IEG in its capacity as self insurer. In New Zealand Forest Products Ltd v New Zealand Insurance Co Ltd [1997] 1 WLR 1237, the insured incurred costs in defending litigation in California against a number of parties only one of whom, a director, was insured against the relevant liability. The Privy Council held that the defence costs did not fall to be apportioned between the insured and uninsured defendants. So far as the defence costs were reasonably required to meet the defence of a party whose liability was insured, the insurer was bound to pay them. It did not matter that the expenditure also benefitted other parties whose liabilities were not insured. The principle is accepted by the insurers on this appeal, who concede that they are liable to pay the defence costs in full. That concession appears to me to be correct. It follows that as a matter of contract Zurich is contractually liable to meet the defence costs in full. The Guernsey angle In the Court of Appeal in the present case, Toulson LJ expressed the view that in the light of the subsequent developments in the law, Barker had become past history and was no longer good law even in cases (such as those arising in Guernsey) where the Compensation Act did not apply. I have arrived at the conclusion about the proration of contractual liability for compensation by reference to the terms and nature of the contract of insurance. The analysis would have been the same if Mr Carr had been employed in England. It is therefore strictly speaking unnecessary to address the question whether Toulson LJ was right about the current status of Barker. But in view of the fact that the point was fully argued, I will briefly summarise my reasons for thinking that he was wrong. The common law is not a series of ad hoc answers to particular cases, but a body of general principle by reference to which answers may be found. The Act of 2006 did not alter any principle of the common law. In the first place, it did not lay down the elements of liability. It assumed liability and regulated only the measure of recovery. Secondly, it applied only to mesothelioma cases, and then only to regulate the measure of liability in tort as between the tortfeasor and the victim. Thirdly, even in relation to mesothelioma, section 3(1) applied only where the responsible person incurred liability for materially increasing the risk. Liability is incurred on that basis only on the footing that the time at which the disease is caused is impossible to determine. As Lord Phillips pointed out in Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229, at para 70, the courts would be entitled to revert to the conventional approach of requiring proof of causation on the balance of probabilities if advances in medical science make this possible. In other words, the Act left the common law intact, but carved an exception out of it for mesothelioma. It follows that Fairchild as interpreted by Barker remains good law in those jurisdictions (such as Guernsey) where the Act does not apply, and remains good law as applied to those legal relationships (such as the contractual relationship between insurer and insured) to which it does not apply. In those cases to which Barker continues to apply, it stands as authority for the allocation of liabilities which at common law are several only. Equitable recoupment and redistribution This question arises only on the assumption that an insurer who is on risk for only part of the period of exposure is contractually liable to meet the whole of the compensation element of the employers claim or the whole of the defence costs. On that assumption, Zurichs argument is that insurers are entitled in equity (i) to redistribute the burden among other insurers who are liable in respect of the same amounts but in respect of different policy periods, and (ii) to recoup from the insured a pro rata part of the cost of meeting that liability in respect of periods when there was no insurance at all. As I have already explained, I consider that the assumption on which this argument arises, namely that an insurer on risk for only part of the period of exposure is contractually liable for the whole loss, is false. However, the question has a more general significance. If, as Zurich contend, there is a general right of contribution or recoupment (i) as between insurers and (ii) as between insurers and insureds in respect of periods of non insurance, that would provide an alternative way of rectifying the anomalies associated with holding the insurer liable for the entire loss, alternative that is to construing the policy as responding for only a pro rata part of the loss. As between insurers each of whom insured only part of the period of exposure but are liable (on this hypothesis) in full, I think it clear that there is a statutory right of contribution. Section 1(1) of the Civil Liability (Contribution) Act 1978 came into force on 1 January 1979, and applies to damage occurring after that date: see section 7(1). This has sometimes been questioned, for example by Friedmann, Double insurance and payment of anothers debt (1993) 109 LQR 51, 54. But I can see no principled reason for questioning it. Section 1(1) provides that a person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise). A contract of indemnity gives rise to an action for unliquidated damages, arising from the failure of the indemnifier to prevent the indemnified person from suffering damage, for example, in a liability policy by having to pay the third party claimant: Firma C Trade SA v Newcastle Protection and Indemnity Association [1991] 2 AC 1, 34 (Lord Goff of Chieveley). The class of persons liable in respect of any damage suffered by another may include those liable in contract, and there is no reason to limit it to those who have themselves caused the damage, as opposed to those who have assumed a contractual liability in respect of it. The question is therefore whether the damage for which successive insurers are liable is the same damage. As a matter of construction and on ordinary principles of insurance law, it is not. As I have said, successive insurers of liability on an occurrence basis do not insure the same liability. Each of them has contracted to indemnify the insured against an insured peril occurring in its own period on risk. In the case of an indivisible injury the liability of successive insurers is therefore alternative and not cumulative. However, on the footing that (contrary to my opinion) the law treats each insurer as liable for the whole loss in each period of insurance, then it must necessarily have been the same damage. Whether there would be a right of contribution in respect of liabilities arising before 1 January 1979 is a more difficult question. There has always been a right of contribution at common law in cases of double insurance. But double insurance normally requires that two or more insurers should be liable in respect of the same interest on the same subject matter against the same risks. On this ground, English law has hitherto declined to recognise that double insurance can exist as between insurers liable in respect of different periods even if the loss is the same: National Employers Mutual General Insurance Association Ltd v Haydon [1980] 2 Lloyds Rep 149; Phillips v Syndicate 992 Gunner [2004] Lloyds Rep IR 426. It would require some considerable development of traditional concepts of double insurance to accommodate a situation like the present one. In Australia, where there is no legislation corresponding to the 1978 Act, this development has occurred: see Albion Insurance Co Ltd v Government Insurance Office of New South Wales (1969) 121 CLR 342. Whether the law should develop in the same way in England is a question that I should prefer to leave to a case in which it is more central to the outcome and the arguments of the parties. The Act of 1978 will cover the great majority of cases that seem likely now to arise. What is in my view clear is that there cannot be an equitable right of recoupment as between the insurer and his insured in respect of periods when the latter was not insured. The reason is that unlike an insurers relationship with other insurers under a co ordinate liability for the same loss, his relationship with the insured is a contractual relationship. Its content has been determined by agreement, and a right of recoupment would be inconsistent with that agreement. If the insured is contractually entitled to the whole amount, there cannot be a parallel right of recoupment in equity on the footing that it is inequitable for the insured to have more than part of it. The basis of the suggested right of recoupment is that it is unjust for the insurer to have to bear the whole loss. But I do not understand by what standard it is said to be unjust when the parties have agreed that it should be so. It is no answer to this to say that the alleged right of recoupment arises outside the contract. Of course, a contractual right and an equitable right of recoupment are juridically different. But the question is not what is the juridical origin of the claim for recoupment, but whether it operates by reference to the contract. To that question, there is only one possible answer. The alleged right of recoupment arises only because the contract (on this hypothesis) provides for the insurer to pay the whole loss. It arises as a direct result of the payment of the contractual indemnity. Its purpose is to undo in part what the contract has done. Mr Edelman submitted that a right of recoupment would only reflect the contribution of the employer to the risk of years which the insurer did not insure. So it would. But that is because (on this hypothesis) the contract requires the insurer to pay in full notwithstanding the contribution of the employer to the risk in the years which were not insured. If that is the consequence of the parties agreement, I know of no legal doctrine which can do away with it. Equity does not mend mens bargains. It may intervene to avoid unconscionable bargains, or to give effect to the parties real intentions (for example when proprietary rights are conferred for a limited purpose such as security), or to provide remedies where those available at law are defective. But these are principled exceptions which depend on the unconscionability of allowing the law to take its course. There is nothing unconscionable about the performance of a contract of insurance according to its terms. In this respect, the principle on which equity acts is no different from that of the common law, even where the relevant common law claim is non contractual. Thus a contractual relationship may give rise to a parallel duty of care in tort, and the consequences of breach (for example as regards limitation or foreseeability) may be different. But any contractual provisions about the content of the duty must apply to both: Henderson v Merrett Syndicates Ltd [1995] 2 AC 145, 191, 193 194 (Lord Goff of Chieveley). And a claim for unjust enrichment, which is probably the closest analogue to the right of recoupment proposed in this case, will not be allowed where its effect is to alter the contractual allocation of risks: Pan Ocean Shipping Co Ltd v Creditcorp Ltd [1994] 1 WLR 161, 164 (Lord Goff). As Etherton LJ said in MacDonald Dickens & Macklin (a firm) v Costello [2012] QB 244, at para 23, in language which applies well beyond the domain of unjust enrichment with which he was concerned: The general rule should be to uphold contractual arrangements by which parties have defined and allocated and, to that extent, restricted their mutual obligations, and, in so doing, have similarly allocated and circumscribed the consequences of non performance. That general rule reflects a sound legal policy which acknowledges the parties' autonomy to configure the legal relations between them and provides certainty, and so limits disputes and litigation. Of course, this will not necessarily apply where the relevant contractual right is vitiated, for example by illegality, frustration or mistake, all of which give rise to well established grounds for restitution: see Lord Mances observations at paras 69 71. But this has no bearing on a case such as this is said to be, where a valid, lawful and effective contract requires the insurer to satisfy the whole liability notwithstanding that he accepted only a time limited part of it. It is I think beyond question that to require part of that amount to be repaid on the ground that its retention would be unjust is a reversal of the effect of the contract by operation of law, something which cannot be justified if the contract is valid, lawful and effective. Mr Edelman QC, who appeared for Zurich, submitted that in respect of periods when the employer was not insured, he could be regarded as self insured and his position as regards contribution assimilated to that of a true insurer. Even if this were correct, it would not displace contractual allocation of risk. But in my view it is not correct. The submission is founded mainly on the decision of the House of Lords in Lord Napier and Ettrick v Hunter [1993] AC 713, 730, which is said to be authority for the proposition that self insurance is a form of insurance. The House held that a Lloyds name was accountable to his subrogated stop loss insurer for recoveries which he had made from successful litigation against his managing agents. Under the terms of the stop loss policy, the name had agreed to bear the first 25,000 of loss. It was held that he was not entitled to apply the recoveries against the bottom 25,000 of loss, because recoveries are applied to insurers top down, starting with the insurer of the highest tranche of loss. Lord Templeman referred to the name (p 730E) as acting as his own insurer for the uninsured tranches. But this was a figure of speech. The point that he was making was that if the name had actually insured the bottom tranche of loss, the insurer of that tranche would have been entitled to nothing from the recoveries because the insurers of higher tranches would have exhausted them. The name, having agreed to bear the bottom tranche himself, could be no better off than an insurer of the bottom tranche if there had been one. Self insurance is non insurance. Even if for the purposes of subrogation the position of a person with an uninsured excess is similar to that of an insurer of that excess, it does not follow that it is similar for any other purpose, still less that such a person is himself an insurer. IEG cannot be regarded for the purposes of the Civil Liability (Contribution) Act 1978 as being liable to themselves in respect of the uninsured periods of exposure for the same damage for which their insurers are liable to them in other years. The real basis for the alleged right of recoupment is the intolerable consequences of holding an insurer liable for a loss sustained over many years irrespective of how long he was on risk. But the correct response to these consequences is for the courts to do what they normally do when one construction of a contract leads to absurd results. They reject it and prefer another which does not exhibit the same anomalies. The whole recoupment analysis is in my opinion a classic example of the problems associated with the adoption of special rules within the Fairchild enclave which differ from those that would follow from the application of ordinary principles of law. Third Parties (Rights Against Insurers) Acts 1930 and 2010 I do not propose to lengthen this judgment yet further by addressing the question whether, if there were a right of recoupment as between the insurer and the insured, it could be set off against the claim on the policy. If it could be set off, the employee of an insolvent employer, suing under the Acts of 1930 or 2010, would be no better off by having a contractual right to recover the entire loss under the policy. In my opinion, the question does not arise because he has no such contractual right. I will simply observe that this is another difficult question which arises only as a result of the discarding of orthodox principles of contractual interpretation in favour of special rules devised for special enclaves without regard to general principles. LORD NEUBERGER AND LORD REED: (agree with Lord Sumption) This appeal represents yet another demanding chapter in the difficult series of decisions of the House of Lords and Supreme Court in relation to an employers liability to a former employee, who was exposed to asbestos fibres during the course of his employment, and subsequently contracted mesothelioma, a disease which has been rightly described by other judges as hideous and dreadful. For ease of reference we will refer to such an employer and such a former employee as an employer and an employee respectively. The decisions start with Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32, which raised the question of an employers liability to an employee, who had also been exposed to asbestos dust when working for another employer. In that case, as explained by Lord Mance at paras 3 4 and Lord Sumption at paras 114 116 and 124 128 above, the House of Lords was faced with an unedifying choice between (i) applying well established rules of causation in tort and arriving at a thoroughly unpalatable decision, namely that neither employers negligence could be proved to have caused the disease, and (ii) extending the law of causation on an ad hoc basis, so that it was enough to prove that an employers negligence had materially increased the risk of contracting the disease, in order to achieve a tolerably fair outcome, namely that each employer was liable. The House elected for the latter course, and held that, in such a case, given that it was impossible to tell whether either employers breach of duty had caused the employee to contract the disease, each of the two employers should be held liable to the employee. To many people, that avowedly policy based decision, which is applicable to any disease which has the unusual features of mesothelioma (as described by Lord Sumption in paras 116 117) seemed, and still seems, not only humane, but obviously right. Indeed, there can be no doubt that it would have required an exceptionally hard headed (and, many people would say, hard hearted) approach to hold that neither employer was liable, which is what the application of established legal principle would have indicated. However, as subsequent decisions have shown, the effect of what was a well intentioned, and may seem a relatively small, departure from a basic common law principle by a court, however understandable, can lead to increasingly difficult legal problems a sort of juridical version of chaos theory. The problems stem from the fact that, unlike legislation, the common law cannot confine itself to a particular situation and deal with it in isolation from the remainder of the law; nor can it resolve problems on a purely pragmatic basis. It is a complex and extensive network of interconnected principles applicable to all situations falling within their scope. As Lord Nicholls of Birkenhead stated in Fairchild itself: To be acceptable the law must be coherent. It must be principled. The basis on which one case, or one type of case, is distinguished from another should be transparent and capable of identification. When a decision departs from principles normally applied, the basis for doing so must be rational and justifiable if the decision is to avoid the reproach that hard cases make bad law. (para 36). The creation of an ad hoc exception from established principles governing causation in order to provide a remedy to the victims of mesothelioma was, in the first place, likely to result in uncertainty as to the legal rationale of the exception (as distinct from the social policy of enabling victims of mesothelioma to obtain a remedy against negligent employers), and the consequent breadth of that exception. The rationale could not be merely the impossibility of establishing the cause of an injury, since such a wide exception to the general rule governing causation would destroy the rule (see, for example, the attempt to extend the exception to cases of medical negligence, narrowly defeated in Gregg v Scott [2005] 2 AC 176). As Lord Brown observed in Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229, para 186, the unfortunate fact is that the courts are faced with comparable rocks of uncertainty in a wide variety of other situations too, and that to circumvent these rocks on a routine basis would turn our law upside down and dramatically increase the scope for what hitherto have been rejected as purely speculative compensation claims. In the event, the rationale of the Fairchild exception continues to cause difficulty (as, for example, in Novartis Grimsby Ltd v Cookson [2007] EWCA Civ 1261). Secondly, the introduction of a novel test of causation in tort was bound, given the legal and commercial connections between different areas of the law, to give rise to a series of difficult questions and consequent uncertainty, as the ripples spread outwards. The first question which subsequently manifested itself was how the common law, having taken this step into the unknown, should allocate liability for damages as between two employers, each of whom had permitted an employee to be exposed to asbestos fibres. That question was addressed in Barker v Corus UK Ltd [2006] 2 AC 572, a decision analysed by Lord Sumption in paras 129 135. The pragmatic decision that each employer was responsible for a proportion of the damages but not for the whole created a further exception to established legal principles. Perhaps unsurprisingly, it was not unanimous, and, as Lord Sumption says, the reasoning is not easy to analyse. Indeed, it is not without interest that Lord Rodger disagreed with the majority as to the proper analysis of the reasoning in Fairchild. Parliament was unhappy with the decision in Barker, since it meant that, if an employer was insolvent, the employee might not recover that employers proportion of the damages. The decision was effectively reversed in short order by section 3 of the Compensation Act 2006. Unlike the two House of Lords decisions, section 3 of the 2006 Act was expressly limited to mesothelioma cases: a restriction which Parliament could impose, but the courts could not. The effect of section 3 is explained in para 136 by Lord Sumption. The next case to arrive at the Supreme Court in connection with employers liability to employees was Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229, a decision which has no direct part to play in the present appeal, although it involved a logical, if probably unanticipated, extension of what had by then been dubbed the Fairchild exception, in order to accommodate the existence of non tortious environmental exposure to asbestos. In his judgment, the decisions and reasoning in the judgments in Fairchild and in Barker were discussed by Lord Phillips, who described them in paras 45 and 52 as raising two conundrums in connection with causation, which needed to be solved. In the course of her concise judgment, Lady Hale in paras 167 168 referred to the decision in Fairchild as kick[ing] over the hornets nest. She added that she f[ound] it hard to believe that their Lordships there foresaw the logical consequence of abandoning the but for test. She also mentioned the possibility of overruling Fairchild, but said that Even if we thought it right to do this, Parliament would soon reverse us. On one view, that might have been regarded as the best of reasons for overruling Fairchild. Lord Brown in para 185 also expressed doubts whether those who decided Fairchild could have appreciated the full implications of their decision. Lord Mance put the same point at a rather higher level of principle in para 189, when he referred to the lesson of caution that the history may teach in relation to future invitations to depart from conventional principles of causation. At least to a reasonable degree of clarity, these three cases and the 2006 Act have established the extent of an employers liability for damages in relation to an employee who has been exposed to asbestos fibres in the course of his employment and has subsequently developed mesothelioma. Problems next arose in connection with the extent of the liability of insurers. The general position of insurers in law and in practice is summarised by Lord Sumption in paras 118 119. However, the way in which the law had developed in relation to mesothelioma claims by employees against employers raised problems of principle in relation to the liability of the employers insurers. Two such problems were decided by the Supreme Court in the so called Trigger litigation, Durham v BAI (Run off) Ltd [2012] 1 WLR 867, and they are explained by Lord Mance and Lord Sumption at paras 16 24 and 137 140 respectively. The conceptual difficulties thrown up by the decisions in Fairchild and in Barker were again demonstrated by the discussion in paras 63 66 of Lord Mances majority judgment in Trigger, and by the contrast between his reasoning and that of Lord Phillips, who dissented (and see per Lord Clarke in para 84). However, the position is still unclear in a case where an insurer insured an employer for only part of the period of a claimant employees employment, and the employer was either uninsured for the rest of the period, or was insured with an insurer who is now insolvent. It is that situation with which this appeal is concerned, and the problem is identified by Lord Mance in his paras 42 44 and by Lord Sumption in his paras 141 142. As Lord Mance goes on to explain in paras 44 46, three different approaches are suggested. The first is that adopted by the Court of Appeal; the second is that proposed by Lord Mance; the third is that proposed by Lord Sumption. We agree with Lord Mance and Lord Sumption that the Court of Appeals analysis cannot be supported. It seems to us that they were wrong to conclude that the common law, as laid down by the House of Lords in Barker, had been changed as a result of section 3 of the 2006 Act. The section changed the law in this country, because (save perhaps in extreme circumstances) Parliament can, by statute, override the common law as laid down by the courts. However, it is clear from the terms of section 3 that it was intended to deal with a specific and limited class of case, namely the liability to employees, who were exposed to asbestos fibres in the course of their employment and subsequently contracted mesothelioma. In those circumstances, it seems to us that section 3 cannot be said to have altered the common law: it simply superseded the common law in the circumstances in which it applies. That leaves the very difficult question as to which of the two approaches proffered by Lord Mance and Lord Sumption to prefer. The difficulty is compounded by the high quality and depth of reasoning in their two judgments. Further, it is interesting to note that each of these approaches has its adherents in other jurisdictions, as Lord Mance and Lord Sumption explain in paras 69 and 164 168 respectively. Lord Mances solution has a number of attractions. First, it is more in line with the Parliamentary approach as demonstrated by section 3 of the 2006 Act, because, unlike Lord Sumptions solution, it ensures that every employee whose employer was insured for any period of his employment, can look to any such insurer who is still solvent for full compensation. Secondly, unlike Lord Sumptions solution, it has been supported by one of the parties to this appeal: despite being raised by the court at a reconvened hearing, Lord Sumptions solution has not been adopted by either party. We suspect that these two points are not unconnected: the insurance market may fear that, if the court adopts the solution favoured by Lord Sumption, Parliament will intervene as it did following Barker. Indeed, such a concern may have been seen by some members of the court in Sienkiewicz as a reason for not reconsidering the decision in Fairchild. However, as a matter of principle, having rejected the contention that section 3 has changed the common law, it seems somewhat quaint (although, we accept, not logically inconsistent) to invoke section 3 as a reason for developing the common law in a certain way rather than another. Thirdly, Lord Mances solution represents a solution which is far closer to that which the London insurance market has worked out in practice. Fourthly, Lord Mances approach does not clash with any of the preceding decisions to which we have referred, while it is, we accept, arguable whether Lord Sumptions solution is consistent with the reasoning of this court in the Trigger litigation. Just as in Barker there was a division of opinion as to the reach of the reasoning in Fairchild so there is a difference in this case as to the reach of the reasoning in the Trigger litigation compare Lord Mance at paras 45 and 55 with Lord Sumption at paras 159 161. While, like so many points in this area, the issue is not easy, we agree with Lord Sumptions view. On the other hand, in favour of Lord Sumptions view, it seems to us rather remarkable for an insurance contract to be construed as rendering the insurer liable for the whole of an employees damages, where, for instance, the employee has been exposed to fibres for the whole of his 40 years of employment and the insurer in question has only provided cover for one of those years. (Or even for a temporary period of two weeks while the employer was considering whether to take out longer term cover.) As Lord Sumption explains, such an approach is inconsistent with the link between risk and premium which lies at the heart of a contract of insurance. Yet that is the basis of Lord Mances conclusion. Lord Sumptions solution, which involves a pro rata liability, produces no such anomalous result: in the example just given, the insurer would be liable for 1/40 of the employees damages. It is true that the apparently anomalous result in the example we have just mentioned is mitigated by Lord Mances view that the employer has to be treated as a self insurer for the 39 years of non insurance, so that the insurer can recover 39/40 of the damages it has to pay from the employer, provided the employer is solvent. While impressively reasoned in paras 56 78, Lord Mances view that an insurer could recover a contribution from the employer, his insured (but not set it off against his own liability to the employer under the insurance contract), seems to us to open up a dangerous seam of potential litigation, as an exception is made to another established principle, namely that the respective rights and liabilities of the parties to a contract are governed by their agreement. We appreciate that it can be emphasised that that aspect of Lord Mances analysis is strictly limited to cases within the Fairchild exception, or as Lord Hodge has put it, the analysis only applies within the Fairchild enclave. Enclaves are however notoriously difficult to police, and experience suggests that judicial attempts at restricting ratios may run into the same danger as when a court emphasises that a particular course is only to be taken in very exceptional circumstances. Once a principle is approved by a court (particularly, it may be said, this court), it is quite legitimate, indeed appropriate, for lawyers to invoke it and seek to apply it more generally, if it assists their clients case. And here, it may well be argued, this court is invoking a new and wide general equitable power, which is, to put it at its lowest, close to inconsistent with an express contractual term, in order to reconstitute a contractual relationship so as to achieve what it regards as a fair result in a purely commercial context. Lord Sumptions analysis, by contrast, turns simply on the interpretation of the relevant contract of insurance, and does not appear to us to have any unfortunate wider ramifications. Thus, Lord Sumptions analysis appears to us to do significantly less violence (and we think it probably does no violence) to established legal principles, whereas Lord Mances analysis accords more with current practice and what is likely to be the view of the legislature. We accept that the fact that we are in the Fairchild enclave is a reason for favouring what may be said to be the more practical solution. However, our preference is in favour of learning what Lord Mance in Sienkiewicz referred to as the lesson of caution that the history of the decisions of the House of Lords and Supreme Court to which we have referred may teach in relation to future invitations to depart from conventional principles, and agree with Lord Sumption. But we can readily appreciate why the majority of the court has formed the opposite conclusion. In conclusion, it seems to us that it is at least worth considering what lessons can be learnt from the history summarised in this judgment and more fully treated by Lord Mance and Lord Sumption. There is often much to be said for the courts developing the common law to achieve what appears to be a just result in a particular type of case, even though it involves departing from established common law principles. Indeed, it can be said with force that that precisely reflects the genius of the common law, namely its ability to develop and adapt with the benefit of experience. However, in some types of case, it is better for the courts to accept that common law principle precludes a fair result, and to say so, on the basis that it is then up to Parliament (often with the assistance of the Law Commission) to sort the law out. In particular, the courts need to recognise that, unlike Parliament, they cannot legislate in the public interest for special cases, and they risk sowing confusion in the common law if they attempt to do so. When the issue is potentially wide ranging with significant and unforeseeable (especially known unknown) implications, judges may be well advised to conclude that the legislature should be better able than the courts to deal with the matter in a comprehensive and coherent way. It can fairly be said that the problem for the courts in taking such a course is that the judges cannot be sure whether Parliament will act to remedy what the courts may regard as an injustice. The answer to that may be for the courts to make it clear that they are giving Parliament the opportunity to legislate, and, if it does not do so, the courts may then reconsider their reluctance to develop the common law. For the courts to develop the law on a case by case basis, pragmatically but without any clear basis in principle, as each decision leads to a new set of problems requiring resolution at the highest level, as has happened in relation to mesothelioma claims, is not satisfactory either in terms of legal certainty or in terms of public time and money. In the case of mesothelioma claims, there can be no real doubt but if Fairchild had been decided the other way, in accordance with normal common law principles, Parliament would have intervened very promptly. That may very well have been a better solution, but it can fairly be said that that observation is made with the wisdom of hindsight.

The present appeal is from Guernsey, where there is no equivalent of the 2006 Act. The common laws of England and Guernsey are agreed to be identical in this area. The principal issues are: (1) whether the reasoning in Barker still applies in Guernsey [8], and means that an employers liability insurer covering an employer for only part of the period during which the employer exposed a victim is liable for only a pro rata part of the employers liability to the victim [9], and (2) if Barker does not apply and the position in Guernsey is now the same as in the UK under the 2006 Act, whether such an insurer is liable in the first instance for the whole of the employers liability to the victim, and (3) if so, whether the insurer has pro rata rights to contribution from any other insurer of that employer and/or from the employer in respect of any periods not covered by the insurer [9]. There are parallel issues regarding such an insurers responsibility for defence costs incurred in meeting the victims claim. For 27 years from 1961 to 1988, Mr Carr was negligently and consistently exposed to asbestos dust by his employer, Guernsey Gas Light Co Ltd (GGLCL). He later contracted mesothelioma, from which he died [10]. Before his death, he sued the Respondent (IEG), as successor in title of GGLCL, and recovered compensation of 250,000 damages and interest plus 15,300 towards his costs. IEG also incurred defence costs of 13,151.60 [11]. During the 27 years of exposure GGLCL had two identifiable liability insurances, one with Excess Insurance Co Ltd, for two years from 1978 to 1980, the other with Midland Assurance Ltd, for six years from 1982 to 1988 [12]. The Appellant (Zurich), as successor to Midlands liabilities, maintains that it is only liable to meet 22.08% of IEGs loss and defence costs, based on the fact that Midland only insured GGLCL for 6/27ths of the 27 year period of exposure [14]. The trial judge ordered Zurich to meet 22.08% of the compensation but 100% of defence costs. The Court of Appeal ordered Zurich to pay 100% of both the compensation and defence costs [15]. Zurich appeals in relation to both compensation and defence costs. The Supreme Court unanimously holds that the common law rule of proportionate recovery established in Barker [2006] UKHL 20 continues to apply in Guernsey; it accordingly allows Zurichs appeal in respect of compensation; but it dismisses the appeal in relation to defence costs [35 and 100]. The judges order is therefore restored. The other issues do not in these circumstances arise, but, because of their general importance, the Supreme Court states its opinion on them. By a majority of 4 3 the Court concludes that, had the position in Guernsey been as in the UK under the 2006 Act, Zurich would have been liable in the first instance to meet IEGs claim in respect of the compensation paid by IEG in full, but would have been entitled, in respect of the 21 years not covered by the Midland insurance, to claim pro rata contribution from the Excess and IEG [96]. Lord Mance (with whom Lords Clarke, Carnwath and Hodge agree) gives the leading majority judgment, and Lord Sumption (with whom Lords Neuberger and Reed agree) the leading minority judgment. Lord Hodge gives a separate judgment, as does Lord Neuberger and Lord Reed. (1) All members of the Court agree that the common law rule in Barker remains unaltered in Guernsey where the 2006 Act does not apply. [27 31]. Only 22.08% of IEGs loss is thus attributable to the period of the Midland insurance for which Zurich must answer [35]. (2) The defence costs are different. They would have been incurred in defending the claim whatever the total period of exposure by GGLCL. They were incurred with insurers consent, in defending a claim for damages for injury or disease caused during the Midland insurance period within the meaning of the main insuring clause. Under the rule in Fairchild, as applied in Trigger, mesothelioma is caused in any period in which exposure occurs which materially contributed to the risk of contracting mesothelioma [36 39]. (3) Had Guernsey had an equivalent to the 2006 Act, IEG would have been liable to Mr Carr for his full 100% loss whether it had exposed him to asbestos for actual 27 years or only for the 6 years of the Midland insurance cover. But it would be anomalous if Zurich had to answer for the full 100% loss without any defence or right of recourse. In this situation, the majority holds that, although Zurich must in the first instance answer for the full 100%, Zurich has equitable rights to contribution pro rata from any other insurer (such as Excess) able to contribute and, in respect of any period where there is no such insurer, from IEG itself. [42 54], [63] and [77 78]. The minority considers that Zurich is only liable to IEG in the first instance for 22.08% of the full loss [180 187]. (4) Lord Mances judgment also discusses the position under the Third Party (Rights against Insurers) Act 1930 had IEG been insolvent, and concludes that it is probable that Mr Carr would in such a case have been able to look to Zurich for his full 100% loss [97].

longest

The three appellants in these two appeals were each convicted of murder. Each had his conviction quashed pursuant to a reference to the Court of Appeal by the Criminal Cases Review Commission (CCRC) in the exercise of its powers under Part II of the Criminal Appeal Act 1995 (the 1995 Act). In each case no order was made for a retrial. Each claimed compensation from the Secretary of State pursuant to section 133 of the Criminal Justice Act 1988 (section 133). That section applies to England and Wales, to Northern Ireland and to Scotland. I shall not refer to provisions which cater for differences of procedure in Scotland. The most material part of that section provides: (1)when a person has been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice, the Secretary of State shall pay compensation for the miscarriage of justice to the person who has suffered punishment as a result of such conviction In each case the claim for compensation was refused by the Secretary of State, whose decisions were upheld on judicial review both at first instance and on appeal. The common issue that arises in relation to each appeal is the meaning of miscarriage of justice in section 133. In the case of Adams there is a second issue, which is the meaning of a new or newly discovered fact. Lord Hope has set out the background to the statutory right to compensation provided by section 133 and I need not repeat his summary. Lord Kerr has set out in detail the relevant facts in the appeals of Mr MacDermott and Mr McCartney and I gratefully adopt his account of these. It remains for me to summarise the facts relevant to the appeal of Mr Adams. They can be shortly stated. A more detailed summary can be found in the extract of the judgment of Simon J at first instance, annexed to the judgment of the Court of Appeal [2009] EWCA Civ 1291; [2010] QB 460. The facts in Mr Adams appeal On 18 May 1993 Mr Adams was convicted in the Crown Court at Newcastle of the murder of a man called Jack Royal and sentenced to life imprisonment. He appealed to the Court of Appeal and on 16 January 1998 his appeal was dismissed. Some nine years later his case was referred to the Court of Appeal by the CCRC on three grounds. The first, and only material ground, was that incompetent defence representation had deprived him of a fair trial. On 12 January 2007 the Court of Appeal allowed his appeal on this ground. The relevant shortcomings in the conduct of Mr Adams defence were, in large measure, the result of a late change of his counsel. This was made when those originally instructed to represent him had to withdraw from the case because of a conflict of interest. Those instructed to replace them were hard pressed to prepare for the trial and failed to consider relevant unused material. Some of this had been disclosed by the prosecution. Some was available on a computer database known as the Holmes database. The case against Mr Adams was essentially based on the evidence of a single witness, Mr Kevin Thompson. His evidence was supported by that of two police officers. It was the defence case that Mr Thompson was lying, that he had entered into a deal with the police to give evidence against Mr Adams, and that he had been fed with information about Mr Royals murder by the police. The evidence which had been overlooked by defence counsel would have provided valuable assistance in cross examining Mr Thompson and the two police officers. The Court of Appeal concluded that, had it been available and deployed, the jury might not have been satisfied of Mr Adams guilt. Accordingly the court quashed the conviction, but in doing so stated expressly that they were not to be taken as finding that, if the failings on the part of the defence lawyers had not occurred, Mr Adams would inevitably have been acquitted: [2007] 1 Cr App R 449 at para 157. Miscarriage of Justice Section 133(1) reproduces, in almost identical wording, the following provision in article 14(6) of the International Covenant on Civil and Political Rights 1966, which this country ratified in May 1976 (article 14(6) of the ICCPR). I shall emphasise the material differences: When a person has by a final decision been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows conclusively that there has been a miscarriage of justice, the person who has suffered punishment as a result of such conviction shall be compensated according to law The reference to a final decision is accommodated by a provision in section 133(5) which defines reversed as referring to a conviction which has been quashed on an appeal out of time or on a reference under the 1995 Act. The possible meanings of miscarriage of justice The meaning of miscarriage of justice in section 133 received consideration by the House of Lords in R (Mullen) v Secretary of State for the Home Department [2004] UKHL 18; [2005] 1 AC 1, when rejecting a claim for compensation by Mr Mullen. He had been convicted of terrorist offences. His conviction had been quashed by an appeal out of time. This was not because there was any doubt that he had committed the offences of which he was convicted. His conviction was quashed because he had been seized and brought to this country from Zimbabwe in circumstances that had involved a flagrant abuse of power. It was not suggested that there was any defect in the trial process itself. The House held that in these circumstances Mr Mullens conviction had not been quashed on the ground of a miscarriage of justice within the meaning of section 133. Lord Steyn expressed the view that this phrase only extended to the conviction of someone subsequently shown to be innocent. Lord Bingham of Cornhill expressed doubt as to whether this was correct. Both were agreed that section 133 was enacted to give effect to article 14(6) and that the meaning of the latter should govern the interpretation of the section. They were not, however, agreed as to the meaning of article 14(6). Lord Rodger of Earlsferry accepted the interpretation reached by Lord Steyn. Lord Walker of Gestingthorpe considered that Lord Steyn had given powerful reasons for his conclusion, but preferred not to go beyond the limited common ground for allowing the appeal. Lord Scott expressed no view on the difference between Lord Bingham and Lord Steyn. Miscarriage of justice is a phrase that is capable of having a number of different meanings. In giving the judgment of the Court of Appeal in relation to Adams case Dyson LJ divided the circumstances in which convictions may be quashed on the basis of the discovery of fresh evidence into four categories, which I shall summarise in my own words. (1) Where the fresh evidence shows clearly that the defendant is innocent of the crime of which he has been convicted. (2) Where the fresh evidence is such that, had it been available at the time of the trial, no reasonable jury could properly have convicted the defendant. (3) Where the fresh evidence renders the conviction unsafe in that, had it been available at the time of the trial, a reasonable jury might or might not have convicted the defendant. (4) Where something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who should not have been convicted. These four categories have provided a useful framework for discussion. There are relatively few domestic authorities that bear on the meaning of miscarriage of justice in section 133 and none which provides a definitive answer. In these circumstances, before considering those authorities, I propose to consider extrinsic sources that might be expected to assist with the interpretation of this phrase. Parliamentary material Mr Bailin QC, appearing for JUSTICE as intervener, submits that a statement made by Earl Ferrers, the Minister of State at the Home Office, throws light on the meaning of miscarriage of justice. The statement was made in the course of debate on the clause that was to become section 133: see Hansard (HL Debates), 22 July 1988, cols 1630 1632. At the outset Earl Ferrers explained that the object of the clause was to give statutory effect to the United Kingdoms obligations under article 14. Lord Hutchinson of Lullington then asked the very question that lies at the heart of these appeals. He contrasted a new fact which resulted in the quashing of a conviction because it raised a lurking doubt in the mind of the Court of Appeal about the safety of the conviction and a new fact which caused the Secretary of State to advise that a defendant should be pardoned because he had been shown to be innocent. Which, he asked, amounted to a miscarriage of justice under the clause? This, he stated, was a crucial point. If it is not contempt of Parliament to observe that Lord Bingham, in his judicial capacity, was uncertain of the answer to this question, after giving it detailed consideration in Mullen, it is not, I hope, contempt of Parliament to suggest that Earl Ferrers, when faced with the question ex improviso in the course of debate, may have had to seek assistance from an official before giving the answer. At all events the answer that he gave was: The normal course is to refer cases to the Court of Appeal and to regard its view as binding. Mr Bailin submits that, in accordance with Lord Hopes observations on the use that can be made of parliamentary material in R v A (No 2) [2002] 1 AC 45 at para 81, this statement binds the Secretary of State to accept that the question of whether there has been a miscarriage of justice must be determined from the judgment of the Court of Appeal in the particular case and that, as the Court of Appeal does not and cannot rule on whether the defendant is innocent, that cannot be the test of whether there has been a miscarriage of justice. I do not accept this submission. The reply given by Earl Ferrers did not answer the question posed by Lord Hutchinson. To be blunt it made no sense. It affords no guidance on the meaning in section 133 of miscarriage of justice. The relevant part of the debate clearly indicates that the intention of Parliament in enacting section 133 was to give effect to the obligation imposed by article 14(6). It does not suggest that Parliament intended that the meaning of section 133 should differ in any way from the meaning of article 14(6). This reinforces the rule of statutory interpretation that raises a presumption that, where a statute is passed in order to give effect to the obligations of the United Kingdom under an international convention, the statute should be given a meaning that conforms to that of the convention: see Salomon v Customs and Excise Commissioners [1967] 2 QB 116, 141 and Bennion on Statutory Interpretation, 5th ed (2008), section 221.6. What then is the meaning of miscarriage of justice in article 14(6)? In answering this question the provisions of the Vienna Convention on the Law of Treaties should be applied: see Fothergill v Monarch Airlines Ltd [1981] AC 251, 283, per Lord Diplock. The interpretation of Article 14(6) As the wording of the English text of article 14(6) is virtually identical to that of section 133, the former throws no light on the meaning of the latter. Article 33 of the Vienna Convention permits reference to the text of a convention in an alternative authenticated language. In Mullen Lord Steyn at para 47 derived assistance from the French text of article 14(6). This uses the phrase une erreur judiciare for miscarriage of justice. Lord Steyn stated that this was a technical expression indicating a miscarriage of justice in the sense of the conviction of someone who was innocent. He did not explain the basis for this assertion and Lord Bingham did not agree with it. He expressed the view at para 9 that erreur judiciare could be understood as equivalent to miscarriage of justice in its broad sense. Lord Binghams interpretation of the French text is to be preferred to that of Lord Steyn. The difference between them received detailed consideration by Girvan LJ in In re Boyles Application [2008] NICA 35 at paras 11 13. He concluded that the French term was as elastic as the English miscarriage of justice. In his written case at para 4.32 Mr Tam QC for the Secretary of State invited the Court to reject Girvan LJs analysis of the French law. In these circumstances the Court allowed Mr Owen to adduce a witness statement from Dr Cristina Mauro, who teaches Criminal Procedure as an Assistant Professor at Universit Panthon Assas at Paris. She confirmed that Girvan LJs interpretation of erreur judiciare was correct, and Mr Tam accepted this to be the case. Had the French text given a more precise meaning to article 14(6) than the English this would have been a legitimate aid to the interpretation of the latter. As it is the French text leaves us no further forward. Article 31(3)(b) of the Vienna Convention also permits one to take into account any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation. Lord Steyn, Girvan LJ and Dr Mauro, in progressively greater detail, have examined articles 622 to 626 of the French Code de Procdure Pnale, which give effect to article 14(6). Once again the analysis of the latter two is to be preferred to that of Lord Steyn. This indicates that in France a conviction will be reviewed where a new element gives rise to serious doubts about guilt and that the reviewing court can then either quash the conviction on the ground that the new element proves that the defendant is not guilty or direct a retrial. Compensation will be recoverable in the former event or, if there is a retrial, if this results in an acquittal. This practice on the part of only one of the many signatories to the ICCPR does not provide a guide to the meaning of article 14(6) but it does demonstrate that proof of innocence has not been universally adopted as the test of entitlement to compensation. It has not been suggested that there is any consistency of practice on the part of the signatories that assists in determining the meaning of article 14(6). If it is not possible to deduce the meaning of article 14(6) from subsequent practice in its application, what of the travaux prparatoires? Article 32 of the Vienna Convention permits recourse to these where necessary to determine the meaning to be attributed to the term of a treaty in the light of its object and purpose see article 31. The Court has been provided with relevant comments on the travaux in The Right to a Fair Trial under the Universal Declaration of Human Rights and the International Covenant on Civil and Political Rights by D Weissbrodt (2001) and Guide to the Travaux Prparatoires of the International Covenant on Civil and Political Rights by M Bossuyt (1987). So far as the precise meaning of miscarriage of justice is concerned the travaux are inconclusive. They disclose that Mrs Roosevelt was opposed to the inclusion of article 14(6) on the ground that its implementation would cause significant technical difficulties because of the diversity of national legislation. They show concern by some, including the British delegate, that the provision should not create an obligation to pay compensation when a conviction was reversed on appeal. Of most significance is the rejection by 22 votes to 11 with 40 abstentions of an amended provision initially proposed by Israel, with input from France and Afghanistan. This reads: The judicial recognition of the innocence of a convicted person shall confer on him the right to request the award of compensation in accordance with the law in respect of any damage caused him by the conviction. While this provides no positive indication of precisely what the state parties intended miscarriage of justice to mean, it makes it difficult to argue that they intended it to mean conviction of the innocent. Lord Bingham suggested at para 9 in Mullen that the phrase miscarriage of justice may have commended itself to the parties because of the latitude of interpretation that it offered and it seems to me that this may well be the case. It is, I believe, possible to make some more positive conclusions about what it was that the states who were involved in the drafting of article 14(6) were trying to achieve. They were concerned with the emergence of a new fact after the completion of the trial process, including review on appeal. Article 14(5) provides that everyone convicted of a crime shall have the right to have his conviction and sentence reviewed by a higher tribunal according to law. Article 14(6) applies to the discovery of a new fact after that final decision. Compensation was only payable where the new fact demonstrated conclusively that there had been a miscarriage of justice. Thus miscarriage of justice had to be the kind of event that one could sensibly require to be proved conclusively. Article 14 is, in general, concerned with the right to a fair trial. Most of its provisions relate to procedure. One might have expected article 14(6) similarly to have been concerned with the consequences of shortcomings in procedure. The travaux do not suggest that this was the primary concern of the delegates. It is perhaps significant that Mrs Roosevelt and Ms Bowie did not consider that the provision belonged in the Covenant and suggested deleting it. What the delegates appear to have been primarily concerned about was not errors of procedure, but the emergence of fresh facts that were inconsistent with the conviction of the defendant. Thus, at the outset, the Philippines suggested that the circumstances in which the provision should apply should be spelt out and that these should be where the true offender had confessed and there were no reasonable grounds to doubt his confession or where the fact or event which was the basis of the conviction was shown beyond reasonable doubt never to have taken place. A comment by Mrs Roosevelt that compensation should be denied to someone who deliberately concealed facts which would have exonerated him if discovered (my emphasis) is a further example of this approach, as is the proposed amendment to which I have referred at para 19 above. The fact remains, however, that this amendment was not carried and that the travaux show concern on the part of some delegates that the provision under discussion would allow compensation to persons who were clearly guilty but whose conviction had been annulled for reasons of form or procedure while others appear to have considered that the provision should provide a guarantee for lawful process. The travaux clearly demonstrate that the parties intended article 14(6) to cover the situation where a newly discovered fact demonstrated conclusively that the defendant was innocent of the crime of which he had been convicted. They were not, however, prepared to agree an interpretation which restricted the ambit of article 14(6) to this situation. In the 14th and final session it is recorded that most of the Committee agreed that only adequate legislation could solve the technical difficulties involved in the problem of compensation for a miscarriage of justice. Thus, while the principle was agreed that there should be compensation for the consequences of a conviction reversed on the ground of conclusive proof of a miscarriage of justice as a result of the discovery of new evidence after the conclusion of the criminal process, and that this would cover the case of a convicted man who was shown to be innocent, it seems to have been left to the individual parties by domestic legislation to identify the precise parameters of the miscarriage of justice that would give rise to a right to compensation. The words according to law were added to the article by a late amendment. It would have been possible for the contracting parties to have agreed that any person whose conviction was reversed by reason of a newly discovered fact should be given compensation for the consequences of the conviction. This could have been justified on the basis that the reversal of the conviction raised a presumption of innocence and that compensation should be paid on the basis of that presumption. The parties did not take that course. The fact that they did not do so, and the requirement that the miscarriage of justice should be established conclusively, indicates so it seems to me, an anxiety not to agree to an entitlement to compensation that would result in compensation being paid to those who had in fact committed the crimes of which they were convicted, at least on a substantial scale. In these circumstances the fact that section 133 is intended to give effect to the obligation imposed by article 14(6) is of limited assistance in interpreting that section. It would not be right, however, when interpreting section 133 to lose sight of the fact that it is giving effect to a convention agreed by parties with varying systems of criminal justice. Article 14(6) is applicable to criminal trials in jurisdictions that have jury trials and jurisdictions that do not, to civil and to common law jurisdictions. The meaning given to miscarriage of justice should be one that is capable of application to the systems of criminal justice of the other parties to the covenant. I have not found any other extrinsic material to be of assistance. In Mullen Lord Bingham at para 9(3) considered the jurisprudence of the United Nations Human Rights Committee and concluded that this did not assist. He reached the same conclusion in relation to the explanatory report of the Steering Committee for Human Rights in relation to article 3 of the Seventh Protocol to the European Convention on Human Rights. I agree with Lord Bingham for the reasons which he gave. Mullen I now turn to consider the decision of the House of Lords in Mullen. This task has been undertaken in a little detail by Lord Hope, which shortens the comments that I wish to make on this decision. The reason why the appeal in Mullen did not succeed was that the House of Lords were unanimous in holding that the abuse of power that had led to the quashing of Mr Mullens conviction did not fall within the definition of miscarriage of justice, whatever the meaning of that phrase. At para 8 Lord Bingham said: It is for failures of the trial process that the Secretary of State is bound, by section 133 and article 14(6), to pay compensation. On that limited ground I would hold that he is not bound to pay compensation under section 133. It was this statement that led Mr Owen to advance, initially, an argument that section 133 was directed at some failure in the trial process. This led him to submit that if, after an impeccably conducted trial, the discovery of DNA evidence demonstrated conclusively that the convicted defendant was innocent, no claim for compensation would lie under section 133. He was right subsequently to acknowledge that this could not be correct, but that acknowledgement raised a question as to the validity of Lord Binghams observation that section 133 applied to failures of the trial process. I also question that statement. It is not the failure of the trial process that constitutes a miscarriage of justice, but the wrongful conviction that may be caused by it. A wrongful conviction is capable of amounting to a miscarriage of justice whether or not it has been caused by a failure of the trial process. I do not believe that Lord Bingham can have intended to exclude from the ambit of section 133 convictions quashed as the result of the discovery of new facts in circumstances where there has been no failure of the trial process. That, I believe, is the situation with which section 133 is, at least primarily, concerned. There is a question as to the assistance that is to be derived from the following earlier comments in para 4 of Lord Binghams judgment: The expression wrongful convictions is not a legal term of art and it has no settled meaning. Plainly the expression includes the conviction of those who are innocent of the crime of which they have been convicted. But in ordinary parlance the expression would, I think, be extended to those who, whether guilty or not, should clearly not have been convicted at their trials. It is impossible and unnecessary to identify the manifold reasons why a defendant may be convicted when he should not have been. It may be because the evidence against him was fabricated or perjured. It may be because flawed expert evidence was relied on to secure conviction. It may be because evidence helpful to the defence was concealed or withheld. It may be because the jury was the subject of malicious interference. It may be because of judicial unfairness or misdirection. In cases of this kind, it may, or more often may not, be possible to say that a defendant is innocent, but it is possible to say that he has been wrongly convicted. The common factor in such cases is that something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who should not have been convicted. In R (Clibery) v Secretary of State for the Home Department [2007] EWHC 1855 (Admin) at para 25 I stated that in this passage Lord Bingham was identifying the types of miscarriage of justice that would fall within section 133. On reflection I believe that I was wrong. As Lord Hope has pointed out in para 90 Lord Bingham was discussing the meaning of wrongful conviction in the context of the previous ex gratia scheme. There is a further point to be made in relation to para 4 of Lord Binghams speech. He has included in the catalogue of cases resulting in the conviction of someone who should not have been convicted the case of a judicial misdirection. A judicial misdirection could not be a new or newly discovered fact, but if it were it would fall into Dyson LJs third category. So might a conviction based on flawed expert evidence: see R (Allen) (formerly Harris)) v Secretary of State for Justice [2008] EWCA Civ 808; [2009] 2 All ER 1. Thus para 4 would appear to embrace all four of Dyson LJs categories. In para 9 Lord Bingham observed, when considering section 133, that, while miscarriage of justice can be used to describe the conviction of the demonstrably innocent, it can be and has been used to describe cases in which defendants, guilty or not, certainly should not have been convicted. This also has been treated by some as expressing Lord Binghams view of the scope of section 133, but I do not think that it is clear that this was so. In these circumstances, I agree with Lord Hope that Lord Binghams speech does not provide significant positive assistance in interpreting miscarriage of justice in section 133. It is of assistance in respect of his comments on Lord Steyns answer to that question. Lord Steyns conclusion in Mullen that miscarriage of justice was restricted to the conviction of an innocent person was largely founded on his misreading of the French text of article 14(6) and of the position in France. Shorn of that support, his speech does not provide compelling justification for his conclusion. For all these reasons I do not believe that Mullen helps very much in determining the meaning of miscarriage of justice in section 133. The cases that have followed Mullen, including those before this Court, have proceeded on the basis that Lord Bingham had laid down an alternative test to that of Lord Steyn, and concluded, in each case, that neither test was satisfied. In the circumstances there is nothing to be gained by considering those decisions. I agree with Lord Hope that a fresh approach is required. I propose to adopt the four categories identified by Dyson LJ as the framework for discussion. The nature of the exercise The wording of section 133, following that of article 14(6), might suggest that the terms of the judgment of the court that reverses the conviction will establish whether the entitlement to compensation has been made out. It speaks of a conviction being reversed on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice (emphasis added). That is not, however, the test for quashing a conviction in this jurisdiction. The words on the ground that must, if they are to make sense, be read as in circumstances where. Section 133(1) provides that the compensation will be paid by the Secretary of State, and section 133(2) provides for a two year time limit for application for compensation to the Secretary of State. Thus it is for the Secretary of State to decide whether the requirements of section 133 are satisfied, an exercise which is, of course, subject to judicial review. The Secretary of State first has to consider whether a new or newly discovered fact has led to the quashing of a conviction. If it has, he then has to consider whether that fact shows beyond reasonable doubt that there has been a miscarriage of justice, applying the true meaning of that phrase. The Secretary of State will plainly have regard to the terms of the judgment that quashes the conviction, but ultimately he has to form his own conclusion on whether section 133 is satisfied. The object of the exercise I think that the primary object of section 133, as of article 14(6), is clear. It is to provide entitlement to compensation to a person who has been convicted and punished for a crime that he did not commit. But there is a subsidiary object of the section. This is that compensation should not be paid to a person who has been convicted and punished for a crime that he did commit. The problem with achieving both objects is that the quashing of a conviction does not of itself prove that the person whose conviction has been quashed did not commit the crime of which he was convicted. Thus it is not satisfactory to make the mere quashing of a conviction the trigger for the payment of compensation. It was this problem which led to the adoption of the imprecise language of article 14(6), which has been reproduced in section 133. In interpreting section 133 it is right to have in mind the two conflicting objectives. It is necessary to consider whether the wording of the section permits a balance to be struck between these two objectives and, if so, how and where that balance should be struck. I turn to consider Dyson LJs four categories having in mind these considerations. I shall deviate from the order in which he set them out. Category 4: where something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who should not have been convicted This category is derived from Lord Binghams speech in Mullen. As I have explained, I do not believe that he put it forward as falling within the scope of section 133. As I understand it, the category embraces an abuse of process so egregious that it calls for the quashing of a conviction, even if it does not put in doubt the guilt of the convicted person. I would not interpret miscarriage of justice in section 133 as embracing such a situation. It has no bearing on what I have identified as the primary purpose of the section, which is the compensation of those who have been convicted of a crime which they did not commit. If it were treated as falling within section 133 this would also be likely to defeat the subsidiary object of section 133, for it would result in the payment of compensation to criminals whose guilt was not in doubt. Category 3: Fresh evidence rendering the conviction unsafe Dyson LJ propounded this test as requiring consideration of whether a fair minded jury could properly convict if there were to be a trial which included the fresh evidence. This raises the question, which I shall consider further when I come to category 2, of whether section 133 requires the Secretary of State to consider the reaction to fresh evidence of a fair minded jury. Put another way, the situation under consideration is one where the fresh evidence reduces the strength of the case that led to the claimants conviction, but does not diminish it to the point where there is no longer a significant case against him. I would not place this category within the scope of section 133 for two reasons. The first is that it gives no sensible meaning to the requirement that the miscarriage of justice must be shown beyond reasonable doubt, or conclusively in the wording of article 14(6). It makes no sense to require that the new evidence must show conclusively that the case against the claimant is less compelling. It is tantamount to requiring the Secretary of State to be certain that he is uncertain of the claimants guilt. My second reason is that, if category 3 were adopted as the right definition of miscarriage of justice, it would not strike a fair balance between the two objectives of section 133. The category of those who are convicted on evidence which appears to establish guilt beyond reasonable doubt, but who have their convictions quashed because of fresh evidence that throws into question the safety of their convictions, will include a significant number who in fact committed the offences of which they were convicted. This is the inevitable consequence of a system which requires guilt to be proved beyond reasonable doubt. When these two factors are considered together they lead to the conclusion that section 133 does not, on its true interpretation, apply to category 3. Category 1: Fresh evidence that shows clearly that the defendant is innocent of the crime of which he was convicted Having considered the categories which were at one extremity of Dyson LJs list, I now turn to the category at the other. Plainly section 133 will embrace this category, but does it provide the exclusive definition of miscarriage of justice in that section? There are a number of points to be made in favour of this suggestion. The first is that it gives section 133 a perfectly natural and logical meaning, indeed it is the meaning that the man in the street would be likely to accord to the wording of section 133. More particularly, if miscarriage of justice is read as meaning the conviction of someone who is innocent, it makes perfect sense of the requirement that the new fact should prove this beyond reasonable doubt. Next it gives section 133 a meaning which is eminently practicable. Objection has been made to category 1 on the ground that it is not the role of the Court of Appeal, when reviewing a conviction, to rule whether the defendant is innocent of the crime of which he was convicted. In R v McIlkenny (1991) 93 Cr App R 287, 311 Lloyd LJ observed that the Court of Appeal was neither obliged nor entitled to state that an appellant was innocent. Its task was simply to decide whether the verdict of the jury could stand. He described this as a point of great constitutional importance. I think that he was right. The point was well put by the Court of Appeal for Ontario in R v Mullins Johnson 2007 ONCA 720; 87 OR (3d) 425. The appellant had been convicted of murder of his 4 year old niece and served 12 years in prison. His conviction was based on expert evidence that the autopsy indicated that the young girl had been sexually abused and suffocated. Subsequent medical evidence totally discredited the evidence given at the trial, so that it became clear that there was no reliable pathological evidence either of sexual abuse or of homicidal asphyxia of the child. The case was referred to the Court of Appeal on terms that it should treat it as an appeal on fresh evidence. In a passage which merits citation in full, the Court explained why it would not be proper for it in these circumstances to make a declaration that the appellant was in fact innocent: 22 The fresh evidence shows that the appellants conviction was the result of a rush to judgment based on flawed scientific opinion. With the entering of an acquittal, the appellants legal innocence has been re established. The fresh evidence is compelling in demonstrating that no crime was committed against Valin Johnson and that the appellant did not commit any crime. For that reason an acquittal is the proper result. 23 There are not in Canadian law two kinds of acquittals: those based on the Crown having failed to prove its case beyond a reasonable doubt and those where the accused has been shown to be factually innocent. We adopt the comments of the former Chief Justice of Canada in The Lamer Commission of Inquiry Pertaining to the Cases of: Ronald Dalton, Gregory Parsons, Randy Druken, Annex 3, pp. 342: [A] criminal trial does not address factual innocence. The criminal trial is to determine whether the Crown has proven its case beyond a reasonable doubt. If so, the accused is guilty. If not, the accused is found not guilty. There is no finding of factual innocence since it would not fall within the ambit or purpose of criminal law. 24 Just as the criminal trial is not a vehicle for declarations of factual innocence, so an appeal court, which obtains its jurisdiction from statute, has no jurisdiction to make a formal legal declaration of factual innocence. The fact that we are hearing this case as a Reference under section 696.3(3)(a)(ii) of the Criminal Code does not expand that jurisdiction. The terms of the Reference to this court are clear: we are hearing this case as if it were an appeal. While we are entitled to express our reasons for the result in clear and strong terms, as we have done, we cannot make a formal legal declaration of the appellants factual innocence. 25 In addition to the jurisdictional issue, there are important policy reasons for not, in effect, recognizing a third verdict, other than guilty or not guilty, of factually innocent. The most compelling, and, in our view, conclusive reason is the impact it would have on other persons found not guilty by criminal courts. As Professor Kent Roach observed in a report he prepared for the Commission of Inquiry into Certain Aspects of the Trial and Conviction of James Driskell, there is a genuine concern that determinations and declarations of wrongful convictions could degrade the meaning of the not guilty verdict (p 39). To recognize a third verdict in the criminal trial process would, in effect, create two classes of people: those found to be factually innocent and those who benefited from the presumption of innocence and the high standard of proof beyond a reasonable doubt. But the decision whether there has been a miscarriage of justice within section 133 is not for the court but for the Secretary of State. He should have no difficulty in deciding whether new evidence that has led to the quashing of a conviction shows beyond reasonable doubt that the defendant was innocent of the crime of which he was convicted. Where the prosecution has satisfied the jury beyond reasonable doubt that a defendant is guilty, evidence that demonstrates beyond reasonable doubt that he was in fact innocent will not be equivocal. Even though it is not for the Court of Appeal, when quashing the conviction, to express its opinion that the defendant is innocent, the reasons given for quashing the conviction are unlikely to leave any doubt of this, just as was the position in Mullins Johnson. The other obvious point in favour of category 1 is that it precludes all possibility of a defendant who in fact committed the crime of which he was convicted receiving compensation for the consequences of his conviction. If this is to be treated as being of paramount importance, then category 1 is the only satisfactory interpretation of section 133. The Law Commission of New Zealand in its 1998 Report No 49 on Compensating the Wrongly Convicted advised at para 127 A requirement to prove innocence is, however, necessary to prevent the guilty claimant, acquitted on a technicality, from profiting from the crime. It recognises that it is a persons innocence which provides the justification for compensation in the first place. This brings me to the last point that is advanced in favour of category 1. It is argued that it is not in practice possible to draw a line between category 2 and category 3. Unless category 1 is adopted as the correct interpretation of section 133, defendants whose convictions are quashed on technicalities will profit from compensation. I shall consider this argument when I deal with category 2. The first argument against restricting the ambit of section 133 to category 1 is that the parties to article 14(6) voted against an amendment which would have done this. The second is that this will deprive some defendants who are in fact innocent and who succeed in having their convictions quashed on the grounds of fresh evidence from obtaining compensation. It will exclude from entitlement to compensation those who no longer seem likely to be guilty, but whose innocence is not established beyond reasonable doubt. This is a heavy price to pay for ensuring that no guilty person is ever the recipient of compensation. Does category 2, or some similar formulation of miscarriage of justice, provide a more satisfactory approach to the desire to provide compensation to the innocent without rewarding the guilty that both accords with the language of the section and is workable in practice? Category 2: Fresh evidence such that, had it been available at the trial no reasonable jury could convict the defendant This category applies to the evidence, including the fresh evidence, the test that a judge has to apply when considering an application at the end of the prosecution case for dismissal of a charge on the ground that the defendant has no case to answer. It focuses on the evidence before the jury. If the fresh evidence were always evidence of primary fact, or new expert evidence, the test might be satisfactory. The position is not, however, as simple as that. The new evidence that leads to the quashing of a conviction is very often not primary evidence that bears directly on whether the defendant committed the crime of which he was convicted, but evidence that bears on the credibility of those who provided the primary evidence on which he was convicted. Both of the appeals before the Court fall into this category. So does the example of category 2 given by Dyson LJ: fresh evidence which undermines the creditworthiness of the sole witness for the prosecution. Here one can run into a problem that is peculiar to the criminal procedures that apply in common law jurisdictions. Under common law procedures the evidence that is permitted to be placed before the jury is screened by a number of rules that are designed to avoid the risk that the jury will be unfairly prejudiced and to ensure that the trial is fair. Thus section 78 of the Police and Criminal Evidence Act 1984 gives the judge a general jurisdiction to exclude evidence on the grounds of fairness and section 76A of the same Act contains a little code governing the admissibility of a confession. So does section 8(2) of the Northern Ireland (Emergency Provisions) Act 1978, which was applicable to the critical evidence adduced against the defendants in the second appeal. Often it will be appropriate for the judge to hold a voir dire in order to decide whether or not evidence can be admitted. The question of whether there is evidence upon which a jury can properly convict is taken after the judge has screened from the jury evidence which, under the relevant procedural code, he has ruled to be inadmissible. That is often a difficult judicial task. I do not believe that section 133 should be so interpreted as to impose on the Secretary of Sate the task of deciding whether the fresh evidence would have rendered inadmissible the primary evidence to which it related, in order to answer the question whether there would have been a case upon which a reasonable jury could convict. There is a further difficulty with category 2. The question of whether a reasonable jury could properly convict falls to be answered having regard to the fact that a jury must be satisfied of guilt beyond reasonable doubt. Section 133 requires the Secretary of State to be satisfied beyond reasonable doubt that a miscarriage of justice has occurred. Category 2 thus operates as follows: compensation will be payable where the Secretary of State is satisfied beyond reasonable doubt that no reasonable jury could have been satisfied beyond reasonable doubt that the defendant was guilty. This does not seem a very sensible test. The final point to make about category 2 is that it applies a test the result of which depends critically on common law procedural rules. As the test is derived from article 14(6), it would be preferable if it were one more readily applicable in other jurisdictions. For these reasons I do not consider the second category, as formulated by Dyson LJ, provides a satisfactory definition of miscarriage of justice. I would replace it with a more robust test of miscarriage of justice. A new fact will show that a miscarriage of justice has occurred when it so undermines the evidence against the defendant that no conviction could possibly be based upon it. This is a matter to which the test of satisfaction beyond reasonable doubt can readily be applied. This test will not guarantee that all those who are entitled to compensation are in fact innocent. It will, however, ensure that when innocent defendants are convicted on evidence which is subsequently discredited, they are not precluded from obtaining compensation because they cannot prove their innocence beyond reasonable doubt. I find this a more satisfactory outcome than that produced by category 1. I believe that it is a test that is workable in practice and which will readily distinguish those to whom it applies from those in category 3. It is also an interpretation of miscarriage of justice which is capable of universal application. Retrial The provisions in relation to retrial introduced into section 133 in the circumstances described by Lord Hope at paras 103 and 104 of his judgment raise a problem. A retrial will only be ordered where, although it quashes the defendants conviction on the grounds of fresh evidence, the Court of Appeal considers that there remains a case against him that is fit for trial. Assuming that they are correct in that view, the fresh evidence could never fall within the scope of section 133 if it is right to interpret that section as being limited to either category 1 or category 2, as formulated by Dyson LJ or as I have reformulated it. The introduction into the section of the provisions in relation to retrial would make more sense if section 133 embraced category 3. In that case, however, one might have expected compensation to be payable automatically if the retrial ended in an acquittal, but the amended section 133 does not so provide. It does not follow, however, that category 1 or category 2 cannot stand with section 133, as amended. Entitlement to compensation does not turn on the view that the Court of Appeal takes of the new evidence. The defendant may contend, even where a retrial is ordered, that the fresh evidence proves his innocence. Although the Court of Appeal is not persuaded of this, it may become apparent in the course of the retrial that the defendant is correct. Thus the provisions in relation to retrial make sense, even if category 1 or category 2 represents the correct interpretation of miscarriage of justice. Article 6(2) of the European Convention on Human Rights The Strasbourg Court has stated that one of the functions of article 6(2) is to protect an acquitted persons reputation from statements or acts that follow an acquittal which would seem to undermine it see Taliadorou and Stylianou v Cyprus (Application Nos 39627/05 and 39631/05) (unreported) 16 October 2008, at para 26. The Courts expansion of what would seem to be a rule intended to be part of the guarantee of a fair trial into something coming close to a principle of the law of defamation is one of the more remarkable examples of the fact that the Convention is a living instrument. Mr Owen QC for Mr Adams referred the Court to a series of decisions of the Strasbourg Court in which it was held to be a violation of article 6(2) for a state to refuse compensation to which an applicant who had been held in preventative detention was normally entitled on acquittal at the end of a criminal trial on the ground that his acquittal did not establish his innocence. Lord Hope has summarised the details and effect of those authorities. Mr Owen argued that their effect was that, once Mr Adams conviction had been quashed, he was entitled to be treated as innocent in the context of his claim for compensation. A rather different argument based on article 6(2) was rejected by Lord Steyn in Mullen at para 44. Mr Owen first advanced the present argument when appearing for the claimant in R(Allen) (formerly Harris)) v Secretary of State for Justice [2009] 2 All ER 1. In that case the claimants claim for compensation under section 133 was rejected on the grounds that his case satisfied neither Lord Steyns test in Mullen nor the test that Lord Bingham had been thought to advance in that case. Giving the only reasoned judgment, Hughes LJ comprehensively rejected Mr Owens argument based on article 6(2) for a series of ten reasons. On the present appeals Lord Hope has held that reliance on article 6(2) is misplaced for reasons that have much in common with those of Hughes LJ. I agree with both of them. I would add this. The appellants claims are for compensation pursuant to the provisions of section 133. On no view does that section make the right to compensation conditional on proof of innocence by a claimant. The right to compensation depends upon a new or newly discovered fact showing beyond reasonable doubt that a miscarriage of justice has occurred. Whatever the precise meaning of miscarriage of justice the issue in the individual case will be whether it was conclusively demonstrated by the new fact. The issue will not be whether or not the claimant was in fact innocent. The presumption of innocence will not be infringed. Newly discovered fact Mr Adams appeal raises a second issue. Were the facts that led to the quashing of his conviction newly discovered despite the fact that they were contained in documents disclosed to his legal representatives before his trial or available on the Holmes database? The phrase newly discovered raises a further difficult problem of interpretation, for it does not indicate to whom the discovery must be new. Procedure Act 1993. Section 9(6) of that Act provides: Ireland has given effect to article 14(6) by section 9 of the Criminal newly discovered fact means ( a ) where a conviction was quashed by the Court on an application under section 2 or a convicted person was pardoned as a result of a petition under section 7, or has been acquitted in any re trial, a fact which was discovered by him or came to his notice after the relevant appeal proceedings had been finally determined or a fact the significance of which was not appreciated by the convicted person or his advisers during the trial or appeal proceedings. I would adopt this generous interpretation of newly discovered fact. Section 133(1), following the almost identical wording of article 14(6), ends with the proviso : unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted. This proviso is significant in more than one way. First, the use of the word non disclosure would seem to equate the new discovery with disclosure. The latter word has a broad ambit and, in context, suggests to me the bringing of a fact into the public domain and, in particular, the disclosure of that fact to the court. Secondly, I read the provision as excluding a right to compensation where the person convicted has deliberately prevented the disclosure of the relevant fact, or where the non discovery of that fact is otherwise attributable to his own fault. We are envisaging a situation where a claimant has been convicted, and may well have served a lengthy term of imprisonment, in circumstances where it has now been discovered that a fact existed which either demonstrates that he was innocent or, at least, undermines the case that the prosecution brought against him. If he was aware of this fact but did not draw it to the attention of his lawyers, and he did not deliberately conceal it (which would bring the fact within the proviso), this will either be because the significance of the fact was not reasonably apparent or because it was not apparent to him. Many who are brought before the criminal courts are illiterate, ill educated, suffering from one or another form of mental illness or of limited intellectual ability. A person who has been wrongly convicted should not be penalised should this be attributable to any of these matters. It is for those reasons that I would adopt the same interpretation of newly discovered fact as the Irish legislature. Conclusions It has always been common ground that Mr Adams case falls into category 3. The newly discovered facts (as I would hold them to be) in his case do not show that a miscarriage of justice has occurred within the meaning that I would give to that phrase in section 133. Accordingly, I would dismiss his appeal. The newly discovered facts in the case of Mr McCartney and Mr MacDermott, as described by Lord Kerr, so undermine the evidence against them that no conviction could possibly be based upon it. There can be no reasonable doubt of this. Accordingly I would allow their appeal and hold that they are entitled to compensation pursuant to the provisions of section 133. LORD HOPE I accept with gratitude Lord Phillips description of the facts in the case of Andrew Adams and Lord Kerrs description of the facts in the cases of Eamonn MacDermott and Raymond McCartney. With that advantage I can go straight to the issues of principle that these cases have raised. Mention should also be made of Barry George, who was granted permission to intervene in this appeal. On 2 July 2001 he was convicted of the murder on 26 April 1999 of the television presenter Jill Dando, who was killed by a single shot to the head as she was about to enter her home in Fulham. His appeal against conviction was dismissed on 29 July 2002: [2002] EWCA Crim 1923. A major part of the Crowns case against him was that a single particle of firearms discharge, which matched particles found in the cartridge case of the bullet which killed Miss Dando, in her coat and in samples of her hair, had been found nearly 12 months later in the pocket of a coat owned and worn by Mr George. Following a review of his case, the Criminal Cases Review Commission decided to refer his conviction to the Court of Appeal under section 9 of the Criminal Appeal Act 1995 on the ground that new evidence called into question the evidence at the trial about the firearms discharge and the significance that had apparently been attached to that evidence. New reports obtained from the Forensic Science Service had shown that it had no evidential value in the case against Mr George. On 15 November 2007 the Court of Appeal quashed the conviction and ordered a retrial: [2007] EWCA Crim 2722. The evidence of the firearms discharge was not admitted at the trial. On 1 August 2008 the jury by a unanimous verdict found Mr George not guilty. On the day of the acquittal the Crown Prosecution Service issued a press statement in which it was stated that Mr George now had the right to be regarded as an innocent man. On 7 October 2009 Mr George applied for compensation under section 133 of the Criminal Justice Act 1988. By letter dated 15 January 2010 the Secretary of State for Justice told Mr George that he was not prepared to authorise an award of compensation as the new forensic evidence did not prove beyond reasonable doubt that he was innocent. He referred to the fact that in its judgment of 15 November 2007 the Court of Appeal stated that in the absence of the evidence of the firearms discharge there was circumstantial evidence capable of implicating Mr George, and that it had ordered a retrial which defence counsel conceded should take place. Mr George applied for judicial review of that decision on 14 April 2010. On 25 August 2010 Collins J granted permission. But he stayed the proceedings pending the decision of this Court as to the meaning of miscarriage of justice in section 133 of the 1988 Act. Mr Glen QC for Mr George submitted that it was sufficient to entitle a person to an award of compensation under that section that his conviction had been reversed on the ground of a new or newly discovered fact and that, in the event of his being subjected to a retrial, he had been acquitted of the offence. As that was what had happened in his case it should be made clear by this Court in its judgment that, where a person had suffered punishment in such circumstances, compensation should be paid to him under the scheme that had been set up by the statute. With that introduction I can go straight to the issues of principle that these cases have raised. Background The background to the introduction of a statutory right to compensation for miscarriages of justice by section 133 of the Criminal Justice Act 1988 was described in In re McFarland [2004] UKHL 17, [2004] 1 WLR 1289, paras 6 9 by Lord Bingham of Cornhill and R (Mullen) v Secretary of State for the Home Department [2004] UKHL 18, [2005] 1 AC 1, paras 25 28 by Lord Steyn. Lord Bingham drew attention in McFarland, para 6, to the underlying principles. In any liberal democratic state there will be those who are accused of crime and are acquitted at trial, or whose convictions are reversed following an appeal. Those affected will have suffered the stigma of being accused and the trauma of standing trial and of imprisonment before the process is brought to an end. In principle it might seem that the state, which initiated the unsuccessful prosecution, should compensate those who have been acquitted, or at least some of them. How this was to be done and in what circumstances was much debated before the current system was adopted: see David Harris, The Right to a Fair Trial in Criminal Proceedings as a Human Right (1967) 16 ICLQ 352, 372 375. It was, as Lord Steyn said in Mullen, para 52, a process of evolution. First, there was the adoption on 16 December 1966 of the International Covenant on Civil and Political Rights (the ICCPR), article 14(6) of which made provision for what it described as compensation according to law to a person whose conviction had been reversed or had been pardoned in the circumstances to which it referred and who had suffered punishment as a result of such a conviction. The ICCPR was ratified by the United Kingdom on 20 May 1976. On 29 July 1976 the Home Secretary (Mr Roy Jenkins) set out in a written answer the procedure which was being adopted for the making of ex gratia payments in recognition of the hardship caused by what he referred to as a wrongful conviction: Hansard (HC Debates), WA cols 328 330. Three weeks later, on 20 August 1976, the ICCPR entered into force. Thereafter the United Kingdom continued to fulfil its international obligations under article 14(6) under the ex gratia scheme. The scheme was put onto a more formal basis on 29 November 1985: see Hansard (HC Debates), WA cols 689 690. The then Home Secretary (Mr Douglas Hurd) said that he would be prepared to pay compensation where this was required by the international obligations, and that he remained prepared to pay compensation to people who did not fall within the terms of article 14(6) but who had spent a period in custody following a wrongful conviction or charge, where he was satisfied that it had resulted from serious default on the part of a member of a police force or of some other public authority. He said that the Secretary of State for Northern Ireland intended to follow a similar practice. A similar scheme was already in operation in Scotland. There was however international pressure on the United Kingdom to put its obligations under article 14(6) on a statutory footing: see R (Mullen) v Secretary of State for the Home Department [2004] UKHL 18, [2005] 1 AC 1, para 28 by Lord Steyn. The response to it was section 133 of the Criminal Justice Act 1988. The new statutory right superseded in part the existing scheme for ex gratia payments, which remained in being until April 2006, when it was terminated both in England and Wales and Northern Ireland. This has had the inevitable, but unfortunate, consequence that claimants in those jurisdictions are now dependent solely upon the scheme provided by the statute. The ex gratia scheme which has been operated in Scotland by the Scottish Ministers still remains in force there, alongside the system for the payment of compensation in respect of all reversals of convictions that fall within section 133 of the 1988 Act. This enables those against whom criminal proceedings were taken which can properly be regarded with hindsight as wrongful to be compensated even though their cases cannot be brought within the terms of the statute. The way the scheme is currently operated in England and Wales was set out by the Minister of State (Lord McNally) in a written answer which was published on 1 March 2011 (Hansard (HL Debates), WA col 318), in which he said: Compensation is paid under [section 133] where a conviction is quashed following an out of time appeal or following a reference by the Criminal Cases Review Commission to the relevant appeal court on the basis that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice. Section 133 fully meets our international obligations. The Government do not operate a compensation scheme for those who have convictions quashed at in time appeals or those who are acquitted at trial. Figures disclosed by the Ministry of Justice about the number of applications received and the number of applications approved in England and Wales show that there has been a very substantial drop in the number of applications approved since the abolition of the ex gratia scheme in 2006. The system prior to that date was that all applications were considered first under section 133 and then, if not approved, were considered under the ex gratia scheme. The following table shows all applications for compensation received since May 2004 and those which were approved under section 133 : Year 2004 05 2005 06 2006 07 2007 08 2008 09 2009 10 The statutory scheme Article 14(6) of the ICCPR provides: Total Applications Received 88 74 39 40 38 37 Applications Approved Under s 133 39 21 23 7 7 1 When a person has by a final decision been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows conclusively that there has been a miscarriage of justice, the person who has suffered punishment as a result of such conviction shall be compensated according to law, unless it is proved that the non disclosure of the unknown fact in time is wholly or partly attributable to him. The wording of section 133(1) of the 1988 Act follows that of article 14(6). It provides: (1) Subject to subsection (2) below, when a person has been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice, the Secretary of State shall pay compensation to the person who has suffered punishment as a result of such conviction or, if he is dead, to his personal representatives, unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted. Subsection (2) provides that no payment of compensation is to be made unless an application for compensation is made to the Secretary of State, for which a time limit of two years beginning with the date when the persons conviction is reversed or he is pardoned was introduced in relation to England and Wales and Northern Ireland by section 61(3) of the Criminal Justice and Immigration Act 2008. Section 133(5) of the 1988 Act, as amended by paragraph 16(4) of Schedule 2 to the Criminal Appeal Act 1995, provides: In this section reversed shall be construed as referring to a conviction having been quashed or set aside (a) on an appeal out of time; or (b) on a reference (i) (ii) under section 194B of the Criminal Procedure (Scotland) Act under the Criminal Appeal Act 1995; or 1995. Subsection (5A), which was inserted in relation to England and Wales and Northern Ireland by section 61(5) of the Criminal Justice and Immigration Act 2008, provides: (5A) But in a case where (a) a persons conviction for an offence is quashed on an appeal out of time, and (b) the person is to be subject to a retrial, the conviction is not to be treated for the purposes of this section as reversed unless and until the person is acquitted of all offences at the retrial or the prosecution indicates that it has decided not to proceed with the retrial. To be entitled to compensation under section 133(1) the claimant must show that he has been convicted of a criminal offence and that subsequently his conviction has been reversed on an appeal out of time or on a reference by the CCRC, or he has been pardoned: on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice. The words that I have quoted from the subsection differ from the equivalent part of article 14(6) of the ICCPR in one respect only. The statute uses the phrase beyond reasonable doubt where article 14(6) uses the word conclusively. One might have thought at first sight that, when applications for compensation were made to the Secretary of State, such simple wording could be applied to each case without much difficulty. But that has proved not to be the case, as can be seen from the speeches in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1, where the meaning of the words miscarriage of justice was under scrutiny. Lord Bingham said that he would hesitate to accept the submission of the Secretary of State that section 133 obliged him to pay compensation only when a defendant, finally acquitted in the circumstances satisfying the statutory conditions, is shown beyond reasonable doubt to be innocent of the crime of which he had been convicted: para 9. Lord Steyn, on the other hand, said that the words miscarriage of justice extend only to cases where the person concerned is acknowledged to be clearly innocent: para 56. Then there are the words new or newly discovered fact. What is a fact for this purpose? And to whom does it have to be new or by whom does it have to be newly discovered? The meaning of those words is in issue in the appeal by Adams, whose conviction was reversed because of a failure by his representatives to make themselves aware of and make use of three pieces of important material at his trial which had been made available to them by the prosecution but of which Adams himself was not aware. The issue as to what is meant by the words miscarriage of justice is common to his appeal and the appeals of MacDermott and McCartney. It will be convenient to examine this issue first. Miscarriage of justice Attempts have been made in subsequent cases to reconcile the differing views as to the meaning of miscarriage of justice that were expressed in Mullen: see R (Murphy) v Secretary of State for the Home Department [2005] EWHC 140 (Admin), [2005] 1 WLR 3516; R (Clibery) v Secretary of State for the Home Department [2007] EWHC 1855 (Admin); In re Boyles Application [2008] NICA 35; R (Allen) (formerly Harris) v Secretary of State for Justice [2008] EWCA Civ 808, [2009] 2 All ER 1; R (Siddall) v Secretary of State for Justice [2009] EWHC 482 (Admin). In the Court of Appeal in Adamss case Dyson LJ said that, like Lord Phillips of Worth Matravers CJ in Cliberys case and Richards J in Murphy, he did not propose to express a view as to whether Lord Binghams interpretation was to be preferred to that of Lord Steyn: R (Adams) v Secretary of State for the Home Department [2009] EWCA Civ 1291, [2010] QB 460, para 42. The assumption has been that Lord Binghams reference in para 4 of his speech in Mullen to something having gone seriously wrong in the investigation of the offence or the conduct of the trial could be taken as a test of whether the right to compensation under section 133 was available that could sit alongside that preferred by Lord Steyn. In Allen, para 26 Hughes LJ said that this was made the plainer by Lord Binghams references to a defendant who should clearly not have been convicted in para 4 and who certainly should not have been convicted in para 9(1). Dyson LJ set the scene for a discussion of this issue in these appeals in para 19 of his judgment in R (Adams) v Secretary of State for the Home Department [2009] EWCA Civ 1291, [2010] QB 460, when he said: The question what is meant by miscarriage of justice has not been resolved by the courts. As Toulson LJ said when giving permission to appeal in the present case, there are at least three classes of case where the Court of Appeal allows an appeal against conviction on the basis of fresh evidence. I shall call them category 1, category 2 and category 3 cases. A category 1 case is where the court is sure that the defendant is innocent of the crime of which he has been convicted. An obvious example is where DNA evidence, not obtainable at the trial, shows beyond reasonable doubt that the defendant was not guilty of the offence. A category 2 case is where the fresh evidence shows that he was wrongly convicted in the sense that, had the fresh evidence been available, no reasonable jury could properly have convicted. An example is where the prosecution case rested entirely on the evidence of a witness who was put forward as a witness of truth and fresh evidence undermines the creditworthiness of that witness, so that no fair minded jury could properly have convicted on the evidence of that witness. It does not follow in a category 2 case that the defendant was innocent. A category 3 case is where the fresh evidence is such that the conviction cannot be regarded as safe, but the court cannot say that no fair minded jury could properly convict if there were to be a trial which included the fresh evidence. The court concludes that a fair minded jury might convict or it might acquit. There is a fourth category of case to which Lord Bingham referred in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1. This is where a conviction is quashed because something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who should not have been convicted. This list of the different types of case where appeals are allowed according to the practice of the Court of Appeal (Criminal Division) was used in argument to focus the positions adopted by either side in these appeals. It was assisted later in the judgment by an acknowledgment that there were two limbs to Lord Binghams interpretation as set out in his speech in Mullen, para 4: [2010] QB 460, para 43. The first limb was where the person was innocent of the crime of which he had been convicted: category 1 according to Toulson LJs analysis. The second limb was where something had gone seriously wrong in the investigation or the conduct of the trial and the person should clearly not have been convicted. For the Secretaries of State it was submitted that only cases falling within category 1 would satisfy the requirements of section 133(1). For Adams Mr Owen QC submitted that it was not possible to draw a clear line between categories 2 and 3, so it was sufficient for him to bring his case within category 3. In any event, he submitted that Lord Binghams interpretation of the phrase in his second limb in Mullen was to be preferred, that proof of innocence was not required and that his case came within category 4. Counsel for the appellants McCartney and MacDermott submitted that Lord Binghams interpretation was to be preferred, and that their cases too fell within his second limb and category 4. It would be wrong to regard the way these categories were identified and described by the Court of Appeal as a substitute for looking at the language of section 133(1) itself and reaching our own view as to its effect. Lord Bingham said in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1, para 2 that he would allow the Secretary of States appeal on a narrow ground which made it unnecessary for him to reach a concluded view as to whether the right to compensation under the statute was available only to those who were innocent of the crime of which they had been convicted. We do not have that luxury in the cases that are before us in these appeals. A choice has to be made. It is time to take a fresh look at the arguments. Our task is made less onerous, although no less difficult, by the fact that the materials that were said to be relevant were discussed so fully by Lord Bingham and Lord Steyn in Mullen. It is striking how little assistance they were able to derive from the materials that were before the House. On many points both Lord Steyn and Lord Bingham were in agreement. They were agreed that the wording of section 133(1) was intended, as Lord Bingham put it in para 9, to reflect article 14(6). In para 5 he said that the parties were rightly agreed that the key to interpretation of section 133 was a correct understanding of article 14(6). They were also agreed that, as Lord Bingham said in para 9(1), the expression miscarriage of justice is not a legal term of article Taken on its own and out of context, it has no settled meaning. Lord Steyn said that the expression had to be looked at in the relevant international context, and that the only relevant context here was the international meaning of the words in article 14(6) on which section 133 is based: para 36. The question then was, what did the materials reveal as to its international meaning? The travaux prparatoires disclosed no consensus of opinion on the meaning to be given to it. Lord Steyn said that they were neutral and did not assist in any way on the proper construction of article 14(6): para 54. Lord Bingham seems to have seen this as a possible pointer towards a more generous interpretation. He said that the expression miscarriage of justice may have commended itself because of the latitude of interpretation that it offered: para 9(2). But this was no more than a straw in the wind. The jurisprudence of the United Nations Human Rights Committee was of little assistance either indeed, Lord Steyn does not mention it at all. And there was no consensus of academic opinion on the issue. In this situation Lord Steyn resorted first to an examination of article 14(6) on its own terms: para 45. Lord Bingham did not undertake this exercise. Instead he took as his starting point the statements that Mr Jenkins and Mr Hurd made when they were explaining the ex gratia scheme to Parliament: para 4. As he said at the outset of this paragraph, they were addressing the subject of wrongful convictions and charges. He observed that, like the expression miscarriage of justice, the expression wrongful convictions is not a legal term of art and it has no settled meaning. He then set out to describe in some detail the situations to which in ordinary parlance, as he put it, the expression would be taken to extend. Here we find the first and second limbs, as Dyson LJ in the Court of Appeal described them at [2010] QB 460, para 43, set out. The first is the conviction of those who are innocent of the crime of which they were convicted. The second embraces cases where those who, whether guilty or not, should not have been convicted. The manifold reasons where this might happen were impossible and unnecessary to identify. The common factor however was that something had gone seriously wrong in the investigation of the offence or the conduct of the trial. It is important not to lose sight of the fact that Lord Bingham was not seeking in para 4 to describe what, in the context of article 14(6), was meant by the expression miscarriage of justice. He was concentrating here on the expression wrongful conviction in the statements about the ex gratia scheme. He did not refer to the fact that it is a precondition of the right to compensation under article 14(6), and in its turn section 133, that the conviction was reversed because of a new or newly discovered fact. The descriptions of the ex gratia scheme did not mention this as a prerequisite. Quite what part this discussion had to play in the interpretation of article 14(6), to which he turned in para 5, is unclear. He took account of the fact that in the course of his statement Mr Hurd recited the terms of, and undertook to observe, article 14(6): para 5. There is an indication in that paragraph that he saw the only difference between that part of Mr Hurds statement and the enactment of section 133 as being that the right to be compensated should more obviously be, as article 14(6) requires, according to law. But, as he said at the end of that paragraph, the task of the House was to interpret section 133. He did not say and it would have been surprising if he had done that the key to this was to be found in Mr Hurds description of the cases where he was willing to pay compensation for a wrongful conviction under the ex gratia scheme. When he said at the end of para 8 that it is for failures of the trial process that the Secretary of State is bound by section 133 and article 14(6) to pay compensation, he was not offering a considered view as to what those provisions actually mean. He was explaining why, because there was no failure in the trial process, he could decide the case against Mullen on that limited ground without forming a concluded view as to what the convicted person had to show to be entitled to compensation. In R (Clibery) v Secretary of State for the Home Department [2007] EWHC 1855 (Admin), para 25, Lord Phillips of Worth Matravers CJ said that in para 4 of his speech in Mullen Lord Bingham considered two different situations, each of which he (that is, Lord Bingham) considered fell within the description of miscarriage of justice in section 133 of the 1988 Act. It is true, as Lord Phillips went on to point out, that in para 6 of his speech Lord Bingham referred to the core right with which article 14(6) is concerned as the right to a fair trial. But I think, with respect, that Lord Phillips was wrong to say that in para 4 of his speech Lord Bingham was considering what was meant by miscarriage of justice in section 133, as he himself has accepted: see para 30, above. Hughes LJ drew attention to this point in R (Allen) (formerly Harris) v Secretary of State for Justice [2009] 2 All ER 1, para 25. He said that it must be remembered that in Mullen both the statutory and the ex gratia schemes were under consideration. In my opinion the value of Lord Binghams speech in Mullen lies not in any attempt on his part to subject section 133 to textual analysis, for he did not do this. It is to be found in the reasons he gave for hesitating to accept the argument for the Secretary of State that section 133 was satisfied only when the defendant was shown beyond reasonable doubt to have been innocent of the crime of which he had been convicted, and in particular in the three points on which he disagreed with Lord Steyn. Lord Steyns textual analysis of article 14(6) begins with a warning that there was no overarching purpose of compensating all who are wrongly convicted. For the reasons he gives in para 45, the fundamental right under article 14(6) is narrowly circumscribed. There was no intention to compensate all those whose convictions were quashed within the ordinary time limits, only those whose convictions were quashed on appeal out of time. And this was only where a new or newly discovered fact showed conclusively that there had been a miscarriage of justice. Having made this point, he then concentrated in para 46 on the requirement that the new or newly discovered fact must show conclusively (or beyond reasonable doubt in the language of section 133) that there has been a miscarriage of justice. He said that this filtered out cases of two kinds, (1) where there may have been a wrongful conviction and (2) where it is only probable that there may have been a wrongful conviction. He concluded that the only relevant context pointed to a narrow interpretation, that is to say the case where innocence is demonstrated. This approach leans very heavily on the use of the word conclusively. That word certainly points towards a narrow interpretation. But it does not point inevitably to the demonstration of innocence as the only case that could qualify for compensation under the article. The fact that a person who has been pardoned is brought within the scheme does not have that effect either. It would plainly have been wrong to exclude those who are pardoned from the scheme when those whose convictions have been reversed are given the benefit of it. But the reversal of a conviction and a pardon are processes which are distinct from each other. It does not follow from the mere fact that they are both covered by the same scheme that the only reversals of convictions that can be contemplated are those which would otherwise have deserved a pardon. Lord Steyn might have examined these points more fully, had he not been persuaded by two considerations to which he then turned that he had found the right answer. The first was the use of the words une erreur judiciaire in the French text of the ICCPR. In para 47 of his speech in Mullen Lord Steyn said that this was a technical expression indicating a miscarriage of justice in the sense of the conviction of the innocent. In para 9(4) of his speech Lord Bingham expressed some unease about this, as he contrasted these words with the reference to un condamn reconnu innocent in article 626 of the French Code de Procdure Pnale. He said that the expression une erreur judiciaire could be understood as equivalent to miscarriage of justice in its broad sense, and that it was not obviously apt to denote proof of innocence. In In re Boyles Application [2008] NICA 35, para 11 Girvan LJ said that he considered that Lord Binghams hesitation in not accepting Lord Steyns stringent requirement of proof of innocence was justified. In para 12 he pointed out that the term erreur judiciaire is defined by Grard Cornu in his Vocabulaire Juridique, 7th ed (1998), as une erreur de fait commise par une juridiction de jugement dans son appreciation de la culpabilit dune personne poursuivie. In para 13 he enlarged on Lord Binghams reference to article 626 of the Code de Procdure Pnale, pointing out that it did not require proof of innocence but rather that, where a defendants conviction is quashed and he is subsequently acquitted, he is reconnu innocent in consequence in other words, the annulment of the conviction itself leads to the establishment of his innocence. Although Mr Tam QC for the Secretary of State sought to defend Lord Steyns interpretation in his written case, he accepted in the course of Mr Owens oral argument that it was probably incorrect. For my part, I think that Girvan LJs researches have shown that Lord Steyns understanding of the words une erreur judiciaire in the French text of article 14(6), for which he gave no authority, was mistaken. The second consideration on which Lord Steyn relied was an observation in para 25 of an explanatory report by the Steering Committee for Human Rights appointed by the Council of Europe which accompanied the Seventh Protocol of the European Convention when it was published in November 1984: Mullen, para 48. It said of article 3, which follows the wording of article 14(6) of the ICCPR, that the intention was that states would be obliged to compensate persons only in clear cases of miscarriage of justice, in the sense that there would be an acknowledgment that the person concerned was clearly innocent. Having noted that in the introduction to the report it was stated that participation in the Protocol would not affect the application of provisions containing obligations under any other international instrument, Lord Steyn said that the explanatory report nevertheless had great persuasive value in the process of interpretation. In para 9(4), on the other hand, Lord Bingham set out five reasons for thinking that this passage does not bear the weight that Lord Steyn attached to it. Among those reasons are two which seem to me to be particularly significant. First, many more states are parties to the ICCPR than to the European Convention or the Seventh Protocol, which the United Kingdom has not signed or ratified. Second, para 25 does not appear to be altogether consistent with para 23, which suggests that a miscarriage of justice occurs where there is a serious failure in the judicial process involving grave prejudice to the convicted person. Furthermore, as Lord Bingham noted in para 9(5), van Dijk and van Hoof, Theory and Practice of the European Convention on Human Rights, 3rd ed (1998), p 689 take a different view, suggesting that the explanatory reports interpretation is too strict and that reversal of the conviction on the ground that new facts have been discovered which introduce a reasonable doubt as to the guilt of the accused is enough. Lord Steyn said in para 48 that the explanatory report had great persuasive value. I think that, for the reasons Lord Bingham gives, this overstates the position. The better view is that it lends some support the Secretary of States argument, but that it must be for the court to work out for itself what the words mean. There was one further difficulty about Lord Steyns interpretation to which Lord Bingham drew attention in para 9(6). This is that courts of appeal, although well used to deciding whether convictions are safe or whether reasonable doubts exist about their safety, are not called upon to decide whether a defendant is innocent and in practice rarely do so. In R (Allen) (formerly Harris) v Secretary of State for Justice [2009] 2 All ER 1, para 40(iii) Hughes LJ said that cases where the innocence of the convicted defendant is genuinely demonstrated beyond reasonable doubt by the new or newly discovered fact will be identifiable in that court and the judgment will, in virtually every case, make this plain. I do not think that this entirely meets Lord Binghams point. I have no doubt that there will be cases of the kind that Hughes LJ describes. But it remains true that courts of appeal are not called upon to say whether or not a defendant was innocent, and it is at least questionable whether restricting the right to compensation to cases where the establishment of innocence is apparent from the courts judgment imposes too severe a test for the entitlement to compensation. A fresh analysis If one accepts, as I would do, Lord Binghams reasons for doubting whether Lord Steyn was right to find support for his reading of article 14(6) in the French text and in para 25 of the explanatory committees report on article 3 of the Seventh Protocol, one is driven back to the language of the article itself as to what the words miscarriage of justice mean. Taken by itself this phrase can have a wide meaning. It is the sole ground on which convictions can be brought under review of the High Court of Justiciary in Scotland: Criminal Procedure (Scotland) Act 1995, section 106(3). But the fact that these words are linked to what is shown conclusively by a new or newly discovered fact clearly excludes cases where there may have been a wrongful conviction and the court is persuaded on this ground only that it is unsafe. It clearly includes cases where the innocence of the defendant is clearly demonstrated. But the article does not state in terms that the only criterion is innocence. Indeed, the test of innocence had appeared in previous drafts but it was not adopted. I would hold, in agreement with Lord Phillips (see para 55 above) that it includes also cases where the new or newly discovered fact shows that the evidence against the defendant has been so undermined that no conviction could possibly be based upon it. In that situation it will have been shown conclusively that the defendant had no case to answer, so the prosecution should not have been brought in the first place. There is an important difference between these two categories. It is one thing to be able to assert that the defendant is clearly innocent. Cases of that kind have become more common and much more easily recognised since the introduction into the criminal courts, long after article 14(6) of the ICCPR was ratified in 1976, of DNA evidence. It seems unlikely that the possibility of demonstrating innocence in this way was contemplated when the test in article 14(6) was being formulated. Watson and Crick published their discovery of the double helix in 1951, but DNA profiling was not developed until 1984 and it was not until 1988 that it was used to convict Colin Pitchfork and to clear the prime suspect in the Enderby Murders case. The state should not, of course, subject those who are clearly innocent to punishment and it is clearly right that they should be compensated if it does so. But it is just as clear that it should not subject to the criminal process those against whom a prosecution would be bound to fail because the evidence was so undermined that no conviction could possibly be based upon it. If the new or newly discovered fact shows conclusively that the case was of that kind, it would seem right in principle that compensation should be payable even though it is not possible to say that the defendant was clearly innocent. I do not think that the wording of article 14(6) excludes this, and it seems to me that its narrowly circumscribed language permits it. The range of cases that will fall into the category that I have just described is limited by the requirement that directs attention only to the evidence which was the basis for the conviction and asks whether the new or newly discovered fact has completely undermined that evidence. It is limited also by the fact that the new or newly discovered fact must be the reason for reversing the conviction. This suggests that it must be the sole reason, but I do not see the fact that the appellate court may have given several reasons for reversing the conviction as presenting a difficulty. All the other reasons that it has given will have to be disregarded. The question will be whether the new or newly discovered fact, taken by itself, was enough to show conclusively that there was a miscarriage of justice because no conviction could possibly have been based on the evidence which was used to obtain it. For these reasons it is plain that category 1 in Dyson LJs list (see para 83, above) falls within the scope of section 133. I think that it is equally plain that category 4 (Lord Binghams second limb) does not, as it is taken from para 4 of Lord Binghams speech in Mullen where he was discussing what was included within the phrase wrongful convictions, not what was meant by section 133. This leaves category 2, where the fresh evidence shows that the defendant was wrongly convicted in the sense that, had the fresh evidence been available, no reasonable jury could properly have convicted; and category 3, where the fresh evidence is such that the conviction cannot be regarded as safe, but the court cannot say that no fair minded jury could properly convict if there were to be a trial which included the fresh evidence. Bearing in mind that we must form our own view as to what section 133 means, can the wording of that section on a correct understanding of article 14(6) include either or both of these categories? I have put the words fresh evidence, which of course echo the wording of section 23 of the Criminal Appeal Act 1968 (see also section 106(3) of the Criminal Procedure (Scotland) Act 1995), into inverted commas because they depart from the words of section 133. The statute, like article 14(6), refers to a new, or newly discovered fact, not to fresh evidence. And it must be a fact which shows beyond reasonable doubt, or conclusively, that there was a miscarriage of justice. Fresh evidence does not attain that status until the matter to which it relates has been proved or has been admitted to be true. Fresh evidence that justifies the conclusion referred to in category 3 will usually not be, and certainly need not be, of that character. If it shows that the conviction is merely unsafe, the court may order a retrial. Under our system of trial by jury there will be no way of knowing, beyond reasonable doubt, whether it was a new or newly discovered fact that led to the acquittal. For these reasons I would exclude category 3 from the scope of section 133. This leaves category 2. As Hughes LJ indicates in R (Allen) (formerly Harris) v Secretary of State for Justice [2009] 2 All ER 1, para 40(iii), we are dealing here with a new or newly discovered fact that is identifiable as such by the Court of Appeal. Category 2, as described in Dyson LJs list, is of course accurate as a description of what happens according to the Court of Appeals practice. But it is too broadly framed for use as a reliable guide to what falls within the scope of section 133 read with article 14(6). It lacks the limiting factors indicated by the words new or newly discovered fact and shows conclusively. It may not be easy in practice to distinguish cases that fall within it from those that fall within category 3. So in my opinion a more precise, and more exacting, formula must be found. I am uneasy too about requiring the Secretary of State, whose function it is to administer the scheme under the statute, to apply a test which refers to what a reasonable jury would do. This is a judgment that is best left to the courts. While he will be guided by what the appellate court said when it reversed the conviction, he is entitled to look at the new or newly discovered fact for himself and draw his own conclusions as to its consequences so long as they are not in conflict with what the court has said in its judgment. This brings me back to what I said in para 94 above. For the reasons I give there I would rephrase category 2, so that it fits with the narrowly circumscribed language of article 14(6) and section 133. I would limit it to cases where the new or newly discovered fact shows conclusively that there was a miscarriage of justice because the evidence that was used to obtain the conviction was so undermined by the new or newly discovered fact that no conviction could possibly be based upon it. This would include cases where the prosecution depended on a confession statement which was later shown by a new or newly discovered fact to have been inadmissible because, as the defendant had maintained all along, it was extracted from him by improper means. It may be quite impossible to say in such a case that he was, beyond reasonable doubt, innocent. But, as the evidence against him has been completely undermined, it can be said that it has been shown beyond reasonable doubt, or conclusively, that there has been a miscarriage of justice in his case which was as great as it would have been if he had in fact been innocent, because in neither case should he have been prosecuted at all. Retrial Section 133(5A), which was inserted by section 61 of the Criminal Justice and Immigration Act 2008, changed the timetable as to when a persons conviction was to be taken to have been reversed in a case where a retrial is ordered. This amendment has to be read with the amendment which was made at the same time to section 133(2) by inserting a time limit for making an application for compensation under section 133. This is a period of two years beginning with the date when the conviction is reversed. Section 133(5A) provides that where the person is to be subject to a new trial the conviction is not to be treated as reversed unless and until the person is acquitted of all offences at the retrial or the prosecution indicates that it has decided not to proceed with the retrial. This provision introduces a feature of the statutory scheme which was not before the House in Mullen. But I do not think that it affects Lord Steyns interpretation of section 133, or the qualification which I would make to it to include cases where the prosecution should never have been brought. It is not to be taken as suggesting that compensation is payable in every case where the appellate court has ordered a new trial because it is satisfied that the conviction was unsafe in the light of fresh evidence. What it does, as it seems to me, is to allow for the possibility that something may emerge either before or during the retrial which would require compensation to be paid. Nor is it to be taken as suggesting that compensation is payable in every case, such as that of Mr George, where the person was acquitted at his retrial. The tests laid down in section 133(1) must still be applied. It is only where a new fact or a newly discovered fact shows conclusively that the person was innocent or that the prosecution should never have been brought that there will be a right to compensation. This will not be the case where a retrial has been ordered, and it may not be apparent from the jurys verdict at the retrial. The fact that it returned a verdict of not guilty will not be enough. But if new facts emerge during the retrial process that have the effect of showing conclusively that the person was innocent or that the prosecution should never have been brought they can be taken into account, even though they emerged after the date when the conviction was reversed by the Court of Appeal. New or newly discovered fact A question that is raised in Adamss case is to whom these words are addressed. His appeal was allowed by the Court of Appeal on the basis that, owing to inadequacies in the conduct of his case by his then legal team, there had been a failure by them to discover and make use at the trial of three pieces of important material which had been made available to them by the prosecution but of which Adams himself was not aware: [2007] 1 Cr App R 449, para 155. In other words, this was material that was available at the trial but not used. Could it be said that these were new or newly discovered facts? His case is that all he needed to show was that he himself was unaware of them. They were new to him because they were not revealed to him by his legal team. They did not have to be new, as the Secretary of State maintains, to everyone involved in the trial. The Divisional Court (Maurice Kay LJ and Simon J) held that the Secretary of State was right to reject Adamss claim for compensation on the ground that his conviction was not quashed because of a new or newly discovered fact: [2009] EWHC 156 (Admin). The Court of Appeal (Waller, Dyson and Lloyd LJJ) disagreed, for three reasons: [2010] QB 460, paras 14 16. First, it was difficult to accept that those who drafted the article intended to deny compensation to a person whose conviction was reversed on the basis of material which was available to his legal team and would have shown that he was innocent. Second, there was no need to interpret the phrase in a way that yielded such an extreme result. Third, the focus of the language was on the convicted person. There was no mention of his legal representatives in the article. So compensation was not to be denied to him if facts emerged that were new to him, although they were known to his legal representatives. I do not think that the language of article 14(6) bears this interpretation. It seems to me that the focus of attention is on what was known or not known to the trial court, not to the convicted person. The assumption is that the trial court did not take the fact into account because it was not known or had not been discovered at the time of the trial. If this was attributable wholly or in part to the convicted person because he deliberately chose not to reveal what he knew to his defence team compensation must be denied to him, as the coda to article 14(6) makes clear. But, leaving that point out of account, the only relevant questions are whether it was not available to the trial court because it was not known then at all or whether, although knowable, it had not been discovered by the time of the trial. Material that has been disclosed to the defence by the time of the trial cannot be said to be new or to have been newly discovered when it is taken into account at the stage of the out of time appeal. To focus on the state of mind of the convicted person goes too far. It ignores the fact that in practice the defendants legal representatives are unlikely to have discussed with him every piece of information that they come across in the course of their preparation for and conduct of the trial. I agree with Lord Judge that a fact is not new or newly discovered for the purposes of section 133 just because the defendant himself, who was previously unaware of that fact, ceases to be ignorant of it. Does denial of compensation infringe the presumption of innocence? Mr Owen submitted that a narrow interpretation of article 14(6) would conflict with the presumption of innocence in article 6(2) of the European Convention. He relied on a series of decisions by the European Court of Human Rights which show that the presumption of innocence may be violated in particular circumstances where, following an acquittal, a court or other authority expresses an opinion of continuing suspicion which amounts in substance to a determination of guilt of the person concerned: Sekanina v Austria (1993) 17 EHRR 221; Leutscher v The Netherlands (1996) 24 EHRR 181; Rushiti v Austria (2000) 33 EHRR 1331; Weixelbraun v Austria (2001) 36 EHRR 799; Orr v Norway (Application No 31283/04) (unreported) 15 May 2008; and Hammern v Norway (Application No 30287/96) (unreported) 11 February 2003. These cases, other than Orr v Norway, were examined in Mullen by Lord Bingham in para 10 and by Lord Steyn in paras 41 44. Mr Owen said that the reasons that Lord Steyn gave for finding these cases of no assistance on the question as to whether article 6(2) requires an expansive interpretation of article 3 of the Seventh Protocol or of article 14(6) of the ICCPR were correct but irrelevant. Lord Bingham on the other hand said in para 10 that they were of no assistance, since Mullens acquittal was based on matters entirely unrelated to the merits of the accusation against him. So it was open to this court to take a fresh look at the issue. As Mr Tam for the Secretary of State pointed out, article 6(2) applies according to its own terms to the criminal process. The Strasbourg cases show that its jurisprudence is designed to protect the criminal acquittal in proceedings that are closely linked to the criminal process itself. In Sekanina v Austria (1993) 17 EHRR 221, para 30, for example, the court said that the voicing of suspicions regarding a persons innocence is conceivable as long as the conclusion of criminal proceedings has not resulted in a decision on the merits but that it was no longer admissible to rely on such suspicions once an acquittal has become final. That was a case where the applicant had been charged with murder and remanded in custody but was subsequently acquitted at his trial. His claim for compensation was dismissed on the ground that there were still strong suspicions regarding his guilt. The problem was that Austrian legislation and practice linked the two questions the criminal responsibility of the accused and the right to compensation to such a degree that the decision on the latter issue could be seen to be regarded as a consequence and, to some extent, the concomitant of the decision on the former: para 22. The court was careful to point out in para 25, however, that the situation in that case was not comparable to that governed by article 3 of the Seventh Protocol. This distinction shows that a person might properly be refused compensation under that article, and thus under article 14(6) of the ICCPR which marches together with article 3 of the Seventh Protocol, without violating the presumption of innocence under article 6(2). The same approach was taken in Hammern v Norway (Application No 30287/96) 11 February 2003 where the conditions for obtaining compensation were linked to the issue of criminal responsibility in such a manner, by the same court sitting largely in the same formation, so as to bring the proceedings within the scope of article 6(2): para 46. A further example of this line of reasoning is provided by Y v Norway (2003) 41 EHRR 87, where the applicant was acquitted by the High Court which then went on to refuse his claim for compensation the next day on the ground that it was clearly probable that he had committed the offences with which he had been charged. So too in Orr v Norway (Application No 31283/04) 15 May 2008, where the High Court dealt with the acquittal and the payment of compensation to the complainant in two clearly distinct parts of its judgment, but in several places highlighted that the standard of proof for civil liability to pay compensation was less strict than for criminal liability: para 52. This was held in para 53 to cast doubt on the correctness of the acquittal. The principle that is applied is that it is not open to the state to undermine the effect of the acquittal. What article 14(6) does not do is forbid comments on the underlying facts of the case in subsequent proceedings of a different kind, such as a civil claim of damages, when it is necessary to find out what happened. The system that article 14(6) of the ICCPR provides does not cross the forbidden boundary. The procedure laid down in section 133 provides for a decision to be taken by the executive on the question of entitlement to compensation which is entirely separate from the proceedings in the criminal courts. As Lord Steyn pointed out in Mullen, paras 41 43, in none of the cases from Austria or Norway, nor in Leutscher v The Netherlands 24 EHRR 181, was the court called upon to consider the interaction between article 6(2) and article 3 of the Seventh Protocol. On the contrary, the fact that the court was careful to emphasise in Sekanina v Austria, para 25 that the situation in that case was not comparable to that governed by article 3 of the Seventh Protocol is an important pointer to the conclusion that, as Lord Steyn put it in Mullen, para 44, article 14(6) and section 133 of the 1988 Act are in the category of lex specialis and that the general provision for a presumption of innocence does not have any impact on them. A refusal of compensation under section 133 on the basis that the innocence of the convicted person has not been clearly demonstrated, or that it has not been shown that the proceedings should not have been brought at all, does not have the effect of undermining the acquittal. Conclusions I would dismiss the appeal by Adams on the ground that the phrase new or newly discovered fact does not encompass the material that was available to but not used at the trial by the convicted persons legal representatives. But I would add that the second limb of the test that has been attributed to Lord Bingham because of what he said in para 4 of his speech in Mullen, on which Mr Owen relied, does not meet the requirements of article 14(6). So, even if the material in question could be said to have been newly discovered, his case would not have entitled him to compensation under the statute. I would allow the appeals by McCartney and MacDermott, for the reasons given by Lord Kerr. It is not possible to say in their cases that the newly discovered facts show conclusively that they were innocent of the crimes of which they were convicted. But it is possible to say, in the light of the newly discovered facts, that these were proceedings that ought not to have been brought because the evidence against them has been so completely undermined that no conviction could possibly be based upon it. I would hold that their cases fall within the narrowly circumscribed language of article 14(6) and section 133 of the 1988 Act, and they are entitled to be compensated. LADY HALE I agree that a miscarriage of justice in section 133 of the Criminal Justice Act 1988 (see para 1 above) should be interpreted as proposed by Lord Phillips in para 55 of his judgment. The phrase is clearly capable of bearing a wider meaning than conclusive proof of innocence. Both the inspiration for section 133, in article 14(6) of the ICCPR (see para 6 above) and the meaning of miscarriage of justice in domestic law in 1988 support a wider meaning. The drafters of article 14(6) rejected all attempts to confine it to proof of innocence. In 1988, the Criminal Appeal Act 1968 permitted the Court of Appeal to dismiss an appeal if they considered that no miscarriage of justice has actually occurred (section 2(1) before its amendment by the Criminal Appeal Act 1995). This points strongly to the meaning of miscarriage of justice as the conviction of someone who ought not to have been convicted. The addition in section 133 of the requirement that this be shown beyond reasonable doubt (in substitution for conclusively in article 14(6)) indicates that this refers to someone who definitely should not have been convicted rather than to someone who might or might not have been convicted had we known then what we know now. As I understand it, Lord Phillips formulation, with which both Lord Hope and Lord Kerr agree, would limit the concept to a person who should not have been convicted because the evidence against him has been completely undermined. Unlike Lord Clarke, therefore, he would not include a person who should not have been convicted because the prosecution was an abuse of process. I agree with Lord Phillips that the object of this particular exercise is to compensate people who cannot be shown to be guilty rather than to provide some wider redress for shortcomings in the system. I do sympathise with Lord Browns palpable sense of outrage that Lord Phillips test may result in a few people who are in fact guilty receiving compensation. His approach would of course result in a few people who are in fact innocent receiving no compensation. I say a few because the numbers seeking compensation are in any event very small. But Lord Phillips approach is the more consistent with the fundamental principles upon which our criminal law has been based for centuries. Innocence as such is not a concept known to our criminal justice system. We distinguish between the guilty and the not guilty. A person is only guilty if the state can prove his guilt beyond reasonable doubt. This is, as Viscount Sankey LC so famously put it in Woolmington v Director of Public Prosecutions [1935] AC 462, at p 481, the golden thread which is always to be seen throughout the web of the English criminal law. Only then is the state entitled to punish him. Otherwise he is not guilty, irrespective of whether he is in fact innocent. If it can be conclusively shown that the state was not entitled to punish a person, it seems to me that he should be entitled to compensation for having been punished. He does not have to prove his innocence at his trial and it seems wrong in principle that he should be required to prove his innocence now. Of course, it is not enough that the evidence supporting his conviction has been fatally undermined. This has to be because of a new or newly discovered fact. On this point, I also agree with Lord Phillips, who adopts the definition contained in section 9(6) of the Criminal Procedure Act 1993 in Ireland (see para 60). This means that the person convicted either did not know or did not appreciate the significance of the information in question. It seems difficult to make sense of the proviso to section 133(1) unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted in any other way. For these reasons, in agreement with Lord Phillips, I would dismiss Mr Adams appeal but allow the appeals of Mr MacDermott and Mr McCartney. The evidence against Mr Adams has not been so undermined that no conviction could possibly be based upon it, whereas Lord Kerr has demonstrated that this is indeed the case with Mr MacDermott and Mr McCartney. LORD KERR The appeals of Eamonn MacDermott and Raymond McCartney Introduction On 12 January 1979, after a trial by a judge, sitting without a jury at Belfast City Commission, Raymond Pius McCartney was convicted of two offences of murder and one of membership of the Irish Republican Army. The two murder victims were Geoffrey Agate and Detective Constable Liam Patrick McNulty. Mr McCartney was sentenced to life imprisonment on each of the murder counts and to five years imprisonment for the offence of membership of a proscribed organisation. On the same date and at the same court Eamonn MacDermott was convicted of various offences including the murder of Detective Constable McNulty. He was sentenced to life imprisonment for that offence and to various terms of imprisonment for the other offences. The sole evidence on which Mr McCartney and Mr MacDermott were convicted consisted of written and verbal admissions that they were said to have made during interviews by police. Both contested the admissibility of the statements, alleging that they had either been the product of ill treatment by interviewing police officers or that they had been concocted. The admissibility of the statements was considered by the trial judge after a long voire dire hearing. He rejected the allegations of the appellants and stated that he was satisfied that neither had been ill treated. The judge also considered whether to exercise his residual discretion to exclude the statements from evidence if he considered it proper to do so. He concluded that it would not be proper to do so and the statements were duly admitted. An appeal by Mr MacDermott and Mr McCartney against their convictions was dismissed by the Court of Appeal in Northern Ireland (Jones LJ, Gibson LJ and Kelly J) on 29 September 1982. Both spent several years in prison. On 18 January 2006 the Criminal Cases Review Commission referred the convictions of Mr MacDermott and Mr McCartney to the Court of Appeal. On 15 February 2007 their convictions were quashed, the Court of Appeal declaring that they had a distinct feeling of unease about their safety. Following the quashing of their convictions by the Court of Appeal, Mr McCartney and Mr MacDermott applied to the Secretary of State for Northern Ireland for compensation under section 133 of the Criminal Justice Act 1988 on the basis that they had been victims of a miscarriage of justice. The applications were refused. They then sought judicial review of that decision. The application for judicial review was rejected by Weatherup J on 25 June 2009. An appeal against that decision was dismissed by the Court of Appeal in Northern Ireland (Morgan LCJ, Girvan LJ and Coghlin LJ) on 8 February 2010. The appellants trials Mr McCartney Mr McCartneys case on trial had been that he did not make any verbal admissions and that the two written statements attributed to him had been fabricated by police officers. He claimed that he had been ill treated before each statement had been written out. He had refused to sign them but he had initialled the caution that appeared at the head of the first statement and had drawn a line and had written the words "end of statement" at the concluding part of the second statement. Mr McCartney claimed that his ill treatment began during the second of a series of interviews that took place in Castlereagh Police Office between 3 and 7 February 1977. The ill treatment continued during a number (although not all) of the succeeding interviews. Two police officers in particular were identified by him as having been the most persistent and determined perpetrators. He gave evidence that he had been told that they had been specially chosen in order to extract confessions from him. The suggestion was made by Mr McCartneys counsel that proper supervision of interviews had broken down and that a concerted campaign of abuse had been conducted in order to obtain confessions that would lead to convictions. The interviewing police officers denied that they had been guilty of any form of ill treatment. Superior officers rejected the suggestion that there had been any lack of supervision or that particular officers were chosen in order to extract confessions. It was accepted, however, that a new team of detectives had been selected to continue interviews with Mr McCartney on the second day of interviewing. This new team was chosen, according to one of the senior officers in charge of interviews, because Mr McCartney, despite having shown signs of co operation on the first evening of interviews, had evinced a less co operative attitude the following day. The detectives thus selected were those identified by Mr McCartney as his principal abusers. During the course of Mr McCartneys trial, an application was made on his behalf for leave to call three witnesses who had been arrested at the same time as he and who had been interviewed at Castlereagh Police Office during the same period. In the event, two of the witnesses gave evidence. One of these was a man called John Thomas Pius Donnelly. He had been arrested at the same time as Mr McCartney. He was interviewed about and subsequently charged with one of the murders of which Mr McCartney was later convicted. He was also charged with having caused an explosion. For reasons that will appear presently, the charges against Mr Donnelly were not proceeded with and he did not stand trial. During the trial of Mr McCartney and Mr MacDermott, Mr Donnelly gave evidence that he had been subjected to serious assaults during his interviews and had sustained significant injuries in consequence. Although the detectives who, according to Mr Donnelly, had assaulted him, Detective Constable French and Detective Constable Newell, were not those who were alleged to have ill treated Mr McCartney, they were members of the group of officers who had been conducting interviews into the murders of Mr Agate and Detective Constable McNulty. Detective Constable French had interviewed Mr MacDermott and had recorded the most significant statement of admission from him. Mr MacDermott alleged that he had been assaulted by Detective Constable French and by the officer who accompanied him, Detective Constable Dalton. This second detective had also interviewed Mr McCartney and Mr McCartney claimed to have been assaulted by him also. On 6 February 1977, after he had been interviewed for several days, two doctors carried out a joint examination of Mr Donnelly. One of them was a forensic medical officer, retained by the police. No fewer than ten areas of injury on Mr Donnellys body were recorded. Substantial bruising, particularly in the abdominal area was found. The trial judge observed that both doctors were shocked and horrified by what they found on examination. How Mr Donnellys injuries had been caused was the subject of acute controversy on trial. It was trenchantly put to him by counsel for the prosecution that some had been sustained during a series of struggles while he was being taken to and from interview rooms and that the remaining injuries were self inflicted. This was a highly significant cross examination when seen in the light of the subsequently discovered reasons that the charges against Mr Donnelly had not been proceeded with. The decision not to proceed with the prosecution of Mr Donnelly was itself highly significant for he was alleged to have made verbal and written admissions of murder and causing an explosion. The second witness, Hugh Brady, also gave evidence of having been assaulted during interviews which took place during the same period as those of Mr McCartney and Mr Donnelly. One of the detectives identified by Mr Brady as having assaulted him (Detective Constable Dalton) had also interviewed Mr McCartney and, as noted at para 126 above, Mr McCartney claimed that he too had been assaulted by this officer. Mr Brady was also found on medical examination to have multiple injuries, most notably bruising of the abdomen and a burn to his hand which he claimed had been caused by the hand being forcibly held against a hot radiator. One of the doctors who examined him, Dr Hendron, who had been retained by Mr Bradys solicitors, concluded his medical report by saying that he had no doubt that Mr Brady had been assaulted, although he conceded during cross examination at the trial of Mr McCartney and Mr MacDermott that Mr Brady may have exaggerated. Other doctors who examined Mr Brady believed that he had exaggerated and gave evidence to that effect. Mr Brady did not make admissions and was not charged with any offences. Under cross examination at the trial of Mr McCartney and Mr MacDermott it was also suggested to him that his injuries had been self inflicted. The trial judge, MacDermott J, did not find him an impressive witness for reasons that I will turn to presently. Mr McCartney was examined by two doctors, Dr Henderson, the Force medical officer and Dr Hendron, who attended at the request of Mr McCartneys solicitors. The medical examination took place shortly after the tenth interview which had ended at 5.20 pm on 6 February 1977. A linear abrasion, 1 1/4 inches long was observed in the centre of McCartney's forehead, with two further small abrasions above and below it. Dr Hendron noted that Mr McCartneys right cheek was red and puffy. Dr Henderson had no note of this but on the form used to record the findings on examination he wrote "claimed struck on face no evidence of any bruises". The mark on Mr McCartney's forehead was superficial; it was considered to have been present for a couple of days and was of a type that could be caused by a finger nail. When asked for his conclusions on the evidence, Dr Hendron stated that he had no doubt that Mr McCartney had been assaulted. Mr MacDermott Mr MacDermott had been arrested on 31 January 1977 and his interviews took place in Strand Road Police Station in Derry between the date of his arrest and 2 February. He claimed that he had been beaten before making admissions and had been abused and threatened on his way to the interview room. He also gave evidence that the principal statement of admission had been prepared by a detective officer while he, MacDermott, lay on a bed. It was claimed that his mental resolve had been so eroded by the assaults and threats that by the time the statement was being recorded, he did not care what it contained. Mr MacDermott was examined by a number of doctors, including his own father who was a general medical practitioner. No significant signs of physical injury were found. He was observed to have tenderness of the jaw and ears which, he claimed, had been areas of assault. He also exhibited signs of anxiety tension. Towards the end of the trial, the judge asked counsel for the prosecution about the charges against Donnelly. He said, Am I right in saying that the position is that he was charged and then what happened? The court was informed that no evidence was being offered? Counsel for the prosecution replied, He was never returned for trial. The charges were not proceeded with. In a lengthy judgment the trial judge found that neither Mr McCartney nor Mr MacDermott had been ill treated as they had alleged. Indeed, in relation to Mr McCartney, the judge declared that his certain conclusion [was] that the Crown has satisfied me beyond reasonable doubt that McCartney was not ill treated and in relation to Mr MacDermott that he was absolutely satisfied that he had not been ill treated in any way or threatened. The judge fully accepted the evidence of the police officers denying ill treatment at all times. In relation to Mr Donnelly, the judge said that he was satisfied that the police had not assaulted or ill treated him. Mr Brady was condemned as a dishonest and unreliable witness whose evidence the judge found did not assist in deciding whether Mr McCartney had been ill treated. Dr Hendron had expressed the strong opinion that Mr McCartney, Mr Donnelly and Mr Brady had been assaulted by police officers. MacDermott J said this about the doctors evidence: There is no doubt in my mind that Dr. Hendron believes, I am sure genuinely, that McCartney, Brady, Donnelly and others have been ill treated at Castlereagh, and such a conclusion could be reached by anyone who is prepared to form a conclusion after hearing only what might be described as one side of the case. To my mind, Dr. Hendron's evidence throughout was coloured by this belief and lacked the professional objectivity displayed later by other doctors Robert Barclay On 2 January 1977 Robert Barclay was arrested and taken to Omagh Police Station where he was interviewed over a number of days by Detective Constables French and Newell (the same officers who had interviewed Mr Donnelly approximately one month later). Mr Barclay was said to have made admissions during these interviews. He also complained of ill treatment at the hands of both detective officers. He alleged that they assaulted him by slapping him and punching him and that they had threatened him. On 2 December 1977, after a trial in which he gave evidence that he had been assaulted by the officers, Mr Barclay was convicted on foot of the admissions that he had made during interview. He appealed his convictions. A solicitor had given evidence on his trial that when he saw Mr Barclay in court on 4 January he had a black eye. Two doctors who had examined him while he was at Omagh Police Station found signs of injury. On 12 April 1978, the then Lord Chief Justice of Northern Ireland, Lord Lowry, delivering the judgment of the Court of Appeal, quashed the convictions. Although no written judgment appears to have been given, Lord Lowry was recorded as having said: It is not possible to exclude the conclusion that the injuries found on the accused were inflicted at Omagh Police Station and this renders inadmissible any statement made by him. Subsequently, Mr Barclay brought a private prosecution against Detective Constable French and Detective Constable Newell. In his judgment, which was delivered on 25 April 1979, the trial judge in that case accepted that there was a strong prima facie case that Mr Barclay had been assaulted. He said that Mr Barclay had undoubtedly sustained injuries in Omagh Police Station. He referred, however, to Mr Barclays admission that, on other occasions quite unconnected with the proceedings against the police officers, he had been dishonest. Also, on certain matters relating to his interviews by the detectives (such as, for instance, which of them had taken the notes of the interview) Mr Barclay was found by the judge to have been inaccurate. But the medical evidence that was called on the prosecution of the police officers was found to be consistent with Mr Barclays allegations. The judge said, however, that he could not be certain that the injuries had occurred at the time that Mr Barclay alleged they had been inflicted. The effect of the evidence made it unlikely that they were self inflicted but this was a possibility in the estimation of the judge. Therefore, on the basis that there was a reasonable doubt as to their guilt, he considered that he was left with no alternative but to acquit the officers. Although the private prosecution of Detective Constables French and Newell took place after the trial of Mr McCartney and Mr MacDermott, Mr Barclays appeal against his convictions had succeeded before their trial began. Their trial commenced on 18 September 1978. Of course, no reference to Mr Barclays successful appeal was made during the trial of Mr McCartney and Mr MacDermott. There is no reason to believe that anything was known of that by those involved in their trial. On the contrary, the fact that such a relevant circumstance was not referred to is a clear indication that nothing was known about it. The reasons that the prosecution of John Donnelly did not proceed In a memorandum of 29 June 1977, Mr Roy Junkin, then an assistant director in the Department of the Director of Public Prosecutions, considered the prospects of success for the prosecution of Mr Donnelly. He concluded that a court would not accept that the statement of admission made by Mr Donnelly was voluntary. He therefore recommended that the prosecution should not proceed. That recommendation was accepted by Mr Junkins superior, Mr George McLaughlin, to whom the memorandum had been addressed and a direction of no prosecution was duly issued. Mr Donnelly was interviewed about his complaint of ill treatment after being informed that the prosecution against him was not to proceed. Following the interview, Mr Junkin considered the papers again. In a further memorandum to Mr McLaughlin dated 6 October 1977, Mr Junkin reviewed all the evidence including that obtained from Mr Donnelly during the interview about his complaint. He stated that he had no doubt that Donnelly was assaulted whilst in police custody at Castlereagh. The only detective identified by Mr Donnelly was Detective Constable Newell. He had claimed that this was the only police officer who had disclosed his name. Since this police officer had interviewed Mr Donnelly with Detective Constable French and since Mr Donnelly had said that both Detective Constable Newell and the other officer present had assaulted him, Mr Junkin recommended that both be prosecuted for assault. In his response to Mr Junkins recommendation, Mr McLaughlin, in a memorandum dated 10 March 1978 (6 months before the trial of Mr McCartney and Mr MacDermott began), agreed that there was no doubt that Mr Donnelly had been assaulted while in custody at Castlereagh. But Mr McLaughlin concluded that not all of Mr Donnellys complaints were supported by findings on medical examination. He also considered that because 8 or 9 other police officers had interviewed Mr Donnelly the prosecution would not be able to establish that any particular injury had been inflicted by Detective Constables Newell and French. He therefore declined to accept Mr Junkins recommendation that the officers be prosecuted. The quashing of the appellants convictions On the hearing before the Court of Appeal of the reference by CCRC, Ms McDermott QC, appearing on behalf of Mr McCartney, submitted that if counsel for the prosecution had known the reason that the prosecution of Donnelly had been discontinued, he would not have put to him in cross examination that his injuries were self inflicted. This submission does not appear to have been countered by counsel who appeared for the Crown on the hearing of the reference and it does not feature in the conclusions expressed by the Court of Appeal in its judgment on the reference. At the same hearing, counsel for the appellant Mr MacDermott drew attention to what he suggested was a striking similarity between the manner in which, on Mr Donnellys account, a statement was taken from him by Detective Constable French and the way in which, according to Mr MacDermott, the most important statement of admission had been recorded from him by the same police officer. Generally, it was submitted that if the trial judge had been aware of the reasons that Mr Donnelly had not been prosecuted (viz that an assistant director in the office of the DPP and a senior assistant director considered that he had certainly been assaulted by police officers) he would not have admitted the confession statements. It was suggested that the judge would have formed a more favourable view of the evidence of Mr Donnelly and Mr Brady and would have considered that the police officers credibility was wholly undermined. The Court of Appeal gave its decision on these arguments in the final paragraph of its judgment as follows: We cannot rule out the possibility that the evidence of the police officers may have been discredited by evidence that is now available. The admission in evidence of MacDermott's confessions depended upon the acceptance by the judge of the evidence of DC French. If the judge had known of the finding of a prima facie case in the prosecution brought by Mr Barclay against DC French he may well have reached a different conclusion. To this is to be added the striking similarity between the description given by Donnelly and MacDermott as to the manner in which their admissions were recorded. If the allegations by Donnelly had been supported and strengthened by the new evidence this could have served also to discredit the evidence given by the police officers in McCartney's case. In both cases we are left with a distinct feeling of unease about the safety of their convictions based as they were on admissions and the convictions must therefore be quashed. The challenge to the refusal of compensation On 7 November 2007 a letter in the following terms was sent to Mr McCartneys solicitors in response to the application that they had made on his behalf for compensation under section 133 of the 1988 Act: The Secretary of State has not yet reached a decision about the application; before he does so I would like to give you the opportunity to comment in writing on the views set out below. Under section 133 compensation is payable to an applicant where his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice. Mr McCartneys convictions were, we believe, reversed within the meaning of section 133, by the decision of the Court of Appeal on 15 February 2007. We also tend to the view that this reversal was based on a new or newly discovered fact. However, in light of the available case law on these matters, we believe that your client has so far failed to establish that a new or newly discovered fact has shown beyond reasonable doubt that there has been a miscarriage of justice either on the basis that your client is demonstrably innocent or on the basis of a failure of the trial process. Further representations were made on behalf of Mr McCartney. Rejecting these, a letter dated 16 May 2008 sent on behalf of the Secretary of State, communicated his decision that Mr McCartney was not eligible under section 133. It contained the following passage: The reasons for that decision are those as previously set out in my letter of 7 November. In your further representations you made two main points. Firstly, you suggest that there was a comprehensive failure to disclose material critical to Mr McCartney's defence. The Secretary of State does not consider that anything went wrong with the investigation of the offence or in the conduct of the trial so as to result in a failure of the trial process. Secondly, you suggest that the tape of the appeal should be listened to. It is the written judgment of the CoA that sets out the basis for the decision that a conviction was unsafe and therefore the basis on which the Secretary of State decides if the conditions for statutory compensation are fulfilled. Similar letters were sent to solicitors acting for Mr MacDermott. These solicitors also made further representations and on 17 November 2008 a final responding letter was sent in which the following appeared: We have now considered the other points you put to us on 1 August in relation to the Boyle case [In re Boyles Application [2008] NICA 35]. The majority of the Court of Appeal in that case posed the test of whether the claimant should not have been convicted. We do not believe that the terms of the Court of Appeal's judgment in your client's appeal mean that he should not have been convicted. Therefore, the Boyle case does not alter the Secretary of State's decision that your client is not entitled to compensation. Both appellants sought judicial review of the Secretary of States decision. These applications were dismissed by Weatherup J, although it is clear that he felt that they might have succeeded if he had felt able to apply the test which, he considered, had been propounded by Lord Bingham in R (Mullen) v Secretary of State for the Home Department [2004] UKHL 18, [2005] 1 AC 1. Weatherup J considered that there were two types of new or newly discovered fact (necessary as a prerequisite for eligibility under section 133, as explained by Lord Hope in paras 79 and 81 of his judgment). The first was the evidence that it had been accepted by the assistant director and the senior assistant director in the DPPs office that Mr Donnelly had been assaulted and that this would have tended to throw doubt on the credibility of the police witnesses. The second type was described by the judge in paras 23 and 24 of his judgment: 23another part of the new evidence relating to the prosecution of Donnelly concerned the manner in which his evidence was dealt with at the trial. When Donnelly was called as a defence witness, counsel for the DPP, rather than proceeding on the position of the DPP officials dealing with the prosecution of Donnelly, adopted and put to Donnelly in cross examination the police approach rejected by those officials, namely that Donnelly had received injuries after an attack on police officers and that some injuries were also self inflicted. Further, when the trial judge was considering the evidence of Donnelly, he asked counsel for the DPP about the absence of a prosecution of Donnelly and a complete reply was not furnished. It is important to note that this was a non jury Diplock trial. It is apparent that the tria1 Judge was inviting counsel to disclose, as delicately as the situation demanded, whether there was a reason for the decision not to prosecute that related to matters other than the alleged ill treatment of Donnelly, in respect of which the answer of counsel implied that there was. The trial judge was not told that the DPP had concluded that Donnelly had been ill treated, that his confession was not to be considered as being voluntary and there was no other evidence against him. There is no suggestion that counsel in the applicants trial had been made aware of the DPP position relating to the prosecution of Donnelly. Had counsel for the DPP been aware of the DPPs approach to the prosecution of Donnelly two aspects of the trial would have been different. First of all, the cross examination of Donnelly would have taken a different course and counsel would not have put to Donnelly that his injuries had been occasioned by defensive action by the police and by his own hand. Secondly, the submission of counsel for the DPP in relation to the prosecution of Donnelly would not have rested on the bald assertion that the prosecution was not proceeded with but should have indicated the basis of the DPP decision. 24 Thus the issue of the treatment of the Donnelly evidence is not directly a matter about the credibility of the evidence given by the police officers, nor is it directly a matter about withholding disclosure from the defence. Rather it is a matter about the conduct of the prosecution in relation to the evidence of a witness who was central to the defence challenge to the voluntariness of the admissions on which the applicants were convicted. In light of the above discussion of the Donnelly evidence there is a basis for concluding that something had gone seriously wrong with the conduct of the trial. This is a matter that is capable of satisfying the wider interpretation of miscarriage of justice expounded by Lord Bingham. It is evident from these passages that Weatherup J considered that it would have been quite wrong for prosecuting counsel, had he known of the reasons that Mr Donnelly had not been prosecuted, to pursue the line of questioning that he did. On the hearing of the appeal before this court Mr Maguire QC, who appeared on behalf of the Secretary of State for Northern Ireland, was unable to confirm that Crown counsel was unaware of the reasons that the prosecution of Mr Donnelly was not pursued but I share Weatherup Js view that this is the only possible explanation for his having cross examined Mr Donnelly as he did. Mr Junkin and Mr McLaughlin had concluded that Mr Donnelly had been assaulted by police officers. If that view (which was the product of extensive consideration of all the relevant material) had been communicated to prosecuting counsel, it would have been improper for him to advance a case which was quite at odds with the conclusion that had been reached by two experienced officers in the department of the Director of Public Prosecutions. At a more fundamental level, however, it was not open to the prosecuting authority to adopt a different stance in relation to Mr Donnellys evidence according to the context in which it was being considered or, as Lord Rodger so pertinently put it during argument, to face both ways. The decision not to prosecute Mr Donnelly on a charge of murder and one of causing an explosion when, according to police evidence, he had voluntarily admitted to both was a momentous one. It is unsurprising that Mr Junkin and Mr McLaughlin only felt able to take that course because they were convinced that he had been assaulted by police officers. It is simply incompatible with the prosecutions duty of fairness for a different position to be taken thereafter as to the manner in which Mr Donnellys injuries were caused unless there was fresh evidence that warranted a different view. In this instance there was no such evidence. Weatherup J was therefore perfectly right when he said that something had gone seriously wrong with the conduct of the trial. Crown counsel ought to have been aware of the DPPs position on this and, if he had been, cross examination of Mr Donnelly challenging his account of how he sustained his injuries would not have taken place. Although Weatherup J concluded that the circumstances of the reversal of the appellants convictions were capable of satisfying the test that Lord Bingham had propounded for eligibility for compensation under section 133, he felt bound to follow more recent authority in England and Wales, particularly R (Allen) (formerly Harris) v Secretary of State for Justice [2009] 1 Cr App R 36 which had expressed a clear preference for the test advocated by Lord Steyn in Mullen. The appellants appeal against the decision of Weatherup J was dismissed by the Court of Appeal. That court did not share Weatherup Js view that the circumstances revealed by the judgment which had quashed the appellants convictions were sufficient to satisfy Lord Binghams formulation of the correct test. The conclusions of the court are contained in para 15 of the judgment of the Lord Chief Justice: In the second category of cases it is necessary to demonstrate that something has gone seriously wrong in the conduct of the trial resulting in the conviction of someone who should not have been convicted. In this case the new facts upon which the appellants rely raise issues about the credibility of one police officer and one other witness. It is not possible to come to any conclusion as to whether the new facts would have led to a different outcome in respect of the assessment of either witness. The new evidence was sufficient to give rise to unease about the safety of the conviction but this is a case in which at its height it can only be said that the appellants might not have been convicted. Such a case lies outside either of the categories identified by Lord Bingham. That is also the reasoning of the decision in Boyles Application [2008] NICA 35 by which we are bound. Should the appellants have been acquitted? In re Boyles Application [2008] NICA 35 was an appeal in which the appellant claimed entitlement to compensation under section 133 and the ex gratia scheme which was then still extant. Some years after the appellants conviction a note taken of one of a series of interviews had been shown by electrostatic detection apparatus (ESDA) testing techniques to have been made at a time other than that claimed by police officers. Another version of the note for that single interview existed, contrary to the denials of the interviewing police officers. The differences were not substantial and nothing which was inculpatory of the appellant had been written in to the version of the notes that had been presented to the court and which the police officers claimed was the only note of the interview. Nevertheless, because the police officers had firmly denied that a different version had been prepared and because that had been shown to be incorrect, it was considered that doubt had been thrown on their credibility and the appellants conviction could not be regarded as safe. In dismissing Mr Boyles appeal against the finding that he was not eligible to apply for compensation under section 133, the Court of Appeal said at para 22: it is impossible for the appellant to assert that he should not have been convicted. One can certainly say that the police officers should not have given the evidence that they did. One may even say with confidence that the trial judge is bound to have taken an entirely different view of their credibility from the extremely favourable impression that he appears to have formed. But it is impossible to conclude that the appellant would not have been found guilty (much less that he should have been acquitted) if evidence of the other version of the interview notes had been given. The circumstances in the Boyle case were obviously and markedly different from those that arise in the present appeals of Mr McCartney and Mr MacDermott. The most that could be said in Boyle was that the newly discovered fact (that there was a different version of the notes of a single interview) cast doubt on the credibility of the police officers who asserted to the contrary. By contrast, although the Court of Appeal which quashed Mr McCartneys and Mr MacDermotts convictions expressed itself in a restrained fashion, there is simply no doubt that these appellants ought not to have been convicted. For the reasons that I have given, it was not open to prosecuting counsel to challenge Mr Donnellys account that he had been assaulted by police officers. I am satisfied that he would not have done so if he had been aware of the true circumstances in which the decision not to continue with the prosecution of Mr Donnelly had been taken. Mr Donnellys evidence that he had been assaulted would therefore have been received without challenge. That evidence, if uncontradicted, is bound to have changed the entire course of the trial. It could not have done less than establish the reasonable possibility that Detective Constable French had assaulted Mr Donnelly and that he had recorded a statement purporting to come from him but which was not given at Mr Donnellys dictation. When those inevitable findings were brought to bear on Mr MacDermotts case they could not have done other than create a doubt as to the voluntariness of his admissions. Section 8(2) of the Northern Ireland (Emergency Provisions) Act 1978 was in force at the date of the trial. It provided: If, in any such proceedings [ie criminal proceedings for a scheduled offence] where the prosecution proposes to give in evidence a statement made by the accused, prima facie evidence is adduced that the accused was subjected to torture or to inhuman or degrading treatment in order to induce him to make the statement, the court shall, unless the prosecution satisfies it that the statement was not so obtained (a) exclude the statement, or (b) if the statement has been received in evidence, either (i) continue the trial disregarding the statement; or (ii) direct that the trial shall be restarted before a differently constituted court (before which the statement in question shall be inadmissible). The trial judge had reminded himself of this provision at the beginning of his judgment. He said that the appellants had raised a prima facie case as required by the section and that, in those circumstances, the burden passes to the Crown to satisfy me beyond reasonable doubt that the statement, whose admissibility is challenged, was not obtained by ill treatment. In other words, a prima facie case of ill treatment having been established the burden rests squarely on the Crown of satisfying me (and by that I mean satisfying me beyond reasonable doubt) that the accused was not ill treated. In making these observations the trial judge was reflecting the well known statement of the law in this area provided by Lowry LCJ in R v Hetherington [1975] NI 164, 168 where he said: It is not for the defence to prove but for the prosecution to disprove beyond reasonable doubt in relation to each accused that he was not subject even to any degrading treatment in order to induce him to make a statement on which the Crown rely, the decision under section 6(2) [the precursor of section 8(2) of the 1978 Act] must be based solely on how the statement is proved to have been obtained and not on whether it was true. The prosecution would therefore have had to prove beyond reasonable doubt that the statements made by Mr McCartney and Mr MacDermott had not been obtained by any degrading treatment whatever. It can now be seen that this would have been an impossible task had the full facts and circumstances come to light. A person detained at the same time as Mr McCartney had been assaulted while in Castlereagh Police Office during the same period; the police officers who carried out the assaults on Mr Donnelly were part of the group of officers who were investigating the murders with which Mr McCartney was charged; one of the officers who had assaulted Mr Donnelly had been accused by Mr MacDermott of assaulting him; and the other officer who, according to Mr MacDermott, had assaulted him, had also interviewed Mr McCartney and had been accused of assault by him. Quite apart from these considerations, two further factors of substantial importance must be taken into account. Firstly, by the time that Mr McCartney and Mr MacDermott stood trial, Mr Barclays conviction, based on statements of admission allegedly obtained by Detective Constable French and Detective Constable Newell on interview, had been quashed. If the trial judge had been aware that this conviction had been quashed because the possibility that Mr Barclay had been assaulted by these two officers could not be excluded (which was the necessary implication from the finding of the Court of Appeal) he could not have concluded with the same firmness that he did that Detective Constable French had not engaged in ill treatment of Mr MacDermott. Secondly, once it was established, even as a reasonable possibility, that Mr Donnelly had been assaulted, the judges view of Dr Hendrons evidence could not have remained as he had expressed it in his judgment. Dr Hendron had stated unequivocally that he was convinced that Mr McCartney, Mr Donnelly and Mr Brady had been assaulted. The judge found that this opinion was sincerely held but that Dr Hendrons evidence was coloured by his conviction that the men had been attacked and on that account his testimony lacked professional objectivity. If it had become known that the doctors view about Mr Donnelly was shared by an assistant director and a senior assistant director in the department of the Director of Public Prosecutions, it is not likely that his opinion would have been dismissed in the manner that it was by the trial judge. The combined effect of all these factors makes it inevitable, in my opinion, that, had the judge been fully acquainted with all the material information about the reasons for the decision not to continue the prosecution of Mr Donnelly and the circumstances of the quashing of Mr Barclays convictions, he would not have convicted the appellants. Should the appellants have been prosecuted? Not only should the appellants have been acquitted, in my opinion they should not have been put to their trial. If prosecuting counsel had become aware of the shadow that necessarily fell on Detective Constable Frenchs evidence by the decision not to proceed with the prosecution of Mr Donnelly and by the quashing of Mr Barclays conviction, it is, in my view, inevitable that he could not have proffered this officer as a witness of truth on the issue of whether Mr MacDermott had been ill treated. Moreover, the conclusion of Mr Junkin and Mr McLaughlin that Mr Donnelly had been assaulted cast significant doubt on the evidence of the entire interviewing team. Although Mr McLaughlin considered that there was insufficient evidence to charge Detective Constables French and Newell, he was of the clear view that Mr Donnelly had been physically attacked by some police officers. It was therefore the case that the office of the Director of Public Prosecutions had determined that some officers within the team that conducted interviews of Mr Donnelly, Mr Brady and Mr McCartney had been guilty of assault on Mr Donnelly. Mr Brady alleged that he had been assaulted in much the same manner as Mr Donnelly had been. Despite this, he had not made admissions. He had no personal advantage to gain by fabricating his account of the attacks on him. The trial judge found, however, that he was prepared to do so in order to help a friend (Mr McCartney) and because of his animus towards the police. I cannot believe that the judge would have reached that view if he had known that the DPP had concluded that Mr Donnelly had been assaulted and that Mr Barclays conviction had been quashed because of the reasonable possibility that two members of the same interviewing team had also assaulted him. Likewise, I cannot believe that if experienced Crown counsel had been aware of these matters he would have done other than advise that the prosecution of Mr McCartney and Mr MacDermott should not proceed. That prosecution was only viable if there was a realistic prospect of the Crown establishing beyond reasonable doubt that Mr McCartney and Mr MacDermott had not been ill treated. Any objective assessment of all the circumstances as they are now known was bound to have resulted in the conclusion that there was no such prospect. In reaching this view I intend no criticism whatever of counsel who, for the reasons that I have given, must have been wholly unaware of why it had been decided not to prosecute Mr Donnelly. He must also have been ignorant of the fact that Mr Barclays conviction had been quashed and of the circumstances in which that had occurred. A fortiori, no criticism of the trial judge is warranted. On the contrary, he made what in retrospect was an astute and pertinent inquiry as to why Mr Donnelly had not been prosecuted and was not given the information which, if it had been provided, would certainly have led to a completely different outcome. While it might be said that the assistant director and the senior assistant director in the department of the Director of Public Prosecutions ought to have been alive to the impact that their conclusion about the assaults on Mr Donnelly was bound to have on the propriety of proceeding with the prosecution of Mr McCartney and Mr MacDermott, there is no reason to suppose that they were aware of the quashing of Mr Barclays convictions or of the evidence of Mr Brady. Neither is discussed in the exchange of memoranda between Mr Junkin and Mr McLaughlin. These are matters which have played a significant part in leading me to the conclusion that the prosecution of Mr McCartney and Mr MacDermott ought not to have taken place. In deciding that the appellants ought not to have been convicted and, indeed, ought not to have been required to stand trial, I have gone beyond the findings of the Court of Appeal which quashed their convictions. On one reading, the letter of 16 May 2008 sent on behalf of the Secretary of State suggests that the judgment of the Court of Appeal provides the exclusive basis on which the Secretary of State decides if the conditions for statutory compensation are fulfilled. And much was made in the course of argument of an answer given by Earl Ferrers in the course of the passage through the House of Lords of the Bill which ultimately became the 1988 Act. Earl Ferrers answer was to the effect that the Secretary of State would regard the Court of Appeals view as to whether there had been a miscarriage of justice as binding. In my opinion, the decision as to whether the statutory conditions have been fulfilled is one for the Secretary of State to make and he may not relinquish that decision to the Court of Appeal. True, of course, it is that the material on which the decision is taken will derive in most cases from the judgment of the Court of Appeal. True it also is that it would not be appropriate for the Secretary of State to depart from the reasoning that underlies that judgment unless for good reason it is shown to be erroneous but the Secretary of State must make his own decision based on all relevant information touching on the question whether there has been a miscarriage of justice. In the present appeals, Weatherup J considered that it was open to him to examine the question whether there had been a miscarriage of justice not merely by reference to what the Court of Appeal had said but by taking into account the circumstances revealed by its judgment. At para 20 of his judgment he said: Counsel for the respondent contends that there is nothing in the judgment of the Court of Appeal indicating that the applicants should not have been convicted. It should not be expected that a Court of Appeal will state in terms that an appellant should not have been convicted. The approach of the Court of Appeal on an appeal against conviction is concerned with whether that conviction is unsafe. In taking the cue from the Court of Appeal in determining a successful appellants entitlement to compensation it is necessary to have regard to the circumstances set out in the judgment of the Court of Appeal as well as the wording adopted in the judgment in relation to the position of the appellant. I agree with these observations and they appear, implicitly at least, to have been approved by the Court of Appeal. As Weatherup J stated, the task of the Court of Appeal is not to decide whether the appellant should have been convicted, much less to determine whether the appellant is innocent. It is to decide whether the conviction is safe. The decision whether there has been a miscarriage of justice (whatever meaning is to be given to that phrase) of necessity takes place on a different basis and on foot of consideration of issues beyond those which sound only on whether the conviction is safe. Section 133 As Lord Hope has said, it has been possible until now for courts to avoid a final resolution of the question of what is required in order to establish entitlement to compensation under section 133 of the 1988 Act. Must a person whose conviction has been reversed as the result of a new or newly discovered fact show that he was innocent (Lord Steyns view in Mullen) or can eligibility arise in somewhat wider circumstances (Lord Binghams provisional opinion)? These appeals require this court to confront that debate and to resolve that conflict. For the reasons given by Lord Hope and Lord Clarke, with which I agree, the analysis of Lord Bingham in Mullen as to the possible scope of section 133 is to be preferred to that of Lord Steyn. I cannot accept that the section imposes a requirement to prove innocence. In the first place, not only does such a requirement involve an exercise that is alien to our system of criminal justice, that system of justice does not provide a forum in which assertion of innocence may be advanced. An appeal against conviction heard by the Court of Appeal Criminal Division is statutorily required to focus on the question whether the conviction under challenge is safe. In a number of cases, evidence may emerge which conclusively demonstrates that the appellant was wholly innocent of the crime of which he or she was convicted but that will inevitably be incidental to the primary purpose of the appeal. The Court of Appeal has no function or power to make a pronouncement of innocence. It may observe that the effect of the material considered in the course of the appeal is demonstrative of innocence but it has no statutory function to make a finding to that effect: R v McIlkenny (1991) 93 Cr App R 287. It is therefore not surprising that in New Zealand when the Law Commission proposed that a prerequisite of establishing entitlement to compensation for a wrongful conviction was proof of innocence, it was careful to recommend that a tribunal be set up in which that issue could be frankly addressed and confidently determined: see New Zealand Law Commission Report No 49 (1988) Compensating the Wrongly Convicted paras 124 127 and 136 137. In Canada in 1988 Federal/Provincial Guidelines on Compensation for Wrongly Convicted and Imprisoned Persons likewise required that there be proof of innocence in order to qualify under the ex gratia scheme operated there. In the case of Dumont v Canada (Communication 1467/2006, 21 May 2010) the UN Human Rights Committee held that the failure of the state authorities to establish a procedure for conducting an investigation to examine whether the applicant was innocent and to possibly identify the real perpetrator constituted a breach of article 2(3) of ICCPR read in conjunction with article 14(6). Article 2(3)(a) requires that state authorities provide an effective remedy in the form of access to a procedure in which adequate compensation can be claimed. The respondents in this case rely on the experience in New Zealand and Canada in support of their argument that a miscarriage of justice within the meaning of article 14(6) of the Covenant occurs only when the convicted person is in fact innocent of the offence with which he is charged. The Human Rights Committee in Dumont, while recording the states submission to that effect, reached its decision without adjudicating on it. The New Zealand Law Commissions report does not suggest that article 14(6) must be given that meaning. On the contrary para 71 of the report states that article 14(6) while an important normative statement by the international community and a reference point for domestic compensation schemes was not relied on as a model for the Commissions recommended scheme. There was no unanimity as to the meaning to be given to miscarriage of justice among the delegates who were involved in the negotiations which led to the adoption of ICCPR: see para 9(2) of Lord Binghams speech in Mullen. As he observed, it is possible that the expression commended itself because of the latitude in interpretation which it offered. Or, as the New Zealand Law Commission put it, it is a normative statement which provides a general template for domestic provisions in the subscribing states which can vary as to content. Certainly, while the travaux prparatoires may be regarded as neutral on the meaning of the expression, it is unquestionably clear from these that every proposal that its ambit should be confined to compensating those whose innocence was established was roundly defeated. Against that background, it would be a surprising conclusion that article 14(6) had the very effect that a majority of delegates clearly did not intend. The twin theses on which Lord Steyn relied to support his conclusion that proof of innocence was required in order to establish entitlement to compensation under section 133 have been subject to scrupulous examination in paras 93 and 94 of Lord Hopes judgment. For the reasons that appear there, with which I fully agree, these arguments can no longer be regarded as sound. I also agree with Lord Clarkes reasons for rejecting Lord Steyns formulation of the test. As Lord Clarke has pointed out, if Parliament had intended that a proof of innocence test was to be preferred, that could surely have been easily prescribed. The debate as to whether such a test was appropriate had been extensively referred to in the travaux prparatoires and it is to be presumed that Parliament was aware of this when it came to enact section 133. Confining the application of the section to those who could show that they were innocent was, in any event, a perfectly obvious option. The failure to articulate that test in the legislation can only be explained on the basis that Parliament decided not to choose that option. This conclusion is fortified by the consideration that the expression miscarriage of justice, although its meaning may vary according to context, is a very familiar one in our system of law. In no other context has it been used to connote proof of innocence. I am therefore satisfied that proof of innocence cannot be the criterion on which entitlement to compensation under section 133 is to be determined. Rejection of this hypothesis brings with it the need to determine how miscarriage of justice is to be interpreted. As Lord Hope has said, a fresh analysis is required and for the reasons that he gives the answer is not necessarily provided by the speech of Lord Bingham in Mullen. The use of the word conclusively in article 14(6) of ICCPR and the expression beyond reasonable doubt lends support to the view that the section does not contemplate that all whose convictions have been quashed and who satisfy the other requirements of the section will be entitled to compensation. On this there is no dispute between the parties to these appeals. Lord Hope has proposed that the section should be interpreted as targeting those cases where, as a consequence of the state of affairs revealed by the new or newly discovered fact, it can be concluded that no prosecution ought to have taken place. Lord Clarke prefers to define the category of eligibility as extending to those cases where the new or newly discovered fact leads inexorably to the conclusion that no jury, properly directed, would have convicted. As a matter of practical experience, there may be little difference as to which of these tests should be applied. But it is important that, if possible, clear guidance be given by this court as to the circumstances in which the section should be held to apply. Lord Hope has pointed out that requiring the Secretary of State to apply a test which refers to what a reasonable jury would do is not appropriate since this is a matter best left to the courts. Lord Clarke, on the other hand, suggests that a test which requires the Secretary of State to focus on whether the claimant should never have been prosecuted runs the risk of the inquiry wrongly focusing on the propriety of the decision to prosecute by reference to the circumstances that obtained when the decision was taken. There is substance in both concerns. I believe that a simple test can cater for these concerns and will also faithfully reflect the intention of article 14 (6) and section 133 that only truly deserving applicants should be included in the compensatory scheme. The test which I would have proposed was: whether, on the facts as they now stand revealed, it can be concluded beyond reasonable doubt that the applicant should not have been convicted. Lord Phillips has suggested that the test should be worded in the following way: the new fact shows that a miscarriage of justice has occurred when it so undermines the evidence against the defendant that no conviction could possibly be based upon it. This appears to me to achieve the same result as the test which I would have proposed and I am therefore quite content to subscribe to his formulation. The proper application of either test ties entitlement to compensation firmly to the true factual situation. Procedural deficiencies that led to irregularities in the trial or errors in the investigation of offences will not suffice to establish entitlement to compensation. A claimant for compensation will not need to prove that he was innocent of the crime but he will have to show that, on the basis of the facts as they are now known, he should not have been convicted or that conviction could not possibly be based on those facts. Of course, if innocence can be proved, the test, on either formulation, will be amply satisfied. The adoption of a single, simple test dispenses with the need to consider possible categories of entitlement which, I believe, tends more to confuse than to enlighten. As it happens, although it is possible to construct from Lord Binghams observations a fourth category of case beyond the three that were identified by Toulson LJ in giving permission to appeal in the Adams case, I do not believe that Lord Bingham intended that this be considered a freestanding category. New or newly discovered fact I find myself in complete agreement with the reasoning of Dyson LJ on this issue in the judgment of the Court of Appeal in Adams [2010] QB 460, paras 14 16 and with what Lord Phillips has had to say on the matter in paras 59 63 of his judgment. The newly discovered limb of the requirement clearly, to my mind, connotes discovery by the party who prays it in aid to demonstrate that he should not have been convicted. It would be wholly anomalous, as Dyson LJ has pointed out, that a person whose innocence can be conclusively proved, should be deprived of compensation simply because his lawyers failed to communicate the vital information or failed to grasp its significance. Does denial of compensation infringe the presumption of innocence? Lord Hope has dealt comprehensively with the arguments made by the appellants on this issue in paras 108 to 111 of his judgment. I agree with his reasons for rejecting the arguments. There is nothing further that I could usefully say on the topic. Conclusions I would allow the appeals of Mr McCartney and Mr MacDermott. For the reasons that I have given, I am satisfied that, on the facts as they are now known, they should not have been convicted. As it happens, I am also satisfied that they ought not to have been prosecuted and their cases therefore fulfil the requirement that Lord Hope has formulated. Clearly they also satisfy the test preferred by Lord Clarke of being cases in which no reasonable jury, properly directed, could convict. Like Lord Phillips and Lord Hope I consider that both are entitled to be compensated under section 133. Although I would hold that the material on which Mr Adams relied constituted a newly discovered fact, I do not consider that he has demonstrated that, on the facts as they now stand revealed, it can be concluded beyond reasonable doubt that he should not have been convicted. I would dismiss his appeal. LORD CLARKE Introduction I gratefully adopt Lord Hopes description of the background to the introduction of the statutory right to compensation for miscarriages for justice in section 133 of the Criminal Justice Act 1988 in the light of article 14(6) of the ICCPR. He has set out the relevant provisions of section 133 and article 14(6). I shall not therefore repeat them. The principal issues for decision in this appeal are the meaning of the expressions miscarriage of justice and new or newly discovered fact in those provisions. Miscarriage of justice The meaning of this expression has been considered in a number of cases as described by Lord Hope. I agree with him that it is helpful to consider its meaning in the present context by reference to the categories identified by Toulson LJ when giving permission to appeal to the Court of Appeal in the Adams appeal which are described by Dyson LJ [2010] QB 460, at para 19 of his judgment which is quoted in full by Lord Hope. Dyson LJ described the categories of case thus: A category 1 case is where the court is sure that the defendant is innocent of the crime of which he has been convicted. An obvious example is where DNA evidence, not obtainable at the time of trial, shows beyond doubt that the defendant was not guilty of the offence. A category 2 case is where the fresh evidence shows that he was wrongly convicted in the sense that, had the fresh evidence been available at the trial, no reasonable jury could properly have convicted. An example is where the prosecution case rested entirely on the evidence of a witness who was put forward as a witness of truth and fresh evidence undermines the creditworthiness of that witness, so that no fair minded jury could properly have convicted on the evidence of that witness. It does not follow in a category 2 case that the defendant was innocent. A category 3 case is where the fresh evidence is such that the conviction cannot be regarded as safe, but the court cannot say that no fair minded jury could properly convict if there were to be a trial which included the fresh evidence. The court concludes that a fair minded jury might convict or it might acquit. There is a fourth category of case to which Lord Bingham referred in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1. This is where a conviction is quashed because something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who should not have been convicted. The respondents say that there is only a miscarriage of justice within the meaning of article 14(6) and section 133 in a category 1 case. They say that the provision that the new or newly discovered fact must show conclusively (in article 14(6)) or beyond reasonable doubt (in section 133(1)) that there has been a miscarriage of justice points to the conclusion that it is only where the claimant can prove his innocence that there has been a miscarriage of justice. The appellants say, by contrast, that the words conclusively and beyond reasonable doubt do not inform the meaning of miscarriage of justice but only indicate the standard of proving the miscarriage of justice, once its meaning has been established. They say that if the Court of Appeal allows an appeal in any of the three categories of case there will have been a miscarriage of justice, unless the claimant is convicted at a retrial. Another possibility is, of course, that section 133 applies in a category 1 and a category 2 case, but not to a category 3 case. Category 1 proof of innocence I turn first to the question whether the expression miscarriage of justice is confined to the case where the claimant can prove beyond reasonable doubt that he was innocent. This was of course the view espoused by Lord Steyn in Mullen. Lord Bingham expressed a different view in that case, albeit without reaching a firm conclusion, and Lord Hope has taken a different view in this case. I agree with him. To my mind there is nothing in either the language or the context to limit the meaning of miscarriage of justice to the case where the claimant can prove that he was innocent. If that is so, it is not for the court to limit the meaning because its own view is that it would be desirable to do so as a matter of policy. Such matters of policy are for Parliament and not for the courts. It is common ground that the expression is capable of a broader meaning than that espoused by Lord Steyn. For reasons which I explain below, to my mind the natural meaning is broader, but I will begin with the context because I appreciate that, as has famously been said, context is everything. The context of section 133 is of course article 14(6). Both Lord Steyn and Lord Bingham considered the travaux prparatoires in Mullen. In para 9(2) of his speech Lord Bingham said this: The House was referred to the travaux prparatoires of the negotiations which culminated in adoption of the ICCPR. It is plain that some delegates contended that compensation should not be paid save to those who were shown to be innocent, and such delegates found no difficulty in expressing this very simple principle. But it is equally plain, as Mr Pleming submitted, that every proposal to that effect was voted down. The travaux disclose no consensus of opinion on the meaning to be given to this expression. It may be that the expression commended itself because of the latitude in interpretation which it offered. It is common ground that the expression miscarriage of justice in article 14(6) and therefore section 133(1) should if possible be given an autonomous meaning. Although the travaux are far from conclusive, they do seem to me to point the way because, as Lord Bingham put it, every proposal that innocence should be the test was turned down. So, if the expression is to be given an autonomous meaning, it cannot be limited to cases where innocence can be shown. It follows that I do not agree with Lord Steyns view that the travaux do not assist in any way. On the contrary, they assist on the first question in this appeal, namely whether proof of innocence should be the test. I agree with Lord Steyn (at para 35) that there is no foundation in the language of article 14(6) and section 133, or by reference to any relevant external aids to construction, for the suggestion that Parliament intended to use the words miscarriage of justice in any wider sense than it bears in article 14(6) and that Parliament intended to give effect to the United Kingdoms international obligations in article 14(6) and no more. I would add and no less. Parliament used the same or almost the same language, so that there is to my mind no warrant for holding that it intended to confer narrower rights to compensation than those afforded by article 14(6). As Lord Hope observes at para 91, Lord Steyn correctly said at para 45 that both article 14(6) and section 133 show that there was no overarching purpose of compensating all who are wrongly convicted. This is demonstrated by the fact that compensation only arises at all in the case of appeals out of time and by the indispensable pre condition that a new or newly discovered fact shows conclusively (or beyond reasonable doubt) that there has been a miscarriage of justice. So, for example, in the case of a recognition that an earlier dismissal of an appeal was wrong, the case falls outside article 14(6). That is so, however palpable the error in the first appellate decision may have been, and however severe the punishment that the victim suffered unjustly. As Lord Steyn put it, those considerations demonstrate that the fundamental right under article 14(6) was unquestionably narrowly circumscribed. Para 46 is the only paragraph in which Lord Steyn focuses on the relevant language. In it, as Lord Hope explains at paras 91 and 92, Lord Steyn focused on the language of article 14(6) and section 133, and in particular on the use of conclusively and beyond reasonable doubt respectively. He said that that language filters out cases where it is only established that there may have been a wrongful conviction and cases where it is only probable that there has been a wrongful conviction. He observed that those two categories would include the vast majority of cases where an appeal is allowed out of time. He concluded that those considerations militated against an expansive interpretation of miscarriage of justice and ultimately held that: While accepting that in other contexts a miscarriage of justice is capable of bearing a narrower or wider meaning, the only relevant context points to a narrow interpretation, viz, the case where innocence is demonstrated. I accept that the language points to a narrow construction but not that it is restricted to the case where innocence is demonstrated. Indeed, to my mind Lord Steyn did not point to any reason why the right to compensation should be so confined. There is nothing in the language or the context to lead to the conclusion that cases in category 2 should be excluded. Yet the expression miscarriage of justice naturally includes such a case. Indeed it seems to me to be the paradigm case. A criminal trial is concerned (and concerned only) with the question whether the prosecution has proved beyond reasonable doubt to the satisfaction of the jury that the defendant is guilty of the offence charged. If the new or newly discovered fact shows that, in the light of it, no reasonable jury, properly directed, could have convicted the accused, to my mind his conviction would, in ordinary language, be a miscarriage of justice. I see no reason why such a case should not be a miscarriage of justice within the meaning of article 14(6) or section 133(1). None of Lord Steyns reasoning leads to the conclusion that it is not. He himself did not address this possibility. In paras 91 to 95 Lord Hope has given his reasons for disagreeing with Lord Steyn that innocence must be proved. I agree with them. I would very briefly summarise my own reasons (in addition to those already given) in this way. (a) (b) If Parliament had intended to limit miscarriages of justice to cases where the claimant could prove innocence, it would have been easy to say so. As Lord Bingham put it in Mullen at para 9(2) quoted above, those delegates who wished to limit compensation in that way found no difficulty in expressing this very simple principle. In para 9(1) Lord Bingham noted that when what was to become section 133 was debated in the House of Lords, the minister, Earl Ferrers, was pressed by Lord Hutchinson QC to say whether a miscarriage of justice connoted the innocence of a defendant or the raising of a doubt about his guilt, but the minister said nothing to suggest that compensation would be payable only to the innocent: Hansard (HL Debates), 22 July 1988, cols 1631 1634. (c) Lord Steyns reliance upon the words une erreur judiciaire in the French text of article 14(6) was unsound for the reasons given by Lord Hope at para 93. (d) The five reasons given by Lord Bingham in para 9(4) of Mullen for thinking that reliance upon para 25 of the explanatory report prepared by a committee of experts on human rights with reference to article 3 of the Seventh Protocol was not of the persuasive value which Lord Steyn identified are convincing: see Lord Hope at para 94. (e) Little assistance is to be gained from either the jurisprudence of the United Nations Human Rights Committee or academic opinion. (f) Courts of appeal are not called upon to decide whether defendants are innocent: see Lord Bingham at para 9(6) and Lord Hope at para 95. If, as I believe is the case, Lord Steyns test is too narrow, the question arises what is the correct construction of the expression miscarriage of justice in this context. I will consider the possibilities in turn. Category 2 no reasonable jury properly directed could convict Category 2 would of course include category 1, but not vice versa. Mr Owen QC submitted that cases in this category would involve a miscarriage of justice, although he also sought to include category 3, to which I will return. I have already expressed my view that there is nothing in the language or context of article 14(6) or section 133 to exclude category 2 and that the expression naturally includes it. Absent any clear indication in the language or context, it is to my mind permissible to have regard to the approach to it within the United Kingdom. In 1988 the Court of Appeal in England and Wales determined criminal appeals by reference to the unamended section 2(1) of the Criminal Appeal Act 1968. The proviso to that subsection provided that, notwithstanding that the Court of Appeal were of the opinion that the point raised in the appeal might be decided in favour of the appellant, they may dismiss the appeal if they consider that no miscarriage of justice has actually occurred. In R v Secretary of State for the Home Department, Ex p Bateman (1994) 7 Admin LR 175 the Court of Appeal (Sir Thomas Bingham MR, Farquharson and Simon Brown LJJ) dismissed an appeal from an order of the Divisional Court refusing judicial review of a decision refusing the appellant compensation under section 133. He had been convicted of several counts of receiving stolen goods and sentenced to six years imprisonment. He had appealed to the Court of Appeal on the ground that he had been convicted on the basis of evidence in statement form given by witnesses from New Zealand. His appeal failed. Some time later his case was referred back to the Court of Appeal under section 17 of the Criminal Appeal Act 1968. This time his appeal succeeded on what was essentially the same ground as that which had failed before and his convictions were quashed. In the Court of Appeal he argued inter alia that the second Court of Appeal must have regarded his conviction as a miscarriage of justice because they would otherwise have applied the proviso. Sir Thomas Bingham (with whom the other members of the court agreed) said this: Therefore, it follows, he says, that he is a victim of a miscarriage of justice and from that it follows that he is entitled to compensation. To deny him compensation is, he argues, to undermine his acquittal and the presumption of innocence which flows from the fact that his convictions have been quashed. I am, for my part, unable to accept that argument, although I hasten to assure Mr Bateman that in doing so I have no intention whatever to undermine the effect of the quashing of his convictions. He is entitled to be treated, for all purposes, as if he had never been convicted. Nor do I wish to suggest that Mr Bateman is not the victim of what the man in the street would regard as a miscarriage of justice. He has been imprisoned for three and a half years when he should not have been convicted or imprisoned at all on the second decision of the Court of Appeal (Criminal Division). The man in the street would regard that as a miscarriage of justice and so would I. But that is not, in my judgment, the question. The question is whether the miscarriage of justice from which Mr Bateman has suffered is one that has the characteristics which the Act lays down as a pre condition of the statutory right to demand compensation. That, therefore, is the question to which I now turn. The Master of the Rolls then held that there was no new or newly discovered fact, so that Mr Bateman could not satisfy the relevant criteria under section 133. The relevance of the statement quoted above is that it supports the conclusion that the Master of the Rolls accepted that there had been a miscarriage of justice within the meaning of section 133, which in turn supports the conclusion that that expression is not limited to cases in which the claimant can prove his innocence. It is perhaps the forerunner of Lord Binghams approach in Mullen. A similar conclusion can be drawn from the terms of section 106, of the Criminal Procedure (Scotland) Act 1995, which sets out the test for criminal appeals in Scotland. By subsection (3) it provides: By an appeal under subsection (1) above a person may bring under review of the High Court any alleged miscarriage of justice, which may include such a miscarriage based on (a) subject to subsections 3A to 3D below, the existence and significance of evidence which was not heard at the original proceedings; and (b) the jurys having returned a verdict which no reasonable jury, properly directed, could have returned. It can thus be seen that a miscarriage of justice for the purposes of a fresh evidence appeal in Scotland includes the case where the jurys verdict is one which no reasonable jury, properly directed, could have returned. That is of course a category 2 case. Section 106(3) is thus an example of the expression miscarriage of justice being used in a very similar context to that with which we are concerned. It has been suggested that to include category 2 within the test of miscarriage of justice in section 133 would cause difficulties of application. For my part, I would not accept that suggestion. It is a test used at the end of the prosecution case in countless criminal trials in England and Wales. Moreover, it is used in the Court of Appeal in England and Wales. While it is not the question for decision in an English appeal because the question is now simply whether the conviction is safe, it is plainly relevant when a retrial is sought. The Court of Appeal would not make an order for a retrial if it formed the view that the effect of the new or newly discovered evidence led to the conclusion that no reasonable jury, properly directed, could convict. Moreover, so far as I am aware, this test has caused no difficulty in criminal appeals in Scotland. It is a test which is familiar to the criminal trial and appeal process, which the proposed test of innocence is not. As Lord Hope has observed at para 95, in R (Allen) (formerly Harris) v Secretary of State for Justice [2009] 2 All ER 1 at para 40(iii) Hughes LJ said that cases where the innocence of the convicted defendant is genuinely demonstrated beyond reasonable doubt by the new or newly discovered fact the Court of Appeal will, in virtually every case, make that plain. However, that may not be the case and, as Lord Hope says, the Court of Appeal is not bound to say whether or not a defendant is innocent. In this regard there is authority for the proposition that the Court of Appeal is neither obliged nor entitled to say whether an appellant is innocent: see R v McIlkenny (1991) 93 Cr App R 287 at 310 311. Whether that is correct or not, I agree with Lord Hope that, to put it no higher, it is at least questionable whether it can be right to restrict the entitlement to compensation to cases where the establishment of innocence is apparent from the Court of Appeals judgment. It is of interest in the context of this debate to note that it is common ground that it was only after the decision in Mullen that Secretaries of State have applied an innocence test and that they do not do so in Scotland even now. It was suggested in argument that it is not appropriate for the Secretary of State, and not a court, to make judgments of this kind. However, section 133(3) expressly provides that the question whether there is a right to compensation shall be determined by the Secretary of State. Nobody has suggested that it is not appropriate for the Secretary of State to decide whether the claimant has proved that the new or newly discovered fact shows that he is innocent. It does not seem to me to be any less appropriate for the Secretary of State to decide whether he has proved that it shows that no reasonable jury could have convicted him. In reaching his or her conclusion the Secretary of State is of course bound to have regard to what the Court of Appeal which reverses the conviction has said. In In re McFarland [2004] UKHL 17, [2004] 1 WLR 1289 Lord Bingham said at para 16, albeit in the context of a claim under the ex gratia scheme, that the Secretary of State must properly be guided by the judgment of the Court of Appeal. However, it seems to me that it is for the Secretary of State to have regard to all relevant material when deciding whether the claimant has established beyond reasonable doubt that, in the light of the new or newly discovered fact, no reasonable jury, properly directed, could have convicted him. I see no reason why the Secretary of State could not decide that question, whether on the grounds of innocence or otherwise. As I see it, the matter has to be tested as at the date of the reversal, having regard both to the evidence that was available at the trial and to the new or newly discovered facts. I would include in the evidence available at the trial, all such evidence, not just that adduced on behalf of the prosecution, but also that adduced during the defence case. I would therefore include admissions made by the defendant in cross examination in a case in which the new evidence showed that the case should have been stopped. The question is whether, on that material, he had a case to answer or, put another way, whether a reasonable jury properly directed could have convicted him. If he proves beyond reasonable doubt that the answer to those questions is no, he is in my opinion entitled to compensation under section 133 on the basis that there has been a miscarriage of justice. I entirely accept that the cases in which compensation can be claimed are limited by the necessity to satisfy the criteria in the section and by the need to show beyond reasonable doubt that the new or newly discovered fact demonstrates, in the light of the other material before the court that no reasonable jury, properly directed, could have convicted him. The Secretary of State would of course have to be satisfied that the alleged fact was indeed a fact. I should add by way of postscript that, as I see it, category 2 potentially includes a case where the new or newly discovered fact is such that, if it had been known at the trial, the trial judge would have stopped the trial on the ground of abuse of process. If the Court of Appeal concluded that a new trial could not properly be ordered on the basis that it was not possible to cure the abuse, so that no reasonable jury, properly directed, could convict, there would, in my opinion have been a miscarriage of justice within section 133. It seems to me that this must be within the kind of miscarriage of justice which Lord Bingham had in mind in Mullen, namely where a conviction is quashed because something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who certainly should not have been convicted. Since Mullen, some doubt has been expressed as to whether the basis upon which it was decided is correct. See, for example, R (Siddall) v Secretary of State for Justice [2009] EWHC 482 (Admin) per Leveson LJ at paras 47 48. The basis on which it was decided by the majority, comprising Lord Bingham, Lord Scott, Lord Rodger and Lord Walker was that Mr Mullens conviction had been reversed by the Court of Appeal on the ground that there had been an abuse of executive power and not any failure in the trial process: see per Lord Bingham at para 8, Lord Scott at para 65, Lord Rodger at para 69 and Lord Walker at para 70. In particular, Lord Bingham said that it was for failures in the trial process that the Secretary of State is bound by article 14(6) and section 133 to pay compensation. He distinguished those from abuse of executive power. He did so by reference to R v Horseferry Road Magistrates Court, Ex p Bennett [1994] 1 AC 42 per Lord Griffiths at pp 61 62 and R v Looseley [2001] 1 WLR 2060 at para 40. Lord Scott said that the Court of Appeal had not reversed the conviction because there had been any failure in the trial process but because, prior to the commencement of the trial process, there had been serious abuse of executive power which had led to the removal of the claimant from Zimbabwe to this country and thus enabled the trial to take place. Although Leveson LJ observed that this distinction has its difficulties and noted that Lord Steyn said at para 57 that, if that abuse had been disclosed the trial would have been stopped, and in its written submissions Justice suggested that Mullen might now be decided differently on its facts. There is I think scope for argument in the future as to whether there is a class of cases in which the section would not apply, of which Mullen is an example. They are cases in which it has been held that the trial should not be permitted to proceed, not because of anything related to the case against the defendant, but because to permit it would offend against the rule of law or would seriously affect the integrity of the administration of justice. In quashing Mullens conviction Rose LJ, giving the judgment of the Court of Appeal, said at [2000] QB 520, 535 536: This court recognises the immense degree of public revulsion which has, quite properly, attached to the activities of those who have assisted and furthered the violent operations of the IRA and other terrorist organisations. In the discretionary exercise, great weight must therefore be attached to the nature of the offence involved in this case. Against that, however, the conduct of the security services and police in procuring the unlawful deportation of the defendant in the manner which has been described represents, in the view of this court, a blatant and extremely serious failure to adhere to the rule of law with regard to the production of a defendant for prosecution in the English courts. The need to discourage such conduct on the part of those who are responsible for criminal prosecutions is a matter of public policy to which, as appears from R v Horseferry Road Magistrates' Court, Ex p Bennett [1994] 1 AC 42 and R v Latif [1996] 1 WLR 104, very considerable weight must be attached. It appears to me to be at least arguable that such a case would not fall within section 133. None of the cases before the Court in these appeals is such a case. I recognise that Lord Phillips rejects category 2 as a test and that he has suggested an alternative test. However, section 133 inevitably requires the Secretary of State to consider the effect of the new or newly discovered fact upon the other evidence before the court and thus on the validity of the conviction. This involves the evaluation of the evidence in its legal context. It also expressly requires the Secretary of State to decide whether in the light of all the evidence the claimant has shown beyond reasonable doubt that there has been a miscarriage of justice. In considering all these questions, the Secretary of State can of course always take such advice as is appropriate. I remain of the view that category 2 is an appropriate formulation of the test and that the position is or should be as stated above. Compensation is only payable where, in the light of the new or newly discovered fact, no reasonable jury, properly directed, could have convicted or, subject perhaps to the point made in para 215 above, where the new or newly discovered fact would have led the judge to stop the case on the ground of abuse in the trial process. However, I recognise that Lord Phillips suggests replacing the category 2 test with a more robust test. It is that a new fact will show that a miscarriage of justice has occurred when it so undermines the evidence against the defendant that no conviction could possibly be based upon it. I have assumed that the second it means the evidence against the defendant. To my mind that test is consistent with the category 2 test identified above because, in such a case, no reasonable jury properly directed, could convict the defendant. For that reason and on that basis, I would accept the proposed test, with which Lord Hope, Baroness Hale and Lord Kerr agree. Category 3 unsafe conviction Section 2(1) of the Criminal Appeal Act 1968, as substituted by section 2(1) of the Criminal Appeal Act 1995, provides that the Court of Appeal shall allow an appeal if they think the conviction is unsafe. The proviso in the previous section 2(1) was repealed. Mr Owen submitted that where a qualifying appeal is allowed on the basis that the claimant has shown beyond reasonable doubt that the conviction was unsafe because of a new or newly discovered fact, it follows that there was a miscarriage of justice within the meaning of section 133. It is certainly possible to construe the expression miscarriage of justice as wide enough to include such a case. I do not however think that Parliament can have intended the expression to have such a wide meaning in section 133(1) because it would have been easy for the section to have been drafted in such a way as to include every case where the relevant appeal was allowed on the basis of a new or newly discovered fact. Moreover none of the courts which have considered section 133 have suggested that it might have such a wide meaning: see the cases referred to by Lord Hope at para 82. In particular, the formulation of the test by Lord Bingham in Mullen does not encompass every case where the conviction was held to be unsafe on the basis of new evidence. His formulation was that there is a miscarriage of justice where a conviction is quashed because something has gone seriously wrong in the investigation of the offence or the conduct of the trial, resulting in the conviction of someone who certainly should not have been convicted. It is not possible to say that, merely because a conviction has been quashed because it was unsafe, the appellant should not have been convicted. A conviction may be unsafe because the Court of Appeal concludes that, but for the successful ground of appeal, the jury might not have convicted. Indeed, this is by far the most common case in which an appeal is allowed. It is a category 3 case in which, as Dyson LJ put it in the passage quoted above, a fair minded jury might convict or might acquit. In such a case I do not think that one can say as a matter of course that the defendant should not have been convicted. It seems to me that it is only in a category 2 case (which of course includes a category 1 case) that it can be said that a person should not have been convicted. It can be so held in such a case because it follows from the conclusion that no reasonable jury, properly directed, could have convicted the defendant that he should not have been convicted. Any lesser test is to my mind too uncertain and would not satisfy the statutory test that, in order to be entitled to compensation, the claimant must prove beyond reasonable doubt that there has been a miscarriage of justice. If he might have been convicted by a jury on all the evidence including the new or newly discovered fact, he cannot show for sure that there has been a miscarriage of justice within section 133(1). Retrial Section 133(5A) was not part of section 133 when Mullen was decided. It makes it clear that, where the claimant succeeds on appeal but is convicted at a retrial, he is not entitled to compensation because his conviction has not been reversed. If his appeal succeeds and the Court of Appeal orders a retrial, but the prosecution decides not to proceed with the retrial, the conviction is treated a reversed when it so indicates. In these circumstances, the position is as described above. If a retrial takes place and the claimant is acquitted of all offences at a retrial, there is scope for debate as to the position. By subsection (5A) the conviction is treated as reversed when he is so acquitted. It is not necessary to decide this question in this appeal but it is my provisional view that the same approach as described above would apply. Thus, in order to be entitled to compensation, he would have to prove beyond reasonable doubt that on the basis of the new or newly discovered fact no reasonable jury would have convicted him. New or newly discovered fact The question is what is meant by a new or newly discovered fact. In particular the question is what is meant by a newly discovered fact. Mr Tam QC submitted that a fact which was known to the prosecution and knowable to the defence because it was available to them, but which they did not know because they did not take the steps they should have taken to examine the evidence was not a newly discovered fact. I would not accept that submission. If the fact was not in fact discovered at or before the trial or at an in time appeal but was discovered thereafter, it follows that it was a newly discovered fact. The question is whether it was discovered earlier, not whether it was discoverable earlier. In my opinion the fact that it was discovered by the prosecution before the appeal is irrelevant. In neither of the appeals before the Supreme Court were the relevant facts discovered by the defendants or their lawyers at or before the trial or the in time appeal. It follows that they were newly discovered facts. The fact that in the Adams case they were discoverable by the defendants lawyers is irrelevant. As I see it, therefore, on the facts of these appeals this part of the test is satisfied. However, there was much debate as to whether it is possible for a fact to be a newly discovered fact if it was known to the defendants lawyers. In my opinion it is. Section 133(1) is subject to the proviso unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted. The proviso does not apply if the non disclosure of the fact was attributable to his lawyers. It could have done so. As Dyson LJ explained at paras 14 16 of his judgment, there is no mention of the convicted persons legal advisers in article 14(6) or section 133, whereas article 14(3) does refer to legal advisers. Moreover, there is no suggestion that the person convicted in section 133(1) includes his lawyers. In my opinion the Court of Appeal correctly held that knowledge of the fact by the defendants lawyers would not prevent it being a newly discovered fact. I note in this regard that in a case where the fact was known to the defendants lawyers and not used at the trial, the failure to use it would be very relevant to the question whether the evidence of the fact would be admissible under section 23 of the Criminal Appeal Act 1968. It might well be held that in the light of the fact that the lawyers failed to deploy it, it was not necessary or expedient in the interests of justice to admit it on an appeal. In that event the appeal would not be allowed or the conviction reversed on the basis of it. The remaining question is whether it is possible for a fact to be a newly discovered fact if it was known to the defendant himself at trial or at an in time appeal. The Court of Appeal held that it was, for the reasons given by Dyson LJ at paras 14 to 18. I agree. Section 133(1) contains the proviso unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted. This proviso would not be necessary if the question whether evidence was new or newly discovered were tested by reference to the knowledge of the convicted person himself. The proviso seems to me to assume that a fact may be newly discovered even though it is known to the defendant at the relevant time. Otherwise it would have very little effect because it would only apply where the defendant did not know the fact but its non disclosure was attributable to him. Such a situation is perhaps theoretically possible but the natural meaning of the proviso is that it covers the case where the defendant is aware of the fact at the relevant time but does not deploy it either personally or through his lawyers. So understood, the proviso seems to me to point to the conclusion that a fact may be a newly discovered fact even if it was known to the defendant himself at trial or at an in time appeal. For these reasons I agree with Lord Hopes conclusion at para 107 and Lord Phillips conclusion at para 62 that the relevant knowledge is that of the trial court, but do not agree with Lord Hopes conclusion, also at para 107, that material disclosed to the defence by the time of the trial cannot be said to have been newly discovered when it is taken into account at the stage of the out of time appeal. For the reasons given earlier, it is my view that material that was not discovered either by the defendant or his lawyers but was discovered only after the in time appeal was newly discovered on the simple basis that, whether or not it ought to have been discovered, it was not in fact discovered. That was the position in both the Adams appeal and the Northern Irish appeals. Article 6(2) of the European Convention of Human Rights Other members of the Court have considered the issues under this head in some detail. The European Court of Human Rights (ECtHR) has applied article 6(2) in cases which are not covered by its language. For my part, I do not think that this is a case in which it is necessary or would be appropriate to analyse that jurisprudence in detail. I will only say that I am not at present persuaded that article 14(6) and section 133 are a form of lex specialis to which article 6(2) can never be relevant. For present purposes I shall simply assume that it is in principle possible for article 6(2) to apply to proceedings under section 133. I can see that it is inappropriate, to put it no higher, to impute criminal liability to a person who has been acquitted. In each of the cases in which a claim for compensation arises under section 133(1) the claimants conviction has been reversed by the Court of Appeal in an out of time appeal. Section 2(3) of the Criminal Appeal Act 1968 (as substituted in 1995) provides: (3) An order of the Court of Appeal quashing a conviction shall, except when under section 7 below the appellant is ordered to be retried, operate as a direction to the court of trial to enter, instead of the record of conviction, a judgment and verdict of acquittal. Thus the effect of the reversal of the conviction by the order of the Court of Appeal quashing it, is that the person concerned is formally acquitted. In these circumstances the court hearing and determining a claim for compensation under section 133(1) must not say or do anything inconsistent with the claimants acquittal. If the analysis set out above is adopted, there is no risk of its doing so. The question in each case is whether the claimant has proved beyond reasonable doubt that the new or newly discovered fact has demonstrated that there was a miscarriage of justice on the basis that no reasonable jury, properly directed, could convict him. The trial of that question does not in any way affect or impugn the acquittal of the claimant as provided by section 2(3) of the Criminal Appeal Act 1968 quoted above. The question at such a trial is different and so is the burden of proof. The position is not unlike a civil process where a claimant seeks damages from a defendant who has been acquitted of, say, causing grievous bodily harm to A at a criminal trial. Under English law it is permissible for A to seek damages from the defendant on the ground that he was unlawfully injured by him, alleging all the same facts as had been relied upon at the criminal trial. The critical difference between the two processes is that at the criminal trial the prosecution has to prove guilt beyond reasonable doubt, whereas at the civil trial A only has to prove liability on the balance of probabilities. The ECtHR has expressly recognised that civil proceedings of that kind do not infringe article 6(2) of the Convention: see eg Y v Norway (2003) 41 EHRR 87, where the court expressly said at para 41 that, while the acquittal from criminal liability ought to be maintained in compensation proceedings, it should not preclude the establishment of civil liability to pay compensation arising out of the same facts on the basis of a less strict burden of proof. It did add in para 42 that, if the national decision on compensation contains a statement imputing the criminal liability of the respondent party, this could raise an issue falling within the ambit of article 6(2) of the Convention. See also Bok v The Netherlands, (Application No 45482/06), 18 January 2011. Similarly, here, where, at any rate on the analysis set out above, there is no question of anything said or done in the section 133 proceedings impugning the acquittal in the criminal proceedings, I see nothing in article 6(2) which is in any way inconsistent with the conclusions I have reached. Disposal I agree with Lord Phillips, Lord Hope, Baroness Hale and Lord Kerr that the appeal in the Adams case must be dismissed. Lord Phillips has set out the relevant facts. As Dyson LJ observed at para 59, the Court of Appeal allowed the appeal because the undeployed material was important and might have led the jury to acquit. The decision to quash the conviction was founded on the potential that the undeployed material had for affecting the jurys verdict. It was thus a category 3 case and, for the reasons given earlier, section 133(1) does not cover such a case. I also agree that the appeals in the Northern Irish cases should be allowed. Lord Kerr has set out the facts in some detail. They show, at any rate to my mind, that, in the light of the newly discovered facts, no reasonable jury, properly directed, could have convicted them. DISSENTING JUDGMENTS LORD JUDGE The legislation Section 133(1) of the Criminal Justice Act 1988 (section 133) provides: when a person has been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice, the Secretary of State shall pay compensation for the miscarriage of justice to the person who has suffered punishment as a result of such conviction or, if he is dead, to his personal representatives, unless the non disclosure of the unknown fact was wholly or partly attributable to the person convicted. Reversed refers to a conviction which is quashed on an appeal out of time or following a reference by the Criminal Cases Review Commission (section 133(5)). By section 133(2) compensation is not payable unless the application for compensation has been made: Before the end of the period of 2 years beginning with the date on which the convictionis reversed or he is pardoned. This limitation was inserted by sections 61(1) (3) and (9) of the Criminal Justice and Immigration Act 2008 and came into force on 1 December 2008. Simultaneously, in accordance with section 61(1), (2), (5) and (9) of the 2008 Act, provision was made for the cases where the conviction is quashed on an appeal out of time, and a retrial ordered, so that: The conviction is not to be treatedas reversed unless and until the person is acquitted of all offences at the retrial or the prosecution indicates that it has decided not to proceed with the retrial. (Section 133(5A)) The determination whether there is an entitlement to compensation is vested exclusively in the Secretary of State, (section 133(3)) who in exceptional circumstances may extend the time for making an application. (section 133(2A)) When section 133 was enacted an ex gratia system operated in tandem with it. In England and Wales and Northern Ireland, but not in Scotland, the ex gratia scheme was abolished in 2006. In his article Compensation for Wrongful Imprisonment [2010] Crim LR 805, Professor John Spencer QC convincingly criticised the narrowness of and consequent anomalies which arise from the limitations of the statutory scheme. No alternative remedy is provided unless, perhaps, and subject to limitation periods, where malpractice in the investigative process is established, the victim may pursue a remedy in tort, or when the individual suffered a wrongful conviction as a consequence of negligence by his legal advisors, a claim in damages may be available. In short, the statutory scheme does not preclude any relevant action which may, in theory, be available in tort, but it is in any event unsupported by the ex gratia scheme. Nevertheless we must analyse section 133 and the ambit of the scheme for the payment of compensation without reference to its anomalies and disadvantages. When it was examined by the House of Lords in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1 the meaning and effect of section 133 produced contradictory opinions with no authoritative decision. Lord Steyn concluded that the statutory scheme was confined to cases where the person concerned was clearly innocent. Lord Bingham of Cornhill, while agreeing with the result, for carefully explained reasons, hesitated to accept this restriction on the ambit of the statutory scheme. The differences between their respective approaches to the problem have been considered and examined in a number of subsequent decisions, of which the most recent is R (Allen (formerly Harris) v Secretary of State for Justice [2009] 1 Cr App R 36. They must finally be resolved now. As we are not agreed, without embarking on what would be a repetitious discourse of much of the voluminous material drawn to our attention, I shall briefly explain the reasons why I agree with Lord Steyn. In Mullen the parties were agreed that the interpretation of section 133 required what was described as a correct understanding of article 14(6) of the International Covenant on Civil and Political Rights, dated 16 December 1966. (ICCPR) That view was adopted by the House of Lords and it is unchallenged in the present proceedings. Article 14(6) provides: When a person has by a final decision been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the grounds that a new or newly discovered fact shows conclusively that there has been a miscarriage of justice, the person who has suffered punishment as a result of such conviction shall be compensated according to law, unless it is proved that the non disclosure of the unknown fact in time is wholly or partly attributable to him. In short, the enactment of section 133 in virtually identical terms represented the response of the United Kingdom to a Treaty obligation. One further Treaty provision needs immediate attention. In November 1984 article 3 of Protocol 7 to the Convention of Human Rights also made what was effectively an identical provision to article 14(6) of the ICCPR. When a person has by a final decision been convicted of a criminal offence and when subsequently his conviction has been reversed, or he has been pardoned, on the ground that a new or newly discovered fact shows conclusively that there has been a miscarriage of justice, the person who has suffered punishment as a result of such conviction shall be compensated according to the law or the practice of the State concerned, unless it is proved that the non disclosure of the unknown fact in time is wholly or partly attributable to him. Article 3, Protocol 7 will become relevant when the jurisprudence of the European Court of Human Rights falls to be considered. In the context of a statutory provision reflecting the international obligations undertaken by the United Kingdom, it would be productive of confusion for the phrase miscarriage of justice to be analysed by reference to the many different ways in which, looking at our own statutes which enable convictions to be quashed, and the language used, sometimes loosely, in the course of numerous judgments bearing on these questions. The phrase reflects an autonomous concept, in which the words miscarriage of justice reflect the international obligations of the United Kingdom under article 14(6). Like article 14(6), section 133 distinguishes the reversal of the conviction (or a pardon) and a miscarriage of justice. Within the section itself, as with article 14(6), these concepts are distinct. Even if the remaining pre conditions to the payment of compensation are established, the reversal of the conviction is an essential prerequisite to but is not conclusive of the entitlement to compensation. In short, for the purposes of section 133 the reversal of the conviction and the consequent revival of the legal presumption of innocence is not synonymous with a miscarriage of justice. Therefore before compensation is payable under the statutory scheme more than the reversal of the conviction is required. The requirement is that a miscarriage of justice must be demonstrated beyond reasonable doubt. In my view the use of this phrase was deliberate and significant. The phrase is not relevant to the evidential question whether the conviction has been reversed and it is not directed to any individual feature or aspect of the investigation or trial processes. If the reversal of the conviction alone were sufficient, that fact would be proved beyond reasonable doubt by the court record, and if any specific feature of the investigation or trial processes were relevant, appropriate provision could readily have been made in section 133 itself. Instead the phrase describes the characteristics or attributes of the miscarriage of justice which must be established. The word conclusively in article 14(6) was not repeated. Rather the familiar description of the standard of proof in criminal cases and, significantly in the context of a claim for the payment of compensation (normally a civil claim), the standard normally applied to the prosecution in the criminal justice process was imposed on the defendant. For this purpose the balance of probabilities was expressly ignored. Accordingly, for section 133 to apply, following a conviction of an offence which was proved beyond reasonable doubt, the emergence of a new or newly discovered fact should demonstrate not only that the conviction was unsafe, or that the investigative or trial processes were defective, but that justice had surely miscarried. In the present context, the ultimate and sure miscarriage of justice is the conviction and incarceration of the truly innocent. This leads me to the conclusion that as a matter of construction the operation of the compensation scheme under section 133 is confined to miscarriages of justice in which the defendant was convicted of an offence of which he was truly innocent. In my judgment nothing less will do, and no alternative or half way house or compromise solution consistent with this clear statutory provision is available. I must therefore address some of the contentions which suggest that this construction is over restrictive. The unsafe conviction Mr Tim Owen QC highlighted the absence of word innocent from section 133. The omission reflects not only the autonomous concept of miscarriage of justice, but more significantly, the absence of an innocent verdict in the criminal justice process. The defendant is either proved to be guilty of the crime alleged, or he is entitled to a not guilty verdict and acquittal. A verdict of innocent is unknown. On acquittal, or the reversal of a conviction, the presumption of innocence revives. It applies when the jury considers that there is a high probability that the defendant is guilty, and indeed to cases like Mullen, whose conviction was quashed notwithstanding the assessment of the court that he was undoubtedly guilty. Just because it is a concept to which the criminal justice process is not directed, the word innocent could have no place in section 133. The only ground for quashing a conviction in the Court of Appeal Criminal Division (the Court) is that it is unsafe. There are however occasions when a new or newly discovered fact may well demonstrate the factual innocence of the appellant. And if it does, the judgment of the court may say so. I respectfully disagree with the observation in R v McIlkenny (1991) 93 Cr App R 287 that the court is not entitled to state that an appellant is innocent. The processes of the Court of Appeal do not allow for a formal declaration of factual innocence, any more than the trial process recognises a verdict of innocent. However there can surely be no stronger case for doubting the safety of a conviction than evidence which unmistakenably demonstrates that the appellant is in truth an innocent man or woman. (See R v Fergus (1994) 98 Cr App R 313: R v Hodgson [2009] EWCA Crim 490.) Although the conviction is quashed not on the ground that the defendant is innocent, but because his conviction is unsafe, the terms of the judgment should conscientiously reflect the true reasons for its decision that the conviction should indeed be quashed as unsafe. At the risk of stating the obvious, the decision whether to quash a conviction is for the Court: so are all features of the trial process, and indeed any order for retrial. If the end of the judicial process is that the conviction is quashed, or if following a retrial, the defendant is acquitted, the administrative decision whether compensation is payable for a miscarriage of justice is vested exclusively in the Secretary of State. The determination is not limited to some kind of administrative assessment of the circumstances in which the judicial process has come to an end. Therefore while the Secretary of State should pay the closest possible attention to the terms of the judgment of the Court, whatever the terms in which the judgment is expressed, when making the decision whether a miscarriage of justice has occurred, he is not confined to the judgment of the Court. Retrial The circumstances in which a retrial will be ordered following the quashing of a conviction vary enormously. The single question is whether in a fact specific context the interests of justice should lead to such an order. Dealing with it generally it is most unusual for an order for retrial to be made many years after conviction, or when the sentence imposed at the original trial has been or is close to being completed. On the other hand, again dealing with it generally, where a conviction is recent, and the sentence substantial, and the evidence relied on the prosecution is likely to be available at the retrial, then a retrial may well be ordered. Exceptions can be found both ways. At the risk of repetition, the decision is fact specific. It can however be confidently stated that it would be inconceivable for the Crown to seek or the Court to order a new trial if it were made clear in the terms of the judgment that the conviction was being quashed on the basis that the fresh evidence demonstrated that the defendant was innocent. This reinforces my view that if that conclusion is justified, the court is entitled to say so in its judgment. These considerations bring me to section 133(5A). This subsection addresses the newly introduced statutory time limit in which an application for compensation may be made in the context of an order for retrial. If for any reason (including the conclusion of the Court that the defendant is truly innocent) no order for retrial is made, time runs from the date when the conviction is quashed. If however (again, for whatever reason) the order quashing the conviction is accompanied by an order for retrial, notwithstanding the presumption of innocence, for the purposes of the scheme for the payment of compensation the conviction is not reversed or quashed and the time for making an application is accordingly postponed until the retrial process is completed. This enables first, the defendant to concentrate his attention on the forthcoming retrial. Second, it is conclusive of the question (adversely to the defendant) if he is convicted, when his position is exactly the same as it would have been if the original conviction had not been quashed. Third, if he is acquitted, the process may provide the Secretary of State with further material on which to base his determination. In my judgment section 133(5A) has no bearing on the proper construction of the words beyond reasonable doubt that there has been a miscarriage of justice, and the entitlement to compensation under the statutory scheme was not expanded with effect from 1 December 2008 when section 133(5A) came into force. That was not the purpose of this new inserted provision which was directed to the consequences of the introduction of the new timetable within which applications should be made. It was procedural only. European Court of Human Rights In my judgment the jurisprudence of the European Court of Human Rights drawn to our attention by Mr Owen does not bear on the issues which arise in this litigation. As already indicated once a conviction has been reversed the presumption of innocence applies. Subject only to the provisions of sections 76 83 of the Criminal Justice Act 2003 the rule against double jeopardy applies and the defendant cannot be prosecuted a second time for an offence of which he has been acquitted, or when his conviction has been reversed and for the purposes of the administration of criminal justice the prosecution process is at an end. Nevertheless the acquittal, or the successful appeal against conviction, does not operate as an absolute bar to litigation. It remains open to any individual to assert that notwithstanding the acquittal or quashing of the conviction, the defendant was guilty. That is what Lord Steyn said about Mullen in his judgment in that case. A defendant who has been acquitted of rape may face proceedings for damages by the complainant and she may successfully establish on the balance of probabilities that he did indeed rape her and is liable in damages. In proceedings for defamation on the basis that the defendants innocence is questioned, the acquittal does not create an irrebuttable presumption that the assertion cannot be justified and must be unjustifiable. Article 3, Protocol 7 forms part of the Convention. It must be read together with the Convention. The jurisprudence of the European Court of Human Rights relied on by Mr Owen was not directed to and did not address the provisions of article 3, Protocol 7. If the decisions he relied on apply in the present case it will in effect mean that the reversal of the conviction carries with it an obligation to pay compensation in accordance with section 133, although such a conclusion would be inconsistent with the wording of article 3, Protocol 7 itself. Bok v The Netherlands (Application No 45482/06) (unreported) 18 January 2011 confirms that it does not. Section 133 therefore provides an individual whose conviction has been reversed with the opportunity (but no obligation) to make a claim for compensation based on a statutory test which is effectively identical to the provisions of the European Convention. The Secretary of State must allow or reject the application in accordance with that test. Conviction Impossible This heading is used to encompass some of the alternative ways of approaching the concept of miscarriage of justice adopted in the majority judgments which have reached the conclusion that the phrase has a rather broader ambit than I do. A newly discovered fact which demonstrates that the prosecution against the defendant is shredded to the extent that no conviction could have been based on it, or that no evidence would properly have been offered or, if there had been a trial, there would have been no case to answer at the close of the prosecution case, is likely to provide powerful material which may lead the Secretary of State to conclude that the defendant is indeed innocent. However that conclusion does not automatically follow, and unless it does, section 133 does not apply. In short, these considerations are of evidential significance, maybe of crucial evidential significance, but not determinative. There are a variety of different circumstances in which the Court may make a decision on appeal in relation to decisions at trial that what appeared to be powerful evidence for the Crown should have been excluded. For example, in the light of some newly discovered fact the Court may conclude that the decision of the trial judge to allow crucial prosecution eye witnesses to give their evidence anonymously was wrong, or no longer tenable: without that evidence there would be no case against the defendant. The Court may order a retrial, but without the protection of an anonymity order, the crucial witnesses may then refuse to give evidence at all. Accordingly no further evidence would be offered against the defendant. In my judgment it should not, and it would not, follow that the defendant would be entitled to compensation. Similar considerations would arise if, on the basis of fresh evidence, the Court concluded that the judge had wrongly admitted crucial hearsay evidence without which there would have been no prosecution. Taking the matter further, R v Smith [1999] 2 Cr App R 238 illustrates the difficulty of equating the no case to answer situation with the concept of miscarriage of justice within section 133. The judge rejected a submission that there was no case to answer. The Court concluded that he was wrong and went on to examine the question, what if a submission is wrongly rejected but the defendant is cross examined into admitting his guilt? It concluded that the conviction would still be unsafe because the defendant was entitled to be acquitted at the close of the prosecution case. It would be surprising if notwithstanding his own sworn admission of guilt, the discovery of a new fact which demonstrated that the decision that there was a case to answer was wrong, should be followed by the payment of compensation. Again, where fresh evidence is advanced on behalf of the appellant which undermines the safety of the conviction, and indeed puts into question a substantial part of the prosecutions case, the prosecution may seek to adduce fresh evidence demonstrative of guilt. The jurisdiction to permit the Crown to do so is available (for example, see R v Hanratty [2002] EWCA Crim 1141; [2002] 3 All ER 534). In the interests of justice the Court may order a new trial to enable all the issues to be resolved by a jury notwithstanding that, standing on its own, the original evidence advanced by the Crown was no longer sufficient to found a case for the appellant to answer. Finally, I must return to Mullen itself, which at [1999] 2 Cr App R 143 sets out the reasons why the conviction was quashed. The matters which constituted the abuse of process occurred before Mullen was returned from Zimbabwe to this jurisdiction. The British authorities procured his deportation by unlawful means, in breach of public international law. The prosecution itself was held to be unlawful. Mullen therefore should not have been charged, let alone prosecuted to trial. Yet the House of Lords was agreed that he was not entitled to compensation, and I wholeheartedly agree. Considerations like these underline some of the practical difficulties with any approach to the construction of section 133 which goes beyond the limits suggested by Lord Steyn in his judgment in Mullen, that compensation within the statutory scheme is payable only when the defendant was convicted of an offence of which he was truly innocent, and therefore beyond reasonable doubt the victim of a miscarriage of justice. In my judgment the principle is that section 133 is concerned with the fact rather than the presumption of innocence in the context of the administrative decision to be made by the Secretary of State. It is not related to different (and if so which?) aspects of the trial processes, or the likely or possible impact which the new or newly discovered fact would have had on the decision to prosecute or on the forensic processes which culminated in conviction. Their practical effect is demonstrated in the case of MacDermott and McCartney. The confessions on which the prosecution relied would have been inadmissible if they had been made not as a result of violence, but rather of inducements. Assuming for present purposes that the newly discovered material demonstrated that Donnelly had been offered identical inducements to those which MacDermott and McCartney had asserted at their trials, their convictions would have been no less liable to be quashed than they were in the light of the fresh evidence relating to police violence. As there was no evidence beyond their inadmissible confession there would have been no basis for any prosecution. And there would, if they were prosecuted, have been no case for either to answer. Yet, in the context of an inducement or inducements, there might, if the confessions were sufficiently detailed, be no reason to doubt that the confessions were true, even if inadmissible. In my judgment their cases would not qualify for compensation. We are here dealing not with inducements which cast doubt on the voluntariliness of the confessions, but with violence. The newly discovered material would have borne on the decision of the trial judge whether the defendants confessions were voluntary or not. The fresh evidence led the Court of Appeal in Northern Ireland to conclude that if it had been available at trial there was a realistic possibility that the evidence of the police officers (who asserted that there had been no intimidation of the defendants, and no grounds for doubting that the confession statements were voluntary) may have been discredited. If so the statements would have been excluded from consideration, and there would then have been no prosecution and no case for either of them to answer. In principle, however, the impact on the admissibility of their confessions would have been the same, whether they responded to inducements to confess or succumbed to violence. Although I share the distinct unease of the Court of Appeal in Northern Ireland about the circumstances in which the confessions were made by the appellants, it does not follow that the Secretary of State was obliged to conclude that they were innocent for the purposes and within the ambit of section 133. New or newly discovered fact In the discussion about the meaning of new or newly discovered fact the rival contentions went too far. It would be unrealistic, and removed from the realities of the conduct of the defence at trial that his legal advisers should inform the defendant personally of each and every fact and matter to which their attention is drawn by the prosecution. When all is said and done, the defence advocate is not a mouthpiece or echo chamber for his client. The responsibility for giving advice and assisting the defendant to make whatever decisions which he must make for himself is one aspect of the responsibilities: the deployment of evidence and argument on his behalf is another. Sometimes the lines overlap, but often they do not. It therefore follows that merely because the defendant himself is personally ignorant of a particular fact, it is not new or newly discovered when the defendant personally ceases to be ignorant of it. On the other hand, when the prosecution has complied with all its obligations in relation to disclosure of material to the defence lawyers, and they, for whatever reason, do not then deploy material which appears to be adverse to the prosecution or which would assist the defendant, that material should not automatically be excluded from the ambit of the section on the basis of prosecutorial compliance with its disclosure obligations. Rather the approach should coincide with the circumstances in which fresh evidence is sought to be deployed before the Court in accordance with section 23 of the Criminal Appeal Act 1968. This normally predicates that there should be a reasonable explanation for the earlier failure to adduce the evidence at the trial. In the present case, it is clear from the judgment of the Court in Adams that the conviction was quashed on the basis of fresh evidence in circumstances in which, notwithstanding that the prosecution had fully performed its responsibilities in relation to disclosure, Adamss legal team had failed adequately to respond and fulfil theirs. In my judgment that failure or omission was a new or newly discovered fact within the ambit of section 133. Conclusion In my judgment the appeal of Adams should be dismissed: as to the appeals of MacDermott and McCartney, I should have agreed with Lord Browns proposal that they should be remitted to the Secretary of State for further consideration. LORD BROWN (with whom Lord Rodger agrees) I have had the advantage of reading in draft the judgment of Lord Judge, the Lord Chief Justice, and, agreeing with it as I do, I shall try not to repeat the bulk of its reasoning. So troubled am I, however, that apparently ours is the minority view on these appeals that I wish to add some additional thoughts of my own. That section 133 of the Criminal Justice Act 1988 was intended to give effect to the United Kingdoms international obligation under article 14(6) of the International Covenant on Civil and Political Rights 1966 is, of course, plain and obvious. Section 133(1) omits the phrase in article 14(6) by a final decision reflecting it instead in the definition of reversal in section 133(5) by referring there to an appeal out of time or on a reference and substitutes for the word conclusively in article 14(6) the hallowed expression beyond reasonable doubt. Otherwise the language of the two provisions is virtually identical. It is clear, therefore, that the right to compensation arises only when each of four conditions is satisfied: (i) the conviction is quashed on an appeal out of time or a reference (not, therefore, when a timeous appeal succeeds, nor, of course, on an acquittal at trial); (ii) the appeal succeeds on the ground of a new or newly discovered fact; (iii) the appellant was in no way responsible for the previous non disclosure of that fact; and (iv) that fact shows beyond reasonable doubt that there has been a miscarriage of justice. The critical question for decision here, of course, is what precisely is meant in this context by a miscarriage of justice. As to this, whilst recognising that the expression has an autonomous meaning, I share the view expressed in several of the judgments that there is no real assistance to be derived here from any of the extrinsic material, for example, the travaux or other states practices. Rather, as Lord Bingham suggested in R (Mullen) v Secretary of State for the Home Department [2005] 1 AC 1, 27, para 9(2): It may be that the expression [miscarriage of justice] commended itself because of the latitude in interpretation which it offered. That being so, it was perfectly open to the UK to introduce legislation intended to compensate only those shown to be clearly innocent of the crime of which they had been convicted and in this connection I see no reason to ignore the explanatory report relating to article 3 of Protocol 7 to the European Convention on Human Rights (an article almost precisely reproducing the language of article 14(6)) which, at para 25, states: The intention is that states would be obliged to compensate persons only in clear cases of miscarriage of justice, in the sense that there would be acknowledgment that the person concerned was clearly innocent. True, the UK never ratified Protocol 7 and I am far from suggesting that the explanatory report shows plainly that section 133(1) is to be construed in the way para 25 suggests. But it does surely show that this is both a permissible view to take of the extent of the article 14(6) obligation undertaken by the UK and a perfectly possible construction of section 133(1) itself. Before turning more particularly to whether it is the right construction, it is I think worth pointing out too that the provision whereby those benefiting from article 14(6) are entitled to be compensated according to law similarly accords to individual states a wide discretion as to how such compensation is to be assessed. As to this the UKs approach seems to me notably generous. In reaching his assessment, the Secretary of States assessor is directed to apply principles analogous to those governing the assessment of damages for civil wrongs including, therefore, claims for wrongful imprisonment although a deduction may be made on account of the claimants criminal record. An illustration of the size of the awards liable to be made in these cases is provided by R (OBrien) v Independent Assessor [2007] UKHL 10; [2007] 2 AC 312 concerning compensation claims arising out of the wrongful conviction of the Hickey brothers and others for the murder of Carl Bridgewater at Yew Tree Farm. The first instance decision in that case [2003] EWHC 855 (Admin) shows net final compensation assessments there of 990,000 for Michael Hickey and 506,220 for Vincent Hickey (wrongfully detained in prison respectively for just under thirteen years and something under fourteen years see para 8 of Lord Binghams judgment in the House of Lords). What, then, is the correct interpretation of a miscarriage of justice in section 133(1)? More particularly, is it: (i) the conviction of an innocent defendant, or (ii) the conviction of a defendant who, by a new fact, so undermines the evidence against him as to show that, on the undermined evidence, he could not possibly have been convicted essentially Lord Phillips (category 2) formulation (at para 55), apparently now subscribed to by the majority of the court. I mention only those two possible constructions since no member of the court appears to favour any yet wider construction of section 133 so as to embrace also cases where the fresh evidence renders the conviction unsafe in that, had it been available at the time of the trial, a reasonable jury might or might not have convicted the defendant (Lord Phillips category 3 at para 9). Strikingly, and to my mind significantly, it was this wider construction that not just the appellants but also Mr Alex Bailin QC for the Intervener, JUSTICE, were urging upon the court; indeed, both Mr Owen QC for Mr Adams and Mr Bailin expressly submitted that there was no logical or principled dividing line between categories 2 and 3. And to my mind they were right to do so. Of course, innocence as such (factual as opposed to presumptive) is not a concept known to the criminal law. But nor too, in the context of criminal appeals, is the notion of a prosecution case so undermined that no jury could possibly convict. The criminal court deals only in the safety of convictions. On a fresh evidence appeal the sole question the court asks itself is whether the conviction is unsafe (essentially the lurking doubt test). If the case is a difficult one it sometimes finds it helpful to test its view by asking whether the evidence, if given at the trial, might reasonably have affected the decision of the trial jury to convict R v Pendleton [2001] UKHL 66; [2002] 1 WLR 72, 83, para 19. The ultimate and only question, however, is for the court: is the verdict unsafe? The question raised by section 133, by contrast, is not one for the criminal court but rather one entirely for the Secretary of State. Similarly, no member of the court appears to suggest that Mullen itself was wrongly decided. Lord Steyn, of course, reached his decision there (to allow the Secretary of States appeal and reinstate the decision of the Divisional Court) on the ground that section 133 compensates only those who are clearly innocent whereas Lord Bingham reached his on the altogether narrower ground that: It is for failures of the trial process that the Secretary of State is bound . to pay compensation (para 8). Mr Mullens conviction was, of course, quashed not because of anything that had gone wrong in the trial process but because he would not have been on trial at all but for having been unlawfully returned to this country. Certainly Lord Bingham disagreed with Lord Steyns approach. But it cannot be pretended that Lord Binghams own approach supports the particular formulation suggested by the majority in the present case. My own reasoning in the Divisional Court in Mullen [2002] 1 WLR 1857, 1864 was essentially that later to be adopted by Lord Steyn: 25 What was shown beyond reasonable doubt here was that there had been an abuse of process in bringing the claimant to trial. That was the newly discovered fact. But that fact did not itself show beyond reasonable doubt that there had been a miscarriage of justice. All that it showed was that the court needed to conduct a discretionary exercise to decide in effect which of two important public interests should prevail: the public interest in trying, convicting and punishing the guilty or that in discouraging breaches of the rule of law and preserving the integrity of the criminal justice system. It preferred the latter. True, it had no doubt that the balance came down decisively in the defendants favour. But that was by no means to find that he was innocent, still less that he was plainly so. Rather it was a judgment that the lawful administration of justice would be affronted by his remaining convicted and imprisoned. 26 In short, a miscarriage of justice in the context of section 133 means, in my judgment, the wrongful conviction of an innocent accused. Compensation goes only to those ultimately proved innocent, not to all those whose convictions are adjudged unsafe. The quashing of the claimants conviction in this case was a vindication of the rule of law, not the righting of a mistaken verdict. As I shall come to suggest, the quashing of the conviction in many cases which would fall within the majoritys formulation for compensation here is more properly to be characterised as a vindication of the rule of law than as the righting of a mistaken verdict. Par excellence, indeed, this seems to me to be so in cases where confession statements, even though perhaps demonstrably true (by referring, say, to facts known only to the perpetrator of the crime) are excluded because of intimidation or inducement see particularly in this regard paras 264 and 265 of Lord Judges judgment. My reasons for remaining precisely of the view I expressed in the Divisional Court in Mullen are essentially a combination of the considerations in favour of the category 1 test (that of innocence) and the considerations weighing against the category 2 test (that of critical evidence undermined). As for the factors favouring the test of innocence, it is difficult to improve upon those listed by Lord Phillips at paras 43 48 of his judgment. As Lord Phillips there points out, this construction gives section 133 a perfectly natural and logical meaning, indeed it is the meaning that the man in the street would be likely to accord to the wording of section 133 (para 43); it makes perfect sense of the requirement that the new facts should prove this beyond reasonable doubt (para 44); and it gives section 133 a meaning which is eminently practicable (para 45). It seems to me unnecessary to decide whether Lloyd LJ was right to say in R v McIlkenny (1991) 93 Cr App R 287, 311 that the Court of Appeal is not entitled to state that an appellant is innocent a point on which Lord Phillips (at para 45) and Lord Judge (at para 251) disagree. The all important consideration in this respect is, as Lord Phillips says, that it is for the Secretary of State, not the Court of Appeal, to decide whether there has in fact been a miscarriage of justice (and, therefore, on the innocence test, whether the fresh evidence shows beyond reasonable doubt that the defendant was innocent) and the reasons given for quashing the conviction are unlikely to leave any doubt of this (para 46). As, moreover, Lord Phillips observes (at para 47) the innocence test will ensure that a guilty defendant is not compensated for the consequences of his conviction. If I may revert to the man in the street, he would, I think, be appalled at a construction which, on the contrary, would not infrequently result in the compensation of the guilty, sometimes, as already indicated, to the extent of hundreds of thousands of pounds. As for the factors weighing against the category 2 test, prominent amongst these is undoubtedly the converse of the point just made, the fact that it would result in very substantial compensation for many defendants who are in truth guilty. I have already instanced (para 275 above and paras 264 and 265 of Lord Judges judgment) those whose confession statements (even if true) come to be undermined. Equally this is so in cases where it comes to be seen that anonymous or hearsay evidence should not have been allowed (see particularly in this regard para 260 of Lord Judges judgment). This point, indeed, can be illustrated by the facts of R v Secretary of State for the Home Department, Ex p Bateman (1994) 7 Admin LR 175 (where, as Lord Clarke notes at para 199, I was sitting in the Court of Appeal with Sir Thomas Bingham MR and Farquharson LJ). Mr Batemans appeal for compensation failed in the event because the success of his second criminal appeal owed nothing to a new or newly discovered fact. Obiter, however, the Master of the Rolls suggested that he had suffered a miscarriage of justice. On an appeal out of time his conviction had been quashed because certain statements had been wrongly admitted in evidence at trial. These were statements from important New Zealand witnesses whom he had wanted called and cross examined. But why, I am now inclined to ask, should a successful appellant be compensated in those circumstances? The case against him might well have become more, rather than less, damning had the witnesses indeed been called and given their evidence orally (as was held should have happened). One other case I want to mention which to my mind strikingly illustrates the dangers of adopting the category 2 construction is a recent decision of this court. The case concerned the conviction of each of two brothers (A and B) for murder and two robberies following, as later investigations and a reference by the Criminal Cases Review Commission were to show, police misconduct of the gravest kind (most notably by colluding with the main prosecution witness). On a second appeal some twelve years after conviction there was accordingly no dispute but that As and Bs convictions had to be quashed. The only issue for the Court of Appeal had been whether A should be retried, this time not on the basis of the irredeemably tainted evidence given at his original trial but rather based on a series of admissions of guilt he had made following his conviction and the failure of his first appeal. Because the decision upheld by the majority in this court was to order a retrial, the reporting of the detailed judgments both of the Court of Appeal and of this court has had to be delayed. As, however, these judgments make plain, although B could not be retried (he having made no confession of guilt), the guilt of both was in reality plain. True, the most critical evidence in the case against them had been that of a supergrass (without whose evidence, indeed, it was agreed that there could have been no prosecution at all), upon whose evidence the Crown could no longer rely because of the polices misconduct in conferring upon him a whole host of benefits to secure his continuing cooperation in the brothers prosecution at trial. But his evidence had been supported by a jigsaw of other pieces of evidence. That said, however, in the language of the majoritys category 2 test, no conviction could possibly be based upon it. Is it then to be said that B must be compensated for the twelve years or so he spent in prison before being released at his second appeal? And, indeed, that A too would have had to be compensated had the Court of Appeal not decided to order his retrial? Will the Court of Appeal in future, when deciding at the conclusion of an out of time appeal whether the interests of justice require a retrial, have to factor in the consideration that, unless a retrial is ordered, the successful appellant will or may be found entitled to compensation under the majoritys approach to section 133? The other centrally important consideration militating against a category 2 construction of section 133 is the difficulty indeed, to my mind, impossibility of reconciling this with the language of the section as a whole, and most especially with its requirement that the new facts establish a miscarriage of justice beyond reasonable doubt. It seems to me nonsensical to suggest that the category 2 test is one that can sensibly be satisfied (or not) beyond reasonable doubt. For good measure although, I accept, less conclusively the alternative basis of entitlement to compensation provided for by the section, namely a pardon, naturally connotes innocence rather than some less exacting test. Even the language of a new or newly discovered fact (rather than fresh evidence) to my mind tends to suggest the revelation of something clear and certain namely innocence, rather than merely the undermining of the prosecutions overall case. I entirely accept, of course, that a new fact which does so undermine this case as to show that the appellant could not properly have been convicted on the evidence in fact adduced against him may well in many cases suggest actual innocence and duly persuade the Secretary of State of this. Lord Judge expressly recognises this at para 259 of his judgment. But what if, say, as a result of inadmissible intercept evidence or other reliable intelligence the Secretary of State reasonably believes (perhaps, indeed, is convinced) that the appellant is in fact guilty. Must he nevertheless compensate him? I would hope and respectfully maintain not. Naturally I recognise that the application of the innocence test will exclude from compensation a few who are in fact innocent. Even on the majoritys test, of course, some who are innocent will be excluded. That, however, seems to me preferable to compensating a considerable number (although mercifully not so many as would be compensated on the category 3 approach) who are guilty. After all, this whole compensation scheme operates by creating only a narrow and exceptional class who qualify. The claimant qualifies only by producing a new or newly discovered fact. And only if his conviction is quashed on a reference or an appeal out of time. (It will, indeed, often be a matter of chance whether an appeal is out of time the lawyers may simply have missed the time limit.) Why should the state not have a scheme which compensates only the comparatively few who plainly can demonstrate their innocence and, as I have shown, compensate them generously rather than a larger number who may or may not be innocent? That, at all events, is the scheme which in my opinion Parliament enacted here. On certain of the questions raised there is nothing I wish to add to what Lord Judge has said. I agree with him (at para 252) about the material to be considered by the Secretary of State (indeed, as to this, I agree too with what Lord Phillips says at para 36 of his judgment, subject only to applying the correct test). I agree with all that Lord Judge says (at para 254) as to the relevance here of section 133(5A). I agree with him too (at paras 255 and 256) about the relevance of the Strasbourg jurisprudence in this context. (It hardly needs pointing out that, were the Strasbourg cases to present a problem, they would do so no less for the majority than for the minority view.) And I agree with Lord Judges approach (at paras 266 and 267) to a new or newly discovered fact. In common, as I understand it, with every other member of the Court, I too would dismiss Mr Adamss appeal. Had Lord Judges and my view as to the meaning of section 133 prevailed, I would have been inclined to remit Mr MacDermotts and Mr McCartneys compensation claims to the Secretary of State for his further consideration in the light of our judgments and more particularly of Lord Kerrs masterly analysis of the facts of those two cases. LORD WALKER I agree with the judgments of Lord Judge and Lord Brown.

Section 133 of the Criminal Justice Act 1988 (s 133) provides that the Secretary of State for Justice shall pay compensation when a person has been convicted of a criminal offence and when subsequently his conviction has been reversed or he has been pardoned on the ground that a new or newly discovered fact shows beyond reasonable doubt that there has been a miscarriage of justice. It was enacted to give effect to Article 14(6) of the International Covenant on Civil and Political Rights 1966 (Article 14(6)), which the United Kingdom ratified in May 1976. Article 14(6) also refers to a miscarriage of justice. The principal issue in these appeals was the meaning of this phrase in this context; in particular whether compensation should only be given if someone was subsequently shown conclusively to have been innocent of the offence. The three appellants each claimed compensation following the quashing of their convictions for murder by the Court of Appeal. In each case the claim was refused on the ground that the appellant had not shown that a miscarriage of justice had occurred. In Mr Adams case, it was also refused on the ground that he had not shown that his conviction had been reversed by reason of a new or newly discovered fact. Mr Adams was convicted on 18 May 1993 of the murder of Jack Royal. His conviction was referred to the Court of Appeal in 2007 on the ground that incompetent defence representation had deprived him of a fair trial. His representatives had failed to consider unused material provided by the police which would have assisted in undermining the evidence given by the sole prosecution witness. The Court of Appeal found that if this had been done the jury might not have been satisfied of Mr Adams guilt, although he would not inevitably have been acquitted. Mr McCartney was convicted of the murders of Geoffrey Agate and DC Liam McNulty, and Mr MacDermott that of DC McNulty, on 12 January 1979. The sole evidence was their admissions during interviews with the police. They alleged that these had been made after ill treatment and called other witnesses who claimed to have suffered similar treatment from the same group of police officers. The judge rejected their evidence. He had been told that a prosecution brought against one of these witnesses had not been proceeded with. But he was not told that this was because senior officers in the Department of the Director of Public Prosecutions considered that he had been assaulted by police officers to obtain his confession and that a conviction in another case, based on a confession obtained in similar circumstances and involving one of the same officers, had been quashed. The Court of Appeal in Northern Ireland quashed the convictions of Mr McCartney and Mr MacDermott on 15 February 2007 on the ground that this new evidence left it with a distinct feeling of unease about the safety of their convictions. The Supreme Court unanimously dismisses the appeal of Mr Adams and by a majority (Lord Rodger, Lord Walker, Lord Brown and Lord Judge dissenting) allows the appeals of Mr MacDermott and Mr McCartney. The majority hold that a miscarriage of justice has occurred for the purposes of s 133 when a new or newly discovered fact shows conclusively that the evidence against a defendant has been so undermined that no conviction could possibly be based upon it. Miscarriage of justice Miscarriage of justice was a phrase capable of a number of different meanings. It was useful to consider four categories of cases in which the Court of Appeal would quash a conviction on the basis of fresh evidence: Where it showed a defendant was innocent of the crime (category 1) Where it was such that, had it been available at the time of the trial, no reasonable jury could properly have convicted the defendant (category 2) Where it rendered the conviction unsafe in that, had it been available at the trial, a reasonable jury might or might not have convicted the defendant (category 3) Where something had gone seriously wrong in the investigation of the offence or the conduct of the trial resulting in the conviction of someone who should not have been convicted (category 4) [9] The primary object of s133, and of Article 14(6), was clearly to compensate a person who had been convicted and punished for a crime which he did not commit. A subsidiary objective was not to compensate someone who had in fact committed the crime [37]. Category 4 fell outside this purpose as it dealt with abuses of process so shocking that the conviction should be quashed even if it did not put in doubt the guilt of the convicted person [38]. Category 3 was also outside s 133 because the miscarriage of justice had to be shown beyond reasonable doubt. Category 3 would include a significant number who had in fact committed the offences, as an inevitable consequence of a system which required guilt to be proved beyond reasonable doubt [42]. Category 1 cases were clearly covered by s 133. However, the majority (Lord Phillips, Lord Hope, Lady Hale, Lord Kerr and Lord Clarke) held that the ambit of s 133 was not restricted to category 1 as it would deprive of compensation some defendants who were in fact innocent but could not establish this beyond reasonable doubt. A wider scope was plainly intended at the time of the drafting of Article 14(6). Even though it would not guarantee that all those entitled to compensation were in fact innocent, the test for miscarriage of justice in s 133 (in more robust terms than category 2) was as follows: A new or newly discovered fact will show conclusively that a miscarriage of justice has occurred when it so undermines the evidence against the defendant that no conviction could possibly be based upon it [55]. A miscarriage of justice in a case of that kind would be as great as it would have been if he had in fact been innocent, because in neither case would he have been prosecuted at all [102]. Four justices dissented on this issue. Lord Judge considered that the words beyond reasonable doubt in s 133 meant that the miscarriage of justice was the conviction and incarceration of the truly innocent [248]. Lord Brown considered that there was no logical or principled dividing line between categories 2 and 3 [274] and the arguments in favour of an interpretation limited to category 1 were compelling [277]. Lord Rodger agreed with Lord Brown, and Lord Walker agreed with Lord Brown and Lord Judge. Application of s 133 to cases involving a retrial An amendment to s 133 (subsection 5A) which referred to a retrial changed the timetable for a claim for compensation. It did not mean that compensation was payable in every case in which a retrial had been ordered and the defendant then acquitted, as was argued by counsel for the intervener Barry George. The same test was to be applied. The amendment allowed for the possibility that something might emerge in the retrial which would require compensation [104]. New or newly discovered fact Lord Phillips (with whom Lady Hale, Lord Kerr and Lord Clarke agreed) held that the phrase new or newly discovered fact should be interpreted generously in accordance with the effect given to Article 14(6) by legislation in Ireland as including facts the significance of which was not appreciated by the convicted person or his advisers during the trial [60]. Lord Hope disagreed, considering that material disclosed to the defence by the time of the trial could not be said to be new and the focus on the state of mind of the convicted person went too far [107]. Lord Judge (with whom Lords Brown, Rodger and Walker agreed) preferred an approach which coincided with the test for admission of fresh evidence before the Court of Appeal, which required a reasonable explanation for the failure to adduce the evidence at the trial. This had been satisfied by Mr Adams in his case [281]. Disposal of the appeals Mr Adams appeal was unanimously dismissed on the ground that his was a category 3 case and did not fall within s 133. The majority allowed the appeals of Mr McCartney and Mr MacDermott as it had been shown conclusively that the evidence against them had been so undermined that no conviction could possibly be based upon it. The minority would have remitted their cases to the Secretary of State for further consideration in the light of the judgment.

longest

These appeals raise the question whether it was lawful for the Secretary of State to make subordinate legislation imposing a cap on the amount of welfare benefits which can be received by claimants in non working households, equivalent to the net median earnings of working households. The legislation is challenged under the Human Rights Act 1998 primarily on the basis that it discriminates unjustifiably between men and women, contrary to article 14 of the European Convention on Human Rights (the ECHR) read with article 1 of Protocol No 1 to the ECHR (A1P1). The discrimination arises indirectly. The cap affects all non working households which would otherwise receive benefits in excess of the cap. Those are predominantly households with several children, living in high cost areas of housing. The heads of such households are entitled, in the absence of the cap, to relatively high amounts of child benefit, which is payable in direct proportion to the number of children. They are also entitled, in the absence of the cap, to relatively high amounts of housing benefit, which reflects the rental cost of the accommodation in which the household lives, and tends therefore to reflect to some extent the size of the household and, more particularly, the level of rental values in the area. In practice, this means that non working households with several children, living in London, are most likely to be affected. The majority of non working households with children are single parent households, and the vast majority of single parents are women (92% in 2011). A statistically higher number of women than men are therefore affected by the cap. The great majority of single parent non working households are however unaffected by the cap. It is argued that the cap also affects victims of domestic violence, because they may be temporarily housed in accommodation which is relatively expensive (the rent for such accommodation having tended to reflect the amount of housing benefit payable), and in that event are entitled, in the absence of the cap, to relatively high amounts of housing benefit. That will also be the position if they are entitled to housing benefit in respect of both the temporary accommodation and also other accommodation to which they hope to return. Victims of domestic violence are also predominantly women. The justification put forward for the cap is one of economic and social policy, namely that it is necessary (1) to set a reasonable limit to the extent to which the state will support non working households from public funds, (2) to provide the members of such households of working age with a greater incentive to work, and (3) to achieve savings in public expenditure at a time when such savings are necessary in the interests of the economic well being of the country. Article 14 Article 14 provides: The enjoyment of the rights and freedoms set forth in this Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status. As is apparent from its terms, article 14 can only be considered in conjunction with one or more of the substantive rights or freedoms set forth in the Convention. In the present case, the relevant right is that set forth in A1P1: Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law. The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties. The appeal has been argued on the basis that the cap constitutes an interference with the peaceful enjoyment of possessions, within the meaning of A1P1. The general approach followed by the European Court of Human Rights in the application of article 14 was explained by the Grand Chamber in Carson v United Kingdom (2010) 51 EHRR 369, para 61: In order for an issue to arise under article 14 there must be a difference in the treatment of persons in analogous, or relevantly similar, situations. Such a difference of treatment is discriminatory if it has no objective and reasonable justification; in other words, if it does not pursue a legitimate aim or if there is not a reasonable relationship of proportionality between the means employed and the aim sought to be realised. A violation of article 14 therefore arises where there is: a difference in treatment, (1) (2) of persons in relevantly similar positions, if it does not pursue a legitimate aim, or (3) if there is not a reasonable relationship of proportionality (4) between the means employed and the aim sought to be realised. In practice, the analysis carried out by the European court usually elides the second element the comparability of the situations and focuses on the question whether differential treatment is justified. This reflects the fact that an assessment of whether situations are relevantly similar is generally linked to the aims of the measure in question (see, for example, Rasmussen v Denmark (1984) 7 EHRR 371, para 37). In relation to the third element, the court has referred to the criteria laid down in the second paragraphs of articles 8 to 11 of the Convention as legitimate aims, where article 14 has been read in conjunction with those articles. In Sidabras v Lithuania (2004) 42 EHRR 104, for example, the court stated at para 55 that the difference in treatment pursued the legitimate aims of the protection of national security, public order, the economic well being of the country and the rights and freedoms of others. The court has also treated aims which are legitimate in the public interest in the context of A1P1, such as securing social justice and protecting the states economic well being, as legitimate aims when article 14 has been read in conjunction with that article, as for example in Hoogendijk v The Netherlands (2005) 40 EHRR SE 189 and Andrejeva v Latvia (2009) 51 EHRR 650. National authorities enjoy a margin of appreciation in assessing whether and to what extent differences in treatment are justified. The European court has emphasised the width of the margin of appreciation in relation to general measures of economic or social strategy, stating in its Carson judgment at para 61: The contracting state enjoys a margin of appreciation in assessing whether and to what extent differences in otherwise similar situations justify a different treatment. The scope of this margin will vary according to the circumstances, the subject matter and the background. A wide margin is usually allowed to the state under the Convention when it comes to general measures of economic or social strategy. Because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is in the public interest on social or economic grounds, and the court will generally respect the legislature's policy choice unless it is manifestly without reasonable foundation. That approach was followed by this court in Humphreys v Revenue and Customs Commissioners [2012] UKSC 18; [2012] 1 WLR 1545, where Lady Hale stated at para 22 that the normally strict test for justification of sex discrimination in the enjoyment of the Convention rights gives way to the manifestly without reasonable foundation test in the context of welfare benefits. Article 14 is not confined to the differential treatment of similar cases: discrimination may also arise where states without an objective and reasonable justification fail to treat differently persons whose situations are significantly different (Pretty v United Kingdom (2002) 35 EHRR 1, para 87). An example is the case of Thlimmenos v Greece (2001) 31 EHRR 411, where this type of discrimination was first recognised. The European court has also accepted that a difference in treatment may be inferred from the effects of a measure which is neutral on its face. In DH v Czech Republic (2007) 47 EHRR 59, the court stated at para 175: The court has established in its case law that discrimination means treating differently, without an objective and reasonable justification, persons in relevantly similar situations. The court has also accepted that a general policy or measure that has disproportionately prejudicial effects on a particular group may be considered discriminatory notwithstanding that it is not specifically aimed at that group. In such a case, it will again be necessary to consider whether the difference in treatment has an objective and reasonable justification, in the light of the aim of the measure and its proportionality as a means of achieving that aim. For example, a rule requiring that employees should be capable of heavy lifting will exclude a higher number of women than men, because of differences in the average bodily strength of the sexes. Whether that difference in treatment has an objective and reasonable justification will depend on whether the rule which results in the difference in treatment has a legitimate aim and is a proportionate means of realising that aim: a test which might be met in employments where it is necessary to lift heavy objects. The present case is essentially of a similar kind: the cap, in the form in which it has been established, affects a higher number of women than men because of differences in the extent to which the sexes take responsibility for the care of children following the break up of relationships. Whether that differential effect has an objective and reasonable justification depends on whether the legislation governing the cap, which brings about that differential effect, has a legitimate aim and is a proportionate means of realising that aim. When applying article 14 in the context of welfare benefits, the European court recognises the need for national rules to be framed in broad terms, which may result in hardship in particular cases. In its Carson judgment, for example, the Grand Chamber stated at para 62: The court observes at the outset that, as with all complaints of alleged discrimination in a welfare or pensions system, it is concerned with the compatibility with article 14 of the system, not with the individual facts or circumstances of the particular applicants or of others who are or might be affected by the legislation. Much is made in the applicants' submissions and in those of the third party intervener of the extreme financial hardship which may result from the policy . However, the court is not in a position to make an assessment of the effects, if any, on the many thousands in the same position as the applicants and nor should it try to do so. Any welfare system, to be workable, may have to use broad categorisations to distinguish between different groups in need. the court's role is to determine the question of principle, namely whether the legislation as such unlawfully discriminates between persons who are in an analogous situation. It is important to bear this in mind in the present case, where much has again been made of the financial hardship which, it is argued, may result from the cap in particular cases. The relevant question, however, is whether the legislation as such unlawfully discriminates between men and women. The present case In considering the issues arising under article 14 in the present case, I shall begin by examining the process which led to the legislation with which we are concerned, in order to identify the aims pursued by the legislation and information relevant to the issue which the court has to determine. Consideration of the Parliamentary debates for that purpose is not inconsistent with anything said in the case of Wilson v First County Trust Ltd (No 2) [2003] UKHL 40; [2004] 1 AC 816: the purpose of the exercise is not to assess the quality of the reasons advanced in support of the legislation by Ministers or other members of Parliament, nor to treat anything other than the legislation itself as the expression of the will of Parliament. The Welfare Reform Bill On 22 June 2010 the Chancellor of the Exchequer laid before Parliament his Emergency Budget: Budget 2010 (HC 61). It set out a five year plan to rebuild the British economy by reducing the structural fiscal deficit. The plan involved reductions in Government spending of 32 billion per annum by 2014/15. These reductions would include 11 billion in savings achieved through reforms of welfare. The reforms were intended to make the welfare system fairer and more affordable, to reduce dependency, and to promote employment. The following month, the Department for Work and Pensions (the Department) published a consultation document, 21st century Welfare (Cm 7913), seeking views on options to reform the system of working age benefits. In response to a question about the steps which the Government should consider to reduce welfare dependency and poverty, many respondents answered that the most effective way would be to ensure that people were significantly better off working than on benefit, and suggested the introduction of a benefit cap to restrict the amount of welfare payments which people could receive while out of work: Consultation Responses to 21st century Welfare (2010) (Cm 7971). A common view was that the cap should be set by reference to the national minimum wage. This idea was then discussed at the Departments Policy and Strategy Forum, at which the Department engages with groups representing benefit recipients. On 11 October 2010 the Secretary of State announced the Governments intention to set a cap on benefits for non working households. Further details were provided in the Spending Review 2010 (Cm 7942), which announced the intention to cap non working household benefits at around 500 per week for couple and single parent households, and around 350 per week for single adult households, so that no non working household would receive more in welfare than the median after tax earnings of working households. A household would comprise one or two adults living together as a couple, plus any dependent children living with them. The cap would be implemented by local authorities, which would assess the benefit income of housing benefit claimants, and reduce the payments of housing benefit where necessary to ensure that they did not receive more than the cap. It is relevant to note, in relation to submissions concerning the impact of the cap upon children, that the Spending Review made clear the Governments belief that the proposed reforms would promote the interests of children: The UK's existing system of support can trap the poorest families and children in welfare dependency. For many poor children the current system of support delivers little practical change in their long term economic prospects. Many born into the very poorest families will typically spend their entire lives in poverty. The Government wants to fundamentally change the prospects of these children. (para 1(54)) Contemporaneously with the Spending Review, HM Treasury published its Overview of the Impact of Spending Review 2010 on Equalities. This document considered the impact of the Spending Review on groups protected by equalities legislation, including women. It noted that decisions had been taken within the Spending Review which protected most of the services which women used more than men, in particular health, social care, early years and childcare. In order to protect those areas of spending, savings had to be made in other areas, including welfare. In relation to benefits, it was noted that any changes affecting single parent households would affect more women than men. In November 2010 the White Paper, Universal Credit: Welfare That Works (Cm 7957) was published. It included the benefit cap as part of the design of universal credit. The Parliamentary Select Committee on Work and Pensions considered the White Paper, and received evidence from, amongst others, the two interveners in the present proceedings, the Child Poverty Action Group and Shelter, as to the likely impact of the cap: House of Commons Work and Pensions Committee, White Paper on Universal Credit, Oral and Written Evidence (2011) (HC 743). The impact on larger families, and those living in high cost areas, was highlighted. That reflected the fact, recognised from the outset, that the cap would primarily affect households receiving large amounts of child related benefits and large amounts of housing benefit. On 16 February 2011 the Welfare Reform Bill received its First Reading in the House of Commons. Clauses 93 and 94 set out the proposed provisions in respect of a benefit cap. As is customary in the area of social security, the clauses were drafted on the footing that the primary legislation would establish a framework for secondary legislation in which the rules would be set out in detail. At the same time, the Department laid before Parliament an Impact Assessment for the Household Benefit Cap. That document explained the three policy aims: to deliver fiscal savings, to make the system fairer as between non working households and working households, and to incentivise the non working to work. It explained the policy options which had been considered, and the reasons for adopting the preferred option. In particular, it explained that consideration had been given to applying the cap to working households which also received benefits, but that it had been decided that they should be exempted, as including recipients of working tax credit among those affected by the cap would seriously reduce incentives to work (p 5). It had also been decided to exempt those in receipt of disability living allowance and constant attendance allowance, as disabled people with additional care or mobility costs had less ability to alter their spending patterns or reduce their housing costs in response to a cap on benefit. War widows and widowers would also be exempted, in order to recognise their sacrifice. Consideration had also been given to setting the cap at a different level, but it was decided that to base it on net median household earnings would best represent the average take home pay of working households. 26. The document explained that about 50,000 households would have their benefits reduced (representing around 1% of the out of work benefit case load), and that affected households would lose an average of 93 per week. Those affected by the cap would need to choose between taking up work (in which event they would no longer be affected), obtaining other income (such as child maintenance payments from absent parents: other reforms were designed to make it more difficult for absent parents to evade their obligation to provide financial support to single parents), reducing their non rent expenditure, negotiating a lower rent, or moving to cheaper accommodation. In March 2011 the Department laid before Parliament its Household Benefit Cap Equality Impact Assessment. The document stated that the cap was intended to reverse the disincentive effects and detrimental impacts of benefit dependency on families and children (para 5). The likely impact was analysed according to disability, race, gender, age, gender reassignment, sexual orientation, religion or belief, and pregnancy or maternity. In relation to gender, it was estimated that around 60% of claimants who had their benefits cut would be single females, whereas 3% would be single men. That was because around 60% of households affected would comprise single parents living with children, and single parents living with children were predominantly women. The impact of the cap on single parents would be mitigated by the provision of support to help them to move into work. Single parents would also be exempt from the cap if they worked for only 16 hours per week, whereas other single claimants would have to work for at least 30 hours per week before they were exempt. 27. The policy was subjected to detailed and vigorous scrutiny by both Houses of Parliament, over a period of more than 12 months, during the passage of the Bill through Parliament. That scrutiny was assisted by a number of House of Commons Research Papers, and by briefings prepared by organisations opposed to the policy. During the Committee stage which followed the Second Reading debate in the House of Commons, the Public Bill Committee also received evidence from many organisations with an interest, including the interveners. Consideration was also given to reports on the Bill produced by the Office of the Childrens Commissioner, which focused upon the impact on children, and by the Equality and Human Rights Commission. The former report expressed concern about the potential impact on children if households affected by the cap moved home in order to reduce their housing costs. It also expressed concern about the potential impact if households were unable to reduce their housing costs. 28. The discussion in Committee, and in the earlier Second Reading debate, concerned a number of issues, including the impact of the cap on single parents, its impact on children, its impact on those living in temporary 29. 30. accommodation, and the appropriateness of fixing the cap according to the net median earnings of working households, when working households receiving net median earnings might also receive certain benefits. In relation to the impact on single parents, it was argued that if such households included children under five years of age, there would be less likelihood of the parent being able to take up work, because of child care responsibilities and the potential cost of child care. Amendments to the Bill were tabled in Committee that would have exempted households from the cap where a single parent had children under five years of age, or where work was not financially more advantageous due to child care costs. In relation to the impact on children, it was argued that if households whose benefits were capped moved to areas where housing was less expensive, there could be consequent disruption in the supervision of children who were at risk of abuse, and also disruption of childrens schooling. If such households did not move to cheaper areas, they would have to economise in other ways. Amendments were moved in both Houses that child related benefits should be excluded from the scope of the cap, and that the cap should be related to household size. 32. 31. The potential impact on households living in temporary accommodation, at a relatively high cost, was also emphasised. Amendments were moved in both Houses that would have exempted households which were owed a duty by the local authority to be supported in temporary accommodation. In relation to the use of net median household earnings as the benchmark, it was argued that the cap would leave the households affected worse off than working households with equivalent earnings, since some benefits were payable to households receiving average earnings. An amendment was tabled in Committee to require the cap to reflect net average earnings plus in work benefits which an average earner might expect to receive: Hansard (HC Debates), 17 May 2011, col 970. An amendment to similar effect was also proposed in the House of Lords. In responding to these arguments during the discussion in Committee on 17 May 2011, the Minister emphasised the need to create a welfare system which was fair in the eyes of the general public and commanded public confidence, and the need to address a culture of welfare dependency. In relation to the former point, he stated that it did no service to welfare claimants if they were seen to be receiving amounts of money from the state that exceeded the average earnings of people who were working. That encouraged the view that 33. 34. 35. 36. there was something wrong, and it had the effect of stigmatising those claimants. It was important to help people into work, and it was also important to have a welfare system in which the public had confidence. At present, it was clearly demonstrable that that was not the case (col 950). In that regard, the Minister referred to the stigmatisation of non working families who received high levels of benefit, and to the level of public support for the introduction of a cap on benefits. He went on to say that it was not reasonable or fair for out of work households to have a greater income from benefits than the net average weekly wage of working households (col 952). The proposed cap for couples and families was equivalent to an earned salary of 35,000 per annum, which was considered fair (col 984). In response to the argument that average earnings were not a proper basis for comparison, since households on average earnings might also be in receipt of benefits, the Minister responded that it was necessary, for public confidence in the benefit system, to have a cap related to average earnings. He acknowledged that the proposed level of the cap was lower than the total income of a working household on average earnings which was receiving in work benefits, but said that it was necessary to ensure that people were better off in work (cols 952 and 975). The Minister also observed that the policy would only succeed in its objectives of influencing behaviour and increasing public confidence in the benefits system if there was a simple rule which people could understand (col 954). In relation to arguments based on the different needs of different types of household, such as those with several children, the Minister observed that there was a divide in philosophical view between those who thought that the cap should vary according to household size and other characteristics, and those who believed that there should be some limit to the overall benefits that the state should provide. Working people on low incomes had to cope with difficult circumstances, and they had to live within their means (cols 952, 973). Their earnings were not determined by the size of their families, and the Government believed that the same principle should apply to the level of the cap (col 975). Households whose benefits were capped might need to move to cheaper accommodation, but like other families they had to live in accommodation that they could afford. In relation to those living in temporary accommodation, the Minister observed that local authorities had a legal duty to provide accommodation which was suitable for homeless applicants, and suitability included affordability. That observation was consistent with the decision in R (Best) v Oxford City Council [2009] EWHC 608 (Admin), approved by the Divisional Court in the present proceedings: [2013] EWHC 3350 (QB), [2014] PTSR 23, para 53. The Minister explained that, whatever the cost of the 37. accommodation might be, the local authority could pass on only a charge that the applicant could afford. The issue of housing costs for those in temporary accommodation was being considered. In relation to this matter, it is relevant to note the evidence given in these proceedings by Mr Robert Holmes, the Departments lead official on the benefit cap policy. He explains that the Government used to reimburse local authorities, via the housing benefit system, the rent which they charged claimants for the provision of temporary accommodation, up to a maximum for each property of 500 per week in London and 375 per week elsewhere. It became clear that some local authorities were using this system to generate surplus revenues, by charging claimants at or about the maximum level regardless of the rental value of the accommodation in question. Claimants in temporary accommodation were then reluctant to seek employment, as they were concerned that they might lose their housing benefit and be unable to pay these artificially inflated rents. The Government was unwilling to exempt temporary accommodation from the cap, as it considered that to do so would continue to subsidise inflated rents and would discourage claimants from obtaining work. It decided instead to provide additional support for those in temporary accommodation through the discretionary housing payments scheme, to which it will be necessary to return. 38. The Bill was also considered in detail by the House of Lords, which was provided with an updated version of the Housing Benefit Cap Equality Impact Assessment (2011). The discussion in the House of Lords focused particularly upon the impact of the cap on households with children, and upon the use of median earnings, rather than income inclusive of benefits, as the benchmark. In the course of the discussion, the Minister gave an assurance that he had considered the requirements of the Human Rights Act 1998 and the ECHR in respect of the policy, and was satisfied that the way in which the Government would implement the clauses in question would meet those requirements (Hansard (HL Debates), 21 November 2011, col GC415). In relation to the use of median earnings as the basis of the cap, the Minister explained that it necessarily followed, by definition, that half the working households in the UK would have earnings below the level of the cap (col GC425). In relation to the impact of the cap on households with children, an amendment seeking to exempt single parents with children under five was opposed by the Government. In response to the argument that, since such parents were not obliged to seek work in order to be eligible to receive benefits, they ought also to be exempted from the cap on the amount of any 39. 40. benefits which they might receive, the Minister stated that the cap was intended to act as an incentive to work. Although single parents with children under five were not required to seek work as a condition of receiving benefits, that did not mean that the Government did not want to encourage them to find employment. The amendment would undermine the fundamental principles underpinning the cap: that ultimately there had to be a limit to the amount of benefit that a household could receive, and that work should always pay (col GC421). 41. A proposed amendment to exclude child benefit from the scope of the cap was opposed by the Government on the basis that its policy was that there should be a reasonable limit to the overall amount of support that non working households could receive in welfare payments, that child benefit was as much part of that support as other welfare payments, and that it should therefore be taken into account in deciding whether the limit had been reached. It was estimated that excluding child benefit from the scope of the cap would reduce the savings from the cap by 40 to 50%, and that also excluding child tax credit would reduce the savings by 80 to 90% (Hansard (HC Debates), 28 November 2011, col 763W). There would be a similar impact upon the number of households affected (Hansard (HC Debates), 23 May 2011, col 496W). 42. The Bill was also scrutinised by the House of Lords and House of Commons Joint Committee on Human Rights, which considered the human rights effects of the Bill and published its report in December 2011 (HL Paper 233; HC 1704). In written evidence to the Committee, the Secretary of State stated that it was the Governments view that, if A1P1 was engaged, the measures in the Bill were proportionate to the legitimate aim of securing the economic well being of the country. He observed that the greater employment of single parents would have a positive effect on child poverty, and that there was a wide range of support available to single parents seeking employment, to take account of their role as the main carer for their child. He added that the Government believed that the effect of the cap was proportionate, taking into account (1) the amount of the cap and the fact that it would be based on average household earnings, (2) the fact that claimants would be notified of the cap and given time to adjust their spending to accommodate their new levels of benefit, and (3) the fact that the cap would affect relatively few households and that those affected would continue to receive a substantial income from benefits. 43. At the Report stage in the House of Lords, the Bill was amended so as to exclude child benefit from the scope of the cap. When the Bill returned to the House of Commons, the House considered and voted against that amendment. When the Bill subsequently returned to the House of Lords, the House agreed, on a vote, not to insist on the amendment. 44. During the Bills passage, Ministers indicated that some of the concerns expressed in Parliament, many of them reflected in other proposed amendments, would be considered as the policy was developed. So it proved. One example was the introduction of a period of grace for benefit claimants who had previously been employed, so that their benefits would not be capped for a period of 39 weeks after they had last been in employment. That development reflected concerns which had been expressed about the application of the cap to households in which someone had been in work but had been made redundant or had left work in order to care for a child. It was also understood that child care responsibilities might make it difficult for some single parents to seek work and, by that means, to secure exemption from the cap. Measures were taken to address those difficulties by exempting benefits used to pay for child care (meeting 70% of the cost) from the cap, by providing single parents with job focused interviews to assist them in finding work, and by setting the number of hours required to be worked by a single parent, in order to obtain exemption from the cap, at a lower level, of 16 hours per week, than for other claimants. Another development was the introduction of an exception to prevent payments covering the cost of accommodation in refuges, for women who had been victims of domestic violence, from being taken into account. It will be necessary to return to that matter. Measures were also taken to ensure that the supervision of children at risk of ill treatment was not jeopardised in the event that their families moved to less expensive areas to live. 45. A decision was also taken to provide additional funding of 65m in 2013/2014 and 35m in 2014/15 for discretionary housing payments under the Discretionary Financial Assistance Regulations 2001 (SI 2001/1167) (the DHP Regulations). These are payments made by local authorities to claimants who require further financial assistance, in addition to any welfare benefits, in order to meet housing costs. They do not count towards the cap. As is stated in the guidance for local authorities published by the Government, the additional funding is intended to provide assistance to a number of groups who are likely to be particularly affected by the cap, including those in temporary accommodation, victims of domestic violence, families with children at school, and households moving to, or having difficulty finding, more appropriate accommodation. Households in those categories may be unable to avoid high costs in the short term: they may, for example, have to delay a move until suitable arrangements can be made for the education of children, or may require financial assistance to pay the deposit on a new home and the initial instalment of rent. The additional funding was intended to help them to meet those costs. The Government also undertook to review the operation of the cap, as had been recommended by the Joint Committee on Human Rights, and to lay before Parliament a report on its impact after a year of operation. The Welfare Reform Act 2012 46. The Welfare Reform Act 2012 (the 2012 Act) received Royal Assent in March 2012. The provisions relevant to the cap are sections 96 and 97. 47. Section 96 enables regulations to provide for a benefit cap to be applied to the welfare benefits to which a single person or couple is entitled. For the purposes of the section, applying a benefit cap means securing that: where a single persons or couples total entitlement to welfare benefits in respect of [a period of a prescribed duration] exceeds the relevant amount, their entitlement is reduced by an amount up to or equalling the excess (section 96(2)). 48. Welfare benefits are any benefit, allowance, payment or credit prescribed in regulations: section 96(10). The regulations cannot however prescribe as welfare benefits either state pension credit or retirement pensions: section 96(11). The relevant amount is an amount specified in regulations, which must be determined by reference to the average weekly earnings of a working household after deductions in respect of tax and national insurance: sections 96(5), (6) and (7). More detailed provision in respect of the benefit cap arrangements, including the welfare benefits or benefits from which a reduction is to be made, and any exceptions to the application of the benefit cap, are to be set out in the regulations: section 96(4). The regulations are to be made by the Secretary of State, and the first such regulations must be approved by Parliament under the affirmative resolution procedure: sections 96(10) and 97(3). Subsequent regulations must be approved under the negative resolution procedure. The Benefit Cap (Housing Benefit) Regulations 2012 49. Before laying draft regulations before Parliament, the Department consulted interested bodies, including the statutory Social Security Advisory Committee, Citizens Advice, Crisis and Shelter. That consultation influenced some of the policy changes which I mentioned in paras 44 45. 50. On 16 July 2012 the Benefit Cap (Housing Benefit) Regulations 2012 (SI 2012/2994) (the Regulations) were laid in draft before both Houses of Parliament. At the same time, the Department published updated impact assessments in respect of the cap. It was then estimated that 56,000 households would be affected (1% of the out of work benefit caseload), losing on average around 93 per week. 39% of households affected were expected to be couples with children, and 50% were expected to be single parents with children. Because single parents were predominantly women, 60% of affected claimants were expected to be single women, compared with 10% who were expected to be single men. Almost all the local authorities most affected were expected to be in London, reflecting the higher rents payable there. 51. Parliament received submissions on the draft regulations from a number of bodies, including Shelter. The draft regulations were considered by the House of Lords Secondary Legislation Scrutiny Committee, and were debated by the House of Lords Grand Chamber on 6 November 2012. They were also considered by the House of Commons Delegated Legislation Committee on the same date. The issues then considered included temporary accommodation, including womens refuges and other accommodation for victims of domestic violence, the impact upon children of households moving to areas where housing was less expensive, and the greater difficulty which people who moved out of London might experience in obtaining work. The draft regulations were approved by both Houses of Parliament, and the Regulations were then made. 52. As had been announced, the Regulations fix the cap at 350 per week for single persons and 500 for families and couples, equivalent to gross salaries of 26,000 and 35,000 per annum respectively. These figures are slightly above the median earnings of single persons and couples respectively. They are well above the national minimum wage, which in 2012 was about 12,500 per annum for a 40 hour week. The Regulations list the benefits which are to be treated as welfare benefits. As anticipated, they include the main out of work benefits, together with child benefit, child tax credit and housing benefit. Again as anticipated, exceptions from the application of the cap are made in respect of households where a person receives specified benefits based on disability or service in the armed forces, and in respect of households where a single parent works for 16 hours per week or a couple work for 24 hours (provided one of them works for 16 hours). Provision is made for the 39 week period of grace. In response to concerns expressed about the potential impact of the cap on households living in exempt accommodation (ie accommodation provided by housing associations, charities, other voluntary bodies or county councils to 53. persons receiving care, support or supervision provided by or on behalf of the landlord), including in particular those living in refuges for victims of domestic violence, the Regulations were amended with effect from 15 April 2013 (when, as I shall explain, the cap first came into partial effect) by the Benefit Cap (Housing Benefit) (Amendment) Regulations 2013 (SI 2013/546). The effect of the amendment was that housing benefit provided in respect of such accommodation was to be disregarded for the purposes of the cap. In response to contentions that some womens refuges fell outside the definition of exempt accommodation, the Minister announced in April 2013 that the issue was being addressed and that proposals would be brought forward at the earliest opportunity. The Housing Benefit and Universal Credit (Supported Accommodation) (Amendment) Regulations 2014 (SI 2014/771) (the 2014 Regulations) were subsequently made, after the present proceedings were under way. They replace the concept of exempt accommodation with a broader concept of specified accommodation, which encompasses a wider range of accommodation provided for vulnerable people, including the womens refuges previously excluded. The implementation of the Regulations 54. The Regulations were made in November 2012, more than two years after the intention to introduce the cap had been announced. From April 2012 jobcentres and local authorities implemented arrangements to provide support to households that would be affected by the cap and assist them in deciding how to respond. In May 2012 jobcentres wrote to all claimants potentially affected by the cap, notifying them that they might be affected and explaining the support available. That support included assistance from dedicated staff in moving into the labour market, obtaining access to child care provision and negotiating rent reductions with private landlords, together with advice on housing options and household budgets. A help line was also set up to provide information about the changes and the support available. Employment events were organised with local employers and training bodies. Further letters were sent to claimants in October 2012, February 2013 and March 2013. Claimants were also contacted by telephone and, where that proved ineffective, were visited. The cap was then introduced in phases, during which its impact was monitored by the Department. On 15 April 2013 the cap was applied in four local authority areas in London. Between 15 July 2013 and the end of September 2013 the cap was applied in other local authority areas. 55. Since the introduction of the cap, its impact has been discussed at meetings of the Benefit Cap Project, a forum for meetings between the Department and interested bodies, including voluntary organisations working with children and the homeless. 56. From August 2013 the Department published a number of reports on the impact of the cap. The most recent report, at the time when these appeals were heard, was that published in March 2014, which contained data for the period to January 2014. It reported that 38,665 households had had their housing benefit capped. 28% of the households which had at one time been capped were no longer capped. 39% of those had become exempt because a member of the household had entered work. 27% were no longer claiming housing benefit or had reduced their rent so as to come below the cap. Of the 20 local authorities with the highest number of capped households, 19 were in London. 95% of capped households included children. 59% of capped households, and 62% of capped households with children, comprised a single parent with children. In response to a request from this court, counsel also provided the Departments analysis of the data for the period up to March 2014 in respect of single parent households including a child under five years of age. 29% of such households which had at one time been capped were no longer capped. 38% of those had become exempt because a member of the household had entered work. These figures are in line with those for all households. 57. 58. According to the Departments most recent estimate as at the date of the hearing, the cap is expected to save 110m in 2013/2014 and 185m in 2014/2015. This level of savings is expected to continue over the longer term. These figures do not take into account the implementation costs or the additional funding made available for discretionary housing payments. Nor, on the other hand, do they take account of any reduction in benefit payments, or any receipts from income tax or national insurance, resulting from claimants moving into work. The present proceedings 59. There is no challenge in these proceedings to the 2012 Act: it is not argued that section 96 is incompatible with the ECHR. It follows that there is no challenge to the principle of a cap, the impact of which is inevitably greatest for those who would otherwise be entitled to the highest amount of relevant benefits. Nor is there any challenge to the fixing of one relevant amount (ie the cap) for single claimants and another for all other households, rather than the relevant amount being tailored to individual circumstances. Nor is there any challenge to the fixing of the relevant amount by reference to estimated average net household earnings, rather than by reference to estimated average net household income inclusive of benefits. The challenge is primarily to the compatibility of the Regulations with article 14 of the ECHR read in conjunction with A1P1. Compatibility with article 14 read with A1P1 60. Interference with possessions In considering the compatibility of the Regulations with article 14 in conjunction with A1P1, the first question is whether there is an interference with possessions. That is not a straightforward question: as the European court explained in Valkov v Bulgaria (Applications Nos 2033/04, 19125/04, 19475/04, 19490/04, 19495/04, 19497/04, 24729/04, 171/05 and 2041/05) (unreported) given 25 October 2011 at para 85, a cap may be regarded either as a provision limiting the amount of benefit after it has been calculated under the general rules, and thus an interference with a possession of the appellants, or as part of the overall set of statutory rules governing the manner in which the amount of benefit should be calculated, and thus as amounting to a rule preventing the appellants from having any possession in relation to the surplus. It is however unnecessary to resolve that question in the present appeal, since the applicability of A1P1 has not been contested on behalf of the Secretary of State. Differential treatment 61. The next question is whether the Regulations result in differential treatment of men and women. This is conceded on behalf of the Secretary of State. Given the statistics as to the proportion of those affected who are single women as compared with the proportion who are single men, that concession is understandable. It is indeed almost inevitable that a measure capping the benefits received by non working households will mainly affect households with children, since they comprise the great majority of households receiving the highest levels of benefits. It follows inexorably that such a measure will have a greater impact on women than men, since the majority of non working households with children are single parent households, and the great majority of single parents are women. That consequence could be avoided only by defining welfare benefits so as to exclude benefits which are directly or indirectly linked to responsibility for children, a possibility to which it will be necessary to return. 62. On the other hand, the argument that the Regulations also result in differential treatment of women because of their effect upon the victims of domestic violence has not in my opinion been established. In so far as the argument is based upon the failure of the Regulations, as originally made, to exempt housing benefit received in connection with all womens refuges, the amendments effected by the 2014 Regulations were designed to address that problem, and it is not argued in these appeals that they have failed to do so. In so far as the argument was that women fleeing domestic violence may live in temporary accommodation rather than refuges, and may then be entitled to housing benefit in respect of both their original home and the temporary accommodation, that problem, which is inherently of a temporary nature, is capable of being addressed under the DHP Regulations by the use of discretionary housing payments; and the funding made available by Government for such payments has been increased for that very purpose. As I have explained, guidance has been issued by the Government to local authorities advising them that the funding is specifically aimed at groups including individuals or families fleeing domestic violence, and that payments can be awarded for two homes when someone is temporarily absent from their main home because of domestic violence. It cannot therefore be said that the Regulations have a disparate impact upon victims of domestic violence. Whether problems are avoided in practice will depend upon how the discretionary payments scheme is operated by local authorities in individual cases. It is not suggested that any problems have arisen in the cases with which these appeals are concerned. Legitimate aim 63. The next question is whether the Regulations pursue a legitimate aim. In my view that cannot be doubted. They pursue, in the first place, the aim of securing the economic well being of the country, as the Secretary of State explained to the Parliamentary Joint Committee on Human Rights, and as is evident from the legislative history since the policy of reducing expenditure on benefits was first announced in June 2010. A judgment was made, following the election of a new Government in May 2010, that the current level of expenditure on benefits was unaffordable. The imposition of a cap on benefits was one of many measures designed to reduce that expenditure, or at least to constrain its further growth. It was argued on behalf of the appellants that savings in public expenditure could never constitute a legitimate aim of measures which had a discriminatory effect, but that submission is inconsistent with the approach adopted by the European court in the cases mentioned in para 10. It is also inconsistent with the acceptance of the economic well being of the country as a legitimate aim of interferences with Convention rights under the second paragraphs of articles 8 to 11, and under A1P1. An interpretation of the Convention which permitted the economic well being of the country to constitute a legitimate aim in relation to interferences with the substantive Convention rights, but not as a legitimate aim in relation to the ancillary obligation to secure the enjoyment of those rights without discrimination, would lack coherence. 64. In relation to the case of Ministry of Justice (formerly Department for Constitutional Affairs) v OBrien (Council of Immigration Judges intervening) [2013] UKSC 6; [2013] 1 WLR 522, para 69, on which the appellants relied, I would observe that acceptance that savings in public expenditure can constitute a legitimate aim for the purposes of article 14 does not entail that that aim will in itself constitute a justification for discriminatory treatment. As I have explained, the question whether a discriminatory measure is justifiable depends not only upon its having a legitimate aim but also upon there being a reasonable relationship of proportionality between the means employed and the aim sought to be realised. 65. The second aim, of incentivising work, is equally legitimate. It is, in the first place, an aspect of securing the economic well being of the country. It has however a broader social objective which Ministers made clear to Parliament. That objective is based on the view that long term unemployment is socially undesirable, because of its impact upon those affected by it (including the children brought up in non working households), and that it is therefore important to make efforts to assist those capable of working to find work: efforts which can include the removal of financial disincentives. 66. The third aim, of imposing a reasonable limit upon the total amount which a household can receive in welfare benefits, is in my opinion equally legitimate. It is again an aspect of securing the economic well being of the country: it is one of the means of achieving that objective. It also however has a broader aspect, namely to reflect a political view as to the nature of a fair and healthy society. As Ministers explained to Parliament, this objective responds in particular to a public perception that the benefits system has been excessively generous to some recipients: a perception which is related to the stigmatisation in the media of non working households receiving high levels of benefit. The maintenance of public confidence in the welfare system, so that recipients are not stigmatised or resented, is undeniably a legitimate aim. In the language used by the European court in Hoogendijk and other cases, the benefit system is the means by which society expresses solidarity with its most vulnerable members. That being so, it is in principle legitimate to reform the system when necessary to respond to a threat to that solidarity. Proportionality 67. The remaining question is whether the Regulations maintain a reasonable relationship of proportionality between the means employed and the aims sought to be realised. 68. It was argued by counsel for the appellants and interveners that the aim of setting a reasonable limit to the amount of benefits which a household can receive could have been achieved by using as a benchmark not the average earnings of working households but their average income inclusive of benefits. This would have been fair, adopting the adjective used by Ministers at some points during the Parliamentary debates, since it would have achieved parity between the maximum income received by non working households and the average income of working households. 69. There are three problems with this argument. The first is that section 96 of the 2012 Act, whose compatibility with Convention rights is not challenged, requires the cap to be set by reference to earnings. The Regulations cannot be unlawful in so far as they follow that approach (Human Rights Act, section 6(2)(a)), and would be ultra vires if they failed to do so. Secondly, the assessment of the level at which a cap would represent a fair balance between the interests of working and non working households is a matter of political judgment. Furthermore, the assumption that fairness requires an equivalence between the incomes of working and non working households ignores the costs incurred by working households in earning that income: both financial costs in respect of such matters as travel and clothing, and non financial costs in respect of the time spent commuting and working. As the Thlimmenos principle illustrates, non discrimination does not require that different situations should be treated in the same way. Thirdly, and in any event, the Government has made a judgment, endorsed by Parliament, that a cap set at the level of the average income of working households would be less effective in achieving its aims. That is not an unreasonable judgment: plainly, the fiscal savings would be less, and the financial incentive to find work would be reduced. Indeed, if the cap were set at a level which achieved parity between the income of a person on benefits and the average income of a person in work, it would act as a disincentive to work for below average earnings. Whether the aim of securing a benefit system which was perceived by the public as fair and reasonable would also have been less effectively achieved is again a political judgment, which cannot be said to be manifestly unreasonable. It was also argued that the short term fiscal savings appear to be relatively marginal at best. It is true that the savings made are a small proportion of the total welfare budget, the bulk of which is spent on pensions. They nevertheless contribute towards the achievement of the objective of reducing the fiscal deficit. It is also necessary to bear in mind that the Regulations are designed to result in savings over the longer term, as the intended change in the welfare culture takes effect. 70. 72. 71. Other criticisms of the Regulations focused upon the impact of the cap upon the income of the households most severely affected, such as those of the appellants. Emphasis was placed in particular upon the inclusion of child benefit and child tax credit among the welfare benefits, and the difficulties which single parents faced with a loss of income might encounter in finding work, because of their child care responsibilities, or in moving to cheaper accommodation, because of the impact upon their children. In relation to the reduction in income, it has to be borne in mind that the cap for a household with children has been set by Parliament at the median earnings of working households, equivalent to a salary of 35,000 per annum. By definition, half of all working households earn less than that amount. The exclusion of child benefit and child tax credit from the welfare benefits counting towards the cap would enable non working households with children to receive an income from public funds in excess of that amount. Whether that level of benefits ought to be paid by the state is inherently a political question on which opinions within a democratic society may reasonably differ widely. It is not the function of the courts to determine how much public expenditure should be devoted to welfare benefits. It is also important to recognise that the households affected were given advance notice of the reduction in their income, and that assistance was made available to them to enable them to address the implications, as I have explained. In relation to the related criticism that children in households affected by the cap are deprived of the basic necessities of life, that argument was rejected by the courts below, and I see no basis for reaching a different conclusion. As I have explained, the cap for a household with children is equivalent to a gross salary of 35,000 per annum, higher than the earnings of half the working population in the UK, almost three times the national minimum wage, and not far below the point at which higher rate tax becomes payable (in 2013/14, a salary of 41,450). Although the compatibility of the Regulations with article 14 does not depend on the individual circumstances of the appellants, as I have explained, the Court of Appeal considered in detail submissions to the effect that the cap would reduce them to a state of destitution, and concluded that their circumstances did not approach that level. The Divisional Court noted that even in cases where the cap had particularly adverse consequences, in the last resort the local authority was under a duty to secure suitable and affordable accommodation for the family. In relation to the difficulties of finding work, data from the Office for National Statistics (ONS) indicate that 63.4% of single parents with dependent children were in work during the second quarter of 2014. An ONS analysis based on data for 2012 indicated that the employment rate for single 73. 74. 75. parents with a dependent child under the age of 2 was 32%; for the age range 2 4 it increased to 42%; for the age range 5 11 it was 63%. Plainly, many single parents, including those on low incomes, make arrangements for the care of children in order to work. Their children over five years of age are required to attend school. Their younger children may attend nurseries or may be looked after by family members or child minders. The amount of work which a single parent has to perform, in order to be exempted from the cap, is only 16 hours per week. Even those hours need not necessarily be worked throughout the year: if a person works in a place of employment which has a recognisable cycle of employment, such as a school, the holiday periods during which she does not work are disregarded. As I have explained, assistance with meeting the cost of child care is available and is excluded from the cap. The statistics set out at paras 56 and 57 above do not support the contention that single parents with children under five have experienced greater difficulty in obtaining work than other claimants affected by the cap. Some people take the view that it is better for the single parent of a young child to remain at home full time with the child, but there is no basis for requiring that view to be adopted by Government as a matter of law. In relation to the argument that households with children cannot reasonably be expected to move house, because of the impact on the children, it is not merely a forensic point that one of the two adult appellants came with her family to the UK from Belgium, and that the other adult appellant came with her family to the UK from Algeria. Millions of parents in this country have moved house with their children, for a variety of reasons, including economic reasons. It is, in particular, not uncommon for working households to move out of London in order to find more affordable property elsewhere. It is also necessary to recognise that transitional financial assistance is available for households affected by the cap who cannot move until suitable arrangements have been made in relation to the children, as I have explained. Although assistance of that nature may not constitute a complete or satisfactory answer to a structural problem of a permanent nature arising from discriminatory legislation, such as the inadequacy of housing benefit to meet the cost of accommodation suitable for the needs of severely disabled claimants (as was held in Burnip v Birmingham City Council [2012] EWCA Civ 629; [2013] PTSR 117), it is relevant to an assessment of the proportionality of a measure which is liable to give rise to transitional difficulties in individual cases. 76. As I have explained, the court is concerned in a case of this kind with the question whether the legislation as such unlawfully discriminates between men and women, rather than with the hardship which might result from the cap in the cases of those most severely affected. In that regard, it is highly significant that no credible means was suggested in argument by which the legitimate aims of the Regulations might have been achieved without affecting a greater number of women than men. Put shortly, since women head most of the households at which those aims are directed, it appears that a disparity between the numbers of men and women affected was inevitable if the legitimate aims were to be achieved. 77. The greater number of women affected results from the inclusion of child related benefits within the scope of the cap. If those benefits had been excluded from the cap, the legitimate aims of the cap would not have been achieved, as Ministers made plain to Parliament. The question is raised by Lady Hale whether taking child related benefits out of the cap as it applies to single parents only would have an emasculating effect. I do not recall this point being raised with counsel for the Secretary of State, but the information available enables it to be considered. Parliament was informed that the exclusion of child related benefits would reduce the savings, and the number of households affected by the cap, by 80 to 90% (para 41). According to the most recent statistics available at the time of the hearing, single parent households form 62% of the affected households receiving child related benefits (para 56). It is therefore plain that the exclusion of child related benefits, even if confined to single parent households, would have compromised the achievement of the legitimate aims of the Regulations. Article 3(1) of the UNCRC 78. An argument of a different character was put forward on the basis of article 3(1) of the United Nations Convention on the Rights of the Child (UNCRC), which provides that in all actions concerning children the best interests of the child shall be a primary consideration. The argument developed during and after the hearing of the appeal. Initially, it was contended that the Secretary of State was obliged by section 6 of the Human Rights Act to treat the best interests of children as a primary consideration when making the Regulations, in accordance with article 3(1) of the UNCRC, since the cap had an impact upon the private and family lives of children forming part of the households affected. Article 8(1) of the ECHR was therefore applicable. Since the European court would have regard to the UNCRC when applying article 8 in relation to children, it followed that the Secretary of State was also obliged to comply with article 3(1) of the UNCRC, but failed to do so. 79. This argument raises a number of questions. In the first place, there is the question whether general legislation which limits welfare benefits, resulting in some cases in a reduction in household income, constitutes, by reason of the impact of that reduction in income upon the lives and circumstances of those affected, an interference with their right to respect for their private and family life. If it does, the ambit of article 8 is enlarged beyond current understanding so as to embrace legislation imposing increases in taxation or reductions in social security benefits. Secondly, on the assumption that such legislation falls within the ambit of article 8(1), article 8(2) permits an interference with the right to respect for family life to be justified as being necessary in a democratic society in the interests of the economic well being of the country. The argument that justification on that ground is impossible unless the best interests of the children affected by the measure in question have been treated as a primary consideration not only in the sense that they have been taken into account but, as counsel emphasised, in the sense that the legislation is in reality in the best interests of the children affected by it has major implications for the effect of the ECHR in relation to legislation in the field of taxation and social security. 80. These issues were not addressed in the course of the argument. Most of the European authorities cited in support were concerned with the different question of the eviction of individuals from their homes, which is not an issue arising on the facts of the present cases. The cases indicate that a reduction in income may have consequences which are such as to engage article 8, as for example where non payment of rent leads to the threat of eviction from ones home, but they do not indicate that the reduction in income is itself within the ambit of article 8. The only other European authority cited was the case of Neulinger v Switzerland (2010) 54 EHRR 1087, which was concerned with the return of a child under a child abduction convention. It is unnecessary to say more than that the argument has not been made out. 81. A more closely reasoned argument has been developed in submissions lodged after the hearing, which treats article 3(1) of the UNCRC as forming part of the proportionality assessment under article 14 of the ECHR read with A1P1. In consequence, a test of compliance with article 3(1) is effectively substituted for the manifestly without reasonable foundation test which all parties agree to be applicable in the present context. On that basis, article 3(1) is argued to be decisive of the appeals. It is therefore necessary to consider carefully how, if at all, article 3(1) bears on the issues in these appeals. 82. As an unincorporated international treaty, the UNCRC is not part of the law of the United Kingdom (nor, it is scarcely necessary to add, are the comments upon it of the UN Committee on the Rights of the Child). The spirit, if not the precise language, of article 3(1) has been translated into our law in particular contexts through section 11(2) of the Children Act 2004 and section 55 of the Citizenship, Borders and Immigration Act 2009: ZH (Tanzania) v Secretary of State for the Home Department [2011] UKSC 4; [2011] 2 AC 166, para 23. The present case is not however concerned with such a context. 83. The UNCRC has also been taken into account by the European Court of Human Rights in the interpretation of the ECHR, in accordance with article 31 of the Vienna Convention on the Law of Treaties. As the Grand Chamber stated in Demir v Turkey (2008) 48 EHRR 1272, para 69, the precise obligations that the substantive obligations of the Convention impose on contracting states may be interpreted, first, in the light of relevant international treaties that are applicable in the particular sphere. It is not in dispute that the Convention rights protected in our domestic law by the Human Rights Act can also be interpreted in the light of international treaties, such as the UNCRC, that are applicable in the particular sphere. 84. The approach adopted is illustrated by V v United Kingdom (1999) 30 EHRR 121, where the European court had regard to articles 37 and 40 of the UNCRC when considering how the prohibition of inhuman and degrading treatment in article 3 of the ECHR applied to the trial and sentencing of child offenders, and, in a domestic context, by R (T) v Chief Constable of Greater Manchester Police [2014] UKSC 35; [2015] AC 49, where this court referred to article 40 of the UNCRC when considering whether legislation regulating the disclosure of offences committed by children was compatible with article 8 of the ECHR. 85. The case of X v Austria (2013) 57 EHRR 405, on which the appellants and the interveners principally rely, concerned the proposed adoption of a child by the female partner of the childs biological mother. The effect of adoption under Austrian law was to sever the legal relationship between the child and the biological parent of the same sex as the adoptive parent. In consequence, therefore, Austrian law could not recognise a legal relationship between a child, an adoptive parent, and a biological parent of the same sex as the adoptive parent. An application to the European court was brought by the child, the mother, and her partner, all of whom lived together as a family, on the basis that they had been denied legal recognition of their family life by reason of the sexual orientation of the two adults, in violation of article 14 of the ECHR read together with article 8. The court considered their complaint on the basis that all three applicants enjoyed family life together, and all three were therefore entitled to complain of a violation of their rights. The effect of the Austrian law was to prevent second parent adoption by same sex couples. The justifications advanced were the protection of the family in the traditional sense, and the protection of the interests of children, both of which were legitimate aims. The question was whether the principle of proportionality was adhered to. In considering that question, the court identified a number of considerations which weighed in favour of allowing the courts to carry out an examination of each individual case, rather than imposing an absolute rule. The court added that this would also appear to be more in keeping with the best interests of the child, which was a key notion 86. in the relevant international instruments. In that regard, the court had earlier referred to a number of provisions of the UNCRC, including article 3(1). It is clear, therefore, that the UNCRC can be relevant to questions concerning the rights of children under the ECHR. There are also cases in which, although the court has not referred to the UNCRC, it has taken the best interests of children into account when considering whether an interference with their fathers or mothers right to respect for their family life with the children was justified. An example is the case of ner v Netherlands (2006) 45 EHRR 421, which concerned the deportation of an adult, resulting in his separation from his children. In circumstances of that kind, the proportionality of the interference with family life could not be assessed without consideration of the best interests of the children, a matter which was relevant to respect for his family life with them, as it was also to their right to respect for their family life with him. Indeed, they might themselves have been applicants, on the basis that their own article 8 rights were engaged. 87. The present context, on the other hand, is one of alleged discrimination between men and women in the enjoyment of the property rights guaranteed by A1P1. That is not a context in which the rights of the adults are inseparable from the best interests of their children. It is of course true that legislation limiting the total income which persons can receive from benefits, like any legislation affecting their income, may affect the resources available to them to provide for any children in their care, depending upon how they respond to the cap: something which will vary from one case to another. They may increase their income from other sources, for example by obtaining employment or by obtaining financial support for the upkeep of a child from an absent parent; or they may respond by reducing their expenditure, for example by moving to cheaper accommodation. Depending on how parents respond, the consequences of the cap for their children may vary greatly, and may be regarded as positive in some cases and as negative in others. 88. The questions (1) whether legislation of this nature should be regarded as action concerning children, within the meaning of article 3(1) of the UNCRC, (2) whether that provision requires such legislation to be in the best interests of all the children affected by it, and (3) whether the Regulations fulfil that requirement, appear to me to be questions which, for reasons I shall explain, it is unnecessary for this court to decide. Even on the assumption, however, (1) that article 3(1) of the UNCRC applies to general legislation of this character, (2) that article 3(1) requires such legislation to be in the best interests of all the children indirectly affected by it, and (3) that the legislation in question is not in reality in the best interests of all the children indirectly affected by it, that does not appear to me to provide an answer to the question 89. whether the legislation unjustifiably discriminates between men and women in relation to their enjoyment of the property rights guaranteed by A1P1. It is true that the benefits which are taken into account when deciding whether the cap has been exceeded include benefits payable to parents by reason of their responsibility for the care of children. It is also true that the differential impact of the measure upon men and women arises from the fact that more women than men take on responsibility for the care of their children when they separate. It is argued that it is therefore unrealistic to distinguish between the rights of women under article 14 read with A1P1, and those of their children under the UNCRC. There is nevertheless a clear distinction. In cases where the cap results in a reduction in the resources available to parents to provide for children in their care, the impact of that reduction upon a child living with a single father is the same as the impact on a child living with a single mother in similar circumstances, or for that matter a child living with both parents. The fact that children are statistically more likely to be living with a single mother than with a single father is unrelated to the question whether the childrens rights under article 3(1) of the UNCRC have been violated. There is no factual or legal relationship between the fact that the cap affects more women than men, on the one hand, and the (assumed) failure of the legislation to give primacy to the best interests of children, on the other. The conclusion that the cap is incompatible with the UNCRC rights of the children affected therefore tells one nothing about whether the fact that it affects more women than men is unjustifiable under article 14 of the ECHR read with A1P1. The contrary view focuses on the question whether the impact of the legislation on children can be justified under article 3(1) of the UNCRC, rather than on the question whether the differential impact of the legislation on men and women can be justified under article 14 read with A1P1, and having concluded that the legislation violates article 3(1) of the UNCRC, mistakenly infers that the difference in the impact on men and women cannot therefore be justified. 90. Nor is the argument made stronger by being recast in terms of domestic administrative law, on the basis that the decision to make the Regulations was vitiated by an error of law as to the interpretation of article 3(1) of the UNCRC. It is firmly established that UK courts have no jurisdiction to interpret or apply unincorporated international treaties: see, for example, J H Rayner (Mincing Lane) Ltd v Department of Trade and Industry [1990] 2 AC 418, 499; R v Lyons (Isidore) [2002] UKHL 44; [2003] 1 AC 976, para 27. As was made clear in R (Corner House Research) v Director of the Serious Fraud Office (JUSTICE Intervening) [2008] UKHL 60; [2009] AC 756, it is therefore inappropriate for the courts to purport to decide whether or not the Executive has correctly understood an unincorporated treaty obligation. As Lord Bingham of Cornhill said at para 44: Whether, in the event that there had been a live dispute on the meaning of an unincorporated provision on which there was no judicial authority, the courts would or should have undertaken the task of interpretation from scratch must be at least questionable. It would moreover be unfortunate if decision makers were to be deterred from seeking to give effect to what they understand to be the international obligations of the United Kingdom by fear that their decisions might be held to be vitiated by an incorrect understanding. Lord Brown of Eaton under Heywood expressed himself more emphatically (para 67): It simply cannot be the law that, provided only a public officer asserts that his decision accords with the states international obligations, the courts will entertain a challenge to the decision based upon his arguable misunderstanding of that obligation and then itself decide the point of international law at issue. 91. The case of R v Secretary of State for the Home Department, Ex p Launder [1997] 1 WLR 839, on which reliance is placed, is distinguishable from the present case on the same basis as it was distinguished in the Corner House Research case. In the first place, as Lord Bingham pointed out (para 44), there was in Launder no issue between the parties about the interpretation of the relevant articles of the Convention, whereas in Corner House, as in the present case, the court was being asked to determine, in the absence of any international judicial authority, the meaning of a provision of an unincorporated international treaty. Secondly, as Lord Brown noted (para 66), Launder was a case in which it was plain that the decision maker would have taken a different decision had his understanding of the treaty been different: his clear intention was to act consistently with the United Kingdoms international obligations, whatever decision that would have involved him in taking. In Corner House, on the other hand, the primary intention behind the decision was to save this country from a threat which it faced, and all that the Ministers were really saying was that they believed the decision to be consistent with the international obligation in question. The intensity of review 92. Finally, it has been explained many times that the Human Rights Act entails some adjustment of the respective constitutional roles of the courts, the executive and the legislature, but does not eliminate the differences between them: differences, for example, in relation to their composition, their expertise, their accountability and their legitimacy. It therefore does not alter the fact that certain matters are by their nature more suitable for determination by Government or Parliament than by the courts. In so far as matters of that nature have to be considered by the courts when deciding whether executive action or legislation is compatible with Convention rights, that is something which the courts can and do properly take into account, by giving weight to the determination of those matters by the primary decision maker. 93. That consideration is relevant to these appeals, since the question of proportionality involves controversial issues of social and economic policy, with major implications for public expenditure. The determination of those issues is pre eminently the function of democratically elected institutions. It is therefore necessary for the court to give due weight to the considered assessment made by those institutions. Unless manifestly without reasonable foundation, their assessment should be respected. 94. As I have explained, the Regulations were considered and approved by affirmative resolution of both Houses of Parliament. As Lord Sumption observed in Bank Mellat v H M Treasury (No 2) [2013] UKSC 39; [2014] AC 700, para 44: When a statutory instrument has been reviewed by Parliament, respect for Parliament's constitutional function calls for considerable caution before the courts will hold it to be unlawful on some ground (such as irrationality) which is within the ambit of Parliament's review. This applies with special force to legislative instruments founded on considerations of general policy. 95. Many of the issues discussed in this appeal were considered by Parliament prior to its approving the Regulations. That is a matter to which this court can properly have regard, as has been recognised in such cases as R (Williamson) v Secretary of State for Education and Employment [2005] UKHL 15; [2005] 2 AC 246, R (Hooper) v Secretary of State for Work and Pensions [2005] UKHL 29; [2005] 1 WLR 1681, R (Countryside Alliance) v Attorney General [2007] UKHL 52; [2008] AC 719, and R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] UKHL 15; [2008] AC 1312. Furthermore, that consideration followed detailed consideration of clause 93 of the Bill, which became section 96 of the 2012 Act. It is true that the details of the cap scheme were not contained in the Bill which Parliament was debating, but the Governments proposals had been made clear, they were challenged by means of proposed amendments to the Bill, and they were the subject of full and intense democratic debate. That is an important consideration. As Lord Bingham of Cornhill observed in R (Countryside Alliance) v Attorney General [2007] UKHL 52; [2008] AC 719, para 45: The democratic process is liable to be subverted if, on a question of moral and political judgment, opponents of the Act achieve through the courts what they could not achieve in Parliament. The same is true of questions of economic and political judgment. 96. Giving due weight to the assessment of the Government and Parliament, I am not persuaded that the Regulations are incompatible with article 14. The fact that they affect a greater number of women than men has been shown to have an objective and reasonable justification. No one has been able to suggest an alternative which would have avoided that differential impact without compromising the achievement of the Governments legitimate aims. Put shortly, it was inevitable that measures aimed at limiting public expenditure on welfare benefits, addressing the perception that some of the out of work were receiving benefits which were excessive when compared with the earnings of those in work, and incentivising the out of work to find employment, would have a differential impact on women as compared with men. That followed from the fact that women formed the majority of those who were out of work and receiving high levels of benefit. The Governments considered view, endorsed by Parliament, that the achievement of those aims was sufficiently important to justify the making of the Regulations, notwithstanding their differential impact on men and women, was not manifestly without reasonable foundation. I would accordingly dismiss the appeals. LORD CARNWATH: 97. Others have explained the factual and legal background of these appeals. The following issues were agreed between the parties for consideration by the Supreme Court: (i) Was the Court of Appeal wrong to have declined to decide whether the benefit cap, as formulated in the 2012 Regulations, had an unlawfully disproportionate impact on victims of domestic violence? (ii) Was the Court of Appeal wrong not to have found that the disproportionate effect of the 2012 Regulations on victims of domestic violence was contrary to article 14 ECHR (read with article 8 and/or article 1 of Protocol 1) and unlawful? (iii) Was the Court of Appeal wrong to have found that the discriminatory effects of the 2012 Regulations on lone parents were justified and lawful, and not contrary to article 14 (read with article 8 and/or article 1 of Protocol 1)? (iv) Was the Court of Appeal wrong to have found that the Respondent has complied with his obligation to treat the best interests of children as a primary consideration when implementing the benefit cap scheme? 98. The boundaries between these heads of claim have not been very clearly delineated in the arguments before us. However, in agreement with both Baroness Hale and Lord Reed, I find it most helpful to concentrate on issues (iii) and (iv), with specific regard to article 1 of protocol 1 (A1P1). Like them I do not think that a case has been made, at least on the evidence before us, for separate treatment of the position of victims of domestic violence, the subject of issues (i) and (ii). Under issue (iii) it is common ground that the scheme falls within the ambit of A1P1, and that in the context of article 14 it is indirectly discriminatory against women, particularly lone parents. The only issue therefore is justification. 99. Article 8 was also mentioned under issue (iii), and was relied on by Mr Wise in his printed case. However, as I understood it, this was not by way of challenge to the Court of Appeals rejection of the free standing claim under article 8, which is consequently not one of the agreed issues for this court. Rather he relied on article 8 either as an alternative route into article 14, or as supporting his best interest claim under issue (iv). I note that article 8 was not relied on by Mr Drabble QC for the Child Poverty Action Group. I have not been persuaded that either of Mr Wises formulations adds anything of substance to the claim based on A1P1. 100. It is important also to understand how the interests of children affected by the scheme may be relevant to the legal analysis, either under the Convention itself, or indirectly by reference to article 3(1) of the UNCRC (best interests of children as a primary consideration). As to the Convention, the children have no relevant possessions under A1P1 in their own right; nor are they a protected class under article 14. However, as Lady Hale has said (para 218), the disproportionate impact on women arises because they are responsible for the care of dependent children. Elias LJ said in the Divisional Court (para 62): In this case there is no dispute that the rights of the adult claimants under A1P1 (the right to peaceful enjoyment of possessions) are affected by a reduction in the benefits paid to them. And although the child claimants have no A1P1 rights themselves, we agree with CPAG's submission that it would be artificial to treat them as strangers to the article 14/A1P1 arguments. The benefits in each case are paid to the mother to enable her both to feed and house herself and to feed and house her children. I agree. Accordingly, in considering the nature of the admittedly discriminatory effect of the scheme on lone parents, and its alleged justification, the effects on their children must also be taken into account. 101. The possible relevance of UNCRC article 3(1) requires a little more explanation. Before the Divisional Court (para 45) Mr Eadie QC was recorded as having submitted on behalf of the Secretary of State that, as an international instrument with no binding effect in English law, the Convention had no bearing on the case. This argument was rejected by Elias LJ and has not been renewed. The Court of Appeal said: 69. The Divisional Court held that, notwithstanding the fact that the UNCRC is an international convention which has not been incorporated into our domestic law, the court should nevertheless have regard to it as a matter of Convention jurisprudence: see Neulinger v Switzerland (2010) 28 BHRC 706, cited by Baroness Hale in ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166 at para 21. This has not been challenged by the Secretary of State on this appeal. (para 69) Whether or not for this reason, issue (iv) was agreed by the Secretary of State in a form which raised directly the issue of compliance with article 3(1), without overtly questioning its legal relevance, or advancing any substantive argument on that issue. In the circumstances it seemed right to proceed on the basis, conceded rather than decided, that the obligations imposed by article 3(1) were matters to be taken into account under the Convention on Human Rights. As will be seen, this has now emerged as a crucial issue following the post hearing exchanges. However, before returning to it in that context, I will consider the treatment of the discrimination issues, and in particular article 3(1), in the courts below. 102. It is unnecessary to repeat the accounts given in other judgments of the nature of the discrimination, of the three fold justification put forward by the Secretary of State, and of the criticisms made of it by the appellants, supported by the interveners. In short, it is said, the two objectives of fairness and increasing incentives to work are largely irrelevant or misconceived in their application to the group which is the object of discrimination; and that the third, saving money, cannot on its own justify discriminatory treatment in the enjoyment of a convention right. The essential objection was put shortly by Mr Drabble for the Child Poverty Action Group: Although this is not the expressed aim of the cap, its discriminatory effect is built in to its structure. Lone parent families are more likely to be affected by the cap precisely because it is so difficult for them to move into work; and the effects of the cap on them will necessarily be much harsher the corollary is that a lone parent will be far less likely to be able to avoid the cap by moving into work (a point accepted by the Government). The effects of the cap on a single mother and her children will be more severe the more children she has to clothe, feed and house, and she must do so alone. 103. The Court of Appeal, in agreement with the Divisional Court, rejected these criticisms, holding in particular that there had been compliance with article 3(1) (para 72ff). Applying the approach of members of this court in H (H) v Italian Prosecutor [2013] 1AC 338, they held that it was not necessary for the decision maker to adopt a tightly structured approach to consideration of the issues raised by article 3(1). It was enough for him to give appropriate weight to the interests of children as a primary consideration in the overall balancing exercise. 104. They found ample evidence that the Secretary of State had satisfied this test, citing five matters (para 74): (i) The 2010 Treasury Spending Review made clear that a principal objective was to raise children out of long term poverty; (ii) The February 2011 Impact Assessment showed that the government was keenly aware of the likely impact on children; (iii) The March 2011 Equality Impact Assessment stressed the objective of reversing the detrimental impact on families and children of benefits dependency, and indicated that the government was looking at ways to ease the transition for large families; (iv) The Parliamentary debates focussed time and again on the interests of children; and (v) The July 2012 Impact Assessment revised the assessment of the number of children likely to be affected and addressed the issue of short term relief. These points have been in substance adopted in the submissions of the Secretary of State in this court. 105. The comments in this court in H (H) predated, and therefore did not take account of, the most authoritative guidance now available on the effect of article 3(1). This is in General Comment No 14, adopted by the UN Committee on the Rights of the Child early in 2013. Although this guidance was not available at the time of the decisions under challenge, it is as I understand it intended as a restatement of established practice, rather than a new departure. 106. Paragraph 6 explains that best interests in this context is a three fold concept: (a) a substantive right, (b) a fundamental, interpretative legal principle, and (c) a rule of procedure. The first and third are explained as follows: (a) A substantive right: The right of the child to have his or her best interests assessed and taken as a primary consideration when different interests are being considered in order to reach a decision on the issue at stake, and the guarantee that this right will be implemented whenever a decision is to be made concerning a child, a group of identified or unidentified children or children in general. Article 3, paragraph 1, creates an intrinsic obligation for States, is directly applicable (self executing) and can be invoked before a court. (c) A rule of procedure: Whenever a decision is to be made that will affect a specific child, an identified group of children or children in general, the decision making process must include an evaluation of the possible impact (positive or negative) of the decision on the child or children concerned. Assessing and determining the best interests of the child require procedural guarantees. Furthermore, the justification of a decision must show that the right has been explicitly taken into account. In this regard, States parties shall explain how the right has been respected in the decision, that is, what has been considered to be in the childs best interests; what criteria it is based on; and how the childs interests have been weighed against other considerations, be they broad issues of policy or individual cases. (emphasis added) 107. Later paragraphs explain that the phrase actions concerning children is to be read in a very broad sense covering actions including children and other population groups, such as those relating to housing (para 19); that where a decision will have a major impact on children a greater level of protection and detailed procedures to consider their best interests (are) appropriate (para 20); and that the childs interests have high priority and (are) not just one of several considerations larger weight must be attached to what serves the child best (para 39). 108. In relying on this guidance, Mr Wise accepted that it was not necessary for the decision maker to address the issues in a particular structured order, as the Court of Appeal may have understood his argument. What matters is the substance of what is done rather than the form. However those passages do show in my view that the evaluation needs to consider, where relevant, the interests both of children in general and of those directly affected by the action. It also needs to indicate the criteria by which the high priority given to childrens interests has been weighed against other considerations. In so far as that evaluation shows conflict with the best interests of the children affected, it needs either to demonstrate how that conflict will be addressed, or alternatively what other considerations of equal or greater priority justify overriding those interests. 109. Accordingly, as the submissions and evidence stood at the end of the hearing, my view was that, judged by those criteria, the matters relied on by the Court of Appeal fell well short of establishing compliance. The Treasurys long term objective of taking children out of poverty, laudable in itself, was no substitute for an evaluation of the particular impact on the children immediately and directly concerned, and their parents. The February 2011 Impact Assessment and the March 2011 Equality Impact Assessment may have shown that the government was keenly aware of the likely impact on children, and was looking at ways to ease the transition, but they did not provide the answers. In any event, those assessments were related to the statute rather than the regulations which are now under challenge. 110. Those assessments also predated the report by the Childrens Commissioner in January 2012, which set out a number of likely outcomes of concern to the Commissioner. They included increase in child poverty (including diversion to housing costs of money which would otherwise have been spent on necessities for childrens health and wellbeing), children losing their homes, incentivising family breakdown, and disproportionate impact on children from some BME groups. The Commissioner expressed the view that the universal imposition of the cap without regard to the individual circumstances of children would conflict with the best interests principle under UNCRC article 3(1). This view had special significance, as that of the authority responsible under the Children Act 2004 for advising the Secretary of State on the interests of children. 111. The subsequent Equality Impact Assessment of July 2012, prepared by the Department in support of the regulations, did indeed make some revisions to the earlier figures, and mentioned the short term relief to be provided by discretionary housing payments. But it did not in terms respond to the more fundamental points of concern raised by the Commissioners report. In his evidence for the Secretary of State, Mr Holmes observed simply that the government did not agree with the Commissioners assessment, but without further detail. The July assessment also indicated that there would in due course be a full evaluation of the operation of the benefit cap, to be published in autumn 2014. (We have not been given any information relating to this exercise, nor has it been suggested that it is relevant to our consideration of the legal issues relating to the decisions under challenge.) 112. For these reasons, my provisional view at the end of the hearing was that, in their application to lone parents and their dependent children, the regulations were not compatible with Convention rights, and that the court should so declare. Post hearing submissions 113. In post hearing submissions permitted by the court, the point was taken on behalf of the Secretary of State that A1P1 (with or without article 14) was not the context in which article 3(1) UNCRC had hitherto been relied on by the appellants. I observe that this limitation is not apparent from the agreed wording of question (iv). Nor it seems was the discussion in the courts below so limited. Lord Dysons reference to this argument (paras 67 75), and to its treatment by the Divisional Court, came immediately after his discussion of article 14 (read with A1P1); he observed that the argument had featured prominently in Mr Wises submissions on justification in relation to article 14 (as well as in relation to article 8 which we deal with below. It is fair to say however that at the hearing Mr Wises submissions in that connection were directed mainly to article 8. For this reason, and because of the importance of the issue for this case and others, counsel for the Secretary of State were given the opportunity to make further written submissions. 114. They summarised their submissions in the following six points: (i) Article 3(1) of the UNCRC is a provision of an unincorporated treaty which may only be relied on to the extent that it has been transposed into domestic law; (ii) The ECtHR uses international law when determining the meaning of provisions of the ECHR, in accordance with the Vienna Convention on the Interpretation of Treaties; (iii) Article 3(1) of the UNCRC is, as a matter of principle and in accordance with Strasbourg authority, not relevant to the question of justification of discrimination under article 14 read with A1P1. It has no role to play in determining the meaning of article 14 (read with A1P1 or otherwise), and does not inform or illuminate the question whether the differential impact on women of the benefit cap is proportionate; (iv) Article 3(1) of the UNCRC does not supplant, dilute or compromise the Stec test which all parties have agreed, at every stage of these proceedings, applies both when considering whether the aims are legitimate and when determining whether the 2012 Regulations, having regard to their differential impact on women, are proportionate; (v) Even if the Court were to consider it foreseeable that the ECtHR may develop its case law to have the effect that a breach of article 3(1) of the UNCRC renders legislation disproportionate, there are strong constitutional reasons why the Court should refrain from going beyond the current Strasbourg jurisprudence; and (vi) In any event, the 2012 Regulations do not breach article 3(1) of the UNCRC. The Secretary of State fully took into account the best interests of children, as a primary consideration, and these were extensively debated in Parliament. 115. I have little difficulty with points (i), (ii), (iv) and (v). There has been no dispute as to the application of the Stec test to the issue of proportionality (iv), and no one has argued that we should go beyond existing ECHR jurisprudence (v). As to (i) it is of course trite law that, in this country at least, an international treaty has no direct effect unless and until incorporated by statute, but that it may be taken into account as an aid to interpretation in cases of ambiguity. To that extent the present case is to be contrasted with cases such as ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166, in which as Lady Hale explained (para 23), UNCRC article 3(1) was reflected in the relevant statutory provisions. Ministerial statements of the governments commitment to giving due consideration to the UNCRC articles (see Lady Hale para 214), may have political consequences but are no substitute for statutory incorporation. 116. It is equally clear (ii) that, under the ECHR and in accordance with the Vienna Convention, regard may be had to principles of international law, including international conventions, for the purpose of interpreting the terms and notions in the text of the Convention: see Demir v Turkey (2008) 48 EHRR 1272, paras 65, 67, 85. Demir itself is a good illustration of that proposition. For the purpose of determining whether article 11 (right to join a trade union) extended to civil servants, reference was made to article 22 of the International Covenant on Civil and Political Rights. It was noted by the court (para 99) that the wording of that article was similar to that of article 11 of the Convention, but that it was expressed to be subject to the right of the state to exclude the armed forces and the police, without referring to members of the administration of the state. Similarly, in Neulinger v Switzerland, to which Elias LJ referred, the court had regard to the Hague Convention on the Civil Aspects of International Child Abduction in determining whether forced return of a child to Israel would involve a breach of his rights under article 8 of the Convention. Point (iii) international treaties and article 14 117. Point (iii) questions the application of this approach in the context of article 14 taken with A1P1, and more specifically to the issue of justification. There seems to be no reason in principle why the Demir approach should not apply to article 14. Mr Drabble relies on X v Austria (2013) 57 EHRR 405, as the clearest example, in that case relating to article 14 taken with article 8. The court held that a law preventing second parent adoption in the case of same sex marriages involved discrimination under 14, and, although the law served a legitimate aim, it had not been shown that an absolute prohibition was necessary for the protection of the families or children. Early in its judgment (para 49) the court had quoted UNCRC article 3, and also article 21 which requires that systems of adoption shall ensure that the best interests of the child shall be the paramount consideration. In considering the question of justification, the court listed the factors which seemed rather to weigh in favour of allowing the courts to carry out an examination of each individual case adding (with a reference to the earlier quotations): This would appear to be more in keeping with the best interests of the child, which is a key notion in the relevant international instruments (para 146) Of this case Mr Sheldon QC for the Secretary of State commented: the court carried out the proportionality exercise (in respect of article 14 read with article 8) in the usual way and only subsequently observed that the outcome would also appear to be more in keeping with the best interests of the child. That is not the same as using the UNCRC for the purposes of carrying out the balancing exercise itself. Still less does it involve using the UNCRC to alter the proportionality test. If that was intended to suggest that the reference to the UNCRC was purely incidental to the courts reasoning, I cannot agree. The prominence given to the relevant articles in the earlier exposition of the relevant law shows to my mind that it was treated as a significant part of the consideration of article 14, albeit in a very different factual context to the present case. 118. Another Strasbourg case in which reliance was placed on the UNCRC as an aid to interpretation of the Convention, in this case in favour of the state, was Ponomaryov v Bulgaria (2011) 59 EHRR 799. The complaint was of a violation of article 14 taken with A2/P1 (right to education), by direct discrimination on the grounds of nationality with respect to the provision of secondary education. In dismissing the application, the court relied on UNCRC article 28 as supporting the view that the state enjoyed a greater margin of appreciation in relation to secondary as compared to primary education (para 57). 119. There are examples also in domestic jurisprudence. Lady Hale has referred to the judgment of Maurice Kay LJ in Burnip v Birmingham City Council [2013] PTSR 117, concerning discrimination in the application of housing benefit for a disabled person. Although the court was able to arrive at its decision on other grounds, Maurice Kay LJ would have relied if necessary on the UN Convention on the Rights of Persons with Disabilities (CRPD) to resolve any uncertainty over the meaning of article 14 discrimination in the circumstances of the case (para 22). Of this case Mr Sheldon comments: Even if that was a correct approach, it does not justify using a treaty involving one group (here, children) to resolve any uncertainty about a claim for discrimination brought by, and in respect of, an entirely different group (here, women). I see no reason to question Maurice Kay LJs approach as applied to the case before him, which seems wholly consistent with the ECHR cases already cited. I accept however that the treaty in question was directly related to the particular form of discrimination there in issue. I will return to that point. 120. I see no inconsistency between such reference to international treaties where relevant and the Stec test. In Burnip. Henderson J, giving the lead judgment, cited the passage in Stec which established the manifestly without reasonable foundation test as appropriate for review of general measures of economic or social strategy, and declined to adopt an enhanced test requiring very weighty reasons for the discrimination. It was in this context that Maurice Kay LJ, who agreed with Henderson J on the issue of justification (para 23), drew assistance from the CRPD. 121. Before considering the application of that approach to the present case, it is convenient to consider point (vi), that is whether the latest submissions throw any further light on the issue whether the regulations were in compliance with article 3(1). Compliance with article 3(1) 122. It is not in dispute that, as asserted, issues in relation to the interests of children were extensively debated in Parliament or that the views so expressed were taken into account by Ministers. But article 3(1) is more than a restatement of the ordinary administrative law duty to have regard to material circumstances. The principles were summarised by Lord Hodge in Zoumbas v Secretary of State for the Home Department (AF (A Child) intervening) [2013] 1 WLR 3690 (paras 10 13) in seven points. I would emphasise the first and last: (1) The best interests of a child are an integral part of the proportionality assessment under article 8 ECHR ; (7) A child must not be blamed for matters for which he or she is not responsible, such as the conduct of a parent. On the other hand, as he added (by reference to H (H)) there may be circumstances in which the weight of another primary consideration can tip the balance and make the interference proportionate even where it has very severe consequences for children (para 13). 123. In considering how the government approached that task, rather than trawling through the parliamentary debates, we are entitled to rely on the evidence given in these proceedings on behalf of the Secretary of State. The Court of Appeal quoted (paras 32 33) the evidence of Mr Holmes that: if the level of the benefit cap was based on the number of children in a household it would undermine the intention that there should be a clear upper limit to the amount of benefit families can receive. and Agreeing to exclude child benefit from the cap would have effectively resulted in there being no limit to the amount of benefit a household could receive. Further, Child Benefit, like other welfare benefits, is provided by the state and funded by taxpayers and therefore with the aim of reducing welfare expenditure and reducing the deficit the Government believes it is right that it is taken into account along with other state benefits when applying the cap. It is noteworthy that, as far as Mr Holmes evidence went, the Secretary of State offered no substantive response to the specific concerns expressed by the Childrens Commissioner and others about the practical impact on children of families affected by the cap. Of the two points made by him, the second is no more than a general statement of the desirability of limiting government expenditure, without any direct reference to the interests of children. The first point the need for a clear upper limit begs the question whether it is consistent with the statutory framework to treat child benefits as no more than a component of the family income. 124. The difficulty with that response, in the context of a duty to treat the best interests of the child as a primary consideration is that it ignores the distinctive statutory purpose of the child related benefits. Lord Reed (para 35) refers to a ministerial response in the course of the Parliamentary debate, to the effect that working people on low incomes had to cope with difficult circumstances and live within their means; that their earnings were not determined by the size of their families, and that the government believed that the same principle should apply to the level of the cap. 125. As applied to child related benefits, in my view, this was a false comparison. No doubt for that reason it was not a point made by Mr Holmes. The benefits are paid regardless of whether their parents are in work or not. In this respect therefore workers and non workers alike were (before the cap) able to rely on this extra assistance in coping with difficult circumstances in the interests of their children. Although paid to the parents, these benefits are designed to meet the needs of children considered as individuals. As Lady Hale said in Humphreys v Revenue and Customs Comrs (summarising the case for the Revenue): The aim of child tax credit is to provide support for children. The principal policy objective is to target that support so as to reduce child poverty. The benefit attaches to the child rather than the parent. ([2012] 1 WLR 1545 para 25) The same could be said of child benefit. 126. As Mr Drabble QC submitted, the cap was a complete innovation in the combined benefits/tax system, which had always contained a mechanism to adjust for family size. The cap has the effect that for the first time some children will lose these benefits, for reasons which have nothing to do with their own needs, but are related solely to the circumstances of their parents. It is difficult to see how this result can be said to be consistent with the best interests of the children concerned, or in particular with the first and seventh principles in Zoumbas. 127. Lord Reed has referred to statements made to Parliament in November 2011 that excluding both child benefit and child tax credit would reduce the savings from the scheme by 80 90%, and so emasculate the scheme. It is not clear whether these are up to date estimates, or how they relate to the regulations as opposed to the Bill. If correct, they raise the questions why the viability of a scheme, whose avowed purpose is directed at the parents not their children, is so disproportionately dependent on child related benefits. There is nothing in Mr Holmes evidence which addresses or answers these questions. 128. Accordingly I remain of the view that the Secretary of State has failed to show how the regulations are compatible with his obligation to treat the best interests of children as a primary consideration. UNCRC article 3(1) and A1P1 129. The more difficult question, now that it has been put in issue, is how that finding in relation to the interests of children under UNCRC article 3(1) affects the resolution of issue (iii): that is the alleged justification for the admittedly discriminatory effects on women as lone parents. As Mr Sheldon submits, even if article 3(1) had a role to play in illuminating article 14, this could only be where the alleged indirect discrimination, or differential treatment, was in respect of children. In the present case, by contrast, the allegation is of discrimination, not against children, but against their mothers. The children, it is said, will be treated the same whether their lone parents are male or female. With considerable reluctance, on this issue agreeing with Lord Reed, I feel driven to the conclusion that he is right. 130. In all the article 14 cases to which we have been referred to in this context there was a direct link between the international treaty relied on and the particular discrimination alleged: (i) In X v Austria (2013) 57 EHRR 405, where the complaint concerned discrimination by restrictions on adoption by single sex couples, the court referred not only to UNCRC article 3(1), but also to article 21 which applied the best interests principle specifically to adoption. In Ponomaryov v Bulgaria (2011) 59 EHRR 799, where the complaint was of discrimination in respect of education, reference was made to UNCRC article 28 relating also to education. (ii) (iii) In Burnip v Birmingham City Council [2013] PTSR 117, where the alleged discrimination related to the treatment of the disabled, reference was made to the CRPD, covering the same subject matter. In each of these cases, it can plausibly be argued that the court was using the international materials to fill out, or reinforce, the content of a Convention article dealing with the same subject matter. They can be justified broadly as exercises in interpretation of terms and notions in the Convention, consistently with the Demir principle. 131. There is no such connection in the present case. The discrimination with which we are concerned under article 14 is in relation to women and their possessions. Those concepts require no relevant illumination by way of interpretation. It is true that the discrimination in this case is related to their responsibilities as lone parents, and to that extent, as Elias LJ accepted, the children are not strangers to the article 14/A1P1 arguments. But that is a comment on the facts, not on the interpretation of the convention rights. Indeed, as has been seen, it is the distinct interest of the children in the benefits as individuals that has reinforced my view of the breach under article 3(1). As Lord Reed says (para 89) the fact that children are statistically more likely to be living with a single mother than with a single father is unrelated to the question whether the childrens interests have been treated as a primary consideration as required by UNCRC article 3(1). 132. We have been shown no precedent in the Strasbourg jurisprudence for the use of an international treaty in this indirect way. Mr Sheldon argues that there are strong constitutional reasons why the court should not go beyond Strasbourg on an issue of this kind. Whether or not that is so, we have heard no argument that we should do so. The appellants and their supporters have relied simply on the principles to be extracted from the existing case law. Conclusion 133. In conclusion I would dismiss the appeal, albeit on grounds much narrower than those accepted by the courts below. I would hope that in the course of their review of the scheme, the government will address the implications of these findings in relation to article 3(1) itself. However, it is in the political, rather than the legal arena, that the consequences of that must be played out. LORD HUGHES: 134. I agree with the judgment and conclusions of Lord Reed and would like him dismiss this appeal. I add only some additional observations in view of the difference of opinion which is disclosed by the judgments of Lady Hale and Lord Kerr. 135. There is much common ground. (i) The suggested discriminatory effect upon the victims of domestic violence adds nothing to the accepted discriminatory effect upon women. Moreover neither of the adult appellants is suffering any of the adverse effects of the cap relied upon as affecting such victims, so that the Court of Appeal was fully justified in declining to decide the issue of such victims. Further, the principal adverse effects peculiar to such victims which were relied upon (the treatment of refuges and the possible need for two sets of rent to be within housing benefit) have both been addressed by amendments to the original form of the Regulations. It is agreed on all sides that the scheme has legitimate aims. At the very least, the principal aim of discouraging benefit dependence and encouraging work is agreed to be legitimate. For my part I agree that at a time of national economic crisis it was also legitimate to seek to reduce the overall expense on benefits, and that establishing a different balance between those who worked and paid taxes and those who did not was a further legitimate aim. (ii) (iii) A1P1 to the First Protocol is agreed to be engaged to the extent that Stec v United Kingdom (2006) 43 EHRR 1017 establishes that, although it does not give an entitlement to benefits, the ECHR does require that if they are provided they must be administered in a manner which is not discriminatory contrary to article 14. Here a discriminatory effect of the regulations upon women is conceded, because they represent much the largest proportion of lone parents forming a household with children. Accordingly the scheme as a whole, including its discriminatory effect, must be justified. The test, in a case involving high level social/economic policy, is agreed by all parties to be that laid down in Stec, namely that it fails to be justified if it is manifestly without reasonable foundation. 136. The difference of opinion reduces itself to the place of article 3 of the UN Convention on the Rights of the Child (UNCRC). That in turn involves two questions: (a) does article 3 have legal effect in English law and if so by what (b) route? and if it does, has there been a breach of it such as to render the Regulations unlawful? The legal relevance of article 3 UNCRC 137. Article 3 UNCRC is contained in an international treaty ratified by the UK. It is binding on this country in international law. It is not, however, part of English law. Such a treaty may be relevant in English law in at least three ways. First, if the construction (ie meaning) of UK legislation is in doubt, the court may conclude that it should be construed, if otherwise possible, on the footing that this country meant to honour its international obligations. Second, international treaty obligations may guide the development of the common law. For these two propositions see for example R v Lyons (Isidore) [2002] UKHL 44; [2003] 1 AC 976, para 13. Neither has any application to this case. This case is concerned with legislation, not with the common law, and it is not suggested that there is any room for doubt about the meaning of the regulations. Thirdly, however, the UNCRC may be relevant in English law to the extent that it falls to the court to apply the European Convention on Human Rights (ECHR) via the Human Rights Act 1998. The European Court of Human Rights has sometimes accepted that the Convention should be interpreted, in appropriate cases, in the light of generally accepted international law in the same field, including multi lateral treaties such as the UNCRC. An example is Demir v Turkey (2008) 48 EHRR 1272 which concerned the scope of article 11 (right of freedom of association), and which is cited by Lord Reed at para 83 above. 138. It was on this third basis that the UNCRC was advanced in argument before this court and, as I understand it, in the courts below. Until post hearing submissions in this court, this argument was confined to praying in aid article 3 UNCRC upon the application or content of article 8 of the ECHR (respect for private and family life). In turn, the complaint of infringement of article 8 was based upon the rights of the children affected by the cap, not of their mothers except to the extent that they were, as carers, directly involved in the article 8 rights of their children. Article 3 UNCRC was not, until the post hearing submissions, advanced as relevant to the justification of the admitted indirect discrimination against women in relation to their A1P1 rights. 139. For the reasons set out by the Court of Appeal, the article 8 rights of children are not arguably infringed by the benefit cap scheme. Elastic as that article has undoubtedly proved, it does not extend to requiring the State to provide benefits, still less benefits calculated simply according to need, nor does it require the state to provide a home. See Chapman v United Kingdom (2001) 33 EHRR 399, para 99; R (TG) v Lambeth London Borough Council (Shelter intervening) [2012] PTSR 364, paras 34 and 40; AM v Secretary of State for Work and Pensions [2014] EWCA Civ 286, para 22 and the cases there cited. Winterstein v France [2013] ECHR 984 depended upon the long toleration of itinerants on the land from which they were evicted and the absence of provision of alternative accommodation, and does not lead to a different conclusion. Moreover, the likely impact of this scheme upon some children who are members of larger families living in high rent homes is at most to make it unavoidable for the family to move; the duty of Local Authorities to provide accommodation under the Housing Act 1996, Part 7, remains. None of the judgments suggests that article 8 is engaged. I agree that it is not. It follows that article 3 UNCRC cannot have effect in English law on the grounds that it is relevant to its interpretation. 140. The additional argument now formulated before this court and accepted by Lady Hale and Lord Kerr would give article 3 UNCRC the force of domestic English law on the grounds that it bears on the issue of whether the agreed discrimination against women in relation to their A1P1 rights was justified. Lord Kerr would additionally give article 3 direct effect on the grounds that the UKs signature to the convention is sufficient to impose a domestic duty to comply with it. Like Lord Reed and Lord Carnwath, I am unable to accept these arguments. 141. It may not be difficult to see that in interpreting the content of the article 8 rights of children, it may be legitimate to take into account the international obligation contained in article 3 UNCRC. ZH (Tanzania) v Secretary of State for the Home Department [2011] UKSC 4; [2011] 2 AC 166 was an article 8 case where the relevance to that article of the interests of the children of a potential deportee was conceded. Similarly, Neulinger v Switzerland (2010) 54 EHRR 1087 depended upon article 8. It concerned an order directly about the upbringing of a child, namely an order for return to another state pursuant to the Hague Convention on the Civil Aspects of Child Abduction, and the very first words of that convention declare the interests of children to be of paramount importance in matters relating to their custody. If article 8 rights are engaged, the question will often become: is such impairment of respect for private and family life nevertheless permissible under article 8(2)? If the article 8 rights relied upon are those of children, as was asserted here, or of their parents in the form of their relationship with their children, as in ZH (Tanzania), there is scope for the argument that an internationally recognised duty to approach the childrens interests in a particular way bears on whether article 8(2) is satisfied in the context of these regulations whether any impairment of childrens article 8 rights was permitted on the grounds that it is necessary in a democratic society in the interests of the economic well being of the country or the protection of the rights and freedoms of others, such as those taxpayers who do not claim benefits. 142. The Demir approach is not of course limited to article 8, as that case itself shows. And it may extend to cases where discrimination is in issue. Opuz v Turkey (2009) 50 EHRR 695 was an article 2/article 14 case involving a complaint of failure to protect from domestic violence. The court relied in part on the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) in determining the scope of article 14: see paras 185 187. Ponomaryov v Bulgaria (2011) 59 EHRR 799 was a complaint of discrimination against foreign nationals by charging for education when Bulgarian nationals received free provision. Obiter, the court referred at paras 56 57 to international conventions which indicated that the states margin of appreciation increased as one moved from primary, through secondary, to tertiary education. Burnip v Birmingham City Council [2013] PTSR 117 was a benefits case involving A1P1 and a derivative article 14 claim. In the Court of Appeal Maurice Kay LJ would have been prepared to adopt a similar approach by gaining assistance on the scope of article 14 from the UN Convention on the Rights of Persons with Disabilities (CRPD) if the extent of article 14 had been in doubt. Obiter, he also offered the opinion that CRPD might illuminate the approach to justification, but the occasion to test this did not arise. But before the Demir approach to the interpretation of the ECHR can be relevant, there has to be the necessary connection between the international law invoked and the Convention right under consideration. This was clearly present in each of Opuz, Ponomaryov and Burnip. In each, the international instruments referred to were directly concerned with the particular form of discrimination in issue. Demir does not mean that the UNCRC (in this case) becomes relevant to every ECHR question which arises, simply because children are as a matter of fact affected by the decision or legal framework under consideration. 143. It is said that the Strasbourg court has invoked article 3(1) UNCRC in the context of a discrimination claim in X v Austria (2013) 57 EHRR 405. That was a case in which the same sex partner of a childs mother wished to adopt the child, who lived with the two ladies. The effect of Austrian law was that adoption substituted the adoptive parent for the natural parent of the same sex. Thus second parent adoption (adoption by the partner of the natural parent) by a same sex partner was legally ineffective, since if the adoption order were made the same sex partner of the mother would achieve parental rights, but in place of the natural mother, leaving the legal relationship of the absent father to the child unaltered. Conversely, second parent adoption by the different sex partner of the natural parent was effective. The claimants in that case were scrupulous in limiting their complaint about Austrian law to the resultant difference of treatment between, on the one hand, a different sex unmarried couple and, on the other, a same sex unmarried couple such as themselves. They disclaimed any complaint about any different treatment as between married couples and unmarried couples, which the court had previously found to be within the margin of state appreciation: see Gas & Dubois v France [2014] 59 EHRR 22. 144. The court decided the case on the grounds advanced by the claimants. The discrimination between different sex couples and same sex couples was based upon sexual orientation alone. Where such discrimination is in question, the margin of appreciation is narrow and proportionality requires not merely that the measure in question pursues a legitimate aim but also that it is necessary: see paras 140 141. The relevant Convention rights to which the derivative article 14 claim to discrimination was attached were the article 8 rights of all three people, the mother, her partner and the child. In the absence of any evidence submitted to suggest that a child was generally better brought up by a different sex couple than by a same sex couple, there was no justification for the different treatment as between such couples. The court adopted its usual practice of setting out international instruments in the field, and thus included article 3(1) UNCRC. The decision in question (adoption) related directly to the upbringing of the child. It is unsurprising that the court referred (somewhat in passing) at para 146 to the fact that its conclusion was also more in keeping with the best interests of the child, which it noted to be a key notion in the relevant international instruments. It might have added that in the great majority of developed states there is consensus that questions of a childs upbringing must be determined by his or her best interests or welfare as the dominant or paramount consideration: in England this principle is long established law and now encapsulated in section 1(1) of the Children Act 1989. 145. At its highest, this decision is another in which the UNCRC is referred to as relevant to the content of article 8 rights, and thus to the issue of justification for discrimination in relation to such rights. That is a very long way from saying that article 3(1) is relevant to justification upon any kind of discrimination issue, whether or not the decision is about the childs upbringing, and whether or not either the ECHR rights of the child or article 8 rights of his family are at stake. Such issues simply did not arise in X v Austria. 146. If the rights in question are the A1P1 property rights of women, and their associated derivative right not to be discriminated against in relation to those rights, it is an impermissible step further to say that there is any interpretation of those rights which article 3 UNCRC can inform. In the case of article 8, the childrens interests are part of the substantive right of the parent which is protected, namely respect for her family life. In the case of A1P1 coupled with article 14, the childrens interests may well be affected (as here), but they are not part of the womans substantive right which is protected, namely the right to be free from discrimination in relation to her property. There is no question of interpreting that article 14 right by reference to the childrens interests. The protected right to respect for family life under article 8 is entirely different from the protected right to property under A1P1. Nor can the article 8 rights of the child be said to be in need of interpretation when it is clear for the reasons given in all the judgments that they are not infringed. The necessary connection between the ECHR right under consideration and the international instrument is not present. That can be seen by considering the position of the appropriate comparator, namely a lone non working father with the same children and household outgoings. The interests of the children would be exactly the same in his case, but he would have no article 14 claim to discrimination. 147. I also agree that to treat failure to comply with article 3(1) UNCRC as determinative of the present case would be tantamount to departing from the Stec test for justification which has been agreed on all sides throughout this litigation. Was there a breach of article 3 UNCRC? 148. It is unnecessary to decide this question, but I ought to say that in my view it is clear that there was in any event no breach of article 3. 149. The language of article 3(1) does give rise to some difficulty. It is in these terms: In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration. This departs from the formulation of the paramountcy principle for decisions about the upbringing of a child, or for legislation designed for the protection/advancement of children, mentioned at para 142 above. This paramountcy formulation is employed in the UNCRC but only in relation to one kind of upbringing decision, namely adoption (article 21). The different language of article 3(1) begs two important questions: (a) what is the extent of the expression actions concerning children; and (b) what is the meaning of a primary consideration 150. It might be thought that article 3 was intended to apply to decisions directly about a child, or perhaps to those and to others directly affecting him, such as for example decisions relating to the provision of education or child support facilities, and that a primary consideration therefore imports some priority for the best interests of children even if short of making them determinative, as the paramountcy principle does. That might perhaps be suggested by article 3(3) which clearly is specific to the care and protection of children, while article 3(2), which requires states to take appropriate legislative and administrative measures to ensure that the child has such protection and care as is necessary for his well being, is also perfectly consistent with this. This is not, however, the view taken in General Comment 14, adopted by the UN Committee on the Rights of the Child at its 2013 session, referred to by Lord Carnwath at para 105, and foreshadowed by earlier similar documents. 151. That Comment suggests (at para 19) that article 3 extends well beyond decisions directly about children to those which indirectly affect either individual children or children in general, eg related to the environment, housing or transport. If the meaning of article 3(1) is as broad as this, then all manner of court decisions may fall within it; a planning decision relating to housing development might be one, whilst the making of a possession order against a tenant who has children, or the enforcement of money judgments against the family motor car, or the sentencing of him for a serious criminal offence might be others. 152. Pace Lord Carnwath, I do not take it as read that the Committees views, although entitled to careful consideration coming from the source that they do, can be regarded as binding upon party States as to the meaning of the treaty to which they agreed. But it is neither necessary nor appropriate to attempt to resolve these issues in this case, especially since we heard no argument upon them. All that needs to be said is that it is clear that the wider the reach of the concept of decisions concerning either an individual child or children in general, the less possible it is to impose the best interests of such child or children as a determinative or even priority factor over the frequently complex legal or socio economic considerations which govern such decisions. The committees general comment gives some acknowledgement to this problem in, for example, para 20, which recognises that although all State actions may affect children, a full and formal process of assessing their best interests is not called for in every case, and in para 32 where it is stated that the concept of the childs best interests is flexible and adaptable. 153. The Committees General Comment also realistically recognises that the relevant best interests of children will, in relation to decisions which are not simply about identified individual children, include those of children generally. This is apparent throughout the document, including in those passages from para 102 cited by Lord Carnwath. I respectfully agree with Lady Hale that where article 3(1) applies it is not enough to consider only the interests of children generally, without also evaluating the interests of any likely to be particularly affected by the legislation in prospect, but the converse is also true. It is obvious that in the context of this kind of socio economic legislation, there will be a tension between, on the one hand, the interests of children generally in promoting the legitimate aims of reducing a culture of benefit dependency and encouraging work and, on the other, the special interests of those children most likely to suffer an adverse effect of the cap, such as the present appellants. This is realistically recognised by the UN Committee in, for example, para 32 of the Comment, which reads: The concept of the child's best interests is complex and its content must be determined on a case by case basis. It is through the interpretation and implementation of article 3, paragraph 1, in line with the other provisions of the Convention, that the legislator, judge, administrative, social or educational authority will be able to clarify the concept and make concrete use thereof. Accordingly, the concept of the child's best interests is flexible and adaptable. It should be adjusted and defined on an individual basis, according to the specific situation of the child or children concerned, taking into consideration their personal context, situation and needs. For individual decisions, the child's best interests must be assessed and determined in light of the specific circumstances of the particular child. For collective decisions such as by the legislator the best interests of children in general must be assessed and determined in light of the circumstances of the particular group and/or children in general. In both cases, assessment and determination should be carried out with full respect for the rights contained in the Convention and its Optional Protocols. (emphasis supplied) 154. Whilst the appellants in the present case relied upon article 3(1) as substantive and not merely procedural they did not analyse the extent to which it was asserted that priority ought to be given to childrens best interests, still less the interests of which children. Their chief reliance was upon the suggested failure of the Secretary of State properly to have analysed and considered the best interests of children. Relying upon paragraph 6 of the UN Committees General Comment, the principal submission of Mr Wise QC was that the article 3 obligation required (a) careful consideration of how many children will be or are likely to be affected by the cap, (b) asking what the effect on those children particularly affected by it would be, (c) asking whether the cap could be implemented in a manner protecting such children from adverse effects, and (d) asking whether the general proposition that the cap will lift children out of welfare dependency outweighs the risk to those particularly affected. 155. Like both courts below I regard it as plain that the Secretary of State did not fail to undertake all these exercises. There was the fullest public debate about not only the concept of the cap but its proposed details. This country has four Childrens Commissioners, charged with the duty of monitoring childrens interests and advocating them publicly. All participated in the debate and made strongly the case now made by the appellants that the general benefits to families and children which would be brought by the cap were outweighed by the likely adverse consequences for particular children in situations exactly like those of the present appellants. The two Impact Assessments and the Equality Impact Assessment written by the Government recorded the likely adverse consequences for children such as these, in particular those in larger one parent families living in high rent areas. The Parliamentary debate on the detailed proposals returned time and again to this topic. There was a specific proposal, supported by the House of Lords, to amend the Bill by excluding child benefit from the cap, which, as Lady Hale observes, would no doubt remove the adverse impact on the appellants here relied upon; this proposal was considered but rejected by the House of Commons and withdrawn in consequence by the House of Lords. The Secretary of State concluded, and still concludes, that to do this would drive a coach and horses through the whole policy. The evidence could not really be clearer that the Secretary of State did indeed ask the questions which Mr Wise contends are required by article 3 UNCRC. The appellants real complaint is that he reached what they say is the wrong value judgment when it came to balancing the interests of children (and society) in general against those of particular children likely to suffer adverse effects from the cap. Reasonable people may well either agree or disagree with this value judgment, but to say that one disagrees is not the same as saying that the decision is unlawful. LADY HALE: 156. The benefit cap is one of a package of measures provided for in the Welfare Reform Act 2012. The total amount of benefit to which a couple or a single person is entitled is capped at a prescribed sum, irrespective of how much they would otherwise be entitled to. The bare bones of the scheme are provided for in the 2012 Act, but its detailed implementation is contained in the Benefit Cap (Housing Benefit) Regulations 2012. 157. The appellants do not challenge the compatibility of the Act with their rights under the European Convention on Human Rights, but they do challenge the compatibility of the way in which it has been implemented by the 2012 Regulations. They argue that it has a disproportionate impact upon lone parents and upon the victims of domestic violence; both groups are predominantly, although not exclusively, composed of women; hence the scheme is indirectly discriminatory on grounds of sex. As the scheme falls within the ambit of the protection of property rights in article 1 of the First Protocol to the Convention, this violates their right, under article 14 of the Convention, to enjoy such rights without discrimination unless it can be justified. The Secretary of State accepts that the scheme falls within the ambit of article 1 of the First Protocol and that it is indirectly discriminatory against lone parents and thus against women. The question, therefore, is whether it can be justified. A further question, which has only emerged after the hearing in April 2014, is the extent to which, if at all, the obligations of the United Kingdom under the United Nations Convention on the Rights of the Child is relevant to that issue. 158. Both the Divisional Court and the Court of Appeal held that it can be justified: [2013] EWHC 3350 (QB) and [2014] EWCA Civ 156. This raises several questions: whether the justification advanced relates to the scheme as a whole rather than to its discriminatory effect; what is the test to be applied in deciding whether the discrimination is justified; and what is the part played by the international obligations of the United Kingdom under the United Nations Convention on the Rights of the Child in assessing that. 159. The benefit cap is, of course, quintessentially a matter of social and economic policy. In such matters, as Lord Hope of Craighead observed in R v DPP, Ex p Kebilene [2000] 2 AC 326, at p 381, it will be easier for the courts to recognise a discretionary area of judgment within which the judiciary will defer, on democratic grounds, to the considered opinion of the elected body or person whose act or decision is said to be incompatible with the Convention. As Lord Reed explains, the introduction of the cap was indeed extensively debated in Parliament and various amendments were proposed and resisted which would have mitigated the adverse effects with which we are here concerned. But the details of the scheme, including those adverse effects, were deliberately left to be worked out in regulations. It is therefore the decisions of the Government in working out those details, rather than the decisions of Parliament in passing the legislation, with which we are concerned. 160. Furthermore, as Lord Hope went on to say in In re G (Adoption: Unmarried Couple) [2009] 1 AC 173, para 48, protection against discrimination, even in an area of social and economic policy, falls within the constitutional responsibility of the courts: Cases about discrimination in an area of social policy, which is what this case is, will always be appropriate for judicial scrutiny. The constitutional responsibility in this area of our law resides with the courts. The more contentious the issue is, the greater the risk is that some people will be discriminated against in ways that engage their Convention rights. It is for the courts to see that this does not happen. It is with them that the ultimate safeguard against discrimination rests. Therefore, even in the area of welfare benefits, where the court would normally defer to the considered decision of the legislature, if that decision results in unjustified discrimination, then it is the duty of the courts to say so. In many cases, the result will be to leave it to the legislature to decide how the matter is to be put right. The scheme 161. It is not necessary to go into the scheme in great detail, but it is necessary to understand the essentials. Section 96(1) of the Act provides that Regulations may provide for a benefit cap to be applied to the welfare benefits to which a single person or couple is entitled. Section 96(2) provides that where their total entitlement to welfare benefits exceeds the relevant amount, their entitlement is reduced by the amount of the excess. This is the cap. The relevant amount is to be specified in Regulations (section 96(5)), but is to be determined by reference to estimated average earnings (section 96(6)). By this is meant the amount which, in the opinion of the Secretary of State, represents at any time the average weekly earnings of a working household in Great Britain after deductions in respect of tax and national insurance contributions (section 96(7)). Welfare benefits means any benefit, allowance, payment or credit prescribed in regulations (section 96(10)); but retirement pensions and state pension credit may not be prescribed (section 96(11)). Regulations may also provide for exceptions to the application of the cap (section 96(4)(c)) and also for the benefit or benefits from which the reduction is to be made (section 96(4)(b)). 162. Thus it will be seen that all the details of the scheme are to be covered in the regulations. The only principle required by the Act, should the Government decide to introduce a cap at all, is that it is set by reference to average weekly earnings net of tax and national insurance contributions. This, as Mr Holmes, the lead official in the Department of Work and Pensions responsible for the benefit cap policy, points out, produces a much higher figure than would be produced by working 40 hours a week for the minimum wage or even the London living wage. But the Government was left a free hand in deciding what working age benefits would count towards the cap. 163. In fact, the cap operates by way of a deduction from housing benefit. Hence the 2012 Regulations amend the Housing Benefit Regulations 2006, principally by introducing a new Part 8A, entitled Benefit cap. The relevant amount is set at 350 for a single claimant (without dependent children) and 500 for all other claimants (that is, couples and lone parents with dependent children) (regulation 75G). This is the equivalent of a gross annual salary of 35,000 a year and 26,000 net. A long list of welfare benefits is prescribed, most importantly for our purposes including housing benefit, child benefit and child tax credit (regulation 75G). Once the cap is reached, therefore, no account is taken of the number of children in the family. On the other hand, the benefit cap does not apply at all where the claimant, the claimants partner or a child or young person for whom either is responsible is receiving any of a long list of benefits; these are mainly disability related but include a war pension (regulation 75F). 164. The cap does not apply at all where the claimant is, or the claimant and her partner are jointly, entitled to working tax credit (regulation 75E(1), (2)). This effectively exempts most working households from the cap; the rules are complicated, but a lone parent responsible for a child would qualify for working tax credit if she worked at least 16 hours a week, while a couple responsible for a child would qualify if they worked a total of 24 hours a week, as long as one of them worked for at least 16 hours a week; the normal requirement is 30 hours work a week (Working Tax Credit (Entitlement and Maximum Rate)) Regulations 2002, regulation 4, as amended by the Tax Credits (Miscellaneous Amendments) Regulations 2012, regulation 2). Not only that, if the claimant or her partner have been employed or engaged in work for payment for 50 out of the preceding 52 weeks, the benefit cap will not apply for 39 weeks from their last day of work (regulation 75E(1), (3) (5)). This gives a period of grace in which to find another job or to move house. 165. The final regulation which is relevant for our purposes is that which provides, in effect, that the housing benefit payable for what is now (following a recent amendment) to be termed specified accommodation is disregarded (regulation 75C(2)(a)). The amendment means that womens refuges are now covered, whereas previously many of them were not. However, there is no comparable exemption for housing benefit paid in respect of temporary accommodation provided under the homelessness provisions of Part 7 of the Housing Act 1996. 166. The benefit cap was introduced in April 2013 in four London boroughs, rolled out in July 2013 to a further 335 local authorities and in August 2013 to the remaining 40 authorities in England, Wales and Scotland. It has not yet been implemented in Northern Ireland. Between April 2013 and January 2014, a total of 38,655 households were capped, 47% of these in London and the vast majority in England. 167. As Elias LJ, giving the judgment of the Divisional Court, observed at [2013] EWHC 3350 (Admin), para 11, It was obvious from the outset that the introduction of the cap would have severe and immediate consequences for claimants who had been receiving substantially in excess of the relevant amount. To mitigate this, the Government provided additional funds to local authorities to enable them to make discretionary housing payments (DHPs) to claimants affected by the cap (along with the other purposes for which such payments may be made). This was specifically intended as a short term solution where transitional help was necessary and not as a long term solution to the needs generated by the cap (see Holmes, Witness Statement No 1, para 130). 168. Elias LJ continued, at para 12: The two items most likely to trigger the operation of the cap [are] housing benefit [and] the number of children in the family. Housing benefit reflects (but does not necessarily meet in full) the cost of housing, whether social or private. Accordingly, the cap will bear most heavily on those in receipt of benefit who live in areas where rental costs are high. In practical terms, therefore, this means that those who live in London or in the centre of other big cities where rents tend to be high will be most likely to be affected. It is a striking feature of the scheme and lies at the heart of this application that the cap applies equally to a childless couple in an area with cheap and plentiful social housing as it does to a lone parent mother of several children in inner London compelled to rent on the private market. The appellants circumstances 169. The four appellants are the lone mother and her youngest child in two families (a third family has now withdrawn from the case as the cap no longer applies to them). The following evidence of their circumstances was before the court when the case was heard in April 2014. 170. Ms SG and her family live in Stamford Hill, North London. This is important because they are members of a particular orthodox Jewish sect. The school age children attend a local Jewish school, kosher food is readily available (but expensive) in the local shops, they can walk to the synagogue and there is a support network of family and friends there. Their lone mother has six children in all, but only three of them live with her: a son now aged four, a daughter now aged seven and another daughter now aged nine. The family used to live in Belgium, but SG left her husband and came to live near her relatives in Stamford Hill in order to escape from her husbands abusive behaviour towards her and their eldest daughter, now aged 18. The daughter was made a ward of court to prevent her father removing her from this country. Because of her behavioural and psychological difficulties she was placed by the local authority in foster care within the same community. She has since married but still lives locally and relies heavily upon her mother for support. The oldest son studies in a yeshiva abroad and is unlikely to rejoin the family, but there are currently proceedings in Belgium about the residence of the second son, now aged 12, whom his mother earnestly hopes can return to live with the family in London. 171. The family live in a two bedroomed flat rented from a private landlord. This is already too small for them and would be quite unsuitable were the 12 year old boy to come and live with the family again. When these proceedings began, the rent was 300 per week, but the landlord was proposing to put it up. They were entitled to 289.20 housing benefit, 71.70 income support for SG, 167.30 Child Tax Credit (all means tested benefits), and 47.10 child benefit. Hence their total benefit entitlement before the cap was 575.30 a week. The cap has therefore resulted in a reduction of 75.30 in their weekly income. The landlord has notified an increase in her rent to 420 from 31 January 2014, which would leave them with only 80 to live on. 172. The Secretary of State correctly points out that housing benefit would not in any event meet such a high rent in full (because it exceeds the local housing allowance limit for that part of London). He also argues that there are cheaper two bedroomed flats available in the area, but the appellants dispute this. We are not in a position to resolve such factual disputes. However, it is obvious that SG has very good reasons for wanting to continue to live in Stamford Hill, that accommodation there is in short supply because of demand from the local community, and that if she does stay there her weekly income will fall well below that which the State deems necessary for her and her three young children to live on. 173. For a time, she did have part time work for 16 hours a week and thus the benefit cap did not apply. But she was unable to sustain this, owing to the demands of the court proceedings relating to her children, both here and in Belgium, and the need to care for the younger children. The 39 week grace period expired in November 2013, since when her benefits have been capped. She has been receiving a discretionary housing payment to meet the shortfall between her rent and her housing benefit, but only until 30 June 2014, when it was due to be reviewed having regard to the steps she has taken to avoid the cap. 174. Mrs NS is also the lone mother of three children, daughters now aged 4, 11 and 12. There is a long history of sexual abuse and domestic violence within her marriage, much of it witnessed by the children. She had left her husband to stay in a womens refuge with the children on two previous occasions before their final separation in December 2012. After a period in unsuitable accommodation, she obtained orders excluding her husband from the family home, and returned there with the children in April 2013. Her husband is prohibited from contacting the family there, but last summer they had to turn to him for help with transport when one child suffered an accident requiring surgery and the other two became ill. NS is concerned that the local childrens services authority will consider her children to be at risk of harm if they have contact with their father. 175. Their home is also a two bedroomed flat rented from a private landlord. It is also too small for them but is close to the childrens schools. The rent is 270 a week. She is entitled to 270 housing benefit, 71.70 income support for NS, child tax credit for the children of 166.94 (although she says that she gets only 162.44), and child benefit of 47.10. Her total entitlement therefore should amount to 555.74 (although she says that she gets only 550.44). Whichever it is, the cap reduces it to 500. 176. NS was awarded discretionary housing payments, but only after a delay during which arrears accrued to her rent account, and only until 31 March 2014. The local authority has yet to decide upon its DHP budget for this year and so she does not know whether or not she will get it. She is of course concerned that the landlord may seek to evict her if she falls into arrears. 177. NS did not work outside the home during her marriage, nor has she done so since it ended. She was allowed very little freedom by her husband and speaks very little English. Why is the scheme discriminatory? 178. It is common ground that the scheme falls within the ambit of article 1 of the First Protocol, which protects the right to peaceful enjoyment of possessions. Possessions for this purpose includes entitlement to welfare benefits, not only those which have been paid for by national insurance contributions, but also those which the State provides on a non contributory basis to supply its people with the basic necessities of life. As the Strasbourg court explained in Stec v United Kingdom (2006) 43 EHRR 1017, para 53: Article 1 of protocol No 1 does not include a right to acquire property. It places no restriction on the Contracting States freedom to decide whether or not to have in place any form of social security scheme, or to choose the type or amount of benefits to provide under any such scheme. If, however, a state does decide to create a benefits or pension scheme, it must do so in a manner which is compatible with article 14 of the Convention. 179. It has not been argued that the benefit cap is itself a violation of article 1 of the First Protocol, on the basis that it deprives affected households of the benefits to which they would be entitled under the usual rules relating to needs related welfare benefits. Instead, it is argued that it violates article 14, which provides that the enjoyment of the rights and freedoms set forth in the Convention shall be secured without discrimination on any ground such as sex . It is not suggested that the scheme is directly discriminatory against women, as it affects all benefit claimants in the same way, irrespective of their sex. However, as the Divisional Court observed, It is clear, and indeed conceded, that the benefit cap has a disproportionate adverse impact on women (para 71). This brings it within the concept of indirect discrimination, which was recognised by the Grand Chamber of the European Court of Human Rights in DH v Czech Republic (2007) 47 EHRR 59, at para 175 (see also para 184): The court has also accepted that a general policy or measure that has disproportionately prejudicial effects on a particular group may be considered discriminatory notwithstanding that it is not specifically aimed at that group, and that discrimination potentially contrary to the Convention may result from a de facto situation. The court had earlier recognised the same concept in the cases of Jordan v United Kingdom (2001) 37 EHRR 52, at para 154, and Hoogendijk v Netherlands (2005) 40 EHRR SE 189, at p 207. 180. The prejudicial effect of the cap is obvious and stark. It breaks the link between benefit and need. Claimants affected by the cap will, by definition, not receive the sums of money which the state deems necessary for them adequately to house, feed, clothe and warm themselves and their children. Furthermore, the greater the need, the greater the adverse effect. The more children there are in a family, the less each of them will have to live on. Ms SG, for example, will receive no more benefit if her 12 year old son rejoins the family, even though a court (either here or in Belgium) has decided that it is in his best interests to do so. This prejudicial effect has a disproportionate impact upon lone parents, the great majority of whom are women, and is also said to have such an impact upon victims of domestic violence, most of whom are also women. 181. The disproportionate impact upon lone parents is relatively straightforward to explain. The relevant comparison is between those housing benefit claimants who are, and those who are not, affected by the benefit cap. Lone parents constitute around 24% of all claimants for housing benefit, but have so far constituted between 59% and 74% of those affected by the cap. This is more than double their proportion in the housing benefit population as a whole. Overall some 92% of lone parents are women. Hence it is not surprising that the Government predicted, in its first Equality Impact Assessment of the Benefit Cap (March 2011, para 27), that single women, mostly lone parents, would constitute 60% of those affected. 182. The reasons for this are fairly obvious. It is much more difficult for lone parents to move into paid employment, even for the 16 hours which would take them out of the cap. It is more difficult for them to do so, the more children they have, because of the problems of delivering and collecting children from different schools or day care placements, the problems of making appropriate day care arrangements for very young children and for all children during the school holidays, the problems of responding to their childrens illnesses, accidents and to casual school closures. The more children they have, the harder it will be for them to move into work; and the more children they have, the harsher will be the effects of the cap. These problems arise irrespective of the ages of the children, but are obviously more acute when any or all of them are under school age. 183. The disproportionate effect which the cap is said to have upon victims of domestic violence, most of whom will also be parents, is a little more complicated. It stems from the limited options available to victims who wish to escape, with their children, from the violence and abuse which they are suffering at home. Some victims are fortunate enough to be able to stay in their own homes while the perpetrator either agrees or is ordered to leave and having done so can be relied upon to stay away. But many are not so fortunate. Their only way of escaping the violence, at least in the first instance, is to leave home. If they go to a refuge, the problem is that the costs may easily take them over the cap. Under the original scheme, some refuges counted as exempt accommodation, which effectively created an exception to the cap, but many did not. Very recently, the Government has addressed this, by amendments which will create an exception for all refuges. 184. But not all victims can go to a refuge. Their other alternative is to apply to the local authority for accommodation under the homelessness provisions of Part 7 of the Housing Act 1996. Unlike the cost of refuges, the cost of other types of temporary accommodation is not exempt. Temporary accommodation is often in the private sector and much more expensive than permanent accommodation in social or other forms of affordable housing. Furthermore, as the intervention from Shelter makes clear, a homeless person has very little choice about where she is housed. She has to accept any offer of suitable accommodation or risk becoming literally without a home (and even having her children taken away from her as a result). In areas of high housing need, families may stay for a very long time in so called temporary accommodation before affordable permanent housing becomes available. 185. Some of these victims will want to keep open the possibility of returning to the family home, or securing a transfer, once the family court has decided who is to live there. Hence, very sensibly, the housing benefit scheme provides that in certain circumstances councils may continue to pay benefits in respect of two homes for a certain length of time (Housing Benefit Regulations 2006, regulation 7(6)(a)). But this, of course, means that the total amount of housing benefit, when taken together with other benefits, will take the claimant over the limit where the cap applies. 186. Thus, even with the recent change relating to refuges, the effect of the cap is to undermine the humane treatment given to victims of domestic violence both by the homelessness regime and by the housing benefit scheme. However, although both of the families whose cases are before us have suffered from domestic violence and abuse, they have not suffered these particular adverse effects (we do not know whether Mrs NSs family was in receipt of dual housing payments between December 2012 and April 2013, but in any event that was before the cap came into force), nor do they claim to be at risk of suffering them in the future. For this reason, the Divisional Court and the Court of Appeal declined to decide whether the cap did have a disproportionate effect upon the victims of domestic violence. Mr Wise QC, for the appellants, complains that they should have done so. The appellants have both suffered domestic violence and abuse and Mrs NS might well have to flee to expensive temporary accommodation while wishing to retain the family home should her husband once again try to assert his control over her. 187. In my view, however, the problems suffered by the victims of domestic violence are principally suffered because they are parents who have every reason to separate from the other adult in the household, not only for their own sake but also for the sake of their children. Of course, there may be some victims of domestic violence who are not responsible for the care of children, but it has not been shown how likely it is that they will be affected by the cap or how difficult they would find it to escape its adverse impact. I would therefore treat the victims of domestic violence as a subset of lone parents, who may be more likely to be affected by the cap because of the high cost of temporary accommodation and the dual payments problem, and who will have the same problems in escaping its effects. How is the discrimination justified? 188. The applicable principles are set out in the Grand Chamber judgment in Stec v United Kingdom (2006) 43 EHRR 1017, para 51: Article 14 does not prohibit a Member State from treating groups differently in order to correct factual inequalities between them; indeed in certain circumstances a failure to attempt to correct inequality through different treatment may in itself give rise to a breach of the article. A difference in treatment is, however, discriminatory if it has no objective and reasonable justification; in order words, if it does not pursue a legitimate aim or if there is not a reasonable relationship of proportionality between the means employed and the aim sought to be realised. The Contracting state enjoys a margin of appreciation in assessing whether and to what extent differences in otherwise similar situations justify a different treatment. Two points are clear from this. The first is that it is not the scheme as a whole which has to be justified but its discriminatory effect: see A v Secretary of State for the Home Department [2005] 2 AC 68, per Lord Bingham at para 68; AL (Serbia) v Secretary of State for the Home Department [2008] 1 WLR 1434, per Baroness Hale at para 38. It is not enough for the Government to explain why they brought in a benefit cap scheme. That can readily be understood. They have to explain why they brought in the scheme in a way which has disproportionately adverse effects upon women. 189. However, it is important to understand that what is needed to justify indirect discrimination is different from what is needed to justify direct discrimination. In direct discrimination, it is necessary to justify treating women differently from men. In indirect discrimination, by definition, women and men are treated in the same way. The measure in question is neutral on its face. It is not (necessarily) targeted at women or intended to treat them less favourably than men. Men also suffer from it. But women are disproportionally affected, either because there are many more of them affected by it than men, or because they will find it harder to comply with it. It is therefore the measure itself which has to be justified, rather than the fact that women are disproportionately affected by it. The classic example is a maximum age bar on recruitment to particular posts; it applies to all candidates, women and men; but it disadvantages women because they are more likely to have taken a career break to have or care for children than are men. The question therefore is whether the age bar can be independently justified. This long standing position is reflected in the definition of indirect discrimination in section 19 of the Equality Act 2010. It was also the approach of the Strasbourg court in Hoogendijk v Netherlands (2005) 40 EHRR SE 189, a case of indirect discrimination in relation to welfare benefits. 190. Turning to the explanations offered for the cap, it is important to recognise that the Government has never claimed that its aim is to encourage claimants to limit the size of their families or to penalise those who already have large families (had they done so, they might perhaps have faced discrimination claims on other grounds). The evidence before the court is contained in two witness statements from Mr Holmes. He states that the Government had three specific aims in introducing the benefit cap: (i) (ii) to introduce greater fairness in the welfare system between those receiving out of work benefits and tax payers in employment; to make financial savings (anticipated to be 110m in 2013/14 and 185m in 2014/15) and more broadly, help make the system more affordable by incentivising behaviours that reduce long term dependency on benefits; and (iii) to increase incentives to work. This is later described as the main aim of the policy (Holmes, Witness Statement No 1, para 107). To a great extent, these objectives overlap, as the principal aim is to make being in work more attractive than being out of work, to encourage people into work, and to reduce long term dependence on benefits, thus not only saving public money but also improving the long term future of these families. No one can seriously doubt that these are legitimate aims which would probably be supported by most of the population. The question, however, is whether these reasons for bringing in the cap can justify the sex discrimination involved in the way in which it has been implemented. Before turning to that question, however, it is worth examining the criticisms made of each of the objectives claimed. (i) Fairness 191. It is accepted that achieving fairness between those in work and those out of work is a legitimate aim. As Elias LJ recognised, the fairness concept has sometimes been justified by relying on the notion that those on benefit should face difficult decisions of the kind facing those in work (para 94). But there are many different ways of defining such fairness. It could be that a family on benefits should never be better off than a working family of the same size living in the same accommodation. It could be that a family on benefits should always be worse off than the equivalent working family. Or it could be that a family on benefits should always be much worse off than the equivalent working family. 192. The criticism levelled at the Governments concept of fairness, in particular in the intervention from the Child Poverty Action Group, is that the benefit cap scheme as implemented does not compare like with like. It compares the maximum level of benefit with average earnings, thus ignoring the benefits which are also available to people who are in work. CPAG have produced tables (not challenged in these proceedings) comparing the income available to each of the appellant families according to whether they are (a) not working but without the cap, (b) working 16 hours per week on the minimum wage, (c) working for average household earnings, and (d) working 35 hours a week for the minimum wage. These show that both Ms SG and her children and Mrs NS and her children would be (in round figures) 94 a week better off in scenario (b) than in scenario (a), 163 better off in scenario (c), and 122 better off in scenario (d). In other words, they would always be significantly better off in work than not in work. CPAG have also produced tables which show that this would also be the case wherever in the country these families were living. The effect of the cap is simply to increase the differential which is already there. 193. Thus, it is said, there was no need to introduce the benefit cap in order to ensure that families on benefit have to make the same difficult choices that working families have to make. They already do have to make those choices. If this is so, the focus shifts to the other two objectives. (ii) Saving public money 194. The savings projected by the Treasury in the 2013 budget were 110m in 2013 2014 and 185m in 2014/15. These did not take into account the possible implementation costs or the additional funding made available for DHPs of 65m and 35m respectively. On the other hand, nor did they take into account any resulting behavioural changes. The aim was not merely to make savings in the short term but to produce a positive cultural shift (Holmes, Witness Statement No 2, para 36). 195. It has to be accepted that the savings made are a drop in the ocean compared with the total benefit bill, let alone the total housing benefit bill. The Government predicted that only 1% of housing benefit claimants would be affected by the cap. In May 2013, there were approximately five million housing benefit claimants, yet in January 2014 there were less than 28,000 households subject to the cap, not much over half a percent of all claimants. Lone parents subject to the cap were 1.37% of all claimants (further demonstrating that they are disproportionately affected). 196. However, the main argument made against this aim is that, standing alone, it is not sufficient to justify discriminatory treatment in the enjoyment of a convention right. The authority cited for this proposition is OBrien v Ministry of Justice [2013] UKSC 6, [2013] 1 WLR 522. This was a case about discrimination between full time and part time workers, which is prohibited by the Framework Agreement on Part time Work, annexed to Council Directive 97/81/EC. 197. However, in Andrejeva v Latvia (2009) 51 EHRR 650, the Strasbourg court accepted that the protection of the countrys economic system is a legitimate aim which is broadly compatible with the general objectives of the Convention (para 86). They therefore looked to see whether there was a reasonable relationship of proportionality between that legitimate aim and the means employed. As the discrimination in that case was based solely on nationality, for which very weighty reasons would be required for compatibility with the Convention, the court held that it was not justified (paras 87 88). The same would apply to sex discrimination. If the state introduces a benefit, for example for older people, but denies it to women on the basis that this will save money, this would be contrary to article 14 read with article 1 of the First Protocol, unless there were some other justification for the difference in treatment. The court found such a justification in Stec, because the difference complained of was the result of the difference between the retirement ages of men and women, itself a response to the disadvantage suffered by women in the workplace. This brings the focus back to the proportionality of any discrimination involved in a money saving measure. 198. Mr Holmes also refers in his evidence to a clear, simple message that there has to be a maximum level of financial support beyond which claimants cannot expect the state to provide (Witness Statement No 1, para 98) and one of the key drivers for introducing the cap, that ultimately there has to be a limit to the overall amount of financial support that households in receipt of out of work benefits can expect to receive in welfare payments (para 104). However, it is difficult to see how the delivery of such a message can be an aim in itself if the message is the product of a measure which cannot be justified. (iii) Incentivising work and promoting long term behavioural change 199. On analysis, it is therefore said, the Governments aims come down to incentivising work and promoting long term behavioural change. Again, no one doubts that these are legitimate aims, not only in order to save public money but also, as Mr Holmes put it, to achieve long term positive behavioural effects by changing attitudes to welfare and work and encouraging responsible life choices, which will benefit adults and children alike (Witness Statement No 1, para 121). Put another way, it is not good for children to grow up in a household which is wholly supported by the state, if thereby they absorb the message that there will be no need for them to support themselves when they grow up. 200. However, the Government has accepted that certain people should not be expected to seek work in order to escape the cap. Thus retirement pension and state pension credit are not taken into account because the policy is primarily a work incentive aimed at people of working age (Holmes, Witness Statement No 1, para 100). Thus also the cost of supported accommodation is not taken into account because households in supported accommodation are likely to be in vulnerable situations and they will not generally be in a position to make quickly the behavioural changes required to remove themselves from the cap (para 105). Thus also the disability related exemptions mean that the cap will not apply to people who are least likely to be able to work and who perhaps have the least scope to adjust their circumstances to improve their employment prospects (para 112). Lone parents of children under five are also not expected to seek work, but they are subject to the cap. 201. As well as moving into work, the other choices the Government wished to encourage as a way of avoiding the cap included persuading the landlord to take less rent, moving to cheaper accommodation, reducing expenditure on non housing items, and in the case of lone parents seeking child maintenance from the other parent, which is wholly disregarded for the purpose of the cap (Holmes, Witness Statement No 1, para 124). 202. Against this, both the appellants and the interveners argue that these expectations are simply unrealistic in the case of the families of lone parents and victims of domestic violence, upon whom the policy has such an adverse effect. For the reasons already mentioned, lone parents, especially those with more than one child, find it particularly difficult to obtain even part time work which will fit in with their child care responsibilities. It is accepted, of course, that there are some lone parents, even of very young children, who do manage to do this. Adequate and subsidised day care is now more readily available. But it is unrealistic to assume that parents will always be able to find acceptable solutions without prejudice to their childrens welfare. The Government accepts that lone parents of children under five should not be expected to look for work, no doubt partly because of the difficulties of finding acceptable and affordable child care, but perhaps also because many parents and child care professionals consider it better for very young children to have the full time loving care of a committed parent rather than be separated from them and placed in institutional settings, however competent, for a large part of the day. Even if we accept that it is justifiable to deny this choice to those lone parents who are subject to the benefit cap, we should not accept that their childrens welfare should be put at risk by their having to make unsatisfactory child care arrangements or (as in the case of Mrs NS) to rely upon assistance from a violent partner which the local childrens services authority fears may put the children at risk. 203. Nor is it realistic to assume that they will eventually be able to move to cheaper accommodation. Many private landlords, particularly in the more expensive areas, are unwilling to take tenants who are dependent on housing benefit. In any event, they will require deposits and rent in advance, which the family will not be able to afford (unless they can persuade the local childrens services authority to help out under section 17 of the Children Act 1989). Social housing is in short supply, with long waiting lists which may well require a qualifying period of residence in the area before a person is even placed on the list. The allocation criteria under Part 6 of the Housing Act 1996 do give preference to those homeless families to whom the full housing duty is owed under Part 7 of that Act (1996 Act, section 167(2)(a)). But if the family try to move to another local authority area where housing is cheaper or more plentiful, they may be refused on the ground that they have no local connection with that area. It will be particularly difficult for them to move if they have rent arrears, but the benefit cap is very likely to lead to rent arrears unless there is a speedy grant of a discretionary housing payment to fill the gap, which certainly cannot be guaranteed. 204. The Court of Appeal has recognised that discretionary housing payments are not an answer. In Burnip v Birmingham City Council [2012] EWCA Civ 629, [2013] PTSR 117, the Court of Appeal held that it was unjustifiably discriminatory to limit a severely disabled man who needed an overnight carer to the housing benefit payable for a one bedroomed flat. As Henderson J explained at para 46, where there is a gap between objectively verifiable need and the housing benefit payable, [d]iscretionary housing payments were in principle available as a possible way of bridging this gap, but they cannot in my judgment be regarded as a complete or satisfactory answer to the problem. This follows from the cumulative effect of a number of separate factors. The payments were purely discretionary in nature; their duration was unpredictable; they were payable from a capped fund; and their amount, if they were paid at all, could not be relied upon to cover even the difference between the one and two bedroom rates of LHA [local housing allowance], and still less the full amount of the shortfall. To recognise these shortcomings is not in any way to belittle the valuable assistance that discretionary housing payments are able to provide, but is merely to make the point that, taken by themselves, they cannot come anywhere near to providing an adequate justification for the discrimination in cases of the present type. The additional money made available for DHPs when the benefit cap was introduced is not ring fenced. As Mr Holmes makes clear, these payments were never intended to be a long term solution to the problems facing claimants like these. 205. It was predicted that there would be an increase in evictions and homelessness as a result of the benefit cap. If the family does become homeless because of the cap, the Government hopes that neither the local housing authority nor the courts will regard them as intentionally homeless. They will have a priority need and should therefore be owed the full housing duty under Part 7 of the 1996 Act (1996 Act, sections 189(1)(b), 193(2)). Nevertheless, it may take a very long time before permanent accommodation becomes available, during which time they will be placed in temporary accommodation, often in the private sector. This is known to be more expensive than permanent accommodation. In other words, if they become homeless as a result of the cap, they are equally likely to be capped in their temporary accommodation. They do not have a choice. Provided the accommodation is suitable they have to take what is offered. The Government points out that affordability is part of suitability, but there may well be nothing else available. Local housing authorities have difficulty finding enough accommodation, and it is simply unrealistic to expect a homeless family to turn down an offer of otherwise suitable accommodation on the basis that it is not affordable. The Government wishes to encourage local authorities to move people out of temporary accommodation as soon as possible (Holmes, Witness Statement No 1, para 114), but the question is whether depriving homeless families of the full cost of such accommodation is a proper way to put pressure on local authorities to do so. 206. In addition, there are many other reasons why it may be quite unreasonable to expect a lone parent to move to another area. Finding new schools for several children in an unfamiliar area is not straightforward, nor is it good for the education which will in the long term be the best way of lifting those children out of poverty. Thus the Divisional Court concluded (at para 27, echoed almost precisely at para 22 in the judgment of the Court of Appeal): In the case of each of these claimants, therefore, there are powerful reasons why the suggested ways of mitigating the effects of the cap are not appropriate. The sums are too great to bring [their] finances under control by prudent housekeeping; they are for various reasons not in a position to work; and they have educational and/or cultural and support reasons why they do not want to move any distance from their current homes. 207. As CPAG point out, the Government accepted in its grounds of resistance to the claim that the aim of incentivising claimants to work may be less pertinent for those who are not required to work (such as parents with young children). Hence it has to fall back on making fiscal savings and creating a system which is fairer as between those receiving out of work benefits and working households. The test 208. The Strasbourg court will, of course, allow Contracting states a margin of appreciation in assessing whether the difference in treatment is justified. As is well known, the width of that margin differs according to the subject matter. In Stec, the court went on to explain, in para 52: The scope of this margin will vary according to the circumstances, the subject matter and the background. As a general rule, very weighty reasons would have to be put forward before the court could regard a difference in treatment based exclusively on the ground of sex as compatible with the Convention. On the other hand, a wide margin is usually allowed to the state under the Convention when it comes to general measures of economic or social strategy. Because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is in the public interest on social or economic grounds, and the court will generally respect the legislatures policy choice unless it is manifestly without reasonable foundation. 209. The references cited for the manifestly without reasonable foundation test were James v United Kingdom (1986) 8 EHRR 123, para 46, and National & Provincial Building Society v United Kingdom (1997) 25 EHRR 127, para 80, both cases complaining of a violation of article 1 of the First Protocol. In AXA General Insurance Ltd v HM Advocate [2011] UKSC 46, [2012] 1 AC 868, both Lord Hope, at para 31, and Lord Reed, at para 124, treated this test as directed towards whether the measure is in the public interest, in other words to whether it has a legitimate aim. They dealt separately with whether the interference with property rights was proportionate. They relied upon cases such as Pressos Compania Naviera SA v Belgium (1995) 21 EHRR 301, at para 38, where the Strasbourg court appears to have regarded this as a separate question: An interference with the peaceful enjoyment of possessions must strike a fair balance between the demands of the general interest of the community and the requirements of the protection of the individuals fundamental rights. In particular, there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measure depriving a person of his possessions. (see also In re Recovery of Medical Costs for Asbestos Diseases (Wales) Bill [2015] UKSC 3, [2015] 2 WLR 481, para 52). In this case, the complaint is of discrimination in interfering with the peaceful enjoyment of possessions rather than of deprivation of possessions as such. Nevertheless, the benefit cap does come close to a deprivation of possessions, given that it removes, by reference to a fixed limit, benefit to which the claimants would otherwise be entitled by virtue of their needs and, more importantly, the needs of their children. 210. When it comes to justifying the discriminatory impact of an interference with property rights, a distinction might similarly be drawn between the aims of the interference and the proportionality of the discriminatory means employed. However, it has been accepted throughout this case that the manifestly without reasonable foundation test applies to both parts of the analysis; but that, as this court said in Humphreys v Revenue and Customs Commissioners [2012] UKSC 18, [2012] 1 WLR 1545, at para 22, the fact that the test is less stringent than the weighty reasons normally required to justify sex discrimination does not mean that the justifications put forward for the rule should escape careful scrutiny. Relevance of the United Nations Convention on the Rights of the Child 211. In Burnips case, at para 21, Maurice Kay LJ pointed out that In the recent past, the European court has shown an increased willingness to deploy other international instruments as aids to the construction of the Human Rights Convention. He cited, among others, the important case of Opuz v Turkey (2009) 50 EHRR 695, at para 185: When considering the definition and scope of discrimination against women, in addition to the more general meaning of discrimination as determined in its case law, the court has to have regard to the provisions of more specialised legal instruments and the decisions of international legal bodies on the question of violence against women. 212. Burnip was concerned with discrimination against disabled people by failing to make reasonable accommodation for their special needs. The United Nations Convention on the Rights of Persons with Disabilities (CRPD) was cited to the Court of Appeal, but not, it appears, the case of Glor v Switzerland, Application No 13444/04, 30 April 2009, where the Strasbourg court reiterated that the Convention must be interpreted in the light of present day conditions, including the European and worldwide consensus on the need to protect people with disabilities from discriminatory treatment, citing in particular the CRPD. The Court of Appeal in Burnip felt able to determine the issue without resort to the CRPD, but had he not been able to do so, Maurice Kay LJ would have resorted to that Convention, which would have resolved any uncertainty in favour of the claimants. He continued It seems to me that it has the potential to illuminate our approach to both discrimination and justification (para 22). 213. Likewise, our approach to both discrimination and justification in this case may be illuminated by reference to other international instruments to which the United Kingdom is party, including not only the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW), which was the relevant instrument in Opuz v Turkey, but also most notably the United Nations Convention on the Rights of the Child (UNCRC). In Neulinger v Switzerland (2010) 54 EHRR 1087, for example, the Grand Chamber observed, at para 131: The Convention cannot be interpreted in a vacuum but must be interpreted in harmony with the general principles of international law. Account should be taken of any relevant rules of international law applicable in the relations between the parties, and in particular the rules concerning the international protection of human rights . It went on, at para 135, to note that there is currently a broad consensus including in international law in support of the idea that in all decisions concerning children their best interests must be paramount. 214. This may be putting matters a little too high. The relevant international instruments relied upon by the Grand Chamber were, principally, article 3(1) of UNCRC: In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration. This is pithily echoed in the Charter of Fundamental Rights of the European Union, article 24(2): In all actions relating to children, whether taken by public authorities or private institutions, the childs best interests must be a primary consideration. 215. As this court recognised in ZH (Tanzania) v Secretary of State for the Home Department [2011] UKSC 4, [2011] 2 AC 166, para 25, a primary consideration is not the same as the primary consideration still less the paramount consideration. Nevertheless, the obligation to treat their best interests as a primary consideration in all actions concerning children is binding upon the Government of this country in international law. It has also become relevant in domestic law in at least two ways. First, section 11 of the Children Act 2004 places a duty on a wide range of bodies providing public services to carry out their functions having regard to the need to safeguard and promote the welfare of children. This duty has also been placed on the Secretary of State for the Home Department in the exercise of her functions in relation, among other things, to immigration, asylum or nationality, by section 55 of the Borders, Citizenship and Immigration Act 2009. 216. This duty has not yet, however, been extended to all Government departments, including the Department of Work and Pensions, with whose decisions we are concerned in this case. Nevertheless, in a Written Statement to Parliament on 6 December 2010, the Minister of State for Children and Families made a clear commitment that the Government will give due consideration to the UNCRC articles when making new policy and legislation. In doing so, we will always consider the UN Committee on the Rights of the Childs recommendations but recognise that, like other state signatories, the UK Government and the UN Committee may at times disagree on what compliance with certain articles entails. It is not surprising, therefore, that the Joint Committee on Human Rights, in its scrutiny of the Welfare Reform Bill, regretted that the Government had failed to carry out any detailed analysis of the compatibility of the Bill with the UNCRC (Session 2010 2012, 21st Report, Legislative Scrutiny: Welfare Reform Bill, para 1.35). The Government has not resiled from that commitment, which is repeated in the Cabinet Office Guide to Making Legislation (July 2013, para 11.30), but it has not yet been translated into domestic law. 217. However, the international obligations which the United Kingdom has undertaken are also taken into account in our domestic law insofar as they inform the interpretation and application of the rights contained in the European Convention, which are now rights in UK domestic law. There is no reason at all why those obligations should not inform the interpretation of the Convention right to the enjoyment of the substantive Convention rights without discrimination just as much as they inform the interpretation of the substantive Convention rights. ZH (Tanzania) happened to be a case about article 8, as were H (H) v Deputy Prosecutor of the Italian Republic, Genoa [2012] UKSC 25, [2013] 1 AC 338, and Neulinger itself. The Strasbourg court has taken the UNCRC into account in construing other articles of the Convention, most notably article 6 in relation to the fair trial of juvenile offenders, in T v United Kingdom (1999) 30 EHRR 121. 218. For these reasons, echoing Maurine Kay LJ in Burnip, I agree that our international obligations under the UNCRC and CEDAW have the potential to illuminate our approach to both discrimination and justification. Whatever the width of the margin of appreciation in relation to the subject matter of a measure, the Strasbourg court would look with particular care at the justification put forward for any measure which places the United Kingdom in breach of its international obligations under another human rights treaty to which we are party. 219. Hence it is no surprise that the Divisional Court held that the court should have regard to the UNCRC as a matter of Convention jurisprudence and the Secretary of State did not challenge that view in the Court of Appeal (see para 69 of their judgment) or, initially, in this court. The Statement of Facts and Issues agreed between the parties for this court included: (c) Was the Court of Appeal wrong to have found that the discriminatory effects of the 2012 Regulations on lone parents were justified and lawful, and not contrary to article 14 (read with article 8 and/or article 1 of Protocol 1); and (d) Was the Court of Appeal wrong to have found that the respondent has complied with his obligation to treat the best interests of children as a primary consideration when implementing the benefit cap scheme? Not surprisingly, therefore, this court took it as common ground that article 3(1) of the UNCRC was relevant to the discrimination issue. The question was whether it had been complied with. After the hearing, however, it became clear that the Secretary of State no longer accepted that article 3(1) was relevant to whether the admitted indirect discrimination could be justified. He was therefore permitted to file further arguments on the issue, to which the appellants and the interveners were permitted to reply. This has had the beneficial effect of enabling us to consider the issue in more detail. 220. The Secretary of State makes two main arguments against taking article 3(1) of UNCRC into account in deciding whether this discrimination can be justified. The first is that the UNCRC, like other international conventions, can inform the substantive content of the Convention rights, but not the approach to proportionality and discrimination. As to proportionality, this argument is clearly negated by the Grand Chamber decision in Neulinger v Switzerland (2010) 54 EHRR 1087, where the best interests of the child were taken into account in deciding whether the interference with the parties rights to respect for their family life, entailed in an order to return to the childs home country of Israel, was proportionate. Reference was also made to the long line of cases dealing with the expulsion of aliens, according to which, in order to assess the proportionality of an expulsion measure concerning a child who has settled in the host country, it is necessary to take account of the childs best interests and well being (para 146). In those cases, the best interests of a child have been taken into account in assessing the proportionality of an interference with the Convention rights of others: see Uner v Switzerland (2006) 45 EHRR 421, at paras 57 58. 221. It is no doubt for that reason that the Secretary of State for the Home Department conceded, in ZH (Tanzania) [2011] 2 AC 166, that removing the mother would be a disproportionate interference with the childrens article 8 rights. This concession was rightly made, irrespective of section 55 of the Borders, Citizenship and Immigration Act 2009. The relevance of the duty in that section was to whether the decision was in accordance with the law (see para 24) rather than to its proportionality. 222. As to discrimination, the Secretary of States argument is clearly negated by the Grand Chamber decision in X v Austria (2013) 57 EHRR 405. This was a case of alleged discrimination on grounds of sexual orientation. A same sex partner could not adopt so as to become a joint parent with the birth parent partner, whereas an opposite sex partner could do so. When dealing with the relevant international law, at para 49, the court begins with the article 3(1) of the UNCRC, before turning to article 21 and other specific provisions on adoption. When discussing the suggested justifications for the discrimination, at para 146, the court concludes that Unless any other particularly convincing and weighty reasons militate in favour of such an absolute prohibition, the considerations adduced so far would seem rather to weigh in favour of allowing the courts to carry out an examination of each individual case. This would also appear to be more in keeping with the best interests of the child, which is a key notion in the relevant international instruments. The footnote refers back to para 49. In common with Lord Carnwath, I read this case as clearly indicating that the best interests of the child are to be taken into account in determining whether discrimination is justified under article 14. 223. The second argument now advanced by the Secretary of State is that the discrimination in this case is not against the children involved but against their mothers. It is not suggested that the rights of the children themselves have been infringed. This case may be contrasted with Neulinger, and indeed ZH (Tanzania), in which the complaint was of interference with the childrens right to respect for their family lives, as well as their mothers. However, the same cannot be said of X v Austria. The child was a complainant, but it was not suggested that there had been discrimination against her; rather it was that the discrimination against her mother and her mothers same sex partner affected (but did not infringe) her right to respect for her family life. It is difficult indeed to see how the family life of the child in that case was any more affected by the legal status of the people looking after her than is the family life of the children involved in this case by the financial situation in which the benefit cap has placed their parents. 224. There is the further point, most clearly articulated by Lord Reed at para 89 of his judgment, that the children living with lone parent fathers suffer just as much as the children living with lone parent mothers. Their welfare cannot therefore be relevant to justifying the discrimination between them. However, for the reasons explained in para 189 earlier, this point does not arise when the discrimination complained of is indirect rather than direct. It is of the nature of indirect discrimination that the measure in question applies to both men and women. What has to be considered is whether the measure itself, which in this case I take to be the benefit cap as it applies to lone parents, can be justified independently of its discriminatory effects. In considering whether that measure can be justified, I have no doubt at all that it is right, and indeed necessary, to ask whether proper account was taken of the best interests of the children affected by it. Application 225. Both the Divisional Court and the Court of Appeal concluded that the Government had complied with its obligation to treat the best interests of the children concerned as a primary consideration (paras 75 and 49, respectively). They were, of course, correct to say that the Government was keenly aware of the impact the benefits cap would be likely to have on children (Court of Appeal, para 74(2)). But it does not follow from that that the the rights of children were, throughout, at the forefront of the decision makers mind (para 75, emphasis supplied). Still less does it follow that their best interests were being treated as a primary consideration. In agreement with the powerful judgments of Lord Carnwath and Lord Kerr on this point, it is clear to me that they were not. 226. The Governments contention was that the long term shift in welfare culture, or reversing the impact of benefit dependency on families and children, would be beneficial to children in the longer run. This may well be so, although it is interesting how little prominence was given to this aspect of the matter in the justifications put forward by the Government for their policy. But in any event, this is to misunderstand what article 3(1) of the UNCRC requires. It requires that first consideration be given to the best interests, not only of children in general, but also of the particular child or children directly affected by the decision in question. It cannot possibly be in the best interests of the children affected by the cap to deprive them of the means to provide them with adequate food, clothing, warmth and housing, the basic necessities of life. It is not enough that children in general, now or in the future, may benefit by a shift in welfare culture. Insofar as the Secretary of State relies upon this as an answer to article 3(1), he has misdirected himself. 227. It may be worth noting that the UNCRC contains some specific obligations which go beyond treating childrens interests as a primary consideration when making decisions concerning them. Article 27(1) provides that States Parties recognise the right of every child to a standard of living adequate for the childs physical, mental, spiritual, moral and social development. Although parents have the primary responsibility to secure, within their abilities and financial capacities, the conditions of living necessary for the childs development (article 27(2)), States Parties have to take appropriate measures to assist parents and others responsible for the child to implement this right and shall in case of need provide material assistance and support programmes, particularly with regard to nutrition, clothing and housing (article 27(3)). The usual approach of the Strasbourg court is that the Convention confers no right to be provided with any particular welfare benefit but that, if it is provided, it must be provided in a non discriminatory manner. The United Kingdom performs its obligations towards children, among other ways, through the welfare benefits system, which provides specific benefits in order that children shall be free from want. The benefit cap deprives some children, principally those in larger families living in high cost accommodation, of provision for their basic needs in order to incentivise their parents to seek work, but discriminates against those parents who are acknowledged to be least likely to be able to do so. The children affected suffer from a situation which is none of their making and which they themselves can do nothing about. 228. This case is therefore very different from the case of Humphreys v Revenue and Customs Commissioners [2012] UKSC 18, [2012] 1 WLR 1545, in which the Government had to justify the discriminatory effect of paying child tax credit to the parent with the main responsibility for looking after the child, even though the care of the child was shared with another parent. This was indirectly discriminatory against fathers, but the object was to concentrate the help for the child where it was most needed and to maximise the amount of public money available to support children. As the Government put it, the benefit attaches to the child rather than the parent (para 25). 229. Viewed in the light of the primary consideration of the best interests of the children affected, therefore, the indirect discrimination against women inherent in the way in which the benefit cap has been implemented cannot be seen as a proportionate means of achieving a legitimate aim. Families in work are already better off than those on benefits and so the cap is not necessary in order to achieve fairness between them; saving money cannot be achieved by unjustified discrimination; but the major aim, of incentivising work and changing the benefits culture, has little force in the context of lone parents, whatever the age of their children. Depriving them of the basic means of subsistence cannot be a proportionate means of achieving it. Relief 230. The claimants seek both declaratory relief and an order quashing Part 8A of the Housing Benefit Regulations. The latter would not be appropriate, given that it is not suggested in this case that the implementation of the cap in relation to single person and two parent households is incompatible with the Convention rights. It is the implementation in relation to lone parents, some of whom will be fleeing domestic violence, and their dependent children, which has been shown to be incompatible. 231. There are several different ways in which that incompatibility might be cured, most notably perhaps by taking the child tax credit and/or child benefit payable to lone parents out of the list of welfare benefits taken into account in calculating the cap. It is true, of course, that the Government resisted amendments to take housing benefit, child benefit and child tax credit out of the cap, on the ground that this would be to emasculate its policy objectives. It is easy to see how this might be so, if it were done for all claimants. But it has not been shown that taking the child related benefits out of the cap as it applies to lone parents would do so. In any event, it is obvious that there is sufficient flexibility in the statutory scheme to enable appropriate solutions to be crafted. It is not for this court to suggest any particular way in which the problem might be solved. 232. In my view, therefore, the appropriate relief would be a declaration that Part 8A of the Housing Benefit Regulations is incompatible with the Convention rights in that its application to lone parents is indirectly discriminatory on grounds of sex, contrary to article 14 of the Convention read with article 1 of the First Protocol. LORD KERR: 233. As Lord Hughes has observed, there is much common ground among the members of the panel about the issues that arise on this appeal. He has helpfully outlined the areas of agreement in para 135 of his judgment. I am also in broad agreement with virtually all of Lord Carnwaths judgment (except as to outcome) and am in complete agreement with Lady Hale that the appeal should be allowed for the reasons that she has given. On one view, therefore, there is nothing to be gained from my contributing further to the debate. But I have changed the view that I originally held about the direct effect of article 3 of UNCRC and wish to explain why. If I am wrong in my revised view, there remain two particular issues which separate the majority from Lady Hales approach (which I would favour as an alternative to my principal conclusion) that I believe are of vital importance and which have implications well beyond this appeal. For that reason, I feel constrained to say something of them as well. 234. The two issues are these: (i) if article 3 does not have direct effect, what is the use to which it may be put in considering the proportionality of a measure which interferes with a Convention right; and (ii) whether there is a sufficient identity of interest between a child and her or his lone parent so as to render discrimination against the child discrimination against the parent. Before turning to those issues, however, I wish to begin by examining the role of unincorporated treaties. The role of unincorporated treaties 235. Two dominant principles have traditionally restricted the use of international treaties in British domestic law. The first is that domestic courts have no jurisdiction to construe or apply treaties which have not been incorporated into national law; that they are effectively non justiciable. The second is that such treaties, unless incorporated into domestic law, are not part of that law and therefore cannot be given direct effect to create rights and obligations under national or municipal law. This is a matter of constitutional orthodoxy. It underpinned the series of decisions in which courts consistently refused to give effect to Convention rights before the coming into force of the Human Rights Act 1998. See, for instance, R v Secretary of State for the Home Department, Ex p Brind [1991] 1 AC 696, 747 748, Lord Bridge of Harwich and at 762B D Lord Ackner; NALGO (1992) 5 (Admin) LR 785, 798, Re McKerr [2004] UKHL 12; [2004] 1 WLR 807: Lord Nicholls of Birkenhead at para 25, Lord Steyn at para 48, Lord Hoffmann at para 63, Lord Rodger of Earlsferry at para 80 and Lord Brown of Eaton under Heywood at para 90. 236. Perhaps the high water mark of the dualist conception of the restriction on the use of international law was reached in J H Rayner (Mincing Lane) Ltd v Department of Trade and Industry (International Tin Council) [1990] 2 AC 418. The House of Lords reaffirmed the two principles of non justiciability and no direct effect. This was on the basis that domestic courts had no competence in respect of the legal relations between sovereign states, nor was the royal prerogative reviewable. At 499F/500C Lord Oliver of Aylmerton said: It is axiomatic that municipal courts have not and cannot have the competence to adjudicate upon or to enforce the rights arising out of transactions entered into by independent sovereign states between themselves on the plane of international law On the domestic plane, the power of the Crown to conclude treaties with other sovereign states is an exercise of the Royal Prerogative, the validity of which cannot be challenged in municipal law . That is the first of the underlying principles. The second is that, as a matter of the constitutional law of the United Kingdom, the Royal Prerogative, whilst it embraces the making of treaties, does not extend to altering the law or conferring rights upon individuals or depriving individuals of rights which they enjoy in domestic law without the intervention of Parliament. Treaties, as it is sometimes expressed, are not self executing. Quite simply, a treaty is not part of English law unless and until it has been incorporated into the law by legislation. 237. Of course the prerogative can now be reviewed, in appropriate circumstances see, for instance, Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374; R (Abbasi) v Secretary of State for Foreign and Commonwealth Affairs [2002] EWCA Civ 1598, [2003] UKHRR 76. The conduct of foreign affairs, including the making of treaties is still considered to be beyond the reach of judicial review, however. In R (Campaign for Nuclear Disarmament) v Prime Minister of the United Kingdom [2002] EWHC 2759, 126 ILR 727 the High Court held that domestic courts will not determine the meaning of an international instrument (in this case a UN Security Council Resolution) operating purely on the plane of international law. It was said that the only cases in which the court would pronounce on an issue of international law are those where it is necessary to do so in order to determine rights and obligations under domestic law, so as to draw the court into the field of international law (at paras 36 40, 47(i)). 238. Despite the seemingly comprehensive ban on the use by the courts of unincorporated international treaties to recognise rights on the domestic law plane, there are three possible ways which have been considered by the courts in which such treaties may have an impact on national law (i) as an aid to statutory interpretation; (ii) as an aid to development of the common law; and (iii) as a basis for legitimate expectation. Unincorporated treaties as an aid to statutory interpretation 239. Where a legislative provision is ambiguous there is a presumption that Parliament intended to legislate in a manner which does not involve breach of international treaty obligations: Salomon v Commissioners of Customs and Excise [1967] 2 QB 116, 143E G; Garland v British Rail Engineering Ltd [1983] 2 AC 751, 771 (Lord Diplock). See also Sir John Laws [1993] PL 58, 83. While New Zealand allows non ambiguous legislation to be read down, or additional words to be read in for the purpose of consonance with international treaties (eg Sellers v Maritime Safety Inspector [1999] 2 NZLR 44, CA), this is not currently the case in the UK see Collco Dealings Ltd v Inland Revenue Commissioners [1962] AC 1, 19; Quazi v Quazi [1980] AC 744, 808D E; JH Rayner (Mincing Lane) Ltd v Department of Trade and Industry [1990] 2 AC 418, 481F H, 500E (the International Tin Council case); R v Secretary of State for the Home Department, Ex p Brind [1991] 1 AC 696, 747 749, 760D G; Brown [1994] 1 AC 212, 256E F; J A Pye (Oxford) Ltd v Graham [2002] UKHL 30; [2003] 1 AC 419, 65; R v Lyons (Isidore) [2002] UKHL 44, [2003] 1 AC 976, 13; Boyce v The Queen [2004] UKPC 32, [2005] 1 AC 400, 25 and 81; Abdirahman v Secretary of State for Work and Pensions [2007] EWCA Civ 657, [2008] 1 WLR 254, at 35 40. 240. But the presumption of compatibility of domestic legislation with international law is well established. A recent example is to be found in Assange v Swedish Prosecution Authority [2012] 2 AC 471 where at para 122 Lord Dyson said: there is no doubt that there is a strong presumption in favour of interpreting an English statute in a way which does not place the United Kingdom in breach of its international obligations. Unincorporated treaties and the development of the common law 241. It is clear that unincorporated treaties may have a bearing upon the development of the common law: Lyons [2002] UKHL 44, [2003] 1 AC 976, 13 per Lord Bingham. Developments of the common law should ordinarily be in harmony with the UKs international obligations: A v Secretary of State for the Home Department (No 2) [2005] UKHL 71; [2006] 2 AC 221 Lord Bingham at para 27. Unincorporated treaties may also be used to resolve ambiguities in the common law: Derbyshire County Council v Times Newspapers Ltd [1993] AC 534. See also Director of Public Prosecutions v Jones (Margaret) [1999] 2 AC 240 Lord Slynn at 265D F, Lord Hope at 277E 278F: reference to the ECHR for guidance was found to be inappropriate in context as there was no doubt about the content of the common law. By implication, at least, where such doubt is present, consideration of an international convention or treaty such as ECHR would be appropriate in order to determine what the common law position is or should be. 242. The proposition that the common law cannot be used to incorporate treaties through the backdoor has, however, been reasserted in, for instance, A v Secretary of State for the Home Department (No 2) [2004] EWCA Civ 1123; [2005] 1 WLR 414 Laws LJ at paras 266 267, Neuberger LJ at para 434. Unincorporated treaties and legitimate expectation 243. In Chundawadra v Immigration Appeal Tribunal [1998] Imm AR 161 it was argued that every citizen had a legitimate expectation that, if the ECHR was relevant to a matter under consideration, the Minister would take it into account when deciding how to exercise his powers. The Court of Appeal refused to accept this argument, holding that it was not appropriate to introduce the Convention into domestic law by the back door in this way. 244. Arguments based on the Australian authority of Minister of State for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273; 128 ALR 353 were considered by the Court of Appeal in Behluli v Secretary of State for the Home Department [1998] Imm AR 407, at para 415. The court expressly refused to follow Teoh; it held that mere ratification of a treaty could not generate a legitimate expectation that the treaty would be followed. Two months later, however, a different division of the Court of Appeal indicated a willingness to adopt and follow Teoh in relation to decisions taken under the Royal Prerogative. In R v Secretary of State for the Home Department, Ex p Ahmed and Patel [1998] INLR 570, the Court of Appeal held that the entering into a treaty by the Crown could give rise to a legitimate expectation because, subject to any indication to the contrary, ratification amounted to a representation that the Crown would act in accordance with the obligations imposed on it by the treaty in question. The High Court followed this approach in R v Uxbridge Magistrates' Court, Ex p Adimi [2001] QB 667, DC, (Simon Brown LJ at para 686, Newman J at paras 690 691), although apparently without having Chundawadra or Behluli cited to it. 245. In the High Court in R v Director of Public Prosecutions, Ex p Kebilene [2000] 2 AC 326 Lord Bingham CJ rejected an attempt to base a legitimate expectation on the ratification of the ECHR, observing that ratification took place nearly half a century ago at a time when it was generally assumed that ratification would have no practical effect on British law or practice. (This view was endorsed by the House of Lords). Laws LJ at pp 353 356, agreeing with Lord Bingham, referred to what had by then become the somewhat hackneyed theme that the legitimate expectation argument would effectively introduce the ECHR through the back door. He acknowledged, however, that the Convention had plainly informed the common law and he noted Teoh but suggested that any extension of this area would have to be at a higher level, to overcome the House of Lords authority of Brind. 246. The proposition that the doctrine of legitimate expectation can generate a right to rely on the provision of an unincorporated treaty in the interpretation and application of domestic law is, at least, controversial. But treaties concerning human rights are, for reasons that I will develop, in a different position. Human rights cases 247. A small opening for an exception in relation to human rights treaties can perhaps be seen in Lewis v AG of Jamaica [2001] 2 AC 50 PC, where Lord Slynn, although upholding the traditional principles of non justiciability and no direct effect, acknowledged the argument that an exception might be read into these rules when the treaty in question was a human rights treaty: even assuming that that [rule] applies to international treaties dealing with human rights . : p 84. In Foreign Relations and the Judiciary (2002) 51 ICLQ 485, 496 Lord Collins has commented on this passage: these words contemplate the possibility that unincorporated treaties relating to human rights may be given effect without legislation [I]t may be a sign that one day the courts will come to the view that it will not infringe the constitutional principle to create an estoppel against the Crown in favour of individuals in human rights cases. 248. In Re McKerr Lord Steyn cast doubt on the applicability of the fundamental principles set out in International Tin Council so far as they governed the position in relation to human rights treaties, arguing that the rationale of the dualist theory, which underpins the International Tin Council case, is that any inroad on it would risk abuses by the executive to the detriment of citizens. It is, however, difficult to see what relevance this has to international human rights treaties which create fundamental rights for individuals against the state and its agencies. A critical re examination of this branch of the law may become necessary in the future at paras 49 50. 249. While acknowledging that the point had not been the subject of argument, Lord Steyn referred to some academic criticism of International Tin Council and highlighted what he termed growing support for the view that human rights treaties enjoy a special status, citing the views of Murray Hunt (Using Human Rights Law in English Courts (1998)), at pp 26 28) and the extra judicial comments of Lord Collins quoted above. 250. In International Law in Domestic Courts: The Developing Framework (2008) 124 LQR 388 Philip Sales and Joanne Clement attack this argument, pointing out that the rationale for International Tin Council is that the Crown cannot change domestic law by the exercise of prerogative powers as this would infringe the sovereignty of Parliament. In adopting what might be regarded as a somewhat absolutist position, Sales and Clement argue at para 388: In a dualist state such as the United Kingdom, international law and domestic law are regarded as separate legal systems, operating on different planes. International law does not, as such, form part of the domestic legal system. While in particular instances rules of international law may apply in domestic law, they do so by virtue of their adoption by the internal law of the state. 251. The Sales and Clement article provides a comprehensive survey of international law in this area. They argue forcefully that unincorporated treaties should not be extended so as to have direct effect in national law. The dualist structure of our law, which treats international law as operating on a separate plane, has, they suggest, been repeatedly upheld as a central constitutional, legal and political principle. They conclude at 421: The risk of some degree of dissonance between domestic law and international law is the natural consequence of self government by states and of parliamentary sovereignty as the primary constitutional principle of government within the state, and its elimination is a matter for the political process. It is not the proper function of the domestic courts to change domestic legal principles to eliminate such dissonance. 252. In an article entitled Human Rights Treaties in the English Legal System published in [2011] PL, 554 576, Dr Bharat Malkani has challenged the central thesis of Sales and Clement. He argues that one needs to question why Parliament should be treated as the proper locus of law making power. Dr Malkani suggests that the enactment of the Human Rights Act and the incorporation of ECHR into domestic law brought about a change in the constitutional order and that parliamentary sovereignty is no longer the principal basis of the British constitution. This was, rather, the rule of law. On this basis he argues that the constitutional principle of parliamentary sovereignty does not require that international conventions on human rights be transformed into domestic law in order to create rights, citing Alan Brudner The Domestic Enforcement of International Covenants on Human Rights: A Theoretical Framework (1985) 35 University of Toronto Law Journal. Brudner propounds a theory which would be regarded as highly radical in UK law to the effect that a convention while in origin a treaty between independent states, is in content the legislation of a universal community of rational beings. On this account, he argues that since international conventions on human rights articulate principles rationally connected to the common good, they do not require to be transformed into national law. 253. In light of the authorities that I have earlier considered, it may safely be said that such a far reaching approach is unlikely to find favour in the courts of this country. It is perhaps noteworthy, however, that other commentators have been critical of the courts adherence to the dualist theory of international law, especially in relation to human rights conventions see, for instance, Brice Dickson, Safe in Their Hands? Britains Law Lords and Human Rights (2006) 26 Legal Studies 329, 335; D Beyleveld The concept of a human right and incorporation of the European Convention on Human Rights [1995] PL 577; M Hunt Using Human Rights Law in English Courts (Oxford: Hart, 1997). 254. I consider that the time has come for the exception to the dualist theory in human rights conventions foreshadowed by Lord Slynn in Lewis and rather more firmly expressed by Lord Steyn in Re McKerr to be openly recognised. This can properly be done in relation to such conventions without espousing the complete abandonment of the theory advocated by some of the commentators referred to above. 255. If Lord Steyn is right, as I believe he is, to characterise the rationale for the dualist theory as a form of protection of the citizen from abuses by the executive, the justification for refusing to recognise the rights enshrined in an international convention relating to human rights and to which the UK has subscribed as directly enforceable in domestic law is not easy to find. Why should a convention which expresses the UKs commitment to the protection of a particular human right for its citizens not be given effect as an enforceable right in domestic law? 256. Standards expressed in international treaties or conventions dealing with human rights to which the UK has subscribed must be presumed to be the product of extensive and enlightened consideration. There is no logical reason to deny to UK citizens domestic laws vindication of the rights that those conventions proclaim. If the government commits itself to a standard of human rights protection, it seems to me entirely logical that it should be held to account in the courts as to its actual compliance with that standard. This is particularly so in the case of UNCRC. On its website UNICEF has stated that: The CRC is the basis of all of UNICEFs work. It is the most complete statement of childrens rights ever produced and is the most widely ratified international human rights treaty in history. 257. I therefore consider that article 3(1) of UNCRC is directly enforceable in UK domestic law. A primacy of importance ought to have been given to the rights of children in devising the regulations which bring the benefits cap into force. For the reasons given by Lady Hale, I have concluded that this has not taken place. The alternative argument 258. In the Court of Appeal Lord Dyson MR said at para 69: The Divisional Court held that, notwithstanding the fact that the UNCRC is an international convention which has not been incorporated into our domestic law, the court should nevertheless have regard to it as a matter of Convention jurisprudence: see Neulinger v Switzerland (2010) 54 EHRR 1087, cited by Baroness Hale in ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166, para 21. This has not been challenged by the Secretary of State on this appeal. 259. One starts therefore with the proposition that UNCRC is, as Lord Carnwath has put it, legally relevant. Its legal relevance stems from the fact that, as again Lord Carnwath has put it, under ECHR and in accordance with the Vienna Convention, regard may be had to principles of international law, including international conventions in order to interpret the terms and notions of the Convention Demir v Turkey (2008) 48 EHRR 1272. Lord Carnwath has said that in the cases of X v Austria (2013) 57 EHRR 405, Ponomaryov v Bulgaria (2011) 59 EHRR 799 and Burnip v Birmingham City Council [2013] PTSR 117, the court used international materials to fill out, or reinforce, the content of a Convention article (para 130). I would prefer to put the matter slightly differently. 260. What the courts did in those cases, following the Demir approach was to recognise that the nature and content of Convention rights could be informed by international instruments which expressed standards that were internationally recognised. This does not involve directly applying the provisions of an international treaty which had not been incorporated into domestic law. It does not introduce those provisions by the back door. Rather, it reflects the courts obligation, charged as we are with the duty of obtaining a proper understanding of the nature of an avowed right, to have regard to standards which have found expression in those treaties. We should do this for the prosaic but extremely important reason, as I have said in para 256 above, that they have been the product of extensive and, hopefully, enlightened consideration. 261. If the rights enshrined in those treaties are not directly enforceable in domestic law it is, of course, open to domestic courts to refuse to allow such treaties to have any influence whatever on our conclusions as to the content of the right. Such an approach would be justified where, for instance, the right was too broadly expressed or too remote from the subject under consideration. Or we could conclude that the right was too ambivalently stated to allow any influence to be brought to bear on the content of a right asserted under domestic law. But where the claimed right is directly relevant to the domestic issue to be decided, then recourse to the standards that the international instrument exemplifies is not only legitimate, it is required. How, otherwise, are we to acquire a true understanding of the proper contours and content of the right under discussion? This is not applying an unincorporated international treaty directly to domestic law. It is merely allowing directly relevant standards to infuse our thinking about what the content of the domestic right should be. 262. Article 3(1) of UNCRC is unquestionably directly relevant to the question of whether a primacy of importance was given to the interests of children in formulating the regulations which give effect to the benefits cap. As I have already said, I agree with Lady Hale that it was not. I will say no more on that topic. The critical issue now is whether there is a sufficient connection between the interests of the children and those discriminated against, viz their lone mothers, to make discrimination against the children of those mothers discrimination against them also. Put another way, as Lord Carnwath does in para 115 of his judgment, is there a direct link between the international treaty relied on and the particular form of discrimination alleged? The indissociability of a child and her/his lone mother 263. In this case the government accepts that the benefits cap discriminates against women as lone parents. Its defence of this admitted discrimination rests exclusively on its claim that it is justified by the social objectives which it pursues. It claims, however, that justification of those objectives does not require it to give primary consideration to the impact of the benefit cap on the children of lone mothers. That, the government says, is because the interests of lone mothers can be disassociated from those of their children. Lord Carnwath has accepted this argument. He considers that the interests of children are distinct from their single parent mothers. I cannot agree. 264. The particular species of discriminatory impact here is on women who, by reason of their position as lone mothers, claim to suffer a disproportionate interference with their Convention rights. Justification of the interference must be related to the condition which provides the occasion for the discrimination viz the position of these women as lone parents. A mothers personality, the essence of her parenthood, is defined not simply by her gender but by her role and responsibility as a carer of her children, particularly when she is a lone parent. 265. Justification of a discriminatory measure must directly address the impact that it will have on the children of lone mothers because that impact is inextricably bound up with the womens capacity to fulfil their role as mothers. If you take money away from children which mothers would receive on their behalf, money which they use to realise their role as mothers, the discrimination that you perpetrate involves withholding resources necessary to fully discharge their maternal role. Because, therefore, one cannot segregate the interests of the deprived children from those of their mothers, the discrimination against mothers and their children is of the same stripe. No hermetically sealed compartmentalisation of their interests is possible. 266. A lone mothers interests, when it comes to receiving state benefits, are indissociable from those of her children. The rate of her benefits is fixed by reference (among other things) to the number and needs of those children. Her capacity to care for her children is likewise directly connected to the amount of state benefits that she receives. The interests of single mothers are, therefore, inextricably bound up with the interests of their dependent children, for the trite and prosaic reason that they are parents. Any adverse impact on a lone parents financial position is inevitably transmitted to the child because of her or his dependence (financially as well as otherwise) on the parent. For these reasons, when one comes to consider the justification for interference with a lone parents Convention right, the interests of the children of that parent cannot be left out of account. 267. If the disproportionate effect on lone parents can only be justified by addressing their position as the providers for dependent children, attention to the interests of those children is an integral part of the process. How, otherwise, are their interests to be taken into account? As Lord Reed has said, regard has been had to the UNCRC by the European Court of Human Rights in the application of the ECHR, when considering how its substantive guarantees apply to children. When considering the rights of children as a component part of their mothers rights under A1P1 and article 14, there is no reason that UNCRC should not likewise infuse the determination of what the content of those rights should be. I therefore agree with Lady Hale that, in considering whether the particular species of interference in this case is justified, the interests of the children affected are, by reason of article 3(1) of UNCRC, to be treated as a primary consideration. 268. Once this position is reached, the question for the government is how to meet the challenge of showing that the measures which discriminate against the child (and ergo the mother) are no more intrusive than they need to be. In this context, I have no difficulty in accepting that the test set out in Stec v United Kingdom (2006) 43 EHRR 1017 continues to apply. So, as a yardstick of the proportionality of this general measure of economic or social strategy, the question is whether it was manifestly without reasonable foundation. But, if article 3(1) of UNCRC has to play its part in deciding whether the benefits cap was without reasonable foundation, it requires that first consideration be given to the best interests of the children directly affected by the decision. 270. I would therefore allow the appeal and make the order that Lady Hale proposes. 269. For the reasons given by Lady Hale in para 220, it cannot be in the best interests of the children affected by the cap to deprive them of the means of having adequate food, clothing, warmth and housing. Depriving children of (and therefore their mothers of the capacity to ensure that they have) these basic necessities of life is simply antithetical to the notion that first consideration has been given to their best interests.

The benefit cap was introduced in the Welfare Reform Act 2012 and implemented by the Benefit Cap (Housing Benefit) Regulations 2012 (the Regulations). The main issue in this appeal is whether the Regulations are unlawful under the Human Rights Act 1998. It is argued that the cap has an unjustifiably discriminatory impact on women in relation to their right to the peaceful enjoyment of their possessions, contrary to article 14 of the European Convention on Human Rights taken with article 1 of the First Protocol to the ECHR (A1P1). The cap applies where the total entitlement of a single person or couple to specified welfare benefits exceeds an amount which represents the average weekly earnings of a working household in Great Britain, net of tax and national insurance contributions. The Regulations fix the cap at 350 a week for a single claimant without dependent children, and 500 for all other claimants. Benefits taken into account include housing benefit, child benefit and child tax credit. The Governments justification for the scheme is that it is necessary (i) to set a reasonable limit on the extent to which the state will support non working families from public funds; (ii) provide members of households of working age with a greater incentive to work and (iii) achieve savings in public expenditure. The cap does not apply to persons or families entitled to working tax credit. Receipt of this benefit requires a lone parent responsible for a child to work at least 16 hours a week, and a couple with a child to work a total of 24 hours a week, with one of them working at least 16 hours. The cap affects a higher number of women than men. That is because the majority of non working households receiving the highest levels of benefits are single parent households, and most single parents are women. The appellants are two lone mothers and their youngest children. The application of the cap reduced SGs weekly income from the specified benefits by 75, and NSs by 55. The courts below held that the indirectly discriminatory impact of the scheme upon lone parents, and therefore women, could be justified and that the scheme was therefore lawful. The Supreme Court dismisses the appeal by a majority of 3 2. Lord Reed gives the lead judgment, with which Lord Hughes agrees. Lord Carnwath concurs with the result but for different reasons. Lady Hale and Lord Kerr each give dissenting judgments. Lord Reed notes that it was conceded that the Regulations result, indirectly, in differential treatment of men and women in relation to welfare benefits, and that the benefits constitute possessions falling within A1P1. [60 61] The question is whether the cap is a proportionate means of meeting legitimate aims. Lord Reed accepts that the aims of the cap are legitimate. [63 66] In relation to proportionality, the appellants argued that the aim of setting a reasonable limit to benefits could be achieved by setting the cap at the average income of working households inclusive of in work benefits, rather than their average earnings exclusive of benefits. Lord Reed notes, however, that the Act requires the cap to be set by reference to earnings. [67 69] The appellants also argued that the savings in public expenditure were marginal. Lord Reed notes that, although the short term savings are a small proportion of the total welfare budget, they nevertheless contribute towards deficit reduction. The cap is also intended to change behaviour over the longer term. Other arguments focused on the impact of the cap on the families affected. Lord Reed notes that the cap for households with children is equivalent to a gross annual salary of 35,000, which is higher than the earnings of half of the UKs working households. Whether the cap should be higher is a political question. It is not the function of the courts to determine how much public expenditure should be devoted to welfare benefits. Importantly, affected households were given advance notice and assistance to enable them to adjust. [70 75] The differential impact results from including child related benefits in the cap. Excluding these would reduce savings by 80 90% and compromise the achievement of the caps legitimate aims. No credible means were suggested by which those aims might be achieved without affecting more women than men. [76 77] Other arguments relied on the United Nations Convention on the Rights of the Child (UNCRC), which has not been incorporated by Parliament into UK law, but which can be relevant to the application of the ECHR. Strasbourg cases do not support the argument that the cap impinges on the article 8 ECHR rights of children, and that therefore article 3(1) UNCRC obliged the Government to treat the best interests of children as a primary consideration. [78 80] Although the UNCRC can be relevant to questions concerning the rights of children under the ECHR, the present context is one of alleged discrimination against women in the enjoyment of their A1P1 property rights. [86 89] The argument that the Regulations were vitiated by the Governments misinterpretation of article 3(1) was no stronger. It is firmly established that UK courts cannot interpret or apply treaties to which Parliament has not given effect. [90] Lord Reed further reasons that the question of proportionality involves controversial issues of social and economic policy, with major implications for public spending. It is therefore necessary for the court to give due weight to the considered assessment of democratically elected institutions. Unless manifestly without reasonable foundation, their assessment should be respected by the court. Many of the issues in the appeal were considered by Parliament before it approved the Regulations. The Governments view, endorsed by Parliament, that achieving its aims was sufficiently important to justify making the Regulations, despite the differential impact on men and women, was not manifestly without reasonable foundation. [92 96] Lord Hughes adds that Strasbourgs case law is a long way from saying that article 3(1) is relevant to justification of any kind of discrimination, whether or not the rights, upbringing, or family life of a child are affected. [144] Lord Carnwath agrees that article 3(1) UNCRC has no role in justifying discrimination against women: the treatment of the child does not depend on the sex of their parent. [129] It is trite law that unincorporated treaties like the UNCRC have no direct effect in domestic law unless and until incorporated by statute. [115] On compliance with article 3(1), he reasons that the Governments reliance on limiting expenditure and the need for a clear upper limit on benefits ignores the distinctive statutory purpose of child related benefits: to meet the needs of children as individuals. The cap means children lose these benefits for reasons unrelated to their own needs. If excluding those benefits emasculates the scheme, this raises questions about the viability of a scheme so dependent on child related benefits. However, though the Secretary of State failed to show how the Regulations comply with article 3(1), it is in the political, rather than the legal, arena that the consequences should be played out. [123 127, 133] Lady Hale, in her dissenting judgment, reasons that the question is whether the legitimate aims of the cap justify the discrimination involved in its implementation. [189] The manifestly without reasonable foundation test applies to both the aims of the interference with property rights, and the proportionality of the discriminatory means employed. [209] The UNCRC has not yet been generally translated into domestic law, but Strasbourg case law shows that article 3(1) UNCRC is relevant to proportionality and discrimination as well as informing the substantive content of Convention rights, even in cases where the discrimination is not against the children but their mothers. [215 222] What has to be considered is whether the benefit cap as it applies to lone parents can be justified independently of its discriminatory effects. In considering that, it is necessary to ask whether proper account has been taken of the best interests of the children affected, i.e. whether the Government complied with article 3(1). It is clear to Lady Hale that it did not. The cap deprives some children of provision for their basic needs, which cannot be in their best interests. It does so in order to incentivise their parents to seek work, but discriminates against lone parents, who are least likely to be able to do so. [223 226] In light of article 3(1), the indirect sex discrimination inherent in the caps implementation is not a proportionate way of achieving its aims. [228] Lord Kerr, in his dissenting judgment, considers that the UNCRC can be directly enforceable in domestic law. [255 256] He further reasons that a mothers personality is defined not simply by her gender but by her role as carer for her children, so that justification of a discriminatory measure must directly address the impact on the children of lone mothers. [264 265]

longest

These proceedings arise out of the deaths of three young men who lost their lives while serving in the British Army in Iraq and the suffering by two other young servicemen of serious injuries. The units in which they were serving were sent to Iraq as part of Operation TELIC. This operation, which lasted from January 2003 to July 2009, had two distinct phases of military activity. The first began on 19 March 2003 when Iraq was invaded by coalition forces including those from the United Kingdom. The second phase began on 1 May 2003 when major combat operations ceased and were replaced by a period of military occupation. During much of that time there was a constant threat of enemy action by insurgents opposed to the interim Iraqi government. On 25 March 2003 Corporal Stephen Allbutt, who was the husband of the claimant Ms Deborah Allbutt, Lance Corporal Daniel Twiddy and Trooper Andrew Julien were serving with the Queens Royal Lancers as part of the Royal Regiment of Fusiliers battle group during the fourth day of the offensive by British troops to take Basra. They were in one of a number of Challenger II tanks which had been placed at a dam in hull down positions to minimise their visibility to the enemy. Just after midnight a Challenger II tank of the Second Royal Tank Regiment which had been assigned to the 1st Battalion Black Watch battle group and was commanded by Lt Pinkstone crossed over onto the enemy side of a canal to take up a guarding position some distance to the south east of the dam. At about 0050 hrs Lt Pinkstone identified two hot spots through his thermal imaging sights which he thought might be personnel moving in and out of a bunker. He described the location to Sgt Donlon who was unable to identify the hot spots for himself because the description he was given was incorrect. After Lt Pinkstone had identified a further four hot spots in the same area he was given permission to fire by Sgt Donlon. Lt Pinkstones tank fired a first round of high explosive shell at about 0120 hrs and a second round shortly afterwards. The hot spots that he had observed were in fact men on top of Cpl Albutts Challenger II tank at the dam. The first shell landed short of the tank, but the explosion blew off the men who were on top of it including Lance Corporal Twiddy. The second shell entered the tank and killed Cpl Allbutt, injured Trooper Julien and caused further injury to Lance Corporal Twiddy. It also killed Trooper David Clarke: see R (Gentle and another) v Prime Minister [2008] UKHL 20, [2008] AC 1356, para 1. Lt Pinkstone did not know of the presence at the dam of the Royal Regiment of Fusiliers battle group. He did not realise that he was firing back across the canal, as he was disorientated and believed that he was firing in a different direction. In 2005 Private Phillip Hewett, who was the son of the claimant Susan Smith, was serving with 1st Battalion the Staffordshire Regiment. On 10 May 2005 he was deployed to Camp Abu Naji, near the town of Al Amarah in the Maysan Province of Iraq. He was assigned to a battle group working alongside soldiers from other battalions. In mid July 2005 there was a substantial threat against Camp Abu Naji from rocket attacks and an operation was launched to counter this threat by restricting the movement of insurgent anti Iraqi forces. On 15 July 2005 Pte Hewett was assigned to a mobile unit which was sent that evening to patrol around Al Amarah. The unit consisted of three Snatch Land Rovers. Snatch Land Rovers are lightly armoured. Their armour is designed to provide limited protection against ballistic threats, such as those from small arms fire. It provided no protection, or no significant protection, against improvised explosive devices (IEDs). It was escorted into, but not around, the town by a Warrior fighting vehicle. Warriors are heavily armoured and tracked, and are capable of carrying seven or eight personnel as well as the crew. Pte Hewett was in the lead Snatch Land Rover as its driver with 2nd Lt Richard Shearer. It had no electronic counter measures (ECMs) to protect it against the threat of IEDs. At about 0115 hrs on 16 July 2005 an explosion was heard in the vicinity of the stadium in Al Amarah. 2nd Lt Shearer decided to investigate the explosion. As the Snatch Land Rovers were driving down the single road to the stadium an IED detonated level with the lead vehicle. Pte Hewett, 2nd Lt Shearer and another soldier who was acting as top cover died in the explosion, and two other occupants of the vehicle were seriously injured. In 2006 Private Lee Ellis, who was the father of the claimant Courtney Ellis and the brother of the claimant Karla Ellis, was serving with the 2nd Battalion the Parachute Regiment. His unit was attached to the Royal Scots Dragoon Guards and was based at Camp Abu Naji. On 28 February 2006 Pte Ellis was the driver of a Snatch Land Rover in a patrol of three Warriors and two Snatch Land Rovers which made a journey from the Camp to the Iraqi police headquarters in Al Amarah. Captain Richard Holmes and another soldier were in the same vehicle. On the return journey from the police headquarters an IED was detonated level with the lead Snatch Land Rover driven by Pte Ellis. He and Captain Holmes were killed by the explosion and another soldier in the vehicle was injured. The vehicle had been fitted with an ECM, but a new part of that equipment known as element A was not fitted to it at that time. Element A was fitted to the other Snatch Land Rovers used in the Camp within a few days of the incident. The claims The claims by Ms Deborah Allbutt, Lance Corporal Daniel Twiddy and Trooper Andrew Julien (the Challenger claims) are brought in negligence at common law only. They make two principal claims. First, they allege a failure to ensure that the claimants tank and the tanks of the battle group that fired on it were properly equipped with the technology and equipment that would have prevented the incident. That equipment falls into two categories: target identity devices that provide automatic confirmation as to whether a vehicle is a friend or foe; and situational awareness equipment that permits tank crews to locate their position and direction of sight accurately. Secondly, they allege that the Ministry of Defence (the MOD) was negligent in failing to provide soldiers with adequate recognition training pre deployment and also in theatre. The claims by Susan Smith and by Courtney and Karla Ellis (the Snatch Land Rover claims) fall into two parts. The first, which is common to all three claimants, is that the MOD breached article 2 of the European Convention on Human Rights by failing to take measures within the scope of its powers which, judged reasonably, it might have been expected to take in the light of the real and immediate risk to life of soldiers who were required to patrol in Snatch Land Rovers. The second, which is brought by Courtney Ellis only, is based on negligence at common law. The particulars of the Smith claim under article 2 of the Convention are that the MOD (i) failed to provide better/medium armoured vehicles for use by Pte Hewetts commander which, if provided, would have been used for Pte Hewetts patrol, (ii) failed to ensure that any patrol inside Al Amarah was led by a Warrior, (iii) caused or permitted a patrol of three Snatch Land Rovers to proceed inside Al Amarah, especially when there was no ECM on the lead Snatch Land Rover and it knew or ought to have known that ECMs were ineffective against the triggers that were in use by the insurgents and no suitable counter measures had been provided, (iv) permitted the patrol of Snatch Land Rovers to investigate the bomb blast, especially when there was only one road to the decoy bomb site, (v) failed to provide other vehicles for route clearing and route planning ahead of the Snatch Land Rovers, (vi) failed to provide suitable counter measures to IEDs in the light of the death of Lance Corporal Brackenbury, who was killed by an IED while in a Snatch Land Rover on 29 May 2005 and (vii) failed to use means other than patrols to combat the threat posed by the insurgents. The particulars of the Ellis claim under article 2 and in negligence are that the MOD failed (i) to limit his patrol to better, medium or heavily armoured vehicles, (ii) to provide any or any sufficient better or armoured vehicle for use by Pte Elliss commander which, had they been provided, would or should have been used for his patrol and (iii) to ensure that Element A had been fitted to the ECM on Pte Elliss Snatch Land Rover, without which it should not have been permitted to leave the Camp. The MODs primary case in reply to the Challenger claims and the Ellis claim in negligence is that they should all be struck out on the principle of combat immunity. It also pleads that it would not be fair, just or reasonable to impose a duty of care on the MOD in the circumstances of those cases. Its case for a strike out in reply to the Snatch Land Rover claims under article 2 of the Convention falls into two parts. First, it submits that at the time of their deaths Pte Hewett and Pte Ellis were not within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention. Secondly, it submits that on the facts as pleaded the MOD did not owe a duty to them at the time of their deaths under article 2. The strike out applications were heard by Owen J, who handed down his judgment on 30 June 2011: [2011] EWHC 1676 (QB), [2011] HRLR 795. He struck out the Snatch Land Rover claims under article 2 on the ground that Pte Hewett and Pte Ellis were not within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention when they died: para 48. He based this decision on R (Smith) v Oxfordshire Assistant Deputy Coroner (Equality and Human Rights Commission intervening) [2010] UKSC 29, [2011] 1 AC 1. He went on nevertheless, in a carefully reasoned judgment, to address the question whether, if the deceased were within the Convention jurisdiction, the MOD was under a substantive article 2 duty of the kind that the Snatch Land Rover claimants were contending for. He said that he would not have struck out their claims relating to the supply of equipment: para 80. But in his judgment there was no sound basis for extending the scope of the implied positive duty under article 2 to decisions made in the course of military operations by commanders: para 81. Holding that the doctrine of combat immunity should be narrowly construed, he refused to strike out the Challenger claims and the second and third of the three Ellis claims in negligence because he was not persuaded that their equipment and pre deployment training claims were bound to fail: paras 110, 111. But he struck out the first of the Ellis claims because he was of the opinion that this claim fell squarely within the scope of combat immunity: para 114. On 19 October 2012 the Court of Appeal (Lord Neuberger MR, Moses and Rimer LJJ) dismissed appeals by the Snatch Land Rover claimants on the question whether the deceased were within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention: [2012] EWCA Civ 1365, [2013] 2 WLR 27. It found it unnecessary to deal with the extent of the substantive obligations implicit within that article. It also dismissed the MODs appeal against the judges refusal to strike out the Challenger claims and the second and third of the Ellis claims in negligence on the ground of combat immunity. But it allowed a cross appeal by the Ellis claimants against the striking out of the first Ellis claim. This was because, although the allegation was of failures of the MOD away from the theatre of war, there might be factual questions as to the circumstances in which the decisions were made which would enable the MOD to raise the defence of combat immunity at the trial: para 63. All these issues are now the subject of appeals by the claimants and a cross appeal by the MOD to this court. It will be convenient to take first the question whether at the time of their deaths Pte Hewett and Pte Ellis were within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention. If they were, I propose to consider next the question whether article 2 imposes positive obligations on the states party to the Convention with a view to preventing the deaths of their own soldiers in active operations against the enemy. Finally, there are the claims made at common law where the question is whether the allegations of negligence by the Challenger and Ellis claimants should be struck out because they fall within the scope of combat immunity or because it would not be fair, just or reasonable to impose a duty to take care to protect against such death or injury. I. Jurisdiction: article 1 ECHR (a) the domestic authorities Article 1 of the Convention provides as follows: The High Contracting Parties shall secure to everyone within their jurisdiction the rights and freedoms defined in section 1 of this Convention. In Soering v United Kingdom (1989) 11 EHRR 439 at para 86 the Strasbourg court said that article 1 sets a limit, notably territorial, on the reach of the Convention and that the engagement undertaken by a contracting state is confined to securing the listed rights and freedoms to persons within its own jurisdiction. It does not govern the actions of states not parties to it, nor does it purport to be a means of requiring the contracting state to impose Convention standards on other states. The essentially territorial notion of jurisdiction was also emphasised by the Grand Chamber in Bankovic v Belgium (2001) 11 BHRC 435, para 67, where it said that it is only in exceptional cases that acts of the contracting states performed, or producing effects, outside their territories can constitute an exercise of jurisdiction by them within the meaning of article 1 of the Convention. In Andrejeva v Latvia, (Application No 55707/00), given 18 February 2009, para 56, the Grand Chamber reiterated that the concept of jurisdiction for the purposes of article 1 reflects that terms meaning in public international law and that it is closely linked to the international responsibility of the state concerned. The question that the Snatch Land Rover claims raise is whether the jurisdiction of the United Kingdom extends to securing the protection of article 2 of the Convention to members of the armed forces when they are serving outside its territory. For that to be so it would have to be recognised that service abroad by members of the armed forces is an exceptional circumstance which requires and justifies the exercise by the State of its jurisdiction over them extra territorially. In R (Al Skeini) v Secretary of State for Defence [2007] UKHL 26, [2008] AC 153 (Al Skeini (HL)) the House of Lords was asked to consider the case of the deaths of six Iraqi civilians which were the result of actions by a member or members of the British armed forces in Basra. One of them, Mr Baha Mousa, had died as a result of severe maltreatment in a prison occupied and run by British military personnel. It was argued for the civilians that, because of the special circumstances in which British troops were operating in Basra, the conduct complained of, although taking place outside the borders of the United Kingdom and any other contracting state, fell within the exceptions recognised by the Strasbourg jurisprudence. The House held that, although one such exception was recognised where a state through effective control of another territory exercised powers normally exercised by the government of that territory, the obligation to secure the Convention rights would arise only where a contracting state had such effective control over an area as to enable it to provide the full package of rights and freedoms guaranteed by article 1 of the Convention to everyone within that area: Lord Rodger of Earlsferry at para 79; Lord Brown of Eaton under Heywood at para 129. The United Kingdoms presence in Iraq fell far short of such control. As Lord Rodger put it in para 78, the idea that the United Kingdom was obliged to secure the observance of all the rights and freedoms as interpreted by the European court in the utterly different society of southern Iraq was manifestly absurd. The Secretary of State accepted that, as the events occurred in a British detention unit, Mr Mousa met his death within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention: Lord Rodger at para 61. So far as the other appellants were concerned, the United Kingdom did not have the kind of control of Basra and the surrounding area that would have allowed it to have discharged its obligations, including its positive obligations, as a contracting state under article 2. Three aspects of the discussion of the issue in that case should be noted at this stage. First, the appellants were all citizens of Iraq. They were not state agents of the United Kingdom or otherwise subject to its control or authority. British servicemen, on the other hand, are under the complete control of the UK authorities and are subject exclusively to UK law. Secondly, the House was plainly much influenced by the ruling on jurisdiction by the Grand Chamber in Bankovic which emphasised the centrality of territorial jurisdiction, the regional nature of the Convention and the indivisibility of the package of rights in the Convention: Lord Rodger at para 69. As Lord Brown noted in para 109, Bankovic stood, among other things, for the proposition that the rights and freedoms defined in the Convention could not be divided and tailored. In para 75 of Bankovic the proposition which attracted these observations was in these terms: . the Court is of the view that the wording of article 1 does not provide any support for the applicants suggestion that the positive obligation in article 1 to secure the rights and freedoms defined in section 1 of this Convention can be divided and tailored in accordance with the particular circumstances of the extra territorial act in question. In para 65 of its judgment in that case the Grand Chamber said that the scope of article 1 was determinative of the very scope of the contracting parties positive obligations and, as such, of the scope and reach of the entire Convention system of human rights protection. Thirdly, it was recognised that it was for the Strasbourg court to define the exceptions and evaluate the grounds for departing from the general rule: Lord Bingham of Cornhill at para 29. As Lord Brown put it at para 105, the ultimate decision on the question must necessarily be for that court. Lord Rodger referred at para 67 to the problem which the House had to face, which was that the judgments and decisions of the European court did not speak with one voice. On the one hand there was Issa v Turkey (2004) 41 EHRR 567, where the court said at para 71 that accountability for violation of the Convention rights and freedoms of persons in another state stems from the fact that article 1 of the Convention cannot be interpreted so as to allow a state party to perpetrate violations of the Convention on the territory of the other state which it could not perpetrate on its own territory. This appeared to focus on the activity of the contracting state, whereas the emphasis in Bankovic was on the requirement that the victim should be within the jurisdiction. In these circumstances the House was of the view that it would not be proper to proceed beyond the jurisprudence of the European court on jurisdiction as analysed and declared by the Grand Chamber in Bankovic. The appellants then sought just satisfaction in Strasbourg. In the meantime the jurisdiction question was considered by the domestic court in two further cases: R (Gentle) v Prime Minister [2008] AC 1356 and R (Smith) v Oxfordshire Assistant Deputy Coroner (Equality and Human Rights Commission intervening) [2010] UKSC 29, [2011] 1 AC 1 (Catherine Smith). The question in Gentle was whether article 2 of the Convention imposed a substantive duty on the state to take timely steps to obtain reliable legal advice before committing its troops to armed conflict: see para 3. The claimants were the mothers of two soldiers who were killed while serving in Iraq, one of whom was killed by the same shell as killed Cpl Allbutt and injured Trooper Julien and Lance Corporal Twiddy: see para 3, above. The issue which the claimants wished to explore was the lawfulness of the military action on which the United Kingdom had been engaged in Iraq before it was legitimised by United Nations Security Council Resolution 1546 of 8 June 2004. Lord Bingham said at para 8(3) that, although the soldiers were subject to the authority of the United Kingdom, they were clearly not within its jurisdiction as that expression in the Convention had been interpreted in Al Skeini (HL), paras 79 and 129. But the case was decided on the basis that the claimants were unable to establish the duty which they asserted: see Lord Bingham at para 6. In para 39 Lord Rodger said article 2 of the Convention did not impose an obligation on the government not to take part in an invasion that was unlawful in international law: see also Baroness Hale of Richmond, para 57. In para 19 I said that the guarantee in the first sentence of that article was not violated simply by deploying servicemen and women on active service overseas as part of an organised military force which was properly equipped and capable of defending itself, even though the risk of their being killed was inherent in what they were being asked to do. The issue in Catherine Smith was whether a British soldier in Iraq when outside his base was within the scope of the Convention. The appellant was the mother of Private Jason Smith who had been mobilised for service in Iraq as a member of the Territorial Army and was stationed at Camp Abu Naji. He collapsed while working off base. He was rushed by ambulance to the Camps medical centre but died there almost immediately of heat stroke. The issue in the case concentrated on the question whether the inquest into his death had to satisfy the procedural requirements of article 2. The Secretary of State conceded that, as Private Smith was on the base when he died, Mrs Smith was entitled to the relief which she sought. This meant that the issue had become largely academic, as Lord Phillips recognised in para 2. But on this occasion the Court decided to examine the question and express its opinion on it. The Court was divided on the issue by six to three. The majority held that the contracting states, in concluding the provisions of the Convention, would not have intended it to apply to their armed forces when operating outside their territories. Lord Collins, who delivered the leading judgment on behalf of the majority, said in para 307 that the case came within none of the exceptions recognised by the Strasbourg court, and that there was no basis in its case law, or in principle, for the proposition that the jurisdiction which states undoubtedly have over their armed forces abroad both in national law and international law means that they are within their jurisdiction for the purposes of article 1. Repeating a point that had been made by Lord Rodger in Al Skeini (HL), he said that, to the extent that Issa v Turkey stated a principle of jurisdiction based solely on authority and control by state agents, it was inconsistent with Bankovic. In para 308 he said that there were no policy grounds for extending the scope of the Convention to armed forces abroad, as this would ultimately involve the courts in issues relating to the conduct of armed hostilities which was essentially non justiciable. The leading judgment for the minority was delivered by Lord Mance, with whom Lady Hale and Lord Kerr agreed. It is not possible to do justice to it in a brief summary. But some points that are of particular importance should be noted. In para 188 he said that, to the extent that jurisdiction under the Convention exists over occupied territory, it does so only because of the occupying states pre existing authority and control over its own armed forces. An occupying state cannot have any jurisdiction over local inhabitants without already having jurisdiction over its own armed forces, in both cases in the sense of article 1 of the Convention. In para 194 he said that the United Kingdoms jurisdiction over its armed forces was essentially personal. It could not be expected to take steps to provide in Iraq the full social and protective framework and facilities which it would be expected to provide domestically. But the United Kingdom could be expected to take steps to provide proper facilities and proper protection against risks falling within its responsibility or its ability to control or influence when despatching and deploying armed forces overseas. In paras 195 197 he examined the question whether there would be consequences beyond or outside any that the framers of the Convention could have contemplated and concluded that none of the matters that might give cause for concern justified giving to the concept of jurisdiction a different or more limited meaning to that which in his opinion followed from the guidance that the Strasbourg court had already given in Bankovic. It is however worth noting that he did not attach the same importance as the majority did to the proposition in Bankovic that the rights and freedoms defined in the Convention could not be divided and tailored, and that he was inclined to give more weight than they were to a principle of jurisdiction based on the authority and control which the contracting state had over its armed forces. (b) Al Skeini in Strasbourg The structure of the relevant part of the Grand Chambers judgment, at (2011) 53 EHRR 589, falls into two parts. First, there is a comprehensive statement of general principles relevant to the issue of jurisdiction under article 1 of the Convention. Secondly, those principles are applied to the facts of the case. Although the facts of that case are different from those which are before this Court in these appeals, both parts of the judgment provide important guidance as to how we should resolve the issue with which we have to deal. The statement of general principles begins in para 130 with the observation that the exercise of jurisdiction, which is a threshold condition, is a necessary condition for a contracting state to be able to be held responsible for acts or omissions imputable to it which give rise to an allegation of the infringement of rights and freedoms set forth in the Convention. The significance of this observation in the context of these appeals is that it is not disputed that the United Kingdom has authority and control over its armed forces when serving abroad. It has just as much authority and control over them anywhere as it has when they are serving within the territory of the United Kingdom. They are subject to UK military law without any territorial limit: Armed Forces Act 2006, section 367(1). The extent of the day to day control will, of course, vary from time to time when the forces are deployed in active service overseas, especially when troops are in face to face combat with the enemy. But the legal and administrative structure of the control is, necessarily, non territorial in character. are set out: In paras 131 132 the general principles relevant to the territorial principle 131 A states jurisdictional competence under article 1 is primarily territorial. Jurisdiction is presumed to be exercised normally throughout the states territory. Conversely, acts of the contracting states performed, or producing effects, outside their territories can constitute an exercise of jurisdiction within the meaning of article 1 only in exceptional cases. 132 To date, the Court in its case law has recognised a number of exceptional circumstances capable of giving rise to the exercise of jurisdiction by a contracting state outside its own territorial boundaries. In each case, the question whether exceptional circumstances exist which require and justify a finding by the Court that the state was exercising jurisdiction extra territorially must be determined with reference to the particular facts. One can take from these paragraphs two important points. First, the word exceptional is there not to set an especially high threshold for circumstances to cross before they can justify a finding that the state was exercising jurisdiction extra territorially. It is there to make it clear that, for this purpose, the normal presumption that applies throughout the states territory does not apply. Secondly, the words to date in para 132 indicate that the list of circumstances which may require and justify a finding that the state was exercising jurisdiction extra territorially is not closed. In Catherine Smith, para 303 Lord Collins said that Bankovic made it clear in paras 64 and 65 that article 1 was not to be interpreted as a living instrument in accordance with changing conditions. That can no longer be regarded as an entirely accurate statement. The general principles are derived from the application to particular facts of the requirement of jurisdictional competence. The particular facts to which those principles must now be applied may be the product of circumstances that were not foreseen by the framers of the Convention. But that is no reason to disregard them if they can be shown to fall within the general principles relevant to jurisdiction under article 1. The Grand Chamber in Al Skeini then set out to divide the general principles relevant to jurisdiction into three distinct categories: state agent authority and control; effective control over an area; and the Convention legal space. We are not concerned in the case of the Snatch Land Rover claims with a situation where, as a consequence of military action, the United Kingdom was in effective control of an area outside its territory. Its presence in Iraq in 2005 and 2006 was to provide security and help with the reconstruction effort in that country pursuant to a request by the Iraqi government. The local administration was in the hands of the Iraqi government. Nor are we concerned with the risk of a vacuum in the Convention legal space. The category relevant to this case is that of state agent authority and control, which is described in paras 133 to 137. This category is introduced by para 133, which is in these terms: The Court has recognised in its case law that, as an exception to the principle of territoriality, a contracting states jurisdiction under article 1 may extend to acts of its authorities which produce effects outside its own territory: see Drozd and Janousek v France and Spain (1992) EHRR 745, para 91; Loizidou v Turkey (1995) 20 EHRR 99 (preliminary objections), para 62; Loizidou v Turkey (1997) 23 EHRR 513 (merits), para 52; Bankovic v Belgium (2004) 44 EHRR SE75, para 69. The statement of principle, as it appears in Drozd and the other cases just cited, is very broad: the Court states merely that the contracting partys responsibility can be involved in these circumstances. It is necessary to examine the Courts case law to identify the defining principles. There then follow three paragraphs in which the principles are defined by reference to the Courts case law. The first principle is set out in para 134. It refers to the acts of diplomatic and consular agents, who are present on foreign territory in accordance with provisions of international law. This may amount to an exercise of jurisdiction when these agents exert authority and control over others. The cases cited are X v Federal Republic of Germany (1965) 8 Yearbook of the European Convention on Human Rights 158; X v United Kingdom (1977) 12 DR 73; M v Denmark (1992) 73 DR 193; and Bankovic, para 73, where the Court noted that other recognised instances of the extra territorial exercise of jurisdiction by a state include cases involving the activities of its diplomatic or consular agents abroad and on board craft and vessels registered in, or flying the flag of, that state. In these specific situations, customary international law and treaty provisions have recognised the extra territorial exercise of jurisdiction by the relevant state. The second principle is set out in para 135. It refers to the fact that the Court has recognised the exercise of extra territorial jurisdiction by a contracting state when, through the consent, invitation or acquiescence of the government of that territory, it exercises all or some of the public powers normally to be exercised by that government: Bankovic, para 71. So, where in accordance with custom, treaty or other agreement, authorities of the contracting state carry out executive or judicial functions on the territory of another state, the contracting state may be responsible for breaches of the Convention that result from their exercise, so long as the acts in question are attributable to it rather than to the state in whose territory the acts take place. The cases cited are Drozd and Janousek v France and Spain (1992) 14 EHRR 745; Gentilhomme v France (Application Nos 48205, 48207 and 48209), given 14 May 2002; and X and Y v Switzerland (1977) 9 DR 57. The third principle is set out in para 136. It refers to the fact that the Courts case law demonstrates that in certain circumstances the use of force by a states agents operating outside its territory may bring the individual thereby brought under control of the states authorities into the states article 1 jurisdiction. Four examples are given of the application of this principle to cases where an individual was taken into the custody of state agents abroad: calan v Turkey (2005) 41 EHRR 985, where an individual was handed over to Turkish officials outside the territory of Turkey by officials from Kenya; Issa v Turkey (2004) 41 EHRR 567, where the Court indicated in paras 74 77 that if it had been established that Turkish soldiers had taken the shepherds into custody in a nearby cave in Northern Iraq and executed them, the deceased would have been within Turkish jurisdiction by virtue of the soldiers authority and control over them; Al Saadoon v United Kingdom (2009) 49 EHRR SE95 where the Court held that two Iraqi nationals detained in a British controlled prison in Iraq fell within the jurisdiction of the United Kingdom as the United Kingdom exercised total control over the prison and the individuals detained in them; and Medvedyev v France (2010) 51 EHRR 899, where crew members of a Cambodian registered merchant ship suspected of drug smuggling were taken into custody and detained on a French frigate while it was taken to France. A more recent example of the application of the same principle is to be found in Jamaa v Italy (2012) 55 EHRR 627, where the applicant asylum seekers were detained on an Italian ship after their vessels had been intercepted by the Italian Revenue Police and Coastguard. The following words are set out at the end of para 136 which sum up the essence of the general principle: The Court does not consider that jurisdiction in the above cases arose solely from the control exercised by the contracting state over the buildings, aircraft or ship in which the individuals were held. What is decisive in such cases is the exercise of physical power and control over the person in question. The description of the category of state agent authority and control concludes with an important statement in para 137. It is in these terms: It is clear that, whenever the state through its agents exercises control and authority over an individual, and thus jurisdiction, the state is under an obligation under article 1 to secure to that individual the rights and freedoms under section 1 of the Convention that are relevant to the situation of that individual. In this sense, therefore, the Convention rights can be divided and tailored . I do not read the first sentence of this paragraph as adding a further example to those already listed in paras 134 136. No further cases are cited in support of it, which the Court would have been careful to do if that were the case. The point that the Grand Chamber was making in para 137, as is made clear by the last sentence, is that the package of rights in the Convention is not indivisible, as Bankovic, para 75, which is cited here, appeared to indicate. The Grand Chamber had stated in that paragraph of its judgment in Bankovic that it was of the view that the wording of article 1 did not provide any support for the applicants suggestion that the positive obligation in article 1 to secure the rights and freedoms defined in section 1 of this Convention can be divided and tailored in accordance with the particular circumstances of the extra territorial act in question. The effect of para 137 of the Al Skeini judgment is that this proposition, which informed much of the thinking of the House of Lords in Al Skeini (HL) and of the majority in Catherine Smith, that the rights in Section 1 of the Convention are indivisible, is no longer to be regarded as good law. The extra territorial obligation of the contracting state is to ensure the observance of the rights and freedoms that are relevant to the individual who is under its agents authority and control, and it does not need to be more than that. The dividing and tailoring concept relative to the situation of the individual was applied in the Hirsi Jamaa case to resolve the issue whether the asylum seekers were subject to the jurisdiction of Italy while they were detained on the ship flying the Italian flag: 55 EHRR 627, para 74. The second part of the judgment of the Grand Chamber applies the principles described in the first part to the facts of the case. The state of affairs in Iraq during the period when the applicants deaths at the hands of British forces occurred is reviewed in paras 143 to 148. They were killed on various dates between May and September 2003. This was during a period when the United States and the United Kingdom were exercising the powers of government for the provisional administration of Iraq through a Coalition Provisional Authority, which had been created for the purpose in May 2003. They included the maintenance of civil law and order. That remained the position until 28 June 2004, when full authority for governing Iraq passed from the Coalition Provisional Authority to the Interim Iraqi Government. In the light of these facts the Court held in para 149 that the United Kingdom, through its soldiers engaged in security operations in Basra during the period in question, exercised authority and control over individuals killed in the course of such security operations. This established a jurisdictional link between the deceased and the United Kingdom for the purposes of article 1 of the Convention. The Court does not say which of the general principles led it to this conclusion, but it is reasonably clear that the facts come closest to those referred to in para 135. The United Kingdom was not exercising public powers through the consent, invitation or acquiescence of the government of Iraq as during the relevant period no such government was in existence. But it was exercising powers normally to be exercised by that government had it existed. The case thus fell within the general principle of state authority and control. It should be noted, however, that the situation in Iraq had changed by the time the incidents that have given rise to the Snatch Land Rover claims occurred. These incidents took place on 16 July 2005 and 28 February 2006. By that stage the occupation of Iraq had come to an end and the Coalition Provisional Authority had ceased to exist. Full authority for governing the country had passed to the Interim Iraqi Government. The United Kingdom was no longer exercising the public powers normally to be exercised by that countrys government. (c) discussion The question whether at the time of their deaths Pte Hewett and Pte Ellis were within the jurisdiction of the United Kingdom for the purposes of article 1 of the Convention does not receive a direct answer from the Grand Chamber in its Al Skeini judgment. This is not surprising, as that was not the question it had to decide. As it made clear in para 132, the question whether the state was exercising jurisdiction extra territorially in any given case must be determined with reference to the particular facts of that case. But the insertion of the words to date at the beginning of that paragraph indicate that one should not be too troubled by the fact that no case has yet come before the Strasbourg court which required it to consider whether the jurisdiction which states undoubtedly have over their armed forces abroad in both national and international law means that they are within their jurisdiction for the purposes of article 1 of the Convention. Care must, of course, be exercised by a national court in its interpretation of an instrument, the correct interpretation of which can be authoritatively expounded only by the Strasbourg court: R (Ullah) v Special Adjudicator [2004] UKHL 26, [2004] 2 AC 323, para 20 per Lord Bingham. He had already acknowledged in Brown v Stott [2003] 1 AC 681 that, as an important constitutional instrument, the Convention was to be seen as a living tree capable of growth and expansion within its natural limits (Edwards v Attorney General for Canada [1930] AC 124 at p 136 per Lord Sankey LC). But he said that those limits will often call for very careful consideration. As he put it at the end of para 20 in Ullah, the duty of national courts is to keep pace with the Strasbourg jurisprudence as it evolves over time. Lord Binghams point was that Parliament never intended by enacting the Human Rights Act 1998 to give the courts of this country the power to give a more generous scope to the Convention rights than that which was to be found in the jurisprudence of the Strasbourg court. To do so would have the effect of changing them from Convention rights, based on the treaty obligation, into free standing rights of the courts own creation. In Al Skeini (HL), paras 105 106, Lord Brown of Eaton under Heywood saw a greater danger in the national court construing the Convention too generously in favour of an applicant than in construing it too narrowly. The question before us here, however, is not one as to the scope that should be given to the Convention rights, as to which our jurisprudence is still evolving. It is a question about the states jurisdictional competence under article 1. In this context, as the question of jurisdiction is so fundamental to the extent of the obligations that must be assumed to have been undertaken by the contracting states, the need for care is all the greater. In Catherine Smith, para 93, I endorsed the view expressed by Lord Brown in Al Skeini (HL), para 107 that article 1 should not be construed as reaching any further than the existing Strasbourg jurisprudence clearly shows it to reach. I would take that as being for us, as a national court, the guiding principle. It seems to me that three elements can be extracted from the Grand Chambers Al Skeini judgment which point clearly to the conclusion that the view that was taken by the majority in Catherine Smith that the states armed forces abroad are not within its jurisdiction for the purposes of article 1 can no longer be maintained. The first is to be found in its formulation of the general principle of jurisdiction with respect to state agent authority and control. The whole structure of the judgment is designed to identify general principles with reference to which the national courts may exercise their own judgment as to whether or not, in a case whose facts are not identical to those which have already been held by Strasbourg to justify such a finding, the state was exercising jurisdiction within the meaning of article 1 extra territorially. While the first sentence of para 137 does not add a further example of the application of the principle to those already listed in paras 134 136, it does indicate the extent to which the principle relating to state agent authority and control is to be regarded as one of general application. The words whenever the state through its agents exercises control and authority over an individual, and thus jurisdiction, can be taken to be a summary of the exceptional circumstances in which, under this category, the state can be held to be exercising its jurisdiction extra territorially. As I said in para 30, above, the word exceptional does not set an especially high threshold for circumstances to cross before they can justify such a finding. It is there simply to make it clear that, for this purpose, the normal presumption that applies throughout the states territory does not apply. Lord Collinss comment in Catherine Smith, para 305, that other bases of jurisdiction are exceptional and require special justification should be understood in that sense. The second is to be found in the way, albeit with a degree of reticence, that this formulation resolves the inconsistency between Issa v Turkey and Bankovic on the question whether the test to be applied in these exceptional cases can be satisfied by looking only at authority and control or is still essentially territorial. The problem that was created by this inconsistency was articulated most clearly by Lord Rodger in Al Skeini (HL), paras 71 75. How can one reconcile the decision in Bankovic, which showed that an act which would engage the Convention if committed on the territory of a contracting state does not ipso facto engage the Convention if carried out by that contracting state on the territory of another state outside the Council of Europe, with the test that was described in Issa that required the court to ascertain whether the deceased were under the authority and control of the respondent state? We now know that Issa cannot be dismissed as an aberration because, as Lord Collins said in Catherine Smith, para 307, it is inconsistent with Bankovic. It is Bankovic which can no longer be regarded as authoritative on this point. The fact that Issa is included in para 136 as one of the examples of cases that fall within the general principle of state agent authority and control is particularly noteworthy. It anchors that case firmly in the mainstream of the Strasbourg courts jurisprudence on this topic. The third is to be found in the way that the Grand Chamber has departed from the indication in Bankovic that the package of rights in the Convention is indivisible and cannot be divided and tailored to the particular circumstances of the extra territorial act in question. It was always going to be difficult to see how, if that was to be the guiding principle, it could be possible to accept that a states armed forces abroad in whatever circumstances were within their jurisdiction for the purposes of article 1 as its ability to guarantee the entire range of the Convention rights would in many cases be severely limited. The problem was solved in the case of the actions of Turkish soldiers in northern Cyprus because the Convention rights were also engaged by the acts of the local administration which survived by virtue of Turkish military and other support: Cyprus v Turkey (Application No 25781/94), given 10 May 2001, para 77. Other cases were likely to be more difficult, and Lord Collins recognised in Catherine Smith, para 302 that cases such as Markovic v Italy (2006) 44 EHRR 1045 suggested that some qualification would have to be made to the principle of indivisibility of Convention rights. The Grand Chamber has now taken matters a step further. The concept of dividing and tailoring goes hand in hand with the principle that extra territorial jurisdiction can exist whenever a state through its agents exercises authority and control over an individual. The court need not now concern itself with the question whether the state is in a position to guarantee Convention rights to that individual other than those it is said to have breached: see Jamaa v Italy 55 EHRR 627. There is one other point arising from the Grand Chambers Al Skeini judgment that should not pass unnoticed. The Equality and Human Rights Commission points out in para 49 of its written case that the anterior question that presents itself in state agent cases is whether the state agent himself is within his states jurisdiction within the meaning of article 1. As Lord Mance observed in Catherine Smith, para 188, to the extent that a states extra territorial jurisdiction over local inhabitants exists because of the authority and control that is exercised over them, this is because of the authority and control that the state has over its own armed forces. It would seem to follow therefore that an occupying state cannot have any jurisdiction over local inhabitants without already having jurisdiction over its own armed forces, in each case in the sense of article 1 of the Convention. That this is so has never been questioned by the Strasbourg court, and it may be said that it is the premise from which extra territorial jurisdiction based on state agent authority and control has been developed. In Cyprus v Turkey (1975) 2 DR 125, which appears to have been the first case in which the concept of state agent authority and control was mentioned (see Al Skeini, para 121), the European Commission of Human Rights observed at p 136, para 8, that authorised agents of a state, including diplomatic or consular agents and armed forces, not only remain under its jurisdiction when abroad but bring other persons or property within the jurisdiction of that state, to the extent that they exercise authority over such person or property. In so far as, by their acts or omissions, they affect such persons or property, the responsibility of the state is engaged. The same formulation is to be found in the Commissions decisions in W v Ireland (1983) 32 DR 211, 215 and Vearncombe v Germany and United Kingdom (1989) 59 DR 186, 194. It no longer appears in references by the Strasbourg court to the acts of diplomatic and consular agents present on foreign territory in accordance with provisions of international law: see X and Y v Switzerland 9 DR 57, para 2; Bankovic, para 73; Al Skeini, para 134. But it has never been disapproved. It was quoted without comment or criticism in Chrysostomos v Turkey (1991) 34 Yearbook of the European Convention on Human Rights 35, para 32. The Grand Chamber in Al Skeini was referred by the applicants to the same passage in the Cyprus judgment: see para 121. The quotation from it in that paragraph includes the proposition that authorised agents of a state remain under its jurisdiction when abroad. The Grand Chamber had the opportunity to say that there was something wrong with it, but it did not do so. The Cyprus case was referred to by Lord Phillips in Catherine Smith, paras 49 50. He did not attach any significance to it, as it seemed to him that the reasoning of the Commission was far wider than that of the Court when it dealt with Turkeys jurisdiction in Northern Cyprus in Loizidou v Turkey (1995) 20 EHRR 99. It receives a passing mention also by Lord Collins in para 249 in the course of a brief review of the cases on acts of diplomatic and consular officials abroad. As matters now stand, given the guidance that has now been given in Al Skeini, it deserves more attention. The logic which lies behind it, as explained by Lord Mance in Catherine Smith, para 188, is compelling. It is plain, especially when one thinks of the way the armed forces operate, that authority and control is exercised by the state throughout the chain of command from the very top all the way down to men and women operating in the front line. Servicemen and women relinquish almost total control over their lives to the state. It does not seem possible to separate them, in their capacity as state agents, from those whom they affect when they are exercising authority and control on the states behalf. They are all brought within the states article 1 jurisdiction by the application of the same general principle. In Demir and Baykara v Turkey (Application No 34503/97), given 12 November 2008, para 74, the Grand Chamber said that in a number of judgments it had used, for the purposes of interpreting the Convention, intrinsically non binding instruments of Council of Europe organs, in particular recommendations and resolutions of the Committee of Ministers and the Parliamentary Assembly. These resolutions and recommendations constitute agreements within the meaning of article 31(3)(a) of the Vienna Convention, account of which may be taken in the interpretation of a treaty or the application of its provisions. It is therefore worth noting recommendation 1742 (2006) of the Parliamentary Assembly on the human rights of members of the armed forces of 11 April 2006, which was made in the light of a debate on a report on this issue of its Committee on Legal Affairs and Human Rights (doc 10861). In para 2 of recommendation 1742 the point was made that members of the armed forces are citizens in uniform who must enjoy the same fundamental freedoms and the same protection of their rights and dignity as any other citizen, within the limits imposed by the specific exigencies of military duties. In para 3 it was emphasised that members of the armed forces cannot be expected to respect humanitarian law and human rights in their operations unless respect for human rights is guaranteed within the army ranks. The Parliamentary Assembly recommended that the Committee of Ministers should prepare and adopt guidelines in the form of a new recommendation to member states designed to guarantee respect for human rights by and within the armed forces. A draft recommendation prepared by a steering committee was adopted by the Committee of Ministers on 24 February 2010 with an explanatory memorandum (CM/Rec (2010) 4) in which it was stated that member states should, so far as possible, apply the principles set out in the recommendation to their armed forces in all circumstances, including in time of armed conflict. The conclusion which I would draw from the jurisprudence of the Strasbourg court derives further support from these non binding recommendations. For these reasons I would hold that the decision in Catherine Smith should be departed from as it is inconsistent with the guidance that the Grand Chamber has now given in its Al Skeini judgment. I would also hold that the jurisdiction of the United Kingdom under article 1 of the Convention extends to securing the protection of article 2 to members of the armed forces when they are serving outside its territory and that at the time of their deaths Pte Hewett and Pte Ellis were within the jurisdiction of the United Kingdom for the purposes of that article. To do so would not be inconsistent with the general principles of international law, as no other state is claiming jurisdiction over them. The extent of that protection, and in particular whether the MOD was under a substantive duty of the kind for which the Snatch Land Rover claimants contend, is the question which must now be considered. The article 2 ECHR claims Article 2(1) of the Convention provides as follows: Everyones right to life shall be protected by law. No one shall be deprived of his life intentionally save in the execution of a sentence of a court following his conviction of a crime for which this penalty is provided by law. The relevant guarantee for the purposes of this case is set out in the first sentence. It has two aspects: one substantive, the other procedural. We are not concerned here with the procedural obligation which is implied into the article in order to make sure that the substantive right is effective in practice: see R (Gentle) v Prime Minister [2008] AC 1356, para 5, per Lord Bingham. The Snatch Land Rover claims, details of which are set out in paras 11 and 12, above, are all directed to the substantive obligation, which requires the state not to take life without justification and also, by implication, to establish a framework of laws, precautions, procedures and means of enforcement which will, to the greatest extent reasonably practicable, protect life: R (Middleton) v West Somerset Coroner [2004] UKHL 10, [2004] 2 AC 182, para 2. As Owen J pointed out, these claims involve issues of procurement as well as allegations relating to operational decisions made by commanders: [2011] EWHC 1676 (QB), para 51. (a) preliminary observations Lord Collins said in Catherine Smith, para 308 that to extend the scope of the Convention to armed forces abroad would ultimately involve the courts in issues relating to the conduct of armed hostilities which are essentially non justiciable. That some issues relating to the conduct of armed hostilities are non justiciable is not really in doubt. But in my opinion a finding that in all circumstances deaths or injuries in combat that result from the conduct of operations by the armed forces are outside the scope of article 2 would not be sustainable. It would amount, in effect, to a derogation from the states substantive obligations under that article. Such a fundamental departure from the broad reach of the Convention should not be undertaken without clear guidance from Strasbourg as to whether, and in what circumstances, this would be appropriate. It may be noted in this context that the intervener JUSTICE drew attention to article 15 of the Convention in reply to concerns about the practical consequences of finding that soldiers are within the jurisdiction of the United Kingdom under article 1. It provides that in time of war or other public emergency threatening the life of the nation any High Contracting Party may take measures derogating from its obligations under the Convention to the extent required by the exigencies of the situation. But the phrase threatening the life of the nation suggests that the power to derogate under this article is available only in an exceptional situation of crisis or emergency which affects the whole population and constitutes a threat to the organised life of the community of which the state is composed: Lawless v Ireland (No 3) (1961) 1 EHRR 15, para 28. It will be recalled that in A v Secretary of State for the Home Department [2004] UKHL 56, [2005] 2 AC 68 it was held that the Human Rights Act 1998 (Designed Derogation) Order 2001, which had been made to derogate from the right to personal liberty under article 5(1) to enable the appellants to be detained indefinitely without trial, should be quashed. And in R (Al Jedda) v Secretary of State for Defence (JUSTICE intervening) [2007] UKHL 58, [2008] AC 332, para 38, Lord Bingham said that it was hard to think that the conditions of article 15 could ever be met when a state had chosen to conduct an overseas peacekeeping operation, however dangerous the conditions, from which it could withdraw. He also noted that it had not been the practice of states to derogate in situations such as those in Iraq in 2004 and that as subsequent practice in the application of a treaty may, under article 31(3)(b) of the Vienna Convention, be taken into account in interpreting the treaty it seemed proper to regard the power in article 15 as inapplicable. I do not think therefore that it would be right to assume that concern about the practical consequences in situations such as those with which we are dealing in this case can be answered by exercising the power to derogate. The circumstances in which that power can properly be exercised are far removed from those where operations are undertaken overseas with a view to eliminating or controlling threats to the nations security. The jurisprudence of the Strasbourg court shows that there are other ways in which such concerns may be met. The Strasbourg court has repeatedly emphasised that, when it comes to an assessment of the positive obligations that are to be inferred from the application in any given case of the Convention rights, a fair balance must be struck between the competing interests of the individual and of the community as a whole. It has also recognised that there will usually be a wide margin of appreciation if the state is required to strike a balance between private and public interests and Convention rights: Hristozov v Bulgaria (Application Nos 47039/11 and 358/12), given 13 November 2012, paras 118, 124. That was a case about a refusal to authorise an experimental medicinal product which the applicants had wished to be administered to them. But the competition between the interests of the state and those of the individual is no less acute where issues arise about the risk to life of soldiers in the context of military operations conducted on the states behalf. The challenge this court faces when dealing with the Snatch Land Rover claims is to determine where the boundary lies between the two extremes in the circumstances that the armed forces were facing in Iraq in 2005 and 2006. In Gentle, para 19, I said that the proper functioning of an army in a modern democracy includes requiring those who serve in it to undertake the operations for which they have been recruited, trained and equipped, some of which are inherently dangerous, and that the jurisprudence developed from the decision in Soering v United Kingdom (1989) 11 EHRR 439 about decisions taken in this country to send people abroad to places where they face a real risk of being subjected to torture or to inhuman or degrading treatment or punishment does not apply. The guarantee in the first sentence of article 2(1) is not violated simply by deploying servicemen and women on active service overseas as part of an organised military force which is properly equipped and capable of defending itself, even though the risk of their being killed is inherent in what they are being asked to do. The other side of the coin, as Lord Mance explained in Catherine Smith, para 195, is that there is nothing that makes the Convention impossible or inappropriate of application to the relationship between the state and its armed forces as it exists in relation to overseas operations in matters such as, for example, the adequacy of equipment, planning or training. Lord Rodger recognised in the same case at para 126 that, while a coroner will usually have no basis for considering at the outset that there has been a violation of article 2 where a serviceman or woman has been killed by opposing forces in the course of military operations, new information might be uncovered as the investigation proceeds which does point to a possible violation of the article. He referred to the death of a soldier as a result of friendly fire from other British forces as an extreme example. And, as I said in Catherine Smith, para 105, one must not overlook the fact that there have been many cases where the death of service personnel indicates a systemic or operational failure on the part of the state, ranging from a failure to provide them with the equipment that was needed to protect life on the one hand to mistakes in the way they are deployed due to bad planning or inadequate appreciation of the risks that had to be faced on the other. So failures of that kind ought not to be immune from scrutiny in pursuance of the procedural obligation under article 2 of the Convention. The extent to which the application of the substantive obligation under article 2 to military operations may be held to be impossible or inappropriate will, however, vary according to the context. Military operations conducted in the face of the enemy are inherently unpredictable. There is a fundamental difference between manoeuvres conducted under controlled conditions in the training area which can be accurately planned for, and what happens when troops are deployed on active service in situations over which they do not have complete control. As Lord Rodger observed in Catherine Smith, para 122, the job of members of the armed forces involves their being deployed in situations where, as they well know, opposing forces will be making a determined effort, and using all their resources, to kill and injure them. The best laid plan rarely survives initial contact with the enemy. The best intelligence cannot predict with complete accuracy how the enemy will behave, or what equipment will be needed to meet the tactics and devices that he may use to achieve his own ends. Speed may be essential if the momentum of an attack is to be maintained or to strengthen a line of defence. But lines of communication may become stretched. Situations may develop where it is simply not possible to provide troops in time with all they need to conduct operations with the minimum of casualties. Things tend to look and feel very different on the battlefield from the way they look on such charts and images as those behind the lines may have available to them. A court should be very slow indeed to question operational decisions made on the ground by commanders, whatever their rank or level of seniority. Then there is the issue of procurement. In A v Secretary of State for the Home Department [2005] 2 AC 68, para 29, Lord Bingham said that the more purely political (in a broad or narrow sense) the question is, the more appropriate it would be for political resolution, and the less likely it is to be an appropriate matter for judicial decision. The allocation of resources to the armed services and as between the different branches of the services, is also a question which is more appropriate for political resolution than it is by a court. Much of the equipment in use by the armed forces today is the product of advanced technology, is extremely sophisticated and comes at a very high price. Procurement depends ultimately on the allocation of resources. This may in turn be influenced as much by political judgment as by the judgment of senior commanders in Whitehall as to what they need for the operations they are asked to carry out. It does not follow from the fact that decisions about procurement are taken remote from the battlefield that they will always be appropriate for review by the courts. This, then, is a field of human activity which the law should enter into with great caution. Various international measures, such as those contained in the 3rd Geneva Convention of 1929 to protect prisoners of war, have been entered into to avoid unnecessary hardship to non combatants. But subjecting the operations of the military while on active service to the close scrutiny that may be practicable and appropriate in the interests of safety in the barrack block or in the training area is an entirely different matter. It risks undermining the ability of a state to defend itself, or its interests, at home or abroad. The world is a dangerous place, and states cannot disable themselves from meeting its challenges. Ultimately democracy itself may be at risk. (b) the Strasbourg authorities Fundamentally, article 2 requires a state to have in place a structure of laws which will help to protect life: Savage v South Essex NHS Trust [2008] UKHL 74, [2009] AC 681, para 19, per Lord Rodger. As he explained, with reference to the European courts discussion of this issue in Osman v United Kingdom (1998) 29 EHRR 245, para 115, the primary duty is to secure the right to life by putting in place effective criminal law offences backed up by law enforcement machinery. But the states duty goes further than that. It may also imply, in certain well defined circumstances, a positive obligation on the authorities to take preventive operational measures to protect the lives of those within their jurisdiction. In para 88 of its judgment in Keenan v United Kingdom (2001) 33 EHRR 913, the court began by reciting the high level of duty of the state to put in place effective criminal law sanctions to deter the commission of offences against prisoners. But that was just part of what Lord Rodger described in para 30 of Savage as the tralatician jurisprudence of the court on positive obligations under article 2. The positive duties on the state operate at various levels, as one idea is handed down to another. There is a lower level, but still general, duty on a state to take appropriate measures to secure the health and well being of prisoners or people who are in some form of detention. This in its turn gives rise, at a still lower level, to two general obligations: Savage, para 36; Rabone v Pennine Care NHS Trust (INQUEST and others intervening) [2012] UKSC 2, para 12, per Lord Dyson; neryildiz v Turkey (2004) 41 EHRR 325, para 89. The first is a systemic duty, to put in place a legislative and administrative framework which will make for the effective prevention of the risk to their health and well being or, as it was put in neryildiz, para 89, effective deterrence against threats to the right to life. Depending on the facts, this duty could extend to issues about training and the procurement of equipment before the forces are deployed on operations that will bring them into contact with the enemy. The second, which is also directly in point in this case, is to ensure that, where there is a real and immediate risk to life, preventative operational measures of whatever kind are adopted to safeguard the lives of those involved so far as this is practicable. The Strasbourg court has not had occasion to examine the extent to which article 2(1) offers protection at any level to a states armed forces when engaged in operations such as those that were being conducted in Iraq in 2005 and 2006. But there are some straws in the wind which may offer some guidance. In Engel v The Netherlands (No 1) (1976) 1 EHHR 647, para 54, in a well known passage, the Court said that, when interpreting and applying the rules of the Convention, the court must bear in mind the particular characteristics of military life and its effect on the situation of individual members of the armed forces. That was a case about the preservation of military discipline, as were en v Turkey (Application No 45824/99), given 8 July 2003) and Grigoriades v Greece (1997) 27 EHHR 464, where it was observed at p 8 that the extent of the protection given to members of the armed forces must take account of the characteristics of military life, the nature of the activities they are required to perform and of the risk that they give rise to. These comments, however brief, do seem to make it clear that it would not be compatible with the characteristics of military life to expect the same standard of protection as would be afforded by article 2(1) to civilians who had not undertaken the obligations and risks associated with life in the military. That is plainly so in the context of the exercise of military discipline over members of the armed forces when they are on active service. It is hard to see why servicemen and women should not, as a general rule, be given the same protection against the risk of death or injury by the provision of appropriate training and equipment as members of the police, fire and other emergency services. But it is different when the serviceman or woman moves from recruitment and training to operations on active service, whether at home or overseas. It is here that the national interest requires that the law should accord the widest measure of appreciation to commanders on the ground who have the responsibility of planning for and conducting operations there. This approach receives some support from Stoyanovi v Bulgaria (Application No 42980/04), given 9 November 2010, where an application was made under article 2(1) by the family of a soldier who had died during a parachute exercise. In paras 59 61 the Court examined the difference between the primary positive obligation under that article to establish a framework of laws and procedures to protect life and the obligation to take preventative operational measures to protect the life of an individual which may be imposed by implication, as it was put in Osman v United Kingdom (1998) 29 EHRR 245, para 115, only in certain and well defined circumstances. In para 59, recalling what was said in para 116 of Osman where the allegation was of a failure to take preventive measures where there was a known risk of a real, direct and immediate threat to the life of an individual posed by another individual, the Court said: Subject to considerations as to the difficulties involved in policing modern societies, the unpredictability of human conduct and the operational choices which must be made in terms of priorities and resources, such an obligation must be interpreted in a way which does not impose an impossible or disproportionate burden on the authorities and which also conforms with the other rights guaranteed by the Convention. In para 61 it observed that positive obligations will vary in their application depending on the context. Having noted that the case concerned an accident during a military training exercise and that parachute training was inherently dangerous but an ordinary part of military duties, it said: Whenever a state undertakes or organises dangerous activities, or authorises them, it must ensure through a system of rules and through sufficient control that the risk is reduced to a reasonable minimum. If nevertheless damage arises, it will only amount to a breach of the states positive obligations if it was due to insufficient regulations or insufficient control, but not if the damage was caused through the negligent conduct of an individual or the concatenation of unfortunate events. That was a case where the state was in control of the situation, as the accident occurred during a training exercise. It was not claimed that any specific risk to the life of the deceased should have been foreseen in advance, nor was it argued that the legislative and administrative framework was defective in any general or systemic sense: paras 62 63. The whole focus of the courts supervision was on the authorities response to the accident. It was not suggested that there could not have been a breach of the general or systemic duties in such a case. There is, however, a sharp contrast between that situation and operations undertaken in a situation where it was known or could reasonably have been anticipated that troops were at risk of attacks from insurgents by unconventional means such as by the planting of IEDs. Regulation and control of the kind contemplated in Stoyanovi is likely to be very difficult, if not impossible, to achieve on the ground in situations of that kind. Even where those directing operations are remote in place and time from the area in which the troops are operating, great care is needed to avoid imposing a burden on them which is impossible or disproportionate. Another example of the Strasbourg courts concern not to impose a disproportionate and unrealistic obligation on the state is provided by Giuliani and Gaggio v Italy (Application No 23458/02), given 24 March 2011. The applicants in that case complained of the death of their son and brother during demonstrations surrounding the G8 summit in Genoa which had degenerated into violence. The Court held that the Italian authorities did not fail in their obligation to do what could reasonably be expected of them to provide the level of safeguards required during operations potentially involving the use of lethal force. It drew a contrast between dealing with a precise and identifiable target and the maintenance of order in the face of possible disturbances spread over the entire city as regards the extent to which the officers involved could be expected to be highly specialised in dealing with the tasks assigned to them. So too, in the case of the armed forces, a contrast can be drawn between their situation in the training area that can be planned for precisely and that which they are likely to encounter during operations when in contact with the enemy. The same approach is indicated by Finogenov v Russia (Application Nos 18299/03 and 27311/03), given 20 December 2011, para 213, where the Court was prepared to give a margin of appreciation to the domestic authorities, in so far as the military and technical aspects of the situation were concerned, in connection with the storming of a theatre in which many people were held hostage by terrorists, even if with hindsight some of the decisions they took might appear open to doubt. The guidance which I would draw from the Courts jurisprudence in this area is that the court must avoid imposing positive obligations on the state in connection with the planning for and conduct of military operations in situations of armed conflict which are unrealistic or disproportionate. But it must give effect to those obligations where it would be reasonable to expect the individual to be afforded the protection of the article. It will be easy to find that allegations are beyond the reach of article 2 if the decisions that were or ought to have been taken about training, procurement or the conduct of operations were at a high level of command and closely linked to the exercise of political judgment and issues of policy. So too if they relate to things done or not done when those who might be thought to be responsible for avoiding the risk of death or injury to others were actively engaged in direct contact with the enemy. But finding whether there is room for claims to be brought in the middle ground, so that the wide margin of appreciation which must be given to the authorities or to those actively engaged in armed conflict is fully recognised without depriving the article of content, is much more difficult. No hard and fast rules can be laid down. It will require the exercise of judgment. This can only be done in the light of the facts of each case. (c) should the claims be struck out? The circumstances of the Snatch Land Rover cases are not precisely analogous to those of any previous case in which the implied positive obligation under article 2 has been imposed, and the allegations made in each of the claimants particulars of claim (see paras 11 and 12, above) are not identical. This is because the explosion in which Pte Hewett was killed occurred more than six months before that which killed Pte Ellis. The claim in Pte Elliss case concentrates on the provision of what is said, in the light of experience, to have been inadequate equipment and a failure to limit his patrol to vehicles which offered better protection or had been fitted with element A. The claims in Pte Hewetts case are less precise and range more widely. But they too extend to criticism of operational decisions taken by those in charge of the patrols as well as to alleged failures in the provision of appropriate vehicles and equipment in the light of the death of L Cpl Brackenbury in similar circumstances seven weeks previously. I am conscious, however, of the fact that these particulars are no more than the briefest outline of the case that the claimants seek to make. Account should also be taken of the fact that the claims were issued in January 2008, in the case of Pte Hewett, and in February 2009, in the case of Pte Ellis. In both cases this was before the judgment was delivered in Stoyanovi v Bulgaria. The European Court has now provided greater clarity as to the approach that should be taken to claims of this kind, as has the discussion about the distinct elements that are to be found in the positive duty to protect life that is to be found in Savage and Rabone. Some of the failures which the claimants allege appear to be of the systemic kind (see para 68, above). Others are of the operational kind that was described in the Osman case, where there was an implied positive obligation to take preventative operational measures to protect those who were at risk of a real, direct and immediate threat to life. Measures of that kind could extend to procurement decisions taken on the ground about the provision of vehicles and equipment, as well as to decisions about their deployment. How precisely the allegations fit into the structure of the duties implied by the article cannot be determined without knowing more about the facts, bearing in mind that it must be interpreted in a way which does not impose an unrealistic or disproportionate burden on the authorities. The overall aim of the courts procedure must be to achieve fairness, and I think that it would be unfair to the relatives of the deceased to apply too exacting a standard at this stage to the way the claims have been pleaded. The circumstances in which the various decisions were made need to be inquired into before it can be determined with complete confidence whether or not there was a breach of the implied positive obligation. The details which are needed to place those circumstances into their proper context will only emerge if evidence is permitted to be led in support of them. This seems to me to be a classic case where the decision on liability should be deferred until after trial. I agree with Owen J that the procurement issues may give rise to questions that are essentially political in nature but that it is not possible to decide whether this is the case without hearing evidence. He said that there was no sound basis for the allegations that relate to operational decisions made by commanders, and for this reason took a different view as to whether they were within the reach of article 2. But it seems to me that these allegations cannot easily be divorced from the allegations about procurement, and that here too the question as to which side of the line they lie is more appropriate for determination after hearing evidence. Much will depend on where, when and by whom the operational decisions were taken and the choices that were open to them, given the rules and other instructions as to the use of equipment under which at each level of command they were required to operate. I would therefore dismiss the MODs appeal against Owen Js decision, which the Court of Appeal found it unnecessary to consider, that none of these claims should be struck out. The claimants are, however, on notice that the trial judge will be expected to follow the guidance set out in this judgment as to the very wide measure of discretion which must be accorded to those who were responsible on the ground for the planning and conduct of the operations during which these soldiers lost their lives and also to the way issues as to procurement too should be approached. It is far from clear that they will be able to show that the implied positive obligation under article 2(1) of the Convention to take preventative operational measures was breached in either case. III. Combat immunity (a) background The Challenger claims proceed on the basis that there is no common law liability for negligence in respect of acts or omissions on the part of those who are actually engaged in armed combat. So it has not been suggested that Lt Pinkstone or anyone else in the Black Watch battle group was negligent. Nor, as his decision to fire was taken during combat, would it have been appropriate to do so. The Challenger claimants concentrate instead on an alleged failure to ensure that the claimants tank and the tanks of the battle group that fired on it were properly equipped with technology and equipment that would have prevented the incident, and an alleged failure to ensure that soldiers were provided with adequate recognition training before they were deployed and also in theatre. Their case is founded entirely on failings in training and procurement. The Ellis claim at common law also raises issues about procurement. The MOD invokes in reply the doctrine of combat immunity, which it says should be given a sufficiently broad scope to cover all acts or omissions that are alleged to have caused death or injury in the course of combat operations. It is plain that the effect of the doctrine, if it applies, would be to remove the issue of liability for negligence from the jurisdiction of the court altogether. But the MOD also submits that, if the court does have jurisdiction, it would not be fair, just or reasonable to impose a duty of care on it to protect the soldiers in such circumstances against death or injury. The justification for these arguments is the same, whichever of the two formulations is adopted. It is that the interests of the state must prevail over the interests of the individual. As Mr Eadie QC for the MOD put it, the fair, just and reasonable test chimes with the doctrine of combat immunity. His appeal against the Court of Appeals decision that the negligence claims should not be struck out was directed primarily to that doctrine. This may be considered to be an application to given facts of the test as to what is fair, just and reasonable. But the structure of the law is important and combat immunity is best thought of as a rule, because once a case falls within it no further thought is needed to determine the question whether a duty of care was owed to the claimant. The scope of this rule deserves attention as a separate issue in its own right. (b) the authorities Combat immunity made its first appearance in Shaw Savill & Albion Co Ltd v Commonwealth (1940) 66 CLR 344. A collision had occurred between HMAS Adelaide and a civilian vessel, the MV Coptic. It took place on 3 December 1940 while the civilian vessel was on a voyage from Brisbane to Sydney. The owners of the civilian vessel claimed that the collision had been caused by negligence on the part of the naval authorities and sought damages. The High Court was adjudicating on the plaintiffs demurrer to the defence and a strike out summons by the Commonwealth. The defence was that, while in the course of actual operations against the enemy, the forces of the Crown are under no duty of care to avoid loss or damage to private individuals. Both applications were dismissed and the case proceeded to trial. The Commonwealth was ultimately found liable on the ground of the captains fault in his navigation of the Adelaide: see Attorney General (New South Wales) v Perpetual Trustee Co Ltd (1952) 85 CLR 237, 252 per Dixon CJ. Dixon J, with whom Rich ACJ and McTiernan J agreed, said in the demurrer proceedings at p 361 that it could hardly be maintained that during an actual engagement with the enemy the navigating officer of a ship of war was under a common law duty to avoid harm to such non combatant ships as might appear in the theatre of operations: To concede that any civil liability can rest upon a member of the armed forces for supposedly negligent acts or omissions in the course of an actual engagement with the enemy is opposed alike to reason and to policy. But the principle cannot be limited to the presence of the enemy or to occasions when contact with the enemy has been established. Warfare perhaps never did admit of such a distinction, but now it would be quite absurd. The development of the speed of ships and the range of guns were enough to show it to be an impracticable refinement, but it has been put out of question by the bomber, the submarine and the floating mine. The principle must extend to all active operations against the enemy. At p 362 he acknowledged that it might not be easy under conditions of modern warfare to say in a given case upon which side of the line an act or omission falls. But the uniform tendency of the law had been to concede to the armed forces complete legal freedom in the field, that is to say in the course of active operations against the enemy, so that the application of private law by the ordinary courts may end where the active use of arms begins. Starke J said at pp 355 356 that acts done in the course of operations of war are not justiciable and that this had been decided by Ex P D F Marais [1902] AC 109, where the Judicial Committee of the Privy Council applied the test of whether actual war was raging at the time of the incident. In Groves v Commonwealth (1982) 150 CLR 113, para 3 Gibbs CJ said that he had no difficulty in accepting the correctness of what was said by Dixon J: To hold that there is no civil liability for injury caused by negligence of persons in the course of an actual engagement with the enemy seems to me to accord with common sense and sound policy. In Mulcahy v Ministry of Defence [1996] QB 732 Neill LJ said at p 746 that it seemed to have been recognised in the Australian cases that warlike activities fell into a special category. He concluded at p 748 that an English court should approach a claim of negligence by a soldier who was injured while a gun of whose team he was a member was fired into Iraq during the first Iraq war in the same way as in the High Court of Australia did in the Shaw Savill case. At pp 749 750 he examined what the position would have been, in the absence of the Australian cases, as to whether it would have been fair, just or reasonable to impose a duty of care on one soldier in his conduct to another when engaging the enemy during hostilities. Echoing the words of Gibbs CJ in Groves, he reached the same conclusion, as there was no duty on the defendants in battle conditions to maintain a safe system of work. Sir Iain Glidewell said at p 751 that at common law one soldier does not owe a duty of care to another member of the armed forces when engaging the enemy in the course of hostilities. In his judgment in this case, at para 93, Owen J referred to his judgment in Multiple Claimants v The Ministry of Defence [2003] EWHC 1134 (QB) in which he drew from the cases the proposition that the immunity is not limited to the presence of the enemy or the occasions when contact with the enemy has been established. It extends to all active operations against the enemy in which service personnel are exposed to attack or the threat of attack, including the planning and preparation for the operations in which the armed forces may come under attack or meet armed resistance. He qualified the latter part of this proposition by saying that the extension of the immunity to the planning of and preparation for military operations applied to the planning of and preparation for the operations in which injury was sustained, and not to the planning and preparation in general for possible unidentified further operations. (c) discussion: combat immunity There is not much by way of close reasoning in Shaw Savill and Groves, apart from assertions that where combat immunity applies the doctrine is justified by reason and policy. But the doctrine itself, as explained in Mulcahy, is not in doubt. The question is as to the extent of the immunity. With great respect, I doubt the soundness of the extension of it that in the Multiple Claimants case Owen J drew from the very few cases on this topic. They included Burmah Oil Co Ltd v Lord Advocate [1965] AC 75, where the House held that the destruction of oil installations to avoid their falling into the hands of the enemy did not fall into the category of damage done during the course of battle. That was a very unusual case, which does not really bear on the issue we have to decide. It seems to me that the extension of the immunity to the planning of and preparation for the operations in which injury was sustained that the judge seems to have favoured is too loosely expressed. It could include steps taken far away in place and time from those operations themselves, to which the application of the doctrine as a particular application of what is just, fair and reasonable would be at the very least questionable. Such an extension would also go beyond the situations to which the immunity has so far been applied. In Bici v Ministry of Defence [2004] EWHC 786 (QB), para 90, Elias J noted that combat immunity was exceptionally a defence to the government, and to individuals too, who take action in the course of actual or imminent armed conflict and cause damage to property or death or injury to fellow soldiers or civilians. It was an exception to the principle that was established in Entick v Carrington (1765) 19 State Tr 1029 that the executive cannot simply rely on the interests of the state as a justification for the commission of wrongs. In his opinion the scope of the immunity should be construed narrowly. That approach seems to me to be amply justified by the authorities. The Challenger claims are about alleged failures in training, including pre deployment and in theatre training, and the provision of technology and equipment. They are directed to things that the claimants say should have been done long before the soldiers crossed the start line at the commencement of hostilities. The equipment referred to consists of target identity devices to provide automatic confirmation as to whether a vehicle is a friend or a foe, and situation awareness equipment that would permit tank crews to locate their position and direction of sight accurately. The claim is that, if the Challenger II tanks that were involved in this incident had been provided with this equipment before they went into action, the claimants tank would not have been fired on. The training referred to is described as recognition training. It is said that this should have been provided pre deployment and in theatre. Here too the essence of the claim is that these steps should have been taken before the commencement of hostilities. The claimants are careful to avoid any criticism of the actions of the men who were actually engaged in armed combat at the time of the incident. The question which these claims raise is whether the doctrine of combat immunity should be extended from actual or imminent armed conflict to failures at that earlier stage. I would answer it by adopting Elias Js point, with which Owen J agreed in para 99 of his judgment in this case, that the doctrine should be narrowly construed. To apply the doctrine of combat immunity to these claims would involve an extension of that doctrine beyond the cases to which it has previously been applied. That in itself suggests that it should not be permitted. I can find nothing in these cases to suggest that the doctrine extends that far. In the Shaw Savill case the argument for the Commonwealth at the demurrer stage was that at the time of the collision the warship was engaged in active naval operations against the enemy, that those operations were urgently required and necessary for the safety of the realm and that the national emergency called for the taking of the measures that the warship adopted. Both vessels were said to have been proceeding without any navigation or other lights, in pursuance of instructions from the Australian naval authorities which had been authorised to give them as part of the Crowns function of waging war by sea and protecting vessels from enemy action. It was not said where the enemy were, or what exactly the warship was doing when the collision occurred. But the phrase active naval operations against the enemy makes the point that it was assumed that it occurred during, and not before, the vessels engagement in those operations. The fact that the Commonwealth was ultimately found liable at trial suggests that the judge found that at the material time the warship was not, after all, engaged in actual operations against the enemy. The accident in Mulcahys case occurred while the gun was being fired into Iraq during, and not before, the actual engagement with the enemy. Then there is the point that, as was noted in Jones v Kaney [2011] UKSC 13, [2011] 2 AC 398, paras 108 and 161, any extension of an immunity needs to be justified. It has to be shown to be necessary. Starke J observed in the Shaw Savill case at p 354 that not every warlike operation done in time of war is an operation or an act of war. It is to operations or acts of war only that the doctrine extends, on the ground that the armed forces must be free to conduct such operations without the control or interference of the courts of law. As Dixon J said in the same case at p 361, no one can imagine a court undertaking the trial of an issue as to whether a soldier on the field of battle or a sailor fighting on his ship might reasonably be more careful to avoid causing civil loss or damage. The principle, as he described it, is not limited to acts or omissions in the course of an actual engagement with the enemy. It extends to all active operations against the enemy. While in the course of actually operating against the enemy, the armed forces are under no duty of care to avoid causing loss or damage to those who may be affected by what they do. But, as Dixon J also said at p 362, there is a real distinction between actual operations against the enemy and other activities of the combatant services in time of war. He referred by way of example to a warship proceeding to her anchorage or manoeuvring among other ships in a harbour. At that stage no reason was apparent for treating her officers as under no civil duty of care, remembering always that the standard of care is that which is reasonable in the circumstances. The same point can be made about the time when the failures are alleged to have taken place in the Challenger claimants case. At the stage when men are being trained, whether pre deployment or in theatre, or decisions are being made about the fitting of equipment to tanks or other fighting vehicles, there is time to think things through, to plan and to exercise judgment. These activities are sufficiently far removed from the pressures and risks of active operations against the enemy for it to not to be unreasonable to expect a duty of care to be exercised, so long as the standard of care that is imposed has regard to the nature of these activities and to their circumstances. For this reason I would hold that the Challenger claims are not within the scope of the doctrine, that they should not be struck out on this ground and that the MOD should not be permitted, in the case of these claims, to maintain this argument. The Ellis common law claim relates to a different phase of the United Kingdoms engagement in Iraq, but it was a phase during which there was a constant threat of enemy action by insurgents which was liable to cause death or injury. These claims are less obviously directed to things done away from the theatre in which Pte Ellis was engaged at the time of his death: see para 12, above. Their wording suggests that at least some of the failures alleged may have been due to decisions taken by local commanders during active operations on the ground. If that was the situation, it may be open to argument that these claims are within the doctrine. As Moses LJ recognised in the Court of Appeal, para 63, factual issues of that kind must be left for determination at the trial. The information that would be needed for a decision either way is lacking at this stage. As in the case of their claims under article 2 of the Convention, the details that are needed to place the claims in context will only emerge if evidence is permitted to be led in support of them. So I would hold that it would be premature for these claims to be struck out on the ground of combat immunity. I would leave this issue open to further argument in the light of the evidence. (d) discussion: fair, just and reasonable Mr Eadie QC also renewed the argument that was advanced below that the common law claims should be struck out on the ground that it would not be fair, just and reasonable to impose a duty of care at common law to protect against such death or injury as occurred in these cases. He referred, for example, to Van Colle v Chief Constable of Hertfordshire Police [2008] UKHL 50, [2009] AC 225, Brooks v Comr of Police of the Metropolis [2005] UKHL 24, [2005] 1 WLR 1495 and Stovin v Wise [1996] AC 923 in support of this part of his argument. In Brooks, para 30 Lord Steyn affirmed what he described as the core principle in Hill v Chief Constable of West Yorkshire [1989] AC 53, where it was held on grounds of public policy that the police did not owe legal duties to victims or witnesses in the performance of their function in keeping the Queens peace: see also Elguzouli Daf v Commissioner of Police of the Metropolis [1995] QB 335, where Lord Steyn held, also on grounds of public policy, that the Crown Prosecution Service did not owe a duty of care to those whom it was prosecuting; and Hughes v National Union of Mineworkers [1991] ICR 669, where May J held that it would be detrimental to the public interest if police officers charged with deploying of other officers in times of serious public disorder were to have to concern themselves with possible negligence claims from their subordinates. These can all be seen as cases where, for reasons of public policy, it was not fair, just or reasonable for the defendant to be under a duty of care to avoid injury. The closest the cases have come to applying that reasoning to cases involving members of the armed forces is Mulcahy v Ministry of Defence [1996] QB 732, where Neill LJ said at p 750 that there was no duty on the defendants in battle conditions to maintain a safe system of work and Sir Iain Glidewell said at p 751 that one soldier does not owe to another a duty of care when engaged in battle conditions. As in the other cases, the question whether a duty should be held not to exist depends on the circumstances on who the potential claimants are and when, where and how they are affected by the defendants acts. The circumstances in which active operations are undertaken by our armed services today vary greatly from theatre to theatre and from operation to operation. They cannot all be grouped under a single umbrella as if they were all open to the same risk, which must of course be avoided, of judicialising warfare. For these reasons, I think that the question whether the claims in this case fall within the exclusion that was recognised in Mulcahy or any extension of it that can be justified on grounds of public policy cannot properly be determined without hearing evidence. In Van Colle, para 58 Lord Bingham said that one would ordinarily be surprised if conduct which violated a fundamental right or freedom of the individual under the Convention did not find a reflection in a body of law as sensitive to human needs as the common law. So Lord Rodgers observation in Catherine Smith, para 126 that there would be reason to believe that the military authorities may have failed in their article 2 duty if a soldier dies as a result of friendly fire from other British forces is capable of being read across as indicating that the question in the case of the Challenger claims is not whether a duty was owed but whether, on the facts, it was breached. Whether the situation in Iraq at the time of the incidents that gave rise to the Ellis claims was comparable to battle conditions when a nation is at war is a matter that also needs to be investigated. It needs to be emphasised, however, that the considerations mentioned in paras 64 66 and 76 81, above in the context of the claims made under article 2 of the Convention are just as relevant in the context of the common law claims. Close attention must be paid to the time when the alleged failures are said to have taken place, and to the circumstances in which and the persons by whom the decisions that gave rise to them were taken. It will be easier to find that the duty of care has been breached where the failure can be attributed to decisions about training or equipment that were taken before deployment, when there was time to assess the risks to life that had to be planned for, than it will be where they are attributable to what was taking place in theatre. The more constrained he is by decisions that have already been taken for reasons of policy at a high level of command beforehand or by the effects of contact with the enemy, the more difficult it will be to find that the decision taker in theatre was at fault. Great care needs to be taken not to subject those responsible for decisions at any level that affect what takes place on the battlefield, or in operations of the kind that were being conducted in Iraq after the end of hostilities, to duties that are unrealistic or excessively burdensome. The sad fact is that, while members of the armed forces on active service can be given some measure of protection against death and injury, the nature of the job they do means that this can never be complete. They deserve our respect because they are willing to face these risks in the national interest, and the law will always attach importance to the protection of life and physical safety. But it is of paramount importance that the work that the armed services do in the national interest should not be impeded by having to prepare for or conduct active operations against the enemy under the threat of litigation if things should go wrong. The court must be especially careful, in their case, to have regard to the public interest, to the unpredictable nature of armed conflict and to the inevitable risks that it gives rise to when it is striking the balance as to what is fair, just and reasonable. Conclusion For these reasons I would allow the Snatch Land Rover claimants appeal against the decision of the Court of Appeal that the soldiers in these cases were not within the United Kingdoms jurisdiction for the purposes of article 2 of the Convention at the time of their deaths. I would, however, dismiss the MODs application that the Snatch Land Rover claims should be struck out on the ground that the claims are not within the scope of that article. I would dismiss the MODs application that the Challenger claims should be struck out on the ground of combat immunity and on the ground that it would not be fair, just or reasonable to extend the duty of care to those cases. I would also dismiss the MODs cross appeal against the decision of the Court of Appeal to dismiss its application to strike out the Ellis claim based on negligence. LORD MANCE (with whom Lord Wilson agrees) Introduction This first issue is whether soldiers in the British army are within the jurisdiction of the United Kingdom when serving both on and off base in Iraq for the purposes of article 1 of the European Convention on Human Rights. On this issue, I am in complete agreement with Lord Hope. I have nothing to add to what he says in his paragraphs 17 55. On this basis, this case raises once again for consideration the difficult line or inter relationship between national law and substantive Convention rights, to which I referred in Rabone v Pennine Care NHS Trust [2012] UKSC 2; [2012] 2 AC 72, para 121. It is in general terms clear from Strasbourg jurisprudence that article 2 of the Human Rights Convention includes substantive duties on the part of the state, namely (a) a systems or framework duty, viz to establish a framework which is appropriately protective of life and (b) an operational duty, viz in appropriate circumstances, a positive duty to take preventive operational measures to protect an individual whose life is at risk: Watts v United Kingdom (2010) 51 EHRR SE66, para 82. Although the operational duty was said in Osman v United Kingdom (1998) 29 EHRR 245 to apply in certain well defined circumstances, the subsequent recognition of its application in new sets of circumstances (including by this Court in Rabone) leaves its scope uncertain. As Lady Hale notes in Rabone, para 97 99, it is conceivable that the Strasbourg jurisprudence accepts or is moving towards a broad principle that engages article 2 and requires the state to react reasonably in any situation where the state knows or ought to know of a real and immediate threat to human life. It is also unclear how far the two substantive duties are separated, with middle ground between them, or form part of a continuum covering almost every aspect of state activity. In neryildiz v Turkey (2005) 41 EHRR 325, paras 89 90 the Strasbourg court treated the framework duty as indisputably apply[ing] in the particular context of dangerous activities, where special emphasis must be placed on regulations geared to the special features of the activity in question, adding that They must govern the licensing, setting up, operation, security and supervision of the activity and must make it compulsory for all concerned to take practical measures to ensure the effective protection of citizens whose lives might be endangered by the inherent risks. On the other hand, there are some circumstances in which death occurs as a result of the activities of state agents, but article 2 is not engaged. They include casual errors of judgment or acts of negligence (which I described in R (Catherine Smith) v Oxfordshire Assistant Deputy Coroner [2010] UKSC 29; [2011] 1 AC 1, para 201, as operational as opposed to systematic failures), a principle established in the context of medical negligence. The present appeal concerns the operation and application of the principles of common law negligence and of article 2 in a factual context which is very largely uncharted by previous authority. The right approach is I believe to take first the common law position. A primary aspect of the framework duty on states is to have a legislative and administrative framework appropriately protective of life: neryildiz, para 89, quoted in Rabone, para 12. So article 2 naturally directs attention first to the question whether domestic law provides such a framework, including the recourse to compensation for non pecuniary damages which the Strasbourg court has indicated should in principle be available as part of the range of redress where a state is held responsible for a death: Z v United Kingdom (2001) 34 EHRR 97, para 109. The claims I gratefully adopt Lord Hopes summary of the various claims in paras 9 to 12 of his judgment. Some preliminary observations may be made. First, although the Challenger claims are based only on allegations of lack of technology, equipment and/or training, the Particulars of Claim alone show that the factual circumstances of these sad deaths would require examination and that failings on the ground of those with command over the firing tank are in fact held directly responsible for such deaths. In particular, it is alleged that Major McDuff under whose command the firing tank fell was told of the presence of the tanks subsequently fired upon and had such tanks visually identified to him, that he was shown, but refused to accept, the boundaries of responsibility marked on a map which had been given to such tanks and that he failed to communicate any of this information to anyone, with the result that, some 12 hours later, the firing tank wrongly identified the tanks fired on as enemy. Second, the particulars relied upon in Mrs Smiths claim under article 2 include both decisions or omissions on the ground and equipment and tactical decisions at a higher level. Third, the particulars relied upon in the Ellis claims in negligence and/or under article 2 relate mainly at least to equipment and tactical decisions at a higher level (although they also embrace allegations as to what equipment should have been used if available). As pleaded, the complaint regarding the decision to deploy Snatch Land Rovers on the patrol might be read as a complaint about a decision made on the ground. But their case (para 188) explains that it relates to a decision made well away from the heat of battle at a time when the decision maker was neither under attack nor threat of attack. It did not form part of the planning of this particular patrol. Common law The questions arising are (i) the existence and scope of any common law responsibility on the part of the state towards its soldiers, in particular in respect of deaths in active service and (ii) the nature and scope of any common law doctrine of combat immunity. The claimants starting point is that the state owes to its soldiers a general duty to take appropriate measures to secure their safety, like that owed by any other employer, and that it must also answer vicariously for any breach of duty by one soldier killing or injuring another. It is only therefore by virtue of some exceptional immunity that the state can escape liability for breach of any such duty, and the only principle giving any such immunity is a limited principle of combat immunity. That the Crown is in tort generally in the same position as any employer follows from s.2 of the Crown Proceedings Act 1947, providing Liability of the Crown in tort. (1) Subject to the provisions of this Act, the Crown shall be subject to all those liabilities in tort to which, if it were a private person of full age and capacity, it would be subject: (a) in respect of torts committed by its servants or agents; (b) in respect of any breach of those duties which a person owes to his servants or agents at common law by reason of being their employer; and (c) in respect of any breach of the duties attaching at common law to the ownership, occupation, possession or control of property: Provided that no proceedings shall lie against the Crown by virtue of paragraph (a) of this subsection in respect of any act or omission of a servant or agent of the Crown unless the act or omission would apart from the provisions of this Act have given rise to a cause of action in tort against that servant or agent or his estate. However, there is authority that where actual war is raging acts done by the military authorities are not justiciable by the ordinary tribunals: Ex p Marais [1902] AC 109, 114. That was a case of alleged wrongful detention where the Privy Council declared that the principle applied where martial law had been declared, even though the military commander had allowed ordinary courts, before which the claimant might have been brought, to continue in operation. In Burmah Oil Co Ltd v Lord Advocate [1965] AC 75, Lord Reid recognised (at p 110) an exception (to the Crowns liability to pay compensation for property seized or destroyed) in relation to battle damage consisting of accidental or deliberate damage done in the course of fighting operations. In Shaw Savill & Albion Co Ltd v Commonwealth (1940) 66 CLR 344, Ex p Marais was cited by Starke and Williams JJ, but all the members of the High Court also assimilated the question of justiciability with the question whether the state owed a legal duty to take care in the particular circumstances. Starke J stated that it is for the court to determine whether a state of war exists and whether the matters complained of were done or omitted in the conduct of an operation or act of war. He added (consistently with Ex p Marais) that the immunity arising from conduct of war cannot be confined to the theatre of operations where combatants are actively engaged: it must extend, in modern times, to all theatres in which action on the part of the Kings enemies is imminent. In terms of the modern law of tort, the right analysis is, I consider, that combat immunity is not so much an entirely separate principle as the result of a general conclusion that it is not fair, just or reasonable to regard the Crown or its officers, soldiers or agents as under a duty of care to avoid injury or death in their acts or omissions in the conduct of an active military operation or act of war. That is how the matter was seen in Mulcahy v Ministry of Defence [1996] QB 732. The Court of Appeal there, rightly in my view, followed the approach in Shaw Savill in holding that a gun commander firing live rounds into Iraq during the first Gulf War in 1991 owed the claimant, a serving soldier in the same team, no duty of care for breach of which the Ministry could be held vicariously liable. It held equally that the Ministry itself owed the claimant no duty to maintain a safe system of work. Among the points considered in Mulcahy was whether the repeal of the immunity in tort formerly provided by section 10 of the Crown Proceedings Act 1947, subject to the right (never yet utilised) to revive section 10 for all or limited purposes under s.2 of the Crown Proceedings (Armed Forces) Act 1987 bore on the existence or scope of any doctrine of combat immunity. Neill LJ held it did not, because it was still necessary to consider the common law position. I agree. In Bici v Ministry of Defence [2004] EWHC 786 (QB), concerning the killing of two civilians by British soldiers during the course of peace keeping operations in Kosovo, Elias J treated separately the doctrine of combat immunity and the question whether there existed a duty of care, viewing the former as an exclusion of justiciability and so as a doctrine to be strictly confined on constitutional grounds. But on that basis it was still necessary to consider whether any duty of care existed. Elias J held it did, because the case involved the single question whether the soldiers were justified in firing on the civilians, and there was no basis for concluding that they did not owe a duty of care in doing so: Troops he said (para 104) frequently have to carry out difficult and sensitive peace keeping functions, such as in Northern Ireland, whilst still being subject to common law duties of care. The difficulties of their task are reflected in the standard of the duty rather than by denying its applicability. As Lord Hope has noted, the cases on combat immunity are focused on acts or omissions occurring and causing injury or death in the course of hostilities. In the present case the Challenger claimants are careful to put their case in a way which relies solely on allegedly negligent conduct occurring prior to and distant from the actual hostilities, and involving failures, in Whitehall or elsewhere, properly to equip and train the soldiers sent to fight in Iraq. The same applies, at least for the most part, to the Ellis claims. The question is whether the state, or indeed those of its officers responsible for procurement and training decisions, owe any duty of care in respect of injury or death in the course of combat operations allegedly attributable to their negligence in the performance of such responsibility. This is a question of public policy about the answer to which Lord Rodger (at para 127), with whom Lord Walker expressly agreed (at para 131), can, I think, have had no doubt in R (Catherine Smith) v Oxfordshire Assistant Deputy Coroner [2010] UKSC 29, [2011] 1 AC 1. Although they were addressing explicitly the position under article 2, they cannot have thought that their remarks were or could be made irrelevant simply be reformulating a claim in negligence. It is not difficult to identify situations in which the common law has concluded on policy grounds that no duty of care should exist. I agree with all that Lord Carnwath has said in this connection in paras 161 to 175 of his judgment. In Hill v Chief Constable of West Yorkshire [1989] AC 53, the House held that the police had owed no enforceable duty of care with respect to the last victim of the Yorkshire Ripper, properly to investigate the crimes committed by the Yorkshire Ripper before the murder of, and so to save the life of, the last victim. Lord Keith said, at p 63: From time to time they [the police] make mistakes in the exercise of that function, but it is not to be doubted that they apply their best endeavours to the performance of it. In some instances the imposition of liability may lead to the exercise of a function being carried on in a detrimentally defensive frame of mind. The possibility of this happening in relation to the investigative operations of the police cannot be excluded. Further it would be reasonable to expect that if potential liability were to be imposed it would be not uncommon for actions to be raised against police forces on the ground that they had failed to catch some criminal as soon as they might have done, with the result that he went on to commit further crimes. While some such actions might involve allegations of a simple and straightforward type of failure for example that a police officer negligently tripped and fell while pursuing a burglar others would be likely to enter deeply into the general nature of a police investigation, as indeed the present action would seek to do. The manner of conduct of such an investigation must necessarily involve a variety of decisions to be made on matters of policy and discretion, for example as to which particular line of inquiry is most advantageously to be pursued and what is the most advantageous way to deploy the available resources. Many such decisions would not be regarded by the courts as appropriate to be called in question, yet elaborate investigation of the facts might be necessary to ascertain whether or not this was so. A great deal of police time, trouble and expense might be expected to have to be put into the preparation of the defence to the action and the attendance of witnesses at the trial. The result would be a significant diversion of police manpower and attention from their most important function, that of the suppression of crime. Closed investigations would require to be reopened and retraversed, not with the object of bringing any criminal to justice but to ascertain whether or not they had been competently conducted. In Brooks v Comr of Police of the Metropolis [2005] 1 WLR 1495, the House applied similar reasoning when holding that the police have no duty of care not to cause by positive acts or omissions harm to victims of serious crime, or witnesses to serious crime, with whom they have contact. Lord Steyn said (para 30): It is, of course, desirable that police officers should treat victims and witnesses properly and with respect: compare the Police (Conduct) Regulations 2004 (SI 2004/645). But to convert that ethical value into general legal duties of care on the police towards victims and witnesses would be going too far. The prime function of the police is the preservation of the Queen's peace. The police must concentrate on preventing the commission of crime; protecting life and property; and apprehending criminals and preserving evidence: . A retreat from the principle in Hill's case would have detrimental effects for law enforcement. Whilst focusing on investigating crime, and the arrest of suspects, police officers would in practice be required to ensure that in every contact with a potential witness or a potential victim time and resources were deployed to avoid the risk of causing harm or offence. Such legal duties would tend to inhibit a robust approach in assessing a person as a possible suspect, witness or victim. By placing general duties of care on the police to victims and witnesses the police's ability to perform their public functions in the interests of the community, fearlessly and with despatch, would be impeded. It would, as was recognised in Hill's case, be bound to lead to an unduly defensive approach in combating crime. Van Colle v Chief Constable of the Hertfordshire Police (Secretary of State for the Home Department intervening) [2008] UKSC 50, [2009] AC 225 is a further case in which there was in Lord Hopes words a highly regrettable failure to react to a prolonged campaign by Jeffrey threatening the use of extreme criminal violence against Mr Smith, which in the event did culminate in Jeffrey attacking Mr Smith and very severely injuring him. The House again applied the approach in Hill and Brooks in concluding that there was no actionable duty of care. In all these cases the existence of a duty of care was negatived, although it could not be said that the police action or inaction occurred in the heat of the moment and the failings occurred over considerable periods when the police had the opportunity to think about and investigate the position and take protective measures. In Multiple Claimants v Ministry of Defence [2003] EWHC 1134 (QB), it was claimed that the Ministry was in breach of a duty of care to provide service personnel with a safe system of work. Owen J considered (para 2.C.16) that In aggressive operations the objective will be defeat of the enemy; in defensive operations the successful repulse of the enemy. In the planning of and preparation for such operations the interests of service personnel must be subordinate to the attainment of the military objective. In my judgment the military cannot be constrained by the imposition of civil liability in the planning of and preparation for such operations any more than in their execution. The planning of and preparation for military operations will include decisions as to the deployment of resources. On that basis, he dismissed a claim that the Ministry had failed to make proper arrangements for psychiatric support in combat on the basis that Decisions as to the deployment of medical resources in operations in which service personnel may engage in hostilities fall within the combat immunity . (para 10.12). However, he disagreed with the Ministrys more extended submission that no cause of action can arise in relation to injury sustained in combat irrespective of whether the acts or omissions to which such injury is attributable fall within the combat immunity (para 2.C.18). He reiterated his view on this point in his judgment at first instance in the present cases concerning the Challenger and Ellis claims. Mr Eadie QC takes issue with Owen J on the point. However, it was explained by Owen J with an example which suggests that he had in mind a relatively narrow situation not presently relevant. The explanation was in these terms: If the restriction to the duty of care does not arise on the facts, and a claimant is able to demonstrate breach of duty resulting in injury and consequential loss and damage, it is immaterial that the injury was sustained in the course of combat. The question with regard to the injury is then simply one of causation; is it attributable to the breach of duty? The point can be illustrated by reference to the claimants' contention that the MoD was under a duty to devise and implement a system for screening recruits so as, and I paraphrase, to eliminate those vulnerable to stress, and that as a result of breach of that duty recruits who should have been rejected were enlisted, and subsequently sustained psychiatric injury when exposed to the trauma of battle. If that contention is well founded, it will obviously not be open to the MoD to argue that the combat immunity applies to the relevant acts or omissions. The injury will have been sustained in combat; but the exposure to stress in combat is simply the mechanism by which the breach causes injury. In considering the Challenger claims and the Ellis claim for negligence, Owen J referred to his previous decision in Multiple Claimants as well as to Elias Js decision in Bici. He accepted the latter as standing for the proposition that any exception on grounds of combat immunity should be narrowly construed. He confined the extension of the doctrine of combat immunity, recognised in Multiple Claimants, to the planning and preparation of the particular operations in which injury was sustained, as opposed to planning and preparation made . in general for possible unidentified further military operations (para 94). He was not persuaded that the fact that the equipment claims were likely to give rise to issues of procurement and allocation of resources demonstrated conclusively that it would not be fair, just and reasonable to impose the duties of care for which the claimants contend (para 107). He was not persuaded that either the equipment or the claims based on lack of pre deployment training had no real prospect of success. He thought that different considerations might apply to the claims so far as based on lack of in theatre training, but that this issue would be better determined by the trial judge. He struck out the Ellis claim for negligence in para 26.1 (failure to limit patrols to other vehicles) as falling squarely within combat immunity. The Court of Appeal upheld Owen Js conclusion that the equipment and training claims arguably fall outwith the scope of combat immunity, and also allowed the appeal in respect of para 26.1. Three points arise. First, in my opinion, the decisions below underestimate the inevitable inter linking of issues relating to the supply of technology and equipment and to training for active service with decisions taken on the ground during active service. As noted in para 110 above, it is not possible to consider the Challenger claims without considering the conduct of those on the ground. If it were suggested, as might be possible, that the real cause of the incident was the failings of a local commander, the court would, on the claimants case, find itself having to adjudicate on this suggestion in order to establish whether there was any relevant causative failure regarding the prior supply of equipment or training. As Lord Hope notes (para 91), the claimants have, quite naturally, been careful not to make any criticism of those actually engaged on the ground. But that indicates, rather than resolves, the problem. The proper attribution of responsibility cannot depend upon how a claimant frames his case. The Ministry of Defence could itself advance a case that the real cause was not the fault of someone responsible for procurement, but of someone on the ground. In any event, as the present pleadings show, all the facts would be laid before the court, which would have to decide upon causation looking at them as a whole. Allegations about procurement cannot in the case of the Challenger claims be divorced from consideration of the conduct of those using the equipment on the ground. Lord Hope recognises this in paragraph 80, but draws the opposite conclusion to that which I would draw. He considers that all such circumstances must be evaluated with a view to striking a balance between competing considerations (paras 61, 78 80 and 98 99). I would conclude the opposite that all such circumstances are inter related and essentially non justiciable. Second, Mr Hermer QC for the Challenger claimants accepts that tactical decisions, wherever taken, are not actionable. Mr Hermer must on any view be correct, I consider, on this point. But, if so, it opens the question in relation to the Snatch Land Rover claim by Ms and Mrs Ellis whether a complaint of failure to supply a better armoured or equipped vehicle is not really a complaint about tactics. (In contrast to Mr Hermer, Mr Weir QC for the Smith and Ellis claimants would confine combat immunity so narrowly that it could not embrace in the case of the Ellis claimants either a question why allegedly available equipment (Element A) was not fitted to Private Elliss Snatch Land Rover on the day of the casualty or a question why the patrol to the Iraqi police station was not delayed a day or two to enable it to be fitted.) Third, both in that connection and more widely, I consider that Owen J was clearly right to conclude in Multiple Claimants that the military cannot be constrained by the imposition of civil liability in the planning of and preparation for such operations any more than in their execution. The planning of and preparation for military operations will include decisions as to the deployment of resources. I would also refer to cautionary words of Lord Keith in Rowling v Takaro Properties Ltd [1988] AC 473, 502D F: The third [matter] is the danger of overkill. It is to be hoped that, as a general rule, imposition of liability for negligence will lead to a higher standard of care in the performance of the relevant type of act; but sometimes not only may this not be so, but the imposition of liability may even lead to harmful consequences. In other words, the cure may be worse than the disease. The claims that the Ministry failed to ensure that the army was better equipped and trained involve policy considerations of the same character as those which were decisive in Hill, Brooks and Van Colle. They raise issues of huge potential width, which would involve courts in examining procurement and training policy and priorities over years, with senior officers, civil servants and ministers having to be called and to explain their decisions long after they were made. Policy decisions concerning military procurement and training involve predictions as to uncertain future needs, the assessment and balancing of multiple risks and the setting of difficult priorities for the often enormous expenditure required, to be made out of limited resources. They are often highly controversial and not infrequently political in their nature. These may well also be influenced by considerations of national security which cannot openly be disclosed or discussed. Lord Rodger summarised the position in relation to responsibility, accountability and investigation in Catherine Smith (para 127) in terms with which, as I have said, Lord Walker agreed, as I also do: Once it is established, say, that a soldier died because the blast from a roadside bomb penetrated the armour plating on his vehicle, it may well be inferred that he would not have died if the plating had been stronger. And that simple fact may be worth pointing out as a possible guide for the future. But questions, say, as to whether it would have been feasible to fit stronger protection, or as to why the particular vehicles were used in the operation or campaign, or as to why those vehicles, as opposed to vehicles with stronger protection, were originally purchased by the Ministry of Defence, or as to whether it would have been better to have more helicopters available etc, all raise issues which are essentially political rather than legal. That being so, a curious aspect of counsel's submissions before this court was the complete absence of any reference to Parliament as the forum in which such matters should be raised and debated and in which ministers should be held responsible. Of course, in consequence of pressure brought to bear by Parliament, the government might set up an independent inquiry with wide terms of reference to look into all aspects of a situation, including the political aspects. Also in Catherine Smith Lord Brown at para 146 asked rhetorically: Is it really to be suggested that even outside the area of the Council of Europe Strasbourg will scrutinise a contracting state's planning, control and execution of military operations to decide whether the state's own forces have been subjected to excessive risk (risk, that is, which is disproportionate to the objective sought) ? May Strasbourg say that a different strategy or tactic should have been adopted perhaps the use of airpower or longer range weaponry to minimise the risk to ground troops notwithstanding that this might lead to higher civilian casualties? The question was asked in the context of jurisdiction, but, jurisdiction having been established under article 1, both the question and Lord Browns evident scepticism remain relevant. The claimants case is that during or after any war any injured soldier or the relatives or dependants of any soldier killed in combat could sue the state for alleged failures in the preparation or equipping of the armed forces for combat. Logically, if that is so, then a soldier might, even during the war, complain that his or her equipment or training was inadequate and that it would be a breach of the states common law duty of care and/or duties under the Human Rights Convention even to order him or her to go into combat with it. If domestic legislation compelled this, then the soldier could seek relief in the Strasbourg court maybe even interim relief prohibiting the further use or giving of orders to use the allegedly defective equipment. One may also recall the facts of R v Jones (Margaret) [2006] UKHL 16; [2007] 1 AC 136, where protestors sought to disrupt Fairford Airbase in order to prevent intervention in Iraq, and pleaded in defence that they were preventing the international crime of aggression. Pointing to defective equipment and seeking to ban its use could have a considerable disruptive effect. Not only would there be a huge potential diversion of time and effort in litigation of such issues in an area of essential national interest (whether before, during or after hostilities). There must be risks that the threat of exhaustive civil litigation following any active military operation would affect decision making and lead to a defensive approach, both at the general procurement and strategic stages and at the tactical and combat stages when equipment was being deployed. The duties of care owed by soldiers to civilians during peace keeping operations or by the state to its soldiers in peace are not in issue and raise different considerations. I examined some of the cases which the Strasbourg court has decided in this area in para 196 of my judgment in Catherine Smith. When considering whether a duty of care exists, it is always relevant to ask in what context and to avoid what consequences. (Compare in another branch of the law South Australia Asset Management Corporation v York Montague Ltd [1997] AC 191 and Nykredit Mortgage Bank plc v Edward Erdman Group Ltd (No 2) [1997] 1 WLR 1627.) Equipment should at least be safe and training adequate for peacetime training and activities, and its adequacy in the face of enemy action will not be tested in the same way. But procurement and training decisions and priorities are geared primarily to the needs and risks inherent in active military operations, when enemy activity will be aimed at killing British soldiers in as many unexpected ways as possible. It is after a death or injury occurring in such operations that, as the present cases show, questions can be raised as to whether different technology, equipment or training or different decisions regarding deployment and use of equipment like vehicles might not have made all the difference to the incidence of the death or injury. The relevant question for present purposes is therefore whether the state owed a duty of care to avoid the death or injury during the course of active service which actually occurred. It will often not be difficult with hindsight to point to different decisions that might have been made or preparations made. Would the disaster of Isandlwana have been avoided had the army command equipped Lord Chelmsfords forces with the heliograph? Or was the cause the failure to form a laager? Or the deployment of troops over too wide a perimeter? Or the lack of screwdrivers to open the ammunition boxes quickly enough? And would many disastrous casualties of the First World War have been avoided if the War Office had recognised the significance of the proposal for a tank put to it in 1912, 1914 and 1916 by the Australian engineer Lancelot de Mole of whom a post war Commission on Awards to Inventors said in 1919: We consider that he is entitled to the greatest credit for having made and reduced to practical shape as far back as the year 1912 a very brilliant invention which anticipated and in some respects surpassed that actually put into use in the year 1916. It was this claimant's misfortune and not his fault that his invention was in advance of his time, and failed to be appreciated and was put aside because the occasion for its use had not then arisen. Was the fall of Singapore to numerically inferior forces, with the ensuing slaughter and torture, due to culpable failures to fortify the Malay peninsular or landward side of Singapore or to provide armoured vehicles or aircraft to protect both? Or was it due to failures of military commanders on the ground? Or was it inevitable in the context of what Churchill described as our bitter needs elsewhere? To offer as a panacea in relation to these points the injunction that courts should be very cautious about accepting such claims is to acknowledge the problem, but to offer no real solution. Had it been, the same panacea would have been adopted as the solution by the House in Hill, Brooks and Van Colle. My conclusions do not mean that every death or injury occurring in the course of military conflict falls necessarily outside the scope of any duty of care. There will be deaths and injuries occurring during active service which are unconnected with the risks of active combat or which arise, as Owen J recognised was possible (para 123 above), from breaches of duty independent of active combat. An accident arising from a defect in equipment which could just as well have occurred on Salisbury Plain and owed nothing significant to any risk of war would be an example. Private Smiths sad death in Catherine Smith likewise. I consider that that the Challenger claims, which are only in common law negligence, should be struck out in their entirety on the basis that the state owes no such duty of care as alleged with regard to the provision of technology, equipment or training to avoid death or injury in the course of an active military operation. Similarly, with regard to the Ellis claim in negligence, I would hold that there was no such duty of care as alleged regarding the provision of different or differently equipped vehicles or, a fortiori, regarding the deployment on patrol on 28 February 2006 of the Snatch Land Rovers which were deployed. Moses LJ suggested in the Court of Appeal (para 60) that it was necessary to consider the evidence in order to decide when active operations start and when they finish and that Owen J had recognised that the present cases may not fall within the scope of combat immunity. But, so far as this suggests that Owen J doubted whether active operations were afoot at the dates relevant to either the Smith claim (16 July 2005) or the Ellis claim (28 February 2006), it is wrong. No such argument even appears to have been raised before Owen J or before the Court of Appeal, in relation to either claim. Further, in paras 113 114 of his judgment Owen J expressly struck out the Ellis claim, so far as it relied on the failure to limit the patrol, on the basis that combat immunity did apply as at 28 February 2006. Before the Supreme Court, the nearest there is to any suggestion is the elliptical statement made in para 186 of the Ellis case in the context of combat immunity that Private Ellis was not engaged in a major combat operation that had ended in May 2003. He was part of an armed force providing security and stability to a region of Iraq; at the time of his death he was on a patrol returning from a trip to the Iraqi police headquarters in Al Amarah. It is the Ellis claimants case that this activity should be treated as akin to a peace keeping, police or anti terrorist activity so that the ambit of combat immunity should be very tightly constrained around the actual patrol in question. Even that statement does not challenge the existence of a combat operation involving the patrol, and in any event there is no basis for allowing an entirely new point, contrary to the basis on which the matter was put before the judge, to be raised at this stage. I would therefore also hold that the Ellis claim should be struck out in so far as it is made for common law negligence. Article 2 As stated in para 103 above, article 2 is said to involve two substantive obligations: framework and operational. In Stoyanovi v Bulgaria (Application No 42980/04) decided 9 November 2010, the Strasbourg court was concerned with an accidental death in a military training exercise a practice parachute jump during which the deceaseds head hit the aircrafts wheel rendering him unconscious and so unable to open his parachute. The court referred to the operational duty arising, on the authority of Osman v United Kingdom and neryildiz v Turkey, where authorities know or ought to know of a real and immediate risk to life, or of a situation inherently dangerous to life, and to the framework duty in the public health sphere to make regulations compelling hospitals to adopt appropriate measures to protect patients lives and to have an effective independent judicial system to determine the cause of death of patients in hospital and make those responsible accountable. It then went on, at para 61, Positive obligations will vary therefore in their application depending on their context. In the present case, which concerns an accident during a military training exercise, the Court notes that while it may indeed be considered that the armed forces' activities pose a risk to life, this is a situation which differs from those dangerous situations of specific threat to life which arise exceptionally from risks posed by violent, unlawful acts of others or man made or natural hazards. The armed forces, just as doctors in the medical world, routinely engage in activities that potentially could cause harm; it is, in a manner of speaking, part of their essential functioning. Thus, in the present case, parachute training was inherently dangerous but an ordinary part of military duties. Whenever a State undertakes or organises dangerous activities, or authorises them, it must ensure through a system of rules and through sufficient control that the risk is reduced to a reasonable minimum. If nevertheless damage arises, it will only amount to a breach of the State's positive obligations if it was due to insufficient regulations or insufficient control, but not if the damage was caused through the negligent conduct of an individual or the concatenation of unfortunate events (see, for comparison, Kalender v Turkey, Application No 4314/02), 43 47, 15 December 2009). The courts reasoning appears to have been that, in so far as military life is inherently dangerous, there could be no question of any operational duty to prevent that danger. This seems fairly self evident, and is certainly consistent with the Strasbourg courts recognition in other cases of the need to bear in mind the particular characteristics of military life and its effects on the situation of individual members of the armed forces (Engel v The Netherlands (No 1) (1976) 1 EHRR 647, para 54), meaning, for example, also that many acts that would constitute degrading or inhuman treatment in respect of prisoners may not reach the threshold of ill treatment when they occur in the armed forces, provided that they contribute to the specific mission of the armed forces in that they form part of, for example, training for battlefield conditions (Chember v Russia, (Application No 7188/03) (unreported) given 3 July 2008, para 49). However, as the court stated in Stoyanovi, the state must by the same token have a system of rules and sufficient control to reduce the risks to a reasonable minimum. In Kalender v Tutrkey (Application No 4314/02) (unreported) given 15 December 2009, cited by the court, liability under the substantive aspect of article 2, was held to exist in the light of numerous failings in the structure and operation of a railway station, leading to passengers having, without supervision or warning, to disembark and cross a line used by other trains and being killed in the process. Accordingly, it appears that the framework duty may in appropriate circumstances operate at a low level. In domestic contexts where the state is taking armed action affecting or liable to affect third persons, the court has undertaken quite close and in the upshot critical examination of the states conduct. I cited examples in para 196 of my judgment in Catherine Smith: Such cases start with McCann v United Kingdom (1995) I EHRR 97, relating to the shooting by SAS officers of members of the Provisional IRA suspected of planning to attack the Royal Anglian Regiment in Gibraltar, and include Isayeva, Yusupova and Bazayeva v Russia (Applications Nos 57947/00, 57948/00 and 57949/00), 24 February 2005, and Isayeva v Russia (Application No 57950/00), 24 February 2005, relating to the conduct of military operations by the Russian armed forces against Chechen separatist fighters which led to the deaths of civilians. In such cases, it appears that the exigencies of military life go to the standard and performance, rather than the existence of, any Convention duty. The question is whether the Strasbourg court would take a similar attitude to the responsibility of a state for the death of a member of its own armed forces in circumstances alleged to have involved mistaken decisions in the course of an operation or act of war (such as alleged by Mrs Smith in at least paragraphs 26.2 to 26.5 of her claim), or failings in planning or in the equipping or training of such forces (such as alleged by Mrs Smith in paras 26.1 and it seems paras 26.6 and 26.7 of her claim and by the Ellis claimants in probably all three particulars in their para 26). In this connection it is relevant to bear in mind that the Strasbourg court has curtailed the operational duty, so that it does not embrace mere casual acts of negligence, certainly in the field of health care and, as appears logical, in other fields: see my judgment in Catherine Smith, para 201 and the cases there cited, to which can now be added Stoyanovi v Bulgaria (Application No 42980/04), para 61, where the European Court of Human Rights said that a death occurring during an inherently dangerous training activity (parachute jumping) undertaken by a soldier would not involve any breach of article 2 if caused through the negligent conduct of an individual (see para 138 above). Mr Weir QC regretted this qualification as deeply unsatisfactory, and as a manifestation of the fact that (in his words) the search for principle has been called off in this area. An alternative view might be that it would have been better if the Strasbourg court had left the development and application of the law of tort to domestic legal systems, subject to clearly defined criteria, rather than set about creating what amounts in many respects to an independent substantive law of tort, overlapping with domestic tort law, but limited to cases involving death or the risk of death. Be that as it may be, the exception for casual acts of negligence is relevant to show that liability under article 2 can be tailored and limited in what the Strasbourg court regards as appropriate circumstances. In the present circumstances, the question arises whether that the Strasbourg court would regard article 2 in its substantive aspect as making the state liable for the death in combat of one soldier due to alleged negligence of his commander or of another soldier. The prospect of the Strasbourg court reviewing the conduct of combat operations in this way seems to me sufficiently striking, for it to be impossible to give this question a positive answer. If the European Court considers that the Convention requires it to undertake the retrospective review of armed conflicts to adjudicate upon the relations between a state and its own soldiers, without recognising any principle similar to combat immunity, then it seems to me that a domestic court should await clear guidance from Strasbourg to that effect. That leaves for consideration whether the framework duty involves an obligation on the part of the state to exercise due care in the course of planning armed operations, and in equipping and training its armed forces, so as to reduce or limit the risks to life involved in such operations. In my opinion it is not possible to conclude that the Strasbourg court would hold that such matters are justiciable under the Convention, any more than they are at common law. I am not over enamoured of the cautionary warning to this court that the road to Strasbourg is a one way street, which a claimant can tread if this Court has not gone far enough, but which the state cannot tread if this Court goes too far. If it is clear from prior authority or this Court is otherwise confident about what Strasbourg will decide, then we should decide the issue as we believe correct. But in the present very difficult case, two connected considerations lead me to consider that caution is called for. First, having decided that the common law recognises no such duty or care or claims as the claimants advance, we should not lightly conclude, in so important and sensitive an area of national life, that the Strasbourg court would take a different view. Second, since I have no confidence about the scope or application of any positive duties which the Strasbourg court might recognise under article 2 in the area, I believe it would be wrong for this Court to advance way ahead of anything that it has yet decided. It should be for the Strasbourg court to decide whether it will review the procurement and training policy of the British army over recent decades in the context of claims under article 2 for compensation arising from deaths of serving soldiers during active military operations. Support for the view that the Strasbourg court does recognise areas of policy into which the Convention protection does not stretch is afforded by two cases. First, in Taylor v United Kingdom (Application No 23412/94) (unreported) 30 August 1994, the Commission held that article 2 did not require the investigation into the killing by Beverley Allitt, a hospital nurse, of child patients to enquire into the responsibility in the NHS for alleged inadequate systems, resource shortages and weak leadership. In holding the application manifestly ill founded and inadmissible, it stated: The Commission acknowledges that neither the criminal proceedings nor the Inquiry addressed the wider issues relating to the organisation and funding of the National Health Service as a whole or the pressures which might have led to a ward being run subject to the shortcomings apparent on Ward Four. The procedural element contained in article 2 of the Convention however imposes the minimum requirement that where a state or its agents potentially bear responsibility for loss of life, the events in question should be subject to an effective investigation or scrutiny which enables the facts to become known to the public, and in particular to the relatives of any victims. The Commission finds no indication that the facts of this case have not been sufficiently investigated and disclosed, or that there has been any failure to provide a mechanism whereby those with criminal or civil responsibility may be held answerable. The wider questions raised by the case are within the public domain and any doubts which may consequently arise as to policies adopted in the field of public health are, in the Commissions opinion, matters for public and political debate which fall outside the scope of article 2 and the other provisions of the Convention. The second case concerned article 3 of the Convention. In Banks v United Kingdom (2007) 45 EHRR SE2, the ECtHR rejected a claim that article 3 required a public inquiry into allegations of torture and inhuman treatment of prisoners at a UK prison. The Court held that the facts had been sufficiently investigated and that: The wider questions raised by the case as to the background of assaults and the remedial measures apt to prevent any recurrence in a prison in the future are, in the Courts opinion, matters for public and political debate which fall outside the scope of article 3 of the Convention. In my opinion therefore this Court should proceed on the basis that the policy considerations which guide its domestic law in the present area of national interest will find an echo in Strasbourg, and not invade a field which would involve, in the context of claims for civil compensation, extensive and highly sensitive review with the benefit of hindsight the United Kingdoms countrys policies, strategy and tactics relating to the deployment and use of its armed forces in combat. The United Kingdoms performance of its investigatory and procedural duties under article 2 is not in doubt, as attested by the sadly numerous inquests (investigating and recording the circumstances of each death) and the still incomplete Chilcot Enquiry (delayed inter alia it is understood by problems relating to the release or use of documents with national security implications). The issue with which this judgment is concerned is whether deaths and (at common law) injuries in combat fall to be investigated in the civil courts, at whatever level in the armed forces, Whitehall or the government responsibility for them is suggested to arise. The answer I would give is, no. The majority approach I agree with Lord Hope (para 100) about the paramount importance that the work that the armed services do in the national interest should not be impeded by having to prepare for or conduct active operations against the enemy under the threat of litigation if things should go wrong. But I do not consider that the majority approach reflects or meets this imperative. In summary, I understand that this approach: (a) recognises at common law a principle of combat immunity, as excluding liability for negligence in respect of any act or omission on the part of those who are actually engaged in active combat (paragraph 82), since no one can imagine a court undertaking the trial of an issue as to whether a soldier on the field of battle or a sailor on his ship might reasonably be more careful to avoid causing civil loss or damage (para 94); (b) recognises allegations as beyond the reach of article 2 . if they relate to things done or not done when those who might be thought to be responsible for avoiding the risk of death or injury to others were actively engaged in direct contact with the enemy (para 76), and extends this to operational decisions made on the ground by commanders, whatever their rank or level of seniority (para 64); but also; (c) suggests that liability (under the Osman v United Kingdom principle, (1998) 29 EHRR 245, para 115) for failure to take preventative operational measures in the face of a real, direct and immediate threat to life could extend to procurement decisions taken on the ground about the provision of vehicles or equipment, as well as to decisions taken about their deployment (para 78); (d) recognises that the more political (in a broad or narrow sense) a decision, the slower a court should be to impose liability at common law and/or under article 2 (para 65), so that it will easy to find that allegations are beyond the reach of article 2 and do not give rise to liability in common law negligence if they concern decisions that were or ought to have been taken about training, procurement or the conduct of operations . at a high level of command and closely linked to the exercise of political judgment and issues of policy (paras 76 and 99). It is unclear to me whether on this approach liability is said to be beyond the reach of article 2 because of its nature or simply because of an injunction that courts should be very slow to find fault in the areas concerned. Whatever the position in that respect, I see real difficulties in the undefined boundaries and the suggested middle ground between on the one hand (a) and (b) and on the other (d). The suggestion in para 78 that Osman type liability could exist as mentioned in point (c) would also appear liable to extend fault based liability to all aspects of decision making during combat operations. What is the logical distinction between deployment of equipment and of troops? The inter twining of issues of procurement and training with issues relating to the causation of injury or death on the battlefield seems highly likely to lead to a court undertaking the trial of unimaginable issues as to whether a soldier on the field of battle or a sailor on his ship might reasonably have been more careful. Further, I see little attraction in a scheme according to which the acts or omissions of the man on the ground and the policy maker in Whitehall give rise either to no liability at all or only to liability in egregious cases, but the procurement, training and deployment decisions of a middle rank commander (query, in Whitehall or in local headquarters or both) are subject to scrutiny under conventional principles of fault based liability. All depends, as I understand it, under article 2 upon balancing private and public interests and Convention rights (para 61); or upon balancing (i) the need to avoid undermining the ability of a state to defend itself, or its interests, at home or abroad (para 66) and the paramount importance of not impeding the armed forces against (ii) the consideration that (at common law) soldiers injured or (at common law and under the Convention) the relatives and dependants of soldiers killed should be able, wherever possible, to benefit by the more substantial civil measure of recovery that fault based liability brings, over and above the no fault compensation available in cases of injury or death as described by Lord Carnwath in para 181 of his judgment. Still more fundamentally, the approach taken by the majority will in my view make extensive litigation almost inevitable after, as well as quite possibly during and even before, any active service operations undertaken by the British army. It is likely to lead to the judicialisation of war, in sharp contrast with Starke Js dictum in Shaw Savill (1940) 66 CLR 344 that war cannot be controlled or conducted by judicial tribunals. No doubt it would be highly desirable if all disputes with international legal implications were to be submitted to international judicial resolution, with those involved abiding by the outcome; and if wars were no more. But, in the present imperfect world, there is no precedent for claims to impose civil liability for damages on states whose armed forces are killed or injured in armed combat as a result of alleged failures of decision making either in the course of, or in procuring equipment or providing training for, such combat. All the claims made in these appeals fall in my view within one or other of these areas where the common law should not tread. Similarly, we should not assume that the European Court of Human Rights would regard it as appropriate to enter such areas under article 2, and there is to my mind wholly insufficient guidance to lead to any conclusion that it would. We cannot, at least at present, refer a case to Strasbourg to seek its guidance on the proper interpretation of article 2. But my conclusions as to the common law position and its rationale, the dearth of any authority for any like claim in the Strasbourg jurisprudence and statements in that jurisprudence showing that policy decisions can be non justiciable all lead me to conclude that we should for the present proceed on the basis that the outcome in Strasbourg would in the present areas be no different from the outcome at common law. Conclusion The upshot is that, in my opinion, although the soldiers involved in these cases were within the United Kingdoms jurisdiction for the purposes of article 2 of the Convention of Human Rights at the material times, the claims made under article 2 and/or in negligence in respect of their deaths were, in the case of the Smith and Ellis claims, rightly struck out by the courts below and the Ministry of Defences appeal seeking to strike out the Challenger claims should be allowed. LORD CARNWATH Introduction I agree entirely with Lord Hopes treatment of the jurisdiction issue. There is also much with which I agree in his discussion of the substantive issues, in particular his comment (para 100) on the paramount importance that the preparation for and conduct of active operations should not take place under the threat of litigation if things should go wrong. However, in agreement with Lord Mance, I do not think it is an adequate response at this level for us simply to send the claims for trial with general injunctions to exercise great caution or special care. Having heard full argument on all these issues, we should be able to rule whether the claims are in principle viable or not; or at least to give clearer guidance as to what answers to what questions of fact may or may not lead to a favourable result following trial. I also agree with Lord Mance that, contrary to the approach adopted by Lord Hope, we should first concentrate on the common law aspects of the claims. In this respect, the balance of the relevant issues may have been distorted by the sequence of submissions at the hearing. It is understandable, given the importance of the jurisdictional issues arising under the Convention, that much of the oral hearing time was taken up with submissions on that subject, and as a natural extension with arguments about the substantive scope of article 2 itself. On the latter aspect, I have nothing to add to Lord Mances reasoning and conclusions, with which I agree. However, like him, I consider that our primary responsibility should be for the coherent and principled development of the common law, which is within our own control. We cannot determine the limits of article 2. Indeed, the multiplicity of views expressed by the nine members of this court, when this issue was previously considered in Catherine Smith, shows how difficult and unproductive it can be, even at this level, to attempt to predict how Strasbourg will ultimately draw the lines. The trial judge will be in no stronger position. With respect to Lord Hope (para 79), if the problem is a lack of directly relevant guidance from Strasbourg, it is hard to see how, simply by hearing further evidence or finding further facts, he or she will be better able to fill that gap, still less to do so with complete confidence. Common law the nature of the issues It is important to recognise that we are being asked to authorise an extension of the law of negligence (as indeed of article 2), into a new field. We have not been referred to any authority in the higher courts, in this country or any comparable jurisdiction, in which the state has been held liable for injuries sustained by its own soldiers in the course of active hostilities. Further we are concerned only with duties at common law, rather than under statute. As the Court of Appeal recognised [2013] 2 WLR 27 (para 38), statutory regulations governing the responsibilities of the Ministry as employers do not apply outside the United Kingdom. Mr Eadies case, on behalf of the Ministry, was advanced on a broad front. As formulated in his printed case, this involved a root and branch objection to any form of civil liability in this area. It was introduced by a lengthy section headed: The difficulties courts would face grappling with the issues raised in these claims (paras 72 92). Not only were the courts institutionally incompetent to resolve such issues which are essentially matters of political and military judgement; but there are strong reasons both of public policy and democratic accountability for them not seeking to do so. There is some common ground. There is no dispute as to the existence in domestic law of a principle known as combat immunity, relating to decisions and actions in the heat of battle. Furthermore, at the other end of the spectrum Lord Hope accepts, as I understand it, that high level decisions about procurement or conduct of operations are not open to review in the courts. This dichotomy is most clearly stated in his para 76: It will be easy to find that allegations are beyond the reach of article 2 if the decisions that were or ought to have been taken about training, procurement or the conduct of operations were at a high level of command and closely linked to the exercise of political judgment and issues of policy. So too if they relate to things done or not done when those who might be thought to be responsible for avoiding the risk of death or injury to others were actively engaged in direct contact with the enemy. Although this comes as part of his consideration of article 2, he treats it as equally relevant to the common law claims (para 99). On that view, the difference between us is over the extent (if any) of what he calls the middle ground, and whether its boundaries can only be determined after the finding of further facts. Here too the balance of the discussion may have been distorted by the course of the submissions at the hearing. The emphasis of the common law debate was directed mainly to the scope of the combat immunity defence as such, rather than issues arising under the general law of negligence. No doubt reflecting that emphasis, the wider issues are dealt with relatively shortly at the end of Lord Hopes judgment. In my view, however, it is within that broader compass that the solution to these difficult questions must be found if not at this preliminary stage, then following the trial. In truth, the claimants are caught on the horns of a dilemma. The operational phases of the undertaking, which might otherwise under ordinary principles have been expected to give rise to a duty of care (see eg Wade and Forsyth Administrative Law, 10th ed (2009), p 653ff; Craig Administrative Law, 7th ed (2012), p 908ff) are, as the claimants accept, the very phases which are excluded from review by the combat immunity defence. On the other hand the further back in time they seek to direct their challenge so as to include issues of planning, procurement, and training, the more they have to confront the competing principle that discretionary decisions about policy and resources are not justiciable. The issue is whether it is possible to carve out some middle ground of potential liability. The answer to that question raises issues of principle, policy and practicality. Mr Weir QC rightly emphasises that the importance of another policy consideration, the principle that where there is a wrong there should be a remedy, described by Lord Dyson JSC as a cornerstone of our system of justice (Jones v Kaney [2011] UKSC 13; [2011] 2 AC 398, para 113). From that principle he draws the submission that: The default position is one whereby the MoD owes its soldiers an orthodox employers duty of care. So it falls for the MoD to establish that public policy must operate to deny the existence of that recognised duty of care. However, that formulation begs a logically prior question. I agree that it is for the Ministry to make the case for any policy exception to any recognised duty of care. But the scope and content of any such duty of care are themselves matters for determination. In the modern law of negligence, the starting point for determining that issue is the application of the familiar three fold test laid down in Caparo Industries plc v Dickman [1990] 2 AC 605, 618 per Lord Bridge. In that context, the scope of any so called immunity necessarily overlaps with the question, under the third part of that test, whether it is fair, just and reasonable for the law to impose a duty of care at all (see Clerk & Lindsell On Torts 20th ed (2010), para 14 39ff Immunities). As Lord Browne Wilkinson has said: a holding that it is not fair, just and reasonable to hold liable a particular class of defendants whether generally or in relation to a particular type of activity is not to give immunity from a liability to which the rest of the world is subject. It is a prerequisite to there being any liability in negligence at all that as a matter of policy it is fair, just and reasonable in those circumstances to impose liability in negligence. (Barrett v Enfield London Borough Council [2001] 2 AC 550, 559) For that reason I agree with Lord Mance that the scope of combat immunity should now be discussed, not as a separate principle, but as part of the third element of the Caparo analysis. Equally, in my view, we should not see ourselves as necessarily constrained by the limits illustrated by the existing case law on combat immunity, developed in very different circumstances and (until Mulcahy) without reference to the modern law of negligence. Working by analogy In determining whether a duty of care should be imposed in a new factual situation, precedent is an important guide. In Caparo Lord Bridge proposed that the emphasis should be less on the search for underlying general principles, but rather on the development of the law incrementally and by analogy with established categories (ibid p 618, quoting Brennan J. in the High Court of Australia, Sutherland Shire Council v Heyman (1985) 60 ALR 1, 43 44). In the present context, apart from the cases on combat immunity as such (discussed by Lord Hope and Lord Mance) the closest analogies in my view are to be found in two lines of authority: first, the sequence of authorities relating to the immunity of the police, culminating in Van Colle v Chief Constable of the Hertfordshire Police (Secretary of State of the Home Department intervening) [2009] AC 225; secondly, in respect of the issue of breach, assuming an actionable duty of care is established, the cases relating to the law of negligence as applied to the emergency services, in particular to claims by employees. Police immunity On the issue whether a duty of care should be imposed, the most useful parallel in the modern law, in my view, is to be found in the sequence of authorities dealing with the possible liability of the police for alleged negligence in the course of investigating crime. In Hill v Chief Constable of West Yorkshire [1989] AC 53 it was held that for reasons of public policy the police owed no actionable duty of care to a victim in such circumstances. They were said to be immune from actions of this kind (p 64, per Lord Keith). Initial concerns that this approach might conflict with article 6 of the Convention by precluding consideration of the merits of the claim (see Osman v United Kingdom (1998) 29 EHRR 245) were dispelled by the Strasbourg court in Z v United Kingdom (2001) 34 EHRR 97. The Grand Chamber, following the lead of Lord Browne Wilkinson (X (Minors) v Bedfordshire County Council [1995] 2 AC 633,751) accepted the legitimate role of policy in determining the limits of liability: the Court is not persuaded that the House of Lords' decision that as a matter of law there was no duty of care in the applicants' case may be characterised as either an exclusionary rule or an immunity which deprived them of access to court the House of Lords was concerned with the issue whether a novel category of negligence, that is a category of case in which a duty of care had not previously been held to exist, should be developed by the courts in their law making role under the common law. The House of Lords, after weighing in the balance the competing considerations of public policy, decided not to extend liability in negligence into a new area. In so doing, it circumscribed the range of liability under tort law. (para 96, emphasis added) Echoing that approach, in Brooks v Comr of Police of the Metropolis [2005] UKHL 24; [2005] 1 WLR 1495, the House confirmed but qualified the core principle established in Hill. In his leading speech Lord Steyn said: since the decision of the European Court of Human Rights in Z v United Kingdom (2001) 34 EHRR 97, 138, para 100, it would be best for the principle in Hills case to be reformulated in terms of the absence of a duty of care rather than a blanket immunity. (para 27) Finally, in Van Colle v Chief Constable of the Hertfordshire Police [2009] AC 225, the House by a majority held that the same principle applied even where the police were aware of a specific threat to an individual witness. That is particularly helpful in the present context because it was concerned with the scope of the states liability both at common law and under article 2 of the Convention. I draw the following points from the judgments: The common law claim was to be considered on its own merits i) (stand on its own feet) rather than assimilated with the article 2 claim (para 82, per Lord Hope; para 136, Lord Brown). ii) The common law analysis began from the three fold test laid down in Caparo by which it must be shown that harm to B was a reasonably foreseeable consequence of what A did or failed to do, that the relationship of A and B was one of sufficient proximity, and that in all the circumstances it is fair, just and reasonable to impose a duty of care on A towards B. (para 42, per Lord Bingham). iii) The majority were able to support an exception based on public policy reasons which were accommodated within the third element of that test, that being accepted as a price to be paid by individuals denied for public policy reasons (as not being fair, just and reasonable within the Caparo principle) a civil claim in the interests of the community as a whole (para 139, per Lord Brown) iv) There was no suggestion that, because the core principle involved an exception to ordinary principles of liability, it should be narrowly construed. On the contrary, as Lord Brown put it, the wider public interest is best served by maintaining the full width of the Hill principle (para 139). v) The House was able to determine the limits of this principle on the basis of the pleadings. Again I quote Lord Brown (para 140): In common, I think, with all your Lordships, I regards this issue as plainly one which the House should decide one way or the other on the pleaded facts. Either a duty of care arises on these facts or it does not. No useful purpose would be served by allowing the action to go to trial for facts to be found and then for further consideration to be given to the applicable law. vi) Finally, the policy considerations justifying immunity in respect of the polices function of investigating crime were contrasted with civil operational tasks, in relation to which liability had been accepted in some decided cases (Lord Hope, para 79). Those examples were not regarded as undermining the core principle. This line of cases shows that it remains a proper function of the court, faced with a potential clash between public and private interests, to determine as a matter of policy the limits of any actionable duty of care, and to do so at the preliminary stage (see also Jonathan Morgan, Negligence into Battle [2013] CLJ 14, commenting on the Court of Appeals reasoning in the present case). Furthermore, so to determine the limits of liability in negligence in a new area, by balancing competing considerations of public policy, is within the margin allowed to the national courts by Convention law. Lord Hope acknowledges this line of authority, but declines to apply the same approach to the present context (paras 97 98). With respect, I find this difficult to understand. If this was an appropriate exercise in relation to the purely domestic policy concerns arising from police powers of investigation, how much more so in relation to the issues of vital national security raised by the preparation for and conduct of war? Negligence and the emergency services Assuming a duty of care is not excluded under the principles considered so far, the closest analogies are to be found in cases relating to the duties owed by employees to their staff in the context of the delivery of emergency services. King v Sussex Ambulance Service NHS Trust [2002] ICR 1413 contains an authoritative exposition of the relevant principles. The Court of Appeal dismissed a claim related to injuries sustained by an ambulance technician, who was required in the course of an emergency call to help in carrying a patient downstairs. Hale LJ, giving the majority judgment, summarised the relevant law (paras 21 23): The starting point is that an ambulance service owes the same duty of care towards its employees as does any other employer. There is no special rule in English law qualifying the obligations of others towards fire fighters, or presumably police officers, ambulance technicians and others whose occupations in the public service are inherently dangerous: see Ogwu v Taylor [1988] 1 AC 431. Such public servants accept the risks which are inherent in their work, but not the risks which the exercise of reasonable care on the part of those who owe them a duty of care could avoid. An employer owes his employees a duty to take reasonable care to provide safe equipment and a safe system of work, which includes assessing the tasks to be undertaken, training in how to perform those tasks as safely as possible, and supervision in performing them. This was subject to two qualifications: first, the further dimension identified by Denning LJ (Watt v Hertfordshire County Council [1954] 1 WLR 835, 838): It is well settled that in measuring due care you must balance the risk against the measures necessary to eliminate the risk. To that proposition there ought to be added this: you must balance the risk against the end to be achieved. and secondly (citing Colman J in Walker v Northumberland County Council [1995] ICR 702, 712): what is reasonable may have to be judged in the light of the service's duties to the public and the resources available to it to perform those duties In Hughes v National Union of Mineworkers ([1991] 4 All ER 278, cited by Lord Hope, para 97), this approach was taken a stage further so as to deny the existence of a duty of care at all. The claim was by a police officer who had been injured when, in the course of policing a strike at a colliery, he was knocked to the ground by an advancing crowd of pickets. He alleged negligence by the police officers on the day, rather than wider issues relating to police deployment generally or training (p 281a). The claim was rejected. It was held by May J, applying Caparo principles, and following Hill v Chief Constable of West Yorkshire that public policy requires that senior police officers should not generally be liable to their subordinates who may be injured by rioters or the like for on the spot operational decisions taken in the course of attempts to control serious public disorder. That, in my judgment, should be the general rule in cases of policing serious public disorders. (p 288d e). In Multiple Claimants (at para 2.C.17) Owen J treated Hughes as example of the application of the combat immunity defence, noting that it had been cited in that context by the Court of Appeal in Mulcahy v Ministry of Defence [1996] QB 732, ((at pp 747, 751). He was considering the question: Does the immunity apply to anti terrorist, policing and peace keeping operations of the kind in which British forces were engaged in Northern Ireland and in Bosnia? (para 2.C.17) He gave a qualified yes, concluding that the immunity would apply to peace keeping/policing operations in which service personnel are exposed to the attack or threat of attack (para 2.C.20). This interpretation seems open to question. However violent was the situation facing the police during the mineworkers strike, there could be no argument that it had anything to do with the conduct of war, nor was the judges reasoning linked to that group of cases. While I would not wish to question the actual decision in Hughes, it is in my view better seen as an application of King principles in an extreme situation. The decisions in both King and Hughes were concerned with the operations, rather than with prior policy decisions about the nature of the service and the resources to be committed to them, or issues such as procurement and training. To illustrate the possible limits of operational liability in relation to the emergency services, a useful analogy can be found in Rigby v Chief Constable of Northamptonshire [1985] 1 WLR 1242. The police were held liable by Taylor J for damage caused by firing a gas canister into the plaintiffs premises without having fire fighting equipment available. On the other hand (relying on Dorset Yacht Co Ltd v Home Office [1970] AC 1004, and cases following it) the judge rejected a claim based on the failure of the Chief Constable to equip the force with an alternative CS gas device, known as Ferret, which did not carry the same fire risk. In that respect he accepted the submission that the constable was exercising a statutory discretion which could not be impugned if exercised bona fide (pp 1250 1251). That decision, which is cited by Wade (op cit p 656) as an illustration of the policy operational decision, has not as far as I aware been questioned in later authority. Statutory intervention Before drawing some conclusions, and for completeness, although it did not figure prominently in the oral argument, I should address the suggestion that the claim gains at least implicit support from the Crown Proceedings (Armed Forces) Act 1987. In short, it is said, there is no policy reason to extend the scope of immunity beyond acts or omissions occurring in the heat of battle, given that Parliament has now provided a new statutory framework covering both general liability and the means to secure greater protection where exceptionally it is required. It was the Crown Proceedings Act 1947 which opened the way generally to proceedings in tort against the Crown. However, section 10 preserved a specific and precisely defined statutory exception for the armed forces in relation to injury or death on service subject to the conditions outlined in the section, one being a certificate of entitlement to a service pension (see Clerk & Lindsell op cit para 5 08ff). That exclusion was repealed by the 1987 Act, but (by section 2) subject to a power for the Secretary of State to make an order reviving the effect of section 10 in certain circumstances. By section 2(2): The Secretary of State shall not make an order reviving the effect of the said section 10 for any purposes unless it appears to him necessary or expedient to do so (a) by reason of any imminent national danger or of any great emergency that has arisen; or (b) for the purposes of any warlike operations in any part of the world outside the United Kingdom or of any other operations which are or are to be carried out in connection with the warlike activity of any persons in any such part of the world. Although we were not referred by the parties to any background materials relating to that change, the Parliamentary history is of some interest. A written answer by the Secretary of State for Defence explains that it followed a review of the working of section 10 (Hansard HC Deb 08 December 1986 vol 107 cc85 86W). He said: Section 10 was included in the 1947 Act on the grounds that members of the Armed Forces, by the very nature of their profession, undertake hazardous tasks which ordinary members of the public do not. At that time it was believed that this provision would not result in any overall financial penalty against servicemen, because they received benefits, payable regardless of fault, which were in most cases comparable with those which a civilian might expect from the courts. Our review has, however, shown that damages which courts have awarded in some cases of personal injury have now risen to a level which can considerably exceed the benefits which the serviceman receives. The Government have concluded that repeal of section 10 is the only satisfactory course which will remove this disadvantage We shall need to be able to reactivate the provisions of section 10 in the event of impending or actual hostilities or grave national emergency. It was indicated that, while the government did not have time to promote its own legislation within the current programme, it would be ready to support a suitable Bill brought by a private Member. This invitation was taken up by Mr Winston Churchill MP (HC Deb 13 February 1987 vol 110 cc567 609). The Parliamentary Under Secretary of State, welcoming the Bill on the part of the government commented: The Bill seeks to retain the power to reactivate section 10 at a time of great national emergency or in the event of actual or impending hostilities. That is widely accepted by the House. Indeed, I have not heard any hon. Member advocate in the debate that section 10 should not be reimposed in time of war. It is not possible or desirable to draw hard and fast definitions of the circumstances in which the Government might seek to reimpose section 10, but the wording of clause 2 is satisfactory in this respect, making it clear from that the Secretary of State will need to consider it necessary or expedient to make an order to reactivate section 10 by reason of a great national emergency or imminent national danger or in the event of warlike operations or connected activities outside the United Kingdom. We are talking about a grave situation in Britain or elsewhere, and I draw the attention of the House to the fact that the wording of clause 2 to a large extent mirrors the wording of the provisions of the Reserve Forces Act 1980 dealing with the call up of reserves. Although there is no intention to create a formal link between, say, mobilisation and the reimposition of section 10, hon Members will recognise that that gives an indication of the gravity of the circumstances in which reimposition of section 10 would arise. Those passages raise a number of possible issues, on which we have heard no argument, as to either relevance or substance. One indeed might be the scope of phrase warlike activities (cf Reserve Forces Act 1996, s 54) in its possible application to peace keeping operations such as are in issue in the Snatch claims. We cannot resolve those questions within the scope of the arguments we have heard, and it is unnecessary to do so. It should be noted in any event that the provisions for no fault compensation have changed materially since 1987 when that debate took place. The governing legislation is now the Armed Forces (Pensions and Compensation) Act 2004, with the Armed Forces Compensation Scheme made under it. Awards are based on a detailed tariff, which is kept under review, and there is provision for appeal to a specialised tribunal. The scheme was most recently revised in 2011, following a review by Lord Boyce. However, it was not part of Mr Eadies case that the existence of that scheme, or its overlap with the law of negligence, should affect our consideration of the issues before us. In my view these two sets of statutory provisions are no more than neutral, and neither assists in establishing the limits of the duty of care in the present context. It is not argued for the claimants that the 1987 Act impinges in any way on the defence of combat immunity as hitherto understood. At most it is said to be relevant in determining what is fair, just and reasonable under Caparo principles. However, there is nothing in the 1987 Act to suggest that it was intended to inhibit the ordinary, and logically prior, function of the court in determining the limits of potential liability under the law of negligence. It is only in so far as liability is so established that the scope of immunity under the Act becomes relevant. Finally, under this section, it is of interest to note how similar issues have been dealt with in the USA, although again we have not heard any submissions on this aspect. Until 1946 claims against the Federal Government without its consent were barred by the doctrine of sovereign immunity. This position was altered by the Federal Tort Claims Act (FTCA), 28 U.S.C.A 1346(b), which can be seen as the equivalent of the Crown Proceedings Act 1947 in the United Kingdom. The FTCA abrogated sovereign immunity in relation to the Federal Government in most circumstances. However, pursuant to 28 U.S.C.A. 2680(j), the sovereign immunity of the Federal Government is not abrogated in respect of [a]ny claim arising out of the combatant activities of the military or naval forces, or the Coast Guard, during time of war. A further exception relating to injuries incident to service has been developed judicially, known as the Feres doctrine (Feres v United States, 340 U.S. 135 (S.Ct. 1950)). According to a leading textbook (Speiser, Krause and Gans The American Law of Torts (2010) para 17:5): The critical and lasting rationale of the Feres doctrine is the third one the military disciplinary structure. The lawsuit cannot require a civilian court to second guess military decisions [see Stencel Aero Engineering Corp v United States, 431 U.S. 666, 673 (1977)], and the suit cannot conceivably impair essential military discipline [see Chappell v Wallace, 462 U.S. 296, 300, 302, 304 (1983) (such complex, subtle and professional decisions as the composition, training . and control of a military force are essentially professional military judgments]. Despite certain confusion in the broad statements of the courts, and notwithstanding critical comments, the Feres doctrine of denial of recovery has displayed a charmed life and continuing vitality. The cases show that in practice the Feres doctrine has been applied so as to give immunity in a wide range of situations, not directly linked to armed conflict. Conclusions I have discussed these issues at some length, albeit in a minority judgment, because in my view they deserve greater attention than they have been given in the oral argument or the majority judgment. They remain matters which will need to be considered when the case goes to trial. In this respect I do not regard my analysis as conflicting significantly with the majoritys approach. The main difference is that I would have preferred to reach decisions at this stage. In agreement with Lord Mance, and for the same reasons, I would have struck out the Challenger claims. As I have said, in considering the scope of any actionable duty of care relating to the preparation for or conduct of war activities in the modern law of negligence, I do not think we should regard ourselves as constrained by the limits of combat immunity as established in the earlier cases. The proper application of Caparo principles, as illustrated by the sequence of authorities on police liability, enables us to extend and adapt those limits within the scope of the modern law of negligence, and to hold that there is no middle ground of potential liability in relation to the preparation for, or conduct of, war. As I understand Lord Hopes judgment, it leaves the trial judge free, albeit after further factual inquiry, to reach the same conclusion. In my view, differing from Lord Mance in this respect only, we should apply different considerations to the later Snatch claims. They occurred in July 2005 and February 2006, after the time (May 2003) when (as Lord Hope explains: para 1) major combat operations ceased and were replaced by a period of military occupation. Now that the cases are to go to trial, I would not regard consideration of this issue as necessarily constrained by the shape of the arguments in the lower courts or before us. It is not surprising that Owen J drew no such distinction since, as I have noted, he had already held in Multiple Claimants that such operations were in principle within the scope of the combat immunity defence. The Court of Appeal did not address this issue in detail, but as I understand their judgment left it as raising questions of fact to be decided at trial. If as I believe the policy reasons for excluding liability are related to the special features of war or active hostilities, it would be wrong in my view to apply the same approach to peace keeping operations, however intrinsically dangerous. The ordinary principles of negligence, as illustrated by cases such as Hughes and Rigby, can when necessary be sufficiently restrictive to ensure that most such claims, whether relating to advance procurement and training, or decisions on the ground, will be doomed to failure. On the other hand, the pleaded claims in the present cases go further. It is alleged, as I understand, that there was an unjustified failure, following earlier incidents, to take readily available steps to deal with a known and preventable risk. I would not regard such claims as necessarily excluded as a matter of general policy, either at common law or under article 2. Since all the issues will now have to be considered at trial, it is unnecessary and probably undesirable for me to say more.

These proceedings concern three sets of claims which arise out of the deaths of three young British servicemen and the serious injuries of two other young British servicemen in Iraq. The first set (the Challenger claims) arise from a friendly fire incident involving British tanks which caused the death of Cpl Stephen Allbutt and the serious injury of Lance Cpl Daniel Twiddy and Tpr Andrew Julien. They are brought in negligence and allege failures by the Ministry of Defence (the MoD) to properly equip the tanks involved and to give soldiers adequate recognition training. The second set (the Snatch Land Rover claims) arise from the deaths of Pte Phillip Hewett (son of the claimant Susan Smith) and Pte Lee Ellis (father of the claimant Courtney Ellis and brother of the claimant Karla Ellis) by the detonation of improvised explosive devices level with the Snatch Land Rovers in which the soldiers were travelling. The claimants all claim that the MoD breached the implied positive obligation in article 2 of the European Convention on Human Rights (the Convention) to take preventive measures to protect life in the light of the real and immediate risk to life of soldiers who were required to patrol in Snatch Land Rovers. The third (the Ellis negligence claim) is brought by Courtney Ellis in negligence and is based on various alleged failures on the part of the MoD [1 12]. The MoD argued that the Snatch Land Rover claims under article 2 of the Convention should be struck out because at the time of their deaths Pte Hewett and Pte Ellis were not within the jurisdiction of the UK for the purposes of the Convention, and because on the facts as pleaded the MoD did not owe a duty to them at the time of their deaths under article 2. It also argued that the Challenger claims and the Ellis negligence claim should all be struck out (1) on the principle of combat immunity (which operates to exclude liability for negligence in respect of the acts or omissions of those engaged in active operations against the enemy), and (2) because it would not be fair, just or reasonable to impose a duty of care on the MoD in the circumstances of those cases [13]. The High Court and Court of Appeal considered these arguments. The effect of the Court of Appeals judgment was that: (1) the Snatch Land Rover claims under article 2 of the Convention should be struck out because the deceased were outside the jurisdiction of the UK for the purposes of the Convention and there was no basis for extra territorial jurisdiction; and (2) the Challenger claims and the Ellis negligence claim should proceed to trial [15]. The following issues were before the Supreme Court. (1) In relation to the Snatch Land Rover claims, whether at the time of their deaths Pte Hewett and Pte Ellis were within the jurisdiction of the UK for the purposes of the Convention. (2) If they were, whether and if so, the extent to which article 2 imposes positive obligations on the UK with a view to preventing the deaths of its own soldiers in active operations against the enemy. (3) In relation to the Challenger claims and the Ellis negligence claim, whether the allegations of negligence should be struck out because they fall within the scope of combat immunity or because it would not be fair, just or reasonable to impose a duty to take care to protect against death or injury in the circumstances [16]. The Court unanimously holds that, in relation to the Snatch Land Rover claims, Pte Hewett and Pte Ellis were within the UKs jurisdiction for the purposes of the Convention at the time of their deaths. By a majority (Lords Mance, Wilson and Carnwath dissenting), the Court holds that: (i) the Snatch Land Rover claims should not be struck out on the ground that the claims are not within the scope of article 2 of the Convention; and (ii) the Challenger claims and Ellis negligence claim should not be struck out on the ground of combat immunity or on the ground that it would not be fair, just or reasonable to extend the MoDs duty of care to those cases [101]. The effect of the Courts decision is that all three sets of claims may proceed to trial. Issue 1: Convention jurisdiction: In its judgment of July 2011 in the Al Skeini case, the European Court of Human Rights decided that six Iraqi civilians who had died as a result of the actions of British armed forces in Iraq were within the UKs jurisdiction for the purposes of the Convention. The judgment does not answer issue 1 directly, but elements can be extracted from it which point clearly to the conclusion that the Court reaches in this case. It formulates a relatively general principle that extra territorial jurisdiction can exist whenever a state through its agents exercises authority and control over an individual. It also indicated that Convention rights can be divided and tailored to the particular circumstances of the extra territorial act in question, as opposed to being an indivisible package. A states extra territorial jurisdiction over local inhabitants exists because of the authority and control that is exercised over them as a result of the authority and control that the state has over its own armed forces. They are all brought within the states jurisdiction by the application of the same general principle [42 52]. Issue 2: Snatch Land Rover claims under article 2 of the Convention: In this area, the court must fully recognise the wide margin of appreciation to be given to the state and avoid imposing obligations which are unrealistic or disproportionate. But it must give effect to those obligations where it would be reasonable to expect the individual to be protected by article 2. Policy decisions made at a high level of command and things done on the battlefield will fall outside the scope of article 2. But whether claims which are between these two categories are within the scope of article 2 will require the exercise of judgment in the light of the facts of each case [76]. The present claims provide only brief outlines of the claimants cases and they pre date developments in relevant case law on article 2. The circumstances in which the various decisions were made need to be inquired into before it can be determined with complete confidence whether or not there was a breach of article 2. However, given the Courts guidance on the margin of appreciation to be given to the state, it is far from clear that the claimants will be able to demonstrate such a breach [78 81]. Issue 3: Challenger claims and Ellis negligence claim: The doctrine of combat immunity should be construed narrowly and should not be extended beyond its established scope to the planning of and preparation for active operations against the enemy. The Challenger claims are not within the scope of the doctrine because they relate to decisions which are sufficiently far removed from the pressures and risks of active operations against the enemy. The Ellis negligence claim is less obviously directed to things done away from the theatre of battle so it is arguably within the doctrine. It would be premature for these claims to be struck out and the issue should be open to further argument in the light of the evidence [89 96]. The circumstances in which active operations are undertaken by the UKs armed services today vary greatly and cannot all be grouped under a single umbrella as if they were all open to the same risk of judicialising warfare. However, considerations similar to those affecting the Snatch Land Rover claims under article 2 arise in relation to whether it would be fair, just and reasonable to impose a duty of care on the MoD in this area. The question whether the negligence claims in this case entail subjecting the MoD to duties that are unrealistic or excessively burdensome cannot properly be determined without hearing evidence [98 100]. Minority judgments: Lord Mance (with whom Lord Wilson agrees) would have struck out all three sets of claims in their entirety, essentially because they are not suitable for resolution by a court [125 137, 146, 150 152]. For the same reasons, Lord Carnwath would have struck out the Challenger claims. However, he considered that the Snatch Land Rover claims were not necessarily excluded, because major combat operations had ceased by the time of the relevant incidents [156, 186 188].

longest

This appeal concerns the permissibility and in particular compatibility with European Union law and Human Rights Convention rights, of a procedure (conveniently described as a closed material procedure) whereby an applicant and his representatives may be excluded from certain aspects of employment tribunal proceedings on grounds of national security, and a special advocate may represent his interests so far as possible in relation to the aspects closed to him and his representatives. In the relevant employment tribunal proceedings, the appellant, Mr Kashif Tariq, complains that his security clearance as an immigration officer was withdrawn in circumstances involving direct or indirect discrimination on grounds of race and/or religion, and that this was contrary to the Race Relations Act 1976 and the Employment Equality (Religion or Belief) Regulations 2003 (SI 2003/1660). The Home Offices case is that there was no such discrimination, that the decisions taken in relation to Mr Tariq were taken for the purposes of safeguarding national security, and that the order for a closed material procedure made by the Employment Tribunal (on the Home Offices application) on 15 February 2008 was made justifiably and for the same protective purposes. Mr Tariqs challenge to the Employment Tribunals order for a closed material procedure was dismissed by the Employment Appeal Tribunal on 16 October 2009, UKEAT 168/09, [2010] ICR 223 and the Court of Appeal on 4 May 2010 [2010] EWCA Civ 462, [2010] ICR 1034, but it was declared (by the Employment Appeal Tribunals order dated 24 November 2009, upheld in the Court of Appeal) that article 6 of the European Convention on Human Rights requires [Mr Tariq] to be provided with the allegations being made against him in sufficient detail to enable him to give instructions to his legal team so that those allegations can be challenged effectively (a requirement which can conveniently be described as gisting), even if this put the Home Office in the invidious position of having to make difficult decisions about disclosure and whether or how a claim is to be defended: [2010] ICR 1034, para 50, per Maurice Kay LJ. The Home Office appeals to the Supreme Court against the latter conclusion, while Mr Tariq cross appeals against the conclusion that a closed material procedure was permissible. The factual background in more detail Mr Tariq started employment with the Home Office as an immigration officer on 21 April 2003, having received the necessary security clearance on 18 February 2003. On 19 August 2006 he was suspended from duty on basic pay, while consideration was given to the withdrawal of his security clearance, and on 20 December 2006 his clearance was withdrawn. His internal appeal against this decision was dismissed on 9 August 2007, and his further appeal to the Security Vetting Appeals Panel (SVAP) was unsuccessful in January 2011. The background to the Home Offices decisions to suspend and withdraw Mr Tariqs security clearance consists in the arrest of his brother and cousin on 10 August 2006 during a major counter terrorism investigation into a suspected plot to mount a terrorist attack on transatlantic flights. Mr Tariq's brother was subsequently released without charge. Mr Tariq's cousin, Tanvir Hussain, was convicted on 8 September 2008 of conspiracy to murder, having previously also pleaded guilty to two counts of conspiracy to cause explosions and to commit a public nuisance. He is now serving a sentence of life imprisonment. Inquiries were made at the time of the arrests to establish whether or not Mr Tariq was involved in any way with the plot or could be affected by it. No information suggested that Mr Tariq had himself been involved in any terrorism plot, but the Home Office (in grounds of resistance served in the Employment Tribunal proceedings on 6 August 2007 and amplified on 20 December 2007) states that it was concerned in August 2006 that [Mr Tariq] could be vulnerable to an approach to determine if terrorist suspects had been flagged to the authorities or to smuggle prohibited items airside and that its decision to withdraw security clearance in December 2006 was based on [his] close association with individuals suspected of involvement in plans to mount terrorist attacks and on its view that association with such individuals might make him vulnerable to attempts to exert undue influence on [him] to abuse his position. Mr Tariq commenced the employment tribunal proceedings claiming direct or indirect discrimination on grounds of race and/or religion on 15 March 2007. He stated at the outset that he had been advised that his suspension and the withdrawal of his security clearance were because of his perceived association with certain relatives or associates of relatives suspected of association with terrorist activities and the risk of their attempting to exert influence on him to abuse his position. He denied any such association or risk. On 10 July 2007 he provided what he said were (considering, he said, the extremely limited information as to the grounds for his treatment to that date given) the best further particulars possible to give pending disclosure by the Home Office. These particulars alleged, inter alia, that the Home Office had relied upon stereotypical assumptions about him and/or Muslims and/or individuals of Pakistani origin such as susceptibility to undue influence, coercion or brainwashing and had indirectly discriminatory security policies, procedures and methods of investigation. The Home Office in its grounds of resistance denied this and maintains, as stated, that it acted throughout to protect national security. The legislation The Race Relations Act 1976 provides: 1 Racial discrimination (1) A person discriminates against another in any circumstances relevant for the purposes of any provision of this Act if (a) on racial grounds he treats that other less favourably than he treats or would treat other persons; . (lA) A person also discriminates against another if, in any circumstances relevant for the purposes of any provision referred to in subsection (lB), he applies to that other a provision, criterion or practice which he applies or would apply equally to persons not of the same race or ethnic or national origins as that other, but (a) which puts or would put persons of the same race or ethnic or national origins as that other at a particular disadvantage when compared with other persons, (b) which puts or would put that other at that disadvantage, and (c) which he cannot show to be a proportionate means of achieving a legitimate aim. 42 Acts safeguarding national security Nothing in Parts II to IV shall render unlawful an act done for the purpose of safeguarding national security if the doing of the act was justified by that purpose. The Race Relations Act 1976 is the means by which the United Kingdom gives effect to its obligations under Council Directive 2000/43/EC of 29 June 2000 (the Race Directive) implementing the principle of equal treatment between persons irrespective of racial or ethnic origin. On 27 November 2000 Council Directive 2000/78/EC (the Employment Equality Directive) established a general framework for equal treatment in employment and occupation. This led to the making, under section 2 of the European Communities Act 1972, of the Employment Equality (Religion or Belief) Regulations 2003 (the Employment Equality Regulations), prohibiting discrimination on grounds of religion or belief and providing: 3.(1) For the purposes of these Regulations, a person (A) discriminates against another person (B) if (a) on grounds of religion or belief, A treats B less favourably than he treats or would treat other persons; or (b) A applies to B a provision, criterion or practice which he applies or would apply equally to persons not of the same religion or belief as B, but (i) which puts or would put persons of the same religion or belief as B at a particular disadvantage when compared with other persons, (ii) which puts B at that disadvantage, and (iii) which A cannot show to be a proportionate means of achieving a legitimate aim. Exception for national security 24. Nothing in Part II or III shall render unlawful an act done for the purpose of safeguarding national security, if the doing of the act was justified by that purpose. The issues regarding closed material procedure in more detail Employment Tribunals are established under the Employment Tribunals Act 1996. Section 7 entitles the Secretary of State to make by regulations (employment tribunal procedure regulations) . such provision as appears to him to be necessary or expedient with respect to proceedings before employment tribunals. Section 10, which I set out in the annex to this judgment, specifically authorises the making in the interests of national security of regulations providing for a closed material procedure, either by direction of a minister or by order of the employment tribunal or judge, and for the appointment by the Attorney General in that context of a special advocate. The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (SI 2004/1861) contain in Schedules 1 and 2 provisions made under sections 7 and 10 of the Act. Schedule 1, headed the Employment Tribunals Rules of Procedure (the ET Procedure Rules), contains rule 54, set out in the annex, providing specifically for a closed material procedure where a minister so directs (rule 54(1)) or where the tribunal or employment judge concludes that such a procedure is appropriate and so orders (rule 54(2)). Schedule 2, headed the Employment Tribunals (National Security) Rules of Procedure (the ET National Security Rules), contains rules 8 and 10, also set out in the annex, providing for special advocates and reasons in national security proceedings. Regulation 16 provides that the rules in Schedule 1 apply to employment tribunal proceedings generally, but that such rules shall be modified in accordance with Schedule 2 wherever any power conferred on the minister, the tribunal or an employment judge by rule 54 of Schedule 1 is exercised. Regulation 2 of the 2004 Regulations contains definitions, again set out in the annex. Mr Tariqs cross appeal (a) general The power to give directions conferred on the minister by rule 54(1) has not been exercised in this case. The Supreme Court was told that it has never been exercised in any case. The probable reasons are not difficult to discern, bearing in mind the scope for challenge both by judicial review and, more fundamentally, under the Human Rights Act 1998 or, Mr Robin Allen QC also submits for Mr Tariq, European Union law. While the conferral of the power is expressly authorised by the 1996 Act, it is hard to see how it could be compatible with article 6 of the European Convention on Human Rights for a minister to have power to make such a direction to a judicial tribunal. Instead of giving any direction, the minister made an application to the tribunal, asking it to order a closed material procedure with a special advocate under the discretionary power conferred by rule 54(2). On 15 February 2008, the tribunal held that it was expedient in the interest of national security to make orders under rule 54 that the whole of the proceedings be in private, and directed that Mr Tariq and his representative should be excluded from part of the proceedings when closed evidence and/or documents were being considered, that the Tribunal would consider both open and closed documents and that the Home Office would make available the appropriate closed material to any special advocate appointed. It further stated that the terms so ordered would be reviewed at a later case management discussion. At a case management discussion held on 30 May 2008, in the presence of representatives of the parties and of Ms J Farbey of counsel nominated by the Attorney General to act as special advocate, the judge ordered that her role as special advocate should take effect and that she should proceed in discussions with Mr Tariq. Meanwhile, reasons for the tribunals decision on 15 February 2008 were outstanding. The minister, to whom the tribunal was required by rule 10 of the ET National Security Rules to submit such reasons in the first instance, directed that one paragraph be abridged and another omitted. As a result, an edited version, identifying the positions of the amendment and abridgement, was initially issued to Mr Tariq and his representatives on 15 October 2008. However, on 9 December 2008 the full reasons were released. One may speculate that this resulted from submissions made by the special advocate. The paragraphs amended and omitted do not, on their face, seem likely to impact on national security. This course of events offers therefore a cautionary message, but, quite possibly also, an indication of at least one purpose which a special advocate may serve. In the upshot, there is not now any ministerial order in effect under rule 10. Whatever objections may be made to a rule giving the executive power to direct the judiciary with regard to reasons do not therefore arise for consideration on this appeal. This appeal concerns an exercise by the Tribunal of its power under rule 54(2) of the ET Procedure Rules, read with rule 8 of the ET National Security Rules. (b) The European Union Directives On behalf of Mr Tariq, Mr Allen submits that rule 54(2) and rule 8 are contrary to European Union law and/or the European Human Rights Convention. These rules were made pursuant to the express statutory authority to make such rules conferred by section 10 of the Employment Tribunals Act 1996. Mr Allens first submission is that they are, none the less, in conflict with European legal principles governing discrimination, contained in the European Treaties and in the Race and Employment Equality Directives, to which the 1996 Act, the Race Relations Act 1976 and the Employment Equality Regulations must all be read, at least as far as possible, as being subject. Mr Allen notes in this connection a contrast between the two Directives. The Employment Equality Directive makes express reference to national security, providing in article 2(5): 5. This Directive shall be without prejudice to measures laid down by national law which, in a democratic society, are necessary for public security, for the maintenance of public order and the prevention of criminal offences, for the protection of health and for the protection of the rights and freedoms of others. There is no equivalent provision in the Race Directive. Mr Allen suggests that this may be because the Race Directive does not preclude discrimination on grounds of nationality: article 3(2). Mr Allen further notes that neither Directive makes express provision for closed hearings, and that the Court of Justice has on more than one occasion made clear that the European Treaties contain no general power for states to derogate from European law and the rights it confers on grounds of public safety or national defence, outside specific situations identified in Treaty articles, none of which applies here: Case 222/84 Johnston v Chief Constable of the Royal Ulster Constabulary [1987] QB 129; Case C 337/05 Commission of the European Communities v Italian Republic [2008] ECR I 2173. None of these points is, in my view, relevant in the present context. I agree with the reasoning and conclusions of Maurice Kay LJ in paras 12 to 22 of his judgment in the Court of Appeal: [2010] ICR 1034. The authorities cited by Mr Allen deal with derogation from principles of substantive law, here the rights not to be discriminated against conferred by the Directives. The legitimacy of closed hearings and of the use of a special advocate are matters of procedural law. Procedure is primarily a matter for national law. It is, however, a basic principle of European Union law that national law should provide effective legal protection, by establishing a system of legal remedies and procedures which ensure respect for the relevant right: Case C 312/93 Peterbroeck v Belgian State [1995] ECR I 4599; Case C 432/05 Unibet (London) Ltd v Justitie Kanslern [2007] ECR I 2271. In that respect, European Union law directs attention primarily to principles established under articles 5 and 6 of the European Convention on Human Rights as a guide to what constitutes effective legal protection. Mr Allen points out that the Directives both contain provisions (article 7(1) of the Race Directive and article 9 of the Employment Equality Directive), whereby: Member states shall ensure that judicial and/or administrative procedures, including where they deem it appropriate conciliation procedures, for the enforcement of obligations under this Directive are available to all persons who consider themselves wronged by failure to apply the principle of equal treatment to them, even after the relationship in which the discrimination is alleged to have occurred has ended. Further, by articles 8 and 10 respectively of these Directives: Member states shall take such measures as are necessary, in accordance with their national judicial systems, to ensure that, when persons who consider themselves wronged because the principle of equal treatment has not been applied to them establish, before a court or other competent authority, facts from which it may be presumed that there has been direct or indirect discrimination, it shall be for the respondent to prove that there has been no breach of the principle of equal treatment. Again, and as this wording contemplates, it is for each national judicial system to ensure an effective system of legal procedures enabling a claimant to establish facts from which it may be presumed that there has been direct or indirect discrimination. In the present case, Mr Allen has not suggested that Mr Tariq has not been able to do this. Mr Allen also submits that Mr Tariq could lose his claim by reason of section 42 of the Race Relations Act 1976 and/or regulation 24 of the Employment Equality Regulations on a basis which, by reason of the closed material procedure, would not be disclosed. Section 42 and regulation 24 are dealing with substantive law. If they were read and applied as excusing what would otherwise be unlawful discrimination, they might therefore be open to challenge under the principle of European Union law identified in para 14 above. But the present case is far from involving any such issue. First, the issue could only arise from a substantive decision, and the Tribunal is a long way from reaching such a decision. Second, it is far from clear that section 42 and regulation 24 are to be read as entitling a tribunal or court to excuse what would otherwise be unjustified discrimination on grounds of national security. The question would arise: if it would involve unjustified discrimination, how could the doing of the act be justified for the purpose of safeguarding national security? Third, the Home Offices dominant aim in the present proceedings is to show that there was no discrimination at all on any prohibited ground, but a rational and proportionate decision taken in the public interest. If the Employment Tribunal were at some future stage to find that there was discrimination on a prohibited ground, but that the effect of section 42 and/or regulation 24 was that such discrimination could none the less be regarded as justified as being for the purpose of safeguarding national security, the Tribunal would be obliged to identify this basis of decision, however generally, in open reasons, to enable its legitimacy under European Union law to be challenged. There is no reason to assume that the Tribunal, assisted as it would also be by a special advocate, would fail to do this. (c) Effective legal protection The question is therefore whether the closed material procedure authorised by United Kingdom law provides effective legal protection, by establishing a system of legal remedies and procedures to ensure respect for the relevant rights conferred by the Race Relations Act and the Employment Equality Regulations in implementation of the United Kingdoms obligations under the two Directives. Mr Allen relies upon the decisions of the Court of Justice in Joined Cases C 402/05 P and C 415/05 P Kadi v Council of the European Union and the General Court in Case T 85/09 Kadi v Commission of the European Union (Council of the European Union intervening). These two cases concerned the validity of the European Unions own measures, and the two European Courts were charged not merely with ascertaining and interpreting the relevant European legal principles applicable under the Treaties, but also with applying these to the particular measures and circumstances before them. In the former case [2009] AC 1225, the Court of Justice addressed Council Regulation 881/2002 which aimed to mirror within Europe a similar asset freezing regime to that mandated by Security Council Resolutions for all member states of the United Nations. The Regulation, in its Annex I, simply listed as persons whose assets were to be frozen persons whose names appeared on a list drawn up by the Security Councils Sanctions Committee, and no opportunity was given before or after its passing to such persons to mount any legal challenge to such listing at either the Security Council or the European level. The Court of Justice accepted that: 342 . with regard to a Community measure intended to give effect to a resolution adopted by the Security Council in connection with the fight against terrorism, overriding considerations to do with safety or the conduct of the international relations of the Community and of its Member States may militate against the communication of certain matters to the persons concerned and, therefore, against their being heard on those matters. It went on: 343 However, that does not mean, with regard to the principle of effective judicial protection, that restrictive measures such as those imposed by the contested regulation escape all review by the Community judicature once it has been claimed that the act laying them down concerns national security and terrorism. 344 In such a case, it is none the less the task of the Community judicature to apply, in the course of the judicial review it carries out, techniques which accommodate, on the one hand, legitimate security concerns about the nature and sources of information taken into account in the adoption of the act concerned and, on the other, the need to accord the individual a sufficient measure of procedural justice (see, to that effect, the judgment of the European Court of Human Rights in Chahal v United Kingdom (1996) 23 EHRR 413, para 131). The Regulation was annulled in respect of Mr Kadi and Al Barakaat (a Swedish foundation) because there had been no procedure for communicating any evidence or for any hearing of persons listed, so that such persons rights of defence and to an effective legal remedy were infringed. But the Court postponed the annulment for up to three months from 3 September 2008. The second Kadi case [2011] 1 CMLR 697 was a sequel. After the first case, the Commission sought and obtained from the Sanctions Committee a summary of its reasons for listing Mr Kadi, communicated that to him and received his comments on it on 10 November 2008. On 28 November 2008 the Commission by Commission Regulation (EC) No 1190/2008, made pursuant to a power in Regulation 881/2002 to amend Annex I to that Regulation, recited this course of events and purported on that basis to amend Annex I to reinsert Mr Kadi and Al Barakaat. Mr Kadi again successfully challenged this. The General Court held that his rights of defence had been observed only in the most formal and superficial sense, as the Commission in actual fact considered itself strictly bound by the Sanctions Committees findings and therefore at no time envisaged calling those findings into question in the light of the applicants observations (para 171). The General Court went on to say that the Commission, notwithstanding recitals in its Regulation, failed to take due account of the applicants comments (para 172) and that the procedure followed by the Commission, in response to the applicant's request, did not grant him even the most minimal access to the evidence against him. In actual fact, the applicant was refused such access despite his express request, whilst no balance was struck between his interests, on the one hand, and the need to protect the confidential nature of the information in question, on the other (see, in that regard, the judgment of the Court of Justice in Kadi, paras 342 to 344) (para 173). The General Court noted that this conclusion was consistent with the reasoning on the European Court of Human Rights in A v United Kingdom [2009] 49 EHRR 625 (para 176). Earlier in its judgment, at paras 146 147, the General Court said this about national security issues, with reference to its previous judgment in Case T 228/02 Organisation des Modjahedines du Peuple d'Iran v Council of the European Union [2006] ECR II 4665 (OMPI): 146 The General Court also noted in that regard, at para 156 of OMPI, that, although the European Court of Human Rights recognises that the use of confidential information may be necessary when national security is at stake, that does not mean, in that court's view, that national authorities are free from any review by the national courts simply because they state that the case concerns national security and terrorism (see the judgment of the European Court of Human Rights in Chahal v United Kingdom, para 131, and case law cited, and its judgment in calan v Turkey (2003) 37 EHRR 238, para 106 and case law cited). 147 The General Court added, at para 158 of OMPI, that it was not necessary for it to rule, in the action before it, on the separate question as to whether the applicant and/or its lawyers could be provided with the evidence and information alleged to be confidential, or whether they had to be provided only to the Court, in accordance with a procedure which remained to be defined so as to safeguard the public interests at issue whilst affording the party concerned a sufficient degree of judicial protection. The question identified by the General Court in para 147 did not arise for decision in either of the two Kadi cases. It is, however, clear from both Kadi cases that the Court of Justice will look for guidance in the jurisprudence of the European Court of Human Rights when deciding whether effective legal protection exists, and how any balance should be struck when a question arises whether civil procedures should be varied to reflect concerns relating to national security. A national court, faced with an issue of effective legal protection or, putting the same point in different terms, access to effective procedural justice, can be confident that both European courts, Luxembourg and Strasbourg, will have the same values and will expect and accept similar procedures. Article 6(2) of the Treaty on the European Union (The Union shall respect fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law) and the Charter of Fundamental Rights already point strongly in this direction. Assuming that the European Union will in due course formally subscribe to the European Convention on Human Rights, as contemplated by the Treaty amendments introduced under the Treaty of Lisbon, the expectation will receive still further reinforcement. In the present case, the Home Office applied for and obtained the Tribunals order for a closed material procedure in order to be able to defend itself against Mr Tariqs claim that the removal of his security clearance involved unlawful discrimination on grounds of race or religion. The case concerns a different subject matter from that of both Kadi cases, where freezing orders were in issue. The effect of freezing orders (made under United Kingdom legislation directly implementing the Security Councils Resolutions) was examined by the Supreme Court in A v HM Treasury (JUSTICE intervening) [2010] UKSC 2; [2010] 2 AC 534. Persons subject to such orders became effectively prisoners of the state and there was a devastating effect on them and their families: para 60. A v United Kingdom, to which the General Court in Kadi referred, also involved a different subject matter to the present, concerning, as it did, the detention of foreign nationals suspected of terrorist involvement. Rights said that: In A v United Kingdom 49 EHRR 695 the European Court of Human 216 The Court takes as its starting point that, as the national courts found and it has accepted, during the period of the applicants detention the activities and aims of the AlQaeda network had given rise to a public emergency threatening the life of the nation. It must therefore be borne in mind that at the relevant time there was considered to be an urgent need to protect the population of the United Kingdom from terrorist attack and, although the United Kingdom did not derogate from article 5(4), a strong public interest in obtaining information about AlQaeda and its associates and in maintaining the secrecy of the sources of such information (see also, right under article 5(4) in this connection, Fox, Campbell and Hartley (1991) 13 EHRR 157, para 39). 217 Balanced against these important public interests, however, was the applicants' to procedural fairness. Although the Court has found that, with the exception of the second and fourth applicants, the applicants detention did not fall within any of the categories listed in sub paragraphs (a) to (f) of article 5(1), it considers that the case law relating to judicial control over detention on remand is relevant, since in such cases also the reasonableness of the suspicion against the detained person is a sine qua non (see para 197 above). Moreover, in the circumstances of the present case, and in view of the dramatic impact of the lengthy and what appeared at that time to be indefinite deprivation of liberty on the applicants' fundamental rights, article 5(4) must import substantially the same fair trial guarantees as article 6(1) in its criminal aspect (Garcia Alva v Germany (2003) 37 EHRR 335, para 39, and see also see Chahal, cited above, paras 130 131). 218 Against this background, it was essential that as much information about the allegations and evidence against each applicant was disclosed as was possible without compromising national security or the safety of others. Where full disclosure was not possible, article 5(4) required that the difficulties this caused were counterbalanced in such a way that each applicant still had the possibility effectively to challenge the allegations against him. 219 The Court considers that SIAC, which was a fully independent court (see para 84 above) and which could examine all the relevant evidence, both closed and open, was best placed to ensure that no material was unnecessarily withheld from the detainee. In this connection, the special advocate could provide an important, additional safeguard through questioning the states witnesses on the need for secrecy and through making submissions to the judge regarding the case for additional disclosure. On the material before it, the Court has no basis to find that excessive and unjustified secrecy was employed in respect of any of the applicants' appeals or that there were not compelling reasons for the lack of disclosure in each case. 220 The Court further considers that the special advocate could perform an important role in counterbalancing the lack of full disclosure and the lack of a full, open, adversarial hearing by testing the evidence and putting arguments on behalf of the detainee during the closed hearings. However, the special advocate could not perform this function in any useful way unless the detainee was provided with sufficient information about the allegations against him to enable him to give effective instructions to the special advocate. While this question must be decided on a case by case basis, the Court observes generally that, where the evidence was to a large extent disclosed and the open material played the predominant role in the determination, it could not be said that the applicant was denied an opportunity effectively to challenge the reasonableness of the Secretary of State's belief and suspicions about him. In other cases, even where all or most of the underlying evidence remained undisclosed, if the allegations contained in the open material were sufficiently specific, it should have been possible for the applicant to provide his representatives and the special advocate with information with which to refute them, if such information existed, without his having to know the detail or sources of the evidence which formed the basis of the allegations. An example would be the allegation made against several of the applicants that they had attended a terrorist training camp at a stated location between stated dates; given the precise nature of the allegation, it would have been possible for the applicant to provide the special advocate with exonerating evidence, for example of an alibi or of an alternative explanation for his presence there, sufficient to permit the advocate effectively to challenge the allegation. Where, however, the open material consisted purely of general assertions and SIAC's decision to uphold the certification and maintain the detention was based solely or to a decisive degree on closed material, the procedural requirements of article 5(4) would not be satisfied. In Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28; [2010] 2 AC 269, the House of Lords applied the reasoning in para 220 of A v United Kingdom when concluding that a closed material procedure involving a special advocate could be legitimate in the context of the imposition of a control order on a suspected terrorist, so long as the case was not based solely or to a decisive extent on closed material. Mr Allen submits that the fundamental nature of equality rights makes it just as critical that Mr Tariq should receive the fullest procedural rights in this case as it was for Mr Kadi or A or AF to have such rights. However, the reasoning in para 217 of the European Court of Human Rights judgment in A v United Kingdom emphasises the context of that decision, the liberty of the individual. Detention, control orders and freezing orders impinge directly on personal freedom and liberty in a way to which Mr Tariq cannot be said to be exposed. In R(AHK) v Secretary of State for the Home Department (Practice Note) [2009] EWCA Civ 287; [2009] 1 WLR 2049, a claim for judicial review of the refusal of an application for British citizenship, the Court of Appeal distinguished A v United Kingdom on the ground that it was focusing on detention. In my opinion, it was justified in making this distinction. An applicant for British citizenship has, of course, an important interest in the appropriate outcome of his or her application. Mr Tariq also has an important interest in not being discriminated against which is entitled to appropriate protection; and this is so although success in establishing discrimination would be measured in damages, rather than by way of restoration of his security clearance (now definitively withdrawn) or of his position as an immigration officer. But the balancing exercise called for in para 217 of the European Courts judgment in A v United Kingdom depends on the nature and weight of the circumstances on each side, and cases where the state is seeking to impose on the individual actual or virtual imprisonment are in a different category to the present, where an individual is seeking to pursue a civil claim for discrimination against the state which is seeking to defend itself. That the outcome of the balancing exercise may differ with the circumstances is confirmed by three decisions of the European Commission and Court of Human Rights: Leander v Sweden (1987) 9 EHRR 433, Esbester v United Kingdom (1993) 18 EHRR CD72 and Kennedy v United Kingdom (Application No 26839/05) (unreported) 18 May 2010. In Leander, the applicant had been refused permanent employment as museum technician with the Naval Museum, which was adjacent to the Karlskrona Naval Base in which the Museum had storage rooms and other objects to which he would need access. The refusal was on account of secret information, contained in an annex compiled by the police, which was alleged to make him a security risk and to which he was refused access. He claimed that there had been breaches of, inter alia, articles 8 and 13 of the Convention. The Court did not accept this. Article 8 provides that everyone has the right to respect for his private life, and that there shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or other specified interests. As to article 8, the Court held that, although there was adverse interference with Mr Leanders private life through the consequences for his access to certain sensitive posts (para 59) and although he was refused any possibility of challenging the correctness of the information concerning him (para 61), the system for collecting and using the secret information contained a number of internal safeguards (para 62) and it could not be concluded that the interference involved in the non communication of the information to Mr Leander was not necessary in a democratic society in the interests of national security, as it is the very absence of such communication which, at least partly, ensures the efficacy of the personnel control procedure (para 66). Article 13 provides that everyone whose rights and freedoms as set forth in this Convention are violated shall have an effective remedy before a national authority. As to article 13, the Court in Leander held by a majority (4 to 3) that an effective remedy under article 13 must mean a remedy that is as effective as can be, having regard to the restricted scope for recourse inherent in any system of secret surveillance for the protection of national security (para 84), and that, even if the procedure of complaint to the Government (which Mr Leander had followed and which had led to the Cabinet rejecting his complaint) were not considered sufficient, the aggregate of that and the other remedies of complaint to the Swedish Parliamentary Ombudsman and Chancellor of Justice (which he could also have pursued, although their views would only have been advisory) satisfied the conditions of article 13 (para 84). In Esbester 18 EHRR CD72 the Commission was again concerned with a refusal to employ, in this case as an administrative officer with the Central Office of Information (COI). The COI having offered to employ Mr Esbester subject to the satisfactory completion of our inquiries ., gave as its reasons for refusal simply that having completed our inquiries . we are unable to offer you an appointment. Mr Esbester claimed infringement of articles 8 and 13, maintaining that it was likely that the intelligence services had in the course of negative vetting procedures obtained and relied upon information about his private life, which he had had no opportunity to refute. He also alleged that there was inadequate legal regulation regarding the gathering of such information, and that the Security Service Tribunal responsible for investigating complaints gave inadequate protection and was prevented from giving reasons for its decisions. The Commission accepted, following Leander, that security vetting based on information about a persons private life constitutes interference within article 8, and it accepted, following Klass v Federal Republic of Germany (1978) 2 EHRR 214 and Malone v United Kingdom (1985) 7 EHRR 14 that the existence in the United Kingdom of a system for secret surveillance for vetting and the circumstances giving rise to the refusal to employ Mr Esbester gave rise to an inference that such interference had taken place. But it rejected Mr Esbesters complaints as manifestly unfounded. In finding the United Kingdoms system to be in accordance with the law, the Commission noted that the Court had held in Leander that the requirement of foreseeability in the special context of employment vetting in sectors affecting national security cannot be the same as in many other fields. In finding that the system was necessary in a democratic society, the Commission said, again with reference to Leander, that regard must also be had in this context to the margin of appreciation of the respondent state which in the area of assessing the requirements of and means of pursuing interests of national security has been held by the Court to be wide. In considering whether there existed adequate and effective guarantees against abuse, as required by the Courts decision in Klass, the Commission noted that the term national security was not amenable to exhaustive definition, and that, as regards the lack of reasons for the decisions of the Tribunal, the Court in Klass, when considering a similar problem, had found that the state could legitimately fear that the efficacy of surveillance systems might be jeopardised if information is divulged to the person concerned. The Commission concluded its discussion of article 8 by saying that In the absence of any evidence or indication that the system is not functioning as required by domestic law, the Commission finds that the framework of safeguards achieves a compromise between the requirements of defending democratic society and the rights of the individual which is compatible with the provisions of the Convention. Consequently it concludes that the interference in the present case was necessary in a democratic society in the interests of national security. As to article 13, the Commission held that the complaint of lack of an effective remedy failed in the absence of any arguable claim for breach of article 8. In Kennedy v United Kingdom decided by its Fourth Section on 18 May 2010, the Court was concerned with a claim that there had been breaches of articles 6 (the right to a fair trial in the determination of civil rights and obligations), 8 and 13 in circumstances where the claimants requests to MI5 and GCHQ under the Data Protection Act 1998 to discover whether information about him was being processed had been refused on the grounds of national security. Complaints about such refusals to the Investigatory Powers Tribunal (IPT) chaired by Lord Justice Mummery were examined in private. They concluded with the IPT simply notifying Mr Kennedy that no determination had been made in his favour in respect of his complaints. This meant either that there had been no interception or that any interception which took place was lawful (para 20). As to article 8, the Court held that the domestic law, practice and safeguards relating to surveillance satisfied the conditions of that article. It referred to, inter alia, Leander v Sweden as establishing that the requirement that the consequences of the domestic law must be foreseeable, before any interference could be said to be in accordance with the law under article 8(2), cannot be the same in the context of interception of communications as in many other fields (paras 151 152). As to article 6, the Court in Kennedy found it unnecessary to decide whether this article applies to proceedings concerning a decision to put someone under surveillance, because it concluded that, assuming it does, the IPTs rules of procedure complied with the requirements of article 6(1) (para 179). The parties respective cases appear from the following paragraphs of the Courts judgment: 181. The applicant submitted that even where national security was at stake, a domestic court could not infringe the fair hearing principle in a blanket and uncritical manner. He argued that less restrictive measures were available to achieve the aim pursued, including arrangements to protect witnesses' identities, disclosure of documents with redactions approved by the IPT, provision of a summary of particularly sensitive material under the supervision of the IPT and appointment of special advocates to whom disclosure of sensitive material could be made. He referred to a recent report on secret evidence published in June 2009 by the non governmental organisation, JUSTICE, which called for the strengthening of disclosure procedures and increased transparency in court proceedings. 182. The Government emphasised that even where article 6(1) applied to a field falling within the traditional sphere of public law, this did not in itself determine how the various guarantees of article 6 should be applied to such disputes (citing Vilho Eskelinen v Finland (2007) 45 EHRR 993, para 64). The obligation to read the Convention as a whole meant that the scope of the article 6 guarantees in such a case should be in harmony with the Court's approach to judicial control under article 8. The Government argued that the overarching consideration was that an individual could not be notified of interception measures while interception was ongoing or where notification would jeopardise the capabilities or operations of intercepting agencies. They therefore disputed that the less restrictive measures proposed by the applicant were appropriate. They noted that protection of witnesses' identities would not assist in keeping secret whether interception had occurred. Nor would disclosure of redacted documents or summaries of sensitive material. Further, unless they were appointed in every case, the appointment of special advocates would also allow a complainant to draw inferences about whether his communications had been intercepted. 183. The Government argued that the procedure before the IPT offered as fair a procedure as could be achieved in the context of secret surveillance powers. In particular, a complainant did not have to overcome any evidential burden to apply to the IPT and any legal issues could be determined in a public judgment after an inter partes hearing. Further, the IPT had full powers to obtain any material it considered necessary from relevant bodies and could call upon the assistance of the Commissioner. It could appoint an advocate to assist it at closed hearings. Finally, in the event that the complainant was successful, a reasoned decision would be provided. The Court, in holding that there had been no violation of article 6 or 13 in Kennedy, substantially aligned itself with the United Kingdom Governments position particularly in so far as it endorsed in relation to the concept of a fair trial under article 6 the relevance of similar considerations to those taken into account, previously and in Kennedy itself, when applying articles 8 and 13. It held: 184. The Court reiterates that according to the principle of equality of arms, as one of the features of the wider concept of a fair trial, each party must be afforded a reasonable opportunity to present his case under conditions that do not place him at a substantial disadvantage vis a vis his opponent . The Court has held none the less that, even in proceedings under article 6 for the determination of guilt on criminal charges, there may be restrictions on the right to a fully adversarial procedure where strictly necessary in the light of a strong countervailing public interest, such as national security, the need to keep secret certain police methods of investigation or the protection of the fundamental rights of another person. There will not be a fair trial, however, unless any difficulties caused to the defendant by a limitation on his rights are sufficiently counterbalanced by the procedures followed by the judicial authorities (see, for example, Doorson v The Netherlands (1996) 22 EHRR 330, para 70; Jasper v United Kingdom (2000) 30 EHRR 441, paras 51 to 53; and A v United Kingdom (2009) 49 EHRR 625, para 205). A similar approach applies in the context of civil proceedings. 185. The Court notes that the IPT, in its preliminary ruling of 23 January 2003, considered the applicant's complaints regarding the compliance of the Rules with article 6(1). It found that, with the exception of rule 9(6) which required all oral hearings to be held in private, the Rules challenged by the applicant were proportionate and necessary, with special regard to the need to preserve the Government's neither confirm nor deny policy 186. At the outset, the Court emphasises that the proceedings related to secret surveillance measures and that there was therefore a need to keep secret sensitive and confidential information. In the Court's view, this consideration justifies restrictions in the IPT proceedings. The question is whether the restrictions, taken as a whole, were disproportionate or impaired the very essence of the applicant's right to a fair trial. 187. In respect of the rules limiting disclosure, the Court recalls that the entitlement to disclosure of relevant evidence is not an absolute right. The interests of national security or the need to keep secret methods of investigation of crime must be weighed against the general right to adversarial proceedings (see, mutatis mutandis, Edwards and Lewis v United Kingdom (2005) 40 EHRR 593, para 46). The Court notes that the prohibition on disclosure set out in rule 6(2) admits of exceptions, set out in rules 6(3) and (4). Accordingly, the prohibition is not an absolute one. The Court further observes that documents submitted to the IPT in respect of a specific complaint, as well as details of any witnesses who have provided evidence, are likely to be highly sensitive, particularly when viewed in light of the Government's neither confirm nor deny policy. The Court agrees with the Government that, in the circumstances, it was not possible to disclose redacted documents or to appoint special advocates as these measures would not have achieved the aim of preserving the secrecy of whether any interception had taken place. It is also relevant that where the IPT finds in the applicant's favour, it can exercise its discretion to disclose such documents and information under rule 6(4) . 188. As regards limitations on oral and public hearings, the Court recalls, first, that the obligation to hold a hearing is not absolute. There may be proceedings in which an oral hearing is not required and where the courts may fairly and reasonably decide the case on the basis of the parties' submissions and other written materials. The character of the circumstances that may justify dispensing with an oral hearing essentially comes down to the nature of the issues to be decided by the competent national court (see Jussila v Finland (2006) 45 EHRR 900, paras 41 to 42). The Court notes that rule 9(2) provides that oral hearings are within the IPT's discretion and it is clear that there is nothing to prevent the IPT from holding an oral hearing where it considers that such a hearing would assist its examination of the case. 189. Concerning the provision of reasons, the Court emphasises that the extent to which the duty to give reasons applies may vary according to the nature of the decision and must be determined in the light of the circumstances of the case (see Ruiz Torija v Spain (1994) 19 EHRR 553, para 29). In the context of the IPT's proceedings, the Court considers that the "neither confirm nor deny" policy of the Government could be circumvented if an application to the IPT resulted in a complainant being advised whether interception had taken place. In the circumstances, it is sufficient that an applicant be advised that no determination has been in his favour. The Court further notes in this regard that, in the event that a complaint is successful, the complainant is entitled to have information regarding the findings of fact in his case . 190. In light of the above considerations, the Court considers that the restrictions on the procedure before the IPT did not violate the applicant's right to a fair trial. In reaching this conclusion, the Court emphasises the breadth of access to the IPT enjoyed by those complaining about interception within the United Kingdom and the absence of any evidential burden to be overcome in order to lodge an application with the IPT. In order to ensure the efficacy of the secret surveillance regime, and bearing in mind the importance of such measures to the fight against terrorism and serious crime, the Court considers that the restrictions on the applicant's rights in the context of the proceedings before the IPT were both necessary and proportionate and did not impair the very essence of the applicant's article 6 rights. As regards article 13, the Court held that the IPT offered to the applicant an effective remedy insofar as his complaint was directed towards the alleged interception of his communications and, in respect of the applicants general complaint under article 8, it reiterated its case law to the effect that article 13 does not require the law to provide an effective remedy where the alleged violation arises from primary legislation, citing in this respect also Leander v United Kingdom 9 EHRR 433. These three cases Leander, Esbester and Kennedy establish that the demands of national security may necessitate and under European Convention law justify a system for handling and determining complaints under which an applicant is, for reasons of national security, unable to know the secret material by reference to which his or her complaint is determined. The critical questions under the Convention are whether the system is necessary and whether it contains sufficient safeguards. But, subject to satisfactory answers on these questions, national security considerations may justify a closed material procedure, closed evidence (even without use of a special advocate) and, furthermore, (as in Kennedy itself) a blanket decision leaving the precise basis of determination unclear. There is however a further decision, even more recent than Kennedy, on which Mr Allen relies in an opposite sense. That is Uukauskas v Lithuania (Application No 16965/04) decided by the Second Section of the Court on 6 July 2010. The applicant had a licence to keep a pistol and hunting rifle. His request for a licence for another kind of firearm was refused and his existing licence was withdrawn, after his listing by the police in an operational records file maintained by the police to hold data for law enforcement bodies obtained during operational activities. He instituted proceedings challenging his listing, and the court, after examining classified material submitted by the police without disclosure to the applicant, upheld the listing. He complained to the European Court of Human Rights on the basis that there had been a breach of article 6(1). The Court said (para 48): The Court is not insensitive to the goals which the Lithuanian law enforcement authorities pursued through their operational activities. Likewise, the Court shares the Government's view that documents which constitute state secrets may only be disclosed to persons who possess the appropriate authorisation. And yet the Court notes that Lithuanian law and judicial practice provide that such information may not be used as evidence in court against a person unless it has been declassified, and that it may not be the only evidence on which a court bases its decision (see paras 20 22 above). It went on to indicate that the file was the only evidence of the applicants alleged danger to society, that he had repeatedly asked for its disclosure to him, even in part, and that, without it, he had no possibility of being apprised of the evidence against him or of being able to respond to it (paras 50 51). The Court concluded (para 51): In conclusion, therefore, the Court finds that the decision making procedure did not comply with the requirements of adversarial proceedings or equality of arms, and did not incorporate adequate safeguards to protect the interests of the applicant. It follows that there has been a violation of article 6(1) in the present case. The case has the special feature that the procedure adopted was contrary to Lithuanian law. Quite probably for this reason, no reference was made to any of the decisions considered in paras 28 to 36 of this judgment. There was evidently also no procedure under Lithuanian law for the use of a special advocate to consider closed material: the choice lay between declassification and no use of the material at all. The decision is therefore very far from the present, and does not offer assistance on the issues which arise on this appeal. (d) Necessity for a closed material procedure in this case In the present case, Mr Allen submits that no necessity is shown for a closed material procedure. He submits that the rule of law and the maintenance of the modern democratic state [will] not [be] imperilled if the Home Office loses this case for want of advancing a secret case. In other words, the worst that may happen is that the Home Office has to pay an unmeritorious claim. On this basis, Mr Allen distinguishes control order cases such as AF (No 3), in which it could be said that national security would be directly imperilled if secret evidence could not be used to justify imposing a control order. This distinction would positively encourage unmeritorious claims; and it would on any view mean that the government could only operate a security vetting system on pain of having to accept or pay all claims for discrimination which appeared sufficiently arguable to avoid being dismissed as abusive. The only other possibility is that a court might, following the Court of Appeal decision in Carnduff v Rock [2001] EWCA Civ 680, [2001] 1 WLR 1786, determine that, if the national security material could not be deployed in defence, the claim might not be fairly justiciable at all. Laws LJ said of this situation in Carnduff (para 36) that . a case which can only be justly tried if one side holds up its hands cannot, in truth, be justly tried at all. Under that possibility, it would be Mr Tariqs case which would fail in limine. Neither of these possibilities is one which the law should readily contemplate. In the penal context, an accused is presumed innocent until proved guilty; there is a public interest in the trial of suspects before a court, but it is better that the state should forego prosecution than that there should be any risk of an innocent person being found guilty through inability to respond to the full case against them. These imperatives do not operate in quite the same way in a civil context like the present, where the state may not be directly involved as a party at all. The rule of law must, so far as possible, stand for the objective resolution of civil disputes on their merits by a tribunal or court which has before it material enabling it to do this. In considering how this may be achieved, if a defendant can only defend itself by relying on material the disclosure of which would damage national security, a balance may have to be struck between the interests of claimant and defendant in a civil context. Mr Allens submission also involves anomalies. The Leander, Esbester and Kennedy cases demonstrate that, had Mr Tariq been claiming that the decision to suspend or remove security clearance was unjustified on its merits, he could not have complained about the use of a closed material procedure. Yet, on Mr Allens submission, all such a claimant would (presumably) have to do would be to claim damages, rather than any other relief. The Home Office could still only defend the claim by disclosing material contrary to the national interest; but, on Mr Allens case, no problem arises: the Home Office would not have to damage the national interest by making disclosure; instead, it could simply admit liability or defend fruitlessly and lose for want of being able to deploy the material. I cannot think that that is the law, in Strasbourg or domestically. (e) The acceptability of a special advocate procedure I do not therefore consider that a closed material procedure is in principle inconsistent with the right to an effective remedy in respect of alleged discrimination or with the Human Rights Convention. But there are further strings to Mr Allens case, which call for closer examination of the actual procedure, in particular the use of a special advocate. A special advocate procedure has been accepted as potentially useful in both United Kingdom and Strasbourg case law. Thus, in A v United Kingdom, addressing the issue of detention of terrorist suspects without trial, the Court of Human Rights said (para 220): The Court further considers that the special advocate could perform an important role in counterbalancing the lack of full disclosure and the lack of a full, open, adversarial hearing by testing the evidence and putting arguments on behalf of the detainee during the closed hearings. However, the special advocate could not perform this function in any useful way unless the detainee was provided with sufficient information about the allegations against him to enable him to give effective instructions to the special advocate. The Court went on: While this question must be decided on a case by case basis, the Court observes generally that, where the evidence was to a large extent disclosed and the open material played the predominant role in the determination, it could not be said that the applicant was denied an opportunity effectively to challenge the reasonableness of the Secretary of State's belief and suspicions about him. In other cases, even where all or most of the underlying evidence remained undisclosed, if the allegations contained in the open material were sufficiently specific, it should have been possible for the applicant to provide his representatives and the special advocate with information with which to refute them, if such information existed, without his having to know the detail or sources of the evidence which formed the basis of the allegations. It concluded by saying that where the open material consisted of general assertions and the decision to maintain the detention was based solely or to a decisive degree on closed material, the procedural requirements of article 5(4) would not be satisfied. Domestically, the House of Lords in both Secretary of State for the Home Department v MB [2007] UKHL 46; [2008] AC 440 and Secretary of State for the Home Department v AF (No 3) [2010] 2 AC 269 accepted a special advocate procedure, while endorsing in AF (No 3) the applicability, in the context of control orders, of the approach taken in A v United Kingdom. Mr Allen draws attention to a report of the Joint Committee on Human Rights of the Houses of Lords and Commons on Counter Terrorism Policy and Human Rights (Session 2006 2007) (HL Paper 157, HC 394), published 30 July 2007, which precedes the cases mentioned in the previous paragraph. The Committee was addressing the use of special advocates in, in particular, control order proceedings, but it also heard evidence from four special advocates (including Ms Farbey who acts in this case), which ranged more widely. It identified a number of concerns. These included, first, the overriding duty to which it saw both SIAC and a court as being subject, to ensure that material was not disclosed contrary to the public interest, in other words its inability to balance the interests of justice to the individual against the public interest in non disclosure (paras 196 and 199). It was also concerned by, secondly, the difficulties presented if closed material was not gisted (paras 195 and 199) and, thirdly, the inflexibility of the prohibition on communication between special advocates and the person concerned or his or her legal representatives, once the special advocate had seen the closed material (paras 203 and 205). The first of these concerns is covered and resolved by case law subsequent to the Joint Committees Report. Under rule 54(2) the employment tribunal or judge has a discretion. This is subject to rule 54(4), according to which a tribunal or judge, when exercising its or his functions, shall ensure that information is not disclosed contrary to the interests of national security. But the tribunal or judge is subject to the overriding objective to deal with cases justly under regulation 3 of the Employment Procedure Regulations, and, most importantly also, obliged under section 3 of the Human Rights Act 1996 to interpret primary and secondary legislation in a way which is compatible with Convention rights. In Secretary of State for the Home Department v MB [2008] AC 440 (decided 31 October 2007), the House of Lords held that paragraph 4(3)(d) of the Prevention of Terrorism Act 2005 (the terms of which parallel those of rule 54(2)) should be read and given effect except where to do so would be incompatible with the right . to a fair trial (para 72, per Lady Hale; and see paras 84 and 92 per Lord Carswell and Lord Brown). The result was that, when and if the court did not consider that material could safely remain closed, the Secretary of State had a choice: either to disclose to the person concerned, or to withdraw reliance on the material. The House followed and applied this reasoning in Secretary of State for the Home Department v AF (No 3) [2010] 2 AC 269, when deciding that persons subject to control orders must be told the gist of the case against them. Applying it in the context of the present secondary legislation in rule 54(2), it means that, even if disclosure of material to the person concerned might involve some potential damage to national security, an employment tribunal or court might, weighing the interests of justice, conclude that either the state should make such disclosure, not merely to the special advocate but also to the person concerned, or it should withdraw any reliance on the material. Likewise, in relation to the third concern, it is a matter of discretion how far such contact is permitted, and the tribunal or judge can and should exercise such discretion flexibly and after balancing the competing interests. The second concern involves consideration of the case law and issue discussed in paras 28 to 37 above and 63 to 68 below. Mr Allen submits, first, that, despite the general endorsement of its potential appropriateness in these cases, the special advocate procedure involves flaws undermining its acceptability; and, secondly, that, even if the special advocate procedure is otherwise acceptable, this can only be on the basis of disclosure of the substance of the Home Offices case (gisting) in respect of Mr Tariq. Since the Court of Appeal accepted this second submission, it arises for consideration as a result of the Home Offices cross appeal. The flaws which Mr Allen identifies relate to the special advocates role and powers and the lack of guidance as to their exercise or supervision. These are matters of detail which he submits have gone largely and unjustifiably without scrutiny in previous cases. As to role, Mr Allen takes issue at the outset with the appointment of special advocates by the Attorney General who is the governments principal legal adviser. This is a point which was addressed and is the subject of previous authority in the form of the House of Lords decision in R v H [2004] UKHL 3; [2004] 2 AC 134, where the suitability of the Attorney General to act in this respect had been questioned in the courts below. Lord Bingham giving the unanimous opinion of the House said (para 46): In our opinion such doubt is misplaced. It is very well established that when exercising a range of functions the Attorney General acts not as a minister of the Crown (although he is of course such) and not as the public officer with overall responsibility for the conduct of prosecutions, but as an independent, unpartisan guardian of the public interest in the administration of justice: see Halsbury's Laws of England, 4th ed, vol 44(1) (1995), para 1344; Edwards, The Law Officers of the Crown (1964), pp ix, 286, 301 302. It is in that capacity alone that he approves the list of counsel judged suitable to act as special advocates or, now, special counsel, as when, at the invitation of a court, he appoints an amicus curiae. Counsel roundly acknowledged the complete integrity shown by successive holders of the office in exercising this role, and no plausible alternative procedure was suggested. It would perhaps allay any conceivable ground of doubt, however ill founded, if the Attorney General were to seek external approval of his list of eligible advocates by an appropriate professional body or bodies, but such approval is not in current circumstances essential to the acceptability of the procedure. Special advocates are appointed from the independent bar or solicitor advocates on the basis of open competition, and are selected for inclusion on the panel on the basis of their abilities. Mr Tariq was able to make representations as to the choice of his special advocate, in accordance with para 98 of the Treasury Solicitors Special Advocates Guide, Special Advocates A Guide to the Role of Special Advocates and the Special Advocates Support Office (SASO). His suggested choice was appointed. Para 88 of the Special Advocates Guide further makes clear that: The role of the Attorney General (or Solicitor General, acting in his place by virtue of section 1 Law Officers Act 1997) in appointing a special advocate is purely formal. No 'instructions' (other than in the purely formal sense) will come from the Law Officers to special advocates indicating any particular way that the case in which the special advocate is instructed is to be argued. That is a matter for special advocates and the appellant, to the extent that the appellant engages with the special advocates. Mr Allens first point on role is therefore one I reject. Mr Allen next submits that special advocates are subject to a conflict of interest which would be prohibited in private litigation. This is said to arise from the fact that they are supported by a unit (SASO) which is located within the Treasury Solicitors Department. It is not disputed (or disputable) that legal and administrative support is necessary for a special advocate procedure to work; and it is unclear as to where else such support might or should be located. The submission is simply that there is an impermissible conflict of interest. Reliance is placed on the Solicitors Code of Conduct 2007. Rule 3 precludes a solicitor from acting (without informed consent) where there is a conflict of interests defined as existing where, inter alia, the solicitor or his firm owes separate duties to act in the best interests of two or more clients in relation to the same or related matters, and those duties conflict, or there is a significant risk that those duties may conflict. Mr Allen further submits that there is no sufficient Chinese wall between SASO and the remainder of the Treasury Solicitors Office to enable reliance on that possibility, which was discussed in the House of Lords in Prince Jefri Bolkiah v KPMG [1999] 2 AC 222. In my opinion, these objections also fail. As to the former, the Treasury Solicitor does not have two clients and is not in breach of the professional code. The special advocate is an independent (security cleared) member of the bar or solicitor advocate, who is not professionally engaged by or on behalf of Mr Tariq, though he or she is charged to represent Mr Tariqs interests. As the Special Advocates Guide states (para 113): Actual conflicts of interest in the usual sense do not arise, since a special advocate owes no duty to the person whose interests he represents. However, a special advocate should be careful to ensure that no situation arises in which there could be any perception of anything other than absolute independence on his part. The Guide then reminds special advocates of the need for care to avoid any perceived conflict of interest when undertaking the role as well as in the future. SASO, which supports special advocates, operates for all practical purposes as a separate unit, with an established Chinese wall arrangement dividing it from the rest of the Treasury Solicitors Office. Maurice Kay LJ set out the position (para 30): SASO was set up in 2006 in response to the recommendation of the Constitutional Affairs Select Committee in its report on the operation of the Special Immigration Appeals Commission and use of SAs [special advocates] (7th report, session 2004 2005, 3 April 2005). The functions of SASO are described in Special Advocates A Guide to the Role of Special Advocates and the Special Advocates' Support Office, which is published on the Treasury Solicitor's Department's website. It is SASO that provides an SA with formal instructions. It also provides legal and administrative support to SAs and acts as the librarian of closed case law for them. Although formal instructions originate with SASO, it has no input into decisions such as whether to appeal a closed adverse judgment or to open part of a closed judgment. Such matters are for the independent judgment of the SA alone. Although SASO is physically located within the premises of the Treasury Solicitor at One Kemble Street, it has an established Chinese wall arrangement and is for all practical purposes a separate entity. It comprises five lawyers and three administrators. Four lawyers and two administrators form the SASO (closed) team, the remaining lawyer and administrator forming the SASO (open) team. The open team does not have security clearance. It alone communicates with the litigant's open representatives. Although other relevant litigation teams within the office of the Treasury Solicitor are able to share their facilities, this is not so in relation to SASO's resources and facilities. It has completely separate document handling, communication, storage and technology facilities. The four lawyers who carry out casework on cases in which the SAs are instructed do not carry out any work for any other part of the Treasury Solicitor's office. The fifth lawyer is at Grade 6 level. He does not have his own casework in relation to cases involving SAs. His role is more supervisory and he has a wider line management role which extends to the general private law litigation team. He may report to the Attorney General but only in relation to open issues in matters where SAs are instructed. In addition, in order to protect the independence of the SASO team, there are conflict checks to ensure that other members of the private law team do not act in cases which are in any way relevant to SASO. Mr Allen challenges the adequacy of this system. The information about its operation based on the Special Advocates Guide was amplified by a Home Office note produced during the Court of Appeal hearing. Mr Tariq invites scepticism about information provided in the context of litigation in which, he suggests, the Treasury Solicitor has an interest in the status quo. The information that SASO operates on a Chinese wall basis with the Treasury Solicitor teams who represent the Government in cases in which special advocates appear is however contained in the Special Advocates Guide (para 87). The arrangements described in both documents evidence a serious intention to achieve such a separation, and there is no reason to doubt their genuineness or efficacy. Significantly, as Maurice Kay LJ indicated in the passage quoted above, the position is that, although formal instructions originate with SASO, SASO has no input into special advocates decisions, which are taken only by the relevant independent special advocate. One can also be confident that, if any special advocate or court at any point suspected that the separation between SASO and other government legal teams was in any way incomplete, this would at once be brought to light. Maurice Kay LJ, based on his own experience, commented (para 32): If I may be permitted a subjective observation: if such problems were evident they would be expected to provoke adverse judicial comment but, in my experience, the system, although inherently imperfect, enjoys a high degree of confidence among the judges who deal with cases of this kind on a regular basis. In these circumstances, Mr Allen focuses on the fifth of the five SASO lawyers, a grade 6 lawyer who has no case work responsibility at all, but who does have a line management role in relation to both the SASO team and the Treasury Solicitors general private law team. He also chairs the monthly special advocates meetings at which cases and tactics are discussed, the minutes of which are sent to the Attorney Generals office, and he may occasionally brief the Attorney Generals office on open issues only. After pointing out that a person in Mr Tariqs position will instruct the special advocate before any closed material procedure begins, Mr Allen suggests that the description given of the grade 6 lawyers activity means that the content of such instructions could be shared with parts of the Treasury Solicitors office outside the SASO team or even with the Attorney General. I do not regard this as realistic. Substantive legal decisions are, as stated, taken by the special advocate. The grade 6 lawyer has no case work responsibility, and would not on the face of it be likely even to know of any instructions given by Mr Tariq. Even if he did know, disclosure to anyone outside the SASO team would involve a serious breach of his duty. There is no reason to think that minutes of the monthly meeting circulated to the Attorney Generals office would disclose such instructions, and the special advocate would presumably receive them and ensure that they did not. There is also no reason to think any briefing of the Attorney Generals office could or would go into detail about individual cases, still less about instructions given by Mr Tariq. It is clear that the Attorney General has no role and no detailed knowledge in relation to individual cases. In Prince Jefri Bolkiah v KPMG [1999] 2 AC 222 the House was concerned with accountants (KPMG) who were in possession of information confidential to a former client (Prince Jefri) which might be relevant to instructions which they then accepted from the Brunei Investment Agency, of which Prince Jefri had been chairman, to investigate the whereabouts of certain assets suggested to have been used by Prince Jefri for his own benefit. The House granted an injunction restraining KPMG from acting for the Agency. It held that the burden was on KPMG to show that there was no risk of the information coming into the possession of those within KPMG acting for the Agency. KPMG had attempted to erect a Chinese wall, but this was ad hoc and within a single department; further the two teams involved one which had acted for Prince Jefri and the one which was acting for the Agency contained large and rotating memberships of persons accustomed to working with each other. In these circumstances, the House held that, although there was no rule of law that Chinese walls or other similar arrangements were insufficient, nevertheless, to eliminate the risk, an effective Chinese wall needs to be an established part of the organisational structure of the firm, not created ad hoc and dependent on the acceptance of evidence sworn for the purpose by members of staff engaged on the relevant work (per Lord Millett, at p 239D E). The present case falls into an opposite category. SASO has a small team which works separately under arrangements which are not ad hoc, but well established, and it uses the services of independent outside special advocates, who can be relied upon to reinforce the culture and reality of such separation. There is no reason to doubt the genuineness and efficacy of the Chinese wall which has been set up in this way to service special advocates needs, in particular by providing assistance described in para 90 of the Special Advocates Guide. Mr Allen makes other further criticisms of the arrangements for special advocates: he submits that special advocates lack supervision, that there is insufficient guidance as to their role and that they lack any or sufficiently defined powers in respect of matters such as disclosure, the calling and cross examination of witnesses and appeal. I do not regard these criticisms as well founded or as rendering the whole closed material procedure unfair. Special advocates are experienced independent practitioners, accustomed to act of their own initiative and to take difficult decisions, and able to raise points of doubt or difficulty with the tribunal or court before which they appear. The special advocates role is familiar in a variety of contexts. It has been extensively described in the Special Advocates Guide. It divides into two parts, the open and closed. The Guide notes that throughout the open part, where the parties are exchanging open material, the special advocate will have the opportunity to meet the person in whose interests he or she is to act and to obtain as good an understanding as possible of his or her case (paras 99 100). Once the open stages have been completed the Secretary of State will serve his or her closed material upon the special advocate only (paras 101 102). The Guide goes on (para 102): The receipt of closed material marks the end of the period in which the special advocate may communicate directly with the appellant. It should be noted that communication with the appellant is still possible at this point but any communication from the special advocate to the appellant after this time requires the permission of the Court and the proposed format of it must be notified to the Secretary of State who can make objections if he so wishes (see SIAC Rule 36(4) and CPR 76.25(4)). During the closed phase, the special advocates role was summarised by Sedley LJ in Murungaru v Secretary of State for the Home Department [2008] EWCA Civ 1015, [2009] INLR 180 in this way at para 17: The ways in which a special advocate will seek to represent the interests of an appellant are, first, to test by cross examination, evidence and argument the strength of the case for non disclosure. Secondly, to the extent that non disclosure is maintained, the special advocate is to do what he or she can to protect the interests of the appellant, a task which has to be carried out without taking instructions on any aspect of the closed material. In relation to the protection of the interests of the person in Mr Tariqs position in relation to disclosure after the closed phase has begun, the Guide amplifies the special advocates role (in the largely parallel context of his or her role in proceedings before SIAC) as follows (para 103): It is now for the special advocate to take a view himself on the material and to decide whether any of what is contained within the closed material should in fact be made open (and therefore be disclosed to the appellant) because its disclosure would not harm the public interest e.g. the material is already in the public domain or could not be regarded as damaging to national security or other public interests. Sometimes, the special advocate will submit that a summary or gist of the material could be safely disclosed to the appellant. The special advocate has a period after service of the closed material in which to consider and prepare written submissions on what, if any, of the 'closed' material should become open. These are known as rule 38 submissions in SIAC and rule 29 submissions in Control Order proceedings (although they are in fact governed by CPR 76.29). These submissions may also include requests to the Secretary of State for further information or documents to be provided to the special advocate. This period has usually in SIAC been a period of two to three weeks (although no period is specified see SIAC Rules rule 38(3)). In the CPR, similar provisions specify a period of two weeks for the special advocate to indicate whether he challenges the Secretary of state's assessment of what is open and what is closed (see rule 76.29(3)), though the Court may modify it in appropriate circumstances. With regard to the hearing on the merits, the special advocate will be present during the open part, when he or she will have the opportunity to observe how the case is put by counsel both for and against the person whose interests the special advocate will be protecting during the closed phase. The closed hearing will take place, and all but the special advocate and the Secretary of State will withdraw. I see no reason why a special advocate may not, where appropriate, take steps to call factual or expert evidence during the closed phase, if necessary applying for any necessary witness summons. The Guide is in my view correct in contemplating this (para 108): There is also a possibility that the special advocate may call his own witnesses. This latter has never, to date, been undertaken, certainly not in a SIAC context. There appears no reason in principle, however, why this should not be possible, and special advocates in proceedings in the High Court will have the considerable advantage of being able to call on both the remainder of the CPR (insofar as not disapplied) and on the inherent jurisdiction of the Court to achieve such an end. In its June 2005 Response to the Constitutional Affairs Select Committee's Report into the Operation of SIAC and the Use of Special Advocates, the Government acknowledged that it is, in principle, open to special advocates in SIAC appeals to call expert evidence. On any appeal, it is well established that the special advocate is able both to appear and represent an appellants interests in any closed phase of the appeal. Mr Allen suggests that the special advocates role in positively instituting an appeal in relation to events or decisions occurring during the closed phase is insufficiently clear. Again (and consistently with Maurice Kay LJs description in para 30, cited in para 50 above) I see no reason why the special advocates role should not embrace this. The special advocate may, with the courts permission, communicate with Mr Tariq, even after the closed phase has begun (para 50 above); the court would no doubt permit a special advocate to inform a person in Mr Tariqs position that there were closed matters which merited consideration on appeal, even though such matters could not in any way be disclosed. In this way, an appeal could be lodged to enable the special advocate to pursue such matters, although the subject matter and basis of the appeal would remain unknown to the person in Mr Tariqs position. Reference to the Court of Justice Mr Allen submits that the Supreme Court should refer to the Court of Justice points arising in this case on which European Union law is relevant. Article 267 of the Treaty on the European Union provides: The Court of Justice of the European Union shall have jurisdiction to give preliminary rulings concerning: (a) the interpretation of the Treaties; (b) the validity and interpretation of acts of the institutions, bodies, offices or agencies of the Union; Where such a question is raised before any court or tribunal of a Member State, that court or tribunal may, if it considers that a decision on the question is necessary to enable it to give judgment, request the Court to give a ruling thereon. Where any such question is raised in a case pending before a court or tribunal of a Member State against whose decisions there is no judicial remedy under national law, that court or tribunal shall bring the matter before the Court The principles of European Union law which arise for consideration in this case are clear. There must in particular be effective legal protection in respect of the rights not to be discriminated against which Mr Tariq invokes, and, so far as guidance is necessary, it is to be found for the relevant purposes in the European Convention on Human Rights and the case law of the European Court of Human Rights. The principles which the European Court of Human Rights would apply in the area of national security have been confirmed recently by the decision in Kennedy. The questions before the Supreme Court involve the application of such principles to the circumstances of this case, and in particular to the closed material procedure involving a special advocate which the Employment Tribunal has ordered. There is on this basis no question of interpretation of the European Treaties which calls for a reference under article 267 as explained by the Court of Justice in Case 283/81 Srl CILFIT v Ministry of Health [1982] ECR 3415. It is not the role of the Court of Justice to rule on the application of established general criteria to a particular provision or arrangement, which must be considered in the light of the particular circumstances of the case in question: compare Case C 237/02 Freiburger Kommunalbauten GmbH Baugesellschaft & Co KG v Hofstetter [2004] 2 CMLR 291, paras 21 23, explaining and distinguishing Joined Cases C 240/98 to 244/98 Ocano Grupo Editorial SA v Murciano Quintero [2002] 1 CMLR 1226. I add that, if Mr Tariq were to have cause for complaint about the application of the relevant legal principles as established by the European Convention on Human Rights, there will always exist the potential to seek redress in Strasbourg. The European Court of Human Rights is not limited to the examination of questions of interpretation or law arising under the Convention, but will re examine the fairness of their application as a whole in the light of the circumstances of the particular case. It follows that I would hold that the use of a closed material procedure before the Employment Tribunal was and is lawful in the present case, and dismiss Mr Tariqs appeal accordingly. The Home Offices appeal It is as well to bear in mind at the outset that the general nature of the Home Offices case has been communicated to Mr Tariq. It is that the Home Office was concerned in August 2006 that [Mr Tariq] could be vulnerable to an approach to determine if terrorist suspects had been flagged to the authorities or to smuggle prohibited items airside and that its decision to withdraw security clearance in December 2006 was based on [his] close association with individuals suspected of involvement in plans to mount terrorist attacks and on its view that association with such individuals might make him vulnerable to attempts to exert undue influence on [him] to abuse his position: para 5 above; Mr Tariq must be able to meet this case on a general basis, in particular, by disclosing and describing his relationship and the nature and extent of his association with those of his relatives suspected and his cousin who was ultimately convicted of terrorist activity; and he has, further, on the basis of, in particular, his questioning in interview also been able to mount a sufficiently arguable case of discrimination to avoid any application to strike out his claim: para 6 above. What is in issue is the declaration made by the Employment Appeal Tribunal and upheld by the Court of Appeal to the effect that article 6 of the European Convention on Human Rights requires [Mr Tariq] to be provided with the allegations being made against him in sufficient detail to enable him to give instructions to his legal team so that those allegations can be challenged effectively: para 3 above. This is worth repeating, because some language used in the Court of Appeal might suggest that Mr Tariq knew nothing at all of the nature of the case against him, as opposed to particular allegations supporting it. Thus, for example, Maurice Kay LJ said that, although a closed material procedure was in principle justified, it was none the less the right of a litigant to know the essence of the case against him, if necessary by gisting ([2010] ICR 1034, para 43). He went on to acknowledge that, in a particular case, this may put the public authority in the invidious position of having to make difficult decisions about disclosure and whether or how a claim is to be defended, but said that all that is for the future in this litigation. It is the consequence of the requirements of justice. The Home Office by its appeal challenges this conclusion, pointing out that it raises directly the dilemma addressed by the Court of Appeal in the case of Carnduff v Rock [2001] EWCA Civ 680, [2001] 1 WLR 1786. If the disclosure of material would harm national security, but without disclosure the public authority could not defend and would have to capitulate, the claim itself may not be justiciable. The appeal raises the question whether there is an absolute requirement that a claimant should him or herself see and know the allegations forming the basis of the states defence in sufficient detail to give instructions to the defence legal team to enable the allegations to be challenged effectively. One problem about the declaration made by the Employment Appeal Tribunal and upheld by the Court of Appeal is that it is questionable whether or how far it differs in any significant way from the ordinary duty of any party in any litigation to disclose the nature of its factual allegations, where no issue of national security arises at all. A second point is that the declaration made does not correspond with any requirement expressed in section 7 of the Employment Tribunals Act 1996 or in the language of the statutory instruments made under that Act. But the submission is no doubt that, if the Convention requires gisting of the nature declared in every case, even though this could damage national security, then the court should under section 3 of the Human Rights Act 1998 find it possible to read into the Employment Tribunals Act 1996 and the ET Procedure Rules and ET National Security Rules introduced under it, some qualification to enable such gisting to occur. The question is therefore whether there is in the European Convention on Human Rights, as explained by the European Court of Human Rights, any such absolute requirement, where this would involve the disclosure to Mr Tariq of the detail of allegations which would in normal litigation require to be disclosed, but which the interests of national security require to be kept secret. Clearly, it is a very significant inroad into conventional judicial procedure to hold a closed material procedure admissible, if it will lead to a claimant not knowing of such allegations in such detail. As the Home Office acknowledges, it is an inroad which should only ever be contemplated or permitted by a court, if satisfied after inspection and full consideration of the relevant material as well as after hearing the submissions of the special advocate, that it is essential in the particular case; and this should be kept under review throughout the proceedings. However, to say that it is not possible under the Convention as interpreted by the Court in Strasbourg is in my view impossible, in the light of the clear line of jurisprudence culminating in the Courts decision in Kennedy which I have already discussed in paras 27 to 37 above. It is significant that, when the Court of Appeal reached its decision, it did not have the benefit of Kennedy. I would therefore allow the Home Offices appeal, and set aside the declaration made below to the effect that there exists an absolute requirement that Mr Tariq personally or his legal representatives be provided with sufficient detail of the allegations made against him to enable him to give instructions to his legal representatives on them. As I have indicated, both Mr Tariq and his legal representatives already know of the general nature of the Home Offices case. The Employment Tribunal will, with the assistance of the special advocate, keep under review and will be able to determine whether any and what further degree of gisting of the Home Offices case, or of disclosure regarding the detail of allegations made in support of it, is required, having regard to (a) the nature of the relevant allegations and of the national security interest in their non disclosure and in the light of its best judgment as to (b) the significance of such allegations for the Home Offices defence and (c) the significance for Mr Tariqs claim of the disclosure or non disclosure of such allegations to him. Employment Tribunals Act 1996, section 10 ANNEX (judgment, para 9) (5) Employment tribunal procedure regulations may make provision enabling a Minister of the Crown, if he considers it expedient in the interests of national security (a) to direct a tribunal to sit in private for all or part of particular Crown employment proceedings; (b) to direct a tribunal to exclude the applicant from all or part of particular Crown employment proceedings; (c) to direct a tribunal to exclude the applicant's representatives from all or part of particular Crown employment proceedings; (d) to direct a tribunal to take steps to conceal the identity of a particular witness in particular Crown employment proceedings; (e) to direct a tribunal to take steps to keep secret all or part of the reasons for its decision in particular Crown employment proceedings. (6) Employment tribunal procedure regulations may enable a tribunal, if it considers it expedient in the interests of national security, to do in relation to particular proceedings before it anything of a kind which, by virtue of subsection (5), employment tribunal procedure regulations may enable a Minister of the Crown to direct a tribunal to do in relation to particular Crown employment proceedings. (7) In relation to cases where a person has been excluded by virtue of subsection (5)(b) or (c) or (6), employment tribunal procedure regulations may make provision (a) for the appointment by the Attorney General . of a person to represent the interests of the applicant; . The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (SI 2004/1861) Schedule 1 The Employment Tribunals Rules of Procedure 54(1) A Minister of the Crown (whether or not he is a party to the proceedings) may, if he considers it expedient in the interests of national security, direct a tribunal or Employment Judge by notice to the Secretary to: (a) conduct proceedings in private for all or part of particular Crown employment proceedings; (b) exclude the claimant from all or part of particular Crown employment proceedings; (c) exclude the claimant's representative from all or part of particular Crown employment proceedings; (d) take steps to conceal the identity of a particular witness in particular Crown employment proceedings. (2) A tribunal or Employment Judge may, if it or he considers it expedient in the interests of national security, by order (a) do in relation to particular proceedings before it anything which can be required by direction to be done in relation to particular Crown employment proceedings under paragraph (1); (b) order any person to whom any document (including any judgment or record of the proceedings) has been provided for the purposes of the proceedings not to disclose any such document or the content thereof: (i) to any excluded person; (ii) in any case in which a direction has been given under [sub ]paragraph (l)(a) or an order has been made under [sub ]paragraph (2)(a) read with sub paragraph (1)(a), to any person excluded from all or part of the proceedings by virtue of such direction or order; or (iii) in any case in which a Minister of the Crown has informed the Secretary in accordance with paragraph (3) that he wishes to address the tribunal or Employment Judge with a view to an order being made under sub paragraph (2)(a) read with sub paragraph (l)(b) or (c), to any person who may be excluded from all or part of the proceedings by virtue of such an order, if an order is made, at any time before the tribunal or Employment Judge decides whether or not to make such an order; (c) take steps to keep secret all or part of the reasons for its judgment. The tribunal or Employment Judge (as the case may be) shall keep under review any order it or he has made under this paragraph. (3) In any proceedings in which a Minister of the Crown considers that it would be appropriate for a tribunal or Employment Judge to make an order as referred to in paragraph (2), he shall (whether or not he is a party to the proceedings) be entitled to appear before and to address the tribunal or Employment Judge thereon. The Minister shall inform the Secretary by notice that he wishes to address the tribunal or Employment Judge and the Secretary shall copy the notice to the parties. (4) When exercising its or his functions, a tribunal or Employment Judge shall ensure that information is not disclosed contrary to the interests of national security. The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 Schedule 2 The Employment Tribunals (National Security) Rules of Procedure 8 Special advocate (1) In any proceedings in which there is an excluded person the tribunal or Employment Judge shall inform the Attorney General of the proceedings before it with a view to the Attorney General , if he thinks it fit to do so, appointing a special advocate to represent the interests of the claimant in respect of those parts of the proceedings from which (a) any representative of his is excluded; (b) both he and his representative are excluded; or (c) he is excluded, where he does not have a representative. (2) A special advocate shall have a general qualification for the purposes of section 71 of the Courts and Legal Services Act 1990 or shall be an advocate or a solicitor admitted in Scotland. (3) Where the excluded person is the claimant, he shall be permitted to make a statement to the tribunal or Employment Judge before the commencement of the proceedings, or the part of the proceedings, from which he is excluded. (4) Except in accordance with paragraphs (5) to (7), the special advocate may not communicate directly or indirectly with any person (including an excluded person) (a) (except in the case of the tribunal, Employment Judge and the respondent) on any matter contained in the grounds for the response referred to in rule 3(3); (b) (except in the case of a person who was present) on any matter discussed or referred to during any part of the proceedings in which the tribunal or Employment Judge sat in private in accordance with a direction or an order given or made under rule 54. (5) The special advocate may apply for orders from the tribunal or Employment Judge authorising him to seek instructions from, or otherwise to communicate with, an excluded person (a) on any matter contained in the grounds for the response referred to in rule 3(3); or (b) on any matter discussed or referred to during any part of the proceedings in which the tribunal or Employment Judge sat in private in accordance with a direction or an order given or made under rule 54. (6) An application under paragraph (5) shall be made in writing to the Employment Tribunal Office and shall include the title of the proceedings and the grounds for the application. (7) The Secretary shall notify the Minister of an application under paragraph (5) and the Minister shall be entitled to address the tribunal or Employment Judge on the application. (8) In these rules and those in Schedule I, in any case in which a special advocate has been appointed to represent the interests of the claimant in accordance with paragraph (I), any reference to a party shall (save in those references specified in paragraph (9)) include the special advocate. 10 Reasons in national security proceedings (1) This rule applies to written reasons given under rule 30 of Schedule 1 for a judgment or order made by the tribunal or Employment Judge in national security proceedings. (2) Before the Secretary sends a copy of the written reasons ('the full written reasons') to any party, or enters them in the Register under rule 32 of Schedule I, he shall send a copy of the full written reasons to the Minister. (3) If the Minister considers it expedient in the interests of national security and he has given a direction or the tribunal or an Employment Judge has made an order under rule 54 in those proceedings, the Minister may (a) direct the tribunal or Employment Judge that the full written reasons shall not be disclosed to persons specified in the direction, and to prepare a further document ('the edited reasons') setting out the reasons for the judgment or order, but with the omission of such of the information as is specified in the direction; (b) direct the tribunal or Employment Judge that the full written reasons shall not be disclosed to persons specified in the direction, but that no further document setting out the tribunal or Employment Judge's reasons should be prepared. (4) Where the Minister has directed the tribunal or Employment Judge in accordance with sub paragraph 3(a), the edited reasons shall be signed by the Employment Judge and initialled in each place where an omission has been made. (5) Where a direction has been made under sub paragraph (3)(a), the Secretary shall (a) send a copy of the edited reasons referred to in subparagraph (3)(a) to any person specified in the direction and to the persons listed in paragraph (7); (b) enter the edited reasons in the Register, but omit from the Register the full written reasons; and (c) send a copy of the full written reasons to the persons listed in paragraph (7). (6) Where a direction has been made under sub paragraph (3)(b), the Secretary shall send a copy of the full written reasons to the persons listed in paragraph (7), but he shall not enter the full written reasons in the Register. (7) The persons to whom full written reasons should be sent in accordance with paragraph (5) or (6) are (a) the respondent; (b) the claimant or the claimant's representative if they were not specified in the direction made under paragraph (3); (c) if applicable, the special advocate; (d) where the proceedings were referred to the tribunal by a court, to that court; and (e) where there are proceedings before a superior court (or in Scotland, an appellate court) relating to the decision in question, to that court. The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 Regulation 2 Definitions excluded person means, in relation to any proceedings, a person who has been excluded from all or part of the proceedings by virtue of: (a) a direction of a Minister of the Crown under rule 54(1)(b) or (c) of Schedule 1, or (b) an order of the tribunal under rule 54(2)(a) read with 54(1)(b) or (c) of Schedule 1; national security proceedings means proceedings in relation to which a direction is given under rule 54(1) of Schedule 1, or an order is made under rule 54(2) of that Schedule; special advocate means a person appointed in accordance with rule 8 of Schedule 2 . LORD HOPE I agree that, for the reasons so fully set out by Lord Mance in his judgment and the further reasons given by Lord Brown and Lord Dyson, the appeal by the Home Office should be allowed and that the cross appeal by Mr Tariq should be dismissed. At the heart of both the appeal and the cross appeal are two principles of great importance. They pull in different directions. On the one hand there is the principle of fair and open justice. As OConnor J declared in Hamdi v Rumsfeld 542 US 507 (2004), 533, parties whose rights are to be affected are entitled to be heard and in order that they may enjoy that right they must first be notified. In European Convention terms, this is the principle of equality of arms which is part of the wider concept of a fair trial: Kennedy v United Kingdom (Application No 26839/05) (unreported) 18 May 2010, para 184. On the other there is the principle that gives weight to the interests of national security. This is one of the legitimate aims referred to in articles 8(2), 10(2) and 11(2) of the Convention. The extent of the discretion that must be accorded to the national authorities in this field was recognised in Leander v Sweden (1987) 9 EHHR 433, para 59. National security was described as a strong countervailing public interest in Kennedy, para 184. But it must be weighed against the fundamental right to a fair trial. The context will always be crucial to a resolution of questions as to where and how this balance is to be struck. Mr Tariq was employed by the Home Office in a capacity for which security clearance was required in the interests of national security. To be effective security vetting will usually, if not invariably, require to be carried out in secret. Its methods and the sources of information on which it depends cannot be revealed to the person who is being vetted. Those who supply the information must be able to do so in absolute confidence. In some cases, their personal safety may depend on this. The methods, if revealed to public scrutiny, may become unusable. These are the unusual circumstances in which the claim Mr Tariq seeks to make in this case must be determined. Mr Tariqs complaint against the Home Offices decision to suspend his security clearance is that it was based on grounds that amounted to direct or indirect discrimination against him on grounds of his race and religion. There is no doubt that he is entitled to a fair and public hearing in the relevant tribunal of his claim that the rights conferred on him by the Race Relations Act 1976 and the Employment Equality (Religion or Belief) Regulations 2003 (SI 2003/1660) have been breached. The principle of equal treatment is part of European Union law, but it is for national law to ensure that the right to a fair hearing is respected according to the principles established under the European Convention. By section 10(6) of the Employment Tribunals Act 1996 it is provided that the employment tribunal procedure regulations may enable a tribunal, if it considers it expedient in the interests of national security, to adopt a closed procedure. Section 10(7) of the 1996 Act provides that the procedure regulations may make provision in that event for the appointment by the Attorney General of a special advocate to represent the interests of the applicant. The provisions that were made in the exercise of that power are to be found in the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (SI 2004/1861). Rule 54 of Schedule 1 to the Regulations provides for the use of closed procedure, and rule 8 of Schedule 2 provides for the appointment of special advocates. No one doubts Mr Tariqs right not to be discriminated against on grounds of his race or his religion. But it was his own choice to seek employment in a post for which, in the interests of national security, security clearance was required. He was a volunteer, not a conscript. This is not a case where he is the victim of action taken against him by the state which deprived him of his fundamental rights. Furthermore, as I have already indicated, security vetting is a highly sensitive area. Its intensity will no doubt vary from case to case, but common to them all is the need to preserve the integrity of sources of information and the methods of obtaining it. That must always be the paramount consideration, whatever the nature of the proceedings in which the issue arises. It ensures that the national interest is protected when people are appointed to posts where security clearance is required. Issues of employment and discrimination law raised by people appointed to those posts may require access to the way this process has been carried out. It was no doubt for that reason that the use of the closed procedure and the appointment of special advocates was expressly authorised by the statute. The question then is whether the difficulties that Mr Tariq faces in making good his discrimination claim are sufficiently counterbalanced by the procedures that the Home Office wishes the employment tribunal to adopt. First, there is the use of the closed procedure for the consideration of the material on which the Home Office wishes to rely in its defence. Is the procedure that the Regulations have prescribed for use in national security cases compatible with European Union law? This is the point raised by Mr Tariqs cross appeal. Second, if the use of the closed procedure is lawful, how is it to be applied in this case? Is the Home Office obliged to give sufficient detail of the material on which it relies to enable Mr Tariq to give detailed instructions to his special advocate to enable that material to be challenged effectively? This is the point raised by its appeal. The Court of Appeal held that the principle illustrated by Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28, [2010] 2 AC 269 must apply. This was despite the fact that this would put the Home Office in the invidious position of having to make decisions as to whether, and if so how, the claim was to be defended: [2010] EWCA Civ 462, [2010] ICR 1034, para 50. I have found the second issue more troublesome than the first. As to the first, which is the issue raised in Mr Tariqs cross appeal, the question is whether the use of the closed procedure in cases of this type impairs the very essence of his right to a fair trial. The right to a fair trial itself is an absolute right, but rights that are to be implied from article 6 of the European Convention are not: Brown v Stott [2003] 1 AC 681, 719. Their purpose is to give effect, in a practical way, to the fundamental right. The right to a fair hearing must ordinarily carry with it the right to have proceedings conducted in open court, with full disclosure by both sides. But, for the reasons already mentioned, the use of an open procedure where details of the security vetting process are in issue cannot be resorted to without risk to the integrity of the system which in the national interest must be preserved. The observations of the Court of Justice in Joined Cases C 402/05P and C 415/05P Kadi v Council of the European Union [2009] AC 1225, para 344 indicate that European law is willing to accept a closed material procedure in the interests of national security so long as the individual is accorded a sufficient measure of procedural justice. That this is the position that the Strasbourg court too has adopted is amply demonstrated by its decisions in Kennedy v United Kingdom, paras 184 190. Parliament has expressed a clear democratic judgment that the tribunal may in its discretion make use of the closed procedure with the assistance of a special advocate. As for the procedure that the 2004 Regulations provide for, several features indicate that the balance has been struck in the right place. First, there is the fact that, under the procedure provided for by rule 54(2) of Schedule 1 to the Regulations, the decision as to whether closed procedure should be resorted to rests with the tribunal or the employment judge. The fact that the decision is taken by a judicial officer is important. It ensures that it is taken by someone who is both impartial and independent of the executive. Second, there is the fact that, as this is a judicial decision, it will not be taken without hearing argument in open court from both sides. It will be an informed decision, not one taken without proper regard to the interests of the individual. Third, it opens the door to the use of the special advocate. Fourth, it is a decision that can and should be kept under review as the case proceeds: see the last sentence of rule 54(2). Fifth, the special advocate can and should be heard as the process of keeping it under review proceeds. As against all that, account must be taken of the consequences for national security if this procedure were not to be available to the tribunal. Without it, there would be a stark choice: to conduct the entire defence in open proceedings however damaging that might be to the system of security vetting, and in particular to those who contributed to it in this case; or to concede the case and accept the consequences. They would not only be financial. They would lead to the government being seen as an easy target for unjustified claims. That would be a field day for the unscrupulous. They could lead to tensions if those who were in a position to make discrimination claims were thought to be enjoying an unfair advantage because their claims were not likely to be contested if they were to be pressed to the point of a public hearing. I think that the balance lies firmly in favour of allowing the tribunal, in its discretion, to make use of the closed procedure. I would dismiss the cross appeal. As for the second issue, there is a very real problem. Procedural justice indicates that Mr Tariq should be given sufficient information to enable him to give detailed instructions to his special advocate so that she can challenge the withheld material on his behalf. But Mr Eadie QC for the Home Office insists that the process of gisting as envisaged in Secretary of State for the Home Department v AF (No 3) [2010] 2 AC 269 cannot be resorted to in this case without risk to those who were involved in the security vetting process. In the AF (No 3) case I said that what would be needed would vary from case to case, and that the judge would be in the best position to strike the balance between what was needed to enable the special advocate to challenge the case against the individual and what could properly be kept closed: para 86. But I also said that if the concept of an effective challenge was to be applied, where detail matters it must be met by detail: para 87. That is what Mr Eadie objects to in this case. Here again the context for the argument is what matters. This is an entirely different case from Secretary of State for the Home Department v AF (No 3). There the fundamental rights of the individual were being severely restricted by the actions of the executive. Where issues such as that are at stake, the rule of law requires that the individual be given sufficient material to enable him to answer the case that is made against him by the state. In this case the individual is not faced with criminal proceedings against him or with severe restrictions on personal liberty. This is a civil claim and the question is whether Mr Tariq is entitled to damages. He is entitled to a fair hearing of his claim before an independent and impartial tribunal. But the Home Office says that it cannot defend the claim in open proceedings as, for understandable reasons, it cannot reveal how the security vetting was done in his case. That conclusion is unavoidable, given the nature of the work Mr Tariq was employed to do. How then is the balance to be struck here? Mr Tariq will be at a disadvantage if the closed procedure is adopted. But the disadvantage to the Home Office is greater, as unless the closed procedure is adopted it will have to concede the claim. There is no way that the disadvantage to the Home Office can be minimised. It will simply be unable to defend itself. It will be unable to obtain a judicial ruling on the point at all. That would plainly be a denial of justice. The disadvantage to Mr Tariq, on the other hand, is less clear cut. He is not entirely without information, as the general nature of the Home Offices case has been disclosed to him. He will have the services of the special advocate, with all that that involves second best by far, no doubt, but at least the special advocate will be there. His claim will be judicially determined by an independent and impartial tribunal, which can be expected to take full account of the fact that the details of the case for the Home Office have had to be kept closed. If inferences have to be drawn because of the quality or nature of the evidence for the Home Office, they will have to be drawn in Mr Tariqs favour and not against him. And throughout the process the need for the evidence to be kept closed will be kept under review as rule 54 of Schedule 1 to the Regulations requires, with the assistance of the special advocate. There cannot, after all, be an absolute rule that gisting must always be resorted to whatever the circumstances. There are no hard edged rules in this area of the law. As I said at the beginning, the principles that lie at the heart of the case pull in different directions. It must be a question of degree, balancing the considerations on one side against those on the other, as to how much weight is to be given to each of them. I would hold that, given the nature of the case, the fact that the disadvantage to Mr Tariq that the closed procedure will give rise to can to some extent be minimised and the paramount need to protect the integrity of the security vetting process, the balance is in favour of the Home Office. I would allow the appeal. LORD BROWN I have read Lord Mances comprehensive judgment and, like him, would allow the Home Offices appeal and dismiss Mr Tariqs cross appeal. As to the cross appeal the question whether a closed material procedure in the employment tribunal can ever be compatible with the Race Directive and the Equal Treatment Framework Directive there is almost nothing I wish to add to Lord Mances judgment. To my mind plainly it can. The submission that it is never necessary for reasons of national security to deploy secret evidence in employment tribunal discrimination proceedings because instead the government can simply pay up I find not merely unpersuasive but wholly preposterous. Is it seriously to be suggested that, however unmeritorious such claims may be, the complainant should simply be paid off? Taxpayers money aside, consider the appalling consequences for the governments reputation were there to be a succession of findings of unlawful racial or religious discrimination and the insidious effect of all this upon relations between different racial groups. As for the appeal in effect the question whether a complainant in Mr Tariqs position has to be provided with sufficient details of the allegations being made against him (however sensitive the information on which they are based) to enable him to give instructions to his special advocate in order effectively to challenge them I conclude no less clearly that this is not required. On this question, however, I wish to add a few further thoughts of my own. It is, as I understand it, Mr Tariqs case on the appeal apparently supported by Mr John Howell QC for JUSTICE and Liberty that, assuming (contrary to his primary case) that a closed material procedure is available at all in employment tribunal proceedings, the complainant has exactly the same rights to be provided with sufficient information about the allegations against him to enable him to give effective instructions to the special advocate as the Grand Chamber in A v United Kingdom (2009) 49 EHRR 625 (at para 220) decided had to be given to those deprived of their liberty at Belmarsh Prison pursuant to the Anti terrorism, Crime and Security Act 2001. For simplicitys sake I shall call this degree of disclosure A type disclosure. As is well known, the nine Members of the House of Lords sitting in Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28, [2010] 2 AC 269 unanimously held that A type disclosure was similarly required in control order cases under the regime established by the Prevention of Terrorism Act 2005 in place of the detention regime. Substantially relying on A and on AF (No 3), Mr Allen QC submits that in any special advocate context to which article 6 applies, there is required an irreducible minimum standard of fairness which in every case demands A type disclosure. Prominent amongst the passages prayed in aid from the AF (No 3) judgments are, to my considerable surprise, these from my own judgment: . the suspect must always be told sufficient of the case against him to enable him to give effective instructions to the special advocate, notwithstanding that sometimes this will be impossible and national security will thereby be put at risk (para 116). Plainly there now is a rigid principle. Strasbourg has chosen in para 220 of A to stipulate the need in all cases to disclose to the suspect enough about the allegations forming the sole or decisive grounds of suspicion against him to enable him to give effective instructions to the special advocate (para 119). The argument, notwithstanding its apparent acceptance by the Court of Appeal, is to my mind unsustainable. As all the judgments in AF (No 3), my own not least, made plain, the Grand Chambers judgment in A was to be regarded as indistinguishable simply because of the striking similarities between the two situations then under consideration: Belmarsh detention and the control order regime. To suggest that the identical rigid principle will be imported into every situation where article 6 applies notwithstanding that sometimes this [A type disclosure] will be impossible and national security will thereby be put at risk is absurd. It is, indeed, to re assert here the very argument already rejected in relation to the cross appeal: the argument that, if giving effect to A type disclosure will compromise national security, then it is always open to government instead to pay up. True it is that in the control order context, government has on a number of occasions since AF (No 3) chosen to abandon the control order rather than make the necessary degree of disclosure. That, however, is a far cry from recognising that governments should face the same dilemma in the context of a monetary claim for discrimination. Although the Court of Appeal did not regard these cases as being in a different category (para 50 of Maurice Kay LJs judgment below), for my part I strongly disagree. Not merely, moreover, is there no support for Mr Allens argument to be found in our domestic jurisprudence but, as Lord Mance convincingly demonstrates, it is now clearly belied by a series of Strasbourg decisions culminating most recently and most decisively in Kennedy v United Kingdom (Application No 26839/05) (unreported) 18 May 2010. Kennedy concerned a complaint, largely on article 6 grounds, against the ruling of the Investigatory Powers Tribunal (IPT) made on 23 January 2003 as to the legality of various of their rules. A sufficient description of the highly restrictive nature of these rules is to be found at paras 7 and 25 of my judgment in this Court in R (A) v Director of Establishments of the Security Service [2009] UKSC 12, [2010] 2 AC 1 (at paras 8 and 30 of which I noted that the IPTs own decision on these rules was shortly to be considered by the European Court of Human Rights, as now it has been in Kennedy). The Court in Kennedy assumed (at para 179 of its judgment) that article 6 applies to proceedings before the IPT and then, at paras 181 190 of its judgment (cited by Lord Mance at paras 34 and 35 above) comprehensively rejected the claim that it had been violated. There could hardly be a clearer example of a procedure being held compliant with article 6 notwithstanding the conspicuous absence of anything approaching A type disclosure. The final comments I wish to make in the appeal are these. Security vetting by its very nature often involves highly sensitive material. As an immigration officer, Mr Tariq required security clearance to a comparatively high level (above that of a counter terrorist check albeit below that of developed vetting). Immigration officers require long term, frequent and controlled access to secret information and assets. It is surely, therefore, not altogether surprising that, upon his brothers and his cousins arrest and more particularly since his cousins conviction and life sentence for conspiracy to murder arising out of a terrorist plot to attack transatlantic flights from Heathrow he has been suspended from duty (albeit continuing to be paid) and his security clearance withdrawn. No one suggests that Mr Tariq himself was involved in the plot. What is suggested, however, is that he could be vulnerable to pressures from someone in his community to abuse his position as an immigration officer. Mr Tariq submitted an internal appeal against the Departmental Security Officers decision to withdraw his security clearance but this was dismissed by the Permanent Secretary of the Home Office (following his consideration of a full report from the Director of Human Resource Services). Mr Tariq then made a further appeal to the Security Vetting Appeals Panel (SVAP) (presided over by a retired High Court judge) which held both open and closed hearings, with a special advocate appointed for the closed hearings, and which as recently as January 2011 dismissed the appeal. (No objection is taken to the SVAPs use of a closed procedure and special advocate, apparently on the basis that it was bound to use such a procedure and that in any event its decision on the appeal is solely advisory, the department being free to ignore it.) We know nothing of the underlying facts of this case. Assume, however, in a case like the present that someone in the employees community (perhaps a relative or associate) has given information in confidence to those responsible for reviewing the employees security clearance which is detrimental to his case. Perhaps it belies assurances he has given as to the limited nature and extent of his contacts with those suspected of terrorist activity. It surely goes without saying that nothing of this could properly be disclosed to the employee beyond perhaps telling him that the department was not satisfied with the assurances he has given. To give chapter and verse of any inconsistencies between those assurances and the information given to the department would be to betray the information provided and quite likely put its provider at risk. Similar considerations could well apply even in respect of an initial vetting procedure. Is it really sensible, one cannot help wondering, to attempt to force disputes in such cases as these into the comparative straitjacket of employment tribunal proceedings. Even if it is, is it sensible to operate in parallel two sets of proceedings, both with closed procedures and special advocates, one before the SVAP, the other before the Employment Tribunal. Of course I recognise that the issues they are determining are not identical. But there must inevitably be some substantial overlap between them and the effort, time and expense involved in all this hardly bears thinking about. In my judgment in R (A) v Director of Establishments of Security Service (at paras 34 and 35) I expressly contemplated that in certain circumstances the IPTs exclusive jurisdiction might with advantage be widened. True, I was not considering a case like the present. I seriously wonder, however, whether it might not be wise to channel all disputes arising in security vetting cases to a single tribunal if not the IPT itself, then a body sharing some at least of its characteristics. That, however, is a thought for the future perhaps for consideration in relation to a Green Paper we are told will be published later this year with regard to possible ways of resolving, or at least mitigating, the undoubted problems faced by Government in litigation raising sensitive security issues. LORD KERR Introduction On 14 February 2008 the Employment Tribunal dealing with Mr Tariqs case sent to the minister a copy of the reasons it proposed to give for making its order under rule 54 of the First Schedule to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (SI 2004/1861). It was required to do so by rule 10 of the Employment Tribunals (National Security) Rules 2004 which are contained in Schedule 2 to the 2004 Regulations. The reasons were amended by the minister (or, more probably, by someone acting on his behalf) and were eventually issued to the claimant and his advisers in their amended form on 15 October 2008. The reasons that the tribunal proposed to give Mr Tariq related to the way in which his case would be dealt with. They purported to explain why he and his representatives would be excluded from those parts of the proceedings at which closed evidence was to be given or closed documents were to be considered; why a special advocate was to be appointed to represent his interests in any part of the proceedings from which he and his representatives were to be excluded; and why the proceedings should be held entirely in private. As a means of explaining these matters to Mr Tariq, the reasons given were, to say the least, not informative. Para 10 encapsulated them. It stated: Having read the relevant documents and having heard submissions, I was satisfied that it was expedient in the interest of national security to make an order under rule 54 as set out in the separate document marked as Orders. I was further satisfied that it would be in the interest of the claimant if a special advocate were to be appointed for the matter to be further reviewed, as I am required to do, at the next case management discussion on 1 May 2008 when not only can the issues as to what documents should be in the closed and open bundles and what should be included in the closed and open witness statements be addressed but also any submissions from the special advocate in that regard at that case management discussion in the anticipation that there would have been such an appointment before then. Beyond saying that the decisions as to the way in which his case was to be heard had been taken for reasons of national security, this paragraph conveyed precisely nothing to the claimant. The paragraphs that had preceded it did little more. Apart from rehearsing the submissions that had been made by either party, they said virtually nothing. But that did not make them immune from the ministers blue pen. In para 5 of the reasons the tribunal had set out (in 5.1, 5.2 and 5.3) the Home Office submissions that the entire proceedings should be held in private; that Mr Tariq and his representative should be excluded while closed evidence or documents were being considered; and that the tribunal should consider both the closed evidence and closed documents and that these would be provided to a special advocate, if one was appointed. In its original form, the statement of reasons continued at para 6: The respondents made this application on the basis that given the circumstances and the relationship of the claimant to other parties involved in what was believed to be unlawful activities and the fact that he might have contact with them that there could be inadvertent disclosure by him of information that was either sensitive or classified. Now it should be noted that on 30 August 2006, the departmental security officer, Jacqueline Sharland, had met Mr Tariq and his union representative and she had then explained that the review of Mr Tariq's security clearance had been prompted by national security concerns and that these related to Mr Tariq's vulnerability. At that meeting Mr Tariq indicated that he understood that the withdrawal of his security clearance had occurred because his brother had been arrested. There was no demur from Ms Sharland to this suggestion. Despite this, in October 2008, more than two years later, the minister (or a civil servant acting on his behalf) felt that para 6 of the tribunals reasons required amendment. He directed that it should be changed so as to read as follows: The respondents made the applications at paras 5.1 5.3 above, on the basis that the material in the closed bundle provided to the tribunal was sensitive on grounds of national security and accordingly should not be disclosed to the claimant or his representative. So, although Mr Tariq had been informed by the departmental security officer that his security clearance had been reviewed because he was considered to be vulnerable, and although he had responded that he believed that that had happened because his brother had been arrested, the Home Office view was that it was necessary on national security grounds that he should not be told in October 2008 that others who were believed to be involved in unlawful activities might receive sensitive or classified information that he might inadvertently impart to them. It has never been explained why the view was taken that this information could not be disclosed. Mystifying though this is, the second change to the statement of reasons directed by the minister is even more inexplicable. This required the complete deletion of para 8 of the reasons. This paragraph had done no more than summarise an argument made on the respondents behalf in the presence of Mr Tariqs representative, an argument of which, therefore, it must be assumed, he was fully aware. It had stated: The respondents further maintained that due to the nature of the contact and the place of contact (the claimant's parents home at which he partially resided with his family during most week ends), it was inappropriate for all these matters to be disclosed on a public basis and that there were matters properly to be dealt with on a closed basis and for the hearing generally to be in private. Again no explanation for the decision to withhold this information has been given. It seems likely that its subsequent disclosure and the full revelation of what para 6 contained was brought about by representations made by the special advocate appointed to act on Mr Tariqs behalf. Lord Mance has said that this is an indication of one of the purposes that a special advocate may serve. It may very well amount to such an indication but the fact that the intervention of the special advocate was required to secure the release of material which ought never to have been withheld is, in my opinion, profoundly troubling. Lord Mance has suggested that the course of events about the disclosure of this information offers a cautionary message. It does more than that. It illustrates all too clearly the dangers inherent in a closed material procedure where the party which asks for it is also the repository of information on the impact that an open system will avowedly have on national security. The common law right to know and effectively challenge the opposing case The right to know and effectively challenge the opposing case has long been recognised by the common law as a fundamental feature of the judicial process. In Kanda v Government of Malaya [1962] AC 322, 337 Lord Denning said: If the right to be heard is to be a real right which is worth anything, it must carry with it a right in the accused man to know the case which is made against him. He must know what evidence has been given and what statements have been made affecting him: and then he must be given a fair opportunity to correct or contradict them. This appears in all the cases from the celebrated judgment of Lord Loreburn LC in Board of Education v Rice down to the decision of their Lordships Board in Ceylon University v Fernando. It follows, of course, that the judge or whoever has to adjudicate must not hear evidence or receive representations from one side made behind the back of the other. The centrality of this right to the fairness of the trial process has been repeatedly emphasised. Thus, in In re K (Infants) [1963] Ch 381 Upjohn LJ at pp 405 406 said: It seems to be fundamental to any judicial inquiry that a person or other properly interested party must have the right to see all the information put before the judge, to comment on it, to challenge it and if needs be to combat it, and to try to establish by contrary evidence that it is wrong. It cannot be withheld from him in whole or in part. If it is so withheld and yet the judge takes such information into account in reaching his conclusion without disclosure to those parties who are properly and naturally vitally concerned, the proceedings cannot be described as judicial. And in Brinkley v Brinkley [1965] P 75, 78 Scarman J said that for a court to take into consideration evidence which a party to the proceedings has had no opportunity during trial to see or hear, and thus to challenge, explain or comment upon, seems to us to strike at the very root of the judicial process. In Pamplin v Express Newspapers Ltd [1985] 1 WLR 689 at 691 Hobhouse J expressed the principle in similarly forthright terms: The first principle is the principle of natural justice which applies wherever legal proceedings involve more than one person and one party is asking the tribunal for an order which will affect and bind another. Natural justice requires that each party should have an equivalent right to be heard. This means that if one party wishes to place evidence or persuasive material before the tribunal, the other party or parties must have an opportunity to see that material and, if they wish, to submit counter material and, in any event, to address the tribunal about the material. One party may not make secret communications to the court. Exceptions to the rule that a party to the proceedings must be informed of every detail of his opponents case have, of course, been recognised. But it is essential to be aware of the starting point from which one must embark on the inquiry whether the principle of equality of arms (which is such a vital hallmark of our adversarial system of the trial of contentious issues) may be compromised. As a general indeed, basic rule, those who are parties to litigation need to know what it is that their opponent alleges against them. They need to have the chance to counter those allegations. If that vital entitlement is to be denied them, weighty factors must be present to displace it. And it is self evident that he who wishes to have it displaced must show that there are sufficiently substantial reasons that this should happen. Put shortly, he who thus avers must establish that nothing less will do. The case made on behalf of the appellant in this appeal has been stigmatised by the suggestion that it amounts to a claim that the state must accept that it should pay compensation even in those instances where the claimant is known to be wholly undeserving but it is impossible to adduce evidence that would establish this because of national security considerations. The respondent claimed and the majority have accepted that the law will not contemplate such a situation. In my view, however, this approach carries the danger of allowing the possible consequences of the implementation of the proper principle to effect a modification of the principle itself. So, because, it is said, the state, faced with the dilemma of having to choose between revealing the information on which it relies to defeat the claim and compromising national security by doing so, would be forced to settle the case, a better solution must be found. That better solution is that the state should be allowed to deploy the information on which the claim can be defeated but be absolved from the need to disclose it to the claimant. This solution, it is clear, is founded not on principle but on pragmatism. Pragmatic considerations, of course, have their part to play in the resolution of difficult legal conundrums but, I suggest, they have no place here. Where, as in this case, the challenged decision is the subject of factual inquiry or dispute and the investigation of the disputed facts centres on an individuals actions or, to bring the matter directly to the circumstances of this case, his supposed vulnerability, that individual is the critical source of information needed to discover the truth; in many cases he may be the only source. If he is denied information as to the nature of the case made either directly against him or, as seems more likely here, against others whose presumed relationship with the claimant renders it unsuitable for him to retain security clearance and if he is thereby forced to speculate on the content of the defendants case, no truly adversarial proceedings are possible. As Upjohn LJ put it in In re K, the proceedings are not judicial. The withholding of information from a claimant which is then deployed to defeat his claim is, in my opinion, a breach of his fundamental common law right to a fair trial. Even if the closed material procedure was compatible with article 6 of the European Convention on Human Rights (and for reasons that I will discuss presently, I do not believe that it is) this has no bearing on the appellants right at common law to be provided with details of the case against him sufficient to enable him to present a reasoned challenge to it. This courts endorsement of a principle of non disclosure whereby a party in civil proceedings may have withheld from him the allegations forming the basis of the opposing case is a landmark decision, marking a departure from the common laws long established commitment to this basic procedural right. In my view, the removal of that right may only be achieved by legislation and only then by unambiguous language that clearly has that effect. In R v Secretary of State for the Home Department, Ex p Simms [2000] 2 AC 115, dealing with Parliaments power to legislate contrary to fundamental human rights, Lord Hoffmann at p 131 said: Parliamentary sovereignty means that Parliament can, if it chooses, legislate contrary to fundamental principles of human rights. The Human Rights Act 1998 will not detract from this power. The constraints upon its exercise by Parliament are ultimately political, not legal. But the principle of legality means that Parliament must squarely confront what it is doing and accept the political cost. Fundamental rights cannot be overridden by general or ambiguous words. This is because there is too great a risk that the full implications of their unqualified meaning may have passed unnoticed in the democratic process. In the absence of express language or necessary implication to the contrary, the courts therefore presume that even the most general words were intended to be subject to the basic rights of the individual. In this way the courts of the United Kingdom, though acknowledging the sovereignty of Parliament, apply principles of constitutionality little different from those which exist in countries where the power of the legislature is expressly limited by a constitutional document. Although that statement of principle was made in the context of legislation overriding human rights, it applies with equal force to legislation affecting other constitutional rights such as arise in this case. In R (Anufrijeva) v Secretary of State for the Home Department [2003] UKHL 36, [2004] 1 AC 604, at para 27 Lord Steyn said of Lord Hoffmanns dictum, this principle may find its primary application in respect of cases under the European Convention on Human Rights. But the Convention is not an exhaustive statement of fundamental rights under our system of law. Lord Hoffmann's dictum applies to fundamental rights beyond the four corners of the Convention. In my view it is engaged in the present case. And it therefore seems to me remarkable that a modification of such a fundamental right can be achieved without the unambiguous legislative provision that would be required to alter a right arising under the Convention. To recognise that this right continues to exist at common law does not mean that every time the state wishes to withhold information from a claimant which, although vital to the defence of the claim, cannot be revealed for reasons of national security, it must submit to settlement of the claim. As the experience in Carnduff v Rock [2001] EWCA Civ 680, [2001] 1 WLR 1786 illustrates, it is perfectly proper and, more importantly, principled to find in such cases that they cannot be regarded as justiciable because no just trial is possible. Where insistence upon a fully fair hearing for a claimant will deny the defendant (or where it is not a party, the state) the protection of its vital interests that the law should recognise, then a truly fair proceeding is not possible and the trial should be halted in limine. Lord Mance has said that this is not an option that the law should readily contemplate. I agree but it seems to me to be a plainly more palatable course than to permit a proceeding in which one party knows nothing of the case made against him and which, by definition, cannot be subject to properly informed challenge. At least in the Carnduff situation both parties are excluded from the judgment seat. In the state of affairs that will result from the decision of the majority in this case, one party has exclusive access to that seat and the system of justice cannot fail to be tainted in consequence. Article 6 Article 6(1) of the European Convention on Human Rights and Fundamental Freedoms provides: In the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law. Judgment shall be pronounced publicly but the press and public may be excluded from all or part of the trial in the interest of morals, public order or national security in a democratic society, where the interests of juveniles or the protection of the private life of the parties so require, or to the extent strictly necessary in the opinion of the court in special circumstances where publicity would prejudice the interests of justice. It is well established that the overriding right guaranteed by article 6(1), the right to a fair trial, is absolute see Montgomery v HM Advocate [2003] 1 AC 641, 673, Brown v Stott [2003] 1 AC 681, 719 and Dyer v Watson [2002] UKPC D1, [2004] 1 AC 379 at para 73. But the constituent rights comprised, whether expressly or implicitly, within article 6 are not themselves absolute: Brown v Stott at 704 per Lord Steyn. One of the implicit constituent rights of article 6 is that there should be equality of arms between the parties to proceedings. Of this constituent right, Lord Bingham said in Brown v Stott at 695 that it lay at the heart of the right to a fair trial. Equality of arms is the means by which a fair adversarial contest may take place. It requires that there must be an opportunity for all parties to be aware of and to comment on all the evidence adduced or observations submitted, with a view to influencing the courts decision Vanjak v Croatia (Application No 29889/04) (unreported) 14 January 2010, at para 52. Although, as a constituent element of article 6, equality of arms is not an absolute right, restrictions may only be placed upon it where it is strictly necessary and proportionate do so. A strong countervailing public interest is required to satisfy this requirement. Moreover, the restriction must be sufficiently counterbalanced by appropriate procedures allowed by the judicial authorities. And the restrictions must not be such as effectively to extinguish the very essence of the right. These propositions derive from a series of decisions of the European Court of Human Rights (ECtHR) which constitute a clear and constant line of authority emanating from Strasbourg. One may begin with Tinnelly & Sons Ltd v United Kingdom (1998) 27 EHRR 249. At para 72 the court said: 72. The Court recalls that article 6(1) embodies the right to a court, of which the right of access, that is the right to institute proceedings before a court in civil matters, constitutes one aspect. In this respect, the contracting states enjoy a certain margin of appreciation, although the final decision as to the observance of the Convention's requirements rests with the Court. It must be satisfied that the limitations applied do not restrict or reduce the access left to the individual in such a way or to such an extent that the very essence of the right is impaired. Furthermore, a limitation will not be compatible with article 6(1) if it does not pursue a legitimate aim and if there is not a reasonable relationship of proportionality between the means employed and the aim sought to be achieved. So the very essence of the right must not be impaired and the restriction on the constituent right must be proportionate. In Rowe and Davis v United Kingdom (2000) 30 EHRR 1 at para 61 the court said: . as the applicants recognised, the entitlement to disclosure of relevant evidence is not an absolute right. In any criminal proceedings there may be competing interests, such as national security or the need to protect witnesses at risk of reprisals or keep secret police methods of investigation of crime, which must be weighed against the rights of the accused. In some cases it may be necessary to withhold certain evidence from the defence so as to preserve the fundamental rights of another individual or to safeguard an important public interest. However, only such measures restricting the rights of the defence which are strictly necessary are permissible under article 6(1). Moreover, in order to ensure that the accused receives a fair trial, any difficulties caused to the defence by a limitation on its rights must be sufficiently counterbalanced by the procedures followed by the judicial authorities. A precisely similar formula was employed by the court in para 52 of its judgment in Jasper v United Kingdom (2000) 30 EHRR 441 and in para 52 of Pocius v Lithuania (Application No 35601/04) (unreported) 6 July 2010. Significantly, it was also used by the court at para 184 of its judgment in Kennedy v United Kingdom (Application No 26839/05) (unreported) 18 May 2010 where it was confirmed that these principles apply with equal force to civil proceedings. From these statements it is clear that the balancing exercise between, on the one hand, full access to all the elements of the equality of arms principle and, on the other, the withholding of evidence on the grounds of national security, must be conducted on the basis that only such restriction on full access to relevant material as is absolutely required can be countenanced. And even if that hurdle is surmounted, it must be shown that the limitation on the rights of the party who is denied such access is adequately offset by sufficient counterbalancing measures. It seems to me that measures can only be regarded as sufficient if they either wholly eliminate the disadvantage that would otherwise have accrued or if they diminish the difficulties deriving from the non disclosure of the relevant material to a condition of insignificance. Thus as the interveners, Justice and Liberty, have put it, restrictions on untrammelled access to relevant material can only be justified in a justiciable case where sufficient information about the substantive case which a party has to meet is disclosed so that he may effectively challenge it. Otherwise, the limitation on the right to equality of arms can in no sense be regarded as having been sufficiently counterbalanced. A function of the counterbalancing measures is to ensure that the very essence of the right is not impaired. It is, I believe, important to have a clear understanding of what is meant by the essence of the right. If equality of arms lies at the heart of a fair trial, the essence of the right must surely include the requirement that sufficient information about the case which is to be made against him be given to a party so that he can give meaningful instructions to answer that case. In Secretary of State for the Home Department v MB [2007] UKHL 46, [2008] AC 440, a case involving a challenge to a non derogating control order, Lord Bingham referred to the general acceptance by the House of Lords in R (Roberts) v Parole Board [2005] UKHL 45, [2005] 2 AC 738 that there was a core, irreducible, minimum entitlement for the appellant, as a life sentence prisoner, to be able effectively to test and challenge any evidence which decisively bore on the legality of his detention. That irreducible minimum entitlement also applied in the case of a control order: see para 43 of MB. The opportunity to know and effectively test the case against him (the core irreducible minimum entitlement) surely captures the essence of the right. And it seems to me that the essence of the right cannot change according to the context in which it arises. Whether a hearing should be conducted in private or in open session; whether information about the case against an individual should be provided by way of full disclosure or by redacted statements or in the form of a summary or gist; whether witnesses should be anonymised all of these are variables to which recourse may be had in order to reflect the context in which the requirements of article 6 must be examined. But if the essence of the right is to be regarded (as I believe it must be) as the indispensable and necessary attributes of the right as opposed to those which it may or may not have, its essence cannot alter according to the circumstances in which it falls to be considered. Para 217 of the European Court of Human Rights judgment in A v United Kingdom (2009) 49 EHRR 625 has been cited by Lord Mance as an example of the emphasis given by the court to the context in which the requirements of the right were being considered. That case involved a challenge to the decision of the Home Secretary to certify that each of the applicants should be detained because he reasonably believed that their presence in the United Kingdom posed a threat to national security. As it seems to me the only relevant part of para 217 is contained in the following passage: In view of the dramatic impact of the lengthy and what appeared at that time to be indefinite deprivation of liberty on the applicants fundamental rights, article 5(4) must import substantially the same fair trial guarantees as article 6(1) in its criminal aspect This says nothing about the essence of the right to equality of arms. It merely (but unsurprisingly) confirms that if ones liberty is to be deprived on foot of the order of the Secretary of State, the same guarantees as are available to defendants in a criminal trial should be extended to those who were the subject of detention orders. Lord Mance also expressed agreement with the decision of the Court of Appeal in R(AHK) v Secretary of State for the Home Department (Practice Note) [2009] EWCA Civ 287; [2009] 1 WLR 2049 where, according to Lord Mances analysis, it was held that a claim for judicial review of the refusal of an application for British citizenship could be distinguished from the requirements prescribed by A v United Kingdom on the ground that the latter cases focus was on detention. I do not agree that the AHK case distinguished A v United Kingdom or, at least, that it suggested (contra the decision in A v UK), that abrogation of the right of a claimant to know the essential elements of the case to be made against him was permissible. The AHK case was principally concerned with the question whether a special advocate should be appointed. In the list of principles to be applied in cases where the Secretary of State has decided that the reasons for refusing British citizenship could not be fully disclosed Sir Anthony Clarke MR at para 37 (iv) (d) said: All depends upon the circumstances of the particular case, but it is important to have in mind the importance of the decision from the claimant's point of view, the difficulties facing the claimant in effectively challenging the case against him in open court and whether the assistance of a special advocate will or might assist the claimant in meeting the Secretary of State's case and the court in arriving at a fair conclusion. Underlying this statement is the acknowledgment that the claimant must be assisted in meeting the Secretary of States case. There is no reason to suppose that the Court of Appeal would have endorsed a procedure where the claimant was effectively prevented from knowing and meeting the essential case made against him. At a theoretical level it is possible that advocates retained to consider material that cannot be disclosed to a claimant can supply the vital ingredient of ensuring that the case made against the claimant is effectively met. In such circumstances the essence of the article 6 right is not lost. But AHK is not authority for the proposition that where that indispensable requirement cannot be fulfilled and the claimant is prevented from presenting a fully informed opposition to the case made against him, no violation of article 6 arises because the consequences for the claimant are less serious than the deprivation of his liberty. It is, I believe, crucial to a proper understanding of ECtHR jurisprudence in this area that the essence of the right under article 6 is that a party is entitled to know and effectively challenge the case made against him. Equality of arms, or a properly set adversarial contest, requires that both parties have equal, or at least a sufficient, access to the material that will be deployed against them. The adversarial contest sets the context and the adversarial contest arises in relation to article 6 rights as opposed to other Convention rights. Thus cases such as Leander v Sweden (1987) 9 EHRR 433 (which was concerned with alleged violations of articles 8, 10 and 13) and Esbester v United Kingdom (1998) 18 EHRR CD72 (which dealt with claims under article 8 and 13) are of little assistance in determining the requirements of the equality of arms principle under article 6. Equality of arms did not arise in these cases. No adversarial contest was engaged. Whether it is legitimate to withhold information in an article 8 or an article 10 context has nothing to do with the propriety of its non disclosure where parties are seeking a resolution of competing cases from a properly informed and impartial tribunal. Articles 8 and 10 are qualified rights. Interference with those rights may be justified on grounds specified in the articles. By contrast, article 6 is not subject to exemption from the effect of interference. Kennedy v United Kingdom involved complaints made by the applicant to the Investigatory Powers Tribunal (IPT) that his communications were being intercepted. The applicant had sought specific directions regarding the conduct of the proceedings in order to ensure the protection of his Convention rights under article 6 (1). In particular, he asked that his arguments and evidence be presented at an oral hearing; that all hearings be conducted in public; that there be mutual disclosure and inspection between the parties of all witness statements and evidence upon which parties sought to rely and exchange of skeleton arguments in relation to planned legal submissions; that evidence of each party be heard in the presence of the other party or their legal representatives, with oral evidence being open to cross examination by the other party; that any opinion received from a commissioner be disclosed to the parties; and that, following its final determination, the IPT state its findings and give reasons for its conclusions on each relevant issue. IPT had held that the applicants proceedings before that tribunal engaged article 6. That finding was somewhat diffidently contested before ECtHR, the government contending that there was no civil right involved. It was not contended, as it might well have been, that article 6, according to the courts constant jurisprudence, did not apply to cases of surveillance. ECtHR proceeded on the assumption that article 6 did apply. It is significant that the courts judgment is largely preoccupied with a consideration of the various specific claims made by the applicant about how the proceedings should be conducted. The question of providing him with sufficient information in the form of a gist or summary to meet the case against him did not feature in the list of those claims. The question of supplying redacted documents is discussed, however, and the courts decision seems largely to have been influenced by the argument advanced on behalf of the government that it was simply not possible to produce the information that the applicant sought because national security would inevitably be compromised. That stance is entirely consistent with the view that surveillance cases do not engage article 6. It is surprising that more was not made of this by the government and that the court did not address the issue directly. If it had done and if it had followed its own constant jurisprudence, the anomaly, which I believe the decision in Kennedy represents, would have been avoided. In Klass v Federal Republic of Germany (1978) 2 EHRR 214 at para 75 ECtHR said this about secret surveillance: As long as it remains validly secret, the decision placing someone under surveillance is thereby incapable of judicial control on the initiative of the person concerned, within the meaning of article 6; as a consequence, it of necessity escapes the requirements of that article. The logic of this position is inescapable. The entire point of surveillance is that the person who is subject to it should not be aware of that fact. It is therefore impossible to apply article 6 to any challenge to the decision to place someone under surveillance, at least until notice of termination of the surveillance has been given. This approach has been consistently applied by the court. So for instance in Rotaru v Romania (2000) 8 BHRC 449 at para 69 the court said where secret surveillance is concerned, objective supervisory machinery may be sufficient as long as the measures remain secret. It is only once the measures have been divulged that legal remedies must become available to the individual. It is precisely because the fact of surveillance must remain secret in order to be efficacious that article 6 cannot be engaged. It appears to me, therefore, that the decision in Kennedy ought to have been made on the basis that article 6 was not engaged because the issues that the case raised were simply not justiciable. That the decision is out of line with the established jurisprudence of the court is perhaps best exemplified by contrasting it with the approach of the Grand Chamber in A v United Kingdom as applied by the House of Lords in Secretary of State for the Home Department v AF (No 3) [2010] 2 AC 269. At para 59 Lord Phillips said this about the ratio in A v United Kingdom: I am satisfied that the essence of the Grand Chamber's decision lies in para 220 and, in particular, in the last sentence of that paragraph. This establishes that the controlee must be given sufficient information about the allegations against him to enable him to give effective instructions in relation to those allegations. Provided that this requirement is satisfied there can be a fair trial notwithstanding that the controlee is not provided with the detail or the sources of the evidence forming the basis of the allegations. Where, however, the open material consists purely of general assertions and the case against the controlee is based solely or to a decisive degree on closed materials the requirements of a fair trial will not be satisfied, however cogent the case based on the closed materials may be. Whilst Lord Phillips at para 65 implied that the Grand Chambers decision (that non disclosure cannot deny a party knowledge of the essence of the case against him) might apply only where the consequences for an individual were as severe as those normally imposed under a control order, there are indications in his and other speeches that the principle is of general application. In particular, Lord Phillips rejected the suggestion that there should be a different standard where the control order did not amount to detention para 63 and at para 64 he said this: The best way of producing a fair trial is to ensure that a party to it has the fullest information of both the allegations that are made against him and the evidence relied upon in support of those allegations. Where the evidence is documentary, he should have access to the documents. Where the evidence consists of oral testimony, then he should be entitled to cross examine the witnesses who give that testimony, whose identities should be disclosed. Both our criminal and our civil procedures set out to achieve these aims. In some circumstances, however, they run into conflict with other aspects of the public interest, and this is particularly the case where national security is involved. How that conflict is to be resolved is a matter for Parliament and for government, subject to the law laid down by Parliament. That law now includes the Convention, as applied by the HRA. That Act requires the courts to act compatibly with Convention rights, in so far as Parliament permits, and to take into account the Strasbourg jurisprudence. That is why the clear terms of the judgment in A v United Kingdom resolve the issue raised in these appeals. The views of Lord Hope were equally clear and comprehensive. At para 83 he said: The approach which the Grand Chamber has adopted is not, as it seems to me, at all surprising. The principle that the accused has a right to know what is being alleged against him has a long pedigree. As Lord Scott of Foscote observed in A v Secretary of State for the Home Department [2005] 2 AC 68, para 155, a denunciation on grounds that are not disclosed is the stuff of nightmares. The rule of law in a democratic society does not tolerate such behaviour. The fundamental principle is that everyone is entitled to the disclosure of sufficient material to enable him to answer effectively the case that is made against him. Lady Hale in para 103 said that Strasbourg had now made it entirely clear what the test of a fair hearing is. The test was whether the controlled person had had the possibility to challenge effectively the allegations made against him. He had to have sufficient information about those allegations to be able to give effective instructions to his special advocate. If the majority in this appeal are right, however, the test of a fair hearing in Mr Tariqs case is different. He need not be given sufficient information about the allegations against him to challenge them effectively or to give effective instructions to his special advocate. For my part I cannot understand why this should be so. The result of the decision of the majority is to create a different class of case from that where what Lord Brown has helpfully described as A type disclosure must be given. The eligibility criteria for inclusion in this privileged group are not clear. Certainly, the class is not confined to those whose liberty is at stake, as the speeches in AF (No 3) make clear. And, presumably, it must also include freezing order cases Kadi v Council of the European Union Joined Cases C 402/05 P and C 415/05 P [2009] AC 1225, as applied by the European General Court in Kadi II Case T 85/09 [2011] 1 CMLR 697. If A type disclosure is required in challenges to freezing orders, does it extend to property rights more generally? If it does, why should property rights be distinguished from loss of employment cases? After all, loss of livelihood may be just as devastating as having ones assets frozen. It seems to me that there is no principled basis on which to draw a distinction between the essence of the right to a fair trial based on the nature of the claim that is made. A fair trial in any context demands that certain indispensable features are present to enable a true adversarial contest to take place. That conclusion is reflected in the later decision of ECtHR of Uukauskas v Lithuania (Application No 16965/04) (unreported) 6 July 2010. Lord Mance has sought to distinguish this case on the basis that the procedure adopted was contrary to national law. But that consideration was in no sense central to the courts reasoning. On the contrary, the observation (at para 48) that Lithuanian law and judicial practice provide that such information may not be used as evidence in court against a person unless it has been declassified, and that it may not be the only evidence on which a court bases its decision was made in order to draw a contrast with the view that documents which constitute state secrets may only be disclosed to persons who possess the appropriate authorisation. It is quite clear that the violation of article 6 which the court held to have occurred was based on conventional ECtHR principles. This much is evident from para 51 where the court said; In conclusion, therefore, the Court finds that the decision making procedure did not comply with the requirements of adversarial proceedings or equality of arms, and did not incorporate adequate safeguards to protect the interests of the applicant. It follows that there has been a violation of article 6(1) in the present case. The unavoidable result from this case is that Strasbourg has again made it entirely clear what the test for a fair hearing is where someone seeks to challenge a decision that he should be removed from a firearms register. He is entitled to know the reasons that this has happened in order to be able to effectively challenge them. If that is so, why should someone who has been dismissed from his employment be in a less advantageous position? Conclusions I have concluded that the Court of Appeal was correct in finding that where article 6 is engaged, it is necessary for a party to proceedings to be provided with sufficient information about the allegations against him to allow him to give effective instructions to his legal representatives and, if one has been appointed, the special advocate so that those allegations can be effectively challenged. I would therefore dismiss the appeal by the Home Office. For the reasons given by Lord Mance, with which I agree, I would hold that the closed material procedure provided for in the Employment Tribunal legislative scheme is not in principle incompatible with article 6 and EU law. I would therefore also dismiss the cross appeal. LORD DYSON I agree that for the reasons given by Lord Mance the Court of Appeal was correct to hold that the closed material procedure provided for in the Employment Tribunal legislative scheme, including its provision for the appointment of special advocates is in principle compatible with article 6 of the European Convention on Human Rights (ECHR) and EU law. I also agree that the Court of Appeal was wrong to find that, in all cases in which article 6 (civil) is engaged, it is necessary for an individual to be provided with sufficient information about the allegations against him (the gist) to enable him to give effective instructions to his legal representatives and the special advocate (where one has been appointed) in relation to those allegations. It is on this second question that I wish to add some words of my own. General observations about closed procedures The article 6 right to a fair trial is absolute: see, for example, per Lord Hope in Dyer v Watson [2002] UKPC D1 [2004] 1 AC 379 at para 73. In principle, a fair trial presupposes adversarial proceedings and equality of arms. Thus, for example, in Vanjak v Croatia (Application No 29889/04) (unreported) 14 January 2010, at para 52, the European Court of Human Rights said: . . independently of whether the case is a civil, criminal or disciplinary one, the right to adversarial proceedings has to be complied with. That right means in principle the opportunity for the parties to court proceedings falling within the scope of article 6 to have knowledge of and comment on all evidence adduced or observations submitted, with a view to influencing the courts decision. But the constituent elements of a fair process are not absolute or fixed: see Brown v Stott [2003] 1 AC 681 at 693D E per Lord Bingham; 719G H per Lord Hope; and 727H per Lord Clyde. This was re affirmed by the ECtHR in relation to article 5(4) in A v United Kingdom (2009) 49 EHRR 625 at para 203: The requirement of procedural fairness under article 5(4) does not impose a uniform, unvarying standard to be applied irrespective of the context, facts and circumstances. Moreover, it has been recognised by the ECtHR that there are circumstances where a limitation on what would otherwise be a general rule of fairness is permissible. Thus in Rowe and Davis v United Kingdom (2000) 30 EHRR 1, at para 61, the European Court of Human Rights said: the entitlement to disclosure of relevant evidence is not an absolute right. In any criminal proceedings there may be competing interests, such as national security or the need to protect witnesses at risk of reprisals or keep secret police methods of investigation of crime, which must be weighed against the rights of the accused. In some cases it may be necessary to withhold certain evidence from the defence so as to preserve the fundamental rights of another individual or to safeguard an important public interest. However, only such measures restricting the rights of the defence which are strictly necessary are permissible under article 6(1). Moreover, in order to ensure that the accused receives a fair trial, any difficulties caused to the defence by a limitation on its rights may be sufficiently counterbalanced by the procedures followed by the judicial authorities. Prima facie, a closed material procedure denies the party who is refused access to the closed material the right to full and informed participation in adversarial proceedings and to that extent is inconsistent with the principle of equality of arms. There are two factors which the Secretary of State says are sufficient to counterbalance the effects of the closed material procedure in the present case. The first is that there is scrutiny by an independent court (the Employment Tribunal) fully appraised of all relevant material and experienced in dealing with discrimination cases. The second is the testing by a special advocate of the Home Offices case in closed session. But are these factors sufficient in circumstances where the gist of the Home Office case is not disclosed to the claimant? How can the special advocate represent the claimants interests if the claimant is unable to give full instructions to him? The answer to these questions in the context of proceedings involving the liberty of the subject is clear. If the special advocate is unable to perform his function in any useful way unless the detainee is provided with sufficient information about the allegations to enable him to give effective instructions to the special advocate, then there must be disclosure to the detainee of the gist of that information: see A v United Kingdom at para 220 and, in the context of control orders, Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28, [2010] 2 AC 269. In such a case, there must be disclosure, regardless of how important the competing national interest may be in favour of withholding the information. The consequence of this will inevitably be that in some cases the prosecuting or detaining authorities will be faced with the invidious choice of disclosing sensitive information or risking losing the case. But what is the position in cases which do not involve the liberty of the subject? For the reasons given by Lord Mance and Lord Brown, I agree that neither A v United Kingdom nor AF (No3) decides this question. Mr Allen QC and Mr Howell QC submit that the reasoning in A v United Kingdom is not limited to cases involving the liberty of the subject and should be applied to civil claims too. They submit that, properly understood, the Strasbourg jurisprudence does not support the proposition that a different approach may be adopted to the problem in civil claims. They also say that to distinguish between the requirements of article 6 on the basis of a classification of the type of case involved is unprincipled and will give rise to uncertainty and confusion. But it is clear from para 203 of A v United Kingdom itself that article 6 does not require a uniform approach to be adopted in all classes of case. In Kennedy v United Kingdom (Application No 26839) (unreported) 18 May 2010, the European Court of Human Rights said that the entitlement to disclosure of relevant evidence is not an absolute right (para 187); the character of the proceedings may justify dispensing with an oral hearing (para 188); and the extent to which the duty to give reasons applies may vary according to the nature of the decision and must be determined in the light of the circumstances of the case (para 189). I therefore agree with what Sir Anthony Clarke MR said when giving the judgment of the court in R(AHK) v Secretary of State for the Home Department (Practice Note) [2009] EWCA Civ 287, [2009] 1 WLR 2049 at para 45: The above analysis shows that the European Court of Human Rights considers each class of case separately. The issues in this class of case are a far cry from the issues that arise in the criminal cases discussed by the court in A v United Kingdom 19 February 2009. Moreover, without in any way minimising the effect of being refused British citizenship, the consequences of a deprivation of (or even interference with) liberty are plainly very much more serious. In these circumstances we do not think that the approach of the court in criminal cases or in cases of deprivation or interference with liberty can or should be applied directly to this class of case. That is not to say that, as explained earlier, each individual is not entitled to a fair hearing of his application for judicial review. Nevertheless, I would accept that the general rule is that an applicant should enjoy the full panoply of article 6 rights, including full disclosure of all relevant material and that any limitation on the ordinary incidents of article 6 requires careful justification. In deciding how to strike the balance between the rights of the individual and other competing interests, the court must consider whether scrutiny by an independent court and the use of special advocates are sufficient to counterbalance the limitations on the individuals article 6 rights. In many cases, an individuals case can be effectively prosecuted without his knowing the sensitive information which public interest considerations make it impossible to disclose to him. For example, in a discrimination claim such as that of Mr Tariq, the central issue may well not be whether the underlying security concerns are well founded, but rather whether the decision making process was infected by discrimination. As Mr Eadie QC points out, Mr Tariqs appeal is not against the assessments or conclusions of the Home Office as to the withdrawal of his security clearance. SVAP provides the expert forum for considering such issues. It was not for the Employment Tribunal to determine whether, for example, it believed or did not believe Mr Tariqs assertions about the nature of his relationships with persons involved in or associated with terrorist activities. Thus in the conduct of a discrimination claim, the special advocate and indeed the judge can to a considerable extent test the case of the alleged discriminator without the input of the claimant. The surveillance/security vetting cases Lord Mance has referred at para 68 to what he describes as the clear line of jurisprudence culminating in the Courts decision in Kennedy which demonstrates that, in civil cases, it is not necessary to provide the gist of information which the interests of national security require to be kept secret. I think that it is necessary to examine the authorities with some care to see precisely what these cases do establish. In the absence of special circumstances, our courts should follow any clear and constant jurisprudence of the European Court of Human Rights: see R (Alconbury Developments Ltd) v Secretary of State for the Environment, Transport and the Regions [2001] UKHL 23, [2003] 2 AC 295 at para 26. The first case to note is Klass v Federal Republic of Germany (1978) 2 EHRR 214. This involved a challenge to legislation which permitted the authorities to open and inspect mail and listen to telephone conversations in order to protect, inter alia, against imminent dangers threatening the existence or the security of the state. The challenge was based on an alleged breach of articles 6, 8 and 13 of the European Convention on Human Rights. At para 75, the European Court of Human Rights said : As long as it remains validly secret, the decision placing someone under surveillance is thereby incapable of judicial control on the initiative of the person concerned, within the meaning of article 6; as a consequence, it of necessity escapes the requirements of that article. The cases of Leander v Sweden (1987) 9 EHRR 433 and Esbester v United Kingdom (1993) 18 EHRR CD72 are discussed by Lord Mance at paras 28 to 32 above. They can be considered together, although at first sight it may seem odd to refer to them at all since they are not article 6 cases. The claim in Leander was brought under articles 8, 10 and 13 and in Esbester under articles 8 and 13. I accept that what may be a proportionate and justified interference with a persons rights under article 8 may not correspond precisely with what may be a strictly necessary and sufficiently counterbalanced invasion of his right to a fair trial under article 6. Moreover, it is right to point out that Leander and Esbester were referred to by the European Court of Human Rights in Kennedy, but only in its discussion of the claims under articles 8 and 13: see paras 122, 152, 195 and 197. The section in Kennedy which deals with article 6 does not refer to either of these authorities. Mr Eadie accepts that Leander and Esbester did not concern article 6. He relies on them as being directly analogous to the present case, relating to security vetting in an employment context. Issues of fairness were central to the issues arising under articles 8 and 10 and the right to an effective remedy under article 13. The European Court of Human Rights found that the vetting systems in those cases were compatible with article 8 and upheld the right of the state not to disclose the reasons for the rejection of the applicants application for employment as a result of a security vetting process. Whereas Klass is a case where it seems to have been held that article 6 did not apply at all and Leander and Esbester are not article 6 cases, there can be no doubt that Kennedy is an article 6 case. In Kennedy (which was decided after the decision of the Court of Appeal in the present case), the applicant complained about an alleged interception of his communications, claiming that it was a violation of his article 8 rights. He also complained that the hearing before the Investigatory Powers Tribunal (IPT) was not attended by adequate safeguards as required under article 6 and that, as a result, he had been denied an effective remedy under article 13. Lord Mance has set out the relevant passages of the judgment at paras 34 and 35 above. The submissions of the parties summarised at paras 180 to 183 of the judgment were directed to the question of what article 6 required. It is of note that the Government submitted that the scope of the article 6 guarantees in that case should be in harmony with the Courts approach to judicial control under article 8. The courts assessment at paras 184 to 191 was explicitly on the basis of the application of article 6. In contrast with para 75 of Klass, the court did not say that the case escapes the requirements of [article 6]. Thus at para 186, the court emphasised that the proceedings related to secret surveillance measures and that there was therefore a need to keep secret sensitive and confidential information. The court continued: this consideration justifies restrictions in the IPT proceedings. The question is whether the restrictions, taken as a whole, were disproportionate or impaired the very essence of the applicants right to a fair trial. This is the classic approach to article 6. The courts conclusion at para 190 was that the restrictions on the procedure before the IPT did not violate the applicants right to a fair trial. In reaching this conclusion, the court took into account the breadth of access to the IPT (an independent court) enjoyed by those complaining about interception and the absence of any evidential burden to be overcome in order to lodge an application with the IPT. It concluded: In order to ensure the efficacy of the secret surveillance regime, and bearing in mind the importance of such measures to the fight against terrorism and serious crime, the Court considers that the restrictions on the applicants rights in the context of the proceedings before the IPT were both necessary and proportionate and did not impair the very essence of the applicants article 6 rights. Mr Allen and Mr Howell submit that Kennedy should be understood as a decision that, so long as the very subject matter of the dispute must justifiably remain secret, is effectively non justiciable and the substantive protections that article 6 contains cannot be applied in substance to its resolution. In other words, they submit that the decision in Kennedy should be analysed as an application of para 75 of Klass. If, however, the court had intended to adopt this approach, it would have said so. Instead, it clearly purported to apply article 6. Kennedy is a striking decision. But for the security issues raised in the case, it is surely inconceivable that the court would have concluded that the restrictions on the applicants rights before the IPT (a completely closed procedure without even the protection of a special advocate) were necessary and proportionate and did not impair the very essence of the applicants article 6 rights. The crucial reason for this conclusion was that the restrictions on the applicants rights were necessary in order to ensure the efficacy of the secret surveillance regime. Kennedy was a case about a secret surveillance regime by interception of his communications. This same language was used by the court in Klass at para 58 to justify the interference with the applicants article 8 rights in that case (another interception of communications case): the fact of not informing the individual once surveillance has ceased cannot itself be incompatible with this provision, since it is this very fact which ensures the efficacy of the interference. The same reasoning appears in the security vetting cases of Leander and Esbester. Thus, for example, at para 66 of Leander, the court said that the very fact that the information released to the military authorities was not communicated to Mr Leander cannot by itself warrant the conclusion that the interference was not necessary in a democratic society in the interests of national security, as it is the very absence of such communication which, at least partly, ensures the efficacy of the personnel control procedure. In support of this proposition, the court referred to para 58 of Klass. There is similar reasoning in the Commissions decision in Esbester. In my view, the significance of Kennedy is that it is a decision explicitly based on an application of article 6 which adopted the same approach as that which was taken by the court in applying articles 8 and 13 in Leander and by the Commission in Esbester. This provides clear support for the submission of Mr Eadie that, for the purposes of the issues that arise in the present case, there is no material difference between articles 8 and 13 on the one hand and article 6 on the other. I do not consider that, if the complaints in Leander and Esbester had been based on article 6, the outcome in these cases would have been different. The other point to emphasise is that these cases show that there is no material difference between surveillance cases (such as Klass and Kennedy) and security vetting cases (such as Leander and Esbester). In the former, restrictions on an individuals right to disclosure and participation in a hearing will be considered necessary and proportionate if they are required in order to ensure the efficacy of the secret surveillance regime. In the latter, the restrictions will be considered necessary and proportionate if they are required in order to ensure the efficacy of the personnel control procedure. Mr Allen and Mr Howell submit that the limited significance of Leander, Esbester and Kennedy is demonstrated by the decision of the ECtHR in Uukauskas v Lithuania (Application No 16965/04) (unreported) 6 July 2010. Lord Mance has set out the facts at para 37 above. I find this a difficult decision to interpret. On the one hand, the court approached the matter in conventional article 6 terms: see para 46 where it noted that (i) the entitlement to disclosure of relevant evidence is not an absolute right; (ii) it may be necessary to withhold certain evidence to safeguard an important public interest; but (iii) only such measures restricting the rights of the defence which are strictly necessary are permissible and there must be sufficient counterbalancing. At para 48 the court referred to the fact that, according to Lithuanian law and judicial practice, secret information may not be used as evidence in court unless it has been declassified and it may not be the only evidence on which a court bases its decision. It is not clear to me to what extent the court based its conclusion that there had been a breach of article 6 on the fact that use of the secret material against the applicant (which was of decisive importance to his case) was contrary to Lithuanian law. But I accept that on the face of it, this is an article 6 decision which does not sit easily with the surveillance/vetting procedure cases to which I have referred. There is no reference to them. There is no weighing of the national interest in the protection of the community against crime against the general right to adversarial proceedings. For these reasons and because it is unclear to what extent the position under Lithuanian law influenced the decision, I agree with Lord Mance that this decision does not cast doubt on the approach adopted in the surveillance/security vetting cases. Unlike Lord Mance, however, I doubt whether the fact that there is no procedure under Lithuanian law for the use of a special advocate to consider closed material is of significance, since, as was pointed out by the European Court of Human Rights in Kennedy at para 187, the procedure before the IPT did not permit the use of special advocates either. In my judgment, these decisions show that there is a clear line of authority to support the proposition that, in surveillance and security vetting cases, an individual is not entitled to full article 6 rights if to accord him such rights would jeopardise the efficacy of the surveillance or security vetting regime itself. On the material shown to us, the line of authority may not be very long, but in my view it is sufficiently clear that it should be followed by our courts. The cases show, in particular, that there is no right to be given the gist of relevant information if and to the extent that this would jeopardise the efficacy of the surveillance or security vetting regime. The present case I have no doubt that article 6 does not require that Mr Tariq should be given the gist of information which would damage or jeopardise national security. First, and above all, this is a security vetting case and in such a case article 6 does not require gisting if and in so far as it would jeopardise the efficacy of the personnel control procedure. That is a sufficient reason for allowing the Home Office appeal. There is no sensible basis for distinguishing the present case from Leander and Esbester. In those cases (which concerned a complaint about the manner in which security vetting was conducted where the applicant was applying for a sensitive post), article 8 did not require disclosure of the security material. In the present case, the complaint is about the decision not to allow a person to remain in a post where security vetting was employed. There can be no distinction in principle between the two cases. A related point is that in all cases where security clearance is sought, it is because the individual has volunteered to undergo the clearance process for the purpose of doing (or continuing to do) the job that he is employed to do. He must be taken to know that checks will be made that may produce material that cannot be shown to him. As Lord Hope points out, he is a volunteer. I would add the following points which reinforce the Home Office case. First, the subject matter of the claim is a claim for damages for alleged discrimination. I do not wish to underestimate the importance of the right not to be subjected to discrimination. But on any view, discrimination is a less grave invasion of a persons rights than the deprivation of the right to liberty. Secondly, the issues in the present case are such that the presence of an independent court and a special advocate are likely to go a long way to making up for the fact that Mr Tariq will be unable fully to participate in the proceedings. As I have explained at para 147 above, there is likely to be only limited (if any) scope for Mr Tariq to be able to give instructions to the special advocate which are necessary to enable her to test the Home Office case effectively. Conclusion I would, therefore, allow the Home Offices appeal primarily on the ground that this case concerns a decision taken in the context of security vetting. In other classes of civil case which are outside the surveillance/security vetting context, the balance between the individuals article 6 rights and other competing interests may be struck differently. It is said that this gives rise to undesirable uncertainty. But much of the content of the European Convention on Human Rights is about striking balances. This is sometimes very difficult and different opinions can reasonably be held. As a consequence, outcomes are sometimes difficult to predict. This is inevitable. But it is not a reason for striving to devise hard and fast rules and rigid classifications. It is, however, at least possible to say that, in principle, article 6 requires as much disclosure as possible. It is very easy for the state to play the security card. The court should always be astute to examine critically any claim to withhold information on public interest grounds. For the reasons that I have given, I would allow the Home Office appeal. I would also dismiss the appeal of Mr Tariq for the reasons given by Lord Mance. LORD PHILLIPS, LADY HALE AND LORD CLARKE I agree that, for the reasons given by Lord Hope, Lord Brown, Lord Mance and Lord Dyson, the appeal of the Home Office should be allowed and that the cross appeal of Mr Tariq should be dismissed. LORD RODGER Lord Rodger, who died before judgment was given in this case, had indicated that he agreed with the judgments of Lord Mance and Lord Brown.

This appeal concerns the permissibility of a procedure whereby a claimant in employment tribunal proceedings may be excluded along with his representatives from certain aspects of those proceedings on grounds of national security. In particular the question arises as to whether such a procedure, known as a closed material procedure, is compatible with European Union law and the European Convention on Human Rights. Mr Tariq was employed as an immigration officer with the Home Office until 2006 when he was suspended and his security clearance withdrawn. The background for these decisions was the arrest of Mr Tariqs brother and cousin during an investigation into a suspected plot to mount a terrorist attack on transatlantic flights. Mr Tariqs cousin was convicted in 2008 of various offences in relation to that plot. No information suggested that Mr Tariq had himself been involved in any terrorism plot. Mr Tariq commenced proceedings in the Employment Tribunal claiming direct and indirect discrimination on grounds of race and religion. He alleged that the Home Office had relied on stereotypical assumptions about him, Muslims and individuals of Pakistani origin such as susceptibility to undue influence and that the Home Office had indirectly discriminatory policies and procedures. The Home Office denied this and stated that its decisions were based on Mr Tariqs association with individuals suspected of involvement in terrorist activities and the risk of their attempting to exert influence on him to abuse his position. Section 10(6) of the Employment Tribunals Act 1996 provides that the Secretary of State may make regulations that enable a tribunal to adopt a closed material procedure if it considers this expedient in the interests of national security. Rule 54(2) of Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (the Regulations) provides for the adoption of a closed material procedure if the tribunal so orders. Schedule 2 provides for the use of special advocates, whose role is to represent a claimants interests so far as possible in relation to the aspects closed to him and his representatives. The Employment Tribunal made an order for a closed material procedure, directing that Mr Tariq and his representatives should be excluded from the proceedings when closed evidence or documents were being considered. Mr Tariq appealed the order to the Employment Appeal Tribunal. The appeal was dismissed and a further appeal was dismissed by the Court of Appeal. The Court of Appeal, however, declared that Article 6 of the European Convention on Human Rights required Mr Tariq to be provided with the allegations being made against him in sufficient detail to enable him to give instructions to his legal team so that those allegations can be challenged effectively. This requirement is known as gisting. The Home Office appealed to the Supreme Court against the declaration and Mr Tariq cross appealed against the conclusion that a closed material procedure was permissible. The Supreme Court by a majority of 8 1 allows the Home Offices appeal and sets aside the declaration made by the Court of Appeal requiring the provision of a gist. Lord Kerr dissents. The Supreme Court unanimously dismisses Mr Tariqs cross appeal, holding that a closed material procedure is compatible with Article 6 of the European Convention on Human Rights and EU Law. Mr Tariqs Cross Appeal The issue in the cross appeal was whether the provisions in the Regulations providing for a closed material procedure were contrary to EU law or the European Convention on Human Rights. It is a basic principle of EU law that national law should provide effective legal protection of EU law rights. Those rights include the right not to be discriminated against on grounds of race or religion. As to whether the closed material procedure provided effective legal protection, the case law of the European Court of Justice is clear that EU law will look for guidance on the subject in the case law of the European Court of Human Rights. That Court has established in a line of cases culminating in Kennedy v UK that the demands of national security may necessitate a system for determining complaints under which a claimant is, for reasons of national security, unable to know the secret material by reference to which his complaint is determined. The tests are whether the system is necessary and whether it contains sufficient safeguards. On the facts, both were satisfied. The system was necessary because security vetting is a highly sensitive area in which integrity of sources of information and the means of obtaining it must be protected. The alternatives of the Home Office routinely having to pay unmeritorious claims or the courts refusing to hear claims at all are not possibilities that the law should readily contemplate. The rule of law must, so far as possible, stand for the objective resolution of civil disputes on their merits by a court which has before it material enabling it to do so. The system contained sufficient safeguards in the form of special advocates, who can usefully protect the claimants interests. For these reasons the use of the closed material procedure in this case was lawful and the cross appeal must be dismissed. The Home Offices Appeal The question in the appeal was whether there is an absolute requirement that a claimant should be able to see the allegations against him in sufficient detail to give instructions to his legal team to enable the allegations to be challenged effectively. Mr Tariq argued that the European Convention on Human Rights contained such a principle. The Supreme Court, however, held that the line of cases culminating in Kennedy v UK recognised that there was no absolute requirement. Article 6 of the European Convention on Human Rights provides the right to a fair trial. The European Court of Human Rights has held that where the liberty of the subject is involved, Article 6 requires the provision of a gist as described by the Court of Appeal. In cases such as the present not involving the liberty of the subject, however, the question is whether the use of the closed material procedure will impair the very essence of the right to a fair trial. That cannot be said to be so in this case, as Mr Tariqs claim will be determined by an independent and impartial tribunal and the disadvantages that the procedure gives rise to will as far as possible be minimised. The appeal was therefore allowed. Lord Kerr dissented. He held, first, that the withholding of information from a claimant which is then deployed to defeat his claim is a breach of his fundamental common law right to a fair trial. The removal of that right can only be achieved by legislation framed in unambiguous language. Secondly, such withholding also constitutes a breach of a claimants Article 6 right to a fair trial. Kennedy v UK was an anomaly. Lord Kerr would therefore have dismissed the appeal.

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This appeal concerns whether certain rules of the payment card schemes operated by Visa and Mastercard have the effect of restricting competition, in breach of article 101(1) of the Treaty on the Functioning of the European Union (TFEU), and equivalent national legislation. The rules in question provide for fees which are known as multilateral interchange fees or MIFs. Visa and Mastercard deny that there has been any restriction of competition, and contend that, in any event, the rules in question are exempt from the prohibition in article 101(1) because they satisfy the requirements of article 101(3) TFEU. The outline facts These are helpfully set out in the parties statement of facts and issues, as summarised below. The appellants, Visa and Mastercard, operate payment card schemes. They facilitate electronic funds transfers throughout the world, most commonly through branded credit and debit cards. The respondents, Asda Stores Ltd (Asda), Argos Ltd and others (Argos) and WM Morrison Supermarkets plc (Morrisons) (together AAM) and Sainsburys Supermarkets Ltd (Sainsburys), are retailers. The respondents accept payments from customers by way of debit and credit cards, including Visa and Mastercard branded cards. Visa and Mastercard each operate open four party payment card schemes (the Visa scheme and the Mastercard scheme), under which: Issuers (who are generally banks and other financial institutions) issue (i) debit and/or credit cards to their cardholder customers; and (ii) Acquirers (also generally banks or other financial institutions) provide payment services to merchants. These are the four parties to which the term open four party payment card scheme refers. In addition, the scheme operator (Visa or Mastercard in these cases) sets the rules of the scheme and allows institutions to join the scheme as issuers and/or acquirers. Visa and Mastercard do not themselves issue cards or sign up merchants to accept payment transactions. Instead, they accept as licensees all eligible financial institutions, these licensees being licensed to act, in specified territories, as issuers or acquirers or both. The operation of the Visa and Mastercard schemes can be represented by the following diagram: Issuers and acquirers join the Visa and/or Mastercard schemes, and In summary, the Visa and Mastercard schemes operate as follows: (i) agree to abide by the rules of the schemes. (ii) A cardholder contracts with an issuer, which agrees to provide the cardholder with a Visa or Mastercard debit or credit card, and agrees the terms on which they may use the card to buy goods or services from merchants. (iii) Those terms may include a fee payable by the cardholder to the issuer for the use of the card, the interest rate applicable to the provision of credit, and incentives or rewards payable by the issuer to the cardholder for holding or using the card (such as airmiles, cashback on transactions, or travel insurance). (iv) Merchants who wish to accept payment cards under the scheme contract with an acquirer, which agrees to provide services to the merchant enabling the acceptance of the cards, in consideration of a fee, known as the merchant service charge (the MSC). The acquirer receives payment from the issuer to settle a transaction entered into between cardholder and merchant, and passes the payment on to the merchant, less the MSC. (v) The MSC is negotiated between the acquirer and the merchant. Typically, it is set at a level that reflects the size and bargaining power of the merchant, the level of the acquirers costs (including scheme fees payable to Visa and Mastercard, and any interchange fees payable by the acquirer to issuers), and the acquirers margin. (vi) The scheme rules require that, whenever a cardholder uses a payment card to make a purchase from a merchant, the cardholders issuer must make a payment to the merchants acquirer to settle the transaction. (vii) The Visa and Mastercard scheme rules make provision for the terms on which issuers and acquirers (who are members of the scheme) are to deal with each other, in the absence of any different bilateral agreement made between them. These terms include issuers and acquirers settling transactions at the face value of the transaction (settlement at par or, as it is sometimes referred to, prohibition on ex post pricing) and also provide for the payment of an interchange fee on each transaction. (viii) Under both the Visa and Mastercard schemes, the default interchange fee (ie the MIF) which is payable by the acquirer to the issuer on each transaction is expressed either as a percentage of the value of the transaction, or as a flat figure in pence for each transaction. Different MIFs apply to different types of transaction (such as contactless payments, or payments made where the card is not present, including internet payments). Different MIFs also apply to transactions depending on whether the issuer and acquirer are based in the same state/region or different states/regions. (ix) Under the Visa and Mastercard schemes, issuers and acquirers are not required to contract on the basis of the MIF. Under the rules, they are free to enter into bilateral agreements with different terms. In practice, however, issuers and acquirers do contract on the basis of the MIF, as both trial judges below found. (a) Popplewell J stated in Asda Stores Ltd v Mastercard Inc [2017] EWHC 93 (Comm); [2017] 4 CMLR 32, para 9 in relation to the Mastercard scheme: Interchange fees can in theory be agreed bilaterally between issuers and acquirers. In practice this is not how the interchange fee is determined. Under the Scheme Rules (Rule 8.3), MasterCard sets the interchange fees which are to apply compulsorily in default of bilateral agreements. These are the multilateral interchange fees or MIFs. In practice there are no material bilateral agreements, and so the MIF always applies. This is not surprising: in a putative bilateral negotiation between an issuer and an acquirer the issuer has no incentive to accept less than the default MIF and the acquirer no incentive to offer more. (b) Phillips J stated in Sainsburys Supermarkets Ltd v Visa Europe Services LLC [2017] EWHC 3047 (Comm); [2018] 2 All ER 611, para 102 in relation to the Visa scheme: Although a MIF is, in theory, only a default provision applying in the absence of agreement, it was common ground that no bilateral agreements as to Interchange Fees are in fact made in the UK market. The reason for that result is also common ground and is obvious: Issuers have no need or incentive to agree a lower fee than the MIF and Acquirers have no need or incentive to agree to a higher fee. Both sides of the negotiation have the certainty that transactions will, in the absence of agreement, proceed on the basis of settlement at par plus an Interchange Fee set at the level of the MIF, so neither has a reason to depart from that position and certainly no incentive to incur the significant costs of entering negotiations with multiple counterparties in the (probably forlorn) hope of persuading one or more of them to agree a position which deviated from the default. As all Acquirers are in the same position, Merchants have no ability to negotiate with them as to the MIF element of the MSC, which is passed on in full. Witnesses called by each of the Merchants (12 in total) gave evidence that their respective Acquirers refused to negotiate the MIF element of their charge, treating it as a pass through cost set by the Scheme. (x) For most of the claim period, the MIF typically accounted for some 90% of the MSC. Acquirers pass on all of the MIF, and the scheme fee, to merchants through the MSC, with negotiation between acquirers and merchants in respect of the MSC being limited to the level of the acquirers margin. In the present proceedings, the MIFs at issue flow from the acquirer to the issuer. In other words, they involve a deduction from the payment that the issuer makes to the acquirer to settle the transaction. This is sometimes referred to as a positive MIF. However, this is not universally the case for schemes of this kind. In principle, interchange fees could flow in the opposite direction (ie be added to the payment made by the issuer to the acquirer). There are some four party payment card schemes which operate on that basis. This is sometimes referred to as a negative MIF. Other schemes operate on the basis that, in the absence of a bilateral agreement between the issuer and acquirer, the issuer must settle the transaction at par without the deduction of an interchange fee. It was common ground that a rule specifying the terms on which the transaction is to be settled between issuer and acquirer, at least in default of bilateral agreement, is necessary in order for a four party payment card scheme to operate. It was also common ground that a rule providing for positive MIFs is not necessary for the operation of a four party payment card scheme. Visa and Mastercard do not receive any part of the MIF or the acquiring bank fee. Their remuneration comes from scheme fees paid by issuers and acquirers. The lawfulness of those scheme fees is not the subject of these proceedings. Four party payment card schemes, such as the Visa and Mastercard schemes, operate in what is described by economists as a two sided market: (i) On one side of the market, issuers compete with each other for the business of customers to whom they will issue cards (the issuing market). (ii) On the other side of the market, acquirers compete with each other for the business of merchants to whom they seek to offer acquiring services (the acquiring market). These proceedings concern the effect of MIFs on competition in the acquiring market. Four party payment card schemes are not the only type of payment card scheme. There are also three party payment card schemes, including those operated in the UK by American Express and Diners Club. In the original form of that type of scheme, the scheme operator (ie American Express or Diners Club) acts as both acquirer and issuer and clears payments itself. One of the scheme rules that both the Visa and Mastercard schemes also operate is an Honour All Cards Rule (HACR). This requires a merchant, having agreed with an acquirer to accept Visa or Mastercard branded payment cards, to accept all such cards, regardless of which issuer issued the cards. Merchants can choose to accept only certain categories of card (for example, only debit cards), in which case they would be obliged to accept all Visa or Mastercard branded cards in that category. The lawfulness of the HACR is not in dispute in these proceedings. The legal framework Articles 101(1) and 101(3) TFEU provide as follows: Article 101(1) The following shall be prohibited as incompatible with the internal market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between member states and which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which: limit or control production, markets, technical (a) directly or indirectly fix purchase or selling prices or any other trading conditions; (b) development, or investment; share markets or sources of supply; (c) (d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts. Article 101(3) The provisions of paragraph 1 may, however, be declared inapplicable in the case of: any agreement or category of agreements between undertakings, associations of undertakings, practices, any decision or category of decisions by any concerted practice or category of concerted which contributes to improving the production or distribution of goods or to promoting technical or economic progress, while impose on allowing consumers a fair share of the resulting benefit, and which does not: (a) the undertakings concerned restrictions which are not indispensable to the attainment of these objectives; afford such undertakings the possibility of (b) eliminating competition in respect of a substantial part of the products in question. Section 2 of the Competition Act 1998 (the 1998 Act) makes the same provision as article 101(1) in relation to agreements which may affect trade within the UK, and which prevent, restrict or distort competition within the UK. Section 2 is the counterpart of article 101(1) and section 9 is the counterpart of article 101(3). Section 60 of the 1998 Act sets out principles to be applied when determining questions under sections 2 and 9. It provides as follows: Principles to be applied in determining questions (1) The purpose of this section is to ensure that so far as is possible (having regard to any relevant differences between the provisions concerned), questions arising under this Part in relation to competition within the United Kingdom are dealt with in a manner which is consistent with the treatment of corresponding questions arising in [EU] law in relation to competition within the [European Union]. (2) At any time when the court determines a question arising under this Part, it must act (so far as is compatible with the provisions of this Part and whether or not it would otherwise be required to do so) with a view to securing that there is no inconsistency between the principles applied, and decision reached, by (a) the court in determining that question; and (b) the principles laid down by the Treaty and the European Court, and any relevant decision of that Court, as applicable at that time in determining any corresponding question arising in [EU] law. (3) The court must, in addition, have regard to any relevant decision or statement of the Commission. The regulatory history Both the Visa and the Mastercard schemes have been subject to scrutiny by national and European competition authorities and regulators over many years, including in relation to MIFs. The Court of Appeal included a summary of the regulatory background in its judgment: [2018] EWCA Civ 1536; [2019] Bus LR 198; [2019] 1 All ER 903, paras 12 36. Of particular relevance to the appeal is the European Commission (the Commission) decision of 19 December 2007 that the Mastercard MIFs applicable within the European Economic Area (EEA MIFs) had, since 22 May 1992, been in breach of article 101(1), and Mastercard had not proved to the requisite standard that any of the first three article 101(3) exemption criteria were met: Decision C (2007) 6474 in Cases COMP/34.579 MasterCard, COMP/36.518 EuroCommerce, and COMP/38.580 Commercial Cards (the Mastercard Commission Decision). Mastercard applied to the Court of Justice of the European Union (the CJEU) for the annulment of the Mastercard Commission Decision. On 24 May 2012, the General Court gave judgment dismissing Mastercards application: MasterCard Inc v European Commission (Case T 111/08) [2012] 5 CMLR 5 (Mastercard GC). Mastercard appealed the General Courts decision to the Court of Justice. On 11 September 2014, the Court of Justice gave judgment dismissing Mastercards appeal: MasterCard Inc v European Commission (Case C 382/12 P) [2014] 5 CMLR 23 (Mastercard CJ). The trial proceedings The appeal relates to three sets of proceedings: the Mastercard Sainsburys proceedings, the AAM proceedings and the Visa Sainsburys proceedings. In the Mastercard Sainsburys proceedings, Sainsburys issued a claim against Mastercard in the Chancery Division for damages for infringement of article 101(1) TFEU and section 2 of the 1998 Act, in respect of the Mastercard MIFs applicable to domestic transactions in the United Kingdom (UK MIFs) for the period 19 December 2006 onwards. The claim was transferred to the Competition Appeal Tribunal (the CAT) on 1 December 2015. A liability and quantum trial was heard in the CAT over 23 days in January to March 2016. Judgment was given on 14 July 2016, with the CAT finding that, from 2006 to 2015, the Mastercard UK MIFs restricted competition by effect: Sainsburys Supermarkets Ltd v MasterCard Inc [2016] CAT 11; [2016] Comp AR 33. Damages of around 68.5m were awarded to Sainsburys (and subsequently adjusted to take into account the impact of corporation tax). In the AAM proceedings, Asda and Morrisons issued like claims for damages against Mastercard, ultimately limited to the Mastercard UK MIFs since 23 May 2006 and the Mastercard EEA MIFs since 23 May 2007. Argos also issued a claim limited to the Mastercard UK MIFs since 5 October 2006, the Mastercard EEA MIFs from 5 October 2007, and Mastercards Irish domestic MIFs (Irish MIFs) from 5 October 2006 to 5 January 2007 and from 20 January 2009 onwards. The parties various claims were combined. A liability trial took place before Popplewell J in the Commercial Court in June to July, and September to October 2016. On 30 January 2017, Popplewell J dismissed the claims: Asda Stores Ltd v MasterCard Inc [2017] EWHC 93 (Comm); [2017] 4 CMLR 32. He found that, subject to what came to be called for shorthand the death spiral argument, Mastercards UK and Irish MIFs restricted competition in the acquiring market contrary to article 101(1), but that the effect of that argument was that they did not infringe that provision. He also held that Mastercards UK, Irish and EEA MIFs were exempt under article 101(3) in any event. In the Visa Sainsburys proceedings, Sainsburys issued like claims for damages against Visa in respect of the Visa UK MIFs since 18 December 2007. Sainsburys claim was heard by Phillips J in the Commercial Court in a 39 day trial of liability issues in the period 14 November 2016 to 1 March 2017. On 30 November 2017, Phillips J dismissed Sainsburys claim against Visa: Sainsburys Supermarkets Ltd v Visa Europe Services LLC [2017] EWHC 3047 (Comm); [2018] 2 All ER 611. Phillips J found that the Visa UK MIFs did not restrict competition in the acquiring market and the claim was dismissed (the Visa restriction judgment). On 23 February 2018, Phillips J gave a further judgment, at the request of the parties, although it was strictly obiter. He found that if, contrary to his conclusion in the Visa restriction judgment, the Visa UK MIFs did restrict competition, they were not exempt, at any level, under article 101(3) because Visa had not established to the requisite standard that the Visa UK MIFs caused any benefits to consumers: Sainsburys Supermarkets Ltd v Visa Europe Services LLC [2018] EWHC 355 (Comm); [2018] 4 CMLR 24 (the Visa exemption judgment). The judgments below and their essential reasoning are summarised by the Court of Appeal at paras 37 57 of its judgment. The Court of Appeal decision The Court of Appeal directed that the appeals in the Mastercard Sainsburys proceedings, the AAM proceedings and the Visa Sainsburys proceedings be heard together. There was a ten day hearing between 16 and 27 April 2018. Judgment was handed down on 4 July 2018, overturning all four of the judgments given below. As regards Popplewell Js judgment in the AAM proceedings, the Court of Appeal endorsed his view that Mastercards default MIFs involved a distortion of competition contrary to article 101(1), but disapproved his reasoning on the death spiral argument, with the result that the Mastercard default MIFs were found to infringe article 101(1). The Court of Appeal also overruled the judge in relation to his conclusion on Mastercards claim of exemption under article 101(3). It held that Mastercard had not advanced evidence at trial which was capable of substantiating its claim for exemption under that provision; therefore, the judge should have concluded that Mastercards claim for exemption failed. Despite this ruling regarding article 101(3) in the AAM proceedings, the Court of Appeal remitted the issues arising under article 101(3) in all three sets of proceedings to the CAT, for reconsideration together on the basis of the existing evidence which had been adduced in all three sets of proceedings. On 29 November 2018 Visa and Mastercard were given permission to appeal against the Court of Appeal decision on all grounds. On 6 November 2019 AAM were given permission to cross appeal against the order for remittal made by the Court of Appeal. The issues The issues which arise on the appeal are as follows: (i) Did the Court of Appeal err in law in finding that there was a restriction of competition in the acquiring market contrary to article 101(1) TFEU and equivalent national legislation? (the restriction issue) (ii) Did the Court of Appeal find, and if so did it err in law in finding, that Visa and Mastercard were required to satisfy a more onerous evidential standard than that normally applicable in civil litigation, in order to establish that their MIFs were exempt from the prohibition on restrictive agreements pursuant to article 101(3) TFEU, because of the economic benefits to which they contributed? (the standard of proof issue) (iii) Did the Court of Appeal err in law in finding that in order to show that consumers receive a fair share of the benefits generated by the MIFs, for the purpose of satisfying the test for exemption under article 101(3) TFEU, Visa was required to prove that the benefits provided to merchants alone as a result of the MIFs outweighed the costs arising from the MIFs, without taking any account of the benefits received by cardholders as a result of the MIFs? (the fair share issue) (iv) Did the Court of Appeal find, and if so did it err in law in finding, that a defendant has to prove the exact amount of loss mitigated in order to reduce damages? (the broad axe issue) If it arises, the issue on the cross appeal is whether the Court of Appeal erred in remitting the AAM proceedings for reconsideration in relation to exemption under article 101(3) (the remission issue). Issue (i) The restriction issue In the CAT proceedings, the CAT decided two issues which are no longer in dispute, namely that: (i) the MIF did not amount to a restriction of competition by object; and (ii) the restriction issue fell to be considered against a counterfactual in which the transactions would be settled at par by default, which was equivalent to a default MIF of zero. It is also not in dispute that the setting of the UK MIF was pursuant to an agreement between undertakings within the meaning of article 101(1) (see para 95 of the CAT judgment, para 34 of Popplewell Js judgment and para 5 of the Visa restriction judgment). The CAT considered that bilateral MIF agreements would be made in the counterfactual and made detailed findings on this basis. Both Popplewell J and Phillips J disagreed with this conclusion. As Phillips J stated at paras 126 129 of the Visa restriction judgment: 126. despite the fact that MIFs have provided a default level of Interchange Fee for many years bilateral agreements are unknown in the UK market. That demonstrates the very considerable strength of the market forces which keep the Interchange Fee at the level of the default: no party has persuaded another to move away from the default and no party has volunteered to do so for some perceived benefit. 129. In my judgment it would require clear evidence to support a finding that [bilateral agreements] would emerge in a default settlement counterfactual when they do not arise in the actual default Scheme it is clear that there is no such evidence in these proceedings. On the contrary, the evidence was unanimous and unequivocal to the opposite effect It is now common ground that Popplewell J and Phillips J were correct so to It follows that the findings made by the CAT on the counterfactual on the basis of bilateral agreements being made are not relevant to the appeal. In the AAM proceedings, Popplewell J would have found that the Mastercard MIFs were a restriction on competition were it not for the death spiral argument. That argument was not supported on appeal. The reason that he would otherwise have found that there was a restriction is summarised at para 156 of Popplewell Js judgment: 156. They [the MIFs] imposed a floor below which the MSC could not fall, because acquirers had to pay at least that much to issuers and had to recoup it from the merchants, which in turn led to higher prices charged by acquirers to merchants through the MSC than if the MIF were lower or zero. Such a floor restricts competition because it interferes with the ability of acquirers to compete for merchants business by offering MSCs below such floor. It is no different in kind from a collective agreement by manufacturers to maintain inflated wholesale prices, which prevents wholesalers competing on the retail market below those prices. Phillips J disagreed with this reasoning and conclusion. His main reason for doing so is set out at para 156 of the Visa restriction judgment: 156. the situation is exactly the same at any lower level of MIF, including a zero MIF or its equivalent, a no MIF/default SAP [settlement at par] counterfactual. At that lower level, the default settlement rule still provides a default level of Interchange Fee, and therefore (because of the lack of competitive pressure to depart from that default) both a floor and a ceiling for that fee. The only difference is the level. Popplewell J rejected that argument in the Asda Judgment, stating at para 160 that in a no MIF counterfactual the alleged vice is not the same as the actual: there is no floor. However, a zero MIF or no MIF/default SAP counterfactual most certainly does give rise to a floor, both in economic terms and as a matter of logic, particularly in the context of a two sided market: it prevents the possibility of market forces driving the MIF to a negative level (equivalent to a premium on settling the transaction price). As I have mentioned above, that is not merely a theoretical possibility, as all the expert economists recognised . The Court of Appeal held that it was bound to follow the decision in Mastercard CJ that the MIFs in issue restricted competition within the meaning of article 101(1). It stated that this was not a decision from which the Court either can or should depart. Its reasoning is summarised at paras 185 186 of the judgment: 185. Our conclusions on the primary article 101(1) issue can be summarised quite shortly. The correct counterfactual for schemes like the MasterCard and Visa schemes before us was identified by the [Court of Justices] decision. It was no default MIF and a prohibition on ex post pricing (or a settlement at par rule). The relevant counterfactual has to be likely and realistic in the actual context (see the O2 Germany GmbH & Co OHG case [2006] ECR II 1231, paras 68 71 [O2 Germany v Commission (Case T 328/03)] and the [Court of Justices] decision, para 169), but for schemes of this kind, the [Court of Justice] has decided that that test is satisfied. 186. The [Court of Justices] decision also made clear at para 195 that MasterCards MIFs, which resulted in higher prices, limited the pressure which merchants could exert on acquiring banks, resulting in a reduction in competition between acquirers as regards the amount of the merchants service charge. This is not a decision from which this court either can or should depart. It answers the schemes argument that, whether as a matter of evidence or not, the competitive process will not differ in the counterfactual. The default MIFs may be a transparent common cost, which is passed on by acquirers to merchants, and which does not figure in the negotiations between them, but it does not follow that acquirers none the less compete as strongly for merchants business in relation to the acquirers margin and the additional services they offer, as they would in the absence of the default MIFs. It follows that there are essentially two issues which arise: (i) whether, as the Court of Appeal held, the court is bound by the Mastercard CJ decision on the restriction issue; and (ii) if not, whether that decision ought to be followed. This requires a detailed consideration of what was decided by the Commission, the General Court and the Court of Justice, and of their reasoning. Is the court bound by Mastercard CJ? The Mastercard Commission Decision The decision is summarised at paras 396 405 of the Court of Appeal judgment. The restriction of competition identified by the decision is summarised in the Executive Summary, point 2, as follows: The MIF in MasterCards scheme restricts competition between acquiring banks by inflating the base on which acquiring banks set charges to merchants and thereby setting a floor under the merchant fee. In the absence of the multilateral interchange fee the merchant fees set by acquiring banks would be lower. This reflects the finding made at recital 410: MasterCards MIF constitutes a restriction of price competition in the acquiring markets. In the absence of a bilateral agreement, the multilateral default rule fixes the level of the interchange fee rate for all acquiring banks alike, thereby inflating the base on which acquiring banks set charges to merchants. Prices set by acquiring banks would be lower in the absence of this rule and in the presence of a rule that prohibits ex post pricing. The MasterCard MIF therefore creates an artificial cost base that is common for all acquirers and the merchant fee will typically reflect the costs of the MIF. This leads to a restriction of price competition between acquiring banks to the detriment of merchants (and subsequent purchasers). This is further explained at recital 448 as follows: The decisive question is whether in the absence of the MIF the prices acquirers charge to merchants at large would be lower. This is the case, because the price each individual bank could charge to merchants would be fully determined by competition rather than to a large extent by a collective decision among (or on behalf of) the banks. At recitals 455 to 460 the Commission addressed the argument of Mastercard and Visa (who had been allowed to participate in the proceedings) that the MIF was not a restriction because its effect would be like an excise tax. This argument is recorded at recital 219 in the following terms: At the oral hearing Visas expert also argued that it was hard to imagine how a multilaterally set interchange fee could possibly restrict competition between acquiring banks. Competition among acquirers could not be stronger with at par clearing than with a MIF, just as it would be hard to assume that breweries would compete more keenly if one scraps excise taxes. This is essentially the same argument as that advanced successfully by Visa before Phillips J and again on this appeal. In summary, in a counterfactual with settlement at par (equivalent to a zero rated MIF) there is no process of competition as to that default term of settlement, just as there would not be if there was a MIF, a common and transparent cost which is also a default term of settlement, not a price or charge. In both the factual scenario and the counterfactual, competition is limited to the acquirers individual marginal cost and mark up. There is accordingly no difference in the competitive process and no restriction on competition (the zero MIF argument). The Commission rejected this argument for the following reasons: 455. MasterCard puts forward that the interchange fee does not favour a particular acquirer or type of acquirer over other acquirers/types of acquirers. The interchange fee is a common identical cost, borne by all acquirers, that does not influence price competition between acquirers in terms of determining the level of MSCs. Visas expert raised a similar argument at the oral hearing by comparing the MIF to an excise tax. 457. even if one were to qualify a MIF as a kind of excise tax this is no reason why the MIF should fall outside article 81(1) of the Treaty [now article 101(1) TFEU]. The collective act of competing undertakings to raise charges for consumers is subject to the prohibition of article 81(1) of the Treaty. 458. If the concept of a restriction of competition within the meaning of article 81(1) of the Treaty had to be interpreted as MasterCard suggests, then article 81(1) of the Treaty would be entirely deprived of its effet utile. The MasterCard MIF not only creates an (artificial) common cost for acquirers and thereby sets a floor for the fees each acquirer charges to merchants. Acquirers also know precisely that all of their competitors pay the very same fees. The price floor and the transparency of it to all suppliers involved (that is to say the knowledge of each acquirer about the commonality of the MIF for all other acquirers in the MasterCard scheme) eliminate an element of uncertainty. 459. In the absence of MasterCards MIF, the prices acquirers charge to merchants would not take into account the artificial cost base of the MIF and would only be set taking into account the acquirers individual marginal cost and his mark up. 460. Statements of retailers demonstrate that they would be in a position to exert that pressure if acquirers were not able to refer to interchange fee as the starting point (that is to say, as the floor) for negotiating the MSC. This is because without a default that fixes an interchange fee rate in the absence of a bilateral agreement, merchants could shop around to contract with the acquirer who incurs the lowest interchange costs.517 Acquirers who bilaterally agree to pay relatively high interchange fees to issuers would ultimately not remain competitive, as other acquirers could undercut their merchant fees by refusing to enter into bilateral agreements with issuers or by agreeing on relatively lower interchange fees. The uncertainty of each individual acquirer about the level of interchange fees which competitors bilaterally agree to pay to issuers would exercise a constraint on acquirers. In the long run this process can be expected to lead to the establishment of inter bank claims and debts at the face value of the payment that is without deducting any interchange fees. A multilateral rule that by default sets a certain interchange fee rate in the absence of bilateral negotiations prevents this competitive process. In the absence of such a rule (and in the presence of a prohibition of ex post pricing) acquiring banks would eventually end up setting their MSCs merely by taking into account their own marginal cost plus a certain mark up. Footnote 517 to para 460 provides as follows: Note that in the Commissions view in the absence of a default MIF banks may or may not enter into bilateral agreements on interchange fees. The existence of such bilaterally agreed interchange fees is no pre requisite for the viability of the MasterCard payment card scheme. In the absence of a default MIF prices are established on both sides of the MasterCard scheme as set out in section 7.3.4.1, ie: each bank determines its service levels and prices in a manner that maximises its individual profits. Mastercard GC Mastercard applied to the CJEU for annulment of the Commissions decision. Its application was determined by the General Court. The General Courts decision is summarised at paras 406 411 of the Court of Appeal judgment. On the restriction issue the General Court summarised the Commissions reasoning and conclusion as follows: 28. According to the Commission, the members of the MasterCard payment organisation collectively exert market power vis vis merchants and their customers. Thus, the MIF had the effect of inflating the base of the MSC, while the latter could be lower if there were no MIF and if there were a prohibition of unilateral pricing a posteriori of transactions by the issuing banks (prohibition of ex post pricing). It follows from this that the MIF examined by the Commission in the contested decision led to a restriction of price competition between acquiring banks to the detriment of merchants and their customers (recitals 410, 411 and 522 to the contested decision). The General Court addressed the complaints made relating to the assessment of competition in the absence of the MIF at paras 129 167. At para 140 it made the following general observation about the purpose of article 101(1)(a): 140. it is helpful to point out that article 81(1)(a) EC [now article 101(1)(a) TFEU] expressly provides that measures which directly or indirectly fix purchase or selling prices constitute restrictions of competition, and that, according to the case law, the purpose of article 81(1)(a) EC is to prohibit undertakings from distorting the normal formation of prices on the markets (ICI v Commission (Case T 13/89) [1992] ECR II 1021, para 311). At para 142 the General Court set out the complaint made based on the zero MIF argument: 142. the applicants submit, in essence, that the fact that the MIF had an impact on the level of the MSC does not affect competition between acquirers, because the MIF applies in the same way to all acquirers and operates as a cost that is common to all of them. Thus, the prohibition of ex post pricing would effectively impose a MIF set at zero which, from a competitive aspect, would be equivalent to and just as transparent as the current MIF, the only difference being the level at which it is set. The General Court rejected this argument and set out its conclusion at para 143 as follows: 143. This line of argument cannot be accepted. Since it is acknowledged that the MIF sets a floor for the MSC and in so far as the Commission was legitimately entitled to find that a MasterCard system operating without a MIF would remain economically viable, it necessarily follows that the MIF has effects restrictive of competition. By comparison with an acquiring market operating without them, the MIF limits the pressure which merchants can exert on acquiring banks when negotiating the MSC by reducing the possibility of prices dropping below a certain threshold. Mastercard CJ Mastercard appealed against the General Courts decision to the Court of Justice. The Advocate General recommended that the appeal be dismissed. He summarised the Commissions reasoning and conclusion as follows: AG6 In the decision at issue, the Commission considered that the decisions setting the MIF, which it characterised as decisions of an association of undertakings within the meaning of article 81(1) EC, restrict competition between acquiring banks and thereby infringe that article and article 53 of the EEA Agreement, in that they amount in fact to setting a minimum price for the MSC AG54 In the present case, the Commission examined the competitive process that would have developed on the acquiring market in the absence of the MIF at recitals 458 to 460 to the decision at issue and concluded that, in the absence of the MIF and with a prohibition on ex post pricing, the prices charged to merchants by acquirers would only be set taking into account the acquirers individual marginal cost and his mark up. The Court of Justices decision is summarised at paras 412 417 of the Court of Appeal judgment. The Court of Justice explained and affirmed the General Courts conclusion at para 143 of its judgment in the following terms: 193. In particular, while the General Court clearly explained in para 143 of the judgment under appeal that the MIF had restrictive effects in that they: [limit] the pressure which merchants can exert on acquiring banks when negotiating the MSC by reducing the possibility of prices dropping below a certain threshold, in contrast with an acquiring market operating without them, the General Court did not merely presume that the MIF set a floor for the MSC but, on the contrary, proceeded to carry out a detailed examination in paras 157 to 165 of the judgment under appeal in order to determine whether that was in fact the case. The Court of Justice endorsed the General Courts rejection of the zero MIF argument in the following terms: 195. the appellants cannot criticise the General Court for having failed to explain how the hypothesis applied had less restrictive effects on competition than the MIF, given that the only difference between the two situations lies in the pricing level of the MIF. As the Commission rightly points out, the judgment under appeal is not based on the premiss that high prices in themselves constitute an infringement of article 81(1) EC. On the contrary, as is apparent from the very wording of para 143 of the judgment under appeal, high prices merely arise as the result of the MIF which limit the pressure which merchants could exert on acquiring banks, with a resulting reduction in competition between acquirers as regards the amount of the MSC. Visa and Mastercards arguments Ms Dinah Rose QC for Visa (whose argument is adopted and supported by Mr Mark Hoskins QC for Mastercard) submits that the Court of Appeal was wrong to conclude that it was bound by Mastercard CJ. The decisions of the Court of Justice and the General Court depended on the factual basis of the Mastercard Commission Decision. Crucial to that factual basis was the Commissions determination on the evidence before it that the competitive pressure which could be brought to bear on acquirers by merchants is greater in the counterfactual because of the possibility of bilateral negotiations of interchange fees and the uncertainty that that would create. Ms Rose relies in particular on para 460 of the Mastercard Commission Decision which describes how, if there were no default MIF, merchants could shop around to contract with the acquirer who incurs the lowest interchange costs and how the uncertainty of each individual acquirer about the level of interchange fees which competitors bilaterally agree to pay to issuers would exercise a constraint on acquirers. This is the pressure which merchants would be able to exert in the counterfactual, as borne out by statements of retailers. This is to be contrasted with the evidence before and the findings made by Phillips J in the Visa restriction judgment. He found that there would be no bilateral agreements in the counterfactual (para 129) and no resulting competition (para 151). It followed that there would be no competitive pressure as found by the Commission. Ms Rose submits that this is the pressure referred to in para 143 of Mastercard GC and para 195 of Mastercard CJ. In para 195 the Court of Justice was making it clear that the Commissions finding of infringement had been upheld by the General Court because of the Commissions findings that MIFs limit this pressure which merchants could otherwise exert on acquirers, thereby reducing competition between acquirers. Mastercard CJ is accordingly factually distinguishable. It turned on the factual assessment made by the Commission which was different to that made by Phillips J. Although Popplewell J did not make the same findings as Phillips J, he also found that there would be no bilateral agreements in the counterfactual, which is a critical difference in the factual assessment. It is well established that a court is not bound by factual assessments made by the Commission Crehan v Inntrepreneur Pub Co (CPC) (Office of Fair Trading intervening) [2007] 1 AC 333; [2006] UKHL 38. The Court of Appeal was therefore wrong to conclude that it was bound by Mastercard CJ. In our judgment Visa and Mastercards arguments involve a misinterpretation of the Mastercard Commission Decision, Mastercard GC and Mastercard CJ. In relation to the Mastercard Commission Decision, in the section of the decision relied upon by Visa and Mastercard, recital 459, read in the context of recitals 457 and 458, is as important as recital 460. Recital 459 bears repetition; it states: In the absence of MasterCards MIF, the prices acquirers charge to merchants would not take into account the artificial cost base of the MIF and would only be set taking into account the acquirers individual marginal cost and his mark up. The Commission was here focusing on the process by which merchants bargain with acquirers over the MSC. It was contrasting the position where that charge is negotiated by reference to a minimum price floor set by the MIF and one where it is negotiated by reference only to the acquirers individual marginal cost and his mark up ie between a situation in which the charge is only partly determined by competition and one in which it is fully determined by competition. In the latter situation the merchants have the ability to force down the charge to the acquirers individual marginal cost and his mark up and to negotiate on that basis. This is the pressure which is referred to in recital 460 of the decision. This is made clear by the reference in the first sentence of recital 460 to that pressure ie the pressure referred to in recital 459. It is correct that the Commission went on in recital 460 to describe the competitive process involved if there were bilateral negotiations over interchange fees, but the ultimate point it was here making is that that process would be transient and that acquiring banks would eventually end up setting their MSCs merely by taking into account their own marginal cost plus a certain mark up. The transient nature of such a competitive process shows that the existence of such a process cannot have been integral to the Commissions decision that there was a restriction on competition. This is further borne out by footnote 517 in which the Commission stated that in the counterfactual banks may or may not enter into bilateral agreements on interchange fees, thereby making it clear that such agreements were not essential to its reasoning. Mastercard GC is properly to be interpreted in a similar way. In para 143 the General Court rejected the zero MIF argument and held that since the MIF sets a minimum price floor for the MSC (which is not determined by competition) it necessarily follows that the MIF has effects restrictive of competition. This is the context in which the pressure referred to in the next sentence falls to be considered. The consequence of the minimum price floor set by the MIF is that such pressure is limited to only part of the MSC ie that relating to the acquirers individual marginal cost and mark up (in the present case about 10% of the MSC). A similar analysis applies to Mastercard CJ. The pressure which the Court of Justice referred to at para 195 is the same as that referred to in para 143 of Mastercard GC, which the Court of Justice was endorsing. Accordingly, we do not consider that Mastercard CJ can be factually distinguished in the manner suggested by Visa and Mastercard. Visa and Mastercard further contend that the recent decision of the Court of Justice in Gazdasgi Versenyhivatal v Budapest Bank Nyrt (Case C 228/18) EU:C:2020:265 (Budapest Bank) established that the question whether MIFs that set a floor under the MSC restrict competition has not been settled by Mastercard CJ, but must be determined by a national court by carrying out an in depth evidential examination of its effects, and that this was contrary to the judgment of the Court of Appeal. The Court of Justices decision in Budapest Bank was pronounced after the conclusion of the hearing of this appeal but the parties were allowed to make written submissions as to its significance. The Advocate Generals opinion had already been referred to in argument. Budapest Bank concerned an agreement made by banks that participated in both the Visa and Mastercard schemes in Hungary, by which they agreed on a uniform MIF that was applicable to both schemes. It was argued by the parties in the national proceedings that the agreement had the effect of preventing the fees from escalating upwards. The issue in the proceedings was whether the agreement had the object of restricting competition. It did not concern whether it had the effect of so doing. The Hungarian Supreme Court referred four questions to the CJEU for a preliminary ruling. The second question concerned whether the MIF agreement had the object of restricting competition. The Court of Justice ruled that it would only do so if the agreement in the light of its wording, its objectives and its context, can be regarded as posing a sufficient degree of harm to competition to be classified thus, a matter which is for the referring court to determine. In so ruling the Court of Justice rejected the Commissions argument that, in reliance on Mastercard CJ, the MIF agreement necessarily had the object of restricting competition. Particular reliance is placed by Visa and Mastercard on paras 78 79 of the judgment which state: 78. Second, as regards the acquiring market in Hungary, even assuming that the MIF Agreement had inter alia as its objective the fixing of a minimum threshold applicable to the service charges, the Court has not been provided with sufficient information to establish that that agreement posed a sufficient degree of harm to competition on that market for a restriction of competition by object to be found to exist. It is, however, for the referring court to carry out the necessary verifications in that respect. In particular, in the present instance, subject to those 79. verifications, it is not possible to conclude on the basis of the information produced for this purpose that sufficiently general and consistent experience exists for the view to be taken that the harmfulness of an agreement such as that at issue in the main proceedings to competition justifies dispensing with any examination of the specific effects of that agreement on competition. The information relied on by the Competition Authority, the Hungarian Government and the Commission in that connection, that is to say, primarily, that authoritys decision making practice and the case law of the Courts of the European Union, specifically demonstrates, as things currently stand, the need to conduct an in depth examination of the effects of such an agreement in order to ascertain whether it actually had the effect of introducing a minimum threshold applicable to the service charges and whether, having regard to the situation which would have prevailed if that agreement had not existed, the agreement was restrictive of competition by virtue of its effects. Visa and Mastercard contend that this shows that MIFs do not necessarily affect competition and that whether or not they do so is to be determined by the national court carrying out an in depth examination of its effects on competition in the actual and counterfactual markets. It is surprising that so much reliance should now be placed by Visa and Mastercard on Budapest Bank. At the hearing it was recognised by Visa that it raised a different question. As stated at para 116 of Visas written case: That case concerned the question whether an agreement between a number of Hungarian banks introducing a uniform MIF for both Visa and Mastercard credit card transactions in Hungary should be characterised as having the object of restricting competition. It was therefore quite a different question from that which the CJEU had considered in Mastercard CJEU, in that it concerned alleged infringements by object rather than effect, and a single agreement covering both Visa and Mastercard, rather than one schemes rules applicable only to its own system. In our judgment the case can clearly be distinguished in that: (i) it concerned restriction by object rather than effect; (ii) it involved a different type of MIF agreement and, in particular, one which was said to prevent escalating interchange fees; and (iii) it involved a different counterfactual, namely one where each scheme had its own MIF rather than there being no MIF. The fact that the Commission sought to rely on Mastercard CJ in argument does not affect these important distinctions, all the more so given that the Commissions attempt to read across from an effect case to an object case was rejected by the Court of Justice. In any event, in the present case there has been an examination by all courts of the effects of the MIF on competition in the actual and counterfactual markets, including whether it operates as a price floor. The issue is whether the effects as found are materially the same so that the same legal conclusion is to be drawn as in Mastercard CJ. For all these reasons, in our judgment Budapest Bank does not support Visa and Mastercards case on the restriction issue. Still less, as is boldly submitted, is it determinative in their favour. Whether Mastercard CJ is binding depends upon whether the findings upon which that decision is based are materially distinguishable from those made or accepted in the present appeals. We have rejected Visa and Mastercards arguments that it can be distinguished in the manner suggested by them and that their case is made out or supported by Budapest Bank. In our judgment, the essential factual basis upon which the Court of Justice held that there was a restriction on competition is mirrored in these appeals. Those facts include that: (i) the MIF is determined by a collective agreement between undertakings; (ii) it has the effect of setting a minimum price floor for the MSC; (iii) the non negotiable MIF element of the MSC is set by collective agreement rather than by competition; (iv) the counterfactual is no default MIF with settlement at par (that is, a prohibition on ex post pricing); (v) in the counterfactual there would ultimately be no bilaterally agreed interchange fees; and (vi) in the counterfactual the whole of the MSC would be determined by competition and the MSC would be lower. For all these reasons we conclude that Mastercard CJ is binding and that the Court of Appeal was correct so to hold. Should the court follow Mastercard CJ? In the light of our conclusion that this Court is bound by Mastercard CJ this further issue does not arise. Given the importance of the issues raised and the detailed arguments presented, we shall nevertheless briefly address it. Under article 101(1) an agreement between undertakings which has the effect of directly or indirectly fixing purchase or selling prices is a restriction of competition under article 101(1)(a). It is well established that the prohibition of price fixing under article 101(1) also extends to the fixing of part of the price Krupp Thyssen Stainless GmbH v Commission of the European Communities (Joined Cases T 45/98 and T 47/98) [2001] ECR II 3757; [2002] 4 CMLR 15, paras 156 157. The relevant selling price in the present appeals is the MSC. On the facts as found, the effect of the collective agreement to set the MIF is to fix a minimum price floor for the MSC. In the words of Mr Dryden, AAMs expert economist, it sets a reservation price. That minimum price is non negotiable. It is immunised from competitive bargaining. Acquirers have no incentive to compete over that part of the price. It is a known common cost which acquirers know they can pass on in full and do so. Merchants have no ability to negotiate it down. Whilst it is correct that higher prices resulting from a MIF do not in themselves mean there is a restriction on competition, it is different where such higher prices result from a collective agreement and are non negotiable. Whilst it is also correct that settlement at par sets a floor, it is a floor which reflects the value of the transaction. Unlike the MIF, it involves no charge resulting from a collective agreement, still less a positive financial charge. There is a clear contrast in terms of competition between the real world in which the MIF sets a minimum or reservation price for the MSC and the counterfactual world in which there is no MIF but settlement at par. In the former a significant portion of the MSC is immunised from competitive bargaining between acquirers and merchants owing to the collective agreement made. In the latter the whole of the MSC is open to competitive bargaining. In other words, instead of the MSC being to a large extent determined by a collective agreement it is fully determined by competition and is significantly lower. For all these reasons, which are essentially the same as those given by the Commission, the General Court, the Court of Justice, Popplewell J and the Court of Appeal, even if we were not bound by Mastercard CJ, we would follow it and conclude that there was in the present cases a restriction on competition. Conclusion on the restriction issue For these reasons we dismiss the appeal on issue (i). Issue (ii) The standard of proof issue This ground of appeal is advanced jointly by Visa and Mastercard. They submit that the Court of Appeal erred in law insofar as it concluded that, in relation to article 101(3) TFEU: (i) there is a specific requirement for robust and cogent evidence, which is a more onerous standard than that under the normal domestic civil standard of proof on the balance of probabilities; and (ii) there is a legal requirement that matters required to be considered have to be proved by facts and empirical data. We are concerned here with circumstances in which a party in breach of article 101(1) seeks exemption by satisfying the requirements of article 101(3). The following four conditions must be satisfied. First, the anti competitive conduct must contribute to improving the production or distribution of goods or to promoting technical or economic progress. Secondly, consumers must be allowed a fair share of the resulting benefit. Thirdly, it must not impose on the participating undertakings any restrictions which are not indispensable to the attainment of these objectives. Fourthly, it must not afford them the possibility of eliminating competition in respect of a substantial part of the products in question. (See, for example, GlaxoSmithKline Services Unlimited v Commission of the European Communities (Case T 168/01) [2006] ECR II 2969; [2006] 5 CMLR 29 (GlaxoSmithKline), para 234.) It is common ground between the parties that if the restriction on competition established under article 101(1) is to be justified, the burden of satisfying the four conditions set out in article 101(3) lies on the defendant. Visa and Mastercard describe the present issue as relating to the standard of proof. Visa and Mastercard maintain that in the first instance proceedings in the Commercial Court the judges adopted diverging views as to the standard of proof and the nature of the evidence required to satisfy that standard. In the AAM proceedings, Popplewell J followed the orthodox common law approach that the standard of proof is the balance of probabilities and that there is no additional requirement as to the evidence which is capable of satisfying that standard. In the context of exemption the requirement for substantiation is no more than a requirement for evidence, and the suggestion that it needs to be empirical and convincing means no more than that it must be based on evidence, not speculation, and be sufficient to convince the court to the requisite standard of proof which is the balance of probabilities. If the epithet robust is intended to add more and connote an enhanced standard of proof, it is difficult to discern any legal basis for such an approach, (at para 305) In the Visa exemption judgment, Phillips J referred to the agreement between the parties that it was for Visa to establish on the balance of probabilities that its UK MIFs at a particular level are or were exempt. He went on to address the relationship of that standard of proof with the requirement under EU law (citing the Mastercard Commission Decision at para 690) that the claim that a restrictive agreement creates efficiencies must be founded on detailed, robust and compelling analysis and that assumptions and deductions be based on empirical data and facts. In my judgment the distinction being drawn is between: (a) real links to real efficiencies, capable of being observed and demonstrated on the facts by evidence (in other words, requiring empirical data); and (b) theoretical or logically assumed links and efficiencies based on broad economic or logical analysis, opinion or anecdotal evidence, perhaps sound in theory but possibly failing to take into account one or more of the many factors which arise in highly complex interactions in the real economy. I see no difficulty in this court determining whether the former has been proved on the balance of probabilities. That test is capable of accommodating varying requirements as to what is expected to meet the standard: contract terms must be certain, allegations of fraud must be distinctly proved and it is often said that cogent evidence is required to rebut certain presumptions. In the case of article 101(3), it is recognised that robust analysis and cogent evidence will be required to establish, on the balance of probabilities, that a restrictive agreement in fact and in the real world (as opposed to in theory) gives rise to pro competitive effects. (at para 24) Phillips J went on to state (at para 25) that in his view this analysis did not differ significantly from that of Popplewell J. The Court of Appeal began its consideration of the conditions for exemption under article 101(3) with the following uncontroversial statement: 77. Pursuant to article 2 of the Modernisation Regulation [Council Regulation (EC) No 1/2003 on the implementation of Treaty competition rules (OJ 2003 L1, p 1)] the burden of proving that these cumulative conditions are satisfied is upon the schemes. Recital 5 to the [Modernisation] Regulation makes it clear, however, that the standard of proof is for the national law, so that the usual civil standard of the balance of probabilities applies. It then adopted para 24 of the Visa exemption judgment of Phillips J and continued: 80. We agree with Phillips J (at para 25 of that judgment), that this analysis does not differ significantly from that of Popplewell J at para 305 of his judgment, but to the extent that there are any differences, we prefer the analysis of Phillips J. In so far as Ms Dinah Rose QC, leading counsel for Visa, sought to argue that Phillips J adopted too prescriptive an approach and that any evidence should suffice provided it meets the civil standard of proof, we do not accept that argument. We consider that Phillips J was right that regard should be had to the requirement of the Commission and the CJEU for cogent and convincing arguments and evidence (see GlaxoSmithKline Services Unlimited v Commission of the European Communities (Case T 168/01) EU:T:2006:265, [2006] ECR II 2969; [2006] 5 CMLR 1623 para 235, which was applied and followed in the General Courts decision in MasterCard at para 196). 81. Although the standard of proof is a matter of English law, the nature of the evidence which will satisfy that standard must be informed by European Union law and Commission decisional practice since, ultimately, whether a party is entitled to exemption involves the application of a European treaty. Furthermore, in that context, it is important to maintain a consistency of approach across member states as to the requirements of article 101(3). Other passages in the judgment of the Court of Appeal (paras 85, 86 and 249) demonstrate that it considered that EU law requires cogent factual and empirical evidence to satisfy article 101(3). In particular, the Court of Appeal (at paras 84 and 85) derived from the Commission Guidelines on the application of what is now article 101(3) TFEU (2004/C 101/8) (the Guidelines) and the EU jurisprudence on article 101(3), first, a need for the relevant benefits to be causally linked to the relevant restriction and, secondly, for that causal link to be established by facts and evidence supported by empirical analysis and data and not just economic theory. It added (at para 86): Thirdly, as para 54 of the Guidelines makes clear, the causal link must be sufficiently direct to be capable of proof and an indirect effect will not generally be sufficient, precisely because cogent evidence of the link based on empirical analysis and data and not merely economic theory is required. It is convenient to observe at this point that, contrary to the submission of Mastercard, the Court of Appeal did not conclude that only facts and empirical data but not economic theory may be relied upon in this regard. The Court of Appeal made clear that its objection was to reliance solely on economic theory and that, in its view, a claim under article 101(3) must be based on empirical data and fact and not economic theory alone (paras 85 and 86). Visa and Mastercard complain that the Court of Appeal wrongly adopted an unduly onerous standard of proof. They take as their starting point Council Regulation (EC) No 1/2003 on the implementation of Treaty competition rules (the Modernisation Regulation). The major change effected by the Modernisation Regulation was that whereas previously the grant of exemption from the prohibition on agreements which restrict competition had been the exclusive function of the European Commission, the Modernisation Regulation introduced a directly applicable exception system in which the competition authorities and courts of the member states have the power to apply the exemption provisions under what is now article 101(3). The previous system of notification to the Commission for exemptions was abolished and the widespread involvement of national courts and authorities in exempting restrictive agreements was clearly contemplated. It is in this context that recital 5 of the Preamble states: In order to ensure an effective enforcement of the Community competition rules and at the same time the respect of fundamental rights of defence, this Regulation should regulate the burden of proof under articles 81 and 82 [now articles 101 and 102] of the Treaty. It should be for the party or the authority alleging an infringement of article 81(1) and article 82 of the Treaty to prove the existence thereof to the required legal standard. It should be for the undertaking or association of undertakings invoking the benefit of a defence against a finding of an infringement to demonstrate to the required legal standard that the conditions for applying such defence are satisfied. This Regulation affects neither national rules on the standard of proof nor obligations of competition authorities and courts of the member states to ascertain the relevant facts of a case, provided that such rules and obligations are compatible with general principles of Community law. Similarly, article 2 which bears the heading Burden of proof provides: In any national or Community proceedings for the application of articles 81 and 82 of the Treaty, the burden of proving an infringement of article 81(1) or of article 82 of the Treaty shall rest on the party or the authority alleging the infringement. The undertaking or association of undertakings claiming the benefit of article 81(3) of the Treaty shall bear the burden of proving that the conditions of that paragraph are fulfilled. There is, accordingly, a clear allocation of the burden of proof, while questions as to the standard of proof are left to the law of the member state concerned, provided that the national rules are compatible with general principles of EU law. Visa and Mastercard submit, therefore, that EU law expressly reserves the question of the standard of proof to national law, subject to the principles of effectiveness and equivalence. In this regard, Visa and Mastercard rely further on the following passage in the decision of the Court of Justice in Eturas UAB v Lietuvos Respublikos konkurencijos taryba (Case C 74/14) [2016] 4 CMLR 19, paras 30 32: 30. Although article 2 of Regulation No 1/2003 expressly governs the allocation of the burden of proof, that regulation does not contain any provisions on more specific procedural aspects. Thus, in particular, that regulation does not contain any provision in relation to the principles governing the assessment of evidence and the standard of proof in national proceedings for the application of article 101 TFEU. 31. That conclusion is confirmed by recital 5 of Regulation No 1/2003, which expressly states that the regulation does not affect national rules on the standard of proof. 32. According to settled case law, in the absence of EU rules on the matter, it is for the national legal order of each member state to establish them in accordance with the principle of procedural autonomy, provided, however, that those rules are not less favourable than those governing similar domestic situations (principle of equivalence) and that they do not make it excessively difficult or impossible in practice to exercise the rights conferred by EU law (principle of effectiveness) This passage, however, is not as helpful to Visa and Mastercard as might at first appear. The issue in that case, which was a reference from the Supreme Administrative Court of Lithuania in proceedings where an anti competitive concerted practice was alleged, was whether certain evidence was sufficient proof of a fact which, if established, would trigger a presumption of liability under article 101(1). The passage in the judgment of the Court of Justice at paras 30 32, cited above, was concerned with the specific question whether the dispatch of a message through an electronic system may constitute sufficient evidence to establish that the operators which used the system were aware, or ought to have been aware, of the content of that message. Unsurprisingly, the Court of Justice held that, in accordance with the principle of procedural autonomy, the standard of proof in relation to establishing that fact was a matter for the national legal order of the member state concerned. The Court of Justice went on, however, (at para 33) to distinguish the presumption arising under article 101(1) of a causal connection between a concertation and the market conduct of the undertakings participating in the practice. That presumption, it emphasised, followed from article 101(1) and consequently formed an integral part of the EU law which the national court was required to apply. The Court of Justice then went on (at paras 46 49) to address in detail the nature of the evidence that would be sufficient to rebut the presumption. In our view, the fact that the Court of Justice in Eturas addressed, as a question of EU law, what evidence was capable of rebutting the presumption of participation in a concerted practice provides the key to resolving the present issue. In that case Advocate General Szpunar observed (at AG100), with regard to rebuttable presumptions in competition law: Insofar as such presumptions stem from article 101(1) TFEU, as interpreted by the court, and consequently form an integral part of applicable EU law, they do not fall within the scope of the principle of the autonomy of national procedural law and are therefore binding on national authorities when they apply EU competition rules. As Mr Nicholas Khan QC, on behalf of the Commission, put it in his oral submissions, Eturas illustrates how the nature of the evidence by which a finding of infringement can be secured or rebutted may be a question of EU law. In the same way, the nature of the evidence by which an undertaking may establish that a restriction on competition is exempted by virtue of article 101(3) may also be a question of EU law. In the present case, the essential complaint made by Visa and Mastercard under this ground of appeal does not relate to the standard of proof but to the nature of the evidence required to meet the standard of proof in this context. More specifically, it relates to the type of evidence needed to establish that the benefits from the MIF rules under consideration outweigh the detriments to merchants and are indispensable for achieving those benefits. The Court of Appeal recognised this distinction at paras 77 to 81 of its judgment, where it expressly accepted that the applicable standard of proof was the usual civil standard of the balance of probabilities but observed that the nature of the evidence which will satisfy that standard must be informed by EU law and Commission decisional practice. While the Modernisation Regulation recognises the autonomy of member states in determining the legal test for the standard of proof under article 101(3), it does not recognise any autonomy in the member states to determine the nature of the evidence required to satisfy that standard. The outcome on this issue, therefore, does not depend on Visa and Mastercard upholding national procedural rules about the standard of proof but on whether EU law imposes requirements as to what type of evidence is capable of discharging that burden. It is clear, in our view, that article 101(3) does impose requirements as to the nature of the evidence which is capable of discharging the burden on an undertaking to establish an exemption under that provision. Section 60 of the 1998 Act imports these requirements into domestic competition law. Article 101(3) is founded on the notion that notwithstanding the existence of a restriction on competition and its likely negative effect on competition and consumers, efficiencies and benefits arising from the conduct which gave rise to the restriction may, nevertheless, justify exemption from the prohibition in article 101(1). This is an inherently empirical proposition and necessarily requires the authority or court addressing the issue to carry out a balancing exercise a complex assessment (GlaxoSmithKline, Court of First Instance, at paras 241, 304 and 307) involving weighing the pro competitive effect against the anti competitive effect of the conduct in question. Cogent empirical evidence is necessary in order to carry out the required evaluation of the claimed efficiencies and benefits. To the extent that objective efficiencies caused by a restriction cannot be established empirically, they cannot be balanced with the restrictive effects. As a result, although the standard of proof is a matter of domestic law, the nature of the evidence which will satisfy that standard must take account of the substantive requirements of article 101(3). This view is confirmed by the practice of the Commission and the judgments of the EU courts. The Guidelines were issued in 2004, in part to assist national courts and authorities in member states in undertaking what was for them the new role of applying article 101(3). The Guidelines are not binding but they are based on the experience and expertise of the Commission which had previously had sole responsibility for carrying out the balancing test and granting exemptions, and they provide an analytical framework for the application of article 101(3). In particular, they address (at paras 50 and 51) what is involved in identifying and evaluating the causal link between a restriction of competition and the creation of an efficiency and they cast light on this balancing exercise. 50. The purpose of the first condition of [article 101(3)] is to define the types of efficiency gains that can be taken into account and be subject to the further tests of the second and third conditions of [article 101(3)]. The aim of the analysis is to ascertain what are the objective benefits created by the agreement and what is the economic importance of such efficiencies. Given that for [article 101(3)] to apply the pro competitive effects flowing from the agreement must outweigh its anti competitive effects, it is necessary to verify what is the link between the agreement and the claimed efficiencies and what is the value of these efficiencies. 51. All efficiency claims must therefore be substantiated so that the following can be verified: (a) The nature of the claimed efficiencies; (b) The link between the agreement and the efficiencies; (c) The likelihood and magnitude of each claimed efficiency; and (d) How and when each claimed efficiency would be achieved. (Original emphasis) This procedure requires the party seeking exemption to identify, substantiate and evaluate the claimed efficiencies and to verify their causal link with the anti competitive conduct as a pre condition to the balancing process which could not otherwise take place. There is a requirement for detailed, empirical evidence and analysis in order that this evaluative exercise can be carried out. In its judgment in GlaxoSmithKline (which was upheld by the Court of Justice, Third Chamber, GlaxoSmithKline Services Unlimited v Commission of the European Communities (Joined Cases C 501/06 P, C 513/06 P, C 515/06 P and C 519/06 P) [2009] ECR I 9291; [2010] 4 CMLR 2), the Court of First Instance (Fourth Chamber, Extended Composition) observed (at para 235) that a person seeking to rely on what is now article 101(3) must demonstrate that its conditions are satisfied, by means of convincing arguments and evidence. Referring to the reviewing jurisdiction of the Court of First Instance it noted (at para 242) that it is for the court to establish not only whether the evidence relied on is factually accurate, reliable and consistent, but also whether it contains all the information which must be taken into account for the purpose of assessing a complex situation and whether it is capable of substantiating the conclusions drawn from it. With regard to the first condition it observed (at para 248): It is therefore for the Commission, in the first place, to examine whether the factual arguments and the evidence submitted to it show, in a convincing manner, that the agreement in question must enable appreciable objective advantages to be obtained (See also paras 249, 263, 304, 307) We are unable to accept the submission on behalf of Visa, that in GlaxoSmithKline the evidential basis for the application for article 101(3) which was accepted by the Court of First Instance was almost entirely theoretical and based on economic studies. Having referred (at para 235) to the need for convincing arguments and evidence to demonstrate that the conditions of article 101(3) were satisfied, the General Court referred (at para 256) to the items of economic or econometric evidence submitted by GSK during the administrative procedure. The description of that material at paras 258 and 259 shows that it essentially comprised empirical evidence. The General Court observed (at para 263) that the factual arguments and the supporting evidence submitted by GSK appeared to be relevant, reliable and credible, having regard to their content which was corroborated in a number of significant aspects by documents originating with the Commission. This approach was followed in the Mastercard Commission Decision. There, the Commission stated (at recital 671): Given that for [article 101(3)] of the Treaty to apply the pro competitive effects flowing from the agreement must outweigh anti competitive effects, it is necessary to verify what the link between the agreement and the claimed efficiencies and what the value of these efficiencies are. The Commission did not dispute that payment card schemes such as Mastercards may represent, as such, economic and technical progress. However, it considered that the decisive question was whether the Mastercard MIF specifically contributed to that progress (at recital 679). In addressing Mastercards balancing of demand arguments the Commission referred to the assumption underlying the Mastercard MIF that there was a perceived imbalance between the issuing and the acquiring business in the scheme. The Commission observed (at recital 686): Also, an imbalance between issuing and acquiring cannot be assumed on the basis of cost considerations only but has to comprise an analysis of revenues as well. A cost imbalance is as such no sufficient evidence to explain why MasterCards MIF is always paid by the acquirer to the issuer, irrespective of the concrete market situation. If receipts (interests, money exchange fees, penalty fees, etc) or other monetary benefits (resulting from cost savings such as reduction of staff, paperwork etc) from payment card issuing provide sufficient commercial incentives for banks to invest in incremental card issuing, a transfer from acquiring to issuing may be superfluous and even counterproductive as the revenue transfer dampens card acceptance due to the increase of costs on the merchants side. Robust empirical evidence is therefore required to establish the necessity for and the direction of a fallback interchange fee. (Original emphasis) (See also recital 720) Similarly, in a section of the decision headed Need for empirical evidence No excessive burden of proof on MasterCard, the Commission explained (at recital 694) that Mastercard erred in its assertion that the Commission imposed an excessively high burden of proof on Mastercard if it required Mastercard to demonstrate empirically a causal link between the MIF and the actual effects on system output as well as the objective efficiencies that could result from increased system output. It continued (at recital 695): It is on the undertakings in the first place to present to the Commission the evidence intended to establish that the agreement in question fulfils the conditions laid down by [article 101(3)] of the Treaty. In the context of the first condition it has to be ascertained that the restrictive effects are offset by efficiencies. In this context the undertakings concerned must demonstrate whether a MIF generates the positive effects which the underlying model claims to achieve, here: an increase of system output and possible related efficiencies. To the extent that objective efficiencies cannot be established empirically, they cannot be balanced with the restrictive effects. Some form of convincing empirical evidence on the actual effect of a MIF on the market is therefore required. A footnote to the third sentence of recital 695 (footnote 840) reads: Again, it should be noted that an increase in system output does not constitute an objective efficiency if the benefits of increased card usage only accrue to banks, while customers and merchants are worse off due to higher retail prices and increased merchant fees. Hence, evoking the maximisation of system output also requires a convincing analysis that consumers benefit from this. On behalf of Visa and Mastercard it is submitted that these passages must be read in the context that the Commission was responding to the very different evidence put forward by Mastercard in that case, namely the Baxter framework, a different, older and less sophisticated economic theory which had been superseded by the work of Rochet and Tirole (discussed further in para 132 below). However, the Commissions statements at recitals 686 and 695 are general statements made before consideration of the Baxter framework which is introduced at recital 703. It is immediately preceded by the statement (at recital 702) that notwithstanding the lack of evidence to bolster Mastercards efficiency claim, the Commission has also assessed the theoretic underpinnings of Mastercards MIF. Similarly, the schemes are not assisted by their reliance on the following passage at recital 731 of the Mastercard Commission Decision which, they maintain, describes the Commissions approach: Contrary to MasterCards perception the Commissions position is not that only the level of a MIF is a decisive criterion for assessing whether that MIF fulfils the first condition of [article 101(3)] of the Treaty. Rather, the existence of objective appreciable efficiencies is assessed in relation to the MIF as such, the effects it produces on the market and the manner in which it is set. In particular, the Commission verifies on the basis of the evidence submitted whether the model underlying a MIF is based on realistic assumptions (which is not the case here), whether the methodology used to implement that model in practice is objective and reasonable (which is not the case for the two methodologies used by MasterCard) and whether the MIF indeed has the positive effect on the market to the benefit of both customer groups which the model claims. The Commission was not subscribing here to the view that convincing proof of efficiencies can be provided by economic modelling and assumptions alone. On the contrary, the Commission made abundantly clear the need for empirical evidence in the immediately preceding recital: There is no presumption that MIFs in general enhance the efficiency of card schemes just as there is no presumption that they do not fulfil the conditions of [article 101(3)] of the Treaty and are therefore illegal. A MIF may be used by banks to achieve efficiencies as well as to extract rents. The Commissions conclusion on the efficiencies of a MIF will depend on the concrete evidence brought forward by the parties. (recital 730) and the immediately following recital: Any claim that a MIF creates efficiencies within the meaning of [article 101(3)] of the Treaty must therefore be founded on a detailed, robust and compelling analysis that relies in its assumptions and deductions on empirical data and facts. MasterCard has not provided such analysis and empirical evidence, (recital 732) The appeal against the Commission decision was dismissed by the General Court in Mastercard GC. In those proceedings, Mastercard had complained that an excessively high burden of proof had been imposed on the applicants in relation to the conditions of what is now article 101(3) TFEU, whereas the Commission had been required to analyse the arguments and the evidence adduced by reference to the balance of probabilities alone (paras 194, 195 and 237). In rejecting this submission, the General Court observed (at para 196) that a person who relies on [article 101(3)] must demonstrate that those conditions are satisfied, by means of convincing arguments and evidence. At a later point in the judgment the General Court observed: 232. So far as concerns the allegation relating to the lack of data capable of meeting the standard of economic proof demanded by the Commission, even if that were established, it does not mean that the burden of proof is eased, or even reversed, as the applicants seem to suggest. It must be observed that such a difficulty might be regarded as having resulted from the arguments developed by the applicants during the administrative procedure. 233. Thus, inasmuch as it is not possible to establish precisely the extent of the advantages that can be deemed to justify some financial compensation from merchants for the costs incurred by issuing banks, it is reasonable to conclude that it was for the applicants in order to prove that the MIF satisfied the first condition laid down in [article 101(3), TFEU] to identify the services provided by the banks issuing debit, charge or credit cards capable of constituting objective advantages for merchants. It was also for them to establish that there was a sufficiently clear correlation between the costs involved in the provision of those services and the level of the MIF. As regards the last point, it must be noted that those costs cannot be determined without taking into account other revenues obtained by issuing banks on the provision of those services or by including costs which are not directly linked to them. This is entirely consistent with and supports our view that, in identifying what evidence may be required to discharge the burden on an undertaking claiming exemption under article 101(3), the Commission and the EU courts are not adjusting the standard of proof. The decision of the General Court in Mastercard GC was upheld by the Court of Justice in Mastercard CJ. Before the Court of Justice, a plea contending that the General Court had failed to apply the correct standard of proof, ie the balance of probabilities, was held inadmissible. (See Advocate General Mengozzi at paras 136 149, Mastercard CJ at paras 209 219.) It is noteworthy that both the General Court and the Court of Justice placed reliance on the authority of GlaxoSmithKline. The Court of Justice stated: 235. Next, the court notes that the examination of an agreement for the purposes of determining whether it contributes to the improvement of the production or distribution of goods or to the promotion of technical or economic progress, and whether that agreement generates appreciable objective advantages, must be undertaken in the light of the factual arguments and evidence provided by the undertakings (see to that effect, in connection with a request for exemption under article 81(3) EC, judgment in GlaxoSmithKline Services Unlimited v Commission of the European Communities (C 501/06 P, C 513/06 P, C 515/06 P and C 519/06 P) EU:C:2009:610, para 102). 236. Such an examination may require the nature and specific features of the sector concerned by the agreement in question to be taken into account if its nature and those specific features are decisive for the outcome of the analysis (see judgment in GlaxoSmithKline Services, EU:C:2009:610, para 103). In their written cases, Visa and Mastercard submit that there is no EU law that concerns the nature of the evidence required before national courts in order to satisfy the four conditions under article 101(3). In their submission, the EU has, by legislation, expressly deferred procedural autonomy to member states, not just in respect of the legal test for the standard of proof, but also in relation to the nature of evidence required to satisfy that domestic standard, subject only to the EU principles of equivalence and effectiveness. In our view, this submission is contradicted by authority and is simply wrong. While EU law has deferred to the law of member states in respect of the standard of proof under article 101(3), subject to the principles of equivalence and effectiveness, it clearly maintains its own requirements as to the type of evidence which may be capable of discharging the appropriate standard of proof. Moreover, those requirements cannot vary depending on whether EU competition law is being applied by EU courts or authorities or the courts or authorities of member states. As the Court of Appeal observed in the present case (at para 81), it is important to maintain a consistency of approach across member states as to the requirements of article 101(3). It should be noted, in this regard, that the Modernisation Regulation emphasises the importance of the effective and uniform application of competition law within the EU. (See recitals 1, 14, 17, 19, 21 and 22 and article 16.) In the same way, national courts are required by section 60(2) of the 1998 Act to ensure consistency in the application of article 101 with that of the General Court and the Court of Justice. In our view, EU law clearly requires an undertaking seeking exemption under article 101(3) to produce cogent empirical evidence in support of that claim. Visa submits that, while in some cases it may be difficult to prove that a causal link is real without specific empirical evidence and data, it will depend on the particular circumstances of the case. In the present case, Visa submits, a judge would be entitled to conclude that nothing more is required than the expert evidence of economists to prove that an issuing bank which receives a payment on each card transaction undertaken by its customers will probably invest more to encourage its customers to engage in a greater number of such card transactions than it would do if it did not receive any such payments. This submission, however, grossly underestimates the complexity and subtlety of the balancing exercise required under article 101(3). In particular, as the AAM parties point out, an assessment of any benefits accruing to consumers and merchants from MIFs will depend on a range of factors including issuer pass through (the extent to which issuing banks decide to recycle MIF revenues into promotional behaviour) and always card transactions (the extent to which cardholders alter their behaviour in the light of any incentives provided). Thus, in the present case the Court of Appeal correctly concluded (at para 88) that establishing the requisite causal link involves two critical stages: first that the default MIFs in each case incentivise the issuers to take steps they would not otherwise have taken, and secondly that the steps taken did indeed increase card usage or increase the efficiencies of transactions which would have been card transactions anyway. (See also the judgment of Popplewell J at para 310 and the Visa exemption judgment of Phillips J at para 37.) Such factors must necessarily be taken into account in assessing whether appreciable objective advantages for consumers arise from the restriction in question so as to compensate for its competitive disadvantages. This process necessarily requires empirical evidence. A further demonstration of the need for empirical evidence is provided by the General Court in Mastercard GC (at para 233) where it calls, inter alia, for a comparison between the cost of providing services from which merchants are said to benefit as a result of the MIF and the level of the MIF itself: Thus, inasmuch as it is not possible to establish precisely the extent of the advantages that can be deemed to justify some financial compensation from merchants for the costs incurred by issuing banks, it is reasonable to conclude that it was for the applicants in order to prove that the MIF satisfied the first condition laid down in [article 101(3)] to identify the services provided by the banks issuing debit, charge or credit cards capable of constituting objective advantages for merchants. It was also for them to establish that there was a sufficiently clear correlation between the costs involved in the provision of those services and the level of the MIF. As regards the last point, it must be noted that those costs cannot be determined without taking into account other revenues obtained by issuing banks on the provision of those services or by including costs which are not directly linked to them. Visa complains that the approach adopted by the Court of Appeal in this case is inconsistent with the object and purpose of the relevant legislation in that article 101 and the Chapter I prohibition under the 1998 Act apply to agreements between undertakings, or decisions of associations of undertakings, from the date that they are made and before they have been implemented and had any effect at all. As a result, it is submitted, the prohibition applies before empirical, real world evidence of the type demanded by the Court of Appeal can be available. Undertakings, it is said, must be able to make a realistic assessment, at the time of making their agreement, as to whether article 101(3) is satisfied or not and that can only be done with the best evidence that is reasonably available at the time. In our view, there is nothing in the Court of Appeals approach which is inconsistent with the object and purpose of the legislation. Indeed, the answers advanced by the AAM parties are, in our view, compelling. First, the Guidelines state (at para 58) that, in cases where an agreement has yet to be fully implemented, the parties must substantiate any projections as to the date from which the efficiencies will become operational so as to have a significant positive impact in the market. (See also the General Court in GlaxoSmithKline at para 249.) Secondly, it is not the case that where, as in the present case, there is experience of restrictive measures over many years, the courts must disregard the evidence then available to them in assessing the issue of exemption. Thus, in Krka Tovarna Zdravil d d v European Commission (Case T 684/14) [2019] 4 CMLR 14, the General Court (Ninth Chamber) observed (at para 360), with regard to the assessment of distortion of competition under article 101(1) by comparison with the situation which would have existed but for the agreement: It appears paradoxical where the clauses of an agreement have been implemented and their impact on competition can be measured by taking into account the relevant factual developments, including those subsequent to the conclusion of the agreement, which took place before the Commission issued its decision to allow the Commission to demonstrate merely the anticompetitive effects that such clauses are likely to have and, to that end, to make the comparison without taking those developments into account. Finally, in this regard, it is necessary to say something about the reliance placed by Visa and Mastercard on the merchant indifference test (MIT). The MIT, which is also known as the tourist test, is an economic methodology developed by Professors Rochet and Tirole, initially in a paper published in 2008. It embodies the notion that there is a level of MIF which, when included in the MSCs paid by merchants, equalises the cost to merchants of accepting a scheme card with the cost of their accepting other methods of payment such as cash. If the MIT is set at that level, a merchant would be indifferent as to whether a one off customer (such as a tourist) chooses to pay with cash or card, so long as he does not choose to shop elsewhere. If, however, it is set at a higher level, while a merchant could in principle be better off by refusing to accept scheme cards because other forms of payment would be cheaper, in reality, if he did so, he would probably lose sales to rivals who did accept them (the business stealing effect). There are must take cards that merchants cannot turn down. The MIT seeks to put an upper limit on MIFs so that the schemes are not able to exploit their market power over merchants in this way (Rochet and Tirole, Must Take Cards: Merchant Discounts and Avoided Costs, (2011) Journal of the European Economic Association 9(3): 462 at 463). Visa and Mastercard rely on the MIT in two ways. First, they submit that in the EU Interchange Fee Regulation 2015 (Regulation (EU) 2015/751 of the European Parliament and of the Council on Interchange Fees for Card based Payment Transactions (OJ 2015 L123, p 1)) (the IFR) the EU legislature has endorsed the MIT test as meeting the requirements of article 101(3). This is not correct. While the Commission and the European Parliament accepted the MIT for the purpose of setting a cap under the Regulation, the Commission has consistently maintained that adoption of the MIT alone will not lead to automatic exemption. This is reflected in recital 10 of the IFR: In addition to a consistent application of the competition rules to interchange fees, regulating such fees would improve the functioning of the internal market and contribute to reducing transaction costs for consumers. and in recital 14: The application of this Regulation should be without prejudice to the application of Union and national competition rules. It should not prevent member states from maintaining or introducing lower caps or measures of equivalent object or effect through national legislation. In enacting the IFR, the Commission and the European Parliament were concerned with regulation and were not specifically addressing issues of EU competition law. Secondly, Visa and Mastercard submit that the Commission has repeatedly taken into account a variety of forms of available evidence, including economic theory and in particular the MIT, when examining MIFs. In this regard, they rely in particular on a number of commitment decisions made under article 9 of the Modernisation Regulation. It is undoubtedly correct that the Commission has in these decisions had regard to the MIT as a proxy or a benchmark. However, it is important to bear in mind that these decisions are not instances of the application of article 101(3) but pragmatic means employed by the Commission to compromise outstanding investigations in return for commitments. As Mr Khan explained on behalf of the Commission, whereas an infringement decision adopted pursuant to article 7 of the Modernisation Regulation would have to include an assessment of any claim by the addressee that the agreement in issue qualified for an article 101(3) exemption, a commitment decision pursuant to article 9 does not include such an assessment. The essence of a commitment decision is that the Commission does not take a position on the existence of an infringement of article 101(1) TFEU, the approach being based on procedural economy. Moreover, the Commission has made clear that a MIF which satisfies the MIT will not automatically be considered compliant with what is now article 101(3). Thus, in its Memorandum of 1 April 2009 (Memo/09/143), at the time of accepting undertakings from Mastercard, it accepted that the MIT provides a reasonable benchmark for assessing a MIF level that generates benefits to merchants and final consumers. However, it went on to point out that the general applicability of the test for the purposes of what is now article 101(3) depends on the specifics of the markets at hand. Having listed some cautionary examples, it emphasised that where a MIF is restrictive, the parties to the agreement must demonstrate that the conditions under article 101(3) are met. It continued: In this respect, there is a need to ascertain that the concrete model underlying a MIF is based on realistic assumptions, that the model is plausibly implemented through an objectively verifiable methodology and that the MIF indeed yields the objective efficiencies on the market which are claimed by the parties. The methodology underlying a MIF should be transparent to the final users of a scheme. However, if a card scheme wishes to pre determine the fees merchants pay through a MIF, it must be aware that the burden of proof to demonstrate the fulfilment of the four conditions under [article 101(3)] lies upon the scheme and its members. (at pp 6 7) There is a further and more fundamental reason why the MIT does not assist Visa and Mastercard on the present issue. It is not designed as a substitute for the balancing test as a means of establishing efficiencies and benefits under article 101(3). It is, rather, designed to meet the specific concern that merchants may be vulnerable because they are typically in a poor position to resist consumers who want them to accept cards in exchange for goods or services. As a result, the MIT seeks to ensure that the collective interchange fees do not rise above a level at which payment by card is more expensive for merchants than other methods of payment. In a situation where a MIF satisfies the MIT and where the issuing bank recycles all of its MIF income to cardholders, there should be no net detriment to cardholders and merchants considered together. If, on the other hand, as in the present case, the issuer pass through is less than 100% (ie the issuer retains a part of the MIF), there is likely to be a net loss to cardholders and merchants considered together. A net benefit could still arise in these circumstances, however, if the MIF revenue passed to cardholders caused them to make greater use of their cards, so that merchants were relieved of a sufficiently large number of transactions using a more expensive form of payment, with the result that the loss to cardholders and merchants considered together from reduced issuer pass through was outweighed. Whether this in fact occurs will depend on the extent of issuer pass through, the extent of always card transactions and the difference in cost for merchants between accepting a scheme card and an alternative form of payment. As Mr Jon Turner QC put it on behalf of the AAM parties, the theory of the MIT does not even purport to avoid the need to address such issues, which would be essential if an appropriate balancing exercise under article 101(3) were to be carried out. These are highly relevant matters that can be brought into account only on the basis of empirical evidence. In the present case, the Commission intervened before the Court of Appeal and explained why Visa and Mastercard were wrong to suggest that the MIT had been treated by it as an appropriate basis for assessing the issue of exemption. We agree with the conclusion of the Court of Appeal (at para 109), accepting the submissions of the Commission, that the Commission regards the MIT as a useful starting point but not as a substitute for the facts of the case. It is not a silver bullet for Visa and Mastercard. In order to obtain exemption, they still have to back up any reliance on the MIT as a benchmark with robust analysis and cogent empirical evidence. Conclusion on the standard of proof issue For these reasons we dismiss the appeal on issue (ii). Issue (iii) The fair share issue The third issue in the appeal is raised by Visa. It concerns the interpretation of article 101(3) TFEU, under which an agreement, decision or concerted practice which is restrictive of competition is exempted from the prohibition imposed by article 101(1) provided it satisfies certain conditions. The terms of article 101(3) have been set out at para 19 above. As described at para 107 above, four conditions must be met before an exemption can be granted. It is the second of those conditions which is here in issue, namely that consumers must receive a fair share of the benefits resulting from the restriction of competition. The context in which that condition has to be considered in the present case includes the fact, explained in paras 15 16 above, that the Visa and Mastercard schemes operate in a two sided market. On one side of the market, issuers compete with each other for the business of customers to whom they will issue cards (the issuing market). The cardholders are the consumers in the issuing market. On the other side of the market, acquirers compete with each other for the business of merchants to whom they seek to offer acquiring services (the acquiring market). Merchants are the consumers in the acquiring market. As has been explained, MIFs restrict competition in the acquiring market. They do not restrict competition in the issuing market. The judgments at first instance At first instance, Phillips J concluded in the Visa restriction judgment (wrongly, as we have held) that the MIFs did not infringe article 101(1), but went on in the Visa exemption judgment to consider whether, if that was incorrect, the MIFs would have qualified for exemption under article 101(3). He concluded that they would not. That was because, in his opinion, they did not meet the first condition for exemption under article 101(3): it had not been proved that they produced any benefits. He nonetheless went on to consider the second condition at paras 53 64 of the Visa exemption judgment. He accepted Visas argument, based on its analysis of the judgment in Mastercard CJ, particularly at paras 240 243 and 247, that for the purpose of deciding whether consumers received a fair share of the resulting benefits, it was necessary in the context of a two sided market to consider the position of consumers in both markets as a whole. Benefits accruing to cardholders as a result of MIFs could therefore be taken into account in determining whether the benefits at least equalled the disadvantages. He considered that there must, however, be at least some objective advantages for merchants, even if they were less than the burden they suffered. On that interpretation, the second condition could be satisfied even if merchants were worse off as a result of MIFs, provided they received some objective advantages, and the benefits to cardholders and merchants, considered in aggregate, outweighed the disadvantages. However, given his finding that no benefits were generated by MIFs, it followed that that requirement was not met. Phillips Js analysis differed in important respects from that adopted by Popplewell J in the AAM proceedings. Like Phillips J, he considered that the MIFs were not prohibited by article 101(1), but went on to consider whether, if that was incorrect, they would qualify for exemption under article 101(3). He concluded that they would, applying what we have held to be an incorrect approach to the standard of proof. In relation to the first condition, he accepted at para 278 that, in a two sided market such as the Mastercard scheme, the relevant consumers included cardholders as well as merchants, and that the relevant benefits were not, therefore, confined to those arising on the acquiring market. When it came to the second condition, however, since merchants were the consumers who were adversely affected by the restriction of competition caused by MIFs, he concluded at paras 280 287 that the fair share requirement would not be met unless, as a minimum, they obtained benefits from MIFs which matched the anti competitive disadvantages which MIFs imposed on them. In addition, he considered that the MIFs must not generate unduly high profits for issuers: para 287. On the facts, he concluded at para 409 that those requirements were met, again applying a standard of proof which we have held to be mistaken. In the CAT proceedings, it was found on the evidence that Mastercards MIFs infringed article 101(1) and did not result in any benefits. Accordingly, the first condition under article 101(3) was not met, and the question whether consumers received a fair share of any benefits did not arise. The judgment of the Court of Appeal Before the Court of Appeal, Sainsburys challenged Phillips Js interpretation of the second condition, while Visa maintained that it was correct. Popplewell Js analysis was not challenged. The court carefully considered the relevant sections of Mastercard GC and Mastercard CJ at paras 96 104 of its judgment. It interpreted paras 240 243 and 247 of Mastercard CJ, in particular, as meaning that in applying both the first and the second conditions in a situation where the restriction affects two markets, if the restriction causes disadvantages overall to the consumers in the market under consideration (here the merchants in the acquiring market), those disadvantages cannot be compensated by advantages to consumers in the other market (here the cardholders in the issuing market), unless the two groups of consumers are substantially the same; which is not the position in this case. In the Court of Appeals view, the consumers in the relevant market, here the merchants, would only receive a fair share of the benefits if the advantages to them caused by the restriction outweighed the disadvantages, so that they were no worse off. The Court of Appeal therefore concluded that Popplewell Js analysis of the law was correct, and Phillips Js was wrong. The parties arguments on the present appeal In its appeal to this court, Visa challenges the decision of the Court of Appeal and argues that Phillips Js analysis of the second condition was correct. As will be explained in greater detail, it maintains, in particular, that the issue was considered and decided, in the manner for which it contends, in Mastercard CJ, particularly at paras 241 and 247. All parties agree that the question as to how the second condition should be applied in the context of two sided markets is a question of EU law, which has to be answered by considering the relevant jurisprudence of the CJEU. The Mastercard Commission Decision It is best to begin by considering the Mastercard Commission Decision, which was the subject matter of the judgments of the General Court and the Court of Justice in Mastercard GC and Mastercard CJ respectively. The Commission concluded at recital 733 that the Mastercard MIFs did not meet the first condition of article 81(3) of the EC Treaty (now article 101(3) TFEU). When it went on to consider the second condition, it stated at recitals 740 to 742: 740. There is no reason to assume from the outset that an interchange fee paid by acquirers to issuers increases the utility of the payment card system to [both] groups of consumers alike. The Commission does not dispute that merchants may benefit through enhanced network effects from the issuing side, but this does not necessarily offset their losses which result from paying inflated merchant fees. In setting a MIF the member banks of a card scheme must guarantee a fair share of the benefits to [all] customers, not only to those that are on the side of the scheme which receives the MIF. In a scheme where the MIF is paid by the acquirer to the issuer, the efficiencies must in particular counterbalance the restrictive effects to the detriment of merchants (and subsequent purchasers). MasterCard has not submitted evidence in this respect. 741. The Commission has therefore reviewed the methodologies which MasterCard uses as starting point for setting the level of the Intra EEA fallback interchange fees. It can be left open in this case whether cardholders sufficiently benefit from MasterCards MIF. The Commissions concerns under the second condition of article 81(3) of the Treaty in this decision relate to the customer group which bears the cost of the MIF, that is the merchants. 742. While merchants may benefit through enhanced network effects from the issuing side, this does not necessarily offset their losses which result from paying inflated merchant fees. (Emphasis added) The Commission concluded at recital 743 that without further evidence which Mastercard failed to submit it cannot safely be assumed that Mastercard is creating objective efficiencies that benefit all customers, including those that bear the cost of its MIF (merchants and subsequent purchasers) (emphasis in original). It is apparent from the foregoing, and perhaps especially from the passages which we have italicised in recitals 740 and 742, that the Commission proceeded on the basis that, in order for the second condition to be satisfied, it was necessary that the consumers who suffered the losses resulting from the restrictive agreement that is to say, the merchants must have those losses offset or counterbalanced by benefits enjoyed by themselves. The Guidelines That approach was consistent with the Guidelines. Under the heading of General principles, they state at para 43: [T]he condition that consumers (55) must receive a fair share of the benefits implies in general that efficiencies generated by the restrictive agreement within a relevant market must be sufficient to outweigh the anti competitive effects produced by the agreement within that same relevant market (56). Negative effects on consumers in one geographic market or product market cannot normally be balanced against and compensated by positive effects for consumers in another unrelated geographic market or product market. However, where two markets are related, efficiencies achieved on separate markets can be taken into account provided that the group of consumers affected by the restriction and benefiting from the efficiency gains are substantially the same (57). (Emphasis added) That analysis also underpins the discussion of the second condition in paras 85 86 of the Guidelines. The case law on which para 43 is based is cited in the footnotes. Footnote 56 refers to the judgment of the Court of First Instance in Shaw v Commission of the European Communities (Case T 131/99) [2002] ECR II 2023, para 163, where the court observed that the assessment of countervailing benefits under article 81(3) EC had to be made within the same analytical framework as that used for assessing the restrictive effects. Footnote 57 refers to the judgment of the Court of First Instance in Compagnie Gnrale Maritime v Commission of the European Communities (Case T 86/95) [2002] ECR II 1011. The case concerned a price fixing agreement relating to inland transport services provided to shippers by maritime carriers as part of intermodal transport. The alleged benefits relied on by the parties to the agreement related to maritime transport services provided to shippers by the same companies. The court stated at para 343: For the purposes of examining the merits of the Commissions findings as to the various requirements of article 85(3) of the [EEC] Treaty and article 5 of Regulation 1017/68 [which applied competition rules to the transport sector], regard should naturally be had to the advantages arising from the agreement in question, not only for the relevant market, namely that for inland transport services provided as part of intermodal transport, but also, in appropriate cases, for every other market on which the agreement in question might have beneficial effects, and even, in a more general sense, for any service the quality or efficiency of which might be improved by the existence of that agreement. Both article 5 of Regulation 1017/68 and article 85(3) of the Treaty envisage exemption in favour of, amongst others, agreements which contribute to promoting technical or economic progress, without requiring a specific link with the relevant market. That passage is expressed in wide terms. However, the last sentence is plainly concerned with the first condition of article 85(3) EEC (equivalent to article 81(3) EC and article 101(3) TFEU), and the passage as a whole responds to a criticism of the Commissions approach to the first condition: see para 305 of the judgment. In addition, on the facts of the case, the consumers in both markets were substantially the same. In those circumstances, it would be unsurprising if the benefits accruing to the same consumers in both markets were aggregated for the purpose of assessing compliance with article 85(3). The Court of First Instance subsequently made a similar observation in GlaxoSmithKline at para 248, again in the context of a challenge to the Commissions application of the first condition. The Guidelines are not legally authoritative, but they form an important element of the decentralised system for the enforcement of competition law established by the Modernisation Regulation. National authorities and courts are expected to take due account of them in accordance with their duty of sincere cooperation: see the Opinion of Advocate General Kokott in Expedia Inc v Autorit de la concurrence (Case C 226/11) EU:C:2012:544, points 37 38. Mastercard GC When the Mastercard Commission Decision was challenged before the General Court, it was argued, in relation to the first condition in article 81(3) EC, that the Commission had failed to take into account the positive effects of the MIFs on the issuing market. In response, the General Court stated at paras 228 229: 228. [I]t is indeed settled case law that the appreciable objective advantages to which the first condition of article 81(3) EC relates may arise not only for the relevant market but also for every other market on which the agreement in question might have beneficial effects, and even, in a more general sense, for any service the quality or efficiency of which might be improved by the existence of that agreement (Compagnie Gnrale Maritime v Commission of the European Communities (T 86/95) [2002] ECR II 1011 at para 343, and GlaxoSmithKlineServices (T 168/01) [2006] ECR II 2969 at para 248). However, as merchants constitute one of the two groups of users affected by payment cards, the very existence of the second condition of article 81(3) EC necessarily means that the existence of appreciable objective advantages attributable to the MIF must also be established in regard to them. 229. Therefore, in the absence of such proof, the applicants criticism that insufficient account was taken of the advantages of the MIF for cardholders is, in all events, ineffective. It appears from the last sentence of para 228 that the General Court considered that it was essential, in order to satisfy the second condition of article 81(3), to prove that merchants benefited from appreciable objective advantages which were attributable specifically to the MIFs. The court seemingly inferred that the advantages with which the first condition was concerned must, therefore, include appreciable objective advantages for merchants. In the absence of proof of such advantages, the criticism that the Commission had taken insufficient account of the advantages for cardholders went nowhere, as the court indicated at para 229. The General Court went on to state at para 233 that it was for the applicants (Mastercard and other financial institutions), in order to prove that the MIF satisfied the first condition, to identify the services which were capable of constituting objective advantages for merchants, and that there was a clear correlation between the costs involved in the provision of those services and the level of the MIF. Since that had not been done, it followed that the challenge to the Commissions reasoning in relation to the first condition must be rejected: para 236. Since the first condition was not satisfied, there was no need to examine the other aspects of the Commissions analysis: ibid. Mastercard CJ On further appeal to the Court of Justice, it was argued that the General Court had erred in focusing on the benefits to merchants, despite recognising in para 228 that advantages could be taken into account for any market that benefited from the existence of the agreement in question. The General Court had thus wrongly ignored, it was argued, the significant advantages which the Mastercard system and the MIF were said to bring about for cardholders. That argument, so far as it bore on the second condition, was considered in the Opinion of Advocate General Mengozzi. He identified the question of law arising from the argument in relation to the second condition: AG154. The point of law underlying that complaint is therefore whether, in order for the exemption provided for in article 81(3) EC to be applicable in such a context, it is necessary that the fair share of the profit resulting from the advantages arising from the agreement, as provided for in article 81(3) EC, be reserved for the direct consumers of the services provided on the market on which the restrictive effects for competition are produced in this case, in particular, merchants or whether it can be considered that the restrictive effects harming those consumers may be compensated by the advantages produced for consumers of the services provided on a related market, namely, in this case, cardholders. The Advocate Generals answer to that question was that the restrictive effects harming merchants could not be compensated by the advantages produced for cardholders: in order to satisfy the second condition, merchants themselves must receive a fair share of the benefits resulting from the restrictive agreement. He began his reasoning on this point by making some general points about the second condition: AG155. It should be borne in mind, as a preliminary point, that the second condition in article 81(3) EC requires that, in order for a restrictive agreement to benefit from the exemption provided for in that provision, consumers must be allowed a fair share of the resulting benefits. AG156. In that regard, it should be observed, first, that the consumers referred to in that provision must be considered to be the direct or indirect consumers of the goods or services covered by the agreement. Secondly, it is apparent from consistent case law that, in order for an agreement restrictive of competition to be capable of being exempted under article 81(3) EC, the appreciable objective advantages created by that agreement must be of such a character as to compensate for the disadvantages which they cause for competition. It may be inferred from that case law that, in order for a restrictive agreement to be able to benefit from the exemption, the advantages resulting from that agreement must ensure that consumers are compensated in full for the actual or probable adverse effects that they must bear owing to the restriction of competition resulting from the agreement. In other words, the benefits arising from the restrictive agreement must counterbalance its negative effects. (Emphasis added) It followed from the points which we have italicised that, in order for the second condition to be satisfied, the disadvantages suffered by consumers in the market where competition was restricted must be counterbalanced by advantages benefiting the same consumers, as the Advocate General went on to explain: AG157. To my mind, however, that compensation must apply to consumers who are directly or indirectly affected by the agreement. It is the consumers that suffer the harm caused by the restrictive effects of the agreement at issue that must, in principle, be allowed, as compensation for that harm, the fair share of the benefit resulting from the agreement referred to in article 81(3) EC. Furthermore, as the Advocate General explained, the contrary view would result in competition authorities favouring one category of consumers at the expense of others, something which was no part of the function of competition law: AG158. In fact, if it were possible to take into consideration the advantages resulting from an agreement for one category of consumers of certain services in order to counterbalance the negative effects on another category of consumers of other services on a different market, that would amount to allowing the former category of consumers to be favoured to the detriment of the latter category. However, distributive logic of that type seem[s] to me, in principle, to have no connection with the practical scope of competition law. Competition law is intended to protect the structure of the market, and thus competition, in the interest of competitors and, ultimately, consumers in general. Conversely, it is not intended to favour one category of consumers to the detriment of a different category. (Emphasis in original) In its judgment, the Court of Justice noted at para 208 that the General Court had rejected the submission that the Commission had erred in applying the first condition of article 81(3) EC, rendering further analysis unnecessary. The Court of Justice then focused in its own judgment on the first condition rather than the second. It characterised the challenge to the reasoning of the General Court at para 228 as raising in essence the question as to which markets may be regarded as generating the objective advantages that may be taken into account for the purposes of the analysis of the first condition. In the course of its discussion of whether the first condition was met, the court explained at para 234 that the improvement, within the meaning of the first condition laid down in article 81(3) EC must in particular display appreciable objective advantages of such a character as to compensate for the disadvantages which that agreement entails for competition. It added at para 237 that, in the case of a two sided system such as the Mastercard scheme, in order to assess whether the first condition was met, it was necessary to take into account, where appropriate, all the objective advantages flowing from the restrictive measure in both markets, and to assess whether the advantages were of such a character as to compensate for the disadvantages which the measure entailed for competition. The court then stated at paras 240 and 241: 240. In particular, as regards the argument that the General Court did not take into account the advantages flowing from the MIF for cardholders, it must be held that the General Court was, in principle, required, when examining the first condition laid down in article 81(3) EC, to take into account all the objective advantages flowing from the MIF, not only on the relevant market, namely the acquiring market, but also on the separate but connected issuing market. 241. It follows from this that, should the General Court have found that there were appreciable objective advantages flowing from the MIF for merchants, even if those advantages did not in themselves prove sufficient to compensate for the restrictive effects identified pursuant to article 81(1) EC, all the advantages on both consumer markets in the MasterCard scheme, including therefore on the cardholders market, could, if necessary, have justified the MIF if, taken together, those advantages were of such a character as to compensate for the restrictive effects of those fees. In the present appeal, Visa relies on para 241, which it describes as crucial to its argument. That paragraph is, however, concerned with the first condition of article 81(3), not the second. It is also qualified by the proviso contained in its final words: if, taken together, those advantages were of such a character as to compensate for the restrictive effect of those fees. That proviso was not satisfied in the case before the Court of Justice, as it explained in para 242: However, as is recalled in para 234 of the present judgment, examination of the first condition laid down in article 81(3) EC raises the question whether the advantages derived from the measure at issue are of such a character as to compensate for the disadvantages resulting therefrom. Thus, where, as in the present case, restrictive effects have been found on only one market of a two sided system, the advantages flowing from the restrictive measure on a separate but connected market also associated with that system cannot, in themselves, be of such a character as to compensate for the disadvantages resulting from that measure in the absence of any proof of the existence of appreciable objective advantages attributable to that measure in the relevant market, in particular, as is apparent from paras 21 and 168 to 180 of the judgment under appeal, where the consumers on those markets are not substantially the same. (Emphasis added) The passage which we have italicised makes it clear that in a situation where the disadvantages resulting from a restriction of competition are felt on only one side of a two sided market which is the position in this case then the advantages on the other market cannot be taken into account for the purposes of the first condition of article 81(3) EC (or article 101(3) TFEU), in the absence of particular circumstances justifying such a course (as where the consumers in both markets are substantially the same), unless it has been proved that the restrictive measure also causes appreciable objective advantages in the market where the restrictive effects are felt. Since no such advantages had been proved in the case before the court, it followed that the first condition was not satisfied. That was confirmed by the court in para 243: In the present case, and without any distortion having been claimed in that regard, the General Court concluded in para 226 of the judgment under appeal that there was no proof of the existence of objective advantages flowing from the MIF and enjoyed by merchants. In those circumstances, it was not necessary to examine the advantages flowing from the MIF for cardholders, since they cannot, by themselves, be of such a character as to compensate for the disadvantages resulting from those fees. The General Court was therefore fully entitled to find, in para 229 of the judgment under appeal, that the [appellants] criticism that insufficient account was taken of the advantages of the MIF for cardholders is, in all events, ineffective. The court went on to state in para 247, in the other passage relied on by Visa in the present appeal: As regards the appellants argument that the General Court did not explain why the first two conditions in article 81(3) EC could not be satisfied on the basis only of the advantages the MIF produce for cardholders, it is sufficient to refer to paras 240 to 245 of the present judgment. Visa submits that, in that paragraph, the court clarified that the analysis in paras 241 243 of its judgment, which had been expressed by reference to the first condition, also applied to the second. In our opinion, there is no warrant for that interpretation of para 247. The court had previously explained in paras 240 245 why the challenge to the General Courts conclusion in respect of the first condition was rejected. The court had not said anything about the second condition. The way in which the fair share requirement should be applied in a situation where the restrictive effects were felt on only one side of a two sided market had not received any consideration. All that the court said in substance, in para 247, was that it had already explained, in its discussion of the first condition, why the first two conditions could not be satisfied on the basis only of the advantages which the MIF produced for cardholders. As the court had already noted at para 208, where it cited para 236 of the judgment of the General Court, where the first condition was not satisfied, there was no need to examine the other aspects of article 81(3). If Visas argument were correct, the Court of Justice would effectively have treated the first and second conditions of article 81(3) as interchangeable: both could be satisfied by the same aggregation of the benefits on both sides of a two sided market, and the second condition would add nothing to the first. They are, however, essentially different. The second condition adds a distinct requirement of fairness to the considerations of economic efficiency with which the first condition is primarily concerned. Consideration of aggregate efficiency gains across different markets may well be relevant to the first condition, in situations where restrictive measures have effects in more than one market, but they cannot ordinarily be determinative of the question, under the second condition, whether a fair share of those gains has accrued to the consumers affected by the restriction of competition. Conclusions on the fair share issue It follows that the Court of Appeal arrived at the correct decision on this point, albeit by reasoning which was not precisely the same as that set out above. We therefore dismiss the appeal on issue (iii). Having reached that clear conclusion, it is unnecessary, and would be inappropriate, for this court to make a reference to the CJEU merely for the purpose of obtaining its clarification of the effect of the second condition in article 101(3) TFEU. It may, however, be helpful if, in addition to rejecting Visas argument, we provide some positive guidance, based upon our own understanding of the EU materials, while recognising that it lacks the authority accorded by EU law to a judgment of the CJEU. The second condition in article 101(3) arises only if the first condition is satisfied. In order to meet the requirements of the first condition, in a situation where there is a two sided market and the restrictive effects of the measure in question are experienced by consumers in only one of those markets, and where the consumers in both markets are not substantially the same, it has to be proved (1) that the measure causes appreciable objective advantages for consumers in the market where the restrictive effects are felt, and (2) that the objective advantages caused by the measure for consumers in both markets, taken together, compensate for the disadvantages which the measure entails for competition: see paras 240 242 of Mastercard CJ. If the first condition is satisfied, and the second condition then has to be considered, the best available guidance from the CJEU as to how it should be applied in the context of a two sided market is the Opinion of Advocate General Mengozzi in Mastercard CJ, the matter not having been considered by the Court of Justice in its judgment in that case, or by the General Court in Mastercard GC. The Advocate Generals reasoning in point 156 of his Opinion can be summarised in the following propositions: (1) The consumers referred to in the second condition are the direct or indirect consumers of the goods or services covered by the measure: here, the merchants. (2) Those consumers must be compensated in full for the adverse effects that they bear owing to the restriction of competition resulting from the measure. That reasoning is consistent with the Guidelines. It also reflects the language of the second condition. The merchants are the consumers of the services which are subject to the restriction of competition, and are therefore the consumers which the second condition is presumably intended to protect. If the merchants are not fully compensated for the harm inflicted on them by the restrictive measure, it is difficult to see how they can be said to receive a fair share of the resultant benefits. As the Advocate General indicated at point 158 of his Opinion, it is not the purpose of competition law to permit anti competitive practices to harm consumers in one market for the sake of providing benefits to those in another. Issue (iv) The broad axe issue This issue is concerned with the degree of precision that is required in the quantification of mitigation of loss where a defendant to a claim for damages arising out of a breach of competition law asserts that the claimant has mitigated its loss through the passing on of all or part of an overcharge to its customers. Mastercard raises this issue, which relates to a passage in the judgment of the Court of Appeal (para 331) in which the court rejected the submission that the broad axe principle of establishing recoverable loss applies to the burden on Mastercard to establish the fact and amount of pass on by Sainsburys (emphasis added). The court continued: The broad axe principle is applicable where the claimant has suffered loss as a result of the defendants culpable conduct but there is a lack of evidence as to the amount of such loss. There is no scope for the application of any such principle where the burden lies on the defendant to establish a pass on of the unlawful overcharge in order to reduce the amount recoverable by the claimant. The broad axe issue which is said to arise out of this statement is: Did the Court of Appeal find, and if so, did it err in law in finding, that a defendant has to prove the exact amount of loss mitigated in order to reduce damages?. The Court of Appeals statement is part of its discussion of a ground of appeal based on the assertion that the CAT had been inconsistent in rejecting Mastercards case that the merchants had mitigated their loss by pass on while making an allowance, when awarding compound interest, for pass on, which it estimated at 50% of the claimed loss (paras 320 342). Mastercard has not renewed that submission in these appeals, but, as we explain below, the debate around this issue widened in the course of the hearing. The Court of Appeals statement, which is the subject matter of this issue, must not be read in isolation. In the following paragraph (para 332) the court stated: On the other hand, we accept Mr Hoskinss submission that in each case it is a matter for the judge to decide whether, on the evidence before her or him, the defendant can show that there is a sufficiently close causal connection between an overcharge and an increase in the direct purchasers price. We see no reason why that increase should not be established by a combination of empirical fact and economic opinion evidence. It is not appropriate for us on these appeals to be more specific as to the nature and type of evidence capable of satisfying a trial judge that there is a sufficiently close causal connection. It is therefore clear that the Court of Appeal was not excluding any form of evidence as relevant to the establishment of pass on, but was drawing a distinction between the degree of precision in quantification required of the defendant pleading pass on in mitigation of loss and that which was required of the victim of the wrong in establishing its claim. The questions which arise are whether there is a requirement in European law or otherwise a basis in principle for that distinction. Mastercards stance at the hearing before this court was that it has to prove that the merchants passed on some of the overcharge to their customers but that having done so, the quantification of the extent of the pass on did not have to be precise where such precision could not reasonably be achieved. The court, having regard to all of the evidence, could and should estimate the extent of the pass on in order to give adequate compensation to the claimant and avoid over compensation. Mastercard accepts that at the trial before the CAT of Sainsburys claim against it, which covered quantification as well as liability (see para 28 above), it had not succeeded in proving that the overcharge had caused Sainsburys to raise the prices which it charged its customers. The matter is closed in that dispute but it remains a live issue in relation to other claims. The scope of the issue expanded as a result of exchanges with the bench during the hearing of the appeal. On the invitation of the court, Mastercard and Visa made further written submissions on the burden of proof. They argue that the legal burden lies on the claimant to prove its loss in the form of lost profits, that no question of mitigation of loss arises, and that there is no burden on the defendants in relation to the quantification of the merchants claims resulting from the pass on of the overcharge. AAM and Sainsburys have lodged written submissions in reply. In addressing the issue and these submissions, we examine, first, the requirements of EU law in relation to the claims for damages which the merchants advance; secondly, (in order to determine whether there is a question of mitigation of loss) whether the merchants are entitled in law to use the overcharge which is included in the MSC as the prima facie measure of their losses; thirdly, the burden of proof in the assessment of the damages due to the claimants; and, fourthly, the question of the degree of precision required in establishing the likely extent of any pass on. The requirements of EU law The claims of the merchants in these appeals are for damages for loss caused to them by the tortious acts of the operators of the payment card schemes in breach of their statutory obligations under the 1998 Act. It is not in dispute, as we discuss below, that the fundamental principle underlying the merchants claims is that the damages to which they are entitled are compensatory; the merchants are entitled to be placed, so far as money can achieve that, in the position which they would have been in but for the tortious acts which have caused them loss. Most of the case law of the CJEU, to which both the CAT and the Court of Appeal have referred, concerns claims for restitution arising from illegally levied taxes and similar charges such as occurred in the classic case of Amministrazione delle Finanze dello Stato v San Giorgio SpA (Case 199/82) [1983] ECR 3595. In those cases, the CJEU recognised the right of the defendant to meet the claim for restitution with the defence of pass on so that the claimant would not be unjustly enriched. The CJEU analysed the defence as an exception to the principle that taxes incompatible with EU law must be reimbursed: Socit Comateb v Directeur Gnrale des Douanes et Droits Indirects (Joined Cases C 192/95 to C 218/95) [1997] ECR I 165; [1997] STC 1006, para 21. The CJEU has limited the scope of that defence; it requires that the defence be interpreted strictly because it operates as a restriction upon the EU right to repayment of the unlawfully levied taxes. There can be no presumption that the unlawful charges have been passed on. Whether there has been a pass on is a question of fact to be established on evidence adduced before the national court: Socit Comateb (above) para 25; Webers Wine World Handels GmbH v Abgabenberufungskommission Wien (Case C 147/01) [2005] All ER (EC) 224; [2003] ECR I 11365; [2004] 1 CMLR 7, paras 93 97. The direct pass on of a wrongly levied tax is the sole exception to the right of reimbursement: Lady & Kid A/S v Skatteministeriet (Case C 398/09) [2012] All ER (EC) 410; [2011] ECR I 7375; [2012] 1 CMLR 14, paras 20 and 26. In that case, the Court of Justice rejected an argument that the taxpayer would be unjustly enriched by repayment of an unlawful levy because the taxpayer would have benefited from the concomitant abolition of other levies charged on a different basis. The benefit of the saving arising from the abolition of the other levies could not be regarded as unjust enrichment in EU law and could not be set off against the burden of the unlawful levy: para 26. No challenge is or can be made in relation to those judgments. But these appeals are not concerned with the EU rules on the reimbursement of unlawfully levied charges. They are concerned with claims for damages for losses incurred as a result of breaches of competition law. It is necessary to consider what EU law requires in relation to such claims. The CJEU recognises that the ability of persons, who have suffered loss by the anti competitive practices of others, to obtain damages in the courts of member states by the application of the rules of national law makes an important contribution to the maintenance of effective competition in the EU: Courage Ltd v Crehan (Case C 453/99) [2002] QB 507, paras 26 27. In para 29 of that judgment the Court of Justice sets out the essential requirements which are to govern actions in national courts for damages for breach of EU competition law. It states: [I]n the absence of Community rules governing the matter, it is for the domestic legal system of each member state to designate the courts and tribunals having jurisdiction and to lay down the detailed procedural rules governing actions for safeguarding rights which individuals derive directly from Community law, provided that such rules are not less favourable than those governing similar domestic actions (principle of equivalence) and that they do not render practically impossible or excessively difficult the exercise of law (principle of rights conferred by Community effectiveness): see Palmisani v Istituto Nazionale della Previdenza Sociale (Case C 261/95) [1997] ECR I 4025, 4046, para 27. In para 30 of its judgment, the Court of Justice confirmed that Community law does not prevent national courts from taking steps to ensure that the protection of rights guaranteed by EU law does not entail the unjust enrichment of those who enjoy them. It refers in support of this principle to, among others, Hans Just I/S v Danish Ministry for Fiscal Affairs (Case 68/79) [1980] ECR 501, 523, para 26. Hans Just is a case about the unlawful imposition of excise levies on imports, and in para 26 of that case the Court of Justice stated: There is nothing therefore, from the point of view of Community law, to prevent national courts from taking account in accordance with their national law of the fact that it has been possible for charges unduly levied to be incorporated in the prices of the undertaking liable for the charge and to be passed on to the purchasers. In our view the reference in Courage Ltd to that paragraph in the Hans Just judgment is a recognition of the possibility and relevance of pass on. It is not an oblique incorporation of any other rules concerning the right of a taxpayer to obtain restitution of taxes levied in breach of EU law, which is a claim with a different legal basis. In relation to claims under national law for damages for breach of the statutory rules of competition law, the requirements of EU law are that a member state can lay down procedural rules governing actions which safeguard such rights derived from EU law, provided that the rules comply with the principle of equivalence and the principle of effectiveness: Courage Ltd (above) paras 29 30. We are not concerned on these appeals with the principle of equivalence. The only constraint on national law at the relevant time therefore was the principle of effectiveness which requires that the rules of domestic law do not make it practically impossible or excessively difficult to exercise rights guaranteed by EU law. The court must therefore give effect to the rules of English law governing claims for damages for breach of statutory duty unless those rules were to conflict with the principle of effectiveness. It is therefore a question of fact in each case, which the national court must resolve on the evidence adduced before it, whether an overcharge resulting from a breach of competition law has caused the claimant to suffer loss or whether all or part of the overcharge has been passed on by the claimant to its customers or otherwise mitigated. The principle of effectiveness applies to the procedural and evidential rules by which the court determines whether and to what extent the claimant has suffered loss. On 9 March 2017, the United Kingdom implemented Parliament and Council Directive 2014/104/EU of 26 November 2014 on certain rules governing actions for damages under national law for infringements of the competition law provisions of the member states and of the European Union (OJ 2014 L349, p 1) (the Damages Directive) by bringing into effect Schedule 8A to the 1998 Act (as inserted by Schedule 1 to the Claims in respect of Loss or Damage arising from Competition Infringements (Competition Act 1998 and Other Enactments (Amendment)) Regulations 2017 (SI 2017/385)), which in paragraph 11(2) imposes on the defendant the burden of proving that the claimant has passed on an overcharge resulting from an infringement of competition law, and the extent to which the claimant did so. But we are not concerned with this provision because the substantive provisions of the Damages Directive are not retrospective and the other provisions do not apply to cases of which a court was seised before 26 December 2014: article 22. The merchants in these appeals each issued their claims before that date. The Damages Directive does not govern these claims. Nonetheless, the Damages Directive casts some light on the pre existing requirements of EU law, as recital 12 states that it reaffirms the acquis communautaire as to the right to compensation for harm caused by breach of EU competition law. We return to this when we discuss the degree of precision required of the defendant. Further, the Damages Directive has taken EU competition law in a radically different direction from the federal law of the United States in its approach to pass on. It leaves it to the English courts to apply the normal rules of English law on mitigation of damages, including the effect of pass on. The nature of the claims The merchants claims are for the added costs which they have incurred as a result of the MSC, which the acquiring banks have charged them, being larger than it would have been if there had been no breach of competition law. Sainsburys claims damages measured by the difference between the sums which it paid the acquirers through the MSC and the sums which it would have paid if the acquirers market had not been distorted by the MIF. Similarly, AAMs principal pleaded case is that they are entitled to recover the basic amounts by which they have been unlawfully overcharged with an alternative case that in so far as the unlawful overcharges have been passed on in their selling prices to their customers, they have suffered a loss of profit on the sales of the goods concerned through a reduced volume of sales. In each case the merchants primary claim of damages is for the pecuniary loss which has resulted directly from the breach of competition law by the operators of the schemes. That direct loss is prima facie measured by the extent of the overcharge in the MSC. It is trite law that, as a general principle, the damages to be awarded for loss caused by tort are compensatory. The claimant is entitled to be placed in the position it would have been in if the tort had not been committed. A classic statement of this principle is that of Lord Blackburn in Livingstone v Rawyards Coal Co (1880) 5 App Cas 25, 39; (1880) 7 R (HL) 1, 7: I do not think there is any difference of opinion as to its being a general rule that, where any injury is to be compensated by damages, in settling the sum of money to be given for reparation of damages you should as nearly as possible get at that sum of money which will put the party who has been injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong for which he is now getting his compensation or reparation. See also Watson, Laidlaw, & Co Ltd v Pott, Cassels & Williamson 1914 SC (HL) 18, 29 per Lord Shaw of Dunfermline, who spoke of the principle of restoration; One Step (Support) Ltd v Morris Garner [2018] UKSC 20; [2019] AC 649, paras 25 27 per Lord Reed. In the United States, concerns about the complexity, uncertainty and cost of calculating the existence and effects of pass on in federal anti trust litigation have caused the US Supreme Court to exclude a defence of pass on under federal law and to allow the claimant to use the amount of the overcharge as the basis of its claim in a treble damage suit: Hanover Shoe Inc v United Shoe Machinery Corpn 392 US 481 (1968), 491 494 per White J. By contrast, in the United Kingdom there is, as is well known, no entitlement to treble damages. Nor is there any exclusion of pass on as an element in the calculation of damages and the normal rule of compensatory damages applies to claims for damages for breach of statutory duty: Devenish Nutrition Ltd v Sanofi Aventis SA [2008] EWCA Civ 1086; [2009] Ch 390, 477, para 147 per Longmore LJ, pp 478 479, para 151 per Tuckey LJ; Emerald Supplies Ltd v British Airways plc [2009] EWHC 741 (Ch); [2010] Ch 48, paras 36 and 37 per Sir Andrew Morritt C; W H Newson Holding Ltd v IMI plc [2013] EWCA Civ 1377; [2014] Bus LR 156, para 40 per Arden LJ. In this respect, English law and Scots law are consistent with EU law which now requires member states to ensure that there is a pass on defence: articles 12(2) and 13 and recital 39 of the Damages Directive. In the legal systems of the United Kingdom pass on is an element in the quantification of damages rather than a defence in a strict sense. But so long as the UKs competition rules remain aligned to those of the EU, the pass on of an overcharge remains a relevant factor in the assessment of damages. There are sound reasons for taking account of pass on in the calculation of damages for breach of competition law. Not only is it required by the compensatory principle but also there are cases where there is a need to avoid double recovery through claims in respect of the same overcharge by a direct purchaser and by subsequent purchasers in a chain, to whom an overcharge has been passed on in whole or in part. The question then arises as to whether the merchants are entitled to claim as the prima facie measure of their loss the overcharge in the MSC which results from the MIF. The merchants say that they are so entitled because they have had to pay out more than they would have but for the anti competitive practices of the schemes and so have suffered pecuniary loss. On the other hand, Visa in its supplementary written submissions submits that their claims are for pure economic loss and must be claims for the loss of the profit which they would have enjoyed but for the alleged wrongful act of the defendants. We are satisfied that the merchants are correct in their submissions that they are entitled to plead as the prima facie measure of their loss the pecuniary loss measured by the overcharge in the MSC and that they do not have to plead and prove a consequential loss of profit. There are many circumstances, which are not confined to damage to property, in which the law allows the recovery of damages without regard to the claimants profitability. If a claimant suffers damage to property, such as a vehicle or a ship, as a result of the tortious actions of a defendant, it can claim as damages the diminution in value of the damaged property, usually measured by the cost of repairing the property, and consequential loss, such as the loss of use of the property while it was being repaired, without having to show that that expenditure diminished its overall profitability. See, for example, Coles v Hetherton [2013] EWCA Civ 1704; [2015] 1 WLR 160; The London Corpn [1935] P 70; The World Beauty [1970] P 144. In a claim for contractual damages resulting from the failure of a supplier to deliver goods to a purchaser, the prima facie measure of damages is the difference between the market value of those goods and the contract price which the purchaser would have had to pay: Garnac Grain Co Inc v H M F Faure & Fairclough Ltd [1968] AC 1130, 1140 per Lord Pearson. Where charterers of a vessel redelivered the vessel two years before the contractual date on which the charterparty ended, the court accepted the owners claim for loss of profits from that charterparty during the remaining two years of the charterparty without having regard to the overall profitability of the claimant: Fulton Shipping Inc of Panama v Globalia Business Travel SAU (formerly Travelplan SAU) of Spain [2017] UKSC 43; [2017] 1 WLR 2581. The effect of the breach on the overall profitability of the claimant in each case was not the relevant measure of damages. Similarly, if a claimant incurs expenditure in replacing items which a supplier had failed to deliver, it is entitled to damages without having to show that the breach of contract adversely affected its overall profitability. An illustration of this is the judgment of Leggatt J in Thai Airways International Public Co Ltd v KI Holdings Co Ltd [2015] EWHC 1250 (Comm); [2016] 1 All ER (Comm) 675. The case concerned a claim for damages resulting from the defendants (Koitos) breach of contract through the late delivery and failure to deliver aircraft seats to Thai Airways for use in new aircraft which they had purchased. Thai Airways, facing a shortage of aircraft to perform its planned services, leased three aircraft on short term operating leases to cover the gap in capacity and ordered replacement seats for its new aircraft from another supplier. It claimed as damages the costs which it incurred in mitigating its loss and its principal claim was for the cost of leasing the replacement aircraft. Leggatt J held that Thai Airways was entitled to recover among other things, the costs of leasing the replacement aircraft for two years. Thai Airways did not attempt to base its claim on an estimate of a net loss of profits measured by the differential between what its overall profits would have been if Koito had performed its contractual obligations and the profits which Thai Airways actually made during the period of the leases of the replacement aircraft. Having regard to the complexity of the arrangements by which the airline sought to maximise the efficiency of the use of its aircraft, that calculation would have been extremely complex. In the present appeals, the merchants by paying the overcharge in the MSC to the acquirers have lost funds which they could have used for several purposes. As sophisticated retailers, which obtain their supplies from many suppliers and sell a wide range of goods to many customers, they can respond to the imposition of a cost in a number of ways, as the CAT pointed out in paras 434 and 455 of its judgment. There are four principal options: (i) a merchant can do nothing in response to the increased cost and thereby suffer a corresponding reduction of profits or an enhanced loss; or (ii) the merchant can respond by reducing discretionary expenditure on its business such as by reducing its marketing and advertising budget or restricting its capital expenditure; or (iii) the merchant can seek to reduce its costs by negotiation with its many suppliers; or (iv) the merchant can pass on the costs by increasing the prices which it charges its customers. Which option or combination of options a merchant will adopt will depend on the markets in which it operates and its response may be influenced by whether the cost was one to which it alone was subjected or was one which was shared by its competitors. If the merchant were to adopt only option (i) or (ii) or a combination of them, its loss would be measured by the funds which it paid out on the overcharge because it would have been deprived of those funds for use in its business. Option (iii) might reduce the merchants loss. Option (iv) also would reduce the merchants loss except to the extent that it had a volume effect, if higher prices were to reduce the volume of its sales and thereby have an effect on the merchants profits. In our view the merchants are entitled to claim the overcharge on the MSC as the prima facie measure of their loss. But if there is evidence that they have adopted either option (iii) or (iv) or a combination of both to any extent, the compensatory principle mandates the court to take account of their effect and there will be a question of mitigation of loss, to which we now turn. Mitigation and the burden of proof Visa and Mastercard submit that the burden is on a claimant to prove its loss taking account of any pass on. Visa presents the merchants claims as claims for loss of profits. On this presentation, the claim for the overcharge incorporated in the MSC is a poor surrogate for loss of profits and must be reduced by any pass on if it is to comply with the compensatory principle. Sainsburys and AAM on the other hand submit that, as they have stated a prima facie case of their loss, it falls to the defendants to assert and prove that the merchants have mitigated their loss by passing on the relevant costs in the prices which they charged their customers. There are two reasons why the merchants are correct in their submission that they do not have the legal burden of proving their loss of overall profits caused by the overcharge. First, if the law were to require a claimant, which is a complex trading entity, to prove the effect on its overall profits of a particular overcharge, the claimant might face an insurmountable burden in establishing its claim. Were there to be such a domestic rule, it would very probably offend the principle of effectiveness. It is the duty of the court to give full effect to the provisions of article 101 by enabling the claimant to obtain damages for the loss which has been caused by anti competitive conduct. Secondly, an exclusive focus on the claimants profits would result in it being undercompensated if the overcharge had caused it to forgo discretionary expenditure to develop its business which did not promptly enhance its profits (ie option (ii) in para 205 above). We are also satisfied that the merchants are correct in their assertion that there is a legal burden on the defendants to plead and prove that the merchants have mitigated their loss. See for example, The World Beauty, 154 per Lord Denning MR; OMV Petrom SA v Glencore International AG [2016] EWCA Civ 778; [2016] 2 Lloyds Rep 432, para 47 per Christopher Clarke LJ. The statement of the Court of Appeal in para 324 of its judgment in the present case is an accurate statement of English law: Whether or not the unlawful charge has been passed on is a question of fact, the burden of proving which lies on the defendant who asserts it. But in the context of these appeals, as we discuss below, the significance of the legal burden should not be overstated. In some cases of mitigation, the court is concerned with additional benefits which a claimant has gained from the mitigation action which it has taken. In such a case, it is for the defendant to show that the benefits should be set off against the prima facie claim of loss. For example, in Thai Airways (above) it fell to Koito to prove that the net benefits that the airline received as a result of leasing the replacement aircraft during the relevant period offset the losses which it suffered from the delayed entry into service of the aircraft for which Koito failed to supply the seats. Such cases raise delicate questions as to whether a benefit is sufficiently causally connected with the breach of contract or (in tort) the wrong or whether the benefit was the result of an independent commercial decision by the claimant. In Fulton Shipping at para 30, Lord Clarke of Stone cum Ebony explained that there must be a sufficiently close link between the benefit and the loss caused by the wrongdoer: The relevant link is causation. The benefit to be brought into account must have been caused either by the breach of the charterparty or by a successful act of mitigation. In that case, by selling the vessel after the charterparty had been prematurely terminated the owners avoided a substantial capital loss occasioned by the collapse in the market for such vessels following the financial crisis in 2008. While the premature termination of the charterparty in Fulton Shipping was the occasion for the owners decision to sell the vessel, the court held that that decision was not necessitated by the termination but was a commercial decision of the owners at their own risk. In other cases, the court may be concerned with a failure of a claimant to act reasonably in its response to its loss. As Leggatt J stated in Thai Airways at para 33, quoting from an article by A Dyson and A Kramer, There is No Breach Date Rule: Mitigation, Difference in Value and Date of Assessment (2014) 130 LQR 259, 263: damages are assessed as if the claimant acted reasonably, if in fact it did not act reasonably. Thus, for example in Golden Strait Corpn v Nippon Yusen Kubishika Kaisha (The Golden Victory) [2007] UKHL 12; [2007] 2 AC 353, Lord Bingham of Cornhill stated (at para 10): An injured party such as the owners may not, generally speaking, recover damages against a repudiator such as the charterers for loss which he could reasonably have avoided by taking reasonable commercial steps to mitigate his loss. Thus where, as here, there is an available market for the chartering of vessels, the injured partys loss will be calculated on the assumption that he has, on or within a reasonable time of accepting the repudiation, taken reasonable commercial steps to obtain alternative employment for the vessel for the best consideration reasonably obtainable. We are not concerned in these appeals with additional benefits resulting from a victims response to a wrong which was an independent commercial decision or with any allegation of a failure to take reasonable commercial steps in response to a loss. The issue of mitigation which arises is whether in fact the merchants have avoided all or part of their losses. In the classic case of British Westinghouse Electric and Manufacturing Co Ltd v Underground Electric Railways Co of London Ltd [1912] AC 673, at 689 Viscount Haldane described the principle that the claimant cannot recover for avoided loss in these terms: [W]hen in the course of his business [the claimant] has taken action arising out of the transaction, which action has diminished his loss, the effect in actual diminution of the loss he has suffered may be taken into account (Emphasis added) Here also a question of legal or proximate causation arises as the underlined words show. But the question of legal causation is straightforward in the context of a retail business in which the merchant seeks to recover its costs in its annual or other regular budgeting. The relevant question is a factual question: has the claimant in the course of its business recovered from others the costs of the MSC, including the overcharge contained therein? The merchants, having acted reasonably, are entitled to recover their factual loss. If the court were to conclude on the evidence that the merchant had by reducing the cost of its supplies or by the pass on of the cost to its customers (options (iii) and (iv) in para 205 above) transferred all or part of its loss to others, its true loss would not be the prima facie measure of the overcharge but a lesser sum. The legal burden lies on the operators of the schemes to establish that the merchants have recovered the costs incurred in the MSC. But once the defendants have raised the issue of mitigation, in the form of pass on, there is a heavy evidential burden on the merchants to provide evidence as to how they have dealt with the recovery of their costs in their business. Most of the relevant information about what a merchant actually has done to cover its costs, including the cost of the MSC, will be exclusively in the hands of the merchant itself. The merchant must therefore produce that evidence in order to forestall adverse inferences being taken against it by the court which seeks to apply the compensatory principle. The degree of precision required in establishing the extent of pass on of an overcharge The court in applying the compensatory principle is charged with avoiding under compensation and also over compensation. Justice is not achieved if a claimant receives less or more than its actual loss. But in applying the principle the court must also have regard to another principle, enshrined in the overriding objective of the Civil Procedure Rules, that legal disputes should be dealt with at a proportionate cost. The court and the parties may have to forgo precision, even where it is possible, if the cost of achieving that precision is disproportionate, and rely on estimates. The common law takes a pragmatic view of the degree of certainty with which damages must be pleaded and proved: Devenish Nutrition Ltd v Sanofi Aventis SA [2007] EWHC 2394 (Ch); [2009] Ch 390, 408, para 30 per Lewison J. In Livingstone v Rawyards Coal Co (above) Lord Blackburn in speaking of getting as nearly as possible to the sum which would restore the claimant, recognised that the courts task in achieving reparation is not always precise. Similarly, Lord Shaw in Watson Laidlaw & Co Ltd (above, at 29 to 30) spoke of restoration by way of compensation being accomplished to a large extent by the exercise of a sound imagination and the practice of the broad axe and of the attempt of justice to get back to the status quo ante in fact, or to reach imaginatively, by the process of compensation, a result in which the same principle is followed. When the court deals with claims for personal injury, loss of life or loss of reputation, it has to put a monetary value on things that cannot be valued precisely. But the task of valuing claims for purely monetary losses may also lack precision if the compensatory principle is to be honoured, particularly when one is dealing with complex trading entities such as the merchants in these appeals. We see this for example in AAMs alternative case which seeks to assess the loss of profit caused by the volume effect where the overcharge was passed on to their customers in the form of higher prices. Such a claim is likely to depend in considerable measure on economic opinion evidence and involve imprecise estimates. We see no reason in principle why, in assessing compensatory damages, there should be a requirement of greater precision in the quantification of the amount of an overcharge which has been passed on to suppliers or customers because there is a legal burden on the defendants in relation to mitigation of loss. The contrary view appears to have been based on an application of (a) the CJEU jurisprudence relating to a defence to claims for restitution, that there should be an identifiable increase in a retail price directly attributable to the unlawful charge and (b) the requirement, discussed in Fulton Shipping, of a close causative link between a wrong and a benefit which the victim obtains as a consequence of the wrong: see the judgment of the Court of Appeal at paras 327 330, 337 340. As we have said, the relevant requirement of EU law is the principle of effectiveness. The assessment of damages based on the compensatory principle does not offend the principle of effectiveness provided that the court does not require unreasonable precision from the claimant. On the contrary, the Damages Directive is based on the compensatory principle. The European Commission has issued Guidelines for national courts on how to estimate the share of overcharge which was passed on to the indirect purchaser (2019/C 267/07) (the 2019 Guidelines) in accordance with a power conferred by article 16 of the Damages Directive. The 2019 Guidelines make clear (para 12) that the compensatory principle underlies the entire Damages Directive and must be understood as requiring that a person entitled to claim compensation for the harm suffered must be placed in the position in which that person would have been had the infringement not been committed. It goes on to state that pass on may be invoked by an infringer as a shield against a claim for damages and by an indirect purchaser as a sword to support the argument that it has suffered harm (paras 18 19). Article 12.1 of the Damages Directive requires member states to ensure not only that both direct and indirect purchasers who have suffered harm should be able to claim full compensation but also that compensation exceeding the harm caused by the infringement of competition law is avoided. Article 12.5 states: Member states shall ensure that the national courts have the power to estimate, in accordance with national procedures, the share of any overcharge that was passed on. Similarly, in article 17.1 the Damages Directive states: Member states shall ensure that neither the burden nor the standard of proof required for the quantification of harm renders the exercise of the right to damages practically impossible or excessively difficult. Member states shall ensure that the national courts are empowered, in accordance with national procedures, to estimate the amount of harm if it is established that a claimant suffered harm but it is practically impossible or excessively difficult precisely to quantify the harm suffered on the basis of the evidence available. In discussing those articles of the Damages Directive, the 2019 Guidelines (section 2.3, paras 30 35) recognise that the national courts in addressing the issue of pass on will have to resort to estimates. In para 33 the 2019 Guidelines state that the principles of equivalence and effectiveness mean, as regards the power to estimate, that national courts cannot reject submissions on passing on merely because a party is unable to precisely quantify the passing on effects. The power to estimate requires national courts to, firstly, base their assessment on the information reasonably available and, secondly, strive for an approximation of the amount or share of passing on which is plausible (para 34). The 2019 Guidelines note that several member states already have rules which correspond to the power to estimate which the Damages Directive envisages and (in footnote 39) refer to Lord Shaws statement in Watson, Laidlaw & Co Ltd (above) that harm may be quantified by the exercise of a sound imagination and the practice of the broad axe, and to the application of that statement by the Court of Appeal in Devenish Nutrition Ltd (above), para 110. As the regime is based in the compensatory principle and envisages claims by direct and indirect purchasers in a chain of supply it is logical that the power to estimate the effects of passing on applies equally when pass on is used as a sword by a claimant or as a shield by a defendant. The loss caused by the overcharge included in the MSC was an increased cost which the merchants would in all probability not address as an individual cost but would take into account along with a multiplicity of other costs when developing their annual budgets. The extent to which a merchant utilised each of the four options, which the CAT identified and we described in para 205 above, can only be a matter of estimation. In accordance with the compensatory principle and the principle of proportionality, the law does not require unreasonable precision in the proof of the amount of the prima facie loss which the merchants have passed on to suppliers and customers. Conclusion on the broad axe issue In conclusion, we do not interpret the Court of Appeal as having held that the defendants had to prove the exact amount of the loss mitigated. But in so far as the Court of Appeal has required a greater degree of precision in the quantification of pass on from the defendant than from a claimant, the Court erred. For these reasons, the appeal succeeds on issue (iv). Issue (v) The remission issue: AAMs cross appeal The cross appeal is only relevant to the AAM proceedings. By our judgment on this appeal, we have upheld the conclusion of the Court of Appeal that the default MIFs infringed article 101(1). Therefore, it is necessary to consider Mastercards claim in the AAM proceedings that the default MIFs should be treated as exempt under article 101(3). This was an issue which was fully canvassed at trial before Popplewell J. The judge correctly held that in order to qualify for exemption under article 101(3) an anti competitive restriction must meet a number of cumulative conditions. It is the first and second conditions which are relevant for present purposes, namely that any given default MIF must: (i) contribute to improving the production or distribution of goods or to promoting technical or economic progress and (ii) allow consumers a fair share of the relevant benefits. At trial, Mastercard had a full opportunity to present any evidence it wished in support of its case that the default MIFs at issue should be treated as exempt pursuant to article 101(3). Popplewell J considered that Mastercard had established its case that the default MIFs were exempt. A critical part of his reasoning was that part of the MIFs paid to issuers had been passed through to their cardholder customers in the form of incentives to encourage use of scheme credit or debit cards to purchase more goods from merchants, thereby providing (so Mastercard asserted) increased benefits for the merchants issuer pass through. The Court of Appeal considered this aspect of Popplewell Js judgment at paras 211 271. It held that there were a number of flaws in the judges analysis. It noted that there was a critical gap in the evidence put forward by Mastercard: it did not provide evidence from issuers regarding the extent to which there was pass through of the MIFs to cardholders, and had not attempted to obtain such evidence (paras 242 244). It was therefore impossible to tell to what extent (if at all) the cost to merchants of having to pay a default MIF in relation to each card transaction might be outweighed by countervailing benefits to them from use of MIF income to incentivise increased card use. The judge had failed to carry out this balancing exercise (paras 246 248). As the Court of Appeal noted at para 245, all that could be said was that the expert witnesses on each side agreed, purely on the basis of economic theory, that pass through could incentivise card use; but there was no empirical, factual evidence on the point as would have been necessary to show that pass through did in fact occur, the extent of it and whether incentives to cardholders would in fact have resulted in more use of scheme cards (as opposed to cardholders simply using their scheme cards all the time in any event, without being influenced by incentives, so that the merchants bore the cost of the MIFs without any corresponding benefit: the always card transactions point described at paras 250 251). Since Mastercard could not establish by evidence the extent of pass through, it could not show the extent to which MIF revenue was used to incentivise card usage, nor whether and to what extent it did in fact stimulate additional card usage; and this was fatal to Mastercards case for exemption (paras 252 254). Accordingly, the Court of Appeal held (at para 255) that the judge should have concluded, by reference to this always cards point, that Mastercard could not establish, even on the basis of economic theory, that the extent of pass through was such that the advantages thereby conferred outweighed the disadvantages to the relevant consumers [the merchants]; and it further held (ibid) that the various materials relied on by Mastercard did not satisfy the requirement for cogent factual or empirical evidence of pass through. The court then proceeded to make further explicit rulings in paras 257 259 as follows: 257. The judge should have concluded that, in the absence of any evidence as to the actual extent of the pass through, Mastercard had failed to establish by robust analysis and cogent evidence, or otherwise, a sufficient causal link between the default MIFs and any net benefits, so that their claim for exemption under article 101(3) failed. 258. [T]he judge should have concluded, on the basis of the evidence before him, that the first condition of article 101(3), the benefits requirement, was not satisfied so that Mastercard had not established entitlement to an exemption under article 101(3). 259. [Further, in relation to the second condition for an exemption under article 101(3), the fair share requirement, on the evidence advanced at trial by Mastercard] had the judge carried out the necessary balancing exercise, he would inevitably have concluded that Mastercard could not satisfy the second condition either. As regards the evidential standard to be applied, this court has confirmed that as a matter of EU law, cogent empirical evidence is required to show that the claim for exemption is made out. In the light of this, the Court of Appeals conclusions in the AAM proceedings, as set out above, cannot be faulted. AAM should have succeeded on its claim under article 101(1). So far as concerns Mastercards defence based on article 101(3), there had been a full trial on this issue and on the evidence adduced at trial the judge should have dismissed it, as the Court of Appeal rightly held. Despite reaching this conclusion in the passages referred to above, the Court of Appeal made an order remitting the AAM proceedings to the CAT, alongside the two other sets of proceedings, for reconsideration of whether Mastercards case under article 101(3) in the AAM proceedings should have succeeded in whole or in part. According to the order, it is not open to any party to advance a new case or to adduce any fresh evidence on the remittals for reconsideration of Mastercards and Visas cases in each set of proceedings for exemption under article 101(3), but the parties to each of the proceedings may rely on evidence from the other two proceedings if and only to the extent that it is relevant to the case on exemption advanced in the proceedings in question. On any view, we consider that it would be impossible to justify an order in this form unless all the parties affected consented to it, since it would mean that a partys case could be determined by reference to evidence in other proceedings which it had not had a fair opportunity to controvert or subject to criticism or cross examination. Such consent was not obtained before the Court of Appeal made its order. Upon enquiry at the hearing in this court, it was only the parties in the Mastercard Sainsburys and Visa Sainsburys proceedings who said they were content with this order. AAM did not. However, the point taken by AAM in their cross appeal is a still more fundamental one. They say that, having rightly decided that the trial judge should have dismissed Mastercards article 101(3) defence and given judgment for AAM on its claim under article 101(1), it was not open to the Court of Appeal to order that the article 101(3) issue should be remitted for reconsideration and hence permit it to be re opened by Mastercard. This offends against the principle of finality in litigation. The Court of Appeals reasoning on this point is at para 366: We take the view that, despite what we have said above, it is not certain that, had Popplewell J had the benefit of this judgment and thus been fully aware of the need for empirical data and facts in order to prove an exemption, MasterCards case on article 101(3) would have failed in its entirety. It is possible, bearing in mind the acceptance by Sainsburys and the CAT in the other two cases that there was a lawful level of MIF, that the judge would have found that there was some exemptible level of MIF, albeit a lower one than he in fact found. Altogether removing the article 101(3) issue from reconsideration could therefore result in an unjustified windfall for the AAM parties. It seems far more just to us that the issue should be reconsidered in all three cases, based on the same principles, by the same tribunal. There is no real injustice to the AAM parties in the course we propose, since the windfall to which we have referred would have arisen from the procedural mishap caused by the separation of three cases raising almost identical issues. If the CAT is now able to reach a consistent conclusion in all three cases on the exemption and quantum issues, that will produce a fair and just outcome for all the parties. It would be a triumph of form over substance if we were to hold that we were unable to reach a just solution simply as a result of a procedural accident. In our judgment, this reasoning cannot be supported. We accept the submission of Mr Jon Turner QC for AAM that the Court of Appeal has erred in principle by allowing Mastercard to re open the article 101(3) issue on which, as the Court of Appeal held, it had lost after a full and fair trial of the issue. This offends against the strong principle of public policy and justice that there should be finality in litigation, which the Court of Appeal did not take properly into account. The court was wrong to characterise victory for AAM as an unjustified windfall or the product of a procedural mishap or accident. It was wrong to say that re opening the article 101(3) issue involved no real injustice for AAM. Under the Civil Procedure Rules (CPR), litigation is to be conducted in accordance with the overriding objective set out in CPR Part 1, that is in a manner enabling the court to deal with cases justly and at proportionate cost. CPR rule 52.20(2) provides that on an appeal, the appellate court has power, among other things, to (a) affirm, set aside or vary any order or judgment made or given by the lower court; (b) refer any claim or issue for determination by the lower court; or (c) order a new trial or hearing. By virtue of CPR rule 1.2(b) the procedural rules in the CPR are to be interpreted so as to give effect to the overriding objective; and by virtue of CPR rule 1.2(a) any power conferred on a court by the CPR is to be exercised so as to give effect to it. The higher courts have in a number of respects laid down important and binding principles regarding what justice requires in the context of litigation, and these inform the proper approach to the interpretation and application of the overriding objective. One such principle which is well established is that there should be finality in litigation. This is a general principle of justice which finds expression in several ways, which tend to be grouped under the portmanteau term res judicata: see Virgin Atlantic Airways Ltd v Zodiac Seats UK Ltd [2013] UKSC 46; [2014] AC 160, paras 17 26 per Lord Sumption. When a legal claim has finally been determined in litigation, a cause of action estoppel arises and it cannot be reopened. A binding issue estoppel may arise in respect of a matter, other than a legal claim, which is directly the subject of determination in proceedings. Further, parties are generally required to bring forward their whole case in one action, and attempts to revisit matters that have already been the subject of a determination (even if not formally a matter of cause of action estoppel or the subject of an issue estoppel) are liable to be barred as an abuse of process: Henderson v Henderson (1843) 3 Hare 100, 114 116 per Wigram V C; Johnson v Gore Wood & Co [2002] 2 AC 1, 31 per Lord Bingham of Cornhill and 58 59 per Lord Millett; Virgin Atlantic (above). Under this rule, first explored in Henderson v Henderson, a party is precluded from raising in subsequent proceedings matters which were not, but could and should have been raised in the earlier ones (Virgin Atlantic, para 17). As Sir Thomas Bingham MR (as he then was) explained in Barrow v Bankside Members Agency Ltd [1996] 1 WLR 257, 260: The rule in Henderson v Henderson requires the parties, when a matter becomes the subject of litigation between them in a court of competent jurisdiction, to bring their whole case before the court so that all aspects of it may be finally decided once and for all. In the absence of special circumstances, the parties cannot return to the court to advance arguments, claims or defences which they could have put forward for decision on the first occasion but failed to raise. The rule is not based on the doctrine of res judicata in a narrow sense, nor even on any strict doctrine of issue or cause of action estoppel. It is a rule of public policy based on the desirability, in the general interest as well as that of the parties themselves, that litigation should not drag on forever and that a defendant should not be oppressed by successive suits when one would do. That is the abuse at which the rule is directed. This is a rule based on what is required to do justice between the parties as well as on wider public policy considerations. It is a rule which is firmly underwritten by and inherent in the overriding objective. In our view, the order made by the Court of Appeal to remit the article 101(3) issue in the AAM proceedings for reconsideration by the CAT is contrary to the principle of finality in litigation as it finds expression in the rule in Henderson v Henderson. The trial before Popplewell J was a final trial between AAM and Mastercard of the issues between them under article 101(1) and 101(3) so far as affected Mastercards liability to AAM. In preparing for the trial, Mastercard was aware of the significance of the issue of pass through, not least because attention had been called to that issue in the Mastercard Commission Decision (as noted in para 243 in the judgment of the Court of Appeal). In any event, the issue of pass through was central to the way in which Mastercard sought to justify its claim for exemption under article 101(3). It had a full and fair opportunity to adduce any evidence it wished in respect of that claim. Yet, as the Court of Appeal found (at para 244), it did not attempt to obtain factual, empirical evidence on that issue, choosing instead to support its claim of exemption under article 101(3) by reference to economic theory. As explained above, on the evidence adduced at trial, the Court of Appeal rightly found that the judge should have upheld AAMs claim of infringement of article 101(1) and in the course of doing so should have dismissed Mastercards defence based on article 101(3). We agree with Mr Turners submission that in circumstances where: (i) in a final trial between private litigants to determine their rights and obligations inter se each side has had a fair opportunity to bring forward all the evidence that it wants to bring forward in support of its case, and (ii) where the appellate court has concluded that, on the basis of that evidence, one party ought to have won, the court should dispose of the matter by awarding a final remedy that reflects that outcome. This is necessary to do justice to the parties (so that the party that has won in a fair and it might be added, very expensive contest is not deprived of the fruits of its victory), to achieve finality, and to avoid the court enlarging the dispute outside the way in which the parties have chosen to frame it. In the adversarial system of litigation in this country, the task of the courts is to do justice between the parties in relation to the way in which they have framed and prosecuted their respective cases, rather than to carry out some wider inquisitorial function as a searcher after truth. In Al Medenni v Mars UK Ltd [2005] EWCA Civ 1041, Dyson LJ observed (at para 21): It is fundamental to our adversarial system of justice that the parties should clearly identify the issues that arise in the litigation, so that each has the opportunity of responding to the points made by the other. The function of the judge is to adjudicate on those issues alone. As Lord Wilberforce stated in Air Canada v Secretary of State for Trade [1983] 2 AC 394, 438: In a contest purely between one litigant and another the task of the court is to do, and be seen to be doing, justice between the parties There is no higher or additional duty to ascertain some independent truth. It often happens, from the imperfection of evidence, or the withholding of it, sometimes by the party in whose favour it would tell if presented, that an adjudication has to be made which is not, and is known not to be, the whole truth of the matter: yet if the decision has been in accordance with the available evidence and with the law, justice will have been fairly done. In our view, and with respect to them, the Court of Appeal lost sight of these principles when it made an order which would permit Mastercard to reopen its case under article 101(3) and rely upon evidence (adduced in other proceedings, but new in the AAM proceedings) which was not adduced at the trial of that issue. The matter may further be tested in various ways. Suppose Popplewell J had determined the issues before him as the Court of Appeal held they should have been determined by him (ie on the basis that Mastercards defence under article 101(3) failed) and there had been no need for an appeal. He would have made a final order in AAMs favour in 2017 giving judgment for them on their article 101(1) claim (necessarily thereby rejecting the article 101(3) defence), and that order would have constituted a cause of action estoppel in their favour. There could have been no question of Mastercard seeking to reopen that order by seeking to litigate again on the same issues, by relying on new evidence as adduced in other proceedings. It is difficult to see how it could be right for the Court of Appeal to produce a different outcome by reason of the adventitious circumstance that AAM had to go through the process of appeal to arrive at the result it was entitled to have achieved at first instance. Alternatively, one could analyse the outcome which would have been arrived at in relation to the article 101(3) defence as a matter of issue estoppel, and the same point could be made. Or again, one could analyse the position by reference to the rule in Henderson v Henderson and say that it would have been an abuse of process for Mastercard to have sought to re open the article 101(3) issue by reference to new evidence, the substance of which it had had the opportunity to adduce previously at trial before Popplewell J. Since it would have been unjust to allow an application by Mastercard to do that, it is difficult to see how it could be compatible with justice for the Court of Appeal to produce that same outcome by its exercise of discretion on its own initiative under CPR rule 52.20(2). On the contrary, in our view it was contrary to justice and to the overriding objective for the Court of Appeal to make the order it did in the AAM proceedings. It was also contrary to CPR rule 52.20(2) itself, on its proper construction, since under CPR rule 1.2(b) that provision falls to be interpreted in a way which is in conformity with the overriding objective. This is sufficient to justify allowing AAMs cross appeal. However, we also consider the comments made by the Court of Appeal at para 366 (above) to be misplaced. If it is decided by the CAT after the further hearing in the Mastercard Sainsburys proceedings and the Visa Sainsburys proceedings that, on the evidence and concessions made by Sainsburys in those proceedings (concessions with which AAM do not agree and which they consider to be baseless and wrongly made), there was some level of MIFs which would have been exempt under article 101(3), with the result that Sainsburys claims for damages for breach of article 101(1) would be reduced, that would in no way show that there was an unjustified windfall for AAM arising out of a final order in their favour in the AAM proceedings. As the Court of Appeal rightly held, after the fair trial which took place, the judge should have found that AAM succeeded in its claim. That result is not a windfall, nor is it unjustified. It is the just outcome of the contest fought by the parties in those proceedings. It would have made no difference if the fact that there was a separate trial of the AAM proceedings could be described as the result of a procedural mishap or accident, or if with hindsight it might have been thought better for all three sets of proceedings to be tried together. The fact would still remain that, as events transpired, Mastercard had lost to AAM at trial after a fair hearing on the issues between them. However, in any event, in our view it is not correct to characterise the way in which the AAM proceedings were dealt with separately from the other proceedings and went forward to be dealt with at a separate trial as being the result of a procedural mishap or accident. There are many sets of interchange damages claims pending against Mastercard and Visa (and other card system operators) in the court system, and it would be wholly impracticable for them all to be tried together at the same time. In a sensible and responsible way, Visa, Mastercard, Sainsburys and AAM debated at various stages whether the proceedings involving them could be case managed or heard together, and on each occasion the judgment was made that there were good reasons why they should not be. The fact that there have been three separate trials in the three sets of proceedings is not the result of any procedural accident, but rather of deliberate and informed choices made by the parties, courts and the CAT as to how these complex claims should be determined within the court system. It may also be observed that, contrary to what the Court of Appeal seems to have thought it would achieve by ordering a combined hearing in the CAT in the three sets of proceedings at issue in this appeal, that combined hearing will not produce a single, comprehensive determination of liability in relation to the other interchange fee damages claims. Those other claims will have to be determined in each case on the basis of the pleadings and the evidence adduced in that case. Conclusion on AAMs cross appeal For the reasons given above, AAMs cross appeal is allowed. The order made by the Court of Appeal will be varied, to substitute an order declaring that the relevant MIFs charged to AAM in the relevant period were contrary to article 101(1) (and the equivalent provisions of UK and Irish competition law); and that Mastercard has failed to discharge the burden on it of demonstrating that a MIF set at any positive level would have met the test for exemption under article 101(3) (and the equivalent provisions of UK and Irish law). If not settled, the AAM proceedings should then proceed to a trial on the issue of quantum of damages.

This appeal concerns whether certain rules of the Visa and Mastercard payment card schemes have the effect of restricting competition, in breach of article 101(1) of the Treaty on the Functioning of the European Union (TFEU) and equivalent national legislation. The appellants, Visa and Mastercard, operate open four party payment card schemes. Under these schemes, issuers (generally banks) issue debit and/or credit cards to cardholder customers and acquirers (also generally banks) provide payment services to merchants (such as the respondents). The scheme operator, Visa or Mastercard, sets the rules of the scheme and allows institutions to join as issuers and/or acquirers. The schemes operate as follows. A cardholder contracts with an issuer, which agrees to provide the cardholder with a Visa or Mastercard debit or credit card. It agrees terms on which they may use the card to buy goods or services from merchants, which may include a fee paid by the cardholder, an interest rate for credit, and incentives or rewards paid by the issuer to the cardholder for using the card (such as airmiles or cashback). Merchants contract with an acquirer, which agrees to provide services to the merchant enabling acceptance of the cards for a fee. This is known as the merchant service charge (MSC). To settle a transaction made between a cardholder and a merchant, the issuer pays the acquirer, who passes the payment on to the merchant, less the MSC. The rules of both schemes provide for the payment of a default interchange fee, known as the multilateral interchange fee (MIF), on each transaction, which is payable by the acquirer to the issuer. Though under the rules acquirers and issuers are not required to contract based on the MIF, in practice they invariably do so. Visa and Mastercard do not receive any part of the MIF or the MSC. Their remuneration comes from scheme fees paid by issuers and acquirers. For most of the claim period, the MIF typically accounted for some 90% of the MSC. Acquirers passed on all of the MIF to the merchants through the MSC, with negotiation between acquirers and merchants in respect of the MSC being limited to the level of the acquirers margin. Schemes such as the Visa and Mastercard schemes operate in a two sided market. On one side, issuers compete for the business of cardholder customers. On the other side, acquirers compete for the business of merchants to whom they seek to offer acquiring services. These proceedings concern the effect of MIFs on competition in the acquiring market. Article 101(1) TFEU prohibits agreements between companies that may affect trade between member states, and which have as their object or effect the restriction of competition. Article 101(3) provides for an exemption where the agreement improves the production or distribution of goods or promotes technical or economic progress while allowing consumers a fair share of the resulting benefit. These provisions are reflected in sections 2 and 9 of the Competition Act 1998 (the 1998 Act), respectively. The Visa and Mastercard schemes have previously been subject to scrutiny by competition authorities. In a decision dated 19 December 2007, the European Commission decided that the Mastercard MIFs applicable within the European Economic Area (EEA MIFs) breached article 101(1) (the Mastercard Commission Decision). Mastercard applied to the Court of Justice of the European Union (the CJEU) for annulment of the Mastercard Commission Decision, which was dismissed by a judgment of the General Court (Mastercard GC). Mastercard appealed this decision to the Court of Justice, which gave judgment dismissing the appeal (Mastercard CJ). The present appeal relates to three sets of proceedings. In the first, brought by Sainsburys Supermarkets Ltd (Sainsburys) against Mastercard, the Competition Appeal Tribunal (the CAT) held that Mastercard MIFs in the UK (UK MIFs) restricted competition by effect and awarded damages to Sainsburys. In the second, brought by Asda Stores Ltd, Argos Ltd and others, and WM Morrison Supermarkets plc (together AAM) against Mastercard, Popplewell J in the Commercial Court found that Mastercards EEA MIFs, UK MIFs and MIFs in the Republic of Ireland (Irish MIFs) did not infringe article 101 and were exempt under article 101(3) in any event. In the third, brought by Sainsburys against Visa, Phillips J in the Commercial Court dismissed the claim and found that Visas UK MIFs did not restrict competition in the acquiring market. At the request of the parties, Phillips J gave an additional judgment, in which he found that if the MIFs did restrict competition, they were not exempt under article 101(3). The appeals in these three sets of proceedings were heard together by the Court of Appeal, which overturned all four judgments given below. It held that there was restriction of competition and made various rulings as to the legal effect of article 101(3). The Court of Appeal remitted the article 101(3) exemption issue in all three sets of proceedings to the CAT for reconsideration in the light of the legal rulings it had made and based on the evidence adduced in all three cases. Visa and Mastercard seek to appeal the Court of Appeals decision on four grounds. AAM seek to cross appeal against the order for remittal. The Supreme Court unanimously upholds the conclusion of the Court of Appeal that the MIFs infringed article 101(1) and its legal rulings on article 101(3), dismissing the appeal on all grounds except the broad axe issue (defined below). The Court allows the cross appeal. The full Court gives the judgment. Visa and Mastercard appeal on four grounds. First, whether the Court of Appeal was wrong to find that there was a restriction of competition in the acquiring market contrary to article 101(1) TFEU and equivalent national legislation (the restriction issue). Second, whether the Court of Appeal found, and if so was it wrong in finding, that Visa and Mastercard were required to satisfy a more onerous evidential standard than that normally applicable in civil litigation, in order to establish that their MIFs were exempt under article 101(3) (the standard of proof issue). Third, whether the Court of Appeal was wrong to find that in order to show that consumers receive a fair share of the benefits generated by the MIFs, to satisfy the test under article 101(3), Visa was required to prove that the benefits provided to merchants alone as a result of the MIFs outweighed the costs arising from the MIFs, without taking any account of the benefits received by cardholders as a result of the MIFs (the fair share issue). Fourth, whether the Court of Appeal found and, if so, was it wrong in finding, that a defendant has to prove the exact amount of loss mitigated in order to reduce damages (the broad axe issue). Finally, AAM seek to cross appeal on the issue of whether the Court of Appeal was wrong to remit the AAM proceedings for reconsideration in relation to exemption under article 101(3) (the remission issue) [40] [41]. The restriction issue The restriction issue raises two issues for consideration: (i) whether the Court is bound by the Mastercard CJ decision; and (ii) if not, whether that decision ought to be followed [48]. The appellants argue that the Court of Appeal was wrong to conclude that it was bound by Mastercard CJ to find that there was a restriction of competition in the acquiring market contrary to article 101(1) TFEU and equivalent national legislation because Mastercard CJ is factually distinguishable [68] [72]. The Supreme Court concludes that Mastercard CJ is binding and the Court of Appeal was correct so to hold. The essential factual basis upon which the Court of Justice held that there was a restriction on competition in Mastercard CJ is mirrored in these appeals [93] [94]. Even if the Court were not bound by Mastercard CJ, the Supreme Court would follow it and conclude that there was a restriction on competition in the present cases. The effect of the collective agreement to set the MIF is to fix a minimum price floor for the MSC. That minimum or reservation price is non negotiable. Acquirers have no incentive to compete over it. It is a known common cost which acquirers know they can pass on in full and do so. Merchants have no ability to negotiate it down. A significant portion of the MSC is thereby immunised from competitive bargaining and is determined by collective agreement rather than by competition. By contrast, in the counterfactual, in which there is no MIF but settlement at par, the whole of the MSC is open to competitive bargaining and determined by competition [95] [104]. The Court therefore dismisses the appeal on the restriction issue [105]. The standard of proof issue On the standard of proof issue, the appellants submit that the Court of Appeal was wrong to conclude that, in relation to article 101(3), there is a specific requirement for robust and cogent evidence, which is a more onerous standard than the normal domestic civil standard of proof on the balance of probabilities, and that there is a legal requirement for facts and empirical data [106]. It is common ground that to justify the restriction on competition the burden of satisfying that the four conditions set out in article 101(3) lies on the defendant; the present issue relates to the standard of proof [107]. Visa and Mastercard submit that in the Commercial Court proceedings the judges adopted diverging views on the standard of proof [108]. The Court of Appeal considered that EU law requires cogent factual and empirical evidence to satisfy article 101(3) [109]. The Court considers that the essential complaint made by Visa and Mastercard here does not relate to the standard of proof but rather to the nature of the evidence required to meet the standard of proof in this context and, more specifically, the type of evidence needed to establish that the benefits from the MIF rules under consideration outweigh the detriments to merchants [115]. In the Courts view, article 101(3) imposes requirements as to the nature of the evidence that can discharge the burden to establish an exemption under that provision, which is imported into domestic competition law by the 1998 Act. Cogent empirical evidence is required to carry out the required evaluation of the claimed efficiencies and benefits [116]. The Court therefore dismisses the appeal on the standard of proof issue [138]. The fair share issue On the fair share issue, Visa challenges the decision of the Court of Appeal, which interpreted Mastercard CJ as meaning that in a two sided market situation such as in the present case, if the restriction causes disadvantages overall to the consumers in the market under consideration (here the merchants in the acquiring market), those disadvantages cannot be compensated by advantages to consumers in the other market (the cardholders in the issuing market), unless the two groups of consumers are substantially the same, which is not the position here [144]. The Supreme Court finds that the Court of Appeal arrived at the correct decision, albeit by different reasoning. The best available guidance from the CJEU on the application of the fair share requirement is the opinion of the Advocate General Mengozzi in Mastercard CJ, which considered that the fair share of the benefits must be received by the consumers in the same market. The Court therefore dismisses the appeal on the fair share issue [171] [174]. The broad axe issue The broad axe issue relates to the degree of precision required in the quantification of mitigation of loss where a defendant to a claim for damages arising out of a breach of competition law asserts that the claimant has mitigated its loss through the passing on of all or part of an overcharge to its customers [175]. Mastercard submitted that it must prove that the merchants passed on some of the overcharge to their customers but the quantification of the pass on did not have to be precise if precision could not reasonably be achieved [179]. The claims of the merchants in these appeals are for compensatory damages for loss caused to them by the tortious acts of Visa and Mastercard in breach of their statutory obligations under the 1998 Act [182]. In such circumstances, EU law allows a member state to lay down procedural rules governing actions that safeguard rights derived from EU law, provided the rules comply with the principles of equivalence and effectiveness. The only constraint on national law at the relevant time was the principle of effectiveness, which requires that the domestic rules do not make it practically impossible or excessively difficult to exercise rights guaranteed by EU law [188]. In the UK, pass on is an element in the quantification of damages that is required by the compensatory principle and required to prevent double recovery through claims in respect of the same overcharge by a direct purchaser and by subsequent purchasers in a chain [196] [197]. Visa and Mastercard have the burden of establishing that the merchants have recovered the costs incurred in the MSC but, once the defendants have raised the issue of mitigation, in the form of pass on, there is a heavy evidential burden on the merchants to provide evidence [216]. The degree of precision requires a balance between achieving justice by precisely compensating the claimant and dealing with disputes at a proportionate cost [217]. The law does not require unreasonable precision in the proof of the amount of the loss that the merchants have passed on to suppliers and customers [225]. The Supreme Court does not interpret the Court of Appeal as having held that the defendants had to prove the exact amount of the loss mitigated, but insofar as the Court of Appeal required a greater degree of precision in the quantification of pass on from Visa and Mastercard than from the merchants, the Court erred. As a result, the appeal succeeds on the broad axe issue [226]. The remission issue The cross appeal relates only to the AAM proceedings [227]. AAM submit that the Court of Appeal erred in remitting the AAM proceedings for reconsideration of the exemption under article 101(3). Despite reaching the correct conclusion that Mastercards defence based on article 101(3) should have been dismissed, the Court of Appeal made an order remitting the AAM proceedings to the CAT, alongside the other two sets of proceedings, for reconsideration of whether Mastercards case under article 101(3) should have succeeded in whole or in part [232] [233]. AAM submit that it was not open to the Court of Appeal to so order and to permit the issue to be re opened by Mastercard, and that it offended against the principle of finality in litigation [235]. In the Supreme Courts judgment, the Court of Appeal was wrong to allow Mastercard to re open this issue, which it had lost after a full and fair trial. It offends against the strong principle of public policy and justice that there should be finality in litigation [237]. Accordingly, AAMs cross appeal is allowed [247].

longest

Percy McDonald was diagnosed as suffering from mesothelioma in July 2012. Sadly, at the beginning of February 2014, just before the appeal in his case was due to be heard by this court, Mr McDonald died. His widow, Edna McDonald, has been substituted as respondent in the appeal. The period between diagnosis and death in Mr McDonalds case is entirely consistent with experience of this insidious disease. Survival for no more than a period of months after diagnosis is the almost invariable outcome. Mesothelioma is a form of cancer that develops from cells of the mesothelium, the protective lining that covers many of the internal organs of the body. It usually affects the pleura, the outer lining of the lungs and the internal chest wall. It is most commonly caused by exposure to asbestos. Symptoms or signs of mesothelioma may not appear until 50 years (or more) after exposure. Mr McDonald was employed by a firm known as Building Research Establishment, operated by the government. Between 1954 and March 1959 he attended Battersea power station in the course of his employment. This was for the purpose of collecting pulverised fuel ash. Between 1954 and January 1957 he was at the power station approximately twice a month. Between January 1957 and March 1959 he was there about twice every three months. The plant where the ash was collected did not contain asbestos. But Mr McDonald, while visiting the power station, went into other areas where asbestos dust was generated by lagging work. This happened particularly in the boiler house. It is suggested by the appellant that his visits to these areas took place because of curiosity on his part or because he was on friendly terms with workers employed there. At the times he was exposed to asbestos, Mr McDonald was, the appellants counsel, Mr Nolan QC, suggested, a sightseer or an interested visitor. The lagging work involved mixing asbestos powder with water in large drums in order to make a paste. It also included the sawing of preformed asbestos sections and the stripping off of old asbestos lagging. On occasions Mr McDonald walked through dried asbestos paste. The trial judge found that his exposure to asbestos was of a modest level on a limited number of occasions over a relatively short period of time [and] was not greater 7. than those levels thought of in the 1950s and 1960s as being unlikely to pose any real risk to health. The appellant is the successor body to the occupiers of the power station and, at trial, Mr McDonald alleged that those occupiers were negligent and in breach of their statutory obligations under regulation 2(a) of the Asbestos Industry Regulations 1931 and section 47 of the Factories Act 1937. He also claimed against his employers that they had been guilty of negligence. The trial judge, His Honour Judge Denyer QC, dismissed all the claims against both defendants. On appeal, the Court of Appeal allowed Mr McDonalds appeal under the 1931 Regulations but dismissed his appeal under the 1937 Act and in negligence. The appellant appeals to this court against the judgment under the 1931 Regulations and Mrs McDonald cross appeals against the dismissal of her husbands claim under section 47 of the 1937 Act. Negligence is no longer in issue. The Asbestos Industry Regulations 1931 These Regulations were made pursuant to the provisions of the Factory and Workshop Act 1901, section 79 of which provided: Where the Secretary of State is satisfied that any manufacture, machinery, plant, process or description of manual labour, used in factories or workshops, is dangerous or injurious to health or dangerous to life or limb, either generally or in the case of women, children or any other class of persons, he may certify that manufacture, machinery, plant, process or description of manual labour to be dangerous; and thereupon the Secretary of State may, subject to the provisions of this Act, make such regulations as appear to him to be reasonably practicable and to meet the necessity of the case. In a letter of 15 September 1931 the Secretary of State indicated that he would use his powers under this section and he enclosed a draft of the Regulations that he proposed to make for the protection of the workers employed in certain processes involving exposure to asbestos dust. He gave notice in the letter that he had formally certified as dangerous the manipulation of asbestos and the manufacture or repair of articles composed wholly or partly of asbestos and processes incidental thereto The letter further intimated that the Secretary of State had decided to give effect to recommendations contained in two reports, Effects of Asbestos Dust on the Lungs and Dust Suppression in the Asbestos Industry by Merewether and Price published in March 1930 and the Report of Conferences between Employers and Inspectors concerning Methods for Suppressing Dust in Asbestos Textile Factories, which had been published shortly before the Secretary of States letter was sent. That letter continued: The draft Regulations follow generally the provisions recommended in the two Reports already mentioned, with certain additions and modifications which have been made after taking into consideration observations submitted by the General Council of the Trades Union Congress. 8. Section 82(1) of the 1901 Act provided: The regulations made under the foregoing provisions of this Act may apply to all the factories and workshops in which the manufacture, machinery, plant, process or description of manual labour, certified to be dangerous, is used (whether existing at the time when the regulations are made or afterwards established) or to any specified class of such factories or workshops. They may provide for the exemption of any specified class of factories or workshops either absolutely or subject to conditions. 9. The breadth of the anticipated application of the Regulations should be noted. This subsection foreshadowed their application to a wide range of processes. It also presaged that processes etc which did not exist at the time the Regulations were made could come within their embrace when later established. The potentially wide scope of the Regulations was also reflected in section 83 of the Act which provided: . Regulations made under the foregoing provisions of this Act may, among other things . (b) prohibit, limit or control the use of any material or process; 10. This broadly based theme was continued in the text of the Regulations themselves. In the preamble it was directed that they were to apply to all factories and workshops or parts thereof in which the following processes or any of them are carried on: (i) breaking, crushing, disintegrating, opening and grinding of asbestos, and the mixing or sieving of asbestos, and all processes involving manipulation of asbestos incidental thereto; (ii) all processes in the manufacture of asbestos textiles, including preparatory and finishing processes; (iii) the making of insulation slabs or sections, composed wholly or partly of asbestos, and processes incidental thereto; (iv) the making or repairing of insulating mattresses, composed wholly or partly of asbestos, and processes incidental thereto; (v) sawing, grinding, turning, abrading and polishing, in the dry state, of articles composed wholly or partly of asbestos in the manufacture of such articles; (vi) the cleaning of any chambers, fixtures and appliances for the collection of asbestos dust produced in any of the foregoing processes. 11. The extent of the potential application of the Regulations was mitigated by a proviso to the preamble which was in the following terms: Provided that nothing in these Regulations shall apply to any factory or workshop or part thereof in which the process of mixing of asbestos or repair of insulating mattresses or any process specified in (v) or any cleaning of machinery or other plant used in connection with any process, is carried on, so long as (a) such process or work is carried on occasionally only and no person is employed therein for more than eight hours in any week; and (b) no other process specified in the foregoing paragraphs is carried on. 12. Although this proviso cut down the scope of the Regulations, it gives some insight into the width of their intended ambit. It carried the clear implication that the Regulations applied even if the main business of the factory or workshop was not the manufacture of asbestos goods. Moreover, the processes identified in the preamble, other than those listed in the proviso, were to come within the Regulations even if the work involved in them took place only occasionally or for limited periods. Also, in relation to those processes listed in the proviso, including mixing, the Regulations were to apply unless the work was carried out occasionally and no person undertook it for more than 8 hours a week. A further proviso, not directly relevant for present purposes, permitted the chief inspector of factories to suspend or relax the Regulations, if satisfied that, by reason of the restricted use of asbestos or the methods of working, they could be suspended or relaxed without danger to those employed. I say that this is not directly relevant but it is pertinent to note that one of the circumstances in which the suspension or relaxation might be authorised was that the use of asbestos was restricted. If, as the appellant claims, the Regulations applied only to the industry engaged in the manufacture of asbestos, it is difficult to see how circumstances could arise in which asbestos use within such an industry would be restricted. 13. The preamble stipulated that it was the duty of the occupier of factory or workshop premises to observe Part I of the Regulations. Regulation 2 (which was in Part I) provided: 2. (a) Mixing or blending by hand of asbestos shall not be carried on except with an exhaust draught effected by mechanical means so designed and maintained as to ensure as far as practicable the suppression of dust during the processes. (b) If premises which are constructed or re constructed after the date of these Regulations the mixing or blending by hand of asbestos shall not be done except in a special room or place in which no other work is ordinarily carried on. 14. Asbestos was defined in the Regulations as meaning any fibrous silicate mineral, and any admixture containing any such mineral, whether crude, crushed or opened. Crude asbestos was the raw mineral as shipped in containers after it had been mined. Crushed or opened material referred to its condition after it had undergone processes preparatory to its use. The Regulations defined preparing as meaning crushing, disintegrating, and any other process in or incidental to the opening of asbestos. The background to the1931 Regulations 15. The parties are agreed that the Merewether and Price Report forms part of the background against which the 1931 Regulations were made and is therefore indispensable to any examination of their ambit. The respondent claims that further material considerations include (i) the relevant provisions of the 1901 Act; (ii) the Secretary of States certification pursuant to section 79; (iii) the processes listed in the preamble; and (iv) the definition of asbestos in the Regulations. The appellant contends that the Report on Conferences and the discussions which led to it also played a significant part in the shaping of the terms of the 1931 Regulations and that these must also be considered. It has not been suggested by the respondent that this report should not be taken into account. 16. The appellant points to two other sources which, it claims, provide material germane to a consideration of the intended scope of the Regulations. The first of these is a report entitled Problems arising from the use of Asbestos Ministry of Labour HM Factory Inspectorate November 1967 (36 316). This suggested that the 1931 Regulations [did] not apply to lagging and insulation operations using asbestos. The respondent objects to any reference to this document on the ground that it did not feature in the case until the hearing before this court. The second source identified by the appellant consists of material relating to the Parliamentary history of the Regulations. This material demonstrates, the appellant argues, that Parliaments perspective was that the 1931 Regulations applied only to the asbestos industry. The respondent contends that it is not permissible to refer to this material because the conditions prescribed by Pepper v Hart [1993] AC 593 as to the admissibility of statements made in Parliament are not satisfied. It is also submitted that the references in Hansard do not, in any event, assist in determining the scope of the Regulations. Section 47(1) of the Factories Act 1937 17. Section 47(1) of the 1937 Act provided: In every factory in which, in connection with any process carried on, there is given off any dust or fume or other impurity of such a character and to such extent as to be likely to be injurious or offensive to the persons employed, or any substantial quantity of dust of any kind, all practicable measures shall be taken to protect the persons employed against inhalation of the dust or fume or other impurity and to prevent its accumulation in any workroom, and in particular, where the nature of the process makes it practicable, exhaust appliances shall be provided and maintained, as near as possible to the point of origin of the dust or fume or other impurity, so as to prevent it entering the air of any workroom. 18. A number of elements is required to establish liability under the subsection. Firstly, there must be a process which generates dust or fume or other impurity. Secondly, the dust or fume etc must be of a character or extent as to be likely to be injurious or offensive. Thirdly, the dust, fume or other impurity must be injurious or offensive to those employed. But by way of alternative to the requirement that it be injurious or offensive, if the dust given off is substantial this will be sufficient to ground liability. Finally, the measures to be taken in order to protect against inhalation of the dust, fume or other impurity must be practicable. 19. Mr McDonald had relied on the second limb of the subsection, ie that the amount of asbestos dust that was given off in the areas of the power station where he had been exposed to it was substantial. The first issue between the parties on this aspect of the case was whether it was sufficient that the volume of the dust at the time that it was initially generated was substantial, irrespective of its concentration at the time that Mr McDonald inhaled it or whether it had to be shown that at the time he was exposed to and inhaled it, there was a substantial quantity of dust. The appellant argued that the concentration of dust had to be substantial at the moment of exposure and inhalation. The respondent submitted that, if the quantity of dust that was initially liberated was substantial, it was not required under section 47(1) to show that, at the time Mr McDonald was exposed to it, the amount of the dust was substantial; it was enough that, at the point of its being given off, it could be so described. 20. The appellant also argued that no duty was owed to Mr McDonald because he was not a person employed for the purposes of the subsection. On this issue the respondent claimed that, during the time that he was exposed to the dust, Mr McDonald was a person employed. It was submitted that to interpret section 47(1) so as to limit its application to workers actually engaged in the process of producing the dust or fume would greatly restrict the scope of the provision and would exclude from protection many who would be affected by the process. Moreover, it would have been a simple matter to confine the application specifically to those actually engaged in the production of the dust or fume by an express provision to that effect. An example of such an explicit provision was to be found in section 49 of the 1937 Act dealing with protection for eyes. The application of the 1931 Regulations 21. The principal argument of the appellant was that the 1931 Regulations, in their original conception and subsequent application, were focused on the asbestos industry and those working in it. The purport of the appellants submission on this point was that section 79 of the 1901 Act envisaged the designation of a dangerous industry rather than proscription of the use in industry generally of dangerous material. Only when a trade or industry was formally nominated as dangerous was it to be subject to the Regulations. That submission, it was claimed, derived support from the terms of section 82 which focused on factories and workshops where the dangerous industry was carried on. It was also sustained, Mr Nolan argued, by the title of the Regulations, The Asbestos Industry Regulations and the definition of asbestos. That definition referred to asbestos in its unprocessed ie its raw, mineral condition. It did not comprehend processed asbestos products such as asbestos insulation. It was claimed that the exclusive focus of the Regulations on the asbestos industry was also indicated by subparagraph (v) of the preamble relating to sawing, grinding, turning, abrading and polishing in the dry state, of articles composed wholly or partly of asbestos in the manufacture of such articles. The express inclusion of the qualification that these processes were confined to the manufacture of asbestos products made clear, it was said, that the subject of the 1931 Regulations was the asbestos industry and the production of materials within that industry, rather than the use of asbestos products in the work of other industries. 22. 23. For the respondent it was argued that the terms of section 79 and the certification by the Secretary of State indicated that the Regulations were to apply whenever and wherever a defined process was carried on in a factory or workshop. This was in keeping with the mischief which Merewether and Price had identified and the remedy they had proposed. There was no reason to adopt a narrow definition of asbestos industry and on that basis restrict the application of the Regulations. The term asbestos industry in the title was used in the wide sense of any industry where one or more processes referred to in the preamble was carried on. 24. The breadth of the terms of the preamble was considered by the Court of Appeal in Cherry Tree Machine Co Ltd v Dawson sub nom Jeromson v Shell Tankers (UK) Ltd [2001] EWCA Civ 101, [2001] ICR 1223. Hale LJ, delivering the only substantive judgment with which Mantell LJ and Cresswell J agreed, pointed out in para 7 that the preamble had made it clear that the Regulations applied to all factories and workshops in which the listed processes took place. She also adverted to the import of the proviso in the preamble. She held (at para 12) that the trial judge was plainly right to conclude that, for the exemption in the proviso to apply, it was required both that the work was carried on only occasionally and that no person was employed at that work for eight hours or more in any week. That conclusion made it distinctly difficult for the application of the Regulations to be confined to factories and workshops where asbestos was manufactured. Sporadic or occasional work involving the manufacture of asbestos was inherently unlikely to be a feature of factories where that activity was the sole or primary undertaking. On this account Hale LJ declined to follow the decision in the Scottish case of Watt v Fairfield Shipbuilding & Engineering Co Ltd 1999 SLT 1084. In that case, Lord Gill had felt that it was possible to give the proviso a satisfactory meaning, notwithstanding his conclusion that the 1931 Regulations applied only to the asbestos industry. Hale LJ was not persuaded that this was possible, saying at para 21: It is however very difficult to imagine a factory or workshop whose main business was producing asbestos or asbestos products to which the exemption could possibly apply, given that only certain processes, infrequently carried on, are exempted and only then if none of the other defined processes is carried on in the same factory. 25. The argument that the Regulations only applied to the asbestos industry and to the manufacture of asbestos had also been accepted in the earlier case of Banks v Woodhall Duckham Ltd, an unreported decision of the Court of Appeal which had been delivered on 30 November 1995. The Court of Appeal in Cherry Tree distinguished that case, Hale LJ commenting (at para 25) that the observations of the court in Banks were not essential to the determination of the case because the trial judge had been unable to make findings of fact as to the extent to which any of the defendants had exposed the claimant to asbestos and what if any damage flowed from any such exposure. 26. The appellant challenged the correctness of the decision in Cherry Tree. It was submitted that too great an emphasis had been placed on the preambles description of the processes and insufficient regard had been had to the underlying theme of the 1901 Act and the 1931 Regulations. This was that an industry was to be regulated rather than processes involving the use of asbestos. In particular, the preventive measures suggested in the Merewether and Price Report were directed specifically towards the suppression and control of the dust involved in manufacturing processes, and steps to be taken in relation to those employed in the industry (p 17 of the Report). 27. The central thesis of the appellants case rests on the notion that there was, at the time the 1931 Regulations were made, a clearly identifiable asbestos industry; that this industry was engaged solely in the manufacture of asbestos; and that it was the intention of the Secretary of State, in making the Regulations to confine their application to that closely defined industry. Several reasons can be given for rejecting that argument, the first and most prosaic being that, if that had indeed been the Secretary of States aim, it could have been easily achieved by an unequivocal statement to the effect that the Regulations only applied to the asbestos manufacturing industry. So far from stating that, the Regulations made it prominently clear that all factories and workshops in which certain specified processes are carried out are covered by the Regulations. The emphasis immediately falls on the processes rather than the nature of the industry. And this is entirely logical. If processes other than those involved in the manufacture of asbestos were known to give rise to the risk of developing fibrosis (as they were at the time the Regulations were made) why should they be excluded from their ambit? 28. Secondly, the Merewether and Price Report, on which the appellant places such weight, did not focus exclusively, in my view, on the asbestos manufacturing industry. The first (and more important) part of the Report is devoted to an investigation of whether workers exposed to asbestos were at risk of developing pulmonary fibrosis. That investigation had been commissioned by the Home Office following the discovery, in February1928, of a case of non tubercular fibrosis of the lungs in an asbestos worker, of sufficient severity to necessitate treatment in hospital (Seilers case). As the covering letter enclosing the Report to the Home Secretary makes clear, the investigation established that the inhalation of asbestos dust over a period of years results in the development of a serious type of fibrosis of the lungs. It was not suggested (nor could it have been) that inhalation of asbestos dust sufficient to cause fibrosis could only occur in the course of asbestos manufacture. 29. The first part of the Report was not focused on the asbestos industry as such, therefore, but on the propensity of exposure to asbestos to cause fibrosis. As it happens, workers in the textile branch of the asbestos industry were chosen for study because their exposure was to pure, or nearly pure, asbestos. Workers in other parts of industry had exposure to a mixture of dusts, of which asbestos was one. It was considered necessary to choose those whose exposure was to asbestos alone in order to evaluate the effect of asbestos dust. At p 7 of the Report, however, the authors highlighted the considerable number of workers exposed to the influence of mixed dusts of which asbestos was but one. As Judge LJ said, speaking of the Merewether and Price Report in Maguire v Harland & Wolff plc [2005] EWCA Civ 1, the research was confined to asbestos textile workers, but [the Report] explained that workers in other industries, exposed to asbestos dust, were also at risk (para 23). 30. The choice of workers in the asbestos textile industry for investigation does not betoken a view on the part of the authors of the Report that protection for that category of workers was alone required. They were chosen because they were known to be exposed to asbestos dust and, since the purpose of the investigation was to examine whether there was a connection between asbestos dust and fibrosis, it was logical to focus on them. But the critical finding was that exposure to asbestos dust gave rise to the serious risk of grave illness. Confronted by that finding and by the statement that workers in other areas of industry were exposed to asbestos, there is no obvious reason that the Secretary of State should decide to confine the application of the Regulations to the manufacturing arm of the asbestos industry and to leave unprotected the considerable number of other workers exposed to a mixture of dusts including asbestos. 31. While the second part of the Report dealt with the suppression of dust in the asbestos industry, it did not suggest that precautionary measures need only be taken in relation to the manufacture of asbestos. It would be illogical if it had done so in light of the central finding of the first part that prolonged exposure to asbestos, in whatever circumstances that occurred, carried a grave risk of serious illness. Moreover, the second section of the Report looked separately at textile and non textile processes involving use of asbestos materials. The latter included electrodes with an asbestos covering and miscellaneous goods containing a proportion of asbestos. These processes were recognised by the authors of the Report to create significant exposure to asbestos and thereby a risk to health. At p 19 the authors stated: Apart from manufacture, certain work is carried on in premises subject to the Factory and Workshops Acts, as well as in other premises, which involves use or manipulation of asbestos or products containing it. The insulating of boilers, pipes, engines and parts of ships is the most important. Much of this work is done on board ship by contractors who employ a considerable outdoor staff. It is therefore unwise to dwell too heavily on some of the wording of the Regulations themselves in order to try to construct an exclusive emphasis on the manufacture of asbestos. It is quite clear that the risks of ill health through exposure to asbestos other than in the course of its manufacture had been recognised. Moreover, it is unsurprising that the Regulations should refer to many aspects of manufacture because the Merewether and Price Report had 32. dealt with asbestos textile workers. But that circumstance alone does not justify the view that it was intended that the Regulations should apply only to the manufacture of asbestos and that the risks arising from other forms of exposure should be ignored. 33. The Report on Conferences between Employers and Inspectors concerning Methods for Suppressing Dust in Asbestos Textile Factories obviously was concerned with that area of the industry. While the Secretary of State had regard to that report, there is no reason to suppose that, simply because it dealt only with that side of the industry, the risks arising from exposure in other circumstances would be overlooked. 34. A third reason for rejecting the appellants claim that the Regulations were designed to apply to the manufacturing processes of the asbestos industry is that it is at least questionable whether a selfcontained asbestos industry concerned exclusively with manufacturing could be said to exist in isolation from the use of asbestos in other factory settings. As Merewether and Price themselves observed (at p 18 of their Report), the asbestos industry had developed greatly in the years before the report was issued and it continued to expand rapidly mainly because of the demands of the motor, electrical, engineering and building industries and of the increasing attention now paid to the insulation of steam plant to promote fuel economy. 35. Unlike many other manufactured products, asbestos frequently required to be worked, manipulated, mixed and transformed after the supply of the raw material to the customer. Merewether and Price referred to this at p 19 in the passage quoted at para 31 above. It appears to me highly doubtful that the Secretary of State would have concluded that insulation companies which were not engaged in the manufacture of asbestos but whose workers were daily exposed to asbestos while manipulating it for application in various premises should not be regarded as part of the asbestos industry. And, indeed, in his certification letter, the Secretary of State expressly stated that he had formally certified as dangerous the manipulation of asbestos as well as the manufacture or repair of articles composed wholly or partly of asbestos and processes incidental thereto. In this context, it is appropriate to consider the Parliamentary material relied on by Mr Nolan as indicating the governments intention that the 1931 Regulations should apply only to the asbestos manufacturing industry. The first of these was a reply given on behalf of the Ministry of Labour on 13 March 1930 to a question concerning the number of men and women employed in the asbestos industry and insured for unemployment. The reply given was as follows: 36. Separate statistics of the number of insured persons in the asbestos industry are not available, as that industry is included with others in the group Textile industries not separately specified. At the population Census of 1921, the number of occupied persons classified as belonging to the asbestos industry in Great Britain included 2,550 males and 1,327 females, aged 12 and over. (Hansard (HC Debs) Col 1520 W) 37. On 15 November 1934, in answer to a question about the number of deaths from asbestosis, the Home Secretary said: About 60 deaths have been brought to the notice of the Department and after investigation are all attributed by the Senior Medical Inspector of Factories to exposure incurred previous to the Asbestos Industry Regulations of 1931 which required elaborate precautions. Special inquiry in 1932 as to other risks in warehouses and certain other processes revealed no need for any extension of the regulations, but their effectiveness will continue to be closely watched. (Hansard (HC Debs) Col 2122) 38. Finally, Mr Nolan drew our attention to a statement made on 5 December 1966 by the Minister for Labour to the effect that he was revising the Asbestos Industry Regulations 1931, and intended to extend their application to all industries and processes in which asbestos is used. (Hansard (HC Debs) Col 197 W). In the well known passage of his speech in Pepper v Hart [1993] AC 593, 634 Lord Browne Wilkinson set out the circumstances in which Parliamentary material could be used as an aid to construction of legislation in the following terms: 39. reference to Parliamentary material should be permitted as an aid to the construction of legislation which is ambiguous or obscure or the literal meaning of which leads to an absurdity. Even in such cases references in court to Parliamentary material should only be permitted where such material clearly discloses the mischief aimed at or the legislative intention lying behind the ambiguous or obscure words. In the case of statements made in Parliament, as at present advised I cannot foresee that any statement other than the statement of the Minister or other promoter of the Bill is likely to meet these criteria. 40. Leaving aside the question of whether the Regulations are ambiguous, it is quite clear that none of the statements to which the appellant referred partakes of the quality required. Quite apart from the fact that none bore directly on the issue of the application of the Regulations to an asbestos manufacturing industry only, none could be said to disclose the mischief aimed at or the legislative intention underlying them. And, of course, two of the statements post dated the making of the Regulations and are, therefore, at most, an expression of view as to how they should be construed rather than a true guide to legislative intent. The respondent is undoubtedly correct, therefore, in the claim that the conditions for the admissibility of the Parliamentary material are not present in this instance and is also correct in the assertion that, in any event, the statements do not assist in giving any real insight into the legislative intention in making the Regulations. 41. For essentially the same reasons the 1967 report (referred to in para 16 above) cannot be regarded as an authoritative guide to the proper construction of the Regulations. This represents, at best, one possible view as to the extent of their application. The statement that the Regulations do not apply to lagging and insulation operations using asbestos is not elaborated upon nor is any reasoned support for it provided. It also contrasts with the memorandum dated 6 September 1949 from the chief safety officer of the appellants predecessors to regional safety officers, in relation to the lagging of steam pipes in generating stations. In it the view of the Deputy Chief Inspector of Factories is recorded as being that the 1931 Regulations applied to the mixing of asbestos in power stations but did not apply to the removal of old lagging or the application of insulation. 42. The next reason for rejecting the appellants principal argument is that given by Hale LJ in the Cherry Tree case, namely, that the first proviso in the preamble is not only otiose but impossible to explain if the application of the Regulations is confined to the manufacture of asbestos. An industry devoted exclusively to making this product simply could not avail of the proviso. It could have no relevance if the appellants contended for interpretation of the Regulations is correct. The fact that it was included points unmistakably to the conclusion that it was envisaged that the Regulations would apply to processes other than the manufacture of asbestos. Allowing an exemption for work with asbestos which was occasional and carried on for no more than 8 hours per week simply does not make sense if the Regulations were only to apply to the asbestos industry as the appellant has defined it. This proviso flatly contradicts the appellants claims as to the scope of application of the Regulations. 43. 44. It is, of course, true that, if the Regulations are held to apply to all factories at which any of the processes is carried on, regulation 2(b) may appear somewhat anomalous. To require mixing or blending by hand of asbestos to be carried on in a special room or place in which no other work is ordinarily carried on might appear to cast a considerable burden on employers engaged in lagging operations. The respondent confronts this seeming incongruity head on by saying that since mixing work, in its wide sense, gave rise to dust to which workers were exposed other than those carrying out the work, it was a sensible and practical measure to stipulate that mixing should be undertaken in a separate room or place and, pursuant to regulation 2(a), provided with a suitable exhaust draught. I am not convinced that this provides a complete answer to the claim that regulation 2(b), if applied to lagging operations and those working in their vicinity, imposes a duty that would in practical terms be very difficult to fulfil. Be that as it may, I am of the firm view that regulation 2(b), if applied to all processes listed in the preamble, is more readily explicable than would be the exemption in the proviso if the regulation is confined to asbestos manufacture only. While, therefore, I acknowledge that the terms of regulation 2(b) lend some support to the notion that the Regulations were designed to be more restrictive in their application, I do not consider that this is of sufficient moment to displace the plain meaning to be given to the preamble in applying the Regulations to all of the processes listed or to counteract the more obvious anomaly of the existence of an exemption for the asbestos manufacturing industry which plainly had no relevance to it. Mixing 45. Active dispute arose as to whether the term mixing in the Regulations should be given a specialised, technical, or its ordinary, meaning. In support of its argument that it should be given a restricted, technical meaning, the appellant conducted a close textual analysis of the Merewether and Price Report, citing instances of where the term had been used in conjunction with other processes of manufacture. Reliance was also placed on the Report on Conferences where it was clear, the appellant claimed, that the expression mixing was used in the technical sense of mixing raw asbestos as a preparatory step to its use in the manufacture of asbestos products. In the Merewether and Price Report at p 11, mixing is first in a list of processes which includes crushing, opening and disintegrating. And at p 21 the process of mixing is identified in the same context as the breaking, crushing, disintegrating, opening and grinding of asbestos and before reference to the sieving of asbestos. This, the appellant claims, is a reference 46. to the preparatory steps for use of asbestos mineral in product manufacture, rather than mixing asbestos to create a paste. This claim is fortified, the appellant says, by the reference on p 31 of the Report to the dusty process of hand mixing incidental to opening (ie manufacturing) processes. 47. The appellant argues that the recommendations contained in the Merewether and Price Report correlate directly to the classification of processes in the preamble to the 1931 Regulations. Thus the first recommendation (relating to exhaust ventilation at dust producing points) was the foundation for regulation 1. The reference in this recommendation to the fact that such measures have not been applied to hand work and that special difficulties remain to be overcome in some cases eg . mixing . clearly referred back to mixing identified on pp 21 and 31 of the Report. The recommendation that, unless the problem was surmounted, there should be general ventilation of a high standard applied so as to draw the dust laden air away from the worker became regulation 2(a), the appellant claimed, and therefore applied specifically to mixing or blending by hand with this clear technical meaning. 48. These arguments are founded on the premise that the Merewether and Price Report and the Report on Conferences were translated directly to the provisions in the Regulations. This is a false premise for two reasons. First, the letter of 15 September 1931 indicated that, while the Regulations would follow generally the recommendations made in the two reports, certain additions and modifications had also been made. Secondly and more importantly, the Merewether and Price Report and the Report on Conferences were based on the investigation of the specific conditions which had been addressed by both reports. As earlier explained, Merewether and Price had isolated a particular group of asbestos workers for the precise reason that they wished to evaluate the effect of exposure to asbestos dust alone rather than the effect of exposure to mixed dusts including asbestos. The Report on Conferences was concerned with methods for suppressing dust in asbestos textile factories. But the consideration of the Secretary of State could not be constrained by the restricted basis on which the reports were prepared. He should not have and must be presumed not to have ignored the risk to those who worked with asbestos, other than in the manufacturing process, that the Merewether and Price Report had clearly identified. 49. Although Merewether and Price had, for understandable reasons, chosen workers whose activities were confined to the manufacture of asbestos, the significance of their findings went well beyond the impact on that restricted category of employees. In particular, it was well known, at the time that the Regulations were made, that mixing of asbestos to create a paste was a regular feature of lagging. And Merewether and Prices findings, properly understood, pointed clearly to the risk that chronic exposure to asbestos would entail, whatever the circumstances in which it occurred. If it had been intended to exclude from the ambit of the Regulations mixing for the purpose of creating a paste for lagging, this would have been, in light of contemporaneous knowledge, a surprising outcome. In any event, it would have had to be made explicitly clear and it was not. I am satisfied, therefore, that the term mixing in the Regulations should not be given the restricted, technical meaning for which the appellant contends and that it should be taken to cover mixing asbestos powder with water such as occurred in this case. The appellants secondary argument 50. The appellant argued alternatively that, even if the Regulations covered mixing of asbestos to prepare a paste for lagging, they did not apply to someone such as Mr McDonald because he was not employed in the dangerous trade which had been certified by the Secretary of State under section 79 of the 1901 Act. The appellant submitted that the Regulations could not have application wider than the statutory power under which they had been made and that a side note to section 79 stated that the power was to make regulations for the safety of persons employed in dangerous trades. 51. Mr Nolan acknowledged, however, that the House of Lords had held in Canadian Pacific Steamships Ltd v Bryers [1958] AC 485 that the section 79 power was a wide one and entitled the Secretary of State to make regulations which could create a statutory duty to protect persons not employed in the process regulated (in that case a regular crew member of a ship undergoing repair in dry dock). The nature and extent of any duty under regulations made pursuant to the section 79 power therefore depended on the terms of the particular regulations. 52. Although there was no express provision in the Regulations which restricted their application to persons employed in the process of mixing asbestos for lagging, the appellant argued that it was implicit that the duty was so limited, firstly because that was in accord with the structure of the Regulations, which was to prescribe precautions to be taken in relation to each of the processes stipulated and, secondly because the mixing process was one of those referred to in the first proviso of the preamble. Alternatively, if the protection extended beyond those who were actually involved in the processes, it did not cover someone who, like Mr McDonald, was not actually employed in the areas where the processes were taking place but was merely a casual visitor to those areas. 53. I do not accept either of these arguments. The fact that precautions are prescribed in relation to each of the processes involved says nothing to the question of whether someone has to be involved in the actual process or may be incidentally exposed to the dust or fume which the process generates. It would be remarkable if the group to be protected was confined to those who were carrying out the process but those who were at risk from exposure because of their proximity to it should remain unprotected. Given that the Canadian Pacific case had established that section 79 empowered the Secretary of State to make regulations which afforded protection to workers not involved in the process, the essential question is whether the 1931 Regulations, as made, had availed of that opportunity. Where the risk of injury arises from inhalation of dust or fumes (and, of their nature, processes which generate these do not discriminate as to who inhales them), there does not appear to me to be any logical reason to exclude those employees who are liable to be affected by exposure solely because they do not actively work on the processes. 54. Merewether and Price had adverted directly to this issue at p 20 et seq of their Report, stating that within the same workroom there could be several different processes carried on, each producing dust containing asbestos. The Report recognised that a worker might be exposed to harmful dust created by a process he was not engaged in: In many works several processes are carried on in the same room. In the absence of effective means of preventing escape of dust into the air, many workers are subjected to a risk from which they would otherwise be immune, or to a greater risk than that arising from their own work. 55. As Mr Allan QC for the respondent pointed out in his submissions on section 47 of the 1937 Act, many processes within a factory are fully automated. It could not have been Parliament's intention, he argued, that, where a fully automated process was producing dust or fume, no workers exposed to that dust or fume were protected by the section. For reasons that I will give in the next section of the judgment, I accept that submission. Using the same basis of reasoning I consider that the Secretary of State should be taken to have been principally concerned with protecting workers who were liable to be exposed to asbestos, rather than with confining protection to those whose job it was to carry out the processes which generated the risk of exposure. 56. The fact that the mixing process was referred to in the first proviso of the preamble does not sound directly on whether the Regulations should extend to employed persons who are not actively involved in that process. The 57. exemption available is perfectly understandable and workable if the Regulations apply to workers involved in that process and others who, by reason of their proximity to it, are liable to inhale the dust or fume that it generates. I shall deal with the appellants argument in relation to the claim that Mr McDonald was not a person employed but merely a casual visitor or sightseer in the part of the judgment dealing with section 47 of the 1937 Act, to which I now turn. The possible application of section 47 58. The respondent has accepted that, in order to establish that there has been a breach of statutory duty based on the second limb of section 47(1), it must be shown that: (1) the dust was given off in connection with a process carried on in the power station; (2) Mr McDonald was a person employed within the meaning of the section; (3) the quantity of dust when given off was substantial; and (4) Mr McDonald inhaled dust given off by the relevant process. The appellant agrees with this formulation except in relation to the third condition. Mr Nolan contends that it must be shown that not only was the quantity of dust substantial at the point that it was generated by the process, it must be substantial at the point of inhalation. I shall consider each of these in turn. Was the dust given off in connection with a process? 59. The appellant submitted that lagging operations were not part of the process carried on at Battersea power station. That process was, the appellant claimed, the generation of electricity. Mr Nolan relied on the judgment of Stuart Smith LJ in Banks where he accepted an argument that the lagging of pipes that may have given rise to dust was not a process being carried on in the factory, which was the manufacture of steel. In Nurse v Morganite Crucible Ltd [1989] AC 692 the House of Lords considered the meaning of process in section 76(1) of the Factories Act 1961 and the Asbestos Regulations 1969. Lord Griffiths stated at 704: The Divisional Court in giving leave to appeal to your Lordships House certified the following point of law of general public importance: 60. Whether for the purposes of the Factories Act 1961 and Regulations thereunder process carried on in a factory means a manufacturing process or other continuous and regular activity carried on as a normal part of the operation of the factory. My Lords, I am not prepared to answer the question in this form because the word process is scattered throughout many sections of the 1961 Act, and it appears in many regulations made thereunder. Your Lordships have not had the opportunity to consider the meaning to be attached to process wherever it appears and it is possible that it has different meanings in different contexts. I would confine my opinion to the meaning of the word process where it is used in the 1969 Regulations and I would answer the certified question by saying that where the word process is used in the Regulations it means any operation or series of operations being an activity of more than a minimal duration. 61. Although Lord Griffiths specifically confined his opinion as to the meaning of process to its use in the 1969 Regulations, it is clear that he rejected (at least implicitly) any notion that, to be a process in a factory, an activity had to be integral to the principal output of the enterprise. In the Nurse case the business of the factory was the manufacture of crucibles. Asbestos was not used for any purpose directly associated with that product. If an argument akin to that presented by the appellant in the present case had been accepted in Nurse that would have disposed of the appeal. It did not. And it did not because it was not necessary that, in order to be an activity in connection with a process, it had to be shown that it was directly involved with the manufacture of the end product of the factory. In Brophy v J C Bradfield & Co Ltd [1955] 1 WLR 1148 the plaintiffs husband had been overcome by fumes from a boiler used to heat the factory. It was claimed that the lack of ventilation in the boiler room constituted a breach of sections 4 and 47 of the Factories Act 1937. The Court of Appeal held that this was not a process within the meaning of those sections. At p 1153, Singleton LJ dealt with the point pithily when he said: 62. upon the facts it does not appear to me that the boiler room was a workroom within the meaning of section 4 (1) of the Act or that the fumes were generated in the course of any process or work carried on in the factory. This was a boiler used for 63. heating the factory and I do not think that that section applies to the facts of the present case. In Owen v IMI Yorkshire Copper Tube, an unreported decision of Buxton J delivered on 15 June 1995, the judge felt that the decision in Brophy could be explained on the basis that when the fumes came from the factory heating supply and not from any part of the manufacturing process it was not a part of the process carried on in the factory. For my part, I would not distinguish Brophy on that basis. I consider that it was, on this point, wrongly decided. A process in a factory should not be confused with the product that is manufactured. In factories all manner of processes are carried on which contribute to the ultimate manufactured product in varying degrees of closeness. Thus, for instance, the heating system in Brophy was not required, in the sense of making a direct contribution to the manufacture of tents and canvas goods (which was the business of the factory). But a heating system was doubtless required in order that the manufacture of those goods could take place. 64. The words in section 47(1), a process carried on in any factory should be given their plain and natural meaning. To suggest that they import some intimate connection with the manufacture of a product introduces an unnecessary and unwarranted gloss on the subsection. If it is a process that is a normal feature of the factorys activity, it is a process for the purposes of the legislation. I would therefore hold that the lagging work which Mr McDonald encountered in the power station constituted a process for the purposes of section 47 and that the first condition necessary to show breach of subsection (1) of that section has been met. Was Mr McDonald a person employed? 65. On the question of whether Mr McDonald was a person employed, the Court of Appeal decided that he was not, either in the sense of being employed at the factory or in the process of handling asbestos McCombe LJ at para 59 and the Lord Dyson MR at para 107. 66. As Mr Allan pointed out, an interpretation of the section which restricts its application to workers engaged in the process producing the dust or fume would greatly curb the scope of the provision and would exclude from protection many workers affected by exposure to the substances. And, as he also submitted, where the purpose of a provision is to protect the health of workers, a restrictive interpretation should not be adopted unless the wording compels it Harrison v National Coal Board [1951] AC 639 per Lord Porter at 650. The wording of the section does not compel a restrictive application. For the reasons given in paras 27 and 53 55 above, I consider that, in approaching the interpretation of this subsection, the emphasis should be on the need for protection rather than on involvement in the process. One could perhaps understand a more restricted approach where the danger was inherent to the process or where there was a special risk to those actively involved in the process but that is not the case here. 68. 67. Section 49 of the 1937 Act provides an example of such a special risk. That section empowered the Secretary of State to make regulations in relation to a process which involved a special risk of injury to the eyes from particles or fragments thrown off in the course of the process, and to require that suitable goggles or effective screens should be provided to protect the eyes of the persons employed in the process. The rider that the regulations should be targeted at those employed in the process in that instance is logical, given that the risk can be expected to arise only for those who are actually involved in the process but the same cannot be said for dust or fumes which are liable to be inhaled by any who encounter them. The absence from section 47 of a similar rider to that found in section 49 is significant. It reflects the recognition that the risk of exposure extends beyond those who are involved in the process of generating the dust or fume which can cause injury. In Morrison v CEGB, an unreported decision of 16 March 1986, Rose J held that section 63(1) of the Factories Act 1961 (the equivalent of section 47(1) of the 1937 Act) only extended protection to those engaged in the process. He held that if it had been intended to extend the protection to those working in the factory generally, then the section could have been so worded. It does not appear that Rose J was referred to section 65 of the 1961 Act (the equivalent of section 49 of the 1937 Act). In the later case of Owen v IMI Yorkshire Copper Tube Buxton J considered both sections and reached the opposite conclusion to that of Rose J. He gave five reasons for arriving at that conclusion, four of which I agree with and find compelling. They are these: (i) the phrase in connection with any process carried on refers to the dust and fume produced, not to the person operating that process; (ii) the effect of section 63 was to prohibit accumulation of dust or fume in any workroom at all, and not merely in the workroom where the process producing them was carried out; (iii) comparison with section 4 of the 1961 Act showed that section 63 provided the same ambit of protection as section 4 which, in material part, provided that adequate ventilation of each workroom, and the rendering harmless, so far as practicable, of all fumes, dust etc generated in the course of any process or work carried on in the factory as may be injurious to health; (iv) since the duty imposed by section 63 was to prevent accumulation of dust or fume, the protection which it was designed to achieve 69. must extend to all employed in the workroom, not just those engaged in the process. In the Court of Appeal, the decision of Buxton J in Owen is referred to only en passant at para 49 and in a footnote to para 56 of McCombe LJs judgment. The learned Lord Justice and the Master of the Rolls preferred to follow the decision in Banks on this question. Stuart Smith LJ in Banks had adopted the line of reasoning of Rose J in Morrison. Although he was aware that Buxton J had disagreed with Morrison in his judgment in Owen, Stuart Smith LJ indicated that he had not seen the judgment in the latter case. He concluded that the words persons employed in section 47 of the 1937 Act related back to the earlier words, in connection with any process. This he found to be the natural reading of the words. I do not agree. There is no reason to import, in effect, the earlier words as a qualification to the plain and simple expression, the persons employed. As Buxton J pointed out, this would have the effect of creating a significant gap in the cover of protection for workers who might, in the course of their employment, inhale dangerous substances and be at risk of grave illness in consequence. Quite why the creation of such a significant gap should represent the intention of the legislature was not addressed or explained by Stuart Smith LJ nor, with respect, by the Court of Appeal in the present case. 70. Nor did Stuart Smith LJ explain, although he adverted to it, why the contrast between sections 47 and 49 of the 1937 Act did not point clearly to the former section being interpreted more widely. For the reasons given in para 67 above, I consider that this divergence is significant and clearly betokened an intention that the application of section 47 should extend to those employed persons liable to be affected by the dust or fume, not merely to those employees who were responsible for producing those substances. 71. But if the section applied to persons employed generally, did it apply to Mr McDonald who was not employed by the occupiers of the power station and who did not require to go to the areas where he was exposed to asbestos in order to fulfil the requirements of his own employment? In Massey Harris Ferguson (Manufacturing) Ltd v Piper [1956] 2 QB 396 the Divisional Court held that persons employed where that expression was used in section 60 of the 1937 Act included not only servants of the occupier, but any other person who might be called on to do work in the factory, including a painter employed by an independent contractor. At p 401, Lord Goddard CJ said, The test is whether a person is employed in the factory, not whether he is employed by the occupier. This approach was approved by the House of Lords in the Canadian Pacific case see Viscount Kilmuir at 504. On this basis, it was unnecessary for Mr McDonald to show that he was employed by the occupiers of the factory. The fact that he was employed by a different organisation is irrelevant to the application of the subsection to his case. Casual visitor 72. What of the circumstance that Mr McDonald was not required to go to that part of the factory where he inhaled the dust which led to the development of mesothelioma? The answer is supplied, I believe, by the decision of the Court of Appeal in Uddin v Associated Portland Cement Manufacturers Ltd [1965] 2 QB 582. In that case it was held that section 14 of the 1937 Act applied where a workman in the factory went to a part of the premises where he had no authority to go and his arm was caught in a revolving shaft. At 593E Lord Pearce said, there is nothing to justify the gloss that an employed person is to be protected only so long as he is acting within the scope of his employment. The suggestion that Mr McDonald was acting within the scope of his employment while in the areas where pulverised fuel ash was collected and stepped outside that scope as soon as he crossed the threshold of another room in the factory is fanciful. I consider that the second condition to establish breach of section 47(1) has also been met. Substantial quantity at time of giving off or inhalation? 73. The third condition of the subsection that arises in the present case is that a substantial quantity of dust be present, on the appellants case at the time of inhalation, and, on the respondents, at the time that it was given off. Resolution of the conflict between these two positions must begin with a close examination of how the requirement is framed in the subsection itself. The duty to take all practicable measures is triggered when there is given off any injurious or offensive dust or fume or any substantial quantity of dust of any kind. The subsection does not stipulate that the quantity of dust must be substantial at the point of inhalation. The text of the provision therefore favours the respondents claim as to its proper interpretation. It is to be presumed that the greater the quantity of dust given off, the greater the chance that it will be inhaled before it is dissipated. It is therefore not at all surprising that practicable measures should be required to be taken at the point at which the dusts or fumes are given off. On that account also, the respondents position is to be preferred. That interpretation as to the effect of the subsection also appears to have been accepted by Widgery J in Nash v Parkinson Cowan Ltd (1961) 105 S J 323 although the judge in that case does not appear to have been asked to consider the two possible interpretations advanced on the present appeal. 74. 75. Mr Nolan argued that his interpretation was supported by certain statements made by Singleton LJ in Gregson v Hick Hargreaves & Co Ltd [1955] 1 WLR 1252 where at 1263 he said, No one could successfully contend that if there was given off a considerable quantity of dust at one end of this 100 yards long shop, everyone down to the other end of the shop should be provided with a mask. It appears to me, however, these remarks were made in the context of an examination whether it was practicable to supply masks rather than on the question of whether the obligation to take practicable measures arose if the amount of dust was considerable at the time that it was given off. In a later passage Singleton LJ said: On the latter part of section 47(1) on which [counsel for the plaintiff] relies, he is entitled to say there was given off a substantial quantity of dust, and thus the employers were under a duty to take all practicable measures to protect the plaintiff and others employed against inhalation of the dust. 76. I consider therefore that the duty to take practicable measures arises whenever a considerable quantity of dust is given off and that the activation of the duty is not dependent on its being shown that the quantity of dust was considerable at the moment of inhalation. In my view, therefore, the third condition would be satisfied in Mr McDonalds case if the evidence established that, at the time the asbestos dust was given off, it was of substantial quantity. The evidence about the amount of dust at the time that it was given off 77. The Court of Appeal in the present case held that the trial judge had failed to make a finding on whether the amount of dust given off was substantial. At para 62 McCombe LJ said that the judge made no finding on this point because although he had begun to address the question at the beginning of para13 of his judgment, by the end of the paragraph he had strayed off into the question of whether Mr McDonald had been exposed to dust likely to be injurious or offensive. At para 109 Lord Dyson MR said, It is unfortunate that the judge did not make any finding on this issue of fact and it is difficult for this court to make good this omission. 78. McCombe LJ analysed the evidence in relation to the giving off of a quantity of dust in paras 63 and 64 and the Lord Dyson MR expressed agreement with that analysis. For reasons that will appear, it is necessary to set out both paras: 63. Mr Allans submission in this area is that the evidence showed that there were substantial quantities of asbestos dust discharged in the activities at the power station and that it matters not that such dust may not have been substantial at the point of inhalation. He submitted that it was common ground between the experts that the processes at the power station would have produced a substantial quantity of dust. He referred to the reports of Mr Raper for Mr McDonald and Mr Glenn for the first respondent The first of those references includes a table of Mr Rapers compilation referring to the concentrations of asbestos dust to which Mr McDonald was likely to have been exposed. Each is based upon Mr McDonald's proximity to the location of various operations. The table is introduced by the following: 4.31 On the basis of the claimant's account and in view of the foregoing [in which Mr Raper had stated his own understanding of substantial quantities of dust], I would estimate the concentrations of asbestos dust to which the claimant is likely to have been exposed as shown in the following table. The second passage, from the report of Mr Glenn, was in these terms: If there was work with asbestos insulation in the power station then there was the potential for anyone close to that work to be exposed to a high concentration of asbestos dust, but the dust would disperse as it moved away from the work area and those in neighbouring areas would have been subjected to a lower concentration of dust than those directly involved in the work. 64. In my judgment, these passages are slender evidence of the giving off of a substantial quantity of dust. The first is based upon Mr McDonalds account which, as the judge found, had its deficiencies. The second only alludes to a potential for exposure to high quantities of dust based upon proximity of the person in question to the operation in question. I consider that that material is not adequate to demonstrate that there was the giving off of any substantial quantity of dust relevant to the injury said to have been caused to Mr McDonald at these premises. There simply was not the necessary evidence to establish in this case what quantities of dust were discharged by work at this power station and in what circumstances so as to constitute a substantial quantity for the purposes of the section. (Emphasis added). 80. He pointed out that the consultant engineers, Mr Raper and Mr Glenn, in their joint statement agreed that asbestos would have been present in the lagging materials within the power station at the material time. Mr McDonald in his witness statements had described asbestos powder being mixed in oil drums, the cutting of pre formed sections and the removal of old lagging. Mr Raper had stated that these activities would have given rise to high concentrations of asbestos dust. This opinion did not rest solely on Mr Rapers assessment of Mr McDonalds evidence. He referred to published work by PG Harries who had measured dust levels in naval dockyards and supported his opinion by references to the relevant literature. 81. When Mr Raper gave oral evidence these sections of his report were not challenged, Mr Allan claimed. What was put in issue was the extent of Mr McDonalds exposure. It was not surprising, said Mr Allan, that Mr Rapers oral evidence about high concentrations of dust was not challenged since what he had said on the subject was entirely uncontroversial. Moreover, Mr Glenn, in his report, acknowledged that some types of work with asbestos insulation can release large amounts of asbestos dust unless appropriate precautions are taken and he gave a similar opinion in his report to that of Mr Raper regarding the fact that mixing of asbestos would give rise to high concentrations of asbestos dust. 82. At the trial, according to Mr Allan, neither the appellant nor the first defendant disputed that within the power station work was carried out involving asbestos insulation and this work would cause substantial amounts of dust to be given off. What was in dispute was the extent and frequency of Mr McDonalds exposure. Finally, Mr Allan pointed out that in the Cherry Tree case it was not controversial that the type of lagging activities described by Mr McDonald gave rise to high concentrations of visible dust (Hale LJ para 39). 83. For the appellant, Mr Nolan argued that the requirement that there be a substantial quantity of dust introduced either a qualitative or a quantitative dimension and suggested that in Anderson v RWE NPower plc (unreported 22 March 2010) Irwin J had inclined to the view that the substantial element of the requirement involved a qualitative component. At para 43 of his judgment in that case Irwin J had said, the phrase substantial dust itself may add little, since in context it almost certainly meant so substantial as to be likely to be injurious. On this approach some foreseeable risk of injury was imported into the test and its application would have to take account of prevailing knowledge (or lack of knowledge) of the risk. If this was the correct approach, Mr Nolan submitted that the test could not have been satisfied since an unequivocal finding had been made by the trial judge that the level of Mr McDonalds exposure was not greater than that thought of at the material time as being unlikely to pose any real risk to health see para 4 above. If the substantial element connoted merely a quantitative element, Mr Nolan claimed that this must mean more than a significant quantity. He referred to the case of Richards v Highway Ironfounders (West Bromwich) Ltd [1955] 1 WLR 1049 when the plaintiff was found to have had to work in clouds of silica dust. (It is to be noted, however, that there was no examination by Sir Raymond Evershed MR of the extent of dust that had to be present for the requirement of substantial to be met, presumably because it was beyond dispute that the quantity was indeed substantial. It should also be noted that, in contrast with the approach of Irwin J in Anderson, the Master of the Rolls considered that the question of foreseeability of injury was relevant only to the issue of practicable measures). 84. 85. Mr Nolan submitted that any evidence of the quantity of dust which depended on Mr McDonalds account of the working conditions which he encountered was of limited value since his evidence about his exposure had been rejected by Judge Denyer QC as unreal and this finding had not been disturbed by the Court of Appeal. It is important to note precisely what the judge said about this. At para 11 he said: I reject the notion that he was constantly standing in clouds of asbestos dust when he was there this is an unreal scenario. I accept the defendant's analysis that as you move away from the centre of activity, levels of harmful dust decline. I accept that his likely exposure when exposed was not greater than those levels thought of in the 50s and 60s as being unlikely to pose any real risk to health. Two points need to be made about this passage. First the rejection of Mr McDonalds account related to his claim that he was standing in clouds of asbestos dust when, of course, Mr McDonalds case on section 47 was being advanced on the basis of the giving off of substantial quantity of dust of any kind. As the Court of Appeal held, the judge failed to address that question. The second and related point is that the judge appears to have made his judgment on the question of the levels of dust on the basis of whether they gave rise to known risks. He did not address what has been described, for instance by Sir Raymond Evershed MR in Richards, as the dichotomy in section 47. What does substantial mean? 86. The relevant phrase in section 47 is any substantial dust of any kind. I should start my discussion on this part by saying what this does not mean. It does not mean a substantial quantity of injurious dust. The so called dichotomy in section 47 points clearly away from such an approach. Whether the second limb of the subsection is triggered calls for a purely quantitative assessment. It may well be, as suggested in cases such as Richards and Gregson, that the possibly injurious propensity of the dust has a part to play in deciding what are practicable measures. But that has nothing to say on the question whether, in the first instance, there is any substantial quantity of dust of any kind. 87. The question whether the dust is asbestos or other injurious dust should therefore not obtrude into the initial assessment of whether the second limb of section 47(1) is engaged. To do this conflates consideration of the second limb with considerations that are relevant to the first limb. Proper application of the subsection requires a staged approach: (i) is the dust, fume or other impurity which is given off of such a character and given off to such an extent as to be likely to be injurious or offensive to the persons employed? (ii) if not, has any substantial quantity of dust of any kind been given off in the workroom where the claimant was a person employed? (iii) if the answer to (i) or (ii) is yes are there practicable measures which can be taken to protect the persons employed against inhalation of the dust or fume or other impurity and to prevent its accumulation in any workroom? And (iv) if the answer to (iii) is yes have they been taken? 88. This staged approach was not followed by the trial judge nor, I am afraid, by the Court of Appeal, although, in fairness, it does not seem to have been presented to either in quite the stark way that I have expressed it. Indeed, by the time that the matter came before the Court of Appeal, it may not have been feasible for counsel to present it in quite that way, given the flow of the evidence before Judge Denyer QC. Be that as it may, it is clear that the sharp distinction that should have been drawn between matters required to establish liability under the first limb and those required to sustain a case under the second was not maintained. The opening words of para 63 of McCombe LJs judgment and his observation that there was no evidence that any substantial quantity of dust relevant to Mr McDonalds injury had been given off disclose that that clear division between the two limbs was not preserved. Of course, the question of whether any substantial quantity of any dust caused or contributed to Mr McDonalds condition would always be relevant but not at the stage where what was being decided was if there was a substantial quantity of dust of any kind. 89. Mr Allan submits that the failure of the trial judge and the Court of Appeal to approach the application of the second limb properly is not fatal to the respondents case on the cross appeal. In particular, he points to the fact that, at the time of Mr McDonalds exposure, no reliable scientific means existed for measuring the concentrations of dust in the atmosphere. In these circumstances, he suggests, the assessment of dust levels had to be by reference to a visible dust cloud, even though the hazardous proportion of the dust would be invisible to the naked eye. There was enough evidence, he claimed, to allow this court to conclude that such a visible dust cloud was present and that, therefore, the proposition that there was a substantial quantity of dust was made out. 90. The problem with this submission is that there was no examination before the trial judge or the Court of Appeal of the issue whether the only means of assessing whether dust levels amounted to substantial was by visible assessment. Or, at least, if there was, it does not feature in the judgment of either court. Nor was evidence given of how dense the cloud would have to appear to be. These, and doubtless many other issues, would have been canvassed before Judge Denyer QC if there had been a clear confrontation of the question whether, merely on its appearance, the quantity of dust which was generated at the time Mr McDonald was in the workroom satisfied the statutory requirement of being substantial. It is not possible for this court to conduct retrospectively the type of investigation that would be required to provide a confident outcome to that debate. I have concluded, therefore, that the third condition has not been, and cannot now be, satisfied. The fourth condition has it been shown that Mr McDonald inhaled asbestos dust which caused his mesothelioma? 91. The undisputed evidence was that anyone who was present in the workroom where lagging operations were carried out would be exposed to asbestos dust. It was not disputed that Mr McDonald was so present. While the extent of his exposure was a matter of controversy, the fact that he was exposed to some extent was not. Therefore, as Lord Dyson MR pointed out in para 119 of his judgment, in the absence of any suggestion that he was exposed to asbestos in any other employment or in the general atmosphere, causation will have been established in the conventional way. I consider that causation has been established and that Mr McDonalds estate is entitled to recover appropriate compensation. Disposal 92. I would dismiss the appeal and the cross appeal. LADY HALE: 93. A just and sensible judge is always prepared to admit that she has been wrong. But it would not have been comfortable to be the swing vote between two Justices who thought that Cherry Tree Machine Company Ltd v Dawson (sub nom Jeromson v Shell Tankers (UK) Ltd) [2001] EWCA Civ 101, [2001] ICR 1223 was rightly decided and two who thought that it was wrong. I am therefore mightily relieved that the unanimous view is that it was rightly decided. The claimants husband in Cherry Tree was employed as an apprentice fitter in a factory which manufactured dry cleaners presses. For two years, it was part of his job to mix asbestos flock with water in a bucket and then apply it to the plattens of a press in order to seal them to stop the steam escaping. He was therefore mixing the asbestos as part of the process of manufacturing a product containing asbestos. That sort of mixing, as Lord Reed explains, was covered by the Asbestos Industry Regulations 1931. He was also engaged in the manufacture of such products and thus undoubtedly within the class of persons whom the Regulations were designed to protect. 94. The first question in this case is whether the mixing of asbestos with water in order to form a paste with which to lag pipes and boilers in a power station was also covered by the Regulations. The second question is whether the Regulations were designed to protect a person such as Mr McDonald, who was not employed by the power station but was there in the course of his employment with another employer. Neither question is without difficulty, as the difference of opinion in this court demonstrates. But it is common ground that if Mr McDonalds exposure to asbestos was in breach of a statutory duty owed to him, the power station will be liable on the basis of having materially increased the risk of his suffering injury from that exposure. 95. The Regulations in question were made under section 79 of the Factory and Workshop Act 1901 (see para 6 above). This gave the Secretary of State power to do two things: first, to certify that any manufacture, machinery, plant, process or description of manual labour, used in factories or workshops was dangerous, if he was satisfied that it was dangerous or injurious to health or dangerous to life or limb, either generally or in the case of women, children or any other class of persons; and second, having so certified, to make such regulations as appeared to him reasonably practicable and to meet the necessity of the case. Section 82 made it clear that the regulations could cover any factory or workshop where the certified manufacture or process took place. 96. The Secretary of State certified as dangerous the manipulation of asbestos and the manufacture or repair of articles composed wholly or partly of asbestos and processes incidental thereto. The focus was upon the processes of manipulation and manufacture and not on any particular setting where this might happen. This focus is carried through into the Preamble to the Regulations, which directs that they shall apply to all factories and workshops or parts thereof in which the following processes or any of them are carried on. The only indication in the Regulations that they might not apply to all such factories or workshops is in the title The Asbestos Industry Regulations coupled with what that might have been understood to mean at the time. 97. But that understanding is not crystal clear from the Merewether and Price Report on whose findings and recommendations the Regulations were based. We can all read that Report, and the Report on Conferences between Employers and Inspectors concerning Methods for Suppressing Dust in Asbestos Textile Factories which followed it, and find some words which appear to support the view which we have taken of the Regulations and some which point the other way. Part I of the Merewether and Price Report is devoted to establishing that there is a dose related risk to health from exposure to asbestos dust. Part II is devoted to an explanation of the processes in which asbestos dust might be generated and the methods of suppressing that dust. The introduction to Part II lists seven main groups of asbestos products, including at (c) insulation materials. But it also points out that apart from manufacture, certain work is carried on in premises subject to the Factory and Workshops Acts, as well as in other premises, which involves use or manipulation of asbestos or products containing it (p 19). It cannot therefore be assumed that the authors were only concerned with the factories and workshops in which the particular seven products listed as (a) to (g) were produced. The concluding summary and recommendations include the comment that Dust is produced at many kinds of machines, in hand process work, and in simple incidental operations, particularly in emptying settling chambers, and in all handling of fiberized asbestos (p 31). The overall message is clear: asbestos dust is potentially harmful; it is produced when handling asbestos and in various other manufacturing processes; and steps should be taken to suppress it. In my view, the title to the Regulations, and the preceding Report, are by no means clear and unequivocal enough to dispel the plain meaning of the words of the Preamble to the Regulations, which direct that they shall apply to all factories and workshops in which the listed processes are carried out. This is reinforced by the exclusion of places where only some of those processes are carried on and then only occasionally. The Regulations do only apply to factories and workshops, and not, therefore, to places such as ships where processes producing asbestos dust were also known to be carried on. But the power station with which we are concerned was a factory or workshop to which the Factories Acts applied. 98. 99. The next question, therefore, is whether mixing asbestos containing insulation material in large drums to create insulating paste was a process covered by the Regulations. Mr Nolan QC, for the defendant, mounted a vigorous argument that mixing in paragraph (i) of the list of processes in the Preamble had a narrow technical meaning which could not include mixing such as this. He pointed to the uses of the term mixing, in both the Merewether and Price Report and the Report on Conferences, in the context of the work of preparing raw asbestos for use. He also pointed to the context, at the beginning of the list of processes in the Regulations, before the references to the processes involved in the manufacture of various products. 100. Mr Nolans meaning would not have included the mixing of asbestos flock with water in order to make the paste used to seal the plattens in Cherry Tree, a process which is also described in the Merewether and Price Report. His meaning is difficult to reconcile with the Regulations definition of asbestos as any fibrous silicate mineral, and any admixture containing any such mineral, whether crude, crushed or opened. As Lord Reed points out (para 155(v)), mixing of asbestos can take place at three stages within the asbestos industry: mixing the contents of sacks before crushing; mixing the crushed material before it is opened; and mixing the opened or fiberized asbestos with other materials in order to produce asbestos products. But once the meaning is taken beyond the narrow technical meaning for which Mr Nolan argued, it is difficult to see why mixing asbestos (as defined in the Regulations) with water to make a paste to seal the plattens in a dry cleaning press is covered but mixing the same asbestos with water to make lagging paste is not, provided that both processes are carried on in a place covered by the Factories Acts. The question comes back, therefore, to whether the Regulations are confined to the industry of making asbestos products, on which I respectfully differ from Lord Reed for the reasons given earlier. 101. The next question, therefore, is whether Mr McDonald was a person for whose protection the Regulations were made. The 1901 Act itself made no mention of civil liability towards anyone. Under section 85(1), breach of the Regulations was a criminal offence punishable only with a fine. But it was long ago established that, if statutory duties were created for the protection of a particular class of persons, who might be injured if those duties were not observed, then Parliament might not have intended that criminal liability were the only remedy: see, for example, the classic statement in Groves v Lord Wimborne [1898] 2 QB 402. Civil liability therefore depends upon whether the claimant belongs to such a class. But logic suggests that there must be some limit: the class may be very wide but it is less likely that legislation creating a criminal offence also intended to impose what is often a strict civil liability, independent of negligence or the foreseeability of harm, towards anyone at all who might suffer injury as a result of a breach. 102. Sometimes the statute itself suggests the limit, as with the provisions of sections 47 and 49 of the Factories Act 1937, which protect respectively persons employed and persons employed in the process (see paras 17 and 67 above). Sections 79 and 82 of the 1901 Act do not contain even those limits. There is the complication, as pointed out in Canadian Pacific Steamships Ltd v Bryers [1958] AC 485, that the 1901 Act was repealed by the 1937 Act and Regulations made under it were deemed to have been made under the corresponding provisions of the 1937 Act; section 60 of the 1937 Act was originally limited to the protection of persons employed in the regulated processes; but this was amended in 1948 to cover all persons employed. However, as Viscount Kilmuir pointed out, while Regulations which were ultra vires when made could not be rendered intra vires if the scope of the later Act were wider, it did not follow that Regulations which were intra vires when made could become ultra vires if the scope of the later Act were narrower. 103. Is there anything, therefore, to suggest that the duties imposed in the 1931 Regulations are owed only to persons employed by the factory or workshop in question, as opposed to persons employed elsewhere who come to the factory in the course of their employment and may be exposed to asbestos dust as a result? Part II of the Regulations imposes certain duties (breach of which is also punishable by a fine) upon persons employed, but some refer simply to persons employed, others to persons employed at [specified] work, and one provides that no person shall misuse or wrongfully interfere with appliances provided in pursuance of the Regulations. This certainly suggests a link with employment, but not with any particular employment. 104. Although liability under the Factories Acts is often considered a type of employers liability, it is in fact a species of occupiers liability, the duties being placed upon the occupiers of the factories and workshops to which they applied. The object of those duties was to protect people from the harm which they might suffer as a result of the processes being carried on there. As was pointed out by both Lord Goddard LC and Streatfeild J in Massey Harris Ferguson (Manufacturing) Ltd v Piper [1956] 2 QB 396, it is often the people who are not regularly employed in the factory in question who are most in need of the protection offered by duties of this sort. The test which they adopted was whether a person was employed in the factory, not whether he was employed by the occupier. This test was approved by the House of Lords in the Canadian Pacific Steamships case. 105. The court in both those cases clearly regarded the decision in Hartley v Mayoh & Co [1954] 1 QB 383 as something of an exception to the general principle. There it was held that there was no liability under the Electricity Supply Regulations towards a fireman attending a factory fire who was electrocuted because of faulty wiring. It is noteworthy that, first, the occupier was only held responsible for 10% of the damages, the remainder being the responsibility of the electricity company; second, that the occupier was held liable in common law negligence anyway; and third, that no authorities, other than the general principle in Groves v Lord Wimborne, are cited for the proposition in any of the judgments in the Court of Appeal. 106. Mr Allan QC, for the respondent claimant, suggested that the test of a person employed is a person who attends the factory in the course of his employment, with the possible proviso that he does so in connection with the processes carried on there, rather than solely in connection with his employers business. Mr McDonald met that test. He was there on a regular, although not frequent, basis in order to collect the pulverised fuel ash generated by the power stations processes. I accept, of course, that at the time the Regulations were made, it was not known that a fatal disease might be caused by exposure to a single fibre of asbestos. The Merewether and Price Report was concerned with what was then seen as a dose related risk of developing asbestosis. But the Report also acknowledged that the appropriate methods for suppression of dust may only be fully determined when the harmful effects of comparatively low concentrations of asbestos dust are duly appreciated (p 31). The message was clear: asbestos dust is harmful and the then known methods must be employed to protect workers from it. I see no difficulty in regarding Mr McDonald as a person employed in the power station, albeit not by the power station, who was entitled to such protection as the Regulations then required. 107. It follows that I agree with Lord Kerr and Lord Clarke that the appeal should be dismissed. 108. In those circumstances, it is not strictly necessary to express a view on the cross appeal, but in my view it should be allowed. As I am in a minority of one on this issue, I will explain my reasons very briefly. All the conditions required by the substantial quantity limb of section 47 of the Factories Act 1937 (see para 109) are made out. I agree, for the reasons given by Lord Kerr, that the lagging operations were a process carried on at the power station. I also agree with him that Brophy v JC Bradfield & Co Ltd [1955] 1 WLR 1148 was wrong to hold that a factorys heating system was not a process carried on in the factory for this purpose. I agree with both Lord Kerr and Lord Reed that the persons protected are not limited to those employed on the process in question. For the reasons given earlier, I agree with Lord Kerr that the claimant was a person employed and thus protected by section 47. And I agree with both Lord Kerr and Lord Reed that the quantity of dust must be substantial at the time when it is given off and not necessarily at the time when it is inhaled. I remind myself that causation is not in issue in this case. 109. Where I respectfully disagree is in their conclusion that there was no evidence that the quantity of dust given off at the relevant time was substantial. I agree with Lord Kerr that this limb of section 47 requires only a quantitative assessment of the amount of dust of any kind being given off at the relevant time. The relevant time is not when Mr McDonald was exposed to the dust or in the room where the lagging work was being done. It is when the dust was given off. This issue was not addressed by the trial judge, who was side tracked into issues of foreseeability and whether the dust was likely to be injurious, which are relevant to negligence and to the first limb of section 47, but not to the second. Nor, with respect, was it addressed by the Court of Appeal in the passages quoted by Lord Kerr (at para 78). They were concentrating on the evidence of Mr McDonalds exposure and not on the evidence of the quantity of dust given off when it was given off. The evidence of both experts as to the amount of dust likely to have been given off by the various lagging activities carried on at the power station (summarised by Lord Kerr at paras 79 to 81) was entirely uncontroversial. In my view it shows that the amount of dust given off was substantial. The question then is whether practicable measures could have been taken to protect persons employed from inhaling the dust. But that issue has not been raised by the appellant defendant, who has throughout argued that the section does not apply, rather than that there was nothing the appellant defendant could reasonably have done about it. The burden was upon the appellant defendant to make such a case and the appellant defendant has not. 110. Hence I would have allowed the claimant/respondents cross appeal in addition to dismissing the defendant/appellants appeal. LORD CLARKE: 111. Lord Kerr and Lord Reed have reached different conclusions on the question whether the appellant was in breach of regulation 2(a) of the Asbestos Industry Regulations 1931 (the Regulations). Lord Kerr concludes that it was, whereas Lord Reed concludes that it was not. I prefer the reasoning and conclusion of Lord Kerr on this question, which is the critical question in this appeal. 112. Lord Kerr concludes that the Regulations should be given a broad construction. He refers in paras 6 to 14 to the statutory basis for and to the provenance of the Regulations. He refers to sections 79 and 82 of the Factory and Workshop Act 1901 and to a letter from the relevant Secretary of State dated 15 September 1931 enclosing a draft of the Regulations. He notes the breadth of the anticipated application of the Regulations and the express provision in section 82(1) that processes which did not exist at the time could come within the Regulations in the future. Thus section 83 provided that regulations made under the Act might, among other things, (b) prohibit, limit or control the use of any material or process. At para 10 Lord Kerr quotes from the preamble to the Regulations, of which para (i) is of particular relevance here. It provided that the Regulations were to apply to all factories and workshops or parts thereof in which the following processes or any of them are carried on: (i) breaking, crushing, disintegrating, opening and grinding of asbestos, and the mixing or sieving of asbestos, and all processes involving manipulation of asbestos incidental thereto; The remaining sub paragraphs are set out by Lord Kerr in para 10 above. 113. Then in paras 11 and 12 Lord Kerr refers to one of the provisos to those provisions: Provided that nothing in these Regulations shall apply to any factory or workshop or part thereof in which the process of mixing of asbestos or repair of insulating mattresses or any process specified in (v) or any cleaning of machinery or other plant used in connection with any such process, is carried on, so long as (a) such process or work is carried on occasionally only and no person is employed therein, for more than eight hours in any week, and (b) no other process specified in the foregoing paragraphs is carried on. I agree with Lord Kerr that, although the proviso cut down the scope of the Regulations, it also gave some insight into their intended ambit. In particular, it carried the clear implication that the processes identified in the preamble, other than those listed in the proviso, were to come within the Regulations even if the work involved in them took place only occasionally or for limited periods. Also, as Lord Kerr observes, in relation to the processes listed in the proviso, including mixing, the Regulations were to apply unless the work was carried out occasionally and no person undertook it for more than eight hours a week. 114. The preamble provided that it was the duty of the occupier of relevant premises to observe Part I of the Regulations, which included regulation 2. Regulation 2(a) and (b) provided: 2. (a) Mixing or blending by hand of asbestos shall not be carried on except with an exhaust draught effected by mechanical means so designed and maintained as to ensure as far as practicable the suppression of dust during the processes. (b) In premises which are constructed or reconstructed after the date of these Regulations the mixing or blending by hand of asbestos shall not be done except in a special room or place in which no other work is ordinarily carried on. 115. The essential issue between the parties is whether the regulation 2(a) covered only the asbestos industry and was concerned with asbestos in its raw unprocessed condition, as submitted on behalf of the appellant, or whether it extended to processed asbestos products, as contended on behalf of the respondent. In powerful judgments, Lord Reed espouses the former view, whereas Lord Kerr espouses the latter. 116. Both Lord Kerr and Lord Reed refer extensively to the Merewether and Price Report and other relevant pointers. I entirely accept that a critical part of the Regulations was concerned with processes in the manufacture and repair of items containing asbestos. This is plain from paras (i) to (vi) of the preamble quoted by Lord Kerr at para 10 and, indeed, can be seen from the title to the Regulations, namely the Asbestos Industry Regulations. However, the question is whether that expression should be given a wider or narrower meaning. It seems to me that the better view is that it should be given a wider meaning. 117. The purpose of the Regulations was surely to protect workers from the consequences of asbestos dust. I do not myself see why that protection should be limited to those affected by asbestos dust in the process of manufacture and repair and not those affected whenever a defined process was carried on in a factory or workshop. 118. All depends upon whether the process carried on in the present case was within para (i) of the preamble to the Regulations quoted above. In short, was it within the expression mixing or sieving of asbestos, and all processes involving manipulation of asbestos incidental thereto? Asbestos was defined as meaning any fibrous silicate mineral, and any admixture containing any such mineral, whether crude, crushed or opened. As I read his judgment, Lord Kerr accepted these submissions made on behalf of the respondent (summarised at his para 23). (1) Consistently with the mischief identified by Merewether and Price and the remedy they proposed, the terms of section 79 and the certification of the Secretary of State indicated that the Regulations were to apply whenever and wherever a defined process was carried on in a factory or workshop. (2) There was no need to adopt a narrow definition of asbestos industry and on that basis restrict the application of the Regulations. The title was used in the wide sense of any industry where one or more of the processes referred to in the preamble was carried on. 119. I agree. As I see it, the specific question which must be answered is that identified by Lord Reed in paras 151 and 152. As he says in para 151, the expert evidence given at the trial indicated that insulation material containing opened or fiberized asbestos were widely used until the 1960s for lagging boilers and pipework. Such material commonly contained fiberized asbestos, mixed with other substances such as calcium silicate or cement. The insulation material could either be pre formed or mixed with water and applied in the form of a paste. Pre formed sections were sawed by hand in order to profile them for fitting. The mixing of the paste involved bags of powdered insulation material being emptied into open topped containers for mixing with water. Lord Reed concludes in para 152 that, having regard to that evidence, it appears likely, on the balance of probabilities, that the insulating material used by the laggers was an admixture containing fiberized asbestos and was therefore asbestos as defined in the Regulations. The question posed by Lord Reed is whether the activities of the laggers fell within the Regulations. 120. I agree with Lord Reed that that is indeed the question. It appears to me, at any rate on the face of it and if the language is given its ordinary and natural meaning, that the conclusion that the material was an admixture amounts to a conclusion that there had been a mixing of asbestos within the meaning of para (i) of the preamble. Equally, as I see it, there was a process of mixing of asbestos within the meaning of the proviso quoted above, although the proviso would not apply on the facts because the conditions were not both satisfied. For my part, I do not think that the principle noscitur a sociis leads to the conclusion that the word mixing should be given other than its ordinary and natural meaning. 121. I turn briefly to the authorities. I agree with Lord Reed that in Watt v Fairfield Shipbuilding & Engineering Co Ltd 1999 SLT 1084 Lord Gill confined the scope of the Regulations too narrowly. I also agree with him that the first case in which a detailed consideration of the background to the Regulations was Cherry Tree Machine Co Ltd v Dawson (sub nom, Jeromson v Shell Tankers (UK) Ltd) [2001] EWCA Civ 101; [2001] ICR 1223, which has been discussed in some detail by both Lord Kerr and Lord Reed and in which Hale LJ gave the only reasoned judgment, with which Mantell LJ and Cresswell J agreed. Both Lord Kerr and Lord Reed accept that it was correctly decided, although Lord Reed expresses disagreement with some of the dicta in Hale LJs judgment. 122. As I read that judgment, Hale LJ approached the construction of the Regulations in the way that I have sought to do. I refer to only two aspects of her judgment in addition to those referred to by Lord Kerr. First, she said at para 24 on p 1232 that none of the arguments in Banks v Woodhall Duckham Ltd (which was an unreported decision of the Court of Appeal dated 30 November 1995) or Watt was sufficiently persuasive to combat the natural and ordinary meaning of the words used. Hale LJ approached the issue of construction by reference to the natural and ordinary meaning of the words used and was not persuaded that the title to the Regulations, namely the Asbestos Industry Regulations, led to any different conclusion. At para 20 she described the most powerful of the submissions to the contrary as being the title to the Regulations but said that there were two even more powerful points in reply. The first was that the Regulations were expressed to apply to any factory or workshop where the defined processes took place and the second was a point on the proviso much as referred to above. Secondly, at para 25, Hale LJ expressed some doubt as to whether the Regulations applied to the work of knocking off old lagging but that they were more likely to have applied to the laggers work in mixing asbestos to form new insulation. I respectfully share those views of Hale LJ (for the reasons she gives) and the views of Lord Kerr on mixing at paras 45 to 49 and prefer them to the different views of Lord Reed. 123. I would only add that I also share the views of Lord Kerr expressed at paras 27 to 35 of his judgment. In particular, if the Secretary of State had intended to limit the Regulations to a narrow view of the asbestos industry, he could easily have done so, whereas, as Hale LJ observed, the Regulations made it clear that all factories and workshops in which certain specified processes were carried out were covered. If the purpose of the Regulations was to protect workers from asbestosis dust, why exclude these workers? I adopt Lord Kerrs approach to the Merewether and Price Report at his paras 28 to 35 without repeating it here. I would only underline the statement of Judge LJ quoted by Lord Kerr at his para 29, that the research was confined to asbestos textile workers, but [the report] explained that workers in other industries, exposed to asbestos dust, were also at risk. The critical finding was that exposure to asbestos dust gave rise to grave illness. 124. For these reasons, like Lord Kerr, I would hold that the Regulations applied to the work being done by the laggers. I agree with Lord Kerr and Lord Reed that it is not necessary for a person in the position of Mr McDonald to show that he was employed by the occupier or in the process in connection with which the dust or fume is given off. The question remains, however, whether he was employed at the factory. As Lord Kerr explains at paras 72 and 73, it is not necessary that the employee should be acting in the course of his employment: Uddin v Associated Portland Cement Manufacturers Ltd [1965] QB 582, per Lord Pearce at 593E. 125. Lord Kerr notes at para 71 that, at any rate for the purposes of section 60 of the 1937 Act, persons employed included any person who might be called on to do work at the factory, including a painter employed by an independent contractor: see for example Massey Harris Ferguson (Manufacturing) Ltd v Piper [1956] 2 QB 396. On the other hand, after referring to those cases, Lord Reed observes at para 217 that the expression does not extend to a fireman who enters a factory in order to put a fire out (Hartley v Mayoh & Co [1954] 1 QB 383), or to a police constable who enters a factory in pursuit of a felon (Wigley v British Vinegars Ltd [1964] AC 307, 324 per Viscount Kilmuir), although he is a person and he is employed. Lord Reed adds that in Canadian Pacific Steamships Ltd v Bryers [1958] AC 485, 504 Viscount Kilmuir considered that the phrase applied to any person who is employed in the factory whether the direct servant of the occupier or a servant of an independent contractor so long as he is employed upon work in that factory. He adds that in the later case of Wigley v British Vinegars Ltd, concerned with a window cleaner employed by an independent contractor, Viscount Kilmuir said, at p 324: In my view, the true distinction is between those who are to work for the purposes of the factory and those who are not. Clearly, maintenance of the factory is work for the purpose of the factory, while the arrest of a felon or the putting out of a fire is not, though it may benefit the factory indirectly. Window cleaning is part of the maintenance of the factory and in my view the deceased was within the protection afforded. 126. Lord Reed recognises that these principles tend to give rise to the drawing of fine distinctions without any compelling rationale. The present case might be regarded as an example. As he puts it at para 218, it could perhaps be argued that Mr McDonald was employed for the purposes of the power station, either on the basis that one of those purposes was the sale of the ash, and he was employed collecting ash which had been sold, or on the basis that the ash was a by product which the power station had to dispose of, and he was employed removing it. However, Lord Reed prefers the contrary view as being more persuasive on this basis. Mr McDonald was not in reality working for the purposes of the power station. He was working solely for the purposes of his employer, the Building Research Establishment. It was the purchaser of the ash which was a by product of the power station, and it employed Mr McDonald to collect the ash in his lorry. A customer of a factory can hardly be regarded as working for the purposes of the factory. 127. I am bound to say that I prefer the former view. It appears to me that a lorry driver who goes to a factory to collect its produce is in a real sense working for the purposes of the factory, albeit as the employee of someone else. The collection of goods is essential to the operations of the factory. The driver is much closer to the painter or the window cleaner than the fireman or the policeman. I therefore prefer the view of Lord Kerr. I would hold that, in the relevant sense and at the material time, Mr McDonald was employed in the factory. 128. For these reasons I would hold that the appellant was in breach of the duty contained in regulation 2(a) and that, provided that the relevant causal link was established, the respondents estate is entitled to recover appropriate compensation. As to causation, the position is summarised by Lord Dyson MR in para 119 of his judgment as follows: As I understand it, the only evidence of Mr McDonalds exposure to asbestos dust is of exposure from the activities at the National Grids factory. There is no suggestion that he was exposed to asbestos dust in the course of any other employment during his working life. It follows that, unless he was exposed to asbestos dust in the general atmosphere, the mesothelioma must have been caused by the dust to which he was exposed at the National Grids factory. If he was not exposed to asbestos dust in the general atmosphere, causation will have been established in the conventional way. If he was exposed to asbestos dust in the atmosphere, then he will succeed on the basis that the National Grid materially increased the risk of Mr McDonald contracting mesothelioma: see Sienkiewicz v Greif (UK) Ltd [2011] UKSC 10, [2011]2 AC 229. 129. For these reasons I would dismiss the appeal. I do not wish to say anything about the cross appeal. LORD REED (with whom Lord Neuberger agrees) Introduction 130. Mr McDonald was diagnosed with mesothelioma in 2012, and died from the disease in 2014. His only known exposure to asbestos occurred when he was employed by the Building Research Establishment between 1954 and 1959 as a driver and, in the course of that employment, drove a lorry to Battersea Power Station from time to time in order to collect pulverised fuel ash for use in the experimental production of building materials. In order to collect the ash, Mr McDonald had to drive his lorry beneath a chute outside the power station from which the ash was released. He was not exposed to asbestos during that process. 131. The evidence that he was exposed to asbestos during his visits to the power station comes from two written statements made by him, on which he was not well enough to be cross examined. In his first statement, he said that there was generally a queue of vehicles waiting for deliveries, and that it was his habit to park his lorry and go into the power station for about an hour. He had to deal with paperwork and talk to the manager about his delivery. He got to know the workers in the power station, and they would show him around. He would also have lunch in the power station. He generally waited in the power station until it was time for him to collect the ash and leave. 132. In his second statement, he said that once inside the power station it took him five minutes to walk to the managers office. There were usually other people waiting to speak to the manager. Once his paperwork was completed he would speak to the workers who were dealing with his delivery about any delays. He also used the lavatories in the power station. 133. In both statements, he described being present when thermal lagging was applied to boilers and pipework, and seeing the laggers mixing asbestos powder with water in order to make the lagging paste which they then applied to the boilers or pipes being insulated. He also saw laggers cutting pre formed sections of asbestos to fit to pipes and boilers, and removing old asbestos insulation from pipework. He claimed to have been in close proximity to such work, with visible clouds of asbestos in the air. 134. Aspects of this account were challenged by the appellants, who are the successors of the former occupiers of the power station, and their co defendant at the trial, the Department for Communities and Local Government, which is the successor of Mr McDonalds employer. It was common ground that the ash plant was separate from the power station, and did not have any lagged pipes or boilers. If Mr McDonald had to enter the power station at all, it would only be to go to the offices. The offices, lavatories and canteen would not be dusty environments. There was no need for Mr McDonald to go inside the boiler house or the turbine house, where there would be lagging of boilers and pipes. If he did so, he went there as a casual visitor. It was very unlikely that Mr McDonald would have been standing in close proximity to clouds of asbestos. 135. The trial judge, HH Judge Denyer QC, accepted the defendants analysis of the real extent and duration of Mr McDonalds visits to the power station. He concluded that any exposure was at a modest level on a limited number of occasions over a relatively short period of time, and that his likely exposure when exposed was not greater than those levels thought of in the 50s and 60s as being unlikely to pose any real risk to health. 136. The question which arises on this appeal is whether the appellants are liable in damages for breaches by their predecessors of regulation 2(a) of the Asbestos Industry Regulations 1931 (the 1931 Regulations) and section 47(1) of the Factories Act 1937 (the 1937 Act). The judge rejected Mr McDonalds claims under both heads, and also a claim in negligence. The Court of Appeal allowed the appeal in so far as the claim was advanced under the 1931 Regulations. The appellants appeal against that decision. There is a cross appeal against the dismissal of Mr McDonalds claim under the 1937 Act. The claim in negligence is no longer pursued. 137. I approach the questions raised in the following three parts, before concluding that the appeal should be allowed and the cross appeal dismissed: 1. The historical background to the making of the 1931 Regulations and the enactment of the 1937 Act. 2. An analysis of the Regulations against the backdrop of certain earlier documents and the relevant authorities, as well as subsequent legislation made on the basis of the understanding of the Regulations which I favour. I conclude this part by considering whether Mr McDonald was within the scope of the Regulations in any event. 3. An analysis of section 47(1) of the 1937 Act and its application to Mr McDonalds case. 138. Although the legislation in question was repealed long ago, the questions raised as to its interpretation are of continuing practical significance. As the facts of this case demonstrate, the consequences of exposure to asbestos may not become apparent for many years. When they emerge, the resultant claims are often of substantial value and of considerable importance to the individuals affected, to the insurance industry and to the Government (which has succeeded to potential liabilities, particularly as a result of the nationalisation of industries in which asbestos was used). The ambit of the legislation is therefore a matter of general public importance. Part I: the Historical Background 139. It is important to understand at the outset that the connection between asbestos and mesothelioma was unknown when the 1931 Regulations and the 1937 Act were conceived and introduced (and, for that matter, during the period when Mr McDonald visited the power station). The legislation was not designed to protect against the risk of mesothelioma: a risk consequent upon exposure to any quantity of asbestos dust, however infrequent the exposure may be, and however insubstantial the quantity of dust to which the person is exposed. The legislation has to be interpreted in the same way as any other legislation, and not distorted in order to provide compensation to those who were not intended to fall within its protection. It should also be interpreted without any preconception that it must have been intended to maximise the protection afforded to workers: then as now, legislation concerned with health and safety reflected a compromise between competing interests and objectives. The Factory and Workshop Act 1901 140. The 1931 Regulations were made under section 79 of the Factory and Workshop Act 1901 (the 1901 Act). Part IV of the 1901 Act was headed Dangerous and Unhealthy Industries. It contained two groups of provisions. The group relevant for present purposes was headed Regulations for Dangerous Trades. It included section 79, which provided that where the Secretary of State was satisfied that any manufacture, machinery, plant, process or description of manual labour used in factories or workshops is dangerous or injurious to health or dangerous to life and limb, he might certify that manufacture, machinery, plant, process or description of manual labour to be dangerous. On such certification, the Secretary of State might make such regulations as appeared to him to be reasonably practicable and to meet the necessity of the case. The certification 141. In accordance with section 80 of the 1901 Act, notice was given of a proposal to make the 1931 Regulations in a letter issued by the Home Office dated 15 September 1931. The letter narrated that, as required by section 79, the Secretary of State had formally certified as dangerous: the manipulation of asbestos and the manufacture or repair of articles composed wholly or partly of asbestos and processes incidental thereto. 142. It will be necessary at a later point to return to that letter. For the present, it is to be noted that the certification, which was critical to the scope of the power to make regulations, concerned the manipulation of asbestos a term which, as I shall explain, is descriptive of fibrous silicate minerals and the manufacture or repair of articles composed wholly or partly of those minerals. Part 2: the 1931 Regulations 143. The 1931 Regulations, which were subsequently revoked and replaced by the Asbestos Regulations 1969 (SI 1969/690, the 1969 Regulations), are entitled The Asbestos Industry Regulations. That title suggests that the Regulations are concerned with something identifiable as the asbestos industry, rather than with the use of the products of that industry in the work of other industries. That is as one might expect from the terms of the certification, which as I have explained concerned the manipulation of asbestos, and the manufacture and repair of articles composed wholly or partly of asbestos, rather than the use of asbestos products. 144. The Regulations begin with a preamble in which the Secretary of State directs that they are to apply to all factories and workshops or parts thereof in which the following processes or any of them are carried on: (i) breaking, crushing, disintegrating, opening and grinding of asbestos, and the mixing or sieving of asbestos, and all processes involving manipulation of asbestos incidental thereto; (ii) all processes in the manufacture of asbestos textiles, including preparatory and finishing processes; (iii) the making of insulation slabs or sections, composed wholly or partly of asbestos, and processes incidental thereto; (iv) the making or repairing of insulating mattresses, composed wholly or partly of asbestos, and processes incidental thereto; (v) sawing, grinding, turning, abrading and polishing, in the dry state, of articles composed wholly or partly of asbestos in the manufacture of such articles; (vi) the cleaning of any chambers, fixtures and appliances for the collection of asbestos dust produced in any of the foregoing processes. 145. A proviso to the preamble excludes the application of the 1931 Regulations to: any factory or workshop or part thereof in which the process of mixing of asbestos or repair of insulating mattresses or any process specified in (v) or any cleaning of machinery or other plant used in connection with any such process, is carried on, so long as (a) such process or work is carried on occasionally only and no person is employed therein for more than eight hours in any week, and (b) no other process specified in the foregoing paragraphs is carried on. As the proviso indicates, occasional exposure to asbestos dust was not thought at that time, unlike the present, to involve a significant risk to health. A further proviso permits the Chief Inspector of Factories to suspend or relax the Regulations, if satisfied that, by reason of the restricted use of asbestos or the methods of working, they could be suspended or relaxed without danger to those employed. 146. A number of terms used in the Regulations are defined. In particular, asbestos is defined as meaning: any fibrous silicate mineral, and any admixture containing any such mineral, whether crude, crushed or opened. 147. In relation to the obligations imposed by the 1931 Regulations, it is necessary in particular to note regulations 1(a) and 2. 148. Regulation 1(a) requires an exhaust draught, preventing the escape of asbestos dust into the air, to be provided for manufacturing and conveying machinery, namely: (i) preparing, grinding or dry mixing machines; (ii) carding, card waste end, ring spinning machines, and looms; (iii) machines or other plant fed with asbestos ; (iv) machines used for the sawing, grinding, turning, abrading or polishing, in the dry state, of articles composed wholly or partly of asbestos. "Preparing is defined as meaning: crushing, disintegrating, and any other process in or incidental to the opening of asbestos. A proviso states that regulation 1 does not apply inter alia to mixing or blending by hand of asbestos. 149. Regulation 2 provides: (a) Mixing or blending by hand of asbestos shall not be carried on except with an exhaust draught effected by mechanical means so designed and maintained as to ensure as far as practicable the suppression of dust during the processes. (b) In premises which are constructed or reconstructed after the date of these Regulations the mixing or blending by hand of asbestos shall not be done except in a special room or place in which no other work is ordinarily carried on. The interpretation and application of the 1931 Regulations 150. Questions are raised in this appeal as to the scope of the 1931 Regulations: in particular, whether they applied to the power station by virtue of the activities carried on there by the laggers, and whether they imposed a duty which was owed to Mr McDonald. 151. In order to decide whether the Regulations applied to the power station, it is necessary in the first place to consider whether asbestos, as defined, was used by the laggers working there. There is no direct evidence (other than that of Mr McDonald) as to the composition of the material that they used. It appears however from expert evidence given at the trial that insulation materials containing opened or fiberized asbestos were widely used until the 1960s for lagging boilers and pipework. Such materials commonly contained 15% fiberized asbestos, mixed with other substances such as calcium silicate or cement. The insulation material could be either pre formed, or mixed with water and applied in the form of a paste. Pre formed sections were sawed by hand in order to profile them for fitting. The mixing of the paste involved bags of powdered insulation material being emptied into open topped containers for mixing with water. 152. Having regard to that evidence, it appears likely, on a balance of probabilities, that the insulating material used by the laggers was an admixture containing fiberized asbestos, and was therefore asbestos as defined by the Regulations. The question then arises whether the activities of the laggers fell within the ambit of the Regulations. 153. Considering the preamble defining the scope of the Regulations, paragraphs (ii), (iii), (iv) and (v) do not apply: each of them is concerned with the manufacture or repair of products composed wholly or partly of asbestos. Paragraph (vi) is also inapplicable: it is concerned with the cleaning of appliances used for the collection of dust produced in the processes described in paragraphs (i) to (v). The only remaining possibility is paragraph (i), and in particular the mixing of asbestos. Do those words include the mixing in a power station of insulation material, containing fiberized asbestos, with water? 154. As noted earlier, paragraph (i) of the preamble concerns breaking, crushing, disintegrating, opening and grinding of asbestos, and the mixing or sieving of asbestos, and all processes involving manipulation of asbestos incidental thereto. That provision uses a number of ordinary English words, such as opening and mixing, but it is apparent that some of them, at least, are being used in a technical sense embedded in the industrial practice of that period. Opening asbestos, for example, is evidently different from opening a window, or opening an account. Some guidance as to the meaning of paragraph (i) can be obtained from the Regulations themselves, and other assistance from the reports which preceded their introduction. 155. I shall discuss the reports at a later point, but it may be helpful to anticipate that discussion to the extent of summarising what is said in the reports about some of the terms found in the Regulations. In summary: i) Opening asbestos means splitting the raw mineral into fibres. ii) The first stage in the opening or fiberizing of asbestos is for the mineral to be crushed. This flattens out and breaks up the mineral. iii) After crushing, the mineral is sieved, for the purpose of grading it, prior to its being opened. iv) Waste asbestos products are fiberized by being disintegrated or broken up. v) Mixing can take place at three stages within the asbestos industry (an expression which I shall define in the next paragraph). Before crushing, the contents of several sacks of the raw mineral may be mixed on the floor beside the crushing machine. This is described as rough mixing. After crushing, the crushed material may be mixed prior to being opened. This is referred to as mixing or blending. After opening, the fiberized asbestos may be mixed with other materials in order to produce a variety of asbestos products, including insulation materials. At all these stages, the mixing may be done by hand or mechanically, although in 1931 mixing or blending in the asbestos textile industry was normally carried out by hand. vi) Grinding can refer to a method of cleaning machinery used for the carding of opened asbestos, or to a process used to trim and smooth asbestos products which have been cut or sawn. 156. It appears from this summary that the terms used in paragraph (i) are related, in that they all describe processes employed in the early stages of producing products composed wholly or partly of asbestos. I shall refer to factories and workshops where such products are made as the asbestos industry, reflecting the title of the 1931 Regulations. It is important to bear in mind, first, that that description encompassed in 1931 the production of a very wide range of products of which asbestos formed a component, as I shall later explain in greater detail, and secondly, that factories where such products were made were not necessarily devoted wholly or mainly to their manufacture. 157. The Regulations themselves also suggest a relationship between the processes grouped together in paragraph (i) of the preamble. That is consistent with regulation 1(a)(i), which groups together preparing (defined as meaning crushing, disintegrating, and any other process in or incidental to the opening of asbestos), grinding and dry mixing. In each of these contexts, the principle of interpretation, noscitur a sociis, suggests that mixing was a process related to other processes carried on by the asbestos industry, in the wide sense in which I have used that expression, rather than a process carried on in any premises where use was made of insulation materials containing asbestos that required to be mixed with water. 158. In my view, seven other considerations support this interpretation of the term mixing as used in paragraph (i) of the preamble and regulations 1 and 2: i) Extending the noscitur a sociis principle beyond paragraph (i), all the other processes contemplated by paragraphs (ii) to (vi) are undoubtedly processes carried on in the course of manufacturing or repairing asbestos products of different kinds. It follows that if paragraph (i) applied to any factory or workshop, of any kind, where insulating materials containing asbestos were mixed with water to form lagging paste, it would have a far wider scope than the other paragraphs. Indeed, given the expert evidence that insulating materials containing asbestos were in common use when the first part of the power station was built, between 1929 and 1935, paragraph (i) of the preamble would on that basis extend the scope of the Regulations to a substantial proportion, if not the majority, of the factories and workshops in the United Kingdom. ii) If paragraph (i) of the preamble was intended to encompass the mixing of insulation materials containing asbestos with water in any factory or workshop, so that the 1931 Regulations would not be confined to the asbestos industry as I have described it, it would defy logic that paragraph (v) should apply only when the specified processes are carried out in the manufacture of asbestos articles. Since the processes listed in that paragraph would give rise to asbestos dust whether they were carried out in the manufacture of such articles or not, it would be nonsensical to restrict the scope of paragraph (v) unless paragraph (i) were similarly restricted. To give a concrete example, Mr McDonald described being in the proximity of asbestos dust generated by the sawing of pre formed sections of insulation containing asbestos. That activity does not fall within the scope of the 1931 Regulations, because the articles are not being sawed in the manufacture of such articles, and paragraph (v) therefore does not apply. That being so, what logic would there be in the mixing of the lagging paste falling within paragraph (i)? iii) The interpretation of paragraph (i) of the preamble which I have suggested is consistent with the title of the Regulations: the Asbestos Industry Regulations. That title makes sense if the Regulations apply to factories and workshops producing products composed wholly or partly of asbestos. If on the other hand paragraph (i) were construed as applying to any factory or workshop where asbestos based lagging materials were used, that title would be inappropriate and misleading. iv) When regulation 1(a)(i) refers to mixing machines, it is clear that it is concerned with mixing in the context of manufacturing: regulation 1(a) expressly applies to manufacturing and conveying machinery. That is also consistent with the other types of machinery described in regulation 1(a), which are all employed in the asbestos industry as I have described it. If regulation 2 is understood as being concerned with mixing or blending by hand in the asbestos industry, paragraph (b), which requires the provision of a dedicated room for mixing or blending by hand of asbestos, can be seen to be related to a number of other regulations which make similar provision in relation to particular processes, or particular plant, employed in that industry: for example, the making or repairing of insulating mattresses composed wholly or partly of asbestos (regulation 3(i)), storage chambers or bins for loose asbestos (regulation 4(a)), and chambers or apparatus for dust settling and filtering (regulation 4(b)). v) vi) To give regulation 2(b) a wider interpretation would have consequences for industry generally which would be so inconvenient that it is difficult to imagine that they were intended. In particular, if the mixing of insulation materials containing asbestos with water, in order to form the paste widely used to insulate pipework and boilers, constituted mixing or blending of asbestos, it follows that any factory or workshop where lagging of that kind was used, constructed after 1931, would have to have a room dedicated to the exclusive use of laggers. It seems unlikely that the Secretary of State can have intended to impose that burden upon industry, and there is no indication that anyone ever supposed that the Regulations had that effect. vii) Finally, it is important to bear in mind that non compliance with the Regulations was a criminal offence, by virtue of section 85 of the 1901 Act. In dubio, penal legislation should normally be construed narrowly rather than widely. 159. If the mixing of lagging paste is not mixing within the meaning of paragraph (i) of the preamble, is it nevertheless one of the processes involving manipulation of asbestos incidental to the processes mentioned in that paragraph? Clearly not. Although the mixing of lagging paste might involve the manipulation of asbestos, that manipulation would not be incidental to one of the processes mentioned in paragraph (i). 160. As against the analysis set out above, it has been argued that the first proviso to the preamble to the Regulations implies that their application cannot be restricted to the asbestos industry. It is said to be very difficult to imagine a factory or workshop whose main business was producing products composed wholly or partly of asbestos to which the exemption could possibly apply, given that only certain processes, occasionally carried on, are exempted, and only then if none of the other defined processes is carried on in the same factory. I shall consider this argument at a later point. The letter dated 15 September 1931 161. Further assistance in the interpretation of the 1931 Regulations can be obtained from two reports which preceded them. The relationship between the Regulations and the reports was explained in the Home Office letter dated 15 September 1931, to which I referred earlier. 162. The letter explained that the proposed regulations followed upon an inquiry conducted by the Factory Department of the Home Office, whose report, Effects of Asbestos Dust on the Lungs and Dust Suppression in the Asbestos Industry was published in 1930 (34 206, HMSO). That report has been referred to in these proceedings as the Merewether and Price Report. The letter stated that Part II of the Report had recommended a number of precautionary measures for the prevention of inhalation of asbestos dust by workmen employed in the industry, the most important of which was the use of exhaust ventilation in both the textile and non textile sections of the industry. 163. The letter went on to state that it was evident from the Report that further inquiry would be necessary before a decision could be reached as to the best methods to be applied to the various machines in use. A conference was therefore arranged with representatives of the asbestos textile industry and, as a result, a committee consisting of representatives of the manufacturers and of the Factory Inspectorate was set up to consider the best methods for the suppression of dust in this section of the industry. That committee made a series of recommendations in its report, Report on Conferences between Employers and Inspectors concerning Methods for Suppressing Dust in Asbestos Textile Factories, published in 1931 (35 214, HMSO). I shall refer to that report as the Conferences Report. 164. The letter explained that the Secretary of State had decided to give effect to the recommendations contained in these two reports, and that the draft regulations generally followed the provisions recommended, with some additions and modifications. The Merewether and Price Report 165. The Merewether and Price Report is of great assistance in understanding the processes to which the Regulations referred, the terminology used in the Regulations, and the mischief which the Regulations were intended to address. For these reasons, I shall consider the Report, and the subsequent Conferences Report, in greater detail than would otherwise be appropriate. 166. As its title indicates, the Merewether and Price Report was concerned with the asbestos industry. It reported the results of an investigation which was instituted, following the discovery in 1928 of fibrosis of the lungs in an asbestos worker named Seiler, in order to determine whether the supervention of this disease in an asbestos worker was an exceptional occurrence, or evidence of a grave health risk in the industry. (p 5). 167. While the object of the investigation concerned the asbestos industry generally, the nature of the investigation necessitated a focus upon workers as nearly as possible exposed to pure asbestos dust: that is to say, those employed in the textile branch of the industry, those employed in the branch manufacturing insulating materials from practically pure asbestos, and those employed in some preliminary processes in other branches. The results were analysed on a number of bases, including the processes in which the workers were employed. For that purpose, a number of different processes within the asbestos industry were identified, and similar processes were grouped together. The first group of similar processes was crushing, opening, disintegrating and mixing (p 11). The implication is that mixing was a process within the asbestos industry, related in a relevant way to crushing, opening and disintegrating. That is consistent, as I have explained, with the grouping of these processes together in paragraph (i) of the 1931 Regulations and in regulation 1(a). 168. Processes were also grouped together for the purpose of determining the levels of dust which they generated. For that purpose, one group was opening and handling fibre, without local exhaust ventilation. This group was described as including opening, sieving, shovelling or otherwise handling asbestos fibre, and sack filling by hand in a settling chamber (p 12). Opening and sieving both fall within the ambit of paragraph (i) of the Regulations, as I have explained, and shovelling or otherwise handling asbestos fibre, and sack filling by hand, would also appear to fall within paragraph (i) as processes involving manipulation of asbestos incidental thereto. Manipulation of asbestos by hand and the filling or emptying of sacks also fall within the ambit of regulation 1(d) and (e) respectively. 169. Analysing the statistics in this way, it was concluded: i) ii) that there was a correlation between the dustiness of processes, and the length of time during which workers were employed in those processes, and the incidence of fibrosis; and that it seems necessary for the production of generalised fibrosis of the lungs that a definite minimal quantity of dust must be inhaled, with the important implication that the reduction of the concentration of dust in the air in the neighbourhood of dusty asbestos processes will cause the almost total disappearance of the disease (p 15). The outcome of the investigation was thus to establish the existence of a definite occupational risk in the asbestos industry (p 16). The risk took the form of a distinct type of fibrosis of the lungs (p 16). It was found that the incidence rate is highest in the most dusty processes and amongst those longest employed (p 17). 170. Part II of the report contained the recommendations to which the letter of 15 September 1931 referred. It began by noting the recent development and rapid expansion of the asbestos industry, mainly because of the demands of other industries, and the increasing attention paid to the insulation of steam plant to promote fuel economy (p 18). Asbestos products were divided for convenience into seven main groups: Textiles (a) Yarn and cloth. Non Textiles (b) Millboard, paper, asbestos cement sheets, tiles, and other building materials, sheet material of rubber or bituminous mixtures containing asbestos. (c) Insulation materials and articles. (d) Brake and clutch linings. (e) Packing and jointings. (f) Asbestos covered electric conductors electrodes, cables and wiring, coils for electric machinery. (g) Miscellaneous, including moulded electrical and other goods, etc. (p 18) 171. In relation to group (a), the Report noted that some asbestos textile products were produced for use in the manufacture of other products, including products in groups (c), (d), (e), (f) and (g) (p 19). In relation to group (c), the Report stated: Insulation materials include fiberized asbestos; magnesia, so called containing about 15% of fiberized asbestos and 85% of magnesia, and other finely divided mixtures composed partly of fiberized asbestos, used as insulating cements or plasters; fiberized asbestos stiffened into thick sheets, like mats, for lining bulkheads of ships; shaped sections and slabs, moulded from fiberized asbestos or mixtures containing it, or built up of corrugated asbestos paper so as to enclose air cells; mattresses, made of asbestos cloth and filled with fiberized asbestos, magnesia, or other filling. (p 19) 172. The Report noted that work involving the use of asbestos products was carried on in other premises besides factories, the most important being insulation work, much of which was carried on by contractors (p 19). The Report did not discuss any risks which might be associated with such work, which could only have been fully addressed by legislation of wider scope than regulations made under the Factories Acts. 173. Some conclusions can be drawn from this discussion about the sense in which the Report referred to the asbestos industry. As the groups of products indicate, it comprised factories and workshops which manufactured products (or repaired insulating mattresses) composed wholly or partly of asbestos. The manufacturing process employed at the factory did not however necessarily involve the use of the raw mineral. It might, as at factories producing articles in group (a), or it might not, as at factories producing articles in group (e). Nor did the manufacturing process necessarily involve the use of fiberized asbestos: as the Report stated, fiberized asbestos was used in large quantities in the manufacture of groups (a) to (c), but to a much smaller extent in some of the other factories and workshops (p 19). As I shall explain, the factory might therefore be one where substantial quantities of asbestos dust were produced, or it might not. 174. In relation to the processes and preventive measures required, the Report focused on the dust producing processes. In relation to group (a), the Report stated: Asbestos, suitable for yarn, has usually to be crushed, and in all cases opened (fiberized) before it is ready for carding. These preparatory processes are effected by machinery, but entail much handwork. Separating (to remove iron) and grading or sieving follow crushing, but precede opening. Material for yarn is not usually treated in disintegrators, but in most factories these machines are used for fiberizing waste asbestos yarn, etc. Crushing flattens out and breaks up the mineral without damaging the fibres. It is accomplished either in a large edge runner, or in a small pan mill of the mortar mixing type. The material is emptied upon the floor close to the machine, the contents of several sacks sometimes being spread on the floor to obtain a rough mixing. (pp 20 21) This description of the preparatory processes encompasses crushing, disintegrating, opening, sieving and rough mixing. 175. Mixing or blending of the crushed asbestos was a further process, preparatory to carding: Crighton openers, enclosed centrifugal machines, are used for opening crushed asbestos, preparatory to carding. Careful mixing or blending of crushed material is effected by spreading it evenly in layers on the floor over a considerable area cotton may be added at this stage if required and when feeding, taking a vertical cut through the mass Mixing is a great hindrance to elimination of hand work; it is asserted that poor yarn results if it is not done and that machine mixing has been tried and gave less satisfactory results. If retained, it should be done at a higher level than the opener, under a large exhausted canopy and the mixture fed at a series of chutes. (p 21). One sees here the alternatives addressed in the Regulations mixing machines, dealt with in regulation 1(a), and mixing or blending by hand, dealt with in regulation 2 and the background to the requirement that they should each be carried on with an exhaust draught. 176. In relation to the non textile sector, the Report noted that fiberized asbestos was not used in some of the factories, and that exposure to dust might be slight or even negligible (p 26). Fiberizing was almost exclusively confined to works in groups (b) and (c), ie works manufacturing millboard and similar products, and works manufacturing insulation materials. Dust was evolved in factories or departments where fiberized asbestos was prepared for subsequent use or for sale, and also in departments where fiberized material, or dry mixtures containing it, were manipulated in preliminary manufacturing processes. Finishing processes involving abrading or cutting could also be a source of dust, but such dust might contain only a small percentage of asbestos. 177. In relation to group (c), the Report explained that fiberized asbestos was a component of many insulating materials which might also contain other materials. It stated: In many small works the materials are mixed dry, by hand, in an open manner, involving sack emptying and filling, shovelling and weighing. Enclosed rotary mixers could apparently be used for such work with exhaust applied at feeding points and the material discharged and bagged under enclosed conditions. If hand work is retained, exhaust should be applied. (p 27) 178. The mixing of fiberized asbestos with other materials was also an aspect of the manufacture of some products in groups (f) and (g). In particular, the production of moulded goods could involve the mixing of asbestos paste using dry materials. The mixing of asbestos putty also involved the handling of dry materials (p 30). 179. Relating this discussion to the preamble to the Regulations, it will be recalled that the first proviso excludes the application of the Regulations to any factory or workshop, or it is important to note any part of a factory or workshop, where any of the following processes is carried on: (1) the process of mixing asbestos; (2) the repair of insulating mattresses; (3) sawing, grinding, turning, abrading and polishing, in the dry state, of articles composed wholly or partly of asbestos in the manufacture of such articles; and (4) any cleaning of machinery or other plant used in connection with any such process. The exclusion is subject to two conditions. First, the process or work must be carried on occasionally only, and no person must be employed in it for more than eight hours a week. Secondly, no other process specified in the preamble to the Regulations must be carried on in the place in question. 180. It is difficult to envisage circumstances in which the proviso would apply to factories or workshops producing goods in groups (a), (b) or (c), since, even if there were parts of such factories where only the activities mentioned in the proviso were carried on, it seems unlikely that those activities would be carried on only occasionally. In some factories producing goods in groups (e), (f) and (g), on the other hand, the position might be different. Given the variety of products which such factories might produce, and the variety of processes involved, it is possible to envisage situations where the first or second proviso might apply. Such factories might for example produce a range of goods, most of which did not include asbestos, but which required the occasional mixing of asbestos, or some other process, such as grinding, or the repair of insulating mattresses, which was mentioned in the proviso. The report contains little discussion of factories of that kind, since for obvious reasons it focused upon factories where the risk to health from asbestos dust was greatest. The point is however illustrated by the discussion of factories producing cable and wiring, of which the report stated: Asbestos covered cable and wiring constitutes a small percentage of the output of the cable factories The amount of dust evolved is small, and special precautionary measures are apparently not required. (p 30) 181. Returning to the Report, the section headed Summary and Recommendations began by noting that asbestos factories and workshops cover a great variety of processes (p 31). It observed that the asbestos manufacturers were confronted with the necessity of attaining conditions in their industry which would ensure much less dust in the atmosphere than could be tolerated in many comparable trades not using asbestos (p 31). As in the remainder of the Report, the focus of the recommendations was entirely on the asbestos industry, using that expression in the sense that I have explained. 182. The specific recommendations foreshadow the provisions of the Regulations. In particular, regulation 1(a) reflected recommendation 1(a), which was that exhaust ventilation should be provided for: Dust producing machines, eg (i) Crushing, disintegrating, teasing and other opening machines; sieving machines; fibre grinding machines; dry mixing machines; rolls fed with dry mixings. Regulation 2(a) was one of a number of regulations that reflected recommendation 1(e), which was that exhaust ventilation should be provided for: Various hand operations, eg sack emptying and filling, weighing, mixing Regulation 2(b) was one of a number of regulations that reflected recommendation 7, which was that new factories should be laid out so as to avoid exposing workers to risk from processes upon which they were not engaged. The Conferences Report 183. The Conferences Report was prefaced by a letter from the Chief Inspector of Factories to the Home Secretary dated 10 April 1931, which explained that the recommendations reflected an important assumption, namely the existence of a critical limit of dust concentration below which workers may be employed without injury to health. As I have explained, that assumption is contradicted by more recent knowledge. 184. In the introductory section of the Report, it was noted that successful experiments had been carried out involving the application of exhaust to various processes, including mixing and blending (in opening processes) (p 6). It was also noted that the safe concentration of dust in workrooms had been taken, on the basis of the Merewether and Price Report, to be the conditions arising from flyer spinning of asbestos fibres. That criterion was said to be simple to apply to processes such as mixing, blending which are obviously more dusty than flyer spinning (p 6). The recommendations focused upon the application of exhaust ventilation at dust producing points, so as to meet that criterion. 185. The body of the Report set out the agreements arrived at. They were listed under headings, mostly descriptive of particular processes. The first heading was Crushing, including preliminary Sack Emptying, Rough Mixing on Floor near Crushers, Feeding and Discharging. Rough mixing of raw asbestos prior to crushing was therefore included within crushing. It was agreed that a mechanical exhaust draught should be applied. This is reflected in regulation 1(a), which requires mechanical exhaust ventilation which prevents the escape of asbestos dust to be applied to preparing, defined as meaning crushing, disintegrating and any other process in or incidental to the opening of asbestos. 186. The second heading was Mixing and Blending of Crushed Asbestos. It was agreed that this process, which was at the time carried on by hand in the textile industry, should also be subject to mechanical exhaust ventilation. Such ventilation had recently been applied by using an exhaust pipe above the mixing area. Although much dust was removed, it was unclear whether this arrangement would fully meet the case. That is reflected in regulation 2(a), which requires mixing or blending by hand of asbestos not to be carried on except with an exhaust draught so designed and maintained as to ensure as far as practicable the suppression of dust. Although it is not discussed in the Report, one might infer that it was because of the limited efficacy of exhaust ventilation of mixing or blending by hand that regulation 2(b) requires the provision of a dedicated room for that activity in premises constructed after the date of the 1931 Regulations. It was also noted in the Report that enclosed mixing machines might be developed in the future. That possibility was addressed by regulation 1(a), in so far as it applies to dry mixing machines. Further agreements dealt with other specific processes used in the asbestos textile industry. In each case, a relationship can be seen between the agreement and a corresponding provision of the Regulations. 187. The Report did not deal with the mixing of opened asbestos with other materials: as I have explained (and as was noted in the Report, in its discussion of mattress making), mixtures of asbestos and other materials were not normally used in the textile branch of the asbestos industry. The mixing process involved would however fall within the ambit of either regulation 1(a) or regulation 2, depending on whether the mixing was carried out mechanically or by hand. Did the 1931 Regulations in general, and regulation 2(a) in particular, apply? 188. In summary therefore, it could hardly be clearer, when regard is had to (1) the Reports which preceded the certification under section 79 of the 1901 Act, (2) the terms of that certification, (3) the recommendations which the 1931 Regulations were intended to implement, and (4) the terms of the Regulations themselves, that the Regulations in general did not apply to the power station by virtue of the work being carried on there by the laggers, and that regulation 2(a) in particular did not apply to that work. In the first place, the Regulations applied only to factories and workshops in which one or more of the processes listed in the preamble was carried on: the term mixing, as employed in paragraph (i) of the preamble, had a technical meaning, and described particular processes carried on in the asbestos industry. Those processes were, first, mixing or blending of crushed asbestos preparatory to its being opened, and secondly, mixing of opened asbestos with other materials as part of the process of manufacturing asbestos products such as the insulation material used by laggers. Those processes were not carried on at the power station. The Regulations therefore did not apply to it: it was not a place where mixing, within the meaning of paragraph (i), was carried on. Secondly, for the same reason, regulation 2(a) did not apply to the work carried on by the laggers, as it did not involve mixing or blending by hand of asbestos within the meaning of the Regulations. The authorities 189. That conclusion is consistent with the authorities in which the scope of the 1931 Regulations has been considered. It appears to have been only in relatively recent years that any suggestion was made that the Regulations might apply in circumstances such as those of the present case. The point was however argued in the case of Banks v Woodhall Duckham Ltd, Court of Appeal (unreported), 30 November 1995, which concerned a pipe fitter who suffered injury after being exposed to asbestos dust while working in various premises. They included a steel works where he was exposed to dust created by laggers using insulation materials containing asbestos, which they mixed with water to create a paste. A claim under the 1931 Regulations failed, in the first place, because the claimants evidence was rejected. The court also accepted submissions to the effect that the Regulations were concerned with processes carried on in the asbestos industry, understood as meaning processes in the manufacture of asbestos products, and processes preliminary to such manufacture, and did not apply to the lagging of pipes in the steel industry. 190. The same conclusion was reached by Lord Gill in the Outer House of the Court of Session in Watt v Fairfield Shipbuilding & Engineering Co Ltd 1999 SLT 1084, in which the pursuer had been exposed to asbestos dust while working on board ships under construction in shipyards. As in the present case, the source of the dust was insulation material. Lord Gill considered that the Regulations related to those processes by which the raw material was treated in the course of its being manufactured into asbestos products of various kinds. That was also the interpretation for which the appellants argued in the present appeal. Although I agree with Lord Gills decision on the facts of the case, I would not define the scope of the Regulations as narrowly as that: as I have explained, the asbestos industry is not confined, for these purposes, to factories or workshops where the raw mineral is treated, but includes, for example, those which manufacture products classified in the Merewether and Price Report as falling into groups (d), (e) and (f). 191. The first case in which a detailed consideration of the background to the Regulations was undertaken was Cherry Tree Machine Co Ltd v Dawson (sub nom, Jeromson v Shell Tankers (UK) Ltd) [2001] EWCA Civ 101; [2001] ICR 1223. So far as relevant, the case concerned a claim under the 1931 Regulations arising from a persons employment in a factory which manufactured dry cleaners presses. The manufacturing process involved the use of fiberized asbestos, mixed with water, to form a seal around the platens of the presses: the asbestos sealant was designed to prevent steam from escaping when the presses were used. An appeal by the employer against a finding of liability under regulation 2 was dismissed. 192. That conclusion is consistent with my interpretation of the Regulations. The presses were, in the language of the Regulations, articles composed partly of asbestos. The mixing of asbestos in the factory formed part of the process of manufacturing the presses. As Hale LJ observed at para 11, the process was similar to the asbestos putty mixing which had been mentioned in the Merewether and Price Report. 193. Hale LJ also observed at para 20 that the scope of the Regulations is not confined to factories and workshops whose only or main business is the processing of raw asbestos or the manufacture of products made out of raw asbestos, as Lord Gill had considered in the case of Watt. She accordingly rejected a submission that the Regulations applied only to the asbestos industry, understood in the sense which Lord Gill had favoured. As she observed at para 20, nowhere in the Regulations was it said that they applied only to factories and workshops whose only or main business was the processing of raw asbestos or the manufacture of products made out of raw asbestos. Furthermore, as she observed at para 22, the Merewether and Price Report clearly contemplated the mixing of asbestos in the manufacture of a wide variety of products, not just asbestos products in the narrow sense that had been argued for. 194. I respectfully agree with that interpretation of the Regulations. As I have explained, the construction favoured by Lord Gill would be inconsistent with the intention to implement the recommendations of the Merewether and Price Report, since it would effectively confine the scope of the Regulations to groups (a) to (c) of the factories and workshops mentioned in the Report, and leave groups (d) to (g) out of account. The broader understanding of the asbestos industry which I have explained is also important in understanding the provisos to the preamble to the Regulations: since the Regulations applied to all factories or workshops any part of whose business was the making of asbestos products (or the repair of insulating mattresses), the enactment of a proviso exempting factories or workshops, or parts of them, which carried out certain types of work only occasionally is not difficult to understand. 195. Hale LJ was also critical of the observations made in Banks, and followed in Watt, to the effect that the Regulations did not apply to the mixing of lagging paste by laggers. As I have indicated, her criticisms of the reasoning in those cases were well made, and were necessary to her decision: in particular, her rejection of the argument that the Regulations were confined to processes involving the use of raw asbestos. In so far as her observations went beyond what was necessary for the decision of the appeal, and suggested that it was more likely (para 25) that the Regulations applied to the mixing of lagging paste by laggers, they were obiter, and I would respectfully take a different view, for the reasons I have explained. 196. In the present case, it was argued before the Court of Appeal, as before this court, that mixing, within the meaning of the 1931 Regulations, meant mixing prior to opening (ie what I have described as rough mixing and mixing or blending), but did not include the mixing of fiberized asbestos with other substances. On that basis, it was argued that the case of Cherry Tree had been wrongly decided. McCombe LJ, with whose reasoning on this matter the other members of the court agreed, saw force in the submission, but considered that the court was bound by the decision in Cherry Tree. 197. As I have explained, I construe the term mixing, in the light of the Merewether and Price Report and its recommendations, as including mixing prior to opening, but also as including the mixing of fiberized asbestos with other substances, provided it is carried out by the asbestos industry: that is to say, provided it forms part of the process of producing a product composed wholly or partly of asbestos. On that basis, the case of Cherry Tree appears to me to have been correctly decided, as I have explained. The decision (as distinct from some observations which were strictly obiter) does not however entail that the work of laggers falls within the scope of the Regulations. Consistently with the decisions (as distinct from some of the reasoning) in Banks and Watt, I consider that such work is beyond the scope of the Regulations. Subsequent legislation 198. It is noteworthy that subsequent legislation was made on the basis of the understanding of the 1931 Regulations which I have explained. In 1967 the Ministry of Labour and HM Factory Inspectorate published a memorandum, Problems arising from the use of Asbestos (36 316), which noted that the Regulations applied to around 300 factories. In the majority of those factories, only a very small proportion of employees were employed on asbestos processes. The principal forms of employment subject to the Regulations were said to be the production of asbestos cement products, asbestos textiles and brake linings for motor vehicles (para 10). 199. A table listed factories and warehouses handling asbestos where the Regulations did not apply. These included electricity generating, where the relevant activity was identified as lagging and de lagging (Table 4). The same table also listed generating stations amongst the places where contractors carrying out work involving the use of asbestos could be found. The memorandum stated in terms that the Asbestos Industry Regulations do not apply to lagging and insulation operations using asbestos (para 13). It noted that other employees working in the neighbourhood of lagging and insulation operations must also undergo considerable exposure to asbestos (para 13). The memorandum referred to evidence of an increasing incidence of asbestosis, particularly amongst laggers, who tended to be excluded from the scope of the Regulations (para 18). It also referred to evidence linking exposure to asbestos to various types of cancer, including mesothelioma. 200. The Government responded by informing Parliament that it intended to introduce regulations to cover all the industries and processes in which asbestos is used, including occupations such as lagging and de lagging, thermal and sound insulation (Hansard, 10 July 1967, col 88). The 1969 Regulations were subsequently made. They applied specifically to electrical stations (regulation 3(1)) as well as to a wide range of other premises. They applied to every process involving asbestos or any article composed wholly or partly of asbestos, except a process in connection with which asbestos dust cannot be given off (regulation 3(2)), and imposed obligations on employers as well as occupiers (regulation 5(1)). 201. This material cannot be used as an aid to the interpretation of the 1931 Regulations. It is nevertheless a matter of legitimate comment that the interpretation of the Regulations which is favoured by Lord Kerr is inconsistent with the basis on which the 1969 Regulations were made. Was Mr McDonald within the scope of the 1931 Regulations in any event? 202. The parties addressed the question whether, even assuming that the 1931 Regulations applied to the activities of the laggers at the power station, any duty was owed to Mr McDonald, since he was not employed in the process which generated asbestos dust. 203. The Regulations were made under section 79 of the 1901 Act, the terms of which have been quoted. That Act was repealed by the 1937 Act, which however contained a saving proviso in section 159(1), the effect of which was that the 1931 Regulations were deemed to have been made under section 60(1) of the 1937 Act. The 1937 Act was in turn repealed by the Factories Act 1961 (the 1961 Act), which contained a similar proviso in paragraph 1 of Schedule 6. The result was to deem the 1931 Regulations to have been made under section 76(1) of the 1961 Act, which provides: Where the Minister is satisfied that any manufacture, machinery, plant, equipment, appliance, process or description of manual labour is of such a nature as to cause risk of bodily injury to the persons employed or any class of those persons, he may, subject to the provisions of this Act, make such special regulations as appear to him to be reasonably practicable and to meet the necessity of the case. 204. In Canadian Pacific Steamships Ltd v Bryers [1958] AC 485, the House of Lords took as its starting point, in deciding whether the plaintiff fell within the scope of regulations made in 1931 under section 79 of the 1901 Act, the terms of section 79 itself, on the basis that the 1937 and 1948 Acts could not give a wider meaning to the regulations than they had borne when they were made (it was assumed that the power conferred by section 60(1) of the 1937 Act as amended was no narrower than the power conferred by section 79 of the 1901 Act). Section 79 of the 1901 Act was construed as empowering the Secretary of State to make regulations which enured for the benefit of persons employed in the factory, even if they were not employed in the process which caused the danger or injury to health or the danger to life and limb and thus brought about the certificate. As Viscount Kilmuir LC observed at p 501, it was obvious that such a process, unless regulated, might be dangerous to others whose ordinary work in the factory brought them into regular proximity to the danger. 205. Bearing in mind that the Regulations are now deemed to have been made under section 76(1) of the 1961 Act, the position is equally clear: that section refers generally to the persons employed, a form of words which was considered in the Canadian Pacific Steamships case to enable regulations to be made which protected persons who were employed in the factory but not in the relevant processes. There is nothing in the Regulations themselves that indicates an intention to restrict the scope of the duty to those directly engaged in the specified processes. Such an intention appears unlikely, since the Merewether and Price Report had made it clear that the risk to health caused by asbestos dust was not confined to those directly employed in the relevant process, but also affected other workers in the same workroom. 206. It was also argued in the present appeal that no duty was owed to Mr McDonald in any event, since he was not a person employed in the power station. It will be necessary to return to that question in the context of the duty imposed by section 47(1) of the 1937 Act. Part 3: Section 47(1) of the 1937 Act 207. It is necessary next to consider the cross appeal, which concerns the effect of section 47(1) of the 1937 Act. It provides: In every factory in which, in connection with any process carried on, there is given off any dust or fume or other impurity of such a character and to such extent as to be likely to be injurious or offensive to the persons employed, or any substantial quantity of dust of any kind, all practicable measures shall be taken to protect the persons employed against inhalation of the dust or fume or other impurity and to prevent its accumulating in any workroom, and in particular, where the nature of the process makes it practicable, exhaust appliances shall be provided and maintained, as near as possible to the point of origin of the dust or fume or other impurity, so as to prevent it entering the air of any workroom. 208. Section 47(1) applies in two situations. The first is where there is given off any dust or fume or other impurity of such a character and to such extent as to be likely to be injurious or offensive to the persons employed. Mr McDonald did not pursue any case based upon that branch of the provision. The second situation is where there is given off any substantial quantity of dust of any kind. Mr McDonald relied upon that branch of the provision. Was there any substantial quantity of dust? 209. The first issue which arises is whether, on the evidence, it has been established that there was any substantial quantity of dust given off in the power station at any relevant time. In that regard, a difficulty arises for Mr McDonald from the absence of reliable evidence as to the quantity of dust given off during his visits to the power station. The trial judge made no finding on the point. The Court of Appeal concluded that, on the evidence, Mr McDonald had failed to establish that a substantial quantity of dust had been given off. This court does not in my view have a proper basis for reaching a different conclusion. It follows that the claim under section 47(1) must be rejected. Was Mr McDonald a person employed? 210. A further question which was argued was whether in any event any duty was owed under section 47(1) to Mr McDonald. Was he one of the persons employed, within the meaning of the section? It was argued on behalf of the appellants that he was not. Reliance was placed on the decisions of Rose J in Morrison v Central Electricity Generating Board (unreported), 15 March 1986, and of the Court of Appeal in Banks v Woodhall Duckham Ltd (unreported), 30 November 1995, where the view was taken, as a matter of grammatical analysis, that the words the persons employed, in section 47(1), referred back to the phrase in connection with any process carried on. That decision was followed by the Court of Appeal in the present case. 211. I am unable to agree with that construction. The verb which governs the preposition in, in the phrase in connection with any process carried on, is not employed but given off (in connection with any process there is given off). It is therefore the dust that must be connected to the process, rather than the persons employed. An alternative possibility, that the words the persons employed might refer back to the phrase in the factory, must also be rejected: the verb which governs the preposition in, in the phrase in every factory, is not employed but taken (in every factory all practicable measures shall be taken). 212. Greater assistance can be obtained from considering section 47(1) in the context of the 1937 Act as a whole. In the Morrison case, Rose J contrasted section 63 of the 1961 Act (the successor provision of section 47 of the 1937 Act) with section 14(1) (the obligation to fence dangerous machinery), which imposed a duty with regard to every person employed or working on the premises. The same contrast could also be drawn between sections 14(1) and 47(1) of the 1937 Act. On the other hand, as Buxton J observed in Owen v IMI Yorkshire Copper Tube (unreported), 15 June 1995, the difference between those provisions is less striking than the difference between section 47(1) of the 1937 Act and section 49. The latter provision, which is concerned with the protection of the eyes, imposes a duty in respect of the persons employed in the process. Given that sections 47 and 49 appear in the same group of sections, the use of that limiting phrase in one section but not in the other is a strong reason for believing that the scope of section 47(1) was not intended to be limited, by implication, in the same way as section 49 was limited by express provision. 213. Apart from these textual pointers, it is also necessary to consider what Parliament is likely to have intended. The phrase the persons employed identifies the persons to whom the statutory duty is owed. The duty is to take specified precautions in every factory in which, in connection with any process carried on, there is given off any dust or fume (or other impurity) of a particular description: either the dust or fume must be of such a character and extent as to be likely to be injurious or offensive to the persons employed, or the quantity of dust must be substantial. In such circumstances, there is a duty to take all practicable measures to protect the persons employed against inhalation of the dust or fume, and to prevent its accumulating in any workroom. 214. Considering first the situation where injurious or offensive dust or fumes are given off, it would not make sense for the duty to be confined by law to the persons employed in the process in question. Although those persons would be most directly exposed to the dust or fumes, and would therefore be at the greatest risk of harm, it is perfectly possible that other persons might also be liable to inhale the dust or fumes and would also be at risk. There might, for example, be other persons working in the workroom where the dust or fumes were generated a problem which had been highlighted by the Merewether and Price Report or persons who passed through the workroom in the course of their employment. If they inhaled the dust or fumes and suffered injury, why should they not fall within the scope of the statutory duty? To confine the duty in such a way as to exclude a priori a category of persons who were liable to suffer the injury sought to be guarded against would be inconsistent with the apparent intention to protect those at risk. 215. In the light of that consideration, and also the contrast between sections 47(1) and 49, the phrase the persons employed should not therefore be construed as being restricted to the persons employed in the process in connection with which the dust or fume is given off. The only feasible alternative is that the phrase is intended to refer to the persons employed in the factory. 216. If that is the correct construction of the phrase in its application to the first situation addressed by section 47(1), it seems to me that it must also be the correct construction in relation to the second situation, where a substantial quantity of dust is given off. There is nothing in the section to suggest that the phrase has two different meanings, depending upon which of the alternative situations exists. 217. The question then arises whether Mr McDonald was one of the persons employed in the power station. There are numerous authorities on the meaning of the phrase the persons employed, where used in the Factories Acts. It is clear that the phrase is not confined to the employees of the occupier of the factory: see, for example, Massey Harris Ferguson (Manufacturing) Ltd v Piper [1956] 2 QB 396, where it was held to extend to a painter, employed by an independent contractor, carrying out painting work in a factory. It does not however extend to a fireman who enters a factory in order to put a fire out (Hartley v Mayoh & Co [1954] 1 QB 383), or to a police constable who enters a factory in pursuit of a felon (Wigley v British Vinegars Ltd [1964] AC 307, 324 per Viscount Kilmuir), although he is a person and he is employed. In Canadian Pacific Steamships Ltd v Bryers [1958] AC 485, 504 Viscount Kilmuir considered that the phrase applied to any person who is employed in the factory whether the direct servant of the occupier or a servant of an independent contractor so long as he is employed upon work in that factory. Those words are however themselves little clearer than the statutory phrase. In the later case of Wigley v British Vinegars Ltd, concerned with a window cleaner employed by an independent contractor, Viscount Kilmuir said at p 324: In my view, the true distinction is between those who are to work for the purposes of the factory and those who are not. Clearly, maintenance of the factory is work for the purpose of the factory, while the arrest of a felon or the putting out of a fire is not, though it may benefit the factory indirectly. Window cleaning is part of the maintenance of the factory and in my view the deceased was within the protection afforded. The other members of the House agreed. 218. It can fairly be said that the test laid down in Wigley, like the differently expressed test laid down in the Canadian Pacific Steamships case, can result in the drawing of fine distinctions without any compelling rationale beyond the need to draw a line somewhere. The present case might be regarded as an example. It could be argued that Mr McDonald was employed for the purposes of the power station, either on the basis that one of those purposes was the sale of the ash, and he was employed collecting ash which had been sold, or on the basis that the ash was a by product which the power station had to dispose of, and he was employed removing it. The contrary view appears to me however to be more persuasive. Mr McDonald was not in reality working for the purposes of the power station. He was working solely for the purposes of his employer, the Building Research Establishment. It was the purchaser of the ash which was a by product of the power station, and it employed Mr McDonald to collect the ash in his lorry. A customer of a factory can hardly be regarded as working for the purposes of the factory, even if he goes there in person to collect the article purchased; and a person whom he employs to collect the article from the factory can hardly be in a different position. Although the sale of such articles would no doubt be one of the purposes of the factory, and the sales staff would therefore fall within the scope of the legislation, the collection of the articles by or on behalf of purchasers is not in the same position. 219. On that ground, as well as on the basis that it had not been proved that any substantial quantity of dust was given off, the Court of Appeal was correct to reject the claim under the 1937 Act. It also follows that the claim under the 1931 Regulations would have to be rejected for the same reason, even if, contrary to my conclusion, the Regulations had applied to the work being carried on by the laggers. Does a claim lie only if a substantial quantity of dust was inhaled? 220. A further issue which was argued is whether, as was maintained on behalf of Mr McDonald, a claim lies under section 47(1) whenever (a) a substantial quantity of dust is given off in connection with a process carried on in a factory, (b) there has been a failure to take all practicable measures to protect the persons employed against inhalation of the dust, and (c) a person employed has suffered injury caused by inhalation of dust given off by the relevant process. It was argued on behalf of the appellants that it was not enough that the injury should have been caused by the inhalation of any of the dust: in order to have a claim under the section, the dust must have been substantial in quantity at the point when it was inhaled by the claimant. 221. It was argued on behalf of the appellants that, as a matter of textual analysis, when section 47(1) imposed a duty to take all practicable measures to protect the persons employed against inhalation of the dust, those words could only mean the substantial quantity of dust said to give rise to the duty, with the implication that the duty was only to protect against inhalation of a substantial quantity of dust. 222. That argument appears to me to be fallacious. It is plainly correct that the words the dust refer to the substantial quantity of dust given off. There is therefore a duty to protect the persons employed against the inhalation of that dust. It does not however follow that the duty applies in respect of a particular person only if that person is individually liable to inhale a substantial quantity of the dust. One might as well argue that, if a manufacturer sold a substantial quantity of ginger beer which was contaminated with snails, and was under a duty to take precautions to prevent customers from consuming the ginger beer, it followed that the duty was only to protect against the consumption of a substantial quantity of the ginger beer. 223. It might alternatively be argued that the duty imposed by section 47(1) in respect of any substantial quantity of dust is in reality unlikely to have been intended to confer a right of action upon an employee who suffered injury as a result of inhaling an insubstantial quantity of dust. In support of that view, it might be said that Part IV of the 1937 Act, and section 47(1) in particular, are intended to protect the health of employees. Section 47(1) begins by addressing the situation where dust is given off of such a character and to such an extent as to be likely to be injurious to health. The part of section 47(1) concerned with any substantial quantity of dust cannot therefore be concerned with dust which is known to be inherently harmful to health, since that danger has already been addressed. Its concern must be the risk to health which exists where any dust is given off in substantial quantity. That risk derives from the high concentration of dust in the air which is inhaled. Once the dust has become dispersed in the atmosphere, that risk disappears. 224. This argument can be analysed: (1) as restricting the category of person to whom a duty is owed under the relevant limb of section 47(1) to persons employed who inhale dust which is substantial in quantity, or (2) as restricting the type of injury for which a claim can be brought under the relevant limb of section 47(1) to injury which is caused by the inhalation of dust which is substantial in quantity. The first is an argument about the scope of the statutory duty. The second is an argument about remoteness of damage. Each is in my opinion fallacious. 225. Considering first the scope of the duty, this has already been discussed. It depends on the meaning of the persons employed. For the reasons explained earlier, those words must refer to all the persons employed in the factory. 226. So far as remoteness is concerned, when Parliament enacted section 47(1) it imposed on employers a duty to take all practicable measures to protect the persons employed against inhalation of the dust, whenever any substantial quantity of dust was given off in connection with any process carried on in a factory, and imposed civil liability for a breach of the duty which caused injury. It did not impose liability only if the breach caused injury in a particular way. As Lord Reid said in Grant v National Coal Board [1956] AC 649, 661: I cannot see why it should matter just how the accident was caused provided that it was in fact caused by a breach of the section. I see no ground for imputing to Parliament an intention to make the mineowner liable for some of the consequences of breach but to relieve him of liability for others. 227. If therefore there was a breach of the duty imposed by section 47(1), in that a substantial quantity of asbestos dust was given off in connection with a process carried on in the power station and all practicable measures were not taken to protect the persons employed against inhalation of the dust, and if a person employed suffered physical injury caused by the inhalation of the dust, it cannot matter that the precise illness, or the way in which it was caused by the inhalation of the dust, was not foreseeable at the time when the statute was enacted: Hughes v Lord Advocate [1963] AC 837. 228. The point is illustrated by the case of Gregson v Hick Hargreaves & Co Ltd [1955] 1 WLR 1252, where the plaintiff had suffered illness as a result of inhaling noxious particles of silica which formed part of a substantial quantity of dust given off by a process. The presence of the silica, and its harmfulness, had not been known at the time. The defendants argument that they should not be held liable was rejected. Jenkins LJ observed at p 1266 that the duty of employers was to take all practicable measures to protect their workpeople from the inhalation of dust, and their duty to do that did not depend on the question whether the dust was known or believed to be noxious or not. 229. Finally, in relation to this branch of the appeal, I should record that no issue was raised as to whether the dust generated by the work carried out by the laggers in the power station was given off in connection with any process carried on there, within the meaning of section 47(1). Conclusion 230. For the reasons I have explained, I would allow the appeal and dismiss the cross appeal. 79. Mr Allan criticises these passages on a number of grounds. He submits that there was in fact clear and undisputed evidence that: (1) the insulation at this power station would have contained asbestos; (2) insulation work was undertaken at the power station which included mixing asbestos powder in oil drums, sawing pre formed sections and removing old lagging by ripping it off pipework; and (3) the activities of mixing asbestos powder, sawing asbestos sections and removing old lagging would generate high concentrations of asbestos dust which, on any view, would amount to substantial quantities of dust.

Between 1954 and March 1959 Percy McDonald attended Battersea power station in the course of his employment as a lorry driver for a firm known as Building Research Station to collect pulverised fuel ash. Between 1954 and January 1957 he was at the power station approximately twice a month but this fell to about twice every three months from January 1957. While at the power station as a casual visitor Mr McDonald went into areas where asbestos dust was generated by lagging work. The lagging work involved mixing asbestos powder with water in order to make a paste, as well as sawing preformed asbestos sections and stripping off old asbestos lagging. Mr McDonald was diagnosed as suffering from mesothelioma in July 2012 and sadly died at the beginning of February 2014. His widow, Edna McDonald, took his place as respondent in the appeal. The National Grid Electricity Transmission Plc (National Grid) is the successor body to the occupiers of the power station. At trial, Mr McDonald alleged that those occupiers had been in breach of their statutory obligations under regulation 2(a) of the Asbestos Industry Regulations 1931 (the 1931 Regulations) and section 47 of the Factories Act 1937 (the 1937 Act). He also brought claims in negligence against the successors to his former employers and National Grid, but these claims were dropped before the matter came to the Supreme Court. The trial judge dismissed all Mr McDonalds claims. On appeal, the Court of Appeal allowed Mr McDonalds appeal under the 1931 Regulations but dismissed his appeal under the 1937 Act. National Grid appeals to the Supreme Court in the first appeal and Mr McDonalds representative cross appeals in the second appeal. The Supreme Court dismisses National Grids appeal and dismisses the cross appeal. On the appeal, the decision was by a majority of three (Lord Kerr gives the lead judgment and Lady Hale and Lord Clarke give concurring judgments) to two (Lord Reed, with whom Lord Neuberger agreed). On the cross appeal, the decision was by a majority of four to one, with Lady Hale in the minority. On the first appeal, the majority conclude that the 1931 Regulations apply to all factories and workshops processing asbestos, not just those dealing with asbestos in its raw, unprocessed condition. The clear wording of the Regulations indicated this, focusing as they did on the processes in question rather than the nature of the industry. [27, 98, 116] The Secretary of State made these Regulations to counteract the harm that could be done by the manipulation of asbestos rather than focusing on any particular setting where this might happen [96, 117]. The mixing of asbestos during lagging work at the power station fell within the meaning of paragraph (i) of the Preamble to the 1931 Regulations. The Secretary of State was alive to the risk posed by mixing asbestos in settings other than a narrowly defined manufacturing context [49, 124]. Lady Hale points out that this interpretation of mixing was compatible with Cherry Tree Machine Co Ltd v Dawson sub nom Jeromson v Shell Tankers (UK) Ltd [2001] EWCA Civ 101, which the Supreme Court unanimously approves in this case [100]. Lord Kerr holds that a worker in a factory or workshop where processing of asbestos took place was within the scope of the 1931 Regulations, even if not mixing asbestos himself or directly employed by the occupiers of the premises where asbestos was being mixed. The Secretary of State made these Regulations under section 79 of the Factory and Workshop Act 1901 (the 1901 Act), which empowered him to afford protection to workers not involved in the asbestos processing. The risk of injury which these Regulations sought to protect against arose from inhalation of dust or fumes. There was therefore no logical reason to exclude those who were liable to exposure despite not working directly with asbestos [53]. Lady Hale concludes that liability under the 1901 Act is imposed on occupiers (rather than employers) to protect people in the premises they occupied, therefore the question was whether a person was employed in the power station, not whether he was employed by the occupier [103 104]. Lord Clarke deems that Mr McDonald was in a real sense working for the purposes of the power station and agrees with Lord Kerr [127]. Lord Reed, with whom Lord Neuberger agrees, undertakes an extensive review of the background to the 1931 Regulations. They would dismiss the appeal on the grounds that the 1931 Regulations are not engaged as they are intended to apply solely to asbestos processing within the asbestos industry. They hold that the Regulations were penal legislation which should be construed narrowly [158]. Lord Neuberger, Lord Kerr, Lord Clarke and Lord Reed would dismiss the cross appeal. They agree that, while the rest of the statutory criteria are met, there is no sufficient evidence to rebut the Court of Appeals conclusion that Mr McDonald had failed to establish that a substantial quantity of dust had been given off by the mixing process, as required by section 47(1) of the 1937 Act [90, 209]. Lady Hale would allow the cross appeal on the grounds that there is evidence upon which it could be determined that a substantial quantity of dust had been given off [108 109].

longest

Each of the appellants has been convicted on indictment of a serious criminal offence. Each has had an appeal against conviction dismissed by the Court of Appeal. Each appeals on the ground that he did not receive a fair trial, contrary to article 6 of the European Convention on Human Rights (article 6) (The Convention). The appeal of each is based on the fact that there was placed before the jury the statement of a witness who was not called to give evidence. In each case the witness was the victim of the alleged offence. Mr Horncastle and Mr Blackmore were convicted of causing grievous bodily harm, with intent, to Mr Peter Rice. Mr Rice made a witness statement to the police about what had happened to him. He died before the trial of causes not attributable to the injuries that had been inflicted upon him. His statement was read at the trial. Although there was other evidence that supported it, the Court of Appeal concluded that the statement was to a decisive degree the basis upon which the appellants were convicted. Mr Marquis and Mr Graham were convicted of kidnapping a young woman called Hannah Miles. She made a witness statement to the police in which she described what happened to her. The day before the appellants trial she ran away because she was too frightened to give evidence. Her statement was read to the jury. A considerable body of oral evidence was also given at the trial. The Court of Appeal held that the appellants convictions did not rest on the evidence of Miss Miles to a decisive extent. The appellants challenge that finding. Mr Rices witness statement was admitted pursuant to section 116(1) and (2)(a) of the Criminal Justice Act 2003 (the CJA 2003), which makes admissible, subject to conditions, the statement of a witness who cannot give evidence because he has died. Miss Miles witness statement was admitted pursuant to section 116(1) and (2)(e) of the CJA 2003, which makes admissible, subject to conditions, the statement of a witness who is unavailable to give evidence because of fear. The principal issue raised by these appeals is whether a conviction based solely or to a decisive extent on the statement of a witness whom the defendant has had no chance of cross examining necessarily infringes the defendants right to a fair trial under articles 6(1) and 6(3)(d) which provide: (1) In the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law. (3) Everyone charged with a criminal offence has the following minimum rights: . to examine or have examined witnesses (d) against him and to obtain the attendance and examination of witnesses on his behalf under the same conditions as witnesses against him. The appellants submit that an affirmative answer must be given to this principal issue. In each case it is submitted that the trial judge should have refused to admit the statement on the ground that it was a decisive element in the case against the appellants. This the judge could have done, either by reading down the relevant provisions of the 2003 Act so as to preclude the admission of hearsay evidence in such circumstances or by excluding it under section 78 of the Police and Criminal Evidence Act 1984 (PACE). In so submitting the appellants rely on a line of Strasbourg cases, culminating in the decision of the Fourth Section of the European Court of Human Rights (the Chamber), delivered on 20 January 2009, in the cases of Al Khawaja and Tahery v United Kingdom (2009) 49 EHRR 1. In each of those applications statements had been admitted in evidence at a criminal trial of a witness who was not called to give evidence. The Strasbourg Court held that, in each case, the statement was the sole or, at least, the decisive basis for the applicants conviction. The Court reviewed its own jurisprudence and concluded that this established that the rights of each applicant under articles 6(1) and 6(3)(d) had not been respected. The Court took as its starting point the following statement in Luc v Italy (2001) 36 EHRR 807 at paragraph 40: where a conviction is based solely or to a decisive degree on depositions that have been made by a person whom the accused has had no opportunity to examine or to have examined, whether during the investigation or at the trial, the rights of the defence are restricted to an extent that is incompatible with the guarantees provided by article 6. I shall call the test of fairness that this statement appears to require the sole or decisive rule. The Court of Appeal did not accept that the decision in Al Khawaja was determinative of the results of these appeals. It held that, in the circumstances of each of the appeals, the appellants had received a fair trial and dismissed the appeals. The approach to this appeal Article 43(1) of the Convention provides that within a period of three months from the date of judgment of the Chamber any party may, in an exceptional case, request that the case be referred to the Grand Chamber. Article 43(2) provides that a Panel of 5 judges of the Grand Chamber shall accept the request if the case raises a serious question affecting the interpretation or application of the Convention or its Protocols, or a serious issue of general importance. On 16 April 2009 the United Kingdom requested that the decision of the Chamber in Al Khawaja be referred to the Grand Chamber. On 5 June 2009 the Panel of the Grand Chamber adjourned consideration of that request pending our judgment in the present case. Mr Tim Owen QC, for Mr Horncastle and Mr Blackmore, submitted that we should treat the judgment of the Chamber in Al Khawaja as determinative of the success of these appeals. He submitted that this was the appropriate response to the requirement of section 2(1) of the Human Rights Act 1998 that requires a court to take into account any judgment of the European Court of Human Rights in determining any question to which such judgment is relevant. He submitted that the decision of the House of Lords in Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28; [2009] 3 WLR 74 exemplified the correct approach to a decision of the European Court. In that case the Committee held itself bound to apply a clear statement of principle by the Grand Chamber in respect of the precise issue that was before the Committee. Mr Owen submitted that we should adopt precisely the same approach to the decision of the Chamber in Al Khawaja. I do not accept that submission. The requirement to take into account the Strasbourg jurisprudence will normally result in this Court applying principles that are clearly established by the Strasbourg Court. There will, however, be rare occasions where this court has concerns as to whether a decision of the Strasbourg Court sufficiently appreciates or accommodates particular aspects of our domestic process. In such circumstances it is open to this court to decline to follow the Strasbourg decision, giving reasons for adopting this course. This is likely to give the Strasbourg Court the opportunity to reconsider the particular aspect of the decision that is in issue, so that there takes place what may prove to be a valuable dialogue between this court and the Strasbourg Court. This is such a case. The decision of the Court of Appeal In recognition of the importance of these appeals for English criminal procedure the Criminal Division of the Court of Appeal sat five strong in a composition that included the Vice President and other senior judges with extensive experience of the criminal process. The court was thus particularly well qualified to consider the questions at the heart of these appeals. These questions are: (i) whether the regime enacted by Parliament in relation to the admission of the evidence of an absent witness at a criminal trial will result in an unfair trial and, if not, (2) whether the Strasbourg jurisprudence none the less requires the court to apply that regime in a manner contrary to the intention of Parliament. The Court of Appeal carried out an extensive survey of both domestic and Strasbourg jurisprudence. They concluded that the statutory regime produced a fair trial and that the Strasbourg jurisprudence did not require the court to apply that regime in a manner contrary to Parliaments intention. I endorse those conclusions and almost all the reasoning that led to them. I commend the Court of Appeals judgment and shall, in places, borrow from it. This judgment should be read as complementary to that of the Court of Appeal, not as a substitute for it. A summary of my conclusions The following are the conclusions that I have reached for reasons that I shall develop: (1) Long before 1953 when the Convention came into force the common law had, by the hearsay rule, addressed that aspect of a fair trial that article 6(3)(d) was designed to ensure. (2) Parliament has since enacted exceptions to the hearsay rule that are required in the interests of justice. Those exceptions are not subject to the sole or decisive rule. The regime enacted by Parliament contains safeguards that render the sole or decisive rule unnecessary. The continental procedure had not addressed that aspect of a fair trial (3) that article 6(3)(d) was designed to ensure. The Strasbourg Court has recognised that exceptions to article 6(3)(d) (4) are required in the interests of justice. The manner in which the Strasbourg Court has approved those (5) exceptions has resulted in a jurisprudence that lacks clarity. The sole or decisive rule has been introduced into the Strasbourg (6) jurisprudence without discussion of the principle underlying it or full consideration of whether there was justification for imposing the rule as an overriding principle applicable equally to the continental and common law jurisdictions. (7) Although English law does not include the sole or decisive rule it would, in almost all cases, have reached the same result in those cases where the Strasbourg Court has invoked the rule. (8) The sole or decisive rule would create severe practical difficulties if applied to English criminal procedure. Al Khawaja does not establish that it is necessary to apply the sole or (9) decisive rule in this jurisdiction. The common law approach to a fair trial The United Kingdom was the first country to ratify the Convention in 1951 and the Convention came into force in 1953. Since then the Strasbourg Court has repeatedly had to grapple in judgments relating to article 6 with the requirements of a fair trial. During the same period England and Wales and the Commonwealth countries that apply the common law have been involved in the same exercise, largely by means of legislation, as have the civil law jurisdictions which, in 1953, had a very different approach to the criminal process. The English criminal process is adversarial. Its focal point is the trial, which is the judicial part of the process. The investigation into a crime is carried out by the executive, in the form of the police. The police under the supervision of the independent Crown Prosecution Service, which is responsible for ensuring the fairness, impartiality and integrity of the process, charge the defendant with the offence, prepare the case against him and seek to prove it at the trial. Rules have been laid down to protect the defendant against unfair treatment during the investigation and preparation for trial. These include the caution and the right of silence, the entitlement to legal representation, rules governing questioning by the police, an embargo on questioning a defendant after he has been charged and an entitlement to know the case against him. Two underlying themes have marked the common law approach to a fair criminal trial. The first has been that the determination of guilt or innocence should be entrusted to a lay tribunal the jury in the case of the more serious offences and the magistrates in most cases of less serious offences. The second has been a reluctance to trust the lay tribunal to attach the appropriate weight to the evidence placed before them. These themes have been reflected in the rules governing the trial process. There are two principal objectives of a fair criminal trial. The first is that a defendant who is innocent should be acquitted. The second is that a defendant who is guilty should be convicted. The first objective is in the interests of the individual; the second is in the interests of the victim in particular and society in general. The two objectives are sometimes in tension and, where they are, the first carries more weight than the second. English law has different kinds of rules that are designed to ensure a fair trial. Some relate to the procedure itself, such as the right of the defendant to be informed of the case against him, to be given any information available to the prosecution that is relevant to that case, to have legal assistance, to decline to answer questions, to be exempt from further questioning once charged with a crime, to be tried in public at a single continuous trial at which all the evidence has to be adduced, to be present at that trial to confront and cross examine the witnesses who are called to give evidence, and to be informed of the identity of those witnesses. Other rules relate to the evidence that can be placed before the tribunal, be it magistrates or a jury, which is to rule on the defendants guilt. These are rules of admissibility. Jury trials are presided over by a judge who acts as gatekeeper as to what is and what is not permitted to be placed before the jury as evidence. This is an important safeguard for the defendant. The basic principle is that only the best evidence is placed before the jury, that is, the evidence that is most likely to be reliable. In 1953 this principle rendered inadmissible almost all hearsay evidence. Hearsay evidence is any statement of fact other than one made, of his own knowledge, by a witness in the course of oral testimony. Hearsay evidence was inadmissible even if it was a past statement made by someone who was called to give oral evidence and who could be cross examined about it. Furthermore, hearsay evidence was inadmissible, whether it assisted the prosecution or the defence. There were two principal reasons for excluding hearsay evidence. The first was that it was potentially unreliable. It might even be fabricated by the witness giving evidence of what he alleged he had been told by another. Quite apart from this, the weight to be given to such evidence was less easy to appraise than that of evidence delivered by a witness face to face with the defendant and subject to testing by cross examination. The admissibility of some categories of evidence was excluded because, although the evidence was probative, it was thought that the jury could not be trusted not to give the evidence more weight than it deserved. Its probative value was outweighed by its potentially prejudicial effect. Such evidence included evidence of a defendants previous bad character or criminal record and psychiatric evidence that suggested that the defendant might have a propensity to commit an offence of the type charged. Rules governing the admissibility of evidence are important aspects of both criminal and civil procedure. They have generated lengthy text books on the law of evidence. [I am not aware that the civil law systems have a comparable body of jurisprudence]. A third category of rules related to the reasoning permissible in arriving at a conclusion of guilt. Of these the most fundamental were, and are, first that a defendant is deemed to be innocent until proved to be guilty. The jury cannot convict simply upon suspicion of guilt. More fundamentally, a jury cannot convict even if they consider it more likely than not that the defendant is guilty. They can only convict if they are sure, or satisfied beyond reasonable doubt that the defendant is guilty. But there were many more directions that a judge was required to give to a jury in relation to the process of reasoning that was permitted, or not permitted, in reaching their verdict. These sometimes required the jury to disregard evidence that was probative of guilt in order to guard against the risk that the jury would attach too much weight to such evidence. Thus the trial judge had to tell the jury that no adverse inference could be drawn from the fact that a defendant had elected not to go into the witness box and, in the exceptional case where the jury learnt that a defendant was a man of bad character, they had to be instructed that this made it no more likely that he was guilty of the crime charged. There were some circumstances in which common law or statute required the jury to be told either that they could not convict on the evidence of one witness alone unless this was corroborated, or that it would be dangerous for them to do so. This again reflected the perceived danger that a jury would give too much weight to certain categories of evidence. While some of these rules were designed to guard against the risk of an innocent man being convicted, others also met the requirement of fairness that called for equality of arms in a procedure that was adversarial. Exceptions to the rules Over the past half century it was recognised that the application, without exception, of some of these rules placed an obstacle in arriving at the truth that could not be justified. Witness statements were prepared close to the time of the crime that contained detail that the witness might not remember when called to give evidence months later. In such cases the hearsay rule might be evaded by permitting the witness to refresh his memory from the statement. Sometimes the rule operated in a way that was prejudicial to the defendant. Thus the fact that another man had confessed to the crime of which the defendant was charged was inadmissible. In other circumstances the rule excluded evidence that was plainly more reliable than the oral testimony of the witness. While the best evidence rule might justify the hearsay rule in relation to a witness who was available to give evidence, if, for some reason such as death or illness, the witness was not able to give oral evidence, a statement made by that witness might be the best evidence available of what had occurred. Sometimes the application of the rules resulted in the acquittal of defendants who were manifestly guilty see Myers v Director of Public Prosecutions [1965] AC 1001. Over the years a host of exceptions were created by the judges or by statute to these rules, and particularly to the hearsay rule, aimed at addressing these problems. In relation to civil proceedings the hearsay rule was effectively abolished by the Civil Evidence Act 1968. In relation to the criminal law, less far reaching changes were made by the Criminal Evidence Act 1965 and the Police and Criminal Evidence Act 1984. But these also included the very important general safeguard in section 78(1) of the latter statute, which remains in force. This provides: In any proceedings the court may refuse to allow evidence on which the prosecution proposes to rely to be given if it appears to the court that, having regard to all the circumstances, including the circumstances in which the evidence was obtained, the admission of the evidence would have such an adverse effect on the fairness of the proceedings that the court ought not to admit it. More significant changes were made to the hearsay rule in criminal proceedings by the Criminal Justice Act 1988, but these have been replaced by provisions of the CJA 2003. These provisions largely implemented the recommendations of the Report of the Law Commission dated 4 April 1997 (Law Com No 245) on Evidence in Criminal Proceedings: Hearsay and Related Topics. In 1995 the Law Commission had published a Consultation Paper on these topics, in response to a recommendation as to the need for reform made by a Royal Commission on Criminal Justice in 1993. As the Court of Appeal observed at paragraph 10, the consultation embraced judges, practitioners, academic lawyers and other experts and the code enacted pursuant to the Report was: informed by experience accumulated over generations and represents the product of concentrated consideration by experts of how the balance should be struck between the many competing interests affected. It also represents democratically enacted legislation substantially endorsing the conclusions of the expert consideration. The relevant provisions of the CJA 2003 have been summarised by the Court of Appeal at paragraphs 11 to 16 and I shall adopt that summary, subject to a small addition. Hearsay is not made generally admissible by this statutory code. The scheme of the code is as follows: It preserves certain specified common law categories of admissible (i) evidence (ss.114(1)(b) and 118). (ii) It makes specific provision for a limited number of categories of hearsay where there is special reason to make it admissible (ss.114(1)(a) and (c), 116 117, 119 120 and 127 129). It provides for a limited residual power to admit hearsay if the interests of (iii) justice require it (s.114(1)(d) and 114(2)). (iv) It establishes special stipulations to which hearsay evidence is subject (ss.121 126). Among the provisions of Part 11, Chapter 2 of the CJA 2003 in the second group are the following: (i) by s.116(1) and (2)(a) the statement of a witness who is unavailable because he is dead is, subject to conditions, made admissible; similar provisions apply to a witness who is medically unfit, absent overseas and cannot be brought to the UK, or cannot despite all practicable efforts be found; by s.116(1) and (2)(e) the statement of a witness who is unavailable (ii) because he does not give evidence through fear is, subject to conditions, made admissible; (iii) by s.116(3) fear is to be widely construed and (for example) includes fear of the death or injury of another person or of financial loss. (This is the addition I have made to the Court of Appeals summary); (iv) by s.117 the contents of business records maintained by those who can be expected to have had personal knowledge of the matters recorded are, subject to conditions, made admissible. In relation to a witness who is unavailable because he is dead (or unavailable for medical reasons or because he is abroad or missing), the conditions for admissibility are as follows: the evidence must be such as would be admissible if the witness were (i) present to give it orally (s.116(1)(a)); and the witness must be identified to the satisfaction of the court (s.116(1)(b)). (ii) Those same conditions apply also to the case of a witness who does not give evidence through fear. In that case an important additional condition must be satisfied. The court must be persuaded to admit the evidence and it must do so only when satisfied that it ought to be admitted in the interests of justice. In deciding whether or not this is so, the court must have regard to all relevant circumstances, but in particular to: (a) the contents of the statement; (b) any risk that its admission or exclusion will result in unfairness to any party to the proceedings (and in particular to how difficult it will be to challenge the statement in the absence of the maker); (c) the possibility of alternative special measures for the protection of the witness, such as screens or video transmitted evidence. The statements of witnesses who are dead, ill, missing, or absent through fear are examples of hearsay made admissible because the evidence is otherwise unavailable. Other categories of hearsay are made admissible because, in the ordinary way, they are likely to be reliable. Business records are made admissible (by s.117 or, where a machine is involved, s.129) because, in the ordinary way, they are compiled by persons who are disinterested and, in the ordinary course of events, such statements are likely to be accurate; they are therefore admissible as evidence because prima facie they are reliable. So, to be admissible, it must be demonstrated that they are the product of information gathered by someone with personal knowledge of the matters recorded, and that anyone through whose hands they have passed has acted in the course of trade, business, profession or office (s.117(2)), and the court is not to admit them if there is doubt about their reliability (ss.117(6) and (7) and 129(1)). If the record was compiled for the purpose of the criminal proceedings, rather than simply in the usual course of business, there is an additional requirement that the source of the information be absent or will have no recollection of the material (s.117(5)): that is designed to ensure that if he can attend to give first hand evidence he does so. S.127 (preparatory work done by the assistants to experts) is a further example of hearsay evidence which is prima facie reliable and which is admissible for either party; its admission is hedged with a similar safeguard providing for non admission if the interests of justice point against it. S.128 (confessions by co accused) is another example of hearsay made admissible (at the suit of the defendant) in the interests of fairness to the accused and because a confession is prima facie, in the absence of reason to the contrary, likely to be true; the CJA 2003 preserves a balance between the competing interests of co accused by providing for exclusion unless it be shown that the confession was not obtained by oppression or anything else likely to render it unreliable. It follows that both in the case of unavailable witnesses, and in the case of apparently reliable hearsay, the CJA 2003 contains a crafted code intended to ensure that evidence is admitted only when it is fair that it should be. The CJA 2003 goes on, in the fourth group of its provisions, to lay down special stipulations applicable to all hearsay, designed to further the same end. They are as follows: (i) S.124 makes special provision for the admissibility of any material which it is contended challenges the credibility of an absent witness. The opposing party is enabled to put in evidence anything which he could have put in if the witness had been present, but he may also put in material which, if the witness had been present, could only have been asked of him in cross examination in circumstances where his answers would have been final; this puts the challenger to that extent in a better position than if the witness is present, and is designed to help to counterbalance the absence of cross examination of the witness in person. In most cases also, in addition to the statutory rules, a defendant who is faced with hearsay evidence will be entitled to ask the court to call upon the Crown to investigate the credibility of any absent witness and to disclose anything capable of challenging it. That exercise will ordinarily require the Crown to go considerably beyond what would otherwise be the duty simply to disclose what is already in its possession and capable of undermining its case; it will require active investigation of the bona fides, associates and credibility of the witness, so as to provide the defendant with, in addition to anything he already knows, everything capable of being found which can be used to test the reliability of the absentee. (ii) By s.125 the judge is required to stop any case depending wholly or partly on hearsay evidence if that evidence is unconvincing to the point where conviction would, in the judges opinion, be unsafe; this is an important exception to the usual rule of the law of England and Wales that the assessment of the weight of evidence is exclusively for the jury (see R v Galbraith (1981) 1 WLR 1039). (iii) S.126 preserves the general power of the judge (which existed at common law and is enshrined in s.78 of the Police and Criminal Evidence Act 1984) to exclude any evidence relied upon by the Crown (but not by a defendant) if its admission would have such an adverse effect on the fairness of the trial that it ought not to be admitted; the section adds a further obligation upon the judge to exclude hearsay evidence if its admission would generate satellite disputes which would cause an undue waste of time such as to outweigh the case for admitting it. It is significant, as the Court of Appeal has pointed out, that the Law Commission gave special consideration to whether there should be a requirement that hearsay should not be capable of proving an essential element of an offence unless supported by other evidence. The Commission was persuaded by the responses to consultation that this would not be desirable. It would require a complex direction to the jury of a type that had proved unsatisfactory in relation to other circumstances where the jury used to be directed to look for corroboration of evidence. The Commission concluded that the danger of a defendant being unfairly convicted on the basis of hearsay evidence alone would be met by the safeguards that it proposed, in particular that which was subsequently adopted as section 125 of the CJA 2003. The principal safeguards designed to protect a defendant against unfair prejudice as a result of the admission of hearsay evidence, seen in the context of the more general safeguards that apply to every jury trial, can be summarised as follows: i) The trial judge acts as gatekeeper and has a duty to prevent the jury from receiving evidence that will have such an adverse effect on the fairness of the proceedings that it should not be received. ii) Hearsay evidence is only admissible in strictly defined circumstances. In essence the judge has to be satisfied beyond reasonable doubt that the prosecution is not able to adduce the evidence by calling the witness. iii) Once the prosecution case is closed, the judge must withdraw the case from the jury if it is based wholly or partly on hearsay evidence and that evidence is so unconvincing that, considering its importance, the defendants conviction would be unsafe. iv) The judge has to direct the jury on the dangers of relying on hearsay evidence. The jury has to be satisfied of the defendants guilt beyond reasonable v) doubt. vi) The defendant can apply for permission to appeal against his conviction, which will be granted where reasonable grounds for appeal are demonstrated. A failure to comply with the safeguards outlined above, and in particular the admission of hearsay evidence contrary to the rules on its admissibility, will constitute such grounds. Where the Court of Appeal finds that there has been such a failure, the appeal will be allowed unless the court is satisfied that, despite the shortcoming, the conviction is safe. As the Court of Appeal observed at paragraphs 77 78, the CJA 2003 has now been in force for a number of years and it is clear that the admissibility of hearsay evidence is being cautiously approached by the courts see the passages quoted from R v Y [2008] 1 WLR 1683. Sir Robin Auld in his Review of the Criminal Courts of England and Wales (2001) into the workings of the criminal courts expressed the view, supported by a body of academic opinion, that the recommendations of the Law Commission did not go far enough. He recommended at paragraph 104 that hearsay should be generally admissible, subject to an obligation to adduce the best evidence, rather than generally inadmissible subject to specified exceptions as proposed by the Law Commission. But in the event (as indicated in para 29 above), it was upon the Law Commissions recommendations that the 2003 Act was essentially based. Hearsay exceptions in other Commonwealth Jurisdictions Other established common law jurisdictions, namely Canada, Australia and New Zealand have, by both common law and statutory development, recognised hearsay evidence as potentially admissible, under defined conditions, in circumstances where it is not possible to call the witness to give evidence, even where the evidence is critical to the prosecution case. An analysis of the position in those jurisdictions, prepared by Lord Mance, is annexed to this judgment as Annexe 1. This demonstrates that, under the common law and statutory exceptions to the hearsay rule recognised in those jurisdictions there is no rigid rule excluding evidence if it is or would be either the sole or decisive evidence, however those words may be understood or applied. Instead, the common law and legislature in these countries have, on a principled basis, carefully developed and defined conditions under which hearsay evidence may be admitted, in the interests of justice and on a basis ensuring that defendants receive a fair trial. Under the common law system of jury trial, the conditions relating to the admissibility of evidence combine, to this end, with the trial judges role as gatekeeper in applying them and his general residual discretion to exclude prejudicial or unfair evidence from going before the jury. Hearsay in the United States The position in the United States differs markedly from that in this jurisdiction and in the Commonwealth jurisdictions to which I have referred. In the United States, the Sixth Amendment to the Constitution provides that: In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favour, and to have the Assistance of Counsel for his defence. The right under the Sixth Amendment to be confronted with the witnesses against him has recently been interpreted in an absolute sense by the majority of the Supreme Court in Crawford v Washington 124 S.Ct. 1354 (2004), reversing its previous decision in Ohio v Roberts 448 U.S. 56; 100 S.Ct 2531 (1980), and in Melendez Diaz v Massachusetts 25 June 2009. The majority in the Supreme Court in reaching these decisions took an originalist approach to the Constitution, relying on its view of the common law position in the late 17th century. The result of these United States decisions is to exclude any testimonial evidence whatever in respect of which there has been or can be no cross examination. Testimonial evidence is not precisely defined in these authorities, but includes police interrogations or prior testimony at a preliminary hearing or former trial (Crawford p.1374) and, in the light of Melendez Diaz, certificates of state laboratory analysts stating that material seized by police and alleged by the prosecution to be connected to a defendant was a prohibited drug. Business records or statements in furtherance of a conspiracy were, in contrast, identified in Crawford at p.1367 as by their naturenot testimonial. Crawford also recognised one possible exception to the principle requiring confrontation in respect of testimonial evidence, that is dying declarations (footnote 6, p.1367). Article 6(3)(d) has not been interpreted by the Strasbourg Court in the same way that the US Supreme Court has now interpreted the Sixth Amendment. The Strasbourg Court has accepted that there are circumstances that justify the admission of statements of witnesses who have not been subject to confrontation with the defendant. The possibility remains, however, that by propounding the sole or decisive test the Strasbourg Court has condemned as rendering a trial unfair the admission of hearsay evidence in circumstances where the legislature and courts of this jurisdiction and of other important Commonwealth jurisdictions (Canada, Australia and New Zealand) have determined that the evidence can fairly be received. This is a startling proposition and one that calls for careful analysis of the Strasbourg jurisprudence. Special measures and anonymity I referred earlier to the recognition at common law of the defendants right to know the identity of the witnesses to be called by the prosecution. This, coupled with the right of a defendant to know the case to be advanced against him, ensured that he could make proper preparations to examine the witnesses called at his trial. The right to know the witnesses identities was thus an important element in the right of confrontation. Where a witness is not prepared through fear to be seen to give evidence against a defendant there are two ways in which his evidence may none the less be placed before the court. If he has previously made a witness statement that statement can be read as evidence. Alternatively he may be persuaded to give evidence anonymously if special measures are taken to ensure that he cannot be recognised by the defendant. Similar issues can arise in respect of each method of adducing evidence and the Strasbourg jurisprudence sometimes does not draw a distinction between the two. In Al Khawaja 49 EHRR 1 the Court held that the sole or decisive rule applied equally in the case of each. Mr Perry QC for the Crown urged that we should not consider anonymous witnesses but should confine ourselves to the circumstances of these appeals which concern the reading of statements of absent witnesses. This was the course followed by the Court of Appeal, who suggested that the Strasbourg jurisdiction dealing with anonymous witnesses did not necessarily apply to absent witnesses. There is a difference of principle between a witness who cannot be called to give evidence because, for instance, he is dead or untraceable, and a witness who is able and available to give evidence but not willing to do so. It might be argued that, where a witness is in a position to give evidence, fairness demands that his evidence should not be used if he is not prepared to face the defendant in court without anonymity. But, as I shall show, both the Strasbourg Court and the United Kingdom Parliament and, indeed, the Ministers of the Council of Europe have recognised that in some circumstances it is permissible to allow witnesses to give their evidence anonymously. So far as a sole or decisive rule is concerned, I am not persuaded that there is a difference in principle between its existence in relation to absent witnesses and its existence in relation to anonymous witnesses. Each situation results in a potential disadvantage for the defendant. The extent of that disadvantage will depend on the facts of the particular case. I cannot see why a sole or decisive test should apply in the case of anonymous evidence but not in the case of a witness statement. The critical question is whether, in either case, the demands of a fair trial require that a sole or decisive test should apply regardless of the particular circumstances and, in particular, regardless of the cogency of the evidence. Accordingly, I propose to set out the approach of English law to anonymity. Some witnesses in criminal proceedings are intimidated by giving evidence or by the prospect of so doing. This is especially true of children and those who are mentally or physically disabled, but it can also be the case of victims who fear being confronted by the defendant, particularly in cases of sexual offences. Section 16 of the Youth Justice and Criminal Evidence Act 1999 makes those who are under 17 or incapacitated eligible for special measures when giving evidence. Section 17 does the same in the case of any witness if the court is satisfied that the quality of his or her evidence is likely to be diminished by fear or distress when testifying. Special measures include giving evidence screened from the defendant or by video link. Over the last 20 years judges purported to exercise a common law power to permit witnesses to give evidence anonymously, sometimes resorting to special measures in order to conceal their identities, where this was considered necessary in the interests of justice. In some cases permission was given because of the desirability of not disclosing the identity of undercover police agents; in others because of fear on the part of the witness of retaliation by or on behalf of defendants. In R v Davis [2008] UKHL 36; [2008] AC 1128 this practice was challenged before the House of Lords. The appellant had been convicted of murdering two men by shooting them at a party. He was identified as the murderer by three witnesses who had been permitted to give evidence anonymously, from behind screens, because they had refused, out of fear, to testify should their identities be disclosed. It was submitted on behalf of the appellant that this procedure was contrary both to the common law right of a defendant to be confronted by his accusers and to article 6(3)(d) of the Convention. Both limbs of this argument were accepted unanimously by the House. Lord Bingham of Cornhill at paragraph 5 of his opinion set out the history of the long established principle of the English common law that, subject to certain exceptions and statutory qualifications, the defendant in a criminal trial should be confronted by his accusers in order that he may cross examine them and challenge their evidence. He observed at paragraph 20 that the statutory exceptions to calling a witness in the CJA 2003 did not permit the adducing of a statement by any witness whose name and identity was not disclosed to the defendant and that the safeguards provided by that Act would be denied to a defendant who did not know the identity of the witness. Their Lordships held that it was not open to a judge to depart from the common law rule by allowing a witness to remain anonymous. While there might well be a need for such a measure in order to combat the intimidation of witnesses, it was for Parliament not the courts to change the law. In the course of his concurring judgment Lord Mance carried out an analysis of the relevant Strasbourg case law. At paragraph 25 Lord Bingham adopted this analysis and summarised its effect as follows: It is that no conviction should be based solely or to a decisive extent upon the statements or testimony of anonymous witnesses. The reason is that such a conviction results from a trial which cannot be regarded as fair. This is the view traditionally taken by the common law of England. In fact, as I shall show, Lord Bingham slightly overstated Lord Mances conclusion. As a result of this decision Parliament amended the common law. The Criminal Evidence (Witness Anonymity) Act 2008 gave the court the power to make a witness anonymity order in the circumstances and subject to the conditions prescribed by the Act. Such an order enables a witness to give evidence subject to special measures designed to protect the identity of the witness being known. Section 4 sets out the conditions for making such an order: (1) This section applies where an application is made for a witness anonymity order to be made in relation to a witness in criminal proceedings. (2) The court may make such an order only if it is satisfied that Conditions A to C below are met. (3) Condition A is that the measures to be specified in the order are necessary (a) in order to protect the safety of the witness or another person or to prevent any serious damage to property, or (b) in order to prevent real harm to the public interest (whether affecting the carrying on of any activities in the public interest or the safety of a person involved in carrying on such activities, or otherwise). (4) Condition B is that, having regard to all the circumstances, the taking of those measures would be consistent with the defendant receiving a fair trial. (5) Condition C is that it is necessary to make the order in the interests of justice by reason of the fact that it appears to the court that (a) it is important that the witness should testify, and (b) the witness would not testify if the order were not made. (6) In determining whether the measures to be specified in the order are necessary for the purpose mentioned in subsection (3)(a), the court must have regard (in particular) to any reasonable fear on the part of the witness (a) that the witness or another person would suffer death or injury, or (b) that there would be serious damage to property, if the witness were to be identified. Section 5 sets out the matters to be taken into consideration when deciding whether the considerations in section 4 are satisfied: (1) When deciding whether Conditions A to C in section 4 are met in the case of an application for a witness anonymity order, the court must have regard to (a) the considerations mentioned in subsection (2) below, and (b) such other matters as the court considers relevant. (2) The considerations are (a) the general right of a defendant in criminal proceedings to know the identity of a witness in the proceedings; (b) the extent to which the credibility of the witness concerned would be a relevant factor when the weight of his or her evidence comes to be assessed; (c) whether evidence given by the witness might be the sole or decisive evidence implicating the defendant; (d) whether the witnesss evidence could be properly tested (whether on grounds of credibility or otherwise) without his or her identity being disclosed; (e) whether there is any reason to believe that the witness (i) has a tendency to be dishonest, or (ii) has any motive to be dishonest in the circumstances of the case, having regard (in particular) to any previous convictions of the witness and to any relationship between the witness and the defendant or any associates of the defendant; (f) whether it would be reasonably practicable to protect the witnesss identity by any means other than by making a witness anonymity order specifying the measures that are under consideration by the court. Thus Parliament has decreed that the question of whether evidence is or is likely to be sole or decisive is relevant to the question of whether the court should permit it to be given anonymously but there is no mandatory rule prohibiting the admission of such evidence. Criminal procedure in the civil law jurisdictions paragraphs 10 and 11 Lord Rodger stated: In R(D) v Camberwell Green Youth Court [2005] UKHL 4; [2005] 1 WLR 393 at the introduction of article 6(3)(d) will not have added anything of significance to any requirements of English law for witnesses to give their evidence in the presence of the accused. An examination of the case law of the European Court of Human Rights tends to confirm that much of the impact of article 6(3)(d) has been on the procedures of continental systems which previously allowed an accused person to be convicted on the basis of evidence from witnesses whom he had not had an opportunity to challenge. We have not been referred to the travaux preparatoires to the Convention or to the reason why paragraph (3)(d) was included in article 6. The continental systems to which Lord Rodger referred are best exemplified by the French Criminal Procedure, upon which many others were based. This, together with other continental systems has undergone marked changes over the last fifty years, and is still facing proposed radical change. The marked difference between that system and the English system in 1953 was the importance of the inquisitorial phase of the French process, which, in the case of a serious offence, was the second of the three stages of the procedure. The first stage was a police investigation, under the supervision of the public prosecutor (ministre public), that ascertained that a crime had been committed and identified a suspect. The second stage was a judicial inquiry aimed at ascertaining the facts and determining whether there was a case against the suspect fit for trial (the instruction). This stage was inquisitorial, classically conducted by a juge dinstruction, an examining judge. The third stage was the trial itself. The instruction was conducted in private episodically, often over many months, during which time the suspect might be held in detention. It included repeated interrogations of the suspect, who seldom exercised his right to remain silent. It included examination of witnesses in the absence of the suspect and his lawyer, unless the examining judge chose to arrange a confrontation with the suspect. Interrogations or examinations were not recorded verbatim, but in the form of a summary of the evidence given, dictated by the examining judge and recorded by a greffier. In this way a dossier was built up. This dossier formed the basis of the conduct of the trial by the judge presiding. The reports of the Strasbourg cases show that evidence given during the instruction by witnesses whom the defendant had had no chance to question was frequently used at the trial. There was no bar to the reception of hearsay evidence nor rules of admissibility designed to prevent the tribunal at the trial from receiving evidence on the ground that its prejudicial effect outweighed its probative value. Generally speaking the instruction was the most significant stage of the criminal process all the more so because the guilty plea procedure was unknown. In this jurisdiction a defendant may decide to plead guilty at any stage between being charged and the trial. If he takes this course there will be no trial. Well over 80% of criminal prosecutions are resolved by a plea of guilty. If a trial takes place, this is because the defendant contests his guilt. Under the civil law system there is no such procedure. Guilt must always be proved at the trial. But if the defendant has confessed his guilt in one of the earlier stages of the procedure and does not retract that confession at his trial, the trial will be very much a formality. In this jurisdiction there is no judicial investigation, in the course of which a confrontation can take place between witnesses and the suspect. The investigation into a crime is carried out by the police, who do not act as judicial officers, although they act under the supervision of the independent Crown Prosecution Service (para 16 above). If the police obtain sufficient evidence to justify a prosecution, the defendant must then be charged. Thereafter he is immune from further questioning unless and until he chooses to give evidence at his trial. The Strasbourg jurisprudence prior to Al Khawaja The wording of article 6(3)(d) suggests that it required a procedure similar to that which followed from the application in this jurisdiction of the hearsay rule. It appears to require the witness to give his or her evidence live at the trial and thus to be subject to examination by or on behalf of the defendant. Some of the early jurisprudence supports this approach. Thus the Court held that the paragraph (3)(d) rights applied at the trial and not when a witness was being questioned by the police X v Germany (1979) 17 DR 231 or by the investigating judge Ferrari Bravo v Italy (1984) 37 DR 15. But, just as in this jurisdiction it was found that, in some circumstances, justice required exceptions to the hearsay rule, the Strasbourg Court came to accept that some exceptions had to be made to the strict application of article 6(3)(d). The Strasbourg jurisprudence deals with the two situations that raise similar issues of principle: the admission of evidence of a witness who is anonymous and the admission of evidence in the form of a statement made by a witness who is not called to testify. The Strasbourg jurisprudence in relation to article 6, and article 6(3)(d) in particular, has received detailed consideration by courts in this country on a number of occasions prior to this case. The conclusions reached, prior to the decision of the Strasbourg Court in Al Khawaja, were summarised by Lord Bingham in Grant v The Queen [2006] UKPC 2; [2007] 1 AC 1 at paragraph 17 (Strasbourg references omitted): The Strasbourg court has time and again insisted that the admissibility of evidence is governed by national law and that its sole concern is to assess the overall fairness of the criminal proceedings in question . The Strasbourg court has been astute to avoid treating the specific rights set out in article 6 as laying down rules from which no derogation or deviation is possible in any circumstances. What matters is the fairness of the proceedings as a whole. the Strasbourg court has recognised the need for a fair balance between the general interest of the community and the personal rights of the individual, and has described the search for that balance as inherent in the whole ConventionThus the rights of the individual must be safeguarded, but the interests of the community and the victims of crime must also be respected. An example, not based on the present facts, illustrates the point. In Jamaica, as in England and Wales, as already noted, the statement of a witness may be adduced in evidence if he is shown to have absented himself through fear of the consequences to him if he gives evidence. In the case of a prosecution witness, such fear is likely to have been induced by or on behalf of a defendant wishing to prevent adverse evidence being given. As observed by Potter LJ in R v M (KJ) [2003] 2 Cr App R 322, para 59, echoed by Waller LJ in R v Sellick [2005] I WLR 3257, paras 36, 52 53, it would be intolerable if a defendant shown to have acted in such a way could rely on his human rights under article 6 (or section 20) to prevent the admission of hearsay evidence. Where a witness is unavailable to give evidence in person because he is dead, or too ill to attend, or abroad, or cannot be traced, the argument for admitting hearsay evidence is less irresistible, but there may still be a compelling argument for admitting it, provided always that its admission does not place the defendant at an unfair disadvantage. While, therefore, the Strasbourg jurisprudence very strongly favours the calling of live witnesses, available for cross examination by the defence, the focus of its inquiry in any given case is not on whether there has been a deviation from the strict letter of article 6(3) but on whether any deviation there may have been has operated unfairly to the defendant in the context of the proceedings as a whole. This calls for consideration of the extent to which the legitimate interests of the defendant have been safeguarded. This is, I believe, a fair and accurate summary of a difficult area of Strasbourg jurisprudence. Article 6(3)(d) is concerned with the fairness of the trial procedure. It recognises that a fair procedure should entitle the defendant to have examined the witnesses against him and to obtain the attendance and examination of witnesses on his behalf. What the article does not deal with is the procedure that is appropriate where it is simply not possible to comply with article 6(3)(d); where, for instance, after making a statement, the witness for the prosecution or defence has died. Fairness does not require that in such circumstances the evidence of the witness should not be admitted at the trial. On the contrary it may well require that it should be admitted. The Strasbourg Court has recognised this. As the Court of Appeal in the present case pointed out in paragraph 37 of its judgment examples of the admission of statements in such circumstances include death: Ferrantelli and Santangelo v Italy (1996) 23 EHRR 288; illness: Trivedi v United Kingdom (1997) 89 A DR 136 and impossibility of tracing the witness: Artner v Austria (Application No 13161/87), 25 June 1992. Thus where a statement has been read of an absent witness, or evidence has been given anonymously, the Strasbourg Court first considers whether there was justification for this course. When considering justification the Strasbourg Court properly has regard to the human rights of witnesses and victims. In Doorson v The Netherlands (1996) 22 EHRR 330 the Court observed: It is true that article 6 does not explicitly require the interests of witnesses in general, and those of victims called upon to testify in particular, to be taken into consideration. However, their life, liberty or security of person may be at stake, as may interests coming generally within the ambit of article 8 of the Convention. Such interests of witnesses and victims are in principle protected by other, substantive provisions of the Convention, which imply that Contracting States should organise their criminal proceedings in such a way that those interests are not unjustifiably imperilled. Against this background, principles of fair trial also require that in appropriate cases the interests of the defence are balanced against those of witnesses or victims called upon to testify. One situation where Strasbourg has recognised that there is justification for not calling a witness to give evidence at the trial, or for permitting the witness to give that evidence anonymously, is where the witness is so frightened of the personal consequences if he gives evidence under his own name that he is not prepared to do so. If the defendant is responsible for the fear, then fairness demands that he should not profit from its consequences. Even if he is not, the reality may be that the prosecution are simply not in a position to prevail on the witness to give evidence. In such circumstances, having due regard for the human rights of the witness or the victim, as well as those of the defendant, fairness may well justify reading the statement of the witness or permitting him to testify anonymously. Claims of justification on such grounds have to be rigorously examined see Doorson v The Netherlands (1996) 22 EHRR 330 at paragraph 71, Kok v The Netherlands (Application No 43149/98), Reports of Judgments and Decisions 2000 VI, p 597; Visser v The Netherlands (Application No 26668/95), 14 February 2002 at paragraph 47; Krasniki v Czech Republic (Application No 51277/99), 28 February 2006 at paragraphs 80 81; Luc v Italy (2001) 36 EHRR 807 at paragraph 40: As the Court has stated on a number of occasions, it may prove necessary in certain circumstances to refer to depositions made during the investigative stage (in particular, where a witness refuses to repeat his deposition in public owing to fears for his safety, a not infrequent occurrence in trials concerning Mafia type organisations). Where the court has found justification for the admission of a statement from a witness not called, or for a witness giving evidence anonymously, the Court has been concerned with whether the process as a whole has been such as to involve the danger of a miscarriage of justice. The exercise has been similar to that conducted by the English Court of Appeal when considering whether, notwithstanding the breach of a rule relating to admissibility, the conviction is safe. There is, of course, an overlap between considering whether procedure has been fair and whether a verdict is safe, and it is sometimes difficult to distinguish between the two questions. Doorson v The Netherlands is a particularly informative example of the approach of the Strasbourg Court to a situation where there was justification both for admitting the statement of a witness who was not called to give evidence and for hearing the evidence of two anonymous witnesses whose evidence was not given in the presence of the defendant. The applicant was convicted of drug trafficking. The justification for admitting the statement of the witness who was not called was that he had absconded and it was thus impossible to call him to give evidence. The justification for permitting the two witnesses to give evidence anonymously and without the defendant being present was that it was reasonable for them to fear reprisals from the applicant if he discovered that they had given evidence against him, albeit that there was no evidence that they had ever been threatened by the applicant. Both the opinion of the Commission and the judgment of the Court suggest that the primary concern of each when considering whether the admission of the evidence had rendered the trial unfair was whether the evidence was reliable. So far as the witness who had absconded was concerned, the Commission held that it could not be regarded as unfair if the courts took into account the statement that he had made to the police (paragraph 78). The Court held that it had been permissible for the court to have regard to the statement especially since it could consider that statement to be corroborated by other evidence before it (paragraph 80). So far as the anonymous witnesses were concerned, the Court of Appeal had ordered them to be examined by an investigating judge in the presence of the defendants counsel, though not of the defendant. She knew the identity of the witnesses. She reported that she had the impression that both witnesses knew whom they were talking about and that her impression had been that the witnesses themselves believed their statements to be true (paragraph 32). The Court concluded that: in the circumstances the counterbalancing procedure followed by the judicial authorities in obtaining the evidence of witnesses Y15 and Y16 must be considered sufficient to have enabled the defence to challenge the evidence of the anonymous witnesses and attempt to cast doubt on the reliability of their statements, which it did in open court by, amongst other things, drawing attention to the fact that both were drug addicts. Although, as I have shown, the Strasbourg Court has accepted that in exceptional cases failure to comply with the strict requirements of article 6(3)(d) will not invalidate the fairness of the trial, the Court has not acknowledged this in terms. The Court might have said, in terms, that paragraph (3)(d) has no application where it is impossible to call a witness at the trial, but it did not. The Court might have said, in terms, that in exceptional circumstances a failure to comply with paragraph (3)(d) will not render the trial unfair, but it did not. Rather the Court has used language that has tended to obscure the fact that it is, in reality and in special circumstances, countenancing a failure to comply with the requirements of paragraph (3)(d). I shall take Kostovski v The Netherlands (1989) 12 EHRR 434 as an example of the language used. The phraseology is almost standard form in cases dealing with article 6(3)(d). The recital of the relevant legal principles begins with this statement: It has to be recalled at the outset that the admissibility of evidence is primarily a matter for regulation by national law. Again, as a general rule it is for the national courts to assess the evidence before them. In the light of these principles the Court sees its task in the present case as being not to express a view as to whether the statements in question were correctly admitted and assessed but rather to ascertain whether the proceedings considered as a whole, including the way in which evidence was taken, were fair. This being the basic issue, and also because the guarantees in article 6(3) are specific aspects of the right to a fair trial set forth in paragraph (1), the Court will consider the applicants complaints from the angle of paragraphs (3)(d) and (1) taken together. This passage indicates that the fairness of a trial has to be assessed on a case by case basis, viewing each trial as a whole, and that an inability on the part of a defendant to cross examine the maker of a statement that is admitted in evidence will not necessarily render the trial unfair. The Court in Kostovski went on to say this: In principle, all the evidence must be produced in the presence of the accused at a public hearing with a view to adversarial argument. This does not mean, however, that in order to be used as evidence statements of witnesses should always be made at a public hearing in court: to use as evidence such statements obtained at the pre trial stage is not in itself inconsistent with paragraphs (3)(d) and (1) of article 6, provided the rights of the defence have been respected. As a rule, these rights require that an accused should be given an adequate and proper opportunity to challenge and question a witness against him, either at the time the witness was making his statement or at some later stage of the proceedings. There are two points to make in respect of this passage. The first is that the phrases in principle and as a rule reflect the fact that the Strasbourg Court has recognised that the requirements of article 6(3)(d) are not absolute or inflexible. The second point is that the proposition that an accused should be given an adequate and proper opportunity to challenge and question a witness against him, either at the time the witness was making his statement or at some later stage of the proceedings (emphasis mine) reflects Strasbourg jurisprudence which appears to dilute the protection that article 6(3)(d) would otherwise supply. One of the objects of the right of a defendant to cross examine witnesses is to give the trial court the chance of observing their demeanour under questioning and thus forming its own impression of their reliability see Kostovski at paragraph 43. The aim is adversarial argument at a public hearing see Kostovski at paragraph 41. These objects will not be achieved by granting the defendant or his lawyers an opportunity to confront or question witnesses in the course of the inquisitorial investigation by the investigating judge. The words that I have emphasised, repeated again and again in the Strasbourg jurisprudence, appear to suggest that a right to challenge a witness at the investigatory stage of the criminal process will be enough to satisfy article 6(3)(d). This exemplifies the danger that repeated repetition of a principle may lead to its being applied automatically without consideration of whether, having regard to the particular facts of the case, its application is appropriate. The true position is, I suggest, that where possible the defendant should be entitled to examine witnesses at the trial but that, where this proves impossible, the fact that the defendant had a right to challenge the witness at the investigatory stage is a relevant factor when considering whether it is fair to rely on the witness deposition as evidence at the trial see, for instance, Luc v Italy (2001) 36 EHRR 807. The sole or decisive rule The sole or decisive rule entered the Strasbourg jurisprudence in Doorson v The Netherlands where, having found justification for admitting the statement of an absent witness and for the anonymity of two witnesses, the Court added: Finally, it should be recalled that, even when counterbalancing procedures are found to compensate sufficiently the handicaps under which the defence labours, a conviction should not be based either solely or to a decisive extent on anonymous statements. The seeds of the sole or decisive rule would seem to be found in a series of earlier cases, details of which are set out in Annexe 2 to this judgment. In most of these cases there had been a failure to comply with the requirements of article 6(3)(d) for which there was no justification. The Court none the less considered it relevant to consider the impact of the evidence in question on the applicants conviction when deciding whether this had rendered the trial unfair in violation of article 6(1). The inference was that if the evidence had not had a significant effect on the outcome of the trial, there would be no violation of article 6(1). The sole or decisive test propounded in Doorson went a significant step further. It stated that, even where there was justification for not calling a witness, basing a conviction solely or decisively on the evidence of that witness would be unfair. In 1997 the Committee of Ministers of the Council of Europe published Recommendation No R (97) 13 concerning Intimidation of Witnesses and the Rights of the Defence. This included measures to be taken in relation to organised crime. The measures dealt with different methods of protecting witnesses from the risk of reprisals, or accommodating their fear of such reprisals. These included admitting evidence of pre trial statements made before a judicial authority and preserving the anonymity of witnesses. In relation to anonymity, the Ministers recommended When anonymity has been granted the conviction shall not be based solely or to a decisive extent on the evidence of such persons. The recommendation would seem to have been derived from the Strasbourg jurisprudence, for the preamble to the Recommendation recites: Bearing in mind the provisions of the European Convention on Human Rights and the case law of its organs, which recognise the rights of the defence to examine the witness and to challenge his/her testimony but do not provide for a face to face confrontation between the witness and the alleged offender; In his review of the Strasbourg jurisprudence in Grant v The Queen Lord Bingham did not address the question of whether the admission of hearsay evidence was subject to the sole or decisive test. That question was considered by the Court of Appeal in R v Sellick [2005] EWCA Crim 651; [2005] 1 WLR 3257. In that case the trial judge had permitted the statements of witnesses to be read pursuant to sections 23 and 26 of the 1988 Act on the ground that they had not given evidence through fear. Waller LJ reviewed the Strasbourg authorities and summarised the position as follows: 50. What appears from the above authorities are the following propositions. (i) The admissibility of evidence is primarily for the national law. (ii) Evidence must normally be produced at a public hearing and as a general rule article 6(1) and (3)(d) of the Convention require a defendant to be given a proper and adequate opportunity to challenge and question witnesses. (iii) It is not necessarily incompatible with article 6(1) and (3)(d) of the Convention for depositions to be read and that can be so even if there has been no opportunity to question the witness at any stage of the proceedings. Article 6(3)(d) is simply an illustration of matters to be taken into account in considering whether a fair trial has been held. The reasons for the court holding it necessary that statements should be read and the procedures to counterbalance any handicap to the defence will all be relevant to the issue, whether, where statements have been read, the trial was fair. (iv) The quality of the evidence and its inherent reliability, plus the degree of caution exercised in relation to reliance on it, will also be relevant to the question whether the trial was fair. 51. The question is whether there is a fifth proposition to the effect that where the circumstances would otherwise justify the reading of the statement where the defendant has had no opportunity to question the witness at any stage of the trial process, the statement must not be allowed to be read if it is the sole or decisive evidence against the defendant. Certainly at first sight para 40 of Luc v Italy 36 EHRR 807 seems to suggest that in whatever circumstances and whatever counterbalancing factors are present if statements are read then there will be a breach of article 6 of the Convention, if the statements are the sole or decisive evidence. Furthermore there is some support for that position in the previous authorities. But neither Luc v Italy nor any of the other authorities were concerned with a case where a witness, whose identity was well known to a defendant, was being kept away by fear, although we must accept that the reference to Mafia type organisations and the trials thereof in para 40 of Luc v Italy shows that the court had extreme circumstances in mind. 52. The question we have posed to ourselves is as follows. If the European court were faced with the case of an identified witness, well known to a defendant, who was the sole witness of a murder, where the national court could be sure that that witness had been kept away by the defendant, or by persons acting for him, is it conceivable that it would hold that there were no counterbalancing measures the court could take which would allow that statement to be read. If care had been taken to see that the quality of the evidence was compelling, if firm steps were taken to draw the jurys attention to aspects of that witnesss credibility and if a clear direction was given to the jury to exercise caution, we cannot think that the European court would nevertheless hold that a defendants article 6 rights had been infringed. In such a case, as it seems to us, it is the defendant who has denied himself the opportunity of examining the witnesses, so that he could not complain of an infringement of article 6(3)(d), and the precautions would ensure compliance and fairness in compliance with article 6(1). We for our part see no difficulty in such a clear case. 53. More difficulty arises in cases where it is not quite so clear cut, but the court believes, to a high degree of probability, that identified witnesses are being intimidated for and on behalf of the defence, and where the court is sure to the criminal standard of proof that witnesses cannot be traced and brought before the court (Butterfield Js state of mind on Lee in the instant case). In our view, having regard to the rights of victims, their families, the safety of the public in general, it still cannot be right for there to be some absolute rule that, where compelling evidence is the sole or decisive evidence, an admission in evidence of a statement must then automatically lead to a defendants article 6 rights being infringed. That would lead to a situation in which the more successful the intimidation of the witnesses, the stronger the argument becomes that the statements cannot be read. If the decisive witnesses can be got at the case must collapse. The more subtle and less easily established intimidation provides defendants with the opportunity of excluding the most material evidence against them. Such an absolute rule cannot have been intended by the European court in Strasbourg. In R v Davis Lord Mance analysed the Strasbourg jurisprudence in relation to anonymous witnesses and summarised his conclusions as follows: 89. In his submissions for the Crown Mr Perry suggested that any requirement that anonymous evidence should not be the sole or decisive basis for conviction derived from the authorities on pretrial statements by (identified) witnesses who were not called for cross examination at trial. That submission derives possible support from the citation in Kok, Visser and Krasniki of authorities which deal with that subject matter, rather than with anonymous witnesses. But it does not mean that a similar principle is inappropriate in relation to anonymous witnesses who are available for such cross examination as is possible at trial. Whatever its origin, the requirement has been deployed without drawing this distinction, which is probably less real in those civil law countries with procedures involving use of an investigating magistrate than it is in the United Kingdom. Further, in Krasniki the requirement was applied to one anonymous witness who was called at trial. It is considerably less certain, for the reasons I have mentioned in paras 84 86 above, that there is an absolute requirement that anonymous testimony should not be the sole or decisive evidence, or whether the extent to which such testimony is decisive may be no more than a very important factor to balance in the scales. I doubt whether the Strasbourg court has said the last word about this. The Court in Doorson v The Netherlands gave no explanation for the sole or decisive rule. It was not a rule that was relevant on the facts of that case, so an English jurist might suggest that it was mere obiter dicta which need not be afforded much weight. But the rule was propounded repeatedly in subsequent cases, and it is necessary to consider these in order to attempt to deduce the principle underlying the rule. I have set out a brief analysis of a number of the decisions in an attempt to identify the governing principle. This forms Annexe 3 to this judgment. It is clear from these cases that a failure to comply with article 6(3)(d), even if there is no justification for this, does not automatically result in a violation of article 6(1). It is necessary to consider whether the failure has affected the result. If it has not, no question of a violation of article 6(1) arises see X v United Kingdom (1992) 15 EHRR CD 113; Craxi v Italy (Application No 34896197), 5 December 2002. Where there has been a failure to comply with article 6(3)(d) for which there is no justification, the Court has found a violation of article 6(1) where the evidence may have contributed to the applicants conviction Ldi v Switzerland (1992) 15 EHRR 173; Taxquet v Belgium (Application No 926105), 13 January 2009. In the majority of cases there has been a failure to comply with article 6(3)(d) which has not been justified and the evidence in question has been the sole or decisive basis of the applicants conviction. A violation of article 6(1) has naturally been found in such cases. Where there is justification for a failure to comply with the requirements of article 6(3)(d) because, for instance, it is impossible in fact or law to procure the presence of the witness for cross examination, the Court has been concerned with the reliability of the evidence in question. In two cases which preceded Doorson, no violation of article 6(1) was found where the evidence in question was the principal evidence, but where it was supported by other evidence: Asch v Austria (Application No 12398/86), 29 April 1991 and Artner v Austria (Application No 13161/87), 25 June 1992. Ferrantelli and Santangelo v Italy 23 EHRR 288 was a case decided soon after Doorson. The sole or decisive test was not mentioned. The applicants were convicted of being party to the murder of two police officers committed by V. The principal evidence against them consisted of statements made by V. There was no confrontation between V and the applicants. V committed suicide before the trial. In these circumstances there was justification for reading his statements. The Court found that the applicants had had a fair trial and that there had been no violation of articles 6(1) and article 6(3)(d). In so finding it had regard to the fact that the trial court had conducted detailed analysis of the statements and found them to be corroborated. In Doorson itself, which was primarily an anonymity case, the Court found that it had been acceptable to have regard to a statement of a witness whose attendance could not be procured especially since it could consider that statement to be corroborated by other evidence before it. No explanation was given in Doorson in respect of the principle underlying the sole or decisive test first propounded by the Court in that case, and, so far as I am aware, the Strasbourg Court has not subsequently explained why a conviction based in part on the evidence of a witness who was not called, or who was anonymous, need not offend article 6(1) and (3)(d), while, on the contrary, if the evidence is sole or decisive the article will be violated. I have concluded, however, that the Strasbourg Court has drawn the distinction on the premise that a conviction based solely or decisively upon the evidence of a witness whose identity has not been disclosed, or who has not been subjected to cross examination, or both, will not be safe. I have reached this conclusion for a number of reasons. First because there is nothing intrinsically objectionable or unfair in having regard to the statement of a witness where it is simply not possible to call that witness to give the evidence in question. Secondly because of the general emphasis that the Strasbourg Court understandably places on the reliability of evidence. Thirdly because the approach evidenced by the passage quoted from Kok in Annexe 3 seems to treat reliability as being the relevant factor and finally because I have not been able to identify any convincing alternative rationale for the sole or decisive test. Practicality One of the reasons why the Court of Appeal was not prepared to accept that the sole or decisive rule applied to English criminal law was the fact that the application of that rule would give rise to severe practical difficulties under our system. Two questions arise in relation to practicability. (1) How easy is it for the trial court itself to apply the sole or decisive test? (2) How easy is it for an appeal court, or for the Strasbourg Court, to determine whether the test has been properly applied? The Strasbourg Court has repeatedly emphasised that it is not its task to rule on admissibility but to consider whether the trial as a whole has been fair. When considering articles 6(1) and 6(3)(d) Strasbourg is concerned not with whether a statement ought to have been admitted in evidence by the trial court but with the use the trial court has made of the evidence. The sole or decisive test permits a court to take the evidence into account but not to base a conviction solely or decisively upon it. In a dissenting opinion in Van Mechelen v The Netherlands (1997) 25 EHRR 647 Judge van Dijk expressed the view that the sole or decisive test is difficult to apply, because if the testimony of anonymous witnesses is used by the court as part of the evidence, that will always be because the court considers it a decisive part of that evidence. This comment raises the question of what is meant by decisive. Under English procedure no evidence should be admitted unless it is potentially probative. In theory any item of probative evidence may make all the difference between conviction and acquittal. It may be the vital piece of evidence which tilts the scales enough to satisfy the tribunal beyond reasonable doubt that the defendant is guilty. Is such a piece of evidence to be treated as decisive? In Al Khawaja at paragraph 39 the Court relied, as indicating that a statement was decisive, on the statement of the Court of Appeal in Tahery that it was both important and probative of a major issue in the case. Had it not been admitted the prospect of a conviction would have receded and that of an acquittal advanced. Whatever be the precise definition of decisive, the duty not to treat a particular piece of evidence as decisive is hard enough for a professional judge to discharge. In theory he can direct himself that he must not convict if the relevant statement is decisive, and state in a reasoned judgment that he has complied with that direction. In practice such a course will often not be easy. As for the Court of Appeal or the Strasbourg Court, it will often be impossible to decide whether a particular statement was the sole or decisive basis of a conviction. In the case of a jury trial, a direction to the jury that they can have regard to a witness statement as supporting evidence but not as decisive evidence would involve them in mental gymnastics that few would be equipped to perform. If the sole or decisive test is to be applied in the context of a jury trial, the only practical way to apply it will be a rule of admissibility. The judge will have to rule inadmissible any witness statement capable of proving decisive. This will be no easy task see the judgment of the Court of Appeal at paragraphs 68 to 70. If decisive means capable of making the difference between a finding of guilt and innocence, then all hearsay evidence will have to be excluded. In Trechsels lengthy analysis of this area of the law in Human Rights in Criminal Proceedings the author advances precisely this proposition at p 298. Discussion The sole or decisive test produces a paradox. It permits the court to have regard to evidence if the support that it gives to the prosecution case is peripheral, but not where it is decisive. The more cogent the evidence the less it can be relied upon. There will be many cases where the statement of a witness who cannot be called to testify will not be safe or satisfactory as the basis for a conviction. There will, however, be some cases where the evidence in question is demonstrably reliable. The Court of Appeal has given a number of examples. I will just give one, which is a variant of one of theirs. A visitor to London witnesses a hit and run road accident in which a cyclist is killed. He memorises the number of the car, and makes a statement to the police in which he includes not merely the number, but the make and colour of the car and the fact that the driver was a man with a beard. He then returns to his own country, where he is himself killed in a road accident. The police find that the car with the registration number that he provided is the make and colour that he reported and that it is owned by a man with a beard. The owner declines to answer questions as to his whereabouts at the time of the accident. It seems hard to justify a rule that would preclude the conviction of the owner of the car on the basis of the statement of the deceased witness, yet that is the effect of the sole or decisive test. As I have suggested earlier, the justification for the sole or decisive test would appear to be that the risk of an unsafe conviction based solely or decisively on anonymous or hearsay evidence is so great that such a conviction can never be permitted. Parliament has concluded that there are alternative ways of protecting against that risk that are less draconian, as set out in the 1988 and 2003 Acts (and now, with regard to anonymous witnesses, the 2008 Act). When the Strasbourg decisions are analysed it is apparent that these alternative safeguards would have precluded convictions in most of the cases where a violation of article 6(1) and (3)(d) was found. In particular the legislation does not permit the admission of the statement of a witness who is neither present nor identified. Where the witness is unavailable but identified, or present but anonymous, the respective Acts provide the safeguards to which I have referred earlier against the risk that the use of the witness evidence will render the verdict unsafe and the trial unfair. Lord Judge has subjected many of the Strasbourg decisions to which I have referred, together with a number of others, to a detailed analysis. He has, for the most part chosen cases in which the Strasbourg Court held that article 6(1) taken together with article 6(3)(d) had been violated. Under our domestic principles of admissibility in almost all of these cases the relevant evidence would have been ruled inadmissible and the defendant would not have been convicted. The cases suggest that in general our rules of admissibility provide the defendant with at least equal protection to that provided under the continental system. Lord Judges analysis is annexed to this judgment as Annexe 4. Before Al Khawaja, while the Strasbourg Court had repeatedly recited the sole or decisive test, there had, as the Court of Appeal observed, been no case where that test had been applied so as to produce a finding of a violation of article 6(1) and (3)(d) in a case where there had been justification for not calling a witness and where the evidence was demonstrably reliable. Nor had the sole or decisive rule ever been applied or cited in an application in relation to the criminal process in this jurisdiction. Thus no consideration had been given as to whether it was necessary or appropriate to apply that rule having regard to the safeguards inherent in our system. It is time to turn to consider Al Khawaja. Al Khawaja In Al Khawaja 49 EHRR 1 the Court heard two applications together. Mr Al Khawaja had been convicted on two counts of indecent assault on female patients. The first had made a statement to the police providing details of the assault, but subsequently committed suicide for reasons unconnected to the assault. Her statement was admitted under the 1988 Act. Mr Tahery was convicted of wounding with intent. An Iranian had been stabbed in the back in a brawl. Another Iranian made a statement to the police saying that he had seen Mr Tahery inflict the wound. He subsequently refused to give evidence because of fear. The judge gave permission for his statement to be read pursuant to section 116(2)(e) of the 2003 Act. Appeals by each applicant were dismissed by the Court of Appeal. Each applicant complained to the Strasbourg Court that his rights under article 6(3)(d) had been violated. out general principles applicable to both cases. This section began: In the section of its judgment dealing with the merits the Court began by setting Article 6(3)(d) is an aspect of the right to fair trial guaranteed by article 6(1), which, in principle, requires that all evidence must be produced in the presence of the accused in a public hearing with a view to adversarial argument (Krasniki v Czech Republic (Application No 51277/99), 28 February 2006, para 75). As with the other elements of article 6(3), it is one of the minimum rights which must be accorded to anyone who is charged with a criminal offence. As minimum rights, the provisions of article 6(3) constitute express guarantees and cannot be read, as it was by the Court of Appeal in Sellick (see para [25] above), as illustrations of matters to be taken into account when considering whether a fair trial has been held (see Barber v Spain (1987) 9 EHRR CD101, paras 67 and 68; Kostovski v The Netherlands, (1989) 12 EHRR 434, para 39). I find it impossible to reconcile this paragraph with statements of principle that the Strasbourg Court has regularly made in respect of the interrelationship between articles 6(1) and 6(3)(d), as quoted from Kostovski at paragraph 75 (above). These statements indicate that the fairness of a trial has to be assessed on a case by case basis, viewing each trial as a whole, and that an inability on the part of a defendant to examine the maker of a statement that is admitted in evidence will not necessarily render the trial unfair. The statement of principle in the opening passage in Kostovski is notably absent from the judgment in Al Khawaja. That which replaces it is at odds with the approach in the individual Strasbourg cases to which I have referred. The Court went on to add: Equally, even where those minimum rights have been respected, the general right to a fair trial guaranteed by article 6(1) requires that the Court ascertain whether the proceedings as a whole were fair. This proposition is unexceptionable. What is puzzling is that the Court should cite Unterpertinger v Austria in support of it, for that was a case where the Court found that both articles 6(1) and 6(3)(d) had not been satisfied. said: I now come to the crucial passages in Al Khawajia. At paragraph 36 the Court Whatever the reason for the defendants inability to examine a witness, whether absence, anonymity or both, the starting point for the Courts assessment of whether there is a breach of article 6(1) and (3)(d) is set out in Luc at para 40: If the defendant has been given an adequate and proper opportunity to challenge the depositions either when made or at a later stage, their admission in evidence will not in itself contravene article 6(1) and (3(d). The corollary of that, however, is that where a conviction is based solely or to a decisive degree on depositions that have been made by a person whom the accused has had no opportunity to examine or to have examined, whether during the investigation or at the trial, the rights of the defence are restricted to an extent that is incompatible with the guarantees provided by article 6 [references omitted]. The first point to be made about this citation from Luc is that neither of the propositions that it contains is axiomatic. For reasons that I have already given, an opportunity to challenge a deposition when made, whether the opportunity is taken or not, will not necessarily render it fair at the trial simply to read the deposition if the maker can be called to give evidence. The second proposition incorporates the sole or decisive test. That test is not the corollary of the first proposition. It is not to be found in article 6(3)(d). It has, as I have shown, been developed in the jurisprudence of the Strasbourg Court. In both Al Khawaja and Tahery the statements admitted in evidence were central to the prosecution case but were, in each case, supported by other evidence. The Court of Appeal had held, in each case, that there was no reason to doubt the safety of the conviction. In Al Khawaja, the Court of Appeal, citing Sellick, had held that the Strasbourg case law did not require the conclusion that, in the circumstances of that case, the trial would be unfair. The Strasbourg Courts response appears in paragraph 37 of its judgment: The Court notes that in the present cases the Government relying on the Court of Appeals judgment in Sellick (see paragraph 25 above), argue that this Courts statement in Luc and in other similar cases is not to be read as laying down an absolute rule, prohibiting the use of statements if they are the sole or decisive evidence, whatever counterbalancing factors might be present. However, the Court observes that the Court of Appeal in Sellick was concerned with identified witnesses and the trial judge allowed their statements to be read to the jury because he was satisfied that they were being kept from giving evidence through fear induced by the defendants. That is not the case in either of the present applications and, in the absence of such special circumstances, the Court doubts whether any counterbalancing factors would be sufficient to justify the introduction in evidence of an untested statement which was the sole or decisive basis for the conviction of an applicant. While it is true that the Court has often examined whether the procedures followed in the domestic courts were such as to counterbalance the difficulties caused to the defence, this has been principally in cases of anonymous witnesses whose evidence has not been regarded as decisive and who have been subjected to an examination in some form or other. There are two points to be made about this passage. The first is that the Court appears to have accepted that the sole or decisive rule does not apply so as to preclude the reliance on the statement of a witness who refuses to testify because of fear induced by the defendant. The second is that the Court did not completely close the door to the possibility of counterbalancing factors being sufficient to justify the introduction of a statement as sole or decisive evidence in other circumstances. The Court made it quite plain, however, that compliance with the statutory regime under which the statements in the two appeals had been admitted carried limited weight paragraph 40. The Court must surely have been correct to recognise that the sole or decisive rule does not apply where a defendant has induced such fear in a witness that the witness refuses to testify. A defendant can never be heard to complain of the absence of a witness if he has been responsible for that absence. It is, however, notoriously difficult for a court to be certain that a defendant has threatened a witness, for if the threat is effective the witness is likely to be too frightened to testify to it. The Strasbourg Court has recognised that anonymity can be justified where a witness is too frightened to be identified, even where the defendant has not himself induced the fear Doorson, Kok and Visser. There are strong reasons of policy why the evidence of such a witness should be received, subject to adequate safeguards, and this is recognised by section 116 of the 2003 Act. The sole or decisive rule was first propounded in Doorson as an obiter observation, without explanation or qualification. It has since frequently been repeated, usually in circumstances where there has been justification for finding breaches of article 6(1) and (3)(d) without reliance on the test. If applied rigorously it will in some cases result in the acquittal, or failure to prosecute, defendants where there is cogent evidence of their guilt. This will be to the detriment of their victims and will result in defendants being left free to add to the number of those victims. The Court of Appeal in this case, comprising five senior judges with great experience of the criminal jurisdiction, referred to the manner in which the 2003 Act is working in practice and concluded that provided its provisions are observed there will be no breach of article 6 and, in particular, article 6(3)(d), if a conviction is based solely or decisively on hearsay evidence paragraph 81. The court thus differed from the doubt expressed in Al Khawaja as to whether there could be any counterbalancing factors sufficient to justify the introduction of an untested statement which was the sole or decisive basis for a conviction. I concur in these conclusions reached by the Court of Appeal and the reasons for those conclusions so clearly and compellingly expressed. The jurisprudence of the Strasbourg Court in relation to article 6(3)(d) has developed largely in cases relating to civil law rather than common law jurisdictions and this is particularly true of the sole or decisive rule. In the course of the hearing in Al Khawaja, Sir Nicolas Bratza observed that both parties had accepted the sole or decisive test which appears in Luc and other cases as an accurate summary of the Courts case law. He asked whether there was any authority of the Court which gave any scope for counterbalancing factors in a sole or decisive case. Mr Perry for the Government conceded that he was not aware of any direct authority on the point. The Court then applied the sole or decisive rule in reliance on the pre existing case law. But as I have shown that case law appears to have developed without full consideration of the safeguards against an unfair trial that exist under the common law procedure. Nor, I suspect, can the Strasbourg Court have given detailed consideration to the English law of admissibility of evidence, and the changes made to that law, after consideration by the Law Commission, intended to ensure that English law complies with the requirements of article 6(1) and (3)(d). In these circumstances I have decided that it would not be right for this court to hold that the sole or decisive test should have been applied rather than the provisions of the 2003 Act, interpreted in accordance with their natural meaning. I believe that those provisions strike the right balance between the imperative that a trial must be fair and the interests of victims in particular and society in general that a criminal should not be immune from conviction where a witness, who has given critical evidence in a statement that can be shown to be reliable, dies or cannot be called to give evidence for some other reason. In so concluding I have taken careful account of the Strasbourg jurisprudence. I hope that in due course the Strasbourg Court may also take account of the reasons that have led me not to apply the sole or decisive test in this case. The individual appeals Although the principal ground of appeal was that the sole or decisive rule had not been applied, counsel for the appellants in each appeal also argued that, quite apart from this rule, the relevant statements should not have been admitted. In the case of Horncastle and Blackmore the argument was that the deceased victims statement was inherently unreliable. In the case of Marquis and Graham it was argued that the fear that had led to Miss Miles running away because she was too frightened to give evidence had been induced, not by the defendants, but by alarmist warnings given by the police and that, in these circumstances, it was unjust to put her statement in evidence. These points received careful consideration by the Court of Appeal. I have found no basis for differing from the courts conclusion that they were without merit. Accordingly I propose simply to rely upon the reasoning of the Court of Appeal in dismissing these grounds of appeal. For the reasons that I have given I would dismiss these appeals. ANNEXE 1 (Prepared by Lord Mance see paragraph 41). 1. In Canada, the Supreme Court addressed the question of the admission of hearsay evidence on three occasions, in R v Khan [1990] 2 SCR 531; R v Smith [1992] 2 SCR 915 and R v Rockey [1996] 3 SCR 829. It noted that the purpose and reason of the Hearsay rule is the key to the exceptions to it, drawing in this connection on the well known American text, Wigmore on Evidence (2nd ed. 1923). Wigmore went on to point out that the theory of the hearsay rule was that the many possible sources of inaccuracy and untrustworthiness which may lie underneath the bare untested assertion of a witness can best be brought to light and exposed, if they exist, by the test of cross examination, but that, in circumstances in which a statement is free from this risk or in which cross examination is impossible, it may be possible under certain conditions to contemplate its use without cross examination. The Supreme Court of Canada in R v Smith, at p 930, referred to the approach 2. along these lines first adopted in R v Khan as the triumph of a principled analysis over a set of ossified judicially created categories. It held that, in addition to the basic requirement of relevance, hearsay evidence might be admitted if there was sufficient necessity and its reliability could be sufficiently verified by the judge before it was put before the jury. In R v Khan evidence was thus admitted of an infant complainants description to her mother shortly after the event of a sexual assault upon her, in circumstances where the infant was not permitted to testify at trial. In R v Smith these tests were satisfied in relation to the contents of two of the 3. critical three telephone calls made by the deceased to her mother shortly before death. However, in relation to the third call, although there was no problem about satisfying the test of necessity in view of her death, a careful review by the Court of the circumstances surrounding the call gave rise to apprehensions about its reliability, and a possibility that what had been said might have been mistaken or intended to deceive the mother. The contents of this call could not therefore safely be admitted in the absence of cross examination. The conviction was set aside and a fresh trial ordered. R v Rockey was another case, like R v Khan, where the accused was charged with sexual assault on an infant (aged two and a half), who had made a number of statements about the incident. The Court was, after examination of the circumstances, satisfied that the requirements of both necessity and reliability were met. It found, with regard to necessity, that the infant though by now aged five, could not have given evidence in any meaningful sense, and would anyway have been traumatised by doing so. Reliability was not an issue on the appeal. If (which the Court did not decide) there was any error in the judges directions to the jury, it was immaterial. It is right to add that, in this case (in contrast to R v Khan and R v Smith), there was also strong surrounding evidence inculpating the accused. 4. In Australia in the case of Bannon v The Queen (1995) 185 CLR 1, the High Court of Australia noted the Canadian decisions. Brennan CJ at p 12 expressed the view (obiter) that the approach they took should not be adopted in Australia. The other judges, Deane J at pp 12 13, Dawson, Toohey and Gummow JJ at pp 24 25 and 28 and McHugh J at pp 40 41 said that it was unnecessary to decide whether it should be adopted, although McHugh J also went further and said that Adoption of the Canadian principle would undoubtedly have beneficial effects on the law of evidence. The case was actually decided on the basis that the evidence in question could not on any view be regarded as reliable and was rightly excluded from being put before the jury. 5. As McHugh J also noted, the federal Australian Parliament had enacted the Evidence Act 1995, and New South Wales had adopted comparable legislation. The federal Evidence Act 1995 contains a careful set of provisions regulating the admission of hearsay evidence. The starting point under s.59(1) is that hearsay evidence is generally excluded: 59(1). Evidence of a previous representation made by a person is not admissible to prove the existence of a fact that it can reasonably be supposed that the person intended to assert by the representation. (2) Such a fact is in this Part referred to as an asserted fact. There follow a number of specific exceptions, including: 65 Exception: criminal proceedings if maker not available (1) This section applies in a criminal proceeding if a person who made a previous representation is not available to give evidence about an asserted fact. (2) The hearsay rule does not apply to evidence of a previous representation that is given by a person who saw, heard or otherwise perceived the representation being made, if the representation: (a) was made under a duty to make that representation or to make representations of that kind; or (b) was made when or shortly after the asserted fact occurred and in circumstances that made it unlikely that the representation is a fabrication; or (c) was made in circumstances that make it highly probably that the representation is reliable; or (d) was: (i) against the interests of the person who made it at the time it was made; and (ii) made in circumstances that make it likely that the representation is reliable. 66 Exception: criminal proceedings if maker available (1) This section applies in a criminal proceeding if a person who made a previous representation is available to give evidence about an asserted fact. (2) If that person has been or is to be called to give evidence, the hearsay rule does not apply to evidence of the representation that is given by: (a) that person; or (b) a person who saw, heard or otherwise perceived the representation being made; if, when the representation was made, the occurrence of the asserted fact was fresh in the memory of the person who made the representation. The scheme of the Australian statute is both nuanced and circumscribed, with a view to ensuring the overall fairness of the proceedings. The admissibility of hearsay evidence has also been addressed in New Zealand. In 6. 1980 the legislature enacted the Evidence Amendment Act (No.2) 1980. S.3 enabled the admission of out of court statements made by a maker with personal knowledge of the contents who is unavailable to give evidence, provided that the statement was not made in contemplation of criminal proceedings (and would not otherwise be inadmissible therein). S.18 gave the trial judge a discretion to exclude any such statement from the jury, and s.19 enabled an appellate court to exercise an independent discretion on any appeal to it on the issue of admissibility. The operation of these statutory provisions was considered by the Court of Appeal in R v Hovell [1987] 1 NZLR 610. In that case, an 82 year old woman gave to a detective shortly after the event a detailed written account of indecencies perpetrated on her by a disguised intruder whom she was unable to describe in any detail. There was medical and scientific evidence corroborating recent sexual activity. The next year, before the defendants arrest, she died. Her statement was admitted in evidence. On appeal, it was submitted that it should have been excluded under s.18, in that it would be contrary to the interests of justice not to exclude a statement dealing with facts of such central importance to the case (p.612). The Court of Appeal dismissed the appeal, holding that there was no basis for limiting the admission of such statements to less serious cases or to peripheral evidence, that the Act had its own safeguards for an accused, that it could not seriously be suggested that the complainants account was a fabrication, or that a woman of that age in those circumstances would complain of rape and the other sexual indignities if she had in fact consented, that the trial judge had rightly concluded that the identity of the assailant was the only issue for the jury and that the trial would be fought around the alibi claimed by the accused. The appeal was thus dismissed. 7. R v Baker [1989] 1 NZLR 738 concerned the common law principle whereby evidence of out of court statements may be admitted to show the makers state of mind, where this is a relevant issue. The defendant was accused of having raped and then shot his estranged wife before attempting to commit suicide. His explanation was that she had invited him around to shoot stray cats, and that, after inviting him to consensual sex, she had then taken his gun and shot first him, then herself. To rebut this account, the prosecution wished to adduce evidence from several witnesses of statements made by the deceased in the previous month and as late as the afternoon before her death as to her extreme fear of the accused which made it implausible to suggest that she would have invited him round to shoot stray cats or invited him to have sex. The trial judge refused to admit the statements, and the prosecution appealed. Giving the main judgment in the Court of Appeal allowing the appeal, Cooke P said (at p.741) that At least in a case such as the present it may be more helpful to go straight to basics and ask whether in the particular circumstances it is reasonably safe and of sufficient relevance to admit the evidence notwithstanding the dangers against which the hearsay rule guards. 8. R v Baker and the later case of R v Bain [1996] 1 NZLR 129 were considered in R v Manase [2001] 2 NZLR 197, as were also the Canadian and Australian cases to which I have already referred. This was another case of an infant (aged three and a half) who was the alleged victim of sexual violation by rape and otherwise. She had made statements to her mother and a receptionist, which she could not now remember having made, as well as making certain drawings in the receptionists presence. The trial judge had admitted evidence from the mother and receptionist about these statements and drawings. The Court of Appeal, reviewing the Canadian authorities, concluded that they had in practice diluted too far the concept of necessity (p.202). It noted certain recognised categories of exception to the hearsay rule, such as dying declarations and statements made as part of the res gestae. In other cases, the Court said, it was necessary to develop criteria for identifying when the rule might be displaced. I note, in parenthesis, that this is also the approach adopted by the federal Australian Evidence Act 1995 (above). The criteria which the Court developed involved three distinct requirements: 9. under the three distinct headings of relevance (although, as the Court noted, this is an affirmation and a reminder of the overriding criterion for the admissibility of all and any evidence), inability (which the Court indicated should be approached strictly) and reliability. In relation to this last criterion, the Court said: 30. The hearsay evidence must have sufficient apparent reliability, either inherent or circumstantial, or both, to justify its admission in spite of the dangers against which the hearsay rule is designed to guard. We use the expression apparent reliability to signify that the judge is the gatekeeper and decides whether to admit the evidence or not. If the evidence is admitted, the jury or judge, as trier of fact, must decide how reliable the evidence is and therefore what weight should be placed on it. If a sufficient threshold level of apparent reliability is not reached, the hearsay evidence should not be admitted. The inability of a primary witness to give evidence is not good reason to admit unreliable hearsay evidence. 31. As a final check, as with all evidence admitted before a jury, the Court must consider whether hearsay evidence which otherwise might qualify for admission should nevertheless be excluded because its probative value is outweighed by its illegitimate prejudicial effect. Reviewing the facts of R v Manase, the Court of Appeal concluded that there was a lack of sufficient apparent reliability in the primary utterances and drawings to qualify them for admission as hearsay. The appeal was therefore allowed. ANNEXE 2 (See paragraph 77) 1. In Unterpertinger v Austria (1986) 13 EHRR 175 at paragraph 33 the Court held that there had been a breach of article 6(1), taken together with the principles inherent in paragraph (3)(d) where the conviction was based mainly on statements of two witnesses that had been read. The witnesses had exercised a legal right, as members of the applicants family, to refuse to testify against him. 2. In Bricmont v Belgium (1989) 12 EHRR 217 at paragraph 82 the Court held that it was necessary to determine to what extent convictions had been based on accusations made by a witness whom the applicant had been unable to cross examine, where the Court had not found justification for this. 3. In Kostovski v The Netherlands (1989) 12 EHRR 434 in finding a violation of article 6 the Court remarked at paragraph 44 that the Government accepted that the applicants conviction was based to a decisive extent on the anonymous statements. The Court did not find justification for the procedures adopted, albeit that it recognised that the growth in organised crime doubtless demands the introduction of appropriate measures paragraph 44. 4. In Windisch v Austria (1990) 13 EHRR 281 the Court held that there had been a violation of paragraph (3)(d) taken together with paragraph (1) of article 6 where the court had relied to a large extent on identification evidence in the form of statements to the police of two anonymous witnesses. They had been promised anonymity by the police because of fear of reprisals. 5. In Delta v France (1990 16 EHRR 574 at paragraph 37 the Court found that there had been a breach of paragraph (3)(d) taken together with paragraph (1) of article 6 where statements of two witnesses had been taken into accountdecisivelyas the file contained no other evidence. There was no justification for the failure to procure the attendance of the witnesses. 6. In X v United Kingdom (1992) 15 EHRR CD 113 the Commission found that a complaint under article 6(1) and (3)(d) was manifestly ill founded where it related to evidence given by anonymous witnesses where far from being the only item of evidence on which the trial court based its decision to convict, the evidence in question did not implicate the applicant at all. The identity of the witnesses had been concealed because of fear of reprisals. In Ldi v Switzerland (1992) 15 EHRR 173 the Court found a violation of 7. paragraph (3)(d) in conjunction with paragraph (1) of article 6. The applicant had been convicted of drug trafficking. The evidence admitted at the trial had included reports made by an anonymous undercover police agent. While the Court found that there was justification for anonymity it ruled that this need not have precluded a procedure that permitted the witness to be questioned. The Swiss Government had argued that there had been no breach of article 6(1) and (3)(d) because the conviction had not been based to a decisive extent on the agents evidence. The Court observed at paragraph 47 that, while the Swiss courts did not reach their decisions solely on the basis of the agents statements, these played a part in establishing the facts which led to the conviction. 8. In Sadi v France (1993) 17 EHRR 251 the Court found that there had been a violation of article 6(1) and (3)(d). The applicant was convicted of drug dealing on the sole evidence of statements made to the police by three of his customers, who were identified. The Court did not find that there was any justification for failing to call them. ANNEXE 3 (See paragraph 80) 1. In Van Mechelen v The Netherlands (1997) 25 EHRR 647 the applicants had been convicted of attempted manslaughter and murder, where the only evidence of positive identification was supplied by anonymous police officers whose evidence was not taken in the presence of the applicants or their counsel. The Court did not find that the procedure adopted was justified but, having cited the sole or decisive test as set out in Doorson, added at paragraph 63 that the conviction of the defendants was based to a decisive extent on the evidence of the police officers. 2. In Craxi v Italy (Application No 34896/97), 5 December 2002 the applicant was convicted solely on the basis of statements of co defendants who exercised their rights not to give evidence. The Court held that there had been a violation of article 6(1) and (3)(d). Statements of one witness were read on the ground that he was untraceable. The Court held that these statements had not contributed to the applicants conviction, so there was no need to consider his complaint that their admission had violated article 6(3)(d). 3. In Kok v The Netherlands (Application No 43149/98), Reports of Judgments and Decisions 2000 VI, p 597 the Court found the applicants complaint of a violation of article 6(1) and (3)(d) to be manifestly ill founded. The evidence placed before the court included a statement made by an informer. His identity was not disclosed in order to protect him from reprisals and the Strasbourg Court held that there was justification for this. In applying the sole or decisive test, the Court said this: The Court therefore concludes that in the present case the applicants conviction was not based exclusively or to a decisive extent on the evidence of the anonymous witness. In the Courts view, in assessing whether the procedures involved in the questioning of the anonymous witness were sufficient to counterbalance the difficulties caused to the defence due weight must be given to the above conclusion that the anonymous testimony was not in any respect decisive for the conviction of the applicant. The defence was thus handicapped to a much lesser degree. In Luc v Italy 36 EHRR 807 the applicant had been convicted on the sole basis of 4. a statement of a co accused, who had exercised his right not to give oral evidence and whom neither the applicant nor his counsel had had the right to question. The Court held that there had been a violation of articles 6(1) and 6(3)(d). 5. In PS v Germany (2001) 36 EHRR 1139 the applicant had been convicted of sexual assault on an 8 year old girl on the basis of statements that she had made which were the only direct evidence of his guilt, so that the conviction was based on the statements to a decisive extent. She was not called to give evidence and the Court found that there were shortcomings in the procedure that had been used. The Court held that there had been a violation of paragraph (3)(d) taken in conjunction with paragraph (1) of article 6. 6. In Visser v The Netherlands (Application No 26668/95), 14 February 2002 the applicants conviction had been based to a decisive extent on the statement of an anonymous witness who was not called to give evidence. The Court held that justification for this had not been demonstrated and that there had been a violation of articles 6(1) and 6(3)(d). The court recited the sole or decisive test. It also recited the passage from Kok, which I have quoted above. 7. In Birutis and others v Lithuania (Application Nos 47698/99 and 48115/99), 28 March 2002 the applicants had been convicted of taking part in a prison riot. A number of anonymous statements were admitted in evidence. The Court held that there was justification for the anonymity, but found a failure to take steps that were available to check the reliability of the statements. The Court found that one of the applicants had been convicted solely on the basis of such statement evidence, but that in the case of the other two such evidence had not been sole or decisive, but that the anonymous statements were among the grounds upon which their convictions were based paragraph 32. A violation of article 6(1) and (3)(d) was found in the case of each applicant. In Krasniki v Czech Republic (Application No 51277/99), 28 February 2006 the 8. applicant was convicted of drug offences on the basis of the statement of an anonymous witness. The Court found a violation of article 6(1) and (3)(d) taken together. The Court was not satisfied that the anonymity was justified and also held that the applicant had been convicted solely or at least to a decisive extent on the anonymous evidence. Once again the Court recited the passage that I have cited from Kok: paragraph 79. 9. In Taxquet v Belgium (Application No 926/05), 13 January 2009 the applicant had been convicted of murder and attempted murder at a trial where the statement of an anonymous witness had been admitted. The Court was not satisfied that anonymity was justified. The Court was unable to determine whether the conviction was based on objective evidence, or solely on the information supplied by the anonymous witness, orsolely on the statement by one of the co defendants accusing him. The Court found a violation of articles 6(1) and 6(3)(d). ANNEXE 4 (Prepared by Lord Judge see paragraph 93) 1. In this annexe references to the Domestic Position refer to the position in England and Wales. With one or two exceptions, this document only addresses cases cited to the House in which the ECtHR found the European Convention on Human Rights (the Convention) to have been violated. In relation to the non violation cases, the purpose behind their inclusion is that they illustrate that the absence of a violation of article 6 entitlements may nevertheless produce a conviction which would be regarded domestically as unsafe. 2 6 10 14 17 21 26 31 41 46 55 60 65 70 76 82 86 91 Contents Reference (1986) 13 EHRR 175 (1989) 12 EHRR 217 (1989) 12 EHRR 434 (1990) 13 EHRR 281 (1990) 16 EHRR 574 (1992) 15 EHRR173 (1993) 17 EHRR 251 (1996) 22 EHRR 330 (1996) 23 EHRR 288 (1997) 25 EHRR 647 (1999) (Application No 37019/97) (2001) 36 EHRR 807 (2001) 36 EHRR 1139 (2002) (Application No 26668/95) (2002) (Application Nos 47698/99 and 48115/99) (2003) 36 EHRR 431 (2006) (Application No 51277/99) (2009) (Application No 926/05) Category of Witness Paragraph Absent, identified Absent, identified Absent, anonymous Absent, anonymous Absent, identified Absent, anonymous Absent, identified Combination Absent, identified Anonymous present Absent identified Absent identified Absent Identified Anonymous, present in part Anonymous, absent Absent, identified Anonymous, absent, present Absent, anonymous Case Unterpertinger v Austria Bricmont v Belgium Kostovski v The Netherlands Windisch v Austria Delta v France Ldi v Switzerland Sadi v France Doorson v The Netherlands Ferrantelli and Santangelo v Italy Van Mechelen and others v The Netherlands AM v Italy Luc v Italy PS v Germany Visser v The Netherlands Birutis and others v Lithuania Sadak and others v Turkey Krasniki v Czech Republic Taxquet v Belgium Unterpertinger v Austria (1986) 13 EHRR 175 2. This case involves known, absent witnesses; the applicant was convicted of causing actual bodily harm to his step daughter on 14 August 1979 and grievous bodily harm (a fractured thumb) on 9 September 1979. During the first incident the applicant himself received injuries. The police were informed by a neighbour. His wife was questioned as a suspect, and his step daughter as a person involved. They made statements about the incident. Shortly afterwards the second incident occurred. The applicants wife received treatment for her injuries. The injury and incident were reported to the police by the hospital. In due course statements from the applicant and his wife were supplied by the hospital to the police. A judicial investigation into both incidents took place. During the investigation the wife gave an account of both incidents. She was later acquitted of criminal involvement in the first incident. When the wife and step daughter were informed by the trial court of their right to refuse to testify against the applicant, they did so. This meant that their oral testimony was not available at trial, and indeed the interview conducted with the wife during the judicial investigation was also excluded. The prosecution adduced the earlier statements to the police by the wife and step daughter. Evidence which was said to undermine their credibility was not admitted, although the statements in relation to the first incident had been obtained when they were questioned as a suspect and a person involved respectively. 3. Following a finding by the Commission that there was no violation, the ECtHR held that the applicants rights under articles 6(1) and 6(3)(d) were breached. The applicant was convicted on the basis of testimony in respect of which his defence rights were appreciably restricted (para 33). Domestic Position 4. would be quashed. 5. The oral testimony of both the wife and the step daughter is admissible. Both were available to give evidence, and they should have been called. Neither fell within the admissibility provisions in section 116. Any attempt to use the section 114(1)(d) route would have failed the interests of justice test. The statements before the trial court from the wife were incomplete, because her account to the investigating judge was not available. Yet every pre trial statement of any witness should be available for cross examination purposes. In any event, however, the applicant was prevented from challenging the credibility of the witnesses, or calling evidence to undermine it. No measures whatever were available or could be or were taken to protect the applicants position. A conviction on the basis of the evidence admitted in this case would be unsafe: in reality there would have been no trial. Bricmont v Belgium (1989) 12 EHRR 217 This trial would simply not proceed on this basis, and if it did, any conviction The ECtHR held that in relation to the charges which had not been subject to the 6. This conviction involved a known absent witness, the Prince of Belgium. He could not be summoned as a witness in the absence of a specific Royal decree. The trial court found that there was a clear and inexplicable want of diligence in seeking the truth (para 28) and noted that the persons best placed to provide information had been neither summoned nor examined as witnesses (para 28(a)). The applicant was acquitted of criminal charges brought against him on the basis of financial mismanagement. 7. The acquittal was appealed by the prosecution. The Court considered regrettable that evidence had been taken from the Prince in an unusual manner nevertheless, by allowing the prosecution to use the written statement of the alleged victim of the fraud without producing him for cross examination because he was old and ill, the applicant was convicted. 8. confrontation, there had been a violation of article 6(1) and (3)(d) taken together. Domestic Position 9. Ignoring the complicating factor that in Belgium the victims status as a member of the Royal Family gave him special privileges in the proceedings, which would not have been the case here, the admission of his untested evidence would have been highly unusual. The prosecution would have had to persuade the court that his written statement should be admitted under section 116(2)(b). In practical reality such an application would have been very surprising, and if made, would have failed the interests of justice test. There was no sufficient explanation for the inability of the witness to give oral testimony, and the trial court itself had serious reservations about the reliability of the evidence adduced from the complainant. If the Court of Appeal concluded that there had been a want of diligence in seeking the truth which was inexplicable or that the judge misdirected himself in relation to the interests of justice any conviction would be quashed as unsafe. Kostovski v The Netherlands 12 EHRR 434 10. This case concerned absent, anonymous witnesses. The applicant was convicted by the District Court, and, later, the Amsterdam Court of Appeal of conducting an armed robbery. The applicants conviction was based to a decisive extent on the statements of anonymous witnesses. Anonymous statements were made to the police and examining magistrates. The examining magistrate invited questions for him to put to the witness; of the 14 questions submitted by the applicants lawyers, only 2 were answered, on the basis that the remaining 12 may have breached the anonymity of the witness. The witnesses were not examined at trial. The witnesses identities were not known either to the examining magistrates or to the trial courts. The magistrates testified that, on the basis of their assessments, the anonymous witnesses were not unreliable and completely reliable. 11. The ECtHR held there had been a violation of articles 6(1) and 6(3)(d) taken together. At paragraphs 41 and 42, the Court noted that the use of statements acquired at the pre trial investigative stage was not in itself inconsistent with paragraphs (3)(d) and (1) of article 6 providing the defence had the opportunity to challenge and question a witness, but that, on this occasion, the nature and scope of the questions it could put [via the examining magistrates earlier in the proceedings] was considerably restricted by reason of the decision that the anonymity of the authors of the statements should be preserved. It is significant that the Court ascribed the problems associated with anonymous witnesses to the decision to render the witnesses anonymous; this suggests that the process by which the court arrived at the decision to grant anonymity was flawed, rather than the fact of anonymity per se. 12. The Court recognised the policy in favour of the use of anonymous evidence (para 44) but held that the general problems of anonymity were compounded by the absence of the anonymous witnesses at trial, and the subsequent admission of their evidence as hearsay see para 43. However, in concluding that paragraphs (1) and (3)(d) of article 6 of the Convention had been breached, it is significant that the Court noted that the right to a fair administration of justice. cannot be sacrificed to expediency(emphasis added); by contrast, the relevant considerations for the granting of anonymity, in section 5 of the 2008 Act, would not, on any reading, permit the granting of an order for reasons of expediency. Domestic Position 13. This case would not come to trial. If it did, it would be stopped. This evidence was anonymous hearsay. The relaxation of some of the rules against the use of anonymous witnesses under the Criminal Evidence (Witness Anonymity) Act 2008 does not extend to witnesses who are not only anonymous but also absent. In R v Mayers [2008] EWCA Crim 2989; [2009] 1 Cr App R 403, para 113, the Court of Appeal (Criminal Division) addressed an application by the Crown that a written statement by an anonymous absent witness should be admitted in evidence and read to the jury, and summarised the principle: we are being invited to re write the [Criminal Evidence (Witness Anonymity) Act 2008] by extending anonymous witness orders to permit anonymous hearsay evidence to be read to the jury. We cannot do so. Neither the common law, nor the [Criminal Justice Act 2003], nor the 2008 Act, permits it. In short, such evidence is inadmissible. Windisch v Austria (1990) 13 EHRR 281 14. The applicant was convicted of burglary on the basis of the anonymous, absent, testimony of two witnesses who had seen him in the vicinity of the area of the burglary, although they did not witness the crime itself. The witnesses were assured of anonymity by the police at the investigative stage, and their identity was kept from the Regional Court and the Supreme Court. On appeal, the Supreme Court refused the applicants request to have the witnesses summoned, on the basis that he had not established how the witnesses would be identified sufficiently to allow the summonses to be served. 15. The ECtHR noted, at para 31, that although the anonymous absent witnesses had not witnessed the crime itself, their testimony became the central issue during the investigation and at the hearing, and that the trial court relied, to a large extent on their testimony. Earlier in the judgment, at para 28, the Court stated that being unaware of their identity, the defence was confronted with an almost insurmountable handicap: it was deprived of the necessary information permitting it to test the witnesses reliability or cast doubt on their credibility. As such, the evidence involved such limitations on the rights of the defence that there had been a violation of para (3)(d), taken together with para (1), of article 6. Domestic Position 16. See paragraph 13 (above): the evidence would not be admissible. Delta v France (1990) 16 EHRR 574 17. This matter concerned an absent, identified witness. The applicant was convicted at the Paris Criminal Court, and, subsequently, at the Paris Court of Appeal and the Court of Cassation of the robbery of jewellery from two identified teenage girls. Upon being searched following his arrest, nothing incriminating was found on the applicant. The victims were the only witnesses, and, having provided statements to the police, failed to respond to court summons to attend as witnesses at the applicants trial. No reasons were given for their failure to do so. At the trial of first instance, the trainee barristers representing the applicant made no submissions in relation to the absent witnesses. 18. In upholding the conviction, the Paris Court of Appeal held that the absent witnesses statements satisf[ied] the Court that the defendant was guilty of the offences charged and [made] the requested examination of the witnesses unnecessary (para 20). The Court of Cassation refused to intervene in the appeal courts final assessment of all the evidence adduced and dismissed the appeal. 19. The ECtHR noted, at para 37, that neither the applicant nor his counsel ever had an adequate opportunity to examine witnesses whose evidence was taken into account decisively at first instance and on appeal, as the file contained no other evidence. They were therefore unable to test the witnesses reliability or cast doubt on their credibility The Court concluded that there had been a breach of article 6(3)(d) taken together with para (1). Domestic Position 20. The absence of the crucial witnesses for the prosecution was unexplained and unjustified. No attempt was made to trace them or compel their attendance, or to justify the reading of their statements. No countervailing measures to protect the interests of the defendant were or could be taken. An application for this evidence to be read would have failed the interests of justice test. Therefore if the case had proceeded to trial it would have been stopped, but if that safeguard had failed, and the case had resulted in a conviction, the conviction would have been quashed. Ldi v Switzerland (1992) 15 EHRR 173 21. This case concerned an anonymous, absent witness. The applicant was convicted of drug trafficking offences on the basis of the evidence of an absent and unidentified undercover police officer, operating with requisite official authorisation. The undercover officer initiated a series of meetings with the applicant in which, the officer testified, the applicant offered to sell large quantities of cocaine. The applicant was convicted by the District Court and, subsequently, by the Bern Court of Appeal and the Federal Court. In order to preserve his anonymity, the undercover officer was not called at trial; the court considered that telephone intercept records and the reports of the undercover agent were sufficient to establish the applicants criminality. 22. The Commission stated (at para 87) that the applicant did not have the opportunity to challenge and question the undercover officer, and noted that, while the applicant was convicted partly on the basis of his own admissions, those admissions were made when the applicant was confronted with intercept evidence by the undercover officer which he was unable to challenge in the trial proceedings. The Commission concluded that there was a breach of article 6(3)(d) taken together with article 6(1). 23. The ECtHR noted the operational requirement of law enforcement agencies to undertake intrusive and covert surveillance, but found that it would have been possible to preserve the anonymity of the undercover officer while simultaneously affording the applicant the opportunity to question him, or cast doubt on his credibility (para 49). This failure constituted a breach of article 6. Domestic Position 24. See paragraph 13 (above): the evidence would not be admissible. 25. In this particular case it is possible to go a little further: there was no reason to conceal the appearance of the undercover police officer from the applicant who had met him under his assumed identity on a number of occasions. So a witness anonymity order to preserve the true identity of the officer would nevertheless not prevent him from testifying in court, and therefore cross examined and challenged on the applicants behalf. It has already been recognised that: In relation to police officers the normal problem is not quite the same as that envisaged by orders for witness anonymity which were considered at the trial of Davis. These witnesses may well be known to the defendant by a false identity, or are using a false identity. Knowledge of their true identities can rarely be of any importance to the defendant, who can advance whatever criticisms of the evidence, or indeed the conduct of the officers, while they continue to be known by their false identities (R v Mayers [2009] 1 Cr App R 403, para 31). Effectively, the approach domestically and in Strasbourg would have been identical. It is unnecessary to address the admissibility of the telephone tap evidence: it is, to put it no higher, extremely unlikely that this evidence would have been admissible. Sadi v France (1993) 17 EHRR 251 26. This case involved identified, absent witnesses. The applicant was convicted in the Nice Criminal Court and, later, the Court of Appeal and Court of Cassation of the involuntary homicide of a fellow drug user, who died following the administration of drugs provided by the applicant. During the judicial investigation for that and other drugs related charges, the applicant was remanded in custody; one of the reasons for the detention at the time was the need to arrange witness confrontations. During his detention, the applicant was identified through a two way mirror by suspects detained by the police on other charges relating to drugs (see para 10) as the person responsible for providing them and the deceased with drugs. At trial and before the Court of Appeal, the applicant was convicted on the basis of statements made by these witnesses, who were absent from the trial. There was no positive attempt to conceal their identity nor to discuss the possibility of using other special measures, and on appeal no specific request was made for a confrontation. Nevertheless, stress was laid on Sadis behalf on the inadequacy of the investigation and the absence of any confrontation between him and his accusers. The Court of Cassation refused to interfere with the verdicts below. 27. The Commission noted (at para 44), that the applicant had been accused by his habitual [drug] clients and by the very persons who carried out some of his deliveries. It also noted that the applicant was found guilty on the sole basis of the statements of his accusers, and continued, the applicant should have been given the opportunity of being confronted with his accusers and thus enabled to put his own questions and comments about their statements. It concluded that there had been a violation of article 6. 28. Before the ECtHR, France argued that oral testimony was not required because (i) the file against the applicant was complete and confrontations would have served little purpose; and (ii) of the general difficulty of obtaining testimony from drug addicts, who may be fearful of reprisals arising from their cooperation with the authorities, made organising confrontations a sensitive matter. However no specific assertion was advanced that any of the witnesses was in fear of the applicant, or indeed his colleagues. 29. The ECtHR found (at para 44) that the convicting courts referred to no evidence other than the statements obtained prior to trial after the two way mirror identification. It also noted that the convicting courts themselves highlighted the relationship the witnesses bore to the applicant, namely that they were some of his regular customers and were those responsible for delivering consignments of drugs to other users. The failure to enable the applicant to examine the witnesses either at the investigative stage or at trial constituted a breach of article 6(1) and (3)(d). Domestic Position 30. This evidence would not be admitted. There was no good reason why the key witnesses could not be called and cross examined. Many witnesses in this class of case are reluctant to give evidence, but that does not constitute a sufficient basis for allowing hearsay evidence and disabling the defendant from challenging the evidence. In these cases witnesses are expected to give evidence: witness reluctance does not provide a sufficient basis for their absence, and in any event many of the concerns expressed by witnesses can be addressed by special measures. The crucial point is that the evidence of these witnesses was in issue, they were closely involved in the same drugs related question, and the circumstances in which their purported identifications took place required close examination. No countervailing measures offering appropriate protection to the applicants interests were available. The interests of justice required their oral testimony or the exclusion of their evidence. Doorson v The Netherlands (1996) 22 EHRR 330 31. This case concerned a combination of absent, identified, and anonymous witnesses. The applicant was convicted before the Amsterdam Regional Court and, later, by the Court of Appeal and the Supreme Court of drug trafficking. The applicant was identified from a photograph as a drug dealer by a number of witnesses who were known to be drug users. 32. Six of the witnesses who identified the applicant remained anonymous; the identity of a further two was disclosed. At first instance trial, the defence applied unsuccessfully for the court to summon the anonymous witnesses. Of the two identified witnesses, only one appeared at trial, initially testifying that he did not recognise the applicant. The witness subsequently purported to recognise the applicant when presented with the photograph from which he originally recognised him, though later admitted that he could not be sure, and that the reason he identified him to the police was in order to be reunited with his confiscated drugs. The evidence of a second absent but identified witness was read. The defence also questioned the failure of the prosecution to disclose details arising from identification of the applicant from photographs. The applicant was convicted. 33. The Court of Appeal requested the investigatory judge (who had been a member of the court in an earlier constitution of the Regional Court) to re examine the need for the witnesses continued anonymity and to question them on the applicants behalf. Two of the six anonymous witnesses attended the hearing before the investigatory judge. Their anonymity was upheld. They were questioned extensively by the judge and the applicants lawyer. They re identified the applicant from photographs put to them. In view of this questioning, and the fact it was not possible to secure the attendance of the remaining witnesses, the investigatory judge and Court of Appeal refused the applicants request to re summon all anonymous witnesses. The Court of Appeal and, later, the Supreme Court, upheld the conviction. 34. The Commission found by a majority there had been no breach of the Convention. 35. In summary, the conviction was based on (a) the oral evidence of one prosecution witness who deposed at trial, and retracted his statement to the police: (b) two anonymous witnesses who deposed orally and whom the defence could cross examine: (c) one witness who made a statement to the police and then disappeared. 36. The ECtHR found there was no breach of article 6(1) and (3)(d). In relation to anonymous witnesses, it articulated the following doctrine, at para 76, it should be recalled that, even when counterbalancing procedures are found to compensate sufficiently the handicaps under which the defence labours, a conviction should not be based either solely or to a decisive extent on anonymous statements 37. The Court continued that evidence obtained from witnesses, at para 76, under conditions in which the rights of the defence cannot be secured to the extent normally required by the Convention should be treated with extreme care. The Court is satisfied that this was done in the criminal proceedings leading to the applicants conviction, as is reflected in the express declaration of the Court of Appeal that it had treated [the anonymous testimony] with the necessary caution and circumspection. The Court held that the testimony from the absent but identified witness caused the applicant no unfairness because it was impossible to trace the witness, and the evidence was corroborated by other evidence before the court (para 80). In conclusion, therefore, the Court considered, None of the alleged shortcomings considered on their own lead the Court to conclude that the applicant did not receive a fair trial. Moreover, it cannot find, even if the alleged shortcomings are considered together, that the proceedings as a whole were unfair. Domestic Position 38. See paragraph 13: the anonymous witnesses did not give oral testimony at trial. Their evidence would not be admissible. The evidence of the witness who retracted his statement would have been judged by the jury. Given that the statement he made incriminating the applicant was rejected, the reliability of his allegations against the applicant would have been in serious doubt. 39. In relation to the identified witness who disappeared his written statement might have been admitted under section 116(2)(d) of the 2003 Act if the court had been satisfied all reasonably practicable steps had been taken to find him. However given that the witness was a known drug user, and the allegation against the applicant was drug trafficking, the absence of any opportunity for the defence to challenge the evidence would probably have led the court to exclude it. 40. A conviction would be most unlikely: and the case would probably be stopped. Ferrantelli and Santangelo v Italy (1996) 23 EHRR 288 41. This matter involved an absent, identified witness. The applicants, who were aged 17 and 18 at the time of the offence, were convicted of the murder of two police officers following statements provided to the police by a co accused. The co accused died before trial and before the applicants had the opportunity to examine him. During police questioning, the applicants admitted involvement in the attacks, but gave conflicting accounts and later claimed ill treatment. Three trials took place. The applicants were convicted 16 years following their initial arrest. 42. The Commission upheld the applicants complaints that there was excessive delay, in breach of article 6(1), and that the reliance on the statements of the deceased co accused was objectionable. The Commission held that the admission of the deceaseds statements was not per se objectionable, but that, at para 51, given the confession evidence taken with the evidence of the deceased co accused constituted the fundamental grounds for their conviction, there was a breach of article 6(1) of the Convention. 43. The ECtHR held that the delay amounted to a breach of article 6, in relation to the length of the proceedings, but that the reliance on the statement of the deceased co accused was compatible with the right to a fair trial contained in paragraphs (1) and (3)(d) of article 6. The reasoning for the latter conclusion appears to be because the Government could not be held responsible for the deceaseds death, and the fact that his evidence was corroborated by the applicants admissions to the police, other circumstantial evidence, and the lack of an alibi for either of them (see para 52). Domestic Position 44. Although this is a non violation case, it is worth noting that domestically, a trial taking place 16 years after the initial arrest of the defendants would almost certainly lead to an abuse of process argument, reinforced by the fact of prejudice to the defendants from their inability to cross examine a co accused whose statements to the police were relied on in support of the allegation against them. 45. For the same reason, given the absence of any opportunity for the defendants to test the accounts of the deceased co accused, although section 116(2)(a) provides that the statement of an identified, absent witness may be admitted as hearsay evidence where the witness is dead, admission in these circumstances would be likely to fail the interests of justice test under the 2003 Act and the fairness test under section 78(1) of the 1984 Act. In practice therefore the outcome of this case would have coincided with the decision of the Commission rather than the ECtHR itself. Van Mechelen and others v The Netherlands (1997) 25 EHRR 647 46. This case involved anonymous absent witnesses. The applicants were convicted of armed robbery and attempted murder on the basis of anonymous statements from police officers. The police officers were questioned by the investigatory judge in the shielded presence of the applicants and their lawyers who could hear but not see them. The officers did not testify at trial. 47. The Commission held by a majority that there had been no violation of article 6(1) and (3)(d), noting, at para 77, that article 6 does not grant the accused an unlimited right to secure the appearance of witnesses in court and, at para 79, that the applicants were suspected of having committed serious offences of violence. 48. Although anonymous testimony was received by an investigatory judge, it had been possible to challenge that evidence, (para 82) the Commission concluded that the applicants convictions did not solely rest on the statements by these unidentified witnesses, and continued to outline corroborative evidence, including tapped telephone conversations (para 84). 49. The ECtHR noted that special considerations apply where witnesses seeking anonymity were members of the police force of the State. The Court stated at para 60 that it had not been explained to the Courts satisfaction why it was necessary to resort to what it termed such extreme limitations and why less far reaching measures were not considered. The Court implied that it was not opposed to anonymous police testimony per se but that under the circumstances of the case, it had not been persuaded it was necessary; in the absence of further information, the Court cannot find that the operational needs of the police provide sufficient justification [for anonymity]. 50. The alleged threat of reprisals arising from testimony had not been assessed properly; anonymity was granted simply on the basis of the seriousness of the crime committed (para 61). Accordingly, the Court found that the convictions of the applicants were based to a decisive extent on anonymous statements and concluded that the proceedings taken as a whole were not fair (paragraphs 63 and 65), and there was a breach of article 6(1) taken together with article 6(3)(d). Domestic Position 51. Before considering whether it would be legally possible to apply for mass police anonymity, it is useful to consider whether such an application would actually be made, and whether those responsible for the application would deem such an application to be reasonable. In August 2008, the Director of Public Prosecutions issued Guidance on Witness Anonymity1 which states, under the section titled Considering whether to make an application, 1 http://www.cps.gov.uk/publications/directors_guidance/witness_anonymity.html#_08 Prosecutors must also be able to show that any fear expressed by the witness that they, or any other person, would suffer death or injury, or that there would be serious damage to property, if they were identified to the defendant, is reasonable (emphasis added). In this case it is open to very serious question whether an application for police anonymity would be made at all. 52. The Criminal Evidence (Witness Anonymity) Act 2008 contains no specific statutory provision relating to the anonymity of police officers: see para 25 (above) for further comment. 53. In the result, the conditions which would permit consideration to be given to the making of witness anonymity orders in this case were not established. Even on the basis that the justification for anonymity could be justified, the witnesses would nevertheless have been required to give oral testimony at trial, probably with the protection of special measures for them, which kept open the possibility of cross examination and challenge on behalf of the defendant. Incidentally, the views of the investigating judge about the credibility of the witnesses would be irrelevant and inadmissible: all decisions on credibility are the exclusive function of the jury on the basis of the evidence before them. 54. In reality, from the point of view of a trial before the jury, the way in which the evidence in the present case was actually presented that is, critical evidence from anonymous witnesses who were not present at trial would, even if permitted, have resulted in the quashing of any conviction. In effect, see paragraph 13: the evidence would not be admissible. AM v Italy (Application No 37019/97), 14 December 1999 55. The applicant was convicted of sexually assaulting G during a school trip G made to Italy. On his return to the United States G provided a detailed account of what took place to a US police officer. His father confirmed in interview that the child had made the complaint. Gs mother and Gs psychotherapist provided written statements confirming that G had recited to them the allegations against the applicant. The record of the account given by G and the other statements were used in evidence against the applicant. This case involved absent but identified witnesses. The international rogatory letter issued by the authorities in Italy explicitly asked the authorities in the USA to arrange for the witnesses to be questioned without a defence lawyer being present. 56. The ECtHR concluded, at para 26, in convicting the applicant the domestic courts relied solely on the statements made in the United States before trial and the applicant was at no stage in the proceedings confronted with his accusers 57. There was a breach of article 6(1) taken together with article 6(3). Domestic Position 58. Section 116(2)(c) of the CJA 2003 permits the admission of hearsay evidence where the relevant person is outside the United Kingdom and it is not reasonably practicable to secure his attendance. Before evidence can be introduced in this way it is necessary to show (a) that all reasonable steps have been taken to secure the presence of the witness; and (b) why those steps have failed. Moreover, assuming that this hurdle is cleared, it would then be necessary for the prosecution to show why other methods by which the evidence could be given, such as by means of a live link, would be impracticable. 59. Assuming that none of these steps to enable the jury to see the witness, or to enable the witness to be confronted by the defence could be taken, the starting point is that the statements of the father, mother and psychotherapist all constitute multiple hearsay obtained in circumstances where the investigating authorities expressly sought to arrange for the absence of a defence lawyer. In the circumstances of this case, that would have been likely to produce a decision under section 78 of the Police and Criminal Evidence Act 1984 excluding the evidence. But, if such an order were not made on the basis that the defendants lawyer did not press sufficiently for the opportunity to be present, the admission of the evidence would have been questioned as a step inconsistent with the interests of justice and section 78 would also have been engaged in the context of the adverse effect on the fairness of proceedings resulting from the admission of this evidence. The reality is that (a) the defendant could not defend himself against the allegations and (b) the jury would have no basis for making any assessment about the credibility and reliability of the makers of the statement. If the judge admitted the evidence he would have had to give the jury such clear directions about the dangers of convicting on the basis of such remote and untested evidence, that either (a) an acquittal would have been inevitable or (b) the Court of Appeal would quash the conviction on the basis, first, that the evidence should never have been admitted and, second, because the consequent conviction was unsafe. Luc v Italy (2001) 36 EHRR 807 60. This case involved an absent, but identified, witness. The applicant was convicted of drugs offences by the Locri Criminal Court and, later, the Court of Appeal and the Court of Cassation. An acquaintance of the applicant from the drugs world, N, made statements to the police, whilst detained as a suspect himself, which implicated the applicant. Italian law deemed N to be a person accused in connected proceedings against the applicant and, accordingly, N was permitted to refuse to testify. Further domestic provisions, triggered by Ns testimonial immunity, allowed the prosecution to read Ns statement to the Court. 61. Before the ECtHR the Italian Government argued that the domestic provisions highlighted the tension between the right of a co accused to remain silent, the right of the accused to question a witness against him, and the right of the judicial authority not to be deprived of evidence obtained during the investigation. In its summary of the facts, the ECtHR, at para 14, stated as a result [of the testimonial immunity provisions], the accused was deprived of any opportunity of examining [N] or of having him examined. It was irrelevant that the statements had been made by a co accused rather than a 62. witness; this illustrates the principle, found in many judgments relating to article 6(3)(d), that the term witness has an autonomous meaning within the Convention system. N, a co accused, was therefore a witness for these purposes. Accordingly, the Court was not satisfied that the applicant was given an adequate and proper opportunity to contest the statements on which his conviction was based and there had been a breach of article 6(1) and (3)(d). Domestic Position 63. Although described as a co accused, it appears from the judgment that the witness was an accused in a related but separate case. That said, he was entitled to and would have been warned that he was not obliged to give evidence which might incriminate him in any offence. Assuming that he elected not to give evidence, any oral statement he made during the police investigation would not have been admissible. An application could have been made for any written statement, taken in proper form, to be read to the jury. The evidence would not have been admissible under section 116, but the prosecution might have argued for its admissibility under section 114(1)(d). 64. In exercising his discretion whether to admit the evidence, the judge would have been alert to the dangers of admitting a statement made by a suspect who had exercised his right not to incriminate himself, and thus avoiding any challenge or cross examination. That consideration would then bear on issues of the potential unreliability of the maker of the statement, and the difficulties faced by the defendant, unable to meet the allegation head on, and the prejudice which would be likely to be occasioned to him. All these would provide overwhelming reasons against permitting the statement of the witness to be read. If nevertheless admitted, the judge would have been required to give the clearest possible warnings against the jury relying on this evidence, but if the jury had convicted, the Court of Appeal could almost certainly question whether (a) the decision to admit the evidence was correct: (b) whether the warnings to the jury were in sufficiently clear terms: and (c) whether the conviction was nevertheless a safe one. In short, a conviction might in theory have been open: in reality there would have been none, and the prosecution would almost certainly have failed to persuade the court to admit the evidence in the first place, and any conviction would be regarded as unsafe. PS v Germany (2001) 36 EHRR 1139 65. This case involved an absent, identified witness. The applicant was convicted of a sexual offence against an 8 year old girl, section The applicant was her private music teacher. Her father reported to the police that the applicant had abused her during a music lesson. S and her mother were questioned at the police station. S confirmed her fathers allegation. Her mother stated that S had been very disturbed after her music lesson and that she had later confided in her mother, presumably that she had been assaulted. At trial a request on the applicants behalf for a psychological expert opinion regarding the credibility of Ss complaints was rejected. The court believed that it was not reasonable to hear the evidence from the complainant herself, on the basis that her recollection had been repressed and if she were reminded of it, or required to remember it, her personal development would be seriously impaired. 66. The Regional Court dismissed an appeal against conviction. The applicants guilt was established on the basis of the statements made by the complainants mother and the police officer as well as a psychological expert opinion on Ss credibility which was prepared for the appeal process. There was medical evidence before the Regional Court confirming the likely deterioration of Ss health if she gave evidence of the assault. 67. Following the alleged sexual assault, S and her mother were questioned at a police station. The parents of S provided statements to the police as to her condition and state immediately following the assault, but did not allow her to testify at trial on account of the distress that it would cause her to recount the events in court. The trial court refused the applicants request to appoint an expert to determine the credibility of Ss statements, holding that its own professional experience in evaluating statements made by children was sufficient. The trial court also noted that if S were to be examined as a witness, rather than contributing to a further clarification of the facts, it would, by contrast, seriously impair her personal development. 68. The ECtHR concluded that a conviction based on this evidence involved such limitations on the rights of the defence that the trial was unfair. No counterbalancing measures could be taken to address the limitations on the rights of the defence, and the decision of the District Court to refuse to hear the oral testimony of the child or to appoint the expert requested by the defence were rather vague and speculative. There was, accordingly, a violation of article 6(1) and (3)(d). Domestic Position 69. This conviction of a sexual offence against a child was based on the hearsay evidence of her mother, a police officer, and a psychological expert, who all reported what the child had said. There was no evidence to suggest that the child could not have been called, subject to special protective measures, as a prosecution witness. Therefore, apart from the mothers evidence of her daughters condition on her return home after the music lesson, none of the material on which this conviction was based would be admitted. The childs accounts to the police and her mother and the expert were hearsay. The evidence of the expert about the childs credibility would also have been inadmissible; in effect such evidence would usurp the responsibility of the jury. Visser v The Netherlands (Application No 26668/95), 14 February 2002 70. This case involved a conviction for kidnapping, based to a decisive extent on the evidence of an anonymous witness who was not called to give evidence on the basis of his/her fear of reprisals from the applicants co accused. Six years after the offence was committed, as the case progressed through the system, the anonymous witness was questioned before an investigatory judge, and his counsel was given a limited opportunity to provide questions for the judge to put to the witness. 71. The ECtHR found, para 47, that the investigatory judge did not show how he assessed the reasonableness of the personal fear of the witness either as this had existed when the witness was heard by police or when s/he was heard by the investigating judge nearly six years later. Moreover an examination into the seriousness and well foundedness of the reasons for the anonymity of the witness when it decided to use the statement before the investigating judge in evidence was not carried out. 72. The ECtHR did not appear to object to the use of anonymous witnesses per se; rather it was the case that, at para 48, In these circumstances the Court is not satisfied that the interest of the witness in remaining anonymous could justify limiting the rights of the defence to the extent that they were limited (emphasis added). In short, for this evidence to be admitted the judge would have had to make a Domestic Position 73. See paragraph 13: the evidence of any absent anonymous witness would not be admissible. The evidence of a witness who gives oral testimony at trial may be given anonymously. Before such evidence can be admitted at all, a robust analysis of the need for his or her anonymity is required by the Criminal Evidence (Witness Anonymity) Act 2008. The prosecutor must, unless the court directs otherwise, inform the court of the identity of the witness (section 3(2)). The court must be satisfied that the measures proposed are necessary: that if adopted they would be consistent with the defendant receiving a fair trial: and that without an anonymity order, the witness would not testify (section 4). The court must examine the credibility of the witness, and whether and if so how it could be properly tested without disclosure of his or her identity (section 5). Thereafter, even with the use of special measures, such as screening, the defence would be enabled to challenge the evidence. 74. reasoned finding that the necessary conditions were satisfied. 75. It is highly unlikely that a domestic court would find that the necessary conditions were satisfied, but in any event in accordance with the reasoning of the ECtHR, if a proper examination of the facts or a reasoned decision about whether to admit this evidence were lacking, the conviction would be unsafe. Birutis and others v Lithuania (Application Nos 47698/99 and 48115/99), 28 March 2002 76. This case involves the use of anonymous, absent witnesses resulting in the conviction of three applicants, A, B, and C, for taking part in a prison riot. The evidence against A and B included testimony given by other co accused, circumstantial evidence, in addition to the statements of a variety of anonymous witnesses, believed to be fellow inmates at the prison. The Regional Court referred to the statements of 17 and 19 anonymous witnesses when convicting A and B respectively. When convicting C, the Regional Court referred solely to the statements by six anonymous witnesses recorded by the prosecution during the pre trial investigation. 77. The ECtHR noted that anonymous evidence may be appropriate in some cases, especially in the instant cases, where prisoners may fear testifying against fellow detainees. However, it noted, at para 30, that this circumstance, as such, could not justify any choice of means by the authorities in handling the anonymous evidence. At para 31 the ECtHR noted that applicant C was convicted solely on the basis of anonymous evidence; although he had been permitted to question three other witnesses in open court during the trial, the domestic courts did not base his conviction on any evidence given by those witnesses. 78. The Court noted that the convictions of applicants A and B were not based solely, or to a decisive extent, on the anonymous evidence but that because there were a high number of anonymous statements, the trial court effectively demonstrated that the statements in question were among the grounds upon which the first and second applicants conviction was based (para 32). As such, the Court looked for counterbalancing measures to offset the handicap suffered by the defence; it did not find adequate measures. 79. The Court noted at paragraphs 33 and 34 that A and B had alleged that there were inconsistencies in the anonymous statements. There was a basis to suspect the authorities had collaborated with the makers of the statements to implicate the applicants; this was evidenced by the fact that the witnesses who did testify at trial sought to retract their original statements implicating the applicants, claiming they had been made under pressure from the prison authorities. In fact, the trial courts held that their original testimony was more reliable, and discarded the revised testimony. Despite these genuine concerns as to the credibility of the anonymous witnesses, A and B were not permitted to question them. The domestic courts did not avail themselves of their statutory power to question the witnesses. In addition, there was no scrutiny by the courts of the decision to grant anonymity. As such, the handicaps on the first and second applicants defence rights were not counterbalanced by the procedures followed by the domestic judicial authorities There was a breach of article 6. Domestic Position 80. The prosecution case against some defendants depended exclusively on anonymous hearsay evidence, and against others, largely of anonymous hearsay, that is anonymous absent witnesses. See paragraph 13: the evidence would not be admissible. 81. Assuming that any individual witness were available to be called at trial, an application for his anonymity would have required the process identified in paragraph 73 (above) to be engaged. It was essential that the defendant should have the opportunity of challenging this evidence, not least because, by definition, they would almost certainly (as prisoners, unless individuals of good previous character on remand) have had previous criminal convictions, which the defendant might have wished to explore before the jury. Assuming that this case had proceeded before the jury on the basis of the process before the regional court in Lithuania, even if the judge had admitted any of this evidence, he would have been required to give the jury a most solemn warning about the dangers of relying on evidence which the defendant could not test, and assuming that the jury disregarded his warnings, the overwhelming likelihood is that without any further evidence (and as far as we can see there was none which the jury could have relied on) the convictions would be unsafe. Sadak and others v Turkey (2003) 36 EHRR 431 82. The applicants were former Turkish parliamentarians convicted of membership of an armed gang, on account of their involvement in the Peoples Democratic Party, which the domestic courts held to be separatist activity linked to a paramilitary campaign for the creation of a separate Kurdish state (para 17). Legal argument took place as to the classification of their offences under terrorism or treason provisions; different charges were brought in the course of the proceedings. The applicants were acquitted of treason charges, which attracted the death penalty. 83. At trial, the prosecution had refused to call some witnesses on account of their fear of sectarian violence; others were not requested by the applicants at trial. The case therefore involved known, absent witnesses. Argument before the ECtHR addressed, inter alia, whether the absence of those witnesses breached article 6(3)(d). 84. The ECtHR noted that in some circumstances, the judicial authorities may find it necessary to use statements obtained at the preparatory investigation stageprovided the accused has had an adequate and sufficient opportunity to challenge the statements at the time they were made or at a later date However, the Court stated that the domestic court gave a determining weight to certain statements made by witnesses which the applicants were not able to examine or challenge. Domestic Position 85. Assuming that it was established that the witnesses were fearful of giving evidence within the context of section 116(2)(e) of the 2003 Act, the additional admissibility criteria in section 116(4) would have to be addressed. The application to adduce this evidence would fail, first, because there had been no adequate investigation into the reasons why the witnesses attendance at court to give oral testimony, if necessary using special measures available for fearful witnesses, was justified, and, second, because the admission of this evidence, given the difficulty faced by the defendant seeking to challenge it, would be likely to produce an unfair trial. Krasniki v Czech Republic (Application No 51277/99), 28 February 2006 86. This case concerns anonymous witnesses, one present and one absent from trial. The applicant was convicted of drugs offences. During the pre trial judicial investigation, two anonymous witnesses, both of whom were drug users, were questioned. The applicants lawyer was permitted to ask questions relating to, amongst other matters, why the witnesses sought anonymity. In reply they stated they were in fear of reprisals for speaking to the authorities, and one of them owed money for drugs. One of the anonymous witnesses testified at trial, but, because the other could not be located, her testimony was read to the court. The testimony alleged that drugs had been purchased from the applicant. 87. Before the ECtHR, the applicant argued that the need for anonymity had not been tested properly and the authorities should have made greater efforts to assess the witnesses fear of reprisals. The applicant also challenged the prosecutions failure to disclose the criminal record of one of the anonymous witnesses who was, it emerged, being held in the same prison as the applicant. He also highlighted discrepancies between some aspects of the testimony of the witnesses that should have led to the prosecution assessing the witnesses credibility in further depth. 88. The Court held that there had been a breach of article 6(1) and (3)(d), and noted, at para 81, that the authorities had attempted to approach the anonymous testimony with some caution, but that it was not clear how the investigating officer and the trial judge assessed the reasonableness of the personal fear of the witnesses in relation to the applicant. The conclusion at para 83 was that, the Court is not satisfied that the interest of the witnesses in remaining anonymous could justify limiting the rights of the applicant to such an extent Domestic Position 89. See paragraph 13: the evidence of an anonymous absent witness would not be admissible. 90. In any event, so far as the witness who gave oral evidence, but anonymously, no proper foundation for his anonymity was established. The strict conditions in the 2008 Act were not met: his evidence, too, would therefore not have been admitted. Taxquet v Belgium (Application No 926/05), 13 January 2009 91. This case concerns an absent, anonymous witness. The applicant was convicted of being a principal party to the 1991 murder and attempted murder of a Belgian government minister and his partner respectively. An anonymous informant, whose identity was known only to the police, provided detailed information implicating several of the 8 people who would be the co defendants in the case. Only one aspect of the information implicated the applicant. 92. At trial before the Assize Court, the applicant unsuccessfully applied for an investigating judge to question the original anonymous witness. In refusing the request, the Assize Court held that the information had no probative value as such. In the present case it simply constituted information capable of giving fresh impetus or a new slant to the investigation and leading to the independent gathering of lawful evidence. The Assize Court also stated that the court was unaware of the identity of the witness in any event and regardless of the grounds [for maintaining anonymity] relied upon by the investigating authorities it does not appear useful for establishing the truth and would delay the proceedings needlessly (para 12). 93. Before the Chamber, the applicant complained that his article 6 rights had been breached in relation to: (i) the inadequate reasoning given by the jury; and (ii) the reliance on anonymous witnesses. It appears that this is the first reported instance at Strasbourg of the sole or decisive test being linked to the extent to which the jury are obliged to give reasons for their conclusions. In holding that the applicants article 6 rights were breached, the Chamber appears to have considered the issues being interrelated. It may be helpful to quote the summary of the applicants position in full, taken from para 55, testimony The applicant contended that the question of the anonymous witness took on particular significance in his case as it was linked to the preceding complaint concerning the lack of reasoning in the Assize Courts judgment. In order to be able to find that a witness statement had played a decisive role in a persons conviction, it was necessary to know the reasons for the decision, but in the present case none had been given. If the reasoning had been known, it might have been possible to identify the information received anonymously as having been a decisive factor, or the sole factor, in establishing his guilt. 94. The ECtHR did not rule out the use of anonymous statements per se, rather, it stipulated the process by which the informants anonymity should be granted. No such process was followed in the instant case. At para 64 the Court stated, anonymous statements should be examined by a judge who knows of the identity of the witness, has verified the reasons for granting anonymity and is able to express an opinion on the witnesss credibility in order to establish whether there is any animosity between the witness and the accused. (Emphasis added). In relation to whether the evidence of the anonymous informant was sole or 95. decisive, the Court stated that the Government had not produced anything to show that the finding of the applicants guilt was based on other real evidence, on inferences drawn from the examination of other witnesses or on other undisputed facts (para 66). It concluded that the applicants misgivings in relation to the use of the anonymous witness were justified, and accordingly, there was a violation of article 6(1) and (3)(d) of the Convention. Domestic Position 96. See paragraph 13: the statement of an absent anonymous witness would not be admissible. Even if present, anonymity is only permitted under strict conditions and subject to countervailing safeguards for the defendant. In any event, on the basis of this evidence, this case would not have proceeded to trial. Any conviction would have been unsafe. LORD BROWN add a few paragraphs of my own. I am in full agreement with the judgment of Lord Phillips. I wish, however, to These appeals are of the utmost importance. If the Strasbourg case law does indeed establish an inflexible, unqualified principle that any conviction based solely or decisively on evidence adduced from an absent or anonymous witness is necessarily to be condemned as unfair and set aside as contrary to articles 6(1) and 6(3)(d) of the Convention, then the whole domestic scheme for ensuring fair trials the scheme now enshrined (as to hearsay evidence) in the Criminal Justice Act 2003 and (as to anonymous evidence) in the Criminal Evidence (Witness Anonymity) Act 2008 cannot stand and many guilty defendants will have to go free. It is difficult to suppose that the Strasbourg Court has in fact laid down so absolute a principle as this and, indeed, one exception to it, at least, appears to be acknowledged: the fairness of admitting hearsay evidence from a witness absent as a result of the defendants own intimidation. But if this is recognised (and, as others have pointed out, this exception itself involves difficulties of proof) why not recognise other exceptions too provided only and always that the procedures honour the ultimate imperative of a fair trial? That, after all, is the overarching principle for which the great bulk of Strasbourg jurisprudence on article 6 stands. Given, moreover, the recognition of even one exception, what justification can there be for an otherwise absolute principle? It cannot then be said to be mandated simply by the language of article 6(3)(d). Nor, indeed, do I understand the Strasbourg Court ever to have suggested this. Nor can Strasbourg readily be supposed to have intended the sort of practical problems and anomalies identified by the Court of Appeal (paragraphs 61 63 and 68 71) that must inevitably flow from any absolute principle of the kind here contended for. Obviously, the more crucial the evidence is to the proof of guilt, the more scrupulous must the Court be to ensure that it can be fairly adduced and is likely to be reliable. In this connection there can be no harm in using the concept of sole or decisive so long as it is used broadly as it is in the 2008 Act with regard to anonymous witnesses and, indeed, in the control order context where it relates rather to the allegations made against the suspect than the evidence adduced in support. Understood and applied inflexibly, however, the concept would involve insoluble problems of detailed interpretation and application. The better view may therefore be that no such absolute principle emerges from the Strasbourg Courts judgment in Al Khawaja and Tahery v United Kingdom (2009) 49 EHRR 1. In this event the stuffing falls out of these appeals and they must fail: the domestic legislation on hearsay evidence was faithfully followed in the courts below; there was nothing unfair about admitting the relevant statements and the convictions can be seen to be perfectly safe. I recognise, however, the distinct possibility that the Strasbourg Court in Al Khawaja really did intend to lay down an absolute principle along the lines here contended for and it may be, indeed, that the outcome of that very case itself tends to support such a view. In this event the question then arises: what should this Court do? Should we accept and apply this absolute principle with the inevitable result that these appeals must be allowed or should we instead decline to follow the Strasbourg decision in Al Khawaja and in effect join with the United Kingdom Government in inviting the Grand Chamber to overrule it (the Grand Chamber panel having adjourned the UKs request for such a reference until the pronouncement of our decision on these appeals)? I have not the least doubt that the latter course is to be preferred. This case seems to me a very far cry from Secretary of State for the Home Department v AF (No 3) [2009] 3 WLR 74 where the House of Lords was faced with a definitive judgment of the Grand Chamber in A v United Kingdom (2009) 49 EHRR 625 on the very point at issue and where each member of the Committee felt no alternative but to apply it. Lord Rodger put it most succinctly (at para 98): Argentoratum locutum, iudicium finitum Strasbourg has spoken, the case is closed. Moreover not merely was the Strasbourg ruling in A clear and authoritative but, whatever view individual members of the Committee may have taken about it (and it is evident that, whilst many agreed with it, others did not), it expressed an entirely coherent view. The contrasts with the present situation are striking. In the first place, we are faced here not with a Grand Chamber decision but rather with the possible need for one. Moreover, not merely is the Courts ruling in Al Khawaja not as authoritative as a Grand Chamber decision, but it is altogether less clear than was the decision in A. Indeed, as I have already suggested, it is far from certain that Al Khawaja stands for any absolute principle of the sort here contended for. I would reject the appellants argument that not merely is the Courts judgment in Al Khawaja clear but, unlike the position in A, it is supported by a whole stream of consistent earlier Strasbourg case law and consequently more, rather than less, authoritative than the ruling in A. For the reasons fully elaborated by the Court of Appeal and now by Lord Phillips, I cannot accept that the earlier cases support, still less compel, an absolute principle such as Al Khawaja is now said to stand for. Accordingly, in agreement both with Lord Phillips and with the judgment of the Court of Appeal, I too would dismiss these appeals and express the hope that the Grand Chamber will clarify the law upon hearsay evidence and recognise that our domestic legislation is compatible with article 6.

The appellants were convicted of serious criminal offences after trials in which the victims of the offences did not give evidence: in one case because he had since died and in the other because she had run away in fear when the trial was about to commence. In each case a statement from the victim was admitted pursuant to s 116 Criminal Justice Act 2003 and placed before the jury. The appellants complained that their convictions were based solely or to a decisive extent on the statement of a witness whom they had had no chance to cross examine. This had infringed their right to a fair trial guaranteed by articles 6(1) and 6(3) of the European Convention on Human Rights which provide: 6(1) In the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law (3) Everyone charged with a criminal offence has the following minimum rights: (d) To examine or have examined witnesses against him and to obtain the attendance and examination of The Court of Appeal had dismissed the appellants appeals against conviction, holding that the test of fairness laid down by the European Court of Human Rights in Al Khawaja and Tahery v United Kingdom (2009) 49 EHRR 1 was not determinative of the results in these appeals. The United Kingdom had requested that this decision be referred to the Grand Chamber of the Strasbourg Court. On 5 June 2009 the Panel of the Grand Chamber adjourned consideration of that request pending the judgement of the Supreme Court in this case. The Supreme Court unanimously dismissed the appeal. The judgment of the court was given by Lord Phillips, President. witnesses on his behalf under the same conditions as witnesses against him. The questions before the court were (i) whether the regime enacted by Parliament in relation to the admission of the evidence of an absent witness at a criminal trial will result in an unfair trial and, if not (ii) whether the case law of the European Court on Human Rights nonetheless requires the court to apply that regime in a manner contrary to the intention of Parliament. The requirement to take into account any judgment of the European Court of Human Rights found in s 2 Human Rights Act 1998 would normally result in the Supreme Court applying principles that were clearly established by the Strasbourg court. There would however be rare occasions where the court had concerns as to whether a decision of the Strasbourg court sufficiently appreciated or accommodated particular aspects of the UK trial process. In such circumstances it was open to the Supreme Court to decline to follow the Strasbourg decision, giving reasons for adopting this course. This was likely to give the Strasbourg Court the opportunity to reconsider the particular aspect of the decision that was in issue, so that there took place what might prove to be a valuable dialogue between the courts [para 11]. The conclusions of the Court of Appeal were correct and the judgement of the Supreme Court should be read as complementary to that of the Court of Appeal and not as a substitute for it [para 13]. The Supreme Court held that the appellants trials were fair notwithstanding the decision in Al Khawaja for the following reasons: (i) The common law hearsay rule addressed the aspect of a fair trial covered by article 6(3)(d). Parliament had enacted exceptions to the hearsay rule in a regime which contained safeguards that rendered the sole or decisive rule unnecessary. (ii) The Strasbourg Court had recognised that exceptions to article 6(3)(d) were required in the interests of justice but the jurisprudence on the exceptions lacked clarity and had introduced a sole or decisive rule without discussion of the principle underlying it or full consideration of whether it was justified to impose it equally on common law and continental jurisdictions (iii) The sole or decisive rule would create severe practical difficulties if applied to English criminal procedure. In almost all cases English law would reach the same result without it. Al Khawaja did not establish that it was necessary to apply the rule in this jurisdiction. Judgments

longest

The Scottish Parliament was established by section 1 of the Scotland Act 1998. It was opened on 1 July 1999. Section 29(1) of the Act provides: An Act of the Scottish Parliament is not law so far as any provision of the Act is outside the legislative competence of the Parliament. This provision lies at the heart of the scheme of devolution to which the Act gives effect. Section 29 has to be read together with Schedule 4 which protects certain enactments from modification, and then with section 30 and Schedule 5 which defines reserved matters. These are matters reserved to the UK Parliament, and which are therefore excluded from the legislative competence of the Scottish Parliament. The area of competence that is identified by this group of provisions forms the basis for a series of sections that are designed to ensure that the Scottish Parliament confines itself to the defined areas of competence: section 31 (scrutiny of Bills before introduction), section 32 (the responsibility of the Presiding Officer), section 33 (reference of Bills to the Judicial Committee now the UK Supreme Court for scrutiny), section 35 (the power of the Secretary of State to intervene in certain cases) and sections 98 to 103 and Schedule 6 (post enactment adjudication of issues about legislative competence by the courts). The White Paper, Scotlands Parliament, Cm 3658 (1997), para 4.3, contrasted this scheme of devolution with that which had been laid down by the Scotland Act 1978, which was repealed because less than 40 per cent of the persons entitled to vote in the referendum which was required by section 85 of that Act voted in favour of it. Under that Act legislative competence was to be transferred to the Scottish Assembly in specifically defined particular groups, further defined by reference to a long list of existing statutes. That scheme, which would have required frequent updating by the UK Parliament, was seen to be incompatible with the aim that the White Paper expressed of ensuring maximum clarity and stability. While the scheme in the 1998 Act may not strike one as a model of clarity, it does appear so far to have achieved the aim of stability. Of course, harmony between the governments at Westminster and Holyrood until the May 2007 elections to the Scottish Parliament contributed to this process, as did frequent use of legislative consent motions (also known as Sewel motions, named after Lord Sewel, Parliamentary Under Secretary of State for Scotland during the passage of the Scotland Act 1998) passed by the Scottish Parliament agreeing that the UK Parliament might pass legislation on a devolved issue extending to Scotland. But it is a remarkable fact that the myriad of devolution issues that have come before the courts for determination since May 1999 have been devoted almost exclusively to the exercise of functions in criminal cases by the Lord Advocate. Logan v Harrower [2008] HCJAC 61, 2008 SLT 1049 was the first case that brought the extent of the legislative competence of the Scottish Parliament under judicial scrutiny on grounds other than compliance with Convention rights. As in the case of the appeals that are now before this court, it arose of out of a prosecution for contraventions of section 103(1)(b) of the Road Traffic Act 1988. There was no appeal against the appeal courts determination to the Judicial Committee. The question whether an Act of the Scottish Parliament is within the legislative competence of the Parliament is a devolution issue: Schedule 6, para 1(a). So it is for the courts to decide whether an Act which is challenged is within or outside competence. But the judicial function in this regard has been carefully structured. It is not for the judges to say whether legislation on any particular issue is better made by the Scottish Parliament at Holyrood or by the UK Parliament at Westminster. How that issue is to be determined has already been addressed by the legislators. It must be decided according to particular rules that the Scotland Act 1998 has laid down. But those rules, just like any other rules, have to be interpreted. That is the courts function. It is for the court to say what the rules mean and how, in a case such as this, they must be applied in order to resolve the issue whether the measure in question was within competence. These proceedings Section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provide that the offence of driving while disqualified under section 103(1)(b) of the Road Traffic Act 1988 may be prosecuted in Scotland either summarily or on indictment. As originally enacted, the maximum punishment for that offence if prosecuted summarily in Scotland was six months or the statutory maximum fine or both. If it was prosecuted on indictment in Scotland the maximum sentence was twelve months or a fine or both. By section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007, the provisions of which I shall examine in more detail later, the Scottish Parliament increased to twelve months the maximum sentence that might be imposed for this offence under the 1998 Act by the sheriff sitting summarily. That section came into force on 10 December 2007: the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Commencement No 2 and Transitional Provisions and Savings) Order 2007 (SSI 2007/479). Sean Martin was charged on summary complaint at Oban with a co accused named Rodney Cuthill. The complaint contained fourteen charges, of which charges 1, 2, 8 and 9 were directed against Martin. In charges 1 and 8 it was alleged that he drove a motor vehicle on a road while disqualified, contrary to section 103(1)(b) of the Road Traffic Act 1988, and that he committed those offences while on bail. On 14 December 2007 he pled guilty to charges 1 and 8 and to the other two charges. On 17 December 2007 he was sentenced to 12 months imprisonment on charges 1 and 8, of which four months was attributed to the fact that he committed the offences while on bail. On 12 March 2008 he presented a Bill of Suspension to the High Court of Justiciary in which he sought suspension of the sentence of imprisonment on the ground that the relevant provisions of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 were beyond the legislative competence of the Scottish Parliament. On 28 March 2008 he was granted interim liberation pending the determination of his Bill of Suspension. Ross Miller was charged on summary complaint at Stirling. The complaint contained three charges. In charge 1 it was alleged that he drove a motor vehicle on a road while disqualified, contrary to section 103(1)(b) of the Road Traffic Act 1988. On 24 April 2008 he pled guilty to charge 1 and to one of the other charges and was remanded in custody. On 14 May 2008 he was sentenced to seven months imprisonment on charge 1, back dated to 24 April 2008. On 20 June 2008 he presented a Bill of Suspension to the High Court of Justiciary in which he sought suspension of the sentence of imprisonment on the same grounds as Martin. He applied for interim liberation, but on 3 July 2008 he withdrew that application. Unlike Martin, he has now served his sentence. The two Bills of Suspension came before the appeal court for a hearing on 6 January 2009. Devolution minutes identifying the devolution issue in these proceedings had also been lodged. The court saw no reason for distinguishing these cases from its previous decision in Logan v Harrower, in which it held that the increase in the sentencing power of the sheriff sitting summarily by section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 was within the legislative competence of the Scottish Parliament. As nothing had been said to suggest that that decision was wrong, it refused to pass the Bills. It also refused the devolution minutes. On 30 January and 24 February 2009 respectively it granted the appellants leave to appeal to this court. As this narrative shows, the only reasoned decision on this issue by the appeal court is to be found in Logan v Harrower. In para 24 of that case, Lord Nimmo Smith, delivering the opinion of the court, said: We agree with the advocate depute that, in the present case, the purpose of the provision is to make Scots criminal law with regard to penalties, procedure and jurisdiction in the sheriff court apply consistently to both common law offences and statutory offences. As provided by para 3 in part I of Schedule 4 to the Scotland Act, the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to the Road Traffic Offenders Act 1988 are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin; and the modifications do not have a greater effect upon reserved matters than is necessary to give effect to the purpose of the provision in section 45. The legislative competence rules The scheme of devolution of legislative power which the Scotland Act 1998 sets out recognises that it was not possible, if a workable system was to be created, for reserved and devolved areas to be divided into precisely defined, watertight compartments. Some degree of overlap was inevitable, for the reasons explained by Lord Rodger in his discussion of the division of responsibility on matters of policy; see paras [73] and [74]. This is a familiar phenomenon in the case of federal systems such as those in Canada and Australia, where legislative competence is divided between the Dominion and the Provinces or the Commonwealth and the States. In Prafulla Kumar Mukherjee v Bank of Commerce Ltd, Khulna (1947) LR 74 Indian Appeals 23 the Judicial Committee rejected the argument that the principles which obtain in Canada and Australia had no application in India. Lord Porter gave this explanation at p 42: It is not possible to make so clean a cut between the powers of various legislatures: they are bound to overlap from time to time. The rule that was evolved by the Judicial Committee was to examine the statute that was impugned to ascertain its pith and substance, or its true nature and character, to determine whether it was legislation with respect to matters that were in the prohibited or permitted sphere. The phrase pith and substance was first used by Lord Watson in Union Colliery Co of British Columbia Ltd v Bryden [1899] AC 580, 587. The phrase true nature and character was first used in Russell v The Queen (1882) 7 App Cas 829, 839 840. The principles that these phrases embody are sometimes referred to, by a word that went out of fashion in mediaeval times, as the respection doctrine. In Prafulla Kumar Mukherjee v Bank of Commerce Ltd, Khulna having referred to the rule and found that it applied to Indian as well as Dominion legislation, Lord Porter went on to say this at p 43: No doubt experience of past difficulties has made the provisions of the Indian Act more exact in some particulars . But the overlapping of subject matter is not avoided by substituting three lists for two, or even by arranging for a hierarchy of jurisdictions. Subjects must still overlap, and where they do the question must be asked what in pith and substance is the effect of the enactment of which complaint is made, and in what list is its true nature and character to be found. If these questions could not be asked, much beneficent legislation would be stifled at birth, and many of the subjects entrusted to provincial legislation could never effectively be dealt with. The same point had already been made by Lord Atkin in Gallagher v Lynn [1937] AC 863, which was an appeal from Northern Ireland. Section 4 of the Government of Ireland Act 1920 provided that the Parliament of Northern Ireland had power to make laws for the peace, order and good government of Northern Ireland, but not to make laws in respect of, among other things, trade with any place out of Northern Ireland. He held that an Act regulating the supply of milk in Northern Ireland which imposed controls on every person who within Northern Ireland sold or exposed for sale milk, whether produced within or without the territory of Northern Ireland, was a law for the peace, order and good government of Northern Ireland in respect of precautions taken to secured the health of its inhabitants, not a law in respect of trade. At p 870, explaining what was meant by the pith and substance doctrine, he said: If, on the view of the statute as a whole, you find that the substance of the legislation is within the express powers, then it is not invalidated if incidentally it affects matters which are outside the authorized field. The legislation must not under the guise of dealing with one matter in fact encroach upon the forbidden field. Nor are you to look only at the object of the legislator. An Act may have a perfectly lawful object, eg to promote the health of the inhabitants, but may seek to achieve that object by invalid methods, eg a direct prohibition of any trade with a foreign country. The rule that was evolved and applied in these cases, among others, provides the background to the scheme that is now to be found in the Scotland Act. It was referred to at the committee stage in the House of Lords by Lord Sewel: Hansard HL Debates (21 July 1998), vol 592, col 818 et seq. The scheme seeks to give effect to the rule. Lord Sewel, recognising that a degree of trespass into reserved areas was inevitable, said that it was intended that any argument as to whether a provision in an Act of the Scottish Parliament relates to a reserved matter must be decided by reference to its pith and substance or its purpose and if its purpose is a devolved one it is not to be outside legislative competence merely because it affects a reserved matter: col 819. The question whether that aim has been achieved must be determined by examining the provisions of the Scotland Act in which the scheme is laid out. While the phrase pith and substance was used while these provisions were being debated, it does not appear in any of them. The idea has informed the statutory language, and the rules to which the court must give effect are those laid down by the statute. As to what they mean, the Scotland Act provides its own dictionary. Section 29, which must now be quoted in full, provides as follows: (1) An Act of the Scottish Parliament is not law so far as any provision of the Act is outside the legislative competence of the Parliament. (2) A provision is outside that competence so far as any of the following paragraphs apply (a) it would form part of the law of a country or territory other than Scotland, or confer or remove functions exercisable otherwise than in or as regards Scotland, (b) it relates to reserved matters, (c) it is in breach of the restrictions in Schedule 4, (d) it is incompatible with any of the Convention rights or with Community law, (e) it would remove the Lord Advocate from his position as head of the systems of criminal prosecution and investigation of deaths in Scotland. (3) For the purposes of this section, the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter is to be determined, subject to subsection (4), by reference to the purpose of the provision, having regard (among other things) to its effect in all the circumstances. (4) A provision which (a) would otherwise not relate to reserved matters, but (b) makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. The paragraphs of section 29(2) that require to be examined in this case are paras (b) and (c). The first question is whether section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 relates to a reserved matter. Reserved matters are the matters reserved to Westminster by section 30(1) of the Scotland Act, which gives effect to the list of matters in Schedule 5. Para 1 of Part II of Schedule 5 provides that the matters to which any of the sections in the Part apply are reserved matters for the purposes of the Act. Head E Transport lists among the subject matter of section E1, which applies to Road Transport, the following: (d) the Road Traffic Act 1988 and the Road Traffic Offenders Act 1988. Section 45 of the 2007 Act does not refer expressly to any of the provisions of the Road Traffic Act 1988 or the Road Traffic Offenders Act 1988. But, as it applies to offences under enactments passed before the 2007 Act generally, it must be taken to refer to them by implication. Their subject matter is a reserved matter. The question whether a provision relates to a reserved matter in terms of section 29(2)(b) is to be determined by reference to the purpose of the provision, applying the rule set out in section 29(3). This rule lays down the primary test of what is meant by purpose. But it is necessary to have regard also to section 29(4) which deals with a special category of overlap between reserved matters and matters which are not reserved that is in point in this case. This is because section 126(5) of the Scotland Act provides that references in the Act to Scots criminal law include criminal offences, jurisdiction, evidence, procedure and penalties and the treatment of offenders, and because section 45 of the 2007 Act deals with what the head note to Part 3 of that Act refers to as penalties. The list of reserved matters has been drawn up by reference to different aspects of executive or governmental responsibility. But the spheres of activity embraced by Scots private law and Scots criminal law, which are not reserved, do not respect those boundaries. They extend across all of them. The regulation of both devolved matters and reserved matters within Scotland is likely to involve questions of Scots private law and Scots criminal law. Section 29(4) does not apply if, applying the test laid down by section 29(2), the provision in question has already been found otherwise to relate to a reserved matter. That is the effect of para (a) of this subsection. It does apply, however, if it makes modifications of Scots private law or Scots criminal law as it applies to reserved matters: para (b). Here too the boundary between what is reserved and what is not reserved is to be determined by applying a purpose test. The key word here is consistently. If the purpose is to make the relevant rule of Scots criminal law apply consistently to reserved matters and otherwise, it will pass the test. The provision will not then fall to be treated as relating to a reserved matter, and thus outside the legislative competence, because it is caught by section 29(2)(b). The question whether the provision is in breach of any of the restrictions in Schedule 4 must also be addressed in this case. The paragraphs in that Schedule that need to be considered are paras 2 and 3, which so far as relevant provide as follows: 2 (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent to that the rule in question is special to a reserved matter 3 (1) Paragraph 2 does not apply to modifications which (a) are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and (b) do not have a greater effect on reserved matters than is necessary to give effect to the purpose of the provision. (2) In determining for the purposes of sub paragraph (1)(b) what is necessary to give effect to the purpose of a provision, any power to make laws other than the power of the Parliament is to be disregarded. There is obviously some duplication between section 29 and the provisions of this Schedule. At first sight, paragraph 2(1) declares what the reader already knows, having studied section 29(4). But, in contrast to section 29(4) which deals with the question whether a provision relates to a reserved matter, para 2(1) refers to the law on reserved matters. The meaning of this expression is set out in para 2(2)(a). The starting point is that the law on reserved matters as a whole is protected from modification by the Scottish Parliament. This appears to withdraw the protection that is given by section 29(4) to modifications of a rule of Scots private law or Scots criminal law as it applies to reserved matters whose purpose was to make the law apply consistently to reserved matters and otherwise. But paragraph 2(1) is itself qualified by the opening words of paragraph 2(3). The words is special to a reserved matter are the key words in this subparagraph. The contrast which they suggest is between a rule of Scots criminal law which is special to a reserved matter on the one hand and one which is general in its application on the other because it extends to both reserved matters and matters which have not been reserved. There is a strong family likeness between the two tests, as Lord Walker says: see para [54]. But a modification which survives the test in section 29(4) will have to pass the tests in Schedule 4: section 29(2)(c). If it passes the test in paragraph 2(3), paragraph 2(1) will not apply. It will have no need of the protection that is given by paragraph 3 to modifications that fall within the scope of that paragraph. This analysis shows that the questions which lie at the heart of this case are: (1) whether the purpose of section 45 was to make a modification to Scots criminal law as defined in section 126(5); (2) if so, whether its purpose was to make the law apply consistently to reserved matters and otherwise; and (3) if it passes those tests, whether the rule that it sought to modify was special to a reserved matter within the meaning of paragraph 2(3) of Schedule 4. Section 45 of the 2007 Act Section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 is one of a group of sections dealing with sentencing powers which appear in Part 3 of the Act under the heading Penalties. Two sections require to be noticed in addition to section 45. First there is section 43, which deals with common law offences. It amends section 5 of the Criminal Procedure (Scotland) Act 1995, which deals with the sheriffs summary jurisdiction and powers, in two respects: in section 5(2)(d), the power to impose imprisonment is raised from any period not exceeding three months to twelve; and section 5(3) is repealed. Secondly, there is section 44, which increases the maximum sentence of imprisonment for a list of particular summary only statutory offences which had attracted a maximum sentence in excess of the previous common law maximum but were below the new maximum of twelve months for offences dealt with summarily. Section 45 is headed Other statutory offences. It is not necessary for the purposes of this case to quote it in full. The provisions that are relevant provide as follows: (1) The maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence is, by virtue of this subsection, 12 months. (2) Accordingly, the specification of a maximum period of imprisonment in every relevant penalty provision is, in relation to any relevant offence to which it applies, to be read subject to subsection (1). (3) Without prejudice to subsections (1) and (2), the Scottish Ministers may by order amend the specification of a maximum term of imprisonment in a relevant penalty provision so as to specify, in relation to the relevant offence to which it applies, that the maximum term of imprisonment to which a person is liable on summary conviction is 12 months. (6) In this section, a relevant offence is an offence under a relevant enactment or instrument which is (a) triable either on indictment or summary complaint, and (b) punishable on summary conviction with a maximum term of imprisonment of less than 12 months. (7) In this section a relevant enactment is an Act passed before this Act It is common ground that the Road Traffic Offenders Act 1988 is a relevant enactment and that a contravention of section 103(1)(b) of the Road Traffic Act 1988 is a relevant offence for the purposes of this section. What was the purpose of section 45? Section 29(3) of the Scotland Act provides that, when consideration is being given to the purpose of the provision, regard is to be had to its effect in all the circumstances. One of the circumstances to which it is proper to have regard is the situation before the provision was enacted, which it was designed to address. Reports to and papers issued by the Scottish Ministers prior to the introduction of the Bill, explanatory notes to the Bill, the policy memorandum that accompanied it and statements by Ministers during the proceedings in the Scottish Parliament may all be taken into account in this assessment. The sentencing powers of the sheriff, sitting as a court of summary jurisdiction, are regulated by statute. Section 7(5) of the Criminal Procedure (Scotland) Act 1995 provides that a stipendiary magistrate shall have the summary criminal jurisdiction and powers of a sheriff. Prior to the commencement of the Criminal Proceedings etc (Reform) (Scotland) Act 2007, section 5(2) of the 1995 Act provided inter alia as follows: The sheriff shall, without prejudice to any other or wider powers conferred by statute, have power on convicting any person of a common law offence . (d) to impose imprisonment, for any period not exceeding three months. Section 5(3) of the 1995 Act provided that the maximum sentence for a second or subsequent offence involving violence or dishonesty was six months. The effect of these provisions was that the power of the sheriff or stipendiary magistrate to impose a sentence of imprisonment was limited to a maximum of three months in the case of common law crimes (except in the case of certain types of repeat offences) and, in the case of statutory offences, to the maximum laid down by the relevant statute. In the case of a contravention of section 103(1)(b) of the Road Traffic Act 1988, section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provided that the maximum if the offence was prosecuted summarily in Scotland was six months. In November 2001 the Minister of Justice appointed a committee under Sheriff Principal John McInnes QC to review the provision of summary justice in Scotland, including the structures and procedures of the sheriff courts and the district courts as they related to summary business and the inter relation between the two levels of court, and to make recommendations for the more efficient and effective delivery of summary justice in Scotland. In the report which it presented to Ministers in January 2004 the Summary Justice Review Committee identified a need to relieve pressure on the higher courts. This implied a need to move cases from the High Court of Justiciary to the sheriff and jury court, and in turn a need to move cases from the sheriff and jury court to summary procedure. In para 7.87 of its report it recommended that, to equip summary judges with the disposals that would be necessary to deal with cases that would be heard summarily in the future, the criminal jurisdiction of judges sitting summarily should be increased to a maximum of twelve months detention or imprisonment or a 20,000 fine. Having consulted on this recommendation among other proposals, the Scottish Ministers decided to accept it. In March 2005 the Minister for Justice published Smarter Justice, Safer Communities Summary Justice Reform Next Steps (Scottish Executive, March 2005). In para 4.10 reference was made to the recommendations that the Committee had made which were designed to promote case handling at a more appropriate level: Recognising the pressures on the solemn system, the Committee recommended that the sentencing powers of a sheriff sitting without a jury should be raised to one year in custody or a fine of 20,000, enabling the transfer of the least serious solemn business to the summary courts In para 4.50 it was stated that it was proposed to implement the reports recommendations in relation to the custodial sentencing powers of sheriffs sitting summarily. The Criminal Proceedings etc (Reform) (Scotland) Bill was introduced into the Scottish Parliament in February 2006. In para 186 of the explanatory notes to the Bill it was said of section 35 (which became section 45 when the Bill was passed) that it brought the maximum summary prison sentences for certain statutory offences into line with the new maximum sentence for common law offences set out in what is now section 43 of the Act. In the Policy Memorandum which accompanied the Bill it was stated in para 6 that the Bill made provision in eight main policy areas, including: increases in the criminal sentencing powers of the summary courts, ensuring that those courts can deal with an appropriate range of cases in terms of both severity and caseload, and do so more quickly than is currently the case. In para 206 it was stated that the Executive believed that professional sheriffs should be able to deal with a wider range of cases under summary procedure than they were currently entitled to, including some that would attract a higher penalty. The theme that is apparent from these earlier documents was picked up by the Justice 1 Committee in its report on the general principles of the Bill: Justice 1, 10th Report 2006, Stage 1 Report on Criminal Proceedings etc (Reform) (Scotland) Bill, 5th July 2006. In para 293 of its report the Committee said that one of the principal drivers for the reforms proposed by the Bill was that justice should be dispensed at the appropriate level and that this meant, among other things, the granting of significantly increased sentencing powers to sheriffs sitting without a jury. In para 294 it said that it broadly accepted that there was merit in some cases being dealt with at lower levels of the judicial system than was the case at present. Introducing the stage 1 debate in the Parliament on 14 September 2006, the Minister for Justice said that the Bill made a number of changes to the detailed law of criminal procedure, that each of these changes played its part in speeding up the system as a whole, that the Bill would ensure that increased sentencing powers for sheriffs would ease the pressure on the higher courts and that the bill was to be regarded as part of the executives wider work to reform the summary justice system: Scottish Parliament Official Report, cols 27664 6. In my opinion this material shows conclusively that the purpose of section 45 of the 2007 Act was to contribute to the reform of the summary justice system by reducing pressure on the higher courts. An increase in the sentencing powers of sheriffs when they were dealing with statutory offences was seen as a necessary of this process. The jurisdiction of the sheriff sitting summarily is defined by reference to the penalties that the sheriff can impose. These are pre eminently matters of Scots criminal law: see section 126(5). As it was to a rule of Scots criminal law that the provision was directed, I would hold that it does not relate to a reserved matter within the meaning of section 29(2)(b). Was it to make the law apply consistently? Section 45 of the 2007 Act forms part of a group of sections, all directed to a reform or modification of the sentencing powers of the sheriff sitting summarily. The leading provision is section 43, which increased the maximum sentence for common law offences from three (or, in the case of some repeat offences, six) months to twelve months. It is obvious however that to have left the matter there would have led to an imbalance in the system between how common law offences were to be dealt with on the one hand and how statutory offences were to be dealt with on the other. The reform that this would have achieved would have been incomplete and confusing. To achieve its object it had to be extended across the board to statutory offences as well. To draw a line between statutory offences relating to reserved matters and those relating to matters that were not reserved would have been even more confusing. When they were dealing with an offence created by a United Kingdom statute, prosecutors and sheriffs would have had to check in each case whether they were on the right side of the line. Statutory offences of all kind form a large part of the diet of the summary courts. To achieve a complete and worthwhile reform of the summary justice system a modification of the sentencing power across the whole range of statutory offences was required. In my opinion the purpose of the modification in section 45 must be taken to have been to make the law relating to the increased sentencing power of the sheriff sitting summarily apply consistently to reserved matters and otherwise. I would hold that section 45 is not to be treated as relating to a reserved matter under section 29(4). Is the rule special to a reserved matter? The question that must now be addressed is that set out in para 2(3) of Schedule 4: is the rule of Scots criminal law that the Act seeks to modify special to a reserved matter? To answer it, one must first identify the rule of Scots criminal law that is being modified. Then one must ask whether that rule is special to a reserved matter. Identifying the rule is a crucial step towards reaching the right answer to the question whether the modification that is proposed is within the competence of the Scottish Parliament or must be dealt with at Westminster. I agree with Lord Rodger that, unlike section 29(3) and (4), para 2 of the Schedule concentrates on the rule of law that is being modified by the enactment and makes no mention of the purpose of the modification: see para [122]. But the purpose of the enactment may nevertheless be referred to in order to identify the rule of law that is being modified. I think that it is clear that any modification of the maximum punishment that can be imposed for the offences that the road traffic legislation has created must be held to be a matter for the United Kingdom Parliament at Westminster. The rule of Scots law as to the maximum term of imprisonment that can be imposed would fall to be treated as a rule that was special to a reserved matter. So would any other limits on the extent of the penalties or as to the scope of offences that the Road Traffic legislation lays down. The Calman Report, Serving Scotland Better: Scotland and the United Kingdom in the 21st Century, June 2009, considered in paras 5.167 181 certain aspects of road traffic regulation including drink driving limits and speed limits. As the authors of the report were right to recognise, under the current legislation any alteration to those limits that might be thought to be acceptable in Scotland would not be within the legislative competence of the Scottish Parliament. Some concern was expressed during the progress of the Bill as to whether this reform might lead to what was referred to as sentence drift a tendency on the part of sheriffs to impose higher sentences for these offences than they would previously have regarded as appropriate. But it is plain that this was not what the reform was intended to do, and there is no evidence that this has in fact happened. So I do not think that it would right to say that the purpose of section 45 was to achieve an overall increase in the sentences that sheriffs were imposing. Had that been the purpose, it would have gone some way to identifying the rule of law that was being modified. As it is, the rule cannot be identified by that route. Section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provide that the maximum sentence of imprisonment for the offence under section 103(1)(b) of the Road Traffic Act 1988 if prosecuted summarily in Scotland is six months and that it is twelve months if prosecuted in Scotland on indictment. They contain, in effect, two rules of Scots criminal law. One is a rule as to the overall maximum sentence, which is twelve months imprisonment. That, plainly, is a rule which is special to the Road Traffic Acts and it is a reserved matter. The other is a rule about Scots criminal jurisdiction and procedure, which is not reserved. It is that rule which determines the procedure under which the maximum sentence can be imposed. The purpose of the modification that section 45 makes is to enable more statutory offences to be prosecuted summarily. The maximum sentence of imprisonment for the offence if prosecuted in Scotland remains twelve months. The modification relates to the procedure which determines whether the sheriff has jurisdiction to impose the maximum sentence. It extends the power that is given to him when he is sitting summarily. It seems to me therefore that the rule of Scots law that is being modified is the rule of procedure, not the rule of Scots law as to the maximum sentence for the offence. The rule of procedure is a rule that applies generally to the way cases are dealt with in the sheriff court. It is not special to the Road Traffic Offenders Act 1988. The purpose of para 2(3) of Schedule 4 to the 1998 Act, as I understand it, is to avoid the fragmentation of rules of Scots criminal law which are of general application into some parts which are within the Scottish Parliaments competence and some parts which are not. It is, of course, the case that the difference between the maximum sentence that could be imposed by a sheriff sitting summarily and that which could be imposed by him in solemn proceedings was prescribed in Schedule 2 to the Road Traffic Offenders Act 1988. But in doing so the Schedule was basing itself on a distinction between two forms of Scots criminal procedure which apply generally. I think that it was within the competence of the Scottish Parliament to extend its general reform of that procedure to the forms of procedure referred in this and other statutes that deal with reserved matters, otherwise fragmentation would occur. I am not confident that it helps to reason by way of examples. Each case must be taken on its own merits. In case of doubt, the words to the extent only suggest that a generous application of para 2(3) which favours competence is to be preferred, as opposed to one which applies it narrowly. And the key to the decision in this case lies in identifying the rule in question, which is achieved by examining the purpose of the provision which is under scrutiny. One could, of course, say that Schedule 2 contains two maximum sentences, one for summary proceedings and the other for proceedings on indictment, and that as both are reserved matters it was not open to the Scottish Parliament to alter either of them. But that, in my opinion, would be to carry the process of analysis too far. The word special indicates that, in cases such as this where the decision depends on the exercise of judgment, the purpose of the provision may be the best guide. So, in agreement with Lord Walker and Lord Brown and respectful disagreement with Lord Rodger and Lord Kerr, I would hold that section 45 was not directed to a rule which was special to a reserved matter within the meaning of para 2(3) of Schedule 4, that para 2(1) of the Schedule does not apply, that it survives scrutiny under section 29(2)(c) and there is no need to refer to para 3. Had it been necessary to refer to para 3, I would have held that section 45 of the 2007 Act was not saved by it. On this point I disagree with the appeal court in Logan v Harrower. A decision as to the procedure under which a sentence of more than six months could be imposed was not a modification of an incidental or consequential nature. It was an important change in the procedure which one would expect to see set out in the body of the enactment, not in a schedule of the kind that generally deals with matters that are merely incidental or consequential on provisions found elsewhere in the enactment. Section 104 of the Scotland Act enables Her Majesty in Council or a Minister of the Crown, with the consent of both Houses of the United Kingdom Parliament, to make such provision as is considered necessary or expedient in consequence of any provision made by or under any Act of the Scottish Parliament. As the explanatory notes to that section point out, the power to make provision consequential on legislation under paragraph 3 of Schedule 4 is very limited. Among other things, it does not enable the Scottish Parliament to legislate otherwise than as a matter of Scots law. It does not have power under that provision to make any consequential provisions that require to take effect elsewhere in the United Kingdom. Examples of the use that is made of the power under section 104 are to be found in the Adults with Incapacity (Scotland) Act 2000 (Consequential Modifications) (England, Wales and Northern Ireland) Order 2005 (SI 2005/1790) and the Police, Public Order and Criminal Justice (Scotland) Act 2006 (Consequential Provisions and Modifications) Order 2007 (SI 2007/1098). There are many others. Lord Rodger in para [81] has mentioned some of them. The use of section 104 is not confined to cross border matters. The power was used in connection with the reforms introduced by the 2007 Act to make the powers to impose sanctions under the Road Traffic Offenders Act 1988 available in the justice of the peace courts that were to be established under the 2007 Act, and to make the same powers available in the district courts during the phased introduction of the justice of the peace courts: see the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007 (SI 2007/3480). I agree with Lord Rodger that the scheme for adjusting the sheriffs summary criminal jurisdiction in relation to statutory offences could have been dealt with in this way, had this been thought to be necessary. But the modification that was required in their case was to a procedural route that was already available for dealing with these offences in the sheriff court. For the reasons that I have given I consider that the judgment that was made that the modification was within the legislative competence of the Scottish Parliament was correct, and that the use of the section 104 power was not necessary. Conclusion The result of this analysis is that section 45 of the 2007 Act survives scrutiny. Endorsing what the appeal court decided in Logan v Harrower but differing from it as to the reason why the section is not in breach of the restrictions in Schedule 4, I would hold that the provision is within the legislative competence of the Scottish Parliament. I would therefore dismiss these appeals. Bearing in mind that the appellant Martin who is on interim liberation has not yet served the sentence that the sheriff imposed on him, I would remit both cases to the appeal court for any further orders that may be required. Had I been in favour of allowing the appeals I would have made an order under section 102(2)(a) of the 1998 Act removing the retrospective effect of the decision that, so far as it purports to modify the penalty provision for a contravention of section 103(1)(b) of the Road Traffic Act 1988 in Part I of Schedule 2 to the Road Traffic Offenders Act 1988, section 45(2) of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 is outside the competence of the Scottish Parliament. I would also have made an order under section 103(2)(b) suspending its effect for two months to allow the defect to be corrected as it seems to me that, in a case of this kind, these two orders go hand in hand. LORD WALKER The Scotland Act 1998 is on any view a monumental piece of constitutional legislation. Parliament established the Scottish Parliament and the Scottish Executive and undertook the challenging task of defining the legislative competence of the Scottish Parliament, while itself continuing as the sovereign legislature of the United Kingdom. That task is different from defining the division of legislative power between one federal legislature and several provincial or state legislatures (as in Canada or Australia, whose constitutional difficulties the Judicial Committee of the Privy Council used to wrestle with, often to the dissatisfaction of those dominions). The doctrine of pith and substance mentioned by Lord Hope in his judgment is probably more apt to apply to the construction of constitutions of that type. But both have to face the difficulty of defining (necessarily in fairly general and abstract terms) permitted or prohibited areas of legislative activity. The difficulties (viewed from the perspective of Northern Ireland) are discussed in Harry Calverts Constitutional Law in Northern Ireland, which, though written as long ago as 1968, still provides a very helpful commentary. It shows how different forms of words have come to be recognised as indicating a more or less proximate (or direct, or crucial) connection between a proposed enactment and an area of legislative activity. Calvert quotes (from an unidentified source), at pp 180 181, the argument of the Attorney General for Northern Ireland when Lynn v Gallagher [1937] AC 863 was before the House of Lords: The crux of this whole legislation lies in three words, the words in respect of used in section 4(1) of the Government of Ireland Act, 1920. These three words are the apt words to indicate the true subject matter of an enactment but they are not, we submit, the apt words to indicate merely the results of an enactment. They are possibly rather stronger than a word such as concerning, and than the phrase in relation to, but they certainly must have a different meaning, unless they may be construed contrary to the general use of language, from the word affecting. In the British North America Act the words used are in relation to and these words in respect of do not occur in it. We submit that these words in respect of are no weaker than the words there used. Calvert also quotes, at p 179, Higgins J in McArthur Ltd v Queensland (1920) 28 CLR 530, 565: We have to determine in each case what is the subject of the legislation what subject is the Act with respect to what it effects not what things or operations it may indirectly affect. These background matters must have been in the mind of those who undertook the drafting of the Scotland Act (and in particular the provisions directly relevant to these appeals). But in the Scotland Act Parliament has gone further, and has used more finely modulated language, in trying to explain its legislative purpose as regards reserved matters. The Court has to consider two groups of provisions, each of which has a particular nexus with reserved matters as defined in Schedule 5 of the Act. The first group of provisions consists of section 29(2)(b) as explained and qualified by subsections (3) and (4). The second group consists of section 29(2)(c) and Schedule 4, paras 2 and 3. All these provisions are set out in Lord Hopes judgment (paras 16 and 20) and I need not repeat them. But it is worth considering the manner in which reserved matters are defined in Schedule 5 (to which both groups of provisions are linked). Schedule 5, Part I, contains general reservations: the constitution, political parties, foreign affairs, public service, defence and treason. Part II then contains specific reservations under eleven heads (themselves elaborately subdivided and made subject to exceptions). Although termed specific, some of these are expressed in general terms. For instance, Head A1, Fiscal, economic and monetary policy, is as follows: Fiscal, economic and monetary policy, including the issue and circulation of money, taxes and excise duties, government borrowing and lending, control over United Kingdom public expenditure, the exchange rate and the Bank of England. Exception Local taxes to fund local authority expenditure (for example, council tax and non domestic rates). Many of the specific reservations in Part II are expressed as the subject matter of a particular statute (or part of a statute). For example Head E.1, Road Transport, includes The subject matter of . (d) the Road Traffic Act 1988 and the Road Traffic Offenders Act 1988 (subject to an exception for a few sections of the Road Traffic Act 1988). The use of the expression subject matter has been described (in an unsigned editorial in (1998) 19 Statute Law Review v) as an elegant drafting device but as having potential difficulties. So I come back to the first group of provisions, consisting of subsection (2)(b) of section 29 as explained and qualified by subsections (3) and (4). Its structure appears reasonably straightforward. Section 29(2)(b) prohibits legislation by the Scottish Parliament which relates to reserved matters. That is an expression which is familiar in this sort of context, indicating more than a loose or consequential connection, and the language of section 29(3), referring to a provisions purpose and effect, reinforces that. Section 29(4) adds to the reach of section 29(2) (as is clear from section 29(4)(a)) as regards modifications of Scots private law, or Scots criminal law, as it applies to reserved matters. Scots private law and Scots criminal law are widely defined in section 126 (4) and (5). Paragraph 29(4)s default position is restrictive: the modification is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. Here the law in question must mean the relevant rule of Scots private law or Scots criminal law. The second group of provisions consists of section 29(2)(c) and Schedule 4, paras 2 and 3. Para 2(1) contains a general prohibition on modification (including amendment or repeal) of the law on reserved matters, that composite expression being defined in sub paragraph (2) by reference to the subject matter of an enactment or non statutory rule. So reading Schedule 4, para 2(1) and (2) together with Schedule 5, Part II, Head E1(d), we see that (if those provisions stood alone) an Act of the Scottish Parliament could not modify the Road Traffic Offenders Act 1988, because the subject matter of that Act is a reserved matter. As I understand it the Court is agreed (although not for identical reasons) that the legislation now in point, section 45 of the Criminal Proceedings etc (Reform)(Scotland) Act 2007, does not infringe section 29(2)(b) of the Scotland Act. The Court is however divided as to the effect of section 29(2)(c). Lord Rodger and Lord Kerr take the view that section 45 of the 2007 Act infringes section 29(2)(c) and Schedule 4, para 2 (being special to a reserved matter for the purposes of para 2(3) and not being saved by para 3, relating to incidental or consequential modifications). I agree that para 3 is not in point. The crucial provision is para 2(3). But it is important, in my view, to try and see it as part of a rational and coherent scheme defining the legislative competence of the Scottish Parliament. That is easier said than done, as the division within the Court indicates. When I first studied this second group of provisions I got the impression that they replicated, but in different language, the effect of what I have called the first group of provisions, and that it was hard to discern the legislative scheme or purpose underlying this. I still have difficulty with this. But I think the answer may be that section 29(2) is dealing comprehensively with the scope of any new legislation enacted by the Scottish Parliament, whereas Schedule 4 is (as its heading indicates) concerned with the protection of some existing legislation (or some non statutory rule of law) which has a reserved matter as its subject matter. However the statute book is already so heavily burdened that almost any new legislation is likely to modify existing legislation, and in Scotland a lot of new legislation will have the effect of modifying Scots private law or Scots criminal law. So in most cases both groups of provisions will be in point. Section 29(4) is concerned with a provision which makes a modification to Scots private law or Scots criminal law as it applies to reserved matters; in that case it is necessary to enquire whether its purpose is to make the law in question apply consistently to reserved matters and otherwise (that is, to non reserved matters). Schedule 4, para 2(3) is concerned with the modification of a rule of Scots private law or Scots criminal law to the extent that the rule in question is special to a reserved matter. There is to my mind an obvious degree of affinity between these two enactments, in that a provision intended to produce consistency in a rules application across the board (that is, to reserved matters and non reserved matters alike) is unlikely to apply to a rule which is special to a reserved matter. Special is to be contrasted with general and a measure intended to produce consistency across the board is general by its very nature. The two statutory tests are not identical (if Parliament had intended them to be identical it would no doubt have used the same words in each). Nevertheless they have a strong family likeness, and it would be rather surprising if a provision came within the legislative competence of the Scottish Parliament under section 29(4) but failed on the test in Schedule 4, paragraph 2(3). In applying each test it is necessary to identify the rule of Scots criminal law which is to be modified. It is to be found in sections 9 and 33 of, and Schedule 2 to, the Road Traffic Offenders Act 1988, so far as they apply to an either way offence under section 103(1)(b) of the Road Traffic Act 1988 committed in Scotland. These provisions are part of Scots criminal law, and they relate (almost by definition, having regard to the wording of Head E1(d)) to a reserved matter. It is also necessary to identify the purpose of the provision which makes the modification, that is section 45 of the 2007 Act. Its purpose was (as Lord Hope says in his judgment, para [31]) to contribute to the reform of the summary justice system by reducing pressure on the higher courts. An increase in the sentencing powers of sheriffs when they were dealing with statutory offences was seen as a necessary of this process. Similarly in Lord Rodgers view (para [105]) it was to introduce a novel, general, provision for determining the maximum term which a sheriff, sitting as a court of summary jurisdiction, could impose by way of imprisonment in respect of either way statutory offences which had previously attracted a maximum sentence of less than 12 months imprisonment. Lord Rodger gives a very similar explanation of the purpose of section 45 in para [113] of his judgment. In my opinion this statutory purpose includes achieving consistency in the sheriffs sentencing powers, on summary conviction, as between reserved and non reserved matters. Lord Rodger accepts this in para [116] of his judgment, but reaches a different conclusion on the similar point (not, I accept, exactly the same point) arising under Schedule 4, paragraph 2(3). I would accept that on my interpretation both section 29(4) and Schedule 4, para 2(3) may produce some difficult borderline cases, and some results which might appear anomalous. Perhaps they would do so on any interpretation, since in the Scotland Act Parliament was attempting to define legislative competence across the whole broad expanse of what are now regarded as the concerns of government. But (with great respect to the contrary views of Lord Rodger and Lord Kerr) I do not see this as a difficult borderline case. The relevant rule of Scots criminal law to be modified is not that driving while disqualified is a criminal offence, nor that it is a criminal offence punishable by imprisonment, nor that the maximum term of imprisonment is 12 months. All that has been enacted by the Westminster Parliament, and is left untouched. The rule to be modified is whether (and if so to what degree) the option of summary trial before the sheriff should reduce the maximum sentence that can be passed. That is to my mind a general matter relating to the Scottish system of criminal justice, and is not something special to the reserved matter of road transport. For these reasons, and for the fuller reasons in the judgment of Lord Hope, while respecting the closely argued contrary views of the minority, I agree with Lord Hope and Lord Brown that the appeals should be dismissed and the cases remitted to the Appeal Court for any further orders that may be required. LORD BROWN Section 33 of and Part 1 of Schedule 2 to the Road Traffic Offenders Act 1988 (the RTOA), as originally enacted, provided that the offence of driving while disqualified (the offence) under section 103(1)(b) of the Road Traffic Act 1988 (the RTA) could be prosecuted in Scotland either summarily or on indictment; if summarily, the maximum punishment was six months imprisonment (and/or a fine); if on indictment, twelve months (and/or a fine). The RTOA and the RTA are reserved matters. By section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (the 2007 Act) the Scottish Parliament purported to increase from six months to twelve months the maximum sentence that could be imposed for the offence by the sheriff sitting summarily. (Although immaterial to this appeal, it may be noted that in England and Wales the offence was, and remains, triable summarily only and subject to a maximum sentence of six months imprisonment.) The sole issue for determination on this devolution appeal is whether section 45 of the 2007 Act was within the Scottish Parliaments legislative competence within the meaning of section 29 of the Scotland Act 1998 (the 1998 Act). Section 29 has already been set out in full by other members of the Court and I need not repeat it. So too the relevant paragraphs of Schedule 4 to the 1998 Act (referred to in section 29(2)(c)). Before coming to the single point on which the Court is divided it is worth noting the following basic matters. First, that section 45 of the 2007 Act, the enactment impugned, did not increase the maximum penalty available for the offence in Scotland: that remained at twelve months imprisonment; what changed was that the sheriff could impose this maximum sentence no less when sitting as a court of summary jurisdiction than as a court of solemn jurisdiction. Secondly, that the essential purpose of section 45 (indeed, of sections 43 to 49 of the 2007 Act as a whole) was not to increase the penalties imposed by the Scottish courts but rather, by enlarging the sheriffs summary sentencing powers, to reallocate business within the court system to have more cases tried summarily instead of by a jury, summary trials generally being simpler, faster and cheaper than jury trials. Thirdly, that had the 2007 Act, directed as it was to reallocating court business in this way and to standardising the sheriffs summary sentencing powers for the future, not included within its provisions modification of the RTOA and the RTA in the way described, it would have created a striking contrast between the sheriffs summary powers when dealing with reserved matters and those available to him in other cases. Of course, as Lord Rodger points out, any such anomaly or inconsistency could if necessary be cured by resort to section 104 of the 1998 Act. But was that the only lawful means of achieving the desired consistency in this case? That is the question. I understand all of us to agree that section 45 does not fall foul of section 29(2)(b) of the 1998 Act. It does not relate to a reserved matter having regard to section 29(3) and is not to be deemed to relate to reserved matters by virtue of section 29(4). On this latter point, in common with Lord Hope, I regard section 45 as making modifications of Scots criminal law as it applies to reserved matters but as doing so for the purpose of making Scots criminal law (as to the allocation of court business) apply consistently. What critically divides the Court is the question raised under section 29(2)(c): as to whether section 45 is in breach of the restrictions in Schedule 4. I do not pretend to find paragraphs 2 and 3 of Schedule 4 entirely easy to follow and naturally I recognise the force of Lord Rodgers reasoning. For my part, however, I remain unpersuaded that section 45 modifies the law on reserved matters within the meaning of paragraph 2(1), given that (by virtue of paragraph 2(3)) paragraph 2(1) applies in relation to a rule of Scots criminal law only to the extent that the rule is special to a reserved matter (which I do not regard the unamended 6 months limits of the sheriffs summary jurisdiction to be). Even, however, were I persuaded that section 45 is to be regarded as modifying the law on reserved matters within the meaning of paragraph 2, I would conclude here that paragraph 2 is then disapplied by paragraph 3 since such modification is to be seen merely as incidental to a provision being made (for reallocation of court business and the standardisation of the sheriffs summary sentencing powers) in relation to unreserved matters and has no greater effect on reserved matters than is necessary to give effect to such purpose. Given that the Scottish Parliament is plainly intended to regulate the Scottish legal system I am disinclined to find a construction of Schedule 4 which would require the Scottish Parliament, when modifying that system, to invoke Westminsters help to do no more than dot the is and cross the ts of the necessary consequences. I too, therefore, would dismiss these appeals. LORD RODGER Does an enactment of the Scottish Parliament relate to reserved matters? Does it modify a rule of Scots criminal law that is special to a reserved matter? These are the key questions in the present appeals. The answers depend on the interpretation of section 29(2)(b) and (c) of the Scotland Act 1998 (the 1998 Act), along with paras 2 and 3 of Part I of Schedule 4 to the Act. Viewed in isolation, para 2, in particular, can appear to use impenetrable language to erect an arbitrary restriction on the Parliaments powers. Matters become clearer, however, when the provisions are seen in their setting in life. A useful starting point is the situation before 1999. Policy responsibility before devolution Until devolution took effect, leaving aside the fluctuating position of Northern Ireland, the central government of the United Kingdom was carried on by a single executive and a single Parliament. The executive was responsible for, and could determine, all areas of policy for the entire United Kingdom. Similarly, Parliament could legislate to give effect to the chosen policy in all parts of the United Kingdom. In practice, Parliament did not always insist on the law being uniform throughout the United Kingdom. To take only the most obvious example, Parliament did not intervene to impose uniformity on the private or criminal laws of England and Scotland. Instead, when legislation was to apply in both jurisdictions, where necessary, it included provisions that were tailored to fit the underlying law of both systems. So, for instance, the Rehabilitation of Offenders Act 1974 had to take account of differences in the two systems of criminal procedure. Sometimes, even if Parliament was legislating for England and Wales only, for example, the legislation could not be effective unless some provisions were made to extend to Scotland and vice versa. To take another obvious example, aspects of the legislation on detained patients in the Mental Health Act 1983 and the Mental Health (Scotland) Act 1984 had a cross border dimension and would have been unworkable if various provisions of the English Act had not extended to Scotland and various provisions of the Scottish Act had not extended to England. When the legislation was being prepared, officials and, if necessary, ministers in the various departments, including the Scottish Office, would discuss the proposals and try to iron out any difficulties. Even where there was no particular cross border dimension, legislation proposed by one department might have an impact on matters for which another department was responsible. Proposed legislation on, say, education might have an impact on employment; legislation on care in the community might raise law and order questions; legislation on transport might affect the environment; legislation on planning might affect trade and industry. And so on. More particularly, to be effective, legislation on a matter for which one department had responsibility might require that a piece of legislation falling within another departments sphere of responsibility should be amended. So, when a policy was being worked up and incorporated into a Bill, while one department would take the lead, very frequently officials and ministers from a number of departments would be involved. Suppose, for instance, the Home Office and the Scottish Office had proposed legislation to adjust the jurisdiction of the courts by increasing the sentencing powers of summary courts in both England and Wales and in Scotland. Suppose also that, in order to be effective, the reforming legislation would have had to modify the penalty provisions for offences in various Acts, such as the Road Traffic Offenders Act 1988 (the RTOA). In that event, officials of the lead departments would have consulted officials and ministers from all the departments, including the Department of Transport, having responsibility for the Acts which it was proposed should be modified. Sometimes the impact of the proposed legislation on a different area would be relatively insignificant perhaps involving little more than updating statutory references or bringing the language of existing legislation into conformity with the language of the proposed legislation. In such cases the main task of the other departments might well be to help the lead department and the Bill team by identifying provisions that would require to be modified in this way. But sometimes the impact would be more significant and would trench on issues of policy. Then there could well be differences of opinion among the departments concerned as to the best way forward. If officials could not resolve them, the disputed issues could be taken for decision to the appropriate cabinet committee and ultimately, if necessary, to the full cabinet or to the Prime Minister. The result would be a Bill which made all the necessary amendments, whatever the subject matter of the legislation being amended and irrespective of the department which had responsibility for that subject. Policy responsibility after devolution In the 1998 Act and the corresponding Acts for Wales and Northern Ireland, Parliament devolved legislative and executive authority in varying degrees. The powers of the Scottish Parliament are to be found in sections 28 and 29 of the 1998 Act. Section 28(1) of the 1998 Act provides that, subject to section 29, the Scottish Parliament may make laws. In terms of section 29(1), an Act of the Scottish Parliament is not law so far as any of its provisions is outside the legislative competence of the Parliament. Under section 29(2) a provision is outside that competence in various circumstances in particular, if, (b), it relates to reserved matters or, (c), it is in breach of the restrictions in Schedule 4. Leaving aside certain matters where powers are shared (section 56), it is immediately obvious that the overall scheme was to devolve power to the Scottish Executive and Scottish Parliament, but to except certain reserved matters, which are identified in Schedule 5 to the 1998 Act. All other matters are devolved matters although that term is not used since the Act concentrates on identifying the matters lying outside the competence of the Scottish Parliament and Scottish Executive. So far as these reserved matters are concerned, policy responsibility in respect of Scotland remains with the United Kingdom government and the United Kingdom Parliament retains the sole responsibility for legislating on them. The purpose of a provision and its validity It is convenient at this stage to notice that, under section 29(3) of the 1998 Act, the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter and so is outside the competence of the Parliament under section 29(2)(b) is to be determined by reference to the purpose of the provision. Sometimes the clearest indication of the purpose of a provision will be found in a report which gave rise to the legislation or in a report of one of the committees of the Parliament. But very often the purpose of a provision will be clear from its context in the Act in question. For example, the subject matter of the Carriage of Goods by Sea Act 1992 is a reserved matter: para 1 and Section E3 of Part II of Schedule 5 to the 1998 Act. Obviously, therefore, if the Scottish Parliament purported to pass a Carriage of Goods by Sea (Scotland) Act with the sole purpose of repealing the 1992 Act in Scots law, its purpose would relate to a reserved matter and so its provisions would be outside the competence of the Parliament by virtue of section 29(2)(b). In practice, such a clear example would be unlikely to get past the legal advisers to the Scottish Parliament. In real life the problem is likely to arise in more complex situations. But assume, for example, that the purpose of an Act is to increase the sentencing powers of the lower courts in Scotland so as to allow them to deal with more serious cases. The purpose of the Act plainly relates to a devolved, rather than a reserved, matter. So its provisions will not be outside the competence of the Scottish Parliament by reason of section 29(2)(b). Does it follow that all of its provisions are automatically within the competence of the Scottish Parliament? By no means. For example, any provision which was incompatible with rights under the European Convention on Human Rights or with Community law would be outside competence by reason of section 29(2)(d) even if that provision was designed to help achieve the purpose of increasing the sentencing powers of the lower courts in Scotland. Similarly, any provision which was in breach of the restrictions in Schedule 4 to the 1998 Act would be outside competence again, even though the provision was designed to help achieve the purpose of increasing the sentencing powers of the lower courts in Scotland. Quite simply, therefore, even if the purpose of an Act is within the competence of the Scottish Parliament in terms of section 29(2)(b) of the 1998 Act, the Parliament cannot achieve that purpose by enacting provisions which are beyond its competence for one of the reasons listed in the other paragraphs of that subsection. As Lord Atkin put it in Gallagher v Lynn [1937] AC 863, 870, an Act may have a perfectly lawful object but may seek to achieve that object by invalid methods. In other words, the fact that a provision may have a lawful (devolved) purpose does not validate the provision if, for some other reason, it is outside the competence of the Parliament. So, in particular, the mere fact that the purpose of a provision is to increase the sentencing powers of the sheriff, sitting as a court of summary jurisdiction, will not validate it if the provision is outside the competence of the Parliament because it purports to modify a rule of Scots criminal law that is special to a reserved matter: section 29(2)(c) of, and para 2 of Part I of Schedule 4 to, the 1998 Act. Section 104 orders The fact that the powers of the Scottish Parliament are subject to these limitations means that there is now a stark contrast between the position in England and Scotland. For England, one executive and one Parliament continue to have the necessary powers to determine policy in all subject areas and to put it into effect by legislation. For Scotland, however, the necessary powers are divided between two executives and two legislatures. Even though the legislative arrangements for Scotland have changed in this way, the nature of the problems to be tackled by legislation has not changed. So, for example, some measures, like mental health legislation, which are devolved matters, still have a cross border dimension. Similarly, proposed legislation in one field, which happens now to be devolved, may require substantial amendment to legislation in another field, which happens now to be reserved. In these situations the Scottish Parliament will not have all the powers that are needed to make a fully effective reform. So its legislation can take the matter only so far. If it is to be fully effective, the legislation passed by the Scottish Parliament will require to be topped up by legislation of the United Kingdom Parliament dealing with any aspects which are beyond its competence. The need to provide for such situations was foreseen by those who drafted the 1998 Act. Section 104, which is designed to be used when they arise, is therefore a key element of the scheme for devolution. It contains a tailor made mechanism for using the powers of the United Kingdom Parliament to supplement legislation of the Scottish Parliament, without the need for full scale legislation by Parliament: (1) Subordinate legislation may make such provision as the person making the legislation considers necessary or expedient in consequence of any provision made by or under any Act of the Scottish Parliament or made by legislation mentioned in subsection (2). (2) The legislation is subordinate legislation under an Act of Parliament made by a member of the Scottish Executive, a Scottish public authority with mixed functions or no reserved functions, or any other person (not being a Minister of the Crown) if the function of making the legislation is exercisable within devolved competence. Of course, the Scottish Parliament and Scottish Executive cannot compel a Minister of the Crown to exercise the power under section 104. The intention underlying section 104 and indeed the whole scheme of devolution is, however, that the redistribution of powers should not impair but improve the government of the United Kingdom as a whole. It proceeds on the basis that both administrations can be expected to co operate appropriately. In particular, it presupposes that the United Kingdom ministers and Parliament will not be indifferent to the effectiveness of legislation passed by the Scottish Parliament. Not surprisingly, therefore, since devolution, ministers have made more than 40 orders under section 104. Some of the section 104 orders have concerned matters with a cross border aspect. When legislating for England and Wales, Parliament can, of course, still include any provisions which require to extend to Scotland in order to make the legislation effective though, doubtless, only after discussion with the Scottish Executive and their officials. But, as already noted, it is outside the competence of the Scottish Parliament to make any provision that would form part of the law of England and Wales: section 29(1) and (2)(a) of the 1998 Act. So the Scottish Parliament cannot make any changes to English law which may be needed in order to make its legislation on the devolved matter effective. Section 104 comes to the rescue. For instance, following the enactment of the Mental Health (Care and Treatment) (Scotland) Act 2003 by the Scottish Parliament, a Scotland Office minister used his power under section 104 of the 1998 Act to make the Mental Health (Care and Treatment) (Scotland) Act 2003 (Consequential Provisions) Order 2005 (No 2078; S 9), amending the law of, inter alia, England and Wales in order to facilitate the removal of detained patients from Scotland to England or Wales. But section 104 may also be needed in cases where proposed changes in the law on one subject require changes in the law on another subject. Given the large measure of devolution in matters such as justice, education and health, many of the subjects that are likely to be affected by legislation of the Scottish Parliament will fall within the sphere of responsibility of the Scottish Executive. If the proposed amendments to existing legislation are uncontroversial, then officials can deal with them. If there are disputes on significant matters of policy between, say, the education and criminal justice directorates, it will be for the Scottish Ministers and their officials to thrash them out and incorporate the agreed policy into legislation for the consideration of the Parliament. Again, whatever the principal subject matter of an Act may be, it can be expected to include the necessary amendments to all the relevant legislation on other devolved matters. After, as before, devolution, however, legislation on a subject which is now a reserved matter is liable to have an impact on a subject which is now devolved. For example, legislation on asylum seekers (a reserved matter) might have an impact on the legislation relating to accommodation for homeless persons (a devolved matter). Given the continuing power of Parliament to legislate for Scotland (section 28(7)), there would be no difficulty in incorporating all the necessary changes into the legislation on asylum seekers presumably, after the Home Office had discussed the proposals with the Scottish Executive, just as, formerly, the Home Office would have discussed them with the Scottish Office. The converse situation is where the Scottish Executive and Parliament wish to legislate on a matter which has implications for what is now a reserved matter. If, in the days before devolution, effective legislation could often only be prepared and introduced once policy issues in a number of discrete areas had been hammered out, the position must be the same after devolution. Likewise, if different departments were the guardians of policy on different matters before devolution, the same must apply after devolution the difference being that the Scottish Ministers and their directorates are now responsible for policy on devolved matters, the United Kingdom government and its departments for policy on the other (reserved) matters. Under section 54 of the 1998 Act, the competence of Scottish ministers is, of course, modelled on the competence of the Scottish Parliament. Suppose, for instance, that the Scottish Executive wanted to introduce legislation changing the system of accommodation for homeless persons in Scotland, but the reform would involve modifying provisions in a (reserved) Act on asylum seekers. If similar legislation had been proposed by the Scottish Office before devolution, the Scottish Office and the Home Office would have discussed the relevant policy issues. Eventually, the government as a whole would have reached a view on them and this view would have been reflected in the resulting legislation if any. Obviously, after devolution, exactly the same policy issues would present themselves. By devolving power over Scottish housing policy to the Scottish Executive and the Scottish Parliament, Parliament cannot have intended to remove from the United Kingdom government the power to take all the necessary decisions on asylum matters. So, in principle, the position after devolution must remain the same as before. If the Home Office and the United Kingdom Parliament were content with the proposed changes to the legislation on asylum seekers, there would be no difficulty: they could be made by order under section 104 of the 1998 Act. One example of such an order dealing with a reserved matter is the Housing (Scotland) Act 2006 (Consequential Provisions) Order 2008 (No 1889), article 6 of which amends the list of disqualifying offices in Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975. Another example is more immediately relevant to the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (the 2007 Act) which gives rise to these appeals. The Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007 (No 3480; S 7) repeals or amends provisions of the RTOA. I return to this order briefly at para 151 below. On the other hand, if agreement could not be reached and proposed Scottish housing legislation would involve changes to legislation on asylum seekers which the United Kingdom government regarded as unacceptable, it would have to be either dropped or modified. This would not be to single out Scottish housing legislation exactly the same would apply to any similar proposal from the ministry with responsibility for housing in England. The only difference is that, for England, the dispute would have to be settled by ministers and departments within the United Kingdom government, whereas, for Scotland, it would have to be settled between a minister and department in Westminster and a minister and directorate in Edinburgh or, ultimately, between the United Kingdom government and the Scottish Executive. If, therefore, the Scottish Parliament persisted in legislating on the matter, despite the United Kingdom governments opposition, one would expect to find that the relevant provisions affecting asylum seekers would be outside its competence and so not law. By no means all encroachments by the Scottish Parliament into the territory of reserved matters are going to be dramatic or unacceptable. As already explained, legislation on a devolved matter is quite likely to entail some change in a reserved matter. Section 29(2)(c) recognises this reality. It proceeds on the basis that, even when the legislation of the Scottish Parliament does not relate to a reserved matter and so must relate to a devolved matter the legislative package, as a whole, may require to have some impact on the law on reserved matters, if it is to be effective. Section 29(2)(c) and Schedule 4 are designed to show how far, in this respect, the Scottish Parliament can go by itself. Consistently with the general structure of the Act, these provisions prescribe what modifications of the law on reserved matters lie outside the competence of the Scottish Parliament since they would truly be a matter for the consideration of the United Kingdom government and Parliament. If a proposed reform includes aspects which fall outside the competence of the Scottish Parliament in this way, that does not mean that the reform cannot go ahead: if the United Kingdom government and Parliament are content, these aspects can be addressed by an appropriate order under section 104. Incidental or consequential modifications I shall have to look at paras 2 and 3 of Part I of Schedule 4 to the 1998 Act in more detail in due course, but it is convenient to notice one aspect at this stage. As in pre devolution days, a piece of legislation on what is now a devolved matter may require essentially minor and technical modifications to the law on what are now reserved matters. Obviously, the Scottish Parliament should be able to make these modifications for itself. And para 3(1) of Part I of Schedule 4 makes it clear that it can provided that the modifications do not go further than is necessary. Referring back to the restriction imposed by para 2, para 3(1) provides: Paragraph 2 does not apply to modifications which (a) are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and (b) do not have a greater effect on reserved matters than is necessary to give effect to the purpose of the provision. The paragraph refers to modifications which are incidental to, or consequential on, provision made . which does not relate to reserved matters. The adjectives suggest the kinds of relatively minor modifications which are often to be found in schedules, rather than cluttering up the body of a traditional United Kingdom statute. The wording of a form to be used in making an application or carrying out a transaction is an example of the kind of incidental matter which is usually consigned to a schedule. As mentioned already at para 72 above, typical consequential amendments are concerned to modernise the language of an existing provision or to update legislative references. Amendments of this kind are also usually found in a schedule to an Act. Precisely because they raise no separate issue of principle, amendments of these kinds can be safely stowed away in a schedule, which is unlikely to be debated in any detail, if at all. If the legislature approves the main provisions, then it must equally approve these technical and mechanical changes which are needed to give effect to the main provisions. Similarly, it is easy to see that a modification of that kind to the law on a reserved matter, following on from legislation on a devolved matter, would be unlikely to raise any issue of principle to which the relevant United Kingdom minister or Parliament would object. So the Scottish Parliament can deal with it. That is what para 3(1) provides. In the unlikely event that a problem arose, the Secretary of State could make an order under section 35(1)(b) of the 1998 Act prohibiting the Presiding Officer from submitting the Bill for Royal Assent. With that rather lengthy introduction, I can now turn to examine the particular problem which gives rise to these appeals. The problem in these appeals Put briefly, section 45 of the 2007 Act purports to provide inter alia that a person convicted on summary complaint of a contravention of section 103(1)(b) of the Road Traffic Act 1988 (the RTA) is liable to a maximum term of imprisonment of 12 months rather than of 6 months, as originally provided in section 33 of, and Part I of Schedule 2 to, the RTOA. The effect of para 1 and Section E1 of Part II of Schedule 5 to the 1998 Act is that the RTOA is a reserved matter. So the enactment that comprises section 33 of, and Part I of Schedule 2 to, that Act is the law on a reserved matter. The appellants maintain that, to the extent that it purported to modify the maximum term of imprisonment on summary conviction laid down by the RTOA, section 45 was special to this reserved matter and so outside the competence of the Scottish Parliament by reason of section 29(2)(c) of, and para 2 of Part I of Schedule 4 to, the 1998 Act. It is therefore not law. It follows, they say, that the maximum term of imprisonment on summary conviction of a contravention of section 103(1)(b) of the RTA remains 6 months. If so, the terms of imprisonment, of over 6 months, imposed on the appellants for their respective contraventions of section 103(1)(b) of the RTA, were incompetent and the bills of suspension must be passed and the sentences quashed. The same point came before the criminal appeal court (Lord Nimmo Smith, Lord Eassie and Lord Wheatley) in Logan v Harrower 2008 SLT 1049. The court held that section 45 of the 2007 Act was within the competence of the Parliament. In the present cases the appeal court simply followed that decision and, without issuing any written judgment, refused to pass the bills of suspension. Summary jurisdiction before the 2007 Act Before looking in detail at the provisions of the 1998 Act, it is necessary to examine the position on summary jurisdiction before section 45 of the 2007 Act was brought into force on 10 December 2007. Following the enactment of the Criminal Procedure (Scotland) Act 1995 (the 1995 Act), the only provision dealing with the summary jurisdiction and powers of the sheriff to impose a sentence of imprisonment was section 5 of that Act. By section 5(1) the sheriff, sitting as a court of summary jurisdiction, was to continue to have all the jurisdiction and powers exercisable by him at the commencement of the Act. Section 5(2) then provided that, without prejudice to any other or wider powers conferred by statute, on convicting any person of a common law offence, the sheriff was to have power, (d), to impose imprisonment, for any term not exceeding 3 months. By subsection (3), in the case of a second or subsequent conviction of an offence inferring dishonest appropriation of property (or attempt) or of an offence inferring personal violence, the sheriff was to have power to impose a term of imprisonment not exceeding 6 months. Since this was the only general provision dealing with the extent of the sheriffs summary powers of imprisonment, under the 1995 Act there was no general provision of any kind in Scottish criminal procedure which prescribed the maximum term of imprisonment which a sheriff, sitting as a court of summary jurisdiction, could impose where someone was convicted of a statutory offence. The limit depended on what the legislature had provided for the particular offence. So, if you wanted, for example, to know the maximum sentence of imprisonment available on a conviction, on summary complaint, under the Knives Act 1997 you would look at sections 1(5)(a) and 2(2)(a) of that Act. Similarly, for a summary conviction of a contravention of section 103(1)(b) of the RTA, you would look in Part I of Schedule 2 to the RTOA. Often you would find that the maximum penalty on summary conviction was 3 or 6 months. But, even as long ago as 1871, section 7 of the Prevention of Crime Act permitted the sheriff to impose 12 months imprisonment on summary conviction of an offence against the Act. And, if you looked at section 25 of, and Schedule 4 to, the Misuse of Drugs Act 1971 today, you would see that the maximum sentence on summary conviction of various offences is 12 months imprisonment. In 2004 the Summary Justice Review Committee chaired by Sheriff Principal McInnes QC recommended that, in order to relieve pressure on the courts of solemn jurisdiction, the criminal jurisdiction of judges sitting summarily should be increased: they should be able to impose a maximum sentence of 12 months imprisonment or detention and a maximum fine of 20,000. The first group of sections in Part 3 of the 2007 Act (sections 43 to 49) was designed to give effect to a slightly modified version of the Committees recommendation. Sections 43 to 45 dealt with the recommendation on imprisonment for the sheriff court. Section 46 dealt with the justice of the peace court, while sections 47 and 48 were designed to increase the maximum available fine to 10,000, rather than 20,000, as contemplated by the Committee. Section 49 dealt with compensation orders. The intention behind the relevant provisions of the 2007 Act therefore was that sheriffs sitting as a court of summary jurisdiction should be able to deal with more serious contraventions of the common law and statute law not that they should impose higher sentences for the same conduct. The anticipated benefits of the reform were thought to outweigh the admitted risk that the effect of increasing the sentences which the summary courts could impose would be an undesirable upward drift in the level of sentences. The appeal court has the necessary powers to check any such tendency in an appropriate case. The reform as carried out by the 2007 Act So far as imprisonment is concerned, the reform was effected by three separate provisions. The first, section 43, dealt with the power of imprisonment for common law offences. Most common law offences, such as assault, are triable either on summary complaint or on indictment. For these cases the reform was effected simply by substituting 12 months for 3 months in section 5(2)(d) of the 1995 Act. So now the maximum penalty for all common law offences is 12 months. Section 5(3), being no longer needed, was repealed. No common law offence falls within the area of reserved matters and so no issue as to legislative competence arises. The second provision was in section 44, which deals with certain specified offences that can be tried only on summary complaint. Again, the maximum term of imprisonment is increased to 12 months. The reform was effected by amending the penalty provisions in the individual statutes creating the offences. Since none of the offences falls within the area of reserved matters, again no issue as to legislative competence arises. Section 45 completed the scheme by dealing with statutory offences which are triable either on indictment or on summary complaint (either way offences) and which are punishable on summary conviction with a maximum term of imprisonment of less than 12 months (subsection (6)). Section 45(1) and (2) provide: (1) The maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence is, by virtue of this subsection, 12 months. (2) Accordingly, the specification of a maximum period of imprisonment in every relevant penalty provision is, in relation to any relevant offence to which it applies, to be read subject to subsection (1). By section 45(2) the specification of a maximum period of imprisonment in any relevant penalty provision in any Act passed before the 2007 Act is to be read subject to section 45(1). In short, section 45 was intended to introduce a novel, general, provision for determining the maximum term which a sheriff, sitting as a court of summary jurisdiction, could impose by way of imprisonment in respect of either way statutory offences which had previously attracted a maximum sentence of less than 12 months imprisonment. In all such cases the sheriff is now to be able to impose a maximum sentence of 12 months imprisonment. In order to achieve its purpose, section 45 had to do two things. First, it had to make provision for the maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence to be 12 months. That is what subsection (1) does. But, by itself, that provision would not have worked or, at the very least, would have left the position unclear. By the very terms of subsection (6)(b), section 45 applies only to offences where the statutory maximum term of imprisonment on summary complaint has already been fixed at less than 12 months. In other words, if it is to work, section 45 must also, secondly, increase the previous maximum term of imprisonment for the offences in question when tried on summary complaint. So the new rule in section 45(1) has to be made to prevail over, and to supersede, any penalty provision providing for a lower maximum term of imprisonment on summary conviction of any either way offence in any relevant enactment. That is what subsection (2) is designed to do. The present case shows subsection (2) in action. Section 33 of the RTOA provides: (1) Where a person is convicted of an offence against a provision of the Traffic Acts specified in column 1 of Part I of Schedule 2 to this Act or regulations made under any such provision, the maximum punishment by way of fine or imprisonment which may be imposed on him is that shown in column 4 against the offence and (where appropriate) the circumstances or the mode of trial there specified. (2) Any reference in column 4 of that Part to a period of years or months is to be construed as a reference to a term of imprisonment of that duration. (6) (5) (b) Summarily, in Scotland. (c) On indictment, in Scotland. (7) (4) Punishment Disqualification Endorsement Penalty points The table below sets out the entry relating to contraventions of section 103(1)(b) of the RTA in Part I of Schedule 2 to the RTOA: (3) (2) (1) Provision General Mode of creating nature of prosecution offence offence Offences under the Road Traffic Act 1988 RTA Driving (a) Summarily, (a) 6 months Discretionary. Obligatory. 6 in England and or level 5 on section while 103(1)(b) disqualified. Wales. the standard scale or both. (b) 6 months or the statutory maximum or both. (c) 12 months or a fine or both. Taking section 33 and the table together leaving the 2007 Act on one side on a summary conviction of a contravention of section 103(1)(b) of the RTA in Scotland, the maximum punishment by way of imprisonment which may be imposed on the offender is 6 months. A contravention of section 103(1)(b) of the RTA is a relevant offence in terms of section 45(6) of the 2007 Act. Similarly, section 33 of, and Part I of Schedule 2 to, the RTOA constitute a relevant penalty provision in terms of section 45(7) of the 2007 Act. So, by virtue of section 45(2), the specification of a maximum period of imprisonment of 6 months on summary conviction in column 4 of Part I of Schedule 2 is to be read subject to section 45(1) of the 2007 Act. In other words, the relevant entry in column 4 of the Schedule is to be read subject to the requirement that the maximum term of imprisonment on summary conviction of any relevant offence (including a contravention of section 103(1)(b) of the RTA) is to be 12 months. Section 45(3) of the 2007 Act gives the Scottish Ministers power by order actually to amend the specification of a maximum term of imprisonment in a relevant penalty provision. But the Court was told that the Ministers had not exercised that power in respect of Part I of Schedule 2 to the RTOA. An order amending the figure in column 4 of the Schedule from 6 to 12 would make the position clearer for anyone consulting it. But it would not change the substance. If section 45 was within the competence of the Scottish Parliament in this regard, section 45(1) prevails over the Schedule and provides that the maximum term of imprisonment for someone convicted on summary complaint of a contravention of section 103(1)(b) of the RTA is 12 months. Therefore, even if section 45 does not technically amend the figure in column 4 of the Schedule, it certainly purports to supersede, and thereby modify, the law comprising section 33 of the RTOA and the relevant entry in the Schedule. Similarly, it purports to supersede and modify all the other comparable penalty provisions which prescribe the maximum term of imprisonment that can be imposed, on summary conviction, for either way offences in statutes dealing with reserved matters. In short, section 45 purports to modify, inter alia, the maximum term of imprisonment to which someone is liable on summary conviction of a contravention of section 103(1)(b) of the RTA by increasing it from 6 months to 12 months. The issue in the appeals is whether, in so far as it purports to make this modification of the provisions of the RTOA, section 45 of the 2007 Act is outside the competence of the Scottish Parliament in any of the ways specified in section 29(2) of the 1998 Act. In fact, the parties are agreed that the only relevant limits are those in section 29(2)(b) and (c). Therefore, the Court has to decide whether section 45 of the 2007 Act falls foul of the limits in section 29(2)(b) and (c) and para 2 of Part I of Schedule 4. It is convenient to start with section 29(2)(b). Is section 45 beyond the competence of the Scottish Parliament because it relates to a reserved matter? In para 75 above, I have given a hypothetical example of an Act of the Scottish Parliament whose purpose would obviously relate to a reserved matter. The Act would therefore be outside its competence. Sometimes, of course, the purpose of a provision may be obscure. And, even when it is not obscure, people may describe the purpose in slightly different ways. But, having regard to its background and its context, I would identify the purpose of section 45 of the 2007 Act as being to adjust the jurisdiction of the Scottish courts by making 12 months the maximum term of imprisonment to which a person is liable on summary conviction of any either way statutory offence. For the sake of brevity, I shall refer to this purpose as being to increase the sheriffs summary sentencing powers. The jurisdiction and sentencing powers of the Scottish courts are not reserved matters. So the purpose of the section can on no view be said to relate to reserved matters. This is so, even though, in order to achieve its purpose, as part of the scheme for adjusting the jurisdiction of the Scottish courts, the section does undoubtedly purport to affect reserved matters, viz, by modifying the relevant penalty provision in the RTOA and, as the advocate depute accepted, by modifying penalty provisions for either way offences in any other statutes falling within the scope of the reserved matters in Schedule 5 to the 1998 Act. An example would be the maximum term of imprisonment on summary conviction of a corrupt practice under section 168(1)(b) of the Representation of the People Act 1983. Section 29(4) of the 1998 Act has also to be considered, however, since it contemplates the possibility that a provision whose purpose does not otherwise relate to a reserved matter may nevertheless be treated as relating to a reserved matter and so fall outside the competence of the Scottish Parliament. Subsection (4) applies to a provision which makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters. So the subsection would apply only if section 45 could be said to make a modification to Scots criminal law as it applies to reserved matters. The advocate depute argued that subsection (4) did not apply to a case like the present because it was restricted to cases where the provision in question applied only to reserved matters. Although no such qualification appears in the wording, he submitted that it was implicit since, if a provision applied to both reserved and devolved matters, its purpose would, inevitably, be to make the law apply consistently to reserved matters and otherwise. I accept that, where a provision applies to both reserved and devolved matters, its effect may be to make the law apply consistently to both. But its purpose may be different. It is possible, for example, to conceive of a situation where the purpose of a provision was actually to make a modification in relation to the criminal law applying to a particular reserved matter, but the provision was made to apply, incidentally, to devolved matters. Section 29(4) must be apt to catch a case of that kind. That said, I am very doubtful whether subsection (4) applies in this case. The words of the subsection obviously cover a case where some general provision of Scots private or criminal law applies to reserved matters. For example, it would cover modifications to the general law on limitation as it applied to actions relating to some reserved matter; or modifications to, say, the general law of criminal procedure as it applied to an accuseds trial, on summary complaint or on indictment, for some offence constituting a reserved matter. In such cases the provision modifies the law applying to the reserved matter; it does not modify the reserved matter itself. But Parliament provides that, subject to the unless clause, it is none the less to be treated as relating to the reserved matter. In the present case, by contrast, section 45 actually modifies the reserved matter or, rather, the law on the reserved matter viz, the penal provision in Part I of Schedule 2 to the RTOA. In my view section 29(4) is not designed to cover a provision of this kind. Therefore, as far as section 29(2)(b) is concerned, the position is regulated by section 29(3). Even if this were considered to be too narrow a construction of section 29(4) of the 1998 Act, section 45 of the 2007 Act would still not fall to be treated as relating to the reserved matter of the RTOA. A provision which makes modifications of Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law apply consistently to reserved matters and otherwise. The phrase, the purpose of the provision, must refer to the same purpose in both subsection (3) and subsection (4). Part of the purpose of section 45 as described in para 112 above is indeed to make the law on the sheriffs power to imprison apply consistently to all either way statutory offences, whether constituting reserved matters in terms of Schedule 5 or not. So section 45 is not to be treated as relating to a reserved matter under section 29(4). In effect, the unless clause in section 29(4) allows the Scottish Parliament to make a general reform of Scottish private or criminal law, even though it modifies the law which applies to reserved matters. Again, this is not surprising since the United Kingdom Parliaments legislation on particular topics has always been framed and operated against the background of the general private and criminal law as it applies in the various jurisdictions from time to time. Equally, any reform of the general law has to take account of all the matters to which it actually applies. In agreement with all of your Lordships, I am therefore satisfied that section 45 of the 2007 Act is not outside the competence of the Scottish Parliament by reason of relating to a reserved matter. The question then arises: even though the purpose of section 45 is one that the Scottish Parliament can legitimately pursue, is the section nevertheless to some extent outside its competence because it is in breach of a restriction in para 2 of Part I of Schedule 4 to the 1998 Act? This question has to be addressed in stages. Does section 45 modify the law on a reserved matter? As already explained, under section 29(2)(c) of the 1998 Act, section 45 will be outside the competence of the Scottish Parliament so far as it breaches any of the restrictions in Schedule 4 to the 1998 Act. The relevant paragraphs for present purposes are paras 2 and 3. Paragraph 2 provides: (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent that the rule in question is special to a reserved matter or the subject matter of the rule is (a) interest on sums due in respect of taxes or excise duties and refunds of such taxes or duties, or (b) the obligations, in relation to occupational or personal pension schemes, of the trustees or managers. At first sight, para 2(1) appears to impose a very drastic limit on the competence of the Scottish Parliament: an Act of the Parliament cannot modify (which includes amending or repealing section 126(1)) the law on reserved matters. If that were all that para 2 said, then it would prevent the Scottish Parliament from ever touching legislation on reserved matters even if the purpose of the provision related to a devolved matter. In effect, it would make section 29(2)(b) superfluous. But para 2(1) is actually qualified by para 2(3) and does not apply to modifications falling within the scope of para 3. Section 29(3) and (4) focus on the provision which is being enacted and on its purpose. By contrast, para 2 of Part I of Schedule 4 focuses on the rule of law that is being modified by the enactment and makes no mention whatever of the purpose of the modification. Paragraph 2(2)(a) defines the law on reserved matters as any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament. As explained in para 95 above, the effect of para 1 and Section E1 of Part II of Schedule 5 to the 1998 Act is that the subject matter of the RTOA is a reserved matter. So the enactment comprising section 33 of, and the relevant entry in Part I of Schedule 2 to, that Act is part of the law on this reserved matter. This conclusion supports my earlier conclusion that these provisions are not provisions of Scots criminal law, as it applies to reserved matters in terms of section 29(4)(b). A provision cannot be both the law on a reserved matter and the law as it applies to the self same reserved matter. As I have already explained at para 110 above, section 45 of the 2007 Act undoubtedly purports to supersede and modify the enactment in section 33 of, and the relevant entry in Part I of Schedule 2 to, the RTOA. Therefore the power of the Scottish Parliament to enact section 45 for reserved statutes depends on whether the restriction in para 2(1) of Part I of Schedule 4 to the 1998 Act applies to the modification made by section 45. Does section 45 fall within para 3(1) of Part I of Schedule 4? In Logan v Harrower 2008 SLT 1049, 1054, at para 24, giving the opinion of the appeal court, Lord Nimmo Smith said this: While we were not fully addressed on the extent to which recourse may legitimately be had to extra statutory materials as an aid to the construction of a statutory provision such as section 45, in order to discover whether its purpose is such as to bring it within the proviso to section 29(4), it appears to us to be legitimate to have regard to the passages in the Policy Memorandum and Explanatory Notes, quoted above, which contain express statements about its purpose. From these it may be taken, as the advocate depute submitted, that the purpose and of the provision in section 45 of the 2007 Act is to increase generally the criminal sentencing powers of the sheriff, sitting as a court of summary jurisdiction, and that the provision, construed in this light, fulfils this purpose. We agree with the advocate depute that, in the present case, the purpose of the provision is to make Scots criminal law with regard to penalties, procedure and jurisdiction in the sheriff court apply consistently to both common law offences and statutory offences. As provided by paragraph 3 in Part I of Schedule 4 to the Scotland Act, the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to RTOA 1988 are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin; and the modifications do not have a greater effect upon reserved matters than is necessary to give effect to the purpose of the provision in section 45. Lord Nimmo Smith had already explained, at para 22 of the courts opinion, that the argument before the court had centred on section 29(4) of the 1998 Act. And para 23 and the first three sentences of para 24 contain the reasoning by which the court concluded that section 45 of the 2007 Act was not to be treated as relating to reserved matters by reason of section 29(4). In the final sentence of para 24 the appeal court moved on to consider whether, nevertheless, section 45 was in breach of the restriction in para 2(1) of Part I of Schedule 4 to the 1998 Act. The court held that it was not on the view that the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to the RTOA are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin. The appeal court had in mind para 3(1) of Part I of Schedule 4 which is set out in para 91 above. In other words, the court held that the modifications made by section 45 were incidental to, or consequential on, provision made which did not relate to reserved matters. So the prohibition in para 2(1) did not apply to those modifications. In my view the reasoning is unsound. I have already indicated, at paras 91 93 above, that para 3(1) appears to be intended to cover the kinds of minor modifications which are obviously necessary to give effect to a piece of devolved legislation, but which raise no separate issue of principle. Indeed the amendments to the RTOA replacing references to the district court with references to the justice of the peace court in para 7 of the Schedule to the 2007 Act are as good an example as any of minor consequential amendments to the law on reserved matters which para 3(1) of Part I of Schedule 4 to the 1998 Act permits the Scottish Parliament to make. In fact, para 444 of the Explanatory Notes says that Paragraph 7 is consequential upon the establishment of JP courts and inserts references to that court in place of the district court. But the modifications made by section 45 of the 2007 Act are of a completely different character and the draftsman clearly thought so, since they are effected not in the Schedule but by a separate section in the body of the Act. Section 45 is one of three sections (the others being 43 and 44) which combine to alter the jurisdiction of the sheriff sitting as a court of summary jurisdiction. None of the sections can be regarded as incidental to, or consequential on, another: they are all independent and deal with distinct aspects of the situation. Needless to say, the relevant paragraphs of the Explanatory Notes do not suggest that section 45 is to be regarded as merely consequential or incidental. Moreover, section 45 applies to any penalty provision in a relevant enactment which, by subsection (7), covers any Act passed before the 2007 Act. These are the words which bring in, for example, the RTOA. So the modifications of the law on reserved matters made by section 45 are effected by exactly the same words as the modifications of the law on devolved matters. Both sets of modifications play an equivalent part in the overall scheme the modifications to reserved penalty provisions are of no less importance than the modifications to devolved penalty provisions. Neither can be regarded as incidental to, or consequential on, the other. Despite this, in Logan v Harrower the appeal court considered that the modifications to the law in Part I of Schedule 2 to the RTOA were merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin. The reasoning is not easy to follow. It is enough, however, to observe that neither section 45 nor any other provision in the 2007 Act actually has any separate more general aspect relating generally to the powers of the sheriff in relation to statutory offences. So there is no separate devolved provision of that kind and, more particularly, no separate provision made which does not relate to reserved matters in relation to which the modifications to the RTOA made by section 45 could ever be regarded as incidental or consequential. For these reasons, like Lord Hope, I am satisfied that para 3(1) of Part I of Schedule 4 to the 1998 Act does not have the effect of preventing para 2 from applying to section 45 of the 2007 Act. It is therefore necessary to look at the qualification to para 2(1) which is to be found in para 2(3), and which the appeal court did not consider in Logan v Harrower because of their conclusion on para 3(1). Is the rule of law in the RTOA special to a reserved matter under para 2(3)? Unquestionably, section 33 of the RTOA and the relevant entry in Part I of Schedule 2 comprise a rule of Scots criminal law to the effect that, on a summary conviction of a contravention of section 103(1)(b) of the RTA, the maximum punishment by way of imprisonment which may be imposed on the offender is 6 months. That is the rule which section 45 purports to modify. Paragraph 2(1) of Part I of Schedule 4 prevents the Scottish Parliament from modifying a rule of Scots criminal law only to the extent that the rule is special to a reserved matter. So the Court has to decide whether this rule is special to a reserved matter. The advocate depute argued that the rule is not special to this reserved matter or indeed to any other reserved matter: the rule simply prescribes a maximum penalty of 6 months imprisonment for a conviction on summary complaint and that is a penalty that is found in many statutes, on both reserved and devolved matters. To be special, the penalty would have to be one that was not prescribed for an infringement of any statute dealing with a devolved matter. In theory, for instance, it would have applied if the unique penalty for an infringement of section 103(1)(b) of the RTA had been per impossibile say, whipping. Then, because that was a penalty which was found only within the sphere of reserved matters, the Scottish Parliament would be prevented from modifying it. It is fair, however, to say that the advocate depute was unable to point to any actual rule of Scottish criminal law or procedure to which, on his preferred construction, para 2(1) would apply. Although I was initially attracted by the advocate deputes argument, it cannot be right, since, on his construction, the limit makes no sense whatever. Why should the Scottish Parliaments power to modify an enactment whose subject matter is a reserved matter depend on whether there happens to be some comparable enactment dealing with a completely different devolved matter? More particularly, why should the Scottish Parliament be entitled to modify the maximum term of 6 months imprisonment on summary conviction of a contravention of section 103(1)(b) of the RTA in Part I of Schedule 2 to the RTOA simply because there happen to be a number of either way offences in the devolved area where the maximum term of imprisonment on summary conviction is also 6 months? Of course, the Parliament can alter the penalty provision for those offences because it is its business to make such amendments where appropriate. But that is, of itself, no reason why it should become the Scottish Parliaments business for whatever purpose to modify the penalty provision which Parliament has deliberately chosen to enact for a specific offence for which Parliament retains responsibility. The general point can be illustrated by reference to limitation periods. As Mr Johnston QC points out, in Prescription and Limitation (1999), Appendix II, p 371, the Prescription and Limitation (Scotland) Act 1973 (the 1973 Act) does not say that its provisions are not to apply where other enactments establish a prescriptive or limitation period for specific rights or remedies. Nevertheless, as he goes on to say, on general principles of statutory construction, it can be assumed that an enactment of a special nature takes precedence over an enactment of a general nature: the 1973 Act is therefore displaced by more specific provision in other enactments. Mr Johnston then gives a useful table listing a range of enactments which contain their own specific limitation periods. By contrast, there are many statutes which provide for civil liability but do not contain any separate, specific, provision on limitation of proceedings brought for their breach. For example, a breach of a duty under the Provision and Use of Work Equipment Regulations 1998 (No 2306) is actionable: section 42 of the Health and Safety Act 1974. But there is no special rule of law on the limitation of proceedings for such a breach: the general rule of law in the 1973 Act applies. Therefore, if the Scottish Parliament chose to alter that general rule in the 1973 Act, it could do so and the new period would apply to actions for breach of the Regulations. This is so, even though Part I of the Health and Safety Act is a reserved matter: para 1 and Section H2 of Part II of Schedule 5 to the 1998 Act. Many statutes do make special provision on limitation, however. For example, under section 568(5) of the Companies Act 2006, an action for loss suffered because of a contravention of the pre emption provision in a companys articles must be brought within 2 years. That is unquestionably the law on a reserved matter as defined in para 2(2) of Part I of Schedule 4 to the 1998 Act. It is surely unthinkable that, even as part of an exercise to tidy up the Scots law of limitation of actions, the Scottish Parliament would be able to alter that period, which is special in the sense that, instead of relying on the general law of limitation, Parliament has deliberately selected 2 years as being appropriate for proceedings of that particular kind. Leaving aside any other possible difficulties, if the Scottish Parliament could change the period, the result would be to introduce a difference between English and Scots law in an area where Parliament, legislating after devolution, must have considered that the same special rule should continue to apply in both jurisdictions. Equally surely, the power of the Scottish Parliament to alter the period in section 568(5) of the Companies Act could not be affected because, if you rooted around in the statute book, you could find that, under section 5 of the Limitations of Actions and Costs Act 1842, the limitation period for actions brought under local and personal Acts (which would, usually at least, concern devolved matters) happened also to be 2 years. Likewise, it would be irrational to conclude that, if the Scottish Parliament were to repeal or amend section 5 of the 1842 Act so that it no longer provided for a period of 2 years, this would somehow simultaneously remove a power which the Parliament had hitherto enjoyed to amend the limitation period under section 568(5) of the Companies Act 2006. Quite simply, the two enactments have nothing to do with one another. Conversely and reverting to penalties it would be absurd to hold that the Scottish Parliament could not modify a penalty provision so long as it was special to, in the sense of unique to, a reserved matter, but could give itself the power to do so by enacting the same penalty for a devolved matter. Besides being absurd, this would offend against the principle that the limits on the competence of the Scottish Parliament are fixed by the 1998 Act and cannot be altered except by new legislation by Parliament or by Order in Council under section 30(2). What, then, do the critical words mean? In my view, a statutory rule of law is special to a reserved matter if it has been specially, specifically, enacted to apply to the reserved matter in question as opposed to being a general rule of Scots private or criminal law which applies to, inter alia, a reserved matter. Only general rules whose subject matter is listed in sub paras (a) to (e) of para 2(3), as amended, are protected from modification. If interpreted in this way, para 2(3) means that para 2(1) prevents the Scottish Parliament from modifying any enactment which must be taken to reflect the conscious choice of Parliament to make special provision for the particular circumstances, rather than to rely on some general provision of Scottish private or criminal law. Whether or not to modify such an enactment involves questions of policy which must be left for the consideration of the United Kingdom government and Parliament which are responsible for the matter. On this interpretation, paras 2(1) and (3) place a comprehensible limit on what the Scottish Parliament can do. I return to the particular problem in these appeals. Suppose that, instead of increasing the maximum term of imprisonment available on summary conviction of a contravention of section 103(1)(b) of the RTA from 6 to 12 months, the Scottish Parliament had chosen to reduce it to 3 months perhaps as part of a general package of reductions in sentences designed to save money by cutting expenditure on criminal justice. The purpose of the legislation would plainly relate to a devolved matter. Nevertheless, the Scottish Parliament could not achieve that purpose by modifying the RTOA in that way because the maximum term of imprisonment on summary conviction of the offence had been specially chosen by Parliament. The modification would therefore be outside the competence of the Scottish Parliament by virtue of para 2 of Part I of Schedule 4. And it would rightly be outside competence because it would inevitably involve significant road traffic policy issues which, under the 1998 Act, it would be for the United Kingdom government (more particularly, the Secretary of State for Transport) and Parliament to evaluate. For instance, would it be acceptable if the average sentence for driving while disqualified fell because prosecutors were reluctant to mount the more complicated and time consuming sheriff and jury trials necessary to attract a prison sentence of more than 3 months? Would the potential cost cutting advantages of the policy outweigh this possible disadvantage? Mutatis mutandis, the Secretary of State for Transport and the United Kingdom government as a whole would have to consider these issues if the Ministry of Justice made an equivalent proposal for England and Wales. If they ultimately agreed, Parliament would be asked to legislate to amend the RTOA. In the case of Scotland, if the United Kingdom government and Parliament were content, the necessary changes could be made by a section 104 order. If a reduction in the maximum term of imprisonment on summary conviction would be outside the competence of the Scottish Parliament in this way, the same must apply to an increase. For these reasons I conclude that the rule of Scots criminal law prescribing the maximum term of imprisonment for a summary conviction of a contravention of section 103(1)(b) of the RTA, in Part I of Schedule 2 to the RTOA, is special to that reserved matter, in the sense that Parliament has chosen it specifically for that offence. So, by virtue of para 2(1) of Part I of Schedule 4 to the 1998 Act, the Scottish Parliament has no power to modify it. A majority of your Lordships have reached the opposite view. At para 34 of his judgment, Lord Hope accepts that, when considering para 2 of Part I of Schedule 4, the starting point is identifying the rule of Scots criminal law that is being modified. Then one must ask whether that rule is special to a reserved matter. Naturally, I agree. Lord Hope takes the view that the purpose of the enactment may be referred to in order to identify the rule of law that is being modified. I see no room for that approach in this case. Here, the purpose of the enactment is clear and undisputed: to increase the sheriffs summary sentencing powers. If, however, you want to know which rules of Scottish criminal law the enactment is modifying in order to achieve that purpose, you simply have to look at the perfectly clear terms of section 45 and apply them to the penal provisions in question. I agree with Lord Hope when he says, at paras 35 and 37, that the rule of Scots law as to the maximum term of imprisonment that can be imposed i e the maximum period of 12 months on indictment, set out in the relevant part of column 4 of the Schedule falls to be treated as a rule that is special to a reserved matter. I have explained my reasons for taking that view. These cannot, of course, be Lord Hopes reasons. But he gives no explanation for his view beyond the assertion that it plainly, is a rule which is special to the Road Traffic Acts and it is a reserved matter. In para 39 Lord Hope considers that it would be to carry the process of analysis too far to say that the Schedule contains two maximum sentences, one for summary proceedings and the other for proceedings on indictment. But that is precisely what Parliament does say in section 33(1) of the RTOA read together with the relevant entry in the Schedule (referring to the maximum punishment by way of imprisonment and giving different figures depending on the mode of trial). Lord Hope also thinks that it would be carrying the process of analysis too far to say that both of these maximum sentences are special. Apparently this is because such a decision depends on an exercise of judgment in which the purpose of the provision (here, section 45) may be the best guide. But, as the cross headings show, para 2 of Part I of Schedule 4 is designed to protect the law on reserved matters from modification. It is therefore necessary to identify which rules of Scots criminal law are to be regarded as special to a reserved matter in terms of para 2(3) and so protected from modification. Since, ex hypothesi, these rules cannot be modified, they cannot be identified by reference to the purpose of a provision which purports to modify them. In the end, therefore, all we know is that, for some unstated reason, the maximum sentence which can be imposed on conviction of a contravention of section 103(1)(b) of the RTA in a prosecution on indictment is a rule which is special to the Road Traffic Acts, but the maximum sentence which can be imposed for the same offence in a summary prosecution is not. In para 59 of his judgment Lord Walker identifies what the relevant rule of Scots criminal law to be modified is not: it is not that driving while disqualified is a criminal offence (agreed), nor that it is a criminal offence punishable by imprisonment (agreed), nor that the maximum term of imprisonment is 12 months (also agreed, since, again, this must be a reference to the maximum term of imprisonment in a prosecution on indictment). The inference seems to be that these rules might indeed be special to a reserved matter and beyond the reach of the Scottish Parliament. As Lord Walker says, however, all these rules have been left untouched. You then eagerly wait to hear about the rule that has not been left untouched: that the maximum term of imprisonment is 6 months in a summary prosecution. But you wait in vain. Instead, the rule to be modified turns out to be whether (and if so to what degree) the option of summary trial before the sheriff should reduce the maximum sentence that can be passed. With great respect, that does not really look much like a rule of Scots criminal law. But, whatever the description, it is actually the product of the two specific rules of Scots criminal law as to the maximum term of imprisonment for a contravention of section 103(1)(b) of the RTA in summary and indictment proceedings respectively. That product can itself be modified only by modifying either or both of these specific rules. By enacting section 45, the Scottish Parliament purported to modify the rule that the maximum term of imprisonment for this offence in summary proceedings is 6 months. The unavoidable question is whether that rule is special to a reserved matter in terms of para 2(3) of Part I of Schedule 4 to the 1998 Act. But that question is neither posed nor answered. Having bowed politely in the general direction of the argument, Lord Brown rests his conclusion on simple assertion. Until now, judges, lawyers and law students have had to try to work out what Parliament meant by a rule of Scots criminal law that is special to a reserved matter. That is, on any view, a difficult enough problem. Now, however, they must also try to work out what the Supreme Court means by these words. It is a new and intriguing mystery. Conclusion In my view, so far as it relates to the penalty provision in the RTOA relating to contraventions of section 103(1)(b) of the RTA, section 45 was outside the competence of the Scottish Parliament. There was, of course, nothing to prevent the Scottish Parliament from increasing the maximum term of imprisonment which a sheriff, sitting as a court of summary jurisdiction, could impose. That is what section 45(1) does and, by itself, the provision is unobjectionable since it merely deals with the jurisdiction of the sheriff. But any increase in jurisdiction brought about by section 45(1) would remain subject to all the penalty provisions in statutes which stipulate a lower maximum term of imprisonment on summary conviction. So subsection (2) was introduced in order to modify all those provisions. Modification of penal provisions in statutes falling within the devolved sphere causes no difficulty. But, for the reasons I have explained, modifying a specific penal provision in a statute within the reserved area is outside competence essentially, because it involves making a significant change to law which Parliament has decided is to be its own responsibility. Of course, it is true that the purpose of section 45 is to increase the sheriffs summary sentencing powers. That is why section 45 does not relate to reserved matters and so is not beyond the competence of the Scottish Parliament by virtue of section 29(2)(b). But a purpose of increasing the summary sentencing powers of sheriffs or other lower court judges is not a passport that entitles the Scottish Parliament to disregard the prohibitions in the other paragraphs of section 29(2) and to sweep aside any provision of the RTOA which stands in its way. The competent end does not justify the use of means which are beyond competence. If evidence to support that simple proposition were needed, it is to be found in the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007, which was made under section 104 of the 1998 Act shortly before the 2007 Act came into force. The order was not mentioned by counsel on either side. Its purpose was, first, to repeal the provisions of the RTOA which prevented the district court (and its successor, the justice of the peace court) from imposing the penalty of disqualification for traffic offences, and then to amend section 34 so as to include the district court (and, hence, the justice of the peace court) among the courts with the power to impose that penalty for such offences. Even though these changes were clearly part of the overall scheme in the 2007 Act, to allow the lower courts to hear more serious cases by increasing their sentencing powers, it was recognised that the section 104 order was needed to carry out this particular aspect of the scheme. By contrast, the minor consequential amendment to section 248C(1) of the 1995 Act, relating to the disqualification power for other offences, was made by section 80 of, and para 26 of the Schedule to, the 2007 Act. In order to achieve another part of the scheme to adjust the jurisdiction of the Scottish courts by increasing the sentencing powers of the lower courts, section 45 of the 2007 Act purports to modify, inter alia, the enactment relating to contraventions of section 103(1)(b) of the RTA in Part I of Schedule 2 to the (reserved) RTOA. As a result, the maximum term of imprisonment that can be imposed for that offence by a court of summary jurisdiction in Scotland is intended to be twice what can be imposed by the equivalent court in England. Of course, it is not essential that the two jurisdictions should march exactly in step on this matter as is plain from the availability of indictment proceedings with a maximum sentence of 12 months imprisonment in Scotland, but not in England. But that is a disparity which Parliament chose to introduce. Whether a further disparity between the jurisdictions should indeed be introduced is precisely the kind of issue like the issue as to whether the district court or justice of the peace court, rather than just the sheriff court, should have power to disqualify for road traffic offences which the 1998 Act intends that Parliament should decide. This need cause no difficulty for the Scottish Executives scheme to adjust the jurisdiction of the Scottish courts by increasing the sentencing powers of sheriffs in summary cases if the United Kingdom government and Parliament are content that the maximum available term of imprisonment for this offence on summary conviction should be increased in this way. Provided the draft is approved by both Houses of Parliament, the appropriate order can be made under section 104 of the 1998 Act: sections 114 and 115 and paras 2 and 3 of Schedule 7. This is indeed precisely the kind of situation for which section 104 was designed. Applying section 101 of the 1998 Act, I would therefore hold that the definition of relevant penalty provision in section 45(7) of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 does not include a provision of a relevant enactment or instrument which is special to a reserved matter within the meaning of para 2(3) of Part I of Schedule 4 to the Scotland Act 1998. It follows that section 45 does not modify the maximum term of imprisonment of 6 months on summary conviction of a contravention of section 103(1)(b) of the Road Traffic Act 1988 in column 4 of Part I of Schedule 2 to the Road Traffic Offenders Act 1988. I would accordingly allow the appeals, pass the bills of suspension, quash the sentence imposed by the sheriff court in each case for the contravention of section 103(1)(b) of the Road Traffic Act 1988 and remit to the appeal court to proceed as accords. LORD KERR The legislative competence of the Scottish Parliament is self evidently a subject of fundamental importance. As the appeals in these cases amply demonstrate, however, it is impossible to devise a comprehensive charter which, for every conceivable situation, infallibly prescribes the limits of that legislatures enacting power. This, it seems to me, is the inevitable consequence of the transfer by the United Kingdom government of some or even many powers to a devolved administration while retaining or, as it is more usually put, reserving, certain other matters to Parliament in Westminster. Whether a particular Act of the Scottish Parliament falls within its legislative competence will, for the most part therefore, depend on a consideration of the particular provisions of the enactment in question. The quest will usually begin with section 29 of the Scotland Act 1998. It stipulates (in subsection (1)) that any provision of an Act of the Scottish Parliament is not law so far as it is outside the legislative competence of the Parliament. Subsection (2) (b) states that a provision is outside the competence of the Scottish Parliament if it relates to reserved matters. The issue as to whether a provision does so relate is to be determined in accordance with subsection (3) which, so far as is material, provides: the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter is to be determined, subject to subsection (4), by reference to the purpose of the provision, having regard (among other things) to its effect in all the circumstances. Subsection (3) has a number of component parts, each of which deserves careful consideration. The first is that which specifies that it is subject to subsection (4). This latter subsection (to which I shall turn presently) is a deeming provision designed to expand the category of cases in which a change in the law is to be considered to relate to reserved matters because it modifies Scots private or criminal law as it applies to reserved matters. The need to enlarge the group in this way appears to me to clearly indicate that the construction to be placed on the expression relates to reserved matters must be suitably restrained. If, in every instance where a provision of the Scottish Parliament touched on a reserved matter, it was to be considered to relate to a reserved matter, subsection (4) would not be needed. The phrase needs a more careful and restricted application, therefore. Guidance as to the extent of the restriction is provided by the next component part of section 29 (3). The resolution of the question whether a particular provision relates to a reserved matter is to be determined by reference to the purpose of the provision. One is immediately thereby drawn to an examination of the objective of the legislation and of the particular provision within it. Before dealing with the result of that examination, it is useful to note the next component part of subsection (3). It is to the effect that the determination (by reference to its purpose) whether an Act of the Scottish Parliament relates to a reserved matter is to be conducted having regard to (among other things) its effect in all the circumstances. It seems to me obvious that the way in which the subsection is structured signifies that the effect of the provision is subordinate to its purpose in the inquiry as to whether it relates to a reserved matter. Indeed, the assessment of the effect of the provision is directly linked to the search for its purpose. This is unsurprising. As Lord Brown pointed out in the course of argument, one will customarily expect that the purpose of a particular provision is to bring about a desired effect. The other things, apart from the effect of the provision, which are to be taken into account in ascertaining its purpose are not specified in subsection (3). Mr Brown on behalf of the appellant, Mr Miller, accepted (sensibly and correctly, in my view) that these would include statements by those responsible for the legislation which purported to identify the reasons for its enactment. The genesis of the legislation under challenge here is the report of the Committee appointed in November 2001 to review summary justice in Scotland under the chairmanship of Sheriff Principal John McInnes QC. The formal remit of the Committee was stated to be: To review the provision of summary justice in Scotland, including the structures and procedures of the sheriff courts and district courts as they relate to summary business and the inter relation between the two levels of court, and to make recommendations for the more efficient and effective delivery of summary justice in Scotland. In paragraph 9 of its summary of recommendations the Committee recorded its proposal that the criminal jurisdiction for judges in summary cases should be a maximum 12 months detention or imprisonment and a 20,000 fine. The reasons for this particular recommendation are discussed throughout the report. In paragraph 7.72 on page 78 at paragraph (iv) it is explained that the view of the majority of the Committee was that there was a need to relieve pressure on the higher courts. This required the lower courts to take on more serious cases. Consequently, some increase in sentencing powers for the judges in those courts was required. The Committee recognised that recommending an increase in the sentencing powers of the courts of summary jurisdiction could give rise to what is described in the report as sentence drift, that is a tendency to increase the normal sentencing range because of the availability of the increase in the statutory maxima. It made clear its express disavowal of any intention to bring about sentence drift in paragraph 7.89 of the report where the following appears: In proposing an increase in sentencing powers, we are clear that we do not intend any uplift of the going rate for all offences, but rather we wish to extend the range of offences that can appropriately be dealt with in the summary courts. The Ministerial response to the McInnes recommendations was contained in a report entitled, Smarter Justice, Safer Communities Summary Justice Reform published in March 2005. In paragraph 4.10 the Scottish Executive signalled its acceptance of the proposal that there be an increase in the sentencing powers of a sheriff sitting without a jury in summary proceedings, stating that this form of proceeding was generally simpler and faster than trials in a solemn court. The report also acknowledged the concern that there might be upward sentence drift but recorded the Committees finding that there was no evidence that this was linked to an increase of sentencing powers in summary proceedings (para 4.51). The Bill which was to give effect to the recommendations of the McInnes Committee (among other matters), the Criminal Proceedings etc. (Reform) (Scotland) Bill, was introduced to the Scottish Parliament on 27 February 2006. Clause 35, which became section 45 of the enacted legislation, dealt with certain statutory offences (including driving whilst disqualified) and provided for a new maximum term of imprisonment of twelve months to which a person summarily convicted of such an offence would be liable. The Bill was considered by the Justice 1 Committee of the Scottish Parliament on 19 April 2006. In answer to a question from a member of the Justice Committee concerning the possibility of an increase in the prison population because of the enlarged sentencing powers of the sheriff courts in summary proceedings, Noel Rehfisch of the Scottish Executive Justice Department said this, at Scottish Parliament Official Report, cols 2838 2839: it is clear that the intention of the changes is not to be more punitive in respect of any particular offence. For example, for any statutory offence that can be tried only summarily at present, the sentencing limit will not change. The increase to 12 months is about providing headroom in the summary system to deal with slightly more serious cases that, in the view of the McInnes Committee which ministers accepted could relevantly, competently and capably be dealt with in the sheriff summary court. On two occasions in recent years there have been increases in the maximum sentencing level in the sheriff solemn courts. The same sheriffs, albeit with a jury, are responsible for determining sentences in those cases. To date, there is no evidence that those increases have led to what might popularly be described as sentence drift. We are confident that the judiciary will continue to consider individual cases on their merits. The measures are about having the appropriate level of business in certain sectors of the system. These comments were reflected in the 10th report of the Justice 1 Committee published on 5 July 2006. At paragraph 135 of the report the following appears: In oral evidence Executive officials stated that these provisions are about seeking some form of business redistribution to ensure that every level of the system deals with the business that it ought to deal with and managing that as effectively as possible. Indeed, in the Policy Memorandum [containing the Executives comments on the provisions of the Bill], the Executive refers to its policy of creating a flexible court capacity to ensure that cases can be dealt with quickly and at the appropriate level. and at paragraph 136: The Executives expectation is that this redistribution of cases would represent a downward shift of around 500 to 550 cases per year from sheriff and jury to sheriff summary procedure. The Executive has also stated that the provisions in the Bill are not designed to be more punitive in relation to any particular offences. The Scottish Prison Service referred in oral evidence to its view that it does not expect the Bill to have a significant impact on the prison population. It appears to me from all this material that the purpose of section 45 of the 2007 Act is unmistakably clear. As the advocate depute submitted, it is to effect a reallocation of business within the court structure. The means by which this is achieved is an increase in the sentencing powers available to sheriffs sitting in their summary jurisdiction. The greater maximum penalty is not an end in itself nor is it intended that that the going rate for relevant offences should be increased. This is merely the mechanism by which the quite different purpose of providing for a more expeditious dispatch of business can be achieved. This conclusion is reinforced by the consideration that defendants charged with relevant offences are not exposed to a greater penalty in the summary proceedings than they formerly faced if prosecuted for the same offences on indictment. In this context, I should say that I consider that the analogy which the appellants sought to draw with the decision of the Divisional Court in Northern Ireland in the case of Reg (Hume) v Londonderry Justices [1972] N. I. 91 is misconceived. In that case the Parliament of Northern Ireland, in exercise of its powers under section 4 of the Government of Ireland Act 1920 to make laws for the peace, order and good government of Northern Ireland, had purported (by a regulation made in a statutory rule and order by the Minister of Home Affairs) to authorise certain members of Her Majestys forces to require an assembly of persons to disperse if a breach of the peace was apprehended. The Divisional Court held that the regulation was made in breach of section 4 (3) of the 1920 Act which forbade the making of laws by the Northern Ireland Parliament in respect of Her Majestys forces. It had been argued on behalf of the respondent that the pith and substance of the regulation was the peace, order and good government of Northern Ireland and that the conferring of powers on members of the armed forces was merely incidental. This argument was rejected, Lowry LCJ observing (at page 111) that both the object and the method of achieving it must be valid. Since the method in that case had been expressly forbidden, the regulation could not be rescued from its invalidity because it was for a permitted object. By contrast, in the present case the method (enlargement of the sentencing powers in sheriff summary proceedings) of achieving the object (the more efficient and expeditious prosecution of offences) is not expressly forbidden. For these reasons, and for the reasons more fully given by Lord Hope and Lord Rodger, I am therefore satisfied that section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 does not relate to reserved matters within the meaning to be ascribed to that condition in section 29 (2) (b) of the Scotland Act 1998. I turn to briefly consider section 29 (4). It provides: (4) A provision which (a) would otherwise not relate to reserved matters, but (b) makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. As I have already observed, this is a deeming provision which expands the category of cases in which a change in the law is to be considered to relate to reserved matters, although not so relating for the purposes of section 29 (3). Modifications of Scots private or criminal law are to be treated as relating to reserved matters subject to two important qualifications. The first of these is that such modifications are confined to the law as it applies to reserved matters. The advocate depute argued that section 45 of the 2007 Act modified Scots criminal law generally and on that account could not be said to apply solely to reserved matters. It appears to me, however, that this first qualification is not designed to exclude from the ambit of section 29 (4) modifications that relate to both reserved and devolved matters. It was suggested in argument that the purpose of the provision was to prevent the Scottish legislature from targeting reserved matters. This may well be correct but that objective is likely to be severely curtailed if a measure of the Scottish Parliament applying to reserved and devolved measures which were unrelated to each other was exempt from the reach of section 29 (4) and it appears to me that this must be the logical conclusion of the advocate deputes argument. A final determination of this issue is not, in my opinion, strictly necessary, however, because it is quite clear that the impugned legislation comes squarely within the second qualification in section 29 (4). A provision, the purpose of which is to make the law apply consistently to reserved matters and otherwise, is not caught by the subsection. It is unquestionably clear that section 45 of the 2007 Act has that precise purpose and for that reason it does not come within section 29 (4). The final and, to my mind, most troubling issue arises from section 29 (2) (c) of the 1998 Act. It states that a provision is outside the competence of the Scottish Parliament if it is in breach of the restrictions in Schedule 4 to the Act. Paragraph 2 of that Schedule contains the following material provisions: (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent that the rule in question is special to a reserved matter . Section 45 of the 2007 Act self evidently relates to a rule of Scottish criminal law. Is the rule special to a reserved matter? Lord Hope has concluded that the rule is not special to a reserved matter because it does not increase the penalty that can be imposed in respect of the offence but has merely changed the procedural route by which the enlarged penalty can be imposed. It is concerned with a rule of procedure that applies generally to prosecutions for offences in the sheriff court. On this analysis, section 45 is not to be regarded as directed to a rule which is special to a reserved matter. By contrast, Lord Rodger considers that a statutory rule is special to a reserved matter if it has been enacted in order to apply specifically to the rule in question. I have not found it easy to reach a view as to which of these competing and persuasively argued positions is to be preferred. It is clear that paragraph 2 (3) contemplates an ambit or scope of application for a particular rule beyond its possible impact on reserved matters. It is only on the extent to which the application of the rule is special to reserved matters that the denial of legislative competence is engaged. In this context, special to may be regarded as connoting having a specific effect on reserved matters. Where an act of the Scottish Parliament seeks to modify a rule of Scots law which has an effect on reserved matters that act will be outside the legislative competence of the Scottish Parliament. But where the rule of Scots law being modified is not special to reserved matters, Parliaments legislative power remains intact. Viewing the effect of the provision in this way, I have concluded that where an act of the Scottish Parliament modifies a statutory rule which has a specific effect on a reserved matter it comes within the prohibition contained in paragraph 2 (1) of Schedule 4 to the 1998 Act. I therefore agree with Lord Rodger that section 45 is caught by that paragraph. The question then arises whether the section can be saved by recourse to paragraph 3 of Schedule 4 to the 1998 Act which provides: (1) Paragraph 2 does not apply to modifications which are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and do not have greater effect on reserved matters than is necessary to give effect to the purpose of the provision. Both Lord Hope and Lord Rodger have concluded that a statutory provision that alters the sentencing power of the sheriff court sitting in its summary jurisdiction cannot be regarded as coming within this provision. Although I was initially attracted by the notion that the increase in sentencing powers was incidental to a provision being made for the reallocation of court business, I have come to the view that this cannot be right. The increase in sentencing powers is the provision concerned. It is not incidental to another permissible statutory rule. It cannot be saved by paragraph 3, therefore. In the result, I agree with Lord Rodger that this appeal should be allowed.

As originally enacted, s.33 and Part 1 of Schedule 2 to the Road Traffic Offenders Act 1988 (the RTOA) provided that the maximum sentence that a Sheriff sitting summarily could impose in respect of the offence of driving while disqualified (s.103(1)(b) of the Road Traffic Act 1988 (the RTA)) was six months imprisonment or the statutory maximum fine or both. If the offence was prosecuted on indictment, the maximum sentence was 12 months imprisonment or a fine or both. Following a recommendation by a committee appointed to review the provision of summary justice in Scotland that the criminal jurisdiction of judges sitting summarily should be increased to a maximum of 12 months, the Criminal Proceedings etc (Reform)(Scotland) Act 2007 (the 2007 Act) was enacted by the Scottish Parliament. S.45 of that Act increased the maximum sentence that sheriffs sitting summarily could impose for the offence of driving while disqualified to 12 months imprisonment. On 17 December 2007 and 14 May 2008, respectively, in summary proceedings Sean Martin and Ross Miller were each sentenced by Sheriffs to periods in excess of six months imprisonment for driving while disqualified contrary to s.103(1)(b) of the RTA. They both sought to challenge their sentences on the basis that amending the relevant provisions of the 2007 Act were outside the legislative competence of the Scottish Parliament. The High Court of Justiciary (the HCJ) dismissed the appeals, holding that the increase in the sentencing power of Sheriffs sitting summarily by s.45 of the 2007 Act was within the Scottish Parliaments legislative competence. The HCJ gave the Appellants permission to appeal to the Supreme Court. The Supreme Court, by a majority of three to two (Lord Rodger and Lord Kerr dissenting), dismisses the appeals. The Court holds that the provision in question was within the Scottish Parliaments legislative competence. Lord Hope delivered the leading judgment on behalf of the majority. Majority Judgments The answer to the question raised by this case is to be found by applying the rules laid down in s 29 and Part 1 of Schedule 4 the Scotland Act 1998 which determine whether a provision of an Act is outside the Scottish Parliaments legislative competence. Three questions arise in this case: (1) whether the purpose of s.45 was to modify Scots criminal law as defined in s.126(5) of the Scotland Act; (2) if so, whether its purpose was to make the law apply consistently to reserved matters and otherwise; and (3) if (1) and (2) are answered in the affirmative, whether the rule that s.45 modified was special to a reserved matter within the meaning of para 2(3) of Schedule 4 [para [22]]. The purpose of s.45 of the Criminal Proceedings etc (Reform)(Scotland) 2007 Act The available material conclusively demonstrates that the purpose of s.45 was to contribute to the reform of summary justice by reducing pressure on the higher courts. The jurisdiction of a Sheriff is defined by the penalties which he can impose and his powers in this respect are quintessentially matter of Scots criminal law. S.45 was directed to a rule of Scots criminal law, so it does not relate to a reserved matter within the meaning of s.29(2)(b) of the Scotland Act 1998 [para [31]]. Was s.46 concerned to ensure that law applied consistently between reserved and non reserved matters? S.45 is one of a group of related provisions contained in the 2007 Act increasing the summary sentencing powers of Sheriffs in respect of a number of common law and statutory offences. If the 2007 Act had increased the sentencing power in respect of common law but not statutory offences the reform would have been incomplete and confusing. This problem would have been exacerbated if the reform had attempted to distinguish between statutory offences related to reserved matters and those which did not. The purpose of s.45 was to ensure that the law relating to the sentencing powers of Sheriffs was consistent as between offences concerning reserved matters and otherwise. Consequently, s.45 is not related to a reserved matter for the purpose of s.29(4) of the Scotland Act 1998 [paras [32] [33]]. Is the sentencing jurisdiction of a Sheriff in relation to road traffic offences special to the Road Traffic Offenders Act 1988 and the Road Traffic Act 1988? In identifying the rule of law that is being modified for the purpose of the test established by para 2(3) of Schedule 4, regard may be had to the purpose of the legislative provision effecting the modification [para [34]]. The key to the decision in this case lies in identifying the rule that is being modified. This is achieved by examining the purpose of the legislative provision which is under scrutiny [para [38] and [39]]. S.33 and Part 1 of Schedule 2 to the RTOA and s.103(1)(b) of the RTA contain, in effect, two rules of Scots criminal law. Firstly, that the overall maximum sentence in respect of driving while disqualified is 12 months. Secondly, the route by which the maximum sentence can be imposed. The former provision is plainly a rule that is special to the RTOA and RTA and is a reserved matter that the Scottish Parliament has no power to modify. However, the latter is a rule concerning Scots criminal jurisdiction and procedure which is not reserved. The change in the law effected by s.45 does not alter the maximum period of imprisonment for the offence of driving while disqualified. It relates to the procedure which determines whether the sheriff has power to impose that sentence. The rule of Scots law being modified is the rule of Scots criminal procedure. This rule of procedure is not special to the RTOA or RTA [para [37]]. Had it been necessary to address the point, para 3 of Schedule 4 (which provides that legislation having incidental or minor effects upon reserved matters shall be within competence) could not, contrary to the conclusion reached by the HCJ, render s.45 within the Scottish Parliaments legislative competence. s.45 constituted an important modification to a rule of Scots criminal procedure that could not be regarded as incidental or consequential [para [40]]. Accordingly the court holds that s.45 is within the legislative competence of the Scottish Parliament. The appeals are dismissed and remitted to the HCJ for any further orders that may be required [para [43]]. Dissenting Judgments Lord Rodger agreed that s.45 did not relate to a reserved matter [para [119]]. But he would have held that the provision of the RTOA prescribing the maximum term of imprisonment for a summary conviction for driving while disqualified is special to a reserved matter, in the sense that the United Kingdom Parliament has chosen it specifically for that offence. Lord Rodger did not agree that the purpose of the modifying provision can be a relevant consideration in identifying the rule of Scots law that is being modified for the purpose of para 2(3) of Schedule 4 [para [143]]. He also did not agree that the purpose of a provision which purports to modify a rule of Scots law can be used to determine whether that rule is special to a reserved matter [para [145]]. Lord Kerr agreed with Lord Rodger.

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The question at issue on this appeal is what connection must a foreign company have with the United Kingdom to entitle an English court to wind it up, if its centre of main interests (or COMI) is in another member state of the European Union. The answer depends on the meaning of two words, economic activity, in EU Regulation 1346/2000 on Insolvency Proceedings. The legal framework Under section 221 of the Insolvency Act 1986, the English court has jurisdiction under its domestic law to wind up a foreign company. However, in the case of companies whose COMI is in another member state of the EU, the exercise of this power is constrained by the Regulation. Article 3 of the Regulation provides as follows: Article 3 International jurisdiction 1. The courts of the Member State within the territory of which the centre of a debtor's main interests is situated shall have jurisdiction to open insolvency proceedings. In the case of a company or legal person, the place of the registered office shall be presumed to be the centre of its main interests in the absence of proof to the contrary. 2. Where the centre of a debtor's main interests is situated within the territory of a Member State, the courts of another Member State shall have jurisdiction to open insolvency proceedings against that debtor only if he possesses an establishment within the territory of that other Member State. The effects of those proceedings shall be restricted to the assets of the debtor situated in the territory of the latter Member State. Where insolvency proceedings have been opened under paragraph 1, any proceedings opened subsequently under paragraph 2 shall be secondary proceedings. These latter proceedings must be winding up proceedings. 3. The COMI is not a term of art, and is not defined in the body of the Regulation. Recital (13), however, recites what is perhaps implicit in the phrase, namely that it should correspond to the place where the debtor conducts the administration of his interests on a regular basis and is therefore ascertainable by third parties. Jurisdiction to begin secondary insolvency proceedings in another European jurisdiction is established on a very different basis. It depends on the existence of an establishment within its territory. An establishment is defined in article 2(h) as any place of operations where the debtor carries out a non transitory economic activity with human means and goods. Goods is hardly a satisfactory English word to use in this context. It is apparent from the equivalent term in the other language versions that it means the same as assets (biens, Vermgen) in article 3(2). The facts Olympic Airlines SA was wound up on the direction of the Athens Court of Appeal on 2 October 2009. Since then, the main liquidation proceedings have been in progress in Greece. The appellants are the trustees of the companys pension scheme. Olympic is the principal employer in the scheme and the only employer currently participating in it. Under the rules of the scheme, it must be wound up upon the liquidation of Olympic Airlines. Upon its winding up, a deficit was ascertained of (in round numbers) 16m, which Olympic is bound to make good under section 75 of the Pensions Act 1995. On 20 July 2010, the trustees presented a winding up petition against the company in England on the ground that it was unable to meet this liability. The size of Olympics deficiency means that they are unlikely to recover much. But the winding up order was necessary in order that the scheme should qualify for entry into the Pension Protection Fund under section 127 of the Pensions Act 2004. One of the conditions of entry was that a qualifying insolvency event should have occurred, and the only available one was that the company should have been ordered to be wound up under the Insolvency Act 1986: see Pensions Act 2004, section 121(3)(g). Accordingly, the question arises whether Olympic had an establishment in the United Kingdom on 20 July 2010 so as to justify the presentation of a winding up petition on that date. Olympic had had a number of offices in the United Kingdom, but the only ones which it still occupied on 20 July 2010 were its former UK head office at 11 Conduit Street in London, which it leased from an associated company. The Chancellor heard evidence about the status of 11 Conduit Street and the activities that were carried on there at the relevant time. He and the Court of Appeal made the following findings: (1) On 28 September 2009, shortly before the commencement of the liquidation proceedings in Greece, the area manager for Olympic in London was instructed that the company would cease all commercial operations as from 00.01 on the following day. From that time all flight operations were undertaken by an unrelated company. (2) On 17 June 2010, the Greek liquidator informed the trustees of the pension fund that the employment of the 27 remaining UK staff would be terminated with effect from 14 July 2010. Three persons, Mr Savva the General Manager, Mr Platanias the Finance and Purchasing Manager, and an accounts clerk, were retained thereafter on short term ad hoc contracts. At the time of the English winding up petition, they were the only persons still working there. (3) Mr Savva attended the office at Conduit Street as required. In practice this was about three or four times a week. His function was to deal generally with anything requiring attention, principally instructions and requests from the liquidator and staff in Athens retained by him. (4) Mr Platanias arranged the payment of bills for his own salary and Mr Savvas, council tax, electricity and cleaning, and for minor repairs following a break in. He reconciled bank statements, copied and sent relevant documents to the liquidator and his staff in Athens and dealt generally with post and telephone calls. He supervised the disposal of the companys assets in England, a process which had begun before the winding up petition and continued for some time afterwards. These comprised a current and deposit account, computers and office furniture, fixtures and fittings and computerised accounting records. They had no substantial realisable value. The Chancellor found that Mr Platanias functions were exactly what is to be expected from one responsible to an overseas liquidator for winding up the affairs of a foreign branch of a formerly substantial overseas trading company. (5) The clerk assisted in these activities under the direction of Mr Savva or Mr Platanias. The decisions of the courts below The Chancellor considered that to be economic an activity did not have to amount to external market activity: [2013] 1 BCLC 415. He found that these activities constituted non transitory economic activities for the purpose of the definition of establishment and made the winding up order. The Court of Appeal (Moore Bick LJ, Sir Stephen Sedley and Sir Bernard Rix) overruled him: [2014] 1 WLR 1401. In summary, they thought that the relevant economic activity had to consist of more than the activity involved in winding up the companys affairs, and that the three remaining employees were doing no more than that. After the Court of Appeal handed down its decision, the law was changed. A statutory power under the Pensions Act 2004 was exercised so as to prescribe an additional insolvency event for the purpose of section 121. The additional event was defined in such a way as to apply only to cases in which insolvency proceedings had been commenced in another member state of the EU in respect of an employer whose COMI was located in that state, and secondary proceedings had been begun in the United Kingdom but had subsequently been set aside for want of jurisdiction: see the Pension Fund (Entry Rules) (Amendment) Regulations 2014 (SI 2014/1664). This appears to be a class of one: the present case. However, for technical reasons, the present issue remains important even though the effect of the amendment is to enable the Olympic pension scheme to qualify for the Pension Protection Fund on the basis of the Greek proceedings. The reason is that where the new insolvency event applies it is deemed to occur on the fifth anniversary of the commencement of the Greek proceedings, ie on 2 October 2014. This is rather more than four years after the date of the winding up order made by the High Court. This matters, because of the possibility that the Board of the Pension Protection Fund might require the trustees of the Olympic scheme to claw back any overpaid benefits between the commencement of the Greek liquidation proceedings and the relevant insolvency event. If that event occurred on 2 October 2014 instead of 29 May 2012, the period over which the benefits may be clawed back will be longer. Authorities The text of the Regulation is largely derived from the Convention on Insolvency Proceedings which was opened for signature in Brussels on 23 November 1995, but failed for want of a sufficient number of signatories. The Convention had been the subject of an authoritative commentary by Professor Miguel Virgos and M Etienne Schmit. According to the Virgos Schmit Report (3 May 1996, OJL 6500/96), the definition of establishment reflected a compromise between universalist states, who favoured a single liquidation with universal effect, and territorialist states, who wished to recognise a jurisdiction to open national territorial proceedings based on the mere presence of local business assets whether or not there was any local place of business. The compromise consisted in the acceptance by the territorialists that jurisdiction to open secondary proceedings should be founded on the existence of a local establishment, but with a broad definition of the activities that must be carried on there. At para 71, the Report commented on the resultant definition as follows: 71. For the Convention on insolvency proceedings, establishment is understood to mean a place of operations through which the debtor carries out an economic activity on a non transitory basis, and where he uses human resources and goods. Place of operations means a place from which economic activities are exercised on the market (ie externally), whether the said activities are commercial, industrial or professional. The emphasis on an economic activity having to be carried out using human resources shows the need for a minimum level of organization. A purely occasional place of operations cannot be classified as an establishment. A certain stability is required. The negative formula (non transitory) aims to avoid minimum time requirements. The decisive factor is how the activity appears externally, and not the intention of the debtor. The rationale behind the rule is that foreign economic operators conducting their economic activities through a local establishment should be subject to the same rules as national economic operators as long as they are both operating in the same market. In this way, potential creditors concluding a contract with a local establishment will not have to worry about whether the company is a national or foreign one. Their information costs and legal risks in the event of insolvency of the debtor will be the same whether they conclude a contract with a national undertaking or a foreign undertaking with a local presence on that market. Naturally, the possibility of opening local territorial insolvency proceedings makes sense only if the debtor possesses sufficient assets within the jurisdiction. Whether or not these assets are linked to the economic activities of the establishment is of no relevance. This provides much the most useful source of guidance. By comparison, there is very limited help to be had from decided cases. Decisions on the location of a companys COMI are addressed to a different test. Decisions on what constitutes an establishment can rarely be more than illustrative given the fact sensitive nature of the inquiry. In (Case C 396/09) Interedil Srl (in liquidation) v Fallimento Interedil Srl [2011] ECR I 9939: [2012] BUS LR 1582, the Court of Justice of the European Union dealt with the question whether the presence of immovable property was enough to confer jurisdiction to open secondary insolvency proceedings. The court did not specifically address the question what constituted economic activity, but it dealt generally with the definition of establishment at paras 61 63 as follows: 61. Article 2(h) of the Regulation defines the term establishment as designating any place of operations where the debtor carries out a non transitory economic activity with human means and goods. 62. The fact that that definition links the pursuit of an economic activity to the presence of human resources shows that a minimum level of organisation and a degree of stability are required. It follows that, conversely, the presence alone of goods in isolation or bank accounts does not, in principle, satisfy the requirements for classification as an establishment. 63. Since, in accordance with article 3(2) of the Regulation, the presence of an establishment in the territory of a member state confers jurisdiction on the courts of that State to open secondary insolvency proceedings against the debtor, it must be concluded that, in order to ensure legal certainty and foreseeability concerning the determination of the courts with jurisdiction, the existence of an establishment must be determined, in the same way as the location of the centre of main interests, on the basis of objective factors which are ascertainable by third parties. Two English decisions illustrate the application of the test to particular facts. In Shierson v Vlieland Boddy [2005] 1 WLR 3966, the Court of Appeal was concerned with an English debtor whose COMI was in Spain but who let and managed premises in England. It cited and implicitly adopted para 71 of the Virgos Schmit Report, and concluded that the letting and management of the premises themselves was enough to make them an establishment. In In re Office Metro Ltd [2012] BCC 829, Mann J was concerned with secondary proceedings in England in respect of an English company whose COMI was in Luxembourg and which was in liquidation there. It used an office in England, at which it handled the settlement of liabilities on guarantees of leases to associated companies, dealt with Companies Act filings, forwarded post, and occasionally took legal and accountancy advice. Perhaps wisely, the judge did not attempt a general definition of economic activity, but expressed the view that the activities carried out at the relevant premises were not economic activities and that in any event they were transitory. Application to the present case The definition in article 2(h) must be read as a whole, not broken down into discrete elements, for each element colours the others. The relevant activities must be (i) economic, (ii) non transitory, (iii) carried on from a place of operations, and (iv) using the debtors assets and human agents. This suggests that what is envisaged is a fixed place of business. The requirement that the activities should be carried on with the debtors assets and human agents suggests a business activity consisting in dealings with third parties, and not pure acts of internal administration. As the Virgos Schmit Report suggests, the activities must be exercised on the market (ie externally). I am inclined to think that the same point was being made by the Court of Justice when it observed in Interedil that the activities must be sufficiently accessible to enable third parties, that is to say in particular the companys creditors, to be aware of them. I do not think that this can sensibly be read as requiring that the debtor should simply be locatable or identifiable by a brass plate on a door. It refers to the character of the economic activities. They must be activities which by their nature involve business dealings with third parties. Manifestly, some activities which a company in liquidation might carry on, may satisfy the definition. This may happen not only where the liquidator carries on the business with a view to its disposal but also, for example, where he disposes of stock in trade on the market. On the other hand, where a company has no subsisting business it is clearly not the case that the mere internal administration of its winding up will qualify. Such activity would not be exercised on the market; moreover, if it were enough to establish jurisdiction then the requirement for economic activities would add little or nothing to the rest of the definition. Indeed, the definition would almost always be satisfied by a debtor who retained premises in the United Kingdom with inevitable outgoings such as the payment of rent, business rates, and so on. It is unnecessary in the present case to undertake the difficult task of drawing a precise boundary between these extremes because, on any reasonable view of the meaning and purpose of the definition, the facts of this case are on the wrong side of it. Olympic was not carrying on any business activity at 11 Conduit Street on the relevant date. The last of the companys business activities had ceased some time before. All that Mr Savva and Mr Platanias were doing was handling matters of internal administration associated with the final stages of the companys disposal of the means of carrying on business. The company cannot therefore be said to have had an establishment in the United Kingdom. Reference under Article 267 TFEU In my opinion, the necessity for showing at least some subsisting business with third parties before the definition can be satisfied is acte clair, even if the exact nature of that business and the degree to which it must be visible to outsiders may be open to argument. Since in this case no external business at all was carried on from 11 Conduit Street, there is no point of principle calling for a reference. Disposal I would dismiss the appeal.

Olympic Airlines SA was wound up by a court in Athens on 2 October 2009. The main liquidation proceedings are ongoing in Greece. The company pension scheme has a 16m deficit. Olympic Airlines SA is liable to make good the deficit by s 75 of the Pensions Act 1995. It is unlikely to be able to do so. Members of the pension scheme are eligible for compensation under the Pensions Act 2004 from the UKs Pension Protection Fund in respect of the shortfall. Such compensation is payable from the date when a qualifying insolvency event occurred. There are two possible dates in this case. The first possible date is 20 July 2010, which is when the trustees of the pension scheme presented a winding up petition in England. The winding up of a company under the Insolvency Act 1986 is a qualifying insolvency event: Pensions Act 2004, s 121(3)(g). English courts have jurisdiction to wind up a foreign company under the Insolvency Act 1986. However, under EU Regulation 1346/2000 on Insolvency Proceedings (the Regulation), where (as here) the company has its centre of main interests in another member state of the European Union, the English court is only permitted to wind it up if it has an establishment in England, meaning any place of operations where the debtor carries out a non transitory economic activity with human means and goods (article 2(h)). The second possible date is 2 October 2014, which is the fifth anniversary of the commencement of the proceedings in Greece. The possibility of treating this date as the date of a qualifying insolvency event in the specific circumstances of this case was created by a change in legislation subsequent to the Court of Appeals decision in this case refusing to make a winding up order on the basis of lack of jurisdiction: Pension Fund (Entry Rules) (Amendment) Regulations 2014. The trustees of the pension scheme would prefer compensation to be treated as payable from the earlier of those two dates, namely 20 July 2010. The only question for the court is therefore whether Olympic Airlines SA had an establishment in the UK on 20 July 2010 entitling the English court to make a winding up order under the Regulation, so that it can be said that a qualifying insolvency event occurred on that date. By 20 July 2010, Olympic Airlines SA had: closed all of its offices in the UK except for its head office at 11 Conduit Street in London; ceased all commercial operations; and terminated the contracts of all remaining UK staff except for the General Manager, the Purchasing Manager, and an accounts clerk, who were retained on short term ad hoc contracts to implement instructions from the liquidator in Athens, supervise the disposal of the companys assets in the UK, and pay bills and conduct other administration relating to the head office building. At first instance, the judge held that these activities constituted non transitory economic activities and Olympic Airlines SA therefore had an establishment in the UK entitling him to make the winding up order. The Court of Appeal disagreed and held that the remaining activity consisted only in the winding up of the companys affairs, which was not enough to give the court jurisdiction to make the order. The trustees of the pension scheme appeal from the Court of Appeals decision. The Supreme Court unanimously dismisses the appeal. Lord Sumption gives the only judgment. Lord Sumption holds that the Regulations definition of establishment, which must be read as a whole, envisages a fixed place of business and business activity carried on there consisting in dealings with third parties, and not merely acts of internal administration [13]. For example, disposal of stock in trade would clearly satisfy the definition, but mere internal administration of the winding up including administration of remaining premises in the UK would not [14]. Olympic Airlines SA was not carrying on business activity at its head office on 20 July 2010 and did not therefore have an establishment in the UK at that date [16]. The requirement of showing at least some subsisting business with third parties is acte clair and so no reference to the Court of Justice of the European Union is necessary [16].

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This is an interlocutory appeal in a criminal case which concerns the correct construction of section 92(1) of the Trade Marks Act 1994 (the 1994 Act). The appellants are a limited company and two individuals connected with its management. They are indicted for, inter alia, offences of unauthorised use of trade marks, contrary to section 92(1)(b) and (c) of the 1994 Act. No trial has yet been held, and the Crown case remains at this point a matter merely of allegation, which may or may not be proved. At a preparatory hearing in the Crown Court, they advanced a submission that part of what was alleged was, on any view, outside the terms of section 92 and no offence. Both the trial judge and the Court of Appeal (Criminal Division) rejected that submission. They renew it in this court. What is alleged is that the defendants are engaged in the bulk importation and subsequent sale of goods such as clothes and shoes. The goods, or many of them, are said to bear what appear to be the trade marks of well known brands, such as Ralph Lauren, Adidas, Under Armour, Jack Wills, Fred Perry or similar. The goods were manufactured abroad, in countries outside the EU. Some of the goods in the possession of the defendants are said to have been manufactured by people who were neither the trade mark proprietor, nor authorised by the proprietor to make them. This first category of goods, the appellants describe as counterfeits in the true sense. A significant portion of the remainder of the goods are, however, ones where there had originally been an authorisation of manufacture by the registered trade mark holder, whether by subcontract, licence or otherwise, but whose sale had not been authorised by him. They were thus sold, bearing the trade mark, without the consent of the owner of the mark. The causes of the non authorisation of sale might be, it is said, various. Some garments might deliberately have been made by the factories in excess of the numbers permitted by the trade mark owner, so that the balance could be sold for their own benefit. Some might have been made in excess of the order without that original ulterior intention (indeed perhaps as precautionary spare capacity planned and approved by the trade mark owner), but then have been put on the market without his consent. Some might have been made under a permission which was cancelled by the trade mark owner; that in turn might include cases where the trade mark owner was dissatisfied with the quality and not prepared to have the goods put on the market as if their own, but cancellation might not be limited to that cause. Those are not exhaustive of the possibilities. These latter various types of goods are described by the appellants as goods appearing on the grey market. It is common ground that neither the indictment nor the way the Crown puts its case distinguishes between these various different provenances. That led to submissions that the indictment would turn out either to be bad for duplicity or to be misleading, and at risk of producing verdicts which it was difficult to interpret. Thus was the point now at issue identified. In short, it is common ground that: (i) before there can be a criminal offence of unauthorised use of a trade mark there must be an infringement of that mark which would be unlawful as a matter of civil law; see R v Johnstone [2003] UKHL 28; [2003] 1 WLR 1736; and (ii) the sale, or the possession in the course of trade, of goods of any of the various provenances set out in para 5 above, would amount to an infringement of trade marks, giving rise to civil liability. But the appellants case is that whilst any of the various provenances set out would involve civil liability, it is only in the case of what they describe as true counterfeits that there is any criminal offence. They say that goods which were originally manufactured with the permission of the trade mark proprietor, but which are ones where he has not authorised the sale, are not true counterfeits and are not within the statute. Section 92(1) does not apply, they contend, to goods put on the grey market. The resolution of this contention depends on the true construction of section 92(1) of the 1994 Act. It says: 92. (1) A person commits an offence who with a view to gain for himself or another, or with intent to cause loss to another, and without the consent of the proprietor (a) applies to goods or their packaging a sign identical to, or likely to be mistaken for, a registered trade mark, or (b) sells or lets for hire, offers or exposes for sale or hire or distributes goods which bear, or the packaging of which bears, such a sign, or (c) has in his possession, custody or control in the course of a business any such goods with a view to the doing of anything, by himself or another, which would be an offence under paragraph (b). Subsection 92(5) adds a reverse onus statutory defence: (5) It is a defence for a person charged with an offence under this section to show that he believed on reasonable grounds that the use of the sign in the manner in which it was used, or was to be used, was not an infringement of the registered trade mark. The appellants contention focuses on the use of the expression such a sign in subsection (1)(b). That refers back, they say, to subsection (1)(a). And by referring back to (1)(a), they say, it means that (b) applies only to goods where the relevant sign (ie trade mark) has been applied without the consent of the proprietor. Any goods in the grey market category have had the trade mark originally applied with the consent of the proprietor. It is only the sale which the proprietor has not authorised. Therefore, they say, those goods are not ones to which paragraph (a) of the subsection could apply. It follows, they contend, that they are not, when it comes to paragraph (b), goods which bear such a sign. It may readily be agreed that the expression such a sign in section 92(1)(b) refers back to the sign described in the immediately preceding paragraph (a). The difficulty comes when one is asked to read such a sign as incorporating the words without the consent of the proprietor which appear in the first few lines of the section before (a), and also the requirement that the sign has been applied to the goods (without such consent), which is the central component of the offence under (a). This is simply not a possible construction of section 92(1). There is no difficulty, on the ordinary reading of paragraphs (a) and (b), in seeing what the reference back to such a sign in (b) imports from (a). Such a sign in (b) plainly means a sign such as is described in (a). The sign described in (a) is a sign which is identical to, or likely to be mistaken for, a registered trade mark. Signs (or trade marks) having any of the provenances described in para 5 above are squarely within this description. So called grey market goods are caught by the expression. The offences set out in paragraphs (a), (b) and (c) of section 92 are, as a matter of plain reading, not cumulative, but separate. It is not necessary that one has been committed (by someone) before one can say that the next in line has been. The mental element of a view to gain or the intent to cause loss is applicable to all three. So is the element that the use made of the sign is without the consent of its proprietor. Paragraph (a) then makes it an offence to apply such a mark, without consent and with the relevant mental element. Paragraph (b) makes it an offence to sell (etc) goods with such a mark, without the consent of the proprietor and with the necessary mental element. Paragraph (c) does the same for the preparatory offence of possession in the course of business with a view to behaviour which would be an offence under (b), again without the consent of the proprietor and with the relevant mental element. Subparagraph (c) thus involves anticipation (but not necessarily the commission) of an offence under (b). Of course, a person may commit all three offences, or different people may commit all three between them. But that is not necessary. Each stands alone. The appellants reading of paragraph (b) is, by contrast, strained and unnatural. It does not simply reach back to (a) but to the general words of the section which precede it. It requires one to read sign in (a), which is incorporated into (b), as which bears a sign, so applied, or at least as such a sign, so applied. This being so, there is no ambiguity or obscurity in the language such as would justify the court, pursuant to Pepper v Hart [1993] AC 593, in investigating the contents of Parliamentary debate at the time of the passage of the Bill which became the 1994 Act. Nor can it be suggested that the ordinary (or literal) reading of the Act gives rise to absurdity. It should be recorded, moreover, that the appellants realistically did not contend that there had been the kind of clear ministerial statement which amounted to a definitive identification of what the Bill was intended to achieve. The most that is contended for is that the passage of the Bill was marked by several references to the desirability of punishing counterfeiting. No doubt it was. But there is not suggested to be any point at which Parliament, or any individual speaker, confronted the suggested difference between fake goods (which the appellants here describe as true counterfeits) and grey market goods. Still less is there any point at which it can be suggested that Parliament plainly confined itself to criminalising fake goods and abjured the criminalising of grey market goods. In support of their contention that such a distinction was plainly intended, the appellants referred to observations made by Lord Nicholls and Lord Walker in R v Johnstone upon the differences between counterfeit goods, pirated goods, and bootlegged goods. Those observations arose, however, in the context of the case in which they were spoken. The defendant was charged with offences against section 92(1)(c). The offences were said to have arisen out of his possession for sale of compilation compact discs comprising songs which had covertly been recorded at concerts given by well known artistes. The compact discs referred to the artistes by name, track by track, and the artiste had in each case registered his name as a trade mark. The issue was whether the use of the name was, in the particular circumstances, one which might be taken by the buying public as an indication of authorised origin of the disc, as distinct from identifying the singer. That was a question of fact, but unless it was demonstrated that the use of the name would be taken as an indication of origin, there would be no civil liability for trade mark infringement, and the decision of the House was that in that event there could be no criminal liability either. It was in that context that Lord Nicholls referred at paragraph 1 to counterfeit goods as cheap imitations of the authentic article; that was said to distinguish that case from pirated music, which is music marketed without any trade mark, although recorded from a trade marked disc, and from bootlegged music, which is what Mr Johnstone had. Likewise, Lord Walker, at para 59, referred to counterfeiting as an expression generally used to include unauthorised sale, under a well known trade mark, of goods not made or authorised by the proprietor. Neither of their Lordships was addressing what is here said to be the critical difference between fake goods and unauthorised goods on the grey market. Their observations came, moreover, years after the passage of the 1994 Act, and could not have been in mind at the time of its passing. The appellants are correct that, in the context of goods which a proprietor voluntarily puts into the European single market with his trade mark attached, section 12 of the 1994 Act, transposing article 7 of Directive 89/104/EEC, has the effect that further objection to the use of the mark is limited to special cases, such as changes or impairments to the goods. But that is true whichever of the rival constructions of section 92 is correct. Where it applies, this concept of exhaustion means that there is no infringement of the mark as a matter of civil law, and thus no criminal offence. But this sheds no light on the correct construction of section 92. The appellants further drew attention to the wording of the predecessor of section 92, section 58A of the Trade Marks Act 1938. This had provided: 58A.(l) It is an offence, subject to subsection (3) below, for a person (a) to apply a mark identical to or nearly resembling a registered trade mark to goods, or to material used or intended to be used for labelling, packaging or advertising goods, or (b) hire, or distribute to sell, let for hire, or offer or expose for sale or goods bearing such a mark, or (i) (ii) material bearing such a mark which is used or intended to be used for labelling, packaging or advertising goods, or (c) to use material bearing such a mark in the course of a business for labelling, packaging or advertising goods, or to possess in the course of a business goods or (d) material bearing such a mark with a view to doing any of the things mentioned in paragraphs (a) to (c), when he is not entitled to use the mark in relation to the goods in question and the goods are not connected in the course of trade with a person who is so entitled. (3) A person commits an offence under subsection (1) or (2) only if (a) he acts with a view to gain for himself or another, or with intent to cause loss to another, and (b) he intends that the goods in question should be accepted as connected in the course of trade with a person entitled to use the mark in question; and it is a defence for a person charged with an offence under subsection (1) to show that he believed on reasonable grounds that he was entitled to use the mark in relation to the goods in question. This section provided, in subsection (3), for a more stringent test of mental element than does the present section 92. The appellants invite us to conclude that the earlier, more stringent, mental element may have had the practical effect of confining criminal liability to cases of their category of true counterfeits, and they say that a change in that effect is not demonstrated to have been intended by the 1994 Act. The difficulty with that is that whilst it is certainly true that the mental element was more stringent, the 1938 Act would still have caught so called grey market goods, for paragraph (1)(b) clearly applied to goods which were sold when sale was unauthorised, whether or not the original application of the mark had been permitted. Moreover, it is noticeable that the construction now contended for of section 92(1)(b) could not have been applied to section 58A(1)(b) without considerable difficulty, for the words giving effect to the element of absence of consent of the trademark proprietor did not appear at the beginning of the section as they now do, but only at the end; hence it would have been even more problematical to suggest that such a mark imported them. It is plain enough that the inversion of the order of the words was a grammatical rather than a substantive variation. Nor is there any reason to strain the language of section 92(1)(b) so as to exclude the sale of grey market goods. That is not because of the consequentialist arguments pressed on us by the Crown. It is doubtful that (absurdities or impossibilities apart) difficulties in assembling evidence can ordinarily affect the construction of a criminal statute. Moreover, some of the supposedly adverse consequences of such a construction which were put before us on behalf of the Crown would be as likely to ensue even on the correct interpretation of the Act set out above. The possible difficulty of distinguishing, where there has been an overrun, between the goods marketed with the proprietors authority and those which were a backdoor venture on the part of the manufacturer and subsellers, might as well arise on both constructions; no doubt in many cases the circumstances of the exit from the factory and of the subsequent sales will often be telling. Likewise it is far from clear that there will be greater difficulty occasioned by the appellants suggested construction than by the correct one in the case of convincing fakes. In both cases the defendant may occasionally be in a position to assert that he was taken in and thus reasonably believed that no infringement was involved. Such a defence, if advanced, must be met on its merits, which will no doubt involve investigation of, inter alia, the circumstances in which the defendant acquired the goods and the inquiries which he did or did not make. But, these consequentialist arguments apart, it is, on any view, unlawful for a person in the position of the defendants to put grey goods on the market just as it is to put fake ones there. Both may involve deception of the buying public; the grey market goods may be such because they are defective. The distinction between the two categories is by no means cut and dried. But both are, in any event, clear infringements of the rights of the trade mark proprietor. Defendants who set out to buy up grey market goods to make a profit on re sale do so because the object is to cash in on someone elses trade mark. If such be proved, they have scant claim to a beneficent construction of the Act. As it is, its ordinary reading plainly means that, unless they have the statutory defence, they have committed an offence. In the alternative, the appellants contend that the Crowns construction of section 92(1) involves a disproportionate breach of their rights under article 1, Protocol 1 to the European Convention on Human Rights. It may be accepted that it is perfectly possible that the imposition of a criminal sanction might be disproportionate where a civil law sanction is not. But persons in the position of these defendants have no proprietary right in the trade marks. They do have a right in the goods which they have bought, but the 1994 Act does not stop them selling them, except if they wish to do so whilst still with the misleading and infringing trade mark attached. The 1994 Act does not, therefore, deprive the defendants of any property which they have. The most it does is to regulate their use or the manner of their disposal of the goods, which is permitted under the second paragraph of article 1 in the general interest, which must include a general interest in the protection of trade marks. There is in any event nothing disproportionate in the 1994 Act penalising sales when the infringing trade mark is still attached, nor in imposing a criminal sanction on those who might otherwise calculate that the risk of liability in damages is worth taking. That is a perfectly legitimate balance to draw between the rights of the proprietor to protect his valuable trademark and goodwill, and those of the person who wishes to sell goods which he has bought. For these several reasons, these appeals must be dismissed and the trial may proceed accordingly.

This is an interlocutory appeal in a criminal case in which the appellants are defendants indicted for offences of unauthorised use of trademarks, contrary to section 92(1) of the Trade Marks Act 1994 (the 1994 Act). An offence is committed under that section where a person does any of the following three things (with the intent to gain or to cause loss, and without the consent of the trademark proprietor): (a) applies to goods a sign identical to, or likely to be mistaken for, a registered trade mark, (b) sells goods which bear such a sign, or (c) possesses in the course of a business any such goods with a view to committing an offence under (b). The allegations against the appellants (which have yet to be proved) are that they are engaged in the bulk import and subsequent sale of goods bearing registered trademarks, manufactured abroad, in countries outside the EU. A significant portion of the goods said to be sold by the appellants were manufactured (and the trademark applied) with the permission of the trademark proprietor, but were then sold without the trademark proprietors consent (for example because the goods were in excess of the numbers or below the quality permitted by the trademark proprietor). The appellant describes these as grey market goods and distinguishes them from true counterfeits manufactured without the authorisation of the trademark proprietor. At a preparatory hearing in the Crown Court, the appellants argued that while the sale of grey goods attracts civil liability, it is not covered by the offence in s.92(1), which properly construed applies only to true counterfeits. The appellants argued that such a sign in subsection (1)(b) refers back to (1)(a), so that 1(b) applies only to goods where the trademark has been applied without the consent of the proprietor. Any goods in the grey market category have had the trademark originally applied with the consent of the proprietor. It is only the sale which the proprietor has not authorised. It follows, they contend, that they are not, when it comes to paragraph (b), goods which bear such a sign. Both the trial judge and the Court of Appeal (Criminal Division) rejected that submission. The Supreme Court unanimously dismisses the appeals. Lord Hughes gives the lead judgment, with which the rest of the Court agrees. So called grey market goods are caught by the criminal offence in s.92(1), and the appellants contended construction of that section must be rejected. The plain reading of such a sign in (1)(b) is that it refers back to the sign mentioned in (1)(a) i.e. a sign which is identical to, or likely to be mistaken for, a registered trade mark. 1(b) therefore covers the unauthorised sale of any goods bearing a trademark (regardless of whether the trademark was applied to the goods in their manufacture with consent or not). But this reference back to (1)(a) does not also incorporate into the meaning of such a sign the commission of an offence under (1)(a), i.e. the requirement that the sign has been applied without the consent of the proprietor. Such a reading of (1)(b) is strained and unnatural and requires one to read such sign as such a sign, so applied. The offences set out in (a), (b) and (c) are not cumulative, but separate, and the requirement in the opening lines of s.92(1) that the use made of the sign is without the consent of the proprietor applies to each type of use specified whether it is the application of a trademark to goods, the sale of goods bearing a trademark, or the possession for sale of goods bearing a trademark. [8 12] The predecessor of section 92, section 58A of the Trademarks Act 1938, also plainly covered grey market goods. The appellants contention therefore that the more stringent test for intention in s.58A had the practical effect of confining criminal liability to cases of their category of true counterfeits must be rejected. [16 17] There is therefore no ambiguity in the language of the section to justify investigating the Parliamentary debate at the passing of the 1994 Act. In any event, the appellants did not contend that Parliament considered a difference between true counterfeits and grey market goods. Still less is there any point at which it can be suggested that Parliament plainly confined itself to criminalising fake goods and abjured the criminalising of grey market goods. The authorities relied on by the appellants in support of their contention that such a distinction was plainly intended do not assist here, as they were not addressing any difference between fake goods and unauthorised goods on the grey market, and moreover came years after the passage of the 1994 Act so could not have been in mind at the time of its passing. [13 14] The appellants are correct that in the context of goods which a proprietor voluntarily puts into the European single market with his trademark attached, section 12 of the 1994 Act, transposing article 7 of Directive 89/104/EEC, has the effect that further objection to the use of the mark is limited to special cases, such as changes or impairments to the goods. But that is true whichever of the rival constructions of section 92 is correct. Where it applies, this concept of exhaustion means that there is no infringement of the mark as a matter of civil law, and thus no criminal offence. But this sheds no light on the correct construction of section 92. [15] There is no reason to strain the construction of s.92(1) to exclude the sale of grey market goods. This is not because of the supposedly adverse consequences which the Crown argued would follow, some of which would be as likely to ensue even on the correct interpretation of the section. The distinction between the two categories suggested by the appellant is not cut and dried, but both are clear infringements of the rights of the trademark proprietor. The plain meaning of the Act is that it is unlawful to put grey goods on the market just as it is to put fake ones on there. In both cases the trader is setting out to profit from someone elses trademark without permission. [18] In the alternative, the appellants contend that the Crowns construction of section 92(1) involves a disproportionate breach of their rights under article 1, Protocol 1 to the European Convention on Human Rights. But the 1994 Act does not deprive them of their property, as it does not stop them selling the goods, except if they wish to do so whilst still with the misleading and infringing trademark attached. Such regulation of use or disposal of goods is permitted under the second paragraph of article 1 in the general interest, and is in any event a proportionate measure, striking a legitimate balance between the rights of the proprietor to protect his valuable trademark, and those of the person who wishes to sell good which he has bought. [19]

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Para 352D of the Immigration Rules provides for the grant of leave to enter to the child of a parent who has been admitted to the UK as a refugee. The issue in this case is whether the Para extends, or should be treated as extending, to a child for whom a family member has taken parental responsibility under the Islamic procedure known as Kafala (described in the agreed statement of issues as a process of legal guardianship akin to adoption). The facts are fully set out in the judgment of Davis LJ in the Court of Appeal. The following is a sufficient summary for present purposes. i) AA was born in Somalia on 21 August 1994. Her family was torn apart by events in Somalia. Her father was killed in the mid 1990s. ii) An elder sister, Ms A, married Mohamed on 10 January 2001. In 2002 she came home to find that he, her daughter Fadima, and her step daughter Amaani had been abducted. She eventually left Somalia and came to the United Kingdom in October 2002. She was later granted indefinite leave to remain, on compassionate grounds. Her husband had in the meantime escaped from his abductors and had gone to live elsewhere in Mogadishu. iii) AA became separated from her mother and other siblings during the fighting. Around the end of 2002 she went to live with Mohamed, Fadima and Amaani and was accepted as a family member. iv) In October 2007 Mohamed left Somalia, and came to the United Kingdom in November 2007, where he was reunited with Ms A. He was granted asylum on 21 July 2008. The three girls AA, Fadima and Amaani were left with a maternal aunt in Mogadishu. v) At the end of 2008 the three girls went to live with neighbours. Contact with Ms A and Mohamed was renewed in March 2009. Applications for entry into the UK were made for all three girls. Entry clearance was granted to Fadima and Amaani, who came to the United Kingdom on 22 January 2010. (I shall refer to them for convenience, and without legal implications, as AAs adoptive siblings.) It was refused for AA, who remained in Addis Ababa pending her appeal. vi) Her appeal was heard in the First tier Tribunal on 3 September 2010. Expert evidence, accepted by the tribunal, was to the effect that, although adoption as such does not exist under Islamic law, under the legal institution known as Kafala, a person may become a protg and part of the household of an adult; and that this only falls short of a full blown adoption in that such adoptee does not enjoy a right of inheritance under Islamic law (FTT para 21). vii) The tribunal allowed the appeal both under para 352D and article 8 of the European Convention on Human Rights, the former on the basis that AA falls into a specific category of persons who have been taken into guardianship or the care of others under a transfer of responsibility such that Islamic law would recognise the legal status of the appellant in relation to [Ms A and Mohamed] as their child for all purposes and in the circumstances in which the appellant was an orphan. (para 31) viii) On 23 May 2011, the Upper Tribunal (Judge Grubb) allowed the Secretary of States appeal in respect of para 352D, but confirmed the tribunals decision under article 8. On 14 May 2012 AA was given entry clearance and she arrived in this country on 4 June 2012. The Court of Appeal accepted that notwithstanding the grant of entry clearance under article 8, the appeal was not academic. The answer provided is that if entry is permitted under the Immigration Rules the entitlement of AA to remain thereafter will in effect align with the sponsor's entitlement, whereby indefinite leave to remain can be expected to be granted after the expiry of the five year period: whereas grant of leave to remain under article 8 is discretionary and not necessarily so linked to the sponsor's position. In this court, Mr Gill has provided further details of the differences, legal and practical, between clearance under the rules and discretionary leave to remain (DLR) under article 8. For example, under policies current at the time a person admitted under article 8 would take longer to reach the point of claiming indefinite leave to remain (ILR) than a person admitted under the rules. Mr Gill submits that DLR status is not easily understood by employers, educational institutions and others with whom the holder will need to have dealings in ordinary life. He pointed to other practical disadvantages, such as in relation to travel documents. Some of his points were contentious. However, it was not in dispute as I understand it that AAs status, following admission under article 8, might be materially less advantageous than that of someone (such as her adoptive siblings) admitted under Para 352D. The Rules The critical provision is Para 352D, in Part 11 of the Immigration Rules which relates to asylum: 352D. The requirements to be met by a person seeking leave to enter or remain in the United Kingdom in order to join or remain with the parent who is currently a refugee granted status as such under the immigration rules in the United Kingdom are that the applicant: (i) is the child of a parent who is currently a refugee granted status as such under the immigration rules in the United Kingdom; and (ii) is under the age of 18, and (iii) is not leading an independent life, is unmarried and is not a civil partner, and has not formed an independent family unit; and (iv) was part of the family unit of the person granted asylum at the time that the person granted asylum left the country of his habitual residence in order to seek asylum; The principal issue which arises in AAs case is whether her relationship with her brother in law Mohamed can be regarded as that of the child of a parent (under (i)). For that it is necessary to turn to the interpretation provision, Para 6, which defines parent as follows: a parent includes: (a) the stepfather of a child whose father is dead and the reference to stepfather includes a relationship arising through civil partnership; (b) the stepmother of a child whose mother is dead and the reference to stepmother includes a relationship arising through civil partnership and; (c) the father as well as the mother of an illegitimate child where he is proved to be the father; (d) an adoptive parent, where a child was adopted in accordance with a decision taken by the competent administrative authority or court in a country whose adoption orders are recognised by the United Kingdom or where a child is the subject of a de facto adoption in accordance with the requirements of Para 309A of these Rules (except that an adopted child or a child who is the subject of a de facto adoption may not make an application for leave to enter or remain in order to accompany, join or remain with an adoptive parent under Paras 297 303); (e) in the case of a child born in the United Kingdom who is not a British citizen, a person to whom there has been a genuine transfer of parental responsibility on the ground of the original parent(s)' inability to care for the child. Thus an adoptive parent under a de facto adoption is included, but subject to the requirements of Para 309A. This is underlined in turn by the definition of adoption: adoption unless the contrary intention appears, includes a de facto adoption in accordance with the requirements of Para 309A of these Rules, and adopted and adoptive parent should be construed accordingly. Para 309A is in Part 8 of the Immigration Rules relating to Family Members (in the particular group relating to children). Its present form dates from 2003. It provides so far as relevant: 309A For the purposes of adoption under Paras 310 316C a de facto adoption shall be regarded as having taken place if: (a) at the time immediately preceding the making of the application for entry clearance under these Rules the adoptive parent or parents have been living abroad (in applications involving two parents both must have lived abroad together) for at least a period of time equal to the first period mentioned in sub Para (b)(i) and must have cared for the child for at least a period of time equal to the second period material in that sub Para; and (b) during their time abroad, the adoptive parent or parents have: (i) lived together for a minimum period of 18 months, of which the 12 months immediately preceding the application for entry clearance must have been spent living together with the child; and (ii) have assumed the role of the child's parents, since the beginning of the 18 month period, so that there has been a genuine transfer of parental responsibility. Paras 310 316C (referred to in the opening words) form a group of Paras under the general heading Adopted Children, dealing with the general requirements for entry as an adopted child, unconnected with circumstances which might lead to an asylum claim. We were given little information about the thinking behind these rules, either in the present form, or as introduced in 2000. Before 2000 a more flexible approach had been applied. In R v Immigration Appeal Tribunal Ex p Tohur Ali [1988] 2 FLR 523, the Court of Appeal considered rule 50 as it then stood, under which parent was defined as including an adoptive parent, where there has been a genuine transfer of parental responsibility on the ground of the original parents inability to care for the child The court, by a majority, held that this expression was not confined to adoption under a legally recognizable adoptive process. Para 352D was originally introduced in October 2000, at the same time as the Human Rights Act 1998 came into effect. At that time the relevant part of the definition of parent in Para 6 included an adoptive parent but only where a child was adopted in accordance with a decision taken by a competent administrative authority or court in a country whose adoption orders are recognised by the United Kingdom (except where an application for leave to enter or remain is made under Paras 310 316). HC 538 of 31 March 2003 altered the definition of parent to its present form and introduced Para 309A. We were not given any explanation for these changes, but neither side relies on them as throwing any light on the issue we have to decide. Para 352D was considered by the Court of Appeal in MK (Somalia) v Entry Clearance Officer [2009] Imm AR 386. It had been argued that, notwithstanding the introduction of the new rule, reliance could be placed on a free standing policy, outside the rules, expressed in a Ministerial Statement dated 17 March 1995, under which following grant of asylum status to a parent reunion of the immediate family would be permitted as a concession outside the rules. The court held that this policy had been supplanted by the rules in their amended form. Discussion As I understand them, Mr Gills submissions, carefully and fully developed in his printed case and in oral argument, have three main strands: i) Construction To make sense of Para 352D in the context of the family of a refugee, the definitions must be interpreted broadly so as to include a child in the position of AA. ii) International obligations Effect must be given to the UKs international obligations relating to the treatment of children, including a broad approach to the recognition of adoptive children. iii) Discrimination Children who are members of a family unit should not be put at a disadvantage because they come from countries which have no formal system of adoption. Construction I would accept that the requirements of Para 309A (b)(i) and (ii) seem ill adapted to the purposes of Para 352D. They assume a degree of stability in the home country which is likely to be wholly inappropriate to those like AA seeking refuge from war torn Somalia, and indeed for most asylum seekers. Mr Eadie did not argue otherwise, although he suggested some theoretical scenarios in which the requirements might be achievable. As appears from its introduction the definition seems to have been designed principally to deal with ordinary applications to enter by adopted children, covered by the immediately following Paras. It finds its way into Para 352D by a somewhat circuitous route, which suggests that careful thought may not have been given to its practical implications. If there were any way in which we could legitimately rewrite the rule to produce a fairer result, I could see a persuasive case for doing so. Unfortunately I do not think this possible. The correct approach to construction of the rules is well settled, as explained by Lord Brown in Mahad v Entry Clearance Officer [2010] 1 WLR 48: The Rules are not to be construed with all the strictness applicable to the construction of a statute or a statutory instrument but, instead, sensibly according to the natural and ordinary meaning of the words used, recognising that they are statements of the Secretary of State's administrative policy the court's task is to discover from the words used in the Rules what the Secretary of State must be taken to have intended that intention is to be discerned objectively from the language used, not divined by reference to supposed policy considerations. (para 10) Read in accordance with those principles, it is clear to my mind that Para 352D does not cover AAs case, and cannot be rewritten in order to do so. Whether or not Kafala could be treated as a form of adoption for other purposes, the definition of adoptive parent in Para 6 is more restricted. It extends to de facto adoption only within the limitations laid down by Para 309A, which do not cover this case. Although in terms directed to the succeeding provisions, the definition is also incorporated specifically into the general definition of adoptive parent and hence into that of parent in Para 6. Mr Gill sought to make something, first, of the fact that the definition of parent is expressed as inclusive, and, secondly, of the words unless the contrary intention appears in the definition of adoption. Neither point assists. The word includes in the definition of parent is readily explicable, having regard to the fact that the particular Paras do not include a biological parent. They are rather designed to extend the natural meaning of the term. The specific treatment of adoption in Para (d) excludes any intention to cover other forms of de facto adoption outside the definition. Similarly, the reference to contrary intention in the definition of adoption, in context, cannot be read as designed to extend the scope of the definition, but rather to indicate that there may be contexts in which the extension to de facto adoption does not apply. On this aspect, I cannot usefully add to the reasoning of Davis LJ said in the Court of Appeal. As he said, the wording of the rules is plain and unambiguous. International obligations Mr Gill has referred us to a number of international instruments which call for a broad approach to the protection of the interests of children. As he rightly says, the best interests principle is now, in appropriate areas of law, recognised both by domestic and international law (see ZH(Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166). Without in any way detracting from the importance of the principles affirmed in those instruments, I do not find it necessary to review them in any detail. Taking them at their highest, Mr Gill is unable to point to any specific obligation covering the position of someone in the position of AA in the present case. LJ concluded: In response to similar submissions in MK (Somalia) (above), Maurice Kay Do these documents establish or evidence an obligation of customary international law that is positively protective of de facto adopted children? In my judgment they do not. At best they illustrate an increasing awareness of the need for a flexible approach to the concept of family but they do not address in terms the question of de facto adoption which, because of its very lack of formality, presents a receiving state with obvious problems of verification. There is no material referred to by Mr Pleming which demonstrates a clear international consensus about the particular problem of de facto adoption quite the contrary. Whilst there is a perceptible concern that the concept of family, in the context of family reunion, should not be resistant to social and cultural change, I do not consider that there is a precise, identifiable obligation of customary international law that is prescriptive of the national approach to de facto adoption. (para 12) I respectfully agree. Mr Gill also referred us to Secretary of State for Home Department v Abdi [1996] Imm AR 148. The Court of Appeal noted a Home Office letter dated 17 May 1990 relating to Somali Family Reunion Applications, which included the following: 8.1.1 If the United Kingdom sponsor has been recognised as a refugee here under the terms of the 1951 United Nations Convention relating to the Status of Refugees then, like most countries, we follow the policy on family reunion agreed by the Conference which adopted the Convention. We will agree to the admission of the spouse and minor children of the refugee. However given the nature of the Somali family we are prepared to be flexible and if a refugee is able to show that a person not covered by the policy was a dependent member of the refugee's immediate family unit before the refugee came to the United Kingdom, then we would be prepared to consider exceptionally extending the refugee family reunion provision to cover that person. Although this is a clear recognition of the importance attached internationally to family reunion, it is equally clear that the more flexible approach proposed for Somali applicants is not treated as a matter of legal obligation, but as a matter for exceptional consideration. In that respect Mr Gill faces a further difficulty. It is accepted by the Secretary of State that the rules on this issue are not exhaustive of this countrys obligations under international law. Hence the decision to allow AA entry under article 8 of the European Convention on Human Rights. Subject to the issue of discrimination, to which I will come, Mr Gill is unable to point to any international obligation which goes further in practical terms than the protection which has been afforded to AA under human rights law. Discrimination Mr Gill relies on what he calls the principle of non discrimination as recognised in a number of international instruments, for example: i) UN Convention on the Rights of the Child article 2, under which states parties are required to ensure the rights in the Convention to each child within their jurisdiction without discrimination of any kind ii) The Refugee Convention, the preamble of which reaffirms the principle that human beings shall enjoy fundamental rights and freedoms without discrimination iii) The European Convention on Human Rights article 14, under which the rights set out in the Convention are to be secured without discrimination on any of the grounds there set out. Mr Gill submits that the discrimination in this case arises on a number of grounds under article 14, including race, religion and nationality, and also (as he puts it in his printed case) other status (the statuses of being a child of a refugee and/or of being a de facto adopted child, ie a child who is not a biological child nor a child adopted in accordance with procedures recognised by the UK.) I accept that it appears harsh, to put it no higher, that under the rules AA is treated less favourably than her adoptive siblings, largely because of the tragic circumstances in which parental responsibility passed to her brother in law, taken with the lack of any functioning legal system allowing for formal adoption in the country from which she comes. It is however unnecessary to decide in the context of the present appeal whether or not such treatment could give rise to a claim for unlawful discrimination under article 14 or otherwise. This is because any rights which AA has in that respect would apply equally to her position in this country, regardless of the basis of her admission. Mr Gill did not suggest otherwise. In exercising any discretion in relation to the grant or extension of DLR, the Secretary of State is obliged to act in conformity with the Convention, including article 14. It is not necessary to reinterpret the rules to achieve that result. I would add one comment. As I have made clear, I see great force in Mr Gills criticisms of the use of the Para 309A definition in the context of a rule which is concerned with the treatment of refugees and their dependants. Mr Eadies only answer, as I understood him, was that clear definitions were needed to establish bright lines. That answer loses most of its force if the bright lines are drawn so restrictively that they have in practice to be supplemented by the much fuzzier lines drawn by article 8. In the interests of both applicants and those administering the system, it seems much preferable that the rules should be amended to bring them into line with the practice actually operated by the Secretary of State, including that dictated by her obligations under international law. Conclusion For these reasons, which substantially follow those of the Court of Appeal, I would dismiss this appeal.

The issue in this appeal is whether AA falls within the definition of an adopted child in paragraph 352D of the Immigration Rules. AA was born in Somalia on 21 August 1994. Her family were torn apart by events in Somalia and her father was killed in the mid 1990s. AA became separated from her mother and other siblings during the fighting. Around the end of 2002, she went to live with her brother in law, Mohamed. He had a daughter, Fadima and step daughter, Amaani. Mohamed took AA into his family home under the Islamic procedure known as Kafala (described as a process of legal guardianship akin to adoption). In October 2007, Mohamed left Somalia and came to the UK in November 2007. He was granted asylum on 21 July 2008. The three girls, AA, Fadima and Amaani, were left with a maternal aunt in Mogadishu. An application for entry into the UK was made for all three girls. Entry clearance was granted to Fadima and Amaani who came to the UK in January 2010. It was refused for AA who remained in Addis Ababa pending her appeal. Her appeal was heard in the First tier Tribunal (FTT) on 3 September 2010. Exert evidence, accepted by the tribunal, was to the effect that, although adoption as such does not exist under Islamic law, under the legal institution known as Kafala a person may become a protg and a part of the household of an adult; and that this only falls short of a full blown adoption in that such adoptee does not enjoy a right of inheritance under Islamic law. The FTT allowed the appeal both under paragraph 352D and article 8 ECHR (right to respect for private and family life). The Secretary of State appealed. The Upper Tribunal (UT) allowed the Secretary of States appeal in respect of paragraph 352D but confirmed the FTTs decision under article 8. On 2 May 2012, the Court of Appeal confirmed the UTs decision. On 14 May 2012, AA was given entry clearance and she arrived in the UK on 4 June 2012. AA appeals to the Supreme Court in respect of paragraph 352D of the Immigration Rules. The Supreme Court dismisses the appeal. Lord Carnwath gives the lead judgment, with which Lady Hale, Lord Wilson, Lord Reed and Lord Hughes agree. The correct approach to construction of the rules is well settled, as explained by Lord Brown in Mahed v Entry Clearance Officer [2010] 1 WLR 48. Read in accordance with those principles, it is clear that paragraph 352D does not cover AAs case and cannot be rewritten in order to do so [14 15]. Whether or not Kafala could be treated as a form of adoption for other purposes, the definition of adoptive parent in paragraph 6 is more restricted. It extends to de facto adoption only within the limitations laid down by paragraph 309A, which does not cover this case [15 16]. A number of international instruments call for a broad approach to the protection of the interests of children. The best interests principle is now, in appropriate areas of law, recognised both by domestic and international law [17]. However, taking them at their highest, there is no specific obligation covering the position of AA [18]. Subject to the issue of discrimination, there is no international obligation which goes further in practical terms than the protection which has been afforded to AA under human rights law [21]. It appears harsh that under the rules AA is treated less favourably than her adoptive siblings, largely because of the tragic circumstances in which parental responsibility passed to her brother in law, taken with the lack of any functioning legal system allowing for formal adoption in the country from which she comes. However, it is unnecessary to decide in the context of the present appeal whether or not such treatment could give rise to a claim for unlawful discrimination under article 14 ECHR or otherwise. This is because any rights which AA has in that respect would apply equally to her position in this country, regardless of the basis of her admission. In exercising any discretion in relation to the grant or extension of definite leave to remain, the Secretary of State is obliged to act in conformity with the Convention, including article 14. It is not necessary to reinterpret the rules to achieve that result [24].

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The council appeals against the decision that it is liable to pay compensation under section 106 of the Building Act 1984, for loss to a business on Hastings Pier arising from its closure during 2006 under the councils emergency powers. The respondent (Manolete) pursued the claim as assignee of Stylus Sports Ltd (Stylus), which owned and operated the business at the relevant time, but went into liquidation in late 2011. The only issue in the appeal is whether Stylus was itself in default within the meaning of that section, so precluding it from making a claim. The statutory provisions As explained more fully by Jackson LJ in the Court of Appeal ([2014] 1 WLR 4030, [2014] EWCA Civ 562, 46 paras 46ff), the 1984 Act is one of a sequence of public health statutes, going back to the 19th century, which among other matters have dealt with the regulation of new buildings and the control of dangerous structures. The 1984 Act draws together a number of such provisions, including building regulations (Part I), supervision of construction work other than by local authorities (Part II), and Other provisions about buildings (Part III). Within Part III, and relevant to this case, are section 77 (Dangerous building) and 78 (Dangerous building emergency measures). Section 77 enables the council to apply to the magistrates court in relation to a building or structure which is in such a condition, or is used to carry such loads, as to be dangerous. Under subsection (1), the court may either (a) where danger arises from the condition of the building or structure, order the owner to execute work necessary to obviate the danger or to demolish it, or (b) where danger arises from overloading of the building or structure, make an order restricting its use until a magistrates court, being satisfied that any necessary works have been executed, withdraws or modifies the restriction. By section 77(2)(b) if the person against whom an order is made under subsection (1)(a) above fails to comply with the order within the time specified, the local authority may execute the order and (b) recover the expenses reasonably incurred by them in doing so from the person in default. Under section 78 (directly relevant to this case), where it appears to the authority that a building or structure or part of it is in such a state, or is used to carry such loads, as to be dangerous, and that immediate action should be taken to remove the danger, they may take such steps as may be necessary for that purpose, having given notice if reasonably practicable to the owner and occupiers. Compensation is governed by section 106 (in Part IV of the Act): (1) A local authority shall make full compensation to a person who has sustained damage by reason of the exercise by the authority, in relation to a matter as to which he has not himself been in default, of any of their powers under this Act. (emphasis added) By section 106(2) any dispute arising as to the fact of damage, or as to the amount of compensation is to be determined by arbitration. section 106 must be read with section 78(7): In the context of a claim resulting from emergency action under section 78, (7) Where in consequence of the exercise of the powers conferred by this section the owner or occupier of any premises sustains damage, but section 106(1) below does not apply because the owner or occupier has been in default (a) the owner or occupier may apply to a magistrates court to determine whether the local authority were justified in exercising their powers under this section so as to occasion the damage sustained, and (b) if the court determines that the local authority were not so justified, the owner or occupier is entitled to compensation, and section 106(2) and (3) below applies in relation to any dispute as regards compensation arising under this subsection. The default on which the council relies includes alleged breaches (actual or prospective) of the duties imposed by the Occupiers Liability Act 1957 and the Health and Safety at Work etc Act 1974. In short the former (by section 2) imposes on occupiers of premises the common duty of care; that is a duty to take such care as in all the circumstances of the case is reasonable to see that the visitor will be reasonably safe in using the premises for the purposes for which he is invited or permitted by the occupier to be there. The latter, by section 2, imposes on an employer the duty to ensure, so far as is reasonably practicable, the health, safety and welfare at work of all his employees, and in particular to maintain any place of work (including means of access and egress) in a condition that is safe and without risks to their health. The facts The history of the pier structure is described in the report by engineers for the council (the Gifford report) in June 2006, which led directly to their decision to close the pier: The original Hastings Pier was opened in 1872. It was built to a length of 277m with its timber deck bearing on wrought iron lattice trusses, all supported on three rows of cast iron screw piles via cast iron columns; the columns were braced with wrought iron ties secured with cast iron clamps. The width varied from 13.6m at the Central Section to 60m at Head and 39.6m at the landward end. Repairs utilising steel trusses and steel columns have been undertaken at various times since following a fire in 1917 to the Pier Head, partial demolition (sectioning) and actual bomb damage during the 1939 45 war, and widening to both sides of the Pier They commented on the general state of the pier: Experience has shown the typical life of Victorian piers to be approximately 100 years; during this time continual maintenance would have been required, including the replacement [of] some critical elements. After this time, major reconstruction works would be required if continued use of the pier were to be viable. The general condition of Hastings Pier fits this pattern. In recent years the freehold of the pier was owned by Ravenclaw Investments Incorporated (Ravenclaw), a company registered in Panama, and managed on their behalf by Boss Management UK Ltd (Boss). Stylus occupied two units, C2 and C15, close to the entrance to the pier at the northern (town) end. They operated a bingo hall in unit C2 and an amusement arcade in unit C15. The units were held respectively under leases from Ravenclaw dated 14 August 2001 and 10 October 2001. The premises as so leased were confined generally to the internal non structural walls, and internal surfaces, and specifically excluded any main structural parts of the premises or of the building (Schedule 1). Ravenclaw as landlord was responsible for repair and when necessary renewal of the structure including the support structure of the pier. In 2004 Stylus became concerned about the structural integrity of the pier. They commissioned a full structural engineering survey of the pier by Hamill Davies Limited. The report (the HDL report), produced in September 2004, was provided both to Ravenclaw and in January 2005 to the council. It advised that urgent work was required to repair piles at the far end of the pier (some distance beyond the Stylus units). This should be done ideally within the next two months to avoid the worst of the winter weather; and the deck area supported by these piles should be closed to the public until this work is completed. They also advised that future work should be carried out to the structure of the pier in the area of the Stylus units. Of this they said: With regard to the remaining work it is understood that this cannot be undertaken immediately. However this work should be completed within one year, with regular monitoring of the defective areas until this can be achieved. Unless this is carried out we judge there to be an unacceptable risk to the public. There is no evidence of action by Ravenclaw or the council to remedy the structural defects in response to this report, other than some limited work by Ravenclaw in the winter of 2005 2006. Meanwhile the public continued to use the pier, and the pier facilities (including the bingo hall and the amusement arcade) remained open for business. In early April 2006 a council officer inspected the underside of the pier, when a section of tension cord fell from the pier. The council commissioned Gifford to report on the structural stability of the pier. Their brief included appraisal of its structural integrity and any potential risks to the public. The areas chosen were those that would be subjected to the greatest crowd loading in the event of mass evacuation of the buildings, ie the designated escape routes (report para 1.3). In May 2006 the council tried without success to compel Ravenclaw to commission a full structural assessment of the Pier. On 15 June 2006 they asked Boss, as agents for Ravenclaw, to close off the pier beyond the front facade, but that request was not complied with. The Gifford report, received by the council on 16 June 2006, identified serious structural defects, and recommended a full structural survey as a matter of urgency. It recommended by way of immediate restrictions a) Access resulting in the potential for crowd loading on the Central Section and beyond should be prohibited until either, as a minimum, the presently identified defects in the area of the Central Section bounded by Columns 197 216 211 200 have been rectified or alternative safe access routes have been provided. b) Access by shop tenants or others for the purpose of maintenance need not be restricted. (para 6.1) The columns there identified were beneath the Stylus premises. On 16 June the Council exercised its emergency powers under section 78 of the 1984 Act to close the pier to the public from the front facade onwards. A barrier was erected across the frontage with a notice saying danger keep out. A letter was delivered on the same day to tenants of units on the pier stating that the pier was being closed from the main entrance building onwards, including the Bingo Hall and Amusement arcade. The letter indicated that the council had had concerns about the pier for some time and had served notice on the owners requiring them to carry out a survey of the structure. It continued: In recent days the council has become aware that major events were still being booked for the Pier ballroom; two of these have been booked for July and one in August. As a result of its concerns over the Pier structure the Council commissioned consulting engineers Gifford of Southampton to look at a specific area of concern under the main covered walkway around the main facade entrance. This inspection was carried out yesterday. It has been established that at least five trusses have failed in this area. Our consultant is of the opinion that it is unsafe to allow large numbers of people onto the Pier. This area provides the only method of access onto and off the Pier. Any emergency affecting the rest of Pier, including the ballroom, requiring evacuation would mean crowds of people walking over the area where we have been specifically advised that crowds are unsafe. As a result the council has had no option other than to use its emergency powers to close much of the Pier immediately. The letter noted that, despite previous attempts to resolve the situation, the Pier management were continuing to plan for large events. On the same day the council applied to Hastings Magistrates Court under section 77(1)(b) of the 1984 Act. The initial hearing at the Magistrates Court took place on 21 June 2006. A representative of Stylus attended and asked to be included in the proceedings. After adjournments, at the substantive hearing on 12 September the court made an order under that section prohibiting public access to the pier until the necessary remedial works had been carried out. Meanwhile, in July 2006 Stylus instructed HDL to undertake an inspection of the area beneath its units. It also instituted proceedings against Ravenclaw to require them to carry out the works of repair under the lease, and obtained summary judgment, but that was not complied with by Ravenclaw. In May 2007 Stylus began itself to carry out the necessary remedial works under its own premises. Those having been completed, the magistrates court on 4 July 2007 varied its order so as to permit public access to its premises. On 8 November 2006 Stylus had notified the council of its intention to claim compensation under section 106(1) of the 1984 Act, for losses allegedly suffered as a result of the closure of the pier between 16 June and 12 September 2006. In late 2011 Stylus went into liquidation, and in January 2012 the liquidator of Stylus assigned Stylus claim against the Council to Manolete, the present respondents. The present proceedings in the Technology and Construction Court (begun under CPR Part 8, on the basis that there would be no substantial dispute of fact) sought a declaration that the council were liable to pay compensation: [2013] EWHC 842 (TCC); [2013] 2 EGLR 17. The proceedings below Before Ramsey J the council raised a number of defences including the one now in issue, which he summarised: That the Council is not liable under section 106 of the 1984 Act because the claimant was in default for the purposes of that section because of the breach of section 2 of the Occupiers Liability Act 1957 and/or because it took a lease of the Pier past the end of its design life from a company registered outside the jurisdiction and was aware by the very latest in 2004 that there were serious problems with the structure of the Pier but took no adequate steps to ensure the Pier was repaired or the public excluded. (para 14) He noted that in submissions the council had relied also on the duties under the Health and Safety at Work etc Act 1974. He rejected the defence, holding that the reference to default should be read as default in respect of obligations imposed by the 1984 Act itself. In support he cited authorities under previous statutes using the same expression, in particular Neath Rural District Council v Williams [1951] 1 KB 115. He added: If that is not so and if it were necessary to see whether a party was in breach of any provision of other statutes, as is submitted here, then the scope of enquiry would be large and would require investigation of further factual matters to determine whether there was a default in terms of those statutes. (para 46) He also rejected a separate defence that, absent section 78, Stylus would have had no action in tort in any event. That is no longer in issue. In the Court of Appeal [2014] 1 WLR 4030 Jackson LJ agreed that default was limited to default under the 1984 Act. He reviewed at length the legislative history, dating from the Metropolitan Buildings Act 1844. He noted that compensation provisions, substantially in the same form as section 106, had appeared in the Public Health Acts of 1875 and 1936. He referred to Hobbs v Winchester Corpn [1910] 2 KB 471, which he read as treating the words in default as directed to default under the Act of 1875. However, he accepted the submission of counsel for the authority that in both the 1875 and 1936 Act it should be read as extending also to related statutes: He points out that in many instances a building owner would be in breach of local Building Acts and Improvement Acts. If the local authority intervened in order to protect public safety, it would be absurd if the building owner could recover compensation under section 308. I accept that submission. In my view the default proviso in the 1875 Act was referring to a default under the 1875 Act or related Acts. (para 52 emphasis added) However, the same extension was not required under the 1984 Act, because There are no local byelaws or parallel statutes directed to the same subject matter as the 1984 Act. The 1984 Act and the Regulations made under it are comprehensive. (para 76) A narrow construction was supported also by looking at the statute as a whole: Where the same phrase occurs more than once it should generally be construed in the same way on each occasion The phrase in default occurs in three significant places in the 1984 Act, namely in section 77(2)(b), section 78(7) and section 106(1). In both sections 77(2)(b) and sections 78(7) default has a narrow meaning. It clearly refers to a failure to perform obligations under the 1984 Act. This circumstance is a pointer towards construing default in section 106 narrowly, namely as meaning breach of an obligation under the 1984 Act. (paras 74 75) In agreement with the judge he concluded: The phrase in default in section 106 of the 1984 Act means in breach of an obligation arising under the 1984 Act. The provision does not require the court or the arbitrator to conduct a wide ranging review of other legislation and the common law in order to see whether the claimant is in breach of any duties arising outside the 1984 Act. (para 79) The court had some sympathy for the argument that the council should not be obliged to compensate Stylus for being prevented from admitting the public to dangerous premises. But, given that the true culprit Ravenclaw was beyond the reach of enforcement procedures, the court was faced with the familiar problem of deciding which of the surviving parties should bear the loss, the answer to which depended on the statutory scheme. He added: [Stylus] has acted responsibly at all stages. It did its utmost to compel the landlord to carry out remedial works. Ultimately it stepped into the breach and did the works itself. If the local authority had wished to avoid liability to pay compensation under section 106, it could have brought proceedings under section 77 of the 1984 Act sooner and thereby avoided the need to take emergency action under section 78. Finally, on this point, [the councils] general arguments will still be available at the quantum hearing before the arbitrator. The local authority will be entitled to argue that even if it had not fenced off the pier, [Stylus] could have made little use of its two units. (paras 81 82) Finally he considered and rejected a separate argument on behalf of the council that the claim was precluded by the ex turpi causa principle, on the basis that to admit the public would have been contrary to its statutory responsibilities: the motivation for the local authoritys closure of the pier to the public on 16 June 2006 was the likelihood of large crowds accessing the pier on and after 17 June for reasons unconnected with [Stylus] business. As at 16 June 2006 [Stylus] had not incurred liability to any member of the public for breach of the Occupiers Liability Act 1957. Nor can I see any basis for saying that [Stylus] had committed any breach of the statutory duties which it owed to its employees under the Health and Safety at Work etc Act 1974 . (paras 91 92) In his view, the default proviso was the control mechanism which eliminates claims that are unacceptable on grounds of public policy. It left no room for the application of the ex turpi causa rule (para 94). He added: 95. Having said that, I do accept that the structural condition of the pier will be relevant to the quantum of the claim. The local authority will be entitled to argue in the arbitration due to be held under section 106(2) that the loss of profit caused by the local authoritys conduct must be substantially reduced by reason of the structural condition of the pier. Indeed the local authority would be entitled to argue that the quantum is reduced to nil, although on the evidence which I have seen that outcome seems unlikely. The submissions in summary In this court Mr Gasztowicz QC for the council submits that the courts were wrong to treat the word default as confined to default under the 1984 Act. That is supported both by ordinary meaning of the word and by the legislative history. The authorities referred to by the judge and the Court of Appeal do not lead to a different conclusion. Stylus was in default in the relevant sense because it was in breach of its obligations under the 1957 Act and 1974 Acts in relation to the very matter in relation to which the statutory power was exercised, namely the admission of the public to premises which when they were admitted were dangerous (to them and employees) (printed case p 30) He relies in particular on Stylus own evidence which showed that: i) It had received the September 2004 HDL report showing that urgent repairs were necessary to protect the public, including work in the Stylus area of the pier, which if not carried out within at most a year from September 2004 would mean there would be an unacceptable risk to the public; ii) No further report had been obtained giving a different assessment on the state of the Pier in this area two years on; iii) Notwithstanding the contents of the report the necessary work was not done prior to closure. Although the primary responsibility for repair lay with the freeholders, Stylus had the ability to carry them out in default (Granada Theatres Ltd v Freehold Investment (Leytonstone) Ltd [1959] 1 Ch 592, 608), as indeed it did following the court order. By continuing to invite the public to its premises it was causing loading by the public resulting in them and its employees being made subject (in the words of the HDL report) to unacceptable risk. For Manolete, Mr Bowdery QC (who did not appear below) supports the view of the courts below on the interpretation of the word default, but submits also that the appeal fails on the facts. As the Court of Appeal held, the council was unable to show that Stylus was in default of any legal obligation under either of the statutes relied on or otherwise. Furthermore, there was nothing to show that the council had ever regarded Styluss use of its own premises as dangerous to the public or its employees, following its receipt of the HDL report in early 2005. As the correspondence showed, and the Court of Appeal found, the motivation for the use of emergency powers was the prospect of large crowds at events unconnected with the use of the Stylus premises. Discussion With respect to the courts below, while recognising the somewhat different emphasis of the arguments in this court, there is a danger of over complication. If one takes the words of section 106(1) at face value, they do not appear to pose any great difficulty either of interpretation or of application to the facts of this case. The section gives a right to compensation to a person who has sustained damage by reason of the exercise of any of the authoritys powers under the Act in relation to a matter as to which he has not himself been in default. This raises two questions: Is that a matter as to which the claimant has been in default? i) What was the matter in relation to which the authority has exercised its powers? ii) It is important to keep in mind that the relevant power is the power to take emergency action under section 78. The claim is for loss resulting from that emergency action, not from the order of the magistrates court, which itself carries no right to compensation. That is why the claim is limited to the period from the date of closure until the order made on 12 September. This point gains emphasis from section 78(7). Even a claimant in default (in the relevant sense) is not precluded from seeking compensation, if the court determines that the authority were not justified in using their emergency power, rather than first seeking an order from the magistrates under section 77. The right to compensation provides an important check on the unbridled use of that emergency power under section 78, in respect of which (unlike section 77) there is no right of objection or recourse to the court. The councils decision to act under section 78 in this case is not itself in issue. But it is necessary to identify the matter which led it to take such emergency action, rather than applying first to the magistrates court. That is clearly identified by the evidence, in particular the letter sent to the tenants at the time. It was not the general state of the pier, nor even the specific repairs identified in the HDL report on which Mr Gasztowicz relies. The council had been aware of those matters at least since the receipt of that report in 2005, but had not thought it necessary to close the pier, nor to take any legal action against Stylus at that stage. If they had wished to do so, there appears no reason why they could not have applied to the court for the appropriate order, giving Stylus the opportunity to make representations. No issue of compensation would have then arisen. As is clear from the councils letter to tenants, the matter which triggered the action in June 2006 was the state of the pier combined with fear of possible collapse from crowd loading during the events planned for that month, particularly the risk of overloading in an emergency evacuation. Stylus was not legally responsible for the state of the pier, nor was it responsible for the events which triggered the councils action. Whatever may have been its position as respects its clients and employees, it was not in default as to the matter which led to the councils use of section 78. On this simple basis, in my view, the company is entitled to succeed. That conclusion makes it strictly unnecessary to address the view of the courts below that default in section 106 referred only to default under the 1984 Act itself. However, the council, no doubt supported by others with like responsibilities, is understandably concerned as to the potential implications of this limitation for future cases. There seem to have been four main points leading to this conclusion: (i) the legislative history, (ii) other references to default in the 1984 Act, (iii) the wide scope of the factual inquiry implicit in the alternative approach, and (iv) various authorities under the predecessor statutes. None of these considerations in my view supports the conclusion. The first three points can be dealt with shortly. The legislative history tends if anything to support the opposite view. The use over more than 100 years of the same formula in statutes which, though covering the same general subject matter, included a varying range of powers, makes it unlikely that it was linked specifically to the particular provisions of each statute. Jackson LJ was forced to accept that the similar formula in the Public Health Acts 1875 (section 308) and 1936 (section 278) must be read as extending to default under related Acts, such as local Building Acts and Improvement Acts (paras 52, 55). I agree, but related is an imprecise term, not supported by anything in the wording of the section itself. Once that extension is accepted, it is difficult to understand why it should not extend to other forms of legal default. Secondly, the other references to default referred to by Jackson LJ do not assist. In section 77(2)(b), the default in question is specified by the section itself, that is failure to comply with the magistrate courts order. That throws no light on its meaning where it is not so limited. Section 78(7) is related directly to section 106 and poses the same issue as is now before us. Thirdly, the courts concern as to the wide ranging nature of the factual inquiry implied by the authoritys suggested approach is understandable, but it does not arise if the inquiry is limited in the way I have suggested above. As to the authorities, the only one referred to by the Court of Appeal was Hobbs v Winchester Corpn [1910] 2 KB 471, which related to the equivalent compensation provision in the 1875 Act (section 308). Meat had been seized under section 116 of the 1875 Act as unfit for human consumption. Although the butcher was acquitted of any offence under section 117 of that Act, on the grounds that he was unaware that it was unfit for consumption, it was found that he was nonetheless in default for the purpose of section 308, so that his claim for compensation failed. Since the only default relied on by the authority was default under the 1875 Act, that case throws no light on the nature of the default which might be relevant in other cases. Mr Bowdery relies also on Place v Rawtenstall Corpn (1916) 86 LJKB 90, under a provision in a local Act giving the authority a defence from civil liability for damage caused in exercise of their statutory powers in default of the owner or other person required to do such work, and in the absence of negligence: section 257 of the Rawtenstall Corporation Act 1907 (emphasis added). The authority had served notice under that Act requiring the claimant to convert a pail closet on his premises into a water closet and to connect it to a sewer. He failed to comply, and the authority carried out the work themselves, but did so by carrying out a larger project serving some other houses. In doing so, they used pipes larger than would have been needed by the claimant, thus causing subsidence to his property. It was held that the authority could not rely on his default to defeat his claim for damages. The judgment confirmed the essential principle that statutes interfering with common law rights should be strictly construed, and that it was for the authority to establish that the work which they have done is strictly work done in default of the owner. The problem for the authority was that the work was not limited to the work the owner would have done to carry out the work for his own house, but comprised much more. There was no finding that the damage was only caused by the work which Mr Place was required to do (pp 92 94 per Scrutton J). That seems to me a decision turning on its own particular facts, which throws no light on the meaning of the word default in the present context. I should also mention two authorities referred to in argument on the word default in the provisions relating to statutory nuisances under the 1875 and 1936 Acts. Clayton v Sale Urban District Council [1926] 1 KB 415 concerned action by the authority in respect of an alleged statutory nuisance caused by flooding. Under section 94 of the 1875 Act they could serve an abatement notice on the person by whose act default or sufferance the nuisance had arisen. The authority argued that the nuisance had arisen by the default of the owner, in failing to repair the bank. It was argued that there could not be default by the owner within the meaning of the section unless there had been a breach of an obligation arising independently of the section from an agreement or otherwise, and that he was not under any agreement or covenant or otherwise to construct or to repair the flood bank (pp 423 424). This argument was rejected. Lord Hewart CJ said: In my opinion the act, default, or sufferance referred to in section 94 of the Public Health Act 1875, is an act, default, or sufferance related to the nuisance which it is sought to abate, and default no less than sufferance within the meaning of that section can occur without the breach of an obligation arising from contractual agreement. (p 425) He referred to the common law duty of the owner of a vacant piece of land to prevent that land from being a public nuisance (citing Attorney General v Tod Heatley [1897] 1 Ch 560, 566). Contrary to Mr Bowderys submissions, that is to my mind clear authority at that level that the word default in a comparable context was not confined to default under the statute itself. Neath Rural District Council v Williams [1951] 1 KB 115 concerned the equivalent provision of the 1936 Act (section 93). A watercourse on the defendants land had become silted by natural causes and caused flooding. Section 259(1)(b), under which a watercourse in such a condition was a statutory nuisance, was subject to a proviso that no liability was imposed on any person other than the person by whose act or default the nuisance arises or continues. It was held that, absent any relevant legal duty on him under statute or at common law to take positive action to remove the nuisance, the defendant was not in default. In the words of the headnote: in the case of a natural stream a landowner had no duty at common law to keep the bed clear by removing obstructions which might arise from natural causes, and the proviso to (section 259(1)) was designed to prevent any additional duty from being cast on the landowner Lord Goddard CJ expressed some doubt about the actual decision in Clayton but felt able to distinguish it on the basis that it was concerned with the words act, default or sufferance whereas the proviso to section 259(1)(b) referred only to act or default (p 126). However, he did not doubt the proposition that default could arise from breach of a duty outside the Act itself. Ramsey J, at para 43, referred to a passage in the judgment of Lord Goddard CJ, who said: I do not think that in this case default could mean merely doing nothing, unless an obligation to do something were imposed by the Act. There was no act of the defendants which caused the obstruction either to arise or to continue In the present case, on the facts found by the justices, there is nothing to show that the defendants did anything which caused this obstruction to arise or to continue; nor do I think that there is anything which can properly be called a default on their part (pp 126 127, emphasis added). This passage cannot be taken as implying that only a duty under the 1936 Act itself was thought relevant. It must be read in the context of the judgment as a whole, in which the possibility of a common law duty had previously been discussed and dismissed (pp 120, 123). I conclude that there is nothing in the factors relied on in the courts below which requires the words in default to be limited to default under the 1984 Act. They were right in my view to hold that the authority had no defence in principle to the claim for compensation, not because (as they held) there was no default under the 1984 Act, but because it was not default by Stylus which led to the emergency action under section 78. It is important to emphasise that this conclusion does not limit in any way the issues which may be taken into account by the arbitrator in assessing compensation attributable to that action, including the statutory and common law responsibilities of Stylus to its clients and employees. As Jackson LJ indicated (para 95), it will be open to the authority to argue that the consequent loss of profit to the business must be substantially reduced due to the structural condition of the pier and the implications it would have had for the continuation of its business quite apart from the effects of the emergency notice. Mr Gasztowicz drew our attention to an earlier paragraph of Jackson LJ (para 79) which might suggest a more limited role for the arbitrator. Having agreed with the judge that the phrase in default means in breach of an obligation under the 1984 Act, he added: The provision does not require the court or the arbitrator to conduct a wide ranging review of other legislation and the common law in order to see whether the claimant is in breach of any duties arising outside the 1984 Act. (emphasis added) I do not fully understand the inclusion in that passage of a reference to the arbitrator, as well as the court. In so far as it implies a limitation on the scope of the arbitrators function it is inconsistent with the later paragraph to which I have referred, and which in my view expresses the correct position. For these reasons, albeit differing in some respects from those of the courts below, I would dismiss the appeal.

In June 2006 the Appellant, Hastings Borough Council (the Council), exercised its emergency powers to restrict public access to Hastings Pier on account of its being in a dangerous condition as a result of serious structural defects. The Respondent, Manolete Partners PLC (Manolete), pursued a claim for compensation against the Council for loss to business as a result of the Councils emergency closure of the pier. Manolete brought the claim as an assignee of the business Stylus Sports Ltd (Stylus), which went into liquidation in late 2011. Stylus had leased two units from the freeholder of the pier, Ravenclaw Investments Incorporated (Ravenclaw), and had operated a bingo hall and amusement arcade. Two years before the closure of the pier, Stylus had commissioned a structural engineering survey of the pier, which advised that urgent and future work, within a year, was required to the structure of the pier to prevent an unacceptable risk to the public. Ravenclaw, which was responsible as landlord for repair and renewal of the pier structure, did not take action to remedy the defects identified. Nor did the Council, and the pier remained open to the public. In April 2006, a section of tension cord fell from the pier. This led the Council to attempt, unsuccessfully, to compel Ravenclaw to take action, and to commission its own structural integrity report, which in June 2006 recommended immediate restrictions on access to the pier. The Council exercised its emergency powers under section 78 of the 1984 Act, and in September 2006 obtained a court order under section 77, prohibiting public access to the pier until the necessary remedial works had been carried out. Section 106 of the Building Act 1984 (the 1984 Act), requires compensation to be paid for loss to a business resulting from emergency action, but only where the owner or occupier of the premises has not been in default. The Council alleged that Stylus had breached the Occupiers Liability Act 1957, which imposes a duty of care towards visitors, and the Health and Safety at Work Act 1974, which imposes a duty on an employer to ensure the safety of his employees and the safety of the workplace. The Council sought to rely on these alleged breaches to establish a default, thereby precluding Manolete from making a compensation claim under the 1984 Act. This defence was rejected by the Technology and Construction Court and the Court of Appeal, on the basis that the reference to default was limited default in respect of obligations imposed by the 1984 Act itself. The Supreme Court unanimously dismisses Hastings Borough Councils appeal. Lord Carnwath gives the judgment, with which the other Justices agree. Section 106 of the 1984 Act gives a right to compensation to a person who has sustained damage by reason of the exercise of the authoritys powers under the Act in relation to a matter as to which he has not himself been in default. This requires firstly, identification of the matter in relation to which authority has exercised its powers, and secondly, consideration of whether that is a matter as to which the claimant has been in default [25]. The relevant power is the power to take emergency action under section 78 of the 1984 Act, and the claim for compensation is limited to the period from the date of the Councils emergency closure of the pier until the court order in September 2006 [26]. The matter which led the Council to take such emergency action was identified in the letter sent by the Council to the tenants at the time, which was the state of the pier combined with fear of possible collapse from crowd loading during the events planned for that month, in particular the risk of overloading in an emergency evacuation. The trigger was not the general state of the pier or the specific repairs identified in the report commissioned by Stylus. Whatever Stylus position towards its clients and employees, it was not in default as to the matter which led to the Councils exercise of its section 78 powers, and on this basis, Manolete is entitled to succeed in its claim for compensation [27 8]. Although not strictly necessary to determine the present appeal, Lord Carnwath addresses the issue of whether default in section 106 is limited to default under the 1984 Act itself, as this may impact on future cases. Lord Carnwath finds that the legislative history and the authorities under the predecessor statutes support the conclusion that the default is not limited to the particular provisions of each statute, but extends to other forms of legal default. Concerns as to the wide scope of the factual inquiry do not arise if the inquiry is limited to the two stage assessment set out above [30 5]. The Court of Appeals conclusion that the Council had no defence in principle to the claim for compensation was correct, not because, as they so held, there was no default under the 1984 Act, but because it was not Stylus default which led to the Councils emergency action [36]. Lord Carnwath emphasises that this does not limit the issues which can be taken into account by the arbitrator in assessing the level of compensation payable. The arbitrator may take account of Stylus statutory and common law responsibilities to its clients and employees, the structural condition of the pier and the implications it would have had for the continuation of business quite apart from the effects of the emergency action [37].

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The issue in this appeal is: what are the statutory consequences if the fingerprints of a defendant have been taken in a police station in Northern Ireland by an electronic device for which the legislation required approval from the Secretary of State, when such approval has never been given? In particular, is any evidence which makes use of the control fingerprints thus taken inadmissible in any subsequent court proceedings? Article 61 of the Police and Criminal Evidence (Northern Ireland) Order 1989 (the Northern Ireland Order) sets out the powers of the police to take fingerprints without consent. Similar (but not in every respect identical) provision is made for England and Wales by section 61 of the Police and Criminal Evidence Act 1984. These powers are exhaustively defined; otherwise prints may only be taken with consent see article 61(1) and, in England and Wales, section 61(1). The cases where prints may be taken without consent have been varied a little from time to time and do not need to be set out seriatim here. One of the principal cases, however, was and is where a person is in police detention having either been arrested for a reportable offence, or charged with, or informed that he will be reported for, such. Another is where he has been convicted of such an offence. Generally, fingerprints may be taken once only in the course of any single investigation, although there are now provisions permitting replacement prints to be required if the first ones were of insufficient quality to allow satisfactory analysis, comparison or matching. Between 1 March 2007 and 12 January 2010 article 61(8B) of the Northern Ireland Order provided: Where a persons fingerprints are taken electronically, they must be taken only in such manner, and using such devices, as the Secretary of State has approved for the purposes of electronic fingerprinting. That provision matched an intended section 61(8A) of the Police and Criminal Evidence Act 1984, which latter provision was inserted into the 1984 Act by the Criminal Justice and Police Act 2001 but was never brought into force. Both article 61(8B) and section 61(8A) were later repealed as redundant by section 112 and schedule 8 of the Policing and Crime Act 2009, with effect from 12 January 2010, and with that repeal there disappeared from England and Wales and from Northern Ireland all requirement for statutory approval of fingerprinting devices. However, although the requirement for approval existed in Northern Ireland (but not in England and Wales) from 1 March 2007, such approval was, by oversight, not given to any device until it was belatedly provided on 29 March 2009 after the omission had been noticed. It follows that for the two years from March 2007 to March 2009 article 61(8B) was in force but no device had been approved as contemplated by it. The two appellants were defendants charged with theft in Northern Ireland. The offence was alleged to have taken place on 6 October 2007, during the two year period mentioned. A stack of building materials had been found removed from the owners depot and placed apparently ready for collection by the thieves. The appellants were found nearby in a van but said that they were there innocently and had not been near the stolen materials. Their fingerprints were taken when they were detained in the police station after their arrest. A fingerprint matching Elliotts left thumb was found on the packaging of the stolen materials. The match of fingerprints was relied upon by the Crown and proved in the magistrates court. The defendants were convicted. The device used in the police station to collect the control sample of the fingerprints of each appellant was a combination of camera, scanner and computer, known as Livescan. No one noticed that no type approval had been given for its use as required by article 61(8B). When this was appreciated, the appellants appealed to the County Court, where the appeal proceeded by way of fresh hearing ab initio. The preliminary point was taken that the evidence of comparison was inadmissible because of the absence of approval. That argument succeeded before the County Court judge but on further appeal by the Crown, by way of case stated, the Court of Appeal ruled against it. The Livescan process was and is generally used by the police throughout Northern Ireland, as well as throughout England and Wales and Scotland and, indeed, worldwide. It has very largely superseded the traditional process of ink pad and paper. It is possible to have mobile devices as well as those located in police stations. Both are linked directly to computerised storage and searching equipment located centrally. Amongst the advantages is the ease of electronic transmission, storage and sorting of the prints taken. One aspect of that is that a set of fingerprints given at a scene or in the street can now often almost instantaneously verify or refute the identity of the person tested. Another is that international exchange of data is made much easier. Livescan devices were in general use in Northern Ireland from 2006 and throughout the two year period 2007 2009 when type approval was required by article 61(8B). For the appellants, the first and principal submission of Mr McMahon QC is that the language of article 61(8B) unequivocally renders a nullity any fingerprints taken by a device which has not been approved. Therefore, no legal use can be made of them. For this reason, there is, he submits, no occasion to investigate what consequences Parliament must have intended should follow from a failure to use an approved device. That would be necessary only if there were an ambiguity in the wording. There is none, and it necessarily follows that the product of an unapproved fingerprinting process is inadmissible. Any other conclusion would, he submits, leave article 61(8B) a dead letter. The difficulty with this attractively simple submission is that the statute says nothing at all about the consequences of failure to use an approved device. There is ample precedent for such a statutory provision to be accompanied by an express provision that evidence shall only be admissible if obtained in accordance with it. An example is afforded by the statutory rules relating to evidence of speed provided by speed guns. Section 20 of the Road Traffic Offenders Act 1988 provides, for England and Wales: (1) Evidenceof a fact relevant to proceedings for an offence to which this section applies may be given by the production of a record produced by a prescribed device, and (a) (b) (4) A record produced or measurement made by a prescribed device shall not be admissible as evidence of a fact relevant to proceedings for an offence to which this section applies unless the device is of a type approved by the Secretary (a) of State, and (b) any conditions subject to which the approval was given are satisfied. Identical provisions are contained in the equivalent Northern Ireland legislation: article 23(1) and (4) of the Road Traffic Offenders (Northern Ireland) Order 1996. There are provisions to similar effect in section 6 of the Noise Act 1996, and in section 45 of the Antisocial Behaviour etc (Scotland) Act 2004, in respect of noise meters. The absence of this kind of explicit statutory provision from article 61(8B) thus raises the question of what consequence was intended to follow from non approval. This legislation was enacted against the background of the well understood general common law rule that evidence which has been unlawfully obtained does not automatically thereby become inadmissible. That has been clear since at least the decision of the Judicial Committee of the Privy Council in Kuruma v The Queen [1955] AC 197, where the defendant was charged with unlawful possession of ammunition which had been found on him as a result of an unlawful search, carried out by a policeman of insufficient seniority to make it. Lord Goddard CJ said this at p 203: In their Lordships opinion the test to be applied in considering whether evidence is admissible is whether it is relevant to the matters in issue. If it is, it is admissible and the court is not concerned with how the evidence was obtained. This proposition was endorsed by the House of Lords in R v Sang [1980] AC 402, which dealt more specifically with the judges discretion to exclude evidence which will have the effect of rendering the trial unfair (see now section 78 of the Police and Criminal Evidence Act 1984 and its equivalent, article 76 of the Northern Ireland Order). Likewise in R v Khan [1997] AC 558 evidence obtained by unauthorised surveillance and the secret recording of private conversations was admissible despite the unlawful methods by which it had been obtained. The position was summarised by Lord Fraser, with whom all other members of the House of Lords agreed, in Fox v Chief Constable of Gwent [1986] AC 281, 292A as follows: It is a well established rule of English law, which was recognised in R v Sang, that (apart from confessions as to which special considerations apply) any evidence which is relevant is admissible even if it has been obtained illegally. It is clear that this inclusive rule of relevant evidence extends equally to evidence created by an unlawful process as it does to existing material uncovered by unlawful process; the recording in Khan is an example of the former. This common law background to the legislation, of which Parliament must be taken to have been well aware, shows that inadmissibility of the fingerprints here under consideration cannot possibly simply follow from the existence of the requirement for device approval. Rather, it is necessary to examine the Parliamentary intention as to consequence. With great respect to Mr McMahons principal argument, it is not correct that article 61(8B) would have no purpose, or would be a dead letter, unless its consequence were that any fingerprints obtained from an unapproved device were inadmissible. Whether or not inadmissibility is the consequence, the article still meant that a requirement by a policeman of a suspect in custody that he provide his fingerprints on an unapproved device would be one which the suspect was entitled to refuse. It might not be very likely that a suspect would be acquainted with the presence or absence of approval, but his solicitor might well be. Such a suspect could therefore refuse to provide his fingerprints on a Livescan device and he would not thereby commit the offence of obstructing a police officer that no doubt he otherwise would. Similarly, if it became known that the police were regularly using an unapproved device, there would be no defence to an application for judicial review in which the unlawfulness of their actions would be declared and, if persisted in, no doubt prohibited. Thus the clear statutory purpose of preventing the use of a device unless it is approved by the Secretary of State would be achieved. There is no need for the additional consequence of inadmissibility of evidence in order to give content to the statute. It follows that the wording of article 61(8B) does not itself provide the solution to the issue in this appeal. It is necessary to examine the question what Parliament must have intended to be the consequence of non approval of Livescan. The correct approach to this enquiry was explained by Lord Steyn in R v Soneji [2005] UKHL 49; [2006] 1 AC 340. It had previously been thought that statutory provisions could be classified as either mandatory (carrying the consequence of total invalidity for breach) or directory (carrying lesser consequence). The over rigidity of that a priori approach had given rise to difficulty. At para 23 Lord Steyn said this: Having reviewed the issue in some detail I am in respectful agreement with the Australian High Court [in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355] that the rigid mandatory and directory distinction, and its many artificial refinements, have outlived their usefulness. Instead, as held in Attorney Generals Reference (No 3 of 1999) [2001] 2 AC 91, the emphasis ought to be on the consequences of non compliance, and posing the question whether Parliament can fairly be taken to have intended total invalidity. That is how I would approach what is ultimately a question of statutory construction. That more flexible approach does not necessarily mean that failure to comply with statutory provisions may not have far reaching consequences. It may sometimes yield the conclusion that the inevitable consequence is total invalidity. That was the outcome in R v Clarke and McDaid [2008] UKHL 8; [2008] 1 WLR 338, where the question was whether the failure to sign an indictment nullified the ensuing trial. The statutory provisions there in question were sections 1(1) and 2(1) of the Administration of Justice (Miscellaneous Provisions) Act 1933 which provided for a bill of indictment (which had of itself no legal standing save as a proposal of charges) to become an indictment when signed. It was common ground that a valid indictment was a pre condition to a valid Crown Court trial. It can be seen from Lord Binghams speech at para 18 that he faithfully posed the Soneji question, namely what Parliament had intended, when passing the 1933 Act, should be the consequence of lack of signature. Since at the time of the 1933 Act the signature was taking the place of the previously existing endorsement of the bill by a Grand Jury, the answer was inescapable, if inconvenient: the signature validated the indictment in the same way as the Grand Jurys decision previously had done. Accordingly the absence of signature did indeed invalidate the subsequent trial, notwithstanding the fact that modern changes in the routes by which criminal cases arrive in the court of trial had in the meantime reduced the signature, in practice, to mere formality. The position had to be put right by amending legislation, in the form of the Coroners and Justice Act 2009. Should a similar parliamentary intention be deduced from article 61(8B)? Mr McMahon relies upon the well established rule that the product of a breathaliser test is inadmissible unless the testing device is an approved one. The cases begin with Scott v Baker [1969] 1 QB 659, decided in the infancy of the Road Safety Act 1967, which had introduced for the first time the offence of driving with blood alcohol beyond a prescribed statutory limit. The power to require a suspect to provide a laboratory blood or urine sample, by which blood alcohol could be tested, was made dependent upon a complex step by step procedure. The first step in that procedure was the taking of a preliminary (usually roadside) breath test. By section 7 a breath test was defined as one carried out using a device approved by the Secretary of State. The court held that such approval was essential to the statutory steps leading to a validly required laboratory sample, and that approval must be proved. The details of the blood alcohol driving legislation have been changed from time to time since then, and breath tests of a different kind are nowadays used not simply as a screening test but to determine the blood alcohol level. However, it remains the statutory rule, under section 7(1) of the Road Traffic Act 1988 and, in Northern Ireland, under article 18(1) of the Road Traffic (Northern Ireland) Order 1995, that a specimen of breath may be required in the course of an investigation into the offences of driving with excess alcohol, or of driving when unfit through drink or drugs, or of causing death by careless or dangerous driving when over the limit or under the influence, and that what may be thus required is limited to: specimens of breath for analysis by means of a device of a type approved by [the appropriate person.] Mr McMahon is therefore right to say that a breath specimen may be adduced in evidence against a defendant not only when the result constitutes the very offence of driving with excess alcohol but also where it is simply some part of the evidence relied on to prove an offence with different components, such as driving when unfit through drink. No one doubts the rule, however, that the product of a breath test will not be admissible unless the device used is an approved one. The statutory requirement for approval of an electronic fingerprint reader is not, however, analogous to the approval requirements in the cases of breath test or speed gun devices. Both the latter are methods of measuring something which cannot subsequently be re measured. They capture a snapshot of a suspects activity. The snapshot is often itself the offence. It is the speed, as measured by the device, which constitutes the offence of exceeding the speed limit. It is the blood alcohol content, as measured by the device, which constitutes the offence of driving with excess alcohol. In other cases, the snapshot is simply part of the evidence, for example if the offence charged is careless driving, or driving whilst unfit through drink. But in both kinds of situation, the activity measured by the device cannot be reproduced to be re measured. It is therefore entirely comprehensible that there should be a statutory requirement that the device should be approved, and that the measurements which can be relied upon in evidence should be limited to the products of such devices. That is no doubt why there are the specific statutory provisions in relation to speed guns described at para 8 above, and it is clearly why the courts have held that the requirements for approval in the case of breath tests have the like effect. The control fingerprints taken from the appellants in the police station were not snapshots. The impressions which their fingers provided could be reproduced at any time afterwards, and would be the same. The accuracy of the Livescan readings, if disputed, could readily be checked independently by the appellants providing more samples, whether by ink and paper or by any other means, for examination by an independent expert. The ease with which this can at any time be done demonstrates that there was no need at all for Parliament to stipulate, or to intend, that the product of unapproved electronic fingerprint readers should be inadmissible. It is the fact that in the present case there was no challenge whatever to the accuracy of the control fingerprints taken from Elliott by the Livescan device; the fingerprint found at the scene matched his control prints in no less than 45 particulars and there was no sign of any reliance on expert opinion either in the magistrates court or, after the absence of approval was appreciated, in the County Court. But if there had been a dispute, as in other cases it is at least possible that there might be, it would have been the simplest possible matter for new control prints to be provided so that independent expert opinion could be obtained. There appeared at first to be some limited support for the appellants contentions in an explanatory note which accompanied the proposed insertion into the Police and Criminal Evidence Act 1984 of section 61(8A) requiring type approval of electronic fingerprint readers. That amendment of the 1984 Act would have been achieved through section 78(7) of the Criminal Justice and Police Act 2001, had that subsection ever been brought into force. The explanatory note to that subsection (number 234) read as follows: Subsection (7) provides that where fingerprints are taken electronically, the device used must have type approval from the Secretary of State. This is to ensure that the device will produce images of the appropriate quality and integrity to be used for evidential purposes. However, the other background material shown to this court demonstrates that the purpose of the proposal for type approval was not principally the protection of the individual against risk of conviction on inaccurate evidence. The concern was much more closely related to the needs for the technology to work properly so that investigations could proceed confidently, for compatibility between police forces, both domestic and foreign, and for uniform machinery for search and comparison. The then Minister of State referred to the aim of facilitating a proper evidential trail. The House of Lords Select Committee on Science and Technology had emphasised the need for the technology to be robust. It is also clear that there was thought at one time that type approval would curtail any potential for unnecessary dispute in court about the legitimacy of electronically taken control fingerprints. The initial recommendation of the Police Scientific Development Branch had been against any stipulation for type approval. The reasons for that stance included the difficulty of formulating a test standard and the frequency of developments to many of the component parts of the system. The successful operation of Livescan in England and Wales over a decade without any type approval, as well as the experience in Northern Ireland, clearly contributed to the subsequent decision in 2009 not to commence the amendment to the English statute, and to repeal both article 61(8B) and the uncommenced section 61(8A). Overall the legislative history does not suggest any basis for concluding that Parliament intended that the consequence of use of unapproved apparatus should be the exclusion of the evidence. Such a consequence would, it is clear, be unnecessary and inappropriate. It is unnecessary because a reading of control fingerprints can always be checked subsequently. It is inappropriate because to exclude such evidence would deprive courts of reliable and relevant material. Since the product can be checked, and the evidence it provides is relevant, it ought to be admissible. If it were not, it would not be open to the police to take further control fingerprints without the consent of the subject, because he would no longer be in detention following arrest on suspicion of the offence, nor would he have been convicted of it. If the control fingerprints were to be inadmissible, not only would there be a windfall benefit to those who have committed crimes, perhaps of great gravity, but also defendants would be unable to rely on the evidence of the fingerprints of others when it was necessary for them to do so in order to defend themselves. A defendant who wished to show that a fingerprint found in an incriminating place belonged to another person, whom he contends committed the offence rather than himself, would be unable to adduce the evidence to do so. Some years after the provisions which we have here to construe, the Protection of Freedoms Act was enacted in 2012. Part 1, Chapter 1 contains, by way of proposed amendments to the Police and Criminal Evidence Act 1984, prospective provisions relating to fingerprints and other biometric data. Equivalent provision for the amendment of the Northern Ireland Order is made by section 9 of and Schedule 2 to the Criminal Justice (Northern Ireland) Act 2013. Neither set of provisions is yet in force but there is a proposed timetable for commencement. If and when these provisions are commenced they will provide for the destruction of fingerprints and other data in certain defined circumstances and/or after prescribed periods. There is express provision in proposed new section 63T(2) of the Police and Criminal Evidence Act 1984 (and in proposed new article 63Q(2) of the Northern Ireland Order) making inadmissible (at least against the person to whom the material relates) fingerprints or other data which the police have come under a duty to destroy. This proposed statutory scheme is consistent with the construction of the provisions we are considering in the present case. Where the intention is to make material inadmissible, express provision is made saying so, in the same way as it was in the statutes considered at para 8 above. Moreover, the proposed new scheme for destruction of biometric data is clearly founded on a view of individual rights which was considered to justify the consequence of inadmissibility if there is a duty to destroy the material. Such considerations do not apply to type approval for the machinery of taking fingerprints which there is no requirement to destroy. For these reasons it is clear that the correct conclusion is that Parliament did not intend, by enacting article 61(8B), that the consequence of an absence of approval should be to render inadmissible any fingerprints produced electronically. The decision of the Court of Appeal that the evidence of Elliots control fingerprints was admissible was correct. It follows that this appeal must be dismissed.

The issue in the appeal is: what are the statutory consequences if the fingerprints of a defendant have been taken in a police station in Northern Ireland by an electronic device for which the legislation required approval from the Secretary of State, when such approval has never been given? In particular, is any evidence which makes use of the fingerprints taken on such a device inadmissible at the defendants trial? The appellants were charged with theft in Northern Ireland. The offence was alleged to have taken place on 6 October 2007. A stack of building materials had been found removed from the owners depot apparently ready for collection by thieves. The appellants were found nearby in a van but said they were waiting there innocently. They were arrested and their fingerprints were taken at the police station using an electronic fingerprint scanner called Livescan. This machine has been commonly used by police in the UK, including in Northern Ireland, for a number of years. A fingerprint matching Elliotts left thumb was found on packaging of the building materials. Article 61 of the Police and Criminal Evidence (Northern Ireland) Order sets out the powers of the police to take fingerprints without consent. Between 1 March 2007 and 12 January 2010 article 61(8B) provided that where a persons fingerprints are taken electronically, they may only be taken using such devices, as the Secretary of State has approved for the purpose of electronic fingerprinting. Due to an oversight no approval was ever given to any device (including Livescan) until it was belatedly provided on 29 March 2009. Article 61(8B) was later repealed by the Policing and Crime Act 2009. Therefore at the time the fingerprints were taken from the appellants there was no approval for the Livescan machine in breach of article 61 (8B). The appellants were convicted at trial and no issue over the fingerprints was taken. After the lack of approval for the Livescan device was noticed the appellants appealed to the County Court which, after a full re hearing, declared the fingerprint evidence inadmissible and acquitted the appellants. The Public Prosecution Service appealed to the Court of Appeal who allowed the appeal and reinstated the appellants convictions. The appellants primary argument before the Supreme Court and the courts below was that the lack of approval for the Livescan device meant that the fingerprints obtained with it were automatically inadmissible at the appellants trial. The Supreme Court dismisses the appeal. Lord Hughes gives the judgment of the court. The difficulty with the appellants argument is that the statute says nothing about the potential consequences of failure to use an approved device. This is despite the fact that there are numerous examples of other statutes where such consequences are expressly spelled out, such as in relation to obtaining specimens of breath for road traffic offences [8]. There is a well understood common law rule that evidence which has been obtained unlawfully does not automatically become inadmissible. It is clear that this rule extends equally to evidence created by an unlawful process as it does to existing material uncovered by unlawful process. The common law background to the legislation (article 61 (8B)) shows that inadmissibility of the fingerprints here under consideration cannot possibly simply follow from the existence of the requirement for device approval [9]. It is not correct to say that article 61 (8B) would have no purpose unless fingerprints obtained from unapproved devices were inadmissible at trial. A defendant who was asked to give a fingerprint on an unapproved device could lawfully refuse to do so. While, if such devices were found to be routinely in use by police, there would be no defence to an application for judicial review in which their unlawfulness could be declared and further use prohibited [10]. The appellants relied on the rule that the product of a breathalyser test was inadmissible unless the testing device was an approved one. However, the requirement for approval of fingerprint devices is not analogous to that in cases of breath tests or speed guns. The latter are methods of measuring something that cannot be re measured, they capture a snapshot of the suspects activity and are often the offence itself i.e. being found to be over the prescribed limit of alcohol at the time of driving. The fingerprints on the other hand could be reproduced at any time afterwards, and would be the same. If the Livescan readings were disputed they could readily be independently checked for accuracy and further fingerprints taken by a different method. The ease of which this could be done shows there was no need for Parliament to stipulate that the product of unapproved fingerprint readers should be inadmissible. Further, no challenge was ever made by the appellants to the accuracy of the fingerprints taken by the Livescan device [15]. The background material to the legislation shown to the Court further shows that the purpose of the requirement for device approval was not principally the protection of the individual against the risk of conviction on inaccurate evidence [16]. Relevant parts of the Protection for Freedoms Act 2012 and Criminal Justice (Northern Ireland) Act 2013 regarding fingerprints that have yet to come into force further support the construction of the legislation chosen by the Supreme Court in this case as, where required, express provision is made for evidence to be inadmissible [18].

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Mr Thomas Arthur Watkins lived near Tredegar in South Wales. He was employed by the National Coal Board (later British Coal Corporation) (British Coal) as a miner from 1964 until 1985. In that employment he was required to use vibratory tools and as a result of such exposure, in common with very many other miners, Mr Watkins developed Vibration White Finger (VWF) which is a form of Hand/Arm Vibration Syndrome (HAVS). He first experienced the symptoms, which consist of whitening, stiffness, numbness and tingling of the fingers of both hands, not later than the early 1980s. After he left the employment of British Coal in 1985, he worked as a driver of road sweeping vehicles until he retired in 1997. Shortly after that he was diagnosed with osteoarthritis in both knees which became increasingly acute. One symptom of VWF can be a reduction in grip strength and manual dexterity in the fingers. A common, although not invariable, consequence is that a person suffering from these conditions becomes unable, without assistance, to carry out routine domestic tasks such as gardening, do it yourself or car maintenance. The Scheme A group of test cases, representative of some 25,000 similar claims, established that British Coal had been negligent in failing to take reasonable steps to limit the exposure of employed miners to VWF from the excessive use of vibratory tools (Armstrong v British Coal Corpn [1998] CLY 975). As a result, the Department for Trade and Industry (DTI), which had assumed responsibility for British Coals relevant liabilities, set up a scheme in 1999 to provide tariff based compensation to miners who suffered from VWF as a result of exposure to excessive vibration (the Scheme). The Scheme was administered pursuant to a Claims Handling Arrangement (the CHA) dated 22 January 1999 and made between the DTI and a group of solicitors firms representing claimant miners suffering from VWF. The central objective of the CHA was to enable very large numbers of similar claims to be presented, examined and resolved expeditiously. The Scheme contemplated the making of two main types of compensatory award to miners suffering from VWF, corresponding broadly with general and special damages for personal injuries. The Scheme provided for compensation to be paid for pain, suffering and loss of amenity (General Damages), and for handicap on the labour market and other financial losses (Special Damages) including past and/or future loss of earnings. Pursuant to a Services Agreement dated 9 May 2000 the special damages could include a services award for qualifying miners in respect of the need for assistance in performing domestic tasks. Under the Scheme, each claimant was required to complete a questionnaire on his work history and IRISC, the claims handling organisation which acted on behalf of the DTI, would then allocate him to a particular occupational group, depending on his likely exposure to vibration. He would then undergo a medical examination in accordance with a defined Medical Assessment Process (MAP) by a doctor appointed under the Scheme. The resulting MAP 1 report was in standard format and was intended to determine whether the claimant suffered from VWF and, if so, the severity of the condition by reference to the stagings on the Stockholm Workshop Scale. The V score was a measure of the vascular symptoms and depended largely on reporting from the patient. The extension of blanching was recorded diagrammatically by the examining doctor. The sensori neural signs and symptoms were assessed partly from the claimants account and partly by standardised testing, the results of which were recorded as Sn markings. It was open to a claimant to challenge the findings of the MAP 1 report but there was no provision for IRISC to do so. Within 56 days of receipt of the MAP 1 report IRISC was obliged to make an offer of compensation or to reject the claim with reasons. The Services Agreement of 9 May 2000 was incorporated in the CHA as Schedule 7(1). It recorded an agreed approach to compensation for services. The respective medical experts of the parties to the Scheme rejected the idea that there should be an individual assessment of each claimants ability to carry out particular household tasks. Instead it was agreed that an assumption be made that once the condition had reached a certain level(s) causation it should be presumed that a man could no longer carry out certain tasks without assistance. The examining doctor would then merely have to consider whether there were any other conditions (VWF apart) which of themselves would have prevented the man from undertaking the task in question thereby rebutting the presumption. (Schedule 7.1, paragraph 3.1(ii)) Six tasks were identified for this purpose: gardening work, window cleaning, do it yourself, decorating, car washing and car maintenance (Schedule 7.1, paragraph 3.3). Claims under the Services Agreement were processed in the following way. The experts produced a matrix identifying in respect of each staging of 2V and 2Sn late, or higher, the tasks for which a claimant would be presumed to require assistance. Once a claimant had a staging of at least 2V or 2Sn late, a claimant was entitled to a services award if he had previously performed one of the identified tasks, but now required assistance to do so as a result of his VWF. Men at 2V on the scale would be expected to have difficulty with all tasks except do it yourself and decorating and at 3V would be expected to have difficulty with decorating. It was further assumed that the condition would not have deteriorated since cessation of exposure to vibration (Schedule 7.1, paragraphs 4.1, 4.2). A claimant did not have to show that his condition wholly disabled or prevented him from carrying out the relevant task. It was enough that he could no longer carry it out without assistance. The approach left to be determined when a claimant reached the relevant stages, whether he suffered from any other conditions which would have prevented him from continuing to carry out any tasks in any event (co morbidity), and, if so, what that condition was, when it developed and the extent to which it compromised his ability to carry out the relevant tasks expressed on a scale of nil, material, moderate, serious and complete (Schedule 7.1, paragraphs 3.7, 5.1). Factual evidence concerning a services claim was presented by a simple questionnaire completed by the claimant. Because it would be impracticable to investigate individual claims in any detail, the Scheme provided that broad assumptions will be made about the average assistance that would be required for the particular task by the individual at the relevant stage (Schedule 7.1, paragraph 6.7). Schedule 7 stated that practical and other considerations militate against other than a tariff based approach given the number of claims and the need for a quick, efficient and inexpensive approach to their settlement. (Schedule 7, paragraph 6.2) In addition, a claimants most recent helpers would complete questionnaires. A claimant would then be sent for a further medical examination (MAP 2) which was solely concerned to consider whether there were any other conditions which, of themselves, would have prevented the claimant from undertaking the task in question. A claimant was not usually contacted by IRISC concerning his claim, but helpers were. This normally consisted of a telephone interview, which might last 15 minutes, during which the helper would be asked whether he or she had assisted with the tasks claimed and, if so, when they started to do so. Even where the helper was out by a few years on dates, the information in the questionnaire would still be accepted. On receipt of the questionnaires, IRISC would consider each claim on its merits, adopting a pragmatic approach. If IRISC did not accept the claim entirely it had to set out in detail the reasons for rejecting the claim in whole or part. Compensation was calculated by application of a multiplier/multiplicand approach and an index linked tariff was set in respect of each task according to the particular staging. IRISC could reject a claim for services in whole or in part if a claimants work history after leaving the mining industry was such as to indicate that his ability to carry out the relevant tasks was not impaired. However, in order to be entitled to rebut the presumption that a man with a particular claimants stagings could not carry out the relevant tasks without assistance, IRISC had to discharge the burden of establishing that the work actually carried out by the claimant was such as to demonstrate that he could reasonably be expected to carry out all aspects of the task without assistance. Pending resolution of the services claim, a claimant was entitled to receive an interim payment in respect of his claim for general damages and handicap on the labour market. Mr Watkinss claim In February 1999 Mr Watkins instructed Hugh James Ford Simey Solicitors (the appellant) to act for him in relation to a claim under the Scheme. His claim was notified to the DTIs claims handlers on 10 February 1999. By November 1999 Mrs Barbara Kinsey, litigation solicitor within the appellant firm, had assumed responsibility for many VWF claims, including that of Mr Watkins, at the appellants office in Bargoed and, from 2001, Treharris. On 31 January 2000 Mr Watkins underwent an interview and examination performed in part by Dr Chadha, a general practitioner appointed under the Scheme, and in part by an unnamed laboratory technician, to assess whether he was suffering from VWF and, if so, how his condition should be categorised under the Stockholm Workshop Scale for its vascular and sensorineural components. This was referred to as a Medical Assessment Process 1 (MAP 1) examination. In a report dated 3 February 2000 Dr Chadha indicated that Mr Watkins suffered from VWF with stagings of 3V and 3Sn bilaterally (ie in both hands). Those stagings were sufficient for Mr Watkins to obtain general damages and to entitle him to a presumption in his favour that he satisfied the qualifying requirements for a services award. Mr Watkins did choose to seek a services award. He and his assistants completed the necessary questionnaires which were sent to the DTIs claims handlers on 23 March 2001. They initially sought to deny Mr Watkinss entire claim on the basis that he had not been exposed to excessive vibration while working for British Coal. The appellant challenged that decision and eventually the claims handlers were persuaded to accept Mr Watkinss claim under the Scheme. As a result of this delay, it was not until 12 February 2003 that the claims handlers wrote to the appellant, offering Mr Watkins the sum of 9,478 in full and final settlement of all [Mr Watkinss] claims arising out of his exposure to vibration during the course of his employment with the British Coal Corporation. 9,478 was the tariff award for general damages to which Mr Watkins would have been entitled under the Scheme on the basis of the stagings of 3V and 3Sn bilaterally. The offer made did not include any allowance for a services award. The appellant wrote to Mr Watkins on 18 February 2003, reporting the offer which had been received and advising him as to what would be involved should he wish to proceed with a special damages claim. On 23 February 2003 Mr Watkins spoke by telephone with Mrs Kinsey at the appellant and told her that he didnt want to proceed any further with the special damages claim as he had other conditions and had had various operations which in his view prevented him from carrying out certain tasks. He indicated that he was quite happy to continue with general damages only and would accept the offer. Mr Watkins completed a form of acceptance on 24 February 2003 and the appellant wrote to the claims handlers on 27 February 2003 accepting the offer in full and final settlement of Mr Watkinss VWF claim against British Coal. The professional negligence proceedings Nearly five years later, in January 2008, Mr Watkins, having seen a newspaper advertisement offering assistance to any ex miner who may have had his VWF claim settled at an undervalue, instructed fresh solicitors, who issued proceedings against the appellant on 11 August 2010. By the amended particulars of claim it is contended that as a result of the appellants negligence, Mr Watkins has lost the opportunity to bring a services claim under the Scheme or otherwise. That lost opportunity is quantified at 6,126.22 plus interest. On 22 October 2010, His Honour Judge Hawkesworth QC made an order in relation to a number of claims against solicitors arising out of the Scheme, directing that disputes about expert evidence and disclosure be dealt with at a hearing before him. The six test cases identified in the order did not include Mr Watkinss claim. Following a hearing, by order dated 3 May 2011 Judge Hawkesworth ordered that his directions should apply to all prospective and existing claims alleging negligence against solicitors in the context of the advice given by those solicitors in respect of claims for damages [under the Scheme]. He directed that expert evidence should be obtained in the form of a report by a single joint expert. A schedule to the order set out a standard form letter of instruction to such a single joint expert in terms approved by the judge. That standard form was adopted in the letter dated 21 January 2013 by which the parties to the present proceedings jointly instructed Mr Tennant, a consultant vascular surgeon. It stated: It is an issue in the proceedings whether Mr Watkins would, if properly advised, in fact have brought a Services claim at all. Whether Mr Watkins was, as a result of HAVS, in fact disabled from carrying out (in whole or in part) the tasks he alleges would have formed the basis of his Services claim is relevant to that issue. Accordingly, we wish jointly to instruct you to carry out a medical examination of Mr Watkins and, on the basis of that examination and your consideration of the documents referred to below and attached to this letter, to prepare a report stating your opinion as to whether Mr Watkins is and was at any time from the date of onset of HAVS symptoms: (1) Disabled by HAVS as a matter of fact and, to the extent that he was, unable to carry out (in whole or in part), without assistance, the tasks which he alleges would have formed the basis of his Services Claim; and (2) Suffering from any co morbid medical condition which would, in any event, have affected his ability to carry out those tasks without assistance. In relation to co morbidity, could you please express your opinion as to whether any such co morbidity was at any time since the date of onset of HAVS symptoms: nil; minor; moderate; serious; complete (ie would have prevented the carrying out of the task in any event) If, in the course of your medical examination, you conclude that Mr Watkins does not, in fact, suffer from HAVS, you should report that opinion in your Report. The letter made clear that the expert was not to apply in Mr Watkinss favour the presumption under the Scheme that he could no longer carry out the relevant tasks without assistance by reason of his VWF staging. Mr Tennant examined Mr Watkins and, in a report dated 17 May 2013, he stated: Mr Watkins gives a good description of vasospasm and is graded 1V in this report as the white discolouration reaches the distal interphalangeal joint. The only abnormality on testing was of a mild lack of dexterity. As there is no other sensory loss in a warm environment, in my opinion this amounts only to HAVS grade Sn1. There is certainly no justification for Sn3 at this examination, and to reach Sn2 would require evidence of reduced sensory perception, which I could not demonstrate. Grading of 1V, 1Sn would not be expected to produce any disability in the domains tested below. In response to further questions from Mr Watkinss solicitors, Mr Tennant confirmed on 23 June 2013 that Mr Watkins met the criteria for the diagnosis of HAVS. He further stated that it was apparent at interview that the client had devolved certain tasks to others in the long term. Mr Watkins died in January 2014 at the age of 72. His daughter, Mrs Jean Edwards, was appointed to continue the claim on behalf of Mr Watkinss estate. The trial of the claim against the appellant took place in the County Court at Leeds before Mr Recorder Miller in March 2016. The parties had permission to rely on Mr Tennants written evidence at trial but an application by the appellant, made in advance of trial, for permission to call Mr Tennant was refused and that order was not appealed. The statements of Mr Watkins were admitted as hearsay evidence. In a reserved judgment, handed down on 16 May 2016, the judge held that the claim in negligence was not time barred, that the advice contained in the appellants letter dated 18 February 2003 had been negligent and that if Mr Watkins had received appropriate advice, he would probably have decided to reject the settlement offer of 9,478 and would have continued to pursue his services claim. However, the judge also held that Mr Watkins had suffered no loss and accordingly he dismissed the claim against the appellant. He observed: If, as here, expert or other evidence which post dates the settlement or other disposal of the original claim, establishes beyond any (or any but negligible) doubt that the claim could and would have been resolved only in one specific way had that evidence been available to the parties and the tribunal at the time, then the Court in the professional negligence action has the full facts adverted to by Laws LJ in Whitehead [v Searle [2009] 1 WLR 549, para 20] and should find accordingly, thereby avoiding an uncovenanted windfall or correcting injustice to a claimant whose case has turned out to be undoubtedly stronger than had been previously assumed. In the case of Mr Watkins, I can and should find that his chose in action has been shown to have had no value given the damages actually paid to him; another way of putting it is that, as I have found on the full facts, his services claim had no chance of success, for the same reason: it is beyond a peradventure that faced with Mr Tennants clinical findings and conclusions any award would have fallen short of 9,478. It is fanciful to assume otherwise. The judge took that view because on the consultants findings Mr Watkins would only have been offered 1,790 for general damages and a services claim would not have been possible. On appeal to the Court of Appeal (Underhill, Irwin and Singh LJJ) the appeal was allowed: [2018] PNLR 30. The Court of Appeal, influenced by the decision of the Court of Appeal in Perry v Raleys Solicitors [2017] PNLR 27 (more recently reversed by this Court [2019] 2 WLR 636) held that the trial judge had been wrong to conduct a trial within a trial to determine the value of Mr Watkinss claim against the DTI and to determine the severity of his VWF. It further held that the judge had been wrong to determine these matters on the basis of the evidence of Mr Tennant, since that evidence would not have been available at the time of Mr Watkinss notional services claim under the Scheme. Irwin LJ observed (at para 70) that it would be particularly inappropriate to lose sight of what would have been the outcome under the Scheme by reference to after coming evidence which would not have been brought into being at the time. The Court of Appeal further acknowledged exceptions in the case of fraud and in cases, such as Whitehead v Searle [2009] 1 WLR 549, where the consequences of a supervening event were of such a significant or serious scale that public policy required a departure from normal principles in order to do justice between the parties. In its view, such circumstances did not exist in the present case. The appellant now appeals to this court with the permission of this court. Although the appellant sought to appeal on 14 (partly overlapping) grounds, permission was limited to the sole question of whether the prospects of success of the claim are to be judged as at the date when the claim was lost or at the date when damages are awarded and it directed that the parties consider the relevance of the principle in Bwllfa and Merthyr Dare Steam Collieries (1891) Ltd v Pontypridd Waterworks Co [1903] AC 426, namely that where the court assessing damages has knowledge of what has actually happened it should not speculate about what might have happened but base itself on what is now known to have happened. (See McGregor on Damages, 20th ed (2018), para 10 118.). Although this was the reason why permission to appeal was granted, the Court has concluded, in the light of the wide ranging arguments presented to us, that the Bwllfa principle is not relevant in the particular circumstances of this case. On behalf of the appellant, Mr Michael Pooles QC submits that the trial judge was right to rely on the evidence of Mr Tennant for four reasons. (1) In the circumstances of this case, the question whether Mr Watkins had suffered loss should be determined as at the date of the trial of the claim against the appellant, applying the Bwllfa principle. (2) In a professional negligence claim arising from personal injury litigation, the issue of loss should be determined as at the date of the trial of the professional negligence proceedings as it would have been in personal injury litigation (Golden Strait Corpn v Nippon Yusen Kubishika Kaisha (The Golden Victory) [2007] 2 AC 353, per Lord Bingham of Cornhill at para 13). (3) Even if the issue of loss should be determined at an earlier date, the Court should in making that determination take account of all of the evidence available at the trial of the professional negligence proceedings, following the decisions in Charles v Hugh James Jones & Jenkins [2000] 1 WLR 1278, Dudarec v Andrews [2006] 1 WLR 3002 and Whitehead v Searle, as this would enable the court to make a more accurate assessment of what the original personal injury claim was actually worth. (4) That evidence was needed in the present case to enable the issue of loss to be determined with all the adversarial rigour of a trial as required by the Supreme Court in Perry v Raleys Solicitors: [2019] 2 WLR 636, para 19. On behalf of the respondent, Mr Richard Copnall submits that the court should assess the prospects of success as at the date when the claim was lost, on the facts as they were and the evidence available at that time, subject to the following established exceptions. (1) Evidence that would have been available, in the absence of negligence, at the time the claim was lost will be admissible (Charles; Dudarec v Andrews [2006] 1 WLR 3002). (2) Evidence of the original parties attitude to settlement at the time that the claim was lost will be admissible (Somatra Ltd v Sinclair Roche and Temperley [2003] 2 Lloyds Rep 855). (3) Evidence of dishonesty or misconduct will be admissible (Perry; Green v Collyer Bristow [1999] Lloyds Law Rep PN 798). (4) Evidence of any accomplished fact within the meaning of the Bwllfa principle will be admissible. Discussion We are concerned with a claim in the tort of negligence. Although the claim for breach of contract was time barred, the judge held that, by virtue of section 14A of the Limitation Act 1980, as inserted by section 1 of the Latent Damage Act 1986 (Special time limit for negligence actions where facts relevant to cause of action are not known at date of accrual), the claim in negligence was not. In order to succeed in negligence against Mr Watkins former solicitors his estate had to establish a negligent breach of duty, causation and loss. A negligent breach of duty was found by the judge, on the basis that the appellants letter of 18 February 2003 was misleading and deficient in a number of respects and those features were not corrected in the subsequent conversation between Mr Watkins and Mrs Kinsey on 23 February 2003. There has been no appeal against that conclusion. In addition, the judge made a finding that, had Mr Watkins received non negligent advice, he would have pursued an honest services claim. That claim had already been notified and supporting statements provided. The judge considered that, had Mr Watkins been more fully and accurately informed as to where he stood and how the scheme operated, he would probably have instructed Mrs Kinsey to let the services claim and a MAP 2 medical examination proceed. The judge expressly rejected the submission on behalf of the appellants that, in reality, Mr Watkins had realised that his evidence in support of the services claim was grossly exaggerated or invented and, as a result, he had discontinued it for fear of getting into trouble or losing out financially further down the line. There has been no appeal against that conclusion. Accordingly, the issue considered by the Supreme Court in Perry v Raleys Solicitors does not arise in this case and, in my view, that decision has no direct bearing on the issues which we have to decide. For the claim by Mr Watkinss estate to succeed, however, it is also necessary to prove loss. There is a legal burden on the estate to prove that in losing the opportunity to pursue the claim Mr Watkins has lost something of value ie that his claim had a real and substantial rather than merely a negligible prospect of success. It is only if the estate can establish that Mr Watkinss chances of success in pursuing his service claim were more than negligible that it is appropriate to go on to evaluate those chances on a loss of chance basis by making a realistic assessment of what would have happened had the original claim been pursued (Mount v Barker Austin [1998] PNLR 493 per Simon Brown LJ at pp 510D to 511C). In the view of Mr Recorder Miller, the present claim failed at the first hurdle. On the basis of the evidence of Mr Tennant the judge considered that Mr Watkinss chose in action had no value given the damages actually paid to him. It was clear, in his view, that any award would have fallen short of the 9,478 which Mr Watkins had already received under the settlement. Against this background, the argument before this court has focussed on the issue of the admissibility in a professional negligence action of subsequently acquired evidence relating to the value of the original claim, an issue on which we have heard elaborate submissions. However, it is not necessary to express a concluded view in relation to these matters because the evidence contained in Mr Tennants report was not relevant to any issue before the court in the professional negligence proceedings. As a result, the authorities relied on by the appellant are not relevant in the particular circumstances of this case. It is important not to lose sight of the fact that Mr Watkinss original claim was a claim within the Scheme and not one made in the course of conventional civil litigation. It is necessary to consider whether Mr Watkinss original claim, which was accepted by the judge to be an honest claim, was of more than negligible value within the context of the Scheme. When the evidence of Mr Tennant is considered in this light, it is not the knock out blow which the appellant suggests. The Scheme has been described by Irwin LJ in the Court of Appeal and by counsel before us as a rough and ready scheme. This is a fair description. It was intended to provide an efficient and economic system for dealing with a huge number of claims in a way that was broadly fair. No doubt, it was considered that the decision not to require a detailed medical assessment of the level of disability of every claimant for a services award was justified by the savings in cost. A deliberate decision was taken to deal with services claims by reference to presumptions derived from the diagnosis and staging found at MAP 1, as opposed to requiring a precise assessment of the underlying disability. Medical assessment in the MAP 2 procedure was to be limited to the issue of co morbidity. More specifically, there was no provision within the Scheme whereby the DTI could appeal against a general award, nor did the Scheme contemplate reopening or reassessing the diagnosis or staging of the condition or the entitlement to a general award established at MAP 1. Recoverability under the Scheme, therefore, did not depend on entitlement at common law nor did it correspond with what might have been the outcome in conventional civil proceedings. In this case Mr Watkins lost the value of his claim under the Scheme as it would have been administered in accordance with its terms. In this regard it is instructive to consider why Judge Hawkesworth QC made the order in the professional negligence proceedings for further medical reports. In his judgment of 3 May 2011, he explained that it was common ground that the claims were for the lost chance to bring a claim under the MAP 2 procedure. On behalf of the claimants it was contended that the scope of the medical evidence should be a replication of the MAP 2 procedure which was limited to the issue of comorbidity, while on behalf of the defendants it was contended, initially at least, that there should be a more comprehensive medical examination by a consultant specialist which could revisit the original diagnosis of VWF as well as address the issue of comorbidity. For the claimants it was submitted that because the MAP 2 examination did not revisit or reopen the original diagnosis it would not be appropriate for the medical expert in the professional negligence proceedings to address them. During the hearing, however, it became clear that counsel for the defendants were not contending for a medical examination in order to revisit the diagnosis and staging of the VWF condition, but in order to evaluate the claimants case on causation ie in order to assess whether a claimants failure to pursue a services claim arose from negligent advice or from an inability to assert truthfully that he had lost the ability to perform those specified activities which would enable him to bring a claim for a services award. It was said that the extent of disability was relevant to that issue, while the medical examination in the MAP 1 procedure was predominantly directed at diagnosis and staging of the condition as opposed to the level of disability. Miss Foster [who appeared for four defendant firms of solicitors] did not seek to say that the fact of a MAP 1 diagnosis and its consequences for the subsequent progression to a services claim could be called into question. However, the defendants were entitled to investigate the implied averment that had the claimant been properly advised he would have made a services claim. (at para 7) The judge seems to have made the order for expert reports on that basis but expressly left open (at para 9) the question as to the extent to which any findings by an examining doctor could or could not be taken into account in valuing the loss of a chance to bring a services claim. The joint letter of instruction sent to Mr Tennant on 21 January 2015 (set out at para 13, above) reflected this reasoning. As a result, the instructions and the resulting medical examination and report departed significantly from those in a MAP 2 procedure. Most significantly, the expert was not to apply the presumption resulting from the diagnosis and staging at MAP 1 which applied under the Scheme. Mr Tennants report may have been relevant to the issue of causation in the claim by Mr Watkinss estate against his former solicitors. However, the judge decided that issue in favour of the estate, finding that if Mr Watkins had received non negligent advice he would have pursued an honest services claim. That conclusion has not been challenged on appeal. In my view, Mr Tennants report is not relevant to the issue of loss. We must assume that had Mr Watkins pursued a services claim the Scheme would have operated in accordance with its provisions. The conclusion of Dr Chadha that Mr Watkins was suffering at the level of 3V, 3Sn bilaterally had entitled him, under the tariffs applied within the Scheme, to an award of general damages of 9,478 and also created a rebuttable presumption that he did require assistance with the tasks prescribed under Schedule 7 of CHA. Mr Watkins would have had to undergo a second medical examination but that would have been limited to assessing co morbidity. There would have been no equivalent of Mr Tennants report, no reassessment of the diagnosis or staging found in the MAP 1 procedure and no reduction of the general award. Entitlement to a services award would have been decided in accordance with the procedure described at paras 4 8 above. The appellant now seeks to add to the counterfactual situation the effect of a further medical examination and report which would never have been commissioned. There is no justification for such a modification of the counterfactual situation and the judge erred in taking it into account when concluding that the lost claim was of no value. When Mr Tennant conducted his examination of Mr Watkins and prepared his report, he acted in accordance with his instructions in expressing his view as to whether and to what extent Mr Watkins was disabled by HAVS as a matter of fact and, to the extent he was, unable to carry out without assistance the tasks which formed the basis of his services claim. His opinion is set out at para 14 above. However, he then proceeded to set out his opinion on co morbidity in accordance with the Scheme by taking as his starting point the conclusions of Dr Chadha (3V, 3Sn) as in the MAP 1 report and grading disability for the purpose of a services claim on that basis. In doing so he provided an insight into the value of the claim which Mr Watkins lost. For each of the five activities relevant to Mr Watkinss case (car washing, car maintenance, gardening, DIY and decorating) his disability is assessed as complete. Mr Tennant states that on the basis of the MAP 1 report his HAVS would be expected to produce severe or complete disability in the tested domains. The only comorbidity to take into account is Mr Watkinss arthritic knees and this results in a comorbidity finding of moderate in all of the tested domains other than gardening where the finding is severe. In these circumstances I am unable to accept that the services claim had no chance of success and that the claim lost was of no value. At the heart of this case lies Mr Pooless assertion that Mr Tennants report shows that because of an error Mr Watkins had already been over compensated and that a professional negligence claim should reflect his true entitlement to just compensation and not what would have been an uncovenanted windfall. However, this overlooks the nature and operation of the Scheme. The payment of a services award to Mr Watkins would simply have been a consequence of the way in which the Scheme operated and was intended to operate. We are not concerned here with a claim in conventional civil proceedings but with a scheme possessing unusual features. The evidence in question, the report of Mr Tennant, is simply not relevant when constructing the counterfactual situation which would have arisen if Mr Watkinss solicitors had fulfilled their duty to him. I consider, therefore, that the Recorder erred in concluding that Mr Watkinss services claim could and would have been resolved only in one specific way had Mr Tennants report, or its equivalent, been available to IRISC and in concluding that the claim had been shown to have no value given the award already paid. On the contrary, Mr Watkins had lost a claim under the Scheme of some value and the Recorder should have proceeded to assess its value on a loss of opportunity basis. I would therefore dismiss the appeal and remit the matter for assessment of the value of the loss of the opportunity to pursue the services claim.

This appeal relates to a compensation scheme (the Scheme) set up in 1999 by the Department for Trade and Industry to provide tariff based compensation to miners employed by the British Coal Corporation (British Coal) who suffered from a medical condition called vibration white finger (VWF) as a result of excessive exposure to vibration through the use of vibratory tools. The Scheme provided for compensation to be paid for pain, suffering and loss of amenity (General Damages) and handicap on the labour market and other financial losses including past and/or future loss of earnings (Special Damages), which could include a services award to cover the need for assistance in performing specified domestic tasks. Rather than conducting an individual assessment of each claimants ability to carry out the specified tasks, the Scheme applied a presumption based on the condition reaching a certain level of severity. Mr Arthur Watkins was employed by British Coal as a miner from 1964 until 1985 and had developed VWF by the early 1980s. In 1999 he instructed the appellant to act for him in relation to a claim under the Scheme. Findings from a medical examination and interview indicated that Mr Watkins could obtain General Damages and qualified for the presumption in his favour that he satisfied the requirements for a services award. Mr Watkins sought a services award. In 2003 he was instead offered the tariff award for General Damages in full and final settlement of his claims. The appellant wrote to Mr Watkins on 18 February 2003 reporting the offer. After a telephone conversation with an employee of the appellant, Mr Watkins accepted the offer. In 2008, Mr Watkins instructed new solicitors to bring a claim against the appellant for professional negligence, on the basis that as a result of the appellants negligence Mr Watkins had lost the opportunity to bring a services claim under the Scheme. Mr Watkins died in 2014 and his daughter, Mrs Jean Edwards, was appointed to continue the claim on behalf of his estate. The first instance court held that the letter of 18 February 2003 and the advice given had been negligent and that had Mr Watkins received appropriate advice he would probably have rejected the offer and pursued his services claim. A jointly instructed medical expert, who had been instructed not to apply the presumption that would have applied under the Scheme, provided a report that concluded Mr Watkinss symptoms would have been insufficient to succeed on a services claim. The court therefore held that Mr Watkins had suffered no loss and dismissed the claim. Mr Watkins successfully appealed to the Court of Appeal, which decided that the trial judge had been wrong to determine the value of the services claim on the basis of evidence that would not have been available at the time of the notional claim. The appellant seeks to appeal that decision. The issue in the appeal is whether, in assessing the prospects of success of the negligence claim, the court should have taken account of the further medical report. The Supreme Court unanimously dismisses the appeal and remits the matter for assessment of the value of the loss of the opportunity to pursue the services claim. Lord Lloyd Jones gives the judgment, with which all members of the Court agree. In order to succeed in his claim in the tort of negligence, Mr Watkins had to establish a negligent breach of duty, causation and loss. The trial judge found that there had been a negligent breach of duty and that causation was established. Neither conclusion has been appealed [22]. To succeed, therefore, Mr Watkinss estate must prove loss, specifically that in losing the opportunity to pursue the claim Mr Watkins lost something of value, i.e. that his services claim had a real and substantial rather than merely a negligible prospect of success [23]. Mr Watkinss original claim was within the Scheme, and it is therefore necessary to consider whether the claim was of more than negligible value within the context of that Scheme [25]. The expert report was concerned with causation, not loss, and was prepared to assist in the assessment of whether Mr Watkinss failure to pursue a services claim arose from negligent advice or from an inability to assert truthfully that he had lost the ability to perform activities that would qualify him for a services award [27]. As a result, the expert was instructed not to apply the presumption used under the Scheme [28]. Had Mr Watkins pursued a services claim it would have proceeded on the basis of the Schemes procedures. He would have had to undergo only a limited second medical examination and there would have been no equivalent of the experts report. His entitlement to a services award would have been decided by the application of the Schemes presumption. There was no justification for considering a further medical examination and report which would not have been commissioned under the Scheme and therefore the judge erred in taking this into account [29]. Given other findings in the expert report, the court is unable to accept that the services claim had no chance of success so that the lost claim was of no value [30]. The first instance judge should have proceeded to assess the value of the lost claim on a loss of opportunity basis. The court therefore dismisses the appeal and remits the matter for that assessment [32].

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For some four centuries, the United Kingdom and its component nations have been a major source of emigration. As a result, schemes for defining the right to British nationality have been complicated by the need to accommodate those born abroad but having significant connections with the United Kingdom by descent. Until 1983, the basic principle was that British nationality by descent was available to any person whose father was a citizen of the United Kingdom and Colonies. But if his father was himself a citizen by descent only, then unless the child was born in a British controlled territory or the father was in Crown service at the time of the birth, it was normally a condition that the birth should be registered at a British consulate within a year. In no case could citizenship by descent be transmitted through the female line. Regulations governing the registration of births by British consuls restricted registration to those eligible for British citizenship. The respondent, Shelley Elizabeth Romein, was born in the United States on 16 June 1978. Her father was a US citizen with no personal connection to the United Kingdom. Her mother had been born in South Africa and was a citizen of the United Kingdom and Colonies by descent because her father (Ms Romeins grandfather) had been born in the United Kingdom on 1 November 1905. Ms Romeins mother swore an affidavit in which she said that while pregnant with her she spent some time in South Africa and contacted the British consulate in Johannesburg to enquire about British citizenship for her unborn child. She was told, correctly, that the child would not be eligible because her only claim by descent was through her mother. With effect from 1 January 1983, the restriction to descent in the male line was abrogated by legislation for those born after that date, and 20 years later in 2003 the legislation was retrospectively amended so as to allow those born before 1983 to acquire citizenship through the female line. However, when Ms Romein, who had been born under the old regime, sought to take advantage of the change in 2013, her application for citizenship was rejected on the ground that she was unable to satisfy the statutory condition of registration within a year. The reason why she was unable to do so was that although the law was now deemed at all material times to have allowed claims to citizenship by descent through the female line, the staff of British consulates, acting entirely properly under the law as it actually was, would have refused to register her birth because she was ineligible. A result so paradoxical clearly calls for scrutiny. Legislative history The exclusion of claims to British citizenship by descent through the female line is a curious survivor of redundant social and political priorities. At common law, English nationality was based on allegiance. It was acquired by birth within the Kings realm or by marriage to an Englishman. Nationality by descent was wholly statutory and available under a statute of 1351 only where the child was born outside the realm to parents both of whom were English: see 25 Ed III, cap 1. It followed that an English woman who married an alien could not transmit her English nationality to her child born outside the realm. The Naturalization Act 1870 abolished the common law principle that allegiance was indelible, and provided for a woman to lose her British nationality upon marriage to an alien. From this it followed that no question could arise of transmission of British citizenship by descent through the female line alone. The position was formalised by the British Nationality and Status of Aliens Act 1914, which was the first statute comprehensively regulating eligibility for British nationality. A valuable account of the historical background to this legislation will be found in M P Baldwin, Subject to Empire: Married Women and the British Nationality and Status of Aliens Act, Journal of British Studies, xl (2001), 522. The Act arose from the Imperial Conference of 1911, in which the United Kingdom and the Dominions had agreed upon the principle of a common imperial nationality. A number of its provisions reflected concern among the Dominions that a common imperial nationality would undermine their attempts to restrict the right of entry by undesirables. The common nationality was therefore restricted with a view to meeting these concerns. The 1914 Act repealed the statute of 1351. Section 10 reproduced the effect of the Naturalization Act 1870 by providing that the British wife of an alien would become an alien on her marriage. Consistently with these provisions, section 1(1) of the 1914 Act as originally enacted defined a British subject as (a) any person born within His Majestys dominions and allegiance, and (b) any person born elsewhere whose father was a British subject. This provision was amended by the British Nationality and Status of Aliens Acts of 1918 and 1922. In its final form, the Act made (b) dependent on the father satisfying any one of five conditions, the most significant of which was condition (v), which was that the birth of a child born outside His Majestys dominions must be registered at a British consulate within a year or in special circumstances and with the consent of the Secretary of State within two years. Section 1 of the British Nationality and Status of Aliens Act 1943, repealed condition (v) and replaced it with a provision to substantially the same effect but authorising the Secretary of State to permit registration at any time. The Report of the Joint Select Committee on the Nationality of Married Women (24 July 1923) recorded the main reasons advanced by the Foreign Office in support of these measures: the dominant role of the husband in shaping the cultural affiliation of the family, the problems under British diplomatic practice of affording consular protection to British citizens with dual nationality, the need to maintain commonalty with the Dominions and the desirability of deterring certain mixed marriages which were in the womens case nearly always most undesirable. The Act of 1914 was superseded with effect from 1 January 1949 by the British Nationality Act 1948, which was the statute in force at the time of Ms Romeins birth. The occasion for the new Act was the Commonwealth Conference of 1947 on nationality and citizenship, which agreed that each of the Dominions should in future legislate for its own citizenship instead of sharing in a common British citizenship. This made it possible for the new Act to abrogate the rule that British women who married aliens lost their nationality. But it did not alter the basic principles on which citizenship by descent was available. Section 5 provided: 5.(1) Subject to the provisions of this section, a person born after the commencement of this Act shall be a citizen of the United Kingdom and Colonies by descent if his father is a citizen of the United Kingdom and Colonies at the time of the birth: Provided that if the father of such a person is a citizen of the United Kingdom and Colonies by descent only, that person shall not be a citizen of the United Kingdom and Colonies by virtue of this section unless (a) that person is born or his father was born in a protectorate, protected state, mandated territory or trust territory or any place in a foreign country where by treaty, capitulation, grant, usage, sufferance, or other lawful means, His Majesty then has or had jurisdiction over British subjects; or (b) that persons birth having occurred in a place in a foreign country other than a place such as is mentioned in the last foregoing paragraph, the birth is registered at a United Kingdom consulate within one year of its occurrence, or, with the permission of the Secretary of State, later; or (c) that persons father is, at the time of the birth, in Crown service under His Majestys government in the United Kingdom; or that person is born in any country (d) mentioned in subsection (3) of section one of this Act in which a citizenship law has then taken effect and does not become a citizen thereof on birth. If the Secretary of State so directs, a birth shall be (2) deemed for the purposes of this section to have been registered with his permission notwithstanding that his permission was not obtained before the registration. Nothing was done to remedy the inability of women to transmit British nationality by descent until 1979. Under section 7(1) of the Act of 1948 the Secretary of State had a discretion to cause a minor child of a British citizen to be registered as a British subject on the application of his or her parent or guardian. On 7 February 1979, Mr Merlyn Rees, the then Home Secretary, made a written statement in the House of Commons that he would in future exercise this discretion in favour any minor child of a woman who was herself born in the United Kingdom. He added that in due course legislation would be introduced to address more generally the transmission of citizenship in the female line: Hansard HC vol 962, cols 203 204W. Since Ms Romeins mother had not been born in the United Kingdom, this change of policy made no difference to her situation. Neither did the promised legislation, when it was eventually enacted. The British Nationality Act 1981, which came into force on 1 January 1983, removed the limitation to descent through the male line for the future. It also abolished acquisition of nationality by children of British nationals by descent by the registration of their births at a consulate. For a five year transitional period nationality could still be acquired in similar circumstances by registration with the Secretary of State (but still restricted, as before 1983, to descent through the male line). In April 1986, the United Kingdom ratified the United Nations Convention on the Elimination of All Forms of Discrimination Against Women. Article 9.2 of the Convention required state parties to grant equal rights to men and women with respect to the nationality of their children. However, the United Kingdoms ratification was subject to a reservation that it would continue to apply the five year transitional provision in the Act of 1981. Those born before the commencement of the 1981 Act continued to benefit from the Rees policy until the end of 2000, when the last person born while the 1948 Act was in force ceased to be a minor. There was then a hiatus of some two years until 30 April 2003, when section 13 of the Nationality, Immigration and Asylum Act 2002 came into force. This retrospectively amended the Act of 1981 by inserting a new section 4C. Section 4C was subsequently replaced by a revised section 4C to similar but not identical effect, which was introduced into the 1981 Act by section 45(3) of the Borders, Citizenship and Immigration Act 2009. In this form it was in force at the time of Ms Romeins application, and indeed still is. It provides as follows: 4C Acquisition by registration: certain persons born before 1983 (1) A person is entitled to be registered as a British citizen if (a) he applies for registration under this section, and (b) he satisfies each of the following conditions. (2) The first condition is that the applicant was born before 1 January 1983. (3) The second condition is that the applicant would at some time before 1 January 1983 have become a citizen of the United Kingdom and Colonies (a) under section 5 of, or paragraph 3 of Schedule 3 to, the 1948 Act if assumption A had applied, (b) under section 12(3), (4) or (5) of that Act if assumption B had applied and as a result of its application the applicant would have been a British subject immediately before 1 January 1949, or (c) under section 12(2) of that Act if one or both of the following had applied (i) assumption A had applied; (ii) assumption B had applied and as a result of its application the applicant would have been a British subject immediately before 1 January 1949. (3A) Assumption A is that (a) section 5 or 12(2) of, or paragraph 3 of Schedule 3 to, the 1948 Act (as the case may be) provided for citizenship by descent from a mother in the same terms as it provided for citizenship by descent from a father, and (b) references to the applicants mother. references in that provision to a father were (3B) Assumption B is that (a) a provision of the law at some time before 1 January 1949 which provided for a nationality status to be acquired by descent from a father provided in the same terms for its acquisition by descent from a mother, and (b) references to the applicants mother. references in that provision to a father were (3C) For the purposes of subsection (3B), a nationality status is acquired by a person (P) by descent where its acquisition (a) depends, amongst other things, on the nationality status of one or both of Ps parents, and (b) does not depend upon an application being made for Ps registration as a person who has the status in question. (3D) For the purposes of subsection (3), it is not to be assumed that any registration or other requirements of the provisions mentioned in that subsection or in subsection (3B) were met. (4) The third condition is that immediately before 1st January 1983 the applicant would have had the right of abode in the United Kingdom by virtue of section 2 of the Immigration Act 1971 (c 77) had he become a citizen of the United Kingdom and Colonies as described in subsection (3) above. (5) For the purposes of the interpretation of section 5 of the 1948 Act in its application in the case of assumption A to a case of descent from a mother, the reference in the proviso to subsection (1) of that section to a citizen of the United Kingdom and Colonies by descent only includes a reference to a female person who became a citizen of the United Kingdom and Colonies by virtue of section 12(2), (4) or (6) only of the 1948 Act, section 13(2) of that Act, (a) (b) (c) paragraph 3 of Schedule 3 to that Act, or (d) (No 2) Act 1964. section 1(1)(a) or (c) of the British Nationality In other words, applications for citizenship by descent through the female line are now to be dealt with on the assumption that the law had always provided for citizenship by descent from the mother on the same terms as it provided for citizenship by descent from the father. Application to Ms Romeins case The paradox of the Secretary of States decision in the present case is that although section 4C(3)(a) of the 1981 Act (as amended) and the associated Assumption A require her to assume that section 5 of the 1948 Act had always provided for citizenship by descent from a mother in the same terms as it provided for citizenship by descent from a father, nevertheless an application for citizenship on that basis must fail because no such assumption would or could have been made by the officials responsible for registration at the time. To this conundrum there are logically only three possible solutions: (1) Section 4C requires one to assume not only that section 5 of the 1948 Act had always provided for citizenship by descent in the female line, but that the historic facts were different, ie that consular officials in fact acted on that basis. The argument is that in terms of subsection (3) Ms Romein would have become a citizen under section 5 of the 1948 Act if Assumption A had applied, because on that hypothesis consular officials would have registered her. This is Ms Romeins case, which was substantially adopted by the Inner House. (2) Section 4C requires one to assume only that section 5 of the 1948 Act had always provided for citizenship by descent, but not to make any assumption that the facts were other than they were. The result is that applications based on descent through the female line must fail in every case where citizenship was dependent on the fact of registration under section 5(1)(b). This is the case which the Advocate General makes in support of the Secretary of States decision, and which was substantially accepted by the Lord Ordinary. (3) Effect cannot be given to the registration condition in section 5(1)(b) of the 1948 Act at all, as applied to applications for citizenship by descent through the female line, because insisting on that condition would nullify the practical effect of making Assumption A. This possibility was raised with Counsel in the course of argument before us, but does not appear to have been considered below. I start with the first hypothesis, which is the one that found favour with the Inner House. There are formidable difficulties about the counterfactual assumption on which this hypothesis depends. In the first place, Ms Romeins contention is that on the assumption made about the law in Assumption A, she would have acquired citizenship under section 5(1)(b) of the 1948 Act. No other provision of that Act could be relevant to her case. The registration condition is an integral part of section 5(1)(b). If any effect is to be given to it, the only counterfactual assumption that would enable her application to succeed is that consular officials not only made Assumption A but actually registered the applicant as a British citizen. But that assumption cannot be made consistently with subsection (3D), because registration is one of the requirements of section 5 of the 1948 Act, which is one of the provisions mentioned in subsection (3). It follows that the decision maker cannot assume that the registration condition was met. Since without such an assumption, one is left with the fact that she was not registered, she would not have become a citizen. I cannot accept the view of the Inner House that subsection (3D) is concerned only to cast on the applicant the burden of proving his or her claim, without the assistance of any presumption of fact. It does not say this. Moreover, she would have that burden anyway. Secondly, on the present hypothesis the question whether an applicant would have acquired citizenship under section 5(1)(b) of the 1948 Act if Assumption A is made, depends not just on what action consular registrars would have taken if the law had been in accordance with Assumption A, but on what steps the childs parents would have taken to have her registered on that assumption. It so happens that in Ms Romeins case the answer is reasonably clear if her mothers affidavit is accepted. Her mother would have received a different answer to her enquiry of the Johannesburg consulate and would have sought to register the birth. If consular officials had made Assumption A in 1978, that attempt would have succeeded. It is clear that Ms Romeins mother not only attached a high value to her unborn childs future nationality, but not realising the legal impediments, took some steps towards registering her. Someone who knew about the legal impediments would have done nothing and generated no evidence of this kind. Yet it is not obvious why that should make any difference. There is a conceptual problem about making the operation of section 4C dependent on an enquiry conducted years later into the question whether a parent would before 1983 have wished or intended or attempted to avail herself of a right which did not then exist. Thirdly, that problem is immeasurably increased when one examines the other implications of this approach. Subsection (3D) applies to all the provisions mentioned in section 5 of the 1948 Act, including sections 5(1)(a) and (c). There is nothing to suggest that claims under these provisions fall to be treated differently from those made under section 5(1)(b). If the counterfactual assumption to be made includes the steps which the parents would have taken, then it would be open to an applicant to say that had the law allowed citizenship by descent in the female line the mother would have moved to a British controlled territory for the birth so as to qualify under section 5(1)(a), or one or other parent would have entered or continued in Crown service in time for the birth so as to qualify under section 5(1)(c). It seems extremely unlikely that Parliament envisaged in 2002 or 2009 that the operation of this provision would depend on the practically unanswerable question what adjustments parents would hypothetically have made to their lives with a view to obtaining British citizenship for their children. Subsection (3D) appears to have been added precisely to rule out any such unrealistic enquiries. In my view the only counter historical assumptions authorised by the Act are Assumptions A and B. However, the Advocate Generals case faces, as it seems to me, equally formidable objections. He submits that Assumption A requires section 5 of the 1948 Act to be read as providing for citizenship by descent from a mother in the same terms as it provided for citizenship by descent from a father. Since those terms included the registration condition in section 5(1)(b), effect must be given to that condition. Subsection (3D) then provides that it is not to be assumed that these terms, including the registration condition, have been met. In the absence of a statutory assumption to that effect, he submits, the applicant must demonstrate that the terms, including the registration condition, have in fact been met, just as a claimant to citizenship by descent from a father would have to do. This accords with the literal words of section 4C. The difficulty about it is that while purporting to give effect to section 5(1)(b), its actual result is to make section 4C inapplicable to substantially all claims based on it. Section 4C(3)(a) assumes that by making Assumption A it will in principle be possible to claim citizenship by descent under section 5 of the 1948 Act, including section 5(1)(b). But if (as the Advocate General submits) effect must be given to the registration condition in section 5(1)(b) of the 1948 Act, then citizenship by descent through the female line would be available under section 5(1)(b) only in those anomalous cases where persons claiming descent through the female line were registered at a British consulate by mistake or in defiance of the regulations. There were apparently a few such cases. It is difficult to discern any rational reason why the legislature should have intended to help only them. Yet, except in cases where the birth of an ineligible child was registered unlawfully, the effect of the Advocate Generals reading is to close off section 5(1)(b) as a route to citizenship by descent from a mother. Mr Johnston QC, who appeared for the Advocate General, suggested at one point that the intention was to allow claims to citizenship by descent from a woman only in the cases covered by section 5(1)(a), (c) or (d) of the 1948 Act where citizenship followed automatically from a specified state of affairs and was not dependent on steps being taken by any human actor. But the problem about this argument, apart from being inconsistent with his primary argument (that the registration condition in section 5(1)(b) must be given effect), is that if it was intended to rule out all applications under section 4C based on section 5(1)(b) of the 1948 Act, the provision as drafted would be a most extraordinary way of doing it. The obvious course would have been to limit the reference to section 5 of the 1948 Act in section 4C of the 1981 Act (as amended) to section 5(1)(a), (c) and (d). In fact, it must be in the highest degree unlikely that Parliament entertained any such intention. Since section 5(1)(b) of the 1948 Act seems likely to be the basis of a large proportion of applications under section 4C of the 1981 Act (as amended), it would have significantly undermined the purpose of the provision, for no reason that can readily be imagined. I think that the solution to the paradox is more straightforward than either of these hypotheses. Because section 4C requires one to assume that section 5 of the 1948 Act had always provided for citizenship by descent in the female line, it is not possible to apply the registration condition in section 5(1)(b) of the 1948 Act to those claiming on that basis, because its application would make nonsense of that assumption. The past is done, and cannot be undone. For nearly 70 years, British consuls have declined to register the births of those claiming by descent through the female line. Throughout that period any purported registration of a person claiming citizenship only through the female line would have been legally ineffective. Given that we are forbidden by section 4C(3D) to assume contrary to the facts that the birth was in fact registered, the only way in which effect can be given to section 4C(3) is I should, finally, notice two objections urged against this analysis, neither of to treat the registration condition in section 5(1)(b) as being inapplicable in cases where citizenship is claimed by descent from a mother. which I would accept. The first objection is that it leads to unacceptable discrimination between those born before and after the 1948 Act came into force on 1 January 1949. This is because claims to citizenship by descent from a mother by persons born before 1 January 1949 are governed by section 4C(3)(b) and (c) of the 1981 Act (as amended). These provisions deal with claims based on section 12(2) (5) of the 1948 Act, which provide subject to certain conditions for persons who were British subjects immediately before the commencement of the 1948 Act to become Citizens of the United Kingdom and Colonies on the commencement date. The status of British subjects immediately before 1 January 1949 was governed by the 1914 Act, which contained provisions for citizenship by descent similar to those of the 1948 Act. Section 4C(3)(b) and (c) of the 1981 Act (as amended) provides for Assumption B to be made where an applicant was born before 1 January 1949. Assumption B is that the law in force before 1 January 1949, ie section 1 of the Act of 1914, provided for a nationality status to be acquired by descent from the mother on the same terms as from a father. For this purpose, section 4C(3C) of the 1981 Act (as amended) provides that a nationality status is acquired by descent where its acquisition depends on the nationality status of one or both parents and does not depend upon an application being made for registration as a person who has that status. The Advocate General submits that in the case of persons born before 1 January 1949 this rules out claims to citizenship by descent through the female line based on reading section 1(1)(b)(v) of the 1914 Act (which applied a condition of registration for any person born outside His Majestys dominions) in accordance with Assumption B. The Inner House rejected this argument because section 1(1)(b)(v) of the 1914 Act did not require anything that could properly be described as an application for registration. An application, they thought, suggested an appeal to discretion whereas registration of the birth of an eligible child was a right. They concluded that subsection (3C) must be taken to refer to the registration of a person as having British nationality by naturalisation under regulations envisaged by section 19(1) of the 1914 Act. This may be so, although it is right to point out that section 1(1)(b)(v) of the 1914 Act is the only statutory provision in force before 1 January 1949 which referred to registration as a requirement for British nationality by descent. I should, however, prefer not to decide this point. It does not affect Ms Romeins case. For the purposes of this appeal, it is enough to point out that the provisions of subsection (3C) referring to the claims of those born before 1 January 1949 and those of subsection (3D) referring to the claims of those born after that date are in different terms. If there is any difference between the treatment of the two categories under section 4C of the 1981 Act (as amended), it arises from differences in the language of the two subsections. It is not anomalous. The second objection is that failing to apply the registration condition to those claiming under section 4C would lead to a different form of gender discrimination, because claimants through the female line would be free of the registration condition whereas claimants through the male line under the previous law were not. In other words there would be a difference of treatment between (i) persons who could have been registered as citizens because their fathers were citizens, but for whatever reason were not, and can do nothing about it, and (ii) persons who could not have been registered because their only claim was through their mother, in relation to whom no registration condition arises. I do not regard this as anomalous either. There is no discrimination between applicants, whether by gender or otherwise. There was historic discrimination between their parents, since a father was held to transmit his citizenship to his children while a mother was not. Section 4C simply corrects the subsisting consequences for their children of this historic discrimination. There is no question of current discrimination. Disposal I would dismiss the appeal and affirm the decision of the Inner House, albeit for the rather different reasons which I have given.

Under section 5(1) of the British Nationality Act 1948 the general rule was that British citizenship was available to a person by descent if his or her father was a citizen of the United Kingdom and Colonies at the time of the persons birth. But, if the persons father was himself a citizen by descent only, then unless either the person was born in a British controlled territory or the father was in Crown service at the time of the birth, it was normally a condition under section 5(1)(b) that the persons birth should be registered at a British consulate within a year. Citizenship by descent could not be transmitted through the female line. Regulations permitted a British consul to register a birth only if the child was eligible for British citizenship. The Respondent, Shelley Elizabeth Romein, was born in the USA in 1978. The 1948 Act was in force at that time. Ms Romeins father was a US citizen with no personal connection to the UK. Her mother had been born in South Africa and was a citizen of the United Kingdom and Colonies by descent, because her father (Ms Romeins grandfather) had been born in the UK. Ms Romeins mother swore an affidavit in which she said that, while pregnant with her and in South Africa, she contacted the British consulate in Johannesburg to enquire about British citizenship for her unborn child. She was correctly told that the child was ineligible because her only claim by descent was through her mother. The British Nationality Act 1981 removed the restriction to descent through the male line for those born after 1 January 1983 (subject to a five year transitional period). The 1981 Act was amended retrospectively in 2003 and 2009. Section 4C of the amended 1981 Act, as it stood when Ms Romein applied for citizenship and as it now stands, requires applications for citizenship to be dealt with on the assumption that the law had always provided for citizenship by descent from the mother on the same terms as it provided for citizenship by descent from the father. However, in 2013 when Ms Romein sought to take advantage of the change, her application for citizenship was rejected because she was unable to satisfy the condition of registration within a year. The reason why she was unable to do so was that although the law was now deemed at all material times to have allowed claims to citizenship by descent through the female line, at the time of Ms Romeins birth in 1978 the staff of British consulate, acting entirely properly under the law as it actually was, would have refused to register her birth because she was ineligible for citizenship. Ms Romein applied for judicial review of the decision refusing her citizenship application. The Lord Ordinary dismissed that application for judicial review. Ms Romein appealed to the Inner House of the Court of Session which allowed her appeal, quashed the refusal of her citizenship application, and remitted her citizenship application for reconsideration. The Supreme Court unanimously dismisses the appeal, although for reasons other than those given by the Inner House. Lord Sumption gives the judgment, with which Lady Hale, Lord Reed, Lord Hodge and Lady Black agree. The refusal of Ms Romeins citizenship application, notwithstanding the assumption in section 4C, on the ground that the consular staff would have properly refused to register her birth is a paradoxical result, calling for scrutiny [3]. There are logically only three possible solutions to this conundrum [9]. The first approach is that Section 4C requires one to assume not only that the law had always provided for citizenship by descent through the female line, but that consular officials at the time in fact acted on that basis. This is Ms Romeins case, which the Inner House substantially adopted [9(1)]. This involves formidable difficulties. First, the counterfactual assumption that the consular officials would have registered the birth is inconsistent with section 4C(3D), according to which it is not to be assumed that the registration requirement was met. The Court cannot accept the view of the Inner House that section 4C(3D) serves only to cast on the applicant the burden of proving his her of claim without the assistance of any presumption of fact. Subsection (3D) does not say that. Moreover, the applicant would bear the burden of proving his or her claim anyway. Second, there is a conceptual problem about making the operation of section 4C dependent on an enquiry conducted years later into the question of whether a parent would have wished or intended or attempted to take advantage of a then non existent right. Third, if the counterfactual assumption includes an assumption about the steps which the parents would have taken with a view to obtaining British citizenship for their children, then it would be open to an applicant to seek citizenship by descent on the basis that the mother would have moved to a British controlled territory for the birth, or that a parent would have entered or continued in Crown service in time for the birth. It seems extremely unlikely that Parliament expected the operation of section 4C to depend on that practically unanswerable question. Subsection (3D) appears to have been added precisely to rule out such unrealistic enquiries [10]. The second approach is that section 4C requires one to assume only that the law had always provided for citizenship by descent, but not to make any assumption that the facts were other than they actually were. This is the Advocate Generals case, which the Lord Ordinary substantially adopted. This accords with the literal words of section 4C, but its result is that citizenship by descent through the female line would be available under section 5(1)(b) of the 1948 Act only where persons were registered by mistake or in defiance of the regulations. It is difficult to see why Parliament should have intended to help only them. The Court cannot accept the suggestion that the intention behind section 4C was to allow claims to citizenship by descent from a woman only in cases where citizenship followed automatically from certain specified circumstances and was not dependent on a person taking steps, such as registering a birth. Section 4C as drafted would be an extraordinary way of doing that. Parliament is highly unlikely to have had any such intention. It would have significantly undermined the purpose of section 5(1)(b) of the 1948 Act for no discernible reason [9(2) 11]. The solution is to treat the registration condition in section 5(1)(b) as inapplicable in applications for citizenship by descent from the mother. This is the only way to give effect to section 4C(3), given that section 4C(3D) precludes any counterfactual assumption that the birth was registered [9(3) 12]. There are two objections to this solution. The Court accepts neither. The first is that it is said to lead to unacceptable discrimination between those born before and after the 1948 Act came into force. The Court prefers not to decide this point. It does not affect Ms Romeins case. It is enough to point out that, if there is any difference between the treatment of those two categories of people, it arises from the wording of the 1981 Act (as amended) [13 14]. The second objection is that this solution leads to a different form of gender discrimination, because claimants through the female line would be free of the registration condition whereas claimants through the male line under the previous law were not. This is not anomalous either: there is no current discrimination between applicants. There was historic discrimination between their parents. Section 4C simply corrects the remaining consequences [13, 15].

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The claimant, Declan OByrne, was vaccinated on 3 November 1992 with an HIB vaccine (the Product). He alleges that the Product was defective and that it caused him brain damage. The vaccine in question was manufactured in France by a French company, now known as Aventis Pasteur SA (APSA). On 18 September 1992 APSA sent a consignment of the vaccine, including the Product, to a company, now known as Aventis Pasteur MSD Ltd (APMSD), in England. At all relevant times in 1992 APMSD was a wholly owned subsidiary of APSA and acted as a United Kingdom distributor for APSAs products. APMSD received the consignment on 22 September. On an unknown date, probably in late September or early October, APMSD sold part of the consignment, including the Product, to the Department of Health, which in turn supplied it to the medical practice which used it to vaccinate the claimant. On 1 August 2001 the claimant began proceedings for damages against APMSD, alleging that he had suffered damage caused by a defect in the Product which APMSD had manufactured and/or produced and so it was liable under section 2 of the Consumer Protection Act 1987. In its defence, served in November 2001, APMSD pointed out that it was not the manufacturer, but merely the distributor, of the Product. In response to a further request, in April 2002 APMSD identified APSA as the manufacturer of the Product. On 16 October 2002 the claimant issued separate proceedings against APSA, also under section 2 of the Consumer Protection Act, alleging that APSA was the producer of the Product and claiming damages against it. APSA defended the action on the basis, inter alia, that it had put the Product into circulation either on 18 September 1992, when it sent the Product to APMSD, or on 22 September 1992 when APMSD received it. APSA contended that, in these circumstances, the claimants action against it was time barred since it had been raised more than 10 years after APSA had put the Product into circulation. In advancing this defence, APSA relied on section 11A(3) of the Limitation Act 1980 and Article 11 of Council Directive 85/374/EEC of 25 July 1985 on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products (OJ 1985 L210, p 29) (the Directive), which provides: Member States shall provide in their legislation that the rights conferred upon the injured person pursuant to this Directive shall be extinguished upon the expiry of a period of ten years from the date on which the producer put into circulation the actual product which caused the damage, unless the injured person has in the meantime instituted proceedings against the producer. Faced with this defence in his action against APSA, in his action against APMSD with which this appeal is concerned the claimant applied on 10 March 2003 for an order that APSA be substituted as defendant in place of APMSD. The application was based on section 35(5)(b) and (6)(a) of the Limitation Act 1980 and rule 19.5(3)(a) of the CPR. It is, of course, common ground that the application was made after the expiry of the ten year time limit under Article 11 for initiating proceedings against the producer of the Product. In these circumstances APSA contended that, in so far as English law might permit APSA to be substituted after the expiry of the time limit, it was inconsistent with Article 11. By contrast, the claimant contended that provisions of domestic law permitting this substitution would not be inconsistent with Article 11. In November 2003, at the request of both parties, the High Court made a preliminary reference to the European Court of Justice. The European Court answered three questions: OByrne v Sanofi Pasteur MSD Ltd (formerly Aventis Pasteur MSD Ltd) (Case C 127/04) [2006] 1 WLR 1606. One of the questions concerned the point in time at which a product was put into circulation for purposes of Article 11 in a situation where the producer which manufactured it then transferred it to a distribution subsidiary. I quote and discuss the European Courts ruling on this point at paras 20 23 below. concerned, the European Court held, [2006] 1 WLR 1606, 1622: So far as the power to substitute one producer for another as defendant was When an action is brought against a company mistakenly considered to be the producer of a product whereas, in reality, it was manufactured by another company, it is as a rule for national law to determine the conditions in accordance with which one party may be substituted for another in the context of such an action. A national court examining the conditions governing such a substitution must, however, ensure that due regard is had to the personal scope of Directive 85/374, as established by Articles 1 and 3 thereof. In the light of this answer, Teare J allowed the claimants application for substitution of APSA in place of APSMD, pursuant to section 35(5)(b) and (6)(a) of the Limitation Act 1980 and rule 19.5(3)(a) of the CPR, on the ground that the claimant had named APMSD as the defendant in mistake for APSA: OByrne v Aventis Pasteur MSD Ltd [2007] 1 WLR 757. APSA appealed, but the Court of Appeal (Sir Anthony Clarke MR, Arden and Moore Bick LJJ) [2008] 1 WLR 1188 dismissed its appeal. The House of Lords granted APSA leave to appeal. At the hearing of the appeal a majority of the appellate committee considered that it was clear that the European Court was saying that, in some circumstances, proceedings, which are obviously intended to be proceedings against the producer but which use the wrong name, can properly be treated by national procedural law as having been proceedings against the producer. The majority considered that this would have been the proper approach in the circumstances in the present case and so they would have dismissed APSAs appeal. But, because this was not the unanimous view of the appellate committee as to the effect of the judgment of the European Court, the House of Lords referred the case to Luxembourg for a second time: [2008] 4 All ER 881. The decision on this reference was given by the Grand Chamber: Aventis Pasteur SA v OB (Case C 358/08) (unreported) given 2 December 2009. The answer returned by the European Court in response to the second reference is not in line with either of the interpretations of its judgment on the first reference which had been advanced before the appellate committee. Happily, however, this time the core answer could not be clearer: Article 11 of Council Directive 85/374/EEC of 25 July 1985 on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products must be interpreted as precluding national legislation, which allows the substitution of one defendant for another during proceedings, from being applied in a way which permits a producer, within the meaning of Article 3 of that directive, to be sued, after the expiry of the period prescribed by that article, as defendant in proceedings brought within that period against another person. Putting the point shortly and subject to the important qualification which I must address in a moment the Court of Justice holds that, once ten years have passed since a producer put a product into circulation, that producer cannot be sued, unless proceedings have been taken against it within the ten year period. As the Court explains, at para 38 of its judgment, Article 11: provides for a uniform 10 year period after which those rights are extinguished. It fixes, in a binding manner, the starting point of that period as the date on which the producer put into circulation the product which caused the damage. It specifies the institution of proceedings against that producer as the only reason for that period to be interrupted. It follows, as the Court says at para 44, that a rule of national law which allows the substitution of one defendant for another during proceedings cannot, under Directive 85/374, be applied in a way which permits such a producer to be sued, after the expiry of that period, as defendant in proceedings brought within that period against another person. As it explained in paras 41 43 of its judgment, the Court adopted this approach because, in its view, it gave effect to the balance which the Community legislator had intended to achieve between the interests of consumers and producers: 41. Pursuant to the 11th recital in the preamble to Directive 85/374, the latter seeks, second, to limit, at Community level, the liability of the producer to a reasonable length of time, having regard to the gradual ageing of products, the increasing strictness of safety standards and the constant progressions in the state of science and technology. 42. As is stated by the Advocate General in points 49 and 50 of her Opinion, the Community legislatures intention to limit in time the no fault liability established by Directive 85/374 is also intended to take account of the fact that that liability represents, for the producer, a greater burden than under a traditional system of liability, so as not to restrict technical progress and to maintain the possibility of insuring against risks connected with that specific liability (see, to that effect, paragraph 3.2.4 of the Report from the Commission of 31 January 2001 on the Application of Directive 85/374 on Liability for Defective Products, COM (2000) 893 final). 43. It follows that, without prejudice to the possible application of the rules on contractual or non contractual liability or a special liability system existing at the moment when Directive 85/374 was notified, the application of which is not prejudiced by the latter, as is apparent from Article 13 thereof and the 13th recital in the preamble thereto, the producer, as defined in Article 3 of that directive, is, under Article 11 of that directive, relieved of his liability under that article upon the expiry of a period of 10 years from the putting into circulation of the product in question, unless, in the meantime, proceedings have been instituted against him. The European Court also went out of its way, at para 48, to emphasise that it made no difference if the failure to sue a particular producer within the relevant ten year period had been due to some mistake on the claimants part. Even in that event what mattered was that the ten years had expired without that producer having been sued. So it could not be substituted as defendant after the ten years were up: 48. It should also be added that subjective elements deriving, for example, from the wrongful attribution, by the injured person, of the status of manufacturer of the allegedly defective product to a company which is not the manufacturer, or from the injured persons genuine intention to proceed against that manufacturer by way of its action against such other company, cannot, without infringing the objective dimension of the harmonisation rules laid down by Directive 85/374, justify the substitution, after the expiry of the 10 year period set out in Article 11 thereof, of that manufacturer in proceedings initiated during that period against another person (see, to that effect, OByrne, paragraph 26 and, by analogy, Case C 51/05 P Commission v Cantina sociale di Dolianova and Others [2008] ECR I 5341, paragraphs 59 to 63). In these circumstances the claimant now accepts that he cannot use section 35 of the Limitation Act 1980 as a basis for substituting APSA for APMSD as the defendant in the present proceedings. The claimant submits, however, that, even though he cannot make the substitution on the basis of his mistake, the European Court indicated in its judgment a different basis on which he can actually make the desired substitution. For this purpose he relies on the second answer which the Court of Justice gave on the second reference: However, first, Article 11 must be interpreted as not precluding a national court from holding that, in the proceedings instituted within the period prescribed by that article against the wholly owned subsidiary of the producer, within the meaning of Article 3(1) of Directive 85/374, that producer can be substituted for that subsidiary if that court finds that the putting into circulation of the product in question was, in fact, determined by that producer. In short, the claimant submits that the position falls within the terms of this qualification to the European Courts core answer on the effect of Article 11 and so there is nothing to prevent him from substituting APSA for APMSD on this basis. APSA contends, however, that this passage in the Courts judgment has to be interpreted in the context of the judgment as a whole and in the light of the Opinion of Advocate General Trstenjak, 8 September 2009, unreported, which preceded it. When that is done, APSA says, it can be seen that the qualification should be given a narrower interpretation, which would not allow substitution in this case. As will become apparent, in a case like the present, the possibility of substitution depends, to some extent, on various matters of fact concerning the relationship between the two entities. At the hearing before this Court, however, on the basis of what he now knows about the facts, the claimants counsel, Mr Maskrey QC, accepted that, if the Court were to conclude that APSAs interpretation of the European Courts judgment was correct, then its appeal against its substitution for APMSD should be allowed. The dispute between the parties turns, therefore, on the interpretation of paras 49 53 of the judgment of the European Court on the second reference: 49. In light of the foregoing, Article 11 of Directive 85/374 must be interpreted as precluding national legislation which allows the substitution of one defendant for another during proceedings from being applied in a way which permits a producer, within the meaning of Article 3 of that directive, to be sued, after the expiry of the period prescribed by that article, as defendant in proceedings brought within that period against another person. 50. However, the Court, giving a preliminary ruling on a reference, has jurisdiction, in the light of the information in the case file, to give clarifications to guide the referring court in giving judgment in the main proceedings (see, to that effect, Case C 366/98 Geffroy [2000] ECR I 6579, paragraph 20, and Case C 446/07 Severi [2009] ECR I 0000, paragraph 60). 51. It should be noted in that regard, first, that it is apparent from the reference for a preliminary ruling that APMSD (formerly Mrieux UK), which in 1992 supplied the vaccine which was administered to OB to the United Kingdom Department of Health, was, at that time, a wholly owned subsidiary of APSA (formerly Pasteur Mrieux). 52. In such a context, it is for the national court, in accordance with the applicable rules of national law on matters of proof, to assess whether the putting into circulation of the product in question was, in fact, determined by the parent company which manufactured it. 53. Where the national court notes that fact, Article 11 of Directive 85/374 does not preclude that court from holding that, in the proceedings instigated within the period prescribed by that article against the subsidiary under the system of liability laid down by that directive, the parent company, producer within the meaning of Article 3(1) of that directive, can be substituted for that subsidiary. Under reference to its reasoning in paras 34 48, in para 49 the European Court gave its core ruling on the construction of Article 11, which I have already discussed. The Court then went on, in the subsequent paragraphs, to give some additional guidance which it considered might be helpful to any domestic judges who were going to be dealing with this particular case. There is nothing, however, to suggest that, in these paragraphs, the Court was intending to depart from the principled approach which it had just been at such pains to develop and finally to formulate in para 49. What the Court says in paras 50 54 must therefore be read in the light of that core decision. In other words, the Court is explaining how that decision may fall to be applied, depending on the domestic courts assessment of the practical relationship between the manufacturer, APSA, and the distributor, APMSD. In venturing to give this additional assistance the European Court was following the lead of the Advocate General. Although the structure of her Opinion makes for repetition, it is clear that she, too, had concluded that only the bringing of proceedings against the particular producer could stop the Article 11 time bar from taking effect ten years after the producer had put the relevant product into circulation. See, in particular, paras 61 and 69 78 of her Opinion. So, in reaching its conclusion in para 49 of its judgment, the Court was following this aspect of the Advocate Generals reasoning. The Advocate General went on to hold, at para 68, that a substitution of the producer as a defendant when he has been released by the expiry of the ten year limitation period is equally incompatible with the Directive. She gave her reasoning for this conclusion at para 79, where she said that to allow the substitution of a producer against which proceedings had not been taken within the ten year period in place of a producer against which they had been taken would de facto be capable of also interrupting the limitation period in relation to producers. The upper temporal limit of liability for producers in Article 11 would thereby be broken through, and that is excluded in the light of the complete harmonisation of the field which is the aim of Directive 85/374. So, when reaching the comparable conclusion at paras 44 47 of its judgment, the European Court was, again, following the Advocate Generals approach. The Advocate General also gave some thought to how Article 11, thus interpreted, should be applied in a case, like the present, where the parent manufacturing producer (APSA) transferred the Product to a distributor (APMSD) which was its wholly owned subsidiary. In this connexion the Advocate General referred back to the judgment of the European Court on the first reference: OByrne v Sanofi Pasteur MSD Ltd (formerly Aventis Pasteur MSD Ltd) [2006] 1 WLR 1606. The first ruling in that judgment, at p 1622, had been in these terms: Article 11 of Council Directive 85/374/EEC of 25 July 1985 on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products is to be interpreted as meaning that a product is put into circulation when it is taken out of the manufacturing process operated by the producer and enters a marketing process in the form in which it is offered to the public in order to be used or consumed. This conclusion reflects what the Court says in para 27 of its judgment, which is, in turn, based on its reasoning in the preceding paras 20 26. Paragraphs 27 32, [2006] 1 WLR 1606, 1620 1621, are of importance in the present context: 27. In light of those considerations, a product must be considered as having been put into circulation, within the meaning of Article 11 of the Directive, when it leaves the production process operated by the producer and enters a marketing process in the form in which it is offered to the public in order to be used or consumed. 28. Generally, it is not important in that regard that the product is sold directly by the producer to the user or to the consumer or that that sale is carried out as part of a distribution process involving one or more operators, such as that envisaged in Article 3(3) of the Directive. 29. When one of the links in the distribution chain is closely connected to the producer, for example, in the case of a wholly owned subsidiary of the latter, it is necessary to establish whether it is a consequence of that link that that entity is in reality involved in the manufacturing process of the product concerned. 30. The examination of such a close relationship must not be influenced by the question whether or not distinct legal persons are involved. On the other hand it is of relevance whether those are companies carrying out different production activities or are, on the contrary, companies one of which, ie the subsidiary company, acts simply as a distributor or depository for the product manufactured by the parent company. It is for the national courts to establish, having regard to the circumstances of each case and the factual situation of the matter before them, whether the links between the producer and another entity are so close that the concept of producer within the meaning of Articles 7 and 11 of the Directive also includes that latter entity and that the transfer of the product from one to the other of those entities does not amount to putting it into circulation within the meaning of those provisions. 31. In any case, contrary to what is maintained by the defendants, the fact that the products are invoiced to a subsidiary company and that the latter, like any purchaser, pays the price, is not conclusive. The same applies to the question of knowing which entity is to be considered as owner of the products. 32. Therefore the reply to the first question must be that Article 11 of the Directive is to be interpreted as meaning that a product is put into circulation when it is taken out of the manufacturing process operated by the producer and enters a marketing process in the form in which it is offered to the public in order to be used or consumed. As can be seen from para 31 of the European Courts judgment, in the first reference APSA which naturally wanted to push the starting date for the ten year period back as far as possible was arguing that it had put the Product into circulation when it transferred the consignment containing the Product to APMSD in the period of 18 to 22 September 1992. In support of that argument APSA was pointing to the fact that APMSD had been invoiced for the consignment and had paid for it. The claimants counsel, who was, of course, contending for as late a date as possible for the Product being put into circulation, was contending that this had not happened until APMSD supplied it to the Department of Health. The European Court rejected any approach that was based on the formal legal relationship between the parent manufacturing producer and the subsidiary distributor. In particular, the Court emphasised, at para 30, that the fact that the manufacturer and the distributor were distinct legal entities was irrelevant. The national court had to look at all the links between the two entities and decide on that basis whether they were so close that, for the purposes of Article 11, the concept of the manufacturing producer (which would apply to APSA) really included the distributor (in this case, APMSD). In that event, even if the Product were transferred from one to the other, this would not mean that it had been taken out of the manufacturing process operated by the producer. So, applying the test in para 27 of that judgment, for the purposes of Article 11 the Product would not have been put into circulation by the manufacturing producer when it transferred it to the distributor. Obviously, the Courts concern was that, unless this were indeed the position, at least in the case of products with a long shelf life, by the time they were eventually put on the market by the distributor, a significant part of the ten year period for proceedings against the manufacturing producer might have elapsed. This would upset the balance which the Directive sought to maintain between the interests of the consumer and the producer. In paras 83 90 of her Opinion on the second reference, the Advocate General did indeed make use of this part of the Courts analysis in the first reference when considering how the domestic court might determine the date at which the Product was put into circulation. But she also used it for the rather different purpose of showing when a distribution subsidiary could be so closely involved with the parent producer that they could, in effect, be regarded as one for the purposes of Article 11. In that event, suing the subsidiary would be tantamount to suing the parent. In concrete terms, if that were the position in this case, by suing APMSD within the ten year period, the claimant would also have sued APSA within that period. So the Article 11 time bar would not bite and the claimant could, if he wished, substitute APSA for APMSD as defendant in the present action or, indeed, simply proceed with his (second) action against APSA. The Advocate Generals reasoning and conclusions on these matters are to be found in paras 109 113 of her Opinion: 109. If, by contrast, the national courts were to reach the conclusion in the main proceedings that a supplier such as APMSD was, because of its involvement in the manufacturing process operated by APSA, to be regarded together with APSA as a producer within the meaning of the first half of Article 3(1) of Directive 85/374, the bringing of proceedings in due time against APMSD would indeed have the effect of interrupting the limitation period in relation to APSA. 110. The decisive point here is the fact that a supplier who is sufficiently closely involved in the manufacturing process operated by the producer is to be classified together with the producer as a producer within the meaning of the first half of Article 3(1) of the directive. Because those two entities are to be regarded, in the light of the functional interpretation of the concept of producer, as one producer within the meaning of the first half of Article 3(1), the limitation period must also run in the same way for both entities. 111. In this connection the Court in OByrne, after carefully weighing up the interests of consumers and producers, synchronised the starting point of the 10 year limitation period under Article 11 of Directive 85/374 for the producer stricto sensu and the supplier who forms part of the manufacturing process by reference to the date on which the supplier puts the product into circulation. In the context of the same balancing of interests, the running of the limitation period must also be uniform. 112. Since the running of the limitation period under Article 11 of the directive is interrupted only by the bringing of proceedings, a uniform limitation period for the producer and supplier who are to be regarded together as a producer within the meaning of the first half of Article 3(1) presupposes that the bringing of proceedings against the supplier interrupts the running of the 10 year limitation period not only in relation to that supplier but also in relation to the producer in whose manufacturing process the supplier is involved. 113. Accordingly, my conclusion is that classification to be assessed by the national courts of the supplier of a product as its producer has the consequence that that supplier is liable under Article 1 of the directive for the damage caused by a defect in the product, regardless of whether he is classified as a producer within the meaning of Article 3(1) or a producer within the meaning of Article 3(3) of the directive. Classification of a supplier as a producer within the meaning of the first half of Article 3(1) of the directive has the further consequence that the 10 year limitation period for the producer in whose manufacturing process the supplier is involved does not start to run until the time when the supplier puts the product into circulation. At the same time, proceedings brought against that supplier will in that case interrupt the running of the limitation period under Article 11 of the directive in relation also to the producer in whose manufacturing process the supplier is involved. In the summary which she gives in para 115, the Advocate General repeats the conclusion which she reaches in para 113. Two points stand out. First, the Advocate Generals conclusion in paras 113 and 115 involves no departure from the principle that the Article 11 time bar can only be interrupted by bringing proceedings against the producer concerned. Secondly, when she contemplates the domestic court classifying a supplier as a producer within the meaning of Article 3(1), she contemplates the domestic court applying the approach of the European Court in its judgment on the first reference: OByrne v Sanofi Pasteur MSD Ltd (formerly Aventis Pasteur MSD Ltd) [2006] 1 WLR 1606. And as the Advocate General recalls at paras 111 and 113 according to that judgment, where the supplier forms part of the manufacturing process, the starting point of the ten year limitation period under Article 11 is fixed by reference to the date on which the supplier puts the product into circulation. Indeed, in the proceedings on the first reference, the claimant fought successfully to establish exactly that point. With this background in mind, it is appropriate to return to paras 51 and 52 of the European Courts judgment on the second reference: 51. It should be noted in that regard, first, that it is apparent from the reference for a preliminary ruling that APMSD (formerly Mrieux UK), which in 1992 supplied the vaccine which was administered to OB to the United Kingdom Department of Health, was, at that time, a wholly owned subsidiary of APSA (formerly Pasteur Mrieux). 52. In such a context, it is for the national court, in accordance with the applicable rules of national law on matters of proof, to assess whether the putting into circulation of the product in question was, in fact, determined by the parent company which manufactured it. It is correct to say that, unlike the Advocate General, the European Court does not actually refer to its answer to the first question on the first reference. But there is nothing whatever to suggest that it intended to depart in any way from that analysis. The assumption must therefore be that it falls to be applied where appropriate. Certainly, the Court supplies no alternative or additional theoretical analysis which could displace or supplement it. The European Court is concerned to show how the principle which it has just laid down would apply in relation to the substitution of APSA for APMSD. Certainly, to judge by the Advocate Generals analysis and there is no rival the only way in which that principle could be maintained and yet APSA could be substituted for APMSD, would be if, by suing APMSD, the claimant had, in effect, sued APSA. So the Court must be pointing the domestic court to the way in which it should approach that issue. Mr Maskrey argued, however, that the position was really much simpler. As the European Court noted, at para 51, APMSD was a wholly owned subsidiary of APSA. Secondly, APSA had determined that the Product should be put into circulation by transferring it to its wholly owned subsidiary, APMSD, and it had then in fact transferred the product to the subsidiary. So the requirements of paras 51 and 52 were fulfilled and the substitution could be made. I would reject that argument. As counsel freely admitted, this argument runs completely counter to the one which the claimant advanced on the first reference. That is, of course, merely a forensic point. More significantly, the argument is internally incoherent as well as being inconsistent with the reasoning of the Court of Justice. If, as counsel now contends, APSA put the Product into circulation when it supplied it to APMSD, then, consistently with the Courts ruling on the first reference, this can only be because the two companies are to be regarded as having operated quite distinctly so that the Product was taken out of the manufacturing process operated by APSA when it was transferred to APMSD. But the fact that APMSD was a wholly owned subsidiary of APSA, which the Court began by noting in para 51, could not be a pointer towards that conclusion. If anything, it would point against it. So, on this interpretation, the European Court could have had no reason to draw attention to the status of APMSD. Yet it did. Mr Maskrey criticised APSAs interpretation of para 52 on the specific ground that it involved reading in three words: whether the putting into circulation of the product in question by the supplier, was, in fact, determined by the parent company which manufactured it. Mr Leggatt QC accepted that this was, in effect, how he contended that the sentence should be interpreted. In my view, that is indeed the correct interpretation. The European Courts reference to APMSD being a wholly owned subsidiary of APSA is only consistent with it directing attention to factors which may point to a close connexion between the two companies. Given the context of the discussion (seeing whether proceedings against APMSD count as proceedings against APSA), that is precisely what we would expect. For the reasons already given, we should also expect the focus to be on the time when the Product was supplied by APMSD to the Department of Health, since, if APMSD was, in effect, tied into the manufacturing process of APSA, the Product would only be put into circulation when it was supplied by APMSD. And that is what we find in para 51 where the European Court refers to APMSDs status as a wholly owned subsidiary at the time when it supplied the Product to the Department of Health. Therefore, in para 52 the Court must indeed be referring to the Product being put into circulation by the supplier at the behest of its parent. That interpretation is also consistent, of course, with what the Advocate General says in paras 111 and 113 of her Opinion on the second reference (quoted at para 24 above). This interpretation of para 52 is also consistent with its language, both in the English version and in the original French (si la mise en circulation du produit concern a t dtermine en fait par la socit mre qui la fabriqu). The European Court is plainly contemplating a situation where, to all outward appearances, a supplier has decided to put a product into circulation. The domestic court must look at the circumstances to see whether, despite appearances, in fact, it was the manufacturing parent company which had determined that the product should be put into circulation. If, by contrast, the European Court had meant what Mr Maskrey suggested, it would have had no reason to use this language: all it would have required to say was that the national court was to assess whether the parent company, which manufactured the product, transferred it to its wholly owned subsidiary, the distributor. The further difficulty with that interpretation is, of course, that everyone agrees that APSA sent the consignment containing the Product to APMSD on 18 September and that APMSD received it on 22 September. There would therefore be nothing for the domestic court to assess. The European Court was therefore indicating, in para 52, that the domestic court was to consider, in accordance with domestic rules of proof, whether the manufacturer, APSA, was in fact controlling APMSD and determining when it put the Product into circulation. There is nothing in the judgment of the European Court on either reference to suggest that the fact that APMSD was a wholly owned subsidiary of APSA could somehow, of itself, be a reason for allowing APSA to be substituted after the expiry of the ten year period. Indeed, that would be inconsistent with the two companies being distinct entities. Rather, the fact that APMSD was a wholly owned subsidiary was simply one by no means decisive factor to be taken into account by the domestic court when assessing how closely the subsidiary was involved with its parents business as an Article 3(1) producer. All the circumstances would have to be taken into account. If APSA was indeed in a position to decide when the Product was to be distributed, then APMSD would be integrated into the manufacturing process and so tightly controlled by APSA that proceedings against APMSD could properly be regarded as proceedings against the parent company, APSA. Hence, as the European Court goes on to hold in para 53, the manufacturing parent company could be substituted for the subsidiary APSA for APMSD. Mr Maskrey submitted that, if the European Courts judgment were interpreted in this way, then it would allow substitution of the parent producer only where the supplier could, in any event, itself be sued as a producer falling within the definition in Article 3(1). But that is, of course, precisely what the Advocate General does say in paras 113 and 115 of her Opinion. Moreover, the criticism seems a little ungenerous. It is, after all, the claimant who, for what must presumably appear to him to be good reasons, wishes to substitute APSA for APMSD as the defendant. The Advocate General and the Court are merely responding to that situation by pointing to circumstances where it might indeed be possible for the claimant to do so. It is, of course, the case that, in any such circumstances, the claimant will also be able to sue the supplier as a producer within the terms of Article 3(1). But that is not a criticism of the approach taken by the Advocate General or the Court. If a claimant will gain nothing by suing the manufacturer in substitution for the supplier, he will presumably not try to do so. But such a course might have advantages if, say, the supplier were insolvent. The Advocate General and the European Court were entitled to assume that, in this case, the claimant had what he regarded as good reasons for wishing to make the substitution. For these reasons, I would allow the appeal and set aside paragraph 1 of the order of Teare J dated 20 October 2006 substituting Aventis Pasteur SA for Aventis Pasteur MSD in the present action, HQ02X00848.

The Respondent was vaccinated on 3 November 1992 with a vaccine (the Product) manufactured in France by a French company, now known as Aventis Pasteur SA (APSA). On 18 September 1992 APSA sent a consignment of the vaccine, including the Product, to its then wholly owned subsidiary, Aventis Pasteur MSD Ltd (APMSD), in England. APMSD acted as a United Kingdom distributor for APSAs products. APMSD received the consignment on 22 September 1992 and sold part of it, including the Product, on an unknown date. The Product was eventually used to vaccinate the Respondent. On 1 August 2001 the Respondent began proceedings under section 2 of the Consumer Protection Act 1987 (CPA) against APMSD, alleging that the Product was defective and had caused him brain damage. On 16 October 2002 the Respondent issued separate proceedings against APSA also under section 2 of the CPA. Relying on section 11(3) of the Limitation Act 1980 (the LA) and Article 11 of Council Directive 85/374/EEC of 25 July 1985 (the Directive), APSA defended this action on the basis that it had been raised more than ten years after APSA had put the Product into circulation, which APSA alleged was 22 September 1992 at the latest. Broadly, Article 11 provides that there is a ten year time limit for initiating proceedings against the producer (as defined in the Directive) of a product. Faced with this defence, the Respondent sought an order that APSA be substituted as a defendant in place of APMSD in the proceedings against APMSD, relying on section 35(5)(b) and (6)(a) of the LA. These provisions allow a new party to be substituted for a party whose name was given in any claim made in the original action in mistake. APSA contended that, in so far as English law permitted such substitution after the expiry of the time limit, it was inconsistent with Article 11. The High Court made a preliminary reference to the European Court of Justice (ECJ). So far as the power to substitute one producer for another as defendant was concerned, the House of Lords (to which the case eventually came) could not reach a unanimous view as to the effect of the ECJs judgment. The House of Lords therefore referred the question back to the ECJ. The answer returned by the ECJ is now clear: once ten years have passed since a producer put a product into circulation, that producer cannot be sued unless proceedings have been taken against it within the ten year period. The Respondent now accepts that he cannot use section 35 of the LA as a basis for substituting APSA for APMSD as the defendant in the present proceedings. The Respondent submits, however, that in its judgment the ECJ indicated a different basis on which he can actually make the desired substitution, namely, that in proceedings instituted within the ten year period against the wholly owned subsidiary of the producer, that producer can be substituted for that subsidiary if the domestic court finds that the putting into circulation of the product in question was, in fact, determined by that producer. The dispute between the parties therefore turns on the interpretation of that part of the ECJs judgment. The Supreme Court unanimously allowed the appeal and set aside paragraph 1 of the order of Teare J dated 20 October 2006 substituting APSA for APMSD in the present action. Lord Rodger gave the judgment of the Court. There is nothing to suggest that, when providing the additional guidance which is the subject of the dispute in the present case, the ECJ was intending to depart from the principled approach which it had formulated earlier in its judgment, namely, that Article 11 precluded national legislation being applied in a way which permitted a producer to be sued after the expiry of the ten year limitation period as defendant in proceedings brought within that period against another person (para 17). In venturing to give the additional guidance, the ECJ was following the lead of the Advocate General. The Advocate General had given some thought to how Article 11 should be applied in a case like the present, where APSA transferred the Product to a distributor, APMSD, which was its wholly owned subsidiary. In doing so, the Advocate General had referred back to the ECJs judgment on the first reference where the ECJ had held that a product is put into circulation when it is taken out of the manufacturing process operated by the producer and enters a marketing process in the form in which it is offered to the public in order to be used or consumed (paras 18 20). The ECJ, in its judgment following the first reference, had rejected an approach that was based on the formal legal relationship between the parent manufacturing producer and the subsidiary distributor. The national court had to look at all the links between the two entities and decide on that basis whether they were so close that, for the purposes of Article 11, the concept of the manufacturing producer (which would apply to APSA) really included the distributor (in this case, APMSD). In that event, even if the Product were transferred from one to the other, this would not mean that it had been taken out of the manufacturing process operated by the producer (para 22). The Advocate General made use of that part of the ECJs analysis from the first reference to show when a distribution subsidiary could be so closely involved with the parent producer that they could, in effect, be regarded as one for the purposes of Article 11 (so that suing the subsidiary would be tantamount to suing the parent). In concrete terms, if that were the position in this case, by suing APMSD within the ten year period, the Respondent would also have sued APSA within that period. So the Article 11 time bar would not bite and the Respondent could, if he wished, substitute APSA for APMSD as defendant in the present action (para 23). It is with this background in mind that the ECJ gave its additional guidance in the second reference. There is nothing to suggest that, in giving that guidance, it was intending to depart in any way from the analysis in its first reference (para 27). Certainly, to judge from the Advocate Generals analysis, the only way in which the principle that had just been laid down in relation to the substitution of APSA for APMSD could be maintained and yet APSA could be substituted for APMSD would be if, by suing APMSD, the Respondent had in effect sued APSA (para 28). The ECJ was therefore indicating, in giving its guidance, that the domestic court was to consider, in accordance with domestic rules of proof, whether the manufacturer, APSA, was in fact controlling APMSD and determining when it put the Product into circulation. The fact that APSA was a wholly owned subsidiary was simply one by no means decisive factor to be taken into account by the domestic court when assessing how closely the subsidiary was involved with its parents business as a producer. All the circumstances would have to be taken into account. If APSA was indeed in a position to decide when the Product was distributed, then APMSD would be integrated into the manufacturing process and would be so tightly controlled by APSA that proceedings against APMSD could properly be regarded as proceedings against the parent company, APSA. Hence, the manufacturing company could be substituted for the subsidiary (para 34).

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The issue in this case is the proper approach of the immigration appellate authorities where the Secretary of State has decided that a national of the European Economic Area who is lawfully living in the United Kingdom should be removed on the ground of abuse of the right to reside here. The abuse in question happened to be an alleged attempt to enter into a marriage of convenience but the issue would arise in respect of any abuse which would justify removal under article 35 of Directive 2004/38/EC on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States (the Directive). The facts Ms Sadovska is a citizen of Lithuania. She came to this country lawfully in February 2007 and has since been living and working here lawfully, exercising her rights under the Directive. She lives in Edinburgh, where her sisters also live, and works as a cleaner. Mr Malik is a citizen of Pakistan who came to this country lawfully with a Tier 4 student visa in May 2011. His visa expired on 15 April 2013 and he has been here unlawfully ever since. He too lives and worked in Edinburgh until 17 April 2014. They say that they met at a disco, El Barrio in Edinburgh, in October 2012. They spent that night together and saw one another from time to time afterwards, meeting members of one anothers families, but the relationship did not become a steady one until Valentines Day 2013. Thereafter, they say, they saw one another as boyfriend and girlfriend. It is common ground (and there is photographic evidence) that in December 2013, Mr Malik attended the wedding of Ms Sadovskas sister and that they were on the streets of Edinburgh together during the celebrations at Hogmanay 2013. It is also common ground that Mr Malik booked a double room for two adults at a London hotel for four nights in January 2014 and that they were both in London at that time. They say that they were on holiday together and that was when they decided to get married. On 25 March 2014, they published notice of their intention to marry on 17 April 2014 at Leith Registry Office. On 28 March 2014, they signed a one page statement about their relationship which included the following puzzling sentence: We have discussed the idea of living together in depth and also have touched upon the subject of marriage, but as of yet, none of these discussions have manifested into action. That statement was enclosed in a letter dated 11 April 2014, sent by solicitors acting for Mr Malik (and, it would appear, also for Ms Sadovska) to the Home Office in Glasgow. This explained that their client was an over stayer, but that he intended to marry an EEA national on 17 April 2014 and would be applying for recognition that he was exercising Treaty rights as a family member of an EEA national, so it was hoped that no enforcement action would be taken against him. The letter recognised that officials might wish to interview their clients but hoped that this could be done before their wedding on 17 April. It also stated that: We would like you to take this letter as a human rights allegation that both the applicant and the EEA national have established a family life in the United Kingdom and any decision to attempt to remove the applicant from the United Kingdom would be challenged on article 8 grounds and also on the grounds that the applicant [sci: attempt?] breaches our clients right to marry under article 12 of the ECHR. Enclosed were copies of Mr Maliks passport, of Ms Sadovskas identity card, birth certificate and most recent payslip, a receipt from the Property Management Company in respect of a flat in Edinburgh for which they had signed a lease on 6 April 2014, three statements from two people who knew them, and their statement of 28 March. Mr Malik and Ms Sadovska had indeed signed a lease for a flat in Edinburgh on 6 April 2014 and each gave this as their home address when interviewed on 17 April. (We are told that they still live together but at a different address.) On 16 April 2016 they bought wedding rings. The solicitors letter was faxed to the Home Office on Friday 11 April. The wedding was due to take place on the afternoon of the following Thursday. Before that could happen, however, immigration officers arrived at the Registrars Office and asked to interview them. They agreed. Each was cautioned and agreed to be interviewed in English. They were interviewed separately, Mr Malik from 14.55 to 16.20 and Ms Sadovska from 14.54 to 16.50, according to the immigration officers records. After the interviews they were detained and thus unable to marry. Ms Sadovska was released soon afterwards, but Mr Malik was detained until 11 June. On the same day as the interviews, each was issued with a two part decision notice. Mr Malik was issued with a notice that he was a person liable to removal as an over stayer, who had not applied for further leave to remain after his visa had expired and was thus liable to be detained pending a decision whether or not to give directions for his removal from the United Kingdom. The notice explained that he had breached section 10(1)(a) of the Immigration and Asylum Act 1999, which provides that a person who is not a British citizen may be removed from the United Kingdom, in accordance with directions given by an immigration officer, if (a) having only a limited leave to enter or remain, he . remains beyond the time limited by the leave, and had therefore committed an offence under section 24(1)(b)(i) of the Immigration Act 1971. Ms Sadovska was issued with a notice that she was a person liable to removal because her removal was justified on grounds of abuse of rights, specifically that she had attempted to enter into a marriage of convenience with Mr Malik. The notice referred to regulation 19(3)(c), without explaining that this was contained in the Immigration (European Economic Area) Regulations 2006. At the time, this provided that an EEA national who has entered the United Kingdom . may be removed if (c) the Secretary of State has decided that the persons removal is justified on grounds of abuse of rights in accordance with regulation 21B(2). Regulation 21B(1) provided that The abuse of a right to reside includes (c) entering, attempting to enter or assisting another person to enter or attempt to enter, a marriage or civil partnership of convenience. Regulation 21B(2) provided that The Secretary of State may take an EEA decision on the grounds of abuse of rights where there are reasonable grounds to suspect the abuse of a right to reside and it is proportionate to do so. Regulation 24(2) provided that where a decision to remove was taken under regulation 19(3)(c), the person was to be treated as someone to whom section 10(1)(a) of the 1999 Act applied. In each case, the notice was accompanied with notice of a decision to remove. Both appealed to the First tier Tribunal which heard their appeals together on 4 August 2014 and promulgated a determination refusing them both on 19 August 2014. Their appeals to the Upper Tribunal were heard on 5 February 2015 and a determination refusing them was promulgated on 9 February 2015. Their appeals to the First Division of the Inner House of the Court of Session were refused on 17 June 2016: [2016] CSIH 51. They now appeal to this court. They make two complaints about the decisions of the tribunals and court below. The first, and most important, relates to the burden of proof in a case such as this. Under the heading Applicable law, the First tier Tribunal judge said this, at para 7: In immigration appeals, the burden of proof is on the appellant and the standard of proof required is a balance of probabilities. In human rights appeals, it is for the appellant to show that there has been an interference with his or her human rights. If that is established, and the relevant article permits, it is then for the respondent to establish that the interference was justified. The appropriate standard of proof is whether there are substantial grounds for believing the evidence. It is apparent from his determination that his whole approach was to require Ms Sadovska and Mr Malik to prove that their proposed marriage was not a marriage of convenience, rather than to require the Home Office to prove that it was. Before the Upper Tribunal the appellants complaint was that the First tier Tribunal judge had taken the interviews as his starting point and given too much weight to the inconsistencies between them and had not considered them in the context of the totality of the evidence, as required by the decision of the Upper Tribunal in Papajorgji v Entry Clearance Officer, Nicosia [2012] UKUT 38, [2012] Imm AR 3 (at para 39). Papajorgji was an extraordinary case in which an Albanian woman who had been married to and living with a Greek man for 12 years and had two children with him was refused a visa to accompany him on a visit to this country on the ground that theirs was a marriage of convenience, a belief which, as the Upper Tribunal said, was on the information supplied with the application simply ludicrous (para 32). There was no burden on the claimant in an application for a family permit to establish that she was not party to a marriage of convenience unless the circumstances known to the decision maker gave reasonable ground for suspecting that that was the case. Where there was such a suspicion the matter required further investigation and the claimant should be invited to respond to by producing evidential material to dispel it (para 27). But suspicion was not enough. The claimant was only disqualified if it was established that the marriage was one of convenience (para 37). The question for the judge was in the light of the totality of the information before me, including the assessment of the claimants answers and any information provided, am I satisfied that it is more probable than not this is a marriage of convenience? (para 39) Before the First Division, the appellants did complain that the tribunal had adopted the wrong approach to the burden of proof and that the respondent had failed to prove to the requisite high degree that the appellants were guilty of fraud. The court dealt with the matter in this way, at para 20: However, as has often been said, once the evidence has been heard, questions of onus usually cease to be important (Sanderson v McManus 1997 SC (HL) 55, Lord Hope at 62). The view of the UT in Papajorgji (at para 39) that the question, in the Tribunal context, was whether it is more probable than not that the marriage is one of convenience in [the] light of the totality of the information, accords with that dictum. The court went on to say that the First tier Tribunal had considered all the information and reached a decision based upon it. That decision did not depend upon onus but upon weighing the various factors in the balance. In that context, there was only one standard of proof, that being the balance of probabilities (Scottish Ministers v Stirton 2014 SC 218, the Lord Justice Clerk (Lord Carloway) at paras 117 119). It is perhaps worth noting that Lord Hopes observation in Sanderson v McManus, that questions of onus usually cease to be important once the evidence is before the court was in the context of a dispute between unmarried parents about a fathers contact with his child, when, as Lord Hope observed the matter then becomes one of overall impression, balancing one consideration against another and having regard always to the consideration which has been stated to be paramount (that is, the welfare of the child). Even then, the court had to be able to come to the conclusion that making an order would be in the childs best interests. This demonstrates that, when considering the burden of proof, it is necessary to understand what the issues are and what has to be established. The appellants also complain that their interviews were unfair, oppressive and repugnant to public law standards. The circumstances of being approached on their wedding day by uniformed immigration officers carrying batons and handcuffs meant that they were frightened. They agreed to be interviewed in English but neither is fluent in English. They had no time to contact their solicitor for advice, to obtain an interpreter, to produce evidence and contact witnesses. They complain that both the First tier and the Upper Tribunal had thought the interviews were of central importance, yet they gave no weight to the circumstances in which they had taken place. The law It is of central importance in this case to consider the substantive law governing the respondents decisions and what had therefore to be established in each case. It differs significantly as between the two appellants. Ms Sadovska is an EEA national. Her rights are therefore governed by the Directive, which the 2006 Regulations were designed to implement in UK law. To the extent, if any, that the 2006 Regulations do not accurately transpose the requirements of the Directive, we have to give effect to the Directive rather than the Regulations and so it is appropriate to focus on the provisions of the Directive. She has been living lawfully in the United Kingdom for a continuous period of more than five years. This means that, under article 16 of the Directive, she has the right of permanent residence here. None of the conditions attached to the right of residence of people who have been here for more than three months but less than five years, provided for in article 8 of the Directive, applies. Article 28.2 lays down the general rule that a host member state may not take an expulsion decision against a Union citizen who has the right of permanent residence except on serious grounds of public policy or public security. However, Recital 28 to the Directive states that: To guard against abuse of rights or fraud, notably marriages of convenience or any other form of relationships contracted for the sole purpose of enjoying the right of free movement and residence, member states should have the possibility to adopt the necessary measures. This is therefore provided for in article 35, which is the crucial article in this case: Member states may adopt the necessary measures to refuse, terminate or withdraw any right conferred by this Directive in the case of abuse of rights or fraud, such as marriages of convenience. Any such measure shall be proportionate and subject to the procedural safeguards provided for in articles 30 and 31. Article 30 requires that the person concerned be notified in writing of the decision and informed precisely and in full of the reason for it and where and within what time that person may lodge an appeal. Article 31 requires that the person have access to judicial and, where appropriate, administrative redress procedures to appeal against or seek review of any decision taken against them. These shall allow for an examination of the legality of the decision, as well as of the facts and circumstances on which [it] is based. They shall ensure that the decision is not disproportionate A Communication from the Commission to the European Parliament and the Council on guidance for the better transposition and application of Directive 2004/38/EC, dated 2 July 2009, has this to say about marriages of convenience, at para 4.2: Recital 28 defines marriages of convenience for the purposes of the Directive as marriages contracted for the sole purpose of enjoying the right of free movement and residence under the Directive that someone would not have otherwise. A marriage cannot be considered as a marriage of convenience simply because it brings an immigration advantage, or indeed any other advantage. The quality of the relationship is immaterial to the application of Article 35. The definition in the first sentence is repeated in the Commissions more recent Handbook on addressing the issues of alleged marriages of convenience between EU citizens and non EU nationals in the context of EU law on free movement of EU citizens, dated 26 September 2014. However, this goes on to explain that: the notion of sole purpose should not be interpreted literally (as being the unique or exclusive purpose) but rather as meaning that the objective to obtain the right of entry and residence must be the predominant purpose of the abusive conduct. But it repeats that: On the other hand, a marriage cannot be considered as a marriage of convenience simply because it brings an immigration advantage, or indeed any other advantage (for example the right to a particular surname, location related allowances, tax advantages or entitlement to social housing for married couples). Mr Malik is in a different position from Ms Sadovska. As an over stayer he is, as noted above, liable to be removed under section 10(1)(a) of the 1999 Act. However, had he succeeded in marrying Ms Sadovska, he would have become a family member within the meaning of article 2.2 of the Directive. Under article 7.2, this would bring with it the right of residence for more than three months, provided that Ms Sadovska satisfied one of the conditions in article 7.1(a), (b) or (c). As a worker she would satisfy condition (a). Once he had been living here lawfully for five years, he too would acquire a right of permanent residence under article 16.2. As with Ms Sadovska, of course, he would be liable to removal under article 35 if their marriage was one of convenience. As they have not succeeded in marrying, Mr Malik is not a family member of an EU citizen. However, article 3.2 requires Member States to facilitate the entry and residence of certain other persons, who include (b) the partner with whom the Union citizen has a durable relationship, duly attested. Article 3.2 also requires that The host member state shall undertake an extensive examination of the personal circumstances and shall justify any denial of entry or residence to these people. Finally, of course, both Ms Sadovska and Mr Malik have rights under the European Convention on Human Rights. Article 8.1 guarantees the right to respect for private and family life, although under article 8.2 interference is justified if it is in accordance with the law and necessary in a democratic society to achieve a legitimate aim. Article 12 guarantees the right of men and women of marriageable age to marry and to found a family, according to the national laws governing the exercise of [the] right. Analysis It is clear from the provisions of the Directive quoted above that Ms Sadovska has a right of permanent residence in the United Kingdom. As an EU citizen, under article 27.1, her freedom of movement can only be restricted on grounds of public policy, public security or public health. As a permanent resident, under article 28 she could only be removed if those grounds are serious. It is not suggested that she can be removed under article 28 on any of those grounds. She can therefore only be removed, under article 35, if it is established that she has entered, or attempted to enter, into a marriage of convenience. Furthermore, although the Regulations permit the respondent to take steps on the basis of reasonable grounds to suspect that that is the case, Ms Sadovska is entitled to an appeal where the facts and circumstances must be fully investigated. That must mean, as held in Papajorgji, that the tribunal has to form its own view of the facts from the evidence presented. The respondent is seeking to take away established rights. One of the most basic rules of litigation is that he who asserts must prove. It was not for Ms Sadovska to establish that the relationship was a genuine and lasting one. It was for the respondent to establish that it was indeed a marriage of convenience. For this purpose, marriage of convenience is a term of article Although it is defined in the Directive and the 2009 Communication as a marriage the sole purpose of which is to gain rights of entry to and residence in the European Union, the 2014 Handbook suggests a more flexible approach, in which this must be the predominant purpose. It is not enough that the marriage may bring incidental immigration and other benefits if this is not its predominant purpose. Furthermore, except in cases of deceit by the non EU national, this must be the purpose of them both. Clearly, a non EU national may be guilty of abuse when the EU national is not, because she believes that it is a genuine relationship. In the case of a person exercising EU law rights, the tribunal must also be satisfied that the removal would be a proportionate response to the abuse of rights established. So it would be one thing to find that the proposed marriage had been shown to be one of convenience, and therefore that it was right to prevent it, but quite another thing to find that expelling Ms Sadovska from the country where she had lived and worked for so long and had other family members living was a proportionate response to that. The First tier Tribunal did not analyse her rights in this way. It was quite simply incorrect to deploy the statement that in immigration appeals the burden of proof is on the appellant, correct though it is in the generality of non EU cases, in her case. She had established rights and it was for the respondent to prove that the quite narrow grounds existed for taking them away. Nor did the determination address the issue of proportionality. It is impossible for this court to conclude that, had the matter been approached in the right way, the decision would inevitably have been the same. The position of Mr Malik is different, for he has no established rights, either in EU law or in non EU immigration law. In order to benefit from the Directive, he would have to show that he has a durable relationship with Ms Sadovska. However, article 3.2 requires the respondent to justify any refusal of entry or residence in such cases. So if he can produce evidence of a durable relationship (a term which is not defined in the Directive), it would be for the respondent to show that it was not or that there were other good reasons to deny him entry. It is not impossible that a tribunal, properly directing itself, would reach different conclusions in the case of these two appellants. But it is impossible for this court to conclude that, had the matter been approached in the right way, the decision relating to Mr Malik would inevitably have been the same. It follows that the appeal must be allowed and the case remitted for a full re hearing by the First tier Tribunal. In seeking to establish its case, the respondent will no doubt concentrate on the interviews, the discrepancies between the appellants accounts, and the gaps in Ms Sadovskas knowledge of Mr Maliks family, together with the sentence in their statement of 28 March that their thoughts of living together and marriage had not yet manifested into action (which on 28 March was strictly true in that they were not yet living together or married but they had given notice of intention to marry). But in considering those discrepancies, the circumstances in which the interviews took place and the statement was made must be borne fully in mind. Furthermore, there were many matters on which their accounts were consistent. It turns out, for example, that Ms Sadovskas mother does indeed live in Lithuania, as Mr Malik said in explaining why she was not there. There is also a considerable body of evidence which supports their claim to have been in a genuine relationship, dating back some time before they gave notice of intention to marry. Should the tribunal conclude that Mr Malik was delighted to find an EU national with whom he could form a relationship and who was willing to marry him, that does not necessarily mean that their marriage was a marriage of convenience, still less that Ms Sadovska was abusing her rights in entering into it. Their legal and their factual cases must be considered separately. Having reached the firm conclusion that the case must be remitted to the First tier Tribunal to be heard afresh, because a wrong approach was taken to the requirements of EU law in this case, it is unnecessary to consider whether the appellants Convention rights add anything further to their claims. But for my part I would not accept their argument that, because their marriage was frustrated by the respondents actions, their case should be approached as if they were married, which would, of course, enhance Mr Maliks claims. It must be permissible for the state to take steps to prevent sham marriages, although it is also incumbent on the state to show that the marriage would indeed be a sham.

An EU citizen with a permanent right of residence in a host member state may have that right removed in the case of abuse of rights or fraud, such as marriages of convenience. The issue in this appeal is which party bears the burden of proof of establishing that a proposed marriage is one of convenience. Ms Sadovska is a citizen of Lithuania. She moved to the United Kingdom in 2007 and has lived and worked here lawfully since, acquiring a right of permanent residence as an EU citizen pursuant to Directive 2004/38/EC (the Directive). Mr Malik is a citizen of Pakistan who entered the UK with a student visa in May 2011 and has remained here unlawfully after his visas expiry in April 2013, in breach of section 10(1)(a) Immigration and Asylum Act 1999. Ms Sadovska and Mr Malik (the appellants) maintain that they have been in a relationship with each other since February 2013, and decided to marry in January 2014. On 11 April 2014, the appellants solicitors notified the Home Office in Glasgow that they intended to marry on 17 April 2014 at Leith Registry Office and invited officials to interview them before the wedding. Immigration officers arrived at the Registrars Office, interviewed the appellants separately, and then detained them before they were able to marry. Both were then served with notice that they were persons liable to removal from the UK: Mr Malik by having stayed after the expiry of his visa and Ms Sadovska by giving the Secretary of State reasonable grounds to suspect the abuse of her EU right of residence by attempting to enter into a marriage of convenience, contrary to regulation 19(3)(c) Immigration (European Economic Area) Regulations 2006. The appellants appealed to the First tier Tribunal. The judge held that the burden of proof was on the appellants to establish that their proposed marriage was not a marriage of convenience, and that they had failed to do this, having regard to the inconsistencies in their accounts at interview. The appellants appealed unsuccessfully to the Upper Tribunal and to the First Division of the Inner House, arguing that the tribunal had adopted the wrong approach to the burden of proof, and that the Secretary of State had failed to prove that the appellants were guilty of fraud, when the totality of the evidence relating to their relationship and the circumstances in which the interviews had taken place was taken into account. The Supreme Court unanimously allows the appeal and remits the case for a full re hearing by the First tier Tribunal. Lady Hale gives the only substantive judgment. It was important to identify the different rights the appellants individually enjoyed, and thus what the Secretary of State needed to establish in order to remove them: Ms Sadovska had a right of permanent residence in the UK and could not be expelled unless she had abused her rights within the meaning of article 35 of the Directive. A Communication in 2014 from the European Commission giving guidance on the Directive explained that a marriage of convenience was a marriage contracted with the predominant purpose of enjoying the right of free movement. It was not enough that the marriage might bring incidental immigration and other benefits, and the predominant purpose must be the purpose of both parties [21 24, 29]. Mr Malik was liable to be removed as an over stayer. Had he succeeded in marrying Ms Sadovska he would have acquired a right of residence in the UK under the Directive as a family member of an EU national working here. The Directive also required member states to facilitate the entry and residence of the partner of an EU citizen if it was a durable relationship, duly attested [25 26]. Both appellants enjoyed rights under articles 8 and 12 of the European Convention on Human Rights to a private and family life, and to marry and found a family [27]. The 2006 Regulations permitted the Secretary of State to take steps to remove Ms Sadovska on the basis of reasonable grounds to suspect that she had entered or attempted to enter a marriage of convenience, but she was entitled to an appeal where the facts and circumstances were fully investigated. The tribunal had to form its own view of the facts from the evidence presented. It was not for her to establish that her relationship with Mr Malik was a genuine and lasting one, but for the Secretary of State to establish that it fell within the definition of a marriage of convenience [28]. The tribunal had also to be satisfied that the removal of Ms Sadovska from the country where she had lived and worked for so long with other family members would be a proportionate response to the abuse of rights, rather than merely the prevention of the marriage [30]. As the tribunal had not analysed Ms Sadovskas rights this way, it was not possible for the Supreme Court to conclude that the Secretary of State had proved that the narrow grounds for taking away her established rights existed [31]. Mr Malik had no established rights but if he could produce evidence of a durable relationship with Ms Sadovska, it would be for the Secretary of State to show that it was not, or that there were other good reasons to deny him entry. Again, the Supreme Court could not conclude that, had his case been approached in the right way, the outcome would have inevitably been the same [32 33]. Accordingly, the burden of proof of establishing that the proposed marriage is one of convenience falls on the Secretary of State. The appeal is allowed and the case remitted for a full rehearing by the First tier Tribunal, at which the inconsistencies in the appellants interviews will be considered along with their evidence supportive of a genuine relationship dating back several months, and the circumstances in which the interviews took place will also be taken into account [34]. The appellants ECHR rights did not add anything further to their claims in the light of this conclusion. Such rights would not in any event prevent a state from taking steps to prevent sham marriages, if it could show that the marriage would indeed be a sham [35].

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In circumstances in which at the time of a divorce a spouse, say a wife, is awarded capital which enables her to purchase a home but later she exhausts the capital by entry into a series of unwise transactions and so develops a need to pay rent, is the court entitled to decline to increase the order for the husband to make periodical payments to her so as to fund payment of all (or perhaps even any) of her rent even if he could afford to do so? Mr Mills (whom it will be convenient to describe as the husband notwithstanding his divorce from Mrs Mills, the wife, in 2002) appeals against an order for upwards variation of an order for periodical payments against him in favour of the wife. The order for variation was made by the Court of Appeal (Longmore LJ and Sir Ernest Ryder, Senior President of Tribunals) on 1 February 2017: [2017] EWCA Civ 129. By that order, the Court of Appeal allowed the wifes appeal against the dismissal of her application to vary the order for periodical payments by Judge Everall QC (the judge) in the Central Family Court in London on 9 June 2015. The husband and wife are each aged 52. They were married in 1987. The wife is a qualified beauty therapist. In the early years of the marriage she worked, self employed, in that capacity. The husband built up a surveying business within two companies which he and the wife owned in equal shares. They had one child, a son, now adult. In 1996 the wife unfortunately suffered a late miscarriage, which precipitated a long period of painful gynaecological difficulties for her. In 2000 the husband left the home in Guildford. On 7 June 2002, in the ensuing divorce proceedings, financial issues were resolved within a consent order. In addition to provision for their son, who was to continue to make his home with the wife and have contact with the husband, the order provided that: i) the home, vested in the joint names of the parties, should be sold; ii) its net proceeds should be divided in accordance with a formula which in the event yielded 230,000 for the wife in settlement of all her capital claims against the husband and 23,000 for him; the wife should transfer to the husband her interest in policies worth iii) 23,000 and her shares in the surveying companies; and iv) the husband should make periodical payments to her at the annual rate of 13,200 (not index linked) on the open ended basis, namely during their joint lives until her remarriage or further order in the interim. The wife therefore received the vast preponderance of the parties liquid capital. The value of the two companies was not identified. At the time of making the consent order the wife had represented that ill health was disabling her from working and that she would need 350,000 with which to purchase a suitable home for herself and their son. The husband had conceded that she then had no capacity to raise a mortgage but had suggested, by contrast, that she could purchase a suitable home for 230,000 or less, in other words free of mortgage. In the event, later in 2002, she proceeded to purchase a house in Weybridge for 345,000 by deploying in effect her entire share of the proceeds of the home and by raising the balance of 125,000 on mortgage. When he learnt of the wifes purchase, the husband, by solicitors, expressed surprise at its high cost and concern about her ability to service a mortgage, let alone one of such size. By solicitors, she replied only that she had not been able to secure reasonably priced accommodation in an area in which it would in her opinion be best for their son to grow up. wife had begun to work again as a beauty therapist, but part time. In 2006 the wife sold the house in Weybridge at the price for which she had bought it, namely 345,000. But the sum owing on mortgage had risen by 93,000 to 218,000. Having received written and oral evidence from the wife, the judge found that she had been unable satisfactorily to explain why the sum owing had increased or in what way the increase had been spent. Upon the sale of the house in Weybridge the wife bought a flat in Wimbledon for 323,000, with a deposit of 48,000 and a mortgage of 275,000. The judge therefore calculated that, net of collateral costs of the transactions, about 62,000 of the proceeds of sale had not been used in the purchase of the flat; but he noted that the wife had refurbished it to some extent. It is clear that, by the time of her purchase of the house in Weybridge, the In 2007 the wife sold the flat in Wimbledon for 435,000. The sum then owing on mortgage had risen only marginally, namely to 277,000. Instead she bought a flat in Battersea for 520,000, with a deposit of 78,000 and a mortgage of 442,000. The judge therefore calculated that, net of the collateral costs, about 44,000 of the proceeds of sale had not been used in the purchase of the second flat. It is unclear from his judgment how the wife was able to secure, and then to service, a borrowing as high as 442,000. In 2009 the wife sold the flat in Battersea for 580,000 and began to rent accommodation. The judge calculated that, after repaying the mortgage of 442,000 and meeting the collateral costs, the wife received about 120,000 from the proceeds of sale. Between 2009 and 2015 the wife rented six successive properties in London and Surrey. By April 2015, when the judge heard the case, the wife had no capital. On the contrary, she had overdrafts of 4,000, credit card liabilities of 18,000 and a tax liability of about 20,000. Before the judge were cross applications. The husband had applied for discharge of the order for periodical payments on his payment to the wife of a modest capital sum, say of 26,000; or for a fixed period to be set on her continued receipt of periodical payments and/or for a downwards variation of their amount. The wife had cross applied for an upwards variation of their amount. Both applications were made under section 31(1) of the Matrimonial Causes Act 1973 (the Act). Section 31(7) provides: In exercising the powers conferred by this section the court shall have regard to all the circumstances of the case, [which] shall include any change in any of the matters to which the court was required to have regard when making the order to which the application relates, and (a) in the case of a periodical payments . order made on or after the grant of a decree of divorce . , the court shall consider whether in all the circumstances and after having regard to any such change it would be appropriate to vary the order so that payments under the order are required to be made only for such further period as will in the opinion of the court be sufficient to enable the party in whose favour the order was made to adjust without undue hardship to the termination of those payments; The matters to which the court was required to have regard when making the order in 2002, even though it was made by consent, were those set out in section 25(2) of the Act. In his judgment, which was reserved, the judge described the wifes oral evidence as not fully satisfactory. He explained that she had been unable to give him a clear picture of her financial circumstances in the years since 2002; that, apart from her failure to explain the dramatic increase in the size of the mortgage on the house in Weybridge, she had been unable to identify the size of her income from her part time work in the earlier years, first as a beauty therapist and then for an estate agent. He accepted that between 2004 and 2010 she had undergone no less than seven surgical procedures referable to her gynaecological difficulties and that they had affected her earning capacity at that time. He found, however, that she had exaggerated the continuing impact, five years later, of those difficulties upon her earning capacity. In 2010 she had reverted to work as a beauty therapist. Her accounts for the last available year, namely to April 2014, disclosed an annual income net of tax of about 18,500. She had then been working about three days each week. The judge rejected her contention that ill health precluded her from working for a fourth day but accepted that she might not be able to attract the extra clients to occupy it. He therefore ascribed to her annual net earnings of only 18,500. The husband contends that it was a somewhat conservative figure; but it is appropriate for an appellate court to adopt it without qualification. The judge found that the husband, by contrast, gave reliable and truthful evidence in all respects. He had remarried and was living with his second wife, their nine year old son and an adult step daughter in a house in Guildford in which, subject to a substantial mortgage, he had a half interest. As in 2002 he had little liquid capital. The judge studied his earned income from the surveying companies. They had suffered a reverse in 2012 but had slowly recovered since then and, as the husband frankly conceded at the hearing, they were likely to be thriving by 2025. The judge ascribed to the husband an existing net annual income of 55,000 inclusive of a small salary which one of the companies chose to pay to his current wife. It may again have been a somewhat conservative figure; but it is again appropriate for an appellate court to adopt it without qualification. At the hearing the wifes then counsel put before the judge a breakdown of what he suggested to be the amount of her necessary annual expenditure. The judge accepted it as very modest. Exclusive of figures referable to the adult son, the annual total was 35,792, of which 10,200 was for rent. Following deduction of her earnings of 18,500, the wifes annual need was therefore for 17,292. But the judges decision was not to vary, whether upwards or downwards, the existing order for periodical payments in the annual sum of 13,200. In other words he countenanced a shortfall of 4,092 between the wifes annual need and the husbands obligation to meet it. The answer lies in the judges analysis of the wifes loss of the capital sum which had been awarded to her in 2002. The judge found that: the award in 2002 would then have enabled the wife to buy a home it had however been reasonable for her to be ambitious and to secure i) free of mortgage; ii) a mortgage for the purchase of the house in Weybridge; iii) thereafter she had not managed her finances wisely; iv) like others at that time, she had committed herself to borrowings which were too high; v) or wanton; vi) but her needs had been augmented by reason of the choices which she had made. In the light of those findings the judge decided to reject the husbands submission that the wifes need to pay rent of 10,200 should be entirely eliminated from the total annual need which it would be appropriate for him to meet. Nevertheless it was it would be wrong to describe her approach to finances as profligate fair that the husbands contribution to the wifes needs should not include a full contribution to her housing costs. If, however arbitrarily, one omits to ascribe any part of the wifes earnings to the payment of rent of 10,200 and treats the rent as entirely subsumed within her residual annual need of 17,292, it is easy to see that the effect of the judges decision to countenance a shortfall from that figure of 4,092 was to oblige the husband to pay 6,108 towards the rent, or 60% of it. Although the judge had described the wifes schedule of annual needs totalling 35,792 as very modest and indeed as basic, he said that the husbands contribution should do no more than to enable her to meet her bare minimum needs, which, so he therefore implied, were properly to be reflected in an even lower figure. The wife, he said, will have to adjust her expenditure to live within her means. The judge found on clear evidence that the husband could afford to continue to make periodical payments in the annual sum of 13,200. Indeed, although there was no cause for him to make a finding to this effect, it also seems reasonably clear that the husband could have afforded to pay the extra annual sum of 4,092 if it had been otherwise appropriate to order him to do so; it was certainly no part of the judges reasoning that the husband could not have afforded to pay it. In accordance with his duty the judge then turned to consider the husbands application for him to set a fixed period upon the wifes continued receipt of the periodical payments. But, applying section 31(7)(a) set out in para 14 above, the judge concluded, unsurprisingly, that he could not identify any fixed period as being sufficient to enable the wife to adjust without undue hardship to their termination. It followed that the order should continue to require them to be paid on the open ended basis, namely during their joint lives until her remarriage or further order in the interim. Although the open ended basis does not specify a fixed term for the life of the order, the circumstances which it identifies as bringing it to an end, in particular the potential for a further order ending it at any time, show how misleading (indeed, as the husband himself says, how unattractive) it is for some non lawyers to describe such an order as a meal ticket for life. Inevitably the judge also concluded that any appropriate capitalisation of periodical payments in that continuing sum and on that continuing basis appeared to be beyond the husbands means. So the judge dismissed both the husbands application and the wifes cross application. Both the husband and the wife sought permission from the Court of Appeal to appeal against the respective dismissals of their applications. The wife secured permission to do so but, in circumstances which rendered him aggrieved but are no longer relevant, the husbands application for permission was not granted likewise but was listed to be heard by the court at the time when it was to hear the wifes substantive appeal. At the conclusion of the hearing on 1 February 2017 Sir Ernest Ryder gave an impromptu judgment, with which Longmore LJ agreed. In his judgment Sir Ernest said that i) the judge did not give any reason why any part of the trimmed budget, that is the wifes basic needs budget, should be cut in explanation of why that shortfall should not be met; ii) budget that he, the judge, had accepted in evidence; and iii) his decision that she would have to adjust her expenditure to reduce those needs was a conclusion [which] required reasoning that is not in the judgment. he did not explain why she should live below the basic needs So the Court of Appeal allowed the wifes appeal by varying the order for periodical payments upwards from the annual sum of 13,200 to that of 17,292, backdated to the date of the judges judgment. It refused the husbands application for permission to appeal to it on the ground that his proposed appeal had no prospect of success. The husband filed a notice of appeal to this court. He challenged the increase in the order for periodical payments directed by the Court of Appeal. But he also purported to challenge its refusal to discharge the order for periodical payments; and, alternatively, its refusal to set a fixed period on the wifes continued receipt of them and/or to vary the amount of them downwards. In these respects he was, however, purporting to challenge the Court of Appeals refusal to permit him to appeal to itself on these grounds and, by section 54(4) of the Access to Justice Act 1999, no appeal can be brought against a refusal of permission. So the order of this court was to limit its permission for him to appeal to the single ground whether, in light of the fact that provision had already been made for the wifes housing needs in the capital settlement, the Court of Appeal had been entitled to interfere with the judges determination not to make full allowance for her need to pay rent in the continuing order for periodical payments. Unfortunately the husbands advisers considered that the terms of the limited grant of permission could in some way prove broad enough to enable them to make submissions at the hearing along the wider lines of his impermissible challenge to the Court of Appeals refusal to grant him permission to appeal to it. So at an early stage of the hearing the court had to re emphasise the limited ambit of its inquiry in this particular case. With the greatest of respect to the Court of Appeal, and with (I believe) a full appreciation of the heavy work load under which it currently labours, it erred in saying that the judge had given no reason for declining to increase the order for periodical payments so as to enable the wife to meet all her basic needs. The judge gave a clear reason which is summarised in paras 20 and 21 above. So the question which the Court of Appeal should have addressed, and which this court should now address, is the question set out in para 1 above. the Court of Appeal. First, Pearce v Pearce [2003] EWCA Civ 1054, [2004] 1 WLR 68. At the time of the original order in 1997 the wife had owned a flat in Chelsea free of mortgage. Later she sold the flat; depleted the proceeds by an unfortunate speculation in Ireland; and, upon returning to live in London, could only afford to buy a flat in Fulham subject to mortgage. The original order had also provided for the husband to make periodical payments to the wife; and the subsequent order under appeal in 2003 was to capitalise her entitlement to periodical payments, ie to discharge the order for them upon payment to her by the husband of a lump sum in lieu of them pursuant to section 31(7A) and (7B) of the Act. The major significance of the decision of the Court of Appeal lies in its approach to the exercise of capitalising an order for periodical payments. For present purposes, however, its significance lies in its removal of the wifes mortgage repayments from its calculation of the amount of the periodical payments to which, in the absence of capitalisation, she would then have been entitled and therefore of the amount of the lump sum to be paid by the husband in lieu of them. Thorpe LJ said at para 36 that the judge In addressing the question, the court must consider three earlier decisions of should not have allowed the wife to discharge her mortgage at the husbands expense. Such an indemnity violates the principle that capital claims compromised in 1997 could not be revisited in 2003. There is simply no power or discretion to embark on further adjustment of capital to reflect the outcome of unwise or unfortunate investment on one side or prudent or lucky investment on the other. Second, North v North [2007] EWCA Civ 760, [2007] All ER (D) 386 (Jul). In 1981 an order by consent had provided the wife with ownership of a mortgage free house in Sheffield and of ground rents which generated a comfortable income for her. The order had also included provision for the husband to make periodical payments to her in a nominal sum. In 2000 the wife sold her assets in England and moved to Sydney with relatively disastrous financial consequences, which led her to apply for an upwards variation of the order for periodical payments. The Court of Appeal set aside an order capitalising her entitlement to them in the sum of 202,000 and, although not visible in the transcript or in the report, apparently substituted a substantially lower figure. Thorpe LJ said: 32. In any application under section 31 the Applicants needs are likely to be the dominant or magnetic factor. But it does not follow that the respondent is inevitably responsible financially for any established needs. He is not an insurer against all hazards nor, when fairness is the measure, is he necessarily liable for needs created by the applicants financial mismanagement, extravagance or irresponsibility 33. Thus in the present case the wifes failure to utilise her earning potential, her subsequent abandonment of the secure financial future provided for her by the husband, her choice of a more hazardous future in Australia, together with her lifestyle choices in Australia, were all productive of needs which she had generated and for which the husband should not as a matter of fairness be held responsible in law. And third, Yates v Yates [2012] EWCA Civ 532, [2013] 2 FLR 1070. Under a consent order the wife had received a substantial lump sum on the basis that she would use half of it in discharging a mortgage on her home. In the event she had repaid only part of the mortgage debt and had invested in a non income bearing bond the sum which she had thus elected not to apply to full clearance of the mortgage. When, later, a judge came to capitalise her right to continuing periodical payments, he included in his calculation of her need the amount of interest payable by her in respect of the residual mortgage debt. The Court of Appeal held that the inclusion had been wrong. Thorpe LJ said: Lewison LJ said: 12. It seems to me little more than common sense that if a recipient of a lump sum twice the size of the mortgage on the final matrimonial home elects to hold back capital made available for the mortgage discharge in order to invest in a bond that bears no income, she cannot look to the payer thereafter for indemnity or contribution to the continuing mortgage interest payments. That seems to me to be an absolutely self evident point. 21. the need to pay the mortgage at all arose from her own choice not to apply the lump sum in discharging the existing mortgage The financial consequences of her investment choice are her responsibility. It is wrong in principle for the husband to have to continue to fund the mortgage. Mr Feehan QC, who, like Ms Dunseath, nobly appears for the wife without fee, seeks to distinguish the mortgage instalments disallowed in the cases of Pearce and Yates from payments of rent. I see no relevant distinction. He also submits that, unlike the present case, all three of the decisions concerned the capitalisation of an entitlement to periodical payments and that what was there rightly disallowed was the insinuation into the lump sum thus payable of a sum more reflective of an impermissible second claim for capital provision than of a permissible claim for conversion into capital of an income entitlement. Mr Feehan relies in particular on the statement of Thorpe LJ in the Pearce case, quoted at para 36 above. I reject the submission. As the Court of Appeal valuably established in that case, the first step in the exercise of capitalisation is a calculation of the amount of periodical payments to which, in the absence of capitalisation, the payee would then have been entitled. It was in the course of making this calculation that in the three decisions the objectionable elements of the claim were disallowed. Even had there been no capitalisation of the entitlement to periodical payments, those elements would therefore have been disallowed in quantifying the amount of the ongoing order for periodical payments. The cases of Pearce, North and Yates were correctly decided. The answer to the question posed in para 1 above is yes. By its terms that question asks only whether a court would be entitled, rather than obliged, in the circumstances there identified to decline to require the husband to fund payment of the rent. Its reference to the courts entitlement to do so serves to respect the wide discretion conferred upon it by section 31(1) and (7) of the Act in determining an application for variation of an order for periodical payments. But, in the passages quoted above, the Court of Appeal has expressed itself in forceful terms; and a court would need to give very good reasons for requiring a spouse to fund payment of the other spouses rent in the circumstances identified by the question. A spouse may well have an obligation to make provision for the other; but an obligation to duplicate it in such circumstances is most improbable. The judge was clearly entitled to decline to vary the order for periodical payments so as to require the husband to pay all of the wifes rent. The order of the Court of Appeal should be set aside and his order restored.

The Appellant and Respondent are former husband and wife. They divorced in 2002 after a marriage of approximately fifteen years, and the financial issues in the divorce were resolved by way of a consent order. Under the terms of that order the wife received 230,000 in settlement of her capital claims against the husband, and it was also agreed that the husband would make periodical payments to her at an annual rate of 13,200. It was reasonably anticipated by the husband that the wife would use the 230,000 to purchase a suitable home for herself and their son without a mortgage, as the wife had been suffering from ill health which made it difficult for her to work. In the event, however, the wife did manage to take out a mortgage, and she duly purchased a more expensive home for 345,000. Between 2002 and 2009 the wife sold and purchased a series of different properties, and with each purchase the amount which she borrowed increased. In addition, she did not necessarily reinvest all of the sale proceeds from one property into the next and seemingly spent the balance, with the result that the amount of capital she had decreased over time. Eventually, in 2009 the wife sold her final property and began to rent accommodation. By April 2015, when the first instance judge heard the case, the wife had no capital, and she had debts of around 42,000. The hearing before the judge was to determine two cross applications made under s.31(1) of the Matrimonial Causes Act 1973. The husband had applied for the discharge or downwards variation of the order for periodical payments, whereas the wife had applied for the order for periodical payments to be varied upwards. In determining the applications the judge noted that there was a shortfall of 4,092 per annum between the wifes current needs and, when coupled with her own earnings, the existing level of the periodical payments. However, he also held that, although the wifes actions had not been profligate, she had not managed her finances wisely and her current financial needs, in particular her need to pay rent, had been increased by the choices which she had made. Consequently, the judge considered that it would be unfair to the husband if he had to make a full contribution to the wifes rental costs. The judge therefore declined to vary the order for periodical payments either upwards or downwards. This meant that the husband would continue to contribute to around 60% of the wifes rental costs, and the wife would have to adjust her expenditure to accommodate the shortfall. The wife appealed against this decision to the Court of Appeal, and was successful. The Court of Appeal considered that the judge had not given sufficient reasons why all of the wifes basic needs should not be met by the periodical payments from the husband, and increased the level of periodical payments to cover her shortfall, i.e. to 17,292. The husband now appeals against this decision to the Supreme Court. The Supreme Court unanimously allows the appeal, concluding that the judge was entitled to decline to vary the order for periodical payments so as to require the husband to pay all of the wifes rental costs. Lord Wilson gives the judgment with which Lady Hale, Lord Carnwath, Lord Hughes and Lord Hodge agree. The husband was granted permission to appeal to the Supreme Court only on a single ground whether, in light of the fact that provision had already been made for the wifes housing needs in the capital settlement, the Court of Appeal was entitled to interfere with the judges decision not to increase the periodical payments so as to cover all of the wifes current rental costs [32]. The Court of Appeal had erred in saying that the judge had given no reason for declining to increase the order for periodical payments the judge had given a clear reason, namely that the wifes unwise decisions in relation to her capital had increased her basic needs by requiring her to pay rent, and that it was consequently unfair to expect the husband to meet these increased needs in full [33]. The Court of Appeal should have considered the impact of the original capital payment on the wifes current need to pay rent, and this involved a consideration of three earlier Court of Appeal authorities: Pearce v Pearce [2003] EWCA Civ 1054, North v North [2007] EWCA Civ 760, and Yates v Yates [2012] EWCA Civ 532 [34 38]. These cases were correctly decided and in light of this the judge was entitled, although not obliged, to decline to require the husband to fund payment of the rent in full. This respects the wide discretion conferred upon the court under section 31(1) and (7) of the Matrimonial Causes Act 1973 in determining an application for variation of an order for periodical payments. Moreover, a court would need to give very good reasons for requiring a spouse to fund payment of the other spouses rent in the circumstances of this case. A spouse may well be obliged to make provision for the other spouse, but an obligation to duplicate that provision in situations such as this is improbable [40].

0-8k

This appeal raises two important questions, one procedural and the other substantive, arising out of the decision of a planning inspector under the Planning (Listed Buildings and Conservation Areas) Act 1990 (the Listed Buildings Act). It concerns the correct treatment of a pair of early 18th century lead urns (or finials), attributed to the Flemish sculptor John van Nost, each resting on a limestone pedestal of a slightly later date. The two vases, together in each case with its plinth, were described in the judgments below as the items. I shall do the same. There is no doubt as to their artistic significance, which led to them being sold at auction in 2009 for 55,000. There is however a dispute as to whether they were properly treated as buildings under that legislation; but also a prior question as to whether such a dispute could and should have been addressed by the planning inspector in the proceedings before him. Factual background The items were originally at Wrest Park in Bedfordshire, owned by the first Duke of Kent. According to the 2009 auction particulars Wrest Park was one of the grandest and most admired gardens established in England in the first part of the 18th century. Apparently, a large plan of the garden by John Roque in 1735 showed the items flanking the entrance to the gardens. They remained at Wrest Park until 1939, when it was sold by the then owner, Mr J G Murray, who took various items of statuary, including these items, with him to Coles Park, Buntingford in Hertfordshire. In 1954 55, following the death of Mr Murray, his estate was left to a trust, with his grandson, Major R P G Dill, as a lifetime beneficiary. In 1955 56, under Major Dill, Coles Park was sold and he took the items with him to the Dower House, Buntingford. Major Dill sold the Dower House in 1962, when he moved to Badgers Farm, Idlicote, Warwickshire, again taking the items with him. In 1973 he sold Badgers Farm and moved to Idlicote House. He again took the items with him and placed them on either side of a path in the gardens which had served as the front drive to the house since the 1820s. No alteration was made to the garden design to accommodate the items, which were free standing. The piers were not attached to the ground and the urns were not attached to the piers. In 1966 Idlicote House had been designated a Grade II listed building. In June 1986 the items were themselves added to the list under section 54 of the Town and Country Planning Act 1971. Each was described as follows in both of the list entries: Pier surmounted by urn C18. Limestone and lead. Square pier with panelled sides, moulded stone plinth and chamfered cornices. Lead urn is decorated with high relief cherubs heads and flame finial. The listing decision and paperwork on which it was based have not been found despite enquiries. Although notice of the listing was required to be given to the owner or occupier by the local planning authority, there appears to be no extant record of such a notice. However, in January1987 (six months after listing the delay has not been explained) the items were entered on the local land charges register. The present owner, Mr Marcus Dill, acquired the house and the items in 1993. He was not aware of the listing of the items, and does not understand that his father, Major Dill, was aware of it. In 2009 he removed and arranged for sale of the items at auction. English Heritage was notified in advance and was sent the auction catalogue (as a potential purchaser) but did not respond. It is understood that they have since been removed from the United Kingdom. As to the physical qualities of the items, and the method of removal, I take the following (which I do not understand to be contentious) from Mr Dills statement in the planning appeal: The piers consist of limestone pedestals of a slab rather than solid construction. Consequently they were not especially heavy. Together a pier and finial was 274cm high . At Idlicote House the pedestals were resting on concrete slabs which were on the ground. They were not fixed to the slabs. The finials were also sitting on the pedestals without any attachment. The top of the piers can be removed. When they were taken from Idlicote House the finials and the top of the piers were lifted together and then the remaining part of each pier lifted. The items were lifted onto a Hiab lorry by its crane. Procedural history In 2014 the local planning authority became aware that the items had been removed and began correspondence with Mr Dill. On 29 April 2015 they wrote to Mr Dill informing him that listed building consent had been required for their removal and threatening formal action. On 17 June 2015 Mr Dill made a retrospective application for listed building consent. This was refused by the local planning authority on 11 February 2016. In response to consultation on the application, Historic England had advised that the grounds for listing these structures were the same as for any listing, that is their special architectural and historic interest. They observed that: Many garden items (as well as structures such as buildings relocated in open air museums), including statues and urns have been listed after they have been moved because they still qualify under that definition. On 26 April 2016, the local planning authority issued a listed building enforcement notice requiring the reinstatement of the items at Idlicote House. Mr Dill appealed to the Secretary of State against the refusal of listed building consent and the enforcement notice on several grounds, including that the items were not buildings. The appeals were considered together by a planning inspector appointed by the Secretary of State, who gave his decision dismissing the appeals in a letter dated 19 January 2017. He took the view, in summary, that the status of the items as buildings was established by the listing; that he could not reconsider that issue; and, that issues of property law or the so called Skerritts tests of size, permanence and degree of annexation (see below) were irrelevant. The view that the status of the item as a building was not open to challenge was upheld by Singh J in the High Court ([2017] EWHC 2378 (Admin)) and by the Court of Appeal ([2018] EWCA Civ 2619; [2019] PTSR 1214). In the leading judgment, Hickinbottom LJ (with the agreement of McCombe and Coulson LJJ) held: In my view, the wording of the relevant provisions in the Listed Buildings Act make clear that it was the intention of the statute that, for the purposes of applications for listed building consent and enforcement (and appeals from the same), being on the list is determinative of the status of the subject matter as a listed building, the protection given by the Act deriving from that status. (para 33) He thought that view was supported by the statutory background, and was not displaced by any of the authorities relied on by Mr Harwood QC for Mr Dill. That conclusion made it unnecessary to consider the separate grounds relating to the correct test for categorisation of such items as buildings (paras 46 50). McCombe LJ (para 61), concurring, noted the possible conflict with the view expressed by him at first instance in Chambers v Guildford Borough Council [2008] EWHC 826 (QB); [2008] JPL 1459, but agreed with Hickinbottom LJ (para 38) that the real issue in that case was different. Two issues are agreed as arising before the Supreme Court, in short: i) Whether an inspector considering an appeal under section 20 or section 39 of the Listed Buildings Act can consider whether or not something on that list is a building. ii) (In so far as this issue arises) what criteria are relevant in determining whether an item appearing in its own right in the statutory list is a building for this purpose: whether concepts of property law (the extent and purpose of a structures annexation), or the criteria set out in Skerritts of Nottingham Ltd v Secretary of State for the Environment, Transport and Regions (No 2) [2000] JPL 1025 (size, permanence and degree of annexation). Legislation The current statutory provisions are contained in the Listed Buildings Act. They are subject to minor variations in the same form as enacted in the Town and Country Planning Act 1968, and repeated in subsequent consolidations. For present purposes it is sufficient to refer to the current Act. Section 1(1) requires the Secretary of State to compile lists of buildings of special architectural or historic interest. Section 1(5) provides: In this Act listed building means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and for the purposes of this Act a) any object or structure fixed to the building; b) any object or structure within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before 1 July 1948, shall be treated as part of the building. Subsection (5A) enables the list to indicate that particular objects or structures mentioned in subsection (5)(a) or (b) are not to be treated as part of the building for the purposes of this Act; or that any part or feature of the building is not of special architectural or historic interest. In this judgment I shall refer to the second part of subsection (5) (and for the purposes of ) as the extended definition. I shall refer to objects or structures within paragraph (b) as curtilage structures. The word building is not separately defined in this Act. By section 91(2), except where the context otherwise requires, it has the same meaning as in section 336 of the Town and Country Planning Act 1990 which provides: Building includes any structure or erection, and any part of a building, as so defined, but does not include plant or machinery comprised in a building. Section 7 provides that no person shall execute or cause to be executed any works for the demolition of a listed building or for its alteration or extension in any manner which would affect its character as a building of special architectural or historic interest, unless the works are authorised under section 8. By section 9(1), if a person contravenes section 7, he shall be guilty of an offence. Section 8 provides for listed building consent to be granted by a local planning authority or the Secretary of State, and section 10 makes provision for the making of applications for such consent. Section 16(1) provides that the local planning authority or the Secretary of State may grant or refuse an application for listed building consent and, if they grant consent, may do so subject to conditions. By section 16(2), in considering whether to grant consent, the local planning authority or the Secretary of State: shall have special regard to the desirability of preserving the building or its setting or any features of special architectural or historic interest which it possesses. Section 20(1)(a) confers the right to appeal to the Secretary of State against a refusal of consent by a local planning authority. By section 21(3): The notice of appeal may include as the ground or one of the grounds of the appeal a claim that the building is not of special architectural or historic interest and ought to be removed from any list compiled or approved by the Secretary of State under section 1. By section 22(1), on an appeal the Secretary of State may deal with the application as if it had been made to him in the first instance, and may exercise his power under section 1 to amend any list compiled under section 1 by removing from it the building to which the appeal relates. Section 20 appeals may be determined by a person appointed by the Secretary of State (in other words a planning inspector) who has the same powers as the Secretary of State. Section 62 provides: (1) Except as provided by section 63, the validity of [a decision on an appeal under section 20] shall not be questioned in any legal proceedings whatsoever. Section 63(1) provides for a challenge by way of application to the High Court on legal grounds. Section 38 confers a power on a local planning authority to issue listed building enforcement notices. Section 39(1) provides for an appeal from such a notice to the Secretary of State on any of the following grounds (so far as potentially relevant to this appeal): (a) interest; (b) section 9(1) have not occurred; that the building is not of special architectural or historic that the matters alleged to constitute a contravention of Section 41(6): that those matters (if they occurred) do not constitute (c) such a contravention; (d) ; (e) that listed building consent ought to be granted for the works, or that any relevant condition of such consent which has been granted ought to be discharged, or different conditions substituted; On the determination of an appeal the Secretary of State may (a) grant listed building consent for the works to which the listed building enforcement notice relates or for part only of those works; (b) ; (c) if he thinks fit, exercise his power under section 1 to amend any list compiled or approved under that section by removing from it the building to which the appeal relates. Section 64 provides: The validity of a listed building enforcement notice shall not, except by way of an appeal under section 39, be questioned in any proceedings whatsoever on any of the grounds on which such an appeal may be brought. Section 65 gives a right to appeal to the High Court on legal grounds against a decision of the Secretary of State or inspector on an enforcement appeal under section 39. The first issue is designation as a listed building conclusive? Without disrespect to the courts below, I can deal with the first issue relatively shortly. The principles are not in doubt. As Mr David Elvin QC for the Secretary of State rightly accepts (in the words of his written submissions, citing Boddington v British Transport Police [1999] 2 AC 143): The issue of statutory construction is subject to the rule of law that individuals affected by legal measures should have a fair opportunity to challenge these measures and to vindicate their right in court proceedings, and there is a strong presumption that Parliament will not legislate to prevent individuals from doing so. The same principle is reflected in the European Convention on Human Rights article 6, under which an individual must have a clear, practical opportunity to challenge an act that is an interference with his rights: Bellet v France CE:ECHR:1995:1204JUD002380594, para 36. However, as Mr Elvin also correctly submits, that principle needs to be read in the context of the particular statutory scheme in question (citing Lord Hoffmann in R v Wicks [1998] AC 92, 117B). In the present scheme, he submits, identification as a building is not one of the matters that can be questioned through the statutory appeal route; but the right to challenge the validity of the listing by judicial review provides the fair opportunity required by the principle. Wicks is of particular relevance because it arose under the parallel enforcement provisions for breach of planning control. It concerned a prosecution for failure to comply with an enforcement notice for breach of planning control under the Town and Country Planning Acts. The relevant statute had a provision (in similar terms to section 64 of the Listed Buildings Act: see para 19 above) excluding challenges to the validity of an enforcement notice other than by the statutory appeal procedure. It was held that on a proper construction of the relevant provisions all that was required to be proved in the criminal proceedings for breach of an enforcement notice was that the enforcement notice issued by the local planning authority was formally valid, and that it was not open to the defendant to raise other public law challenges to its validity, such as bad faith, bias or procedural impropriety (residual grounds), by way of defence to the charge. In my view that authority if anything supports the appellants case. There was no issue but that the enforcement appeal could encompass every aspect of the planning case. As Lord Hoffmann said (p 122D): I do not think that in practice hardship will be caused by requiring the residual grounds to be raised in judicial review proceedings. The statutory grounds of appeal are so wide that they include every aspect of the merits of the decision to serve an enforcement notice. The residual grounds will in practice be needed only for the rare case in which enforcement is objectively justifiable but the decision that service of the notice is expedient is vitiated by some impropriety. As Keene J said in the Court of Appeal, the owner has been served with the notice and knows that he has to challenge it or comply with it. His position is quite different from that of a person who has contravened a byelaw, who may not have heard of the byelaw until he contravened it. (Emphasis added) If in that context fairness requires that the grounds of appeal should extend to every aspect of the merits of the enforcement action in planning cases, it is hard to see why it should be any different in the context of a listed building enforcement notice. In particular, as will appear from the cases considered later in this judgment, whether a particular structure constitutes a building, and its erection a building operation, is an issue which may undoubtedly be raised in the context of a planning enforcement appeal. As those cases show, it may raise difficult issues of factual judgement, which are much more appropriate for a planning inspector than for the High Court in judicial review. No convincing reason was offered as to why the question whether something qualifies as a building should be treated in a different way in the listed building context. One advantage of allowing these issues to be dealt with through the planning appeal route is that it enables the inspectorate, with appropriate legal advice, to develop workable criteria on a case by case basis. Mr Elvin points to the desirability of certainty as to the identification of listed buildings, which may have to be considered as material considerations in various statutory contexts. He cites for example Lord Hope of Craighead in City of Edinburgh Council v Secretary of State for Scotland [1997] 1 WLR 1447: The Act assumes, in regard to the statutory procedures, that the question whether or not the building is a listed building can be determined simply by inspecting the list which the Secretary of State has prepared. That of course is correct as a general proposition, but it says nothing about the circumstances in which a listing may be questioned. Similar uncertainty attaches to the possibility of a successful appeal (under ground (a)) on the grounds of lack of special interest. Against the desirability of certainty, is the fact that (unlike breach of planning control) contravention of listed building control is a criminal offence, whether or not an enforcement notice is served. In that context the starting point must be the presumption that the accused should be able to raise any grounds relating to the lawfulness of the proceedings on which the prosecution is based (see eg R v Wicks at p 106 per Lord Nicholls of Birkenhead). Furthermore, Mr Elvins argument overlooks the form of the statutory definition of listed building. A listed building means a building which is included in [the] list . Thus there are two essential elements: it must be both a building and it must be included in [the] list . If it is not in truth a building at all, there is nothing to say that mere inclusion in the list will make it so. Section 7 prohibits the demolition of a listed building, and section 9(1) makes contravention of section 7 a criminal offence. There is nothing to prevent the accused arguing that the item on the list is not a building and so not within the definition. Short of a specific provision that the listing is to be treated as conclusive for such purposes, there is no reason to displace the ordinary presumption that the accused may raise any relevant defence. Notably there is no equivalent to the exclusivity provision of section 64. If that is the case under section 9, then the same approach applies to the grounds of appeal under section 39. Under section 39(1)(c) the appellant can argue that the the matters alleged to constitute a contravention of section 9(1) do not constitute such a contravention. If there would be no contravention of section 9(1), because the relevant item is not a building, there is no reason why the same point cannot be taken under section 39. If that ground is made out on the facts, the Secretary of State has power to deal with the matter by removing it from the list. There might be a theoretical question whether this would operate retrospectively, so as to preclude any further action based on the original listing. However, I do not see that as a practical problem, given that there would be an authoritative decision by the Secretary of State to cancel the listing, specifically on the grounds that the items were not properly categorised as buildings. That would carry with it the clear implication that they should never have been listed in the first place, and should be sufficient in practice (if not in law) to protect the owner against any further proceedings. Accordingly, I would allow the appeal on the first issue. In principle (subject to consideration of the second issue), this means that the enforcement appeal must be remitted to the Secretary of State for redetermination. I am conscious that there is before us also an appeal in respect of the application for listed building consent. Although this may in theory raise different legal issues, I do not understand them to have any practical consequences in this case which cannot be dealt with in the context of the enforcement appeal. Subject to any submissions to the contrary, it should be possible to leave that aspect to be dealt with so far as necessary by agreement between the parties. The second issue were they buildings? On one view, if the appeal has to be remitted to the Secretary of State in any event, it might be better to leave the second issue for consideration at that level. However, there is in my view a need for more general guidance as to the legal principles in play. This case has revealed a disturbing lack of clarity about the criteria which have been adopted by the relevant authorities, not only in this instance but more generally, in determining whether free standing items such as these are regarded as qualifying for listing protection, whether as curtilage structures, or as separate buildings as in this case. Even now, in spite of the issue having been raised by Mr Dill in 2015, and after a planning appeal and three court hearings, he has had no official explanation of the criteria by which it was determined that these items qualified as buildings. It is useful to begin by looking at the wide variety of items which may fall to be considered, before going on to look at the development of the relevant legislation, and case law, and its application to different categories, including the items in issue in this case. Garden and Park Structures A good idea of the significance and variety of structures under potential consideration for listing purposes is given by a publication by Historic England Garden and Park Structures Listing Selection Guide (December 2017). This is one of 20 listing selection guides issued by Historic England, which has adapted and updated the selection guides originally issued by English Heritage in 2011. The Garden and Park Structures guide overlaps with other listing selection guides, including those for commemorative structures and for street furniture (including items such as fountains). The introduction explains its purpose: This selection guide is devoted to individual built structures found in gardens and parks, rather than the designed landscapes themselves All designed landscapes are likely to contain buildings and other hard landscaping features such as balustraded terraces that will often make a positive contribution to the overall character of the place. This selection guide helps identify which structures meet the test of special interest for listing. (p 1) The following pages contain a fascinating historical survey of the role of such structures in designed landscapes, parks and gardens since medieval times. It makes clear the extraordinary variety of objects or structures apparently considered for listing, by no means limited to features such as balustraded terraces. I take three examples: i) Wrest Park itself, as it was in the 19th century (p 5), is given as an example of reversion to the severely formal fashions of the 17th and earlier 18th centuries: with terraces, balustrades, vases, basins and fountains, elaborate steps and gateways, seats, summerhouses, and statuary. Some of these latter features, it is said, were industrially produced, moulded from terracotta, Coade stone, or cast iron. A photograph shows the restored parterre at Wrest Park, with formal planting and some large classical statues, which appear to be an intrinsic part of the design. We were informed by Mr Elvin that these are not fixed in place other than by their own weight, and are separately listed as buildings in their own right. On the same page, the guide also refers to raised terraces, which were sometimes decorated with elaborate flower urns. At p 10 the guide refers to statuary, urns and other features such as sundials and astronomical devices which adorned formal gardens; and at p 11 it states that even when these have been moved from elsewhere, pre 1850 examples will generally merit designation. ii) A more recent item is shown by a photograph of Henry Moores Reclining Woman (1947), at Dartington Hall, a large stone sculpture resting on a substantial stone base, said to be listed Grade II (p 7). iii) Perhaps the most unusual example is the group of 27 life size Crystal Palace dinosaurs (listed Grade I), survivors from an exceptional High Victorian pleasure ground created in the early 1850s, [which] show the singularity park features could sometimes attain. (p 18) Although the guide gives much useful information about the assessment of the historic interest of such objects and uses the word structures to describe them, it contains no discussion of the criteria by which they are to be treated as buildings within the statutory definition, nor in particular whether they are thought to qualify in their own right, or under the extended definition. I will return to this issue in the next section of this judgment. In considering the correct legal and policy approach to such garden and park structures, it is also important to bear in mind the limited protection available for the gardens and parks themselves. It was not until 1983 that there was any statutory recognition of the need to identify and safeguard historic gardens. Section 8C of the Historic Buildings and Ancient Monuments Act 1953, introduced by paragraph 10 of Schedule 4 of the National Heritage Act 1983, provided for the preparation by English Heritage of a register of gardens and other land situated in England and appearing to them to be of special historic interest. No doubt for practical reasons, there is no statutory protection for the garden layout itself nor any restriction on works within a registered garden, but being on the register may be required to be taken into account as a material factor in a range of planning decisions. There is no protection for garden and park structures as part of a registered garden as such. If the garden is attached to a listed building, they may be protected as curtilage structures, under the extended definition, but as part of the listed building, not of the garden. Identifying a building legislation and case law As has been seen, although listed building control has a long history, dating back before the Town and Country Planning Act 1947, the provisions were substantially recast in the Town and Country Planning Act 1968. (There is a detailed history in Shimizu (UK) Ltd v Westminster City Council [1997] 1 WLR 168, 175 per Lord Hope. That case itself was concerned with a relatively narrow issue relating to the scope of demolition and is of no direct assistance in this case.) Protection is given to buildings as defined. For this purpose, as already noted, the statute adopts the ordinary planning definition of building as including a structure or erection. The one significant variation comes in the extended definition, that is the provision that certain objects or structures are to be treated as part of the building, if they are either fixed to the building or within the curtilage of the building and form[ing] part of the land (subject, since 1986, to an exception for those placed since July 1948). It is important to note that the extended definition does not result in the item in question becoming a listed building in its own right; it merely results in its being treated as part of the building to which it is attached, or in whose curtilage it stands. That is to be distinguished from the circumstances in which a garden object or structure may qualify for listing as a building in its own right. Unfortunately, this critical distinction is blurred in the other official guidance to which we were referred. That is a Department for Digital, Culture, Media and Sport publication Principles of Selection for Listed Buildings (November 2018). This states: For the purposes of listing, a building includes any structure or erection and a listed building includes any object or structure: (a) fixed to it; or (b) within its curtilage which, although not fixed to it, forms part of the land and has done so since before 1 July 1948, unless the list entry expressly excludes such things. In some cases, such as for works of art or sculptures, it will be necessary to consider the degree and purpose of annexation to the land or building to determine whether it may be listed under the 1990 Act. (para 6) This acknowledges (rightly as will be seen) the relevance of the degree and purpose of annexation in considering whether a work of art or sculpture forms part of the land under the extended definition. But the second sentence might be taken to confuse that issue, relevant to whether the sculpture is to be treated as part of a building already on the list, with the distinct question whether the sculpture itself may be listed under the 1990 Act as a separate entry. This depends upon whether the sculpture constitutes a building, in the sense of being a structure or erection within the statutory definition, in relation to which the degree and purpose of annexation to the land may be relevant factors but are not necessarily conclusive. In what follows it will be convenient to consider first the application of the extended definition to free standing objects such as sculptures, before considering the criteria by which they might be treated as buildings in their own right. Garden objects or structures under the extended definition The extended definition, first introduced in the Town and Country Planning Act 1968, seems to have been designed to clarify the position following the case of Corthorn Land and Timber Co Ltd v Minister of Housing and Local Government (1966) 17 P & CR 210. Corthorn concerned a building preservation order made under section 30(1) of the Town and Country Planning Act 1962, prohibiting the removal from a listed building of various portrait panels, wooden panels, a large wood carving of the Crowning with Thorns, and a large wooden equestrian figure of St George and the Dragon. The issue was whether they were part of the listed building. In deciding that they were, Russell LJ applied a property law approach, saying: It is not, in my judgment, open to serious doubt that these items were all fixed and annexed in their places as part of the overall and permanent architectural scheme and intended in every sense to be annexed to the freehold (p 217) In Debenhams plc v Westminster City Council [1987] AC 396, 408 409 Lord Mackay of Clashfern confirmed that the word fixed in the extended definition was to have the same connotation as in the law of fixtures so that any object or structure fixed to a building should be treated as part of it, thereby put[ting] beyond question the matter that was decided by Russell LJ in the Corthorn case . Corthorn was not concerned with objects or structures within the curtilage of a listed building. We were not referred to any contemporary information as to the derivation of that part of the extended definition in the 1968 Act. It can be assumed to have been a recognition of the important part often played by such objects in the overall architectural composition or setting of a listed building, even though the architectural quality of the curtilage structure itself is not part of the test. The requirement that they should form part of the land is clearly designed to tie this part of the definition, like the first part, to real property concepts under the common law. It is not known what if any assumptions would have been made in 1968 about how the common law would treat statues or other ornamental objects resting only by their own weight. Reliance may have been placed on the then current edition of Megarry & Wade, The Law of Real Property, 3rd ed (1966) which stated: Statues, figures, vases and stone garden seats have been held to become part of the land because they are essentially part of the design of the house and grounds, even though standing by their own weight. This was supported by a footnote reference to DEyncourt v Gregory (1866) LR 3 Eq 382, but with a cautionary note: the authority of this decision is not great; see De Falbe [1901] 1 Ch 523, at 531, 532. Some years after the 1968 Act the treatment of such objects in real property law was considered by the Court of Appeal in Berkley v Poulett [1977] 1 EGLR 86. The dispute was about certain pictures and other objects which, it was said, should pass as fixtures on the sale of a house. The disputed items included a statue and sundial in the garden. The court was agreed that the sundial was a chattel, but there was disagreement as to the sculpture. Scarman LJ, in the leading judgment (pp 88 89), with which Stamp LJ in substance agreed (p 96), explained that, following Leigh v Taylor [1902] AC 157: The answer today to the question whether objects which were originally chattels have become fixtures, that is to say part of the freehold, depends upon the application of two tests: (1) the method and degree of annexation; (2) the object and purpose of the annexation. Having discussed the principles and the other objects in dispute, he turned to the statute and sundial. The latter was a small object which had been detached from its pedestal many years earlier and thus ceased to be part of the realty. Of the statue he said: The statue was heavy. It weighed 10 cwt and stood 5 ft 7 in high on its plinth. There is an issue as to whether it was cemented into the plinth or rested on its own weight. The question is not decisive, for, even if it was attached by a cement bond, it was (as events proved) easily removable. However, upon the balance of probability, I agree with the Vice Chancellor in thinking it was not attached. The best argument for the statue being a fixture was its careful siting in the West Lawn so as to form an integral part of the architectural design of the west elevation of the house. The design point is a good one so far as it goes: it explains the siting of the plinth, which undoubtedly was a fixture. But what was put upon the plinth was very much a matter for the taste of the occupier of the house for the time being. We know that at one time the object on the plinth had been a sundial. At the time of the sale it was this statue of a Greek athlete. The plinths position was architecturally important: it ensured that whatever stood on it would be correctly positioned. But the object it carried could be whatever appealed to the occupier for the time being. Sundial or statue it did not matter to the design, so long as it was in the right place a result ensured by the plinth which was firmly fixed into the ground. Being, as I think, unattached, the statue was, prima facie, not a fixture, but, even if it were attached, the application of the second test would lead to the same conclusion. Goff LJ took a different view of the statue (p 90) which had been placed at a focal point in the grounds, not for better enjoyment as a chattel but for the permanent enhancement of the beauty of the grounds, a case where resting upon its own bulk was a sufficient annexation. On that point he regarded DEyncourt v Gregory (1866) LR 3 Eq 382 as still authoritative, not overlooking the criticisms in In re De Falbe [1901] 1 Ch 523, which in his view related to the inferences drawn from the facts, rather than the principle that a thing may be a fixture because it is part of the architectural design. As I read the judgments the difference was not as to the principle, but as to its application to the particular facts. This view accords with the current 9th edition of Megarry & Wade, (2019) para 22.010, which repeats the relevant passage from the earlier editions, with the same case references, but adds: the principle that an object resting on its own weight can be a fixture if it is part of the overall design of the property has been approved: Berkley v Poulett [1977] 1 EGLR 86 at 89. Although that is not a precise formulation, it follows in my view that a statue or other ornamental object, which is neither physically attached to the land, nor directly related to the design of the relevant listed building and its setting, cannot be treated as a curtilage structure and so part of the building within the extended definition. Further confirmation of that approach can be found in a much more recent judgment of the High Court. It was held that a Henry Moore bronze sculpture Draped Seated Women, weighing 1,500 kg and resting on a plinth, which in 1962 had been placed by the London County Council in a new housing estate, under its policy of promoting works of art in public places, remained a chattel rather than part of the land (Tower Hamlets London Borough Council v Bromley London Borough Council [2015] EWHC 1954 (Ch); [2015] LGR 622). The judge (Norris J) noted as material that the sculpture was an entire object in itself, resting by its own weight on the ground, and able to be removed without damage, and that it did not form part of an integral design of that estate (para 17). Garden objects or structures as buildings object or structure may qualify as a listed building in its own right. Both sides have referred to the so called Skerritts test, that is a three fold test which involved considering size, permanence and degree of physical attachment. That formulation was derived from the judgment of Schiemann LJ in the Court of Appeal in Skerritts of Nottingham Ltd v Secretary of State for the Environment, Transport and the Regions (No 2) [2000] JPL 1025, para 39. It can in I turn to the criteria which might be relevant in determining whether such an turn be traced back through the leading planning case on the definition of building in the planning statutes (Barvis Ltd v Secretary of State for the Environment (1971) 22 P & CR 710, DC), and to the judgment of Jenkins J in a rating case Cardiff Rating Authority v Guest Keen Baldwins Iron and Steel Co Ltd [1949] 1 KB 385. The Cardiff case was concerned with a different expression (plant in the nature of, a building or structure) in a different statutory context. In Barvis and Skerritts, however, the decisions turned on whether the item in question qualified as a building for the purpose of the definition in the relevant planning statute, which is the same definition (now contained in section 336 of the Town and Country Planning Act 1990) which applies for the purposes of the Listed Buildings Act. They refer to the Cardiff case for that purpose. The meaning of building was relevant to deciding whether the operations in issue qualified as building operations, as part of the statutory definition of development. The Cardiff case is relevant principally for a passage in the judgment of Jenkins J (pp 402 403) from which the three fold test was later derived. In addressing the question whether certain apparatus was or was in the nature of a building or structure, he said (as quoted by Bridge J in giving the leading judgment in Barvis (1971) 22 P & CR 710, 716): The general range of things in view consists of things built or constructed. I think, in addition to coming within this general range, the things in question must, in relation to the hereditament, answer the description of buildings or structures, or, at all events, be in the nature of buildings or structures. That suggests built or constructed things of substantial size: I think of such size that they either have been in fact, or would normally be, built or constructed on the hereditament as opposed to being brought on to the hereditament ready made. It further suggests some degree of permanence in relation to the hereditament, ie, things which once installed on the hereditament would normally remain in situ and only be removed by a process amounting to pulling down or taking to pieces. I do not, however, mean to suggest that size is necessarily a conclusive test in all cases, or that a thing is necessarily removed from the category of buildings or structures or things in the nature of buildings or structures, because by some feat of engineering or navigation it is brought to the hereditament in one piece. The question whether a thing is or is not physically attached to the hereditament is, I think, certainly a relevant consideration, but I cannot regard the fact that it is not so attached as being in any way conclusive against its being a building or structure or in the nature of a building or structure. Nor can I regard the fact that a thing has a limited degree of motion in use, either in relation to the hereditament or as between different parts of itself, necessarily prevents it from being a structure or in the nature of a structure, if it otherwise possesses the characteristics of such. As Bridge J held in Barvis at pp 716 717, in a judgment with which Lord Parker CJ and Widgery LJ agreed, if one substitutes throughout that passage the phrase structure or erection for the phrase structure or in the nature of a structure, this guidance is fully applicable to the considerations which govern the application of the definition in the Town and Country Planning Act 1962 (ie in section 221 of that Act, now re enacted as section 336 of the 1990 Act). Barvis was concerned with alleged development comprising the laying of a length of steel track and the mounting thereon of a moveable tower crane some 89 feet in height. The court upheld the Secretary of States view (disagreeing with the planning inspector) that it involved a building operation. Bridge J, giving the leading judgment, cautioned against reliance on the application of tests from real property law as to what amount to fixtures, rather than focusing on the statutory definition in the Act. He asked himself if the crane when erected was a building as defined, and said that if it was: I should want a great deal of persuading that the erection of it had not amounted to a building or other operation. Building includes any structure or erection. If, as a matter of impression, one looks objectively at this enormous crane, it seems to me impossible to say that it did not amount to a structure or erection. He found nothing in the statutory context to displace that impression: I would be very surprised if the planning legislation did not give to a planning authority the opportunity to control this kind of operation, and, in my judgment, this crane was not the less a structure or erection by reason of its limited degree of mobility on its rails on the site, nor by reason of the circumstance that at some future date, uncertain when it was erected, the appellants contemplated that it would be dismantled and the rails and beams broken out of their concrete beds and that it would be transported in pieces to other sites where it would be re erected for use in contract work. (pp 715 716) That view was confirmed by reference to the passage cited above from the judgment of Jenkins J in the Cardiff case. Bridge J distinguished a previous planning case, Cheshire County Council v Woodward [1962] 2 QB 126, DC, in which it was held that the Minister of Housing and Local Government had not erred in finding that the placing on a site of a mobile hopper and a mobile conveyancer, some 16 to 20 feet high, did not amount to development. Skerritts itself is of importance, both because it was the first time that the issue was considered at Court of Appeal level, and also because the three fold test derived from the Cardiff case was treated as of general application in the planning context. It is also useful as an illustration of how the planning inspector was able to treat those tests as workable guidance in a very different factual situation from that considered in the earlier cases. In the definition of building, Parliament has used the general concepts of erection and structure, rather than more precise and specific terms, and these are applicable across a very wide range of cases. Therefore, the application of the definition requires an evaluative judgment to be made. The Court of Appeal confirmed that where the relevant decision maker, in that case the inspector, directs himself by reference to Barvis and the guidance in the Cardiff case and arrives at a rationally defensible conclusion, his decision on the application of the statutory definition will be upheld as lawful. The case itself related to a marquee erected in the grounds of a hotel, and retained on site between February and October each year. On appeal against an enforcement notice, the inspector had concluded that it was to be regarded as a building for planning purposes and that its erection was a building operation requiring planning permission. In respect of its size and method of assembly he said: The marquee is a substantial object which is about 40m long, including the additions, and some 17m wide and the ridge height is around 5m There is no direct evidence before me of the assembly method or period, but from my inspection, I consider that it took several days with a number of erectors and amounted to a sizable and protracted event. I imagine that its dismantling follows much the same process. It is assembled on site, not delivered ready made. I do not regard its considerable bulk to be de minimis in relation to planning controls. It was sitting on square metal plates which are spiked to the soil beneath and appeared to be held in place by its own considerable weight, the internal bracing and the ground spikes. The timber floor was supported by metal ground beams resting on the land. He concluded: I conclude that, as a matter fact and degree, the marquee, due to its ample dimensions, its permanent rather than fleeting character and the secure nature of its anchorage, is a structure which is to be regarded as a building for planning purposes The main issue in the Court of Appeal was whether the marquee had a sufficient degree of permanence to qualify as a building. The court held that the inspector had been entitled to arrive at the conclusion that he did. None of these cases is of direct assistance in deciding how to categorise an object of artistic significance in the listed building context. It is notable that in both Barvis and Skerritts there was a clear move away from real property analogies. That seems to me correct. As has been seen, real property concepts are relevant to the extended definition, but there is nothing to import them into the basic definition of building. Skerritts provides clear authority at Court of Appeal level for the three fold test, albeit imprecise, of size, permanence and degree of physical attachment. No preferable alternative has been suggested in this court. Given that the same definition of building is adopted in the Listed Building Act, it is difficult to see any reason in principle why the same test should not apply. On the other hand, notwithstanding the apparent width of the statutory definition, the mere fact that something had been erected on land was not sufficient to make it a building. Skerritts is a good illustration of the practical application of the relevant tests, and in particular of the importance of the method of erection (a sizable and protracted event It is assembled on site, not delivered ready made). In addition to the fact that installation occurred by erection, the degree of permanence of the location of the item on the site was significant. In the listed building context that need for something akin to a building operation when the structure is installed can be seen as the counterpart to the reference to works for the demolition as the relevant contravening act under section 7 of the Listed Buildings Act, which clearly envisages some form of dismantling (ie pulling down or taking to pieces in the words of Jenkins J in the Cardiff case) when the item is removed from the site. It is also important to keep in mind the purpose of listed building control, which is to identify and protect buildings of special architectural or historic interest. It is not enough that an object may be of special artistic or historic interest in itself; the special interest must be linked to its status as a building. That is implicit in the reference to architectural interest. But it is relevant in my view also to the concept of historic interest. The historic interest must be found not merely in the object as such, but in its erection in a particular place. For completeness I should note that no assistance is to be gained from another case mentioned by the inspector: R (Judge) v First Secretary of State [2005] EWHC 887 (Admin); [2006] JPL 996. The inspector cited Sullivan Js statement (para 17) that the treatment of items as a matter of property law was wholly irrelevant. But that was said in relation to the quite different question whether the dismantled components of something which had unquestionably been a listed building could, by the process of dismantling, become chattels rather than buildings and thereby lose their statutory protection as such. Not surprisingly the court rejected that interpretation as wholly incompatible with the purpose of the legislation. It throws no light on the present issue. At this point, it may be useful to consider how the Skerritts criteria might apply to the various forms of garden structure identified in the guide discussed in the previous section. In doing so I emphasise that we have not heard any detailed submissions on these matters. Nor were we shown any commentary which was critical of the existing guides from the Department for Digital, Culture, Media & Sport and Historic England. Taking the three examples selected above from the Historic England guide (para 31), the latter two are readily understandable. Even if the Dartington statue is resting by its own weight, the plinth appears as a substantial built structure, and together they appear to form an integral design for the site in which it is placed. Similarly, the Crystal Palace dinosaurs, having regard to their relative size and permanence (whether or not physically attached to the land) could reasonably have been seen as buildings in their own right. But the first of the examples is more debatable. It is hard to see how it could be appropriate to include without discrimination items such as vases, basins seats, . and statuary, without any indication of how they might be brought within any part of the definition, whether as separate buildings or as curtilage structures under the extended definition. In particular, most ordinary forms of garden vases or seats would be unlikely to have become part of the land in real property terms, nor would they naturally be regarded as buildings under any of the tests considered above. The present case I return finally to the two items at issue in this case. It is not, as I understand it, suggested that they would have qualified for protection as curtilage structures within the extended definition. I agree. It seems clear that, whatever might have been the position had they remained in Wrest Park, the vases and their piers did not fall to be treated as part of the listed building of Idlicote House. Not only had they had been placed on the land after July 1948, but also, being freely movable, there is no suggestion that they were related in any relevant way to the design of that particular listed building and its setting. The applicable real property tests were not satisfied. How then might they fare under the Skerritts criteria: size, permanence and degree of physical attachment? Again in the absence of full submissions anything we say can only be provisional. There are arguments both ways. On the one hand, it can be said, they comprised a set of elements which had to be assembled together (a structure), required a small crane to move them and to assemble them (as an erection), and were intended to occupy a stable and near permanent position in situ (with greater permanence than the marquee in Skerritts). On the other hand, they are not particularly large, compared for example with the items considered in the three planning cases. It may also be relevant that the vases themselves, which are the real focus of the special interest, are physically separate. If they had been resting on the ground, rather than a plinth, I doubt if it would have occurred to anyone that they might qualify as buildings. Relevant also is the apparent ease of their installation and removal (as compared for example to the works in Skerritts). These are issues which can only be satisfactorily investigated and determined in the context of a renewed appeal. Conclusion The second agreed issue asks us simply to determine whether the Skerritts criteria for identifying a building are also relevant in the listed building context. For the reasons given above I would answer that question in the affirmative. As indicated above, I do not think it is possible or appropriate for us to reach a concluded view on how those tests should be applied in this case. Not only do we not have a full view of the facts, but the issue also involves questions of factual evaluation which are best dealt with by a planning inspector in the context of a renewed appeal. I would in any event urge those responsible on the part of the Secretary of State to consider the criticisms I have made about the lack of reliable guidance in the existing publications on this subject. I understand that this will be deeply frustrating for Mr Dill. There is as I understand it no suggestion that he acted other than in good faith in disposing of items which he believed to be his own disposable property, and had been so treated by his family for several decades. Since this problem was first drawn to his attention by the local authority in April 2015 he has been attempting to obtain a clear ruling on that issue. On the view I have taken, that opportunity has been wrongly denied to him for five years. Even if his appeal were ultimately to fail, the practicability of restoring the vases to their previous location in the grounds of Idlicote House is uncertain. Accordingly, this courts formal order for remittal should not prevent the respondents from giving serious consideration to whether in all the circumstances it is fair to Mr Dill or expedient in the public interest to pursue this particular enforcement process any further.

This appeal raises two important questions about the interpretation and application of the Planning (Listed Buildings and Conservation Areas) Act 1990 (the Listed Buildings Act). The case concerns the correct treatment of a pair of early 18th century lead urns resting on limestone pedestals (the items). The items were originally commissioned for a historic garden at Wrest Park in Bedfordshire where they remained until 1939 but have been moved a number of times since then. In 1973 they were moved by Major Dill (Mr Dills father) to the garden of Idlicote House. In June 1986 the items were added to the list of listed buildings under s.54 of the Town and Country Planning Act 1971. There is no record of notice of the listing having been served, but in due course it was included in the register of local land charges. In 1993 the Mr Dill (the appellant) acquired the house and the items. He was not aware of the items presence on the list. In 2009 he sold them at auction. On 29 April 2015 the district council (the second respondents) wrote to the Mr Dill informing him that listed building consent had been required for the items to be removed. His retrospective application for consent was refused on 11 February 2016, following which on 26 April 2016 the council issued a listed building enforcement notice requiring the reinstatement of the items at Idlicote House. He appealed against the refusal of listed building consent and the issuing of the enforcement notice to the Secretary of State for Housing, Communities and Local Government (the first respondent). The grounds of appeal included the argument that the items were not buildings for the purposes of the Listed Buildings Act. The appeals were dismissed by a planning inspector on 19 January 2017. He took the view that the status of the items as buildings was established by the listing; that he could not reconsider the issue. Mr Dills appeal was rejected by the High Court (Singh J) and the Court of Appeal (McCombe and Coulson LJJ). Both courts below held that listing was conclusive of the items being buildings. The Supreme Court unanimously allows the appeal. Lord Carnwath gives the sole judgment, with which the other Justices agree. Whether listing is conclusive of the items being buildings for the purposes of the Listed Buildings Act It is a principle that individuals affected by a legal measure should have a fair opportunity to challenge the measure and to vindicate their rights in court proceedings. In applying this principle, the context of the particular statutory scheme in question is relevant [20]. In the parallel context of breach of planning control, the statutory grounds of appeal are so wide that they include every aspect of the merits of the decision to serve an enforcement notice. It is hard to see why it should be any different in the context of a listed building enforcement notice. Indeed, the question of whether something is a building may raise difficult issues of factual judgment which an inspector appointed under the statutory scheme is more appropriately placed to decide than the High Court on judicial review [22]. Under the statutory scheme a listed building means a building which is included in [the] list. It is an essential element that the thing in issue be a building. If it is not in truth a building at all, there is nothing to say that the mere inclusion in the list will make it otherwise. Section 7 prohibits the demolition of a listed building, and s.9(1) makes contravention of that prohibition a criminal offence. But there is nothing to prevent the accused arguing that the item demolished is not a building and so not within the definition [24]. As such, the question of whether the thing listed is in fact a building can be considered by the inspector on a statutory appeal [25]. The enforcement appeal must be remitted to the First Respondent for redetermination [26]. The application for listed building consent can be dealt with by agreement [27]. The relevant test for a building There is a need for general guidance on the legal principles in play in determining whether something constitutes a building [28]. In Skerritts of Nottingham v Secretary of State for the Environment Transport and Regions [2000] JPL 1025 a three fold test was adopted considering size, permanence and degree of physical attachment [46]. This case is important as the three fold test was treated as of general application in the planning context [50]. Along with other jurisprudence, it indicated a move away from real property analogies. Lacking a preferable alternative, and as the same definition of building as was in issue in Skerritts was adopted in the Listed Buildings Act, it is difficult to see any reason in principle why the same test should not apply [52]. The application of this test to the items is something to be considered in the context of the remittal of the appeal to the First Respondent [58].

8k-16k

The question at issue on this appeal is: in what circumstances is it permissible to sue an unnamed defendant? It arises in a rather special context in which the problem is not uncommon. On 26 May 2013 Ms Bianca Cameron was injured when her car collided with a Nissan Micra. It is common ground that the incident was due to the negligence of the driver of the Micra. The registration number of the Micra was recorded, but the driver made off without stopping or reporting the accident to the police and has not been heard of since. The registered keeper of the Micra was Mr Naveed Hussain, who was not the driver but has declined to identify the driver and has been convicted of failing to do so. The car was insured under a policy issued by Liverpool Victoria Insurance Co Ltd to a Mr Nissar Bahadur, whom the company believes to be a fictitious person. Neither Mr Hussain nor the driver was insured under the policy to drive the car. The statutory framework The United Kingdom was the first country in the world to introduce compulsory motor insurance. It originated with the Road Traffic Act 1930, which was part of a package of measures to protect accident victims, including the Third Parties (Rights Against Insurers) Act 1930. The latter Act entitled a person to claim directly against the insurer where an insured tortfeasor was insolvent. But it was shortly superseded as regards motor accidents by the Road Traffic Act 1934, which required motor insurers to satisfy any judgment against their insured and restricted the right of insurers to rely as against third parties on certain categories of policy exception or on the right of avoidance for non disclosure or misrepresentation. The statutory regime has become more elaborate and more comprehensive since 1934, but the basic framework has not changed. The current legislation is Part VI of the Road Traffic Act 1988. As originally enacted, it sought to give effect to the first three EEC Motor Insurance Directives, 72/166/EEC, 84/5/EEC and 90/232/EEC. It was subsequently amended by statutory instruments under the European Communities Act 1972 to reflect the terms of the Fourth, Fifth and Sixth Motor Insurance Directives 2000/26/EC, 2005/14/EC and 2009/103/EC. The object of the current legislation is to enable the victims of negligently caused road accidents to recover, if not from the tortfeasor then from his insurer or, failing that, from a fund operated by the motor insurance industry. Under section 143 of the Act of 1988 it is an offence to use or to cause or permit any other person to use a motor vehicle on a road or other public place unless there is in force a policy of insurance against third party risks in relation to the use of the vehicle by the particular driver (I disregard the statutory provision for the giving of security in lieu of insurance). Section 145 requires the policy to cover specified risks, including bodily injury and damage to property. Section 151(5) requires the insurer, subject to certain conditions, to satisfy any judgment falling within subsection (2). This means (omitting words irrelevant to this appeal) judgments relating to a liability with respect to any matter where liability with respect to that matter is required to be covered by a policy of insurance under section 145 of this Act and either (a) it is a liability covered by the terms of the policy or security , and the judgment is obtained against any person who is insured by the policy or it is a liability which would be so covered if (b) the policy insured all persons , and the judgment is obtained against any person other than one who is insured by the policy The effect of the latter subsection is that an insurer who has issued a policy in respect of the use of a vehicle is liable on a judgment, even where it was obtained against a person such as the driver of the Micra in this case who was not insured to drive it. The statutory liability of the insurer to satisfy judgments is subject to an exception under section 152 where it is entitled to avoid the policy for non disclosure or misrepresentation and has obtained a declaration to that effect in proceedings begun within a prescribed time period. But the operation of section 152 is currently under review in the light of recent decisions of the Court of Justice of the European Union. Under section 145(2), the policy must have been issued by an authorised insurer. This means a member of the Motor Insurers Bureau: see sections 95(2) and 145(5). The Bureau has an important place in the statutory scheme for protecting the victims of road accidents in the United Kingdom. Following a recommendation of the Cassell Committee, which reported in 1937 (Cmnd 5528/1937), the Bureau was created in 1946 to manage a fund for compensating victims of uninsured motorists. It is a private company owned and funded by all insurers authorised to write motor business in the United Kingdom. It has entered into agreements with the Secretary of State to compensate third party victims of road accidents who fall through the compulsory insurance net even under the enlarged coverage provided by section 151(2)(b). This means victims suffering personal injury or property damage caused by (i) vehicles in respect of which no policy of insurance has been issued; and (ii) drivers who cannot be traced. These categories are covered by two agreements with the Secretary of State, the Uninsured Drivers Agreement and the Untraced Drivers Agreement respectively. The relevant agreement covering Ms Camerons case was the 2003 Untraced Drivers Agreement. It applied to persons suffering death, bodily injury or property damage arising out of the use of a motor vehicle in cases where it is not possible to identify the person who is or appears to be liable: see clause 4(d). The measure of indemnity under this agreement is not always total. Under clause 10, there is a limit to the Bureaus liability for legal costs; and under clause 8 the indemnity for property damage is subject to a modest excess (at the relevant time 300) and a maximum limit corresponding to the minimum level of compulsory insurance (at the relevant time 1,000,000). The Bureau assumes liability under the Uninsured Drivers Agreement in cases where the insurer has a defence under the provisions governing avoided policies in section 152. But under article 75 of the Bureaus articles of association, each insurer binds itself to meet the Bureaus liability to satisfy a judgment in favour of the third party in such cases. In 2017, there were 17,700 concluded applications to the Motor Insurers Bureau by victims of untraced drivers. It is a fundamental feature of the statutory scheme of compulsory insurance in the United Kingdom that it confers on the victim of a road accident no direct right against an insurer in respect of the underlying liability of the driver. The only direct right against the insurer is the right to require it to satisfy a judgment against the driver, once the latters liability has been established in legal proceedings. This reflects a number of features of motor insurance in the United Kingdom which originated well before the relevant European legislation bound the United Kingdom, and which differentiate it from many continental systems. In the first place, policies of motor insurance in the United Kingdom normally cover drivers rather than vehicles. Section 151(2)(b) of the Act (quoted above) produces a close but not complete approximation to the continental position. Secondly, the rule of English insurance law is that an insurer is liable to no one but its insured, even when the risks insured include liabilities owed by the insured to third parties. Subject to limited statutory exceptions, the third party has no direct right against the insurer. Thirdly, even the insured cannot claim against his liability insurer unless and until his liability has been ascertained in legal proceedings or by agreement or admission. The Untraced Drivers Agreement assumes that judgment cannot be obtained against the driver if he cannot be identified, and therefore that no liability will attach to the insurer in that case. This is why it is accepted as a liability of the Motor Insurance Bureau. On the present appeal, Ms Cameron seeks to challenge that assumption. Such a challenge is usually unnecessary. It is cheaper and quicker to claim against the Bureau. But for reasons which remain unclear, in spite of her counsels attempt to explain them, Ms Cameron has elected not to do that. The proceedings Ms Cameron initially sued Mr Hussain for damages. The proceedings were then amended to add a claim against Liverpool Victoria Insurance for a declaration that it would be liable to meet any judgment obtained against Mr Hussain. The insurer served a defence which denied liability on the ground that there was no right to obtain a judgment against Mr Hussain, because there was no evidence that he was the driver at the relevant time. Ms Camerons response was to apply in the Liverpool Civil and Family Court to amend her claim form and particulars of claim so as to substitute for Mr Hussain the person unknown driving vehicle registration number Y598 SPS who collided with vehicle registration number KG03 ZJZ on 26 May 2013. District Judge Wright dismissed that application and entered summary judgment for the insurer. Judge Parker dismissed Ms Camerons appeal. But a further appeal to the Court of Appeal was allowed by a majority (Gloster and Lloyd Jones LJJ, Sir Ross Cranston dissenting): [2018] 1 WLR 657. Gloster LJ delivered the leading judgment. She held that the policy of the legislation was to ensure that the third party victims of negligent drivers received compensation from insurers whenever a policy had been issued in respect of the vehicle, irrespective of who the driver was. In her judgment, the court had a discretion to permit an unknown person to be sued whenever justice required it. Justice required it when the driver could not be identified, because otherwise it would not be possible to obtain a judgment which the issuer of a policy in respect of the car would be bound to satisfy. The majority considered it to be irrelevant that Ms Cameron had an alternative right against the Motor Insurance Bureau. She had a right against the driver and, upon getting judgment against him, against the insurer. In principle she was entitled to choose between remedies. Sir Ross Cranston dissented. He agreed that there was a discretion, but he did not consider that justice required an action to be allowed against the unknown driver when compensation was available from the Motor Insurance Bureau. Accordingly, the Court of Appeal (i) gave Ms Cameron permission to amend the claim form so as to sue the driver under the above description; (ii) directed under CPR 6.15 that service on the insurer should constitute service on the driver and that further service on the driver should be dispensed with; and (iii) gave judgment against the driver, as described, recording in their order that the insurer accepted that it was liable to satisfy that judgment. Suing unnamed persons Before the Common Law Procedure Act 1852 abolished the practice, it was common to constitute actions for trespass with fictional parties, generally John (or Jane) Doe or Roe, in order to avoid the restrictions imposed on possession proceedings by the forms of action. Placeholders such as these were also occasionally named as parties where the identity of the real party was unknown, a practice which subsists in the United States and Canada. After the disappearance of this practice in England, the extent of any right to sue unnamed persons was governed by rules of court. The basic rule before 1999 was laid down by the Court of Appeal in 1926 in Friern Barnet Urban District Council v Adams [1927] 2 Ch 25. The Friern Barnet District Council had a statutory right to recover the cost of making up Alexandra Road from the proprietors of the adjoining lands, but in the days before registered title reached Friern Barnet it had no way of discovering who they were. It therefore began proceedings against a named individual who was not concerned and the owners of certain lands adjoining Alexandra Road, whose names and addresses are not known to the plaintiffs. The judge struck out these words and declined to order substituted service by affixing copies of the writ to posts on the relevant land. The Court of Appeal dismissed the appeal. They held that there was no power to issue a writ in this form because the prescribed form of writ required it to be directed to C D of, etc in the County of (p 30). When the Civil Procedure Rules were introduced in 1999, the function of prescribing the manner in which proceedings should be commenced was taken over by CPR Part 7. The general rule remains that proceedings may not be brought against unnamed parties. This is implicit in the limited exceptions contemplated by the Rules. CPR 8.2A provides that a practice direction may set out circumstances in which a claim form may be issued under this Part without naming a defendant. It is envisaged that permission will be required, but that the notice of application for permission need not be served on any other person. However, no such practice direction has been made. The only express provision made for proceedings against an unnamed defendant, other than representative actions, is CPR 55.3(4), which permits a claim for possession of property to be brought against trespassers whose names are unknown. This is the successor to RSC Order 113, which was introduced in order to provide a means of obtaining injunctions against unidentifiable squatters, following the decision of Stamp J in In re Wykeham Terrace, Brighton, Sussex, Ex p Territorial Auxiliary and Volunteer Reserve Association for the South East [1971] Ch 204, that they could not be sued if they could not be named. In addition, there are specific statutory exceptions to broadly the same effect, such as the exception for proceedings for an injunction to restrain any actual or apprehended breach of planning controls under section 187B of the Town and Country Planning Act 1990. Section 187B(3) provides that rules of court may provide for such an injunction to be issued against a person whose identity is unknown. The Rules are supplemented by a practice direction which deals with the administrative steps involved. CPR 7A PD4.1 provides that a claim form must be headed with the title of the proceedings, which should state, among other things, the full name of each party. English judges have allowed some exceptions. They have permitted representative actions where the representative can be named but some or all of the class cannot. They have allowed actions and orders against unnamed wrongdoers where some of the wrongdoers were known so they could be sued both personally and as representing their unidentified associates. This technique has been used, for example, in actions against copyright pirates: see EMI Records Ltd v Kudhail [1985] FSR 35. But the possibility of a much wider jurisdiction was first opened up by the decision of Sir Andrew Morritt V C in Bloomsbury Publishing Group Plc v News Group Newspapers Ltd [2003] 1 WLR 1633. The claimant in that case was the publisher of the Harry Potter novels. Copies of the latest book in the series had been stolen from the printers before publication and offered to the press by unnamed persons. An injunction was granted in proceedings against the person or persons who have offered the publishers of The Sun, the Daily Mail and the Daily Mirror newspapers a copy of the book Harry Potter and the Order of the Phoenix by J K Rowling or any part thereof and the person or persons who has or have physical possession of a copy of the said book or any part thereof without the consent of the claimants. The real object of the injunction was to deter newspapers minded to publish parts of the text, who would expose themselves to proceedings for contempt of court by dealing with the thieves with notice of the order. The Vice Chancellor held that the decision in Friern Barnet Urban District Council v Adams had no application under the Civil Procedure Rules; that the decision of Stamp J in In re Wykeham Terrace was wrong; and that the words should state in CPR 7A PD4.1 were not mandatory, but imported a discretion to depart from the practice in appropriate cases. In his view, a person could be sued by a description, provided that the description was sufficiently certain as to identify both those who are included and those who are not (para 21). Since this decision, the jurisdiction has regularly been invoked. Judging by the reported cases, there has recently been a significant increase in its use. The main contexts for its exercise have been abuse of the internet, that powerful tool for anonymous wrongdoing; and trespasses and other torts committed by protesters, demonstrators and paparazzi. Cases in the former context include Brett Wilson LLP v Persons Unknown [2016] 4 WLR 69 and Smith v Unknown Defendant Pseudonym Likeicare [2016] EWHC 1775 (QB) (defamation); Middleton v Person Unknown [2016] EWHC 2354 (QB) (theft of information by hackers); PML v Persons Unknown [2018] EWHC 703 (QB) (hacking and blackmail); CMOC v Persons Unknown [2017] EWHC 3599 (Comm) (hacking and theft of funds). Cases decided in the second context include Hampshire Waste Services Ltd v Intending Trespassers upon Chineham Incinerator Site [2004] Env LR 9; Ineos Upstream Ltd v Persons Unknown [2017] EWHC 2945 (Ch); UK Oil and Gas Investments Plc v Persons Unknown [2018] EWHC 2253 (Ch). In some of these cases, proceedings against persons unknown were allowed in support of an application for a quia timet injunction, where the defendants could be identified only as those persons who might in future commit the relevant acts. The majority of the Court of Appeal followed this body of case law in deciding that an action was permissible against the unknown driver of the Micra who injured Ms Cameron. This is the first occasion on which the basis and extent of the jurisdiction has been considered by the Supreme Court or the House of Lords. The Civil Procedure Rules neither expressly authorise nor expressly prohibit exceptions to the general rule that actions against unnamed parties are permissible only against trespassers. The prescribed forms include a space in which to designate the claimant and the defendant, a format which is equally consistent with their being designated by name or by description. The only requirement for a name is contained in a practice direction. But unlike the Civil Procedure Rules, which are made under statutory powers, a practice direction is no more than guidance on matters of practice issued under the authority of the heads of division. As to those matters, it is binding on judges sitting in the jurisdiction with which it is concerned: Bovale Ltd v Secretary of State for Communities and Local Government [2009] 1 WLR 2274. But it has no statutory force, and cannot alter the general law. Whether or not the requirement of CPR 7A PD4.1 that the claim form should state the defendants full name admits of a discretion on the point, is not therefore the critical question. The critical question is what, as a matter of law, is the basis of the courts jurisdiction over parties, and in what (if any) circumstances can jurisdiction be exercised on that basis against persons who cannot be named. In approaching this question, it is necessary to distinguish between two kinds of case in which the defendant cannot be named, to which different considerations apply. The first category comprises anonymous defendants who are identifiable but whose names are unknown. Squatters occupying a property are, for example, identifiable by their location, although they cannot be named. The second category comprises defendants, such as most hit and run drivers, who are not only anonymous but cannot even be identified. The distinction is that in the first category the defendant is described in a way that makes it possible in principle to locate or communicate with him and to know without further inquiry whether he is the same as the person described in the claim form, whereas in the second category it is not. This appeal is primarily concerned with the issue or amendment of the claim form. It is not directly concerned with its service, which occurs under the rules up to four months after issue, subject to extension by order of the court. There is no doubt that a claim form may be issued against a named defendant, although it is not yet known where or how or indeed whether he can in practice be served. But the legitimacy of issuing or amending a claim form so as to sue an unnamed defendant can properly be tested by asking whether it is conceptually (not just practically) possible to serve it. The court generally acts in personam. Although an action is completely constituted on the issue of the claim form, for example for the purpose of stopping the running of a limitation period, the general rule is that service of originating process is the act by which the defendant is subjected to the courts jurisdiction: Barton v Wright Hassall LLP [2018] 1 WLR 1119, para 8. The court may grant interim relief before the proceedings have been served or even issued, but that is an emergency jurisdiction which is both provisional and strictly conditional. In Dresser UK Ltd v Falcongate Freight Management Ltd [1992] QB 502, the Court of Appeal held that, for the purposes of the Brussels Convention (the relevant provisions of the Brussels Regulation are different), an English court was seised of an action when the writ was served, not when it was issued. This was because of the legal status of an unserved writ in English law. Bingham LJ described that status, at p 523, as follows: it is in my judgment artificial, far fetched and wrong to hold that the English court is seised of proceedings, or that proceedings are decisively, conclusively, finally or definitively pending before it, upon mere issue of proceedings, when at that stage (1) the courts involvement has been confined to a ministerial act by a relatively junior administrative officer; (2) the plaintiff has an unfettered choice whether to pursue the action and serve the proceedings or not, being in breach of no rule or obligation if he chooses to let the writ expire unserved; (3) the plaintiffs claim may be framed in terms of the utmost generality; (4) the defendant is usually unaware of the issue of proceedings and, if unaware, is unable to call on the plaintiff to serve the writ or discontinue the action and unable to rely on the commencement of the action as a lis alibi pendens if proceedings are begun elsewhere; (5) the defendant is not obliged to respond to the plaintiffs claim in any way, and not entitled to do so save by calling on the plaintiff to serve or discontinue; (6) the court cannot exercise any powers which, on appropriate facts, it could not have exercised before issue; (7) the defendant has not become subject to the jurisdiction of the court. The case was decided under the Rules of the Supreme Court. But Bingham LJs statement would be equally true (mechanics and terminology apart) of an unserved claim form under the Civil Procedure Rules. An identifiable but anonymous defendant can be served with the claim form or other originating process, if necessary by alternative service under CPR 6.15. This is because it is possible to locate or communicate with the defendant and to identify him as the person described in the claim form. Thus, in proceedings against anonymous trespassers under CPR 55.3(4), service must be effected in accordance with CPR 55.6 by attaching copies of the documents to the main door or placing them in some other prominent place on the land where the trespassers are to be found, and posting them if practical through the letter box. In Brett Wilson LLP v Persons Unknown, supra, alternative service was effected by email to a website which had published defamatory matter, Warby J observing (para 11) that the relevant procedural safeguards must of course be applied. In Smith v Unknown Defendant Pseudonym Likeicare, supra, Green J made the same observation (para 11) in another case of internet defamation where service was effected in the same way. Where an interim injunction is granted and can be specifically enforced against some property or by notice to third parties who would necessarily be involved in any contempt, the process of enforcing it will sometimes be enough to bring the proceedings to the defendants attention. In Bloomsbury Publishing Group, for example, the unnamed defendants would have had to identify themselves as the persons in physical possession of copies of the book if they had sought to do the prohibited act, namely disclose it to people (such as newspapers) who had been notified of the injunction. The Court of Appeal has held that where proceedings were brought against unnamed persons and interim relief was granted to restrain specified acts, a person became both a defendant and a person to whom the injunction was addressed by doing one of those acts: South Cambridgeshire District Council v Gammell [2006] 1 WLR 658, para 32. In the case of anonymous but identifiable defendants, these procedures for service are now well established, and there is no reason to doubt their juridical basis. One does not, however, identify an unknown person simply by referring to something that he has done in the past. The person unknown driving vehicle registration number Y598 SPS who collided with vehicle registration number KG03 ZJZ on 26 May 2013, does not identify anyone. It does not enable one to know whether any particular person is the one referred to. Nor is there any specific interim relief such as an injunction which can be enforced in a way that will bring the proceedings to his attention. The impossibility of service in such a case is due not just to the fact that the defendant cannot be found but to the fact that it is not known who the defendant is. The problem is conceptual, and not just practical. It is true that the publicity attending the proceedings may sometimes make it possible to speculate that the wrongdoer knows about them. But service is an act of the court, or of the claimant acting under rules of court. It cannot be enough that the wrongdoer himself knows who he is. This is, in my view, a more serious problem than the courts, in their more recent decisions, have recognised. Justice in legal proceedings must be available to both sides. It is a fundamental principle of justice that a person cannot be made subject to the jurisdiction of the court without having such notice of the proceedings as will enable him to be heard. The principle is perhaps self evident. The clearest statements are to be found in the case law about the enforcement of foreign judgments at common law. The English courts will not enforce or recognise a foreign judgment, even if it has been given by a court of competent jurisdiction, if the judgment debtor had no sufficient notice of the proceedings. The reason is that such a judgment will have been obtained in breach of the rules of natural justice according to English notions. In his celebrated judgment in Jacobson v Frachon (1927) 138 LT 386, 392, Atkin LJ, after referring to the principles of natural justice put the point in this way: Those principles seem to me to involve this, first of all that the court being a court of competent jurisdiction, has given notice to the litigant that they are about to proceed to determine the rights between him and the other litigant; the other is that having given him that notice, it does afford him an opportunity of substantially presenting his case before the court. Lord Atkins principle is reflected in the statutory provisions for the recognition of foreign judgments in section 9(2)(c) of the Administration of Justice Act 1920 and section 8(1) and (2) of the Foreign Judgments (Reciprocal Enforcement) Act 1933, as well as in article 45(1)(b) of the Brussels I Regulation (Recast), Regulation (EU) No 1215/2012. It would be ironic if the English courts were to disregard in their own proceedings a principle which they regard as fundamental to natural justice as applied to the proceedings of others. In fact, the principle is equally central to domestic litigation procedure. Service of originating process was required by the practice of the common law courts long before statutory rules of procedure were introduced following the Judicature Acts of 1873 and 1875. The first edition of the Rules of the Supreme Court, which was promulgated in 1883, required personal service unless an order was made for what was then called substituted (now alternative) service. Subsequent editions of the rules allowed for certain other modes of service without a special order of the court, notably in the case of corporations, but every mode of service had the common object of bringing the proceedings to the attention of the defendant. In Porter v Freudenberg [1915] 1 KB 857 a specially constituted Court of Appeal, comprising the Lord Chief Justice, the Master of the Rolls and all five Lords Justices of the time, held that substituted service served the same function as personal service and therefore had to be such as could be expected to bring the proceedings to the defendants attention. The defendants in that case were enemy aliens resident in Germany during the First World War. Lord Reading CJ, delivering the judgment of the court, said at p 883: Once the conclusion is reached that the alien enemy can be sued, it follows that he can appear and be heard in his defence and may take all such steps as may be deemed necessary for the proper presentment of his defence. If he is brought at the suit of a party before a court of justice he must have the right of submitting his answer to the court. To deny him that right would be to deny him justice and would be quite contrary to the basic principles guiding the Kings courts in the administration of justice. It followed, as he went on to observe at pp 887 888, that the court must take into account the position of the defendant the alien enemy, who is, according to the fundamental principles of English law, entitled to effective notice of the proceedings against him. In order that substituted service may be permitted, it must be clearly shown that the plaintiff is in fact unable to effect personal service and that the writ is likely to reach the defendant or to come to his knowledge if the method of substituted service which is asked for by the plaintiff is adopted. The principle stated in Porter v Freudenberg was incorporated in the Rules of the Supreme Court in the revision of 1962 as RSC Order 67, rule 4(3). This provided: Substituted service of a document, in relation to which an order is made under this rule, is effected by taking such steps as the court may direct to bring the document to the notice of the person to be served. This provision subsequently became RSC Order 65, rule 4(3), and continued to appear in subsequent iterations of the Rules until they were superseded by the Civil Procedure Rules in 1999. The treatment of the principle in the more recent authorities is, unfortunately, neither consistent nor satisfactory. The history may be summarised as follows: (1) Murfin v Ashbridge [1941] 1 All ER 231 arose out of a road accident caused by the alleged negligence of a driver who was identified but could not be found. The case is authority for the proposition that while an insurer may be authorised by the policy to defend an action on behalf of his assured, he was not a party in that capacity and could not take any step in his own name. In the course of considering that point, Goddard LJ suggested at p 235 that possibly service on the driver might have been effected by substituted service on the insurers. Porter v Freudenberg was cited, but the point does not appear to have been argued. (2) In Gurtner v Circuit [1968] 2 QB 587, the driver alleged to have been responsible for a road accident had emigrated and could not be traced. He was thought to have been insured, but it was impossible to identify his insurer. The plaintiff was held not to be entitled to an order for substituted service on another insurer who had no relationship with the driver. Lord Denning MR thought (pp 596 597) that the affidavit in support of the application was defective because it failed to state that the writ, if served on a non insurer, was likely to reach the defendant. But he suggested that substituted service might have been effected on the real insurer if it had been identified. Diplock LJ thought (p 605) that it might have been effected on the Motor Insurers Bureau. Porter v Freudenberg was not cited, and the point does not appear to have been argued. In Clarke v Vedel [1979] RTR 26, the question was fully argued by (3) reference to all the relevant authorities in the context of the Road Traffic Acts. A person had stolen a motor cycle, collided with the plaintiffs, given a fictitious name and address and then disappeared. He was sued under the fictitious name he had given, and an application was made for substituted service on the Motor Insurance Bureau. The affidavit in support understandably failed to state that that mode of service could be expected to reach the driver. The Court of Appeal proceeded on the assumption (p 32) that there was no more reason to suppose that [the writ] will come to his notice or knowledge by being served on the Motor Insurance Bureau than by being served on any one else in the wide world. But it declined to treat the dicta in the above cases as stating the law. Stephenson LJ considered (p 36), on the strength of the dicta in Murfin v Ashbridge and Gurtner v Circuit, that there may be cases where a defendant, who cannot be traced and, therefore, is unlikely to be reached by any form of substituted service, can nevertheless be ordered to be served at the address of insurers or the Bureau in a road accident case. The existence of insurers and of the Bureau and of these various agreements does create a special position which enables a plaintiff to avoid the strictness of the general rule and obtain such an order for substituted service in some cases. But he held (p 37) that This is a case in which, on the face of it, substituted service under the rule is not permissible and the affidavit supporting the application for it is insufficient. This fictitious, or, at any rate, partly fictitious defendant cannot be served, so Mr Crowther is right in saying that he cannot be sued I do not think that Lord Denning MR or Diplock LJ or Salmon LJ or Goddard LJ had anything like the facts of this case in mind; and whatever the cases in which the exception to the general rule should be applied, in my judgment this is not one of them. In his concurring judgment, Roskill LJ (pp 38 39) approved the statement in the then current edition of the Supreme Court Practice that [t]he steps which the court may direct in making an order for substituted service must be taken to bring the document to the notice of the person to be served, citing Porter v Freudenberg in support of it. (4) 20 years later, another division of the Court of Appeal reached the opposite conclusion in Abbey National Plc v Frost (Solicitors Indemnity Fund Ltd intervening) [1999] 1 WLR 1080. The issue was the same, except that the defendant was a solicitor insured by the Solicitors Indemnity Fund pursuant to a scheme managed by the Law Society under the compulsory insurance provisions of the Solicitors Act 1974. The claimant sued his solicitor, who had absconded and could not be found. The Court of Appeal made an order for substituted service on the Fund. Nourse LJ (with whom Henry LJ and Robert Walker LJ agreed) distinguished Porter v Freudenberg on the ground that it was based on the practice of the masters of the Supreme Court recorded in the White Book at the time; and Clarke v Vedel on the ground that the policy of the statutory solicitors indemnity rules required a right of substituted service on an absconding solicitor. RSC Order 65, rule 4(3) was held to be purely directory and not to limit the discretion of the court as to whether or in what circumstances to order substituted service. Nourse LJ held that RSC Order 65 did not require that the order should be likely to result in the proceedings coming to the defendants attention. The current position is set out in Part 6 of the Civil Procedure Rules. CPR 6.3 provides for service by the court unless the claimant elects to effect service himself. It considerably broadens the permissible modes of service along lines recommended by Lord Woolfs reports on civil justice. But the object of all the permitted modes of service, as his final report made clear, was the same, namely to enable the court to be satisfied that the method used either had put the recipient in a position to ascertain its contents or was reasonably likely to enable him to do so within any relevant time period: see Access to Justice, Final Report (1996), Ch 12, para 25. CPR 6.15, which makes provision for alternative service, provides, so far as relevant: 6.15(1) Where it appears to the court that there is a good reason to authorise service by a method or at a place not otherwise permitted by this Part, the court may make an order permitting service by an alternative method or at an alternative place. (2) On an application under this rule, the court may order that steps already taken to bring the claim form to the attention of the defendant by an alternative method or at an alternative place is good service. CPR 6.15 does not include the provision formerly at RSC Order 65, rule 4(3). But it treats alternative service as a mode of service, which is defined in the indicative glossary appended to the Civil Procedure Rules as steps required by rules of court to bring documents used in court proceedings to a persons attention. Moreover, sub paragraph (2) of the rule, which is in effect a form of retrospective alternative service, envisages in terms that the mode of service adopted will have had that effect. Applying CPR 6.15 in Abela v Baadarani [2013] 1 WLR 2043 Lord Clarke of Stone cum Ebony (with whom the rest of this court agreed) held (para 37) that the whole purpose of service is to inform the defendant of the contents of the claim form and the nature of the claimants case. The Court of Appeal appears to have had no regard to these principles in ordering alternative service of the insurer in the present case. In my opinion, subject to any statutory provision to the contrary, it is an essential requirement for any form of alternative service that the mode of service should be such as can reasonably be expected to bring the proceedings to the attention of the defendant. Porter v Freudenberg was not based on the niceties of practice in the masters corridor. It gave effect to a basic principle of natural justice which had been the foundation of English litigation procedure for centuries, and still is. So far as the Court of Appeal intended to state the law generally when it observed in Abbey National Plc v Frost that service need not be such as to bring the proceedings to the defendants attention, I consider that they were wrong. An alternative view of that case is that that observation was intended to apply only to claims under schemes such as the solicitors compulsory insurance scheme, where it was possible to discern a statutory policy that the public should be protected against defaulting solicitors. If so, the reasoning would apply equally to the compulsory insurance of motorists under the Road Traffic Acts, as indeed the Court of Appeal held in the present case. That would involve a narrower exception to the principle of natural justice to which I have referred, and I do not rule out the possibility that such an exception might be required by other statutory schemes. But I do not think that it can be justified in the case of the scheme presently before us. In the first place, the Road Traffic Act scheme is expressly based on the principle that as a general rule there is no direct liability on the insurer, except for its liability to meet a judgment against the motorist once it has been obtained. To that extent, Parliaments intention that the victims of negligent motorists should be compensated by the insurer is qualified. No doubt Parliament assumed, when qualifying it in this way, that other arrangements would be made which would fill the compensation gap, as indeed they have been. But those arrangements involve the provision of compensation not by the insurer but by the Motor Insurers Bureau. The availability of compensation from the Bureau makes it unnecessary to suppose that some way must be found of making the insurer liable for the underlying wrong when his liability is limited by statute to satisfying judgments. Secondly, ordinary service on the insurer would not constitute service on the driver, unless the insurer had contractual authority to accept service on the drivers behalf or to appoint solicitors to do so. Such provisions are common in liability policies. I am prepared to assume that the policy in this case conferred such authority on the insurer, although we have not been shown it. But it could only have conferred authority on behalf of the policy holder (if he existed), and it is agreed that the driver of the Micra was not the policy holder. Given its contingent liability under section 151 of the Road Traffic Act 1988, the insurer no doubt has a sufficient interest to have itself joined to the proceedings in its own right, if it wishes to be. That would authorise the insurer to make submissions in its own interest, including submissions to the effect that the driver was not liable. But it would not authorise it to conduct the defence on the drivers behalf. The driver, if sued in these proceedings, is entitled to be heard in his own right. Thirdly, it is plain that alternative service on the insurer could not be expected to reach the driver of the Micra. It would be tantamount to no service at all, and should not therefore have been ordered unless the circumstances were such that it would be appropriate to dispense with service altogether. There is a power under CPR 6.16 to dispense with service of a claim form in exceptional circumstances. It has been exercised on a number of occasions and considered on many more. In general, these have been cases in which the claimant has sought to invoke CPR 6.16 in order to escape the consequences of some procedural mishap in the course of attempting to serve the claim form by one of the specified methods, or to confer priority on the English court over another forum for the purpose of the Brussels Regulation, or to affect the operation of a relevant limitation period. In all of them, the defendant or his agents was in fact aware of the proceedings, generally because of a previous attempt by the claimant to serve them in a manner not authorised by the Rules. As Mummery LJ observed, delivering the judgment of the Court of Appeal in Anderton v Clwyd County Council (No 2) [2002] 1 WLR 3174, para 58, service was dispensed with because there was no point in requiring him to go through the motions of a second attempt to complete in law what he has already achieved in fact. In addition, I would accept that it may be appropriate to dispense with service, even where no attempt has been made to effect it in whatever manner, if the defendant has deliberately evaded service and cannot be reached by way of alternative service under CPR 6.15. This would include cases where the defendant is unidentifiable but has concealed his identity in order to evade service. However, a person cannot be said to evade service unless, at a minimum, he actually knows that proceedings have been or are likely to be brought against him. A court would have to be satisfied of that before it could dispense with service on that basis. An inference to that effect may be easier to draw in the case of hit and run drivers, because by statute drivers involved in road accidents causing personal injury or damage to another vehicle must either stop and, if required to do so by any person having reasonable grounds for so requiring, give his name and address and also the name and address of the owner and the identification marks of the vehicle, or else report the incident later. But the mere fact of breach of this duty will not necessarily be enough, for the driver may be unaware of his duty or of the personal injury or damage or of his potential liability. No submission was made to us that we should treat this as a case of evasion of service, and there are no findings which would enable us to do so. I would not wish arbitrarily to limit the discretion which CPR 6.16 confers on the court, but I find it hard to envisage any circumstances in which it could be right to dispense with service of the claim form in circumstances where there was no reason to believe that the defendant was aware that proceedings had been or were likely to be brought. That would expose him to a default judgment without having had the opportunity to be heard or otherwise to defend his interests. It is no answer to this difficulty to say that the defendant has no reason to care because the insurer is bound to satisfy a judgment against him. If, like the driver of the Micra, the motorist was not insured under the policy, he will be liable to indemnify the insurer under section 151(8) of the Road Traffic Act. It must be inherently improbable that he will ever be found or, if found, will be worth pursuing. But the court cannot deny him an opportunity to be heard simply because it thinks it inherently improbable that he would take advantage of it. I conclude that a person, such as the driver of the Micra in the present case, who is not just anonymous but cannot be identified with any particular person, cannot be sued under a pseudonym or description, unless the circumstances are such that the service of the claim form can be effected or properly dispensed with. The European law issue Mr Williams QC, who appeared for Ms Cameron, submitted that this result was inconsistent with the Sixth Motor Insurance Directive 2009/103/EC, and that the Road Traffic Act 1988 should be read down so as to conform with it. The submission was pressed with much elaboration, but it really boils down to two points. First, Mr Williams submits that the Directive requires a direct right against the insurer on the drivers underlying liability, and not simply a requirement to have the insurer satisfy a judgment against the driver. Secondly, he submits that recourse to the Motor Insurers Bureau is not treated by the Directive as an adequate substitute. Neither point appears to have been raised before the Court of Appeal, for there is no trace of them in the judgments. Before us, they emerged as Mr Williams main arguments. I propose, however, to deal with them quite shortly, because I think it clear that no point on the Directive arises. Article 3 of the Directive requires member states to ensure that civil liability in respect of the use of vehicles is covered by insurance, and article 9 lays down minimum amounts to be insured. Recital 30 states: The right to invoke the insurance contract and to claim against the insurance undertaking directly is of great importance for the protection of victims of motor vehicle accidents In order to facilitate an efficient and speedy settlement of claims and to avoid as far as possible costly legal proceedings, a right of direct action against the insurance undertaking covering the person responsible against civil liability should be extended to victims of any motor vehicle accident. Effect is given to this objective by article 18, which provides: Article 18 Direct Right of Action Member states shall ensure that any party injured as a result of an accident caused by a vehicle covered by insurance as referred to in article 3 enjoys a direct right of action against the insurance undertaking covering the person responsible against civil liability. I assume (without deciding) that article 18 requires a direct right of action against the insurer in respect of the underlying wrong of the person responsible and not just a liability to satisfy judgments entered against that person. It is a plausible construction in the light of the recital and the reference to Directive 2000/26/EC. However, Ms Cameron is not trying in these proceedings to assert a direct right against the insurer for the underlying wrong. Her claim against the insurer is for a declaration that it is liable to meet any judgment against the driver of the Micra. Her claim against the driver is for damages. But the right that she asserts against him on this appeal is a right to sue him without identifying him or observing rules of court designed to ensure that he is aware of the proceedings. Nothing in the Directive requires the United Kingdom to recognise a right of that kind. Indeed, it is questionable whether it would be consistent with article 47 of the Charter of Fundamental Rights regarding the fairness of legal proceedings. Mr Williams second point is in reality a reiteration of the first. It is based on article 10 of the Directive, which requires member states to ensure that there is a national bureau charged to pay compensation for damage to property or personal injuries caused by an unidentified vehicle or a vehicle for which the insurance obligation provided for in article 3 has not been satisfied. The submission is that the Directive requires that recourse to the Bureau, as the relevant body in the United Kingdom, should be unnecessary in a case like this, because the Micra was identified. It was only the driver who was unidentified. This is in effect a complaint that the indemnity available from the Motor Insurers Bureau under the Untraced Drivers Agreement, which extends to untraced drivers whether or not the vehicle is identified, is wider than the Directive requires. In reality, the complaint is not about the extent of the Bureaus coverage, which unquestionably extends to this case. The complaint is that it is the Bureau which is involved and not the insurer. But that is because the insurer is liable only to satisfy judgments, which is Mr Williams first point. It is true that the measure of the Bureaus indemnity is slightly smaller than that of the insurer (because of the excess for property damage and the limited provision for costs). But in that respect it is consistent with the Directive. Disposal I would allow the appeal, set aside the order of the Court of Appeal, and reinstate that of District Judge Wright.

On 26 May 2013, the respondent, Ms Bianca Cameron, was injured when her car collided with a Nissan Micra. It is not in dispute that the incident was due to the negligence of the driver of the Micra. The registration number of the Micra was recorded, but the driver made off without stopping or reporting the accident to the police and has not been heard of since. Mr Naveed Hussain, the registered keeper, was not the driver and has declined to identify the driver. He has been convicted of failing to disclose the drivers identity. The car was insured under a policy issued by the appellant, Liverpool Victoria Insurance Co Ltd, to a Mr Nissar Bahadur, whom the company believes to be a fictitious person. Neither Mr Hussain nor the driver was insured under the policy to drive the car. Ms Cameron initially sued Mr Hussain for damages. The proceedings were amended to add a claim against Liverpool Victoria Insurance for a declaration that it would be liable to meet any judgment against him. The insurer served a defence, denying liability on the ground that there was no right to obtain a judgment against him as there was no evidence that he was the driver. Ms Cameron then applied to amend her claim form and particulars of claim. She sought to substitute for Mr Hussain, as defendant, the person unknown driving vehicle registration number Y598 SPS who collided with vehicle registration number KG03 ZJZ on 26 May 2013. District Judge Wright dismissed that application and entered summary judgment for the insurer. HHJ Parker dismissed Ms Camerons appeal. On further appeal, the Court of Appeal allowed the appeal by a majority (Gloster and Lloyd Jones LJJ, Sir Ross Cranston dissenting). The majority considered that the court had a discretion to permit an unknown person to be sued whenever justice required it and that an alternative right of claim against the Motor Insurance Bureau (MIB) was irrelevant. Sir Ross Cranston would have dismissed the appeal in light of the alternative right to an MIB claim. Liverpool Victoria Insurance appealed to the Supreme Court in relation to two issues: (1) the power to issue or amend the claim form and (2) the compatibility of the Road Traffic Act 1988 (the 1988 Act) with the Sixth Motor Insurance Directive (2009/103/EC). The Supreme Court allows the appeal. The Court of Appeals order is set aside and that of District Judge Wright is reinstated. Lord Sumption gives the lead judgment, with which all the Justices agree. Part VI of the Road Traffic Act 1988 applies in this appeal. Section 145 requires there to be an insurance policy against third party risks in relation to the use of the vehicle by the particular driver, while section 151(5) requires the insurer to satisfy any judgment falling within section 151(2), subject to certain conditions. Under section 151(2)(b), an insurer who has issued a policy in relation to the use of a vehicle is liable on a judgment, even where it was obtained against an uninsured driver. [3] The MIB has entered into agreements with the Secretary of State to compensate third party victims of road accidents not even covered by section 151(2)(b). This means victims suffering personal injury or property damage caused by (1) uninsured vehicles and (2) drivers who cannot be traced. Clause 4(d) of the 2003 Untraced Drivers Agreement (the 2003 Agreement) is applicable in Ms Camerons case. [4] It is a fundamental feature of the statutory scheme of compulsory insurance in the UK that it does not confer on victims a direct right of recovery against an insurer for the underlying liability of the driver. The only direct right against the insurer is the right to require it to satisfy a judgment against the driver, under section 151, once the drivers liability has been established in legal proceedings. Consistent with this approach, the 2003 Agreement assumes that judgment cannot be obtained against the driver if he cannot be identified, and therefore the only recourse is against the MIB, not the insurer. [5, 22] The general rule remains that proceedings may not be brought against unnamed parties, as is implicit in the limited exceptions contemplated by the Civil Procedure Rules (CPR) [9]. The main exceptions are: (1) possession actions against trespassers, (2) actions and orders where some of the wrongdoers were known so they could be sued both personally and as representing their unidentified associates and (3) the wider jurisdiction recognised in Bloomsbury Publishing Group Plc v News Group Newspapers Ltd [2003] 1 WLR 1633 (Ch) [10]. The key distinction is between two classes of unnamed defendant cases: (1) anonymous defendants who are identifiable but whose names are unknown and (2) defendants, such as in most hit and run drivers, who are not only anonymous but cannot even be identified. In category (1), defendants are described in such a way that it is at least possible to locate or communicate with them, and to determine whether they are the person described in the claim form. In category (2), this is not possible. [13] This appeal is not directly concerned with service it is about the issue or amendment of the claim form but the legitimacy of issuing or amending can be tested against the possibility of service [14]. An identifiable but anonymous defendant can be served, if necessary by CPR r.6.15 alternative service [15]. Interim injunction cases can fall in category (1), because the process of enforcing the injunction will sometimes be enough to bring the proceedings to the defendants attention, as in Bloomsbury [15]. However, an unknown person is not identified simply by referring to past actions [16]. Proceedings against such a person (in category (2)) offend the fundamental principle of justice that a person cannot be made subject to the jurisdiction of the court without having such notice of the proceedings as will enable a fair hearing [17 18]. While CPR r.6.15 permits alternative service, the mode of service should be such as can reasonably be expected to bring the proceedings to the defendants attention [20 21]. Applying these principles to the present appeal, alternative service against an unidentifiable person referred to in the proceedings only by a pseudonym or description cannot be justified. In particular, ordinary service on the insurer would not constitute service on the driver, and alternative service could not be expected to reach the driver of the Micra. Nor would it be appropriate to dispense with service under CPR r.6.16 in a case where it could not be shown that the defendant knew of the proceedings. [21 26] As to the EU law issue on the Sixth Motor Insurance Directive, the Supreme Court considers no point on the Directive arises because: (1) Ms Cameron is not trying to assert a direct right against the insurer for the underlying wrong (her claim is for damages from the driver) and (2) it is consistent with the Directive to require a claim against the MIB, not the insurer, in this class of case [27 30].

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This appeal raises an issue as to the applicability of the equitable doctrine of marshalling. Lord Hoffmann explained the doctrine in characteristically pithy terms in In re Bank of Credit and Commerce International SA (No 8) [1998] AC 214, 230 231 as: [A] principle for doing equity between two or more creditors, each of whom are owed debts by the same debtor, but one of whom can enforce his claim against more than one security or fund and the other can resort to only one. It gives the latter an equity to require that the first creditor satisfy himself (or be treated as having satisfied himself) so far as possible out of the security or fund to which the latter has no claim. It is perhaps also worth setting out how Rose LJ explained the doctrine in the same case in the Court of Appeal [1996] Ch 245, 271: The doctrine of marshalling applies where there are two creditors of the same debtor, each owed a different debt, one creditor (A) having two or more securities for the debt due to him and the other (B) having only one. B has the right to have the two securities marshalled so that both he and A are paid so far as possible. Thus if a debtor has two estates (Blackacre and Whiteacre) and mortgages both to A and afterwards mortgages Whiteacre only to B, B can have the two mortgages marshalled so that Blackacre can be made available to him if A chooses to enforce his security against Whiteacre. For the doctrine to apply there must be two debts owed by the same debtor to two different creditors. The question in the present case is whether it is open to the respondent, the Serious Organised Crime Agency (SOCA), to invoke the doctrine so as to marshal a charge granted to the Royal Bank of Scotland (RBS) over the home of Mrs Szepietowski and an investment property she owned, with a later charge granted to SOCA over the investment property alone, thereby enabling SOCA to look to Mrs Szepietowskis home to satisfy the sum secured by the second charge. (Pursuant to the Crime and Courts Act 2013, SOCA was replaced by the National Crime Agency with effect from 7 October 2013, but it is more convenient to retain the nomenclature used in the parties argument and most of the documentation in these proceedings). The facts giving rise to the issue The Settlement Deed In 1999, Mr Szepietowski was one of two partners in a firm of solicitors which received a transfer of some US $2.5m which was alleged to represent the proceeds of drug trafficking (although it is right to record that neither Mr Szepietowski nor his wife has ever been charged with any offence, and they both deny any wrongdoing). In July 2005, the Assets Recovery Agency (ARA, whose staff, assets and functions were transferred to SOCA in March 2008 pursuant to the Serious Crime Act 2007) obtained an interim receiving order over certain assets acquired with the US $2.5m. Three months later, the receiving order was extended to a number of other properties, which had allegedly been acquired with proceeds of mortgage fraud and with income concealed from Her Majestys Revenue and Customs (HMRC). In November 2006, the ARA began civil proceedings against Mr and Mrs Szepietowski seeking to confiscate the various properties on the basis that the proceeds of crime could be followed into them, and they accordingly constituted recoverable property within the meaning of section 266 of the Proceeds of Crime Act 2002 (the 2002 Act). There were 20 properties in total, and they included (i) Ashford House, Weybridge (Ashford House), which was Mr and Mrs Szepietowskis home, (ii) 2 and 2a Thames Street, Walton on Thames (Thames Street), (iii) 3 and 5 Church Street, Esher (Church Street), (iv) 2, 4, and 6 Torrington Close, Claygate, and (v) 109 Hare Lane, Claygate (together Claygate). All these five properties were registered in the name of Mrs Szepietowski, and each of them was subject to an all monies charge in favour of RBS. The parties have treated RBS as having a single charge over the five properties (the RBS Charge), and I will do the same. Mr and Mrs Szepietowski and the ARA settled the proceedings on terms contained in a consent order dated 16 January 2008, which stayed the ARAs claim save for the purpose of enforcing the terms of settlement. Those terms were contained in documents attached to the consent order. Most of the terms were in a Deed of Settlement (the Settlement Deed) dated 15 January 2008, which included a schedule which had three annexes. Annexe A listed the 20 properties, and recorded the secured creditor of, the value of, the amount charged on, and the equity in, each property. Annexe B listed 13, and Annexe C a further two, of those 20 properties, with identical details plus the identity of the registered proprietor. (The figures in the Annexes were in fact somewhat historic, but nothing hangs on that for present purposes). The general scheme of the arrangement embodied in the Settlement Deed was that the 13 properties in Annexe B were vested in the Trustee for Civil Recovery (the Trustee) on behalf of the ARA, the Trustee was also to have the two properties in Annexe C vested in him, and the balance of the properties in Annexe A were to remain with their registered proprietors free of the receiving order. Any property so vested or retained was to be subject to any existing charges. Clause 2.1 of the Settlement Deed provided that it was made in full and final settlement of all of the [ARAs] claims against Mr and Mrs Szepietowski in relation to the properties and the other assets listed in Annexe A and in relation to their tax liabilities. One of the properties listed in Annexe A (but not in Annexe B or C) was Ashford House, which was accordingly to revert to Mrs Szepietowski free of the receiving order. In Annexe A, Ashford House was recorded as having a value of 2.3m, and charged to The Mortgage Business plc (TMB) and RBS for about 1.46m, but it is clear that this was only the amount outstanding to TMB. Ashford House was not in Annexe B or C. By clause 3.1 of the Settlement Deed, Mr and Mrs Szepietowski agreed to vest in the Trustee the 13 Transfer Properties listed in Annexe B, and the two Additional Properties listed in Annexe C. The Transfer Properties included Thames Street and Church Street. They were recorded as valued at 570,000 and 785,000 respectively, and (together with the Additional Properties) as (i) charged to RBS for a debt of about 3.225m and (ii) having equity of about 1.6m. Annexe C contained the two Claygate properties, at Torrington Close and Hare Lane, which were recorded as valued at 2.67m and 800,000 respectively, and, together with Thames Street and Church Street, as charged to RBS for a debt of about 3.225m, and having equity of about 1.6m. The valuations of the Additional Properties, ie of Claygate, in Annexe C suggested that the liability to RBS could be fully met from their sale, and indeed the parties anticipated that the ARA would, in effect, be able to realise the Transfer Properties free of any liability to RBS. They recorded at the end of Annexe B that this would have enabled the ARA to recover just over 5.4m from the sale of the Transfer Properties after clearing all mortgages thereon. At the time of the settlement, Mrs Szepietowski was negotiating to sell the Additional, Claygate, Properties, and clauses 4.1 4.3 of the Settlement Deed enabled and required her to proceed with the proposed sale. If she had not bindingly agreed to dispose of Claygate within six months, then, by clause 4.4, she had to elect whether Claygate should remain vested in the Trustee, who would be free to dispose of them, or be transferred to her by the Trustee. Clause 4.5 of the Settlement Deed is of some importance for present purposes, and it was in these terms (with paragraphs added for convenience): (i) If the Trustee wishes to sell [Thames Street and Church Street] (the Remaining RBS properties) before the Additional [Claygate] Properties are sold then [Mr and Mrs Szepietowski] agree that, if [RBS] consent, the [RBS Charge] over these properties and the Additional Properties in favour of [RBS] shall be transferred to the Additional Properties only. (ii) If [RBS] does not so consent then [Mrs] Szepietowski will grant a charge to the Trustee for the sums paid by the Trustee to [RBS] from the sale proceeds of the Remaining RBS properties. Clause 4.6 of the Settlement Deed contained an agreement that the total funds from the sale of the Additional Properties [would] be used in priority to the funds from the sale of the Remaining RBS Properties [ie Thames Street and Church Street] in satisfaction of the [RBS] Charge. Clause 4.7 provided that, on the sale of Claygate, the proceeds would be used to pay off what was owing under the RBS Charge insofar as it was registered against those properties, and any balance would be fully accounted for by the Trustee to [Mrs] Szepietowski without deduction or set off. The Settlement Deed contained a number of other provisions (including, in clause 13.4 an obligation on Mr and Mrs Szepietowski each to pay HMRC 687,500 in respect of back tax and national insurance payments in respect of the 14 tax years ending 2006/2007), but it is unnecessary to refer to them for present purposes. Subsequent events Towards the end of January 2008, Church Street, Thames Street and Claygate were duly vested in the Trustee, subject to the RBS Charge. However, the sale of Claygate did not proceed as anticipated. The Trustee implemented clause 4.5(i) of the Settlement Deed, and marketed Church Street and Thames Street, which were sold in April 2008 for 715,000 and 560,000 respectively. RBS declined to release them from the RBS charge, and consequently the proceeds of sale were paid over to RBS. It was becoming clear that the sum likely to be realised on the sale of Claygate (when added to the proceeds of sale of Church Street and Thames Street) would scarcely be sufficient to clear the RBS Charge. This state of affairs was in marked contrast to the common expectation of the parties at the time of the settlement, when they had anticipated that the proceeds of sale of Claygate alone (estimated in Annexes A and C to be worth around 3.54m) would be sufficient to clear the debt to RBS (recorded in the Annexes as being about 3.225m). A dispute then arose as to the properties over which Mrs Szepietowski was obliged to grant SOCA (who had by now replaced the ARA and the Trustee) a charge pursuant to clause 4.5(ii) of the Settlement Deed. In March 2009, Henderson J decided that the charge was to be over Claygate as Mrs Szepietowski contended, and not over Ashford House as well, as SOCA argued: [2009] EWHC 655 (Ch). At that hearing, Mrs Szepietowski made it clear that she wished Claygate to be vested in her pursuant to her obligation to elect in clause 4.4 of the Settlement Deed see para 35 of the judgment. Accordingly, as he recorded in the following paragraph, Henderson J ordered that Claygate be re transferred by the Trustee to Mrs Szepietowski, and that she grant a charge over them to SOCA. Claygate was duly revested in Mrs Szepietowski on 4 September 2009, and on the same day she granted a charge over Claygate to SOCA (the 2009 Charge). Clause 1 of the 2009 Charge was concerned with interpretation, and included a definition of Secured Amount as being just over 1.24m, together with any sums due to SOCA under its terms. The figure of 1.24m was equal to the net proceeds of sale of Thames Street and Church Street, which had been paid in full to RBS under the RBS Charge, but which SOCA and the Szepietowskis had hoped would be paid to SOCA under clause 4.5(i) of the Settlement Deed. Clause 2 of the 2009 Charge was headed Covenants, and clause 2.1 was a covenant by Mrs Szepietowski that on completion of any sale of the Charged Property effected by her, after paying the costs of sale, she would apply the proceeds of sale in settlement of the Secured Amount. Clause 2 also contained provisions which sought to ensure that any such sale would be effected at the best price. Clause 3 of the 2009 Charge was headed Charges, and, under it, Mrs Szepietowski charged the Charged Property and the proceeds of sale thereof by way of legal mortgage to SOCA as continuing security for the settlement of the Secured Amount. Clause 7.1 provided that the Secured Amount shall become due and the security conferred by this Charge will become immediately enforceable and the power of sale and other powers conferred by section 101 of the Law of Property Act 1925 will be immediately exercisable after four months or, if earlier, on any breach of the 2009 Charge by Mrs Szepietowski, or her death or insolvency. Clause 7.2 provided that for the avoidance of doubt, clause 7.1 did not constitute a covenant by [Mrs Szepietowski] to pay the Secured Amount to [SOCA]. Around December 2009, Mrs Szepietowski sold Claygate for a total of 2.33m, substantially less than had been anticipated two years earlier. The 2009 Charge was, of course, a second charge over Claygate, as it was still subject to the RBS Charge, and when the net proceeds of sale of Claygate were used to pay off RBS pursuant to the RBS charge, the relatively derisory figure of 1,324.16 was all that was left to satisfy SOCAs rights under the 2009 Charge. SOCAs marshalling claim The competing contentions SOCAs case is that the classic requirements of marshalling are satisfied in the present case in light of the facts that: i) ii) Claygate and Ashford House were both owned by Mrs Szepietowski, Claygate and Ashford House were both subject to the RBS charge, which secured the moneys owing to RBS by Mr and Mrs Szepietowski, iii) Claygate, but not Ashford House, was subject to the later 2009 Charge in favour of SOCA, which was a second mortgage which secured some 1.24m, iv) RBS was repaid the debt owing to it out of the sale proceeds of Claygate, while Ashford House remains unsold, and The 1.24m secured by the 2009 Charge remains unpaid (save to a minimal extent) despite the sale of Claygate. v) Accordingly, SOCA contends that, as second mortgagee of Claygate, which was subject to a first mortgage, together with Ashford House, in favour of RBS, it is entitled to look to Ashford House in order to obtain payment of the sum which was secured by the 2009 Charge on Claygate, as the proceeds of sale of Claygate were used to pay off what was due to RBS. Mrs Szepietowskis argument to the contrary has two strands. The first strand raises the contention that, in the light of the terms of the Settlement Deed and the 2009 Charge, SOCAs marshalling claim cannot be maintained. The second strand is that, even if marshalling could otherwise be justified, it cannot succeed, as the property against which SOCAs marshalling claim is focussed, namely Ashford House, is and was the home of Mrs Szepietowski, the mortgagor, whereas the property against which the RBS Charge was enforced is not and was never her home. The decisions of the courts below Henderson J held that SOCAs marshalling claim was well founded and the Court of Appeal (Arden, Sullivan and Patten LJJ) agreed with him: see [2010] EWHC 2570 (Ch) and [2011] EWCA Civ 856 respectively. The judgments in both courts concentrated on the first strand of Mrs Szepietowskis argument, and did not consider the second (because it was not raised). Henderson J had held in his 2009 judgment [2009] EWHC 655 (Ch), that Ashford House was excluded from the ambit of the charge envisaged by clause 4.5(ii) of the Settlement Deed, in the light of the terms of the Settlement Deed, and in particular clauses 4.5 and 4.6. However, in his subsequent judgment, he concluded that there was nothing in the Settlement Deed or the 2009 Charge which expressly provided, or necessarily implied, that SOCAs right to marshal was to be excluded: see [2010] EWHC 2570 (Ch), paras 27 and 37. In particular, he did not consider that clauses 4.5 and 4.6 of the Settlement Deed or the fact that there was no debt due to SOCA from Mrs Szepietowski under the 2009 Charge, precluded marshalling. He held that a debt due to SOCA arose from the creation of the charge, if not earlier, albeit one limited to satisfaction from the proceeds of the sale of Claygate para 46. He also held that there was no other reason to deprive SOCA of its prima facie right to marshal para 49. The Court of Appeal, in a judgment given by Patten LJ, agreed, and approved the reasoning, as well as the conclusion, of the Judge, although, as is frequently the position, they did not focus on all the same arguments as the Judge. In particular, they concluded that clause 2.1 of the Settlement Deed did not preclude marshalling: (see [2011] EWCA Civ 856, para 48), and that marshalling was not precluded by the fact that it was SOCA and Mrs Szepietowski, rather than RBS, who decided to sell the Claygate properties, Thames Street and Church Street: (see at para 52). Nor did the Court of Appeal consider that marshalling was precluded by the limited nature of the charge which Mrs Szepietowski gave, and the absence of any underlying obligation to pay the Secured Amount; that was treated as merely going to the discretion whether to exercise the equitable power to marshal: (see at para 54). Mrs Szepietowski now appeals to this court. Marshalling: the principles As Paul Ali explains in his monograph, Marshalling of Securities: Equity and the Priority Ranking of Secured Debt (1999), p 12, para 2.02, the earliest surviving references to marshalling appear to be in two late 17th century cases, Bovey v Skipwith (l671) 1 Ch Cas 201 and Povyes Case (1680) 2 Free 51. The principle was then considered in a number of 18th century cases, which Ali lists in footnote 6 on p 13. A relatively early exposition of the law of marshalling may be found in the judgment of Lord Hardwicke LC in Lanoy v Duke & Duchess of Atholl (1742) 2 Atk 444, 446: Is it not then the constant equity of this court that if a creditor has two funds, he shall take his satisfaction out of that fund upon which another creditor has no lien . Suppose a person, who has two real estates, mortgages both to one person, and afterwards only one estate to a second mortgagee, who had no notice of the first; the court, in order to relieve the second mortgagee, have directed the first to take his satisfaction out of that estate only which is not in mortgage to the second mortgagee, if that is sufficient to satisfy the first mortgage, in order to make room for the second mortgagee, even though the estates descended to two different persons . It is also worth referring to the judgment of Lord Eldon LC in Aldrich v Cooper (1803) 8 Ves Jun 382, 395, where he postulated a case where: two estates [were] mortgaged to A; and one of them mortgaged to B. He has no claim under the deed upon the other estate. It may be so constructed that he could not affect that estate after the death of the mortgagor. But it is the ordinary case to say a person having two funds shall not by his election disappoint the party having only one fund; and equity, to satisfy both, will throw him, who has two funds, upon that, which can be affected by him only; to the intent that the only fund, to which the other has access, may remain clear to him. Marshalling has thus been allowed to a creditor, in a case where (i) his debt is secured by a second mortgage over property (the common property), (ii) the first mortgagee of the common property is also a creditor of the debtor, (iii) the first mortgagee also has security for his debt in the form of another property (the other property) (iv) the first mortgagee has been repaid from the proceeds of sale of the common property, (v) the second mortgagees debt remains unpaid, and (vi) the proceeds of sale of the other property are not needed (at least in full) to repay the first mortgagees debt. In such a case, the second mortgagee can look to the other property to satisfy the debt owed to him. Consider a case where the mortgagor owes 2m to the first mortgagee and 2m to the second mortgagee, the common property and the other property are each worth 3m, and the common property is sold, resulting in repayment in full of the first mortgagee and a reduction of 1m in the debt of the second mortgagee. The mortgagor still owes 1m to the second mortgagee, whether or not the second mortgagee can marshal. The only effect of the second mortgagee being able to marshal would be that it could directly enforce its outstanding 1m debt against the other property rather than falling back on the status of unsecured creditor. This emphasises the point that marshalling only really comes into its own where the mortgagor/debtor is insolvent: marshalling improves the position of the second mortgagee as against the unsecured creditors of the debtor, not as against the debtor herself. Of course, the fact that the second mortgagee could proceed directly against the other property, without the need for a judgment and a charging order, is a minor disadvantage to the mortgagor of the second mortgagee being able to marshal. But Ali is correct in his statement (op cit para 4.48) that, at least in the cases where it has been held to apply, Marshalling is neutral in its impact upon the residue available to the debtor following the discharge of its creditors claims. At one time judges expressed themselves in a way which suggested that a second mortgagee with the right to marshal could compel the first mortgagee to sell the other property to pay off the debt he was owed before having recourse to the common property. Indeed, Lord Eldon LC referred to the second mortgagee ha[ving] a right in equity to compel the first mortgagee to resort to the other in Aldrich v Cooper 8 Ves Jr 382, 388. However, it soon became well established that the first mortgagee had the right to have recourse to any of his securities which first come to hand and to realis[e] his securities in such manner and order as he thinks fit: per Wood V C in Wallis v Woodyear (1855) 2 Jur (NS) 179, 180, and Parker J in Manks v Whiteley [1911] 2 Ch 448, 466 respectively. The principle behind the doctrine of marshalling has been identified by Story in his Commentaries on Equity Jurisprudence, 2nd ed (1892), pp 416 417, in these rather broad terms: The reason is obvious . [By] compelling [the first creditor with the two securities] to take satisfaction out of one of the funds no injustice is done to him . But it is the only way by which [the second creditor with one security] can receive payment. And natural justice requires, that one man should not be permitted from wantonness, or caprice, or rashness, to do an injury to another. In short we may here apply the common civil maxim: Sic utero tuo ut non alienum laedas; and still more emphatically, the Christian maxim, Do unto others as you would they should do unto you. As I see it, there are also good practical reasons for equity adopting the doctrine, namely the unattractive and adventitious benefit which would otherwise be accorded to the first mortgagee. If marshalling was not available to the second mortgagee, the first mortgagees free right to choose the property against which he enforced could have substantial value. In effect, he could auction that right as between the second mortgagee (who would be prepared to pay him to enforce against the other property) and the unsecured creditors of the mortgagor (who, especially where the mortgagor was actually or potentially insolvent, would be prepared to pay him to enforce against the common property). Further, it appears to be somewhat arbitrary that, if he could not marshal, a second mortgagee who had sufficient resources and was prepared to take any associated risk, could redeem the first mortgage (on the basis of redeem up foreclose down see Megarry & Wade, The Law of Real Property, 8th ed, paras 25 110 to 113), and then protect its position as second mortgagee by selling the other property to redeem the first mortgage, before selling the common property. So far as the limits of the applicability of the doctrine of marshalling are concerned, there are a number of cases where it has been held not to be applicable eg because there is no common debtor or where a third party mortgagee may be prejudiced. However, we were taken to no case of specific relevance to the first strand of Mrs Szepietowskis argument. Guidance of a very general nature may, however, be found in what Lord Eldon LC said in Ex p Kendall (1811) 17 Ves 514, 527: The equity is clear upon the authorities, that, if two funds of the debtor are liable to one creditor, and only one fund to another, the former shall be thrown upon that fund, to which the other cannot resort; in order that he may avail himself of his only security: where that can be done without injustice to the debtor or the creditor: but that principle has never been pressed to the effect of injustice to the common debtor On the second strand of Mrs Szepietowskis argument, there is Australian authority to support the proposition that marshalling is not available to a second mortgagee where the first mortgagee is contractually bound to look first to the other property to satisfy the debt due to him see In re Holland (1928) 28 SR (NSW) 369 and Miles v Official Receiver (1963) 109 CLR 501. This seems to me to be correct, at least where the contract is with the mortgagor or with someone else with an interest in the other property, because the basis of the right to marshal is the arbitrariness of allowing the first mortgagees decision as to which asset to enforce against to affect the second mortgagees rights. It also seems to me that the Australian cases accord with the approach of the Court of Appeal in Webb v Smith (1885) 30 Ch D 192. The first strand of Mrs Szepietowskis argument As the oral argument developed, it became apparent that the first strand of Mrs Szepietowskis argument as to why SOCA should be held to be unable to marshal involved two somewhat different contentions. Her first contention is that the simple fact that the 2009 Charge does not secure a debt from her to SOCA, or indeed any debt at all, means that there is no right in SOCA to marshal as it seeks to do. Alternatively, she contends that the provisions of the Settlement Deed and the 2009 Charge, coupled with the circumstances in which they were executed, demonstrate that marshalling is precluded. I shall take those two contentions in turn. The absence of an underlying debt from Mrs Szepietowski to SOCA The first contention raises a point on which we were told by both counsel that there is no authority. In all the cases (save in the so called surety exception discussed by Ali, op cit, chapter 8) where marshalling has been allowed, both the first mortgagee and the second mortgagee have been creditors of the same debtor/mortgagor. However, in this case, at least according to her argument, Mrs Szepietowski never owed any money to SOCA other than such sum, if any, as was payable to SOCA out of the proceeds of sale of Claygate after payment of all prior claims, and that sum has been paid to SOCA; indeed, according to her case, the 2009 Charge does not secure a debt from anybody, other than that contingent sum. Although that proposition was challenged by SOCA, I consider that it is correct. The terms of the Settlement Deed are concerned with the ownership of, and rights over, property, and not with creating or acknowledging debts (other than Mr and Mrs Szepietowskis debts to HMRC). And the 2009 Charge is notable for the absence of any provision which creates or acknowledges an obligation on Mrs Szepietowski, the mortgagor, to pay the Secured Amount. All that she is obliged to do in relation to that sum under clause 2 is to use the proceeds of sale of Claygate towards settling it, after any prior obligations have been met. It is true that clause 7.1 refers to the Secured Amount becom[ing] due, but it does not say from whom, and its language is readily explained by the terms of section 101 of the Law of Property Act 1925, to which it refers. In any event, SOCAs contention that the 2009 Charge secured a debt due from Mrs Szepietowski is given its quietus by the unambiguous terms of clause 7.2. It therefore appears clear to me that the 2009 Charge did not create, or acknowledge the existence of, any debt from Mrs Szepietowski, or anyone else, to SOCA, save that it rendered her liable for a contingent debt, in that she was bound to pay SOCA an amount of up to 1.24m out of such sum, if any, as remained from the proceeds of sale of Claygate after the RBS Charge was paid off. The notion that the 2009 Charge did not impose or acknowledge an obligation to pay the Secured Amount on the part of Mrs Szepietowski is also supported by (i) the fact that the Settlement Deed, from which it originates, did not impose such a duty, (ii) the terms of clause 4.5 of that Deed which provides for the 2009 Charge (a point dealt with more fully in para 69 below), and (iii) the fact that both the Settlement Deed and the 2009 Charge originated from proceedings under the 2002 Act, whose purpose is to recover specific properties not to recover a sum of money. The fact that the 2009 Charge involved giving SOCA security over Claygate without an underlying debt being owed by the mortgagor (or anyone else), save the contingent debt identified in para 42 above, throws up an intriguing problem in relation to the right to marshal. There is plainly a difference between marshalling in the normal case, where the mortgage to the second mortgagee is security for a debt due from the mortgagor to the second mortgagee, and marshalling in a case such as the present, where there is no underlying debt from the mortgagor (or anyone else) to the second mortgagee (other than a contingent liability to pay a sum out of the net proceeds of sale of the common property). As explained in paras 32 33 above, in the normal case, marshalling does not result in the liabilities of the mortgagor being increased after the sale of the common property. However, if the second mortgagee can marshal in a case such as this, where there is no underlying debt due to it from the mortgagor, the mortgagors liabilities would be increased at least once the common property has been sold by the first mortgagee. Thus, (i) if SOCA can marshal in this case, Ashford House would effectively be subject to a second mortgage (ranking after TMBs first mortgage see para 8 above) securing just under 1.24m, and Mrs Szepietowski would have to pay that sum to SOCA or lose her home, whereas (ii) if SOCA cannot marshal, then Ashford House would be free of any second mortgage, and Mrs Szepietowski would be free of any further liability to SOCA. We are therefore called on to decide whether, in a case where there is no underlying debt from the mortgagor to support the second mortgage (save the contingent debt described at the end of para 42 above), (i) the second mortgagee can invoke the doctrine of marshalling because the basis for its application, as described in paras 35 and 36 above, exists, or (ii) the second mortgagee should not be able to marshal as there is no underlying debt from the mortgagor to the second mortgagee after the sale of the common property and the distribution of its proceeds of sale, and there is a fundamental, if unspoken, requirement for the doctrine to be applicable that there is a debt owing to the second mortgagee at the time when he seeks to marshal. I refer to the alleged requirement being unspoken, as there is no judgment which deals with this question, although many of the explanations of marshalling assume that the second mortgagee is owed an underlying debt by the mortgagor (for instance, the passages quoted from Lord Hoffmann and Rose LJ in paras 1 and 2 above refer to a debt owing to the second mortgagor), and other definitions do not (see per Lord Hardwicke LC and Lord Eldon LC in paras 29 and 30 above respectively). In the end, I do not find any these observations of assistance on this issue because they were all made in the context of cases where there was an underlying debt due from the mortgagor which was secured by the second mortgage. The judges concerned were simply not addressing their minds to the point at issue in this case. I accept that it can fairly be said that the justification for marshalling, namely that the extent or value of the second mortgagees rights should not depend on which of the first mortgagees securities is realised first, and that the underlying reasons for marshalling identified in paras 35 and 36 above, apply in the present case. I also accept that the only difference between the result of marshalling in the cases where it has been permitted and in the present case is the identity of the party who is prejudiced by the marshalling (namely the unsecured creditors in the previous cases, as against the debtor in the present case). Accordingly, I acknowledge the force of Lord Carnwaths reasoning in paras 101 104 below. Nonetheless, despite Miss Harmans attractively developed argument to the contrary, I have concluded that as a matter of principle, marshalling is not available to a second mortgagee where, as here, the common property does not secure a debt due from the mortgagor, but is merely available as security for what the second mortgagee can extract from that property. My reasoning can be put in a number of different ways, but in the end they amount to much the same thing, namely that, in such a case, there is simply nothing, in particular no debt due from the mortgagor, from which the right to marshal can arise, once the common property has been sold and the proceeds of sale distributed in accordance with the legal priorities. As already explained, the only debt which can be said to be due from the mortgagor to the second mortgagee in a case such as this is the sum (if any) which is left from the proceeds of sale of the common property after the costs of sale and the debt due to the first mortgagee have been paid off: see clause 2.1 (supported by clause 7.2) of the 2009 Charge. Once that (admittedly derisory) sum was paid to SOCA, there was nothing due from Mrs Szepietowski (or anyone else) to SOCA, so it is difficult to see on what basis SOCA can say that it is entitled to enforce a right to be paid out of another property owned by Mrs Szepietowski. It is one thing for a second mortgagee, who was a secured creditor of the mortgagor and has not been paid in full (or at all) from the sale of the secured property, to be able to look to other property of the debtor to discharge a debt which remains outstanding. It is quite another for a second mortgagee with no outstanding debt due from the mortgagor to be able to look to another property of the mortgagor to realise what it hoped to raise from the sale of the secured property. In my judgment, once there is no debt due from the mortgagor to the second mortgagee, the second mortgagee has no right to marshal. In this case, therefore, it follows that SOCA can have no right to marshal. My conclusion receives support if one considers the position where the mortgagor is insolvent. As explained in paras 32 33 above, a second mortgagee, whose mortgage secured a debt due to him from the mortgagor would (if he could marshal) either be treated as a secured creditor whose security for the debt was the other property to the detriment of her unsecured creditors, or (if he could not marshal) would join the ranks of the unsecured creditors of the mortgagors estate in respect of his debt. If a second mortgagee with no underlying debt from the mortgagor could in principle marshal, then, were the mortgagor to be insolvent, the second mortgagee would either be treated, in effect, as a secured creditor whose security was the other property, whereas, if the second mortgagee could not marshal in such a case, it would have no claim at all against the mortgagors estate. There would be nothing surprising about the latter possibility, whereas it would be surprising if marshalling could create what for all intents and purposes was a secured debt, when, in the absence of marshalling, there would be no debt at all. My conclusion is also supported if the right to marshal is an incident of the second mortgage when it is granted, which appears to me to be logical and in accordance with the Judges approach: see [2010] EWHC 2570 (Ch), paras 27 and 37, as summarised in para 25 above. It is normally easy to imply a common intention on the part of the parties to the second mortgage (the mortgagor and the second mortgagee) that there should be a right to marshal where the second mortgage secures a debt due from the mortgagor, because such a right is to the manifest advantage of the second mortgagee and of no significance either way to the mortgagor (see paras 32 33 above). However, where there is no underlying debt due from the mortgagor (other than what the second mortgagee can extract from the common property), it would be plainly contrary to the mortgagors interest that the second mortgagee should be able to marshal; accordingly, normal principle would suggest that, at least in the absence of special facts, there should be no right to marshal in such a case. I should briefly revert to the notion that the absence of an underlying debt should be a factor which goes to the discretion of the judge when deciding whether to permit the second mortgagee to marshal, as suggested by the Court of Appeal at para 54 of its judgment. Not only does that seem to me to be wrong in principle, as already explained. It also appears to involve a recipe for uncertainty. Marshalling is an equitable right (or remedy), but that does not mean that its exercise should depend too readily on the individual merits of the case. It should, so far as possible, be governed by clear principles so mortgagors and mortgagees know where they stand. Accordingly, I conclude that, where the second mortgage does not secure a debt owing from the mortgagor to the second mortgagee, the right to marshal should not normally exist once the common property is sold by the first mortgagee and the proceeds of sale distributed, because there would be no surviving debt owing from the mortgagor to the second mortgagee. In such a case, equity should proceed on the basis that the second mortgagee normally takes the risk that the first mortgagee will realise his debt through the sale of the common property rather than the sale of the other property. I draw some support from the observation of Lord Eldon LC in Kendall 17 Ves 514, 527 that the doctrine of marshalling has never been pressed to the effect of injustice to the common debtor. Of course, this can be said to beg the question in the sense that it may be a matter of debate as to whether it would wreak an injustice on the mortgagor in a case such as this to permit marshalling. However, if one bears in mind that marshalling, as it has been understood normally, involves no net increase in the liability of the debtor/mortgagor when the second mortgagees right of marshalling arises, I consider that the observation tends to support the notion that the doctrine of marshalling does not normally apply where the second mortgagee does not secure a debt from the mortgagor. Finally on this aspect, I have intentionally used the word normally in paras 56 57 above, because marshalling is an equitable remedy. Accordingly, whether it is available in any particular case may depend on the circumstances, just as it may depend on the circumstances of a case where it would prima facie apply, whether it actually does apply. Notwithstanding what I have said in para 55, it would be wrong to rule out the possibility of an exceptional case, where the generalisations in para 56 or para 57 would not apply, although absent express words which permit or envisage marshalling, I find it hard to conceive of such a case. As I understand it, if, as I have concluded, marshalling is not normally open to a second mortgagee where there is no underlying debt, SOCA does not contend that this is an exceptional case where it would be open to it. Therefore Mrs Szepietowskis remaining two contentions need not be addressed. However, it is right to express a view upon them, as they were fully argued and may be of some significance in future marshalling disputes. The terms of the Settlement Deed and the 2009 Charge If, contrary to the above conclusion, marshalling should be available to a second mortgagee where there is no underlying debt from the mortgagor in the same way as where there is such an underlying debt, I would still have allowed Mrs Szepietowskis appeal on the basis of the other contention advanced as part of the first strand of her argument. As explained in para 25 above, the courts below approached the issue on the basis that marshalling should not be excluded unless the parties expressly agreed that it should be, or unless its exclusion was necessarily implied by the terms of the 2009 Charge. Marshalling is an equitable remedy or right, and it should not therefore be available to a second mortgagee in circumstances where it would be inequitable to allow it. While there is considerable overlap between the test applied by the courts below and inequitability, and while, as is reflected in para 55 above, any court must be careful to avoid an approach to equity which is too open textured or subjective, I consider that the approach of the courts below involved setting too high and too rigid a hurdle for a party seeking to mount a case against marshalling. In my view, the correct approach is to ask whether, in the perception of an objective reasonable bystander at the date of the grant of the second mortgage, taking into account, in very summary terms, (i) the terms of the second mortgage, (ii) any contract or other arrangement which gave rise to it, (iii) what passed between the parties prior to its execution, and (iv) all the admissible surrounding facts, it is reasonable to conclude that the second mortgagee was not intended to be able to marshal on the occurrence of the facts which would otherwise potentially give rise to the right to marshal. It is true that the possibility of marshalling can only arise some time after the mortgage is granted (and indeed that it may never arise), and it is true that facts could arise after the second mortgage which render it inequitable that the second mortgagee should have (or should not have) the right to marshal. However, it seems to me that the starting point for deciding whether there should be a right to marshal must be when the second mortgage is created. In the absence of relevant subsequent developments, the question must be judged as at that date. Furthermore, it appears to me to accord with principle that the question must be judged objectively, based on what passed between, was known to, and would consequently have been reasonably understood by, the parties. In my view, a combination of factors in this case establish that, even if, given the facts summarised in para 22 above, the normal presumption would be that SOCA, as the second mortgagee, should be entitled to marshal, it should not be able to do so in this case. First, the 2009 Charge was entered into to give effect to a claim under the 2002 Act. As Lord Carnwath points out in his judgment, ARAs (and now SOCAs) rights and powers are purely statutory in nature. For present purposes, its task under the 2002 Act was to identify, to claim and, through a court order, to obtain recoverable property see sections 243, 266, 276 and 304 310. SOCAs rights under the 2002 Act were thus against specific assets of a respondent, and there could have been no question of a debt being created in favour of the ARA against a person such as Mrs Szepietowski, unless, of course, she had agreed to it, which, as explained above, she had not. Accordingly, it seems unlikely that the parties to the 2009 Charge could have intended SOCA to have a claim against a property which was not recoverable under the 2002 Act. Secondly, there is the point that it would potentially be to the disadvantage of one of the parties to the 2009 Charge, namely Mrs Szepietowski, if the other party, SOCA, had the right to marshal. Of itself, this cannot be decisive, but, because there is no underlying debt from the mortgagor, this would make the normal presumption in favour of marshalling less strong than it would be in the normal case where there is an underlying debt due from the mortgagor. (This is not inconsistent with the point made in para 55 above, because, for present purposes, I am assuming, contrary to my earlier conclusion, that the absence of an underlying debt does not vitiate the right to marshal). Thirdly, as explained in paras 7 and 8 above, Ashford House was included in Annexe A, but not in Annexe B or C, to the Settlement Deed, so it is clear that the parties intended it to remain with Mrs Szepietowski, unencumbered by any liability to SOCA. It would therefore be somewhat curious if the effect of the 2009 Charge, which was executed pursuant to the Settlement Deed, should have the result of encumbering Ashford House with a liability to SOCA. Fourthly, in the Annexes, the parties did not treat Ashford House as subject to the RBS Charge, unlike Church Street, Thames Street and Claygate (see paras 8 and 9 above). Given that it is fundamental to SOCAs marshalling claim that Ashford House was subject to the RBS Charge, it is again somewhat curious that this claim arises out of a charge executed pursuant to a contract which plainly proceeds on the assumption that it was not. Fifthly, particularly in the context of these three points, the fact that the Settlement Deed is expressed to be in full and final settlement of all claims SOCA may have relating to the properties in Annexe A (see para 8 above) is not entirely easy to reconcile with a subsequent marshalling claim by SOCA against Ashford House. Sixthly, the effect of clauses 4.4 and 4.5 of the Settlement Deed, as explained in paras 11 and 12 above, is that Mrs Szepietowski would only have had to grant a charge over Claygate if three separate conditions were satisfied, namely (i) under clause 4.5(i), SOCA decided it wanted Thames Street and Church Street sold, (ii) under clause 4.5(ii), RBS refused to release those properties from the RBS Charge, and (iii) under clause 4.4, Mrs Szepietowski decided to have Claygate vested back in herself (as she could scarcely have granted SOCA a charge over a property it owned). If any of these three requirements had been unsatisfied, there would have been no 2009 Charge, and, of course, without that charge there would have been no possibility of marshalling, and therefore no possibility of SOCA claiming that any sum was secured in its favour over Ashford House. It seems particularly unlikely that SOCAs ability to mount such a claim would have been intended to depend on conditions (i) or (iii). Seventhly, over and above these points on the contractual documentation, there is the point that Ashford House was Mrs Szepietowskis home. Common sense suggests that it was one of the relatively few properties in Annexe A which was not vested in the Trustee, because of that fact. The Settlement Deed represented a compromise which left Mr and Mrs Szepietowski with some properties, and it seems very likely that they would have been particularly keen to keep their home, and that SOCA accepted this in the Settlement Deed. That does not fit comfortably with the idea that SOCA and Mrs Szepietowski can have intended that a document subsequently executed pursuant to that Deed should lead to a substantial potential charge over that home. In my view, the combination of these various factors establishes that, even if a second mortgagee whose mortgage secures no underlying debt from the mortgagor is entitled to marshal, the contractual documentation and background facts in this case establish that it would be inequitable for SOCA to be permitted to marshal against Ashford House. To permit SOCA to marshal would involve flying in the face of the understanding of both parties to the mortgage said to give rise to the right, namely the 2009 Charge, as revealed in the 2009 Charge itself, and the Settlement Deed from which it originates and indeed to which it refers in its preamble. The second strand of Mrs Szepietowskis argument Mrs Szepietowski contends that the fact that Ashford House is her home means that RBS would not, in reality, have been able to enforce its rights under the RBS Charge against Ashford House before it could have enforced its rights against Claygate. Accordingly, in reliance on the principle described in para 38 above and the Australian decisions there cited, In re Holland 28 SR (NSW) 369 and Miles v Official Receiver 109 CLR 501, she contends that marshalling would not, in any event, be available to SOCA. This argument relies on two separate legal points. The first is the protection given by section 36 of the Administration of Justice Act 1970 (section 36) to defaulting mortgagors of dwelling houses where the mortgagee is claiming possession. The second point is the respect which is afforded to an individuals home under article 8 of the European Convention on Human Rights (article 8). In my view, there is nothing in either of these points. The only thing which can be made of the fact that the marshalling claim relates to Mrs Szepietowskis home is the point made in para 71 above. Assuming in Mrs Szepietowskis favour that section 36 and/or Article 8 would have rendered it more difficult for RBS to enforce the RBS Charge against Ashford House than against Claygate, that would be wholly insufficient to prevent SOCA being able to marshal, if it was otherwise entitled to do so. Where the requirements of the right to marshal are otherwise present, it would require a contractually enforceable obligation, or something close thereto, on the first mortgagee to enforce against the common property in priority to the other property for the second mortgagee to lose his right to marshal. (The words or something close thereto are added out of an abundance of caution, based on an acceptance that nobody can foresee every possibility: I find it very hard to think of an arrangement short of a binding estoppel which would do). It would be wrong, both in principle and in practice, if it were otherwise. The right to marshal is based on a simple principle, and there is no reason to dilute it in the way contended for on behalf of Mrs Szepietowski. After all, the right to marshal is not based on the proposition that the first mortgagee is under an obligation to sell the other property first see para 34 above. Further, if Mrs Szepietowskis contention were accepted, one can readily imagine all sorts of arguments as to whether one property is more difficult to sell than another, and whether the extent or nature of the difficulty is such as qualifies for the purposes of the contention. Mr Tager QC suggested that if RBS had proceeded against Ashford House, the court would have stayed the proceedings on the basis that it should go against Claygate. I am by no means convinced that that is right. However, even if it was, I do not consider that would disqualify SOCA from seeking to marshal if it was otherwise able to do so. Conclusion In these circumstances, I would allow this appeal, and hold that SOCA does not have the right to marshal as it contends. I should add that, since preparing this judgment I have seen in draft the judgment of Lord Reed and the brief judgment of Lord Sumption, with both of which I agree. LORD SUMPTION I agree with the order proposed by Lord Neuberger for all the reasons that he gives. In particular I agree that subject to any contrary provision in the parties agreement, the charge must secure one or more underlying debts (or other personal liabilities) of the chargor to the chargee before the latter can require it to be marshalled with other securities given to other chargees. The reason is that a charge to secure a liability of the chargor to the chargee is a secondary benefit. It is available only for the purpose of enforcing the primary benefit, namely the underlying personal liability which the chargor owes him The right to marshall is an equity designed to ensure that the choices made by another chargee do not frustrate the enforcement of the underlying personal liability. If there is no underlying personal liability, then the sole effect of the transaction is to confer a contingent interest in the charged asset, not as the means to the recovery of any liability but as itself constituting the primary benefit. If the asset is subject to a prior charge in favour of someone else, the benefit thus conferred may not be worth very much. But that is the risk that the chargee necessarily accepts by taking no right of recourse against the chargor personally but only a potentially flawed interest in a specific asset. Once the chargee has enforced the charge against the asset in question, his claims against the chargor are exhausted. There is no possible equity that could entitle him to more. In this situation if the chargee can have the securities marshalled and proceed in addition against a different asset which was never charged to him, then the effect is to increase the chargors financial exposure. Since this would conflict with the whole basis on which equity developed the right to marshall, I cannot accept that it represents the law. I agree that the appeal should be allowed, for the reasons given by Lord LORD REED Neuberger and Lord Sumption. In view of the infrequency with which cases on this topic arise, and the application of the Proceeds of Crime Act 2002 throughout the United Kingdom, there may be some value in my adding some observations about the equivalent Scottish doctrine of catholic securities, described succinctly by Lord Adam in Nicols Trustees v Hill (1889) 16 R 416, 421: That doctrine is that when a prior creditor has one way of working out his preference which is less injurious to the postponed creditor than another, the prior creditor is bound either to adopt that course, or by assignation to put the postponed creditor into his right. The equitable basis of the doctrine, as Lord Adam described it, was explained by Lord President McNeill in Littlejohn v Black (1855) 18 D 207, 212: In the ordinary case of a catholic creditor ie, a creditor holding security over two subjects, which for the sake of simplicity I shall suppose to be heritable subjects and another creditor holding a postponed security over one of them, there can be no doubt that the catholic creditor is entitled to operate payment out of the two subjects as he best can for his own interest, but he is not entitled arbitrarily or nimiously to proceed in such a manner as to injure the secondary creditor without benefiting himself as, for instance, capriciously to take his payment entirely out of the subjects over which there is a second security, and thereby to exhaust that subject, to the detriment of the second creditor, leaving the other subject of his own security unaffected or unexhausted. The second creditor will be protected against a proceeding so contrary to equity, and the primary creditor will be compelled either to take his payment in the first instance out of that one of the subjects in which no other creditor holds a special interest, or to assign his right to the second creditor, from whom he has wrested the only subject of his security. Securities are neutral in their effect upon the debtor. Their effect is to strengthen the position of the secured creditor at the expense of unsecured creditors, since the holder of a security holds a right, accessory in nature, which he can exercise to secure the payment of the debt that is distinct from, and additional to, the right of action and execution which any creditor can exercise to enforce the performance of the debtors personal obligation. The doctrine of catholic securities can therefore operate to the prejudice of unsecured creditors, but it cannot affect the interests of the debtor. As the Lord President stated (ibid): The interest ie the legitimate interest of the primary creditor goes no farther than to get payment of his debt, and that is secured to him. The interest of the secondary creditor is to realize the value of his postponed security, and that is secured to him, in so far as is compatible with payment of the prior debt due to the primary creditor. The interest of the common debtor is truly nothing, or rather it is, or at least it ought to be, to allow both his creditors to receive full payment out of the subjects he had pledged to them. The ideas underlying the Scottish doctrine evidently have much in common with those underlying the English principle of marshalling, as explained in the authorities cited by Lord Neuberger. Lord President McNeills explanation that the Scottish doctrine protects the interests of the secondary creditor, but does not affect the interests of the debtor, appears to me to be equally true of the English principle, and to be particularly relevant to the present case. As Lord Neuberger has explained, the debt which was owed to SOCA and secured by the 2009 Charge was contingent upon a number of eventualities, one of which was whether any amount (and if so, how much) was left over after prior claims had been met out of the net proceeds of sale of Claygate: something which depended upon RBSs decision as to the order in which it should realise its securities. It follows that the short answer to SOCAs claim that it should be entitled to the benefit of RBSs security over Ashford House in order to secure the payment of the balance of the debt owed to it is that there is no such balance: it received, out of the sale proceeds of Claygate, all that it was entitled to receive. SOCAs argument to the contrary assumes, contrary to clause 7.2 of the 2009 Charge, that there was a debt owed to SOCA which was ascertainable independently of RBSs election. Another way of putting the point is to say that there is no scope for marshalling of securities, as SOCA is no longer a creditor of Mrs Szepietowski, and there is therefore no longer any personal liability which is secured by the 2009 Charge. It is because of the debts being contingent upon (amongst other things) RBSs decision as to the order in which to realise its securities that SOCAs argument is inconsistent with the principle that marshalling is neutral in its effect upon the debtor. If SOCA were entitled to treat the balance of the Secured Amount (as it was somewhat confusingly described in the 2009 Charge) as being secured over Ashford House, the effect would be to increase the amount which Mrs Szepietowski had to pay: in the light of clause 7.2, it cannot be argued that, absent marshalling, SOCA would be a creditor for the balance of the Secured Amount. That in itself demonstrates that SOCAs claim is not a proper application of the principle of marshalling. LORD CARNWATH I agree that the appeal should be allowed, but on narrower grounds than those favoured by Lord Neuberger. In my view the solution is to be found, not in the general law of marshalling, but in the interpretation of a particular contract against its unusual statutory and factual background. On that aspect, I agree with the conclusion and much of the reasoning of Lord Neuberger under the heading The terms of the Settlement Deed and the 2009 Charge (paras 60 71), but with a rather different emphasis. The starting point to my mind is the statutory jurisdiction under which SOCA was operating, and under which the compromise was agreed. SOCAs jurisdiction under this part of the 2002 Act is asset based, rather than financial. Its task is to identify and claim recoverable property, that is property acquired through unlawful conduct as provided for in the Act. The essential purpose of the settlement deed was to resolve a dispute between SOCA and the appellant as to the properties to be treated as falling within that category. It was consistent with that scheme that the appellant did not undertake a personal obligation to pay any sum of money as such, beyond the value of her interest in the properties specified. SOCA started with a potential claim to 20 items of recoverable property (listed in annexe A) but they agreed to accept the 13 transfer properties listed in annex B in full and final settlement of their claims in relation to all the properties in annexe A (cl 2.1), they being expected at the time to realise some 5.4m. Her home, Ashford House, was specifically excluded. As I understand the arrangement, the two additional properties in annexe C (Claygate) were needed solely to deal with the complication of the RBS charge over two of the transfer properties (Thames Street and Church Street). If RBS had agreed to the transfer of their charge to Claygate (under cl 4.5(i)), there would have been no such complication, the additional properties could have dropped out of the picture (cl 4.4), and no question of marshalling could have arisen. As it was, the trustees rights to Thames Street and Church Street were, on their sale, converted into another property right, a charge over Claygate for the amount (1.24m) of their sale proceeds as paid to RBS (cl 4.5(ii), 2009 charge cl 1). Consistently with the scheme of the settlement, clause 2 of the charge defined the appellants obligation on sale of that property as being to apply the proceeds of sale. , in settlement of the secured amount. In this statutory context, and taken with clause 7.2, I read this wording as not only excluding any personal liability on the part of the appellant, but as also impliedly excluding recourse to any source for payment other than those identified. If SOCA had wished to include Ashford House as potentially recoverable property, they should have done so specifically, rather than hope to bring it in later by an equitable backdoor. In the result, I agree with Lord Neubergers conclusion at paragraph 72, not so much on the basis that it would be inequitable to allow marshalling against Ashford House, but that on the proper interpretation of the agreement in its statutory context that possibility is excluded. This conclusion accords with that provisionally reached by Henderson J in his first judgment ([2009] EWHC 655 (Ch) para 31). In his later judgment on the present issues ([[2010] EWHC 2570 (Ch) paras 35 36) he changed his mind. He thought that clause 2.1 could not be read as extending to future claims against or relating to the released properties. He took account of some words of Lord Bingham of Cornhill in Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251, para 19 (the BCCI case), when holding that the general release arrived at in a settlement agreement in that case did not extend to future claims for stigma damages by BCCI employees who had been made redundant in 1990. In the Court of Appeal, Patten LJ agreed. He said: The claim to be subrogated to the RBS charge against Ashford House is not a claim against Mrs Szepietowski in the proceedings or even a claim against her at all. It is a claim to enforce the subsisting clause 4.5 charge by invoking the courts equitable jurisdiction to marshal the available security between existing creditors. Clause 2.1 is not directed to that issue which arises as a result of rights granted to SOCA under the deed. (para 47) With respect to both courts, I think that Henderson Js first thoughts were correct. The marshalling claim is sufficiently linked to the subject matter of the agreement to fall within the words of clause 2.1, in the context of an agreement which, as I have said, was intended to define the limits of SOCAs property claims arising out of these particular allegations of unlawful conduct, and in relation to these properties. This is a very long way from the facts of the BCCI case. As the judge acknowledged, and as is apparent from Lord Binghams words quoted by him, that was a case in which the parties, at the time of the release, could never have had in contemplation at all the type of claims subsequently advanced. Furthermore, with respect to Patten LJ, to focus on whether the marshalling claim is one against Mrs Szepietowski herself is to disregard the whole purpose of the agreement, which as I have said was not to define personal claims, but to fix the limits of SOCAs property claims under the Act. The addition in clause 2.1 of the words (claims) in relation to the properties listed seems to me quite sufficient, if necessary, to make that clear. I would have been content to stop at that point. But in view of the attention given to the issue of marshalling in the courts below, and since I have reservations about Lord Neubergers reasoning on this topic, I think it right to add my own comments. The courts below struggled with the concept of a charge without an underlying debt, which the judge described as a contradiction in terms (para 45). He referred to Lord Hoffmanns statement that an interest provided by way of security entitles the holder to resort to the property only for the purpose of satisfying some liability due to him (whether from the person providing the security or a third party) (In re Bank of Credit and Commerce International SA (No 8) [1998] AC 214, 226 (the BCCI (No 8) Case)). This discussion arose in the context of what he called the two debts condition (para 47). This, as I understand it, he took from the statement of Rose LJ in the Court of Appeal decision in the BCCI (No 8) Case [1996] Ch 245, 271 (in the passage already quoted by Neuberger LJ para 2) that for the [marshalling] doctrine to apply there must be two debts owed by the same debtor to two different creditors. It was argued that since there was no debt due to SOCA, marshalling could not be invoked. The judge concluded that this condition was satisfied, even if the appellant could not be sued personally: That there was a debt owed by her to SOCA is in my judgment undeniable, even if it was a debt that could be enforced only by sale of the Claygate Properties (para 46). In the Court of Appeal, Patten LJ (paras 53 54) recorded that there had been no challenge to the judges finding that a debt was created by the charge. Nor was this issue as such reopened by the appellants printed case in this court (see para 154). Notwithstanding that formal position, the majority of this court have as I understand it thought it appropriate to re examine the no debt issue, in order to avoid the law being developed on a false basis. I do not dissent from that approach, although I am not convinced that the issue is one of any general importance. On any view, the concept of a charge without an underlying personal debt seems sufficiently unusual for it to be difficult to consider outside the particular factual context in which it may arise. As to the principle, I agree with Lord Neuberger (para 48) that Rose LJs words were not directed to the issue which arises in this case. They cannot in my view be read as sufficient in themselves to establish a general two debts rule. I do not find it so easy, however, to discount the words used in the 18th and 19th century authorities, since it is they which explain the basis on which the principle was developed. Those cases make clear to my mind, as Miss Harman submits, that it is a remedy which operates primarily between security holders, not between them and the common debtor or chargor. In the words of Lord Eldon LC in Aldrich v Cooper 8 Ves Jun 382, 395 (quoted by Lord Neuberger at para 30) a person having [access to] two funds shall not by his election disappoint the party having only one fund; or as Professor Story put it (quoted at para 35) it is a matter of natural justice between the two creditors. To achieve this, the second charge holder has an equity to require that the first creditor satisfy himself (or be treated as having satisfied himself) so far as possible out of the security or fund to which the latter has no claim (per Lord Hoffmann in the BCCI (No 8) Case [1998] AC 214, 231, quoted at para 1). The Scottish cases, to which Lord Reed refers, are to the same effect. With regard to the interests of the common debtor or chargor, the only qualification to be found in those judgments is in Lord Eldon LCs observation in Ex P Kendall 17 Ves 514, 527 that the principle has never been pressed to the effect of injustice to the common debtor (quoted by Lord Neuberger at para 37). However, it is not clear what form of injustice he had in mind. In the normal case, the common debtor will have accepted the risk of enforcement of the two charged sums in full against both securities. There is no injustice to him if that risk becomes fact. That position, as it seems to me, is unaffected by whether or not the charger is also subject to a personal liability. In either case, he has accepted the risk of enforcement against both properties, contingent only on the choice of the first chargee. Lord Neubergers view to the contrary depends as I understand it on looking at the position after the common property has been sold by the first chargee (paras 46 47). However, that seems to me with respect to look at the position from the wrong end. What matters is not how things turn out, but whether that result is within the scope of the risk which the chargor has undertaken at the time the charges were granted. Clearly, once the common property is sold, assuming the chargor is solvent and there is no personal liability, he will be worse off if marshalling is allowed than if it is not. Instead of enforcement being limited to what can be extracted from the second property, it will extend to the remaining value of both properties. However, there is no injustice in that result if it is within the scope of the risk which he has voluntarily accepted. On the wider issue, therefore, I agree with Miss Harmans submissions. Assuming that, at least in theory, there might be other circumstances (outside the present statutory context) in which a charge would be granted without an underlying personal liability, I see no reason in principle why the remedy of marshalling should be excluded. However, for the reasons already given, I would uphold the appeal on the issue of construction. LORD HUGHES I entirely agree that this appeal should be allowed and that on the facts of this transaction SOCA does not have the right to marshal against Ashford House. With a single exception, I do so for all the reasons given by Lord Neuberger. The single exception concerns the general proposition that before marshalling can be claimed the security held by the second chargee must secure an underlying personal debt of his to the chargor. It seems to me, as it does to Lord Carnwath, that the essence of marshalling lies in the existence of concurrent securities, rather than in the nature of the liability which they secure. Clearly there will always be some liability by the chargee to the chargor. It will normally, no doubt, be a personal debt from the chargee to the chargor. But it may occasionally be something different, as for example if the chargor is prepared to underwrite the debt of another to the extent of putting up security but is not prepared to enter into an unlimited personal guarantee. If, in such a situation, the security offered is a second charge on some asset (Blackacre) already charged to a prior chargee and if that prior chargee also has additional security (Whiteacre) for whatever liability the chargor has to him, the occasion for the second chargee to seek to marshal may arise if the prior chargee opts to enforce the common security (Blackacre) rather than his additional security (Whiteacre). There may be something in the particular transaction, as there is here, which demonstrates that marshalling would be inconsistent with its nature. But as a general proposition it seems to me that there is no obstacle in the situation described to the second chargee marshalling against Whiteacre up to the amount which would have been available to him in Blackacre if the prior chargee had opted to enforce first against Whiteacre. True it is that the second chargee has always known that he ranks second to the prior chargee and that accordingly he has always faced the risk that Blackacre may be used up by the prior chargee. But that is true equally where there is also a personal liability. The function of marshalling is to avoid his losing his security simply because the prior chargee opts to enforce against Blackacre rather than against his additional security, Whiteacre. The existence or non existence of a personal liability in the chargor makes no difference. Next, it is certainly true that it is of the essence of marshalling that it is neutral so far as the chargor/debtor is concerned, in the sense that he ends up paying in total out of the two securities no more than he was always liable to pay. However, it does not seem to me that the chargors total exposure is impermissibly beyond what it was always likely to be by marshalling in the situation described. It will still be the same as it would have been if either (a) the prior chargee had enforced first against Whiteacre or (b) the liability to the prior chargee had otherwise been discharged, both of which events were always on the cards. For these reasons, although the occasion for the distinction to bite will no doubt be rare, I prefer Lord Carnwaths conclusion on this narrow point.

In 2005, the Assets Recovery Agency (ARA) obtained an interim receiving order over certain properties acquired by Mrs Szepietowskis husband with money allegedly obtained through drug trafficking, mortgage fraud and concealment from the Revenue. In November 2006, the ARA began civil proceedings against Mr and Mrs Szepietowski (the Szepietowskis), seeking to confiscate 20 properties on the basis that they constituted recoverable property within section 266 of the Proceeds of Crime Act 2002 (the 2002 Act). These properties included Ashford House (the Szepietowskis home), two properties known as Thames Street, two properties known as Church Street, and two properties known as Claygate. These properties were all registered in the name of Mrs Szepietowski and had been charged to RBS for a debt of about 3.225m (the RBS debt). On 16 January 2008, the Szepietowskis and the ARA settled the proceedings on terms contained in documents attached to a consent order (including a Settlement Deed). Pursuant to the terms of the Settlement Deed, (a) Thames Street and Church Street were sold and the proceeds paid over in part satisfaction of the RBS debt, and (b) in September 2009, Mrs Szepietowski granted a charge over Claygate (the 2009 Charge) to the Serious Organised Crime Agency (SOCA, as the ARA had by this point become) entitling SOCA to recover a sum of up to 1.24m from the proceeds of sale of Claygate. The 2009 Charge (a) was a second charge over Claygate as it was subject to the RBS debt, and (b) contained various provisions including a statement that Mrs Szepietowski had no personal liability to pay any money to SOCA. In late 2009, Mrs Szepietowski sold Claygate for 2.44m and, once the net proceeds of sale of Claygate had been used to pay off the RBS debt, all that was left to satisfy SOCAs rights under the 2009 Charge was 1,324.16. SOCA then sought to invoke the right to marshal against Ashford House. The right to marshal classically applies when there are two or more creditors, each of whom is owed a debt by the same debtor, but one of whom has security in the form of a charge on more than one property (the first mortgagee), whilst the other has security in the form of an inferior charge on only one of those properties (the second mortgagee). If the first mortgagee chooses to enforce his charge against the property which secures both debts (the common property), the second mortgagee is able to enforce his charge against the property which only secured the first mortgagees debt (the other property). SOCA argued that, as the proceeds of sale of Claygate (the common property, which was subject to the charge in favour of RBS and the 2009 Charge in favour of SOCA) were used to pay off what was due to RBS, it was entitled under the marshalling principle to look to Ashford House (the other property, which was only subject to the charge in favour of RBS), in order to obtain payment of the sum which it would have obtained on the sale of Claygate if RBS had sold Ashford House and used the proceeds of sale to clear the RBS debt. Mrs Szepietowski argued that SOCA should not be allowed to marshal because (a) the 2009 Charge did not secure a debt from her to SOCA and/or (b) the provisions of the Settlement Deed and the 2009 Charge, coupled with the circumstances in which they were executed, demonstrated that marshalling was precluded. Henderson J held that SOCAs marshalling claim was well founded ([2010] EWHC 2570 (Ch)) and the Court of Appeal agreed ([2011] EWCA Civ 856). The Supreme Court unanimously allows the appeal by Mrs Szepietowski. Lord Neuberger, with whom Lord Sumption and Lord Reed agree, holds that the 2009 Charge did not create, or acknowledge the existence of, any debt from Mrs Szepietowski, or anyone else, to SOCA, save that under its terms, she was bound to pay SOCA an amount of up to 1.24m out of such sum if any, as remained from the proceeds of sale of Claygate after any prior claim had been met [40 43]. As a matter of principle, marshalling is not available to a second mortgagee where the common property does not secure a debt due from the mortgagor, but is merely available as security for whatever amount the second mortgagee can extract from that property. In such a case, there is nothing from which the right to marshal against the other property can arise [46 50]. Not least because marshalling is an equitable remedy, whether it is available in any particular case may depend on the circumstances. However, where there is no surviving debt due from the mortgagor to the second mortgagee after the sale and distribution of proceeds of sale of the common property, in the absence of express words which permit or envisage marshalling, it is hard to conceive how marshalling would be available [56 58]. If, contrary to this conclusion, marshalling is in principle available to a second mortgagee where there is no underlying debt, Mrs Szepietowskis appeal would still have been allowed. Where facts arise which potentially give rise to the right to marshal, the correct approach is to ask whether, in the perception of an objective reasonable bystander at the date of the grant of the second mortgage, taking into account (i) the terms of the second mortgage, (ii) any contract or other arrangement which gave rise to it, (iii) what passed between the parties prior to its execution, and (iv) all the admissible surrounding facts, it is reasonable to conclude that the second mortgagee was nonetheless not intended to be able to marshal [60 62]. The statutory background to, and the terms of, the 2009 Charge and of the Settlement Deed, coupled with all the surrounding circumstances demonstrate that the parties did not intend SOCA to have the right to marshal [64 72]. The fact that Ashford House was Mrs Szepietowskis home is one of the relevant background facts for that purpose, but it was insufficient on its own to prevent a right to marshal if such a right otherwise existed. Where the requirements of the right to marshal are otherwise present, it would require a contractually enforceable obligation, or something close thereto, on the first mortgagee to enforce against the common property in priority to the other property, for the second mortgagee to lose the right to marshal [73 77]. Lord Carnwath and Lord Hughes would allow the appeal on the narrower basis, namely that, read against the statutory background provided by the 2002 Act, and the fact that the 2009 Charge excluded any personal liability on the part of Mrs Szepietowski, that Charge impliedly excluded recourse to any source for payment other than those identified, and in particular excluded the right to marshal.

8k-16k

This is a case concerning the application of EU rules regarding food hygiene in relation to meat and poultry to certain chicken and pork products manufactured by the appellant, Newby Foods Ltd (Newby). Newby contends that these products should not be classified as mechanically separated meat (MSM) within point 1.14 of Annex I to EU regulation no (EC) 853/2004 of the European Parliament and of the Council laying down specific hygiene rules for food of animal origin (the Regulation). Factual and procedural background Nowadays the butchering of animal carcases in the food industry across the EU is carried out in many instances not by traditional hand butchering but by machines. These can do the job more economically, but they are less accurate than skilled human butchers. The machines often leave a significant amount of meat on the bone. For chickens, breast meat is usually removed by a somewhat different mechanical process, described below, leaving other meat on the carcase. With a view to making use of this residual meat on animal and poultry carcases, in the 1970s machines were developed that would crush the carcase bones and residual meat together under high pressure to produce, after filtering, what looks like a pure. The product of this high pressure process is one form of MSM for the purposes of the Regulation (high pressure MSM). Use of high pressure MSM for the production of food is subject to specific hygiene requirements set out in paragraph 4 of Chapter III of Section V of Annex III to the Regulation. Other processes have been developed to remove residual meat from the carcase bones under lower pressure, leaving the bones intact. The product of such low pressure processes is another form of MSM for the purposes of the Regulation (low pressure MSM). Use of this kind of MSM for the production of food is subject to different hygiene requirements, as set out in paragraph 3 of Chapter III of Section V of Annex III to the Regulation. The requirements in paragraph 3 apply to the production and use of MSM produced using techniques that do not alter the structure of the bones used in the production of MSM and the calcium content of which is not significantly higher than that of minced meat. Newby has developed a machine to remove residual meat from carcase bones. This has been used by Newby to process residual meat on beef, lamb and pork bones after the initial boning of the animal carcases (that is, after the mechanical butchery to remove the main meat from those animal carcases has taken place) and on chicken carcases after the breasts have first been removed by other mechanical processes. The Newby process has two stages. In the first stage, meat bearing bones are forced into contact with each other so that meat is removed from the bones by shearing forces. In a second stage the meat removed in this way is then passed through another machine, which is effectively a mincer, producing a product which looks like minced meat. This meat product was previously known in the United Kingdom as desinewed meat (DSM), and was regarded by many, including at one stage the Food Standards Agency (FSA), as distinct from MSM. DSM is not a category of product recognised in EU law. Under EU law important consequences flow from the classification of different products derived from meat. In particular, MSM cannot be counted towards the meat content of food and must be produced under stricter hygiene conditions, as laid down in Annex III to the Regulation. Special rules apply to the labelling of MSM under Directive 2000/13/EC of the European Parliament and of the Council of 20 March 2000 on the approximation of the laws of the member states relating to the labelling, presentation and advertising of foodstuffs (as amended by Commission Directive 2001/101/EC of 26 November 2001) (the Labelling Directive). Furthermore, the sale of MSM produced from lamb and beef bones is prohibited entirely in order to minimise the risk of the spread of Transmissible Spongiform Encephalopathies (TSE), by virtue of regulation (EC) 999/2001 of the European Parliament and of the Council of 22 May 2001 laying down rules for the prevention, control and eradication of certain transmissible encephalopathies (as amended by Commission regulation (EC) 722/2007 of 25 June 2007) (the TSE Regulation). The commercial value of MSM is less than other forms of fresh meat products, including minced meat. The issue before the court is how DSM produced using the Newby process should be classified within the scheme of this EU legislation, and in particular under the Regulation. The European Commission (the Commission) maintains that DSM should be classified as MSM. It criticised the stance originally taken by the FSA that DSM products should not be classified as MSM and threatened to take action against the United Kingdom if DSM continued to be produced and sold without regard to the restrictions imposed upon MSM. This action could have involved safeguard measures restricting the export of UK meat products to the rest of the EU. Notwithstanding the fact that it disagreed with the Commissions classification of DSM as MSM, on 4 April 2012 the FSA issued a moratorium to reflect the Commissions view regarding the effect of the relevant EU legislation (the moratorium). The moratorium had the result that DSM could no longer be produced from residual meat on beef and lamb bones and could only be produced from residual meat on chicken and pork bones if it were classified and labelled as MSM and not counted towards the meat content of products in which it was present. Newby brought judicial review proceedings challenging the moratorium, contending that it was based upon an error of law as to the definition of MSM in point 1.14 of Annex I to the Regulation (point 1.14). On 16 July 2013 Edwards Stuart J made a preliminary reference to the Court of Justice of the European Union (CJEU). He gave an extended judgment to explain the background to the case: [2013] EWHC 1966 (Admin) (the reference judgment). (Case C 453/13) judgment dated 16 October 2014 its ECLI:EU:C:2014:2297 (the CJEU judgment), the Tenth Chamber (Judges A Rosas, E Juhsz and D vby (Rapporteur)) of the CJEU made a ruling in the following terms: In Points 1.14 and 1.15 of Annex I to regulation (EC) no 853/2004 of the European Parliament and of the Council of 29 April 2004 laying down specific hygiene rules for food of animal origin must be interpreted as meaning that the product obtained by the mechanical removal of meat from flesh bearing bones after boning or from poultry carcases must be classified as mechanically separated meat within the meaning of that point 1.14, since the process used results in a loss or modification of the muscle fibre structure which is greater than that which is strictly confined to the cutting point, irrespective of the fact that the technique used does not alter the structure of the bones used. Such a product cannot be classified as a meat preparation within the meaning of that point 1.15. After this ruling, Newby abandoned its challenge to the moratorium so far as concerned the prohibition against producing DSM from residual meat on lamb and beef carcases. It is relevant to note here that sheep and cows are ruminant animals, which is a significant category for the purposes of the TSE Regulation: see below. However, Newby continued its challenge to the moratorium as regards the requirement that DSM produced from residual meat on pork and chicken carcases should be treated as MSM and labelled as such. In the resumed proceedings before the national court, Newby filed further evidence in support of its case that the pork and chicken DSM it produces should not be categorised as MSM. In a judgment of 23 March 2016 [2016] EWHC 408 (Admin) (the main judgment) Edwards Stuart J concluded that the pork and chicken meat products resulting from the first stage of the Newby process are not MSM. On this view, under the EU legislation pork and chicken DSM could be counted towards the meat content of a product, did not have to be labelled as MSM and was not subject to the special hygiene regime in paragraph 3 of Chapter III of Section V of Annex III to the Regulation. The judge also found that such DSM was not a product derived from bone scrapings, which is another category of meat product under the EU legislation. The judge granted the FSA permission to appeal to the Court of Appeal on limited grounds. On the appeal, the FSA submitted that in the main judgment the judge had erred in departing from what the FSA argued was the clear ruling in the CJEU judgment that the pork and chicken products of Newbys process are, like the lamb and beef products of that process, properly to be classified as MSM within the meaning of point 1.14. The Court of Appeal [2017] EWCA Civ 400 allowed the appeal and dismissed the challenge to the moratorium. The Court of Appeal also found that Edwards Stuart J had been entitled to find that pork and chicken DSM is not a product derived from bone scrapings for the purposes of the EU legislation. Newby now appeals to this court in relation to the decision of the Court of Appeal regarding the proper interpretation of point 1.14. Regulation no 853/2004 The recitals to the Regulation include the following: Whereas: (2) Certain foodstuffs may present specific hazards to human health, requiring the setting of specific hygiene rules. This is particularly the case for food of animal origin, in which microbiological and chemical hazards have frequently been reported. (9) The principal objectives of the recasting are to secure a high level of consumer protection with regard to food safety, in particular by making food business operators throughout the Article 2(3) of the Regulation provides that the definitions in Annex I to the Regulation shall apply. Paragraph 1 of Annex I is headed Meat and sets out various definitions relevant to that topic, including as follows: Community subject to the same rules, and to ensure the proper functioning of the internal market in products of animal origin, thus contributing to the achievement of the objectives of the common agricultural policy. (20) The definition of mechanically separated meat (MSM) should be a generic one covering all methods of mechanical separation. Rapid technological developments in this area mean that a flexible definition is appropriate. The technical requirements for MSM should differ, however, depending on a risk assessment of the product resulting from different methods. 1.1 Meat means edible parts of the animals referred to in points 1.2 to 1.8, including blood. [cows, sheep and pigs fall within the scope of point 1.2 and farmed chickens are poultry within the scope of point 1.3] 1.9 and dressing. 1.10 Fresh meat means meat that has not undergone any preserving process other than chilling, freezing or quick freezing, including meat that is vacuum wrapped or wrapped in a controlled atmosphere. Carcase means the body of an animal after slaughter 1.13 Minced meat means boned meat that has been minced into fragments and contains less than 1% salt. 1.14 Mechanically separated meat or MSM means the product obtained by removing meat from flesh bearing bones after boning or from poultry carcases, using mechanical means resulting in the loss or modification of the muscle fibre structure. 1.15 Meat preparations means fresh meat, including meat that has been reduced to fragments, which has had foodstuffs, seasonings or additives added to it or which has undergone processes insufficient to modify the internal muscle fibre structure of the meat and thus to eliminate the characteristics of fresh meat. In the EU legislation, no definition is given of boning in relation to cow, pig and sheep carcases. It is common ground that this term refers to the initial process of removal of meat from a carcase. As regards the carcases of cows, pigs and sheep, the definition of MSM in point 1.14 refers to removal of the meat left on the bones of those animals after the initial phase of butchering has taken place (typically, as described above, this initial butchering is by mechanical means): ie what I have called the residual meat. As regards the carcases of poultry, the definition of MSM in point 1.14 simply refers to removal of meat from those carcases (ie from the whole body of the bird: see point 1.9), without referring to any previous process of boning or removal of meat from the bird. The reference judgment In his judgment accompanying the reference to the CJEU, Edwards Stuart J set out relevant findings and expressed his provisional conclusions. He emphasised that the DSM produced by Newbys process was very different in texture and appearance from high pressure MSM, which is nothing like fresh meat. However, he was satisfied that the muscle fibre structure of that DSM underwent some modification during the process. Accordingly, therefore, as he put it, if it is sufficient for it to be classified as MSM that there has been any modification of the muscle fibre structure, then it is MSM (para 60, emphasis in original). The position of the FSA, reflecting the view of the Commission, was that any such modification was sufficient to mean that the residual meat removed by the Newby process is MSM. The submission of Newby was that something more, in the form of significant modification of the muscle fibre structure of the meat so removed, was required before the product of that process fell to be classified as MSM. Newby relied on analysis by microscopy by experts to maintain that the modification of muscle fibre in the residual meat removed by stage one of its process was not at a significant level such that it became MSM, and submitted that stage two of the process was simply equivalent to mincing of the meat so recovered. The judge referred, at para 61, to the wording of point 1.15 of Annex I to the Regulation. In his view the words and thus to in that provision indicated that there had to be a causal link between the loss or modification of the muscle fibre structure and the elimination of the characteristics of fresh meat. Furthermore, he did not consider that this wording could be construed to mean that any diminution, however minor, of those characteristics amounts to elimination of those characteristics. It seemed to the judge that there had to be at least a significant diminution in those characteristics before they could be said to be eliminated. He considered that in this context the relevant characteristics of fresh meat are its organoleptic properties including its taste, smell and texture. The judge also referred, at paras 62 63, to an alleged inconsistency in the approach to the application of the Regulation by the Commission and by the FSA in its moratorium, as regards the treatment of chicken breasts removed from poultry carcases. According to Newbys submission, as recorded by the judge, chicken breasts are commonly removed from the carcass by mechanical means and this inevitably causes some modification of the muscle fibre structure at the point where the meat is cut, which on the approach of the Commission and the FSA to point 1.14 would appear to mean that meat removed by that process would fall within the definition of MSM; yet according to the position of the Commission in its dealings with national authorities, chicken breast meat produced in this way was properly to be categorised as fresh meat for the purposes of the Regulation, and not as MSM. Newby cited this as an example of the absurd consequences that it maintained would follow if any damage to the muscle fibre structure were to lead to the meat product in question being classified as MSM. In the alternative, Newby submitted that it demonstrated an inconsistency of the application of the Regulation. The judge stated, at para 64, that he was satisfied on the evidence before him that the product of Newbys two stage process had not resulted in the elimination of the characteristics of fresh meat. Furthermore, he did not consider that there had been a sufficient diminution of those characteristics to prevent the product falling within the definition of meat preparations in point 1.15 of Annex I. Accordingly, the judges provisional conclusion was that the DSM produced by Newbys process did not fall to be classified as MSM. However, the position was not acte clair, so the judge made a preliminary reference to the CJEU, asking the following questions: i) Do the words loss or modification of the muscle fibre structure in point 1.14 of Annex I to regulation no 853/2004 mean any loss or modification of the muscle fibre structure that is visible using standard techniques of microscopy? ii) Can a meat product be classified as a meat preparation within point 1.15 of Annex I where there has been some loss or modification of its muscle fibre structure that is visible using standard techniques of microscopy? iii) If the answer to [the first question] is no and the answer to [the second question] is yes, is the degree of loss or modification of the muscle fibre structure that is sufficient to require each product to be classified as MSM within point 1.14 of Annex I the same as that required to eliminate the characteristics of fresh meat within point 1.15 of that annex? iv) To what extent must the characteristics of fresh meat have been diminished before they can be said to have been eliminated within the meaning of point 1.15? v) If the answer to [the first question] is no, but the answer to [the third question] is also no, what degree of modification to the muscle fibre structure is required in order for the product in question to be classified as MSM? vi) On the same assumption, what criteria should be used by national courts in determining whether or not the muscle fibre structure of the meat has been modified by that degree? The CJEU judgment The CJEU proceeded to a judgment without the benefit of an Advocate Generals opinion or, despite an application by Newby, an oral hearing. It delivered its judgment on 16 October 2014. The CJEU set out the following factual account, which is not controversial: 21. The referring court states that Newby Foods has developed a machine which is capable of removing the residual meat attached to the bones after the main part of the meat had been removed from them, without crushing those bones or liquefying the residual tissues. That machine, which operates essentially by means of shearing, can be distinguished from those operating at high pressure, which turn the residual tissues into a viscous paste. The resulting product, which, at the end of the first production stage, passes through a perforated plate with 10mm diameter apertures, is then processed in another machine which minces it by making it pass through a filter with 3mm diameter apertures. This product, which looks like ordinary minced meat, is marketed in the United Kingdom as desinewed meat. As regards its appearance, that product is clearly distinguishable from mechanically separated meat obtained at high pressure. According to the applicant in the main proceedings, no one would classify the product obtained by means of its machine as anything other than meat. 22. Also according to the applicant in the main proceedings, the desinewed meat which it produces contains only very rarely particles of bones, bone skin or bone marrow; however, the presence of occasional shards of bone cannot be excluded. In the proceedings before the CJEU, Newby was supported by the United Kingdom government (presenting the view of the FSA) in its submissions against the view of the Commission regarding the proper interpretation of point 1.14. The CJEU summarised the key submission of Newby, as supported by the FSA, at para 23 as follows: According to the applicant in the main proceedings and the FSA, by reference to the documents mentioned in paras 18 and 19 of the present judgment, the product obtained by means of that process does not correspond to the definition of mechanically separated meat within the meaning of regulation no 853/2004, in the absence of significant loss or modification of the muscle fibre structure, that is to say, in the absence of a change which is sufficient to eliminate the characteristics of fresh meat. That product should rather be classified as meat preparations within the meaning of point 1.15 of Annex I to that regulation. The CJEU reformulated the questions referred, at para 40: By its questions, which it is appropriate to examine together, the referring court is essentially asking whether points 1.14 and The CJEU addressed the reformulated questions in the following way at paras 41 to 43: 1.15 of Annex I to regulation no 853/2004, which contain the definitions of the concepts of mechanically separated meat and meat preparations respectively, must be interpreted as meaning that the product obtained by the mechanical removal of meat from flesh bearing bones after boning or from poultry carcases must be classified as mechanically separated meat within the meaning of that point 1.14 only where the process used results in a loss or modification of the muscle fibre structure which is significant, while the classification as meat preparations within the meaning of point 1.15 must be chosen where that loss or modification is not significant. Secondarily, in the event that that interpretation should prevail, the referring court seeks to ascertain what degree of modification or loss is required for that modification or loss to have to be regarded as significant and what process should be used in order to determine whether the degree thus required has been attained. 41. It must be stated at the outset that the definition of the concept of mechanically separated meat set out in point 1.14 of Annex I to regulation no 853/2004 is based on three cumulative criteria which must be read in conjunction with one another, namely (i) the use of bones from which the intact muscles have already been detached, or of poultry carcases, to which meat remains attached, (ii) the use of methods of mechanical separation to recover that meat, and (iii) the loss or modification of the muscle fibre structure of the meat thus recovered by reason of the use of those processes. In particular, that definition does not make any distinction as regards the degree of loss or modification of the muscle fibre structure, with the result that any loss or modification of that structure is taken into consideration within the context of that definition. 42. Consequently, any meat product which satisfies those three criteria must be classified as mechanically separated meat, irrespective of the degree of loss or modification of the muscle fibre structure, in so far as, by reason of the process used, that loss or modification is greater than that which is strictly confined to the cutting point. 43. In the case of use of mechanical processes, that third criterion allows mechanically separated meat within the meaning of point 1.14 of Annex I to regulation no 853/2004 to be distinguished from the product obtained by cutting intact muscles; the latter product does not show a more general loss or modification of the muscle fibre structure, but reveals a loss or modification of the muscle fibre structure which is strictly confined to the cutting point. Consequently, chicken breasts which are detached from the carcase of the animal by mechanically operated cutting rightly do not constitute mechanically separated meat. At paras 44 to 48 the CJEU stated that, as regards the products which meet the criteria for MSM, the Regulation did not make any distinction other than that stemming from paragraphs 3 and 4 of Chapter III of Section V of Annex III to the Regulation, which drew the distinction between low pressure MSM and high pressure MSM referred to above. At para 46, referring to low pressure MSM, the CJEU said: This type of product, which corresponds to mechanically separated meat obtained at low pressure, like the product at issue in the main proceedings, may, by way of exception, be used in certain meat preparations within the meaning of point 1.15 of Annex I to regulation no 853/2004, namely those intended to undergo heat treatment prior to consumption, whereas, in accordance with the definition given in point 1.15, meat preparations may in principle be obtained only from fresh meat, possibly minced into fragments that is to say, meat deriving from intact muscles to the exclusion of bone scrapings. The same type of product may also be used in all of the meat products within the meaning of point 7.1 of that annex. Having referred, by way of contrast, to high pressure MSM at para 47, the CJEU stated at para 48 that the distinction between different types of MSM made in paragraphs 3 and 4 of Chapter III of Section V of Annex III was reflected in the definition of MSM in point 1.14, with the word modification being intended to refer to MSM produced by use of methods of mechanical separation operating at low pressure. The CJEU went on: 49. That scheme, which consists in the arrangement of all mechanically separated meat into a single category subdivided into two subcategories of products which present different health risks and may consequently be intended for different uses, is explained in recital 20 in the preamble to regulation no 853/2004, which was also inserted at the same stage of the drafting of that Regulation. That recital announces, for that category of products, (i) a generic definition stated in flexible terms in such a way as to cover all methods of mechanical separation and to remain appropriate notwithstanding the rapid technological developments in that area, and (ii) technical requirements which differ depending on a risk assessment of the product resulting from different methods. 50. That recital, which clarifies perfectly the EU legislatures intentions, adequately demonstrates that the EU legislature took into consideration from the outset the possibility that new low pressure methods for the production of mechanically separated meat might be developed, such as, as the case may be, that used by the applicant in the main proceedings, assuming that that process demonstrates some innovation vis vis methods using techniques which do not alter the structure of the bones used, of which the EU legislature was aware at the time when regulation no 853/2004 was drafted. At paras 51 to 54 of its judgment the CJEU compared and contrasted the definition of MSM in point 1.14 and meat preparation in point 1.15 of Annex I to the Regulation. At para 52 it said that classification as meat preparations within point 1.15 of products which, like that at issue in the main proceedings, satisfy the criteria for [MSM] is excluded by the definition there set out. At para 53 it noted that the production of MSM involved neither of the processes referred to in point 1.15, namely the addition of foodstuffs, seasoning or additives or processing within the meaning of article 2(1)(m) of regulation no 852/2004; it stated that: on the contrary, a product such as that at issue in the main proceedings corresponds to the notion of an unprocessed product within the meaning of article 2(1)(n) of that Regulation. The CJEU further noted that the concept of meat preparations has a direct link not with MSM but, rather, with the concepts of fresh meat and minced meat which are, in principle, the only usable raw material, and secondly, with the concept of meat products within point 7.1 of Annex I to the Regulation. It then stated: 55. In addition, as the French Government suggests, a classification of products, such as that at issue in the main proceedings, as fresh meat within the meaning of point 1.10 of Annex I to regulation no 853/2004 is also excluded. Disregarding their other characteristics, such products consisting in fragmented meat would be capable of coming only within the concept of minced meat within the meaning of point 1.13 of that annex, a concept from which they must, however, be excluded by reason of point 1(c)(iv) of Chapter II of Section V of Annex III to that Regulation as products obtained from bone scrapings. At paras 56 and following the CJEU pointed out, further, that a classification of products as MSM had significant consequences with reference to the TSE Regulation and the Labelling Directive. As regards the TSE Regulation, at paras 57 to 59 the CJEU noted that according to that Regulation an industrial method which produces MSM within the meaning of point 1.14 cannot be used for the processing of bovine, ovine and caprine raw material; that Contrary to the view advanced in this regard by the applicant in the main proceedings, the application of that classification [ie as MSM] to products such as that at issue in the main proceedings in order to conclude that their production from raw material obtained from ruminants is prohibited follows from the implementation of the intention expressed in clear terms by the EU legislature within the context of the measures adopted with a view to combatting those diseases (para 58); that it is apparent from recital 11b to the TSE Regulation that the EU legislature had particularly in mind the fact that MSM could contain portions of bones and of the periosteum; and that it followed from the reference judgment that the same applies in the case of a product such as that produced by [Newby] (para 59). As regards the Labelling Directive, at paras 60 to 66 the CJEU noted that in accordance with Annex I to that directive the classification of a product as MSM within the meaning of point 1.14 implies a prohibition on labelling the product as meat rather than as MSM; an important objective of that directive is to ensure that labelling should not be such as could mislead a purchaser; the provisions of that directive and recitals 1 and 7 to Directive 2001/101 indicate that MSM, which differs significantly from meat as perceived by consumers, must be excluded from the scope of that concept for the purposes of labelling and presentation; those recitals express the findings that although MSM is technically fit for human consumption in so far as it is not obtained from ruminants, it is none the less a product of inferior quality because it consists of residual meat, fat and connective tissue which remain attached to the bones after the main part of the meat has been removed (para 63); and that to interpret the EU legislation so as to allow a product such as [Newby] produces, having an appearance comparable to minced meat, such that it could not easily be differentiated by consumers from minced meat derived from better quality meat, would defeat this intended objective of the Labelling Directive and another of its objectives, namely to prevent differences in the labelling of foodstuffs which might impede the free circulation of those products and lead to unequal conditions of competition. The CJEU expressed its conclusion at para 67 in terms reflected in the dispositif set out at para 9 above. The main judgment in the national court As set out above, when the case returned to the national court for further hearing, Newby dropped its challenge to the moratorium in so far as it covered the products of its process as applied to lamb and beef carcases. Newby maintained its challenge to the moratorium as regards its application to its process as applied to pork and chicken carcases. The further hearing took place on 9 and 10 February 2016. Newby filed additional evidence for this hearing. According to the evidence before the judge, the Newby process was applied to pork meat left on bones after the initial stage of butchery of the carcase (ie after the de boning phase) and to chicken meat left on chicken carcases after an initial stage of removal of the chicken breasts by a different mechanical process, involving scraping the chicken breasts cleanly from the breast bone. The further evidence about treatment of chicken carcases also indicated that before chicken breasts were removed in this way, the wishbone would be cut out of the meat. There was some evidence to suggest that certain methods of butchering pork carcases might leave some fully intact muscles in place after the initial phase of cutting meat from the carcase. In his main judgment, handed down on 23 March 2016, Edwards Stuart J correctly observed that it was clear from the judgment of the CJEU that it considered that the product of the first stage of Newbys process should be classified as MSM. However, Newby submitted that in the light of the CJEUs interpretation of point 1.14 this was not an available conclusion on the facts, and that it was for the national court to establish the facts and apply the guidance given by the CJEU to those facts. The judge rejected a submission on behalf of Newby that since what is fed into Newbys machine consists of bones with a fairly substantial amount of meat attached it does not consist of bones from which the intact muscles have been detached and accordingly did not satisfy the first criterion for MSM formulated by the CJEU at para 41 of its judgment. The judge observed that if this submission were correct even a high pressure process of crushing the meat and bones to a slurry would not be capable of producing MSM. Newby now accepts that the judge was right about this and that the first criterion for MSM set out by the CJEU is satisfied in relation to the products of its process. It was and is common ground that the second criterion for MSM, namely the use of mechanical separation to recover the residual meat left on the bones or poultry carcases, is satisfied in relation to the products of Newbys process. There is an extended discussion in the main judgment at paras 66 to 85 regarding the third criterion for MSM set out in para 41 of the judgment of the CJEU and the discussion at paras 42 and 43 concerning the cutting point. The judge correctly recognised that the CJEU in its judgment had interpreted the EU legislation with a view to achieving clarity in the application of point 1.14 rather than making it depend on case by case assessment by microscopic examination of muscle fibres, but said that by introducing the cutting point explanation in doing so, it may have thrown the baby out with the bath water. The CJEU had provided no elaboration of what was meant by the cutting point in the context of Newbys process. Cutting in this context must mean severance or separation (at para 66). The judge identified two principal possible readings of what the CJEU meant by cutting point: (i) on a narrower reading, it refers to the cutting of intact muscles, or (ii) on a more expansive reading, it refers to the points at which the meat has been severed or separated during the process of recovering it. The FSA, in line with the position of the Commission, submitted that the narrower reading at (i) is correct, and that since the meat recovered by the Newby process was taken after the original cutting of intact muscles during the initial de boning phase (in relation to pork) or after the initial phase of removal of chicken breasts in the case of chicken carcases, it followed that this recovered meat should be categorised as MSM. Newby, on the other hand, submitted that the more expansive reading at (ii) is correct; that microscopic examination of the strips of meat produced after the first stage of its process showed that the muscle fibre structure was only affected at the points where they had been removed from the bones or separated from other pieces of meat in the initial phase of removal of meat from a carcase or in the shearing involved in Newbys process; that therefore modification of the muscle fibre structure was strictly confined to the cutting points as so understood; and that accordingly this recovered meat did not meet the third criterion for MSM as laid down by the CJEU at para 41 of its judgment, as explained at paras 42 and 43. As the domestic court had further and better evidence regarding the state of the meat strips produced in the first stage of the Newby process than had been available to the CJEU, the domestic court should interpret the CJEUs judgment and apply it to the facts as appeared from that evidence. The judge accepted the submission by Newby, holding that the expansive reading of the notion of the cutting edge at (ii) above is correct. According to him, the cutting point of the muscle fibre produced by the first stage of the Newby process refers to every severed edge of the pieces of flesh that emerge from that process: para 85. Since, on the evidence before him, it was only at the cutting points in this sense that there was modification of the muscle fibre structure of the strips of meat produced at the first stage of the Newby process, this meat did not fall to be categorised as MSM. This appeared to mean that the product of this stage of the Newby process could be used in the second stage of that process to prepare what could be classified under the Regulation as minced meat and labelled and sold as such, although the judge expressed no final positive view to that effect: see paras 86 94. In the course of his discussion the judge found on the evidence that the product of the first stage of the Newby process could not be regarded as bone scrapings, contrary to the view of the CJEU at para 55 of its judgment. In due course, the Court of Appeal held that this was a legitimate finding which was open to him to make, and there is no cross appeal to this court regarding this point. In reaching his view regarding the interpretation of the notion of the cutting point, as used by the CJEU, the judge accepted the submission of Mr Mercer that he should have regard to article 11 of the Treaty on the Functioning of the European Union (TFEU). Article 11 TFEU provides that environmental protection requirements must be integrated into the definition and implementation of the EUs policies and activities, in particular with a view to promoting sustainable development. The judge agreed that he should interpret point 1.14 and paras 41 and 42 of the CJEUs judgment in a manner which promotes environmental protection rather than undermines it. According to the judge, on Newbys proposed interpretation of the CJEUs judgment there would be less wastage of meat suitable for human consumption and so fewer pigs would have to be raised and slaughtered. The judge also referred to the further evidence regarding removal of wishbones before chicken breasts were scraped from chicken carcases by mechanical processes, which Mr Mercer submitted meant that chicken breasts were not intact muscles at the point they were removed from chicken carcases: para 76. The judge said that he was not in a position to find whether or not Mr Mercers assertions about the process of removal of the wishbone were correct, but observed that it would be an absurdity if the prior removal of the wishbone section of the breast condemned the remainder of the breast to being classed as MSM, which would be avoided on his preferred reading of what the CJEU meant by the cutting edge: para 77. The judge did not make further mention here of the fact that, as noted by him in the reference judgment, the Commission took the view that mechanically removed chicken breasts do not fall to be categorised as MSM, but as fresh meat. As appears from correspondence in evidence, that does in fact continue to be the Commissions view. The judgment of the Court of Appeal The Court of Appeal allowed the appeal by the FSA in relation to the question whether the product of the first stage of Newbys process should be categorised as MSM. The court held that the judgment of the CJEU made it clear that it should be so categorised. The court therefore dismissed Newbys judicial review challenge to the moratorium, as it applied in relation to the application of its process to produce pork and chicken meat. The lead judgment was delivered by Lloyd Jones LJ (as he then was), with whom Beatson and Moylan LJJ agreed. Lloyd Jones LJ subjected paras 41 to 43 of the judgment of the CJEU to careful analysis. At para 41 the CJEU had given a clear answer adverse to Newbys principal submission on the reference. In his view, the qualification to the category of MSM as defined in point 1.14 introduced by the CJEU in paras 42 and 43 of its judgment by reference to the notion of the cutting point was directed to answering the argument of Newby that the mechanical removal of chicken breasts from a chicken carcase would necessarily involve a loss or modification of muscle fibre structure at the point where the breast was cut away with the result that, on the Commissions interpretation of point 1.14, all mechanically separated chicken breasts would have to be classified as MSM. On Lloyd Jones LJs reading of the CJEUs judgment, that qualification is limited to the cutting of intact muscles: para 39. He set out his reasoning as follows: 40. First, this is apparent from other passages in the judgment. At para 41 the courts paraphrase of [point] 1.14 emphasises in the case of the first criterion the use of bones from which the intact muscles have already been cut. At para 43 the court states in terms that the third criterion allows MSM to be distinguished from the product obtained by cutting intact muscles, explaining that the latter product reveals a loss or modification of the muscle fibre structure which is strictly confined to the cutting point. It then goes on to state in terms that chicken breasts detached from the carcase by mechanically operated cutting rightly do not constitute MSM. There is a further reference to the removal of intact muscles from bones at para 45. Secondly, if the cutting point exception were given the wide reading for which Newby contends it would exclude from classification as MSM products made by repeated mechanical cutting of meat left on bones or carcases from which intact muscles had previously been removed. The only loss or modification of the muscle fibre structure in such a case would be at the cutting points, however numerous they were. That would, in my view, defeat the purpose of the classification. Thirdly, the paragraphs of the judgment of the CJEU in which it applies the principle to the particular facts of this case demonstrate that the court cannot have intended the cutting point exception to bear such a wide meaning. I am, therefore, unable to agree with the judges broad 41. interpretation of the qualification as referring to every severed edge of the pieces of flesh that emerge from the Newby process. The qualification relates to cutting intact muscles from the animal. In the case of the Newby process, the product is not obtained by cutting intact muscles but by cutting or otherwise removing the meat left on the carcase after the intact muscle has been removed. Mechanical separation of residual meat from bones produces separation, shearing or cutting and hence modification to the muscle fibre structure at other points in addition to the point from which the intact muscles have been removed. The CJEU concluded as a matter of principle that meat which is mechanically separated from bones from which the intact muscles have already been detached shows a more general loss or modification of muscle fibre structure beyond the cutting point. 42. I have referred earlier to the fact that when the matter returned to the referring court it was submitted on behalf of Newby that since the bones fed into the machine for the first stage of the Newby process had substantial amounts of meat attached, the Newby process did not satisfy the first of the criteria identified by the CJEU ie it was said that it did not involve the use of bones from which the intact muscles have already been detached or poultry carcases, to which meat remains attached. The judge rejected that argument, correctly in my view, on the ground that if that were correct even a high pressure process of crushing such meat and bones to a slurry would be incapable of producing MSM. As Mr Coppel points out, it must follow that the product of Newbys process is not obtained by cutting intact muscles. The intact muscles have already been detached from the bones. In the case of chicken carcases the requirement that intact muscles have already been detached does not apply. It seems to me that this explains why the CJEU had to address the question of the cutting point in the context of the three limbs of the definition of MSM. I should add that to the extent that there may be an intact muscle left on a chicken carcase after removal of the breast or on a pork bone after the removal of the prime cuts of pork, it may well be that the process would involve the cutting of intact muscles within the qualification created by the CJEU. However, the product of the first stage of the Newby process would still in part comprise MSM and the entire product would have to be classified as MSM. 43. In coming to his conclusion the judge referred to the need to have regard to article 11 TFEU and to interpret point 1.14 of the Regulation and paras 41 and 42 of the judgment of the CJEU in a manner that promotes environmental protection rather than undermines it. He thought this a powerful point. He considered that to treat DSM produced by Newby as MSM was to waste a product that the informed observer would regard as meat, albeit not of the best quality. He stated that there was an environmental cost for treating this product as MSM. More pigs would have to be raised, slaughtered and butchered in order to make up the shortfall. He considered this contrary to the objective of promoting sustainable development. While this might be an appropriate factor to take into account in interpreting an EU measure in other circumstances, there is no scope for such an approach here. The CJEU was made aware of the argument that classifying Newbys products as MSM was a waste of good meat. Nevertheless it attached no weight to that consideration. The intention of the CJEU is clear. Moreover, the preamble to the Regulation (recital 9) makes clear that the principal objective of the classification is to secure a high level of consumer protection with regard to food safety. The reading favoured by the judge would undermine that objective. Lloyd Jones LJ recognised that in a case involving a reference to the CJEU on a point of interpretation of EU law it is for the national court to find the relevant facts and to apply the law as stated by the CJEU to those facts once found, as explained in Revenue and Customs Comrs v Aimia Coalition Loyalty UK Ltd [2013] UKSC 15; [2013] 2 CMLR 51, para 54 per Lord Reed. However, Lloyd Jones LJ did not accept that there had been any material change in the factual picture given by the further evidence adduced by Newby as compared to that available to the CJEU when it delivered its judgment; according to him, the statement of law set out in paras 41 to 43 of the judgment of the CJEU was conclusive of the dispute regarding the lawfulness of the FSAs moratorium and left no scope for argument as to the application of the law to the facts: para 50. Although Lloyd Jones LJ noted at para 30 the observations of Edwards Stuart J at paras 76 77 in the main judgment regarding Mr Mercers submissions about the significance of the cutting of wishbones from chicken carcases before the removal of chicken breasts, the Lord Justice did not revert to this point in his analysis when allowing the FSAs appeal. The appeal to this court For the appeal to the Supreme Court, the court gave permission for interventions by way of written submissions on behalf of the National Farmers Union and also on behalf of the Association of Independent Meat Suppliers, the British Meat Processors Association and the British Poultry Council. They all supported the case for Newby. In their application to intervene, dated 14 August 2018, the last three interveners also indicated that they wished to adduce further evidence, but did not file such evidence with their application. The question of the admission of such further evidence was postponed to the hearing of the appeal. The further evidence which was eventually filed and served comprised witness statements from a representative of each of those organisations, being a statement of Norman Bagley dated 5 January 2019, a statement of Nicholas Allen dated 4 January 2019 and a statement of Richard Griffiths dated 4 January 2019, respectively. The statements of Mr Bagley and Mr Allen provided additional information regarding pork production and current trends regarding automation in meat production and canvassed concerns of members of the meat industry regarding possible implications of the judgment of the Court of Appeal for that industry. The statement of Mr Griffiths provided an overview of poultry production and additional detail regarding the processes by which meat is removed from chicken carcases. The FSA objected to the admission of this further evidence so late in the day. The court read the new witness statements in advance of the hearing on a de bene esse basis and viewed certain video material referred to in the statements on the same basis. Having heard the application to adduce this new evidence and the opposing submissions, the court refuses permission to admit it in the appeal. It would be unfair to the FSA for the evidence to be admitted so late in the day. The way in which the Second to Fourth Interveners went about attempting to introduce the further evidence on the appeal to this court was very unsatisfactory. They should have made the fresh evidence available at the time of their application to intervene and to adduce further evidence (that is, in August 2018), in good time before the hearing and the filing of printed cases by the parties to the appeal. In that way the court could have determined well in advance of the preparation of printed cases by the parties to the appeal and well before the hearing whether fresh evidence was or was not to be admitted for consideration on the hearing of the appeal. Instead, the Second to Fourth Interveners only filed the fresh evidence after Newbys printed case was filed on 19 December 2018 and just days before the FSA filed its printed case on 9 January 2019. The FSA did not have a fair opportunity to take this fresh evidence into account in preparing its printed case, let alone to respond to it by seeking to file further evidence itself. Furthermore, now that the appeal has been heard, it is clear that it turns on issues of law and that the fresh evidence could have no relevant bearing on the outcome of the proceedings. I turn to the merits of the appeal. In my judgment the appeal should be dismissed, essentially for the reasons given by the Court of Appeal. The Court of Appeal has correctly understood the judgment of the CJEU and was right to adopt the narrow reading it did of the notion of the cutting point as used by the CJEU. On this appeal the focus has been on the proper characterisation of the products of the Newby process after stage one, which take the form of strips of meat removed from bones. It is now common ground that these products meet the first two criteria for categorisation of MSM for the purposes of point 1.14 as set out by the CJEU at para 41 of its judgment. The issue, therefore, is whether these products meet the third criterion (ie are characterised by the loss or modification of the muscle fibre structure of the meat recovered by use of methods of mechanical separation), in light of the qualification regarding that criterion introduced by the CJEU in paras 42 and 43. In my view, Newbys products satisfy the third criterion for classification as MSM, as the Court of Appeal correctly held. This is clear from the answer the CJEU gave at para 41 to the referred questions as summarised in para 40; from the language which it used in its discussion of the cutting point qualification and elsewhere in its judgment; from the clear and repeated statements it made that Newbys products should be categorised as MSM; and from the wider contextual factors derived from other parts of the EU legislative regime on which the CJEU relied as supporting its interpretation of point 1.14. To begin with, the way in which the CJEU formulated the first criterion for classification as MSM in para 41 of its judgment is significant: the use of bones from which the intact muscles have already been detached, or of poultry carcases, to which meat remains attached. This is the CJEUs paraphrase of the following words in point 1.14: removing meat from flesh bearing bones after boning or from poultry carcases. As regards animals other than poultry, according to point 1.14, the first criterion for MSM is only satisfied after the carcases have been through a process of boning. This is not a term used in relation to poultry carcases. In its formulation, however, the CJEU has given its interpretation of the concept of boning as the detachment of intact muscles from the carcase, which is to say in the initial act of removal of meat from the carcase. This is also reflected in its description in para 63 of the meat used for MSM as residual meat, fat and connective tissue which remain attached to the bones after the main part of the meat has been removed. This notion of residual meat after the main part of the meat has been removed from a carcase appears equally apt in respect of chicken carcases after the removal of the breasts by the usual simple mechanical processes used in the industry. The CJEUs formulation of the first criterion indicates that this is its view. It speaks of meat remaining attached to poultry carcases, rather than simply referring to poultry carcases, which would include all the meat on the carcase. In other words, by its formulation of the first criterion, the CJEU had already commenced the analysis, amplified in paras 42 and 43 of its judgment, by which it equates the initial removal of meat from animal carcases with the initial removal of chicken breasts from chicken carcases. Functionally, they are equivalent processes and the CJEU treats them as such. This reading of the CJEUs judgment is not compatible with Newbys submissions as to what the CJEU meant. In the last sentence of para 41 of its judgment, the CJEU gave a clear answer to the principal issue raised by the national court by its questions in the reference judgment. The concept of mechanically separated meat does not depend upon it being established that the process referred to in point 1.14 results in a loss or modification of the muscle fibre structure which is significant (see the terms of the question posed on the reference as formulated by the CJEU in para 40). This was, of course, an outright rejection of Newbys submission as to the proper interpretation of point 1.14. In para 42 the CJEU reiterated the point that the definition of MSM does not depend upon an analysis of the degree of loss or modification of the muscle fibre structure removed by the Newby process or equivalent processes. Instead, the CJEU held that a much clearer line of demarcation applies. Meat removed from a carcase will not be MSM if it is removed by mechanical means in the first phase of cutting meat from the whole carcase, but will generally be MSM if it is removed by mechanical means thereafter. For animals other than poultry, this is explained by the focus on the prior detachment of the intact muscles as the critical aspect of the first criterion for MSM in para 41, together with the CJEUs emphasis in para 42 that to escape categorisation as MSM any loss or modification of muscle fibre structure must be strictly confined to the cutting point. It is straightforward to know whether a carcase has gone through the initial phase of having meat cut from it, and there is no requirement for refined processes of microscopic investigation to be applied. In the first sentence of para 43 of its judgment, the CJEU emphasised that this is the proper interpretation of point 1.14. Again, it explains that on its interpretation of point 1.14 there is a clear distinction to be drawn between the product obtained by cutting intact muscles, which involves loss or modification of the muscle fibre structure which is strictly confined to the cutting point, and MSM. This is the context for the courts statement, Consequently, chicken breasts which are detached from the carcase of the animal by mechanically operated cutting rightly do not constitute mechanically separated meat. It is clear that initial removal of chicken breasts from chicken carcases is, in the CJEUs analysis, equated with the initial removal of meat by mechanically operated cutting in relation to other animal carcases. That is all that the CJEU meant to say. The point of this statement about chicken breasts in para 43 was, as the Court of Appeal rightly observed, to deal with the argument by Newby (referred to at para 37 of the CJEUs judgment) that the Commissions position in opposition to Newbys case was inconsistent, because the Commission treated chicken breasts removed by mechanical means as falling outside the definition of MSM. In giving the explanation in para 43, the CJEU was clearly not intending to undermine the clear and unequivocal answer it had given in para 41 to the referred questions, which answer has the consequence that the products of Newbys process have to be classified as MSM. Contrary to the view of Edwards Stuart J, the CJEU was not throwing the baby out with the bathwater by stating an exception to the clear general rule it had declared in para 41, which exception would have the effect of wholly undermining that rule. With respect to the judge, that is not a plausible interpretation of the CJEUs judgment. In describing what happens with the mechanical removal of chicken breasts the CJEU used the word cutting, whereas the later evidence adduced by Newby for the resumed proceedings in the national court shows that what happens is a combination of cutting at the edge of the chicken breasts before they are scraped as whole muscles from the breast bone. However, this is not a significant point. The CJEU used the term cutting because that was how Newby described the process in its submissions to the CJEU (as summarised at para 37 of the CJEUs judgment) and the way in which the national court described the process in the reference judgment at para 62. On any view the process for removal of chicken breasts by mechanical means is very different from Newbys process for removing residual meat from animal bones and chicken carcases, as the CJEU correctly understood. The fuller evidence now available regarding the details of the mechanical process for removal of chicken breasts does not undermine or otherwise call in question the interpretation of point 1.14 given by the CJEU, which is a matter of law. Mr Mercer pointed out that, according to the evidence, it occasionally happens that chicken carcases will be subjected to Newbys process without the breasts first being removed. However, this does not affect the legal analysis. Newbys process is different from, and very much less targeted than, the mechanical processes used to remove breasts from chicken carcases. It does not remove them as whole muscles, but subjects them to chopping through the use of shearing forces. Mr Mercer also pointed to evidence adduced in the resumed proceedings before the national court that, in the process of removing chicken breasts whole by mechanical means, the wishbone is usually cut out of the breast meat before such removal. He sought to suggest that this evidence undermined the CJEUs analysis in paras 41 to 43 of its judgment, since the breast muscle of a chicken will have been subjected to cutting before it is removed from the carcase by mechanical means and so should be classified as MSM according to the CJEUs interpretation of point 1.14. This would be contrary to the CJEUs statement in para 43 that chicken breasts removed by mechanical means do not constitute MSM. Again, however, this evidence regarding what happens in the case of mechanical removal of chicken breasts does not undermine or otherwise call in question the clear answer given by the CJEU as a matter of law in respect of the application of point 1.14 as regards the products of Newbys process. Furthermore, no legal dispute has arisen regarding the categorisation of chicken breasts removed by mechanical means. Neither the Commission nor the FSA has sought to categorise them as MSM. Mr Mercer says that there are ways of removing meat from a pork carcase at the initial stage which leave intact muscles on the carcase which are removed at a later stage. The Court of Appeal referred to this possibility at para 42 of its judgment. Once again, this does not affect the interpretation of point 1.14 given by the CJEU, which clearly does cover the products of Newbys process. It may be that the boning of a pork carcase, as that term is used in point 1.14, covers both these stages of removal of meat, so that the product of each stage does not fall to be categorised as MSM. But this court is not in a position to state any definitive view about that. As with the wishbone point, no relevant findings of fact, based on full evidence, have been made by the courts below and no legal proceedings have been issued in respect of this issue. I do not accept the submission of Mr Mercer that the reading of the CJEUs judgment as given by the Court of Appeal renders the third criterion in para 41 superfluous. On the contrary, the third criterion informs the first criterion, making it clear that it is not necessarily the case that all the meat on a poultry carcase which is removed by use of methods of mechanical separation has to be classified as MSM. It also informs the first criterion by giving some guidance regarding the concept of boning in point 1.14, thereby allowing for the possibility that the products of each of the two stages of removal of intact muscles from a pork carcase as referred to above might all fall outside the definition of MSM in that provision. As the CJEU said at para 41 of its judgment, the three cumulative criteria in point 1.14 must be read in conjunction with one other. In its judgment the CJEU made it explicit at many points that in its view on application of the definition in point 1.14 the products of Newbys process fall to be categorised as MSM. In its analysis the court made repeated direct references to Newbys process and the products of it, indicating explicitly that those products fell lIndustrie, within the category of low pressure MSM according to the courts interpretation of point 1.14: see paras 46, 50, 52, 53, 58, 59 and 64. The court could not have been clearer about this. Mr Mercer seeks to meet this aspect of the CJEUs judgment with the submission that the CJEUs role on a reference is to give an authoritative ruling on the interpretation of EU law, whereas it is the role of the national court to apply such a ruling to the facts of the case. Moreover, he points out that there are cases in which the CJEU has given a ruling on the interpretation of EU law and has also indicated how that law applies to the facts in a particular case, where the national court later reaches a different conclusion regarding the application of the law as interpreted by the CJEU to the facts of the case: the decision of this court in Revenue and Customs Comrs v Aimia Coalition Loyalty UK Ltd [2013] UKSC 15; [2013] 2 CMLR 51 is a prime example of this. Mr Mercer gave as another example the decision of the French Conseil dtat in De Groot en Slot Allium BV v Ministre de lconomie, des Finances et de judgment of 11 December 2006 ECLI:FR:CEASS:2006:23456020061211, following a judgment of the CJEU on a reference in those proceedings in (Case C 147/04) [2006] ECR I 261. So, contends Mr Mercer, it was open to Edwards Stuart J sitting in the national court when the proceedings resumed there after the reference, to examine the facts of the case and come to a conclusion opposite to that of the CJEU regarding the application of point 1.14 to Newbys products. The first part of Mr Mercers submission, as regards the division of responsibility between the CJEU and the national court making a reference under article 267 TFEU, is correct. It reflects a well established principle of EU law: see para 54 in the judgment of Lord Reed in the Aimia case. However, it is by no means unusual for the CJEU, consistently with that principle, to say itself how EU law should be applied to the facts of a particular case which is before it when it considers that the answer is clear. By way of example, Mr Coppel QC for the FSA referred us to Medical Imaging Systems GmbH (MIS) v Hauptzolloamt Mnchen (Case C 288/15) ECLI:EU:C:2016:424, at para 34; Kreyenhop & Kluge GmbH & Co KG v Hauptzollamt Hannover (Case C 471/17) ECLI:EU:C:2018:681, at para 47; Agenzia delle Dogane e dei Monopoli v Pilato SpA (Case C 445/17) ECLI:EU:C:2018:609, at para 41; and Mitnitsa Varna v SAKSA OOD (Case C 185/17) ECLI:EU:C:2018:108, at para 43; see also the discussion in M Broberg and N Fenger, Preliminary References to the European Court of Justice, 2nd ed (2014), at para 3.1 in Chapter 11. The CJEU proceeds in this way when it considers that the application of EU law, according to the interpretation the court has given it, is clear on the facts of the case. In the present case, the CJEUs conclusion that Newbys products fell to be categorised as MSM within point 1.14 simply reflected its ruling in para 41 of its judgment regarding the clarity of the test laid down in that provision, which had the obvious consequence that Newbys products fell to be so categorised according to that test. Indeed, the CJEU spelled this out at para 51 of its judgment. There is nothing untoward in the CJEU proceeding in this way and expressing its view regarding the application of EU law to the facts in an appropriate case. The Aimia case does not assist Mr Mercer. In that case, the CJEU gave an authoritative ruling regarding the proper interpretation of EU law and stated its conclusion regarding the application of that law to the facts of the case, as they had been set out in the reference. However, when the matter returned to the national court, that court was not bound by the statement of the facts as set out in the reference and instead made other, different findings of fact. The national court then applied the CJEUs authoritative guidance regarding EU law to the different facts of the case as determined by further examination of the relevant evidence at the national level, leading to a different conclusion as regards the application of EU law to the facts of the case: see the Aimia case at paras 46 52 and 56 per Lord Reed and at para 103 per Lord Hope. But in the present case there is no doubt that the CJEU understood very well the factual position as regards the operation of Newbys process and the products of it. This had all been clearly explained in the reference judgment and in the full evidence before the national court which was sent to the CJEU with the reference. The CJEU accurately summarised the position at paras 21 and 22 of its judgment. Even if there were any doubt regarding the CJEUs understanding of the different process by which breasts are removed from chicken carcases, that would not call into question the CJEUs understanding of the relevant facts in the case, which are those which concern Newbys process. Nor would that call into question the authoritative ruling of law by the CJEU regarding the proper interpretation of point 1.14 and the clear guidance it gave as to the application of that provision in relation to the products of Newbys process. Similar points fall to be made regarding the De Groot case on which Mr Mercer relied. That case concerned the compatibility with EU law of French legislation in respect of the labelling of shallots according to which only shallots derived in a traditional way from vegetative propagation by bulbs could be offered for sale under the name shallots, whereas varieties of shallots derived from seed as developed by De Groot and others could not be. The CJEU understood the reference to be founded on a common view between the parties in relation to the factual position regarding the differences between traditional shallots and seedling shallots, namely that those differences related essentially only to the method of reproduction. On that basis, the CJEU held that the French legislation was incompatible with EU law, as it would be sufficient to protect the interests of consumers if seedling shallots were marketed under the name shallots with a neutral additional statement that they were seedling shallots: paras 76 to 80 of the CJEUs judgment. However, as in the Aimia case, the Conseil dtat was not bound by that view of the facts and on further examination of the facts it found that there were other grounds for differentiation of the two sorts of shallot to do with their taste. The Conseil dtat therefore did not simply accept the conclusion of the CJEU, but carried out its own analysis of the position, applying the principles of EU law as laid down by the CJEU (in fact, as a result of that analysis, the Conseil dtat came to the same conclusion regarding the compatibility of the French legislation with EU law). For the reasons given above in relation to the Aimia case, this authority does not assist Mr Mercer. Returning to the judgment of CJEU in the present proceedings, the court gave further reasons at paras 56 and following for its interpretation of point 1.14 by reference to the general scheme of EU law in relation to the safety and labelling of meat products as set out in the TSE Regulation and in the Labelling Directive. This part of the reasoning of the court again makes it clear that the products of Newbys process fall to be categorised as MSM within the meaning of point 1.14. Mr Mercer had no good answer regarding the significance of these points for the proper interpretation of the CJEUs judgment in these proceedings. The definition of MSM in point 1.14 in Annex I to the Regulation is applicable both in respect of meat removed from the bones of ruminant animals such as cows and sheep and in respect of meat removed from the bones of non ruminant animals such as pigs and chickens. The definition in point 1.14 is also relevant for the purposes of the TSE Regulation, which together with the Regulation forms part of the EU regime governing the production of food from animals. The TSE Regulation lays down strict rules in relation to the production of meat from ruminant animals, to prevent the spread of transmissible spongiform encephalopathies associated with such animals. To that end, as noted above, it forbids the production of MSM from residual meat on the bones of such animals. The CJEU noted at para 22 of its judgment that the Newby process does not preclude the presence of occasional shards of bone in its products (this reflects para 23 of the reference judgment). On that basis, a reading of point 1.14 in the context of and having regard to the purpose of the TSE Regulation leads to the conclusion that Newbys products must be categorised as MSM under point 1.14: see paras 57 to 59 of the CJEUs judgment. That interpretation is necessary to secure the protection against the spread of transmissible spongiform encephalopathies associated with ruminant animals which is the primary object of the TSE Regulation. Since the meaning of point 1.14 is clear in relation to ruminant animals, it is also clear in relation to non ruminant animals. The CJEU also explained in paras 60 to 66 of its judgment why the same wide interpretation of point 1.14, covering the products of Newbys process, is necessary to secure primary objectives of the Labelling Directive. That is required so as to ensure that consumers are not misled as to the quality of products on sale and to ensure the free circulation of products in a context in which there is no unequal competition. This passage in the CJEUs judgment is, again, only consistent with the reading of the courts interpretation of point 1.14 given by the Court of Appeal. Finally, Mr Mercer sought to pray in aid article 11 TFEU in support of his proposed reading of the CJEUs judgment. I do not consider that this provision helps him. Article 11 TFEU sets out a general principle which informs the interpretation of EU legislation; it does not separately inform the reading to be given to a clear judgment of the CJEU. In the present case, the CJEU was well aware of the argument that a narrow interpretation of point 1.14 was appropriate so as to avoid unnecessary wastage of meat removed from animal carcases. The reference judgment referred to evidence that a large amount of meat, sometimes up to 80%, could be left on bones after the initial boning phase. The written observations of both the UK Government (representing the position of the FSA at that time) and Newby on the reference emphasised the desirability of an interpretation of point 1.14 which would avoid the wastage of meat suitable for human consumption which might occur if the products of Newbys process were categorised as MSM. There is no warrant for the suggestion that the CJEU overlooked this point when considering the proper interpretation of point 1.14. None of Newby, the UK Government, the Commission and the other member states which submitted written observations on the reference referred to article 11 TFEU, so it is not surprising that the CJEU did not find it necessary to refer to it. In any event, the CJEU has given a clear authoritative ruling regarding the proper interpretation of point 1.14 and reference to article 11 TFEU does not permit us to go behind that. I endorse what Lloyd Jones LJ said about article 11 TFEU in the Court of Appeal at para 43, set out above. This appeal turns on the proper interpretation of the CJEUs judgment, as it applies in relation to the products of Newbys process. On the proper interpretation of that judgment, the answer is clear that those products fall to be categorised as MSM within point 1.14. The position is acte clair and no further reference to the CJEU is required. For the reasons given above, I would dismiss this appeal.

This case is about the application of EU food hygiene rules to certain chicken and pork products manufactured by the appellant, Newby Foods Ltd (Newby). Specifically, the appeal concerns whether these products should be classified as mechanically separated meat (MSM) within point 1.14 of Annex I to EU Regulation No 853/2004 (the Regulation). Newby argues they should not be classified as MSM. The Food Standards Agency (FSA) contends that they should be so classified. It is now common for the butchering of animal carcases in the food industry across the EU to be carried out by machines. These often leave a significant amount of meat on the bone. Under the Regulation, there are two types of MSM: (1) high pressure MSM and (2) low pressure MSM. The specific hygiene requirements for both are set by paragraphs 3 4, Chapter III, Section V, Annex III in the Regulation. Further, MSM cannot count towards food meat content and attracts specific labelling requirements. MSM produced from lamb and beef bones is prohibited entirely under EU law. Consequently, the commercial value of MSM is much lower than that of other fresh meat products. Newby has developed a machine to remove residual meat from carcase bones. It uses this to process residual meat on beef, lamb and pork bones after the initial boning of the animal carcases and on chicken carcases after the breasts have first been removed by other mechanical processes. The Newby process has two stages: (1) meat bearing bones are forced into contact to remove meat by shearing and (2) meat so removed is then passed through a machine producing a product similar to minced meat. Newbys meat product was previously known in the UK as desinewed meat (DSM). It was widely regarded as distinct from MSM, including by the FSA. DSM is not a category recognised in EU law. On 4 April 2012, following criticism by the Commission, the FSA issued a moratorium with the result that DSM could (1) no longer be produced from residual meat on beef and lamb bones and (2) only be produced from residual meat on chicken and pork bones if classified and labelled as MSM. Newby brought judicial review proceedings challenging the moratorium. On 16 July 2013, Edwards Stuart J in the High Court made a preliminary reference to the Court of Justice of the European Union (CJEU) on the definition of MSM in point 1.14 of Annex I of the Regulation (point 1.14). The CJEU made a preliminary ruling on 16 October 2014 (the CJEU judgment). After the CJEU judgment, Newby abandoned its challenge to the moratorium as to lamb and beef carcases, but not pork and chicken. On 23 March 2016, Edwards Stuart J concluded that the pork and chicken meat products resulting from stage (1) of Newbys process are not MSM. He also found that such DSM was not a product derived from bone scrapings. The Court of Appeal allowed the appeal and dismissed the challenge to the moratorium, but upheld the judges finding as to bone scrapings. Newby now appeals to the Supreme Court on the proper interpretation of point 1.14 in light of the CJEU judgment. The Supreme Court unanimously dismisses the appeal. Lord Sales gives the lead judgment, with which all members of the Court agree. The proper interpretation of point 1.14 requires a correct application of the guidance provided in the CJEU judgment [51]. In its preliminary ruling, the CJEU identified three cumulative criteria in defining MSM for the purposes of point 1.14: (1) the use of bones from which the intact muscles have already been detached, or of poultry carcases, to which meat remains attached; (2) the use of methods of mechanical separation to recover that meat; and (3) the loss or modification of the muscle fibre structure of the meat recovered through the use of those processes [26]. The CJEU added that any meat product which satisfies those three criteria must be classified as MSM, irrespective of the degree of loss or modification of the muscle fibre structure, provided the loss or modification is greater than that which is strictly confined to the cutting point (the cutting point qualification) [26]. In the Supreme Court, it was common ground between the parties that Newbys pork and chicken products meet the first two criteria for categorisation of MSM within point 1.14 [52]. The appeal thus turns on whether Newbys products meet criterion (3), in light of the cutting point qualification [52]. As identified in the courts below, there are two main possible readings of what the CJEU meant by cutting point: (1) on a narrower reading, it refers to the cutting of intact muscles, or (2) on a more expansive reading, it refers to the points at which the meat has been severed or separated during the process of recovering it [39]. Edwards Stuart J favoured the more expansive reading [42 43], while the Court of Appeal preferred the narrower reading [45 46]. This Court finds that, on the proper interpretation of the CJEU judgment, the narrower reading is correct [51]. First, the way in which the CJEU formulated criterion (1) reflects the words removing meat from flesh bearing bones after boning or from poultry carcases in point 1.14 [54]. The CJEUs formulation speaks of meat remaining attached to poultry carcases, rather than simply referring to poultry carcases, which would include all (not merely some of) the meat on the carcase [55]. Secondly, the CJEU clearly held that the concept of MSM does not depend on it being shown that the process referred to in point 1.14 results in a loss or modification of the muscle fibre structure which is significant, rejecting outright Newbys case [56]. On the CJEUs approach, the dividing line is much clearer. Meat removed from a carcase will not be MSM if it is removed by mechanical means in the first phase of cutting meat from the whole carcase, but will generally be MSM if it is later removed by mechanical means [57]. This clear distinction avoids the need for microscopic investigation [57]. Thirdly, the legal analysis is not affected by evidence (1) that chicken carcases will occasionally be subjected to Newbys process without the breasts first being removed or (2) that the wishbone is usually cut out of the breast meat before mechanical removal of whole chicken breasts [61 63]. Lastly and importantly, the CJEU judgment made it explicit that, applying the definition in point 1.14, Newbys products fall to be categorised as MSM [66]. The CJEU was entitled to express its view on the application of point 1.14 to this case and there is nothing to call into question its analysis [69 75]. After the CJEU judgment, the position is acte clair and no further reference to the CJEU is needed [76]. The Court reaches the above conclusions having seen, but not relied on, further evidence submitted by three of the four interveners [49 50]. The Court refuses permission to admit this further evidence due to unfairness to the FSA and, in any event, this evidence is not considered to affect the outcome [50].

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This is an appeal against a decision of the Court of Appeal upholding a series of case management decisions by judges of the Chancery Division. It arises out of a joint venture between Apex Global Management Ltd (Apex), a Seychelles company owned by Mr Almhairat, and Global Torch Ltd (Global), a BVI company owned by Prince Abdulaziz (the Prince), Mr Abu Ayshih and Mr Sabha. Apex and Global set up an English company Fi Call Ltd (Fi Call), and then fell out badly. On 2 December 2011, Global issued a petition under section 994 of the Companies Act 2006 against Apex, Mr Almhairat and Fi Call seeking share purchase orders, and pecuniary and declaratory relief. Ten days later, Apex issued a not dissimilar cross petition against Global, the Prince, Mr Abu Ayshih, the Princes father, and Fi Call. Allegations and counter allegations of seriously unlawful misconduct are involved, including money laundering, financial misappropriation, and funding of terrorism. The two petitions were ordered to be heard together. It is relevant to mention that the pecuniary relief sought by Apex included a claim for just under $6m (and for convenience I shall treat it as $6m) plus interest, which it contended was owing to Apex by the Prince. The Prince denied that the $6m was owing on the ground that he had paid it into various bank accounts of Fi Call for which Mr Abu Ayshih and Mr Almhairat were apparently joint signatories. Apex accepted that it had been agreed that the Prince could pay the $6m to Apex by paying it into Fi Call bank accounts, but did not accept that the payments relied on by the Prince were intended to discharge, or did discharge, his liability to pay Apex $6m. A Case Management Conference took place before Vos J on 30 and 31 July 2013, at which he considered and resolved a number of disputed case management issues, and his directions were set out in a detailed order (the Order). For present purposes, only paras 14 and 15 of the Order are relevant. Both paragraphs contain a direction that all parties (save Fi Call) should by 6 August (para 14) or 12 August (para 15) file and serve a statement, certified by a Statement of Truth signed by them personally in the case of individuals and by an officer of the company in the case of the two companies. The statements under para 14 were required to identify the location and other details of servers, electronic devices and email accounts of Fi Call to which the party concerned had or had had access. The statements under para 15 were required to identify the location and other details of email accounts and electronic device not provided by Fi Call to which the party concerned had or had had access. The Prince did not object to this form of order when it was proposed on 30 July, but, on the following day, his counsel argued that he ought not be required to sign the statements referred to in paras 14 and 15 of the Order personally, but Vos J rejected the argument. Thereafter, the Prince purported to comply with paras 14 and 15 of the Order, but his statements did not deal with mobile devices, and, more to the point, the accompanying Statements of Truth were signed not by the Prince, but by Mr Abu Ayshih, who was his close adviser, on his own and on the Princes behalf. As the Prince had failed to comply with paras 14 and 15, Apex and Mr Almhairat (the Apex parties) applied to Norris J on 9 September 2013, seeking an unless order, ie an order that, unless the Prince complied with those paragraphs of the Order, and in particular signed a Statement of Truth, his defence be struck out and judgment be entered against him. On the basis that he was being asked to enforce[e] compliance with rules, practice directions and orders under CPR 1.1(2)(f), Norris J made the unless order sought, giving the Prince nine days to comply, and refused permission to appeal. The Prince maintained his position, and accordingly the Apex parties applied to Norris J on 14 October 2013 under CPR 3.5(2) for judgment to be entered in their favour, and in particular Apex applied for judgment to be entered in its favour for the $6m plus interest. Norris J granted that application on the papers ie without an oral hearing. The Prince then applied under CPR 3.1(7) for a variation of Vos Js order so as to permit his solicitor to confirm on oath, on his behalf, that he had given full disclosure and for relief from sanctions. He also filed a witness statement from his solicitor, seeking to make it clear that the Prince had had explained to him the effect of paras 14 and 15 of the Order, and that he had complied with it. In a judgment given on 30 October 2013, Mann J refused to vary the order of Vos J on the ground that there had been no change of circumstances. Subsequently, in a judgment given on 29 November he rejected the Princes application to be relie[ved] from sanctions under CPR 3.9. On 31 July 2014, Hildyard J refused, with some reluctance, an application (the precise nature of which is unimportant for present purposes) for summary judgment in relation to the question whether the $6m had in fact been repaid by the Prince. Meanwhile, the Prince appealed the decisions of Vos J, Norris J and Mann J to the Court of Appeal which rejected his appeals for reasons contained in a judgment, which (like that of Hildyard J) was given on 31 July 2014, the reasons being expressed by Arden LJ with whom McFarlane and McCombe LJJ agreed [2014] EWCA Civ 1106. The Prince now appeals to this court against that decision. The Prince sought permission to appeal to this Court against the decision of the Court of Appeal, and he was given permission on terms that he paid $6m (plus interest) to his solicitors to abide the order of the court, a condition which he complied with, albeit late. Because the trial was due to start shortly, the Princes appeal was heard on 13 October, and on the day following the hearing we informed the parties that the appeal would be dismissed for reasons which would be given later, on the basis that the parties could thereafter make written submissions as to the order which should be made in relation to the monies paid to the Princes solicitors. 12. The attack on the decisions below: general 14. 13. Accordingly, at least as at present advised, I consider that the view taken by Vos J and the Court of Appeal, namely that a direction requiring personal signing of disclosure statements reflected the normal practice, was correct. However, that is not, in my view, the essential question when it comes to challenging paras 14 and 15 of the Order. The essential question is whether it was a direction which Vos J could properly have given. Given that it was a case management decision, it would be inappropriate for an appellate court to reverse or otherwise interfere with it, unless it was plainly wrong in the sense of being outside the generous ambit where reasonable decision makers may disagree as Lewison LJ expressed it in Broughton v Kop Football (Cayman) Ltd [2012] EWCA Civ 1743, para 51. It appears clear from the transcript of the hearing before Vos J that the ground on which he was being invited not to order the Prince to sign the disclosure statement personally was that the Prince would not sign the document because there was a Saudi Arabian protocol (to use Vos Js description) that members of the Royal Family should not become personally involved in any way in litigation. Vos J was sceptical as to the existence and the applicability of this protocol. This is unsurprising, as (i) the evidence as to its existence was principally given by a witness, whose evidence on other points the Judge had previously rejected as incredible, (ii) Vos J was also told by the Princes counsel that he understood that the question of his client giving evidence was still being considered, (iii) another Saudi prince had given evidence in a case before Peter Smith J, and (iv) even if the protocol existed, it was hard to accept that it can have been intended to apply outside Saudi Arabia. In any event, as Arden LJ put it in para 29 in the judgment of the Court of Appeal, Vos J considered it of the utmost importance having regard to the gravity of the allegations that there should be proper pleadings and full disclosure. 15. Given the very serious and bitterly disputed allegations and counter allegations in the proceedings, the doubts as to the existence, status and reach of the alleged protocol and the fact that all other parties were being required to sign disclosure statements personally (and it was not suggested by anyone to Vos J that all the parties should have the same indulgence as the Prince), it is very difficult to see how Vos Js conclusion could be faulted; it appears to me to have been well within the generous margin accorded to case management decisions of first instance judges. 16. As for the hearing before Norris J on 9 September ([2013] EWHC 2818 (Ch)), the Prince again raised the alleged protocol, and suggested that Mr Abu Ayshih could sign the required statement on his behalf confirming that full disclosure had been given. In the course of a careful judgment, Norris J accepted, at para 8, that the striking out of a statement of case is one of the most powerful weapons in the courts case management armoury and should not be deployed unless its consequences can be justified. He also accepted, at para 11, that he should consider the effect of making, or not making, the order sought on the overall fairness of the proceedings and the wider interests of justice as reflected in the overriding objective (quoting from Christopher Clarke J in JSC BTA Bank v Ablyazov (No 3) [2010] EWHC 2219). 17. Norris J then rejected the Princes proposal, saying at para 13 that, if that suggestion was adopted there is a real risk that the overall fairness of the proceedings will be jeopardised. Everyone else will have put their cards on the table. The Prince will deal through an agent. He explained that this would be unfair because [e]veryone else will be exposed to criticism and have their credibility attacked if they are shown to have concealed some relevant account, relevant device, or relevant communication. But, the Prince says that he should be exempt from that criticism. He therefore considered (para 15) that some sanction must be applied and was satisfied that an unless order is the only proper relief to grant in these circumstances, not least because it gave the Prince another opportunity to comply with paras 14 and 15 of the Order. 18. Again, I find it very hard to discern any grounds for challenging Norris Js first decision, which resulted from a correct approach in principle and a careful consideration of the competing arguments, unless it can be said to have resulted in a disproportionate result the first point mentioned in para 11 above, and which I shall consider below. Similarly, there is no basis for challenging the second decision of Norris J (which was almost administrative in nature). 19. The first decision of Mann J ([2013] EWHC 3478 (Ch)), rejecting the Princes application to vary paras 14 and 15 of the Order, was based on a very full analysis of the factual and procedural position, and he approached the issue by reference to the guidance given by Rix LJ in Tibbles v SIG plc [2012] 1 WLR 2591, para 39. He concluded, at para 20, that the requirements for attacking the decision of Vos J within the Tibbles catalogue have [not] come even close to being fulfilled. It is unnecessary to expand on this brief and allusive summary of Mann Js first decision, because, realistically, the reasoning has not been questioned on this appeal. What is relied on by the Prince are the three arguments summarised in para 11 above, which I shall consider below. 20. The second judgment of Mann J ([2013] EWHC 3752 (Ch)) dealt with many issues which are irrelevant for present purposes. However, he dealt in some detail with the Princes application to be relieved from the sanction imposed and enforced by Norris J, which amounted to an application to set aside the judgment entered against the Prince. This was proposed on the basis that the Prince had substantially complied with paras 14 and 15 of the Order in the light of a very full witness statement from his solicitor. Mann J thought that the Prince was raising points which had already been decided. In any event, he was concerned that, if the Princes proposal was adopted, there would not be what he called a level playing field so far as the other litigants were concerned a point which had also weighed with Norris J, as explained in para 16 above. Mann J was also sceptical about the existence of the alleged protocol, which he described as having emerged in a piecemeal and relatively casual way for something which is as central as it is now said to be. He also described it as a matter of collective choice for members of the Saudi Royal Family, to which an English court should not defer (para 41, viii). He also rejected arguments based on the points mentioned in para 11 above, which I deal with below. At any rate subject to those points, it seems to me that the second decision of Mann J was unassailable. In the light of my conclusion that, at least subject to the three points mentioned in para 11 above, the decisions of Vos J, Norris J and Mann J in these proceedings were unassailable, it follows that, in dismissing the appeals against those decisions, I consider that the Court of Appeal was right, albeit again subject to the three points to which I now turn. 21. Alleged disproportionality 22. There is undoubtedly attraction in the contention that preventing the Prince from challenging his liability for $6m is a disproportionate sanction in circumstances where he appears to have what was referred to on his behalf at first instance as a substantive defence (and as it was put by Mann J in his first judgment). A stark view of the Court of Appeals decision is that it deprived a defendant of the opportunity to maintain a defence to a claim for $6m simply because he has failed to comply with an order that he sign a document, when his solicitor was prepared to sign it on his behalf. Expressed thus, the decision may indeed look like an overreaction, and that is no doubt how it would strike the Prince. 23. This contention effectively involves saying that, although each decision on the way to the final result is unassailable (at least subject to the Princes two remaining arguments), the final result is wrong on the ground of lack of proportionality. I suppose that may be logically possible, but it is a difficult 24. position to maintain. More to the point, in my view, on analysis, the contention does not stand up. The importance of litigants obeying orders of court is self evident. Once a court order is disobeyed, the imposition of a sanction is almost always inevitable if court orders are to continue to enjoy the respect which they ought to have. And, if persistence in the disobedience would lead to an unfair trial, it seems, at least in the absence of special circumstances, hard to quarrel with a sanction which prevents the party in breach from presenting (in the case of a claimant) or resisting (in the case of a defendant) the claim. And, if the disobedience continues notwithstanding the imposition of a sanction, the enforcement of the sanction is almost inevitable, essentially for the same reasons. Of course, in a particular case, the court may be persuaded by special factors to reconsider the original order, or the imposition or enforcement of the sanction. In the present case, essentially for the reasons given by the three judges in their respective judgments, there do not appear to be any special factors (subject to what I say in the next two sections of this judgment). Further, it is difficult to have much sympathy with a litigant who has failed to comply with an unless order, when the original order was in standard terms, the litigant has been given every opportunity to comply with it, he has failed to come up with a convincing explanation as to why he has not done so, and it was he, albeit through a company of which he is a major shareholder, who invoked the jurisdiction of the court in the first place. 25. One of the important aims of the changes embodied in the Civil Procedure Rules and, more recently, following Sir Rupert Jacksons report on costs, was to ensure that procedural orders reflected not only the interests of the litigation concerned, but also the interests of the efficient administration of justice more generally. The Prince has had two very clear opportunities to comply with the simple obligation to give disclosure in an appropriate fashion, namely pursuant to the orders of Vos J and of Norris J. Indeed, there would have been a very good chance that, if he had offered to sign the relevant statement after judgment had been entered against him, the court would have set aside the judgment and permitted him to defend (provided that no unfair prejudice was thereby caused to the other parties, and he satisfied any appropriate terms which were imposed). 26. The offer made to Mann J and repeated to the Court of Appeal that the Princes solicitor would confirm, on the Princes instruction, that full disclosure had been given, does not assist the Prince. It would not, I think, have complied with the normal procedure as set out in the relevant Practice Direction, and while the court had the power to depart from that procedure, there is no obvious reason why it should have done so in this case. It would have involved undermining the case management decisions of Vos J, Norris J and Mann J. It would also have been unfair on the respondents as it would have meant that the intended contemporaneous exchange of disclosure statements could not take place. Further, the Prince would have been accorded a privilege over the other parties. In addition, even now the disclosure given by the Princes solicitor is self evidently defective as he failed to give details of all email addresses and electronic devices to which the Prince had access. It also seems quite probable that the hearing date would have been lost if the Prince had been permitted to take part in the trial at such a late stage. 27. Mr Fenwick relied on Cropper v Smith (1884) 26 Ch D 700, 710, where Bowen LJ said that he knew of no kind of error or mistake which, if not fraudulent or intended to overreach, the Court ought not to correct, if it can be done without injustice to the other party. There are three problems for the Prince in this connection. The first is that these observations were made in connection with a proposed amendment to a pleading, ie an attempt by a litigant to do something which he would be entitled to do, but to do it late; whereas here we are concerned with a party who does not even now intend to obey a court order. Secondly, as the points made in the last few sentences of the immediately preceding paragraph of this judgment illustrate, there would be prejudice to the other parties if the Princes current proposal was adopted. Thirdly and even more importantly, the approach laid down in Cropper has been overtaken by the CPR. The strength of the Princes defence 28. Mr Fenwick also relied on the fact that the Princes contention in his pleaded case that he had already paid the $6m was very strong, that this should have been taken into account by the courts below, and should have resulted in his being permitted to defend the claims against him. Presumably, this would be on the basis that some other unspecified sanction should be imposed on the Prince. Some of the evidence relied on to justify this contention came into existence after the Court of Appeal gave its decision, but I am prepared to assume, without deciding, that it can be taken into account. In my view, the strength of a partys case on the ultimate merits of the proceedings is generally irrelevant when it comes to case management issues of the sort which were the subject matter of the decisions of Vos J, Norris J and Mann J in these proceedings. The one possible exception could be where a party has a case whose strength would entitle him to summary judgment. Both the general rule and the exception appeared to be common ground between the parties, although Mr Fenwick seemed to be inclined at one stage 29. to suggest that the exception might be a little wider. In my view, the general rule is justifiable on both principled and practical grounds. 31. 30. A trial involves directions and case management decisions, and it is hard to see why the strength of either partys case should, at least normally, affect the nature or the enforcement of those directions and decisions. While it may be a different way of making the same point, it is also hard to identify quite how a court, when giving directions or imposing a sanction, could satisfactorily take into account the ultimate prospects of success in a principled way. Further, it would be thoroughly undesirable if, every time the court was considering the imposition or enforcement of a sanction, it could be faced with the exercise of assessing the strength of the parties respective cases: it would lead to such applications costing much more and taking up much more court time than they already do. It would thus be inherently undesirable and contrary to the aim of the Woolf and Jackson reforms. In principle, where a person has a strong enough case to obtain summary judgment, he is not normally susceptible to the argument that he must face a trial. And, in practical terms, the risk involved in considering the ultimate merits would be much reduced: the merits would be relevant in relatively few cases, and, in those cases, unless the court could be quickly persuaded that the outcome was clear, it would refuse to consider the merits. Accordingly, there is force in the argument that a party who has a strong enough case to obtain summary judgment should, as an exception to the general rule, be entitled to rely on that fact in relation to case management decisions. For present purposes, I am prepared to assume in the Princes favour that that is indeed correct. I should add that I do not think that it would be enough for a party to show that, while his arguments were not strong enough to justify summary judgment, his arguments were strong enough to justify the other party being required to bring the disputed sum into court if he was to be entitled to proceed with his case. For present purposes, as with an outright order for summary judgment, a claim or defence is either unanswerable or it is not. A conditional order, typically requiring a party to provide security if it wishes to proceed with its claim or defence, is granted in rather nuanced and case specific circumstances. Neither as a matter of principle nor as a matter of practicality would it be appropriate to extend the exception to such a case. 33. Turning to the facts of this case, I do not need to set them out, not least because they are clearly recited by Lord Clarke in paras 48 61, 64 66 and 68 73 of his judgment. I readily accept that the evidence shows that the Prince would have had a good prospect of establishing that the $6m was paid as he 32. 34. contends in his defence. However, I cannot accept that his prospects can be said to be any higher. In the first place, it would risk unfairness to the Apex parties to hold that the Prince had an unanswerable case, as that point had not really been flagged up as part of his argument until the Prince was given permission to appeal to this court. As mentioned, before Mann J, the Prince argued that he had a substantive defence, and before the Court of Appeal it was argued that the merits of the case should be considered, but it does not appear to have been claimed that he had an unanswerable case (see para 87 of Arden LJs judgment). Even in his printed case for this appeal, the Prince is described as having a very strong defence on the merits, not an unanswerable defence. If, at an interlocutory hearing which is not a summary judgment hearing, a party wishes to rely on the contention that he has an unanswerable claim or defence, it seems to me that he should spell out that contention very clearly in advance, as otherwise the raising of the contention at the hearing could wreak obvious unfairness on the other party. 35. Secondly, even based on the current evidence, I do not consider that it can be said that it is plain that the Prince will succeed in establishing that he had paid the $6m as he alleges. It is true that payments totalling around $6m were made by the Prince into accounts in the name of Fi Call mentioned in para 2 above. However, the payments were not made on the dates or into the accounts into which they ought to have been made if they were paid pursuant to the arrangements relied on by the Prince. The Apex parties suggestion that the money was paid by the Prince under a $20m loan agreement does not appear fanciful, although it may ultimately be rejected: it is common ground that the loan agreement exists. Further, the fact that much of the money may have been subsequently paid out to the Prince may be inconsistent with the Princes case. We have seen some of the payments into and out of the bank accounts into which the Prince paid the $6m, but we have not seen all of them. It is also true that the Apex parties case on the payments by the Prince has not been consistent. However, the proceedings involve many serious allegations by and against the Prince, and it would require a particularly clear case before any court could properly conclude that the claim for $6m against him was plainly bound to fail or indeed to succeed. It is also true that, when the matter was before him, Hildyard J described the case against the Prince on this issue as [to] put it lightly, frail. But he did not think it right to enter summary judgment, and in any event we have to form our own view. The fact that there will be a trial 36. The final point relied on by Mr Fenwick was that the issue of whether the $6m had been paid may well be raised at the trial, and at least will be the basis on an attack on the credibility of Mr Almhairat. Thus, the very issue which the Prince would be precluded from contesting if his appeal is dismissed may be determined in the very proceedings which he would have been debarred from defending. This was a point which featured in the Princes argument before Mann J, who rejected it. And although it has some attraction, I consider that he was right, and certainly entitled, to reject it. 37. While, as I say, this argument has some attraction, in the end it seems to me that it simply represents, as Lord Hodge pointed out in argument, a relatively extreme example of what happens if the court orders that a default judgment be entered against a defendant. It is inherent in such an order that the claimants will obtain judgment for relief to which it may subsequently be shown that they were not entitled. Indeed, it is fair to say that, even where judgment for some relief is obtained by claimants after a full trial, evidence may emerge in a later case which establishes that they were not entitled to that relief. 38. So far as this case is concerned, it is worth considering the point a little further. It seems unlikely that, if the contention that the Prince had already paid the $6m is maintained at trial, it will be ruled on by the trial judge unless it is necessary to do so in order to resolve a live issue between the remaining parties, ie an issue which will affect the terms of any court order. And, if the contention had to be resolved in order to determine such an issue between the remaining parties, and the trial judge concluded that the $6m had in fact been paid by the Prince, it is conceivable that the Prince would be able to recover the $6m or its equivalent. That is, I must emphasise, mere speculation on my part, but it illustrates that the Prince may not be without some hope, albeit of a highly speculative nature, of getting the $6m returned, if he had in fact paid it. To that extent, he is actually better off than if this was a more normal case involving the enforcement of a sanction. Concluding remarks 39. It is right to acknowledge that, in the course of this judgment, I have expressed myself in some places in somewhat tentative terms (eg in paras 12 13, 23, and 31). This reflects the point that issues such as those raised by this appeal are primarily for the Court of Appeal to resolve. It would, of course, be wrong in principle for this court to refuse to entertain an appeal against a decision simply because it involved case management and the application of the CPR. However, when it comes to case management and application of the CPR, just as the Court of Appeal is generally reluctant to interfere with trial judges decisions so should the Supreme Court be very diffident about interfering with the guidance given or principles laid down by the Court of Appeal. It is also right to say that nothing in this judgment is intended to impinge on the decisions or reasoning of the Court of Appeal in Mitchell vs News Group Newspapers Ltd [2013] EWCA Civ 1537, [2014] 1 WLR 795 or Denton v TH White Ltd [2014] EWCA Civ 906. 40. 41. As it is, for the reasons I have given, I consider that we should dismiss the Princes appeal. 43. Postscript 42. After the argument on this appeal had been concluded and we had notified the parties of our conclusion, but before we handed down this judgment, we were advised of recent judgments of Hildyard J in the principal action, given on 3 and 5 November, when he reluctantly adjourned the trial to 2015 (subject to certain conditions) on the application of Mr Almhairat and, in light of Mr Almhairats own evidence as to what had happened to some of the assets of Fi Call, gave some protection to the Prince in respect of the monies held by his solicitors. It would not be right for this Court to address the question whether to reconsider its decision to dismiss the Princes appeal in the light of these developments, and in particular in the light of any breaches of the CPR or any orders by any of the Apex parties. If, in the light of events which have occurred since we heard and decided the Princes appeal, reconsideration, revocation or modification of any of the orders affirmed by the Court of Appeal is appropriate (as to which it would be wrong for this Court to give any encouragement or discouragement), then that is a matter which should be raised before a Judge of the Chancery Division. As I have already indicated, case management and procedural issues should be determined by a first instance judge, and, occasionally, on appeal, by the Court of Appeal, when they decide it is right not to send a matter back to a judge, but to decide it for themselves. It may be worth emphasising that, if such an application were made, then the effect of the previous first instance decisions of Vos J, Norris J and Mann J should not be treated as having any greater (or any lesser) force than if they had not been upheld by the Court of Appeal and the Supreme Court. 44. As to the monies held by the Princes solicitors, we can well understand what led Hildyard J to be concerned about the possibility of the monies being released to the Apex parties or any of them. It seems to me that the appropriate order for this Court to make in connection with the monies is that they continue to be held by the Princes solicitors until such time as a High Court Judge directs them to be paid out, whereupon they should be paid out in accordance with the Judges direction. 45. The parties counsel should draw up and agree a form of order which gives effect to our decision. LORD CLARKE: 46. I have reached a different conclusion from the majority in this appeal.1 I would have allowed the appeal on the ground that, in all the circumstances, justice requires that Prince Abdulaziz (the Prince) should be allowed to challenge the claim by Apex and Mr Almhairat that he owes them the US$6m referred to by Lord Neuberger in para 1 of his judgment. I would allow him to do so on terms that the monies amounting to US$8,699,988.49 (ie US$8,700,000 less US$11.51 bank charges) secured by the Princes solicitors in an undertaking given to the Supreme Court by letter dated 8 October 2014 should be made available to the respondents if they succeed. In this way all parties would be protected and justice would be done because the court would be able to resolve all the issues between the parties, both to this appeal and to the underlying proceedings. Moreover there would be no possibility of inconsistency between the outcome of this appeal and the outcome of the underlying proceedings. 47. Lord Neuberger has set out in detail an account of the proceedings to date. I do not disagree with his conclusions at paras 1 to 21. Indeed, I agree that the Prince only has himself to blame for the predicament he is in. However, each case depends upon its own facts and this is in some respects a most unusual case. In a somewhat different context, in Summers v Fairclough Homes Ltd [2012] UKSC 26, [2012] 1 WLR 2004, I expressed the view in para 48 (on 1 In this judgment I will for the most part use the same abbreviations as Lord Neuberger has used in his judgment. behalf of the court) that, in deciding whether to strike out an action, both under the inherent jurisdiction of the court and under the CPR, the court must examine the circumstances of the case scrupulously in order to ensure that to strike out the claim is a proportionate means of controlling the process of the court and deciding cases justly. Then, before expressing the view that the draconian step of striking a claim out is always a last resort, I then referred (at para 49) to a number of cases and, in particular, this statement of Rix LJ in Aktas v Adepta [2011] QB 894, para 92: Moreover, it should not be forgotten that one of the great virtues of the CPR is that, by providing more flexible remedies for breaches of rules as well as a stricter regulatory environment, the courts are given the powers and the opportunities to make the sanction fit the breach. That is the teaching of one of the most important early decisions on the CPR to be found in Biguzzi v Rank Leisure plc. [1999] 1 WLR 1926, 1933 48. As I see it, the same principles apply to the striking out of a defence. In my opinion it would be disproportionate to allow the judgment to stand, at any rate on the basis that the respondents would forthwith be able to call upon the undertaking referred to above. I have reached this conclusion on the particular facts of this case. It is important to have regard to the stance taken by all the parties in this litigation. Lord Neuberger has referred to what I agree have been the failings of the Prince in this litigation. However, account must in my opinion also be taken of the stance taken by the respondents as well as the Prince. If such account is taken, it is my opinion that the just course is that proposed above. 49. The position on the pleadings is as follows. In paras 64 to 71 of the amended points of claim Apex and Mr Almhairat pleaded their case in relation to the Al Masoud SPA shortly in this way. The agreement included the following. Apex would sell 4,400,000 A shares in Fi Call to Mr Al Masoud for US$5,984,000 and Global Torch would sell 2,933,333 B shares in Fi Call to Mr Al Masoud for US$4,016,000. The total purchase price was thus US$10,000,000. Payment was to be by bankers drafts into the bank account of Fi Call at HSBC in London. Fi Call would receive the monies as agent for Apex and Global Torch respectively. It was alleged in para 67 that Mr Al Masoud did not pay any part of the price into a Fi Call company account at HSBC. Instead (it is said) on or about 7 February 2010 he or his agent paid the sum of US$10m to the Prince, purportedly in satisfaction of the debts owed by Mr Al Masoud to Apex and Global Torch, and the Prince accepted 50. 51. 52. 53. that payment in purported satisfaction of those debts. It was alleged in para 68 that Apex was entitled to treat the Prince as having received the sum of US$5,984,000 on behalf of and for the benefit of Apex. It was alleged in para 69 that Apex elected to treat the Prince as having received the sum of US$5,984,000 on its behalf on various bases and in para 70 that the Prince held that sum on trust for Apex. It was then alleged in para 71 that the Prince had failed to account for any part of the US$5,984,000 or indeed of the US$10m. In para 151.5 it was asserted that there should be added to the notional value of Apexs shares the sum of US$5,984,000 to which Apex was entitled pursuant to the Al Masoud SPA but which was instead paid to the Prince. In para 75 of the defence and counterclaim of Global Torch (and the defence of Mr Abu Ayshih) the following pleas were advanced in response to para 67 of the amended points of claim. It was admitted that Mr Al Masoud paid the share purchase consideration to the Prince on 7 February but not that it was done without the knowledge or consent of Apex. On the contrary it was alleged that Mr Almhairat knew full well how the payment would be made because it was discussed beforehand. The following was alleged in para 75.3. It was admitted that the Prince accepted the payment as being in satisfaction of the debt owed under the Al Masoud SPA. However, it was averred that he did not retain the whole sum for his own benefit. He retained US$1,999,985 in his account as representing part payment of the sum that would have been due to Global Torch under the Al Masoud SPA. The remainder of the monies were paid as follows: US$1,999,985 to Fi Calls bank account held at Al Mawarid Bank in the Lebanon; US$1,999,985 to Fi Calls bank account held by HSBC in London; and on 11 March 2010 US$3,999,973 to Fi Calls bank account held at the ABC Bank in Jordan. It was noted that once regard is had to bank charges the total of those sums is US$10m. In para 76 it was alleged that on 15, 24 and 26 March 2010 Mr Almhairat withdrew from those various bank accounts a total of US$4,410,115 for his own purposes, leaving the balance of the sale proceeds as a contribution by Apex to the working of Fi Call. In para 77, para 68 of the amended points of claim was denied and it was specifically denied that the Prince received any element of the funds for the benefit of Apex. In para 39 of the reply and defence to counterclaim, which was dated 24 January 2014, it was admitted that Mr Al Masoud made the payments alleged but it was denied that they were made pursuant to, or in performance of, the Al Masoud SPA. By para 42, paras 75 and 76 of the defence and counterclaim were not admitted. Thus no positive case was pleaded as to the detailed payments alleged in paras 75.3 and 76 summarised in paras 5 and 6 above. 54. The position of the Global Parties (ie Global Torch and Mr Abu Ayshih) was summarised in a notice to admit the following facts served on 5 February 2014. On or about 7 or 8 February 2010 the equivalent of US$10m was paid into the Princes SABB bank account. That payment represented the payment by Mr Al Masoud in consideration of the shares sold by Apex and Global Torch to him under the Al Masoud SPA. Between 16 and 18 February, the equivalent of US$1,999,985 was transferred from the Princes SABB bank account to his M300 bank account. Between 16 and 17 February 2010 the equivalent of US$1,999,985 was transferred from the Princes SABB account to Fi Calls Al Mawarid bank account. On or about 11 March 2010 the equivalent of US$3,999,373 was transferred from the Princes SABB account to Fi Calls Arab Banking Corporation (Jordan) bank account. Between 13 and 15 March 2010 the equivalent of US$1,999,871 was transferred from the Princes SABB account to Fi Calls Arab Banking Corporation (Jordan) bank account. As a result of those transactions, out of the US$10m paid to him by Mr Al Masoud in connection with the Al Masoud SPA, the Prince paid about US$8m (or US$7,999,829) to accounts in Fi Calls name and did not retain any part for his own purposes except for the US$1,999,985 transferred to his M300 account. 55. Further, the notice to admit invited admission of the following further facts. On or about 15 March 2010 Mr Almhairat withdrew (or transferred to an account controlled by him and/or Apex) US$2,310.115 from Fi Calls Arab Banking Corporation (Jordan) bank account. On or about 26 March 2010 Mr Almhairat withdrew (or transferred to an account controlled by him and/or Apex) US$1,850,000 from Fi Calls Al Mawarid bank account. 56. The respondents declined to respond to the notice to admit or to explain the position. Thereafter, on 9 May 2014 Mr Jeremy Marshall made his 14th statement in support of the application to strike out, alternatively for summary judgment dismissing, paras 70, 71 and 151.5 of the amended points of claim, which are summarised in paras 49 and 50 above. The statement described the nature of the pleaded issues as set out above. It then relied upon the first witness statement, dated 28 October 2013, of an independent accountant, Mr Sumail Nerula, which is based on accounts which showed the payments identified above. 57. The Court of Appeal heard the appeals referred to in detail by Lord Neuberger, beginning on 21 May 2014, although they did not give judgment until the morning of 31 July. In the meantime, on 17 June 2014, there was a directions hearing on the strike out/summary judgment application before Chief Registrar Baister to which the Prince was not of course a party, although Global Torch was. Counsel for Global Torch (Mr Saoul) submitted to the Registrar that, if the Princes appeal to the Court of Appeal succeeded, the issues identified above would have to go to trial. However, he also submitted that the allegations were part of the wider undue prejudice issues so that they were likely to go to trial in any event. He invited counsel for the respondents (Mr Lightman) to identify the true issues between the parties relating to the payment of the US $6m. The Chief Registrar was attracted by that approach but Mr Lightman said that the issue would have to go to trial in any event, if only as between Prince Mishal and the respondents. At best, he said, Global Torch were seeking to strike out allegations only as against themselves, that the issue would survive as against Prince Mishal and that both Global Torch and Prince Mishal would have to give disclosure relating to it. Mr Lightman added (at A/3/45): It is very likely that they [ie Global Torch and Mr Abu Ayshih] will want to put in evidence anyway about this issue. If the summary judgment application fails of course they will have to do it anyway. If it succeeded, clearly they would want to do a proxy defence for the Princes, as they have in the past. Mr Saoul represents the Prince in other hearings. Also they will want to say, We issue a summary judgment application in respect of something, we succeeded, this allegation should never have been made, so this is unfair prejudice. It is fanciful to say that this is a side issue which, if it was disposed of now, would not nevertheless be live at trial. 58. The Chief Registrar said that this seemed to him to be an important issue which, if Mr Lightman was right, should be resolved sooner rather than later. He therefore gave directions for the filing of evidence. 59. Mr William Christopher made a statement on 30 June 2014 on behalf of Apex and Mr Almhairat, in response to the application to strike out and for summary judgment by the Global Torch parties. So far as I can see, while throwing some doubts upon the way the payments were made, Mr Christopher does not say that no payments were made to Fi Call by the Prince. He said in para 9 that Mr Almhairat informed him that he only discovered that Mr Al Masoud had made a payment direct to the Prince on or about 23 February and he was not aware that the Prince had subsequently made any payments into bank accounts of Fi Call which were intended to be in satisfaction of the share purchase monies payable to Apex under the Al Masoud SPA. Mr Almhairat told Mr Christopher that he only became aware of the Global Torch Parties present position when Mr Narulas statement of 28 October 2013 was served. Mr Christopher said that there remained issues of fact, which could only be resolved at a trial after hearing oral evidence in the light of the disclosure given by the parties. Importantly, he noted that the Prince was debarred from defending the proceedings and that Prince Mishal had refused to take part in the proceedings but that the issues would continue to be live at the trial, at the very least in the context of Apexs claim against Prince Mishal and so would be an issue in respect of which the Global Torch Parties would be obliged to give disclosure regardless of the outcome of the application. He concluded that that was a compelling reason why the application should be dismissed even if (contrary to the Apex Parties primary contention) the court were to form the view that Apex had no real prospect of succeeding on the issue against the Global Torch Parties. The Apex Parties also relied upon the first statement of Victoria Middleton, a chartered accountant, dated 30 June 2014 in response to Mr Narulas first statement. She cast doubt on some of his conclusions. 60. Mr Marshall and Mr Narula responded in their seventeenth and second statements respectively, each dated 14 July 2014. Their main point was that the respondents did not rely upon any positive case. In summary they said that it was undisputed that the Prince received the US$10m from Mr Al Masoud. Further, it was accepted that the Prince had paid US$7,999,829 to Fi Call. The Global Torch Parties case was that, of that sum, US$5,984,000 was due to Apex as its share of the share purchase price. In the absence of any explanation to the contrary the only reasonable inference to be drawn was that the monies were intended to be payments for the shares under the Al Masoud SPA and that the Prince had accounted to Apex for its share of the proceeds by paying the money to Fi Call. It is true that the monies were paid to a Fi Call bank account other than that provided for in the SPA but there is no evidence that anything turns on that. On the contrary, as I see it, based on the evidence which was available in July, there was no arguable case that payment to a Fi Call company did not have the effect of accounting to Apex for the US$5,984,000 in respect of the price of the shares. As stated in para 4 above, the Apex parties pleaded that payment under the Al Masoud SPA was to be by payment into a Fi Call bank account and that Fi Call would receive the monies as agent for Apex and Global Torch respectively. I note in passing that in a solicitors letter dated 24 May 2012 the Apex Parties case was advanced on the basis that Mr Al Masouds payment should be paid into Fi Calls bank account and that this 61. would have been received by the Company as agent for Apex and as agent for Global Torch, although it was envisaged that the Company might subsequently be permitted 62. 63. to retain some or all of the money by way of loans from Apex and Global Torch. In these circumstances, viewed on the basis of that evidence, the Apex parties had no defence to the application for summary relief because Fi Call had received approximately US$6m on behalf of Apex and there was no basis upon which the Prince could have been held separately liable for it. In the absence of a satisfactory explanation, there is also force in the point that a reasonable inference can be drawn from the fact that on or about 15 and 26 March 2010 Mr Almhairat withdrew (or transferred to an account controlled by him and/or Apex) the sums of US$2,310.115 and US$1,850,000 from Fi Calls Arab Banking Corporation (Jordan) and Mawarid bank account respectively. They were the opening balances in each account. The inference is that the monies used came from Mr Al Masoud and that Mr Almhairat regarded those sums as his to use. 64. No positive case was made by the Apex Parties at any time before the matter came before Hildyard J on the afternoon of 31 July 2014, which was after the Court of Appeal had given judgment that morning. Both the transcript of the hearing and of his judgment, which is now available, are in my opinion instructive. They show that, although he declined to grant either of the Global Torch Parties applications for summary relief, he made it clear that he would have granted summary relief but for the fact that the trial was so soon. 65. Hildyard J had before him the evidence to which I have referred above. The position was explained to him by Mr Fenwick, who was representing the Global Torch Parties, in much the same way as I have set it out above. With respect to Mr Lightman, who represented the Apex Parties before the judge, it is far from clear what their case was. He accepted that some payments were made into Fi Calls accounts. He at first suggested (at A8/124) that his clients did not regard the payments as accounting for the monies due to them under the SPA. He suggested that the Prince was lending money to the company. The judge asked him whether Apex thought the payments were a loan. He said that it was unclear what they were, whereupon the judge said that his clients had not been very forthcoming as to what they thought (A8/125). As I see it, the difficulty for them was that, while for the purposes of this application they were saying that there was a triable issue, their pleaded case was that the Prince held the monies for them on the basis that he had received monies from Mr Al Masoud as agent or trustee for them. Yet, as stated above, there was strong evidence that those monies were paid into the Fi Call company accounts referred to above for the benefit of the shareholders. However that may be, Mr Lightman told the judge at A8/125 that his clients 66. were saying that there was a triable issue as to the extent to which the Prince discharged his obligation as trustee. In giving judgment, Hildyard J expressed some concern (at A9/137/para 3) that, if the decision of the Court of Appeal stood, with the result that the Prince owed US$6m, and it was subsequently held that Apex had been paid, that would give rise to an inconsistency and, one might have thought, some anxiety. As I read paras 4 to 6 of the judgment, the judge would have afforded the Global Torch Parties a summary remedy disposing of the Apex parties claim but concluded that the safest course was to allow the issue to go to trial. He said at A9/138 139: 4. If the respondents are right in the matter now, they will be right then. It is not suggested that the trial will be seriously disrupted if the issue is held over until then: it is of short compass. 5 Accordingly I have approached the matter by reference to what is loosely described as the approach in Williams & Humbert Ltd v W&H Trade Marks (Jersey) Ltd [1986] AC 368 and I have sought simply to weigh the advantages and disadvantages of dealing with the matter now, safe in the knowledge that the ultimate merits will not spoil. As I have said, my initial instinct and my abiding instinct is that the balance is in favour of allowing the matter to proceed. I say that with particular regard to an argument which may or may not be proved correct, which was raised by Mr Lightman, that it is inevitable that the issues regarding the $6m, even if decided on a point of liability, will be ventilated on the broader questions which arise in the petition. These include issues as to the honesty of Mr Almhairat generally and in procuring this claim to be brought forward, it being my assumption that if at any stage he had accepted and told his solicitors that he accepted payment, that should of course have been reflected in the claim being withdrawn. 6. I do this in some senses with a heavy heart because, notwithstanding the general rule that the court at this stage should not poison the water, I should say by way of warning that as matters presently appear to me at this stage, the arguments on behalf of the petitioners seem, if I can put it lightly, frail. I quite understand that they may be entitled to contend that it is the third respondent who agreed to accept the monies in effect as a fiduciary and who bears the responsibility of explaining each and every twist and turn and has not done so. But I consider there to be at least a powerful argument that if receipt is demonstrated and not allocated to any other reason, that will conclude the matter against the petitioners. I do not dare in a sense say more than that, since to say more would falsify my approach of leaving the matter over for determination at trial. But I do caution the petitioners in persisting with this and call upon them to exercise restraint and utmost care. If at trial it were to emerge that there was never any proper defence, though I cannot tie the hands of the trial judge which may very well be myself I would expect the trial judge to separate out these costs and make the strongest possible order in respect of them. 67. For the reasons given above, I agree with Hildyard J that, but for the reasons advanced by Mr Lightman why the matter should proceed to trial, this would have been a proper case for summary disposal based upon the strength of the Global Torch Parties case and the failure on the part of the Apex Parties to advance an arguable defence. What then changed thereafter? 68. There was further evidence before us in the form of the sixth and seventh statements of Mr Almhairat which were dated 8 September and 6 October 2014 respectively. They were prepared for the trial and thus cover many different aspects of the dispute, including the issues discussed above. They were put before this court without demur. In para 43 of the sixth statement he says that on 1 November 2009 the Prince entered into a loan agreement with Fi Call under which he agreed to lend up to US$20m to Fi Call. In para 46 he says that the Prince advanced 1m to Fi Call pursuant to that loan facility. There is however no evidence that any of the monies referred to above were part of a loan. 69. 70. The sixth statement accepts at para 62 that on or about 7 February 2010 Mr Al Masoud (or someone at his request) paid the sum of US$10m to the Prince. He says in para 63 that Apex has never received any of the purchase price paid to the Prince. He says in para 64 that he has seen that it is alleged that the Prince paid about US$6m into various accounts of Fi Call in February and March 2010, although he says that he was not aware of it. He further says that, if it is said that those payments are proceeds of the Al Masoud SPA, neither he nor Apex agreed to its share being paid to the Company rather than Apex. This is odd in circumstances where the SPA originally provided to the monies to be paid to a Fi Call account, namely HSBC. 71. 72. 73. 74. 75. It is fair to say that Mr Almhairat does give an explanation in paras 65 to 68 for the receipt of US$4.41m referred to in para 52 above. He says that it was a loan agreed to by the Prince and the other Global Torch Parties, that some of it was paid back and that he ultimately received a net loan of US$2.1m. In Mr Almhairats most recent statement, the seventh, which was dated 6 October 2014, he again focuses on payments that the Global Torch parties say were paid to the Prince and then to various Fi Call accounts. He now says (contrary to para 64 of his sixth statement) that he was aware that the sums set out above had been paid into Fi Calls accounts. As to their source, he simply says that he did not know precisely where they had originated, although he understood that they had been paid by the Prince or on his behalf. He says that he did not understand that they were the proceeds of the Al Masoud SPA. It is thus unclear on what basis he now says that the Prince was liable to him for the US$6m. In the remainder of the seventh statement Mr Almhairat speculates that the Prince used money paid into the various Fi Call accounts to discharge various obligations of his own, to make transfers to his other accounts and to facilitate what he calls the Princes money laundering activities referred to in the pleadings as the Beirut Transaction (at paras 13 et seq). This statement has been prepared for the trial and gives some indication of the issues at the trial. It appears to me that there may be a close relationship between the Princes alleged liability for US$6m and the shareholders liabilities inter se which will are likely to be the subject matter of dispute at the trial. I recognise, however, that ultimately the question of what issues are to be determined at the trial are matters for the trial judge. In all these circumstances it seems to me (as I stated at the outset) that the just disposal of this appeal would be to allow the appeal to the extent of setting aside the default judgment against the Prince but ensuring that the monies secured by the undertaking referred to above would be available to Apex if they succeed at the trial. I recognise the force of the points made by Lord Neuberger in paras 22 to 27 of his judgment. However, I am of the opinion that each case depends upon its own facts and that it is almost always wrong in principle to disregard the underlying merits altogether as irrelevant. In paragraphs 28 to 35 Lord Neuberger expresses the view that the merits will be relevant where party has a case whose strength would entitle him to summary judgment. Although I entirely agree that the court should not conduct a trial of the issues, I would not limit the relevance of the merits to such a case. On an application for summary judgment it is not uncommon for the judge to refuse summary judgment but only to grant leave to defend on terms that the defendant pays the amount in dispute into court (or otherwise provides satisfactory security) in order to permit the defendant to advance what the judge thinks is a weak case provided that the claimants claim is secured. 77. 76. On a summary judgment application the court has power to make a conditional order: see CPR 24.6.1 and 24PD5 under which it may order a party to pay a sum of money into court. In volume 1 of Civil Procedure, para 24.6.6 notes that in Olatawura v Abiloye [2002] EWCA Civ 998, [2003] 1 WLR 275 Simon Brown LJ gave guidance as to the court's approach to the making of conditional orders requiring a party advancing an improbable case to give security for their opponent's costs. In the present case, for the reasons given above, it is Apex that has the improbable case on the merits, not the Prince. Apex would be fully protected if my proposed order were made. I appreciate that, as Lord Neuberger observes, there is now a good deal of evidence which was not available to the Court of Appeal. However, that is in large part due to the fact that the proceedings before Hildyard J took place after the decision of the Court of Appeal and evidence relevant to the trial has been put before this court. Those circumstances make this a very unusual case. I would add that, notwithstanding the position as it was before Norris J as explained in para 15 of his judgment delivered on 9 September 2013, nobody suggested before Hildyard J (or this court) that it will not now be possible to have a fair trial because of the Princes breach of the orders which led to judgment being entered against him. That seems to me to be a further reason why it would be disproportionate not to afford the Prince relief. 78. For my part, I hope that, if it is established at the trial that the Prince did account for the US$6m as he says he did, it will be possible for that fact to be taken into consideration in resolving the issues between the parties. 79. Finally, I would like to express my agreement with para 39 of Lord Neubergers judgment. As to para 40, as in his case, nothing in this judgment is intended to impinge on the decision or reasoning of the Court of Appeal in Mitchell or Denton. Postscript 80. I learned of the developments referred to by Lord Neuberger in his para 42, only after completing paras 46 to 79 above. As to those developments, I agree with the approach described by Lord Neuberger in his paras 42 to 44. Subject to arguments based on (i) general disproportionality, (ii) the fact that there will be a trial in any event, and (iii) the strength of the Princes case (arguments which I consider in the next three sections of this judgment), it appears clear to me, as it did to the Court of Appeal, that the decisions of Vos J, Norris J and Mann J, as summarised above, cannot be faulted. It was suggested on behalf of the Prince by Mr Fenwick QC and Mr Saoul (neither of whom appeared before Vos J or Norris J) that Vos J erred in making the order in paras 14 and 15, because he mistakenly believed that this was the usual order. The fact that Vos J and the Court of Appeal (see per Arden LJ in the Court of Appeal at para 44) considered that it was the usual order to make renders it very hard for this court to take a different view. However, while it is unnecessary to decide the point, I incline to the view that the standard form of disclosure by a party does require personal signing by the party. CPR 31.10(6) refers to a disclosure statement as being a statement made by the party disclosing the documents, and the notion that it should be the party himself also seems to get support from CPR 31.10(7). Similarly, that conclusion is supported by para 4 of PD31A, especially sub paras 4.2, 4.3, 4.4 and 4.7 (and also the annex to PD31A). It also seems clear that, no doubt when good reasons are made out, the court can permit a departure from this see CPR 31.5(1)(a) and (b). It is true that para 3.7 of PD22 specifically permits a statement of truth to be signed by a partys solicitor and that para 15 of the Order referred to statements of truth not disclosure statements. However, it seems to me that, although it referred to statements of truth, para 15 was actually referring to disclosure statements a view supported by paras 1.1 and 1.4 of PD22 and CPR 22.1(1).

This appeal arises out of a joint venture between Apex Global Management Ltd (Apex), a Seychelles company owned by Mr Almhairat, and Global Torch Ltd (Global), a British Virgin Islands company owned by Prince Abdulaziz (the Prince), Mr Abu Ayshih and Mr Sabha. Apex and Global set up an English company Fi Call Ltd (Fi Call), and then fell out badly. In December 2011, Global issued a petition under sections 994 996 of the Companies Act 2006 against Apex, Mr Almhairat and Fi Call seeking share purchase orders, and pecuniary and declaratory relief. Ten days later, Apex issued a very similar cross petition against the Prince, the Princes father Prince Mishal, Global, Mr Abu Ayshih, and Fi Call. Allegations and counter allegations of seriously unlawful misconduct are involved, including money laundering, financial misappropriation, and funding of terrorism. The two petitions were ordered to be heard together. The relief sought by Apex included a claim for just under US$6 million plus interest, which it contended was owing to Apex by the Prince. The Prince denied that the $6m was owing on the ground that he had paid it into the bank account of certain companies. In July 2013 Vos J made a number of directions, including that each party file and serve a disclosure statement certified by a Statement of Truth signed personally. The Prince, who had objected to the order, failed to comply. This was on the basis that, as a member of the Saudi Royal Family, he was bound by a protocol which prevented him from taking part in litigation personally or from signing court documents. Apex applied to Norris J for, and obtained, an order that unless the Prince complied with the order, and in particular signed a Statement of Truth, his Defence be struck out and judgment be entered against him (an Unless Order). The Prince maintained his position and Apex applied to Norris J for, and obtained, judgment in its favour under Civil Procedure Rules (CPR) r.3.5(2). The Prince applied under CPR 3.1(7) for a variation of the Vos Js order and for relief from sanctions. Mann J refused to vary Vos Js order and rejected the application for relief from sanctions under CPR 3.9. In July 2014, Hildyard J refused an application for summary judgment in relation to the question of whether the $6m had in fact been repaid. The Prince unsuccessfully appealed the decisions of Vos J, Norris J and Mann J to the Court of Appeal, and was given permission to appeal to the Supreme Court on terms that he paid $6m to his solicitors to abide the order of the Court. The issue in this appeal is therefore whether The Prince is entitled to the relief he seeks. The Supreme Court dismisses the appeal by a majority of 4 1. Lord Neuberger (with whom Lord Sumption, Lord Hughes and Lord Hodge agree) gives the main judgment. Lord Clarke gives a dissenting judgment. The language of the CPR and of the relevant Practice Direction suggests that the standard form of disclosure by a party does require personal signing by the party and such an order reflected the normal practice [12 13]. Vos Js decision to make the order was well within the margin accorded to case management decisions [15]. Similarly, the approaches taken by Norris J to making an Unless Order and of Mann J to refusing relief from sanctions each represented a correct approach in principle and a careful consideration of the competing arguments, and Norris Js second decision was almost administrative in nature [18]. The decisions of Vos J, Norris J and Mann J are individually unassailable [20 21]. The contention that the consequence of these orders is disproportionate is difficult to maintain; the importance of litigants obeying court orders is self evident and if the disobedience continues notwithstanding the imposition of a sanction, the enforcement of the sanction is almost inevitable [23]. There are no special factors which justify reconsidering the original orders, and the Prince had two very clear opportunities to comply with the simple obligation to give disclosure in an appropriate fashion. [24 25]. The strength of a partys case on the ultimate merits of the proceedings is generally irrelevant when it comes to case management issues of this sort, though there may be an exception where a party has a case the strength of which would entitle him to summary judgment. A trial involves directions and case management decisions, and it is hard to see why the strength of either partys case should, at least normally, affect the nature or the enforcement of those directions and decisions [29 31]. The Prince would have a good prospect of establishing that the $6m was paid as he contends in his defence, but his prospects cannot be said to be any higher [33]. It is true that the question of whether the Prince has paid may be determined in the very proceedings which he would have been debarred from defending. However, it is inherent in orders such as default judgment that the claimants will obtain judgment for relief to which it may subsequently be shown they were not entitled. [36 37]. The Supreme Court should be very diffident about interfering with the guidance given or principles laid down by the Court of Appeal when it comes to case management and application the CPR [39]. Lord Clarke would have allowed the appeal on the basis that justice requires that the Prince should be allowed to challenge the claim against him, and all parties would be protected because the court would be able to resolve all the issues between the parties [46]. Lord Clarke would not limit the relevance of the merits to a case where the strength of a partys case would entitle him to summary judgment. [75]. Nobody had suggested that it will not be possible to have a fair trial because of the Princes breach of the orders which led to judgment being entered against him [77]. Lord Clarke agrees with Lord Neubergers comments on the role of the Supreme Court in relation to case management and the CPR [79]. Postscript After the oral argument on this appeal had been concluded and the Court had notified the parties of its conclusion, but before judgment was handed down, the Court was advised of recent judgments of Hildyard J in the principal action, given on 3 and 5 November, when he reluctantly adjourned the trial to 2015 on the application of Mr Almhairat. It would not be right for this Court to address the question whether to reconsider its decision to dismiss the Princes appeal in the light of these developments, and in particular in the light of any breaches of the CPR or any orders by any of the Apex parties. If, in the light of events which have occurred since the Court heard and decided the Princes appeal, reconsideration, revocation or modification of any of the orders is appropriate then that is a matter which should be raised before a Judge of the Chancery Division, who should also be responsible for deciding how the $6m should be dealt with [42 44].

8k-16k

This appeal arises out of the payment of value added tax which was not due, because the supplies in question were exempt from VAT under the relevant EU directive. At the time of the payment, however, the supplies were treated as taxable by the UKs VAT legislation, which had incorrectly transposed the directive, and were mistakenly believed to be taxable by the customer who paid an amount charged in respect of the tax, the supplier who received that amount, and the Commissioners to whom the supplier accounted for the tax. As the corollary of the supplies being believed to be taxable, the supplier and the Commissioners also believed that the supplier was entitled to deduct from the tax chargeable on its supplies to customers the tax which it had itself paid on taxable supplies received for the purposes of its business. It therefore accounted to the Commissioners for the tax chargeable on its supplies during each accounting period on the basis that it could deduct and retain the amount of the tax which it had paid to its own suppliers, and it paid the Commissioners only the remaining surplus, if any. In that situation, does the customer have a common law claim against the Commissioners for restitution, or is he confined to a claim against the supplier? If he has a claim against the Commissioners, is it for the entire amount which he paid to the supplier, or only for the amount, if any, which the Commissioners received from the supplier? Does it make a difference if any claim for restitution by the supplier against the Commissioners is time barred? Does it make a difference if there is a statutory scheme under which the customer can obtain reimbursement of the amount which the supplier paid to the Commissioners, but not of any amount which was retained by the supplier? Furthermore, if the statutory scheme has the effect of excluding a common law claim by the customer against the Commissioners, is that compatible with EU law? These are the principal issues which the court has to decide. The factual background The claimants are investment trust companies (ITCs). They are closed ended investment funds constituted as limited companies: that is to say, the companies were established with a fixed number of issued shares and a term date when the company would be wound up and the assets distributed to the shareholders. They have now reached their term dates and are in winding up. The claims of three of the ITCs (the Lead Claimants) have been taken forward as lead claims while the others are stayed to await the outcome of these proceedings. The Lead Claimants are Kleinwort Overseas Investment Trust plc, F&C Income Growth Investment Trust plc, and M&G Recovery Investment Trust plc. They will be referred to respectively as the Kleinwort Trust, the F&C Trust and the M&G Trust. Between 1992 and 2002 the Lead Claimants received supplies of investment management services from their investment managers (the Managers). Those were respectively Kleinwort Benson Investment Management Ltd, F&C Asset Management Ltd and M&G Investment Management Ltd. Their services were rendered under contracts which provided for the Managers to be paid fees plus VAT if applicable (or words to similar effect). Under the provisions of the UK VAT legislation then in force, those services, unlike the other investment management services provided by the Managers, did not qualify for exemption. The Managers therefore charged VAT on the supplies of their services. The VAT charges were separately identified on the VAT invoices issued to the Lead Claimants, and the Lead Claimants paid the amounts charged. The Managers were obliged to account to the Commissioners for the VAT due in respect of their chargeable supplies during each accounting period. It is relevant to note that the obligation to account for tax arises whether or not tax is charged on the supply or paid by the customer: it is the supplier, rather than the customer, who is under a liability to the Commissioners, and it is the supply, rather than payment by the customer, which triggers the suppliers liability. The customers liability to pay an amount in respect of the tax rests upon contract. The Managers obligation to account for the tax due did not, however, mean that they were obliged to pay the Commissioners the whole of, or indeed any part of, the sums they received from the Lead Claimants. Under general principles of VAT law, they were entitled to deduct from the tax chargeable in respect of any taxable supplies they had made, known as output tax, the tax chargeable in respect of any taxable supplies which they had received for the purpose of their business of making taxable supplies, known as input tax. It therefore followed from the legislative treatment of the services supplied to the Lead Claimants as taxable, that the Managers were understood to be entitled to pay to the Commissioners only the surplus of their output tax over their input tax, and to retain the balance of the output tax in their own hands. If the input tax exceeded the output tax, they were entitled to a credit, which could be paid by the Commissioners or carried forward to later accounting periods. Thus, for example, if a Manager made taxable supplies to an ITC, and the VAT chargeable on those supplies was 100, then the Manager was bound to account to the Commissioners for 100. If the Manager had purchased taxable supplies during the relevant period on which the VAT was 25, the Manager was entitled to credit for that 25, and was required to pay the Commissioners only the balance of 75. It was also possible for an ITC to be registered for VAT (if it invested in securities outside the EU), and in that event to recover, as input tax, some of the VAT which it had paid to its Manager. The F&C Trust and the M&G Trust made no such supplies, but the Kleinwort Trust did, and recovered 58.4% of the VAT charged by its Manager (that being the percentage of its portfolio which was invested outside the EU). Its claim against the Commissioners has therefore been adjusted to take account of the sums which it has already recovered as input tax: rather than claiming every 100 which it paid to its Manager in respect of VAT, it claims 41.60, being the difference between the 100 and the 58.40 which it recovered as input tax. The essential pattern was therefore as follows: 1. The Managers supplied investment management services to the Lead Claimants under contracts providing for the payment of fees plus VAT if applicable. 2. The Managers charged the Lead Claimants VAT on the supply of those services, and included the VAT charges on the invoices which they issued to the Lead Claimants. 3. The Lead Claimants paid the invoices. They might or might not be able to recover some of the VAT as input tax. 4. The Managers made periodic VAT returns in which they: accounted for the VAT chargeable on their supplies of (i) investment management services as output tax; (ii) deducted as input tax the VAT which they had paid to third parties for supplies received in the course of their business; and (iii) paid the difference between their output tax and input tax to the Commissioners. It transpired that the supplies of the investment management services were exempt from VAT under article 13B(d)(6) of the Sixth VAT Directive (77/388/EEC). That was established by the European Court of Justice in JP Morgan Fleming Claverhouse Investment Trust plc v Revenue and Customs Comrs (Case C 363/05) [2007] ECR 1 5517. Although the UK failed to transpose article 13B(d)(6) correctly into national legislation until 1 October 2008, it had direct effect at all material times. It is therefore common ground between the parties that the Lead Claimants paid the Managers the amounts they did in respect of VAT, and that the Managers accounted for VAT to the Commissioners, under a mistake of law. The Managers claims against the Commissioners In early 2004, when the Claverhouse litigation began and was publicised, the Managers of the F&C Trust and the M&G Trust made claims to the Commissioners under section 80 of the Value Added Tax Act 1994 for refunds in respect of VAT accounting periods from 2001 to 2004. It will be necessary to return to section 80, the material provisions of which are set out in para 75 below. Claims were not made in relation to earlier accounting periods because of the three year limitation period imposed by section 80(4). For the same reason, no claim was made by the Managers of the Kleinwort Trust, which had gone into winding up in 1998. Following the Claverhouse judgment, the Commissioners allowed the claims and repaid the relevant amounts (as will be explained shortly) to the Managers, with interest. In accordance with section 80, and regulations made pursuant to section 80A, the Commissioners required the Managers to enter into approved reimbursement arrangements with the Lead Claimants, so that the refunded VAT and interest were passed on by the Managers to them. Subsequently, the decision of the House of Lords in Fleming (trading as Bodycraft) v Revenue and Customs Comrs [2008] UKHL 2; [2008] 1 WLR 195 established that the retrospective manner in which the three year limitation period had been introduced (by an amendment to the 1994 Act, effected by the Finance Act 1997, which reduced the previous period) was incompatible with EU law, and that the time bar had to be disapplied in respect of rights which had accrued before it came into effect on 4 December 1996. The Managers then made further claims in respect of accounting periods ending before that date. These claims were again allowed, with interest, and the appropriate repayments were made to the Managers, who in turn passed them on to the Lead Claimants. As a result of these arrangements, the Lead Claimants were refunded the VAT which they had paid to the Managers, subject to two exceptions. First, the Managers were unable to make claims in respect of accounting periods ending on or after 4 December 1996 which were time barred under section 80(4). In practice, that meant that claims could not be made by the Managers of the Kleinwort Trust in relation to accounting periods ending between 4 December 1996 and 20 March 1998, when the Kleinwort Trust went into liquidation. The corresponding periods in relation to the F&C Trust and the M&G Trust ended on 6 and 1 April 2001 respectively. Those periods have been referred to in these proceedings as the dead periods. It is common ground that the limitation period in section 80(4) is compatible with EU law. Secondly, the amounts repaid to the Managers were calculated on the basis that, under section 80(2A), it was necessary to set against the output tax for which they had accounted, the amount of the input tax which they had deducted. It is a matter of agreement that that was the correct approach to the application of section 80. In the illustrative example given in para 6 above, that means that the Managers were entitled to repayment of the 75 which they had paid to the Commissioners, but not of the 25 which they had retained in their own hands. It is a matter of agreement that, although the Managers were only entitled under section 80 to reimbursement of the notional 75, the Commissioners could have made the refunds conditional on the Managers undertaking to repay to the Lead Claimants the full amount which they had been mistakenly charged (ie, the notional 100). It is agreed that the Commissioners did not do so because they accepted the Managers assertion that, if they had known that the input tax was non deductible, they would have passed on that cost to the Lead Claimants by charging a higher price for their services. In the present proceedings, however, it is accepted that that assertion was erroneous: had the true position been known, the Managers would not have sought to increase the price of their services to the Lead Claimants. Instead, as Henderson J found after trial, they would have absorbed the input tax as a business expense. In the event, the notional 25 was later refunded to the Kleinwort Trust and the F&C Trust by their respective Managers, but it was not refunded to the M&G Trust. The proceedings below The ITCs brought proceedings against the Commissioners in which they sought payment of the amounts which had been paid by them to their managers, to the extent that they had not been recovered under the statutory scheme established by section 80 or otherwise: in other words, the amounts which the managers could not claim because any claim would be time barred, and the amounts which the managers had not paid to the Commissioners but had retained and set against input tax (unless those amounts had been refunded to the ITC in question by its manager). The ITCs claims were based on unjust enrichment, or alternatively on EU law. The claims of the Lead Claimants proceeded to a trial on liability. After trial, the judge held [2012] EWHC 458 (Ch): 1. That, using the notional figures referred to above, the Commissioners had been enriched in the full amount of 100, even if only 75 was paid to them by a Manager after deducting 25 in respect of input tax paid to its own suppliers. In the judges view, although the 25 was not paid to the Commissioners, it was nevertheless used by the Commissioners to give the Managers a credit for that input tax. 2. That the Commissioners were enriched at the expense of the Lead Claimants because, in economic terms, the person at whose expense the VAT was paid was the customer. The enrichment was also unjust. 3. That a cause of action in unjust enrichment was, however, excluded under domestic law by section 80(7) of the 1994 Act, which protects the Commissioners from liability other than as provided in that section. 4. That the Lead Claimants had a directly effective right to repayment against the Commissioners under EU law, which required a remedy to be made available in respect of the full notional 100, not merely the 75. 5. That EU law did not, on the other hand, require national law to give the Lead Claimants any remedy in respect of amounts falling within the scope of the time bar imposed by section 80(4). Any EU based claims would be subject (in effect) to the same limitation period. In a subsequent judgment [2013] EWHC 665 (Ch), which had been deferred pending the decision of this court in Test Claimants in the FII Group Litigation v Revenue and Customs Comrs [2012] UKSC 19; [2012] 2 AC 337, and the judgment of the Court of Justice in Littlewoods Retail Ltd v Revenue and Customs Comrs (Case C 591/10) [2012] STC 1714, the judge further held that the Lead Claimants had no Woolwich claim under English law for unlawfully levied tax (ie a claim based on the principle established in Woolwich Equitable Building Society v Inland Revenue Comrs [1993] AC 70), and that EU law required section 80(7) to be disapplied, so as to permit a mistake based restitutionary claim. It is unnecessary to consider the Woolwich issue further, as the point has not been pursued in the present appeal. In the light of these conclusions, the judge gave judgment for the M&G Trust in respect of the notional 25 (defined as the difference between the amounts paid by the M&G Trust to its Manager as VAT and the amount of the refunds it received from its Manager, and also as equalling the input tax brought into account by its Manager) for periods outside the dead period, and dismissed the claims in relation to the dead periods (the dead period in relation to each claimant being the period for which its Manager was unable, for reasons of limitation, to make a claim under section 80). The Lead Claimants appealed against the first judgment on the grounds that the judge was wrong to conclude (i) that a cause of action in unjust enrichment against the Commissioners was excluded by section 80(7) of the 1994 Act, and (ii) that the Lead Claimants had no claim under EU law to VAT paid in respect of the dead periods. The Commissioners also appealed against the first judgment on the ground that the judge was wrong to conclude that the M&G Trust had a directly effective EU law right to recover from the Commissioners the 25 element of its claim for accounting periods outside the dead period, and they appealed against the second judgment on the ground that the judge had erred in holding that section 80(7) was to be disapplied. The Court of Appeal (Moore Bick, Patten and Beatson LJJ) [2015] EWCA Civ 82 allowed both parties appeals. It held: 1. That the judge had been right to conclude that the Lead Claimants had a direct cause of action in unjust enrichment against the Commissioners for VAT paid under a mistake of law. 2. That he had been wrong to treat this cause of action as excluded by section 80(7). 3. That he had been wrong to conclude that the notional 25 retained by the Managers represented the discharge of any subsisting obligation to refund that amount on the part of the Commissioners, and that, accordingly, the Commissioners could not have been enriched by more than the notional 75 for any of the accounting periods in question. Any domestic claim in unjust enrichment for the notional 25 lay against the Managers alone. 4. That the Lead Claimants had no direct claim against the Commissioners for the notional 25 under EU law, given the claim they had in that amount against the Managers. The Court of Appeal therefore allowed the Lead Claimants appeal, to the extent of the notional 75 paid in respect of dead periods, and allowed the Commissioners appeal in respect of the notional 25. In this appeal by the Commissioners against the decision of the Court of Appeal (in respect of the notional 75 paid in respect of dead periods), and cross appeal by the Lead Claimants (in respect of the notional 25), there are three key questions. First, did the Lead Claimants have a common law claim against the Commissioners in principle, subject to any statutory exclusion of such a claim? Secondly, if so, did section 80 of the 1994 Act bar such a claim? Thirdly, if the Lead Claimants have no claim against the Commissioners, either because no such claim is recognised at common law or because a common law claim is barred by section 80, is that compatible with EU law? The common law claim The Lead Claimants argue that customers who pay undue VAT charged by their supplier have a claim against the Commissioners based on unjust enrichment, unless such a claim is excluded by statute. The first question is whether that is correct. If not, that in itself provides an answer to the claims made in these proceedings, subject to any issue arising under EU law. In answering the question, both parties followed the approach adopted by Lord Steyn in Banque Financire de la Cit v Parc (Battersea) Ltd [1999] 1 AC 221, 227, and asked: (a) Has the defendant been benefited, in the sense of being enriched? (b) Was the enrichment at the claimants expense? (c) Was the enrichment unjust? (d) Are there any defences? Were the Commissioners enriched? There is no dispute that the Commissioners were enriched to the extent of the notional 75. What is in dispute is whether they were also enriched to the extent of the notional 25 which they did not receive. The judge held that they were. Although the 25 was not paid to the Commissioners by the Managers, it enriched the Commissioners, in his view, by being set against the input tax which the Commissioners would otherwise have been obliged to pay or credit to the Managers: that is to say, the tax which the Managers had paid on the goods and services supplied to them for the purposes of their business of supplying investment services. The Court of Appeal considered this reasoning to be fallacious on the basis that if the supply of services by the Managers was not taxable, then the Managers had no right to deduct as input tax the VAT which they had paid to their own suppliers. The Managers retained the notional 25 in satisfaction of what the court regarded as a purported obligation, on the part of the Commissioners, which never existed. The Commissioners did not, therefore, benefit from the Lead Claimants payment of the notional 25. An order compelling them to pay that amount to the Lead Claimants would not reverse an enrichment but leave them worse off, having received 75 and made restitution of 100. Any claim to restitution of the 25 should therefore have been directed against the Managers. In this appeal, counsel for the Lead Claimants argued that when the 25 was paid to the Managers, the position under the applicable UK legislation was that the Managers were entitled to deduct their input tax in satisfaction of an obligation owed to them by the Commissioners. They continued to be entitled to account to the Commissioners for VAT, notwithstanding that it was not lawfully due under EU law, and therefore remained entitled to claim reimbursement in respect of input tax, until the position under UK law was changed: Becker v Finanzamt Mnster Innenstadt (Case C 8/81) [1982] ECR 53; VDP Dental Laboratory NV v Staatsecretaris van Financin (Joined Cases C 144/13, C 154/13 and C 160/13) [2015] STC 1133. The Court of Justice had rejected the argument that a domestic levy which was incompatible with EU law was to be treated as having never existed: Ministero delle Finanze v IN CO GE90 Srl (Joined Cases C 10/97 to C 22/97) [1998] ECR I 6307. I am unable to accept this argument. The case of Ministero delle Finanze v IN CO GE90 Srl merely establishes that national legislation which is incompatible with EU law, although inapplicable in so far as it is incompatible, is not a nullity for all purposes. The case concerned claims for the repayment of a charge which had been levied under Italian legislation which was inconsistent with EU law. A preliminary issue before the national court was whether the claims fell within its jurisdiction: an issue which turned on whether they were of a fiscal or a civil nature. The question which troubled the national court was whether, in deciding that issue, it should treat the national legislation as set aside in its entirety, or whether it could have regard to the legislation for the purpose of characterising the nature of the relationship between the parties at the time when the contested amounts were paid. The Court of Justice held that, subject to compliance with the principles of non discrimination and effectiveness, the detailed rules which applied for the repayment of a charge, and the classification for that purpose of the legal relationship established when the charge was levied, were matters to be determined under national law (para 26). The cases of Becker and VDP Dental Laboratory are more directly in point. In the former case, VAT had been levied under domestic law in respect of services which were exempt under the relevant directive, and an issue was raised as to the consequences of granting the exemption retrospectively after the mistake was discovered. In the course of its judgment, the Court of Justice stated that, by availing themselves of an exemption from VAT, persons entitled to the exemption necessarily waived the right to claim a deduction in respect of input tax (para 44). An analogous conclusion was reached in the VDP Dental Laboratory case, where an exemption provided for under national law was incompatible with the relevant VAT directive. The court held that the taxable person was not entitled both to benefit from the exemption and to exercise the right to deduct input tax (para 40). It follows from these authorities that the Managers could not both claim reimbursement of the output tax which they had paid to the Commissioners, under section 80 of the 1994 Act, on the basis that their supplies were exempt from VAT, and simultaneously assert an entitlement to retain the amounts which they had deducted as input tax, on the basis that their supplies were taxable. The Commissioners were not, therefore, enriched by the Managers retention of the notional 25, and the Managers have, in principle, no defence to a claim by the Lead Claimants for the restitution of that amount. That conclusion is as one would expect. The Lead Claimants claim to restitution against the Commissioners proceeds on the basis that the supplies which they received from the Managers were exempt from VAT. That being so, it would be surprising if they could present that claim, in relation to the measure of restitution, on a basis which was predicated on the supplies being taxable. notional 75. Was the enrichment at the Lead Claimants expense? There is no doubt that, in economic terms, the Commissioners were enriched at the expense of the Lead Claimants. On the mistaken premise that the supplies were taxable, the Lead Claimants were charged tax by the Managers, and paid it to them in accordance with their contract. On the same premise, the Managers were obliged to account to the Commissioners for the tax chargeable on their supplies, and to pay them the output tax in respect of each accounting period, after deducting their input tax. The net result of the mistake was that the Lead Claimants were worse off by the amount of the Managers output tax, and the Commissioners were better off to the extent that that amount exceeded the Managers input tax. It follows that the Commissioners enrichment was only to the extent of the As the judge noted, however, no payment was made by the Lead Claimants to the Commissioners. Nor were the Managers simply a conduit or, in legal terms, an agent for payment by the Lead Claimants to the Commissioners. The Lead Claimants owed no money to the Commissioners. Furthermore, the payment of the tax element of the invoices submitted by the Managers to the Lead Claimants was not the cause of the payment of tax by the Managers to the Commissioners: as explained earlier, the Managers were liable to account for tax to the Commissioners once they had supplied the relevant services. As the judge found, it could not be said that the tax would not have been paid but for the payments by the Lead Claimants to the Managers. In these circumstances, it was argued, the Lead Claimants remedy lay against the Managers, as the recipients of the mistaken payments which they had made, leaving it to the Managers to recover from the Commissioners any amount which they had mistakenly paid to them in accordance with the legislation. After considering the limited guidance provided by the modern English authorities, and English academic opinion, the judge concluded that, as a general rule, a defendant was legally enriched at the expense of the person from whom the benefit in question was directly received. There were, however, exceptions to that general rule. Without attempting to be exhaustive, he listed a number of relevant criteria for identifying such exceptions, which he derived from the authorities: put shortly, the need for a close causal connection between the payment (or other provision of a benefit) by the claimant and the enrichment of the defendant, the need to avoid the risk of double recovery, the need to avoid conflict with contracts between the parties, and the need to distinguish between unjust enrichment and compensation or damages. Applying that approach, he regarded the present case as exceptional. First, to allow the Lead Claimants to recover from the Commissioners would not, in his view, involve any risk of double recovery, as any claim against the Managers would face a cast iron defence of change of position, since they had accounted to the Commissioners for the entirety of the tax and retained no benefit for themselves (this reasoning mistakenly presumed that the Managers were entitled to retain the notional 25, as deductible input tax, and that the notional 75 was irrecoverable by the Managers from the Commissioners). Secondly, it would not undermine or conflict with the contract between the Lead Claimants and the Managers, which had provided for the payment of VAT if applicable. Thirdly, notwithstanding the absence of a strict causal connection between the payments by the Lead Claimants and the enrichment of the Commissioners, the nexus created by the VAT system between the consumer and the Commissioners could, in his view, hardly be closer or stronger as a matter of commercial reality. In that regard, the judge referred at para 49 to the statements of the Court of Justice in Elida Gibbs Ltd v Customs and Excise Comrs (Case C 317/94) [1996] ECR I 5339; [1997] QB 499, that the basic principle of the VAT system is that it is intended to tax only the final consumer (para 19), and that the taxable persons collect the tax on behalf of the tax authorities and account for it to them (para 22). In his view, cases concerned with subrogation showed that the at the expense of requirement could be satisfied by reference to the underlying commercial reality of a transaction (para 72). By the time this case came before the Court of Appeal, the approach adopted by the judge had already been approved by that court in three decisions: Menelaou v Bank of Cyprus UK Ltd [2013] EWCA Civ 1960, [2014] 1 WLR 854; TFL Management Services Ltd v Lloyds TSB Bank plc [2013] EWCA Civ 1415, [2014] 1 WLR 2006; and Relfo Ltd v Varsani (No 2) [2014] EWCA Civ 360; [2015] BCLC 14. It was also endorsed by the Court of Appeal in the present case. The court noted that the judge had been mistaken in thinking that the Managers would have a defence to a direct claim by the Lead Claimants, so far as the notional 25 was concerned. It nevertheless agreed with his conclusion that, in the context of VAT, the final consumer who paid the tax had a sufficient economic connection with the Commissioners to be able to say that they had been enriched at his expense when the tax ought never to have been imposed on the services which were supplied. General discussion Decisions concerning the question whether an enrichment was at the expense of the claimant demonstrate uncertainty as to the approach which should be adopted. Such tests as have been suggested have been too vague to provide clarity. For example, in Menelaou v Bank of Cyprus UK Ltd [2015] UKSC 66; [2016] AC 176, Lord Clarke of Stone cum Ebony said at para 27, with the agreement of Lord Neuberger of Abbotsbury, Lord Kerr of Tonaghmore and Lord Wilson, that the question in each case is whether there is a sufficient causal connection, in the sense of a sufficient nexus or link, between the loss to the bank and the benefit received by the defendant. This leaves unanswered the critical question, namely, what connection, nexus or link is sufficient? The same can be said of Arden LJs statement in Relfo that there must be a sufficient link (para 95), Floyd LJs reference in the same case to proximity (para 110), and the Court of Appeals finding in the present case that there was a sufficient economic connection (para 67). It would be unwise to attempt in this appeal to arrive at a definitive statement of the circumstances in which the enrichment of a defendant can be said to be at the expense of the claimant. Nevertheless, in view of the uncertainty which has resulted from the use of vague and generalised language, this court has a responsibility to establish more precise criteria. Some observations of a general nature should therefore be made, before turning to the specific context in which the issue arises in the present case. It should be said at the outset that these observations are concerned only with personal claims, and not with proprietary claims. First, it is important, when dealing with personal claims based on unjust enrichment, to bear in mind what was said by Lord Goff of Chieveley in Lipkin Gorman v Karpnale Ltd [1991] 2 AC 548, 578, when rejecting a submission that, when dealing with a claim to restitution based on unjust enrichment, it was for the court to consider the question of injustice or unfairness on broad grounds, and that it should deny recovery if it thought that it would be unjust or unfair to hold the defendant liable: The recovery of money in restitution is not, as a general rule, a matter of discretion for the court. A claim to recover money at common law is made as a matter of right; and even though the underlying principle of recovery is the principle of unjust enrichment, nevertheless, where recovery is denied, it is denied on the basis of legal principle. As Lord Steyn remarked in Banque Financire, unjust enrichment ranks next to contract and tort as part of the law of obligations (p 227). A claim based on unjust enrichment does not create a judicial licence to meet the perceived requirements of fairness on a case by case basis: legal rights arising from unjust enrichment should be determined by rules of law which are ascertainable and consistently applied. Without going as far as Scrutton LJ, who described the legacy of Moses v Macferlan (1760) 2 Burr 1005 as a history of well meaning sloppiness of thought (Holt v Markham [1923] 1 KB 504, 513), McLachlin J rightly cautioned against the tendency to view the action for unjust enrichment as a device for doing whatever may seem fair between the parties: Peter v Beblow (1993) 1 SCR 980, 988. Secondly, the adoption of the concept of unjust enrichment in the modern law, as a unifying principle underlying a number of different types of claim, does not provide the courts with a tabula rasa, entitling them to disregard or distinguish all authorities pre dating Lipkin Gorman. The point is illustrated by the judgment of Floyd LJ in TFL, where the decision in Ruabon Steamship Co Ltd v London Assurance [1900] AC 6 was put to one side on the basis that the House of Lords was not looking at the case through the eyes of the modern law of unjust enrichment (para 39). Although judicial reasoning based on modern theories of unjust enrichment is in some respects relatively novel, there are centuries worth of relevant authorities, whose value should not be underestimated. The wisdom of our predecessors is a valuable resource, and the doctrine of precedent continues to apply. The courts should not be reinventing the wheel. Thirdly, as the judge observed in the present case, in remarks with which Lord Clarke expressed agreement in Menelaou (para 19), Lord Steyns four questions are no more than broad headings for ease of exposition. They are intended to ensure a structured approach to the analysis of unjust enrichment, by identifying the essential elements in broad terms. If they are not separately considered and answered, there is a risk that courts will resort to an unstructured approach driven by perceptions of fairness, with consequent uncertainty and unpredictability. At the same time, the questions are not themselves legal tests, but are signposts towards areas of inquiry involving a number of distinct legal requirements. In particular, the words at the expense of do not express a legal test; and a test cannot be derived by exegesis of those words, as if they were the words of a statute. The structured approach provided by the four questions does not, therefore, dispense with the necessity for a careful legal analysis of individual cases. In carrying out that analysis, it is important to have at the forefront of ones mind the purpose of the law of unjust enrichment. As was recognised in Menelaou (para 23), it is designed to correct normatively defective transfers of value, usually by restoring the parties to their pre transfer positions. It reflects an Aristotelian conception of justice as the restoration of a balance or equilibrium which has been disrupted. That is why restitution is usually the appropriate remedy. The nature of the various legal requirements indicated by the at the expense of question follows from that principle of corrective justice. They are designed to ensure that there has been a transfer of value, of a kind which may have been normatively defective: that is to say, defective in a way which is recognised by the law of unjust enrichment (for example, because of a failure of the basis on which the benefit was conferred). The expression transfer of value is, however, also too general to serve as a legal test. More precisely, it means in the first place that the defendant has received a benefit from the claimant. But that is not in itself enough. The reversal of unjust enrichment, usually by a restitutionary remedy, is premised on the claimants also having suffered a loss through his provision of the benefit. This was recognised in Menelaou, as was noted in para 37 above. It was explained more fully by Lord Clyde in Banque Financire, citing a maxim of Pomponius: My Lords, the basis for the appellants claim is to be found in the principle of unjust enrichment, a principle more fully expressed in the Latin formulation, nemo debet locupletari aliena jactura [no one should be enriched by anothers loss] . Without attempting any comprehensive analysis, it seems to me that the principle requires at least that the plaintiff should have sustained a loss through the provision of something for the benefit of some other person with no intention of making a gift, that the defendant should have received some form of enrichment, and that the enrichment has come about because of the loss. (p 237) It should be emphasised that there need not be a loss in the same sense as in the law of damages: restitution is not a compensatory remedy. For that reason, some commentators have preferred to use different terms, referring for example to a subtraction from, or diminution in, the claimants wealth, or simply to a transfer of value. But the word loss is used in the authorities, and it is perfectly apposite, provided it is understood that it does not bear the same meaning as in the law of damages. The loss to the claimant may, for example, be incurred through the gratuitous provision of services which could otherwise have been provided for reward, where there was no intention of donation. In such a situation, the claimant has given up something of economic value through the provision of the benefit, and has in that sense incurred a loss. Direct and indirect provision of a benefit Situations in which the defendant has received a benefit from the claimant, and the claimant has incurred a loss through the provision of that benefit, usually arise where the parties have dealt directly with one another, or with one anothers property. Common examples are the gratuitous payment of money, or provision of goods or services, by the claimant to the defendant, where there was no intention of donation. In such a situation, if the enrichment of the defendant is unjust if, in other words, the transfer of value is defective in a sense recognised by the law of unjust enrichment then the claimant is prima facie entitled to have the enrichment reversed. There are, however, situations in which the parties have not dealt directly with one another, or with one anothers property, but in which the defendant has nevertheless received a benefit from the claimant, and the claimant has incurred a loss through the provision of that benefit. These are generally situations in which the difference from the direct provision of a benefit by the claimant to the defendant is more apparent than real. One such situation is where the agent of one of the parties is interposed between them. In that situation, the agent is the proxy of his principal, by virtue of the law of agency. The series of transactions between the claimant and the agent, and between the agent and the defendant, is therefore legally equivalent to a transaction directly between the claimant and the defendant. Similarly, where the right to restitution is assigned, as in Equuscorp Pty Ltd v Haxton [2012] HCA 7; 246 CLR 498; 86 AJLR 296, the claimant stands in the shoes of the assignor, and is therefore treated as if he had been a party to the relevant transaction, and the defendants enrichment had been directly at his expense. Another situation is where, as in Relfo, an intervening transaction is found to be a sham (para 121). Since the sham is created precisely in order to conceal the connection between the claimant and the defendant, it is disregarded when deciding whether the latter was enriched at the formers expense. So, in Relfo, Gloster and Floyd LJJ described the arrangements in question as being equivalent to a direct payment (paras 103 and 115). There have also been cases, discussed below, in which a set of co ordinated transactions has been treated as forming a single scheme or transaction for the purpose of the at the expense of inquiry, on the basis that to consider each individual transaction separately would be unrealistic. There are also situations where the defendant receives property from a third party into which the claimant can trace an interest. Since the property is, in law, the equivalent of the claimants property, the defendant is therefore treated as if he had received the claimants property. A different type of situation is typified by the case where the claimant discharges a debt owed by the defendant to a third party. Although it is the third party creditor who receives the payment from the claimant, the defendant is directly enriched, since the payment discharges his debt: the enrichment is not the payment which the third party receives, but the discharge which the defendant receives. Where the transfer of value is defective, and the enrichment is consequently unjust, the law reverses it, as far as possible, by subrogating the claimant to the rights formerly held by the third party (as was explained, for example, by Walton J in Burston Finance Ltd v Speirway Ltd [1974] 1 WLR 1648, 1652). There are many variations on the type of situation where equitable subrogation is an appropriate remedy to reverse or prevent unjust enrichment. The remedy differs from restitution, in that it does not have the effect of restoring the parties to their pre transfer positions, but it is the most practicable means of reversing or preventing unjust enrichment in the types of situation where it is appropriate. It has often been suggested that there is a general rule, possibly subject to exceptions, that the claimant must have directly provided a benefit to the defendant. The situations discussed in the two preceding paragraphs can be reconciled with such a rule, if it is understood as encompassing a number of situations which, for the purposes of the rule, the law treats as equivalent to a direct transfer, in the sense that there is no substantive or real difference. So understood, the suggested rule is helpful. It may nevertheless require refinement to accommodate other apparent exceptions, and it would be unwise at this stage of the laws development to exclude the possibility of genuine exceptions, or to rule out other possible approaches. Where, on the other hand, the defendant has not received a benefit directly from the claimant, no question of agency arises, and the benefit does not consist of property in which the claimant has or can trace an interest, it is generally difficult to maintain that the defendant has been enriched at the claimants expense. The point is illustrated by the case of MacDonald Dickens & Macklin v Costello [2011] EWCA Civ 930; [2012] QB 244, where the provision of services to a company was held not to enrich its directors and shareholders. It is also illustrated by the example, discussed in Relfo, of a claimant who makes a mistaken payment to a third party, who in consequence makes a gift to the defendant out of property in which the claimant has no interest, and into which he is unable to trace. As Arden and Floyd LJJ recognised (paras 78 and 114), the claimant does not have a claim in unjust enrichment against the defendant. The claimant suffers a loss through making the payment to the third party, who is unjustly enriched at his expense. A claim in unjust enrichment therefore lies against the third party (subject to any defences available). But no claim of a personal nature lies at the instance of the claimant against the defendant: the claimant has not incurred any loss through the making of the gift. Incidental benefits As explained earlier, the at the expense of requirement is not satisfied merely by the direct receipt of a benefit. The claimant must also incur a loss through the provision of the benefit. As Lord Clyde put it in Banque Financire, in the passage cited at para 44 above, the plaintiff should have sustained a loss through the provision of something for the benefit of some other person. That requirement will not normally be satisfied where the provision of the benefit was merely an incidental or collateral result of his expenditure. (In practice, situations where the defendant has received a benefit merely as an incidental consequence of the claimants pursuit of some other objective are also often situations in which the enrichment of the defendant is not in any event unjust.) In such a situation, the claimant may have received the consideration for which he bargained as the counterpart of his own expenditure, and in that event will not usually have suffered any loss. Even if he has incurred a loss, it will not normally have arisen through his provision of something for the benefit of the defendant, since the benefit received by the defendant will have been merely incidental or collateral to the reason why the expenditure was incurred. A but for causal connection between the claimants being worse off and the defendants being better off is not, therefore, sufficient in itself to constitute a transfer of value. The need for the claimant to suffer a loss through the provision of something for the benefit of the defendant is illustrated by the Ruabon case, which concerned a ship which had been damaged during a voyage covered by a policy of marine insurance. She was put into dry dock for repairs at the expense of the insurers. The owners took advantage of her being in dry dock to have her surveyed for the purpose of renewing her Lloyds classification. There was no consequent increase in dock expenses. Even if the insurers might be regarded as having provided a benefit to the owners (by enabling them to have the vessel surveyed without themselves incurring the expense of putting her into dry dock), the insurers incurred no loss through the provision of that benefit: their expenses were not increased, and they received the consideration for which they had paid. The insurers claim for a contribution towards their expenses, on the basis that the owners had benefited from it, was rejected. Lord Macnaghten put the point in a nutshell: there is no principle of law which requires that a person should contribute to an outlay merely because he has derived a material benefit from it (p 15). The Earl of Halsbury LC, in a speech with which the other members of the Committee agreed, emphasised the fact that the owners were strangers to the exercise undertaken by the insurers, and the absence in those circumstances of any reason why, in justice, they should contribute towards its cost: [T]his is the first time in which it has been sought to advance that principle [of contribution] where there is nothing in common between the two persons, except that one person has taken advantage of something that another person has done, there being no contract between them, there being no obligation by which each of them is bound, and the duty to contribute is alleged to arise only on some general principle of justice, that a man ought not to get an advantage unless he pays for it. So that if a man were to cut down a wood which obscured his neighbour's prospect and gave him a better view, he ought upon this principle to be compelled to contribute to cutting down the wood. (p 12) The Lord Chancellors example did not involve anything which might have been argued to be an unjust factor, but the position would scarcely be different if it had: if, for example, the man had cut down the wood in the mistaken belief that the trees were diseased. Another illustration of the need for a loss to be incurred through the provision of the benefit, also cited to the Court of Appeal in the TFL case, is the case of Edinburgh and District Tramways Co Ltd v Courtenay 1909 SC 99. It concerned a contract between a tramway company and an advertising firm, under which the firm paid a rental for the right to display advertising on the tramcars. It was up to the firm to provide the boards around the upper deck of the tramcars, on which the advertisements were displayed. The tramway company subsequently constructed new tramcars with decency boards already supplied, saving the advertising firm the expense of fitting its own. The tramway companys claim against the advertising firm for the cost of fitting the decency boards was rejected, on the ground that the tramway company had not incurred any loss through the provision of the benefit. Lord President Dunedin observed that there are certain marks or notes of the situation in which recompense is due, and I think that one mark or note is that the person who claims recompense must have lost something (pp 105 106). The Lord President also emphasised that the company had been acting for its own purposes. Referring to earlier authorities, he remarked that in the case at hand you have the same element that went to the decision of some of these eases, that the thing done was as much for the benefit of the man who did it as for that of the other person (p 106). The Lord President illustrated his opinion with an illuminating example: One man heats his house, and his neighbour gets a great deal of benefit. It is absurd to suppose that the person who has heated his house can go to his neighbour and say Give me so much for my coal bill, because you have been warmed by what I have done, and I did not intend to give you a present of it. (p 105) The importance of identifying a loss arising through the provision of a benefit is also illustrated by the case of TFL, where a claim based on unjust enrichment was brought by a company, A, against a defendant, B, in order to recover the costs which A had incurred in earlier legal proceedings. Those proceedings had been brought by A in order to recover a debt from a third party, C, and had been successfully defended on the ground that the debt was due, not to A, but to B. After B recovered the debt, A brought proceedings against B on the basis that A had conferred a benefit on it by bringing the earlier proceedings and thereby clarifying Bs right to recover the debt. Since A had done so under an erroneous understanding of its rights, it argued that B had therefore been unjustly enriched at its expense. The Court of Appeal, by a majority (Sir Stanley Burnton dissenting), held that the claim could not be summarily dismissed. The court had understandable difficulty in identifying the benefit which had supposedly been conferred by A on B (para 50), and accepted that the benefit, whatever it consists of, had not been directly provided by A to B (para 54). It appears to have considered that a causal link between As payment of the costs of the proceedings and an indirect benefit to B was nevertheless arguably sufficient (para 64). The fact that A had been acting in its own interests was considered to be no answer (para 67). The court could hardly have reached the same conclusion if, when considering the at the expense of question, it had focused on the need to identify a transfer of value from the claimant to the defendant. A had not provided any benefit directly to B. At best, B had received an incidental benefit as the result of As pursuit of its own interests. The facts of the case, so far as the at the expense of question is concerned, were not materially distinguishable from those of Lord Dunedins example of the householder whose heating warms his neighbours house. Furthermore, As erroneous understanding of its legal rights did not in any event bear on the justice of Bs incidentally benefiting from the clarification of the legal position: one might cite Pollock CBs rhetorical question in Taylor v Laird (1856) 25 LJ Ex 329, 332, One cleans anothers shoes; what can the other do but put them on? A had received the legal services it had bargained for when it incurred the expense (and, if it also had to meet its opponents costs, that was a risk inherent in litigation, which it voluntarily assumed). Even bearing in mind that the Court of Appeal was dealing with a strike out application, the majority of the court were wrong in not summarily dismissing the claim. It is interesting to note that similar claims were rejected long ago in Scotland, on the basis that the litigant had been pursuing his own interests. More, in his Notes to Stairs Institutions (1832), states: a person who, for his own benefit, carries on an expensive law suit, which, in the result, establishes some point as beneficial to other neighbouring proprietors as to himself, can make no claim against them for any part of the expense incurred by him. And Lord Stair, in the text, states the case of a person who reduces [sets aside] a right as void, and thereby lets in the claims of third parties, which are ultimately preferred to his own, yet he says, that as he was doing his own business, not theirs, he can claim no share from them of his expenses. (p liv) Humes Lectures (1786 1822) are to the same effect, stating in relation to the person who brings an action: Now, though it should so happen, (as very often it must,) that he settles some point of law, in the decision of this lawsuit of his, and thus does a service to a number of other persons, whose property, or concerns, are in the like situation; yet still the cost of this lawsuit is his peculiar and exclusive concern. He can recover no part of it from his neighbours, or any of them, for whose benefit he probably never would have stirred in the matter. (Vol III, p 167, citing the unreported case of Ferguson v Smyth, 18 November 1802, SC Old Sess Pap, vol 437, No 30.) Economic reality Nor is the at the expense of requirement satisfied by a connection between the parties respective benefit and loss merely as a matter of economic or commercial reality. Economic reality is not only a somewhat fuzzy concept, as Moses LJ described it in Menelaou [2014] 1 WLR 854, para 62, but one which is difficult to apply with any rigour or certainty in this context, or consistently with the purpose of restitution on the ground of unjust enrichment. An inquiry into where the economic burden of an unjust enrichment has fallen is liable to be a very complex undertaking, especially where there is a chain of suppliers and consumers. The supplier who passes on a tax or other charge by increasing the price of his goods or services might be thought to have shifted the economic burden, but his increased prices may have an adverse impact upon his sales, and accordingly upon the profitability of his operations. Furthermore, in a situation where numerous factors affect the prices which he charges, it may be far from easy to decide to what extent the economic burden of the tax has been reflected in the price charged. Deciding whether the economic burden of an unjust enrichment has been passed on has been described as virtually unascertainable (Hanover Shoe Inc v United Shoe Machinery Corpn (1968) 392 US 481, 493) and a near impossibility (British Columbia v Canadian Forest Products Ltd [2004] 2 SCR 74, para 205). These points have been made repeatedly in other jurisdictions, when considering a defence of passing on: that is to say, a defence based on the proposition that the economic burden of an unjustified enrichment was borne not by the claimant but by a third party: see, for example, Commissioner of State Revenue (Victoria) v Royal Insurance Australia Ltd (1994) 182 CLR 51; 126 ALR 1; Kingstreet Investments Ltd v New Brunswick (Finance) Ltd [2007] 1 SCR 3; and the Opinions of Advocate General Mancini in Amministrazione delle Finanze dello Stato v SpA San Giorgio (Case 199/82) [1983] ECR 3595 (San Giorgio) and of Advocate General Geelhoed in Commission of the European Communities v Italian Republic (Case C 129/00) [2003] ECR I 14637. A more fundamental difficulty with an approach based on economic reality arises from the fact that the purpose of restitution is not to compensate for loss, but to reverse the defective transfer. Looking to see who has suffered an economic loss is therefore not, in principle, the correct way of identifying the appropriate claimant. Indeed, even in tort law, which is concerned with compensation for loss, the court is not concerned with where the economic burden of the tort may ultimately have fallen as a matter of economic reality. Co ordinated transactions There are, on the other hand, cases in which the court has referred to reality in a different sense. These are cases in which, for the purpose of answering the at the expense of question, the court has treated a set of related transactions, operating in a co ordinated way, as forming a single scheme or transaction, on the basis that to answer the question by considering each of the individual transactions separately would be unrealistic. The case of Banque Financire, as explained in some of the judgments, is an example. The claimant had entered into a refinancing arrangement involving the loan of a sum of money to the manager of a holding company, which he in turn lent to a subsidiary of that company so that it could discharge a debt secured by a first ranking security. The purpose of interposing the manager between the claimant and the first subsidiary was to avoid a requirement to make a public disclosure of the loan, which would have applied if the claimant had lent the money directly to the first subsidiary. The claimant paid the money directly to the subsidiarys creditor, so discharging the debt. It was conceded that this enriched the defendant, which was another subsidiary of the holding company, since it promoted the ranking of its own security, with the consequence that it was the only creditor of the first subsidiary which was likely to be repaid. This was contrary to the understanding on which the claimant had advanced the loan, namely that it would be repaid in priority to all intra group debts. The House of Lords held that this would unjustly enrich the defendant, and therefore subrogated the claimant to the discharged security, as against the defendant, so as to prevent the unjust enrichment. One of the questions considered by the House of Lords was whether the enrichment was at the expense of the claimant, when the claimant had made the loan to the manager of the holding company, who had then made a further loan to the first subsidiary, rather than the claimant lending directly to the first subsidiary. Two different analyses were put forward. Lord Steyn proceeded on the basis that the interposition of the loan to the manager was no more than a formal act designed to allow the transaction to proceed . To allow [it] to alter the substance of the transaction would be pure formalism (p 227). Lord Clyde similarly stated that the arrangement with the manager did not prevent recognition of the reality of the granting of the funds by [the claimant] to [the holder of the first ranking security] (p 238). That was also the view of Lord Hutton (the reality was that the [defendant] was enriched at the expense of [the claimant]: p 239). Lord Hoffmann, with whom Lord Steyn, Lord Griffiths and Lord Clyde agreed, put forward another analysis, namely that the claimants money could be traced into the discharge of the debt secured by the first ranking security (p 235). On both analyses, the House of Lords treated the situation as one where the defendant had directly received a benefit from the claimant, since on one analysis it was in reality the claimant which had discharged the first ranking security and thereby promoted the defendants security, and on the other analysis it was the claimants money which had done so. The case of Menelaou provides another illustration. The case concerned the sale of a property owned by the defendants parents, and the use of part of the proceeds to purchase another property in her name, as a gift. The claimant bank held a charge over the first property to secure the parents borrowings, and agreed to the discharge of the security in return for a fresh charge over the second property. It instructed solicitors to deal with the discharge of the security over the first property and to obtain a charge over the second property. The solicitors sent the bank a charge over the second property, purportedly executed by the defendant, and the bank authorised the discharge of the security over the first property. In the event, the second charge was defective, as a result of the solicitors negligence. The defendant had agreed to the purchase of the second property in her name, but was unaware of her parents agreement with the bank that there should be a charge. The solicitors admitted liability to the bank for its losses, subject to credit being given for any sums which the bank might recover from the defendant. Lord Carnwath analysed the case in terms of the law of equity rather than unjust enrichment. He considered that the moneys held by the solicitors following the sale of the first property, and used to purchase the second property, were held on a Quistclose type trust for the bank (Quistclose Investments Ltd v Rolls Razor Ltd [1970] AC 567). On that footing, it followed that the bank was subrogated to the lien of the unpaid vendor of the second property, so as to give it an equitable interest in the property. In other words, the vendor had a lien over the property, to secure his right to payment of the purchase price, as long as he remained unpaid. The bank, on discharging the parents obligation to pay the vendor, became entitled in equity to the benefit of that lien (or, strictly analysed, to a new lien to secure its own right to repayment) by subrogation. The other members of the court held that the bank should be subrogated to the unpaid vendors lien on the basis of unjust enrichment, since it had mistakenly authorised the use of the proceeds of sale of the first property (which it could otherwise have required to be applied to discharge the debt owed to itself) to purchase the second property, thereby providing the defendant with a benefit at its expense. Lord Clarke proceeded on the basis that the two arrangements, namely the sale of [the first property] and the purchase of [the second property], were not separate but part of one scheme, which involved the bank throughout (para 25). Lord Neuberger agreed, observing that it is appropriate not merely to consider the purchase of, and charge over, [the second property] as a single composite transaction, applying the approach to property purchases involving a charge which was adopted in Abbey National Building Society v Cann [1991] 1 AC 56, but that it was also appropriate in the present case to treat the sale of [the first property] and the purchase of [the second property] as one scheme, at least for present purposes (para 67). Lord Kerr and Lord Wilson agreed with both judgments in relation to this issue. On that basis, Lord Clarke considered that the conclusion that there had been a transfer of value between the bank and the defendant gave effect to the reality of the transaction, notwithstanding the absence of a direct payment by the former to the latter (para 33). Lord Neuberger agreed, stating: [T]here was in reality a single transaction, and it was from that transaction that [the defendant] directly benefitted, even though the benefit was effected at the direction of the Menelaou parents. The benefit to [the defendant] was direct because it arose as the immediate and inevitable result of the very transaction to which she was party and which gave rise to the unjust enrichment. (para 73) At the expense of in the present case Turning to the issue raised in the present case, the only English authority cited in argument which contains a discussion of the at the expense of question in relation to taxation is the decision of the Court of Appeal in Kleinwort Benson Ltd v Birmingham City Council [1997] QB 380. The case concerned a claim by a bank for restitution of money which it had paid to a local authority under a void swap transaction. The bank had also entered into hedging arrangements with a third party which protected it against loss. In considering whether English law recognised a defence of passing on, the Court of Appeal discussed the requirement that the defendants enrichment should be at the expense of the claimant. Evans LJ, delivering the leading judgment with which Saville LJ agreed, referred to a range of authority and academic writing from other jurisdictions, including two authorities concerned with taxes paid under a mistake: the decision of the United States Federal Court of Appeals for the Second Circuit in 123 East Fifty Fourth Street Inc v United States (1946) 157 F 2d 68, and the decision of the High Court of Australia in Commissioner of State Revenue (Victoria) v Royal Insurance Australia Ltd. He noted that the cases raised a question, akin to agency, which is whether the taxpayer should be regarded as having collected tax from his customers on behalf of the taxing authority, and that it had been said by Learned Hand J in the 123 East Fifty Fourth Street case that any tax recovered by the taxpayer would be held by him as a fiduciary for his customers. Similarly, in the Royal Insurance case it had been said that if it was established that the plaintiff had charged its policy holders the tax as a separate item, it would be entitled to recover the money from the tax authority but would then hold it as a constructive trustee. In the event, however, Evans LJ found the taxation cases of little assistance, since on the facts of the case no question of a constructive trust or of any obligation to account to customers could arise (p 391). Morritt LJ, with whose judgment Saville LJ also agreed, emphasised that the plaintiff was legally and beneficially entitled to the money it paid to the authority, and that the case was not one in which the claimant held the money claimed as a bare trustee or tax collector such as, arguably, in the 123 East Fifty Fourth Street case (p 400). It has not been argued in the present appeal that the Managers held the amounts paid to them by the Lead Claimants in respect of VAT as agents or trustees or in any other fiduciary capacity. In the circumstances, it is unnecessary to consider the American and Australian authorities in any detail. The dissenting opinion of Learned Hand J in the 123 East Fifty Fourth Street case was concerned with a simpler situation than the present case, where the supplier of services collected sales tax from his customers, as a separately identifiable amount paid for the purpose of meeting the tax, and then remitted the whole of that amount to the tax authority. The same was true in the case of Wayne County Produce Co v Duffy Mott Co (1927) 244 NY 351, where Cardozo CJ adopted a similar approach. The reasoning in these cases was approved by Mason CJ in the Royal Insurance case, in an opinion in which the other members of the court did not join, but he distinguished the case before him on the basis that the amount collected was not paid separately from the price of the services supplied. In considering these authorities, it is necessary not only to bear in mind the differences from the facts of the present case, but also to remember that American and Australian law adopt a broader approach to constructive trusts than English law. In particular, one of the essential requisites for a trust in English law is that there must be identifiable trust property (or its traceable proceeds) in the hands of the recipient which is not available to him as part of his general assets: see Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669, 705. In the present case, the contracts between the Managers and the Lead Claimants provided for the Managers to be paid fees plus VAT if applicable (or words to similar effect). The contractual obligation of the Lead Claimants was therefore to pay the fees plus whatever sum, if any, was necessary in order to meet the VAT chargeable on the supply in question. This was reflected in the invoices issued by the Managers, which drew a distinction between their fees, on the one hand, and the VAT due on their fees, on the other hand. There is, however, no evidence that the Managers were expected to keep the amounts paid to them by the Lead Claimants in respect of VAT separate from their other funds: on the face of things, they were entitled to treat them as part of their general assets. It follows that in paying those amounts to the Managers, the Lead Claimants must be taken to have intended to part with any interest in the money, rather than to have impressed it with a special purpose trust. Furthermore, since the Managers were not aware of any mistake prior to making payment to the Commissioners, their conscience cannot have been affected so as to render them trustees: see Westdeutsche at p 709. In these circumstances, the right to the restitution of money paid under the contract as the result of a mistake gives rise, like the contract itself, to purely personal obligations. Returning, then, to the question whether the unjust enrichment of the Commissioners was at the expense of the Lead Claimants, and focusing on whether there was a transfer of value from the Lead Claimants to the Commissioners, the answer is in the negative. There was a transfer of value, comprising the notional 100, from the Lead Claimants to the Managers, under the contract between them. It was defective, because it was made in performance of a contractual obligation which was mistakenly believed to be owed. There was a subsequent transfer of value, comprising the notional 75, from the Managers to the Commissioners. It was also defective, because it was made in compliance with a statutory obligation which was inapplicable because it was incompatible with EU law. These two transfers cannot be collapsed into a single transfer of value from the Lead Claimants to the Commissioners. That follows from a number of considerations. First, the Lead Claimants do not challenge the judges rejection of a connection between the payments made by the Lead Claimants and the payments received by the Commissioners based on agency. The intervention of the Managers cannot therefore be disregarded on the basis that they were in law the proxy of one of the other parties. Secondly, since the payments made by the Lead Claimants formed part of the Managers general assets, to do with as they pleased, it is impossible to trace those payments into the payments subsequently made by the Managers to the Commissioners, and so to regard the Commissioners as having benefited from the receipt of property in which the Lead Claimants had an interest. Thirdly, the fact that there were two separate transactions first, between the Claimants and the Managers, and secondly between the Managers and the Commissioners is not in this context something which can be disregarded. In particular, there is no question of the transactions being a sham or involving an artificial step, or of their comprising a single scheme. The first transfer did not even bring about the second transfer as a matter of causation: the judges rejection of a but for causal connection between the two transfers is not challenged. The Lead Claimants rely on a connection established by commercial or economic reality. But, for the reasons already explained, the fact that, as a matter of economic or commercial reality, the Lead Claimants bore the cost of the undue tax paid by the Managers to the Commissioners does not in itself entitle them to restitution from the Commissioners. It follows that the Lead Claimants did not in principle have any right to restitution against the Commissioners. They did, on the other hand, have a right to restitution against the Managers. That right was to restitution of the entire amount paid in respect of VAT, ie the notional 100. The Managers did not in principle have a change of position defence in respect of the notional 75 which they paid to the Commissioners, since that change of position was reversible under section 80 of the 1994 Act, as I shall shortly explain. Nor did they have a change of position defence in respect of the notional 25 which they retained. Steyns questions. Section 80 of the 1994 Act In order to determine the issues arising in relation to EU law, it is necessary next to consider the effect of section 80 of the 1994 Act. The section has undergone amendment on a number of occasions. The version in force at the time when the Managers made their claims, and also applicable at the time when the present actions were brought by the Lead Claimants, was in the following terms, so far as material: In the circumstances, it is unnecessary to consider the remainder of Lord Credit for, or repayment of, overstated or overpaid VAT (1) Where a person (a) has accounted to the Commissioners for VAT for a prescribed accounting period (whenever ended), and (b) in doing so, has brought into account as output tax an amount that was not output tax due, the Commissioners shall be liable to credit the person with that amount. (lA) Where the Commissioners (a) have assessed a person to VAT for a prescribed accounting period (whenever ended), and (b) tax an amount that was not output tax due, in doing so, have brought into account as output they shall be liable to credit the person with that amount. (lB) Where a person has for a prescribed accounting period (whenever ended) paid to the Commissioners an amount by way of VAT that was not VAT due to them, otherwise than as a result of (a) brought into account as output tax, or (b) 26 not being brought into account, an amount of input tax allowable under section an amount that was not output tax due being the Commissioners shall be liable to repay to that person the amount so paid. (2) The Commissioners shall only be liable to credit or repay an amount under this section on a claim being made for the purpose. (2A) Where (a) as a result of a claim under this section by virtue of subsection (1) or (lA) above an amount falls to be credited to a person, and after setting any sums against it under or by (b) virtue of this Act, some or all of that amount remains to his credit, the Commissioners shall be liable to pay (or repay) to him so much of that amount as so remains. (3) It shall be a defence, in relation to a claim under this section by virtue of subsection (1) or (lA) above, that the crediting of an amount would unjustly enrich the claimant. (4) The Commissioners shall not be liable on a claim under this section (a) (1) or (1A) above, or (b) (1B) above, to repay an amount to a person under subsection to credit an amount to a person under subsection if the claim is made more than three years after the relevant date [ie the end of the prescribed accounting period]. (7) Except as provided by this section, the Commissioners shall not be liable to credit or repay any amount accounted for or paid to them by way of VAT that was not VAT due to them. Section 80 is supplemented by section 80A, introduced by section 46(2) of the Finance Act 1997 and subsequently amended, which enables the Commissioners to make regulations providing for reimbursement arrangements to be disregarded for the purposes of section 80(3) except where they contain such provision, and are supported by such undertakings, as may be required by the regulations. The relevant regulations are contained in Part VA of the Value Added Tax Regulations 1995 (SI 1995/2518), as amended. They provide for reimbursement arrangements, defined by regulation 43A as arrangements for the purposes of a claim under section 80 which (a) are made by a claimant for the purpose of securing that he is not unjustly enriched by the crediting of any amount in pursuance of the claim, and (b) provide for the reimbursement of persons (consumers) who have, for practical purposes, borne the whole or any part of the original amount brought into account as output tax that was not output tax due. The regulations go on to require the claimant under section 80 to give undertakings to the Commissioners that he will apply the whole of the amount credited, and any interest on that amount, to the reimbursement of identified consumers whom he has reimbursed or intends to reimburse. It is common ground that, for persons who have accounted to the Commissioners for VAT that was not due, section 80 and the associated regulations provide a code for the recovery of VAT which is exhaustive and excludes other remedies such as a common law claim based on unjust enrichment. It is also common ground that the ITCs could never have made a claim under section 80, since they did not pay or account for any of the VAT in question to the Commissioners. The first issue in dispute is whether the effect of section 80 is to exclude a common law claim by the ITCs, assuming, contrary to my earlier conclusion, that such a claim might otherwise be brought. The argument for the Lead Claimants is based primarily on the structure and wording of section 80. They point out that subsections (1) to (6) are concerned with the crediting or repayment of undue VAT to the supplier, not the consumer. In subsection (7), the words credit or repay echo the language of earlier subsections, where they can plainly refer only to the repayment or crediting of the supplier. They submit that subsection (7) is similarly concerned with the supplier. Only a supplier of goods or services can account for an amount to the Commissioners, and only a supplier can be credited with an amount by them. Similarly, only a supplier can be repaid by the Commissioners, since only he has paid them in the first place. Section 80(7) is thus designed only to exclude claims, otherwise than under the section, by persons who have a claim under the section. That argument was accepted by the Court of Appeal. On behalf of the Commissioners, it is argued that the word repay is capable of applying to any payment back by the Commissioners of VAT which they have received. From their perspective, there is a repayment if the VAT is refunded, whether to the supplier or to someone else. Furthermore, it is argued, it would be strange if section 80(7) barred a restitutionary claim by the supplier, but left the suppliers customer in a better position. Moreover, it is argued, section 80 establishes a statutory scheme for the restitution of VAT which was not due, which by necessary implication excludes non statutory restitutionary claims. The argument seeks to draw support from the decision of the Court of Appeal in Monro v Revenue and Customs Comrs [2008] EWCA Civ 306; [2009] Ch 69, where a common law claim was held to be excluded by a statutory scheme for the recovery of tax, since it would be inconsistent with the purpose of the scheme. In agreement with the judge, I find the textual arguments inconclusive, when considered by themselves. The word repay is capable of bearing a wider meaning than the one for which the claimants contend, but could also be construed more narrowly. A purposive construction of the provision points more clearly to the correct conclusion. In that regard, section 80(3) and (4) are particularly important. Under section 80(3), the Commissioners have a statutory defence to a claim under section 80 a claim which, it is agreed, can only be made by a supplier where crediting the supplier would unjustly enrich him. The possibility of unjust enrichment (in a non technical sense) arises because the supplier normally recovers from his customers the output tax for which he accounts to the Commissioners. The subsection therefore creates a statutory defence of passing on. Section 80A, and the 1995 Regulations, then create a scheme under which the defence is disapplied where reimbursement arrangements are made with the purpose of ensuring that the payment to the supplier is used to reimburse the consumers who have borne the economic burden of the tax. Sections 80 and 80A, together with the 1995 Regulations, thus create a scheme which enables consumers who have been wrongly charged VAT to obtain reimbursement. The consumers are able to recover the VAT which they were wrongly charged, to the extent that it was remitted by the supplier to the Commissioners, through the medium of the suppliers claim under section 80. Although the consumers remedy is indirect, it can generally be expected to be effective: if the supplier is otherwise reluctant to make a claim, the consumers have a direct claim against him, as explained below. Subject to the question of time bar, these arrangements therefore remove any need there might otherwise be, in most circumstances, for the consumer to have a direct remedy against the Commissioners. It will be necessary at a later point to return to the question whether there may nevertheless be some circumstances in which a direct remedy is required by EU law. Section 80(4) lays down a limitation period for claims under the section which is shorter than the period of six years, with extensions in the event of mistake, which would apply to a common law claim in unjust enrichment under section 32(1)(c) of the Limitation Act 1980 (and which also applied under section 80(4) until its amendment by the Finance Act 1997). A statutory claim by the supplier must therefore be brought within a shorter and more certain period of time. The evident aim is to protect public finances against the risk of a liability to repay tax emerging more than three years after the tax was received. It would be inconsistent with that intention for there to be a potentially far longer period within which non statutory claims might be brought against the Commissioners by the suppliers customers. In the light, therefore, of section 80(3) and (4) in particular, Parliament cannot sensibly be taken to have intended, when it created this scheme for the reimbursement of suppliers (with provision for them in turn to reimburse their customers), subject to strict time limits, that it should exist concurrently with non statutory liabilities towards suppliers and their customers which were potentially wider in scope and were subject to a longer and less certain limitation period. Such an intention would be inconsistent with the rationale of the statutory scheme. In these circumstances, on the hypothesis that non statutory claims by consumers might otherwise lie against the Commissioners in circumstances falling within the scope of section 80, subsection (7) must be construed as excluding such claims. The Court of Appeal considered that that approach, which the judge accepted, presupposed that Parliament had in mind that restitutionary claims might be brought by consumers, and legislated with the intention of excluding such claims. As they pointed out, however, Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349, which established that money paid under a mistake of law might be recoverable, had not been decided when the 1994 Act was enacted. In their view, that background pointed away from a legislative intent to restrict claims for the recovery of overpaid VAT to the machinery provided by section 80. I find this reasoning unpersuasive. The fact that Parliament will not have had in mind a particular common law right to payment when enacting a legislative scheme for recovery does not preclude the common law right being excluded by that scheme: R (Child Poverty Action Group) v Secretary of State for Work and Pensions [2010] UKSC 54; [2011] 2 AC 15. The absence of a recognised right to recover money paid under a mistake of law, at the time when section 80 was enacted, did not exclude the possibility of restitutionary claims by consumers, since there were other established grounds on which restitution might be sought, including payment under a mistake of fact. Moreover, the Lead Claimants argument proves too much: if section 80(7) was not intended to exclude common law claims based on mistake of law, because no such cause of action was recognised when the legislation was enacted, then a common law claim by the Managers would not be excluded either; but it is common ground that section 80(7) is effective to exclude any common law claim by the Managers. More fundamentally, the determining factor in the present case is that the scheme created by section 80 is inconsistent with the existence of a concurrent non statutory liability on the part of the Commissioners to make restitution to consumers. In the absence of section 80(7), one would therefore conclude that section 80 impliedly excluded such liability (assuming that it might otherwise exist). Given the existence of an express exclusion in section 80(7) which is capable of covering such liability, it is unnecessary to rely on implication: one can construe section 80(7) as having the same exclusionary effect. It follows that section 80 bars claims by the consumers who ultimately bear the burden of VAT. It nevertheless enables them to be reimbursed, subject to a limitation period designed to avoid the disruption of public finances. Compatibility with EU law Section 80 must have been intended to be compliant with EU law, since it is concerned with the recovery of VAT, which is a tax imposed by EU law. Indeed, a report by the Law Commission indicates that section 80 was framed to accord closely with European Community law: Restitution: Mistakes of Law and Ultra Vires Public Authority Receipts and Payments, Law Com No 227 (1994) para 14.19. The present case raises the question whether the system of reimbursement established by section 80 has achieved that objective. There is a well established principle of EU law that a member state is in principle required to repay taxes levied in breach of EU law, and an equally well established exception whereby repayment can be refused where it would entail unjust enrichment of the taxable person because the burden of the tax has been passed on: see San Giorgio, paras 12 13. In the latter situation, however, the Court of Justice has held that the person to whom the tax was passed on should have a right to recover the sums unduly paid, so as to offset the consequences of the taxs incompatibility with EU law by neutralising the economic burden which the tax has imposed on the operator who has actually borne it: Danfoss A/S v Skatteministeriet (Case C 94/10) [2011] ECR I 9963, paras 23 and 25. It is for the domestic legal system of each member state to lay down the conditions under which claims may be made, subject to observance of the principles of equivalence and effectiveness: Danfoss, para 24. These general principles apply to the reimbursement of improperly invoiced VAT: Reemtsa Cigarettenfabriken GmbH v Ministero delle Finanze (Case C 35/05) [2007] ECR I 2425. Reasonable limitation periods are compatible with the principle of effectiveness, and the limitation period applicable to claims under section 80 of the 1994 Act has specifically been held to be reasonable: Marks & Spencer plc v Customs and Excise Comrs (Case C 62/00) [2003] QB 866, para 35. The court has accepted that, in principle, a system under which only the supplier is entitled to seek reimbursement of VAT from the tax authorities, and the consumer can seek restitution from the supplier, meets the requirements of EU law: Reemtsma, para 39. The court added one caveat: [I]f reimbursement of the VAT becomes impossible or excessively difficult, in particular in the case of the insolvency of the supplier, those principles may require that the recipient of the services to be able to address his application for reimbursement to the tax authorities directly. (Reemtsma, para 41). This approach has been applied and restated in later cases. In the Danfoss case, the Court of Justice put the matter in this way: 27. It follows that a member state may, in principle, oppose a claim for the reimbursement of a duty unduly paid made by the final consumer to whom that duty has been passed on, on the ground that it is not that consumer who has paid the duty to the tax authorities, provided that the consumer who, in the final analysis, bears the burden of that duty is able, on the basis of national law, to bring a civil action against the taxable person for recovery of the sums unduly paid. 28. However, if reimbursement by the taxable person were to prove impossible or excessively difficult in particular, in the case of the insolvency of that person the principle of effectiveness requires that the purchaser be able to bring his claim for reimbursement against the tax authorities directly and that, to that end, the member state must provide the necessary instruments and detailed procedural rules. In these passages, the insolvency of the taxable person is given as an example of circumstances where reimbursement by that person might prove impossible or excessively difficult, and where the principle of effectiveness would therefore be infringed. It is the most likely example to arise in practice, but it cannot be treated as necessarily exhaustive. The governing principle of effectiveness means that the purchaser must, in principle (and subject to procedural rules which are compatible with the principle of effectiveness, such as reasonable limitation periods), be able to recover from the member state where reimbursement by the taxable person would be impossible or excessively difficult. In the present case, the Lead Claimants had a common law right to restitution of the amounts mistakenly paid to the Managers, whose enforcement was neither impossible nor excessively difficult. The Managers had a statutory right to recover the notional 75 from the Commissioners, under arrangements which ensured that it was passed on to the Lead Claimants. The Managers retained the remaining 25 and were not insolvent. They were therefore in a position to refund it to the Lead Claimants. The only amounts which the Lead Claimants could not recover were the amounts which they had paid during the dead periods, to the extent that those amounts had been paid by the Managers to the Commissioners: that is to say, the notional 75 whose recovery from the Commissioners was time barred under section 80(4) of the 1994 Act. Although a claim by the Lead Claimants against the Managers in respect of the dead periods would not have been time barred, because of the more generous limitation period allowed by section 32(1)(c) of the Limitation Act 1980, the Managers would have a defence of change of position, since the amounts which they paid to the Commissioners during those periods were irrecoverable. The inability of the Lead Claimants to recover those sums is not, however, incompatible with EU law: as explained earlier, it is conceded that the three year limitation period imposed by section 80(4) of the 1994 Act is compatible with EU law. In these circumstances, the inability of the Lead Claimants to pursue a direct claim for restitution against the Commissioners is not incompatible with EU law. That follows from the application of well established principles of EU law. There is therefore no need for any reference to the Court of Justice. Nor is it necessary or appropriate to consider what the position would be in a hypothetical case where the supplier was insolvent: the court has heard no submissions, and has no information before it, as to how reimbursement arrangements under section 80 might operate in that situation. Conclusion For these reasons I would allow the Commissioners appeal and dismiss the Lead Claimants cross appeal.

This appeal and cross appeal arise out of claims made by certain investment trust companies (the ITCs) for refunds of VAT which they had paid on the supply of investment management services from investment managers (the Managers). The VAT transpired not to be due, because the supplies in question were exempt from VAT under EU law. The Managers who received VAT from the ITCs paid it to the Commissioners, believing they were entitled to deduct from the VAT chargeable on their supplies to the ITCs (output tax) the tax which they had themselves paid on supplies received for the purposes of their businesses (input tax). Out of a notional 100 received from the ITCs, the Managers might have therefore accounted to the Commissioners for only 75 after deducting 25 in respect of input tax. When it transpired that the supplies were VAT exempt, the Managers made claims to the Commissioners for refunds under s.80 of the VAT Act 1994, and passed on the refunded VAT and interest to the ITCs. However, under the statute, the Managers were only entitled to a refund of the VAT they had actually paid the Commissioners (i.e. the notional 75). In addition, they could not claim refunds in relation to accounting periods excluded by the three year statutory limitation period under s.80 (the dead periods). The ITCs did not receive the full amount of VAT they had been mistakenly charged and brought proceedings against the Commissioners seeking remedies in unjust enrichment and EU law in respect of the notional 25 and the dead periods. The judge found that the Commissioners had been enriched by the full amount of VAT the ITCs paid to the Managers (i.e the notional 100), but that the ITCs cause of action at common law was excluded by the statutory scheme, which protected the Commissioners from liability other than as provided in s.80. EU law required that exclusion to be disapplied so as to permit a claim, but still subject to the limitation period in s.80. The claim in relation to the dead periods was therefore dismissed, but payment of the notional 25 outside those periods was ordered. Both sides appealed, and the Court of Appeal allowed both appeals. The statutory scheme did not exclude a common law claim, but it was wrong to treat the Commissioners as having been enriched to the extent of the notional 100, where they had only received 75. There was no claim in EU law for the remaining amounts retained by the Managers. Judgment was given for the notional 75 claim in relation to the dead periods, and the claim for the notional 25 (for all periods) was dismissed. The Supreme Court unanimously allows the Commissioners appeal and dismisses the ITCs cross appeal. Lord Reed gives the judgment, with which the rest of the Court agrees. The principal issues to be decided were (i) whether the ITCs in principle could make out a claim in unjust enrichment against the Commissioners, (ii) whether such a claim was excluded by the statutory scheme under s.80 and (iii) whether the lack of any such claim was incompatible with EU law. The extent of the Commissioners enrichment was limited to the notional 75 which they received from the Managers. It did not include the notional 25 which the Managers retained as an input tax credit, because that was not an amount which the Commissioners owed to the Managers: it was only deductible from output tax that was properly due [25 31]. As to whether the Commissioners enrichment was at the expense of the ITCs, there has been uncertainty surrounding the approach to be adopted. It would be unwise to attempt a definitive statement of the circumstances in which the at the expense of requirement would be satisfied, but as a general rule it will be satisfied where there is a direct transfer of value from the claimant to the defendant, and in situations equivalent to direct transfers, for example where an agent is interposed, or where a series of coordinated transactions can be treated as a single transaction. A further situation where the requirement is satisfied is where the claimant discharges a debt owed by the defendant to a third party. The possibility of genuine exceptions to a direct provision rule should not be ruled out, but beyond direct transfers of value, or equivalent situations, it is generally difficult to maintain that the defendant has been enriched at the claimants expense. For there to be a transfer of value, the claimant must incur a loss through the provision of the benefit: incidental benefits alone cannot constitute a transfer of value [32 66]. In the present case there is no direct transfer of value, or equivalent situation. The ITCs payment to the Managers became part of the Managers general assets, and was not impressed with a special purpose trust, while the Managers VAT liability to the Commissioners arose independently of whether the ITCs actually paid VAT. The two transactions are separate and cannot be collapsed into a single transfer of value from the ITCs to the Commissioners [67 74]. Even if the ITCs had in principle been able to make out a claim in unjust enrichment, such a claim would have been excluded by s.80. The statute creates an exhaustive code of remedies not just for suppliers who have accounted to the Commissioners, but for the ultimate consumers as well. This is because it set out arrangements for the supplier to reimburse the consumer, subject to a limitation period, removing the need for the consumer to have a direct remedy against the Commissioners. Parliament cannot have intended this scheme for reimbursement of consumers to exist concurrently with non statutory liabilities that would be inconsistent with the rationale of the statutory scheme [75 88]. The application of the statutory scheme in the present case is compatible with EU law. The European Court of Justice has accepted that in principle, a system under which only the supplier is entitled to seek reimbursement of VAT from the tax authorities, and the consumer can seek restitution from the supplier, meets the requirements of EU law. In cases where the reimbursement of the consumer by the supplier would be impossible or excessively difficult, the principle of effectiveness would require that the consumer be able to bring a claim directly against the tax authorities. That was not the case here, and it would not be appropriate to consider what the position would be in a hypothetical case where a supplier was insolvent [89 94].

8k-16k

These appeals are brought by a Polish national, Roksana Mirga, and an Austrian national, Wadi Samin, against decisions of the Court of Appeal upholding determinations that they were not entitled to certain benefits, namely income support and housing assistance respectively, pursuant to the provisions of United Kingdom domestic law. The arguments have changed somewhat over the course of the two sets of proceedings, but the essential issue raised now is whether the provisions and the current implementation of the domestic law in question infringe the rights of residence in the UK of citizens of European Union member states. Shortly before this judgment was to be delivered, counsel for the appellants informed us of an Opinion which had been delivered by Advocate General Wathelet in Jobcenter Berlin Neuklln v Alimanovic (Case C 67/14) [2016] 2 WLR 208, which they contended assisted their arguments. We decided to await the judgment of the Court of Justice in that case. Judgment was given on 15 September 2015, and the parties have had the opportunity to make written submissions as to its effect on these appeals. It should perhaps be added that, after we received those further submissions, the appellants counsel drew to our attention Advocate General Cruz Villalns Opinion in European Commission v United Kingdom (Case C 308/14), and suggested that we await the judgment of the Court of Justice in that case, or alternatively that we refer these two cases to that court. In my opinion, following the judgment in Alimanovic, any issue on which we have to rule in these appeals is acte clar, and accordingly we should now determine these two appeals. The factual background The facts relating to Ms Mirga Ms Mirga was born in 1988 in Poland. In 1998, she came to this country with her parents and three siblings, but they returned to Poland in 2002 after being refused asylum. Two years later, in June 2004, on Polands accession to the EU, the family returned to the UK. Sadly, her mother died four months later, and her father, who had been working, gave up his job owing to depression a few months afterwards. He received income support until late 2007, when it was decided that he should not have been receiving it, on the ground that he did not have the right of residence in the UK. Meanwhile, Ms Mirga finished her education in April 2005 and embarked on registered work within the meaning of the Accession (Immigration and Worker Registration) Regulations 2004 (SI 2004/1219) (the A8 Regulations). She continued with that registered work until November 2005. In February 2006, she became pregnant and started to do unregistered work, which she continued for two months or so. In June 2006, she left home for rented accommodation, and did a months further unregistered work around June 2006. In August 2006, she claimed income support under the Income Support (General) Regulations 1987 (SI 1987/1967) (the Income Support Regulations) on the grounds of her pregnancy. Her baby son was born in October 2006. The Secretary of State for Work and Pensions refused Ms Mirgas application for income support, and his decision was upheld by the First tier Tribunal, whose decision was affirmed, albeit for different reasons, by Judge Rowland in the Upper Tribunal. The Upper Tribunal decided that the Secretary of State was entitled to refuse Ms Mirgas application because she did not have a right of residence in the UK under the A8 Regulations and therefore was excluded from the ambit of income support by virtue of the Income Support Regulations. The Upper Tribunals decision was upheld by the Court of Appeal in a judgment given by Laws LJ, with which Tomlinson LJ and Sir David Keene agreed [2012] EWCA Civ 1952. The facts relating to Mr Samin Mr Samin was born in Iraq in 1960. After ten years military service, he successfully sought asylum in Austria in 1992, together with his wife and children, and he was accorded Austrian citizenship the following year. Sadly, he became wholly estranged from his wife and children, and he came to the UK in December 2005, since when he has lived in this country on his own. During the ten months following his entry into the UK, he had some paid employment on occasions, often part time, but he has not worked since some time in 2006, and has not been looking for work since 2007. Mr Samin is socially isolated and suffers from poor mental health, principally from clinical depression and post traumatic stress disorder. Having attempted to kill himself in the past, he remains a moderately high risk of suicide in the medium term. He also suffers from diabetes, hypertension and kidney stones, and he needs physiotherapy. After occupying temporary accommodation, Mr Samin lived in a studio flat in North London, which he had to vacate after four years in June 2010. He then applied to Westminster City Council (the Council) for housing under the homelessness provisions in Part VII of the Housing Act 1996 (the Housing Act). After making inquiries, the Council decided that he was a person from abroad who is not eligible for housing assistance within the meaning of section 185(1) of the Housing Act, because he did not have the right of residence in the UK under the Immigration (European Economic Area) Regulations 2006 (SI 2006/1003) (the EEA Regulations). That decision was affirmed in the Central London County Court by His Honour Judge Mitchell, whose decision was in turn upheld by the Court of Appeal for reasons given by Hughes LJ, with which Etherton and Tomlinson LJJ agreed [2012] EWCA Civ 1468; [2012] WLR(D) 336. The legislative background The Treaty on the Functioning of the European Union Under article 18 of the Treaty on the Functioning of the European Union (TFEU), any discrimination on grounds of nationality is prohibited in so far as it is [w]ithin the scope of application of the Treaties. The importance of avoiding discrimination is emphasised by article 19 of TFEU which states that the Council may take appropriate action to combat discrimination . Article 20 of TFEU states in para 1 that every national of an EU member state shall be a citizen of the Union, and, in para 2(a), that citizens of the Union should have the right to move and reside freely within the territory of the member states, albeit that that right is to be exercised in accordance with the conditions and limits defined by the Treaties and by the measures adopted thereunder. Article 21.1 of TFEU provides as follows: Every citizen of the Union shall have the right to move and reside freely within the territory of the member states, subject to the limitations and conditions laid down in the Treaties and in the measures adopted to give them effect. Article 45 of TFEU, which is also concerned with freedom of movement for workers, requires the abolition of any discrimination based on nationality between workers of the member states as regards employment, remuneration and other conditions of work and employment. The 2003 Accession Treaty In 2004, ten countries, including Poland, acceded to the EU pursuant to the Treaty on Accession 2003 (the 2003 Accession Treaty). By virtue of articles 10 and 24 of the Act of Accession forming the second part of the Treaty, existing member states, including the UK, were accorded, by way of derogation, certain transitional powers. Those powers included a right to derogate in relation to the free movement of workers within the EU, which was then governed by Regulation (EEC) No 1612/68 (the 1968 Regulation), in relation to nationals (known as A8 nationals) of eight of the ten new member states. Those powers of derogation in relation to Polish nationals were contained in paragraphs 1 14 of Part 2 of Annex 12 to the 2003 Accession Treaty. So long as these provisions were in force, they enabled a host member state to exclude Polish nationals from freedom of movement rights unless they had been working in that state for an uninterrupted period of 12 months following accession. The 2004 Directive The right of EU nationals to reside in all member states of the EU has been qualified and regulated by EU Instruments, most notably by the 1968 Regulation and by Directive 2004/38/EC of 30 April 2004 (the 2004 Directive), which made substantial amendments to the 1968 Regulation. The 2004 Directive is concerned with the right of citizens of the Union and their family members to move and reside freely within the territory of the member states. The preamble to the 2004 Directive includes the following: (10) Persons exercising their right of residence should not become an unreasonable burden on the social assistance system of the host member state during an initial period of residence. Therefore, the right of residence for Union citizens and their family members for periods in excess of three months should be subject to conditions. (16) As long as the beneficiaries of the right of residence do not become an unreasonable burden on the social assistance system of the host member state they should not be expelled. Therefore, an expulsion measure should not be the automatic consequence of recourse to the social assistance system. The host member state should examine whether it is a case of temporary difficulties and take into account the duration of residence, the personal circumstances and the amount of aid granted in order to consider whether the beneficiary has become an unreasonable burden on its social assistance system and to proceed to his expulsion. In no case should an expulsion measure be adopted against workers, self employed persons or job seekers as defined by the Court of Justice save on grounds of public policy or public security. Recital (31) emphasises that the 2004 Directive should be implemented in a non discriminatory way. Article 6 states that Union citizens shall have the right of residence on the territory of another member state for a period of up to three months without any conditions or any formalities, and that the right extends to family members. Article 7 is concerned with the Right of Residence for more than three months, and it starts as follows: 1. All Union citizens shall have the right of residence on the territory of another member state for a period of longer than three months if they: are workers or self employed persons in the host (a) member state; or (b) have sufficient resources for themselves and their family members not to become a burden on the social assistance system of the host member state during their period of residence and have comprehensive sickness insurance cover in the host member state. Para 1(c) of article 7 deals with students, and para 1(d) and para 2 deal with family members. Article 7.3 provides that a person does not lose the status of a worker or self employed person on ceasing to work in certain circumstances. Those circumstances include (a) if he or she is temporarily unable to work as the result of an illness or accident, and (b) if he or she has been employed for more than a year, is involuntarily unemployed and has registered as a job seeker. Article 8 is concerned with Administrative formalities for Union citizens, and articles 8.1 and 8.2 deal with the right of member states to require Union citizens residing for more than three months to register with the relevant authorities. Articles 8.3 and 8.4 include the following: 3. For the registration certificate to be issued, member states may only require that: Union citizens to whom point (b) of article 7(1) applies present a valid identity card or passport and provide proof that they satisfy the conditions laid down therein; 4. Member states may not lay down a fixed amount which they regard as sufficient resources but they must take into account the personal situation of the person concerned. In all cases this amount shall not be higher than the threshold below which nationals of the host member state become eligible for social assistance, or, where this criterion is not applicable, higher than the minimum social security pension paid by the host member state. Article 14.1 states that the three months right of residence under article 6 applies as long as [the citizen and his or her family] do not become an unreasonable burden on the social assistance system of the host member state. Article 14.2 provides that Union citizens and their family members have the right of residence provided for in [article 7] as long as they meet the conditions set out therein. But article 14.3 states that an expulsion measure should not be the automatic consequence of recourse to the social assistance system. Article 14.4 provides that an expulsion measure shall not be adopted against Union citizens who (a) are workers or self employed persons, or (b) entered the host state to seek employment and can provide evidence that they are continuing to seek employment and that they have a genuine chance of being engaged. Article 24.1 states that all Union citizens residing on the basis of this Directive in the territory of the host member state shall enjoy equal treatment with the nationals of that member state, albeit subject to such specific provisions as are expressly provided for in the Treaty and secondary law. Article 24.2 specifically entitles a member state to refuse social assistance during the first three months of residence, or, where appropriate, the longer period provided for in article 14(4)(b). Article 28 is concerned with Protection against expulsion, and para 1 provides that: Before taking an expulsion decision on grounds of public policy or public security, the host member state shall take account of considerations such as how long the individual concerned has resided on its territory, his/her age, state of health, family and economic situation, social and cultural integration into the host member state and the extent of his/her links with the country of origin. Articles 30 and 31 are concerned with protecting the rights that are the subject of the Directive (and the width of their ambit is emphasised by article 15.1). Article 30 deals with notification, and article 31 deals with Procedural safeguards, including access to judicial redress procedures. Domestic legislation: the EEA Regulations On 30 April 2006, the EEA Regulations came into force in the United Kingdom. They were, as the Explanatory Note explains, intended to implement the 2004 Directive. Regulation 13 of the EEA Regulations provides that all EEA nationals have the right to reside in the UK for three months. Regulation 14 provides that a qualified person is entitled to remain in the UK so long as he is so qualified. Regulation 6 of the EEA Regulations defines what is meant by qualified person. It includes a jobseeker, a worker, a self employed person, a self sufficient person, and a student. Regulation 4, which has been amended on various occasions, is concerned with definitions of most of those expressions, including worker and self sufficient person. Regulation 4(1)(a) defines worker by reference to the TFEU. Regulations 5 and 15 certain workers who [have] ceased activity have a permanent right of residence, and they include (2) those who have retired having worked in the UK for at least 12 months and resided there for at least three years, and (3) those who have stopped working as a result of permanent incapacity, having resided in the UK for at least two years. Regulation 6 extends qualified person status to people who are temporarily no longer working owing to illness or accident, or who worked but are now involuntarily unemployed and registered as jobseekers (but only for six months if they were employed for less than a year), or who have lost their jobs and are in vocational training. Regulation 4(1)(c) of the EEA Regulations provides that: self sufficient person means a person who has i) sufficient resources not to become a burden on the social assistance system of the United Kingdom during his period of residence; and ii) United Kingdom. comprehensive sickness insurance cover in the Regulation 4(2), (3) and (4) contain further provisions dealing with what constitutes sufficient resources, but only para (4) is of any relevance in these proceedings. It has been amended at least twice. Ignoring references to family members which are irrelevant in these two cases, regulation 4(4) now provides that resources are to be regarded as sufficient if (a) they exceed the maximum level which a British citizen may possess if he is to become eligible for social assistance in the UK, or (b) taking into account the personal situation of the person concerned it appears that [his] resources should be regarded as sufficient. The paragraph originally only included what is now sub para (a), and sub para (b) was added in 2011. Regulation 19 of the EEA Regulations is concerned with refusal of admission and removal, and para 3 provides that a person who has been admitted into, or acquired a right to reside in, the UK may be removed if he does not have or ceases to have a right to reside. However regulation 19(4) states that a person cannot be removed as an automatic consequence of having recourse to the social assistance system of the [UK]. Domestic legislation: the A8 Regulations Pursuant to the terms of the 2003 Accession Treaty, the European Union (Accessions) Act 2003 was enacted, which, under section 2, permitted the Secretary of State to make the A8 Regulations (which were revoked in May 2011). Regulations 2 and 5 of the A8 Regulations provided that A8 nationals would only have full access to the UK labour market if they had been in registered employment under the Worker Registration Scheme for a continuous period of 12 months. The consequence was that, so long as the A8 Regulations were in force, A8 nationals could not become qualifying persons under the EEA Regulations unless and until they had performed registered employment for a continuous period of at least 12 months. Domestic legislation: income support Entitlement to income support arises under section 124 of the Social Security Contributions and Benefits Act 1992 and the Income Support Regulations. In very summary terms, income support is available for certain people provided that they are not engaged in relevant work or receiving relevant education, and their income is below the applicable amount. The effect of regulation 21 of the Income Support Regulations, however, is that a person from abroad is to be treated as having an applicable amount of nil, and is therefore not eligible for income support. Regulation 21AA(1) (3) of the Income Support Regulations states that certain people will be treated as persons from abroad unless they are habitually resident in the UK (and certain other places, including Ireland), and have the right to be so under certain statutory provisions not germane to the present appeals. Regulation 21AA(4) provides, however, that a person is not a person from abroad if he is, inter alia, a worker (or self employed person, or is to be treated as a worker or self employed person) within the meaning of the 2004 Directive. Domestic legislation: housing assistance Part VII of the Housing Act imposes duties on local housing authorities in relation to homeless people. The duty extends, under section 193, to providing them with accommodation where they are involuntarily homeless and in priority need unless they are not eligible for assistance. Eligibility for assistance is dealt with in section 185 of the Housing Act, which provides, inter alia, that a person who is subject to immigration control is ineligible for housing assistance unless of a class prescribed by regulations, along with any other person from abroad treated as ineligible by virtue of regulations. The Allocation of Housing and Homelessness (Eligibility) (England) Regulations 2006 (SI 2006/1294) (the Eligibility Regulations) define the classes of persons subject to immigration control who are eligible for housing assistance and the classes of other persons from abroad who are ineligible, and the effect of regulations 2(2) and 6(2) is that a person from abroad is eligible if he is a worker for the purposes of the definition of a qualified person in regulation 6(1) of the EEA Regulations. The issues raised on these appeals Mr Coppel QC and Ms Rogers, on behalf of the Secretary of State, contend that, at the time that Ms Mirga applied for income support, she was ineligible for income support under the Income Support Regulations, because she was a person from abroad. This was on the basis that she could not claim to be a worker as she was an A8 national who had not done 12 months registered employment (under the A8 Regulations), and thus could not be a qualifying person for the purpose of the EEA Regulations. Even if the A8 Regulations did not apply, Mr Coppel argues that Ms Mirga would still not have been a worker, as the EEA Regulations would have required her to have worked for at least 12 months before she claimed income support. There is no question of Ms Mirga having been a jobseeker, a self employed person, or a student under the EEA Regulations. Further, it seems clear that Ms Mirga could not claim to be a self sufficient person under the EEA Regulations, as she had no significant means of support and no health insurance (but if she had had been a self sufficient person she would presumably not have needed income support anyway). With the support of the Secretary of State for Communities and Local Government, Mr Peacock contends for the Council that Mr Samin is not a worker within the EEA Regulations because he is now permanently incapable of work, and in any event he cannot claim to be a worker because he has not worked for 12 months in the UK. Accordingly, argues Mr Peacock, Mr Samin is not a qualified person under the EEA Regulations, from which it follows that he is ineligible for the purposes of the Housing Act. It is also said that Mr Samin cannot claim to be a self sufficient person within the EEA Regulations because he has no assets and no health insurance. The first argument raised by Mr Drabble QC, who appears with Ms Leventhal on behalf of Ms Mirga, is that, in the light of her right to respect for her private and family life, under article 8 of the European Convention on Human Rights, she cannot be removed from the UK, and therefore her right of residence in the UK, as accorded by article 21.1 of TFEU, cannot be limited or cut back in the way that the Income Support Regulations seek to do, namely by restricting her rights to income support because she has not achieved a continuous 12 month period in registered employment. His alternative argument is that, even if it would be permissible to refuse Ms Mirga income support on that ground, it is only possible in practice if it would be proportionate to do so, and in particular if the grant of income support to her would place an unreasonable burden on the social assistance system of the UK, and there has been no inquiry into that question. The first argument raised on behalf of Mr Samin by Mr Drabble, appearing with Mr Carter and Mr Cowan, is that the refusal of housing assistance to Mr Samin constituted unlawful discrimination in breach of article 18 of the TFEU, even though he may not have had a right of residence in the UK. The alternative argument raised on behalf of Mr Samin reflects the alternative argument in Ms Mirgas case, namely that there should have been an investigation as to whether it was proportionate to refuse Mr Samin housing assistance, in particular on the ground that it represented an unreasonable burden of the UK social assistance system. Mr Drabbles arguments were supported by Ms Demetriou QC, assisted by Mr Banner and Ms MacLeod, on behalf of The AIRE Centre, and it is right to record the courts appreciation of their pro bono work in this case, and their assistance to the court. Discussion Issue one: do the domestic Regulations infringe the appellants TFEU rights? Mr Drabbles first contention on behalf of Ms Mirga is that, as she is a worker (albeit one whose work was temporarily interrupted owing to her pregnancy), article 21.1 of TFEU accords her the right to reside freely within the EU, and therefore within the UK, and that the denial of income support to her, at a time when she needed it in order to be able to live in the UK, was an impermissible interference with that right, as she would, in practice, be forced to return to Poland. That argument can be said to reflect the fundamental importance of freedom of movement and freedom of establishment to the single market concept, as well as the significance attached in articles 18 and 19 of TFEU to the avoidance of discrimination between citizens of a member state and other EU nationals. A similar argument cannot be run in relation to Mr Samin, because it is now accepted that owing to his inability to work he cannot claim to be a worker, even in the light of the extended definition in article 7.3 of the 2004 Directive and regulation 6 of the EEA Regulations. Accordingly, Mr Drabbles first line of argument on behalf of Mr Samin is that the Councils refusal to provide Mr Samin with housing assistance under Part VII of the Housing Act constituted discrimination on grounds of nationality prohibited by article 18 of TFEU, because such assistance would have been accorded to a citizen of the UK, or a qualifying worker from another member state, who was otherwise in the same position as Mr Samin. It seems to me that these arguments face real difficulties. The right accorded by article 21.1 of TFEU, which is relied on by Ms Mirga, although fundamental and broad, is qualified by the words subject to the limitations and conditions laid down in the Treaties and in the measures adopted to give them effect. In the present case, the measures include the 2004 Directive, and presumably include the 2003 Accession Treaty, which was adopted under article 49 of the Treaty on European Union. It appears clear from the terms of paragraph 10 of the preamble that it was a significant aim of the 2004 Directive that EU nationals from one member state should not be able to exercise their rights of residence in another member state so as to become an unreasonable burden on the social assistance system. It also seems clear that any right of residence after three months can be subject to conditions. This is reflected in the terms of article 7.1, in that it limits the right of residence after three months to those who are workers, self employed, students, or with sufficient resources and health insurance not to become a burden on the social assistance system of the host member state. Indeed, it is worth noting that article 14.1 even limits the right of residence in the first three months. It further appears clear from article 24, that EU nationals right of equal treatment in host member states is subject to secondary law, and in particular that they can be refused social assistance where appropriate. Accordingly, when one turns to the 2003 Accession Treaty and the 2004 Directive, I consider that, because Ms Mirga has not done 12 months work in this country, she cannot claim to be a worker, and, because she is not a jobseeker, self employed, a student, or self sufficient, it would seem to follow that she can be validly denied a right of residence in the UK, and therefore can be excluded from social assistance. In those circumstances, it must follow that article 21.1 TFEU cannot assist her. The fact that Ms Mirga may have to cease living in the UK to seek assistance in Poland does not appear to me to assist her argument. Although the refusal of social assistance may cause her to leave the UK, there would be no question of her being expelled from this country. I find it hard to read the 2004 Directive as treating refusal of social assistance as constituting a species of constructive expulsion even if it results in the person concerned leaving the host member state. As I see it, the Directive distinguishes between the right of residence and the act of expulsion. However, quite apart from this, the Directive makes it clear that the right of residence is not to be invoked simply to enable a national of one member state to obtain social assistance in another member state. On the contrary: the right of residence is not intended to be available too easily to those who need social assistance from the host member state. Mr Samins first argument appears to me to face similar difficulties. The article 18 right which he relies on does not constitute a broad or general right not to be discriminated against. First, its ambit is limited to the scope of the Treaties, which means that it only comes into play where there is discrimination in connection with a right in the TFEU or another EU Treaty. Secondly, the article 18 right is without prejudice to any special provisions contained [in the Treaties]. That brings one back to the argument raised on behalf of Ms Mirga. Contrary to the appellants argument, I do not consider that the decision of the Third Chamber in Pensionsversicherungsanstalt v Brey (Case C 140/12) [2014] 1 WLR 1080 provides the appellants with much assistance. However, it is unnecessary to consider that possibility, because it seems to me clear that the first point raised by each appellant must be rejected as acte clar following the recent Grand Chamber judgments in Dano and another v Jobcenter Leipzig (Case C 333/13) [2015] 1 WLR 2519 (which was published after the Court of Appeal decided these cases) and in Alimanovic (Case C 67/14) EU:C:2015:597, which, as mentioned above, was published some time after the hearing of these appeals. It is appropriate to set out in summary terms the effect of those three decisions, not least because they have relevance to the second issue raised on behalf of each appellant, as well as the first. In Brey, the applicant was a German national residing in Austria, who received a German pension and care allowance insufficient for his needs, and who was refused a compensatory supplement from the Austrian government, because he did not meet the necessary national residency requirements, which excluded those who did not have sufficient resources not to be a burden on the Austrian social security system. Shortly after that refusal, the Austrian government issued the applicant with an EEA citizen registration certificate. The question referred to the Court of Justice by the Austrian Oberster Gerichtshof was whether article 7(1)(b) of Directive 2004/38 should be interpreted as meaning that, for the purposes of that provision, the concept of social assistance covers a benefit such as the compensatory supplement (para 26). The Chamber ruled, at para 80, that the 2004 Directive precluded national legislation which automatically whatever the circumstances bars the grant of a benefit, such as the compensatory supplement to a national of another member state who is not economically active, on the grounds that, despite having been issued with a certificate of residence, he does not meet the necessary requirements for obtaining the legal right to reside since obtaining that right of residence is conditional on that national having sufficient resources not to apply for the benefit. In Dano, the applicant and her son were Romanian nationals living in Germany (where the son had been born), and she had been issued with an unlimited residence certificate. The applicant neither had worked nor was looking for work, and she and her son were refused maintenance payments. The Sozialgericht Leipzig referred a number of questions to the Court of Justice, and the Grand Chamber concluded that article 24 of the 2004 Directive and article 4 of Regulation 883/2004 (which concerns the coordination of social security systems, and includes a similar anti discrimination provision to the 2004 Directive): must be interpreted as not precluding legislation of a member state under which nationals of other member states are excluded from entitlement to certain special non contributory cash benefits within the meaning of article 70(2) of Regulation 883/2004, although those benefits are granted to nationals of the host member state who are in the same situation, in so far as those nationals of other member states do not have a right of residence under Directive 2004/38 in the host member state. (para 84) In Alimanovic, Mrs Alimanovic and her three children were Swedish nationals who had gone to Germany and had been issued with a certificate of right to permanent residence. She and her children were refused subsistence and social allowances, and when they challenged this, the Bundessozialgericht referred three questions to the Court of Justice. The Grand Chamber ruled, at para 63, that article 24 of the 2004 Directive: must be interpreted as not precluding legislation of a member state under which nationals of other member states who are in a situation such as that referred to in article 14(4)(b) of that Directive are excluded from entitlement to certain special non contributory cash benefits within the meaning of article 70(2) of Regulation No 883/2004, which also constitute social assistance within the meaning of article 24(2) of Directive 2004/38, although those benefits are granted to nationals of the member state concerned who are in the same situation. In para 60 of Dano, the Grand Chamber said that the right granted by article 18 of TFEU was subject to the restrictions I have mentioned in paras 43 and 44 above, and the court referred in support to the decision in Brey, and in particular paras 46ff. In para 46 of Brey, the Chamber had referred to the right of nationals of one member state to reside in the territory of another members state without being employed or self employed as being not unconditional. It is also worth noting that the Grand Chamber also referred to article 20 of TFEU and article 24 of the 2004 Directive in terms which made it clear that the rights they grant should, in the instant context, be treated similarly to the rights granted by article 18. In para 61 of Dano, the Grand Chamber described the right under article 18 of the TFEU as having been given more specific expression in article 24 of [the 2004 Directive]. In para 63, citing Brey, para 61, the court pointed out that if someone has recourse to assistance schemes established by the public authorities, he may during his period of residence, become a burden on the public finances of the host member state which could have consequences for the overall level of assistance which may be granted by that state. In para 69, it was made clear that a Union citizen can claim equal treatment with nationals of the host member state only if his residence in the territory of the host member state complies with the conditions of [the 2004 Directive]. In para 73, the court summarised the effect of article 7(1) of the 2004 Directive, and said in the following paragraph that, if persons who do not have a right of residence under [the 2004 Directive] may claim entitlement to social benefits under the same conditions as those applicable to nationals [that] would run counter to an objective of the Directive. In para 76, the purpose of article 7(1)(b) of the 2004 Directive was described as being to prevent economically inactive Union citizens from using the host members states welfare system to fund their means of subsistence. Finally, in para 80 the Grand Chamber said that a persons financial situation should be examined specifically in order to determine whether he meets the condition of having sufficient resources to qualify under article 7.1(b). As already mentioned, the authority of the decision in Dano has been reinforced by the decision in Alimanovic, where, in paras 44 and 50 respectively, the Grand Chamber specifically referred to what was said in paras 63 and 69 of the judgment in Dano with approval. More broadly, as explained more fully below, the Grand Chamber in Alimanovic confirmed that a Union citizen can claim equal treatment with nationals of a country, at least in relation to social assistance, only if he or she can satisfy the conditions for lawful residence in that country. Thus, it was confirmed that article 24.2 of the 2004 Directive was, in effect, a valid exception to the principle of non discrimination. Dano and Alimanovic clearly demonstrate that the jurisprudence of the Grand Chamber of the Court of Justice is inconsistent with Mr Drabbles first argument on behalf of Ms Mirga and Mr Samin, at least in so far as his argument is focussed on the 2004 Directive. It is fair to say that those cases were not concerned with the 2003 Accession Treaty. However, the House of Lords concluded in Zalewska v Department for Social Development [2008] 1 WLR 2602 that the A8 Regulations, which reflect the provisions of the 2003 Accession Treaty, were consistent with EU law, and nothing I have heard or read in connection with this appeal casts doubt on that conclusion. In particular, it appears to be consistent with the reasoning in Brey, Dano and Alimanovic. The only possible remaining issue in relation to this first set of arguments could be whether (i) in the case of Ms Mirga, the provisions of the Income Support Regulations, when read together with the A8 Regulations and the EEA Regulations, and (ii) in the case of Mr Samin, the provisions of the Eligibility Regulations, when read together with the EEA Regulations, complied with the requirements of the 2003 Accession Treaty and the 2004 Directive. As I understood his contentions, Mr Drabble did not suggest any discrepancy in the domestic regulations unsurprisingly, as they were clearly intended to implement the EU instruments. Accordingly, in my judgment, following the clear guidance from the Grand Chamber in Dano and Alimanovic, the first arguments raised on behalf of Ms Mirga and Mr Samin cannot be maintained. That leaves their alternative arguments raised in the two appeals, based on proportionality. Issue two: the appellants argument based on lack of proportionality Mr Drabbles second argument in both appeals is that the determination of the authorities and the courts and tribunals below in the case of both Ms Mirga and Mr Samin was flawed because no consideration was given to the proportionality of refusing each of them social assistance bearing in mind all the circumstances of their respective cases, and in particular that the authority or tribunal concerned failed to address the burden it would place on the system if they were to be accorded the social assistance which they sought. In that connection, Mr Drabble relied on the Court of Justices decisions in St Prix v Secretary of State for Work and Pensions (Case C 507/12) [2014] PTSR 1448, Baumbast v Secretary of State for the Home Department (Case C 413/99) [2003] ICR 1347 and Brey. St Prix was concerned with the question whether a person ceased automatically to be a worker for the purpose of the 2004 Directive, and therefore the EEA Regulations, if she temporarily ceased work owing to the fact that she was pregnant. It provides no assistance to the appellants arguments as advanced by Mr Drabble, except to emphasise the purposive approach to be adopted to the interpretation of the 2004 Directive. The effect of the decision of Baumbast is that the fact that an applicant may fall short of the strict requirements of having self sufficiency status under what are now the 2004 Directive and the EEA Regulations cannot always justify the host member state automatically rejecting his or her right to reside on the ground that the requirements for that status are not wholly complied with. In Baumbast the court was concerned, inter alia, with the issue whether an applicant could exercise the right to reside in the UK in circumstances where he was resting his case on the ground that he was a self sufficient person. It is clear from paras 88 and 89 of the judgment that the applicant had sufficient resources to be self sufficient in practice, and that he had medical insurance. His only possible problem was that the insurance may have fallen short of being comprehensive in one respect, namely that it was not clear whether it covered emergency treatment. The court held that, on the assumption that the insurance fell short in this connection, it would nonetheless be disproportionate to deprive the applicant of his right to reside. In para 92, the court pointed out that there were strong factors in the applicants favour, namely that he had sufficient resources, that he had worked and resided in the UK for several years, that his family had also resided in the UK for several years, that he and his family had never received any social assistance, and that he and his family had comprehensive medical insurance in Germany. In those circumstances, the court said in para 93 that it would be a disproportionate interference with the exercise of the applicants right of residence conferred by what is now article 21.1 of TFEU to refuse to let him stay in the UK because of a small shortfall in the comprehensiveness of his medical insurance. I do not consider that the appellants derive any assistance from Baumbast. Mr Baumbasts case was predicated on the fact that he did not need any assistance from the state. Even if the decision is relied on by analogy, it is of no help to the appellants. The thrust of the courts reasoning in that case was that, where an applicants failure to meet the requirements of being a self sufficient person was very slight, his links with the host member state were particularly strong, and his claim was particularly meritorious, it would be disproportionate to reject his claim to enjoy the right of residence in that host state. Even though the applicant had a very strong case in the sense that he fell short of the self sufficiency requirements in one very small respect, the court decided that he could rely on disproportionality only after considering the position in some detail. Mr Drabbles argument appears to derive greater assistance from some of the reasoning of the Third Chamber in Brey, where the Third Chamber held that the complementary supplement was social assistance within the meaning of the 2004 Directive and also that it was open to member states to provide such assistance to economically inactive citizens of other member states in any circumstances. Crucially, argues Mr Drabble, the Austrian governments refusal of the complementary supplement to the applicant was held to be unlawful. The central reasoning of the Third Chamber in Brey for present purposes is in paras 75 78. In para 75, having considered a number of points, the court concluded that the mere fact that a national of a member state receives social assistance is not sufficient to show that he constitutes an unreasonable burden on the social assistance system of the host member state. In the following paragraph, the court stated that the fact that a non national has applied for the benefit in issue in that case was not sufficient to preclude [him] from receiving it, regardless of the duration of residence, the amount of the benefit, and the period for which it is available. In para 77, the court made the point that domestic legislation, such as the Austrian law in that case, could not provide that a national of another member state, who was not a worker, self employed or a student, should be automatically barred from receiving a social benefit. In the next paragraph, the court stated that the competent authorities should be able when examining the application of a Union citizen who is not economically active and is in Mr Breys position to take into account certain factors. They included the amount and regularity of [the applicants] income, the fact that he had received a certificate of residence, the period for which he would receive the benefit, and the extent of the burden [it] would place on the social security system (which as Advocate General Wathelet said in Dano at paras 111 112 of his Opinion, must be a collective assessment, which was confirmed by the Grand Chamber in para 62 of Alimanovic). These factors were, the court said in para 78 of the judgment in Brey, for the domestic court to assess. Brey was an unusual case, because the applicant had been issued with a certificate of residence by the Austrian government, a factor which appears to have played a significant part in the courts thinking, as it was recited in the re formulated question (in para 32) and it is referred to expressly and impliedly in the crucial para 78 of the judgment, and indeed in the final ruling of the Third Chamber (see para 49 above). However, it is not necessary to address that point further, as it appears to me that the reasoning in Brey cannot assist the appellants on the instant appeals, in the light of the subsequent reasoning of the Grand Chamber in the subsequent decisions in Dano and Alimanovic. The observations of the Grand Chamber in Dano discussed in para 53 above are in point. In Alimanovic, para 59, the Grand Chamber specifically mentioned that the court in Brey had stated that a member state [was required] to take account of the individual situation of the person concerned before it finds that the residence of that person is placing an unreasonable burden on its social assistance system. However, the Grand Chamber went on to say that no such individual assessment is necessary in circumstances such as those in issue in this case. In para 60, the Grand Chamber explained that: Directive 2004/38, establishing a gradual system as regards the retention of the status of worker which seeks to safeguard the right of residence and access to social assistance, itself takes into consideration various factors characterising the individual situation of each applicant for social assistance and, in particular, the duration of the exercise of any economic activity. The court then went on to explain that article 7 of the 2004 Directive, when read with other provisions, guarantees a significant level of legal certainty and transparency in the context of the award of social assistance by way of basic provision, while complying with the principle of proportionality. (In this connection, the Grand Chamber took a different view from that taken by Advocate General Wathelet in paras 105 111 of his Opinion, upon which Mr Drabble had understandably relied.) In my view, this makes good sense: it seems unrealistic to require an individual examination of each particular case. I note that this was a proposition which the Second Chamber rejected, albeit in a somewhat different (and probably less striking) context, on the ground that the management of the regime concerned must remain technically and economically viable see Dansk Jurist og konomforbund v Indenrigs og Sundshedsministeriet (Case C 546/11) [2014] ICR 1, para 70, which was cited with approval in the present context by Advocate General Wahl in Dano at para 132 of his Opinion. Where a national of another member state is not a worker, self employed or a student, and has no, or very limited, means of support and no medical insurance (as is sadly the position of Ms Mirga and Mr Samin), it would severely undermine the whole thrust and purpose of the 2004 Directive if proportionality could be invoked to entitle that person to have the right of residence and social assistance in another member state, save perhaps in extreme circumstances. It would also place a substantial burden on a host member state if it had to carry out a proportionality exercise in every case where the right of residence (or indeed the right against discrimination) was invoked. Even if there is a category of exceptional cases where proportionality could come into play, I do not consider that either Ms Mirga or Mr Samin could possibly satisfy it. They were in a wholly different position from Mr Baumbast: he was not seeking social assistance, he fell short of the self sufficiency criteria to a very small extent indeed, and he had worked in this country for many years. By contrast Ms Mirga and Mr Samin were seeking social assistance, neither of them had any significant means of support or any medical insurance, and neither had worked for sustained periods in this country. The whole point of their appeals was to enable them to receive social assistance, and at least the main point of the self sufficiency test is to assist applicants who would be very unlikely to need social assistance. Whatever sympathy one may naturally feel for Ms Mirga and Mr Samin, their respective applications for income support and housing assistance represent precisely what was said by the Grand Chamber in Dano, para 75 (supported by its later reasoning in Alimanovic) to be the aim of the 2004 Directive to stop, namely economically inactive Union citizens using the host member states welfare system to fund their means of subsistence. Conclusion I would dismiss both these appeals.

These two appeals concern the claims of two EU nationals to claim benefits in the United Kingdom. Ms Mirga was born in Poland and, having previously lived in the UK with her parents for four years, moved back here in 2004. The benefit rights of people from Poland in the UK were mostly governed by the Accession (Immigration and Worker Registration) Regulations 2004 (SI 2004/1219) (the A8 Regulations) which were enacted to give effect to the Treaty on Accession 2003 (the Accession Treaty) under which Poland (and seven other countries) joined the EU. After finishing her education in April 2005, she carried out registered work within the meaning of the A8 Regulations for seven months. She then became pregnant and did around three months of unregistered work. Ms Mirga claimed income support in August 2006 under the Income Support (General) Regulations (SI 1987/1967) (the Income Support Regulations) on the grounds of pregnancy. The Secretary of State refused Ms Mirgas application for income support and his decision was upheld by the First tier Tribunal. The Upper Tribunal and then the Court of Appeal affirmed that decision, on the ground that Ms Mirga did not have a right of residence in the UK under the A8 Regulations and therefore was excluded from income support by the Income Support Regulations. Mr Samin was born in Iraq in 1960. In 1992, he and his family were granted asylum in Austria in 1992 and he was granted Austrian citizenship the following year. He then became estranged from his wife and children and came to the UK in December 2005, since when he has lived here alone. Where the A8 Regulations do not apply, the benefit rights of EU nationals in the UK are mostly governed by the Immigration (European Economic Area) Regulations 2006 (SI 2006/1003) (the EEA Regulations), issued pursuant to EU Directive 2004/38/EC (the 2004 Directive). Mr Samin is socially isolated and suffers from poor mental and physical health. Mr Samin occupied private accommodation until 2010, when he applied to Westminster City Council (the Council) for housing under the homelessness provisions of the Housing Act 1996 (the Housing Act). The Council decided that he was a person from abroad who is not eligible for housing assistance within the meaning of section 185(1) of the Housing Act, because he did not have the right of residence in the UK under the EEA Regulations. That decision was affirmed in the Central London County Court, whose decision was in turn upheld by the Court of Appeal. The Supreme Court unanimously dismisses both Ms Mirgas and Mr Samins appeals for reasons set out in a judgment given by Lord Neuberger (with which Lady Hale, Lord Kerr, Lord Clarke and Lord Reed agree). Submissions of the parties The Secretary of State contended that the Court of Appeals decisions were right. At the time she applied for it, Ms Mirga was ineligible for income support because she was a person from abroad, and could not claim to be a worker as she was an A8 national who had not done 12 months employment and thus could not qualify under the A8 Regulations. Even if the A8 Regulations did not apply, the Secretary of State argued, Ms Mirga would not have been a worker under the EEA Regulations as she had not worked for 12 months before claiming income support [36]. In respect of Mr Samin, the Council contended that he was not a worker within the EEA Regulations because he is now incapable of work and had not worked for 12 months in the UK [37]. In response to these contentions, two arguments were raised on behalf of Ms Mirga and Mr Samin. The first argument rested on the Treaty on the Functioning of the European Union (the TFEU). Ms Mirga contended that, given her right to respect for family and private life under article 8 of the European Convention on Human Rights, and given that she had been a worker, albeit not for the requisite period under the A8 Regulations (or the EEA Regulations), she could not be removed from the UK; accordingly, she contended, her right of residence under article 21.1 of TFEU could not lawfully be cut back by restricting her right to income support as the Income Support Regulations purport to do [38, 41]. Mr Samin argued that refusal of housing assistance to him constituted unlawful discrimination contrary to article 18.1 of the TFEU because such assistance would have been accorded to a citizen of the UK or a qualifying member from another member state who was in the same position as Mr Samin [39, 42]. Ms Mirgas alternative argument was that, even if the Income Support Regulations could have the effect for which the Secretary of State contended, it would only be so if it could be shown that providing her with income support would be disproportionate i.e. if it would place an unreasonable burden on the UK social assistance system, and there has been no inquiry into that question [38, 58]. To much the same effect, Mr Samins alternative argument was that the refusal of housing allowance to him could only be justified if it could be shown that the grant of such an allowance would be disproportionate and there had been no inquiry into that question [58]. The first issue: do the domestic Regulations infringe the appellants TFEU rights? The right accorded to Ms Mirga by article 21.1 of TFEU is qualified by the words subject to the limitations and conditions laid down in the Treaties and by the measures adopted to give them effect. In the present case, the measures include the Accession Treaty and the 2004 Directive, and hence the A8 Regulations and the EEA Regulations respectively [43]. A significant aim of these measures was to ensure that EU nationals from one member state should not be able to exercise their rights of residence in another member state so as to become an unreasonable burden on the social assistance system. Further, any right of residence after three months can be subject to conditions, and EU nationals can be refused social assistance where appropriate [44]. Whether the Accession Treaty or the 2004 Directive applied, Ms Mirga has not done 12 months work in the UK, and therefore cannot claim to be a worker, and she is not a jobseeker, self employed, a student or self sufficient. Therefore she can be validly denied a right of residence in the UK and can be excluded from social assistance. Article 21.1 of TFEU therefore cannot assist her [45]. The article 18 right claimed by Mr Samin is limited to the scope of the Treaties, which means that it only comes into play where there is discrimination in connection with a right in the TFEU or another EU treaty. Further, the right is without prejudice to any special provisions contained in the Treaties. Therefore, Mr Samins argument fails for the same reasons that Ms Mirgas does [47]. Examination of recent judgments of the Court of Justice of the European Union (CJEU), especially Dano v Jobcenter Leipzig [2015] All ER (EC) 1 and Case C 67/14 Jobcenter Berlin Neukolin v Alimanovic clearly support this conclusion. [48 57] The second issue: the arguments based on lack of proportionality The argument that the determinations of the courts and tribunals below in relation to Ms Mirgas claim and Mr Samins claim were flawed because no consideration was given to the proportionality of refusing each of them social assistance is rejected. The judgments of the CJEU relied on by the appellants do not support the argument [58 66]. On the other hand, the judgment and reasoning in Dano, supported by the judgment in Alimanovic undermine the argument [66, 67, 71]. It is unrealistic to require an individual examination of each particular case, as is recognised by the jurisprudence from the CJEU [68]. Where a national of another member state is not a worker, self employed or a student and had no, or very limited, means of support and no medical insurance, it would undermine the whole thrust of the 2004 Directive if proportionality could be invoked to entitle that person to have the right of residence and social assistance in another member state, save perhaps in extreme circumstances [69]. It would also place a substantial burden on a host member state if it had to carry out a proportionality exercise in every case where the right or residence or the right against discrimination was invoked [69]. Even if there is a category of exceptional cases where proportionality would come into play, Mr Samin and Ms Mirga do not fall into it [70].

8k-16k

Do the principles referable to the admissibility of fresh evidence on appeal, as propounded in the decision of the Court of Appeal in Ladd v Marshall [1954] 1 WLR 1489, have any relevance to the determination of a spouses application to set aside a financial order in divorce proceedings on the ground of a fraudulent non disclosure of resources on the part of the other spouse? The trial judge cast his judgment on two alternative grounds and in his analysis of one ground he identified a particular relevance for the principles propounded in the Ladd case. It is now accepted that, in so holding, he was wrong and that the Court of Appeal was right so to declare. But, when so declaring, the Court of Appeal purported to identify a different relevance for the principles propounded in the Ladd case to the determination of an application to set aside. The main point of general importance which generates this further appeal is whether the Court of Appeal was right to hold that those principles have any relevance to such a determination. Introduction Mrs Gohil (whom I will call the wife notwithstanding that she was divorced from Mr Gohil, the husband, in 2004) appeals against an order of the Court of Appeal dated 13 March 2014. By a judgment delivered by McFarlane LJ, with which Arden and Pitchford LJJ agreed, the Court of Appeal then explained its decision to set aside an order made by Moylan J on 25 September 2012, [2012] EWHC 2897 (Fam); the judgments of the Court of Appeal are numbered [2014] EWCA Civ 274 and it is clear that a decision was made to report them at the highest level of authority, namely as Gohil v Gohil (No 2) [2015] Fam 89. The order of Moylan J had been to set aside part of a financial order which, by consent, Baron J had made against the husband in favour of the wife on 30 April 2004, namely the part by which she had dismissed all the wifes remaining claims against him for capital provision. Moylan J had proceeded to order that her claims be listed for further directions to be given in aid of their ultimate determination. The effect of the order of the Court of Appeal was therefore to prevent the wife from asking the court to revisit the level of capital provision made by the husband for her under the order dated 30 April 2004. This court directed that the wifes appeal be heard at the same time as the appeal in Sharland v Sharland, [2015] UKSC 60, which also raised issues in relation to the determination of a spouses application for a further hearing of her claims on the ground of the others fraudulent non disclosure of resources. Convenient though the conjoined hearing proved to be, it has nevertheless been considered preferable for the courts judgments on the two appeals to be given separately, albeit upon this same day. The wife is now aged 51. The husband is now aged 50. They were married in 1990 and lived in a house in Chislehurst owned and also occupied by the husbands parents. The parties had three children, all now adult. The husband was a solicitor and became a partner in a small firm in Mayfair, some of whose clients, often living overseas, had, by fair means or foul, become wealthy and sought the firms assistance in protecting their wealth. In 2002 the wife, with the children, moved out of the house in Chislehurst and she petitioned for divorce. In response to her financial claims the husband asserted that in effect all his ostensible wealth represented assets held by him on behalf of his clients. Shortly prior to 30 April 2004 he produced a balance sheet of what he alleged to be his personal assets which, when set against his liabilities, yielded a net deficit of 311,512. The settlement of the wifes claims was achieved at a Financial Dispute Resolution (FDR) meeting conducted by Baron J on 30 April 2004. There was a recital [recital 14] to the order then made, namely that the [wife] believes that the [husband] has not provided full and frank disclosure of his financial circumstances (although this is disputed by the [husband]), but is compromising her claims in the terms set out in this consent order despite this, in order to achieve finality. The order dated 30 April 2004 provided that the husband should make to the wife, in final settlement of her capital claims, a lump sum payment of 270,000, payable as to 100,000 by 30 June 2004 and as to the balance immediately prior to the wifes exchange of contracts for the purchase of a home. The husband alleged that he could make these payments only as a result of promised assistance on the part of his family. The order also provided for him to make periodical payments to the wife of 6,000 pa from 1 January 2005 during their joint lives until her remarriage or further order, together with periodical payments for the children. The husband duly paid the first instalment of the lump sum and in 2009, following a variation of the condition for its payment, he paid the balance. He complied with the orders for periodical payments only until 2008, since when no such payments have been made. Meanwhile, in 2007, the wife had applied for an order setting aside the order dated 30 April 2004 on the ground of the husbands fraudulent non disclosure of his resources at that time. The wifes application took the form of a simple notice issued within the divorce proceedings. The first four hearings for directions were conducted by Baron J because she had made the substantive order; then in 2008 she ruled that, having conducted the privileged FDR meeting, she should not continue to have conduct of the application. Following ten further interlocutory hearings spread over three years, the substantive hearing of the wifes application began before Moylan J on 13 February 2012. The major reason for the delay was that in 2008 the husband had been charged with offences of money laundering to a value of about 25m contrary to sections 327 and 328 of the Proceeds of Crime Act 2002 (the 2002 Act). The prosecution case had been that from mid 2005 the husband had assisted Mr Ibori, who had been a state governor in Nigeria, in the laundering of money which in that capacity Mr Ibori had corruptly obtained. In the criminal proceedings orders had been made restraining the husband from deploying his assets. In November 2010, following an eight week trial, the husband had been found guilty and remanded in custody. Thereupon a second trial had begun, at which the husband pleaded guilty to six further counts of money laundering and conspiracy to defraud. In April 2011 the husband had been committed to prison for a total of ten years, whereupon the Crown Prosecution Service (the CPS) had launched confiscation proceedings against him under the 2002 Act. They are still on foot and the husband remains in prison. Moylan J heard the wifes application over eight days in February and June 2012. The wife, who gave oral evidence, had sporadic legal representation but largely conducted the case herself. The husband, who was produced from prison in order to give oral evidence, was represented pursuant to a civil aid certificate by counsel other than counsel who have represented him in the successive appeals. The husbands father, who lives in India, gave evidence on behalf of the wife by video link. On 30 May 2012, when the wifes application was part heard, Moylan J ordered the CPS to make extensive disclosure of documents which it had obtained for the purpose of the criminal proceedings against the husband: [2013] 1 FLR 1003. It had opposed the order on the basis that many of the documents or their contents had been obtained from sources outside the UK pursuant to requests made by the Crown Court under the Crime (International Co operation) Act 2003 (the 2003 Act) and that section 9(2) of it precluded any use of them other than that specified in the requests. Applying the decision of the Court of Appeal in BOC Ltd v Instrument Technology Ltd [2001] EWCA Civ 854, [2002] QB 537, Moylan J rejected the construction of section 9(2) for which the CPS contended. The CPS appealed to the Court of Appeal against Moylan Js order and in the interim his order for disclosure was stayed. On 25 September 2012 Moylan J delivered a reserved, oral judgment, by which he granted the wifes application and set aside the order which had dismissed her remaining capital claims against the husband. The judge resolved not at that stage to set aside the order for payment of the lump sum in case its consequence should be that the lump sum, by then in the wifes hands, became subject to the restraint order obtained by the CPS against the husband. In giving judgment Moylan J, no doubt sensitive to the existing delays, did not await the determination of the pending appeal of the CPS against his order dated 30 May 2012. It follows that he never saw the documents which were the subject of that order. But the contents of some of the documents had been in evidence before him. For reference had been made to them in open court in the course of the husbands criminal trials, which the wife had attended; Moylan J had allowed her to relay in her evidence to him some of what she had then heard for challenge or otherwise by the husband; and no doubt some of her evidence in this regard reflected material which the CPS had obtained pursuant to requests made under the 2003 Act. In his judgment Moylan J laid great stress on some of the evidence thus relayed to him from the criminal trials. In the event, on 26 November 2012, the Court of Appeal allowed the appeal of the CPS against the order dated 30 May 2012: Gohil v Gohil [2012] EWCA Civ 1550, [2013] Fam 276. The court concluded that the decision in the BOC case was wrong and that it was not bound by it. It also concluded that the fact that material obtained under the 2003 Act had been adduced in open court in a criminal trial did not render it admissible in proceedings not identified in the requests. The result was that Moylan J had relied upon evidence from the criminal trials which was inadmissible insofar as it reflected material obtained under the 2003 Act. While rightly noting the inadmissibility of some of the evidence on which Moylan J relied, the Court of Appeal, in setting his order aside, was not in a position to distinguish evidence from the criminal trials which was admissible from that which was inadmissible. Were it necessary for this court to direct that the wifes application be reheard, such would be a task for the trial judge. Jurisdiction of the High Court to set aside The first ground of the husbands appeal to the Court of Appeal was that, as a judge of the High Court, Moylan J had no jurisdiction to set aside an order made in the High Court. The husband relied in particular on section 17 of the Senior Courts Act 1981 (the 1981 Act) which provides: (1) Where any cause or matter, or any issue in any cause or matter, has been tried in the High Court, any application for a new trial thereof, or to set aside a verdict, finding or judgment therein, shall be heard and determined by the Court of Appeal, except where rules of court made in pursuance of subsection (2) provide otherwise. Subsection (2) permits rules of court to provide otherwise where no error of the court at the trial is alleged but, as McFarlane LJ pointed out, the only rule ever made pursuant to the subsection did not extend to an application to set aside a financial order. As the argument before the Court of Appeal unfolded, however, the husbands jurisdictional objection to the order of Moylan J seems not to have been pressed. Perhaps the husband had no appetite for a result which might consign the wifes application to substantive consideration elsewhere. There is high authority although its consonance with section 17(1) of the 1981 Act seems never to have been established that the issue by the wife of a fresh action to set the order aside would have conferred the necessary jurisdiction on a judge of the High Court: de Lasala v de Lasala [1980] AC 546, 561. In the present case the Court of Appeal seems to have deemed the wifes application in the divorce proceedings to have been a fresh action and, on that basis, it turned to address the other grounds of the husbands appeal. It follows that no issue about the jurisdiction of Moylan J to have set aside the order dated 30 April 2004 is raised before this court. But the Family Procedure Rule Committee (the committee) is currently considering how best to formulate a clear procedure for those who aspire to set aside financial orders made by courts at every level. In those circumstances it may therefore be helpful for this court to make the following observations: (a) The Court of Appeal has itself long recognised that it is an inappropriate forum for inquiry into disputed issues of non disclosure raised in proceedings for the setting aside of a financial order: Robinson v Robinson (Practice Note) [1982] 1 WLR 786, 786, and Judge v Judge [2008] EWCA Civ 1458, [2009] 1 FLR 1287, para 48. Indeed its observations to that effect in the Robinson case were quoted with approval by Lord Brandon of Oakbrook in Livesey (formerly Jenkins) v Jenkins [1985] AC 424, 442. The Court of Appeal is not designed to address a factual issue other than one which has been ventilated in a lower court. (b) That the Court of Appeal is an inappropriate forum is clearly demonstrated by the present case: there is no way in which it would have devoted its resources to the conduct of an intensive eight day fact finding hearing, upon controversial evidence given by live witnesses and contained in a mass of documents, such as was conducted by Moylan J. (c) There is therefore need for definitive confirmation, whether by a rule made pursuant to section 17(2) of the 1981 Act or otherwise, of the jurisdiction of the High Court to set aside a financial order made in that court. A substantive order will bring the existence of ordinary civil proceedings to an end and will therefore require any attempt to set it aside to be made within a fresh action. But the same effect has never been attributed to a financial order made in divorce proceedings; so there is no need to provide that the jurisdiction of the High Court to set aside its financial orders be invoked by a fresh action, rather than by application within those proceedings. It is nowadays rare, however, for a financial order to be made in the High Court: it is normally made in the family court and, when made there by a High Court judge, he or she sits in that court as a judge of High Court level. It seems highly convenient that an application to set aside a financial order of the family court on the ground of non disclosure should, again, be made to that court and indeed at the level at which the order was made; and this convenient solution seems already to have been achieved by the provision of the Matrimonial and Family Proceedings Act 1984 recently inserted as section 31F(6), under which the family court has power to rescind any order made by it. (d) The minutes of the meeting of the committee on 20 April 2015 have been placed before this court. The committees conclusion, which in my view this court should indorse, is that its Setting Aside Working Party should proceed on the basis that: (i) there is power for the High Court and the family court to set aside its own orders where no error of the court is alleged and for rules to prescribe a procedure; (ii) financial remedy only; (iii) ; the rule should be limited so as to apply to all types of (iv) applications to set aside should be made to the level of judge (including magistrates) that made the original order; and (v) if an application to set aside can be made, any application for permission to appeal be refused. Recital 14 The husband argued unsuccessfully before Moylan J that recital 14 to the order dated 30 April 2004 disabled the wife from making any complaint about non disclosure on his part. The husband seems scarcely to have pressed the argument in the Court of Appeal and it did not figure in McFarlane LJs judgment; but, apparently emboldened by the recent decision of the Court of Appeal in Hayward v Zurich Insurance Co PLC [2015] EWCA Civ 327, the husband revives the argument in case the Court of Appeals decision in the present case needs extra defence. It is obvious that recital 14 to the order dated 30 April 2004 was inserted at the request of the husband, albeit that the wife agreed to it. Such recitals to financial orders made by consent in divorce proceedings are not common; but nor are they unknown. Those advising a husband in negotiating a settlement with a wife openly sceptical about the comprehensiveness of his financial disclosure occasionally appear to consider that such a recital has some protective effect for him against any later attempt to reopen it on the ground of his non disclosure. Are they correct? In the Hayward case the claimant alleged that his accident at work had led to specified injuries of a long term character. In their defence the employers, by their insurers, pleaded that the claimant had exaggerated his injuries and that he was guilty of lack of candour. His claim was thereupon settled in the sum of 135k. Five years later the insurers, who had received fresh evidence of the claimants full recovery prior to the settlement, sought to reclaim most of the award in an action for deceit. The Court of Appeal held that it could not do so. In the light of its pleaded assertions that the claimants presentation of his injuries had been dishonest, the insurers could not be said to have relied on his presentation when entering into the settlement. So said Underhill LJ at para 23; and at para 25 he concluded that parties who settle claims with their eyes wide open should not be entitled to revive them only because better evidence comes along later. This court has recently granted permission to the insurers to appeal against the Court of Appeals decision. In my view the reasoning of the Court of Appeal in the Hayward case, even if it were to be upheld by this court in the circumstances of that case, does not apply to a case in which the dishonesty takes the form of a spouses deliberate non disclosure of resources in financial proceedings following divorce. For the spouse has a duty to the court to make full and frank disclosure of his resources (see the Livesey case cited in para 18(a) above at p 437), without which the court is disabled from discharging its duty under section 25(2) of the Matrimonial Causes Act 1973 and any order, by consent or otherwise, which it makes in such circumstances is to that extent flawed. One spouse cannot exonerate the other from complying with his or her duty to the court. No doubt on 30 April 2004 Baron J closely scrutinised the order which she was invited to make; and scrutinised also the content of the undertakings which she was invited to accept, in the knowledge that on a later occasion she might be invited to enforce them. But what the parties found convenient to record as agreed recitals to the order was of little interest to Baron J. In the present context, namely that of a financial order in divorce proceedings, a form of words such as recital 14 has no legal effect. Ladd v Marshall In the Ladd case, cited in para 1 above, the claimant sued the defendant for repayment of 1,000. The claim turned on whether he had paid 1,000 to the defendant in the first place. The claimant called the defendants wife but she said that she recalled no such payment. The claim was dismissed. In his appeal the claimant sought to adduce further evidence or to secure a direction for a new trial at which he could adduce it. The proposed fresh evidence was to be given by the defendants wife, who intended to say that she had lied at the trial and that she had been present when the claimant had paid 1,000 to her husband. The Court of Appeal refused to receive the further evidence and dismissed the appeal. Denning LJ said at p 1491 that fresh evidence would be received, or a new trial directed, only when, first, the evidence could not have been obtained with reasonable diligence for use at the trial; second, the evidence would probably have an important influence on the result of the case; and, third, it was presumably to be believed, ie was apparently credible. The court held that the evidence of the defendants wife, who was proposing to confess to having lied, did not satisfy the third criterion. In his judgment Moylan J recorded the husbands concession, by his then counsel, that the court had jurisdiction to set aside the order dated 30 April 2004 on the basis either that material non disclosure has been proved or by application of the principles set out in Ladd v Marshall. The judge proceeded to analyse the wifes case separately on each basis and he upheld it by reference to each. On any view it was unfortunate that Moylan J accepted counsels concession uncritically. As the Court of Appeal held, the decision in the Ladd case does not propound criteria for what needs to be proved, whether in an application to set aside a financial order or otherwise. Its criteria are evidential: other legal principles will identify the facts which a claimant needs to prove and the criteria propounded in the Ladd case do no more than to identify the material upon which, in one unusual situation, litigants can rely in seeking to prove or to dispute the facts which the claimant needs to prove. The unusual situation is that in which, following a trial in which they will each have had the opportunity to adduce evidence in accordance with all general rules of evidence, one of the litigants seeks to adduce further evidence in the course of an appeal. It is thus clear that Moylan J fell into error in holding that, since she had adduced evidence which satisfied the criteria propounded in the Ladd case, the wife was entitled to have the order dated 30 April 2004 set aside. Separately, however, the judge conducted the correct exercise and held that it yielded the same conclusion. The correct exercise was that mandated by the decision in the Livesey case, to which Moylan J referred. In this separate section of his judgment Moylan J recognised that the wife needed to establish material non disclosure on the part of the husband. Notwithstanding suggestions to the contrary by the Court of Appeal (for which, with respect, I perceive little or no foundation), it is clear that over the eight days Moylan J did conduct a full fact finding hearing and did find as a fact, no doubt on the balance of probabilities, that the husband had been guilty of non disclosure. He also found as to which there could be no live dispute that the non disclosure was material in the sense in which Lord Brandon used the word in the Livesey case at p 438 and explained it at p 445, and indeed as further elucidated in para 44 of Lord Neubergers judgment below and in para 33 of the judgment given by Lady Hale today in the Sharland case. I now turn to the crux of the wifes appeal. For, having correctly held that the use made by Moylan J of the decision in the Ladd case had been misconceived, the Court of Appeal held that it was appropriate to apply the decision in a different way. For it accepted the husbands submission not only that the wife had needed to establish that he had been guilty of material non disclosure within the meaning of the Livesey case but also that the evidence which it had been open to her to adduce before Moylan J in that respect had been limited to evidence which satisfied the criteria propounded in the Ladd case. The husbands argument to this effect had first surfaced at a hearing for directions in the wifes application before Baron J on 3 April 2008. Although a transcript of her judgment is not to hand, it is clear from her order that Baron J rejected it. In his appeal against the order of Moylan J the husband revived the argument. The report of his counsels oral argument, [2015] Fam 89, 92, correctly replicates counsels written argument that [i]f jurisdiction to set aside does exist [in a High Court judge], the Ladd v Marshall principles should be applied to the question of whether any particular fresh evidence should be admitted. In paras 39 and 40 of his judgment McFarlane LJ recited counsels general argument to that effect; in para 41 he noted that counsel had, by way of example, directed his argument to the evidence given on behalf of the wife by the husbands father on the basis that, with reasonable diligence, she could have obtained it in 2004, with the result that it was inadmissible; and in para 72 he expressed his entire agreement with the argument of counsel as set out in those paragraphs. Of course, in appraising the evidence on which Moylan J relied in finding material non disclosure on the part of the husband, it was necessary for the Court of Appeal to strip out such evidence from the criminal trials as had been obtained under the 2003 Act. In the event, as explained in para 15 above, it stripped out all the evidence from the criminal trials since it was not practicable for that court to have done otherwise. But what of the other evidence on which Moylan J relied? The evidence of the husbands father was expressly held to have been inadmissible on the basis that it did not satisfy the criteria propounded in the Ladd case. But all the other evidence relied on by Moylan J seems to have been considered inadmissible on that same basis. Following appropriate hesitation and intensive study of the judgment of McFarlane LJ, I draw that inference from his thrice asserted conclusion that it was not open to Moylan J to have made a finding of material non disclosure. Such was a conclusion about the admissibility of the evidence rather than about its weight. Indeed, had McFarlane LJ disagreed with Moylan J about the weight to be attached to particular evidence, he would have been the first to acknowledge the advantage which, in having heard the application over eight days and listened to the oral evidence, Moylan J enjoyed over the Court of Appeal. The absence of any such acknowledgment confirms the conclusion that Moylan Js order was reversed on grounds of the inadmissibility of the evidence on which he had relied. The purported justification for this entirely novel inhibition on the ability of some spouses to establish a ground for the setting aside of a financial order appears to be this: (a) one avenue open to this wife would have been to seek to appeal out of time to the Court of Appeal against the order dated 30 April 2004; (b) had she so proceeded, that court would have applied the criteria propounded in the Ladd case to any evidence which she wished to adduce in support of her appeal; and (c) by choosing instead to apply to the High Court for the order to be set aside, the wife should not be able to bypass the evidential restrictions which would have confronted her in the Court of Appeal. Evidently the Court of Appeal accepted this argument. In doing so it was in my view guilty of a rare aberration for the following reasons: (a) The Court of Appeal would not have embarked on the disputed fact finding exercise required by the wifes application: see para 18(b) above. So the rules for adducing fresh evidence before that court are irrelevant. (b) The first criterion propounded in the Ladd case, namely that the evidence could not have been obtained with reasonable diligence for use at the trial, presupposes that there has already been a trial. It severely curtails a litigants enjoyment of a second opportunity to adduce evidence. It is misconceived to apply it to the evidence adduced by the wife at the hearing before Moylan J, which was only her first opportunity to do so. (c) The argument would not apply to an application to set aside a financial order made by a district judge, against which no appeal out of time would lie to the Court of Appeal in any event. But why should the level of the court which made the order precipitate different evidential rules? (d) Overarchingly, the argument loses sight of the basis of an application to set aside a financial order for non disclosure. It is that the respondent failed to discharge his duty to make full and frank disclosure. The Court of Appeal held that it was open to the wife in the present case not to have consented to the order on 30 April 2004; instead to have proceeded to a substantive hearing of her financial claims; and, if reasonably diligent, there to have adduced the evidence of the husbands resources which she adduced before Moylan J in 2012. But at that hypothetical hearing the onus would not have been on her to adduce evidence of the husbands resources. The onus would have remained on him. Answer The answer to the question in para 1 above is that the principles propounded in the Ladd case have no relevance to the determination of an application to set aside a financial order on the ground of fraudulent non disclosure. Consequence The Court of Appeal not only set aside the order dated 25 September 2012 by which Moylan J granted the wifes application to set aside the order dated 30 April 2004. It also dismissed her application. In the light of its erroneous approach to the admissibility of so it appears all the evidence which she adduced, its dismissal of her application cannot stand. But what further orders should this court make? The complication is that some of the evidence on which Moylan J relied was indeed inadmissible by virtue of section 9(2) of the 2003 Act. Has this court therefore no option but to uphold the setting aside of his order and to direct that the wifes application be reheard? Or might it nevertheless reinstate the order of Moylan J, with the result that the wifes claim for further capital provision may at once, and at last, proceed? The reinstatement of the order dated 25 September 2012 would not be justified by a conclusion that, by reference only to the evidence admissible before him, Moylan J might properly have found that the husband had been guilty of material non disclosure in 2004. It would be justified only by a conclusion that Moylan J would properly have so found. If he would properly have so found, his decision itself, as opposed to some of his reasoning, would not have been wrong within the meaning of rule 52.11(3)(a) of the CPR and the Court of Appeal should not have set his order aside. Nor would a direction for a rehearing in those circumstances be consonant with one aspect of the overriding objective of the CPR identified in rule 1.1(2)(e), namely that the court (including the Court of Appeal) should allot to the wifes application only an appropriate share of the resources of the Family Division in the light of its need to allot resources to other cases. I will summarise the clearly admissible evidence before Moylan J under three headings. I will also refer to his appraisal of it and ask whether, as the husband suggests, the appraisal can realistically be taken to have been contaminated by the attention which the judge paid to the evidence which was inadmissible by virtue of the 2003 Act. The husbands father The evidence of the husbands father (the father) was not only admissible. It was highly significant. (a) The father said that, although a flat in a suburb of Mumbai known as Bhayander, which had been purchased in 1994, had at the husbands request been placed in his, the fathers, name, the husband had provided the purchase price. In the presentation of his resources on 30 April 2004 the husband had alleged that he had no interest in the flat in Bhayander. (b) The father said that, although a flat in Ashoka, Mumbai, which had been purchased in 1999, had at the husbands request also been placed in his, the fathers, name, the husband had provided the purchase price by paying a Mr Saldhana who had paid the builders. The father admitted that he had later sold the flat and kept the proceeds. In the presentation of his resources on 30 April 2004 the husband had alleged that he had never had an interest in the flat in Ashoka and that he had no interest in the proceeds of its sale. (c) The father said that prior to 2001 the husband had purchased a car with funds taken from the Sunfor Trust. The evidence on 30 April 2004 suggested that the Sunfor Trust owned an offshore company, Sunfor Commercial Inc, which was the registered owner of a property in Sydney Street, Chelsea. But the husband had at that time alleged that he had no interest in the trust. (d) The father referred to the husbands purchase of a new Mercedes SL Convertible in 1998 for about 43,000. In the presentation of his resources on 30 April 2004 the husband had alleged that the father had paid for the vehicle. But in his evidence to Moylan J the father denied that he had paid for any part of it. (e) By letter sent to the wife soon after he had sworn his affidavit, the father referred to a BMW 300 motor car which, so he said, the husband had registered in his, the fathers, name without his knowledge. Upon its sale in 1999 the price of 15,700 had therefore been payable to him, the father, and had been paid into his bank account in Orpington. With the letter to the wife, the father enclosed a copy of the letter which he had then sent to the bank in Orpington. He alleged that it was in the husbands handwriting and that he, the father, had done no more than to sign it. The letter instructed the bank to transfer 15,700 to an account in Mauritius for the benefit of Hempton International Ltd (Hempton). In the presentation of his resources on 30 April 2004 the husband had alleged that he had never had an interest in Hempton. (f) To his affidavit the father exhibited a statement dated 5 April 1997 relating to an account in the name of himself and his wife (the mother) with Banque Indosuez, Gibraltar. He averred that he had not opened the account and, until he had been shown the statement, he had known nothing about the account. (g) The father referred to an account in the name of Odessa Management Ltd (Odessa) with Bank Schroder, Geneva. The ownership of Odessa had been in issue in the proceedings which concluded on 30 April 2004. The husband had then alleged that he held a one third interest in Odessa and that the father and the mother each also held a one third interest. But in his evidence to Moylan J the father averred that he had never paid funds into Odessa and had no interest in it; and that his signature on a document dated 8 July 1996, by which he appeared to declare to the bank that he was one of its three beneficial owners, had been forged. If true, these seven aspects of the fathers evidence manifestly established large scale material non disclosure on the part of the husband on 30 April 2004. In that Moylan J attached substantial importance to the evidence later held to have been inadmissible by virtue of the 2003 Act, he no doubt considered that it was unnecessary for him to recite the fathers evidence in the detail in which I have recited it in para 36 above. Nevertheless he specifically referred to each of the seven aspects of it apart from that to which I have referred at (d). Moylan J noted that, other than to admit the allegation at (e) and to aver that the transfer to Hempton was by way of repayment of a debt, the husband had denied the fathers allegations and he recorded his counsels submission that the estrangement between the husband and the father should lead him to afford little, if any, weight to the allegations. The judge concluded however that the fathers evidence was apparently credible. In one ground of his decision the judge, as noted in para 24 above, wrongly applied the criteria propounded in the Ladd case and his description of the fathers evidence reflects the third criterion, namely that the evidence should be apparently credible. The judge concluded, by contrast, that aspects of the evidence of the husband to which he had earlier referred were to put it mildly, unconvincing and inconsistent. The husbands contention before this court is that the judges preference for the evidence of the father rather than for the evidence of himself may partly have been induced by a low opinion of his general credibility derived from the inadmissible evidence. Moylan J was of course well aware that a person who has been dishonest in relation to one matter may well be telling the truth in relation to another matter; and the terms of his judgment well demonstrate the discharge of his duty to survey the factual disputes between the father and the husband on their merits. Insofar, however, as Moylan J took into account that the husband had been guilty of dishonesty in other respects, such was a perception likely to have been derived from something quite other than the inadmissible evidence. It was far more likely to have been derived from the fact that in 2010 the husband had been found guilty of five offences of money laundering under the 2002 Act, committed in and after 2005, and that he had then pleaded guilty to a further eight analogous offences, for all of which he had been sentenced to terms of imprisonment totalling ten years. Transactions in Odessa Moylan J stated that the evidence to which he attributed the greatest weight was not only the evidence much of which was later held to have been inadmissible but also the evidence in relation to the US dollar and sterling accounts held by Odessa with Bank Schroder. The latter evidence was, in summary, that: (a) on 25 May 2007 the husband stated, in answer to a questionnaire, that the accounts were almost depleted, retained only balances to cover guarantees for credit cards and were about to be closed; and (b) on 3 July 2007 his solicitors stated that the accounts had been closed; but (c) on 9 July 2007 40,000 was paid into the sterling account; and (d) on 18 July 2007 $90,000 was paid into, and then out of, the dollar account; and (e) by November 2007 the sterling account held about 79,000. Moylan J stated that the husband had been unable to explain the inconsistency between (a) and (b), on the one hand, and (c), (d) and (e), on the other. The funds identified at (c), (d) and (e) were, said the judge, relatively modest, although no doubt he did not, in this respect, forget the modesty of the capital provision agreed to be made for the wife on 30 April 2004. The judge found, however, that the husbands drawings from his solicitors partnership, said by the husband to have been only 18,000 in 2004 and only 13,000 in 2005 and again in 2006, had been manifestly insufficient to generate these funds and that the husband had been unable credibly to explain their source. The judge proceeded to infer, in my view legitimately, that, had the husband been willing truthfully to explain their source, the trail would be likely to have led to the discovery of other assets which ought to have been disclosed in 2004. Purchase of further flats In support of his conclusion Moylan J also referred to the purchase of two adjoining flats in Mumbai in 2006 or 2007, with which, on any view, the husband had been associated. The judge noted a variety of inconsistencies in the husbands explanations of the source of the purchase price in his written reply to a questionnaire, in the course of a hearing for directions before Baron J, in his written response to her ensuing order and in his oral evidence before Moylan J himself. The husbands explanations, so the judge concluded, were entirely lacking in credibility. Adverse inferences The husband argues that if, from the evidence in relation to the funds held by Odessa and to the purchase of the further, adjoining, flats in Mumbai, there was any ground for inferring that in 2006 and 2007 he held undisclosed assets, there remained no ground for inferring that he held them in 2004. In the light of his conviction for offences committed no earlier than 2005, any such assets, so his argument runs, were clearly the product of his criminal activities. On examination the argument is as unsound as at first sight it is unattractive. For it fails to allow for the role of adverse inferences in the courts generation of its factual conclusions. In Prest v Petrodel Resources Ltd [2013] UKSC 34, [2013] 2 AC 415, Lord Sumption quoted at para 44 the following statement of Lord Lowry in R v Inland Revenue Comrs, Ex p TC Coombs & Co [1991] 2 AC 283, 300: In our legal system generally, the silence of one party in face of the other partys evidence may convert that evidence into proof in relation to matters which are, or are likely to be, within the knowledge of the silent party and about which that party could be expected to give evidence. Lord Sumption added at para 45 that judges exercising family jurisdiction are entitled to draw on their experience and to take notice of the inherent probabilities when deciding what an uncommunicative husband is likely to be concealing. The husband was well aware that the inquiry conducted by Moylan J was into the extent of his assets on 30 April 2004. It is clear that he held assets in 2006 and 2007 and he must have been aware of their origin. Had he demonstrated that they originated in or after 2005, they would have been irrelevant to the inquiry. Instead, however, he chose to obfuscate about their origin. In those circumstances it was reasonable for Moylan J to infer that a truthful explanation of their origin would have been probative of the existence of undisclosed assets on 30 April 2004 and that the husbands withholding of it should be no less probative. Conclusion I conclude that, even if he had referred only to the evidence admissible before him, Moylan J would still properly have found the husband to have been guilty of material non disclosure in 2004; that his order dated 25 September 2012 should therefore be reinstated; and that the wifes claim for further capital provision should therefore proceed before him. It is unclear whether her claim will succeed and, if so, to what extent. Moylan J will need to decide, no doubt with the assistance of the CPS, how best to synchronise his conduct of her application with the confiscation proceedings pending against the husband in the Crown Court; and he will need to investigate not only the extent of the husbands current assets but the extent to which they represent the proceeds of his crimes. For, although the court has jurisdiction to order a transfer to the wife of property so tainted, it will ordinarily, as a matter of public policy, decline to exercise its jurisdiction to do so (CPS v Richards [2006] EWCA Civ 849, [2006] 2 FLR 1220, para 26) and in the present case the wife has made clear that she will not ask it to do so. In its submissions to Moylan J the CPS informed him of its allegation in the confiscation proceedings, disputed by the husband, that he had realisable assets of almost 35m. With respect the Court of Appeal was wrong to say that, to the extent that they existed, the husbands realisable assets would necessarily represent the proceeds of crime; but some or indeed all of them may well do so and Moylan J faces an unenviable task in keeping the scale of his inquiry within tight bounds. LORD NEUBERGER: (with whom Lord Clarke, Lord Sumption and Lord Reed agree) I agree with the judgment of Lord Wilson. The only issue on which I have entertained doubts is whether this court could properly reinstate the order made by Moylan J setting aside the consent order of 30 April 2004 (the 2004 order), rather than directing a rehearing of the wifes application to set aside the 2004 order. For the following reasons, I have concluded that we properly can do so. The ultimate question in these proceedings is whether the 2004 order should be set aside, and that turns on whether the husband had been guilty of material non disclosure in the proceedings leading up to the hearing at which the 2004 order was made. If there had been such non disclosure, but it had been accidental or negligent, the wife would also have had to establish that the effect of the non disclosure was such that the 2004 order was substantially different from the order which would have been made (or agreed) if the husband had afforded proper disclosure see per Lord Brandon in Livesey v Jenkins [1985] AC 424, 445. However, as the non disclosure alleged by the wife in this case is said to be intentional, then, if there was such non disclosure, the 2004 order should be set aside, unless the husband could satisfy the court that the 2004 order would have been agreed and made in any event see per Lady Hale in Sharland v Sharland [2015] UKSC 60, paras 29 33. In other words, where a partys non disclosure was inadvertent, there is no presumption that it was material and the onus is on the other party to show that proper disclosure would, on the balance of probabilities, have led to a different order; whereas where a partys non disclosure was intentional, it is deemed to be material, so that it is presumed that proper disclosure would have led to a different order, unless that party can show, on the balance of probabilities, that it would not have done so. After hearing oral evidence from the husband, the wife and the husbands father, and after considering a number of documents put before him, Moylan J decided that the husband had been guilty of intentional non disclosure (and, for good measure, that it would have affected the terms of the order made in 2004), so he set aside the 2004 order. When deciding that there had been non disclosure, Moylan J relied on evidence derived from criminal proceedings which had been brought against the husband, including the Crown Prosecution Services testimony that he had realisable assets of 35m. As that evidence resulted from the Crown Courts request for assistance under section 7 of the Crime (International Co operation) Act 2003, it was in fact inadmissible (although it is only fair to add that Moylan Js conclusion to the contrary was justified at the time that he reached it in the light of the state of the authorities). In the light of this, the question to be faced is whether, as a result of the fact that Moylan J wrongly relied on the inadmissible evidence obtained under the 2003 Act, there will indeed have to be a retrial of the issue or whether Moylan Js decision can nonetheless stand. There is no doubt that Moylan J gave considerable weight to the inadmissible evidence from the criminal proceedings in coming to his conclusion that the husband had failed to disclose his assets in 2004. In justifying the statement in para 91 of his judgment that there is clearly credible evidence that the husband's resources, both income and capital, were not limited to those disclosed, Moylan J first and most fully referred, in paras 91 and 92, to the inadmissible evidence from the criminal proceedings. And when reaching his conclusion in para 100 that the husband had failed to make full and frank disclosure of his resources in 2004 and that such failure was material, the Judge said this: I have had regard to the combined effect of all the new evidence. However, the evidence to which I attribute the greatest weight is the evidence from the criminal proceedings and the evidence from the Odessa account statements. This evidence demonstrates that it is extremely unlikely that the husbands resources were limited to those disclosed by him in 2004, in other words, substantial debts and a very modest income. The husband, in my view, is very unlikely suddenly to have accumulated 35m of realisable assets from a negative base in 2004. On the other hand, there was other, undoubtedly admissible, evidence to support Moylan Js conclusion that there had been material non disclosure, and that evidence is very fully set out by Lord Wilson in paras 36 40 of his judgment. Although it is true that the evidence first identified by the Judge to support his conclusion that there had been material non disclosure was the inadmissible evidence from the criminal proceedings (paras 92 93), he relied on other evidence as well. Thus, in paras 93 94 he relied on [i]n addition, evidence as to monies passing through the Odessa account and the purchase of the Raj Classic flats. In paras 97 98, Moylan J also said that he would add that [he] found the [husbands] fathers evidence apparently credible, and that the husbands mothers assertions in her statement are clearly inconsistent with the husbands disclosure. Further in para 99, the Judge said that [o]ther aspects of the husbands evidence were, to put it mildly, unconvincing and inconsistent and support the wifes case that he had other resources available to him. And in para 100, quoted above, he did not refer only to the inadmissible evidence but also to the Odessa account. The issue whether there has been non disclosure is a question of fact which involves an evaluative assessment of the available admissible evidence. Such a question is, of course, common in civil and family litigation, and under our common law system the rule is that it can only be answered by a judge after hearing from live witnesses as well as looking at the documents. The most common exceptions to this rule are (i) cases where the evidence is so clear that there is no need for oral testimony and (ii) cases where neither party wishes, or alternatively is unable, to call any witnesses. Ignoring cases in the second category (which has no application here), attempts to seek summary judgment in relation to such disputed issues often fail even when the evidence appears very strong, because experience shows that a full investigation at a trial with witnesses occasionally undermines what appears pretty clearly to be the truth when relying on the documents alone: see eg per Sir Terence Etherton C in Allied Fort Insurance Services Ltd v Creation Consumer Finance Ltd [2015] EWCA Civ 841, paras 81, 89 and 90 and the cases which he cites. Accordingly, in practice it is only when the documentary evidence is effectively unanswerable that summary judgment can be justified. There is also a principled reason behind this rule, namely that, at least where there is a bona fide dispute of fact on which oral testimony is available, a party is normally entitled to a trial where he and his witnesses can give evidence, and he can test the reliability of the other party and/or her witnesses by cross examination. (I say normally, because, in exceptional cases, there may be reasons, such as a sanction in the form of a debarring order, for not following the rule.) The issue in this appeal is unusual, although by no means unprecedented, in that there has been a full trial with witnesses who have given oral evidence which has been tested by cross examination. However, the husband effectively relies on the rule to justify his contention that there should be a full re hearing of the non disclosure issue. He argues that, once one strips out the inadmissible evidence from the criminal proceedings, the decision of Moylan J clearly cannot stand, and that therefore one is in the same position as if there had been no trial with witnesses. In my view, there are obvious and important differences between a case where a party seeks summary judgment (ie where she applies for judgment on the documents and witness statements or affidavits, before any hearing has occurred) and a case such as the present, where a party is arguing that she should be entitled to maintain a judicial decision after a full hearing, even though the judge took into account inadmissible evidence. In the former case the rule would be abrogated whereas in the latter case it would not. Thus, in this case, the husband has had the benefit of a full hearing, which, it is worth mentioning lasted around eight days. He has called all the oral evidence he wanted, and was able to subject the testimony of the wife and her witnesses to cross examination. Accordingly, while it is vital to recognise his right to a fair trial (which includes a right not to have any issues determined by reference to inadmissible evidence), it must be acknowledged that the husband has had a full trial perhaps one may say, not entirely flippantly, too full a trial. Further, in a case such as this, where all the oral evidence which the parties wish to put before the court has been adduced and cross examined, an appellate court is in a much stronger position to reach a confident and concluded view on the facts than it would be in an appeal against an ordinary grant of summary judgment (as in Allied Fort). The appellate court knows what the parties and their witnesses would say in the witness box as they have said it. So, in this case, we can be informed about all the admissible oral evidence which the husband wanted to put before the court, including the results of any cross examination of the wifes witnesses. It is clearly open to an appellate court to make findings of fact in such circumstances, given that the trial judge could or should have done so: see CPR 52.10(1) (whereby the Court of Appeal has all the powers of the lower court), and rule 29(1) of the Supreme Court Rules 2009 2009/1603 (whereby the Supreme Court has all the powers of the court below). It is also germane to bear in mind the overriding objective in CPR 1.1, which includes requirements that courts deal with cases at proportionate cost, sav[e] expense, ensur[e] that [a case] is dealt with expeditiously, and allot to it an appropriate share of the courts resources. These factors justify a much greater reluctance on the part of an appellate court to order a rehearing in a case such as this (particularly when one bears in mind that the hearing before Moylan J lasted around eight days) than would be justified when considering whether to direct a hearing rather than award a party summary judgment. All these factors make it quite clear that, on this appeal, we should not remit the issue whether there was material non disclosure, provided that it would not involve an unavoidable injustice to the husband not to do so. The qualification is of course vital, so that, if it would be impossible to uphold Moylan Js decision without doing or risking injustice to the husband, then the factors discussed in paras 52 54 above could not prevail, and there would have to be a rehearing. The hurdle which has to be crossed in order to establish that there would be no risk of injustice to the husband can be expressed in more than one way. It could be said that we have to be satisfied that (i) Moylan J would have decided that there had been material non disclosure even if he had not heard or seen the inadmissible evidence obtained under the 2003 Act, or (ii) looking at the totality of the admissible evidence in this court, we can safely conclude for ourselves that there has been material non disclosure, or (iii) if the issue was remitted for a re hearing, the judge could only realistically come to that conclusion in the light of the totality of the admissible evidence. In my view, a party such as the wife on this appeal can succeed provided that the court is satisfied that any one of the three requirements is satisfied, although it will, I suspect, be a rare case where only one (or even two) of those requirements is (or are) satisfied: it is particularly hard to imagine circumstances where requirements (ii) and (iii) would not march together. There is in my judgment, great force in the argument that, for the reasons given by Lord Wilson in paras 36 40, we should be satisfied that there was material non disclosure and that, if the issue was remitted any judge, properly directed, would so hold ie that requirements (ii) and (iii) in para 56 above are satisfied. I would be more comfortable about reaching that conclusion if we had been provided with the transcripts of the evidence before Moylan J. That would normally be the appropriate course where an appellate court is being asked to decide for itself a question of fact which was in issue before a judge who heard relevant oral evidence. However, we have been provided with around 500 pages of documents (including applications, submissions, answers to questionnaires, letters, affidavits, and a forensic accountants report), as well as the Judges full analysis of the evidence. Furthermore, it has not been suggested that the husband has been unable to put before this court any of the testimony given to Moylan J which he wishes us to see, or that there is any relevant material in the oral evidence which was not apparent from the judgment. Accordingly, albeit with some hesitation, I am prepared to accept that requirements (ii) and (iii) are satisfied. I also have concerns about requirement (i), namely whether Moylan J would have reached the conclusion that he did if he had not been able to take account of the inadmissible evidence, in the light of the way in which he expressed himself as set out in paras 47 48 above. However, I have concluded that requirement (i) is also satisfied. Even if one strips out the reference to the inadmissible evidence obtained under the 2003 Act, Moylan J still said in para 100 that he attached the greatest weight to the evidence from the Odessa account statements, and there was the other very significant evidence which he set out in paras 93 94 and 97 98 and which is summarised in para 48 above. In addition to the positive evidence referred to in those passages (and more fully explained by Lord Wilson), there is the important point that in para 99, the Judge found aspects of the husbands evidence to put it mildly, unconvincing and inconsistent and that they support[ed] the wifes case that he had other resources available to him. In other words, the only positive oral testimony in favour of the husbands case was unconvincing and inconsistent and actually supported the case for saying that there had been material non disclosure. Accordingly, while the wife need only satisfy one of the three requirements identified in para 56 above, I am persuaded that this is an example of what I suspect would usually be the case, namely that the three requirements march together, and in this case I consider that they are all satisfied. For these reasons, I have reached the conclusion that this court can, and therefore should, decide that Moylan Js decision that the 2004 order was obtained by material non disclosure and should be set aside, can stand notwithstanding that, in reaching that conclusion, he relied in part on the inadmissible evidence obtained under the 2003 Act.

The appellant ("the wife") used to be married to the respondent ("the husband"), a former solicitor. In 2002, the wife petitioned for a divorce. In response to her financial claims, the husband asserted that all of his ostensible wealth represented assets held on behalf of his clients [4 6]. In 2004, the wife's claims were settled at a Financial Dispute Resolution (FDR) meeting. The settlement order (the 2004 Order) provided that the husband should make a lump sum payment in final settlement of the wife's capital claims (which was eventually paid), and periodical annual payments (which the husband stopped paying in 2008). The 2004 Order included a recital that "the [wife] believes that the [husband] has not provided full and frank disclosure of his financial circumstances (although this is disputed by the [husband]), but is compromising her claims in the terms set out in this consent order despite this in order to achieve finality" (the Recital) [7 9]. In 2007, the wife applied by notice issued within the divorce proceedings to set aside the 2004 Order on the ground that the husband had fraudulently failed to disclose his assets. These proceedings were delayed, largely because in 2008 the husband was charged with serious money laundering offences dating from mid 2005. He was eventually convicted and committed to prison in 2011, and confiscation proceedings against him are ongoing [10 11]. In September 2012, after an eight day hearing, Moylan J set aside the 2004 Order [12 14]. His decision was made on the basis both that (a) there had been material non disclosure by the husband when the 2004 Order was made and, had he made full disclosure, the outcome would have been different, and (b) because the wifes evidence satisfied the criteria in Ladd v Marshall (which govern when fresh evidence may be adduced on appeal) it followed that her application should be allowed [24 25]. The Court of Appeal allowed the husbands appeal. It held that Moylan J had incorrectly applied the Ladd criteria and was wrong to allow the wifes application on that basis [24]. However, it held that the Ladd criteria were relevant in order to establish what evidence the wife could adduce in order to establish material non disclosure by the husband. Applying those criteria to the evidence before Moylan J, and discounting other inadmissible evidence, the Court of Appeal concluded that there was no admissible evidence to support Moylan Js conclusions on material non disclosure [26 29]. The Supreme Court unanimously allows Mrs Gohils appeal and reinstates Moylan Js order. Lord Wilson (with whom Lord Neuberger, Lady Hale, Lord Clarke, Lord Sumption, Lord Reed and Lord Hodge agree) gives the leading judgment. Lord Neuberger gives a short concurring judgment. The husband had suggested that, as a judge of the High Court, Moylan J did not have jurisdiction to set aside an order of the High Court. This argument was not pursued in the Court of Appeal, but the Supreme Court makes the following observations: (a) the Court of Appeal has long recognised that it is an inappropriate forum for inquiries into non disclosure issues raised in proceedings for the setting aside of a financial order; (b) this is shown by the present case, where an intensive fact finding hearing was necessary; (c) there is an urgent need for definitive confirmation of the High Courts jurisdiction to set aside a financial order made in that court; (d) the Supreme Court endorses the conclusion of the Family Procedure Rule Committee in relation to its Setting Aside Working Party, set out in the minutes of its meeting on 20 April 2015 [16 18]. The Recital Words such as those used in the Recital have no legal effect in a financial order in divorce proceedings. The husband owed a duty to the court to make full and frank disclosure of his resources, without which the court would be disabled from discharging its duty under section 25(2) of the Matrimonial Causes Act 1973. One spouse cannot exonerate the other from complying with this duty [19 22]. Criteria in Ladd v Marshall The Ladd criteria have no relevance to the determination of an application to set aside a financial order on grounds of fraudulent non disclosure [32]. The Court of Appeal was wrong to accept an argument that the criteria should apply to determine what evidence could be adduced because: (a) the Court of Appeal would not have conducted the necessary fact finding exercise, so the criteria for determining the admissibility of evidence in that court were irrelevant; (b) the first Ladd criterion presupposes that there has been a trial whereas, in this case, the wifes first opportunity to adduce the evidence was at the hearing before Moylan J; (c) the argument would not apply to an application to set aside a financial order made by a district judge and the evidential criteria should not depend on the level of court, and (d) the argument ignores the fact that, had the wifes claims proceeded to trial in 2004, the duty would have lain on the husband, not on her, to explain his resources [31]. In light of the erroneous approach to the admissibility of the wifes evidence, the dismissal of her set aside application cannot stand [33]. Consequences To decide whether Moylan Js order could be reinstated, it was necessary to consider what admissible evidence was before him and ask whether he would properly have found that the husband had been guilty of material non disclosure in 2004 [33 35]. Through no fault of his own, Moylan J had relied on evidence from the husbands criminal proceedings obtained from sources outside the UK (which had since been held inadmissible and had been discounted by the Court of Appeal) [13 15, 33]. However, even if Moylan J had referred only to the remaining admissible evidence [36 40], he would, in the light of his findings on it, still have concluded that the husband was guilty of material non disclosure [42]. Lord Neuberger agrees that Moylan Js order can be reinstated. Several factors make it clear that the material non disclosure issue should not be remitted, provided that there is no risk of injustice to the husband [49 55]. The court has to be satisfied that: (a) Moylan J would have decided that there had been material non disclosure even if he had not received the inadmissible evidence; or (b) looking at the totality of the admissible evidence, it could safely be concluded that there had been material non disclosure; or (c) if the issue was remitted, the judge could only realistically come to that conclusion in light of the totality of the admissible evidence [56 57]. For the reasons given by Lord Wilson, all three of these requirements were satisfied [58 61].

8k-16k

Allegations that a bribe was paid to procure a contract are by no means unknown in international business disputes heard by the Commercial Court in London. Allegations that evidence was procured by torture are thankfully rare. In this case allegations of both bribery and torture were made. A claim under a guarantee of a contract to charter a vessel was met with a defence that the contract was procured by bribery, with the consequence that the guarantee was therefore unenforceable. The allegation of bribery was founded on evidence of confessions made by the individuals who had allegedly paid and received the bribe. The claimant in turn alleged that the confessions were obtained by torture and for that reason were inadmissible as evidence in legal proceedings. The relevant events all took place in the Peoples Republic of China (the PRC) and the judge was faced with a difficult task of having to assess the truth of the allegations on the basis of limited evidence. In particular, no one with first hand knowledge of the alleged bribery or torture gave evidence and the documentation available at the trial was substantially incomplete. The judge concluded that torture could not be ruled out as a reason for the confessions and that in any case the allegations of bribery had not been proved. He therefore found that the contract was enforceable and awarded damages to the claimant. The Court of Appeal allowed an appeal from that decision and remitted the case for redetermination. They did so on the grounds that the judge failed to ask and answer the correct legal question as to what weight should be accorded to the confession evidence and, in those circumstances, fell into legal error in failing to take all the appropriate matters into account and failing to exclude irrelevant matters in considering whether the alleged bribe was paid. Those irrelevant matters included, in the Court of Appeals view, the judges finding that torture could not be ruled out as a reason for the confessions. The Court of Appeal decided that, as a matter of law, if an allegation that a statement was made as a result of torture has not been proved on the balance of probabilities, a court when estimating the weight to be given to the statement as hearsay evidence in civil proceedings must entirely disregard the possibility that the statement was obtained by torture, even if on the evidence given at trial the court considers this to be a serious possibility which it cannot rule out. In this judgment we explain our reasons for concluding that the Court of Appeal was wrong to interfere with the factual findings made by the trial judge in this case and was also wrong in its approach to the question whether evidence had been obtained by torture. On the latter question we explain why, as matter of principle and authority, the judges finding that torture could not be ruled out as a reason for confessions of bribery was a factor that he was entitled to take into consideration in deciding whether the confessions were reliable evidence that bribery had in fact occurred. Factual background The contract in dispute is a charterparty concluded on 6 August 2008 between the appellant, Shagang Shipping Company Ltd (Shagang), as disponent owner and Grand China Shipping Company Ltd (Grand China) as charterer. Under the charterparty Grand China agreed to charter from Shagang a capesize bulk carrier, then under construction, for a period of 82 to 86 months to run from when the vessel was delivered in 2010. A few months earlier, Shagang had itself chartered the vessel from head owners, Dong A Tanker Corporation, on similar terms save for the rate of hire. Grand China was a new company. Its ultimate parent company was the respondent, HNA Group Company Ltd (HNA), which guaranteed the performance of Grand Chinas obligations under the charterparty. The guarantee, also dated 6 August 2008, is governed by English law and provides that any dispute arising from it is subject to the exclusive jurisdiction of the English courts. Shagang, Grand China and HNA are all companies based in the PRC. Shagang, which is now in liquidation, is based in Hong Kong, as is Grand China (also now in liquidation). HNA is based in Haikou, which is the capital of Hainan province. In August 2008 the relevant chartering market was at its height. It was an active market in which owners (including disponent owners like Shagang) held the dominant bargaining position. The rates of hire for the vessel agreed in the charterparty were in line with the market. The vessel, named Dong A Astrea, was delivered to Grand China in April 2010. By that time market rates were very considerably lower than in August 2008, the financial crisis in the autumn of 2008 having changed things dramatically. From September 2010 onwards, Grand China defaulted in making payments of hire under the charterparty. Shagang commenced arbitration proceedings against Grand China and obtained a series of interim final awards for unpaid hire. Some payments were made by Grand China but it remained in arrears, and on 17 January 2012 Shagang In the meantime, on 13 September 2012 Shagang commenced the present terminated the charterparty on the basis of Grand Chinas default in paying hire and consequent repudiatory breach of the charterparty. The claim for unpaid hire was settled in May 2012 but Shagang pursued its claim in arbitration for damages for the loss caused by Grand Chinas repudiatory breach of the charterparty. On 1 November 2012 the arbitral tribunal issued a partial final award for damages in a sum of US$58,375,709. On 8 April 2013 Grand China was wound up in Hong Kong. action in the Commercial Court against HNA under its guarantee. The PSB investigation and allegations of bribery HNA filed its defence to Shagangs claim on 4 November 2013, initially without making any allegation of bribery. On 23 June 2014, however, HNA amended its defence to allege that the charterparty had been procured by the payment of bribes by or on behalf of Shagang to senior employees of Grand China. In support of this allegation, HNA relied on confessions made during an investigation undertaken by the Chinese Public Security Bureau (the PSB). At the time when the charterparty was concluded in August 2008, Mr Jia Hongxiang (Mr Jia H) was a general manager within HNA and the chief executive officer of Grand China. On 11 November 2013, Mr Jia H was detained by the Haikou PSB on suspicion of embezzlement. On 29 November 2013, Mr Jia Hs son, Mr Jia Tingsheng (Mr Jia T), was detained on bribery charges. Mr Jia T was not employed directly by either Grand China or HNA but was employed by an associate company, GCS Development Company. Mr Jia T knew from college Mr Xu Wenzhong (Mr Xu) who in August 2008 had been employed by Shagang. Both men lived in Shanghai. On 22 January 2014, Mr Xu was detained by officers of the Haikou PSB on the charge of bribing a non public servant. He was flown to Haikou (over a thousand miles away), where he was questioned by PSB officers from the Meilan district branch overnight and during 23 January 2014. According to the PSBs interrogation record, Mr Xu gave an account of being asked by the general manager of Shagang, Mr Shen Wenfu (Mr Shen), to use his relationship with Mr Jia T to cause Mr Jia Ts father, Mr Jia H, to charter the vessel from Shagang as soon as possible. Mr Xu is recorded as saying that Mr Shen gave him RMB 100,000 (equivalent to around US$16,000 at that time) in cash, which Mr Xu delivered to Mr Jia T at Mr Jia Ts home in a single instalment. The interrogation record states that Mr Xu was willing to confess his crime for leniency. Also on 23 January 2014, Mr Jia T was questioned by the same PSB officers who had interrogated Mr Xu. The only interrogation record disclosed is described as the 4th. It records Mr Jia T as saying that Mr Xu gave him RMB 150,000 in the hope that Mr Jia Ts father would communicate with HNA to arrange the guarantee as quickly as possible. The money was said to have been handed over by Mr Xu in cash in the cafeteria of a hotel near Mr Jia Ts home. When Mr Jia T told his father about this payment, Mr Jia H said that he could only communicate with HNA according to the companys normal rules and told Mr Jia T to send the money back. Mr Jia T did not do so and, shortly after the charterparty was concluded, met Mr Xu again at a restaurant near Mr Xus house where he received another RMB 150,000. He did not tell his father about this payment. The interrogation record states that Mr Jia T was asked whether his confession had been extorted by torture or deceit, to which he replied no. A confession note dated 24 January 2014 in Mr Xus name gives a similar account to that given in Mr Jia Ts 4th interrogation record. It describes Mr Xu paying Mr Jia T a sum of RMB 300,000 in two instalments, one before and one after the signing of the charterparty. Another interrogation record dated 4 March 2014 refers to Mr Xu being asked why he had initially stated that he had bribed Mr Jia T with RMB 100,000, when he was now saying that the amount was RMB 300,000. He answered that in his initial confession he had lied and deliberately given a lower amount because he was trying to escape punishment. However: Being educated by the police officers, I realised the mistakes I made. Now, I am willing to truthfully confess, for leniency. Mr Xu was also asked why he and Mr Shen would want to bribe HNA if, as he had told the PSB, the pricing of the charterparty was reasonable in any event. Mr Xu is recorded as answering that it would otherwise have been difficult to charter the vessel quickly. Mr Shen was also detained on bribery charges and on 16 February 2014 was questioned by the PSB. According to the PSBs interrogation record, Mr Shen said that he had given Mr Xu RMB 300,000 in two instalments to pay Mr Jia T. The money was said to have been provided at Mr Xus request to make sure that HNA would provide a guarantee of Grand Chinas performance of the charterparty. The same account is contained in an undated confession note. On 17 February 2014, the PSB sent a letter to HNA summarising the confessions made by the individuals accused of bribery. This letter was sent in response to a request made by HNA on 10 February 2014 for information about the criminal investigation to enable HNA to explain and prove the facts in the English court proceedings. Allegations of torture and Mr Xus guilty plea On 1 May 2014 Mr Zhang Jie (Mr Zhang), who had by then replaced Mr Shen as the general manager of Shagang, made a formal complaint to the Peoples Procuratorate (the entity that has supervisory responsibility for the PSB) of Haikou. The complaint alleged that the confessions of Mr Xu and Mr Shen had been procured by torture and that HNA had wrongly used the PSB to manufacture false charges with a view to interfering in an economic dispute. Mr Zhang requested the Procuratorate urgently to investigate these allegations. On 23 June 2014, the Procuratorate made a report on the outcome of its investigation into this complaint. The report stated that the Procuratorate had visited the [PSB], interviewed the concerned suspects, [and] retrieved from the detention centre relevant materials. It concluded that the allegations made in the complaint were not supported by the facts. (Copies of the complaint and report were not available at the trial and were admitted as new evidence in the Court of Appeal.) On 23 July 2014 Mr Xu (who in the meantime had been under a form of house arrest at a hotel in Hainan province) was arrested for bribery of a non public servant and transferred to a detention centre in Haikou. On 21 August 2014 he was visited and interviewed at the detention centre by Mr Guo, a lawyer retained by his wife. Mr Guos interview notes record that Mr Xu maintained that he was innocent and gave the following account of his interrogations: I was brought to Hainan on 23 January this year [2014], Initially there werent any charges. I was taken to the basement of the [PSB]. It was around 11pm and I was definitely there for over 48 hours. I came out on the afternoon of the 26 [January]. The least serious methods used against me were fists and truncheons. I was stripped of my clothes and cold air was blown on me. They covered my mouth with their hands after water was poured into me. I was also burnt with a cigarette butt. At first I said that there had been no such thing [bribery], but then they tortured me and I couldnt take it any longer. On the morning of 24 [January], I said I had paid out 100,000 yuan. I made this up. On the afternoon of 24 [January] they tortured me again and poured water into me. I couldnt bear it any more. They told me it had been 300,000 and it had been paid in two batches 150,000 each time. In the end, I had no other way out but to say what I was told to say . I definitely never did it. At that time, the market was dominated by shipowners and we didnt have to ask any favours of [Grand China]. They had to ask help from us. Their company was a new company and we were an established company. Despite what Mr Xu had told Mr Guo in this interview, on 22 August 2014 Mr Guo made an application for bail on behalf of Mr Xu on the basis that Mr Xu had given a true account in his confessions and had repented. Bail was refused. On 15 September 2014, in a further interview, Mr Xu gave Mr Guo a detailed account of all his interrogations by the PSB and of the visit by the Procuratorate in June. As well as describing how he had allegedly been tortured by the PSB, Mr Xu said that, before he was interrogated again on 24 January 2014, he had heard Mr Jia T screaming from another room. He also said that he was later told that Mr Shen had confessed and was taken to see Mr Shen. He said that Mr Shens whole face was red and it was obvious that he had had water poured into him. On 14 November 2014 Shagang amended its reply in the Commercial Court proceedings to plead an allegation that the confessions of bribery relied upon by HNA in its defence had been obtained by torture, with the consequence that they were inadmissible as evidence in the proceedings. In response, on 3 December 2014, HNA wrote to the Haikou PSB accusing Mr Xu, his wife, Mr Zhang, Mr Guo and two solicitors acting for Shagang in the Commercial Court proceedings of crimes involving interference with the PSBs investigation and fabricating evidence. HNA asked the PSB to handle the case legally and punish the criminals severely so as to realise the fairness and justice of our society and maintain judicial authority. On 17 and 19 December 2014, Mr Xu was visited by two lawyers from Mr Guos firm. According to their notes of these meetings, Mr Xu said that he had been interrogated again on two consecutive days at the end of November. At first he had not admitted to bribery but he was told that, if he admitted the offence, the sentence would be two years at most; otherwise he would be imprisoned for much longer. Mr Xu was recorded as telling the lawyers that he had already been detained for almost a year and that, in order to get out as soon as possible, he had decided to repeat the fabricated account of events he had previously given to the PSB officers. He said that he had then given a video recorded interview in which he repeated that account. The case against Mr Xu came before the Meilan District Peoples Court of Haikou City in Hainan province on 22 September 2015. Before the hearing Mr Xu instructed Mr Guo that he wanted to admit the allegations against him in order to be released sooner. In his submissions Mr Guo relied on Mr Xu having made a voluntary confession in asking the court for leniency. Mr Xu was sentenced on 16 November 2015 to a term of imprisonment of one year and eight months. With credit given for the time he had already spent in detention, this led to his release the following month. No prosecution was brought against Mr Shen or Mr Jia H. In late 2015 Mr Guo met Mr Jia Hs lawyer, who gave him a copy of an unsigned document said to have come from Mr Jia Ts wife. The document is entitled Report on torture suffered by [Mr Jia T] during the period detained in Hainan. This report contains a detailed account written in the first person of three interrogations of Mr Jia T, in each of which torture was allegedly used: the first, lasting 46 hours, from 29 November to 1 December 2013; the second, lasting 24 hours, on 19 and 20 December 2013; and the third, lasting 42 hours, on 23 and 24 January 2014. The torture alleged to have occurred during the last of these interrogations, in which the confession recorded in the 4th interrogation record was made, included: sleep deprivation; putting a cover over Mr Jia Ts head so that it was difficult to breathe and then pouring wasabi oil on his head near his mouth and nose as he lay on his back so that he was forced to inhale it; and covering his face with a sweater soaked in iced water until he could hardly breathe, then loosening the sweater as water was poured into his nose (a procedure said to have been continued over a period of around four hours). The report also contains the following passage, which occurs at the point in the narrative in the early hours of 24 January 2014 after the alleged torture had ended and just before the confession that Mr Jia T had given was written down: [The PSB team leader] came in and said: Actually, you do not know to what stage this situation has developed. Shagang recently wound up Grand China, and took over USD20m, now they are preparing to wind up our HNA. We are undoubtedly not interested in you people as individuals, our HNA Group just wants to solve a problem. So really it is no big deal, you need not worry, just co operate and write down a confession, and strive to return home for Chinese New Year. After you go home do not ever recant your confession or you know what the consequence will be. The trial The trial of Shagangs claim against HNA in the Commercial Court took place over ten days between 26 January and 9 February 2016 before Robin Knowles J. By the time of the trial it was agreed that, unless HNA succeeded in its defence that the charterparty was procured by bribery, Shagang was entitled to judgment on its claim under the guarantee in a sum of US$68,641,712. Only three witnesses gave oral evidence at the trial. They were Mr Guo and Mr Zhang for Shagang and the general manager of HNAs audit and legal affairs department, Mr Wu. None of the witnesses had first hand knowledge of the alleged bribery or torture, although (as mentioned) Mr Guo had interviewed Mr Xu and represented him in the criminal proceedings against him. Each party also relied at the trial on expert evidence of Chinese criminal law and procedure and of experience of confession evidence in China. Neither party sought to cross examine the others experts but each party provided (at the judges request) a list of key propositions to be derived from this evidence. The expert evidence showed that, in a high proportion of criminal cases in the PRC (as many as 95% according to Shagangs expert), the suspect confesses, and also that it is the almost invariable practice of the PSB to interrogate suspects and obtain their confessions on multiple occasions. It is normal for suspects to plead guilty and innocent verdicts are very rare. Torture is illegal in the PRC and legislative reforms of criminal procedure were introduced in 2012 with the aim of giving greater protections to suspects and seeking to eradicate a perceived problem of the use of torture to coerce confessions. However, there have continued to be reported instances of torture being used. The experts were also agreed that it is by no means unknown for local PSBs to interfere in commercial disputes in favour of locally powerful economic interests, although over the years the Chinese authorities have issued various promulgations seeking to clamp down on this practice. The judgment of the trial judge In his judgment given on 16 May 2016, the judge noted that there was little first hand oral evidence available at the trial. None of Mr Xu, Mr Jia T, Mr Jia H or Mr Shen was available to give evidence. Nor was there any evidence from any officer of the PSB. The judge declined to draw any adverse inference against Shagang from the absence of Mr Xu, Mr Xus wife (who had made a witness statement) and Mr Shen. He noted that Shagang was now in liquidation and found that Shagang could not realistically be expected to procure their presence at trial. With regard to the witnesses who gave oral evidence, the judge commented unfavourably on the evidence of Mr Wu, finding that he chose to attempt to avoid giving straightforward answers. In relation to Mr Guo, the judge said that, whilst he was able to accept substantial parts of his evidence, there were other parts that he found unconvincing. He observed that it was to Mr Guos credit that he was prepared to attend the trial and said that there was nothing in the suggestion that he was looking to help Shagang. The judge also said that he did not doubt the essential accuracy of the notes made by Mr Guo of his interviews with Mr Xu. The judge found that the expert evidence relating to Chinese criminal law and procedure, and experience in China of confession evidence, was valuable context or background evidence. The documentation available was found by the judge to be substantially incomplete. He rejected the suggestion that Shagang had deliberately withheld or deleted documents. The judge said that the evidence available was limited in many respects when compared with the evidence that would be desirable for conclusions on the issues in this case, observing at para 85 that: many of the documents require caution before reliance can be put on what they appear to say. The evidence of those few factual witnesses the court has seen has its shortcomings. Accounts of the same key people (Mr Xu in particular) are used both to support and to deny the case of bribery, and both to support and to deny the case of torture. Accounts are altogether missing from other key people. The judge summarised the evidence under the following headings: Commercial Context (paras 18 22); Approval of the Charterparty within Grand China and HNA (paras 23 24); Confession by Mr Xu (paras 25 44); Confession by Mr Jia T (paras 45 50); Confession by Mr Shen (paras 51 55); Mr Jia H (paras 56 57); the Sun bribe (paras 58 62); and Confession evidence and torture (paras 63 82). (The Sun bribe was a separate allegation of bribery made by HNA against a broker, which HNA accepted did not give it a defence and which the judge found was not relevant to Shagangs claim.) The judge then proceeded straight to his conclusions. Under the heading Conclusions on bribery he found at para 87 that: On the limited evidence at this trial, and after careful consideration, on the balance of probabilities I find that there was no bribe by Mr Xu. At paras 88 93 he set out his principal reasons for reaching that conclusion. Because criticisms made of the judges reasoning are at the centre of this appeal, we quote these paragraphs in full: 88. I fully acknowledge that the Meilan District Peoples Court of Haikou City found Mr Xu guilty of bribery and sentenced him. On the material put before that Court I can entirely follow its finding. However, material has been put before this Court that was not put before the Meilan District Peoples Court. In particular, the Meilan District Peoples Court had evidence of Mr Xu (and others) admitting the alleged bribery, but did not have the evidence of his (and their) also denying the alleged bribery. 89. When Mr Xu, Mr Jia T and Mr Shen each first referred to a bribe they did so without a lawyer or representative present. Although it appears Mr Guo was not his first lawyer, when Mr Xu had access to Mr Guo as his lawyer Mr Xu denied that there was a bribe. 90. There is no evidence that any account of the officers of PSB who were present at any interrogation has been tested with them in China. I appreciate the practical difficulties, but there has been no opportunity to test an account from them at this trial. 91. The reason given for the alleged bribing concluding the charterparty quickly rather than the pricing of the charterparty is unconvincing, in my judgment. Even if there was a desire for a quick conclusion I am unpersuaded, on the evidence, that bribes were introduced to achieve that end. On the documents, Mr Xu at one point suggested it as a reason for bribing. The same appears to be the case for Mr Shen. But both have also denied any such bribe. Further, the state of the market was not such as to provide an objective reason for a quick conclusion being so important, or being other than achievable in ordinary course in any event. The relevant chartering market was active and an owners market. As for the facts that the charter period would commence in 2010 and be of some length, it is hard to accept these would have made a difference: Shagang itself had recently agreed a charterparty for the Vessel of identical commencement and duration to the Charterparty. 92. Even when Mr Jia T gave an account consistent with receiving a bribe, that account supported the fact that Mr Jia Hs response was to insist on normal procedures. I do not overlook HNAs point that a requirement for board approval was lifted and the charterparty was not submitted for a required legal and financial review, but in the result the charterparty was approved by, among others, a main board director of HNA, and by the Chairman of HNA. I do not overlook Mr Wus own evidence that he did not become aware of the charterparty until 2011, but in the next several years following the agreement of the charterparty in 2008 I do not see anyone at HNA bringing out the point that the charterparty was agreed too quickly so as to cause suspicion of bribery. 93. Further, I have seen no records to show withdrawal of funds used for the alleged bribe or expenditure of funds by Mr Jia T. At para 94 the judge observed that the reasons I have given would alone cause me to reach the conclusion that there was no bribe. He then addressed various contrary arguments advanced by HNA as follows: I am not led to a different conclusion by the fact that Mr Xu pleaded guilty at trial, when I consider that plea in context. Further my conclusion is not disturbed by Mr Xus admission of accepting a watch as a bribe in connection with an unrelated matter. 95. I have considered carefully a challenge by HNA to the reliability of Mr Xus apparent accounts by reference to the dates and times, and sequence of events, in January 2014, including by comparison with the Jia T report. I do not find these points affect the substance of the matter, and I would have been surprised not to find some possible discrepancies in the circumstances that obtained. 96. HNA argues that an unequivocal confession is sufficient to convict an accused even on the criminal standard of proof. But the question in the present case is not whether a confession by an accused may lead to a conviction of that accused. In these proceedings HNA relies on the alleged confessions against Shagang and not against the individuals said to have made them. [Counsel for HNA] refers to R v Tippet (1823) Russ & Ry 509 and R v Sykes (1913) 8 Cr App 233 at 236 but those were cases where confessions were relied upon against the individuals said to have made them. 97. HNA argues that, in the absence of torture, there is no credible reason why Mr Xu, Mr Jia T and Mr Shen should falsely confess to crimes which they did not commit. However, the possibility of a large difference between the sentence that might follow an admission and the sentence that might follow a conviction was referenced expressly by Mr Xu in his exchanges with Mr Guo, and on his account reflected what had been indicated to him by officers of the PSB. 98. HNA argues that the prospect of a lighter sentence cannot be a reason for a false confession. I do not accept that argument. In the following section the judge set out his conclusions on torture: 101. But what of the allegations of torture? I have considered the evidence available at this trial for and against the allegations of torture, and the limitations of that evidence, including the absence emphasised by HNA of medical evidence. Having done so, I find that torture cannot be ruled out as a reason for the confessions. 102. The fact that I cannot rule out torture further reduces the confidence that I can put in the confessions, although it will be apparent from my conclusions on bribery (above) that I already have insufficient confidence in the confessions to allow a finding of bribery. 103. HNA distinguishes the confessions from later admissions (including in bail applications) and pleas of guilty, at which later points torture is not alleged to have been practised. But in the present case the matters are interconnected. Once the confessions had been made, a departure from them, in the form of a denial or a not guilty plea, would likely require reference back to the torture allegations. 104. In the present case, in the circumstances of my conclusion that there was no bribe, it is not necessary to express a definitive conclusion on whether there was torture. I have said that I cannot rule it out; the evidence available does not equip me well to reach a firmer conclusion. 105. That I should so confine my view at this trial is also in the interests of leaving proper room for investigation in China by the appropriate authorities, to include questioning of the officers who were on duty. I have not set out in this judgment the full extent and nature of the torture alleged to have occurred, but if the allegations were all true it would be hard to imagine a more comprehensive breach of the duties and responsibilities of the officers. In the light of his conclusions, the judge found that HNA was liable to pay damages to Shagang and judgment was entered in the agreed principal sum of US$ 68,597,049.59. The judge refused permission to appeal to the Court of Appeal, as did Davis LJ when he considered HNAs application for permission on the papers. Permission to appeal was granted by Longmore LJ, however, following an oral hearing. On the appeal HNA contended that the judges conclusion on bribery was unsustainable and that, having accepted that the confession evidence was admissible, the judge should have held that the charterparty was procured by bribery. The Court of Appeals judgment For reasons given in a joint judgment dated 23 July 2018 [2018] EWCA Civ 1732, the Court of Appeal (Sir Geoffrey Vos, Chancellor of the High Court, Newey LJ and Dame Elizabeth Gloster DBE) allowed the appeal. The Court of Appeal recognised that it was concerned with an appeal on questions of fact but observed that there was no appeal against the findings of primary fact made by the judge. The challenge made was to the manner in which the judge reasoned and his conclusion, drawn from his unchallenged findings of primary fact, that there was no bribe (para 53). In these circumstances, it was common ground that the proper approach to the appeal was that set out in Clarke LJs judgment in Assicurazioni Generali SpA v Arab Insurance Group (Practice Note) [2002] EWCA Civ 1642; [2003] 1 WLR 577, as approved by the House of Lords in Datec Electronics Holdings Ltd v United Parcels Service Ltd [2007] UKHL 23; [2007] 1 WLR 1325, and that the relevant questions were whether the judge made an error of law in reaching his ultimate conclusion and/or whether it was a conclusion that no reasonable judge could have reached (para 53). The Court of Appeals answer to those questions was that the judges decision was unsustainable for reasons summarised in para 79 as follows: The judge did not follow the logical steps necessary to reach a proper evaluation of the admissible evidence. He failed to ask and answer the correct legal question as to what weight should be accorded to the admissions evidence. The judge ought to have said why he was unable to place any reliance on the admissions, if that was his view. The judge also fell into legal error in failing to take all the appropriate matters into account in deciding the crucial bribery issue. As we have also said, the judge failed to exclude irrelevant matters (including his lingering doubt as to whether the admissions were procured by torture) in considering whether the alleged bribe was paid. The Court of Appeal decided that the case should be sent back for reconsideration of the issue of the weight to be attached to the admissions and of the issue of bribery in the light of this judgment, and on the basis that the issue of torture has already been decided (para 88). It directed that these issues be determined by a different Commercial Court judge. This appeal As encapsulated in para 79 of its judgment (quoted above), the Court of Appeal made four main criticisms of the judges reasoning: The judge failed to follow the logical steps necessary to reach a proper i) evaluation of the admissible evidence. ii) The judge failed to ask and answer the correct legal question as to what weight should be accorded to the confession evidence. iii) The judge fell into legal error in failing to take all the appropriate matters into account in deciding the bribery issue. iv) The judge fell into legal error in failing to exclude irrelevant matters, including what the Court of Appeal described as his lingering doubt as to whether the confessions were procured by torture, in considering whether the alleged bribe was paid. The central issue on this further appeal is whether these criticisms were justified and, to the extent that they were, whether they warranted overturning the judges decision and remitting the case for a fresh determination. If the Court of Appeal was right to remit the case, a further question arises as to whether the basis on which it did so was appropriate. Although not all aspects of these issues were covered by Shagangs original grounds of appeal, they are fully covered by the statement of issues agreed between the parties and by the parties written cases. To answer an objection raised by HNA that some of the arguments advanced by Shagang fall outside the scope of the original grounds, Shagang has applied for permission to amend its grounds of appeal to add a ground, in similar terms to the first agreed issue, that there was no basis in law for the Court of Appeal to interfere with the judges conclusions in light of the facts found by the judge (which are not in themselves challenged by either party). We would grant this application, as the amendment ensures that all the important points in dispute are properly before the court and causes no prejudice to HNA. It is convenient to consider each of the four key criticisms of the judges reasoning made by the Court of Appeal in turn. (i) Alleged failure to address issues in the logical order The Court of Appeal considered that the judge approached the issues in the wrong order and that he ought to have decided the issue of torture first. As stated at para 63: In our view, the judge ought to have decided the issue of torture first. It was the sole basis on which the admissibility of the admissions was resisted. All the other arguments went only to the weight that should be accorded to them. Thus, the judges first task was to decide on the facts whether or not torture had taken place in order to extract each of the three main admissions (leaving aside Mr Jia H) relied upon by HNA. Once he had done that exercise, the judge should have stated his conclusion that, since torture had not been proved, the admissions were admissible as evidence of their contents. In the view of the Court of Appeal, having decided that the confession evidence was admissible, the judge should next have determined the weight to be given to that hearsay evidence, having regard in particular to the considerations set out in section 4(2) of the Civil Evidence Act 1995. Only then should the judge have moved on to decide whether there had been bribery. The Court of Appeal summarised at para 65 the approach which it said should have been taken: In our judgment, therefore, the proper approach in a case of this kind is to decide first whether torture is proved. If it is not proved, as in this case, the statements are admitted as hearsay evidence. The next step is to decide the weight that can be attached to that evidence in all the circumstances, including those in section 4 of the 1995 Act. Only then could the court properly move on to an evaluation of all the evidence, including the hearsay statements of admission, in order to decide the primary factual issue in the case, which was whether the alleged bribery occurred. We can quite see that the second and third stages of the process might be undertaken together, but it must be clear that both have actually been considered. We fully accept that, where there is an issue as to whether important hearsay evidence is admissible, it is a logical approach to decide that issue first before going on, if the evidence is held to be admissible, to consider its weight and its evidential impact on the substantive issues to be determined. We do not, however, accept that such an approach is mandatory, either generally or in this particular case. How and in what order questions concerning the admissibility and weight of evidence are dealt with is very much a matter for the trial judge. There is no one size fits all approach. The judge will consider how best to deal with such matters in the light of the issues, the evidence and the arguments in the case as a whole. There will usually, if not invariably, be more than one legitimate approach which can be taken. In many cases, for example, issues of admissibility can be dealt with efficiently by admitting the evidence de bene esse. This means taking the evidence into account on the assumption, without deciding, that the evidence is admissible. Unless the evidence turns out to be critical to the decision to be reached, the issue of admissibility may never need to be determined. This is often a convenient approach to adopt, as resolving issues of admissibility can be complex and time consuming. Mr Brown for HNA realistically accepts that it would have been a permissible approach in this case. To make his reasoning clear the judge ought to have stated at the start of his conclusions on bribery that this was what he was doing. Nevertheless, when his conclusions are read as a whole, it is apparent that this is in fact the approach which the judge took. The judge was clearly aware that the issue of torture was a sensitive one and that any findings that he made about whether torture had occurred might have ramifications beyond the confines of the case, as he indicated at para 105 of his judgment. In these circumstances, it is understandable that he should have preferred not to determine that issue unless it was necessary to do so. This explains why he proceeded, as he manifestly did, by treating the confession evidence as admissible before coming to the issue of torture. If, as was the case, he reached the conclusion that notwithstanding the confession evidence there was no bribery, then the question whether that evidence was inadmissible because obtained by torture did not have to be decided. This also explains why the judge did not find in terms whether there was or was not torture, but instead left the matter open. Thus, he stated in para 101 that: I find that torture cannot be ruled out as a reason for the confessions. Similarly, in para 104 he stated that: it is not necessary to express a definitive conclusion on whether there was torture. I have said that I cannot rule it out. At para 105 he gave reasons why he considered that he should so confine my view. The Court of Appeal considered that, since the judge treated the confessions as admissible, he must have held that torture had not been proved on the balance of probabilities. We disagree. In our judgment, it is clear that the judge deliberately refrained from deciding that question. He considered that he did not need to decide it because he was in any event satisfied that there was no bribery. It is common for judges not to make findings on particular issues where to do so is unnecessary for the disposal of the case. As Davis LJ stated in refusing permission to appeal on the papers, in circumstances where the judge had decided that there was no bribery notwithstanding the confession evidence: there was no further requirement for the judge to make an express finding of whether or not there was also torture. He clearly had doubts on the matter; but he in terms stated that it was not necessary to reach a conclusion. We also note that the judges approach was consistent with the way in which Shagang put its case at trial. Its primary case was that, even taking the confession evidence at face value, it did not support HNAs pleaded case since it did not demonstrate the requisite inducement. Its secondary case was that such evidence was internally inconsistent, made no sense in the commercial context, and provided no or no sufficient basis for a finding of bribery. Its tertiary case was that if, contrary to both these arguments, the evidence did support a prima facie case of bribery, then it should be ruled inadmissible as having been procured by torture. In all the circumstances we do not consider the Court of Appeals criticism that the judge made an error by not deciding the issue of torture first to be justified. The approach taken was both legitimate and consistent with the way the case was put before him. We deal under the next heading with the Court of Appeals further criticism that the judge ought to have decided the weight to be given to the confession evidence before moving on to decide the primary factual issue of whether the alleged bribery occurred. (ii) Alleged failure to assess the weight of the confession evidence The Court of Appeal considered that the judge did not adequately address the weight to be given to the confession evidence, stating at para 77 that: he did not really address the point at all. He seems to have omitted that step in the argument. Once he found that the admissions had not been obtained by torture, if he was going to reject them as unreliable, he needed in our judgment to say why he was doing so. The nine factors relied upon by the judge in his conclusions on bribery may be summarised as follows: the confessions had been made without a lawyer present (para 89); the PSB officers present at the interrogations had not given any the fact of the confessions and the guilty plea of Mr Xu (para 88); the fact that all three individuals accused of bribery had retracted their i) ii) admissions and asserted their innocence privately (para 88); iii) iv) account which could be tested (para 90); v) the reason for the bribe given in the confessions, namely the need to conclude the charterparty speedily, was unconvincing, and the bribe made no sense commercially (para 91); vi) there was no evidence that the alleged bribe was ever received by Mr Jia H and the account of Mr Jia T in his confession on which HNA relied was that Mr Jia H had told him to return the bribe and abide by normal procedures (para 92); vii) and the chairman of HNA (para 92); viii) there was no evidence of withdrawal of funds used to pay the bribe or expenditure of those funds by Mr Jia T (para 93); and ix) confessions (paras 97 98). It is correct that the judge did not address the question of what weight should be given to the confession evidence as a separate step in his reasoning before going on to decide whether the alleged bribery had occurred. He did not refer to section 4 of the 1995 Act or to any of the considerations there set out. It is also fair to say that the charterparty was approved by an unconnected HNA board director the prospect of leniency was a credible reason for making false the judge stated his conclusions in what may be described as thumbnail terms without any detailed discussion of the evidence underlying them. It would have been much more satisfactory if he had dealt in more detail with the content of the confessions, the circumstances in which the confessions were made and other factors bearing directly on their reliability, such as the evidence that each of the individuals had told others their confessions were false, before bringing into consideration other factors bearing on the likelihood or otherwise that the confessions were truthful, such as the lack of any plausible commercial reason for paying a bribe. We do not accept, however, that the judge failed to address the question of what weight should be given to the confession evidence or to say why he rejected it as unreliable. The confession evidence was the first matter to which he referred in the reasons given for his conclusion that no bribe was paid. Furthermore, the judges second, third and fourth factors listed above all directly relate to the reliability and weight of that evidence. The third factor is of obvious importance. The right in most circumstances to consult a lawyer before police questioning is well recognised in this jurisdiction and under the European Convention on Human Rights. It is an important safeguard and incriminating evidence obtained without affording that opportunity will generally be inadmissible see section 58 of the Police and Criminal Evidence Act 1984 (PACE); Cadder v HM Advocate (HM Advocate General for Scotland intervening) [2010] UKSC 43; [2010] 1 WLR 2601. The judge was also entitled to attach weight to the fact that none of the PSB officers present at the interrogations had given any account which could be tested (his fourth factor). The Court of Appeal considered that this factor could only have been relevant to the question of whether the confessions were obtained by torture, and not to the question whether the confessions were otherwise reliable evidence of bribery. We disagree. It seems to us that there were many questions that it would have been relevant to ask the PSB officers had there been an opportunity to do so and the fact that such questions were unanswered was relevant, not only to the allegation of torture, but more generally to the reliability of the confession evidence and the weight that should be accorded to it. One obvious area of enquiry is what caused officers of the Haikou PSB to detain Mr Jia T and Mr Xu on bribery charges in the first place and whether they had any information to suggest that a bribe had been paid before Mr Jia T and Mr Xu made their confessions. There was no evidence at the trial that they did. Mr Wu in his testimony accepted that HNA had no evidence that Shagang had bribed anyone in relation to the charterparty when the PSB began its investigation. Nor did HNA ever acquire any such evidence apart from the confessions. None of the interrogation records and other documents relating to the PSB investigation and to the subsequent criminal proceedings against Mr Xu refers to any reason for suspecting Mr Jia T, Mr Xu or Mr Shen of bribery apart from their confessions, or records any question confronting any of them with any reason for suspicion. According to the first interrogation record of Mr Xu, for example, his initial confession came about in the following way. Having been asked about his personal details and background and told that he was under suspicion of bribery, Mr Xu was asked: Question: Do you have any criminal action, please explain? Answer: Yes, I have criminal action of bribery. Question: Please describe in detail your behaviour of bribery. Answer: Sure. In June 2008 [The confession then follows] While there are no doubt cases where individuals confess to crimes including crimes of dishonesty entirely of their own initiative, when there is no evidence to implicate them, such an occurrence raises questions about how the individual had come to be suspected of a criminal action of bribery, whether the interrogation records are complete and whether the suspect was offered any inducement or given any motive to confess. Quite apart from its relevance to the allegation of torture, the judge was entitled to regard the inability to test any account from any officer of the PSB of how the confessions had come about as tending to reduce the reliance he could reasonably place on the confession evidence. It is also important to bear in mind that the question whether the confession evidence was reliable and the question whether bribery had taken place were not merely inter related but, in the circumstances of this case, were simply different ways of framing the same issue. It was not disputed that Mr Xu, Mr Jia T and Mr Shen had made the confessions attributed to them in the interrogation records and that Mr Xu had pleaded guilty to an offence of bribing a non public servant. The issue was whether or not, when they made the confessions, these individuals were telling the truth. Furthermore, the confessions were the only evidence to support the allegation of bribery made by HNA. There was no evidence apart from the confession evidence to suggest that a bribe had been paid. In addressing the issue of bribery, the judge was therefore necessarily engaged in estimating the weight to be given to the confession evidence. It was the only matter to be put into the evidential scale on behalf of HNA. As part of the exercise of evaluating the weight to be given to the confession evidence, it was appropriate for the judge to consider the plausibility of the alleged bribe. The more implausible it was that a bribe had been paid, the less likely the confessions were to be true and therefore the less weight he should give to that evidence. A number of the factors identified by the judge went to the implausibility of any bribe and/or the alleged bribe having been paid, in particular his fifth to eighth factors. In summary, the explanation given for the bribe was unconvincing; bribery made no sense in the commercial context; the charterparty went through normal approval procedures; no one complained about the fixture for a considerable period of time and there were no documents to support the allegation, despite the fact that there had been a criminal investigation. The fact that the confession evidence may have been induced by the prospect of a lenient sentence was also relevant to the weight which it was appropriate to give that evidence the judges ninth factor. As already noted, there was evidence that all three individuals had offers of leniency made to them and of both Mr Xu and Mr Jia T saying: I am willing to truthfully confess, for leniency. In the interrogation record dated 4 March 2014 Mr Xu was recorded as stating: Being educated by the police officers, I fully realised my crimes. I am willing to truthfully confess my problems, for leniency. And I would like to give my appreciation to the Public Security Bureau for its lawful acts and protection of my rights. There was also the striking evidence of Mr Xu deciding, for reasons of leniency, to adhere to his original confession even after he had told his lawyer that it was false. As the judge found at para 38: Mr Xu explained a decision to adhere to his earlier account accepting guilt because it would lead to a much reduced sentence than if he contested the allegations and was found guilty. This evidence fell to be considered against the background evidence that in the region of 95% of criminal cases in China involve a confession, that it is normal for suspects to plead guilty and that Chinese courts very rarely hand down innocent verdicts. The attractions of leniency are clear if allegations are believed to be highly likely to lead to conviction in any event and to much greater punishment if they are denied. Whilst the Court of Appeal recognised that leniency could certainly have been a relevant factor, it pointed out that the judge had not found that the prospect of leniency was in fact a reason for false confessions having been made. It was not, however, necessary for the judge so to find. That it may have been a reason is sufficient for it to be relevant to an assessment of weight. The Court of Appeal also found it difficult to see why someone might make up something which was untrue in order to obtain a more lenient sentence. False confessions are, however, a known problem for criminal justice systems, and are a reason why in this jurisdiction there are important safeguards governing the admission of confession evidence see section 76 of the Police and Criminal Evidence Act 1984 (PACE). Indeed, as Davis LJ observed when refusing permission to appeal, under English law an indication of leniency such as those given in the present case would render the alleged confessions vulnerable under section 76 of PACE 1984 even as against the accused. It is a fortiori with regard to a third party (Shagang). For all these reasons, it is in our judgment clear that the judge did address the question of the weight to be given to the confession evidence. He also answered that question. In circumstances where that evidence was the only evidence of bribery, in finding that there was no bribery the judge was necessarily finding that the confession evidence was of little or no weight, as confirmed by his statement in para 102 that it will be apparent from my conclusions on bribery (above) that I already have insufficient confidence in the confessions to allow a finding of bribery. Moreover, it cannot be said that such a conclusion was unreasonable or unsustainable. There were ample grounds to support it. (iii) Alleged failure to take all appropriate matters into account The principal matters which HNA contended, and the Court of Appeal appears to have considered, that the judge failed to take into account are the details of the confessions made, including such matters as the content of each confession made by each individual, their timing, surrounding circumstances and how they tallied with one another. It is said, in particular, that the judge should have addressed each confession made by each of the three individuals rather than simply dealing with the matter compendiously. We agree that it would have been much more satisfactory for the judge to have addressed the confession evidence in greater detail. It is, however, apparent that those of his factors which went to the circumstances of the confessions (retraction, no lawyer present, no PBS evidence and offers of leniency) applied to all three individuals. His conclusions also have to be read together with the earlier part of his judgment, at paras 25 55, where he dealt in some detail with the confessions made by each individual. In assessing the reliability of the confession evidence, the judge can fairly be taken to have had this detail well in mind. Further, he addressed some issues relating to how the confession evidence tallied together at para 95. He also referred to the importance of the initial confessions, and the difficulty of formally resiling from them once they had been made, at para 103. This is not therefore a case in which it can be said that the judge failed to have any regard to material evidence. He clearly did consider the confession evidence of all three individuals. The real complaint is as to the degree of depth in which he did so and that he did not do so in a sufficiently systematic way. Such a shortcoming, whilst regrettable, does not involve an error of law or otherwise justify intervention by an appellate court. (iv) Whether the possibility of torture was irrelevant As mentioned, when he came to consider the allegations of torture, the judge found that torture cannot be ruled out as a reason for the confessions. He said that this further reduces the confidence that I can put in the confessions (para 102). The possibility that the confessions may have been obtained by torture therefore provided an additional ground for his conclusion that the confession evidence could not be relied on. The most striking criticism of the judges reasoning made by the Court of Appeal is that, in considering whether the alleged bribe was paid, the judge failed to exclude his lingering doubt as to whether the confessions were procured by torture. The Court of Appeal described the possibility of torture as an irrelevant matter (para 79) and considered that the judge ought not to have allowed his doubts about whether torture had occurred to infect his findings on the central issue in the case (para 69). The judge was clearly very troubled by the evidence of torture and, although he did not find it necessary to express a definitive conclusion on the question, his emphasis on his finding that he could not rule out torture as a reason for the confessions made it clear that he considered there to be at least a serious possibility that torture had been used. It is a general principle of the law of evidence that, in assessing what weight (if any) to give to evidence, a court should have regard to any matters from which any inference can reasonably be drawn as to the reliability or otherwise of the evidence. In the case of hearsay evidence in civil proceedings this principle is embodied in section 4 of the Civil Evidence Act 1995. Circumstances specifically listed in section 4(2) to which regard may be had include whether any person involved had any motive to conceal or misrepresent matters. It is difficult to think of a motive which would more seriously undermine the reliability of a confession than a desire to escape intense physical pain and suffering caused by torture. The Court of Appeal nevertheless held that to take account of such a possible motive is an error of law and contrary to the established rules of evidence in civil proceedings. In re B The argument made by HNA which persuaded the Court of Appeal to reach this conclusion was founded on passages in the judgments in In re B (Children) (Care Proceedings: Standard of Proof) (CAFCASS intervening) [2008] UKHL 35; [2009] AC 11, a decision of the House of Lords. Lord Hoffmann said (at para 2): If a legal rule requires a fact to be proved (a fact in issue), a judge or jury must decide whether or not it happened. There is no room for a finding that it might have happened. The law operates a binary system in which the only values are zero and one. The fact either happened or it did not. If the tribunal is left in doubt, the doubt is resolved by a rule that one party or the other carries the burden of proof. If the party who bears the burden of proof fails to discharge it, a value of zero is returned and the fact is treated as not having happened. If he does discharge it, a value of one is returned and the fact is treated as having happened. To similar effect, Baroness Hale observed (at para 32): In our legal system, if a judge finds it more likely than not that something did take place, then it is treated as having taken place. If he finds it more likely than not that it did not take place, then it is treated as not having taken place. He is not allowed to sit on the fence. He has to find for one side or the other. HNA argued and the Court of Appeal accepted that, applying this binary principle, the fact that the judge in the present case did not find that on the balance of probabilities the confessions had been obtained by torture was, in law, a finding that there was no torture (para 60). Hence, in estimating the weight to be attached to the confession evidence, the judge was bound entirely to disregard the possibility that the admissions had been obtained by torture and, to the extent that he took this possibility into account, he made an error of law. As already discussed, the judge expressly said that he had not reached any definitive conclusion on whether there was torture. He did not have to find for one side or the other on that question because he had already concluded that, notwithstanding the confession evidence, no bribe was paid. It was therefore unnecessary for him to decide one way or the other whether torture had occurred and he did not do so. The absence of a finding on that question is not the same as a finding that torture had not been proved on the balance of probabilities. Even if the binary principle operated in this context, therefore, the judge could not be treated as having, in law, made a finding that there was no torture. Nor, as the transcript makes clear, was it common ground that he had done so, as the Court of Appeal appears to have erroneously assumed (see para 3 of its judgment). This is a short answer to HNAs argument. Even if, however, the judge had reached a definite conclusion that the use of torture had not been proved on the balance of probabilities, there would have been no inconsistency between that conclusion and the judges finding that torture was a real possibility which affected the reliance that should be placed on the confessions. It is of course true that, as Lord Hoffmann observed in In re B, if a legal rule requires a fact to be proved, the law operates a binary system. So where it is necessary to prove a fact for the purpose of a rule governing the admissibility of evidence, there are only two possibilities: either the evidence is admissible or it is not, which depends on whether the fact has been proved or not. There is no room for a finding that the fact might have happened. But not all legal rules do require relevant facts to be proved in this binary way. In particular, the rule governing the assessment of the weight to be given to hearsay evidence in civil proceedings does not. It requires the court to have regard to any circumstances from which any inference can reasonably be drawn as to the reliability or otherwise of the evidence: see section 4(1) of the Civil Evidence Act 1995. Such circumstances are not limited to facts which have been proved to the civil standard of proof. HNAs argument depends on an assertion that, if failure to prove a fact to the requisite standard of proof requires a value of zero to be returned for the purpose of a particular legal rule, then that fact must be treated as not having happened for the purpose of other legal rules as well. But there is no logical reason why that should be so. Nor is there anything in In re B (or any other authority cited in these proceedings) which lends that notion any support. What was decided in In re B was that section 31(2)(a) of the Children Act 1989 requires any facts used as the basis of a prediction that a child is likely to suffer significant harm to be proved on the balance of probabilities, and that the assessment of the childs welfare required in care proceedings once the threshold in section 31(2) has been crossed must be conducted on the same factual basis as the determination of whether that threshold has been crossed. Hence, if a particular fact (in that case an allegation of sexual abuse) has not been proved, it must be treated as not having happened for the purposes of both section 31(2) and the assessment of the childs welfare. That is a decision about the meaning and effect of particular provisions of the Children Act. It does not establish any general principle that failure to prove that a fact happened for the purpose of a particular legal rule has the legal consequence that the fact must be treated as not having happened for all other purposes in the litigation. In particular, it provides no support for the proposition that failure to prove that a fact happened for the purpose of determining whether evidence is admissible has the legal consequence that the fact must be treated as not having happened for the purpose of assessing the weight to be given to the evidence, if it is admissible. Facts in issue Some confusion seems to have arisen in the arguments in this case from the use by Lord Hoffmann in the passage quoted above of the expression fact[s] in issue. This phrase commonly and in our view most usefully refers to those facts which as a matter of law it is necessary to prove in order to establish a claim or a defence: see eg Phipson on Evidence, 19th ed (2018), para 7 02; Cross and Tapper on Evidence, 13th ed (2018), p 30. That is how we shall use the expression in this judgment. Thus, for example, in the present case the facts that the charterparty and the guarantee were entered into and that Grand China failed to pay hire in accordance with the terms of the charterparty were all facts in issue which Shagang had to prove in order to establish its claim (until those facts were formally admitted by HNA). The fact that a bribe was paid by an employee of Shagang to an individual connected with HNA was also, and remained throughout the trial, a fact in issue which it was necessary for HNA to prove in order to establish a defence that the charterparty (and therefore its guarantee) was unenforceable by reason of bribery. Indeed, this was the key fact in issue in the case. On the other hand, the fact that torture was used to procure the confessions of Mr Xu, Mr Jia T and Mr Shen was not a fact in issue as we are using the term. There was no claim for relief made by Shagang for which it was legally necessary, in order for the claim to succeed, to prove that torture had been used by the PSB. It was therefore unnecessary for the judge to make any finding as to whether on the balance of probabilities torture had taken place in order to decide the facts in issue in the case. The requirement to discharge the legal burden of proof, which operates in a binary way, applies to facts in issue at a trial, but it does not apply to facts which make a fact in issue more or less probable. Lord Hoffmann was alert to this point in In re B as, immediately after the passage quoted above, he contrasted facts in issue with facts which merely form part of the material from which a fact in issue may be inferred, which need not each be proved to have happened (para 3). So, for example, in the present case (as already discussed) it was not necessary to prove that the prospect of leniency in fact caused the confessions to be made. That it may have done is sufficient to make it relevant to take into account in deciding whether a bribe had been paid. Judges need to take account, as best they can, of uncertainties and degrees of probability and improbability in estimating what weight to give to evidence in reaching their conclusions on whether facts in issue have been proved. It would be a mistake to treat assessments of relevance and weight as operating in a binary, all or nothing way. Preliminary facts In the present case the allegations of torture were relevant in two different ways. One was in assessing the likelihood or otherwise that the confessions were reliable and hence whether it was proved as a fact that a bribe had been paid. The other was in order to determine whether the confession evidence was admissible. Whilst the core purpose for which evidence is admissible in legal proceedings is that of proving or disproving facts in issue at a trial, it is also often necessary for a court to decide factual questions for the purpose of applying procedural and evidential rules. Facts which must be proved for such purposes have been called preliminary facts: see R Pattenden, The proof rules of pre verdict judicial fact finding in criminal trials by jury (2009) 125 LQR 79. The distinction between finding preliminary facts and finding facts in issue is embodied in criminal proceedings by the division of responsibilities between judge and jury. Although in civil proceedings both functions may be performed by the same person, the distinction is conceptually no less important. Examples of preliminary facts which may need to be determined in civil proceedings are: the fact that a communication between a lawyer and client was made in confidence for the purpose of giving or receiving legal advice (in order to decide whether the communication is protected by legal professional privilege); the fact that a person is capable of understanding the nature of an oath and of giving rational testimony (in order to decide whether the person is competent to testify as a witness); and facts which it is necessary to determine for the purpose of deciding whether evidence is admissible. In criminal proceedings where there is a division of function between judge and jury a factual finding made by the judge for a preliminary purpose such as determining whether evidence is admissible is not binding on (nor even generally known to) the jury when it is performing its task of deciding facts in issue in proceedings. So if, for example, the defence alleges that a confession was obtained by an improper threat and the judge finds that the prosecution (on whom the burden of proof lies) has proved beyond reasonable doubt that the confession was not so obtained, evidence of the confession will be admissible; but the jury at the trial will be free to make its own assessment of the facts and to reach a different conclusion on whether the alleged threat was or might have been made. In civil proceedings, at least in cases where both functions are performed by the same decision maker in the course of a single hearing, it seems to us that unlike at a jury trial there is a requirement of consistency in performing these functions. A judge could not rationally reach one factual conclusion for the preliminary purpose of deciding whether evidence is admissible and then, on the same evidence, reach a different factual conclusion for the purpose of deciding a fact in issue in proceedings. That would be illogical. But there is no inconsistency in finding that a factual allegation may well be true but has not been established on the balance of probabilities. Nor is there any reason why the fact that such a finding results in the admission of evidence (by reason of the burden and standard of proof governing its admissibility) should require the finding to be ignored when assessing the weight to be given to the evidence in deciding a fact in issue in proceedings. That would also be illogical. Evidence obtained by torture In the modern law of evidence relevance is the paramount consideration. The general test of whether evidence is admissible is whether it is relevant (or of more than minimal relevance) to the determination of any fact in issue in the proceedings. In the days when facts in civil as well as criminal cases were found by juries and there was fear that more weight would be given to certain kinds of evidence than they deserved, rules were developed to exclude reliance on evidence notwithstanding its relevance. The rule against hearsay is a classic example. The tendency of the law has been and continues to be towards the abolition of such rules. Thus, the rule excluding hearsay evidence has been abolished in civil proceedings. The modern approach is that judges (and, increasingly, juries) can be trusted to evaluate evidence in a rational manner, and that the ability of tribunals to find the true facts will be hindered and not helped if they are prevented from taking relevant evidence into account by exclusionary rules. There are now very few categories of relevant evidence which are inadmissible in civil proceedings, but one such category is evidence obtained by torture. Article 15 of the United Nations Convention Against Torture 1984 imposes an international obligation on state parties to ensure that any statement which is established to have been made as a result of torture shall not be invoked as evidence in any proceedings, except against a person accused of torture as evidence that the statement was made. In A v Secretary of State for the Home Department (No 2) [2005] UKHL 71; [2006] 2 AC 221 a seven member appellate committee of the House of Lords unanimously held that it is also a rule of the common law that evidence obtained by torture is inadmissible in judicial proceedings. A minority (of three members of the committee) would have held that it was sufficient to render evidence inadmissible that there was a real risk that it was obtained by torture. However, it was decided by the majority that the test for this purpose is proof on a balance of probabilities. It is accordingly settled law, and common ground in this case, that if it is proved on a balance of probabilities that a confession (or other statement) on which a party wishes to rely in legal proceedings was made as a result of torture, evidence of the statement is not admissible and must be excluded from consideration altogether when deciding the facts in issue. The total exclusion of evidence shown to have been obtained by torture is not justified on grounds of relevance alone. As the judgments in In re A (No 2) make clear, the exclusion is founded also on reasons of public policy and morality. In the words of Lord Hope at para 112: The use of such evidence is excluded not on grounds of its unreliability if that was the only objection to it, it would go to its weight, not to its admissibility but on grounds of its barbarism, its illegality and its inhumanity. The law will not lend its support to the use of torture for any purpose whatever. It does not follow, and there is no rule, that if it is not proved on a balance of probabilities that a statement was made as a result of torture, evidence that torture was used is not admissible and must be ignored when deciding the facts in issue. There is no legal or logical reason for treating such evidence as inadmissible and good reason to treat it as admissible given its obvious relevance. We go further. A rule that required a court, in assessing the reliability of a confession, to disregard entirely evidence which discloses a serious possibility that the confession was made as a result of torture would not only be irrational; it would also be inconsistent with the moral principles which underpin the exclusionary rule. As Mr Jaffey QC observed in his helpful submissions on behalf of Liberty as an intervenor on this appeal, even when there are reasonable grounds for suspecting that torture has been practised, its use is often inherently difficult to prove because it tends to happen in secret, where there are no safeguards such as the recording of interviews or the presence of a legal representative, and often involves techniques which leave no lasting marks. A rule which excluded evidence that a confession has been obtained by torture unless this has been proved on a balance of probabilities would be calculated positively to encourage the practice of torture to obtain evidence for use in legal proceedings, provided that it is done in a way which is deniable. It would also put evidence that may have been obtained by torture in a uniquely advantageous position, since as counsel for HNA rightly accepted no such rule applies to a possibility that a confession was obtained by ill treatment less severe than torture or by other forms of oppression or inducement. Granting a special dispensation for evidence that may have been obtained by torture would turn the law in this area upside down. In In re A (No 2) the majority of the House of Lords who did not accept that a real risk that evidence was obtained by torture was sufficient to justify its exclusion nevertheless made it clear that such a risk would need to be taken into account in evaluating the evidence. Thus, Lord Hope said (at para 118): So SIAC should not admit the evidence if it concludes on a balance of probabilities that it was obtained by torture. In other words, if SIAC is left in doubt as to whether the evidence was obtained in this way, it should admit it. But it must bear its doubt in mind when it is evaluating the evidence. (Emphasis added) The other judges in the majority agreed with this observation: see paras 141 142 and 145 (Lord Rodger), para 158 (Lord Carswell) and para 173 (Lord Brown). There has been much argument devoted in this case to whether, as HNA contended and the Court of Appeal thought, the relevant passages in the judgments in In re A (No 2) were confined to the context of proceedings in the Special Immigration Appeals Commission (SIAC). We accept that there were conclusions reached in In re A (No 2), including conclusions about the applicable burden and standard of proof, which were specific to that context. However, the observations that, when evaluating evidence which although admissible may have been obtained by torture, a tribunal should bear that possibility in mind are not related to any special feature of SIAC and are no more, in our view, than a reminder of the approach which should rationally be adopted in evaluating such evidence. Conclusion on evidence of torture We conclude that the Court of Appeal was wrong to hold that, if the use of torture has not been proved on the balance of probabilities, a serious possibility that a statement was obtained by torture must be ignored by a court in estimating the weight to be given to the statement. Such an approach is contrary to principle. The true position is that, where there are reasonable grounds for suspecting that a statement was obtained by torture, this is a matter which a judge can and should take into account, along with all other relevant circumstances, in assessing the reliability of the statement as evidence of the facts stated. It follows that in the present case the judge was entitled to rely, as he did, on his finding that torture could not be ruled out as providing further support for the conclusion he had already reached that there was no bribe paid by Mr Xu. Evidence admitted on appeal The Court of Appeal allowed an application by HNA to adduce new evidence in the form of a complaint made by Mr Zhang to the Peoples Procuratorate of Haikou City and the report of the Procuratorate in June 2014 into the outcome of its investigation into this complaint (referred to at paras 20 and 21 above), together with a report of a medical examination of Mr Xu on his arrival at a detention centre on 23 July 2014 (which did not record any injury). The Court of Appeal did not find that this new evidence was a reason to overturn the judges decision. Having reviewed this evidence ourselves, we can see that it would have been relevant to consider it in deciding whether torture had been proved on the balance of probabilities. However, as discussed, the judge did not decide that question. We think it inconceivable that, if this evidence had been available at the trial, it might have affected the judges conclusion that torture could not be ruled out. The most material new document was the investigation report. The report is, however, written in very general terms and adds little or nothing of substance to the record of the interrogation of Mr Xu on 6 June 2014 carried out for the purpose of that investigation and Mr Xus own account of the same occasion given to Mr Guo on 15 September 2014, both of which were in evidence at the trial. The fact that further evidence was admitted in the Court of Appeal therefore makes no difference to our conclusions. The causation issue In the Court of Appeal Shagang argued that, even if the judges finding that no bribe had been paid could not be sustained, his decision should be upheld on the ground that there was no sufficient causal connection between the alleged bribe and Grand Chinas entry into the charterparty. The Court of Appeal rejected that argument. On this appeal it was common ground that, if it became necessary to decide that issue, it would have to be determined at a further trial. As it is unnecessary to remit the case for any further hearing, the issue does not arise. Had it arisen, it was common ground that the observations at paras 84 85 of the judgment of the Court of Appeal had not decided the question. Overall conclusion The judgment which has given rise to an appeal and second appeal in this case is short, running to 16 pages. As Males LJ observed in Simetra Global Assets Ltd v Ikon Finance Ltd [2019] EWCA Civ 1413; [2019] 4 WLR 112 at para 46: succinctness is as desirable in a judgment as it is in counsels submissions, but short judgments must be careful judgments. In this case it is right to observe that the judges reasoning is not merely succinct but sparse. The judgment contains no sustained analysis of the main evidence and arguments. In particular, the judge did not spell out the fact that he was admitting the confession evidence de bene esse, did not in his essential reasoning discuss the confession evidence in any detail and did not directly address the reliance placed by HNA on the fact that three individuals had separately confessed. It is important to make it plain to the losing party that its case has been fully considered and to leave no doubt about the reasons which have led to its rejection. In this case the judge approached this task in too cursory a manner. This can only encourage appeals. The question on an appeal, however, is whether the decision was wrong. For the reasons we have given, none of the key criticisms which led the Court of Appeal to decide that the judges decision is unsustainable and ought to be set aside has been made out. In the final analysis the judge did identify reasons for reaching the conclusion that bribery had not been established and those reasons are sufficient to support that conclusion. It has not been shown that the judge made an error of law or that he reached a conclusion in his evaluation of the facts which no reasonable judge could have reached. Furthermore, the approach adopted by the Court of Appeal to reliance on evidence that statements were made as a result of torture was itself erroneous. The judge was entitled to rely on his finding that torture could not be ruled out as a reason for the confessions as providing additional support for his conclusion that no bribe had been paid. The appeal must therefore be allowed and the judgment in favour of Shagang restored.

This appeal arises out of a claim by the appellant under a guarantee of a contract, to charter a vessel which was met with a defence from the respondent that the contract was procured by bribery and that the guarantee was therefore unenforceable. The bribery allegation was based on evidence of confessions that the appellant alleged were obtained by torture and therefore inadmissible. A contract for the charter of a ship was agreed in August 2008 between the appellant, a Hong Kong company now in liquidation, and the respondents subsidiary, a Hong Kong company also now in liquidation. A guarantee was agreed between the respondent, a Chinese company, and the appellant by which the respondent guaranteed its subsidiarys performance under the contract. The guarantee is governed by English law and confers jurisdiction on the English courts. The vessel was delivered in April 2010, but from September 2010 the subsidiary defaulted on its payments. The appellant brought arbitration proceedings and ultimately terminated the contract for the subsidiarys repudiatory breach. The appellant pursued its claim in arbitration for damages for the subsidiarys breach, achieving a partial final award in November 2012. In September 2012, the appellant commenced proceedings against the respondent under the guarantee in the Commercial Court. In its amended defence, the respondent alleged that the contract had been procured by bribes paid by or on behalf of the appellant to senior employees of the subsidiary. The respondent relied on confessions made by three individuals during an investigation undertaken by the Chinese Public Security Bureau. In an amended reply the appellant alleged that those confessions had been obtained by torture and consequently were inadmissible as evidence in the proceedings. At trial, Knowles J gave judgment in favour of the appellant, finding that there was no bribery and that he could not rule out torture. On appeal, the Court of Appeal held that the judges decision was unsustainable and sent the case back for reconsideration by a different judge. The appellant appealed to the Supreme Court seeking restoration of the judges judgment. The Supreme Court unanimously allows the appeal and restores the judgment in favour of the appellant. Lord Hamblen and Lord Leggatt give the judgment, with which all members of the Court agree. The issue on the appeal is whether the Court of Appeals criticisms were justified and warranted remitting the case for fresh determination. The four main criticisms were that the judge: (i) failed to follow the logical steps necessary to reach a proper evaluation of the admissible evidence; (ii) failed to ask and answer the correct legal question as to what weight should be accorded to the confession evidence; (iii) fell into legal error in failing to take all the appropriate matters into account in deciding the bribery issue; and (iv) fell into legal error in failing to exclude irrelevant matters, including what the Court of Appeal described as his lingering doubt as to whether the confessions were procured by torture, in considering whether the alleged bribe was paid [51] [52]. On the first criticism, the judge had considered the bribery issue before the torture allegations [41] [44]. The Court of Appeal took the view that the judge should have decided the torture allegations first and, having concluded the confession evidence was admissible, proceeded to determine the weight to be given to that evidence, then subsequently have considered whether bribery had taken place [55] [56]. The Supreme Court accepts that the Court of Appeals approach is logical, but it is not mandatory. The manner and order of the consideration of admissibility and weight of evidence are matters for the trial judge and there will usually be more than one legitimate approach [57] [58]. The judge took the confession evidence into account on the assumption, without deciding, that the evidence was admissible. That was a permissible approach [59]. Having done so, the judge considered it unnecessary to make a finding on the torture issues because he was in any event satisfied there was no bribery. The approach taken was both legitimate and consistent with the way the case was put before him [62], [65]. On the second criticism, the Court of Appeal considered that the judge had not adequately addressed the weight to be given to the confession evidence [66]. Though not separately set out, the Supreme Court considers that the judge did address the weight of the evidence in the factors relied upon in his conclusion on bribery. In circumstances where that evidence was the only evidence of bribery, in finding that there was no bribery the judge was necessarily finding that the confession evidence was of little or no weight. It cannot be said that his conclusion on bribery was unreasonable or unsustainable and there were ample grounds to support it [67] [84]. On the third criticism, the Court of Appeal considered that the judge failed to take into account the details of the confessions made and should have addressed each confession made by each individual rather than dealing with them compendiously [85]. Though the Supreme Court agrees that it would have been more satisfactory for the judge to have addressed the confession evidence in greater detail, it is clear that he did consider the confession evidence of all three individuals. The failure to consider it systematically is not an error of law [85] [87]. On the fourth criticism, the Court of Appeal considered that, as the judge did not find the allegation of torture proved on a balance of probabilities, he should have disregarded it entirely [93]. However, the judge did not need to and did not reach any conclusion that torture had or had not been proved [94]. Even if the judge had reached a definite conclusion that torture had not been proved on a balance of probabilities, there would have been no inconsistency between such a conclusion and the finding that torture was a real possibility that affected the reliance that should be placed on the confessions [95]. The facts that the court can take into account in assessing the weight to be given to hearsay evidence in civil proceedings are not limited to facts proved to the civil standard of proof [96]. While it is settled law that evidence proved on a balance of probabilities to have been obtained by torture is inadmissible, there is no rule that if an allegation that torture was used is not proved to that standard a possibility that evidence was obtained by torture must be ignored when deciding the facts in issue [106] [108].

8k-16k

The flags protest, as it has become known, took place throughout Northern Ireland in late 2012 and early 2013. The series of demonstrations and marches that the protest involved presented the Police Service with enormous, almost impossible, difficulties. They strove to deal with those difficulties by using different policing techniques and strategies; responding to intelligence reports; considering representations made by community leaders; continuously re evaluating their decisions; and consulting interested parties who might contribute to the resolution of the problems caused by the protests. They also recorded the deliberations that they undertook and the consultations that they held within the Police Service. A great many police officers were deployed to police the demonstrations and marches. A considerable number of them sustained injuries. Assiduous detection of offenders and their prosecution continued throughout this unhappy time. There can be no reasonable suggestion, therefore, that the police failed to treat the control of parades and demonstrations with sufficient seriousness. They were obviously exercised at an early stage, and throughout the period when the parades and the disorder took place, to seek to control the marches and to minimise the disorder to which they gave rise. It is also clear that police were constantly concerned about the risk of greater disorder occurring with the consequent risk to life which might accrue if they tried to prevent the parades from taking place altogether, rather than policing and controlling them as best they could. This case is not about the sincerity and authenticity of the efforts made by police to control the parades. It is about their conception and understanding of the powers available to them to do so. The various managerial and strategic steps undertaken by the police and the tactical decisions made on foot of them reflect the standards required of and the demands made on a modern police force. It is also, of course, necessary for a police force in our society to have a proper understanding of the extent of the legal powers available to them in order to discharge their duties effectively and fairly in service of the community. The question whether the Police Service for Northern Ireland (PSNI) was sufficiently aware of the full range and scope of those powers is now the principal issue in this appeal. This was not always the position. Application for leave to apply for judicial review was first made on 31 January 2013. Its primary focus was on obtaining relief in relation to a planned parade on 2 February and challenging the failure of PSNI to give assurances that they would take action to prevent that parade from taking place. The statement served in support of the application under Order 53 of the Rules of the Court of Judicature of Northern Ireland (1980) did, however, contain the claim that the failure of PSNI to prevent the parade had the effect of undermining the Public Processions (Northern Ireland) Act 1998 and that it constituted a breach of their obligations under section 32 of the Police (Northern Ireland) Act 2000. As the case progressed and the reasons that the police had not taken action to stop various parades became clear, the emphasis has shifted to an attack on PSNIs failure to recognise and make use of legal powers available to it to prevent the parades from taking place. It is still argued that that failure has undermined the efficacy and proper functioning of the 1998 Act. It is also claimed that the operational decisions of the police have not been proportionate. But these latter arguments have featured somewhat less prominently in the appellants presentation of his appeal before this court. The application for judicial review had also sought orders against the Secretary of State for Northern Ireland for failing to exercise her powers under section 11 of the 1998 Act to prohibit the holding of the procession. That particular application was dismissed. There is no appeal from that dismissal and nothing more need be said about it. The historical setting For a number of years before 1998, considerable public disorder and community conflict were regular features of many contentious parades in Northern Ireland. Until the enactment of the 1998 Act, the police were responsible for deciding whether parades should be permitted to proceed. This placed them in a wholly invidious position. Their impartiality was questioned and they were accused of taking sides both in permitting some parades to proceed and banning others. It was against this background that a report was commissioned by the government into what should be done about the management and control of public processions in Northern Ireland. The chairman of the body which produced the report was Dr Peter North and the report has become known as the North report. Some details about the recommendations which the report contained are given at paras 45 49 below. The 1998 Act created a new public body, the Parades Commission. The commission was charged under section 8 with the function of controlling parades by means of conditions regulating their conduct, imposed on those who organised them. The commission did not have power to prohibit a procession. The Secretary of State did have such a power under section 11, on specific grounds, but it has never been exercised. A key part of the scheme of the 1998 Act was that control of parades would be achieved by conditions imposed by the commission. In order for that vital element to work, a statutory duty (section 6(1)) was placed on those proposing to organise a public procession to give advance notice of that proposal to a member of the police force. By section 6(7) it was made a criminal offence to organise or to take part in a public procession which had not been notified. It was also an offence to fail to comply with any conditions imposed. None of the flags parades in Belfast was notified to the commission. Under the general law the police have a duty to prevent the commission of offences. That fundamental duty of the police, inherent at common law, is expressly confirmed by section 32 of the 2000 Act. There was power, therefore, to prevent a parade from taking place on the grounds that it was likely to result in public order offences. But under the 1998 Act there was also power to prevent the commission of the offence of processing in an un notified parade. The complaint which is made of the police in the present case is that they were conscious of the first of those powers, but they did not properly appreciate the existence and significance of the second. The factual background Until 3 December 2012 the Union flag flew over Belfast City Hall throughout the year. On that date the City Council decided that the flag should fly on certain designated days only. That decision sparked a wave of protests throughout Northern Ireland which continued for some months. The present appeal is concerned with those protests which took place in Belfast and the policing operations that were undertaken to deal with them. After 3 December 2012, the protests in Belfast quickly took on a pattern. Every week, protesters marched from a meeting point in East Belfast to Belfast City Hall which is located in the centre of the city. That route took them through part of the city known as Short Strand. Most residents in the Short Strand area are perceived to be nationalist. Those taking part in the processions were loyalists. When the protesters who had processed from East Belfast assembled at the City Hall, they were joined by others who had found their way to the city centre by other means. Some at least of these others joined the protesters from East Belfast on the march back after the protest. Considerable numbers were involved in the parade which passed through the Short Strand on its return to East Belfast, therefore. There was substantial violence and disorder as the parade went through that nationalist area. Sectarian abuse was directed at the residents of Short Strand; stones and other objects were thrown at them; and their homes were attacked. The appellant is a resident in Short Strand and his and his neighbours homes have come under attack during the parades that took place during December 2012 and January 2013. On 4 December 2012 an initial decision was made that protesters should not be permitted to enter Belfast city centre on Saturday 8 December when, as police knew, a protest at the City Hall was planned. That decision had nothing to do with stopping a parade or march. It was taken because it was considered necessary to prevent disorder. It was felt that the normal life of the city centre should be maintained because of the number of families and other members of the public who would be gathered there at a peak retail period. The reputation of the city at a time when inward investment was being encouraged was also a consideration. In the period between 6 and 8 December police reflected on this decision. That reflection led to a change of mind. In an entry of 7 December 2012 in an Event Policy Book maintained by PSNI, the change in decision was explained. It was considered that there was a need to try and facilitate some form of protest at Belfast City Hall to allow for some venting of anger and [relief of] community tension on this issue. The parades therefore began on 8 December 2012 and, as earlier noted, quickly developed into a weekly pattern. They continued until March 2013. Social media alerted those who wished to participate of their timing and organisation. Until March 2013, police took no action to stop them. The affidavit evidence of Assistant Chief Constable Kerr Soon after it had begun, a police strategy to deal with the flags protest was devised. This was called Operation Dulcet and its leader, designated Gold Commander, was Assistant Chief Constable Will Kerr of PSNI. Chief Superintendent Alan McCrum was appointed Silver Commander. In a series of affidavits filed in these proceedings, Mr Kerr has described how the police developed and implemented plans to deal with the protest. In the first of these he suggested that police have no specific power to ban a procession under the relevant legislation. He stated that PSNI seeks to enforce conditions imposed by the Parades Commission or a prohibition order by the Secretary of State for Northern Ireland. Such an order may be made by the Secretary of State under article 5(1) of the Public Order (Northern Ireland) Order 1987 (SI 1987/463 (NI 7)) in respect of open air public meetings. Significantly. Mr Kerr stated that in the absence of either a Parades Commission determination or prohibition from the Secretary of State, PSNI can only have recourse to general public order policing powers. Having referred to a statement issued by the Parades Commission on 22 February 2013 (in which, among other things, the commission said that the event in East Belfast had not been notified). Mr Kerr made the following statements in paras 21 and 22 of his affidavit: 21. This being the case and there having been no determinations upon any of protests which have taken place close to the Short Strand area, the PSNI have had to police the situation in line with their powers outside of the statutory scheme contained in the [Public Processions (Northern Ireland) Act 1998]. 22. PSNI also have regard to our general functions as contained in Section 32 of the Police (NI) Act 2000 (the P(NI)A) wherein the general duties of the police are set out ie to protect life and property, to preserve order, to prevent the commission of offences and, where an offence has been committed, to take measures to bring the offender to justice. Human Rights considerations are included in decisions made in respect of public order issues such as have arisen during the flag protests. This includes but is not necessarily limited to article 2 Rights (Life) wherein public order disturbances can put this right at risk along with the article 8 Rights (Private Life) of persons in the community and the article 11 Rights (Assembly) of the protesters. The interaction between these competing rights and the status of article 8 and 11 rights as being qualified are all taken into account when operational decisions are being made. Later in the same affidavit Mr Kerr said that where a public procession is not notified under the Public Processions (Northern Ireland) Act 1998, those organising the parade committed an offence under the Act. Tellingly, however, he continued, The role of PSNI in such situations is to collect evidence of such offences and refer them to the prosecuting authorities while also employing public order and common law powers to keep the peace para 39. In a second affidavit, Mr Kerr said that PSNI had consistently held the view that parades can be stopped but not solely because they are unnotified. In February 2013, a change in police policy in relation to the flag protests and in particular the marches coming from and returning to East Belfast occurred. Mr Kerr explained how this came about in para 17 of his second affidavit: the CNR On the 14th of February, as part of the ongoing strategy review, several changes were adopted, one was in respect of the protests processing into the city centre and the other regarded the charging policy The considerations resulting in the decision to stop the unnotified parade included the fact that protests were continuing although with lower numbers, the views of [Catholic/Nationalist/Republican] community that the protests should be stopped, the wider attitude in the PUL [Protestant/Unionist/Loyalist] community that the protests had run their course and the likely reaction from Loyalists would not be extreme as had been the case in or around the 6th of December. In addition, the wish to have a break in time between the protests and the main marching season, the lack of any proper structure in the protests groups whereby an agreed cessation could be settled, the resource considerations in terms of our ability to manage and contain any problems associated with stopping the protests and the impact upon the residents of the Short Strand of the ongoing protests. It should also be noted that what he described as the article 2 risks weighed heavily with ACC Kerr in deciding to permit protestors in the city centre. In an affidavit he said: Between the 6th of December and the 8th of December, the decision not to permit flag protestors to move into the city centre was changed. The rationale for this change was that risks associated with doing so were too great. The intelligence at the time informed us that had we stopped the protests from going into the city centre that the risk to life posed by the resultant disorder and violence posed too great an article 2 risk. The Service Procedure and the Event Policy Book PSNI maintains a service procedure which gives guidance for dealing with public processions and protest meeting applications. It is also intended to provide advice on the interaction between the Parades Commission and PSNI. The service procedure was issued on 31 March 2008 and amended and reissued on 9 June 2011. An event is defined in the procedure as including any event or incident ranging from routine operational policing through to major disorder requiring a degree of planning. When an event has been notified or the police become aware of an intended event, a strategy meeting is held. At the first such meeting an Event Policy Book is opened. Strategic decisions concerning the way in which an event is policed should be recorded in this book. These include major decisions which have an impact on an established strategy; major tactical decisions; any change in strategy; and any issue or decision which may have legal consequences not already addressed in the strategy plan. Between 4 December 2012 and 30 April 2013, no fewer than 67 decisions were taken as to how the parades and the associated disorder would be policed. A record of each of the decisions taken and the reasons for them was made in the Event Policy Book. We were referred to several of these. It is not necessary to advert to more than a few of them. On 6 December 2012 Mr Kerr, in an email to police colleagues about the movement of groups of protesters from various parts of the city towards Belfast City Hall, referred to the rights and presumptions (sic) to peaceful protest, outlined in articles 9 to 11 of ECHR. He pointed out that these were not absolute rights and that the degree of disorder experienced during protests on earlier evenings justified preventing known groups of protesters (from either community) from entering Belfast city centre. This was cited as an example of Mr Kerrs appreciation that the police were entitled to stop unnotified processions or parades. It is plainly not that. To the contrary, the entire tenor of the email is directed towards the public order powers of the police to prevent disorder even where that takes place under the guise of the right to protest. The record of decision appearing in the Event Policy Book of the same date to the effect that a Gold Direction was issued to prevent large numbers of protesters moving towards the city centre prompts the same conclusion. It does not address the question of parades at all, much less the legal powers of police to stop them. A change to the Gold Strategy was introduced in January 2013. This had two aspects: more proactive engagement with protest groups so as to convey to them that blocking the road was against the law; and avoiding the public impression that police were doing nothing. Again, no reference was made to the circumstance that participating in an unnotified parade was a criminal offence and that, where such an event was reasonably apprehended, the police had powers to prevent it. In January 2013, representations were received by PSNI from local representatives of the Short Strand area in which it was suggested that police were facilitating illegal parades. As is clear from the record of decision in the Event Policy Book of 22 January 2013, instead of prompting PSNI to examine its legal powers to stop an unnotified parade, this led to a discussion between ACC Kerr and the Chief Constable that the appropriate means and mechanism to determine how the Public Processions (Northern Ireland) Act should be complied with was for PSNI and the Parades Commission to seek legal advice. It had been agreed between the chairman of the commission and Mr Kerr on 15 January 2013 that both sides should take advice. A letter from Chief Superintendent McCrum to the chairman of the commission on 19 January 2013 stated that un notified processions that had been occurring every Saturday were likely to continue and that the commission might wish to take legal advice as to whether it should be considering these in line with the Public Processions (Northern Ireland) Act 1998. This was followed up by a letter in much the same terms on 23 January. On 12 February 2013 Mr Kerr and another senior police officer met a member of the Legislative Assembly of Northern Ireland who expressed concern about police decisions to facilitate the weekly parade past Short Strand. The Event Policy Books record of this meeting is to the effect that there were policing challenges in dealing with these events, Human Rights Act considerations and gaps in the Public Procession legislation. On 13 February 2013, a record was made that Mr Kerr was considering whether judicial review proceedings should be brought on behalf of PSNI in order to obtain clarity on powers under the Public Processions Act. It was suggested that a judicial review application might act as a catalyst to have weak legislation reviewed and possibly amended. On 14 February 2013 the Events Policy Book recorded for the first time discussion of stopping the parade. Even then, there was no reference to police powers to stop a parade which, because it had not been notified, was illegal. Indeed, it referred to the absence of a legislative (regulatory) fix under the Public Processions (Northern Ireland) Act. ACC Kerrs press interview On 16 February 2013, a local paper, the Irish News, published a report of an interview which one of its journalists had had with Mr Kerr on 14 February. An incomplete transcript of the interview and handwritten notes made by PSNI staff are available. In the course of the interview, Mr Kerr is recorded as saying that a difficulty with the Public Processions Act was that it was predicated at least in part that everybody will consent to being regulated by that means [and] if some people decide that they dont want to be regulated by those means it leaves a gap and that gap at the minute is defaulting to policing and we dont find that acceptable. Later in the interview Mr Kerr said that there was no such thing as an illegal parade under the Public Processions Act, it doesnt exist. He also said that the police had no power to stop an illegal parade under the Public Processions Act, the offence is taking part in an un notified parade. On the contact between the police and the Parades Commission the Assistant Chief Constable said that they had written to the commission in the hope that it would take responsibility for dealing with the parade. The situation was legally complex and that police would welcome some judicial clarity on what exactly the Public Processions Act allowed people to do. The principal concern of the police was not to be placed in the position of having to decide whether a parade should be permitted to take place because they could only make the decision based on a risk or threat to life. The proceedings The application for judicial review generated a substantial number of affidavits. Apart from those of Assistant Chief Constable Kerr, the most significant of these relate to exchanges between police and a local Sinn Fein councillor, Niall ODonnghaile. His council area includes Short Strand. He wrote to Chief Superintendent McCrum on 8 January 2013 asking for information about notification of the parades. He also inquired about the action PSNI intended to take in the event that no notification had been given. In his response of 19 January Mr McCrum confirmed that no notification of the parades had been received. In relation to the action to be taken by PSNI, he said this: As regards the responsibility of PSNI to ensure that parades and protests which have previously resulted in disorder do not occur again, it is important to remember that PSNI do not authorise parades or protests. I am sure you will agree with me that it would be inappropriate in a democratic society for the police to determine when people can protest. However, it is important that the police take all feasible steps to maintain order and PSNI are committed to continuing to do so. Again, as in the affidavits of ACC Kerr, no reference was made to the fact that, by reason of the illegality of the parades under the 1998 Act, the police could resort to common law powers and the statutory duty arising under section 32 of the Police (Northern Ireland) Act 2000 to stop them from taking place. The emphasis was, as before, on the maintenance of order. In a careful and comprehensive judgment, [2014] NIQB 55, Treacy J reviewed the relevant provisions of the 1998 Act; he referred to section 32 of the Police (Northern Ireland) Act 2000 which provides, among other things, that it is the general duty of police to prevent the commission of crime; and he considered the powers of arrest at common law referred to in article 26 of the Police and Criminal Evidence (Northern Ireland) Order 1989 (SI 1989/1341 (NI 12)) to prevent an imminent breach of the peace. The judge also painstakingly examined all the evidence in the case, and in much greater detail than I have considered necessary for the purposes of the appeal. He summarised the appellants submissions in a series of propositions. A simple paraphrase of those may be expressed thus: In failing to stop the weekly parades, PSNI had undermined the 1998 1. Act; 2. The police had been wrong to conclude that they did not have power to stop the parades; 3. ACC Kerr had misunderstood the qualified nature of article 11 of ECHR; 4. The attacks on the appellants home engaged his right under article 8 of ECHR. The state (in the form of its police force) had failed to discharge its positive obligation to protect him from unjustified interference with that right; 5. Operational decisions taken by PSNI were not immune from challenge on the basis that they were taken within an area of discretionary judgment since that had been wrongly informed by the belief that there was no power to stop the parades; and 6. Operational discretion does not, in any event, provide an automatic and blanket immunity H v Commissioner of Police for the Metropolis [2013] EWCA Civ 69; [2013] 1 WLR 3021. The circumstances of the present case were quite different from those of E v Chief Constable of the Royal Ulster Constabulary [2009] AC 536 where the appellant had to surmount the high hurdle of showing that there was a positive obligation to prevent article 3 ill treatment. Furthermore, unlike the position in the present case, there was a substantial body of evidence in E v Chief Constable of the Royal Ulster Constabulary that policing the operation in that case differently might have led to an extension of the protest to other locations and resulted in a risk to lives of other civilians. Treacy J concluded that, in the period between 8 December 2012 and January 2013, ACC Kerr did not consider the option of stopping the weekly parades. PSNI did not behave in a proactive manner to arrest and prosecute those who were organising and participating in the parades. When he did come to consider police action to stop them, Mr Kerr wrongly believed, the judge held, that he was inhibited from doing so by the 1998 Act. The police officer was labouring under a material misapprehension as to the proper scope of police powers and the legal context in which they were operating. para 127 of the judgment. The judge further found that no evidence had been presented to him as to why police had repeatedly permitted violent loyalist protesters to participate in illegal marches both to and from Belfast City Centre on every Saturday between 8 December and 14 February para 122 of his judgment. The judge found that a failure to notify the Parades Commission of an intended parade invests the police with powers to prevent it from taking place. These were equivalent to the powers available to police when parade organisers and participants arrange and take part in parades where conditions imposed by the Parades Commission had not been observed para 134 of his judgment. ACC Kerrs purported distinction between the two scenarios was unsustainable, the judge said. Whether a parade was unlawful by reason of breach of a Parades Commission determination or because of a decision to flout the notice requirement, should not have led to a different police response. In each case the expectation is that the police will seek to uphold the rule of law. para 135. The consequence of the polices failure to appreciate the extent of their powers to deal with the criminal offences of organising and participating in non notified parades had the effect, in the estimation of the judge, of undermining the 1998 Act; it had led to a failure on the part of the police to act in accordance with their obligations under section 32 of the Police (Northern Ireland) Act 2000 and it gave rise to a violation of the appellants article 8 rights para 137 of the judgment. The Court of Appeal (Sir Declan Morgan LCJ, Girvan LJ and Weir J [2014] NICA 56) allowed the Chief Constables appeal against the judgment of Treacy J. The Lord Chief Justice, delivering the judgment of the court, also carefully rehearsed the evidence about the various parades and the action taken by police in relation to them. He quoted from a letter of 31 January 2013 sent by PSNI to the appellants solicitors in response to their pre action protocol correspondence. In it the police had said: Professional policing decisions dealing with public order issues are extremely complicated and require the balancing of a wide range of competing interests. As recognised by the European Court of Human Rights in its decision on the admissibility in PF and EF v United Kingdom (23 November 2010) to require the police in Northern Ireland to forcibly end every violent protest would likely place a disproportionate burden on them, especially where such an approach could result in the escalation of violence across the province. In a highly charged community dispute, most courses of action will have inherent dangers and difficulties and it must be permissible for the police to take all of those dangers and difficulties into consideration before choosing the most appropriate response. At para 34 of the judgment the Lord Chief Justice said that the central issue in the case was whether the police response to the parades was based on the need to take account of the possibility of violence and disorder giving rise to article 2 risks both in the immediate vicinity and in the wider Northern Ireland community. For reasons that I will give presently, I do not consider that this was in fact the central issue in the appeal. Having taken this as the starting point, the judgment proceeded to examine the operational decisions taken by the police. This examination was conducted against the backdrop of the decision of the House of Lords in E v Chief Constable of the Royal Ulster Constabulary [2008] UKHL 66; [2009] AC 536 in which Lord Carswell, drawing on the judgment of the European Court of Human Rights in Osman v United Kingdom (1998) 29 EHRR 245, alluded to the many practical difficulties that confronted police in dealing with protests and making arrests in situations of riot or near riot. Having referred to Lord Carswells opinion on this question, the Lord Chief Justice stated that the same approach should be taken by the Court of Appeal in considering the police conduct in this case. It should also be borne in mind that section 32 of the 2000 Act did not impose a requirement to intervene on every occasion when a crime was being committed. The police had, he said, a wide area of discretionary judgment as to how they should respond para 41 of the judgment. In relation to Treacy Js conclusion that ACC Kerr had not addressed the question of whether to stop the weekly parade, the Lord Chief Justice said that strategy documents indicate that there was ongoing consideration of the manner in which this situation, which at that time extended throughout Northern Ireland, should be managed. para 46. Commenting on the judges view that ACC Kerr wrongly felt himself inhibited by the 1998 Act from taking action to stop the parades, the Lord Chief Justice suggested that this conclusion was based on two, essentially misconceived, considerations. The first was that Mr Kerr had said, when interviewed by the Irish News, that he had no power to stop an unnotified parade; the second was that the assistant chief constable had sought to encourage the Parades Commission to take action in relation to the parades para 49. Dealing with the first of these reasons, the Lord Chief Justice said (at para 47 of the judgment): The interview on which the article was based explored a number of aspects of the unnotified parades. ACC Kerr sought to promote the primacy of the Parades Commission in the regulation of all parades. He indicated that police did not want to find themselves in the situation they were in prior to the 1998 Act. It was against that background that he noted that police did not have power to stop an illegal parade under the 1998 Act. He was correct about that. Such power lay only with the Secretary of State. He noted that the offence under the Act was taking part in an unnotified parade. That again was correct. He went on to indicate that police were faced with having to make decisions about the appropriate response to such parades on the basis of a risk or threat to life. We do not consider that any criticism can be made of that. The difficulty with this passage is that it does not address the point that Treacy J had made. This was that, because ACC Kerr had not adverted to the provision in the 1998 Act which made it illegal to organise or participate in an unnotified parade (section 6(7)), and had failed to recognise that this provided police with the power (and, indeed, the duty under section 32 of the 2000 Act) to prevent this particular species of criminal activity, the option of stopping the parade for that reason was not considered. Contrary to what the Lord Chief Justice said, the police did have power to stop an unnotified parade precisely because participating in such a parade was a criminal offence. Police have common law powers to prevent crime, quite apart from their duty to do so under section 32. The Lord Chief Justice said, in para 48, that ACC Kerr had initially decided to prevent the parade coming into the centre of Belfast which itself was an indicator that he recognised his power to stop it. As pointed out in para 23 above, however, a proper understanding of what was said by Mr Kerr in his email of 6 December 2012 and the entry in the Event Policy Book of the same date, leads inevitably to the conclusion that the police were not exercised about the question of stopping a parade at all. Their concern was to prevent disorder in Belfast city centre and to stop protesters converging there. Discussions about the tactical approach did not take place in the context of an anticipated parade. On the second reason for the judges conclusion (the attempt by ACC Kerr to engage the Parades Commission to deal with the unnotified parades), the Lord Chief Justice said this at para 49: [Mr Kerr] hoped to persuade [the commission] that there was some mechanism by which they could become involved in the determination of the action to be taken in respect of such parades. That certainly was the intention of the North Committee. It is, however, agreed that there is no mechanism by which the Parades Commission can take decisions for unnotified parades. The management of such parades is the responsibility of the police on the basis of their general public order powers and their obligation to prevent crime including crimes under the 1998 Act. Again, this does not deal directly with the judges consideration of the issue. Treacy J had raised the question (in para 129 of his judgment) of Mr Kerr having suggested that the Parades Commission take responsibility when, given that the commission had no role because of the lack of notification about the parades, the only agency that had the legal authority to stop the parade was PSNI. The circumstance that it had been the intention of the North Committee that the Parades Commission should be involved in the regulation of non notified parades is not relevant to ACC Kerrs attempt to persuade the Parades Commission to do what legally it could not. Trying to get the commission to intervene betokened a failure on the part of Mr Kerr to understand that it was the police, not the commission, who had responsibility under the law to prevent the parades from taking place. In para 52 of the Court of Appeal judgment it is stated that that court had seen a transcript of the interview of ACC Kerr by the Irish News and that this was not available to Treacy J. In the same para it is also suggested that the Court of Appeal had been taken through the police strategy documents and the Events Policy Book in greater detail than had been opened to the trial judge. Ms Quinlivan QC, who appeared for the appellant, disputed both those statements. It is not possible to assess how detailed was the consideration before the judge of the various strategy documents etc. But it is abundantly clear (and not disputed by Mr McGleenan QC for the respondent) that the judge had seen the transcript of the interview. Indeed, he quoted from it in para 73 of his judgment. The Court of Appeal concluded that the 1998 Act had not been undermined by the decisions and actions of the police in relation to the parades. It also decided that the steps taken by the police to protect the article 8 rights of the appellant and other residents of Short Strand were proportionate. The North report In August 1996 the government commissioned an independent review of contentious parades and marches in Northern Ireland. As earlier noted, the body convened to conduct the review was chaired by Dr Peter North and its report, published in January 1997, has become known as the North report. The Public Processions (Northern Ireland) Act 1998 implemented the report, although not all of its recommendations found their way into the legislation. Before the 1998 Act police had responsibility for imposing conditions on public parades. Article 3(1) of the Public Order (Northern Ireland) Order 1987 required a person proposing to organise a public procession to give seven days written notice of that proposal to the police. Article 4 of the 1987 Order provided: (1) If a senior police officer, having regard to the time or place at which and the circumstances in which any public procession is being held or is intended to be held and to its route or proposed route, reasonably believes that it may result in serious public disorder, serious (a) damage to property or serious disruption to the life of the community; or (b) the purpose of the persons organising it is the intimidation of others with a view to compelling them not to do an act they have a right to do, or to do an act they have a right not to do, he may give directions imposing on the persons organising or taking part in the procession such conditions as appear to him necessary to prevent such disorder, damage, disruption or intimidation, including conditions as to the route of the procession or prohibiting it from entering any place specified in the directions. The North report concluded that a new independent body was required which would replace the police as the organisation to decide whether a parade would take place and, if so, under what conditions. The report was not solely concerned with the identity of the body that would take decisions about whether parades should be permitted to take place and under what conditions they ought to be allowed to proceed. Public order considerations, which were intrinsic to the operation of the police powers to control processions under the 1987 Order, were no longer to be the sole driver for determining whether and in what circumstances parades should be permitted to take place, although the report did recommend that the police should retain the power to intervene on public order grounds in the extreme circumstances of the determination of the Parades Commission being defied Chapter 12 para 12.124 of the report. Generally, however, the report considered that putting emphasis on the question whether a particular parade might cause disorder ran the risk of rewarding threats that such disorder would take place. New criteria were required which should include the need to have regard to the impact that a parade would have on relationships within the community. The North report envisaged that parades should come to the Parades Commissions attention in any one of three ways first on referral by the police; second on the initiative of the commission itself; and third as a result of public representation Chapter 12 paras 12.55 et seq. As it happened, however, the structure of the 1998 Act did not cater for the commission having power to make determinations in relation to processions unless the police had been notified of a parade and had sent a copy of the notice to the commission thereby triggering their powers. The Public Processions (Northern Ireland) Act 1998 The Parades Commission was established by section 1 of the 1998 Act. Its functioning in relation to controlling public processions depends on receipt of a notification of an intention to hold a parade. Section 6(1) of the Act provides that a person proposing to organise a public procession shall give notice of that proposal to a member of the police force; within a stipulated period (section 6(2)); in a prescribed form (section 6(3)); and providing certain specified information (section 6(4)). By virtue of section 6(6) the Chief Constable is to ensure that the Parades Commission is provided with a copy of the notice immediately. Section 6(7) makes it an offence to organise or take part in a procession that has not been notified. It provides: (7) A person who organises or takes part in a public procession (a) section as to notice have not been satisfied; or in respect of which the requirements of this (b) which is held on a date, at a time or along a route which differs from the date, time or route specified in relation to it in the notice given under this section, shall be guilty of an offence. Section 8 gives the commission powers to impose on persons organising or taking part in a proposed public procession such conditions as it considers necessary. These may include conditions as to the route of the procession and prohibiting it from entering any place. Section 9 gives the Secretary of State power to review a determination by revoking or amending it. Section 11 empowers the Secretary of State to ban processions in certain circumstances. This provision has not been invoked during the life of the commission. Although article 4(1) of the 1987 Order was repealed by the 1998 Act, the recommendation that had been made in the North report that police should retain the power to intervene on public order grounds if the determination of the Parades Commission was defied, was not implemented. This does not mean, of course, that the police could not have recourse to common law powers to stop a parade in order to prevent disorder and to the duty under section 32 of the 2000 Act in order to avert the criminal offence of participating in an unnotified parade contrary to section 6(7) of the 1998 Act. The Court of Appeal in para 19 of its judgment (perhaps in contrast to its later statement in para 47 see para 41 above) acknowledged that these powers were available to PSNI but considered that the incomplete enactment of the North report created a particular difficulty for the police: The North Report recognised that under its proposals there would still remain that cohort of parades that were last minute or unforeseen. It considered that in those circumstances the parades should be controlled by police using their public order powers. The problem for police, which the circumstances in this case demonstrate, is that the partial implementation of the North Report has left a larger cohort of parades outside the Parades Commissions jurisdiction. In particular, the PSNI have to deal with unnotified parades using their available public order powers including the right of arrest in respect of the organisation or participation in such parades and the prevention of such unlawful parades in accordance with the duty under section 32 of the 2000 Act to prevent crime. It is not clear why this should be regarded as a particular problem, at least in terms of police operational decisions. When the correct legal position is understood, namely that the police have power to stop parades to prevent disorder and to pre empt breach of section 6(7) of the 1998 Act, the police strategy and tactics in exercising those powers would have been similar, if not identical, to those which they would deploy to prevent a parade from proceeding in a manner which did not comply with a determination of the Parades Commission. Neither situation called on the police to form a judgment as to whether a parade should take place. What was required of them in both instances was a decision as to whether the parade was taking place legally. If it was not, either because it did not comply with a determination of the commission or because it had not been notified, their powers were, to all intents and purposes, the same. And the operational decisions should not have been any different, or, at least, certainly not on account of the fact that each parade contravened the law in different ways or that the source of the power of the police to stop the parade arose from different sections of the 1998 Act. Article 11 of the European Convention on Human Rights Article 11 of the European Convention on Human Rights and Fundamental Freedoms (ECHR) provides: 1. Everyone has the right to freedom of peaceful assembly and to freedom of association with others, including the right to form and to join trade unions for the protection of his interests. 2. No restrictions shall be placed on the exercise of these rights other than such as are prescribed by law and are necessary in a democratic society in the interests of national security or public safety, for the prevention of disorder or crime, for the protection of health or morals or for the protection of the rights and freedoms of others. This article shall not prevent the imposition of lawful restrictions on the exercise of these rights by members of the armed forces, of the police or of the administration of the State. ACC Kerr clearly regarded what he described as the interaction between articles 8 and 11 of ECHR as important see para 17 above. He also considered that it was significant that both were qualified rights. During his interview with the Irish News he had said: The European Convention makes it very clear that there is a right to peaceful assembly under article 11 of the European Convention and the reasons it gets slightly confusing sometimes is that the European Convention is explicitly clear the Police Service has a responsibility to facilitate peaceful protests even if it is technically unlawful and thats where it takes us in to the space of confusing rights. In Eva Molnar v Hungary (Application 10346/05) the European Court of Human Rights (ECtHR) considered a complaint that the applicants rights under article 11 had been infringed by police dispersing a peaceful demonstration in which she had participated merely because prior notification of the protest had not been given. At paras 34 38 ECtHR said this: 34. The Court observes that paragraph 2 of article 11 entitles States to impose lawful restrictions on the exercise of the right to freedom of assembly. The Court notes that restrictions on freedom of peaceful assembly in public places may serve the protection of the rights of others with a view to preventing disorder and maintaining the orderly circulation of traffic. 35. The Court reiterates that a prior notification requirement would not normally encroach upon the essence of that right. It is not contrary to the spirit of article 11 if, for reasons of public order and national security, a priori, a High Contracting Party requires that the holding of meetings be subject to authorisation (see Nurettin Aldemir v Turkey, nos 32124/02, 32126/02, 32129/02, 32132/02, 32133/02, 32137/02 and 32138/02 (joined), para 42, 18 December 2007). 36. However, in special circumstances when an immediate response might be justified, for example in relation to a political event, in the form of a spontaneous demonstration, to disperse the ensuing demonstration solely because of the absence of the requisite prior notice, without any illegal conduct by the participants, may amount to a disproportionate restriction on freedom of peaceful assembly (see Bukta, cited above, paras 35 and 36). It is important for the public authorities to show a certain degree of tolerance towards peaceful gatherings if the freedom of assembly guaranteed by article 11 of the Convention is not to be deprived of all substance (see Nurettin Aldemir, cited above, para 46). 37. Nevertheless, in the Courts view, the principle established in the case of Bukta cannot be extended to the point that the absence of prior notification can never be a legitimate basis for crowd dispersal. Prior notification serves not only the aim of reconciling, on the one hand, the right to assembly and, on the other hand, the rights and lawful interests (including the right of movement) of others, but also the prevention of disorder or crime. In order to balance these conflicting interests, the institution of preliminary administrative procedures is common practice in member states when a public demonstration is to be organised. In the Courts view, such requirements do not, as such, run counter to the principles embodied in article 11 of the Convention, as long as they do not represent a hidden obstacle to the freedom of peaceful assembly protected by the Convention (see Balcik v Turkey, no 25/02, para 49, 29 November 2007). 38. The Court therefore considers that the right to hold spontaneous demonstrations may override the obligation to give prior notification to public assemblies only in special circumstances, namely if an immediate response to a current event is warranted in the form of a demonstration. In particular, such derogation from the general rule may be justified if a delay would have rendered that response obsolete. ACC Kerrs belief that PSNI was obliged by article 11 of ECHR to facilitate peaceful protests even if they were technically illegal was therefore misplaced. ECtHR has made it clear that, in general, a requirement to notify an intention to hold a parade and a decision to disperse a parade or protest which has not been notified will not infringe article 11. There was no warrant for allowing article 11 considerations to determine how these parades should be policed. Ms Quinlivan submitted that the 1998 Act occupies the field for virtually all planned demonstrations in Northern Ireland. She also claimed that, in relation to protests such as involved in the parades here, the vital ingredient of spontaneity (which might absolve organisers of the need to notify) was missing. In both propositions she is clearly right. The 1998 Act is the considered response of Parliament to the intractable problem of parades in Northern Ireland. Fundamental to its successful operation is the requirement that there be notification of parades, especially those which are likely to be contentious or to provoke disorder. The parades in this case were far from peaceful. The police had no obligation to facilitate them. To the contrary, they had an inescapable duty to prevent, where possible, what were plainly illegal parades from taking place and to protect those whose rights under article 8 of ECHR were in peril of being infringed. Meeting those obligations had to be tempered by operational constraints, of course. Stopping the parades without taking account of what further violence that might provoke was not an option. But the operational difficulties required to be assessed in the correct legal context. PSNI had to have a clear sighted appreciation of their available powers and an equally percipient understanding of the fact that the Parades Commission had no power to intervene. I shall discuss this in more detail in the next section of this judgment. Undermining the 1998 Act Failure to notify a proposed parade strikes at the heart of the effective functioning of the Parades Commission and therefore at the successful implementation of the 1998 Act. This Act represented, as Ms Quinlivan put it, a paradigm shift away from the old system where police were drawn into the controversial role of deciding which parades should be permitted to take place and under what conditions they should be allowed to proceed. Enforcing the legal requirement of notifying an intention to hold a parade was not less than vital to the success of the new venture. A premium had to be placed on preserving the integrity of that requirement. Unfortunately, ACC Kerr and his colleagues failed to recognise this central truth. There is no reference to section 6(7) of the 1998 Act in the many entries in the Event Policy Book. Instead, the focus was on the need to recognise the competing claims under articles 8 and 11 of ECHR; the so called gaps in the 1998 legislation; the need to engage the Parades Commission in some role in controlling the parades; the lack of power on the part of the police to ban parades; the need to police the situation outside of the statutory scheme; that the role of the police was to collect evidence of such offences and refer them to the prosecuting authorities; that the parades could not be stopped solely because they were unnotified; that there was no such thing as an illegal parade under the Public Processions Act; and that the situation was legally complicated and judicial clarification was needed. The situation was not legally complicated, although, in fairness to ACC Kerr this is a judgment that can be made in confidence now, with the benefit of close attention to the text and effect of the 1998 Act. But, having had the opportunity to consider these and the powers of the police both at common law and under section 32 of the 2000 Act, it can be assuredly said that there is no reason to suppose that the avowed gaps in the 1998 Act were other than the product of deliberate legislative intention. Likewise it must now be clearly understood that the Parades Commission had no role where a proposed procession had not been notified. The attempt to persuade the commission to become involved was misconceived. The police did not have power to ban the parades but they had ample legal power to stop them. Contrary to ACC Kerrs stated position, they could indeed be stopped solely because they were unnotified. There certainly was such a thing as an illegal parade under the Public Processions Act. All of that is quite different from saying that police decisions undermined the 1998 Act, however. Clearly, there was no considered intention to weaken the effect of the Act. The view of ACC Kerr and his colleagues on what were perceived to be shortcomings of the Act and their lack of powers to stop the parades were the result of misapprehension of the true legal position rather than a wilful disregard for it. It is true, of course, that the Loyal Orange Order, in light of PSNIs response to the unnotified parades, considered adopting a policy of not notifying the commission of intended parades, contrary to their previous practice of doing so. But that does not signify in the debate as to whether the 1998 Act was in fact undermined. As it happens such a policy was not adopted by the Orange Order. The power of the police to stop a parade which has not been notified has been a consistent thread that runs through the judgments of Treacy J, of the Court of Appeal and of this court, although the emphasis on the importance of this may have varied. Whatever may have been the misapprehension of the police as to their powers to stop a parade which had not been notified, the legal position is now clear. The 1998 Act has not been undermined. The central issue The Lord Chief Justice considered that the central issue in the case was whether the police response to the parades was based on the need to take account of the possibility of violence and disorder giving rise to article 2 risks both in the immediate vicinity and in the wider Northern Ireland community. One can understand why this might have been considered to be the dominant question. But it is now clear that the crucial issue was whether there was a proper understanding on the part of the police as to the extent of their legal powers. Of course, there were many pressing concerns about the possibility of increased violence if the police attempted to stop the parades. But this must not distract from what was the true issue in the case. That was did the police approach the difficult decision of whether to stop the parades with a proper understanding of their legal powers. If they wrongly considered that there were limits on their powers to do so, this would inevitably cloud their judgment on that critical question. For the reasons that I have given, I consider that Treacy J was right in his conclusion that the police laboured under a misapprehension as to the extent of their powers and on that account alone the appeal must be allowed. Operational discretion It is universally agreed that PSNI must have operational discretion to make policing decisions. Treacy J accepted this in para 120, after citing the well known passage from para 116 of ECtHRs judgment in Osman v United Kingdom (1998) 29 EHRR 245. The Court of Appeal dealt with the same issue in paras 38 41 of its judgment. It is also generally accepted, however, that operational discretion does not equate to immunity from judicial scrutiny of policing decisions. As Lord Dyson MR said in H v Commissioner of Police of the Metropolis v ZH [2013] 1 WLR 3021 at para 90: operational discretion is important to the police. It has been recognised by the European court: see [(2012)] Austin v United Kingdom 55 EHRR 359, para 56. And I have kept it well in mind in writing this judgment. But operational discretion is not sacrosanct. It cannot be invoked by the police in order to give them immunity from liability for everything that they do. The debate in the present case has centred on how judicial scrutiny of the policing decisions taken about these parades should be conducted. The appellant suggested that the discretion was circumscribed by the imperative of ensuring the full effectiveness of the 1998 Act. The area of discretion available to the police was also constrained by the positive obligation to protect the appellants article 8 rights, Ms Quinlivan argued. She claimed that policing decisions in this context had to satisfy a requirement of proportionality. In advancing this claim she relied on what had been said by Lord Carswell in E v Chief Constable of the Royal Ulster Constabulary [2009] AC 536. That case was concerned with attempts by loyalist protesters in Belfast to prevent Catholic parents from taking their normal route on foot through a loyalist area to a Catholic girls primary school. The appellant had challenged what she claimed was the failure of police to discharge their positive obligation to protect her and her daughter against the infliction upon them of inhuman and degrading treatment within the meaning of article 3 of ECHR. Having considered R (Daly)v Secretary of State for the Home Department [2001] 2 AC 532, Huang v Secretary of State for the Home Department [2007] 2 AC 167 and R (SB)v Governors of Denbigh High School [2007] 1 AC 100, Lord Carswell said this at para 54: [these cases] all concerned the compatibility of decisions of an administrative character with the Convention rights of those affected by them. Nevertheless, the essential point established by them is that the Smith test [see R v Ministry of Defence, Ex p Smith [1996] QB 517, 554] is insufficiently intense and that the actions of the police in the present case have to pass the test of proportionality, which must be decided by the court. Ms Quinlivan criticised the judgment of the Court of Appeal in the present case on the basis that it had failed to consider whether the actions of the police passed the test of proportionality. It is true that the court did not refer to the question whether the police actions were proportionate but it appears to have accepted that the appellants article 8 rights were engaged and the Lord Chief Justice referred on more than one occasion to Lord Carswells judgment in E so it is difficult to conclude that he did not have the question of proportionality in mind. Whatever of that, it seems to me that there is something of an air of unreality about discussing the question of proportionality given that PSNI had wrongly construed their powers under the 1998 Act and the Court of Appeal failed to so find. Like so much else involved in judicial review of police actions, proportionality depends on context and PSNI had set themselves the wrong context in which to make decisions. Ms Quinlivan was therefore inclined to accept that a finding that the police had failed to recognise the true breadth and nature of their powers under the legislation would render discussion of the discretionary area of judgment less than central to the case. She was right to do so. What might be considered proportionate if the police view of the limits on their powers was correct might be considered not to be so if they had recognised the full panoply of controls that were in fact available. Discussion of what might have been proportionate in those circumstances is unlikely to be helpful. So too is speculation about what the police ought to have done if they had a proper understanding of the powers available to them. One can say that proportionality has certainly a role to play in assessing whether police actions have fulfilled their positive obligation to protect the appellants article 8 rights. One may also say that police took an active and continuing approach to the question of how to deal with the parades. Many officers were injured in the course of policing the flags protest. Many participants were arrested and successfully prosecuted. Constant review of the proper tactical approach was undertaken. A definite area of discretionary judgment must be allowed the police. And a judgment on what is proportionate should not be informed by hindsight. Difficulties in making policing decisions should not be underestimated, especially since these frequently require to be made in fraught circumstances. Beyond these generalities, I do not consider it useful to go. Treacy J has said (in para 136) that the policing operation was characterised by an unjustified enforcement inertia. I do not understand him to suggest that this was the result of studied indifference or deliberate lack of response to the very difficult situation faced by the residents of Short Strand. The absence of a more proactive approach was due to a concatenation of unfortunate circumstances. These included the misunderstanding by PSNI of the powers available to them; their failure (at least in the early stages) to appreciate that the Parades Commission was powerless to intervene; a lack of insight into the central importance of ensuring that unnotified parades were not permitted to take place; the placing of too great an emphasis on the possible article 11 rights of protesters; and that the matter of controlling unnotified parades was legally complicated. Review by an appellate court of findings at first instance On several occasions in the recent past this court has had to address the issue of the proper approach to be taken by an appellate court to its review of findings made by a judge at first instance. For the purposes of this case, perhaps the most useful distillation of the applicable principles is to be found in the judgment of Lord Reed in the case of McGraddie v McGraddie [2013] UKSC 58; [2013] 1 WLR 2477. In para 1 of his judgment he referred to what he described as what may be the most frequently cited of all judicial dicta in the Scottish courts the speech of Lord Thankerton in Thomas v Thomas [1947] AC 484 which sets out the circumstances in which an appeal court should refrain from or consider itself enabled to depart from the trial judges conclusions. Lord Reeds discourse on this subject continued with references to decisions of Lord Shaw of Dunfermline in Clarke v Edinburgh & District Tramways Co Ltd 1919 SC (HL) 35, 36 37, where he said that an appellate court should intervene only it is satisfied that the judge was plainly wrong; that of Lord Greene MR in Yuill v Yuill [1945] P 15, 19, and that of Lord Hope of Craighead in Thomson v Kvaerner Govan Ltd [2003] UKHL 45; 2004 SC (HL) 1, para 17 where he stated that: It can, of course, only be on the rarest occasions, and in circumstances where the appellate court is convinced by the plainest of considerations, that it would be justified in finding that the trial judge had formed a wrong opinion. Lord Reed then addressed foreign jurisprudence on the topic in paras 3 and 4 of his judgment as follows: 3. The reasons justifying that approach are not limited to the fact, emphasised in Clarkes case and Thomas v Thomas, that the trial judge is in a privileged position to assess the credibility of witnesses evidence. Other relevant considerations were explained by the United States Supreme Court in Anderson v City of Bessemer (1985) 470 US 564, 574 575: The rationale for deference to the original finder of fact is not limited to the superiority of the trial judges position to make determinations of credibility. The trial judges major role is the determination of fact, and with experience in fulfilling that role comes expertise. Duplication of the trial judges efforts in the court of appeals would very likely contribute only negligibly to the accuracy of fact determination at a huge cost in diversion of judicial resources. In addition, the parties to a case on appeal have already been forced to concentrate their energies and resources on persuading the trial judge that their account of the facts is the correct one; requiring them to persuade three more judges at the appellate level is requiring too much. As the court has stated in a different context, the trial on the merits should be the main event rather than a tryout on the road. For these reasons, review of factual findings under the clearly erroneous standard with its deference to the trier of fact is the rule, not the exception. Similar observations were made by Lord Wilson JSC in In re B (A Child) [2013] 1 WLR 1911, para 53. 4. Furthermore, as was stated in observations adopted by the majority of the Canadian Supreme Court in Housen v Nikolaisen [2002] 2 SCR 235, para 14: The trial judge has sat through the entire case and his ultimate judgment reflects this total familiarity with the evidence. The insight gained by the trial judge who has lived with the case for several days, weeks or even months may be far deeper than that of the Court of Appeal whose view of the case is much more limited and narrow, often being shaped and distorted by the various orders or rulings being challenged. The statements in all of these cases and, of course, in McGraddie itself were made in relation to trials where oral evidence had been given. On one view, the situation is different where factual findings and the inferences drawn from them are made on the basis of affidavit evidence and consideration of contemporaneous documents. But the vivid expression in Anderson that the first instance trial should be seen as the main event rather than a tryout on the road has resonance even for a case which does not involve oral testimony. A first instance judgment provides a template on which criticisms are focused and the assessment of factual issues by an appellate court can be a very different exercise in the appeal setting than during the trial. Impressions formed by a judge approaching the matter for the first time may be more reliable than a concentration on the inevitable attack on the validity of conclusions that he or she has reached which is a feature of an appeal founded on a challenge to factual findings. The case for reticence on the part of the appellate court, while perhaps not as strong in a case where no oral evidence has been given, remains cogent. In the present appeal, I consider that the Court of Appeal should have evinced a greater reluctance in reversing the judges findings than they appear to have done. Conclusion I would reverse the decision of the Court of Appeal and make a declaration that, in their handling of the flags protest in Belfast during the months of December and January, PSNI misconstrued their legal powers to stop parades passing through or adjacent to the Short Strand area.

The Public Processions (Northern Ireland) Act 1998 (the 1998 Act) placed responsibility for the management of parades in Northern Ireland in the hands of an independent statutory body called the Parades Commission. The Act placed a duty on anyone proposing to organise a public procession to give advance notice to the police and made it a criminal offence to organise, or take part in, a public procession of which notification had not been given. On 3 December 2012 Belfast City Council decided to stop flying the Union flag over Belfast City Hall every day. The flag was to be flown on certain designated days only. The decision sparked a wave of protests by loyalists which continued for some months and became known as the flags protests. The protesters marched from a meeting point in East Belfast to Belfast City Hall in the centre of the city and back again. The route took the parade through the Short Strand, which is perceived to be a nationalist area, and where violence, disorder and sectarian abuse were directed at residents. No notification was made under the 1998 Act that a parade was due to take place. Initially, in order to prevent potential disorder, the police had taken the decision not to permit the protesters to enter Belfast City Centre. But between 6 and 8 December 2012 this decision was changed, as it was considered there was a need to try to facilitate some form of protest in order to ease community tension. Therefore, when the parades began on 8 December 2012 the protesters were permitted to enter the City Centre and pass through the Short Strand area. The weekly parades continued until March 2013, during which time the police took no action to stop them. The police made a number of public announcements to the effect that it had no power to stop a parade that had not been notified under the 1998 Act. They also tried, unsuccessfully, to refer the matter to the Parades Commission. The appellant, a resident of Short Strand, issued judicial review proceedings challenging the failure of the police to take action to prevent the parades from taking place. The High Court found that the police had failed to appreciate the extent of its powers to stop an un notified parade, which had the effect of undermining the 1998 Act. The Court of Appeal allowed the Chief Constables appeal. DB appealed to the Supreme Court. The Supreme Court unanimously allows DBs appeal and declares that the Police Service of Northern Ireland misconstrued their legal powers to stop parades passing through or adjacent to the Short Strand area. Lord Kerr gives the judgment, with which the other Justices agree. The flag protests presented the Police Service of Northern Ireland with enormous, almost impossible difficulties [1]. There can be no suggestion that they failed to treat them with sufficient seriousness. This case is not about the sincerity and authenticity of those efforts, it is about whether, corporately, the police were sufficiently aware of the full range and scope of the powers available to them [3]. The police have a duty, under the general law, to prevent the commission of offences. Participating in an un notified parade is a criminal offence under the 1998 Act and as such the police therefore had the power to prevent the parades. The police failed properly to appreciate this, instead believing that they only had a power to prevent the commission of general public order offences [10]. The police were not required to form a judgment as to whether a parade should take place, but they were required to decide whether the parade was taking place legally. Failure to notify a proposed parade strikes at the heart of the effective functioning of the Parades Commission and therefore at the successful implementation of the 1998 Act. This Act represented a paradigm shift away from the old system where police were drawn into the controversial role of deciding which parades should be permitted to take place and under what conditions they should be allowed to proceed [63]. The police failed to recognise that the integrity of the system depended on the enforcement of the requirement to notify an intention to hold a parade [64]. It is the police, not the Parades Commission, who have the responsibility for preventing un notified parades from taking place [45]. The police mistakenly believed that they were obliged by article 11 of the European Convention on Human Rights (freedom of assembly and association) to facilitate peaceful protests, even though they thought the protests were technically illegal. To the contrary, they had an inescapable duty to prevent, where possible, what were plainly illegal parades from taking place and to protect those whose rights under article 8 of the European Convention (respect for private life) were in peril of being infringed, subject to operational constraints. In general, a decision to disperse a parade or protest which has not been lawfully notified will not infringe article 11. There was no warrant for allowing article 11 considerations to determine how the parades should be policed [60 62]. The High Court was therefore right to conclude that the police laboured under a misapprehension as to the extent of their powers [70]. The polices policy did not, however, have the intention or the effect of undermining the 1998 Act [66]. The police had an operational discretion in deciding how to respond to the parades. Discussion of what action might have been taken had the police properly understood the limits of their powers is unlikely to was unhelpful [74]. Difficulties in making policing decisions should not be underestimated, especially since these frequently require to be made in fraught circumstances [76]. The absence of a more proactive approach was not caused by police inertia, but by a concatenation of unfortunate circumstances, including misunderstandings about the powers available to them [77].

8k-16k

This appeal challenges the validity of two patents, which seek to confer a monopoly over the creation of a range of types of transgenic mouse. The subject matter, genetic engineering for medical purposes, is of great technical complexity, but the legal question which falls for determination in this court may be quite shortly stated. It is a general requirement of patent law both in this country and under the European Patent Convention (EPC) that, in order to patent an inventive product, the patentee must be able to demonstrate (if challenged) that a skilled person can make the product by the use of the teaching disclosed in the patent coupled with the common general knowledge which is already available at the time of the priority date, without having to undertake an undue experimental burden or apply any inventiveness of their own. This requirement is labelled sufficiency. It is said that the invention must be enabled by the teaching in the patent. Patent protection is sometimes claimed for a single product, but sometimes for a range of products. Whether the patent claims one or the other is a question of construction of the claim (or claims) in the patent. In the latter case the sufficiency requirement has usually been expressed as meaning that the invention must be enabled over the whole of the range of products for which the claim is made. In the present case both the trial judge (the late Henry Carr J) and the Court of Appeal construed the relevant claim as extending to a range of products (transgenic mice) answering a certain description. The judge held that the teaching in the patent did not enable any type of mouse within the range to be made, let alone mice across the whole of the relevant range. The Court of Appeal held, to the contrary, that the teaching in the patent, coupled with the available common general knowledge as at the priority date, did enable some types of mouse within the range to be made, but not all types across the whole range. There is no appeal against that essentially factual finding. But they held that the sufficiency requirement was nonetheless satisfied, because the invention for which protection was claimed amounted to an inventive, indeed ground breaking, general principle, such that every type of mouse with the specified characteristics would display the particular benefits which the invention was designed to achieve, benefits which would not be displayed by any types of mouse outside the specified range. The invention constituted by the specified characteristics was therefore sufficiently enabled across the whole scope of the claim, and matched the contribution which the disclosure of the invention made to the article The question for this court is therefore whether a product patent, the teaching of which enables the skilled person only to make some, but not all, of the types of product within the scope of the claim, passes the sufficiency test where the invention would contribute to the utility of all the products in the range, if and when they could be made. This is a pure question of law, but an understanding of its implications requires at least a bare summary of the technical context in which it arises. A full description of the technical context may be found in the judgments of the courts below. The Technical Background in Outline By the priority date, which was 16 February 2001, it was well recognised that antibodies (also known as immunoglobulins) could be used for treatment of disease in humans, by way of augmentation of, or in substitution for, antibodies produced by the patients own immune systems. Since the development of antibodies is a natural process shared by mammals generally, and since ethical constraints prevented the use of fellow humans as platforms for antibody development, mice had been identified as suitable platforms for the development of antibodies suitable for use in treatment of humans, and were already in use for that purpose by the priority date. Two main problems inhibited the use of mice for that purpose. The first was that humans tend to reject murine antibodies. The second was that if human antibody genes are genetically implanted in mice, so that the mice then produce human antibodies coded from those genes, then the mice suffer from a reduced immune response, and therefore reduced development of suitable antibodies in response to antigens, which seriously impairs their efficiency as platforms for antibody development. In the jargon of this litigation, this rendered the mice immunologically sick. The solution, which is the innovative idea at the heart of this case, was to develop a hybrid (chimeric) antibody gene structure, consisting in part of human and in part of murine elements, created by insertion into the genome of the mouse. Mammalian antibodies are proteins which all share a characteristic structure consisting of four polypeptide chains, two identical heavy chains and two identical light chains bonded in a Y formation. Each chain has a constant region, so named because it does not vary in its segments, called C segments, and a variable region, in which the segments vary between different antibodies. In both mice and humans the variable regions consist, in the light chains, of V (variable) and J (joining) segments and, in the heavy chains, of V, D (diversity) and J segments. Production of antibodies is one of the major functions of B cells. The natural development of specific antibodies in humans and mice involves a complex process of rearrangement among the segments in the variable regions, within the B cells which are created in the bone marrow. During this stage of development, each B cell acquires a B cell receptor on its surface. As a result of different combinations of the V, D and J segments, B cells are created with a variety of B cell receptors. As all the antibodies made by one B cell are identical, it is necessary to produce a diversity of B cells in order to have a diversity of antibodies. The degree of variety is important, because the body faces invasion by a wide variety of antigens associated with disease. The effectiveness of the bodys immunological response against a specific antigen depends upon the body producing a B cell whose receptor happens to be capable of binding to that antigen. The chances of that happening are increased the greater the number of different B cells (with different receptors) which the body produces. Repeated rearrangements of the V, D and J segments (known as somatic gene rearrangement or V(D)J recombination) through combinatorial use of a number of different gene segments coding for the polypeptide chains means that a huge variety of antibodies can be generated eventually. Where a B cell does encounter an antigen to which it binds, it is activated and induced to divide and differentiate. Repeated cell divisions give rise to sizeable clones that depend on antigen recognition for their survival. B cells that are unable to bind the antigen simply die. Those that do bind the antigen can be taken and subjected to other processes to produce antibodies in quantities which can be introduced into humans to combat or vaccinate against that particular antigen. It was generally understood, at least as at the priority date, that these processes of rearrangement were likely to be optimised, and the range of potential and effective antibodies increased, if the antibody genes implanted in the mice had as many as possible of the human V, D and J segments included within them. A typical human heavy chain gene locus has around 125 V segments (each different from the others), 27 D segments and nine J segments in the variable region. If the V and J segments in the light chains gene loci are factored in as well, the number of possible combinations which may be made from the human antibody gene loci is about 1.5m. The hybrid gene structure at the heart of the present dispute was designed to combine within one antibody gene structure the murine constant region and the whole of the human variable region. That was indeed what the patents in issue taught. But the judge found that the formidable difficulties in producing such a hybrid gene structure could not be surmounted at all by the combination of the existing common general knowledge and the disclosure in the patents. By contrast, the Court of Appeal found that it could be done, by a combination of the prior knowledge and the disclosure in the patents, but only so as to produce a hybrid gene structure with a small sub set of the 125 human V segments in the variable region (on the appellants estimate between two and six V segments), and an unspecified number of human D and J segments. Transplantation of the whole of the human variable region into a hybrid gene structure has since been achieved but only with the benefit of further inventive processes not forming part of the disclosure of the patents or the prior article The name given to this type of hybrid gene structure, containing the murine constant region and all or part of the human variable region is the Reverse Chimeric Locus. Once created in the mouse genome, it operated as the code for the production of a variety of hybrid antibodies which, when the B cells which contain the relevant coding are isolated and removed, could then have the murine constant regions removed and replaced with human equivalents before mass production and use in humans for therapy. The Patents in Issue The foregoing bare outline of the technical background makes it possible to understand the relevant claims of the patents in issue, to the limited extent necessary for the resolution of the single issue of law before this court. The dispute relates to two patents obtained by the respondent, Regeneron Pharmaceuticals Inc, each with a priority date of 16 February 2001, and each with substantially the same disclosure for the purpose of justifying different claims. They are European Patent (UK) No 1 360 287 (the 287 Patent) and European Patent (UK) No 2 264 163 (the 163 Patent). The 163 Patent is a divisional of the 287 Patent. The challenge to validity arose because Regeneron alleged infringement by Kymab Ltd of claim 1 in the 163 Patent and claims 5 and 6 of the 287 Patent by the offer to the pharmaceutical industry of its own Kymouse, a transgenic mouse with a Reverse Chimeric Locus some of which included the whole of the human variable segments in both the heavy and the light chain loci. The judge found infringement proved, but that all three claims were invalid for insufficiency. It was common ground before this court that the outcome for the validity of all three claims turns on the validity of claim 1 of the 163 Patent (Claim 1), which reads as follows: A transgenic mouse that produces hybrid antibodies containing human variable regions and mouse constant regions, wherein said mouse comprises an in situ replacement of mouse VDJ regions with human VDJ regions at a murine chromosomal immunoglobulin heavy chain locus and an in situ replacement of mouse VJ regions with human VJ regions at a murine chromosomal immunoglobulin light chain locus. This is of course a product claim, seeking a monopoly for the making (at first sight a strange but serviceable word to use of an animal) of a genetically engineered mouse having the characteristics described in the claim. The characteristics related both to what such a mouse does (namely produce the hybrid antibodies described) and to what is contained in its genome, namely the Reverse Chimeric Locus, achieved by a process of in situ replacement of the murine variable regions in both the light and heavy chain gene loci with the corresponding but of course different human variable regions. The claim seeks protection for the making and exploitation of any type of mouse having those characteristics. Since the description of what the mouse does is more loosely worded than the description of what lies within its genome, it is the latter description which mainly controls the breadth of the claim. All issues as to the construction of Claim 1, ie as to what it means, were resolved in the courts below, and none are subject to appeal in this court. There were, for example, issues as to the meaning of in situ replacement, which no longer matter. But there was a more important issue about whether Claim 1 described a single type of mouse or a range of types which the courts below also resolved, in favour of the range, arising from the meaning of the phrase with human VDJ regions in the heavy chain locus, and the phrase with human VJ regions in the light chain locus. Did this mean (only) all the segments in the VDJ and VJ regions, or did it include any of them? Looking at the V segments, did this capture only a mouse with all 125 human V segments, or also a mouse with only one such segment, and therefore mice with any number of V segments between one and 125? Both the judge and the Court of Appeal concluded that the quoted phrase meant both all and any. It was this interpretation which led them both to conclude that Claim 1 extended to a range of qualifying types of mice, rather than to a single type. Taking the V segments in the heavy chain locus as the best example, the range was denominated by reference to the number, between one and 125, of the human V segments introduced into the mouses genome as part of the human variable region. The conclusion that Claim 1 sought to protect the making of a range of transgenic mice was not in dispute on this appeal, even though every type (or embodiment) within the range would necessarily have a form of Reverse Chimeric Locus as part of its genome. The fact that there is such a range is the foundation for the agreed identification of the legal issue before this court, since the question, as framed above, makes no sense if there is not a relevant range with different types or embodiments within it. There was nonetheless a sharp difference in this court between the parties submissions on the relevance or otherwise of the existence of this range to the question of sufficiency. For the appellant it was submitted that the range was of the highest importance because of its effect upon the ability of a particular type of mouse to produce a wide variety of B cells, and hence its potential to deliver a broad stream of useful antibodies. A mouse fitted with only (say) four V segments from the human variable region gene locus would produce only a small fraction of the variety of B cells that would be produced by a mouse fitted with the entire 125 V segments in the human variable region gene locus. That at least (as the judge found) was the assumption made by the skilled person as at the priority date, even though research and development since 2001 have called into question to some extent the assumption that the full range of 125 V segments is necessary to optimise the desirable combinatorial possibilities needed for there to be a reasonable prospect of delivery of useful antibodies. For the respondent it was submitted that the existence of this range was irrelevant, because the unique advantage conferred by the use of a Reverse Chimeric Locus, namely a cure for the immunological sickness of the recipient mouse, worked across the whole range, regardless of the amount of the human variable region DNA inserted into the murine genome, because it was the product of the retention in the hybrid gene structure of the murine constant region genes. In a functional sense, both these submissions are to an extent literally true, on the facts found by the courts below. The amount of human variable region DNA inserted into the murine genome does substantially affect the usefulness of the mouse fitted with the Reverse Chimeric Locus as (to use the judges summary) a platform for therapeutic antibody discovery. More to the point that was the general understanding at the time of the priority date, and the patents in issue did not teach the contrary. But the ground breaking invention encapsulated and disclosed in the Reverse Chimeric Locus would (and eventually did) deliver a solution to murine immunological sickness across the whole of the range captured by Claim 1, making all of them better platforms than mice which had (as previously) been fitted with fully human antibody gene structures. That analysis does not of itself lead to a conclusion that the range which is denominated by reference to the amount of human variable segments in the hybrid gene structure is irrelevant, for sufficiency purposes. One can imagine an obviously irrelevant range, such as mice which are large and small, of differing colours, or having tails of varying length. No one would say that Claim 1 fails for insufficiency because it includes mice with very short tails (which it does) merely because it does not teach how to make such mice. The quality and diversity of the stream of antibodies which the mouse exists to produce is, so far as is known, wholly unaffected by the length of its tail. The question whether the range denominated by the amount of human segments in the variable region within the Reverse Chimeric Locus is relevant for sufficiency purposes is best answered from the terms of Claim 1 itself. The claim is to mice which produce a stream of antibodies with human variable regions, and the disclosure more generally shows that this stream is for eventual use (after further engineering and mass production) in treating disease in humans. True it is that the particular ground breaking contribution achieved by the invention of the Reverse Chimeric Locus is the delivery of a means of preventing (or greatly reducing) murine immunological sickness, to which the range of embedded human variable segments is irrelevant, but murine immunological health is not an end in itself. It is a means to a different end. Sufficiency the Basic Principle Sufficiency is one of the established tools by which is measured the correspondence, or lack of it, between the protection afforded by the claim and the technical contribution to the art made by the disclosure of the invention in the patent. The other main tools are novelty, inventive step and industrial application: see Actavis Group PTC EHF v ICOS Corpn [2019] UKSC 15; [2019] Bus LR 1318, para 57 per Lord Hodge. The essence of the bargain between the patentee and the public is that the patentee dedicates the invention to the public by making full disclosure of it, in return for a time limited monopoly over its use. The benefit afforded to the public is not merely the disclosure, but the ability to work the invention after the expiry of the monopoly by the use of the disclosure. Where the invention enables patentees to make a particular product, and they seek a monopoly over the making and exploitation of the product (which is what a product claim does), they must disclose enough in the teaching of the patent to enable the public also to make the product. In that context work the invention means make the product: see Generics (UK) Ltd v H Lundbeck A/S [2008] EWCA Civ 311; [2008] RPC 19, para 30 per Lord Hoffmann. If the patentee were able to obtain a product monopoly without disclosing how to make the product, the public would get nothing of substance in return for the grant of the monopoly. Furthermore, other inventors would be deterred from conducting the research and development in fact necessary to take advantage of the inventive idea for the benefit of society as a whole, since during the period of the monopoly they could derive no benefit from their own inventiveness. Similar basic principles apply to the patenting of processes, but such distinctions as there may be do not call for examination here. Disclosure does not, of course, have to enable the product to be made by any member of the public, or solely by using the teaching in the patent. The law creates, distinctly for each patent under scrutiny, a notional skilled person or (as here) skilled team who must be enabled to make the product by the combination of the teaching in the patent, the general technical knowledge available at the priority date, and a reasonable (ie not burdensome) element of experimentation. But the skilled person is not expected to be inventive or even, as is sometimes said, imaginative: see Rockwater Ltd v Technip France SA [2004] RPC 46, paras 7 and 10 per Jacob LJ. Sufficiency Enablement across the Range Starting to apply those basic principles to the question before the court, is disclosure sufficient if the teaching in the patent enables only some but not all of the products within the claimed range to be made? Subject to de minimis exceptions, the instinctive answer would be: surely not. If in principle the patentee should be entitled to a monopoly only over the making of a product which the teaching in the patent enables the skilled person to make, why should not the same principle apply to every product type within the relevant range for which a monopoly is sought? The essential patent bargain is not satisfied in relation to products in that part of the range which cannot be made, using the teaching in the patent. This analysis may be tested by a simple example. Suppose that five types of product (types A to E) were all claimed to be more efficient or useful than their predecessors by the application to their manufacture of the same new invention. The patentee made separate claims in relation to each type, all supported by the same disclosure. Each claim would be subjected to the sufficiency test: could a product of that type be made by use of the teaching in the patent, coupled with the existing common general knowledge? Suppose that types A and B could but C, D and E could not. Then claims A and B would be valid, and the remainder invalid. But now suppose that all five types were covered by the more compendious wording of a single claim. Would this enable the patentee also to obtain a monopoly for the making of types C, D and E? Surely not. The Court of Appeal did not doubt this analysis as a general rule, but concluded that it would defeat the implementation of the essential patent bargain if applied to a case in which the invention amounted to a principle of general application, which would yield the relevant increase in efficiency or usefulness across a range of potential product types if they incorporated the invention, as and when they could be made, even if only a few could be made as at the priority date by using the teaching in the patent. In bare outline their reasoning was as follows. The patent bargain requires that the reward given to the patentee should be commensurate with the contribution which the invention makes to the article An invention which consists of a new generally applicable principle may contribute to the art by its use, not only in products which can currently be made, but equally in products which will only be capable of being made in the future, after further inventive research and development. To limit the patentee strictly to a monopoly over the products which can immediately be made would be to deprive the patentee of any reward for the public benefit which will be derived from the use of that same invention in future types of product. In a fast moving field, where new products quickly outperform their predecessors so as to render them obsolete, the reward of a monopoly limited to those immediately capable of being made would be short lived and illusory. Accordingly the invention should be regarded as sufficiently enabled across the range if it can be seen that it will in due course benefit all products in the range, provided that, as at the priority date, the teaching in the patent enables at least one type to be made immediately. Since the Reverse Chimeric Locus would be likely to deal with murine immunological sickness in mice whose genomes were fitted with all or any amount of the human variable segments, up to and including the whole of the human variable region, its invention was one of those principles of general application which should be regarded as enabled across the whole range contemplated by Claim 1. A monopoly over the making and exploitation of the whole range would correspond with the contribution made by the Reverse Chimeric Locus to the article This is a sophisticated and internally logical process of reasoning, which certainly would tend to increase the rewards obtainable by inventors in a complex, rapidly developing field like genetic engineering for use in treatment of disease. The question is whether it is part of the law or, perhaps, a legitimate development of it. The requirement for sufficiency is now enshrined in article 83 of the EPC as follows (in its English version): The European patent application shall disclose the invention in a manner sufficiently clear and complete for it to be carried out by a person skilled in the article This is replicated in section 14(3) of the Patents Act 1977 as follows: The specification of an application shall disclose the invention in a manner which is clear enough and complete enough for the invention to be performed by a person skilled in the article Article 100(b) of the EPC makes it a ground of opposition that: the European patent does not disclose the invention in a manner sufficiently clear and complete for it to be carried out by a person skilled in the art; This is reflected in section 72(1)(c) of the Act which provides as a ground for revocation that: the specification of the patent does not disclose the invention clearly enough and completely enough for it to be performed by a person skilled in the article By section 130(7) of the Act, provisions including section 72(1): are so framed as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the European Patent Convention, the Community Patent Convention and the Patent Co operation Treaty have in the territories to which those Conventions apply. Those terse statements of the sufficiency requirement in articles 83 and 100(b) of the EPC and in sections 14(3) and 72(1)(c) of the Act offer no particular illumination in the present debate. Rather the answer is to be found in the European and UK authorities on sufficiency, which were subjected to intensive review both by the Court of Appeal and in submissions to this court. The interpretative objective is to strive for consistency between European and UK patent law: see Generics (UK) Ltd v H Lundbeck A/S [2009] RPC 13, para 86 per Lord Neuberger of Abbotsbury. A chronological review of the relevant decisions of the Technical Board of Appeal of the European Patent Office (EPO) begins with Unilever/Stable Bleaches (T 226/85) ECLI:EP:BA:1987:T022685.19870317, decided in March 1987. The appeal included opposition on the ground of insufficiency. At para 2 the Board provided this general summary of the sufficiency requirement: An attack on the ground of insufficiency under article 100(b) EPC is, of course, based on article 83 EPC which requires that the disclosure of the invention must be sufficiently clear and complete for it to be carried out by the person skilled in the article It is understood that this means that substantially any embodiment of the invention, as defined in the broadest claim, must be capable of being realised on the basis of the disclosure. That case was not specifically about a claim for a range of products, or an assertion that the invention disclosed a generally applicable principle. But such a claim and assertion were directly in issue in Exxon/Fuel Oils (T 409/91) EP:BA:1993:T040991.19930318, decided in March 1993. This has come to be seen as the leading case on the subject of sufficiency across a range. In Generics v Lundbeck (supra) at para 21 Lord Walker of Gestingthorpe described the requirement that the invention be enabled across the whole of the claim as the Exxon principle. At certain temperatures, wax crystals suspended in diesel fuel tend to clog fuel filters in diesel engines. Exxon claimed a monopoly over fuel oils which, within specified temperatures, had wax crystals having an average particle size of less than 4,000 nm. This was challenged on the basis that the claimed range was from 1 nm to 3,999 nm, but the teaching in the patent did not enable fuel oil to be produced (by the insertion of additives) with a wax crystal size below 1,000 nm. This was a relevant range because the smaller the crystal the more easily it would pass through a filter. The sufficiency challenge was eventually met by amending the claim to exclude crystal size below 1,000 nm (although it still failed for other reasons, under article 84 of the EPC). But Exxon sought to defend the claim by asserting that the invention embodied a general principle, applicable across the whole claimed range, that small crystals do not clog filters. Prior to amendment of the claim the sufficiency challenge was upheld, in these terms, at para 2: In other words, in the present case there is absolutely no doubt that all these claims must be so construed as to relate to fuel oils containing wax crystals smaller than 1,000 nanometres. The appellant has admitted that no way of obtaining such fuel oils was disclosed or could be found in the body of relevant common general knowledge. However, in the Boards judgment, in order to fulfil the requirement of article 83 EPC, the application as filed must contain sufficient information to allow a person skilled in the art, using his common general knowledge, to carry out the invention within the whole area that is claimed. Later, at para 3.5, the sufficiency requirement was defined as meaning that: the disclosure of the claimed invention is only sufficient if it enables the skilled person to obtain substantially all embodiments falling within the ambit of the claims At para 3.6 the Board directly addressed the submission that the invention disclosed a general principle, and decided that, even if it did, that made no difference. They said that the claim must fail: regardless of whether or not the alleged principle to avoid the so called cold filter plugging (or clogging) by reducing the size of the wax crystals would be novel and inventive. Despite the very different subject matter there is an obvious similarity between the claimed range in the Exxon case (wax crystals from 3,999 nm down to 1 nm) and the claimed range in the present case (from all the segments in the human variable region locus down to just one V, D and J segment in the heavy chain locus and one V and J segment in the light chain locus). Although the lower the better in Exxon contrasts with the higher the better in the present case, it is a feature of both cases that the invention was not enabled by the disclosure in the patent at the more beneficial end of the range. It is noteworthy that the descriptions of the sufficiency requirement in these EPO cases use the adverb substantially to qualify the strictness of the requirement, meaning that it is a requirement of substance, which may on a de minimis basis still be satisfied where there are or may be a tiny or inconsequential number of embodiments which are not enabled. But the enablement shortfall in the present case is, as already explained, much greater than anything which could be saved by that qualification. In Unilever/Detergents (T 435/91) ECLI:EP:BA:2008, decided in March 1994, the Board described the requirement that the invention be enabled across the whole of the claim as a rule of general application to all inventions, as follows: In the Boards judgment the criteria for determining the sufficiency of the disclosure are the same for all inventions, irrespective of the way in which they are defined, be it by way of structural terms of their technical features or by their function. In both cases the requirement of sufficient disclosure can only mean that the whole subject matter that is defined in the claims, and not only a part of it, must be capable of being carried out by the skilled person without the burden of an undue amount of experimentation or the application of inventive ingenuity. The Board shed some useful light on what the specification in a patent must do if it is to qualify as a general principle which enables an invention across a broad claim. It must disclose: a technical concept fit for generalisation which makes available to the skilled person the host of variants encompassed by the respective functional definition of the . claim. A similar analysis of the contribution which a general concept may make to sufficiency across a range is to be found in Mycogen/Modifying plant cells (T 694/92) ECLI:EP:BA:1996, decided in May 1996, at p 19. The key for present purposes is that the general concept or principle must actually make the embodiments within the claim available. It is not enough for the general inventive concept or principle to make all those variants, if and when they become available, fit or better than their predecessors for beneficial or efficient use. Henry Carr J had this well in mind when he said in the present case (at para 257): I do not accept that all embodiments within the claim are unified by a single principle of a reverse chimeric locus. This is not a principle that enables the method to be performed, rather it is the result of successfully carrying out the method. He was speaking mainly of process rather than product claims at that point, but the principle is the same for both. In relation to Claim 1 he could equally have said that the Reverse Chimeric Locus was not a principle that enables the products to be made, rather it is the result of successfully making the products. Lord Pannick QC, Adrian Speck QC and Justin Turner QC for the respondent relied on three EPO cases which, they submitted, supported the Court of Appeals analysis in the present case. The earliest, Genentech I/Polypeptide expression (T 292/85) ECLI:EP:BA:1988, was decided in January 1988. The Board upheld a patent claiming processes and resulting products which produced a uniform stream of specified polypeptides by the use as input components of a range of bacteria, plasmids and regulons, wide enough to embrace types which had yet to be made available under the then state of the article The Examining Division had rejected the patent because, in its view, the specification did not enable embodiments containing such future input components to be made. The Board of Appeal stated, to the contrary: 3.1.2 There is, however, in the opinion of the Board, no such requirement in the European Patent Convention, nor is such principle established in normal patent practice within the Contracting States. The suggested features in the claims are essentially functional terms in this particular context, in spite of structural connotations, and may cover an unlimited number of possibilities. It follows that the features may generically embrace the use of unknown or not yet envisaged possibilities, including specific variants which might be provided or invented in the future. The Board continued: In appropriate cases, such as the present, it is only possible to define the invention (the matter for which protection is sought article 84 EPC) in a way which gives a fair protection having regard to the nature of the invention which has been described, by using functional terminology in the claims. 3.1.3 What is also important in the present case is the irrelevancy of the particular choice of a variant within the functional terms bacteria, regulon or plasmid. It is not just that some result within the range of polypeptides is obtained in each case but it is the same polypeptide which is expressed, independent of the choice of these means . 3.1.5 Unless variants of components are also embraced in the claims, which are, now or later on, equally suitable to achieve the same effect in a manner which could not have been envisaged without the invention, the protection provided by the patent would be ineffectual. Thus it is the view of the Board that an invention is sufficiently disclosed if at least one way is clearly indicated enabling the skilled person to carry out the invention. At first sight, and taken out of context, (for which see paras 42 and 53 below) the first and last of those quoted passages might appear to provide powerful support for the respondents case. But an attempt to rely upon them for a similar purpose was made and firmly rejected in Unilever/Detergents (T 435/91). At pp 10 11 the Board said: In particular, it is not adequate to take the finding in point 3.1.5 of Decision T 292/85 (OJ EPO 1989, 275) out of its context. It is not only stated there, as quoted by the respondent, that an invention is sufficiently disclosed if at least one way of carrying out the invention is clearly indicated enabling the skilled person to carry out the invention, but in the next sentence it is made clear that any non availability of some particular variants of a functionally defined component feature of the invention is immaterial to sufficiency as long as there are suitable variants known to the skilled person through the disclosure or common general knowledge which provide the same effect for the invention . Moreover, in respect of the functional expression suitable bacterium it was pointed out that the applicability of the claimed method to any kind or most species of bacteria has not been effectively challenged. Similar findings of fact concerned the remaining functional definitions in the considered claim Unilever/Detergents was one of the EPO cases cited above where the requirement that the specification should enable all embodiments across the whole range of the claim was firmly asserted. The Board plainly did not regard that requirement as necessitating any departure from the decision in the Polypeptide case although, if such a departure was the only way of reconciling them, the law ought now to be taken as laid down by the Detergents case and by the Exxon case which applied the requirement to facts closely allied with those of the present case. But the Polypeptide and Detergents cases can be reconciled. In the former the claims were (necessarily in the Boards view) framed by reference to function, and sought to protect products and processes which in fact achieved that function when applied to a broad range of input variables, none of which were themselves embodiments of the claim. In the Detergents case (as the headnote explains) the claim was again made by reference to function, but the patent failed to disclose any general technical principle by which the skilled person could achieve the desired result across the whole range of claimed embodiments. Furthermore the range of the input variables which could be used to work the invention in the Polypeptide case was held to be irrelevant. For reasons already explained, Claim 1 in the present case is of the kind which falls within the Detergents and Exxon line of EPO authority. Mention should briefly be made of two EPO decisions which followed and applied the Polypeptide case. The first, decided in June 1988, is Nabisco/Micro organisms (T 361/87) ECLI:EP:BA:1988. A claim to protect a means of preparing fructose was challenged for sufficiency on the ground that a certain type of input variable falling within the claim only became available to persons skilled in the art after the priority date. The challenge was rejected in part by application of the cited passage in the Polypeptide case, but also because the description contained sufficient teaching to enable the invention to be used with that new input element, once available. The decision takes the matter no further for the purposes of the present case than does the Polypeptide case. The second, more recent, case is Novartis II/Transgenic plant (G 1/98) ECLI:EP:BA:1999, decided by the Enlarged Board in December 1999. The decision makes brief reference to both the Polypeptide and Nabisco cases as demonstrating that the requirement that the claim be enabled across the full range of the claim is not without exception. Save that it suggests that those earlier cases should not simply be regarded as having been overruled by the Detergents and Exxon line of EPO authority, it sheds little further light on the necessary distinction between the two. Reference was also made to the decision of the German Federal Supreme Court in Dipeptidyl Peptidase Inhibitoren (X ZB 8/12). It was about a medical use patent, rather than a product claim. It sought to protect a method of using a range of known substances for lowering the blood glucose level in mammals, in a manner which would be simple, cost efficient and not too burdensome on the patient, by comparison with methods already known. As in the Polypeptide case it was held not to be fatal to the validity of the patent that it applied to a range of known input substances and extended to substances not yet available. Neither the outcome nor the language used by the court (at paras 19 20) takes the matter any further than either the Polypeptide or Nabisco cases, when read in the context of a medical use claim. It is convenient at this point to explain why the present case falls on the Detergents/Exxon side of this line. The reason why Claim 1 fails to enable the skilled person to make mice with Reverse Chimeric Loci across the whole range of the human variable regions of the hybrid antibody gene structure is not because any of the V, D and J segments had yet to be discovered or mapped by the priority date, or even because any of them could not be inserted into mice. The whole of the human variable region gene locus had already been mapped. It could be (and had been) inserted into mice, but only when attached to the human constant region genes, thereby causing murine immunological sickness. The problem facing those skilled in the art at the priority date was that there was no known way, even using the teaching in the patents, to combine more than a very small part of the human variable region gene locus with the endogenous murine constant region gene locus, in the same hybrid gene structure. It took several years, and significant further inventive steps, before methods were developed sophisticated enough to accommodate the whole of the human variable and murine constant region genes in a single hybrid gene structure. Thus the inventive shortfall at the priority date lay not in the range of possible inputs to which the invention could be applied, but in the inability to create a Reverse Chimeric Locus involving the whole (or anything more than a very small part of) the human variable region. It was truly a shortcoming in the invention itself, which, as at the priority date, limited its use to only a small part of the relevant range within the scope of Claim 1. In sharp contrast the inventions in the Polypeptide line of cases did disclose a sufficient general principle which, without any further inventive step, would enable the skilled person to work the relevant invention by using, as input elements, examples of those components described generally in the claims, which were unavailable as at the priority date, in order to make products across the scope of the claim. The fact that the claim permitted alternative examples of input elements, as yet unavailable at the priority date, is the exception to the requirement for enablement across the whole scope of the claim to which the Enlarged Board made brief reference in the Novartis II decision. A study of the relevant UK cases reveals a similar approach to the existence and nature of this exception to the Exxon principle. The earliest, and perhaps best known, are the decisions of the Court of Appeal and the House of Lords in Biogen Inc v Medeva plc [1995] RPC 25 and [1997] RPC 1. It was, like the present, a case about genetic engineering, but the claim sought to protect a genetic molecule rather than a whole mouse. The claim was that the molecule would, if inserted into a suitable host cell, cause the cell to make antigens of the Hepatitis B virus. Both the Court of Appeal and the House of Lords held that the claim failed, inter alia for insufficiency, but for different reasons. Apart from the holding that sufficiency is to be tested as at the priority date (a rule which is not in dispute in this appeal) the case is of importance for present purposes only because of the reliance placed by the parties on different dicta by Hobhouse LJ (in the Court of Appeal) and Lord Hoffmann (in the House of Lords) about the sufficiency requirement and the principles of UK law to be derived from the main EPO decisions cited above. It is, again, important not to take the dicta out of context. In the Court of Appeal Hobhouse LJ addressed the submission, accepted by the trial judge, that the sufficiency requirement was satisfied whenever the patentee demonstrated that the invention enabled one embodiment of the claimed range to be made. Having cited extensively from the Exxon case, and held that it correctly represented UK law, he continued, at pp 98 99: The disclosure must be sufficient to enable the whole width of the claimed invention to be performed. What will suffice to satisfy this criterion will vary depending upon the nature of the claim that has been made. It is essential to apply the test having regard to the extent of the claim. It is not the law that the disclosure of a single embodiment will always satisfy the requirement regardless of the width of the claim. Having noted counsels attempt to limit his submission to cases where the patent related to the invention of a principle, he continued: The disclosure must be wide enough to enable the man skilled in the art to perform the claimed invention across its full width not just by reference to one type of antigen or one type of host. The plaintiff had a choice as to how widely it would draw its claim. If it chose to draw it widely, it must accept the co relative obligation to make a correspondingly wide disclosure. If it is unable to make that disclosure, that shows that it is seeking to claim an invention to which it is not entitled. In the House of Lords Lord Hoffmann described the submission that enablement of a single embodiment was sufficient (rejected by Hobhouse LJ) as having originated from a misunderstanding of the meaning of the Polypeptide case by Aldous J (who was the trial judge in Biogen) in Chiron Corpn v Organon Teknika Ltd (No 3) [1994] FSR 202. At pp 48 49 he set out his own understanding of the Polypeptide case as follows: In other words, the applicants had invented a general principle for enabling plasmids to control the expression of polypeptides in bacteria and there was no reason to believe that it would not work equally well with any plasmid, bacterium or polypeptide. The patent was therefore granted in general terms. He continued: In fact the Board in Genentech I/Polypeptide expression was doing no more than apply a principle of patent law which has long been established in the United Kingdom, namely, that the specification must enable the invention to be performed to the full extent of the monopoly claimed. If the invention discloses a principle capable of general application, the claims may be in correspondingly general terms. The patentee need not show that he has proved its application in every individual instance. On the other hand, if the claims include a number of discrete methods or products, the patentee must enable the invention to be performed in respect of each of them. Thus if the patentee has hit upon a new product which has a beneficial effect but cannot demonstrate that there is a common principle by which that effect will be shared by other products of the same class, he will be entitled to a patent for that product but not for the class, even though some may subsequently turn out to have the same beneficial effect: see May & Baker Ltd v Boots Pure Drug Co Ltd (1950) 67 RPC 23, 50. On the other hand, if he has disclosed a beneficial property which is common to the class, he will be entitled to a patent for all products of that class (assuming them to be new) even though he has not himself made more than one or two of them. He continued by treating the Exxon case as reinforcing the established principle of UK law which he had earlier described. In the event Lord Hoffmann decided that the patent failed for insufficiency because it disclosed only one method of working the invention, whereas there were other methods available to the skilled person. He did not disagree with Hobhouse LJs analysis of the law. At p 51 he concluded: This shows that there is more than one way in which the breadth of a claim may exceed the technical contribution to the art embodied in the invention. The patent may claim results which it does not enable, such as making a wide class of products when it enables only one of those products and discloses no principle which would enable others to be made. Or it may claim every way of achieving a result when it enables only one way and it is possible to envisage other ways of achieving that result which make no use of the invention. (my underlining) Both the Court of Appeal and the respondent in the present case placed great emphasis on the reference by Lord Hoffmann to a common principle by which products in a class may share the same beneficial effect, as if this was separate and additional to the case of a general principle which enables a whole class of products to be made. He did so by reference to the May & Baker Ltd v Boots Pure Drug Co Ltd (1950) 67 RPC 23 case, where a beneficial therapeutic effect was said to be of the essence of the claim. But the case before him and the submission with which he was dealing were all about the question whether the disclosure needed to enable all, or only some, of the embodiments of a claimed range to be made, as he acknowledged in the last of the passages quoted (and underlined) above. In Kirin Amgen Inc v Hoechst Marion Roussel Ltd [2005] RPC 9, the trial judge had cited Lord Hoffmanns concept of a general principle of beneficial effect in Biogen. Lord Hoffmann commented, at p 202 (para 112): This gave rise to a good deal of argument about what amounted to a principle of general application. In my opinion there is nothing difficult or mysterious about it. It simply means an element of the claim which is stated in general terms. Such a claim is sufficiently enabled if one can reasonably expect the invention to work with anything which falls within the general term. For example, in Genentech I/Polypeptide expression (T 292/85) [1989] OJ EPO 275, the patentee claimed in general terms a plasmid suitable for transforming a bacterial host which included an expression control sequence to enable the expression of exogenous DNA as a recoverable polypeptide. The patentee had obviously not tried the invention on every plasmid, every bacterial host or every sequence of exogenous DNA. But the Technical Board of Appeal found that the invention was fully enabled because it could reasonably be expected to work with any of them. Lord Hoffmanns reference to the Polypeptide case as an example shows that he was not thinking in terms of general beneficial effect. By reasonably expect the invention to work in relation to a product claim he meant reasonably expect the product to be able to be made. This is clear from dicta of his, sitting in the Court of Appeal, in the third of the UK cases, Generics (UK) Ltd v H Lundbeck A/S [2008] RPC 19. Two product claims were rejected by the trial judge for insufficiency, because the patent disclosed only one of a number of methods of making the products, following Biogen. Lord Hoffmann, with whom Jacob and Smith LJJ agreed, reversed him. At paras 29 30 he said: In order to decide whether the specification is sufficient, it is therefore first necessary to decide what the invention is. That must be found by reading and construing the claims, in which the inventor identifies what he claims to be his invention. As the Board of Appeal of the European Patent Office said in Exxon/Fuel Oils (T 409/91) [1994] OJ EPO 653, para 3.3, It is the definition of the invention in the claims that needs support. Section 60(1) of the Act makes it clear that a claim may be either to a product or a process. In the case of a product claim, performing the invention for the purposes of section 72(1)(c) means making or otherwise obtaining the product. In the case of a process claim, it means working the process. A product claim is therefore sufficiently enabled if the specification discloses how to make it. There is nothing to say that it must disclose more than one way. At paras 34 36 he continued: Thus, as a matter of construction, the House of Lords interpreted the claim as being to a class of products which satisfied the specified conditions, one of which was that the molecule had been made by recombinant technology. That expression obviously includes a wide variety of possible processes. But the law of sufficiency, both in the United Kingdom and in the EPO, is that a class of products is enabled only if the skilled man can work the invention in respect of all members of the class. The specification might show that this has been empirically demonstrated or it might disclose a principle which can reasonably be expected to apply across the class: see T 292/85 Polypeptide expression/Genentech [1989] OJ EPO 275; T 409/91 Exxon/Fuel Oils [1994] OJ EPO 653; Kirin Amgen Inc v Hoechst Marion Roussel Ltd [2005] RPC 9, para 112. But the specification in Biogen described only one method of making the molecule by recombinant technology and disclosed no general principle. It was easy to contemplate other methods about which the specification said nothing and which would owe nothing to the matter disclosed. In my opinion, therefore, the decision in Biogen is limited to the form of claim which the House of Lords was there considering and cannot be extended to an ordinary product claim in which the product is not defined by a class of processes of manufacture. It is true that the House in Biogen endorsed the general principle stated by the Board of Appeal in Exxon/Fuel Oils (T 409/91) [1994] OJ EPO 653, that: the extent of the patent monopoly, as defined by the claims, should correspond to the technical contribution to the art in order for it to be supported or justified. The judge said that in holding claim 1 insufficient, he was applying this principle. But then he treated the relevant technical contribution to the art as being the inventive step, namely a way of making the enantiomer. That, I respectfully consider, was a mistake. When a product claim satisfies the requirements of section 1 of the 1977 Act, the technical contribution to the art is the product and not the process by which it was made, even if that process was the only inventive step. The House of Lords dismissed the appeal. Lord Walker placed emphatic reliance upon the Exxon case as the leading statement of the law on sufficiency in relation to a product claim. At para 20 he said: The disclosure must be such as to enable the invention to be performed (that is, to be carried out if it is a process, or to be made if it is a product) to the full extent of the claims. Analysis Reflection upon those European and UK authorities yields the following principles: i) The requirement of sufficiency imposed by article 83 of the EPC exists to ensure that the extent of the monopoly conferred by the patent corresponds with the extent of the contribution which it makes to the article ii) In the case of a product claim, the contribution to the art is the ability of the skilled person to make the product itself, rather than (if different) the invention. iii) Patentees are free to choose how widely to frame the range of products for which they claim protection. But they need to ensure that they make no broader claim than is enabled by their disclosure. iv) The disclosure required of the patentee is such as will, coupled with the common general knowledge existing as at the priority date, be sufficient to enable the skilled person to make substantially all the types or embodiments of products within the scope of the claim. That is what, in the context of a product claim, enablement means. v) A claim which seeks to protect products which cannot be made by the skilled person using the disclosure in the patent will, subject to de minimis or wholly irrelevant exceptions, be bound to exceed the contribution to the art made by the patent, measured as it must be at the priority date. vi) This does not mean that the patentee has to demonstrate in the disclosure that every embodiment within the scope of the claim has been tried, tested and proved to have been enabled to be made. Patentees may rely, if they can, upon a principle of general application if it would appear reasonably likely to enable the whole range of products within the scope of the claim to be made. But they take the risk, if challenged, that the supposed general principle will be proved at trial not in fact to enable a significant, relevant, part of the claimed range to be made, as at the priority date. vii) Nor will a claim which in substance passes the sufficiency test be defeated by dividing the product claim into a range denominated by some wholly irrelevant factor, such as the length of a mouses tail. The requirement to show enablement across the whole scope of the claim applies only across a relevant range. Put broadly, the range will be relevant if it is denominated by reference to a variable which significantly affects the value or utility of the product in achieving the purpose for which it is to be made. viii) Enablement across the scope of a product claim is not established merely by showing that all products within the relevant range will, if and when they can be made, deliver the same general benefit intended to be generated by the invention, regardless how valuable and ground breaking that invention may prove to be. Application of those principles to the facts of the present case shows clearly that Claim 1 fails for insufficiency. At the priority date the disclosure of the two patents, coupled with the common general knowledge, did not enable transgenic mice to be made with a Reverse Chimeric Locus containing more than a very small part of the human variable region gene locus. The extent to which that variable region of the human antibody gene structure could be included in the hybrid antibody gene structure was, at that date, understood to be a very important factor affecting the diversity of useful antibodies capable of being discovered by the use of transgenic mice, so that the range thus denominated was a relevant range for sufficiency purposes, even though it did not affect the immunological health of the transgenic mouse. Thus the claim to a monopoly over the whole of that range went far beyond the contribution which the product made to the art at the priority date, precisely because mice at the more valuable end of the range could not be made, using the disclosure in the patents. A comparison between those principles and those applied by the Court of Appeal reveals that they did not correctly apply the law as it stands, for the following reasons. First, I cannot accept their summary of the essential patent bargain. In the case of a product claim, the contribution to the art is the product which is enabled to be made by the disclosure, not the invention itself. Patents are about products and processes, not pure ideas. Secondly, I do not accept their conclusion that an invention may be enabled in relation to a particular type of product falling within the scope of the claim even if it does not permit the skilled person to make it. They thought it was enough that the benefits which the invention unlocked (in terms of preventing murine immunological sickness) would in due course be realised over the whole range, if and when all embodiments within the range could be made. In practical terms they upheld a monopoly over that part of the range of products answering the broad description in Claim 1 which was likely to be of most benefit to medical genetic engineering, at a time when the disclosure in the patent only enabled the skilled person to make products over a very small part of the range, and at the least beneficial end of the range denominated by the amount of the human variable region gene locus incorporated in the hybrid gene structure. It is now known that the type of mouse fitted with a Reverse Chimeric Locus which actually does serve as the gold standard in the art has the whole of the human variable region gene locus as part of its hybrid antibody gene structure. Yet the Court of Appeal would have upheld a monopoly for its manufacture and exploitation when the disclosure in the patent, coupled with the common general knowledge, would not have enabled a skilled person to make such a mouse at all. The ability of both the appellant and the respondent to make such a mouse now depends upon further (and different) inventions separately made by each of them some years after the priority date. Nor is the Court of Appeals analysis to be regarded as a legitimate development of the law. The sufficiency requirement, namely that the disclosure in the patent should enable substantially all products within the scope of a product claim to be made by the skilled person as at the priority date, is part of the bedrock of the law, worked out over time both in the UK and by the EPO, which is essential to prevent patentees obtaining a monopoly which exceeds their contribution to the article To water down that requirement would tilt the careful balance thereby established in favour of patentees and against the public in a way which is not warranted by the EPC, and which would exceed by a wide margin the scope for the development of the law by judicial decision making in a particular Convention state. It may well be, as the Court of Appeal clearly thought, that the consequence of confining the patentee with a ground breaking invention to protection only over a range of products which the invention currently enables to be made at the priority date will give the patentee scant and short lived reward for their efforts and ingenuity, viewed in particular with the benefit of hindsight. The Court of Appeal put this point forcefully to counsel for Kymab at the hearing in October 2017, and the transcript discloses that little was said in response by way of mitigation. A little more was attempted in this court in the appellants reply, but it would not be a useful exercise to engage with it. What matters is that it is settled law, in relation to a product claim, that sufficiency requires substantially the whole of the range of products within the scope of the claim to be enabled to be made by means of the disclosure in the patent, and this both reflects and applies the principle that the contribution to the art is to be measured by the products which can thereby be made as at the priority date, not by the contribution which the invention may make to the value and utility of products, the ability to make which, if at all, lies in the future. I would therefore allow the appeal. LADY BLACK: (dissenting) I differ from the view of the majority and would have dismissed this appeal for reasons which I will set out shortly. I should first explain that, in what follows, in order to express myself as clearly as possible, I have at times consciously used simplified descriptions of the scientific concepts to which I need to refer. The issue raised by the appeal Lord Briggs says, at para 5, that the legal question that arises is whether a product patent, the teaching of which enables the skilled person to make some, but not all, of the types of product within the scope of the claim, passes the sufficiency test where the invention would contribute to the utility of all the products in the range, if and when they could be made. It is useful to bear in mind also how the issue was formulated by the parties in the Statement of Facts and Issues for this court, which was as follows: Is it a requirement for a valid patent under article 83 EPC that the description enables the skilled reader (at the date of the Patent) to make products across the whole scope of the claim, or is it enough that they could make products within only a limited part of that range, provided that all the products within the scope of the claim (if and when they could be made) would use the invention? The nature of the claims The Court of Appeal described claim 1 of the 287 patent as a method claim directed to the modification of an endogenous immunoglobulin heavy chain locus in a mouse ES cell such that murine V, D and J gene segments are replaced by human V, D and J segments and the locus produces hybrid antibodies containing human variable regions and mouse constant regions (para 114), the method having four steps as described in para 115. Claims 5 and 6 of the 287 patent were described as product by process claims (para 121). The issues in the appeal have been considered through the medium of claim 1 of the 163 patent, so it is worth setting that out again here. It is a claim to: A transgenic mouse that produces hybrid antibodies containing human variable regions and mouse constant regions, wherein said mouse comprises an in situ replacement of mouse VDJ regions with human VDJ regions at a murine chromosomal immunoglobulin heavy chain locus and an in situ replacement of mouse VJ regions with human VJ regions at a murine chromosomal immunoglobulin light chain locus. The Court of Appeal said of this claim that it is directed to a transgenic mouse in which there has been in situ replacement of mouse V, D and J regions on the heavy chain by human V, D and J regions; and in which there has been in situ replacement of mouse V and J regions on the light chain by human V and J regions (para 125). It then observed (para 126) that the claim contains no requirement that any particular size of DNA fragment is inserted or replaced; nor is there any limit to the number of steps by which the claim requirements may be met. Further, the reference to V, D and J regions must mean one or more V, D and J segments respectively. The Court of Appeal agreed with the judge that the claim was: not confined to a single product. It includes mice in which different amounts of mouse V, D and J regions (of the heavy chain) and mouse V and J regions (of the light chain) have been replaced with human V, D and J regions and V and J regions, respectively. So it includes, for example, a mouse in which one V, one D, and one J region (of the heavy chain) and one V and one J region (of the light chain) have been replaced and mice in which several such regions have been replaced. (para 127(i)) and that it: extends to a mouse in which the entire murine variable gene locus has been replaced with the entire human variable gene locus. (para 127(iv)) Henry Carr Js determination and how it fared in the Court of Appeal Henry Carr J made two key decisions which formed the foundation for the rest of his conclusions. First, he had to determine the proper construction of the claims in issue, in particular what was meant by in situ replacement in claim 1 of the 287 Patent. He accepted Regenerons proposed construction of the words, as did the Court of Appeal. No construction issue has been pursued before this court. Secondly, Henry Carr J had to make findings as to the feasibility of putting the invention into practice, which he did focussing specifically on claim 1 of the 287 Patent. He rejected the approaches proposed, for varying reasons, concluding that the whole subject matter defined in the claim was not capable of being performed at the priority date without undue burden and without invention (para 257). He considered that the difficulty did not relate to some hypothetical puzzle at the edge of the claim, but rather to the central disclosure of the specification, and the amounts of genetic sequence of which it contemplates the deletion and insertion. None of the methods disclosed would have worked, and the task could not have been achieved, if it could be achieved at all at the priority date, without a great deal of creative thinking. On appeal from the trial judge, Regeneron argued that it was in fact possible for a skilled team to have implemented the reverse chimeric locus without undue effort by means of minigenes. The Court of Appeal was persuaded that this was correct. It was satisfied that the use of minigenes was part of the common general knowledge, and said (para 200): In our judgment and given the idea of the reverse chimeric locus, it would have been obvious to the skilled team and technically feasible to produce a transgenic mouse that would produce hybrid antibodies containing human variable regions and mouse constant regions, and in which mouse V, D and J segments had been replaced with human V, D and J segments in the mouse immunoglobulin heavy chain gene locus, and mouse V and J segments had been replaced with human V and J segments in the immunoglobulin light chain gene locus. Given that it differed from Henry Carr J in this respect, the Court of Appeal inevitably had a different starting point for its consideration of the central legal issue of whether the claim was enabled across its whole scope. As the Court of Appeals finding of technical feasibility has not been challenged before us, we share the Court of Appeals starting point. But it is nevertheless important to note the following observation that Henry Carr J made at para 257, and to which Lord Briggs refers at para 38, with approval: I do not accept that all embodiments within the claim are unified by a single principle of a reverse chimeric locus. This is not a principle that enables the method to be performed, rather it is the result of successfully carrying out the method. The Court of Appeals determination of the enablement issue Having reviewed various decisions of the Technical Boards of Appeal of the EPO and of the domestic courts, the Court of Appeal turned at para 250 to the application of the law to the instant case. This involved, inter alia, a consideration of the nature and extent of the contribution to the art that the disclosure of the invention had made, which Regeneron submitted Henry Carr J had failed to appreciate properly. The Court of Appeal noted that the claim is drawn in general language and is of broad scope, but that: each of the mice it encompasses has the reverse chimeric locus, that is to say, it is a mouse which produces hybrid antibodies containing human variable regions and mouse constant regions, and in which mouse V, D and J segments have been replaced with human V, D and J segments at a chromosomal immunoglobulin heavy chain locus, and mouse V and J segments have been replaced with human V and J segments at a chromosomal immunoglobulin light chain locus. (para 254) It observed that the disclosure of the reverse chimeric locus was a major contribution to the art for it provided the answer to a significant problem which those working in the field had faced, namely that transgenic mice produced by conventional methods were immunologically sick [whereas those] with the reverse chimeric locus do not suffer from this deficiency (para 255). It proceeded to characterise the invention as a principle of general application, supporting that conclusion as follows (para 256): The character of this invention is therefore such that any transgenic mouse which falls within the scope of the claim and so produces hybrid antibodies containing the human variable regions and mouse constant regions will benefit from the technical contribution the disclosure of the 163 patent has made to the art, and will do so irrespective of the antigen which is used to challenge the mouse. The court then noted, at paras 257 to 259, that it was satisfied that the ability of the skilled team to implement the teaching of the 163 patent had been established. It was also noted that the mice produced would have had only a subset of the human V gene segments, although they would have had an immunological response close to that of wild type mice. The court continued (para 260): These points, taken together, strongly suggest to us that the 163 patent does disclose the invention clearly enough and completely enough for it to be performed by a person skilled in the article The character of the invention is one of general application. It applies to any mouse challenged with any antigen and the benefit it confers will be shared by every mouse falling within the scope of the claim. The skilled team would reasonably expect the invention to work across the scope of the claim and that expectation would be correct. What is more, there is nothing in the claim which could have been envisaged without the invention and, were protection to be limited to only those embodiments which could have been made at the priority date without undue effort, the protection provided by the patent would have rapidly become ineffectual. A further passage is of importance, taken from the following paragraphs in which the court examines the implications of it not being possible to perform, precisely, elements of what was described in the examples. In explaining why this did not render the patent insufficient, the court recalled that the law does not require a patentee to enable each and every embodiment of a claimed invention, but recognises that a claim may encompass inventive improvements of what is described and that a specification is not insufficient merely because it does not enable the person skilled in the art to make every such invention. It then continued (para 265): It is important, however, that any such improvement is still a way of working the original invention. In this case we have no doubt that this is the case: there is no mouse falling within the scope of claim 1 of the 163 patent which does not embody the reverse chimeric locus and enjoy the benefits it brings. Claim 1 of the 163 patent was therefore found not to exceed the contribution to the art which the disclosure of its specification made, the extent of the patent monopoly corresponding to the technical contribution and being adequately enabled across its scope (para 267). The 287 patent was seen to be subject to very similar considerations. Here too, the invention was found to be one of general application, being a methodology of making the reverse chimeric locus in which successful integrations using LTVECs are detected by using the MOA assay (para 272). Claims 1, 5 and 6 of that patent were also adequately enabled across its scope (paras 273 and 274). It is useful to note particularly what the Court of Appeal said, at the end of its judgment, in summarising what it saw as the reasons why its conclusion was different from that of the very experienced first instance patent judge. It seems to me that this short summary reveals what is at the heart of the Court of Appeals reasoning. It said: we are satisfied that, in assessing the sufficiency of the disclosure of the patents, [the judge] did not attach sufficient weight to the character of the invention as claimed in each of the claims in issue, the contribution that its disclosure made to the art and the need to confer a fair degree of protection on the patentee. (para 275) The approach of the majority in this court The majority in this court would allow the appeal, holding that the Court of Appeal failed to apply the law correctly and should have concluded that Regenerons claims failed for insufficiency. In essence, this is because the disclosure of the patents did not enable the making of a mouse which incorporated any more than a small part of the human variable region, yet claimed a monopoly including mice incorporating a far greater quantity of the human variable region. In the majoritys view, the claims therefore fail to satisfy the requirement that substantially the whole range of products within the scope of the claim be enabled. Discussion It is common ground between the parties, established in the authorities, and acknowledged in Lord Briggs judgment (see for example para 56(vi)), that an invention may disclose a principle of general application. It is also common ground between the parties (and again see Lord Briggs judgment at para 56(vi)) that there is no exception from the ordinary principles of enablement for such inventions; the invention must be enabled across its full scope, as with any other invention. It is when it comes to characterising this claim, determining what its scope is, and deciding whether it is enabled across that full scope that the argument arises. The claim is framed in terms of the mouse, specifying what it does (produces the hybrid human/mouse antibodies), and what it has in it (the reverse chimeric locus). As the trial judge said, and the Court of Appeal reiterated, it is not confined to a single product in that it includes mice in which different amounts of the mouse variable regions have been replaced, extending to a mouse with the entire murine variable region replaced with the entire human variable gene locus. It is the existence of this range of mice that leads the majority of my colleagues to conclude that, as only a limited amount of replacement was possible at the priority date, the claim was insufficient. But this was not the view of the Court of Appeal, and it is important to attempt to isolate the point at which the two approaches diverge. As I have already foreshadowed, it seems to me that there is little, if any, real disagreement with the Court of Appeals statement of the legal principles. It is in the application of them that the paths diverge. Lord Briggs says, at para 58, that the Court of Appeal did not correctly apply the law as it stands, having failed to recognise that the contribution to the art is the product which is enabled to be made by the disclosure, not the invention itself, and having erroneously concluded that it was enough that the benefits unlocked by the invention would in due course be realised over the whole range if and when all embodiments could be made. The Court of Appeals characterisation of the claim was informed by the principle that (to use the Board of Appeals formulation in Unilever/Detergents (T 435/91)) the protection covered by a patent should correspond to the technical contribution to the art made by the disclosure of the invention described therein. This principle, and the other principles that are relevant to determining sufficiency, can only be applied having close regard to the facts of the particular case, and the authorities make clear that an assessment of sufficiency does depend very much upon the nature of the individual invention and the facts of the particular case, see for example Unilever/Detergents (T 435/91), para 2.2.1. The Court of Appeal here recognised the general language used in the claim and its broad scope (Court of Appeal judgment, para 254), and we know that it had well in mind that it extended to a mouse with its entire variable gene locus replaced with the entire human variable gene locus (ibid, para 127). It focussed its analysis firmly on the reverse chimeric locus. The disclosure of the reverse chimeric locus was, it observed, a major contribution to the art because it solved the problem of immunological sickness (ibid, para 255). Every mouse encompassed in the claim will have the reverse chimeric locus, or, as the court put it at para 256 will benefit from the technical contribution the disclosure of the 163 patent has made to the article Every such mouse will, in the terms of the issue stated by the parties in the Statement of Fact and Issues, use the invention. This is what led the court to characterise the claim as a principle of general application (ibid, para 256). For sufficiency, it was necessary for the skilled team to be able to produce transgenic mice incorporating the reverse chimeric locus and producing hybrid antibodies, and this they could do, producing mice which would have had a near wild type response (ibid, para 264). That the claim encompassed inventive improvements (more human variable region incorporated) did not make it insufficient as any such improvement was still a way of working the original invention (ibid, para 265). Lord Briggs, seeking to concentrate attention upon the fact that this is a product claim, and to emphasise that patents are about products and not about ideas, chooses terms which focus rather upon the mice containing the reverse chimeric locus (mice fitted with a reverse chimeric locus as Lord Briggs terms them at para 58). This difference of terminology is perhaps of less significance than the spotlight that he trains upon the range of the mice, extending from mice fitted with a reverse chimeric locus incorporating a subset of the human variable region (feasible at the time of the claim) to mice fitted with a reverse chimeric locus incorporating the whole human variable region (achievable now but not at the time of the claim). It is this focus on the quantum of replaced material in the reverse chimeric locus, rather than on the reverse chimeric locus as a general principle, that leads to a different conclusion about sufficiency from that reached by the Court of Appeal. Given that I am alone in my disagreement with my colleagues, I can see little to be gained by a lengthy exegesis on the issues arising in the appeal. As I see it, and as perhaps appears from my exploration of the differences between the approach of this court and that of the Court of Appeal, the case turns upon how this particular claim is characterised, and how the law is applied to the particular facts of this case. I do not perceive the errors in the Court of Appeals approach that have been identified by the majority, and I would not have interfered with their conclusion that the claim here relates to a principle of general application. It still has to be enabled across its scope, but seen in this way, it is so enabled, being deployed in each mouse across the range, irrespective of the quantum of human material incorporated. Furthermore, it can also be said that protection across the range coincides with the technical contribution of the patents which was to solve the problem of immunological sickness, or putting it (loosely) another way, to facilitate the making of immunologically efficient mice.

In 2001 Regeneron Pharmaceuticals Inc filed patents for a new type of genetically modified mouse. Regenerons breakthrough was a hybrid version of the gene that produces antibodies, combining a section of the mouses genetic material (the constant region DNA) with a section of genetic material from a human (the variable region DNA). The resulting mouse can be used to produce antibodies which are suitable for medical treatment in humans, but are sufficiently similar to mouse antibodies that they do not cause immunological sickness in the mouse. The idea of combining a human variable region with a mouse constant region was a major contribution to science. At the hearing in February 2020 the court was told that hybrid mice incorporating this invention had a range of medical uses, including in the race to generate antibody therapies against coronavirus. In 2013 Regeneron sued a British company, Kymab Ltd, for infringement of its patents. Kymab was producing its own genetically modified mice, branded Kymice, with a similar genetic structure to Regenerons mice. Kymab responded by arguing the patents filed by Regeneron in 2001 were invalid because they fell foul of a patent law rule called sufficiency. Sufficiency means documents filed with the patent must be detailed enough to enable scientifically skilled readers to make the invention for themselves. The Court of Appeal found that Regenerons patents contained enough information to enable a skilled reader to insert some of the human material into a mouses genes. This would have created one type of hybrid mouse. However, the patents did not explain how to create a hybrid structure incorporating the full human variable region genes into the mouses genome. That was a complicated feat of genetic engineering and no reliable method for doing it was invented until 2011. This meant an expert reading the patents in 2001 would be unable to make many types of hybrid mice which Regeneron had claimed to have invented. The Court of Appeal upheld the patents, saying there was no need for the patents to explain how to make the full range of mice because Regenerons idea was a principle of general application. Kymab appealed to the Supreme Court. The Supreme Court allows Kymabs appeal by a majority of four to one, holding that the patents are invalid. Lord Briggs gives the majority judgment. Lady Black gives a dissenting judgment. A patent reflects a bargain between the inventor and the public. The inventor gains a time limited monopoly over the making and use of a product. In return, the public gains the ability to make the product after the expiry of the monopoly. As part of this bargain, the inventor must publish sufficient information to enable a skilled member of the public to make the product. This ensures that patent holders only gain legal protection which is proportional to their actual technical contribution to the art, and encourages inventors to conduct research for the benefit of society [23]. The Court of Appeal was influenced by the fact that Regenerons invention is a principle of general application. Its contribution to the field was present not only in mice which could be made in 2001, but also in mice with a larger amount of human genetic material which could be made using later scientific developments. The Court of Appeal thought it was unfair to limit Regenerons monopoly to types of hybrid mice which could be made when the patent was filed [27]. However, the authorities establish a number of principles in this area. Patentees must not make overly broad claims [56(iii)]. If they claim the right to make a range of products, sufficiency means they must disclose enough information to enable a skilled person to make the full range which is claimed [56(iv)]. This means a relevant range which affects the utility of the product [56(vii)]. So Regeneron was not required to explain how to make mice of varying colours, or with tails of varying length, because these features do not affect a mouses ability to produce antibodies [21]. Applying these principles, Regenerons patents did not enable a skilled person to make mice containing more than a very small section of the human variable region. The amount of human material was an important factor which was thought to affect the diversity of useful antibodies which the mice would produce. Mice at the more valuable end of the range could not be made using Regenerons patents. So Regeneron was claiming a monopoly which was far wider than its contribution to the art [57]. The Court of Appeal upheld patents over a range of mice even though Regeneron could only make mice over a small part of the range, at the least beneficial end of the range with the smallest amount of human genetic material [58]. Its analysis watered down the sufficiency requirement which is a bedrock of patent law, tilting the balance of patent law in favour of patentees and against the public [59]. Therefore, the majority allows the appeal and holds that the patents are invalid for insufficiency. Lady Black gives a dissenting judgment, in substance agreeing with the Court of Appeal. The application of the sufficiency requirement depends on the nature of the individual invention and the facts of the case. The Court of Appeal characterised Regenerons invention as a principle of general application which solved the problem of immunological sickness [83 84]. Seen in this way, the sufficiency requirement was met since the invention was deployed in each mouse across the range, irrespective of the quantum of human material incorporated [86].

8k-16k

This appeal raises the question whether the Commissioner of Police of the Metropolis (the Commissioner) owes a duty to her officers, in the conduct of proceedings against her based on their alleged misconduct, to take reasonable care to protect them from economic and reputational harm. Background facts The pleaded facts may be summarised as follows. On 2 December 2003 the respondents, four police officers serving in the Metropolitan Police Service, (the officers) took part in the arrest of a suspected terrorist, BA. BA subsequently made allegations that the officers had seriously assaulted and injured him during the arrest. The complaints were investigated by the Metropolitan Police Services Directorate of Professional Standards and the Crown Prosecution Service who concluded that there was no case to answer. However, the Independent Police Complaints Commission decided in October 2004 that one charge relating to the use of excessive force should be brought against the first respondent. That charge was dismissed by the disciplinary panel in April 2005. Between 14 January 2005 and 2 February 2005 the Independent Police Complaints Commission released the officers identities into the public domain. This led to threats of serious violence to the officers and their families on a website which supported BA. On 18 October 2007 BA issued civil proceedings against the Commissioner in which he alleged that the Commissioner was vicariously liable under section 88 of the Police Act 1996 for the serious assaults which he alleged the officers had inflicted on him. His claim included claims for aggravated and exemplary damages. The officers were not defendants in the action nor were contribution proceedings brought against them by the Commissioner. The defence of the claim on behalf of the Commissioner was undertaken by the Metropolitan Police Directorate of Legal Services (DLS). A defence denying liability was entered. On 10 January 2008 an offer of settlement was rejected by BA. On 18 March 2008 the officers attended a conference with Mr Jeremy Johnson of counsel, instructed by the DLS on behalf of the Commissioner. The officers subsequently alleged that counsel and the DLS solicitor assured them on that occasion that they were also acting for them and in their interests and told them that BAs claims would be vigorously defended. On 13 February 2009 an application by the Commissioner that the officers be permitted to give evidence from behind screens was dismissed at the pre trial review. On 10 March 2009 BA rejected a further offer of settlement because he wanted an apology or a finding in open court. The officers attended a second conference with Mr Johnson and the DLS on 11 March 2009. On this occasion the officers were accompanied by a solicitor from Russell Jones and Walker who attended only in relation to matters arising from a special measures application which had been made in respect of the evidence to be given by the respondents. At that conference the officers said that they would be reluctant to give evidence without special measures being in place. They allege that Mr Johnson informed them that he was no longer representing their interests but only the interests of the Commissioner. The officers allege that Mr Johnson indicated that the claim would be lost due to BAs medical evidence and they complained to him that they were unable to raise points on various aspects of the defence including medical evidence, expert evidence, CCTV footage and notes of arrest. The trial of BAs claim commenced on 16 March 2009. The officers declined to give evidence voluntarily without special measures being in place. On the third day of the trial, 18 March 2009, the Commissioner settled the claim on the basis of agreed damages of 60,000 and agreed costs of 240,000 with an admission of liability and an apology for gratuitous violence to which BA had been subjected by the officers. Paragraph 82 of the Particulars of Claim in the present proceedings alleges that the Commissioners office issued a press release stating: The Commissioner has demanded an immediate investigation into the circumstances surrounding the officers refusal to give evidence relating to this arrest in 2003. Whilst the arrest and subsequent events are historic this is a serious matter which has been referred to the IPCC. In the present proceedings the officers maintain that this was tantamount to endorsing their culpability. On 12 August 2010 the officers were each charged with one count of an assault occasioning actual bodily harm arising out of the arrest of BA. In June 2011, following a trial lasting five weeks, the officers were all acquitted. The current proceedings On 23 September 2013 the officers commenced the present proceedings against the Commissioner alleging breach of contract, negligence and misfeasance in public office arising from the manner in which the Commissioner had defended BAs claim. They sought compensation for reputational, economic and psychiatric damage. In the particulars of claim the officers put forward three bases on which it was alleged that the Commissioner owed them a duty of care. (1) A retainer had arisen between them and the Commissioners legal team because of the assurances given to them by counsel and the DLS solicitor. (2) The Commissioner had assumed a duty of care to the officers by reason of those same assurances. (3) The Commissioner owed the officers a duty of care in tort and concurrently in contract as employer or quasi employer to take reasonable care to safeguard their safety, health, welfare (including economic and professional welfare) and reputational interests, in the preparation and conduct of the defence to BAs claim and when considering and effecting any settlement of it. This third head of claim was said to include the following specific obligations to take reasonable care. (a) To keep the officers informed of the progress of the case. (b) To keep them and their families safe from threats by BAs supporters against their homes and physical safety. (c) To explain and provide reasons in the event that the Commissioner believed that BAs civil claim could no longer be defended or that a conflict had arisen between the officers and the Commissioner. (d) To consult the officers in sufficient time prior to the trial for them to obtain alternative and independent legal advice in the event that the Commissioner had decided to admit liability and make a public apology. (e) To warn the officers in sufficient time (to enable them to take independent legal advice or any other necessary steps to protect their own interests) prior to the opening of the trial that the application for special measures had failed, that the Commissioners lawyers were no longer acting for the officers or protecting their interests and that the Commissioner was considering admitting liability and making a public apology. The particulars of claim then provided detailed particulars of the alleged breaches of the duties. The officers do not allege that entering into an agreement on the terms of the settlement between the Commissioner and BA was in itself negligent. Their complaint is about the antecedent conduct of the defence by the Commissioner. In particular it is alleged that the Commissioner failed to conduct and prepare a competent defence to BAs claim. (See Jay J at para 23) Here complaint is made of the failure to proof or call as witnesses a list of named persons or to ascertain the availability of covert recordings. Complaint is made that evidence was lost, not located or not disclosed as a result of a systems failure. Complaint is also made of failure to take account of a list of miscellaneous evidential concerns raised by the respondents which, it is said, were either ignored or not adequately addressed. More generally, it is said that the Commissioner failed to keep the officers informed of the progress of the litigation and the preparation of the defence and failed to advise the officers within a reasonable time of the alleged conflict of interests. Complaint is made of the failure to obtain expert medical evidence to challenge the expert evidence called on behalf of BA and of a failure to apply for an adjournment of the trial. By notice dated 28 April 2014 the Commissioner applied to strike out the claims pursuant to CPR Part 3.4(2) on the grounds that they disclosed no reasonable grounds for the making of a claim, alternatively for summary judgment pursuant to CPR Part 24 on the grounds that the claims had no real prospect of success. On 1 May 2015 Jay J struck out the claims and entered summary judgment for the Commissioner. He considered that, in the absence of an express contract of retainer with the DLS, no retainer existed. Furthermore, the officers had no direct interest in the prior litigation and the possibility of consequential impact on their reputations was insufficient to create such an interest to which the Commissioner would be legally required to have regard or to promote or safeguard. The focus of the claim founded on the more general duty of care to protect the health, economic or reputational interests of the officers shifted during the hearing before Jay J. The judge seems to have been under the impression that the duty relied on by the officers was a duty to avoid psychiatric injury and that the claims for reputational damage and economic loss were entirely consequential on that head of damage. The judge considered that the officers had no real prospect of proving at trial that it was reasonably foreseeable that any breaches of duty by the Commissioner might cause psychiatric injury. However, the judge also observed that this basis of claim faced an insuperable difficulty under Caparo Industries plc v Dickman [1990] 2 AC 605 in that, given that the officers were not parties to BAs civil proceedings, the Commissioners lawyers owed duties solely to the Commissioner and the Commissioner was free to protect his own interests as he saw fit. He stated: The principled objection to this claim is that the postulated duty of care cuts right across the rights and obligations of the defendant itself, and those advising the defendant, in circumstances where no implied retainer existed. It would not be fair, just and reasonable to impose a concurrent conflicting duty of care in these circumstances: (at para 36) The claim for misfeasance was struck out as inadequately pleaded. The officers appealed to the Court of Appeal, save in respect of the claim in misfeasance. The Court of Appeal (Moore Bick, Longmore and Patten LJJ) dismissed the appeal in relation to the existence of a retainer and in relation to the assumption of responsibility. In addition, it dismissed the appeal in relation to psychiatric injury on the ground that such injury was not reasonably foreseeable. However, it allowed the appeal on the remaining issue, holding that it was arguable that the Commissioner owed a duty of care to the officers to safeguard their economic and reputational interests and that this extended to the conduct of litigation by the Commissioner. Moore Bick LJ, with whom the other members of the court agreed, accepted that the Commissioners primary duty was to protect the interests of the Metropolitan Police Service, but he did not consider that a duty of the kind alleged by the officers necessarily cut across this. In his view it was in the interest of the Commissioner and the officers for the defence to be conducted as effectively as possible and a duty of care in that regard would not inevitably give rise to any conflict of interest. Accordingly, he considered it arguable that the Commissioner owed to the officers (1) a duty to defend the litigation as effectively as possible and (2) a duty, when deciding whether to compromise the claim and if so on what terms, to take reasonable care not to sacrifice their interests and professional reputation without good reason and without giving them reasonable warning of what he intended to do. So far as breach of duty giving rise to actionable losses was concerned, Moore Bick LJ noted that there was no allegation that the Commissioners decision to compromise the claim was negligent in all the circumstances. However, the Commissioners forensic difficulties were alleged to have been a consequence of failures on the part of the MPS to identify or make available certain important pieces of evidence. In his view the essential elements of the claim for breach of a duty of care in relation to the conduct of the proceedings were present. The Court of Appeal came to a different conclusion, however, in respect of the allegation that the Commissioner was in breach of duty by failing to warn the officers in good time that he intended to pursue the interest of the MPS, if necessary at their expense. Moore Bick LJ agreed with the judge in dismissing as fanciful the suggestion that, had they been warned, the officers would have applied to be joined as defendants and would have instructed solicitors to conduct their defence independently. The Commissioner now appeals to the Supreme Court. The sole remaining allegation in the proceedings is that the Commissioner owed a duty of care to the officers to conduct the defence of the proceedings brought against her as effectively as possible in order to protect the officers from economic or reputational harm. There is no cross appeal by the officers in relation to the alleged retainer, the alleged assumption of responsibility or the head of claim alleging psychiatric injury. Nevertheless, the subject matter of those heads of claim which have fallen by the wayside forms an important part of the context in which the central issue now falls to be decided. The implied duty of trust and confidence Both before the Court of Appeal and before this court Mr Nicholas Bowen QC on behalf of the officers has placed at the forefront of his submissions the duty of trust and confidence which exists between an employer and his employees. He submits that the duty of care for which he contends is simply a manifestation of the long established term of trust and confidence which is implied into contracts of employment and that, accordingly, there is no scope or need for the court to conduct an assessment of whether the ingredients identified in Caparo v Dickman criteria are present and, in particular, whether the imposition of such a duty would be fair, just and reasonable. Police officers hold the public office of constable and are not employees. They have no contract of employment and the terms on which they hold their office are governed principally by the Police Regulations 2003 (SI 2003/527). Nevertheless, the relationship of Commissioner and officer is closely analogous to that of employer and employee (White v Chief Constable of South Yorkshire Police [1999] 2 AC 455, per Lord Steyn at p 497E F; per Lord Hoffmann at p 505C). In Mullaney v Chief Constable of West Midlands Police [2001] EWCA Civ 700 Clarke LJ, with whom Potter LJ and Bodey J agreed, considered (at para 52) that the relationship is so closely analogous as to make it just in principle to hold that a Chief Constable owes the same duties to his officers as an employer does to his employees. At this point of the discussion I am content to proceed on the basis that the Commissioner and these officers should be treated as if they were employer and employee, while recognising that, in the absence of any actual contract, any duty derived by analogy with the standard terms implied in an employment contract must necessarily sound as a duty of care, rather than be absolute. The mutual obligation of employer and employee not, without reasonable and proper cause, to engage in conduct likely to destroy or seriously damage the relationship of trust and confidence required between employer and employee is a standardised term implied by law into all contracts of employment rather than a term implied from the particular provisions of a particular employment contract (Malik v Bank of Credit and Commerce International SA [1998] AC 20, per Lord Steyn at p 45D). It was described by Lord Nicholls in Malik at p 35A, as a portmanteau concept. In that case the House of Lords considered it the source of a more specific implied obligation on the part of the employer bank not to conduct its business in a dishonest and corrupt manner, the breach of which gave rise to a cause of action for damage to the economic and reputational interests of its employees. Similarly, in Eastwood v Magnox Electric plc [2004] UKHL 35; [2005] 1 AC 503 the House of Lords recognised an obligation on an employer, in the conduct of his business and in the treatment of his employees, to act responsibly and in good faith (per Lord Nicholls at para 11). The implied term has been held to give rise to an obligation on the part of an employer to act fairly when taking positive action directed at the very continuance of the employment relationship (Gogay v Hertfordshire County Council [2000] IRLR 703; McCabe v Cornwall County Council [2004] UKHL 35; [2005] 1 AC 503; Bristol City Council v Deadman [2007] EWCA Civ 822; [2007] IRLR 888; Yapp v Foreign and Commonwealth Office [2014] EWCA Civ 1512; [2015] IRLR 112; Stevens v University of Birmingham [2015] EWHC 2300 (QB); [2016] 4 All ER 258). Furthermore, any decision making function entrusted to an employer must be exercised in accordance with the implied obligation of trust and confidence (Braganza v BP Shipping Ltd [2015] UKSC 17; [2015] 1 WLR 1661). If the present case is approached on the basis of implied contractual terms, the issue becomes whether, in unpacking this particular portmanteau implied term of trust and confidence, it is possible to extract a duty of care owed by an employer to its employees to conduct litigation in a manner which protects them from economic or reputational harm. It is significant that, despite the researches of counsel, we have not been referred to any decided case in any jurisdiction which holds that an employer owes such a duty of care to his employees. To derive such an obligation from the implied term of trust and confidence would be to move substantially beyond the specific derivative duties established to date. Although in Malik the House of Lords derived from the mutual implied contractual obligations of trust and confidence an implied obligation owed by the bank to its employees not to conduct a dishonest or corrupt business and held that damage to reputation resulting from breach sounded in damages, this is at a considerable remove from a duty to exercise care in the conduct of business so as to avoid economic or reputational damage to employees. This point was, in fact, emphasised by Lord Nicholls in a cautionary footnote: , [T]here are many circumstances in which an employees reputation may suffer from his having been associated with an unsuccessful business, or an unsuccessful department within a business. In the ordinary way this will not found a claim of the nature made in the present case, even if the business or department was run with gross incompetence. A key feature in the present case is the assumed fact that the business was dishonest or corrupt. (at p 42C D). In Scally v Southern Health and Social Services Board [1992] 1 AC 294 doctors sued their employer claiming damages, inter alia, in breach of contract and negligence, in respect of the failure of the employer to notify them of their entitlement under their contracts of employment to purchase, during a limited period of time, additional years of pension entitlement. The House of Lords held that the claimants common law claims were to be determined by reference to the contractual relationship and not in tort. The doctors claim succeeded but it is noteworthy that it did so on the narrow ground that where a contract negotiated between an employer and a representative body contains a term conferring on an employee a valuable benefit contingent upon his acting to obtain it, of which he could not be expected to be otherwise aware, there was an implied obligation on the employer to take reasonable steps to publicise that term. It is significant that the House of Lords did not base its decision on a more general duty of care owed by an employer to protect the economic interests of employees. Similarly, in Crossley v Faithful & Gould Holdings Ltd [2004] ICR 1615 the Court of Appeal refused to derive from the mutual duty of trust and confidence a standard obligation, implied by law as a term of all contracts of employment, which requires an employer to take reasonable care for the economic well being of his employees. The claimant, a senior employee and director of the defendant company, retired on grounds of ill health. He later brought an action for damages for breach of contract alleging that in failing to warn him of the effect which resigning from his employment would have on his entitlements under its insurance scheme, the defendant company had acted in breach of an implied term of the contract of employment requiring it to take reasonable care for his economic well being. Dyson LJ, with whom Thomas LJ and Sir Andrew Morritt V C agreed, rejected the proposed implied term. Having observed (at para 42) that it was not for that court to take a big leap to introduce a major extension of the law in this area when the House of Lords had declined to do so in Scally v Southern Health and Social Services Board [1992] 1 AC 294 and Spring v Guardian Assurance plc [1995] 2 AC 296, he developed (at para 43) the more fundamental objection that such an implied term would impose an unfair and unreasonable burden on employers. While an employer might assume responsibility under the Hedley Byrne principle, it was a quite different matter to impose on an employer the duty to give his employee financial advice or generally to safeguard his economic well being. Furthermore, I have difficulty in understanding how this principal argument on behalf of the officers can circumvent the requirement adverted to by Lord Bridge in Caparo v Dickman that the imposition of the duty must be fair, just and reasonable. In order to establish such a duty of care, the officers rely here upon a class of implied terms which are implied in law as a necessary incident of a particular class of contractual relationship. In Crossley Dyson LJ observed at para 36: [R]ather than focus on the elusive concept of necessity, it is better to recognise that, to some extent at least, the existence and scope of standardised implied terms raise questions of reasonableness, fairness and the balancing of competing policy considerations. This approach was commended by Lady Hale in Geys v Societe Generale, London Branch [2013] 1 AC 523 at paras 55, 56. The argument that such an implied term should extend to the conduct of litigation raises, therefore, precisely the same question as to whether the proposed term is fair and reasonable as arises if the claim is put in tort. Such an implied term, implied by law as an incident of a standardised contract, could not, to my mind, be wider in scope than the duty imposed by the law of tort. (White v Chief Constable of South Yorkshire Police, per Lord Griffiths at p 464C G; per Lord Goff at p 483C E; per Lord Steyn at p 498A B; per Lord Hoffmann at pp 505B 506B. See also the observations of Underhill LJ in Yapp v Foreign and Commonwealth Office at para 120.) It is difficult to see why such an implied term should extend further than a concurrent duty in negligence. Accordingly, it seems to me that the battlefield on which the conflicting contentions as to the existence of such a duty must be fought out is the scope of the duty of care in tort. In the present case the courts below have proceeded on the basis that, with the exception of the claim in respect of psychiatric injury which is no longer pursued, harm was arguably foreseeable. Furthermore, it was clearly arguable that by virtue of their relationship, akin to that of employer and employee, the parties were in a sufficiently proximate relationship to give rise to a duty of care. The argument therefore focussed on whether the imposition of a duty of care was fair, just and reasonable as indicated in Caparo. In Robinson v Chief Constable of West Yorkshire Police [2018] UKSC 4; [2018] 2 WLR 595 this court recently held, with regard to this aspect of Caparo, that it is normally only in a novel type of case, where established principles do not provide an answer, that the courts need to go beyond those principles in order to decide whether a duty of care should be recognised. Since the police generally owe a duty of care not to inflict physical injury by their actions when such a duty arises under the ordinary principles of the law of negligence, unless statute or other common law principle provides otherwise, there was no requirement in that case to examine whether the recognition of the claimed duty would be fair, just and reasonable. However, this ingredient will be of critical importance in a situation where it is proposed that a duty of care should be imposed in novel circumstances. Thus Lord Reed observed (at para 29): Properly understood, Caparo thus achieves a balance between legal certainty and justice. In the ordinary run of cases, courts consider what has been decided previously and follow the precedents (unless it is necessary to consider whether the precedents should be departed from). In cases where the question whether a duty of care arises has not previously been decided, the courts will consider the closest analogies in the existing law, with a view to maintaining the coherence of the law and the avoidance of inappropriate distinctions. They will also weigh up the reasons for and against imposing liability, in order to decide whether the existence of a duty of care would be just and reasonable. Contrary to the submission of Mr Bowen on behalf of the officers, the present case is very clearly one in which it is sought to extend a duty of care to a new situation. As Lord Reed explained in Robinson, in determining whether such a duty should be recognised the law will proceed incrementally and by analogy with previous decisions. He referred, in particular, to the following passage in the judgment of Brennan J in Sutherland Shire Council v Heyman (1985) 60 ALR 1, 43 44, which was approved by Lord Bridge in Caparo at p 618: It is preferable, in my view, that the law should develop novel categories of negligence incrementally and by analogy with established categories, rather than by a massive extension of a prima facie duty of care restrained only by indefinable considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed. The theme was developed by Lord Bingham in Customs and Excise Comrs v Barclays Bank plc [2007] 1 AC 181 where he observed at para 7: I incline to agree with the view that the incremental test is of little value as a test in itself, and is only helpful when used in combination with a test or principle which identifies the legally significant features of a situation. The closer the facts of the case in issue to those of a case in which a duty of care has been held to exist, the readier a court will be, on the approach of Brennan J adopted in Caparo Industries plc v Dickman, to find that there has been an assumption of responsibility or that the proximity and policy conditions of the threefold test are satisfied. The converse is also true. In addition, the proposed duty will be tested against considerations of legal policy and judgement will have to be exercised with particular regard to both the achievement of justice in the particular case and the coherent development of the law. The law protects reputation in a variety of ways in different circumstances. Causes of action such as libel, slander, malicious falsehood and passing off are designed to protect reputation. Moreover, a variety of other causes of action including breach of confidence, misuse of private information and causes of action in relation to data protection and intellectual property may often indirectly achieve this result. The common law does not usually recognise a duty of care in the tort of negligence to protect reputational interests. However, there are exceptions. In Spring v Guardian Assurance plc [1995] 2 AC 296 a majority of the House of Lords held that an employer who gave a reference in respect of a former employee owed that employee a duty to take reasonable care in its preparation and would be liable to him in negligence for a breach of duty which caused him economic loss. Lord Lowry, Lord Slynn and Lord Woolf reached this conclusion on the basis of the three ingredients identified by Lord Bridge in Caparo. Lord Goff (at p 316E F) concluded that a duty of care was owed to the former employee on a narrower ground. In his view the source of the duty of care was the principle in Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 ie an assumption of responsibility by the authors of the reference to the plaintiff in respect of the reference, and reliance by the plaintiff upon the exercise by them of due care and skill in respect of its preparation. This case was essentially concerned with negligent mis statement and it may be that assumption of responsibility is the better rationalisation of the recognition of a duty in these circumstances. (See NRAM Ltd (formerly NRAM plc) v Steel [2018] UKSC 13; [2018] 1 WLR 1190 per Lord Wilson at para 24 referring also to Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 per Lord Goff at p 181 and Williams v Natural Life Health Foods Ltd [1998] 1 WLR 830 per Lord Steyn at p 837.) This decision should be contrasted with Calveley v Chief Constable of the Merseyside Police [1989] 1 AC 1228. Following their reinstatement, police officers, against whom disciplinary proceedings had been taken, brought actions in negligence against their Chief Constables on the basis that they were vicariously liable for the investigating officers. The claimants alleged that the investigating officers had failed to conduct the proceedings properly or expeditiously and claimed, inter alia, damages in respect of loss of overtime earnings during their suspension and damages for injury to reputation. The House of Lords considered the submission that a duty of care was owed to the claimants to be unsustainable. First, Lord Bridge explained (at p 1238B G), anxiety, vexation and injury to reputation did not constitute reasonably foreseeable damage capable of sustaining an action in negligence within Donoghue v Stevenson [1932] AC 562. Secondly, it was not reasonably foreseeable that the negligent conduct of a criminal investigation would cause injury to the health of the suspect, whether in the form of depressive illness or otherwise. Thirdly, while it is reasonably foreseeable that a suspect may suffer some economic loss which might have been avoided had more careful investigation established his innocence at an earlier stage, such a claim would encounter the formidable obstacles in the path of liability in negligence for purely economic loss. Fourthly, it would be contrary to public policy to prejudice the discharge by police officers of their public duty of investigating crime by requiring them to act under the shadow of a potential action for damages for negligence by the suspect. To my mind Calveley has an important bearing on the present case. If a Chief Constable does not, in principle, owe a duty of care to protect the economic and reputational interests of his officers in respect of the prosecution of an investigation or disciplinary proceedings, it is difficult to see why he should owe a duty to his officers as to the manner in which he defends a claim brought against him by a third party. In the former situation the Chief Constable has himself initiated the investigation or proceedings over which he has at least a substantial measure of control and he is responsible for making allegations against officers. In the latter situation his role is essentially responsive to allegations made by third parties. In these circumstances it is necessary to test the proposed duty of care against relevant policy considerations and to consider the coherence of the resulting state of the law if such a duty is recognised. Conflicting interests The fact that a duty of care may give rise to conflicting interests will often be a weighty consideration against its imposition. In D v East Berkshire Community Health NHS Trust [2005] 2 AC 373 a majority of the House of Lords held that health care and childcare professionals investigating allegations of child abuse did not owe a duty of care to the parents of the children concerned. Lord Nicholls explained (at para 85) that conflict of interest was a persuasive factor here. When considering whether a child has been abused, a doctor should be able to act single mindedly in the interests of the child and he ought not to have at the back of his mind an awareness that if his doubts about intentional injury or sexual abuse were to prove unfounded he might be exposed to claims by a distressed parent. At that time [when a doctor is carrying out his investigation] the doctor does not know whether there has been abuse by the parent. But he knows that when he is considering this possibility the interests of parent and child are diametrically opposed. The interests of the child are that the doctor should report any suspicions he may have and that he should carry out further investigation in consultation with other child care professionals. The interests of the parent do not favour either of these steps. This difference of interest in the outcome is an unsatisfactory basis for imposing a duty of care on a doctor in favour of a parent. (at para 88) Similarly, in SXH v Crown Prosecution Service [2017] UKSC 30; [2017] 1 WLR 1401 Lord Toulson, with whom Lord Mance, Lord Reed and Lord Hughes agreed, considered (at para 38) that the duty of the Crown Prosecution Service (CPS) is to the public and not to the victim or the suspect, who have separate interests, and that to recognise a duty of care towards victims or suspects or both would put the CPS in positions of potential conflict. Yet, the fact that the recognition of a duty of care may potentially subject an individual to conflicting duties is not, of itself, necessarily conclusive against its recognition in all situations. Clearly, there will be many situations in which an individual will owe potentially conflicting duties to different persons. In Gogay v Hertfordshire County Council the managers of a childrens home owed both a duty of care to the resident children and an implied contractual duty of trust and confidence to its staff, notwithstanding the fact that in the case of an actual conflict the interests of the child should prevail. (See Hale LJ at para 59) Similarly, in D v East Berkshire Lord Nicholls referred (at para 86) to the fact that a doctor often owes duties to more than one person. He may owe duties, for example, to his employer and to his patient. (See also ABC v St Georges Healthcare NHS Trust [2017] EWCA Civ 336; [2017] PIQR P15.) However, in D the House concluded that the seriousness of child abuse as a social problem demanded that health professionals, acting in good faith in what they believe are the best interests of the child, should not be subject to potentially conflicting duties when deciding whether a child may have been abused or in deciding what action should be taken. It is necessary, therefore, to have regard to the competing underlying policy considerations, when determining whether a duty of care may be imposed notwithstanding that it may give rise to a conflict of interests. The interests of an employer who is sued on the basis that he is vicariously liable for the tortious conduct of his employees differ fundamentally from the interests of those employees. The financial, commercial and reputational standing of the employer may be at stake. It is the employer who will incur the cost of defending the proceedings which, however successful the defence may be, is most unlikely to be recovered in full, and who, if unsuccessful, will bear the liability to the claimant. The employer must be able to make his own investigation into the claim and to assess its strength based on the conduct of his employee and the prospects of a successful defence. In this regard, he will need to form his own view as to the reliability and veracity of his employee and as to how the employee is likely to perform as a witness. The interests of insurers may have to be taken into account. The employer will have to decide what degree of importance he attaches to successfully defending the claim and what financial and other resources should be devoted to its defence. He may consider that, however strong the prospects of a successful defence, he cannot justify the cost and effort of defending the claim and that it should, therefore, be settled. The predominant interest of the employee, by contrast, will be that his reputation should be vindicated. The position will often be complicated further by the existence of inconsistent views or interests between different employees or groups of employees. (See, for example, Mohidin v Comr of Police of the Metropolis [2016] EWHC 105 (QB) (Gilbart J) [2016] 1 Costs LR 71, para 14) In cases where an employer is alleged to be vicariously liable for the tortious conduct of his employee, the possibility of contribution proceedings between employer and employee highlights this potential conflict of interests. It is particularly relevant here that claims under the Civil Liability (Contribution) Act 1978 may be brought up to two years after judgment in the original claim or settlement of that claim (Limitation Act 1980, section 10). That the possibility of bringing such a claim is not fanciful, at least in cases where deliberate misconduct is alleged, is demonstrated by Mohidin v Comr of Police of the Metropolis where such a claim succeeded. These stark differences between the interests of employer and employee strongly suggest that it would not be fair, just or reasonable to impose on an employer a duty of care to defend legal proceedings so as to protect the economic or reputational interests of his employee. Nor do I consider it realistic to suggest, as do the respondents in the present case, that this potential for conflict can be overcome by the recognition of a duty of care up to the time at which an actual conflict of interests arises, at which point timeous notification by the Commissioner could result in the duty of care ceasing to apply. Where an employer defends a claim against him founded on his vicarious liability for his employees, the potential for conflict is too great to permit such a compromise. Moreover, it would often be totally impracticable. A civil claim and its defence, as they proceed, often develop in unexpected ways. There could be no justification for imposing on an employer the burden of keeping under review at each stage of the proceedings the question whether an actual conflict has arisen. Furthermore, steps taken by the employee as a result of such timeous notification of the emergence of an actual conflict may well be disruptive of the litigation. In the present case, moreover, the Commissioner is not merely in a position analogous to that of an employer. She also holds public office and has responsibility for the Metropolitan Police Service. This adds a further dimension to this appeal because in the conduct of the proceedings against her she must be free to act as she considers appropriate in accordance with her public duty. This duty is, to my mind, totally inconsistent with her owing a duty of care to protect the reputational interests of her employees when defending litigation based on vicarious liability for their alleged misconduct. As we have seen, in Calveley the House concluded that it would be contrary to public policy to prejudice the discharge by the police of their public duty to investigate alleged misconduct by officers by imposing a conflicting duty of care to protect the reputational interests of those officers. In the same way in SXH this court considered (at para 38) that to recognise a duty of care owed by the CPS to victims or suspects would not be conducive to the best interests of the criminal justice system. These considerations apply with equal force to the present case. Policy considerations relating to the conduct of litigation Considerations relating to legal policy and the practical conduct of proceedings also weigh heavily against the duty for which the officers contend. First, there is an important public policy that parties in dispute should, in general, be able to avail themselves of the processes of litigation in order to resolve their disputes, without fear of incurring liability to third parties if they do so. This policy was expressed by Wilde CJ (with whom Maule J, Cresswell J, Williams J, Parke B and Rolfe B agreed) in De Medina v Grove (1847) 10 QB 172 at p 176: The law allows every person to employ its process for the purpose of trying his rights, without subjecting him to any liability, unless he acts maliciously and without probable cause. This policy underlies a number of legal principles including the general immunity which attaches to things said and done in court by witnesses and litigants and the principle that a duty of care is not owed by one litigant to an opposing litigant. (See, generally, Willers v Joyce [2016] UKSC 43; [2016] 3 WLR 477 per Lord Mance at para 135.) An employer who wishes to defend a claim based on vicarious liability for the alleged conduct of his employees should be entitled to defend the claim in the way he sees fit, notwithstanding that his employees will or may as a result be subjected to public criticism during the trial process. He should be free to do so without having constantly to look over his shoulder for fear that his conduct of the defence may expose him to a claim by his employees. Decisions in the conduct of the defence, such as which inquiries to undertake, which experts to instruct, which witnesses to call or which resources to devote to resisting the claim, are essentially matters for the employer as defendant and should be taken free of anxiety as to possible future claims by the employees on the basis that the case should have been run differently. The proposed duty would, to my mind, inevitably inhibit the conduct of the defence. An employer would, understandably, be less likely to make admissions in circumstances where they are objectively justified or to make use of evidence which reflects unfavourably on an employee, for fear of the subsequent repercussions. I have no doubt that the imposition of the duty of care contended for in the present case would, as the Commissioner submits, have a chilling effect on the defence of civil proceedings. Secondly, the recognition of a duty owed by an employer to his employees to defend a claim effectively would be inconsistent with the important legal policy which encourages the settlement of civil claims and seeks to promote out of court settlement. The resulting risk of exposure to consequential claims would, in many situations, operate as a powerful disincentive to settlement. Thirdly, the duty contended for could result in delay or disruption of civil proceedings. Disputes between employers and employees as to the appropriate way in which the defence should be conducted could well paralyse the defence. Resort to some form of dispute resolution procedure could be expensive and time consuming. In many instances the employer may well feel compelled to make a contribution claim against his employees in order to negative the imposition of a duty of care owed to them. Moreover, the existence of such a duty may result in an employer needlessly prolonging proceedings against him in an attempt to establish that he has taken care to protect the interests of his employees. (See N McBride, PN 2017 (33) 3, 216 at p 219.) Fourthly, the recognition of such a duty of care would be a fruitful source of satellite litigation. While there are some situations in which litigation about the conduct of prior litigation is unavoidable, it is generally to be discouraged. The acknowledgement of a duty owed by employers to their employees to protect their economic or reputational interests in the conduct of litigation would be likely to result in a proliferation of consequential claims which would often amount to a collateral challenge to the outcome of earlier proceedings. Legal professional privilege It is also necessary to say something about the issue of legal professional privilege. At first instance, it was submitted on behalf of the Commissioner that legal professional privilege was a further policy consideration for not imposing a duty of care in these circumstances. It was submitted that if such a duty of care existed an employer would in effect be compelled to waive privilege in circumstances where he would otherwise be entitled to assert privilege, because the correctness or reasonableness of his conduct of the underlying litigation could not be properly examined without relevant legal advice being properly exposed to judicial scrutiny. The response on behalf of the officers was that the relationship between the parties gave rise to a joint or common interest with the result that the Commissioner would, in any event, be unable to rely on legal professional privilege against the officers to the extent that common interest privilege applied. In his judgment Jay J expressly stated that he did not rely on legal professional privilege in coming to the conclusion that there was no arguable duty of care. The Court of Appeal did not address this point in its judgments. The judgments below have established that the legal advisers who defended the claim brought by BA were instructed on behalf of the Commissioner only and that neither those lawyers nor the Commissioner undertook responsibility to the officers for the conduct of the litigation. The officers attended conferences with counsel in the capacity of witnesses not clients. The officers do not seek to appeal those conclusions. Accordingly, there can be no question of legal professional privilege belonging jointly to the Commissioner and the officers. However, the officers rely on common interest privilege and seek to employ it as a sword in asserting an entitlement to disclosure of material in the possession of the Commissioner which is privileged against disclosure to others. Whether the officers have such an entitlement will depend on whether such a claim is consistent with the underlying relationship of the Commissioner and the officers. (See Phipson on Evidence, 19th ed (2017), para 24 11.) In my view it is not. If one sets to one side the decided cases which turn on contractual access rights, the cases show that something more than a shared interest in the outcome of litigation is required before common interest privilege can be used as a sword in the manner proposed here. For example, in Dennis & Sons Ltd v West Norfolk Farmers Manure and Chemical Co operative Co Ltd [1943] Ch 220 Simonds J held that shareholders were entitled to disclosure of an accountants report concerning the rights and duties of the board commissioned by the directors, notwithstanding that by the time the report was received the shareholders had commenced proceedings against the company in relation to the conduct of the companys affairs. The report had been commissioned by the directors on behalf of all the shareholders and not for the purpose of defending themselves against hostile litigation. The judge observed (at p 222) that the general rule applied equally as between a company and its shareholders and as between a trustee and his beneficiaries. A claim to privilege between the company and its shareholders would have been inconsistent with the nature of the relationship. Similarly, in CIA Barca de Panama SA v George Wimpey & Co Ltd [1980] 1 Lloyds Rep 598, Barca and Wimpey each held half the shares in a joint venture company, DLW, which had claims against Aramco. Wimpey settled the claims without authority from Barca. In the resulting proceedings brought by Barca against Wimpey the Court of Appeal held that Barca was entitled to disclosure of privileged documents of Wimpey generated in the original litigation as the Aramco claims had been made by Wimpey on behalf of itself and Barca (per Stephenson LJ at p 614). In Commercial Union Assurance Co plc v Mander [1996] 2 Lloyds Rep 640, at 647 648, Moore Bick J provided the following example: Although in many cases a relationship between two parties which supports common interest privilege will be one which also gives each of them a right to obtain disclosure of confidential documents relating to the matter in which they are both interested, one can readily think of situations in which that would not be so. Take the example given by Donaldson LJ in Buttes v Hammer (No 3) of tenants in a block of flats. One tenant, acting entirely for his own benefit, obtains legal advice concerning a dispute with the landlord over a provision in the lease which affects other tenants in a similar way. If he chooses to give a copy of the document containing that advice in confidence to another tenant who is willing to cooperate with him in pursuing a claim their common interest would be sufficient for the document to remain privileged in the latters hands. I do not, however, see any basis upon which the second tenant could have insisted on seeing the advice if the first tenant did not wish to show it to him, even though they had a common interest in the subject matter. Both as a matter of principle and authority it is not enough that the person seeking disclosure of confidential documents can show that he has an interest in the subject matter which would be sufficient to give rise to common interest privilege if the documents had been disclosed to him; he must be able to establish a right to obtain access to them by reason of a common interest in their subject matter which existed at the time the advice was sought or the documents were obtained. In the present case the Commissioner and the officers are likely to have had a shared interest in successfully defending the claim brought by BA against the Commissioner, at least initially. It may well be that, had privileged documents been disclosed in confidence by the Commissioner to the officers at that stage, that shared interest would have enabled the officers to defeat an application for disclosure by a third party on grounds of common interest privilege. However, before the officers could compel disclosure of privileged material in the hands of the Commissioner, considerably more would be required. Although the relationship between the Commissioner and the officers is closely analogous to that of employer and employees, there is nothing in the present situation which resembles the relationship between a company and its shareholders, or between a trustee and his beneficiaries, or between parties to a joint venture agreement. Here the relationship between the Commissioner and the officers does not require or justify such an entitlement of access to legally privileged material. Considered against this background, there is force in the Commissioners submission as to the practical consequences in this regard of the recognition of the duty of care for which the officers contend. Although employees would normally have no entitlement to disclosure of privileged material in the possession of their employer relating to the defence of the original proceedings, the effective defence of proceedings by the employees against the employer brought on the basis that the earlier proceedings were conducted in breach of duty may well require waiver of privilege in order to demonstrate the contrary. This has the potential to undermine the effective conduct of the defence of the original claim against the employer in that the possibility of such a claim in negligence and the likelihood of having to waive privilege may well inhibit frank discussion between the employer and his legal advisers. This is, therefore, a further consideration which weighs against the recognition of the duty of care for which the officers contend. Conclusion For these reasons I would allow the appeal. The imposition of the claimed duty would not be fair, just or reasonable.

On 2 December 2003 the Respondents, four police officers serving in the Metropolitan Police Service (the officers), took part in the arrest of a suspected terrorist, BA. BA subsequently made allegations that the officers had seriously assaulted and injured him during the arrest. In October 2004, the Independent Police Complaints Commission (IPCC) decided that one charge should be brought against the First Respondent. That charge was dismissed in April 2005. Between 14 January and 2 February 2005 the IPCC released the officers identities into the public domain. This led to threats of serious violence to the officers and their families on a website that supported BA. On 18 October 2007 BA commenced civil proceedings against the Appellant Commissioner in which he alleged that the Commissioner was vicariously liable for the serious assaults that he alleged the officers had inflicted on him. The officers were not parties to these proceedings. On 18 March 2008 the officers attended a meeting with legal advisers instructed on behalf of the Commissioner. The officers subsequently alleged that they were assured at this meeting that the Commissioners legal advisers were also acting for them. The officers maintain that at a second meeting with legal advisers instructed on behalf of the Commissioner on 11 March 2009 they were told that the legal team was no longer representing their interests but only those of the Commissioner. The trial of BAs claim commenced on 16 March 2009. The officers declined to give evidence voluntarily without special measures to protect their identity being put in place. On the third day of the trial, the claim was settled with an admission of liability by the Commissioner and an apology for the gratuitous violence to which BA had been subjected by the officers. The officers maintain that a press release issued by the Commissioner after trial was tantamount to endorsing their culpability. In June 2011, the officers were all acquitted in the Crown Court of charges of assault occasioning actual bodily harm arising out of the arrest of BA. On 23 September 2013, the officers commenced the present proceedings against the Commissioner seeking compensation for reputational, economic and psychiatric damage. They advanced three claims: (i) a retainer had arisen between them and the Commissioners legal team, (ii) the Commissioner had assumed a duty of care by reason of the assurances, and (iii) the Commissioner owed them a duty to take reasonable care to safeguard their safety, health, welfare (including economic and professional welfare) and reputational interests in the preparation and conduct of the defence of BAs claim. On 1 May 2015 the judge struck out these claims. The judge found, amongst other things, that the officers had no direct interest in the litigation between the Commissioner and BA and the possibility of consequential impact on their reputations was insufficient to create such an interest to which the Commissioner would be legally required to have regard. The officers appeal to the Court of Appeal was successful in part. The Court of Appeal held that it was arguable that the Commissioner owed a duty of care to the officers to safeguard their economic and reputational interests and that this extended to the Commissioners conduct of the litigation. The Commissioner now appeals to the Supreme Court solely on this issue. The Supreme Court unanimously allows the appeal. Lord Lloyd Jones gives the judgment with which the other Justices agree. Although police officers have no contract of employment, the officers relied heavily on the analogy of the implied term in employment contracts of mutual trust and confidence between employer and employee [16]. However, the Court was not referred to any decided case in any jurisdiction which holds that the duty of care for which the officers contend can be derived from this mutual implied term [17]. To derive such an obligation would be to move substantially beyond the specific derivative duties established in previous cases [18 20]. The existence of the proposed duty must be established in the tort of negligence [21]. This is clearly a case in which it is sought to extend a duty of care to a new situation. In determining whether such a duty should be recognised the law will proceed incrementally and by analogy with previous decisions (Robinson v Chief Constable of West Yorkshire Police [2018] UKSC 4). The proposed duty will also be tested against considerations of legal policy and the coherent development of the law [22 23] The common law does not usually recognise a duty of care in the tort of negligence to protect reputational interests [23]. The decision in Calveley v Chief Constable of Merseyside Police [1989] 1 AC 1228 has an important bearing on the present case. There it was held that a Chief Constable does not, in principle, owe a duty of care to protect the economic and reputational interests of his officers in respect of the prosecution of an investigation or disciplinary proceedings against them. It is therefore difficult to see why a Chief Constable should owe a duty to his officers as to the manner in which he defends a claim brought against him by a third party, especially considering that, in such a claim, the Chief Constables role is essentially responsive to allegations made by the third party [25 26]. The fact that the recognition of a duty of care may potentially subject an individual to conflicting duties does not necessarily preclude its imposition but in such cases it is necessary to have regard to the competing underlying policy considerations [28 29]. The interests of an employer who is sued on the basis that he is vicariously liable for the tortious conduct of his employees differ fundamentally from the interest of those employees [30]. The possibility of contribution proceedings between employer and employee highlights the potential for conflicts of interests [31]. These stark differences in interests strongly suggest that it would not be fair, just or reasonable to impose on an employer a duty of care to defend legal proceedings so as to protect the economic or reputational interests of his employees. It is not realistic to suggest that this potential for conflict can be overcome by recognition of a duty of care up to the time at which an actual conflict arises [32]. Moreover, in the context of the present case, the Commissioners public duties are inconsistent with the imposition of such a duty of care [33]. Considerations relating to legal policy and the practical conduct of proceedings also weigh heavily against the duty for which the officers contend. For instance, parties to a dispute should be able to conduct litigation in order to resolve their disputes without fear of incurring liability to third parties [34 38]. Finally, the officers argue that, because both they and the Commissioner had a common interest in the outcome of BAs claim, they would have been able to rely on common interest privilege in asserting an entitlement to the disclosure of material in the possession of the Commissioner which is privileged against disclosure to others. However, the cases show that something more than a shared interest in the outcome of litigation is required before common interest privilege can be used in this manner. Legal professional privilege is, therefore, a further policy consideration that weighs against the recognition of the duty of care for which the officers contend [39 46].

8k-16k

This appeal concerns the statutory right of appeal against decisions by the Secretary of State for the Home Department (the Secretary of State) to refuse protection claims and human rights claims under Part 5 of the Nationality, Immigration and Asylum Act 2002 (the 2002 Act) as amended. The particular question for decision is as follows: Where a person has already had a protection claim or a human rights claim refused and there is no pending appeal, do further submissions which rely on protection or human rights grounds have to be accepted by the Secretary of State as a fresh claim in accordance with rule 353 of the Immigration Rules if a decision in response to those representations is to attract a right of appeal under section 82 of the 2002 Act? It is a conspicuous feature of litigation in the field of immigration and asylum in this jurisdiction that those whose protection claims or human rights claims have already been refused seek to make further applications adducing further submissions or evidence in support. It is necessary that provision be made for such renewed applications for which there is a sound basis, not least because circumstances may change significantly and unforeseeably following the rejection of a claim. In R v Secretary of State for the Home Department, Ex p Onibiyo [1996] QB 768 Sir Thomas Bingham MR noted (at pp 781 782) that, for example, it is not hard to imagine cases in which an initial claim for asylum might be made on insubstantial, or even bogus, grounds, and be rightly rejected, but in which circumstances would subsequently arise or come to light showing a threat of a kind requiring the grant of asylum. As he observed, a scheme of legal protection which could not accommodate that possibility would be seriously defective. In appropriate cases, it will be necessary to afford access to the statutory system of appeals when a second or subsequent submission is rejected. Nevertheless, it is necessary to protect such a scheme of legal protection from abuse. There is, therefore, a need to exclude from the statutory system of appeals second or successive applications which are made on grounds which have previously been rejected or which have no realistic prospect of success, and which are often advanced simply in order to delay removal from the United Kingdom. The challenge is to provide a system which can deal fairly and effectively with all such applications while also complying with the United Kingdoms international obligations. The facts The appellant, Mr Jamar Robinson, is a national of Jamaica who was born on 14 May 1991. He arrived in the United Kingdom on 9 October 1998 when he was seven years old. He was given leave to enter until 9 April 1999 and then remained in the United Kingdom without leave. In 2005, at the age of 13, he applied for indefinite leave to remain in the United Kingdom as a dependant of his aunt who had made an application under a one off exercise to allow families who have been in the United Kingdom for three years or more to stay. His aunt was granted indefinite leave to remain on 13 May 2011. The appellants application was refused as part of later deportation proceedings. The appellant has a number of criminal convictions. The index offences which triggered deportation proceedings were two robberies for each of which he was sentenced on 20 April 2011 to 18 months detention, to run concurrently. At sentence he was 19 years of age. On the same occasion he was convicted of failing to comply with the requirements of a previous community order. On 31 August 2011, aged 20, he was convicted of an offence of robbery and an offence of theft, in respect of which he was sentenced to terms of 40 months detention and 16 months detention respectively, to run concurrently. On 12 October 2012, aged 21, he was convicted of an offence of violent disorder, committed while he was an inmate at HMP Feltham, for which he was sentenced to 12 months imprisonment. On 10 June 2011 he was notified by the Secretary of State of his liability to deportation. His previous legal representatives responded on 16 August 2011. On 17 July 2013 a deportation order was signed in respect of the appellant. He appealed to the First tier Tribunal (Immigration and Asylum Chamber) (FTT) against his proposed deportation. His appeal was based on his claimed right to respect for his private life in the United Kingdom. It was accepted that at that time there was no family life in play. His appeal was dismissed and he was refused permission to appeal to the Upper Tribunal (Immigration and Asylum Chamber) (UT) by the FTT and by the UT. He exhausted his rights of appeal on 1 May 2015. On 13 May 2015 the appellants previous solicitors made brief further submissions to the Secretary of State on his behalf. The focus of these submissions was that the appellants then partner was pregnant and due to give birth on 28 July 2015. The application did not explicitly request that the deportation order be revoked, nor did it explicitly make reference to human rights. The Secretary of State treated the further representations as an application to revoke the appellants deportation order on the basis that deportation would breach article 8 of the European Convention on Human Rights. She responded to those submissions in a letter of 23 June 2015. She concluded that deportation would not breach article 8. She refused to revoke the deportation order, and she decided that his submissions did not amount to a fresh human rights claim under rule 353 of the Immigration Rules. The appellants son was born on 26 July 2015. He is a British citizen by birth because his mother is British. The appellant then made further submissions to the Secretary of State on 28 July 2015 regarding the birth of his son and providing some documentation from the hospital. The Secretary of State responded to these further submissions in a letter dated 31 July 2015. Once again, the Secretary of State concluded that deportation of the appellant would not breach article 8 and that his further submissions did not amount to a fresh claim under rule 353 of the Immigration Rules. On 18 July 2015 the Secretary of State gave directions for the appellants removal to Jamaica on 9 August 2015. A request for temporary admission was made on 30 July 2015 in order to enable the appellant to visit his son. The enclosed documents included a statutory declaration from the appellant declaring that he is the childs father. The appellant was subsequently named as the father on the childs birth certificate. On 5 August 2015 the appellants solicitors gave notice of appeal to the FTT against the Secretary of States decision of 31 July 2015. In a decision dated 7 August 2015, promulgated on 10 August 2015, the FTT declined jurisdiction on the basis that there was no right of appeal against the decision of 31 July 2015. On 7 August 2015 the appellant made an application for permission to apply for judicial review of the Secretary of States decisions of 23 June 2015 and 31 July 2015 not to accept the further representations as fresh claims and the removal directions given on 18 July 2015. After the proceedings were lodged the Secretary of State confirmed that removal of the appellant would be deferred. The appellant applied to amend his grounds to include the FTT as second respondent and to challenge its decision of 7 August 2015 that the appellant had no right to appeal against the decision of 31 July 2015. UT Judge Allen granted the appellant permission to join the FTT and to amend his grounds. On 19 November 2015 UT Judge Eshun granted the appellant permission to apply for judicial review. The application for judicial review was heard by UT Judge Southern on 16 February 2016 who held that: the decisions of 23 June 2015 and 31 July 2015 were lawful with the Secretary of States letters were not refusals to revoke the the FTT had correctly decided that the appellant had no right of appeal (1) to the FTT; (2) appellants deportation order; and (3) regard to rule 353 of the Immigration Rules. He refused permission to appeal to the Court of Appeal. On 9 March 2016 the appellant applied to the Court of Appeal for permission to appeal. The Secretary of State sought to deport the appellant to Jamaica on 13 April 2016. On 12 April 2016 Rafferty LJ granted the appellant a stay on removal. On 2 December 2016 Underhill LJ, on consideration of the papers, granted permission to appeal to the Court of Appeal. On 4 May 2017 the Court of Appeal (Jackson, Hamblen and Flaux LJJ) dismissed the appellants appeal and refused permission to appeal to the Supreme Court. The appellant was granted a stay on removal pending final determination of his appeal. The Supreme Court granted permission to appeal by order dated 10 April 2018. The relevant legislation Part 5 of the 2002 Act in force immediately prior to the commencement of the Immigration Act 2014 (the 2014 Act) ie prior to 20 October 2014, provided in relevant part: 82. Right of appeal: general (1) Where an immigration decision is made in respect of a person he may appeal to the Tribunal. (2) refusal of entry clearance, refusal of a certificate of entitlement In this Part immigration decision means refusal of leave to enter the United (a) Kingdom, (b) (c) under section 10 of this Act, (d) refusal to vary a persons leave to enter or remain in the United Kingdom if the result of the refusal is that the person has no leave to enter or remain, (e) variation of a persons leave to enter or remain in the United Kingdom if when the variation takes effect the person has no leave to enter or remain, (f) revocation under section 76 of this Act of indefinite leave to enter or remain in the United Kingdom, (g) a decision that a person is to be removed from the United Kingdom by way of directions under section 10(1)(a), (b), (ba) or (c) of the Immigration and Asylum Act 1999 (c 33) (removal of person unlawfully in United Kingdom), (h) a decision that an illegal entrant is to be removed from the United Kingdom by way of directions under paragraphs 8 to 10 of Schedule 2 to the Immigration Act 1971 (c 77) (control of entry: removal), (ha) a decision that a person is to be removed from the United Kingdom by way of directions under section 47 of the Immigration, Asylum and Nationality Act 2006 (removal: persons with statutorily extended leave), (i) a decision that a person is to be removed from the United Kingdom by way of directions given by virtue of paragraph 10A of that Schedule (family), (ia) a decision that a person is to be removed from the United Kingdom by way of directions under paragraph 12(2) of Schedule 2 to the Immigration Act 1971 (c 77) (seamen and aircrews), (ib) a decision to make an order under section 2A of that Act (deprivation of right of abode), a decision to make a deportation order (j) under section 5(1) of that Act, and (k) under section 5(2) of that Act. refusal to revoke a deportation order 84. Grounds of appeal (1) An appeal under section 82(1) against an immigration decision must be brought on one or more of the following grounds (c) that the decision is unlawful under section 6 of the Human Rights Act 1998 (c 42) (public authority not to act contrary to Human Rights Convention) as being incompatible with the appellants Convention rights; that removal of the appellant from the (g) United Kingdom in consequence of the immigration decision would breach the United Kingdoms obligations under the Refugee Convention or would be unlawful under section 6 of the Human Rights Act 1998 as being incompatible with the appellants Convention rights. 92. Appeal from within United Kingdom: general (1) A person may not appeal under section 82(1) while he is in the United Kingdom unless his appeal is of a kind to which this section applies. (4) This section also applies to an appeal against an immigration decision if the appellant (a) has made an asylum claim, or a human rights claim, while in the United Kingdom, or 94. Appeal from within United Kingdom: unfounded human rights or asylum claim (1) This section applies to an appeal under section 82(1) where the appellant has made an asylum claim or human rights claim (or both). (2) A person may not bring an appeal to which this section applies in reliance on section 92(4)(a) if the Secretary of State certifies that the claim or claims mentioned in subsection (1) is or are clearly unfounded. 96. Earlier right of appeal (1) An appeal under section 82(1) against an immigration decision (the new decision) in respect of a person may not be brought if the Secretary of State or an immigration officer certifies (a) that the person was notified of a right of appeal under that section against another immigration decision (the old decision) (whether or not an appeal was brought and whether or not any appeal brought has been determined), (b) that the claim or application to which the new decision relates relies on a matter that could have been raised in an appeal against the old decision, and (c) that, in the opinion of the Secretary of State or the immigration officer, there is no satisfactory reason for that matter not having been raised in an appeal against the old decision. (2) An appeal under section 82(1) against an immigration decision (the new decision) in respect of a person may not be brought if the Secretary of State or an immigration officer certifies (a) that the person received a notice under section 120 by virtue of an application other than that to which the new decision relates or by virtue of a decision other than the new decision, (b) that the new decision relates to an application or claim which relies on a matter that should have been, but has not been, raised in a statement made in response to that notice, and that, in the opinion of the Secretary of (c) State or the immigration officer, there is no satisfactory reason for that matter not having been raised in a statement made in response to that notice. 113. Interpretation (1) In this Part, unless a contrary intention appears asylum claim means a claim made by a person to the Secretary of State at a place designated by the Secretary of State that to remove the person from or require him to leave the United Kingdom would breach the United Kingdoms obligations under the Refugee Convention, human rights claim means a claim made by a person to the Secretary of State at a place designated by the Secretary of State that to remove the person from or require him to leave the United Kingdom would be unlawful under section 6 of the Human Rights Act 1998 (c 42) (public authority not to act contrary to Convention) as being incompatible with his Convention rights, the Refugee Convention means the Convention relating to the Status of Refugees done at Geneva on 28 July 1951 and its Protocol, Part 5 of the 2002 Act was amended with effect from 20 October 2014 in a number of respects. Section 82(1) now provides: 82. Right of appeal to Tribunal (1) A person (P) may appeal to the Tribunal where the Secretary of State has decided to the Secretary of State has decided to (a) refuse a protection claim made by P, (b) refuse a human rights claim made by P, or (c) revoke Ps protection status. the Secretary of State has decided to (1) An appeal under section 82(1)(a) (refusal of protection claim) must be brought under one or more of the following grounds (a) that removal of the appellant from the United Kingdom would breach the United Kingdoms obligations under the Refugee Convention; Section 84 of the 2002 Act now provides: 84. Grounds of appeal (b) that removal of the appellant from the United Kingdom would breach the United Kingdoms obligations in relation to persons eligible for a grant of humanitarian protection; (c) that removal of the appellant from the United Kingdom would be unlawful under section 6 of the Human Rights Act 1998 (public authority not to act contrary to Human Rights Convention). (2) An appeal under section 82(1)(b) (refusal of human rights claim) must be brought on the ground that the decision is unlawful under section 6 of the Human Rights Act 1998. There were consequential amendments to sections 85, 86, 92, 94 and 96. Substantive changes were made to section 92 which now provides: 92. Place from which an appeal may be brought or continued (1) This section applies to determine the place from which an appeal under section 82(1) may be brought or continued. (2) In the case of an appeal under section 82(1)(a) (protection claim appeal), the appeal must be brought from outside the United Kingdom if (a) the claim to which the appeal relates has been certified under section 94(1) or (7) (claim clearly unfounded or removal to safe third country), or (b) Otherwise the appeal must be brought from within the United Kingdom. (3) In the case of an appeal under section 82(1)(b) (human rights claim appeal) where the claim to which the appeal relates was made while the appellant was in the United Kingdom, the appeal must be brought from outside the United Kingdom if (a) the claim to which the appeal relates has been certified under section 94(1) or (7) (claim clearly unfounded or removal to safe third country) or section 94B (certification of human rights claims made by persons liable to deportation), or Otherwise, the appeal must be brought from within the United Kingdom. In the case of an appeal under section 82(1)(b) (4) (human rights claim appeal) where the claim to which the appeal relates was made while the appellant was outside the United Kingdom, the appeal must be brought from outside the United Kingdom. Section 94 now provides in relevant part: 94. Appeal from within United Kingdom: unfounded human rights or protection claim (1) The Secretary of State may certify a protection claim or a human rights claim as clearly unfounded. The definition of human rights claim in section 113 was amended by the 2014 Act and now provides as follows: human rights claim means a claim made by a person to the Secretary of State at a place designated by the Secretary of State that to remove the person from or require him to leave the United Kingdom or to refuse him entry to the United Kingdom would be unlawful under section 6 of the Human Rights Act 1998 (c 42) (public authority not to act contrary to Convention). Immigration Rules, rule 353 The Immigration Rules have contained provisions in respect of previously refused applications since May 1994 (HC 395, rule 346). A rule in substantially the same form as the current rule 353 has been in force since it was introduced by HC 1112 in October 2004. (See para 36, below.) The current rule 353 of the Immigration Rules HC 1025, which has been in force since February 2015, provides: 353. When a human rights or protection claim has been refused or withdrawn or treated as withdrawn under paragraph 333C of these Rules and any appeal relating to that claim is no longer pending, the decision maker will consider any further submissions and, if rejected, will then determine whether they amount to a fresh claim. The submissions will amount to a fresh claim if they are significantly different from the material that has previously been considered. The submissions will only be significantly different if the content: had not already been considered; and (i) taken together with the previously considered (ii) material, created a realistic prospect of success, notwithstanding its rejection. This paragraph does not apply to claims made overseas. The decision of the Court of Appeal In the Court of Appeal Jackson LJ, with whom the other members of the court agreed, rejected a submission on behalf of the appellant that human rights claim in section 82(1)(b) of the 2002 Act as amended means any human rights claim and that its meaning is not confined to an original claim or a subsequent claim which constitutes a fresh claim within rule 353 of the Immigration Rules. He also rejected a submission that the Supreme Court considered precisely the same question in R (BA (Nigeria)) v Secretary of State for the Home Department [2009] UKSC 7; [2010] 1 AC 444 when construing the phrase a human rights claim in section 92(4)(a) of the 2002 Act as it then stood. The decision of the Supreme Court on the meaning of human rights claim in BA (Nigeria) did not apply to statutory provisions which determine whether a right of appeal exists at all. In his view, it would be an absurd reading of section 82, in either its previous or current form, to interpret it as permitting an applicant to make the same human rights claim over and over again, each time appealing to the FTT against the rejection of that claim. He concluded that a human rights claim in section 82(1)(b) of the 2002 Act must mean an original human rights claim or a fresh human rights claim which falls within rule 353 of the Immigration Rules. Submissions of the parties On this appeal the parties have made very detailed submissions orally and in writing for which the court is grateful. It seems to me, however, that Mr Michael Fordham QC on behalf of the appellant makes two essential submissions which lie at the heart of his case. (1) First, he submits that the Onibiyo line of authority which established that in the case of a second or successive submission it was for the Secretary of State to decide whether this constituted a fresh claim giving rise to a right to appeal did not survive the decision of the Supreme Court in BA (Nigeria), and that, accordingly, there is no longer any role for rule 353 of the Immigration Rules. In this regard he submits that this court should reject the reading of BA (Nigeria) favoured by Lord Neuberger of Abbotsbury MR in the Court of Appeal in R (ZA (Nigeria)) v Secretary of State for the Home Department [2010] EWCA Civ 926; [2011] QB 722. (2) Secondly, he submits that the amendments to Part 5 of the 2002 Act effected by the 2014 Act abrogate the control mechanism established by the Onibiyo line of authority and rule 353 of the Immigration Rules and that the words human rights claim as they appear in section 82(1)(b) of the 2002 Act following amendment by the 2014 Act are to be interpreted without reference to rule 353. On this basis he submits that any second or subsequent submission which is a human rights claim under section 113(1) attracts a right of appeal under section 82, notwithstanding that the individual has made a previous claim that removal would breach a relevant obligation, whether the same relevant obligation or a different one, whether on the same basis or a different one, whether with the same or different submissions and evidence, but subject however to the certification provisions in sections 94 and 96. In response on behalf of the Secretary of State, Sir James Eadie QC submits: (1) BA (Nigeria) does not establish that the words human rights claim as they appear in Part 5 of the 2002 Act are to be interpreted without reference to the Onibiyo line of authority or rule 353 of the Immigration Rules. The actual decision in BA (Nigeria) was that rule 353 had no further part to play for the purposes of section 92(4)(a) once there was an appeal against an immigration decision. It did not determine that the Secretary of State was no longer entitled to decide the prior question as to whether a second or subsequent submission constituted a claim at all. In his support he relies on the analysis of BA (Nigeria) by Lord Neuberger MR in ZA (Nigeria). (2) The amendments to the 2002 Act effected by the 2014 Act have not changed the position. It remains the case that there will only be an asylum or human rights claim to be determined if, in relevant cases, further submissions are considered to amount to a fresh claim. The Onibiyo line of authority In order to address the issues raised by this appeal it is necessary to consider in some detail the way in which a line of authority concerning second or subsequent submissions to the Secretary of State has developed. It starts in 1996 with the decision of the Court of Appeal (Sir Thomas Bingham MR, Roch and Swinton Thomas LJJ) in Onibiyo. The applicant had made an application for asylum under the Asylum and Immigration Appeals Act 1993 (1993 Act), based on the political activities of his father. The Secretary of State refused his application and his appeal under section 8(3)(b) of the 1993 Act was dismissed. The applicant then indicated that he was making a fresh claim for asylum based on his own association with the opposition in Nigeria. Rule 346, Statement of Changes in Immigration Rules (1994) (HC 395), which was then current, provided: When an asylum applicant has previously been refused asylum in the United Kingdom and can demonstrate no relevant and substantial change in his circumstances since that date, his application will be refused. The Home Office stated in a letter that it was of the view that the representations did not constitute a fresh claim for asylum and had been treated as further information to the original claim. The request for revocation of the deportation order against him was refused on the ground that there had not been any material change in circumstances since the previous refusal decision sufficient to justify revocation. The applicants solicitors took issue with this letter and submitted a notice of appeal to a special adjudicator under section 8(3)(b) of the 1993 Act. The Secretary of State maintained his position and in a subsequent letter explained that the first letter had not constituted a refusal of asylum but a consideration and dismissal of the further information provided. In the circumstances the Secretary of State had not made a fresh decision and the appeal was invalid. The applicant applied for judicial review. A preliminary question was whether a person may during a single uninterrupted stay in the United Kingdom make more than one claim for asylum within the 1993 Act. The Master of the Rolls, with whom the other members of the court agreed, rejected the submission of the Secretary of State that once a person had made a claim for asylum, been refused by the Secretary of State and unsuccessfully exercised his rights of appeal, that exhausted his legal rights. The obligation of the United Kingdom under the Refugee Convention not to return a refugee to a county where his life or freedom would be threatened for a Convention reason remained binding until the moment of return. Accordingly, three questions arose for consideration. First, what constitutes a fresh claim? Secondly, how and by whom is it decided whether a claim is a fresh claim or not? Thirdly, what are the procedural consequences of a decision that a claim is or is not a fresh claim? In response to the first question, it was not controversial that there had to be a significant change from the claim as previously presented, such as might reasonably lead a special adjudicator to take a different view. The acid test must always be whether, comparing the new claim with that earlier rejected, and excluding material on which the claimant could reasonably have been expected to rely in the earlier claim, the new claim is sufficiently different from the earlier claim to admit of a realistic prospect that a favourable view could be taken of the new claim despite the unfavourable conclusion reached on the earlier claim. (at pp 783H 784B) In response to the second question, rule 328 of the Statement of Changes in Immigration Rules made clear that all asylum applications would be determined by the Secretary of State in the first instance. In response to the third question, no particular difficulty arose where the Secretary of State treated the submission as a fresh claim, whether asylum was then granted or refused. In the latter case, the same consequences should follow as on a refusal of an initial claim. A problematic situation arose, however, where, as on the facts of that case, the Secretary of State did not recognise the submission as a fresh claim and, therefore, declined to take or omit to take any action which would trigger a right of appeal. It would clearly be open to the asylum seeker, in those circumstances, to have resort to the court to challenge that decision. However, a question of considerable difficulty was whether the court should approach this as a question of precedent fact or whether the decision should be susceptible to challenge only on Wednesbury principles. As the answer to the question was not determinative of the appeal, the Master of the Rolls proffered a tentative answer in favour of the latter view. (at pp 784D 785D) Following the decision in Onibiyo, rule 346 was amended to reflect the judgment in that case. The amended version provided: Where an asylum applicant has previously been refused asylum the Secretary of State will determine whether any further representations should be treated as a fresh application for asylum. The Secretary of State will treat representations as a fresh application for asylum if the claim advanced in the representations is sufficiently different from the earlier claim that there is a realistic prospect that the conditions set out in para 334 will be satisfied. In considering whether to treat the representations as a fresh claim, the Secretary of State will disregard any material which: is not significant; or is not credible; or (i) (ii) (iii) was available to the applicant at the time when the previous application was refused or when any appeal was determined. (CM 3365) In Cakabay v Secretary of State for the Home Department (Nos 2 and 3) [1999] Imm AR 176, after the appellants appeals against the refusal of asylum had been dismissed, he had submitted further evidence which the Secretary of State concluded did not constitute a fresh claim. The appellant purported to appeal against this decision. The Secretary of State successfully applied for a declaration that the appellate authorities had no jurisdiction in the matter. The judge, reviewing the decision on Wednesbury principles, also concluded that the Secretary of States decision could not be held to be unreasonable. The Court of Appeal (Peter Gibson, Schiemann and Potter LJJ) upheld the decision. Schiemann LJ explained that the statute made no express provision as to what is to be done in the case of repeated claims for asylum by the same person. Nevertheless, there was a need for categorisation and to distinguish between what he termed a repetitious claim and a fresh claim: In the case of a repetitious claim no more is required to be done: the first decision has ensured that the United Kingdom has complied with its obligations under the Convention. Section 6 of the 1993 Act creates no inhibition on the claimants removal: the Secretary of State has on the occasion of his decision on the first claim decided the repetitious claim. So far as the decision on the claimants repetitious application for leave to enter is concerned, the claimant will be told that leave has already been refused and that there is no need for any new decision. (at p 181) Despite the focus on repetitious claims, it is clear that the reasoning of Schiemann LJ applies equally to any further submissions that failed to meet the test in rule 346. Similarly, Peter Gibson LJ (at p 193) considered that if the representations amounted to no more than the same claim as that which had already failed, or if the criteria of rule 346 were not met, there would be no claim for asylum within the statute and therefore no appeal would lie under section 8(1) of the 1993 Act against a determination adverse to the asylum seeker that there had been no fresh claim. Consistently with what the Court of Appeal in Onibiyo had assumed to be correct, the court went on to hold that no appeal lay under section 8(1) of the 1993 Act from the determination of the Secretary of State that fresh representations do not amount to a claim for asylum. Schiemann LJ accepted that a categorisation decision has potentially severe consequences and that, in such a context, arguments based on the possibilities of abuse should not weigh heavily in matters of construction. Nevertheless, Parliament had not provided for an appeal on the merits against a categorisation decision (at p 185 186). (See also Peter Gibson LJ at p 194.) In this way the courts imposed a gloss on the operation of the statutory scheme which made no express provision for the handling of second or successive submissions. The effect of these decisions was that it was for the Secretary of State to decide whether further submissions amounted to a fresh claim. Where the Secretary of State had taken a rational decision that further submissions did not amount to a fresh claim for asylum under rule 346 of the Immigration Rules, there was no asylum claim to determine and therefore no need to make any decision to refuse leave to enter. In these circumstances, no right of appeal arose under section 8 of the 1993 Act. A categorisation decision was, however, open to challenge by judicial review. On 7 November 2002 Parliament enacted the 2002 Act, which effectively replaced the 1993 Act. The 2002 Act itself has subsequently been amended on a number of occasions. Part 5 of the 2002 Act concerns immigration and asylum appeals. Section 82 conferred a statutory right of appeal against an immigration decision and listed what constituted an immigration decision. The grounds of appeal included in section 84(1)(g) that removal would breach the United Kingdoms obligations under the Refugee Convention or would be unlawful under section 6 of the Human Rights Act 1998 as being incompatible with the appellants Convention rights. Section 92 required an appeal to be out of country unless it concerned one of five of the immigration decisions listed in section 82(2) or the individual had made an asylum or human rights claim. Section 94 empowered the Secretary of State to issue a certificate that an asylum or human rights claim was clearly unfounded, in which case an appeal would be limited to an out of country appeal. Section 96 empowered the Secretary of State to issue a certificate relating to an earlier right of appeal in which a matter now relied upon could and should have been raised, in which case an appeal could not be brought at all. In October 2004 rule 353 was introduced (HC 1112). 353. When a human rights or asylum claim has been refused and any appeal relating to that claim is no longer pending, the decision maker will consider any further submissions and, if rejected, will then determine whether they amount to a fresh claim. The submissions will amount to a fresh claim if they are significantly different from the material that has previously been considered. The submissions will only be significantly different if the content: had not already been considered; and (i) taken together with the previously considered (ii) material, created a realistic prospect of success, notwithstanding its rejection. This paragraph does not apply to claims made overseas. Rule 353A was inserted by HC 82/2007. 353A. Consideration of further submissions shall be subject to the procedures set out in these Rules. An applicant who has made further submissions shall not be removed before the Secretary of State has considered the submissions under paragraph 353 or otherwise. This paragraph does not apply to submissions made overseas. In WM (DRC) v Secretary of State for the Home Department [2006] EWCA Civ 1495; [2007] Imm AR 337 the Court of Appeal (Buxton, Parker and Moore Bick LJJ) confirmed (per Buxton LJ at paras 8 10) that there is no provision for appeal from a decision of the Secretary of State as to the existence of a fresh claim and, accordingly, the court was engaged only through the medium of judicial review. The Secretary of States decision as to whether there was a fresh claim was not a fact, nor precedent to any other decision, but was the decision itself. The court could not take that decision out of the hands of the decision maker. The decision remained that of the Secretary of State, subject only to review on a Wednesbury basis, albeit applying anxious scrutiny. In ZT (Kosovo) v Secretary of State for the Home Department [2009] UKHL 6; [2009] 1 WLR 348 the House of Lords by a majority extended the applicability of the Onibiyo approach. The Secretary of State had rejected the applicants claims for asylum and protection on human right grounds and certified the claims as clearly unfounded under section 94(2) of the 2002 Act. As a result, the applicant had no in country right of appeal and he was served with a decision to remove him as an illegal immigrant. He made two further submissions, but the Secretary of State maintained her certification of the claims as clearly unfounded. The House of Lords held by a majority (Lord Hope dissenting) that the Secretary of State had erred in applying section 94(2) of the 2002 Act rather than rule 353 to the further submissions. The words any appeal relating to that claim is no longer pending in rule 353 should be interpreted in accordance with the definition of a pending appeal in section 104 of the 2002 Act. If there was no appeal pending, the qualifying words had no application. Furthermore, it made sense that the rule should be disapplied during, and only during, the currency of an appeal since if an appeal was pending further submissions could be made to the appeal tribunal. As Lord Neuberger observed (at para 86), it would seem silly if rule 353 only applied after an appeal had been brought and concluded but did not apply before an appeal was brought and could never apply in a case where no appeal had been brought. BA (Nigeria) Some nine months after the House of Lords delivered its decision in ZT (Kosovo) on 4 February 2009, the Supreme Court delivered its decision in BA (Nigeria) on 26 November 2009. Mr Fordhams primary submission is that the Onibiyo line of authority did not survive the decision of the Supreme Court in BA (Nigeria) and that, accordingly, there is no longer any role for rule 353 of the Immigration Rules. BA (Nigeria) concerned two separate cases. BA, who had previously been granted indefinite leave to remain, was served with a decision that he would be deported on his release from prison on licence from a sentence of imprisonment of ten years. He appealed on human rights grounds against that decision and his appeal failed. He was served with a deportation order. BA then made further submissions as to why he should not be deported. The Secretary of State agreed to consider his reasons for seeking revocation of the deportation order but declined to revoke it. Directions were then given for his removal. The other case was that of PE who had entered the United Kingdom clandestinely. His application for asylum was rejected by the Secretary of State. It was decided that directions were to be given for his removal to Cameroon. He did not appeal against that decision. Before it was put into effect, however, he was convicted and sentenced to imprisonment for having a forged passport and using it to obtain work. The Secretary of State decided to make a deportation order against him. PE appealed unsuccessfully against that decision on asylum and human rights grounds. The deportation order was signed and served on him, following which his representatives made written representations for the decision to be reconsidered. In particular, it was claimed that he would be persecuted in Cameroon on account of his homosexuality. The Secretary of State declined to reconsider her decision; in her view the representations did not amount to a fresh claim within rule 353. PE purported to appeal against that decision but the tribunal held that it was not an appealable decision. Both BA and PE applied for judicial review. In each of these cases the refusal of the Secretary of State to revoke the deportation order following further representations was accepted to be an immigration decision within section 82(2)(k). It was common ground, accordingly, that each applicant had a right of appeal under section 82(1). It was also common ground that neither of the claims would have been certifiable under section 94 or section 96 (although it appears that the Secretary of State took this position solely because, so far as section 94 was concerned, it applied only where the appellant has made an asylum claim or a human rights claim (or both)). The issue was whether the right of appeal could be exercised from within the United Kingdom. (See Lord Hope DPSC at para 14.) Section 92(1) precluded an appeal under section 82(1) by a person while he is in the United Kingdom, unless his appeal was of a kind to which section 92 applied. Section 92, by virtue of section 92(4)(a), applied to an appeal against an immigration decision if the appellant has made an asylum claim, or a human rights claim, while in the United Kingdom so that in such a case there would be a right to an in country appeal. Lord Hope encapsulated the issue (at para 2): The question is whether the expression an asylum claim, or a human rights claim, in section 92(4)(a) of the 2002 Act includes any second or subsequent claim that the asylum seeker may make, or only a second or subsequent claim which has been accepted as a fresh claim by the Secretary of State under rule 353 of the Statement of Changes in Immigration Rules (1994) (HC 395). The Supreme Court (Baroness Hale JSC dissenting) held that it was not open to the Secretary of State to rely on rule 353 and the Onibiyo reasoning to deny an in country right of appeal in those circumstances. As Lord Neuberger MR observed in ZA (Nigeria) at para 52, the actual decision in BA (Nigeria) was that rule 353 had no further part to play for the purposes of section 92(4)(a) once there was an appeal against an immigration decision. However, the reasoning by which the Supreme Court reached that conclusion is open to different interpretations which were formulated by Lord Neuberger in ZA (Nigeria) in the following terms (at para 51). Like the Administrative Court, I have not found it entirely easy to resolve the issue of whether the Supreme Court was saying (a) as the claimants contend, that rule 353 has no part to play at all following the introduction of Part 5 of the 2002 Act, or (b) as the Secretary of State argues, that rule 353 has no part to play where there has been an appealable immigration decision and the only issue is whether the appeal is of a kind to which section 92 applies. Ultimately, however, again like the Administrative Court, I have come to the conclusion that the Secretary of States more limited interpretation is to be preferred. In the present appeal, Mr Fordham has sought to persuade us that the broader reading of BA (Nigeria) is correct and that the narrower reading favoured by Lord Neuberger in ZA (Nigeria) is incorrect. Mr Fordham is able to point to certain passages in the judgment of Lord Hope in BA (Nigeria) (with which Lord Scott, Lord Rodger and Lord Brown agreed) which certainly lend support to the view that the new scheme introduced by the 2002 Act has rendered the reasoning in Onibiyo and rule 353 redundant. I draw attention, in particular, to the following passages. (1) Lord Hope (at para 29), referring to section 94(2) and section 96, noted that the new system introduced by Part 5 of the 2002 Act contains a range of powers that enable the Secretary of State or an immigration officer to deal with the problem of repeat claims. It was common ground that the present cases were not certifiable under either of these two sections. Why then, he asked rhetorically, should they be subjected to a further requirement which is not mentioned anywhere in the 2002 Act. He continued: It can only be read into the Act by, as Sedley LJ in the Court of Appeal put it, glossing the meaning of the words a claim so as to exclude a further claim which has not been held under rule 353 to be a fresh claim The court had to do this in Ex p Onibiyo But there is no need to do this now. It is not just that there is no need now to read those words into the statute. As Mr Husain pointed out, the two systems for excluding repeat claims are not compatible. (at paras 29, 30) (2) At para 31 Lord Hope observed: The ground of appeal referred to in section 84(1)(g) has been designed to honour the international obligations of the United Kingdom. To exclude claims which the Secretary of State considers not to be fresh claims from this ground of appeal, when claims which he certifies as clearly unfounded are given the benefit of it, can serve no good purpose. On the contrary, it risks undermining the beneficial objects of the Refugee Convention which the court in Ex p Onibiyo , under a legislative system which had no equivalent to section 95, was careful to avoid. (3) At para 33 Lord Hope observed: There is no doubt, as I indicated in ZT (Kosovo) v Secretary of State for the Home Department , para 33, that rule 353 was drafted on the assumption that a claimant who made further submissions would be at risk of being removed or required to leave immediately if he does not have a fresh claim. That was indeed the case when this rule was originally drafted, as there was no equivalent of section 92(4) of the 2002 Act. But Mr Husains analysis has persuaded me that the legislative scheme that Parliament has now put in place does not have that effect. Its carefully interlocking provisions, when read as a whole, set out the complete code for dealing with repeat claims. Rule 353, as presently drafted, has no part to play in the legislative scheme. As an expression of the will of Parliament, it must take priority over the rules formulated by the executive. Rule 353A on the other hand remains in place as necessary protection against premature removal until the further submissions have been considered by the Secretary of State. Similarly, Lord Rodger (at para 37), rejecting the submission that the expression an asylum claim in section 92(4)(a) should be given the same meaning as Sir Thomas Bingham MR gave to the expression a claim for asylum in section 6 of the 1993 Act, noted that the contexts were significantly different since the 2002 Act contains a new scheme for dealing with abusive claims. Given that new scheme, there is no longer the same need to adopt the former interpretation and, indeed, the one now adopted fits the new context better. Lord Brown (at para 44) explained that he had reached his conclusion only on the basis that: the statutory solution to the problem of abuse created by the making of repeat asylum claims lies not in construing an asylum claim in section 92(4)(a) of the Nationality, Immigration and Asylum Act 2002 as the Court of Appeal in R v Secretary of State for the Home Department, Ex p Onibiyo construed a claim for asylum in section 6 of the Asylum and Immigration Appeals Act 1993 but rather in the Secretary of State issuing certificates where appropriate under sections 94 or 96 of the 2002 Act (no equivalent provisions having been available under the 1993 Act). Nevertheless, there are to my mind major difficulties inherent in this reading of BA (Nigeria). Here I find myself in total agreement with the reasoning of Lord Neuberger on this point in ZA (Nigeria) which I gratefully acknowledge. First, in principle there is no conflict between Onibiyo and rule 353 on the one hand and the statutory scheme in Part 5 of the 2002 Act on the other. I note that when Onibiyo was decided in 1996 there was in force a system of certification under paragraph 5 of Schedule 2 to the 1993 Act which established special appeal procedures for claims without foundation. With respect to Lord Hope, I do not consider that there is any incompatibility between what he described as the two systems for excluding repeat claims. They operate at different stages of the response to a purported renewed claim. BA (Nigeria) establishes that, as the statutory provisions then stood, where the Secretary of State receives further submissions on which he makes an immigration decision within section 82 there will, in the absence of certification, be an in country right of appeal. It decides that in those circumstances it is not then open to the Secretary of State to rely on the Onibiyo reasoning or rule 353 in order to contend that the submissions did not amount to a claim and that, as a result, there is no need for a decision and no entitlement to a statutory appeal. It is entirely understandable that in such a case there is no room for the operation of rule 353. Onibiyo and rule 353, by contrast, address a prior issue, namely whether there is a claim which requires a decision at all. Secondly, I do not consider that the effect of the machinery introduced by Part 5 of the 2002 Act, in particular the powers of certification under sections 94 and 96, is to render the Onibiyo reasoning and rule 353 redundant. As Lord Neuberger observed in ZA (Nigeria) (at para 24), the issue should not be decided simply by seeing whether sections 94 and 96 can be interpreted so as to cover every application falling within rule 353, as it is equally valid to consider whether they can be construed consistently with rule 353 having an independent effect. In my view, rule 353 continues to perform a useful role notwithstanding the machinery introduced by Part 5 of the 2002 Act. (1) Section 94 applies to claims which are clearly unfounded, whether they are original claims or purported renewed claims. By contrast, rule 353 applies only to supplemental submissions which purport to be claims. (2) The effect of certification under section 94 is to limit an appeal to an out of country appeal. Certification under section 96 has the effect that an appeal under section 82(1) may not be brought. The effect of rule 353 is that no right of appeal ever arises. (3) As indicated above, where it applies rule 353 operates at a prior stage to section 94. In the case of a purported renewed claim there is a legitimate preliminary issue as to whether it constitutes a claim requiring a decision on the merits at all. Rule 353 addresses that issue. Section 94, on the other hand, proceeds on the basis that there is a valid claim which requires consideration on the merits and a decision. It creates a machinery of certification of the claim as clearly unfounded so as to prevent an in country appeal. (4) The fact that section 94 applies to both original and purported renewed claims does not deprive rule 353 of its utility in relation to the latter category. In appropriate cases, rule 353 relieves the Secretary of State from taking a decision on the merits of the application and refusing it. It operates by enabling him to reject the submissions as not constituting a claim requiring decision. Section 94, however, comes into play only when the Secretary of State has considered a claim on its merits and refused it. At that stage, certification operates to block a right to an in country appeal which would otherwise arise. Thus rule 353 can be operated as a sort of gatekeeper by the Secretary of State to prevent further submissions amounting to, or being treated as, a claim, thereby not getting into Part 5 territory at all. (ZA (Nigeria) per Lord Neuberger MR at para 26) With respect to Mr Fordham, it is not the case that this interposing function arose only because of the additional requirement of an immigration decision in the pre 2014 statutory list in section 82(1) of the 2002 Act. On the contrary, it is founded on the need to identify what constitutes a claim for this purpose. (5) Section 96(1) addresses a different aspect of renewed claims from rule 353. Section 96(1) applies where a person seeks to rely on a matter that could have been raised in an earlier appeal against an immigration decision and the Secretary of State or the immigration officer considers that there is no satisfactory reason for the failure to do so. It is, in a sense, the converse of the situation addressed by rule 353. (6) Part 5 as originally enacted included a subsection 96(3) which provided: (3) A person may not rely on any ground in an appeal under section 82(1) if the Secretary of State or an immigration officer certifies that the ground was considered in another appeal under that section brought by that person. This provision was much closer to rule 353 than is section 96(1) as both rule 353 and section 96(3) address similar situations. However, section 96(3) did not achieve its effect by denying the existence of a claim requiring a decision on the merits, but by requiring such a renewed claim to be treated as a fresh claim and enabling the Secretary of State to block an appeal on the particular ground which had been raised previously. In any event, section 96(3) is no longer in force, having been repealed by section 30 of the Asylum and Immigration (Treatment of Claimants, etc) Act 2004 with effect from 1 October 2004. Thirdly, there are features of the regulatory scheme which are difficult to reconcile with an intention on the part of Parliament that provisions in Part 5 of the 2002 Act should provide a comprehensive and exclusive code for dealing with repeat claims and that rule 353 should no longer be effective. (1) When the 2002 Act was enacted there was no attempt to repeal or amend rule 346, the predecessor to rule 353. (2) Parliament has approved subsequent amendments to the Immigration Rules which have not included the deletion of rule 353 which remains in force. (3) Section 53 of the Borders, Citizenship and Immigration Act 2009 (the 2009 Act) amended section 31A of the Senior Courts Act 1981 to permit transfer from the High Court to the Upper Tribunal of judicial review applications where: the application calls into question a decision of the Secretary of State not to treat submissions as an asylum claim or a human rights claim wholly or partly on the basis that they are not significantly different from material that has previously been considered As Lord Neuberger observed in ZA (Nigeria) (at para 19), here Parliament has plainly legislated on the basis that rule 353 is still in force and section 53 of the 2009 Act would have been positively meaningless if rule 353 had no further function. (4) Following the amendment of the 2002 Act by the 2014 Act, rule 353 was amended so as to ensure that it applies to human rights claims and protection claims (HC 1025). Once again, this is inconsistent with the suggestion that rule 353 had become ineffective. These features strongly suggest that rule 353 continues to perform an important function. Fourthly, I am persuaded that the broad reading of BA (Nigeria) for which the appellant contends is inconsistent with ZT (Kosovo) where the House of Lords held (Lord Hope dissenting) that the Secretary of State had erred in applying section 94(2) of the 2002 Act rather than rule 353 in considering the applicants further submissions. By contrast, there is no difficulty in reconciling the two decisions if the ratio decidendi of BA (Nigeria) is merely that rule 353 has no part to play where there is an appealable immigration decision. If the Supreme Court did decide in BA (Nigeria) that rule 353 is entirely redundant following the introduction of Part 5 of the 2002 Act, it must have intended to overrule or to depart from the decision of the House of Lords some nine months earlier in ZT (Kosovo). However, BA (Nigeria) contains no express statement to that effect. Moreover, while an earlier decision may be impliedly overruled, it is extremely improbable that this was the intention here, for reasons summarised by Lord Neuberger in ZA (Nigeria) as follows (at para 53): I have great difficulty with the notion that the later case relied on by the claimants overruled the earlier case. (i) Both decisions relate to a much litigated issue, and the earlier decision was given less than a year before the later decision; (ii) the point at issue was directly addressed and decided in all five reasoned judgments in the earlier decision, and even the reasoning of the dissenter would have to be treated as overruled; (iii) the earlier decision is expressly referred to three times in the leading judgment, and once in the only other reasoned judgment, in the later decision without apparent disapproval, and both judgments were given by judges involved in the earlier decision; (iv) the actual outcome in the later decision can perfectly easily be reconciled with the earlier decision, namely on the basis that the later decision is limited to further submissions which have been treated as a fresh claim; (v) this more limited interpretation of the later decision is consistent with the Court of Appeals reasoning and conclusion in that case, which was specifically approved by the Supreme Court; (vi) this more limited interpretation of the later decision is also consistent with a recent statute, whereas the wider interpretation, which would involve overruling the earlier decision, is not. For these reasons I agree with the Court of Appeal in ZA (Nigeria) that what is said in BA (Nigeria) is limited to cases where there is an appealable decision. As Lord Neuberger explained: Once there is such a decision, the complete code contained in the legislative scheme applies and rule 353 has no part to play. However, as decided in ZT (Kosovo) , rule 353 still has a part to play: the Secretary of State can decide that the further submissions are not a fresh claim, in which case one does not enter the territory governed by the complete code of the legislative scheme. (ZA (Nigeria) at para 59) For these reasons, I consider that Mr Fordhams primary case is not made out. The 2014 amendments to the 2002 Act Part 5 of the 2002 Act was substantially amended by the 2014 Act which restructured rights of appeal. The most relevant provisions as amended are set out at paras 19 to 23 above. Section 82 no longer restricts a right of appeal to an appeal against an immigration decision as formerly listed in section 82(2). In particular, there is no longer any right of appeal in respect of a decision to make a deportation order or a refusal to revoke such an order per se. Instead a person may appeal where the Secretary of State has decided to refuse a protection claim or a human rights claim made by that person or has decided to revoke that persons protection status. Post 2014 authority Before drawing conclusions as to the impact of the 2014 amendments to the 2002 Act on the present proceedings, it is convenient to consider the more recent decisions on this point. In Waqar v Secretary of State for the Home Department [2015] UKUT 169 (IAC) the appellant contended that the Secretary of States decision not to treat his further submissions as amounting to a fresh claim for the purposes of rule 353 amounted to a refusal of a human rights claim under section 82 as amended. The appellant maintained that rule 353 is now subsumed within the statutory provisions and that a right of appeal under section 82 as amended arises in all refused human rights claims, subject only to certification under sections 94 or 96. It was submitted that there is no longer a requirement for a categorisation step because the statutory framework now provides all necessary safeguards against repetitious or unmeritorious claims. In rejecting the submission, the Upper Tribunal (UTJ Coker, UTJ Kebede) held (at paras 18, 19, 20) that BA (Nigeria) is not authority for the proposition that submissions amount to a claim and that the response to those submissions is a decision within the meaning of Part 5. Submissions that purport to be a human rights claim do not without more trigger a right of appeal. There has to be an intermediate categorisation in which rule 353 provides the mechanism to determine whether they amount to a claim. If they do not, the decision is not a decision to refuse a human rights claim. In R (MG) v First tier Tribunal (Immigration and Asylum Chamber) [2016] UKUT 283 (IAC) the applicant had made a claim for asylum which had been rejected and his appeal had been dismissed. Further submissions on his behalf were rejected by the Secretary of State who maintained the earlier decision that he did not qualify for asylum and concluded that the further representations were not a fresh claim. The applicant lodged a notice of appeal with the First tier Tribunal which rejected it because no notice of an appealable decision had been issued. On a challenge to that decision by way of judicial review it was submitted, without taking issue with the decision of the Upper Tribunal in Waqar, that as a result of Parliaments decision to grant a right of appeal from a refusal of a protection claim the judge in the First tier Tribunal has jurisdiction to decide whether there had been a decision to refuse a protection claim. The Upper Tribunal (Blake J and UTJ Grubb) rejected the submission. In our view, notwithstanding the significant change in section 82 from a right of appeal against an immigration decision on a protection ground to a right of appeal against a protection decision itself, Parliament can be presumed to have legislated against the background of satisfaction with the previous law as declared in ZA (Nigeria). There is no indication in the amendments made, that it was intended to transfer responsibility for the categorisation decision of whether a claim is a fresh claim to the FtT. Indeed, the general purpose of the 2014 amendments was to reduce the appellate jurisdiction of the FtT. (at para 14) They further held that an assessment of whether a protection claim is a fresh claim is not a question of jurisdictional fact but a matter of assessment and evaluation for the Secretary of State subject to supervision by judicial review. Furthermore, when the Secretary of State concludes that the claim before her is not a fresh claim she does not refuse a protection claim. In R (Sharif Hussein) v First Tier Tribunal (para 353: present scope and effect) IJR [2016] UKUT 409 (IAC); [2017] Imm AR 84 the applicants appeal against a deportation order had been dismissed. He made further submissions in support of a request to revoke the order which were rejected by the Secretary of State who also concluded that they did not amount to a fresh claim within rule 353. The First tier Tribunal held that there was no exercisable right of appeal. The issue in the judicial review which followed was to what extent, if at all, the Secretary of State could utilise rule 353 to preclude the applicant from appealing to the First tier Tribunal under section 82. The applicant, first, relied on the judgment of Lord Hope in BA (Nigeria) in support of the proposition that rule 353 had no part to play following the introduction of Part 5 of the 2002 Act. Secondly, he submitted that the effect of the 2014 amendments to the 2002 Act was that rule 353 no longer applied to the categorisation issue as to whether submissions were a claim within section 82 and was now relevant only to certification issues. The Upper Tribunal (Dove J and Peter Lane UTJ) rejected both submissions. It was bound by ZA (Nigeria) to reject the first submission. With regard to the second submission it considered that despite the changes made by the 2014 Act the concept of a claim remained central to the new section 82. It also noted that if Parliament had intended to limit rule 353 to certification decisions, it would have been amended to make that clear. In fact, the amendment to rule 353 made following the 2014 Act to ensure that it applies to human rights claims and protection claims demonstrated that it was intended to have continuing effect. These matters have been considered recently by the Court of Appeal (Arden and Sales LJJ) in Secretary of State for the Home Department v VM (Jamaica) [2017] EWCA Civ 225; [2017] Imm AR 1237, a judgment delivered shortly before that of the Court of Appeal in the present case. Sales LJ described the relationship of section 82(1) and rule 353 in the clearest terms (at para 28): Section 82(1) and paragraph 353 of the Immigration Rules operate in combination. If the Secretary of State decides that new representations in relation to some earlier decision (whether of her own or by the tribunal) which is now final and closed do not amount to a fresh claim under paragraph 353 she will simply reject the representations as matters which do not affect the position of the applicant within the regime of immigration law. In that sort of case, on the assessment of the Secretary of State the representations do not amount to a claim by the applicant, so her decision is not a decision to refuse a human rights claim (or any other sort of claim) within the scope of section 82(1). No right of appeal arises in relation to her decision that the new representations do not amount to a fresh claim. Such a decision can only be challenged by way of judicial review. On this point I agree with the decision of the UT in Waqar v Secretary of State for the Home Department (Statutory Appeals/paragraph 353) [2015] UKUT 169 (IAC) at paras 19 20. The effect of the 2014 amendments The second principal submission on behalf of the appellant is that the amendments made in 2014 to Part 5 of the 2002 Act have effected a fundamental change in the operation of the statutory scheme with the result that, whatever may have been the position after BA (Nigeria), rule 353 no longer applies and accordingly no longer performs a gatekeeper function. First, on behalf of the appellant, Mr Fordham points to the fact that section 82, as amended, now confers a right of appeal where the Secretary of State has decided to refuse a human rights claim (section 82(1)(b)). Human rights claim is defined by section 113(1) for the purposes of Part 5 unless a contrary intention appears. Mr Fordham submits that this is striking because the question of the Part 5 meaning of human rights claim is the same question that previously arose for decision in the Supreme Court in BA (Nigeria) which established that those words, as they appear in Part 5 of the 2002 Act, are to be interpreted without reference to rule 353. Thus, he submits, a second or subsequent human rights claim is a human rights claim for the purpose of those statutory provisions regardless of whether the Secretary of State accepts or refuses to accept that the claim is a fresh claim within rule 353. I am unable to accept this submission. In BA (Nigeria) the Supreme Court considered that there was, in each of the cases, a human rights claim within section 92(4)(a) and, therefore, an appeal would be an in country right of appeal, subject to the possibility of certification which did not arise in that case. However, the reason there was an entitlement to appeal there was because the human rights claims had resulted, in each case, in a refusal to revoke a deportation order which was a qualifying immigration decision under section 82(2)(k). It was this which excluded the operation of rule 353. Consequently, the present issue is not the same issue that previously arose for consideration in BA (Nigeria). The issue in the present case, as previously explained, is the prior question of whether there is a claim at all. For the same reason, it is not the case that rejection of Mr Fordhams submission results in the same words bearing different meanings in different sections within Part 5 of the 2002 Act. Secondly, Mr Fordham relies on the fact that the 2014 amendments remove the former requirement of an immigration decision to which the human rights claim and its rejection needed to have a nexus. He submits that the effect of the simplified scheme is that any submission that removal would breach a relevant obligation will amount to a human rights or protection claim, the rejection of which will give rise to a right of appeal. Once again, I am unable to accept this submission. The appellant is not assisted by the fact that under the amended section 82 there is no longer a requirement to establish an immigration decision within the list previously set out in section 82(2). In fact, the contrary is the case. A decision to refuse to revoke a deportation order was formerly an immigration decision under section 82(2)(k) and therefore gave rise to an in country right of appeal, subject to the possibility of certification, but this is no longer the case. The 2014 amendments limit immigration appeals to circumstances in which there has been a refusal of a protection claim or a human rights claim, or where protection status has been revoked. (For present purposes I will concentrate on human rights claims.) However, the structure and operation of section 82 remain unchanged. Under the amended section 82(1) a person may appeal to the tribunal where the Secretary of State has decided to refuse a human rights claim made by him, but this does not relieve that person of the burden of establishing that the refusal was in response to a valid claim. The definitions in Part 5 do not address this question and the answer will depend on the application of the Onibiyo line of authority. Onibiyo, Cakabay, ZA (Nigeria) and VM (Jamaica) establish that there will only be a human rights claim to be determined if further submissions are considered to amount to a fresh claim. Rule 353, in turn, is directed at the manner in which a court should approach that prior question. Under the post 2014 provisions it remains the case that if there is no claim, there is no appealable decision. Thirdly, Mr Fordham makes a series of submissions relating to the intention of Parliament in enacting the 2014 amendments. In his submission, Parliament used straightforward language for the purposes of the section 82 statutory right of appeal. If, he submits, it had been the intention to maintain the structure for which the Secretary of State contends, Parliament would be expected to make that clear, but the contrary is the case. Parliament did not introduce Sir Thomas Binghams acid test into the definition of asylum claim in Part 5 of the 2002 Act. Parliament did not provide that claim was to be construed in accordance with the Immigration Rules, as it did in the case of humanitarian protection in section 82(2)(d) of the 2002 Act introduced by amendment in 2014. It did not say that claim involved an act by the Secretary of State, giving the Secretary of State a gatekeeper function as to what constitutes a claim. It did not impose an exclusion by reference to the Immigration Rules in any statutory provision which is in force. Here Mr Fordham draws attention to the fact that section 12 of the Immigration, Asylum and Nationality Act 2006 (the 2006 Act) has never been brought into force. It provides that human rights claim does not include a claim which, having regard to a former claim, falls to be disregarded for the purposes of this Part in accordance with immigration rules. Parliament did not say that the Part 5 right of appeal is subject to exceptions or limitations specified in the Immigration Rules. Rather section 82(3) states that the right of appeal under subsection (1) is subject to the exceptions and limitations specified in this Part. Mr Fordham submits that such clarification might have been expected in the light of BA (Nigeria). The difficulty with these submissions is that they fail to take account of the principle of informed interpretation and the judicial authorities on Part 5 as they stood at the date of the 2014 amendments. Parliament is normally presumed to legislate in the knowledge of and having regard to relevant judicial decisions. (See, generally, Bennion on Statutory Interpretation, 7th ed, (2017) section 24.6.) In the present context, the Court of Appeal in ZA (Nigeria) had provided an authoritative explanation of the effect of BA (Nigeria). As Sir James Eadie put it in his submissions, Parliament can therefore be assumed to have legislated in the light of a consistent line of authority which established that a purported human rights claim that did not meet the threshold of a fresh claim under rule 353 was not a claim at all. Had Parliament intended to depart from this approach, it would surely have made express provision to that effect. On the contrary, there is nothing in the amendments made in 2014 which supports the view that Parliament intended to open the door so as to enable repeated claims raising human rights issues to generate multiple appeals. (See, in this regard, Hussein per Dove J and UTJ Lane at para 42.) I should, for the sake of completeness, address two further matters arising from Mr Fordhams submissions in this regard. First, it would not be appropriate to speculate as to why section 12(3) of the 2006 Act has not been brought into force but, in any event, in seeking to ascertain the intention of Parliament the court must have regard to the legislation as enacted. (See ZA (Nigeria) per Lord Neuberger MR at para 57.) Secondly, the explanatory notes to the 2006 Act state that the amendments to the definition of human rights claim and asylum claim in section 113 of the 2002 Act were made to clarify that further submissions which follow the refusal of an asylum or human rights claim but which do not amount to a fresh claim will not carry a further right of appeal. Conclusion For these reasons I consider that the Court of Appeal was correct to conclude that a human rights claim in section 82(1)(b) of the 2002 Act as amended means an original human rights claim or a fresh human rights claim within rule 353. More generally, where a person has already had a protection claim or a human rights claim refused and there is no pending appeal, further submissions which rely on protection or human rights grounds must first be accepted by the Secretary of State as a fresh claim in accordance with rule 353 of the Immigration Rules if a decision in response to those representations is to attract a right of appeal under section 82 of the 2002 Act. For these reasons I would dismiss the appeal. Finally, I draw attention to two recent developments. First, in July 2018 Justice published a report on Immigration and Asylum Appeals by a Working Party chaired by Professor Sir Ross Cranston which highlights the pressures facing the current appeals system. Secondly, since the oral hearing on this appeal the Law Commission has published a consultation paper on the Immigration Rules which seeks to identify the underlying causes of their complexity, and to identify principles under which they can be redrafted to make them simpler and more accessible (Law Commission: Simplification of the Immigration Rules; CP 242, 21 January 2019). The Law Commissions initiative is timely and welcome. As will be apparent from this judgment, the structure of both primary and secondary legislation in this field has reached such a degree of complexity that there is an urgent need to make the law and procedure clear and comprehensible.

The appellant is a Jamaican national who arrived in the United Kingdom on 9 October 1998 when he was seven years old. He has several criminal convictions, including two robberies that triggered deportation proceedings. On 17 July 2013, a deportation order was issued. He appealed to the First tier Tribunal (Immigration and Asylum Chamber) (FTT) against his proposed deportation, based on a claimed right to respect for his private life in the UK. It was accepted at the time that there was no family life in play. His appeal was dismissed, and he was refused permission to appeal to the Upper Tribunal (Immigration and Asylum Chamber) (UT). He exhausted his rights of appeal on 1 May 2015. On 13 May 2015, the appellants previous solicitors made further submissions to the Secretary of State, focusing on the fact that his partner at the time was pregnant. The submissions did not explicitly request that the deportation order be revoked, nor did they refer to human rights. The Secretary of State treated the representations as an application to revoke the deportation order on the basis that it would breach Article 8 of the ECHR. In a letter dated 23 June 2015, the Secretary of State concluded that deportation would not breach Article 8, refused to revoke the deportation order and decided that the submissions did not amount to a fresh human rights claim under paragraph 353 of the Immigration Rules (rule 353). The appellants son was born on 26 July 2015. The appellant made further submissions to the Secretary of State on 28 July 2015 regarding the birth of his son and providing documentation from the hospital. In a letter dated 31 July 2015, the Secretary of State again concluded that deportation would not breach Article 8 and that the further submissions did not amount to a fresh claim. The appellant appealed against the decision of 31 July 2015 but the FTT declined jurisdiction on the basis that there was no right of appeal against the decision. The UT dismissed his application for judicial review of the Secretary of States decision that the further representations were not a fresh claim and the FTTs decision that he had no right of appeal. On 4 May 2017, the Court of Appeal dismissed his appeal. The Supreme Court dismisses the appeal. Lord Lloyd Jones gives the sole judgment with which the other Justices agree. The question in this appeal is: where a person has already had a human rights claim refused and there is no pending appeal, do further submissions that rely on human rights grounds have to be accepted by the Secretary of State as a fresh claim in accordance with rule 353 if a decision in response to those representations is to attract a right of appeal under section 82 of the Nationality, Immigration and Asylum Act 2002 (the 2002 Act) [1]? The appellant raises two principal arguments for why they do not. 1. BA (Nigeria) The appellant submits that the line of authority beginning with R v Secretary of State for the Home Department Ex p Onibiyo [1996] QB 768, which established that it was for the Secretary of State to decide whether further submissions constituted a fresh claim giving rise to a right of appeal, did not survive the Supreme Courts decision in BA (Nigeria) v Secretary of State for the Home Department [2009] UKSC 7 [26]. The Court disagrees as BA (Nigeria) was limited to cases where the further submissions have been rejected and there was an appealable decision [50]. Its reasons are as follows: (1) BA (Nigeria) established that, where the Secretary of State receives further submissions on which he makes an immigration decision within section 82 of the 2002 Act, in the absence of certification there will be an in country right of appeal. Onibiyo and rule 353, by contrast, address a prior issue of whether there is a claim requiring a decision at all [46]. (2) The 2002 Act, particularly the powers of certification under sections 94 and 96, does not render Onibiyo and rule 353 redundant. The effect of rule 353 is that no right of appeal ever arises, rather than only to limit to an out of country appeal, and it operates at a prior stage to section 94. Section 96(1) addresses a different aspect of renewed claims, as it applies where a person relies on a matter that could have been raised in an earlier appeal but has no satisfactory reason for not doing so [47]. (3) Parliament did not intend the 2002 Act to provide a comprehensive code for dealing with repeat claims or for rule 353 no longer to be effective. There was no attempt to repeal rule 353s predecessor and Parliament has approved subsequent amendments to the Immigration Rules that did not delete rule 353. Moreover, following the amendment of the 2002 Act in 2014, rule 353 was amended to ensure it applies to human rights claims and protection claims, which suggests it was still effective [48]. (4) The appellants broad reading of BA (Nigeria) is inconsistent with ZT (Kosovo) v Secretary of State for the Home Department [2009] UKHL 6, in which the House of Lords held that the Secretary of State had erred in applying section 94(2) of the 2002 Act rather than rule 353 in considering further submissions. BA (Nigeria) merely decided that rule 353 has no part to play once there is an appealable immigration decision. It contains no express statement that it intends to overrule or depart from ZT (Kosovo), and it is extremely improbable that that was the intention [49]. 2. 2014 Amendments to the 2002 Act The appellant submits that the amendments to the 2002 Act effected by the Immigration Act 2014 fundamentally changed the operation of the statutory scheme, with the result that rule 353 no longer applies [58]. The Court rejects these submissions for the following reasons: (1) Referring to rule 353 to determine if subsequent submissions are a human rights claim does not result in the same words bearing different meanings. In BA (Nigeria) there was in each case a human rights claim, but there was a right of appeal against an immigration decision, so the interpretation of human rights claim did not need to refer to rule 353. In this case, the issue is the prior question of whether there is a claim at all [59]. (2) The 2014 amendments limit appeals to where there has been a refusal of a protection claim or a human rights claim, or the revocation of protection status. The structure and operation of section 82 remains unchanged. The amended section 82 does not relieve a person of the burden of establishing that the Secretary of State has refused a valid human rights claim [60]. (3) Parliament is presumed to legislate in the knowledge of and having regard to relevant judicial decisions. In the present context, the Court of Appeal in ZA (Nigeria) v Secretary of State for the Home Department [2010] EWCA Civ 926 had provided an authoritative explanation of the effect of BA (Nigeria). Parliament is therefore assumed to have legislated in light of a consistent line of authority establishing that a purported human rights claim short of the threshold of a fresh claim under rule 353 was not a claim at all. There is nothing in the 2014 amendments to suggest Parliament intended to enable repeated claims raising human rights issues to generate multiple appeals [62]. Therefore, human rights claim in section 82 of the amended 2002 Act means an original human rights claim or a fresh human rights claim within rule 353. As a result, the Secretary of States response to the appellants further submissions did not attract a right of appeal [64].

8k-16k

On 29 November 2010 the Immigration Rules were amended so as to require a foreign spouse or partner of a British citizen or a person settled in this country to pass a test of competence in the English language before coming to live here (the Rule). Clearly, for a variety of reasons, some people would find this much harder to do than others. These included many people from India, Pakistan, and Bangladesh, three of the four countries from which the greatest numbers of foreign spouses and partners are drawn (the fourth is the USA). Hence the proposed Rule caused particular concern among those communities in this country where marriage to partners from those countries is most common. They saw it as a discriminatory measure which aimed to limit spousal migration from those and similar countries. These proceedings were launched in November 2010, before the Rule came into force, in order to challenge the validity of the rule itself. The appellants argue that the Rule is an unjustifiable interference with the right to respect for private and family life, protected by article 8 of the European Convention on Human Rights (ECHR); or that it is unjustifiably discriminatory in securing the enjoyment of that right, contrary to article 14 of the ECHR; or that it is irrational and therefore unlawful on common law principles. They have set themselves a difficult task. It may well be possible to show that the application of the Rule in an individual case is incompatible with the Convention rights of a British partner, as happened in the case of a different marriage rule in R (Aguilar Quila) v Secretary of State for the Home Department (AIRE Centre intervening) [2011] UKSC 45, [2012] 1 AC 621. It is much harder to show that the Rule itself is inevitably unlawful, whether under the Human Rights Act 1998 or at common law, although this was possible in the case of yet another marriage rule, in R (Baiai) v Secretary of State for the Home Department (Joint Council for the Welfare of Immigrants intervening) (Nos 1 and 2) [2008] UKHL 53, [2009] AC 287. It is not surprising, therefore, that Beatson J concluded that the fact that it might be possible to argue that the operation of the Rule was a disproportionate infringement of an individuals article 8 rights did not render the Rule itself disproportionate: [2011] EWHC 3370 (Admin), [2012] 2 All ER 653 (sub nom R (Chapti) v Secretary of State for the Home Department (Liberty intervening)), para 115. By a majority, the Court of Appeal reached the same conclusion: [2013] EWCA Civ 322, [2014] 1 WLR 208. A further difficulty is that things have not stood still since the proceedings were launched in November 2010, since Beatson J reached his decision in December 2011, and since the Court of Appeal reached their decision in April 2013. The Rule itself has stayed much the same, but it has been restated in a new Appendix FM to the Immigration Rules which seeks to deal compendiously with family relationships. More importantly, the guidance to those operating it on the ground has developed as time has gone on. And perhaps most important of all, the facts relating to the accessibility of the required tests were difficult to ascertain and are also subject to change. The discussion of the evidence and arguments, on the one hand by Dr Helena Wray and her colleagues for the appellants, and on the other hand by Mrs Helen Sayeed for the Secretary of State, has to be applied to the situation as it now is rather than as it was in 2011. The development of the Rule The Rule may be set against a background of immigration controls which have traditionally differentiated between so called primary migration, of breadwinners coming here for economic reasons, and secondary migration, of spouses, partners and other family members coming to join the breadwinners here. All are expected not to place an undue burden upon the state and its resources. Controls relating to the former look to the work or business from which the migrant intends to support himself; controls relating to the latter look to whether the family has the resources to support itself. A second background feature is that control over the entry of nationals from the European Economic Area and their families is governed by European Union law. The Rule is not concerned with them, even though English will not be the first language for the great majority. Spouses, partners and intending partners are first given limited leave to enter for a probationary period. Until 2012, this was two years, but it has now been raised to at least the five years which is required of other migrants. At the end of this period, they can apply for indefinite leave to remain (ILR). In 2005, applicants for British citizenship were for the first time required to demonstrate sufficient knowledge of the English language and about life in the United Kingdom (KOLL). In 2007, this post entry requirement was extended to applicants for ILR, including spouses and partners. This can be satisfied by taking the Life in the UK test (LUK), which requires a considerable level of competence in the English language. An alternative for non native English speakers was to take a course in English for Speakers of Other Languages (ESOL), taught with specified citizenship materials. Since October 2013, however, all applicants for ILR have been required to meet the same specific English language requirement and pass the LUK test. Such data as we have suggest that the number of spouses and partners failing the settlement test was never high and declined sharply after the first year of its introduction (Equality Impact Assessment, 2010). This is based on the numbers who had to apply for further limited leave to remain because they had failed the test, which are very small when compared with the numbers granted ILR after entering through the family route. The data indicated that a higher proportion of spouses or partners took the ESOL rather than the LUK route to satisfying the requirement. The Secretary of State suggests that this could mean that even after two years in the UK they had not acquired sufficient English to enable them to pass the LUK test. However, migrants coming from non English speaking countries are advised to take an ESOL course before attempting a settlement test. So this figure could simply reflect the fact that a higher proportion of spouses and partners come from non English speaking countries. Having taken an ESOL course with the required citizenship materials, there would be no point in their taking the LUK test instead. In 2007, the Government first floated the idea of requiring a pre entry test for foreign spouses and partners, in Securing the UK Border: Our vision and strategy for the future (March 2007). In the chapter on Wider, tougher checks abroad, under the heading Targeting areas of abuse, this made suggestions about Marriage to partners from overseas protection for the vulnerable and the skills to integrate (para 3.22). Alongside suggestions aimed at deterring or preventing forced marriages was a proposal to examine the case for introducing a new requirement to pass some form of English test before arrival. This was soon followed by a consultation paper, Marriage Visas: Pre Entry English Requirement for Spouses (December, 2007), published alongside a separate consultation paper, Marriage to Partners from Overseas, which dealt with proposals to combat forced marriages (the subject of this courts decision in Aguilar Quila). The key objectives of introducing a pre entry English requirement for spouses were said to be (para 1.11): To assist the spouses integration into British society at an early stage; To improve employment chances for those who have access to the labour market; To raise awareness of the importance of language and to prepare for the tests they will need to pass for settlement. In July 2008, the Government published Marriage Visas: The Way Forward, which dealt with the mainly negative response to both consultation papers. Opponents cited the difficulties of accessing English language lessons overseas, the interference with the right to respect for family life and individual human rights, and the view that English was best learned in the United Kingdom (paras 2.14 2.16). Nevertheless, the Government had decided upon the medium term goal of introducing an English test for spouses before they arrived here. The three stated objectives remained the same (paras 1.4, 2.2); although respondents who favoured the proposal also suggested that it would reduce the cost of translation services in the UK and bring potential benefits to spouses of improved employment opportunities, freeing them from being tied to home and family (para 2.17). But the Government decided that it would move towards this goal over a period of time (para 2.3): This is simply because there is not currently sufficient access to English language classes overseas, especially in rural areas, and to introduce the requirement in a dogmatic way immediately would simply keep British citizens apart from their loved ones, breaking up families. In the meantime, as part of the visa application process, foreign spouses would be required to enter into an agreement to learn English, showing before arrival how they planned to so do and after arrival how they were doing so. A year later, however, it was decided to implement the new policy in the summer of 2011. An Equality Impact Assessment, published in July 2009, explained that the cross Whitehall group working on the policy felt that announcing an implementation date would generate a supply of sufficient English tuition to meet demand, but it would take between 18 to 24 months to develop sufficient capacity (p 12). An Impact Assessment (of the proposed pre entry language requirements for economic as well as spousal migrants), also published in July 2009, explained that it had been decided that spouses would only have to demonstrate that they could speak (not necessarily read or write) English to level A1 of the Common European Framework of Reference for Languages (the CEFR). This was considered to require 40 to 50 hours tuition for most learners. Level A1 requires that the user: Can understand and use familiar everyday expressions and very basic phrases aimed at the satisfaction of needs of a concrete type. Can introduce him/herself and others and can ask and answer questions about personal details such as where he/she lives, people he/she knows and things he/she has. Can interact in a simply way provided the other person talks slowly and clearly and is prepared to help. After the coalition Government took office in May 2010, however, the timetable was advanced. On 9 June, the Home Secretary announced that the pre entry test requirement would come into effect in the autumn: this will help promote the economic well being of the UK, for example by encouraging integration and protecting public services. It will also assist in removing cultural barriers, broaden opportunities for migrants and help to ensure that they are equipped to play a full part in British life. On 26 July, the Minister of State for Immigration announced that the requirement would come into effect on 29 November. He confirmed that spouses and partners would have to show English language ability in speaking and listening at level A1 of the CEFR, by passing an acceptable test with an approved test provider. The Rule applies to non European spouses, civil partners, unmarried opposite and same sex partners, fianc(e)s and proposed civil partners (collectively spouses and partners) wishing to live here with a British citizen or a non European national settled in the UK. This was originally done by amendment to paragraphs 281, 284, 290, 293, 295A and 295D of the Immigration Rules: Statement of Changes to Immigration Rules, 1 October 2010 (Cm 7944). In 2011 the Rule was extended to spouses and partners of refugees and people granted humanitarian protection in the UK, covered by paras 319L and 319O: 16 March 2011 (HC 863). However, applications for leave to enter or remain made on or after 9 July 2012 are now governed by Appendix FM to the Immigration Rules. Since 1 December 2013, the English language requirement has also been imposed upon specified partners of members of the Armed Forces, under the Appendix Armed Forces. It is therefore convenient to recite the Rule as contained in Appendix FM rather than the earlier version considered in the courts below. Appendix FM provides that applicants for entry clearance or limited leave to remain as a partner must satisfy the English language requirement as follows (paras E ECP 4.1 and E LTRP 4.1): The applicant must provide specified evidence that they (a) are a national of a majority English speaking country listed in paragraph GEN 1.6; (b) have passed an English language test in speaking and listening at a minimum of level A1 of the Common European Framework of Reference for Languages with a provider approved by the Secretary of State; (c) have an academic qualification recognised by UK NARIC [the National Recognition Information Centre] to be equivalent to the standard of a Bachelors or Masters degree or PhD in the UK, which was taught in English; or (d) are exempt from the English language requirement under para E ECP 4.2. The majority English speaking countries listed in paragraph GEN 1.6 are Antigua and Barbuda; Australia; the Bahamas; Barbados; Belize; Canada; Dominica; Grenada; Guyana; Jamaica; New Zealand; St Kitts and Nevis; St Lucia; St Vincent and the Grenadines; Trinidad and Tobago; and the United States of America. The exemptions in paras E ECP 4.2 and E LTRP 4.2 apply if at the date of application (a) the applicant is aged 65 or over; (b) the applicant has a disability (physical or mental condition) which prevents the applicant from meeting the requirement; or (c) there are exceptional circumstances which prevent the applicant from being able to meet the requirement prior [to entry to the UK]. The words in square brackets in (c) do not apply, for obvious reasons, to partners who are applying for limited leave to remain here as a partner. These requirements are in essence the same as those imposed by the amendment to para 281 (for spouses) and the other relevant paragraphs of the Rules, save that these made an exception where there are exceptional compassionate circumstances that would prevent the applicant from meeting the requirement (para 281(1)(a)(ii)(c)). Compassionate has now been dropped. The courts below did not consider the guidance given to entry clearance staff as to how the Rule should be operated. The internal guidance on the English language requirement (SET 17 updated 15 February 2011) stated as follows (para SET 17.9): Discretion should be exercised only in cases where there are the most exceptional, compelling and compassionate circumstances specifically relating to the ability of the applicant to meet the language requirement, circumstances should be assessed on a case by case basis. The expectation is that use of the exceptional compassionate circumstances exemption will be rare. Financial reasons will not be acceptable. (emphasis supplied) However, at that stage, if the applicant partner was a long term resident of a country with no test centre, he or she was automatically exempted under this criterion. This exemption was withdrawn as from 24 July 2014. The current guidance on the consideration of exceptional circumstances, in the Immigration Directorate Instruction, English Language Requirement Family Members under Part 8, Appendix FM and Appendix Armed Forces, April 2015, para 7.1, contains the following passages: Each application for an exemption on the basis of exceptional circumstances will be considered on its merits on a case by case basis. Evidence of the nature and impact of the exceptional circumstances must be clearly provided, eg of previous efforts to access learning materials or to travel overseas to take an approved test and the obstacles to doing so. This must include evidence provided by an independent source (eg an appropriately qualified medical practitioner) or capable of being verified by the decision maker. Examples of situations in which, subject to the necessary supporting evidence, the decision maker might conclude that there were exceptional circumstances, might include where the applicant Is a long term resident of a country in international or internal armed conflict, or where there is or has been a humanitarian disaster, including in light of the infrastructure affected. Has been hospitalised for several months immediately prior to the date of application. Is the full time carer of a disabled child also applying to come to the UK. Is a long term resident of a country with no approved A1 test provision and it is not practicable or reasonable for the applicant to travel to another country to take a test Lack of or limited literacy or education will not be accepted as exceptional circumstances. (emphasis supplied) Further guidance is given on countries with no approved A1 test provision in para 7.2: From 24 July 2014, applicants who are resident in a country with no approved A1 English language test are expected to travel to another country to take such a test. Only where they can demonstrate in their visa application that it is not practicable or reasonable for them to do so will they be exempt from the requirement prior to entry to the UK. Reasons why it is not practicable or reasonable for an applicant to take an approved A1 test in another country will normally require more than inconvenience or reluctance to travel overseas. Subject to supporting evidence, such reasons might exist where for example: Exit visa requirements or restrictions make it very difficult for the applicant to travel overseas. The applicant faces insuperable problems in meeting immigration requirements to visit a country with an approved test centre. The applicant faces unreasonable additional travel or accommodation costs to visit a country with an approved test centre. Some applicants as a partner . already incur travel and accommodation costs to attend an approved test centre in their own country or to give their biometrics at a Visa Application Centre. In addition, all applicants for a settlement visa as a partner are required to meet a financial requirement and it is reasonable to expect that they (or their sponsor ) will generally be able to afford incurred in making reasonable costs application. Other exceptional circumstances prevent the applicant taking an approved A1 test in another country. For completeness, it is necessary also to note the circumstances in which entry clearance may be given even though the application does not meet the requirements of the Immigration Rules. The Immigration Directorate Instruction Family Migration, Appendix FM section 1.0a, Family Life (as a Partner or Parent): 5 year Routes (August 2015) deals with Exceptional Circumstances or Compassionate Factors in section 14. Entry clearance officers must in every case go on to consider whether there may be either exceptional circumstances which would make the refusal of entry clearance a breach of article 8 because [it] would result in unjustifiably harsh consequences for the applicant or their family or compassionate factors that is compelling compassionate reasons which might mean that refusal would result in unjustifiably harsh consequences even if it did not constitute a breach of article 8. Entry clearance officers cannot themselves grant entry clearance outside the Rules, but if they consider the case might meet the very high threshold they must refer it to the Referred Casework Unit in London. The threshold is very high because the Home Office considers that the appropriate balance between individual rights and the public interest has been clearly spelled out in the Rules (now underpinned by section 19 of the Immigration Act 2014). Under the heading How to consider exceptional circumstances, the Instructions state: Exceptional does not mean unusual or unique. Whilst all cases are to some extent unique, those unique factors do not generally render them exceptional. For example, a case is not exceptional just because the criteria set out in the Immigration Rules have been missed by a small margin. Instead exceptional means circumstances in which refusal would result in unjustifiably harsh consequences for the individual or their family such that refusal would not be proportionate under article 8. The fact that refusal may, for example, result in the continued separation of family members does not of itself constitute exceptional circumstances where the family have chosen to separate themselves. Cases that raise exceptional circumstances to warrant a grant of entry clearance outside the Rules are likely to be rare. In determining whether there are exceptional circumstances, the decision maker must consider all relevant factors raised by the applicant and weigh them against the public interest under article 8. Examples of relevant factors include: The best interests of any child in the UK affected by the decision. The nature of the family relationships involved, such as the length of the applicants marriage and how frequently they have contact with their children if they do not live with them . The likely impact on the applicant, their partner and/or child if the application is refused. Whether there are any factors which might increase the public interest in refusal, for example, the fact that they do not speak English (emphasis supplied) Cumulative factors should be considered. Cumulative factors weighing in favour of the applicant should be balanced against cumulative factors weighing in the public interest in deciding whether refusal would be unjustifiably harsh for the applicant or their family. The tests The research conducted on behalf of the appellants in 2011 showed that it was then by no means easy to find out which tests were offered and in which places. One problem was that tests at the very basic A1 level, and limited to speaking and listening, were not always available, whereas there might be tests at a higher level or including reading and writing skills. All the websites giving the relevant information were in English. These may, of course, have been teething troubles, given that the proceedings were launched before the Rule had come into force. The most recent information from the Secretary of State was that, as from 6 April 2015, the approved A1 test for partners overseas will be the International English Language Testing System (IELTS) Skills for Life test offered by the IELTS consortium (the University of Cambridge English Language Assessment, the British Council and IDP Education Ltd). The British Council website provides some useful information. It explains that the IELTS Life Skills test is a new test for people who need to prove their speaking and listening skills at A1 or B1 level on the CEFR. A secure English language test (SELT) can be taken at around 100 test centres around the world. There is a link to the United Kingdom Visa Information website which gives their locations. The test involves a face to face conversation lasting 16 to 18 minutes with the examiner and another candidate. It cannot be taken on line or over the telephone. There are now listening test samples on the IELTS website. These cases This case has proceeded on the basis of assumed facts (the Secretary of State not being in a position to agree them all) in order to test the lawfulness or otherwise of the pre entry language requirement, as set out in the Rules and Guidance quoted above. There are two appellants, both women who are British citizens married to foreigners. Their husbands have not applied for entry clearance because they believe themselves unable to satisfy the pre entry language requirement and accordingly the not inconsiderable fee for making an application would be wasted. Saiqa Bibi is a British Citizen who was born in Coventry and lives with her family in the West Midlands. In April 2009, she married Mohammed Jehangir, a citizen of Pakistan. They have one child, a son born in 2010, who lives with his mother. The couple keep in touch with one another by telephone and occasional visits to Pakistan. They would like to live here together as a family. Mr Jehangir was educated to matriculation level in Pakistan but in Urdu. He neither speaks nor writes any English. There is no English tuition of the level required available locally to where he lives and to obtain it he would have to make a round trip of some four hours, to Mirpur or Islamabad. This is not practicable on a daily basis, so he would have to relocate for several months to Rawalpindi, which is not affordable. Mrs Saffana Ali is also a British citizen. She spent approximately two and a half years, from 2006 to 2008, visiting the Yemen, where she met and formed a relationship with her husband Mr Ali. When she returned to this country in 2008 they kept in touch over the telephone and decided to get married. She returned to the Yemen in May 2010 and they married there in July 2010. Mr Ali does not speak any English. He has not had any formal education and is illiterate and unfamiliar with the Roman alphabet. There is no test centre in the Yemen. Because her husband is unable to come and live with her here, Mrs Ali has remained with him in the Yemen, but she would like them to be able to live together here, where she has lived since a child and has family and friends. Article 8 Everyone has the right to respect for his private and family life, his home and his correspondence: article 8(1), ECHR. In Abdulaziz, Cabales and Balkandali v United Kingdom (1985) 7 EHRR 471, the European Court of Human Rights observed that Whatever else the word family may mean, it must at any rate include the relationship that arises from a lawful and genuine marriage even if a family life has not yet been fully established. Not only that, family life, in the case of a married couple, normally comprises cohabitation. The latter proposition is reinforced by the existence of article 12, for it is scarcely conceivable that the right to found a family should not encompass the right to live together (para 62). Hence, as this court held in Aguilar Quila, married couples have a right to live together. However, in Abdulaziz, the European Court also held that article 8 did not impose a general obligation on the part of a Contracting State to respect the choice by married couples of the country of their matrimonial residence and to accept the non national spouses for settlement in that country (para 68). That statement was repeated by the Grand Chamber in the most recent case of Jeunesse v The Netherlands (2015) 60 EHRR 789 (para 107), which draws together the applicable principles. The jurisprudence of the court draws a distinction between cases where migrants who have been lawfully settled in a country for a long time face deportation or expulsion and cases where an alien is seeking admission to a host country. The former entails the possible breach of the negative obligation in article 8(2): There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society . The latter entails the possible failure of the state to comply with a positive obligation to permit the enjoyment of family life in that country. It concerns not only family life but also immigration (paras 104, 105). Nevertheless, although the criteria developed in the first context cannot be transposed automatically into the second, the applicable principles are, nonetheless, similar. In both contexts regard must be had to the fair balance that has to be struck between the competing interests of the individual and of the community as a whole; and in both contexts the state enjoys a certain margin of appreciation (para 106). In cases involving family life and immigration, factors to be taken into account are the extent to which family life would effectively be ruptured, the extent of the ties in the Contracting State, whether there are insurmountable obstacles in the way of the family living in the country of origin of the alien concerned and whether there are factors of immigration control (for example, a history of breaches of immigration law) or considerations of public order weighing in favour of exclusion (para 107). If family life was created when the people involved were aware that the persistence of family life within the host state would be precarious, it is likely only to be in exceptional circumstances that the removal of the non national family member will constitute a violation of article 8 (para 108). However, where children are involved, their best interests must be taken into account: Whilst alone they cannot be decisive, such interests certainly must be afforded significant weight (para 109). In Jeunesse, the Grand Chamber found that, although the applicant had married and had three children while her immigration status in the Netherlands was precarious, there were exceptional circumstances such that a fair balance had not been struck between the competing interests involved: the husband and three children were all citizens of the Netherlands with the right to enjoy family life there; the applicant had lost her Dutch nationality when Suriname became independent and not through her own choice; she had been living in the Netherlands for 16 years and had no criminal record; although there were no insurmountable obstacles to the whole family settling in Suriname, they would experience a degree of hardship if forced to do so; and the Dutch authorities had paid insufficient attention to the problems the children would face in either having their whole lives disrupted by a move to Suriname or being separated from their primary carer. In the circumstances, it was questionable whether general immigration policy considerations of themselves can be regarded as sufficient justification for refusing the applicant residence in the Netherlands (para 121). Although Strasbourg analyses these cases in terms of a fair balance, in this country we have, at least since the decisions in Huang v Secretary of State for the Home Department [2007] UKHL 11, [2007] 2 AC 167 and Aguilar Quila, spelled out the principles in conventional proportionality terms. As Lord Wilson put it in Aguilar Quila, para 45, following Lord Bingham in Huang, para 19, four questions generally arise: (a) is the legislative objective sufficiently important to justify limiting a fundamental right?; (b) are the measures which have been designed to meet it rationally connected to it?; (c) are they no more than are necessary to accomplish it?; and (d) do they strike a fair balance between the rights of the individual and the interests of the community? (a) Legitimate aim It is important to appreciate that, although the context of this case is immigration, the Government has never suggested that the aim of the Rule is to limit immigration by spouses and other partners of people settled here. It does not operate, and is not intended to operate, as a cap on the number of partners admitted. It has long been taken for granted that the wives of British citizens have the right to join their husbands here traditionally, wives were expected to assume their husbands nationality and domicile on marriage, and indeed there may still be countries in the world where women lose their nationality of origin on marrying a foreigner. British immigration law originally reflected this right, but was obliged, following the Abdulaziz case, to afford it also to the husbands of British citizen wives. The same right was later extended to unmarried couples who had been living together in a relationship akin to marriage for some time and then to civil partners and same sex couples living together in a relationship akin to civil partnership. All of this reflects the importance attached to family relationships in modern international human rights law. The Universal Declaration of Human Rights of 1948 proclaimed that The family is the natural and fundamental group unit of society and is entitled to protection by society and the state (article 16.3). The International Covenant on Civil and Political Rights of 1966 translated this into a binding obligation in exactly the same words (article 23). Both of these documents proclaimed that the rights they provided must be respected without discrimination on grounds such as race and sex (article 2 in each case). The Human Rights Committee, in General Comment No 19 (1990), explained that different States might have different concepts of the family, but whatever their concept, it must be afforded the protection required. The International Covenant on Economic and Social Rights goes even further, in providing that The widest possible protection and assistance should be accorded to the family, which is the natural and fundamental group unit of society (article 10.1). Appendix FM to the Immigration Rules does impose some limits on the right of partners to come here. For example, they must fulfil certain suitability requirements, mainly relating to the lack of criminal convictions; the couple must both be at least 18 and their relationship must be genuine and subsisting; and they must be able to support and house themselves from their own resources. In general, these are aimed at the protection of society from harmful behaviour, the prevention of abuse, and the protection of public funds. It is accepted that partners who come here will make use of those public services, such as education and the National Health Service, which are available to all. So what, then, are the aims of the English language requirement? As originally stated, they were three: (i) to assist the partners integration into British society at an early stage; (ii) to improve their employment chances, given that they have access to the labour market as soon as they arrive; (iii) to raise awareness of the importance of language and to prepare for the tests they will need to pass for settlement. Following the consultation, three further aims emerged: (iv) to save translation costs; (v) to benefit any children the couple might have; and (vi) to reduce the vulnerability of newly arrived spouses, especially women. In article 8 terms, these probably fall under the rubric of the interests of the economic well being of the country or, just conceivably, the protection of the rights and freedoms of others. Some may think, however, that they are not as important as the prevention of disorder or crime, which is the main aim of the suitability requirements, or the protection of the public purse, which is the main aim of the financial requirements. The appellants have filed extensive evidence in support of their arguments in response to the rather less extensive evidence filed on behalf of the government. Some of that evidence and argument is summarised and commented upon below. As to (ii), it is true that partners are permitted to join the labour market as soon as they arrive, and if they choose to do so, basic English language skills will no doubt help them to get a job outside their own community. It may well be that most husbands coming to join their wives here do intend to join the labour market, but the same may not be true of most wives. There is evidence that language skills are associated with higher earnings (but this may not be the only reason for persistent wage differentials between different cultural groups). But, valid though the aim is for those who do intend immediately to join the labour market, partners are not required or even expected to do so that is not the reason why they are admitted. As to (iii), the basic pre entry level might be some help in preparing for the settlement test, but in the opinion of Dr Geoffrey Jordan, the language expert who contributed to Dr Wrays report for the appellants, the pre entry test is of almost no value in getting the learner off to a flying start. It will pale into insignificance compared with the opportunities of learning the language over the (now) five years that the partner will have to be here before taking the settlement test. The need to pass the test before being allowed to stay here indefinitely should be sufficient incentive even for those who, perhaps for cultural reasons, might otherwise not be inclined or encouraged to do so. Of course, this would not be an incentive for those who are prepared to remain here without ILR and rely on their article 8 rights to resist removal. As to (iv), this was not among the original aims, and no one has been able to put any sort of financial value upon it. There are, as Mrs Helen Sayeed, for the Government, says, plenty of data suggesting there is significant reliance on translation support services (WS No 2, para 10). However, given the substantial burden of translation caused by the people who are already here, no one has shown what, if any, extra burden is occasioned by allowing partners to come here without any pre entry language requirement or how much help that requirement is in reducing the need for translation when communication really matters. As to (v), there is some evidence that children whose first language is not English do less well at school, but a pre entry language requirement will not ensure that English is spoken at home. Children already here have ample opportunities for learning the language outside the home; children coming here with the foreign partner (which, as Mrs Sayeed says, is less likely because many of those seeking marriage visas are newly married) will have similar opportunities; children are usually much quicker at picking up another language than are adults and are often a valuable source of learning for their parents, rather than the other way around. More important, for children such as Saiqa Bibis son, the choice is not between having a parent here with or without basic English language skills but between having a parent here and not having a parent here at all; separation is likely to be far more damaging to the child than living with a parent who has yet to acquire any English. As to (vi), the Government does not assert that this is a key rationale, although if it has any impact it would likely be a positive one given the migrants better position to seek help/advice (Helen Sayeed, WS 2, para 16). Pragna Patel, of Southall Black Sisters, the best known organisation working with migrant women suffering domestic abuse, does not see a pre entry test as being of significant benefit to them: language is the least of the problems they face in obtaining access to advice and services. Nevertheless, it is likely that even basic language skills will be of some benefit to vulnerable women who come here as spouses. All the stated aims are, in reality, aspects of the first, which is to assist the partners integration into British society at an early stage. This is undoubtedly an important aim. In 2006, the Secretary of State for Communities and Local Government established an independent Commission on Integration and Cohesion. Their Report, Our Shared Future, was published in 2007. According to the Commission, cohesion is principally the process that must happen in all communities to ensure different groups of people get on well together; while integration is principally the process that ensures new residents and existing residents adapt to one another (para 3.2). Research done for the Commission by Ipsos MORI, Public Attitudes towards Cohesion and Integration, 15 June 2007, found that interaction with people from different backgrounds was seen as fundamental to fostering a better sense of community and cohesion. Inability to speak English was seen as the biggest barrier to being English. The Commission saw a shared language as being fundamental to integration and cohesion for settled communities, new communities, and future generations of migrants (para 5.35). Improving the availability of ESOL classes and reducing the amount of automatic translation of official information into other languages were among their key recommendations. It is not difficult to see the benefits to integration of even a basic level of English language skills. It must be beneficial for a newly arrived partner to be able to go into a shop and buy groceries and other necessities, to say hello to the neighbours, to navigate public transport, to inter act at a simple level with bureaucrats and health care professionals. Integration is a two way process. It must be beneficial for others to see that the people living in our midst and intending to stay here are able and willing to join in and play a part in everyday social interactions, rather than keeping themselves separate and apart. All of this is, to use the term used by Maurice Kay LJ, benign. The question for us, however, is how important a pre entry test is in achieving these benign aims. What value does it add to the post entry settlement test? There has been some suggestion that foreign spouses were not achieving the same standard as other applicants for ILR. This was because more of them were choosing the ESOL route than the LUK route to demonstrate the required knowledge of language and life in the UK. But, as already explained, taking an ESOL course is recommended for those whose first language is not English. Given that most foreign partners come from countries where the first language is not English, it is scarcely surprising that they should take such a course and, having taken it, choose this route to qualify. Now that all candidates are to be expected to take the same tests, no doubt most will still take an ESOL course in order to gain the required skills. More importantly, the expert evidence filed on behalf of the appellants suggests that the very basic level of language required by the pre entry tests will not be of much help to them. The best and quickest way to learn the language is by practice and immersion while here rather than in a foreign classroom. As the appellants language expert, Dr Geoffrey Jordan, put it Learning a second language is not like learning Geography or Law: it is more akin to learning to swim, drive or use a computer. To be a competent user of English as a second language requires that declarative knowledge (I know about this) becomes procedural knowledge (I can do this), and it is thus, essentially, a question of practice. It is also worth bearing in mind, as Dr Katherine Charsley explained in her evidence for the appellants, that there are several dimensions to integration economic, social, cultural and civic and that there are many processes of integration as well as language. It is also a two way process. She suggests that migrant side attempts to integrate may mean little or even have negative effects if the response of the host population is not inclusive. Further, she cites the Commissions suggestion that perceptions of inequality may undermine integration. Measures that are perceived as discriminatory and exclusionary are likely to be counter productive to integration by producing ill feeling, and undermining equality of opportunity and participation. The evidence therefore leads to the conclusion that the Rule does have a legitimate aim (or a series of aims all linked to the promotion of integration and with it the larger aim of community cohesion) and that the aim is sufficiently important to justify interfering with the fundamental right to respect for the family life of British citizens or persons settled here who wish to be joined here by partners from overseas. Nevertheless, the aim is not as important as the other aims to which the pre entry qualifications of foreign partners are addressed and the aim of a pre entry language requirement is not as important as the aim of ensuring that all migrants learn English once they are here. (b) A rational connection In this case it is not difficult to see a rational connection between the measure and the aim it seeks to achieve. I would not base this, as Beatson J did, on the suggestion that spouses and other partners are a key target group whose language skills after entry are not as good as those of other migrants. That is debateable. But a pre entry language requirement is also imposed upon economic migrants. While it may be doubted that requiring a very basic level of spoken English before entry makes a great contribution to the overall aim of promoting integration, it cannot be said that it makes no contribution towards it at all. (c) A less intrusive means Sir David Keene dissented in the Court of Appeal. He concluded that the pre entry test had not been shown by any substantial empirical evidence to be no more than is necessary to achieve the legitimate aim (para 59). The post entry test was achieving its object. The numbers of spousal migrants who had to seek further limited leave to remain because they had failed the test fell from 3,245 in 2007 (when it was first introduced), to 995 in 2008, to 470 in 2009. This was in any event a tiny proportion of the spousal migrants who achieved settlement in 2009. Of course, it is possible that some spousal migrants, having been granted entry clearance or leave to remain, never apply for ILR and so manage to avoid having to show that they know anything about the life and language of the UK. It is not currently possible to know how many people with expired visas have left the country and accordingly how many have not. It is known that there is a large number of over stayers but it seems inherently unlikely that many of these are spousal migrants. In the opinion of Dr Helena Wray, they have a regular path to settlement; they live amongst the settled community, often working or bringing up a family, so that it would be hard for them to go to ground; and they have the possibility of further limited leave to remain while taking or retaking the test. Thus the aim of integration through shared language skills is principally achieved through the post entry ILR language requirement, which involves virtually no interference with the right to respect for family life. Nevertheless, the longer a spousal migrant is here without acquiring the required language skills, the harder it will be to oblige them to leave. There is therefore some benefit to integration and cohesion in requiring a very basic level of language at the outset. In reality, this point merely serves to reinforce the point made earlier, that the aim of the pre entry test is benign but comparatively modest. The real question is whether a fair balance has been struck. (d) A fair balance? We do not have reliable figures on the impact which the pre entry requirement has had on the numbers of applications by partners for entry clearance. Indeed, this is one of the complaints made by the appellants the figures are in the hands of the Secretary of State and she should have been making a systematic study of the effect of the new Rule. The global figures do suggest that there was an upsurge in applications in 2010 before the Rule came into force and a dramatic falling off in 2011. Numbers were up in 2012 but had still not recovered to their 2009 level. The refusal rate was also far higher in the first half of 2012 than it had been in 2009 (the second half of 2012 will also have been affected by the increase in the household income requirements). The lack of systematic information makes it difficult to work out the extent of the interference with the article 8 right at a global level, although it seems clear that there has been some effect. However, it is not so difficult to work out the extent of the interference at an individual level. There will be some applicant partners who already have some command of English; there will be others who can arrange access to appropriate tuition without much difficulty; and among these there will be some who will not find it difficult to attend a test centre. For them the language requirement will not present such an obstacle that it can be termed an unjustified interference with their partners article 8 rights. There will, however, be many applicants who do not already have some command of the English language. Many of these will find it hard to arrange access to appropriate tuition. Dr Jordans evidence is that success in learning English as a second language in a foreign country is affected by factors such as age, education, economic and social position, cultural values, motivation, and quality of instruction. He points out that most people living in under developed countries are at a severe disadvantage due to their lack of contact with English, their low educational level and lack of study skills, their lack of intrinsic motivation, their lack of economic resources, their sometimes very different cultural values and their inability to avail themselves of any worthwhile English language instruction. In his opinion, the grammar based methods of teaching English which are still prevalent in many parts of the world, including the Indian sub continent, are not well suited to acquiring the oral communication skills required by the test. It was the lack of suitable tuition which led the Government originally to delay the introduction of the new requirement (see para 8 above). But the Government has since taken the view that their only responsibility is for the test. But the accessibility of such tuition is relevant to the question of fair balance. For example, people living in remote rural areas may experience serious difficulties in gaining access to suitable tuition, which may only be obtainable at unreasonable cost. There may also be some for whom getting to a test centre for the required 16 to 18 minutes face to face conversation will be impossible or prohibitively expensive. The interference with the article 8 rights of the British partners of the people who face these obstacles is substantial. They are faced with indefinite separation, either from their chosen partner in life, or from their own country, their family, friends and employment here. It is worth recalling that the interference in Aguilar Quila, which was termed colossal, was merely temporary, whereas the interference here may be permanent. The problem lies not so much in the Rule itself, but in the present Guidance, which offers little hope, either through the exceptional circumstances exception to the English language requirement (see paras 17, 18 above), or through the even fainter possibility of entry clearance outside the Rules (see para 20 above). Only a tiny number achieve leave to enter through these routes. This is not surprising given the way in which the Guidance is drafted. The impracticability of acquiring the necessary tuition and practice or of accessing a test centre is not enough. Financial impediments are not enough. Furthermore, all applications for an exception to be made will be considered on a case by case basis. This means that the considerable expense of making an application has to be risked, even though, on the current Guidance, the chances of success are remote. It is not enough to say (see para 7.2 of the Guidance at para 18 above) that partners are expected to be self sufficient without recourse to public funds when they come to this country and can therefore be expected to find the resources to meet this requirement. It is one thing to expect that people coming here will not be dependent upon public funds for their support. It is quite another thing to make it a condition of coming here that the applicant or sponsor expend what for him or her may be unaffordable sums in achieving and demonstrating a very basic level of English. Given the comparatively modest benefits of the pre entry requirement, when set against the very substantial practical problems which some will face in meeting it, the only conclusion is that there are likely to be a significant number of cases in which the present practice does not strike a fair balance as required by article 8. This does not mean that the Rule itself has to be struck down. There will be some cases in which the interference is not too great. The appropriate solution would be to recast the Guidance, to cater for those cases where it is simply impracticable for a person to learn English, or to take the test, in the country of origin, whether because the facilities are non existent or inaccessible because of the distance and expense involved. The guidance should be sufficiently precise, so that anyone for whom it is genuinely impracticable to meet the requirement can predictably be granted an exemption. As was originally proposed, those granted an exemption could be required to undertake, as a condition of entry, to demonstrate the required language skills within a comparatively short period after entry to the UK. Article 14 The appellants also complain that the requirement discriminates against some people in the enjoyment of their article 8 rights on grounds of nationality and may also be discriminatory on grounds of race or ethnicity. On its face, it is directly discriminatory on grounds of nationality. Nationals of the listed countries (see para 13 above) are exempt. I would not, therefore, agree with Beatson J that it is not directly discriminatory because nationals of Anglo phone countries are not similarly situated to nationals of other countries. I agree with Ms Karon Monaghan QC, for Liberty, that it is not possible to use the protected characteristic as a basis for holding that their situations are relevantly different. They are all in the same situation of wanting to come to this country to join their partners who are settled here. However, direct discrimination, even on grounds of nationality, is capable of justification under article 14. In the context of immigration, nationality is not a particularly suspect classification. The appellants complain that the exemptions are irrational. Canadians, for example, are exempt, even though there are many Franco phone Canadians for whom English is not the first language and some for whom it is not even a second language. Nigerians, on the other hand, are not exempt even though English is the medium of instruction in all Nigerian secondary and most Nigerian primary schools. The Anglo phone Caribbean countries are exempt, even though their success rate in the LUK test for ILR is only average. However, in the context of a language requirement, being a national of an Anglo phone country is a reasonable proxy for a sufficient familiarity with the English language to be able to begin to integrate with the local community immediately on arrival. This is a context in which a bright line rule makes sense. If the discrimination were not held justifiable, it would not follow that the English language requirement should be abolished. As with any discriminatory rule of this sort, the choice of cure can either be to level up or to level down. The Government could choose either to abolish the requirement altogether or to apply it to everyone, including partners from the exempt countries. The discrimination argument therefore adds nothing to the article 8 argument, which for the reasons already explained, may lead to the conclusion that Convention rights have been violated in a significant number of cases. Conclusion I would not strike down the Rule or declare it invalid. It will not be an unjustified interference with article 8 rights in all cases. It is capable of being operated in a manner which is compatible with the convention rights. Hence the appellants must be denied the remedy they seek. However, the operation of the Rule, in the light of the present Guidance, is likely to be incompatible with the convention rights of a significant number of sponsors. There may well be some benefit, therefore, both to individuals and to those administering the Rule, in declaring that its application will be incompatible with the Convention rights of a UK citizen or person settled here, in cases where it is impracticable without incurring unreasonable expense for his or her partner to gain access to the necessary tuition or to take the test. But this was not the remedy sought by the appellants and we have received no submissions on it. I would therefore invite such submissions before finally deciding the outcome of this appeal. LORD HODGE: (with whom Lord Hughes agrees) I agree with Lady Hale (a) that there is no basis for striking down rule E ECP 4.1 in Appendix FM to the Immigration Rules and (b) that the guidance, because of the narrowness of the exceptional circumstances for which it allows, may result in a significant number of cases in which peoples article 8 rights will be breached. To avoid that unfortunate outcome, the Government may need to take further steps toward providing opportunities for spouses and partners to meet the requirement or may need to amend its guidance. But I am not persuaded that the court should issue the declaration that she proposes and the range of her criticism of the guidance exceeds my concerns. I therefore set out my views briefly. In para 33 of her judgment Lady Hale summarises the six reasons which the Government have advanced for the introduction of a pre entry English language requirement. They are: (i) to assist the partners integration into United Kingdom society at an early stage; (ii) to improve their employment chances as they have access to the labour market as soon as they arrive; (iii) to raise awareness of the importance of language and to prepare for the tests they will need to pass for settlement in this country; (iv) to save translation costs; (v) to benefit any children the couple may have; and (vi) to reduce the vulnerability of newly arrived spouses, especially women. The appellants led evidence which sought to call into question the extent to which the proposed English language test could achieve those benign aims. Because the IELTS English language test is at a basic A1 level, the appellants argued with some force that its contribution to several of the listed aims may be modest. That may well be so. But like the majority of the Court of Appeal (Maurice Kay LJ (at para 30) and Toulson LJ (at para 52)) I consider that this courts role does not extend to overruling the predictive judgment of the executive branch of government on an issue of social policy at a stage when empirical evidence of the consequences of the policy is unobtainable. In my view the law gives the executive branch a wide margin of appreciation in its assessment of the consequences of its social policy in this sphere. In each of the appeals a female UK citizen has gone overseas and found a spouse from within a community with which she has a connection. Often it may be a male UK citizen who seeks to find a spouse or partner from within his community overseas, and in such cases the sixth purpose listed above may be an important good: the benefit which flows from language competence is not only improved access to advice in event of mistreatment but, more generally, the ability to lead ones life with a degree of independence and autonomy. In any event, it appears to me that the core aim of the policy is the first listed purpose, namely to assist the early integration of the incoming partner into UK society. Aims (ii) (employment), (iii) (raising awareness of integration) and (vi) (reducing vulnerability) are closely connected with this core aim. Together, they are not to be undervalued. It is in the general interest of all in this country that those who join its community become real participants in it, and are seen to do so. I would also not underestimate the value of establishing a minimum language familiarity before entry, since that will help to instil the need for integration. The monitoring of language proficiency subsequently can be difficult; it may be scarcely practicable, as well as harsh, to contemplate removal in the event of failure to achieve it, particularly once a family of children is established. But the debate about the efficacy of the policy to achieve those other aims is water swirling around the rock of the policy of promoting integration and thereby social cohesion within our society. The pre entry test is the first stage of the process of integration. Further, as Lady Hale has shown (para 26), the Strasbourg court has in several cases pointed out that there is no general obligation on a state to facilitate or allow a couple who are married to live within it. This court has made similar observations: ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166, para 19 per Lady Hale; R (Aguilar Quila) v Secretary of State for the Home Department (AIRE Centre intervening) [2012] 1 AC 621, para 42 per Lord Wilson. Mixed nationality couples have no right to set up home in whichever country they choose. International instruments which seek to protect family life need to be read against that background. Nonetheless, the article 12 ECHR right to marry is a strong right (R (Baiai) v Home Secretary [2009] 1 AC 287, para 13 per Lord Bingham), and article 8 ECHR confers a right to respect for the resulting family, which is the fundamental social unit. That protection involves, as Lord Wilson stated in Aguilar Quila (above) at para 42, a fact specific investigation whether the states obstruction of a married couples choice to reside in it is justified under para 2 of article 8. It may well be that, as Lady Hale says (para 34 above), the principal article 8(2) purpose which is relevant is the interests of the economic well being of the country. But the value of social and cultural cohesion, and the reduction of isolation and mistrust, bear also on the rights and freedoms of others already living here. Of the four questions which Lord Wilson posed in Aguilar Quila at para 45, which Lady Hale sets out at para 29 of her judgment, I agree with her conclusions (a) that the legislative objective of integration and social cohesion is sufficiently important to justify limiting a fundamental right, (b) that the measures are rationally connected to that objective and (c) that they are no more than are necessary to accomplish it. The problem which the operation of the policy faces is the fourth question do [the measures] strike a fair balance between the rights of the individual and the interests of the community?. For the reasons which I discuss below, I think that there may be a number of cases in which the operation of the Rule in terms of the current guidance will not strike a fair balance. But there may also be many cases in which it will. The court would not entitled to strike down the Rule unless satisfied that it was incapable of being operated in a proportionate way and so was inherently unjustified in all or nearly all cases: R (MM (Lebanon)) v Secretary of State for the Home Department [2015] 1 WLR 1073, paras 133 and 134 per Aikens LJ. As a result, the appellants fail to show that the rule itself is an unjustifiable interference with article 8 rights. The principal problem which the operation of the rule is likely to confront relates to the availability and accessibility of English language tuition and testing overseas. Beatson J focussed on this matter in the seventh question which he posed for himself in para 81 of his judgment in this case in which he asked: What teaching and testing facilities are available in the countries from which there are significant numbers of applicants, how accessible are those facilities (in terms of geography and cost), and are such tests as are available appropriate for the standard required? In his discussion of the answer to this question (at paras 104 to 109 of his judgment) he recognised that the operation of the policy might give rise to questions of disproportionate interference in individual cases, depending on (a) whether the Home Secretary granted further exemptions to countries where there was no test centre and (b) how her officials dealt with particular cases. At paras 17 to 20 of her judgment Lady Hale sets out the current guidance given to officials on how they should consider exceptional circumstances under E ECP 4.2(c) in Appendix FM of the Immigration Rules. From the emphasis which she has supplied to certain passages in that guidance, it is clear that she takes issue with (a) the exclusion from exceptional circumstances of the lack of or limited literacy or education, and (b) the assertion that it is reasonable to expect the applicants or their sponsor to be able to afford reasonable costs incurred in making their application. I would not impugn either of those requirements in themselves. It is not, at least yet, demonstrated that limited literacy or education makes it unreasonable to expect an applicant to learn rudimentary English, or that the methods of teaching are not adjusted to such limitations, although it is likely to be true that classroom or traditionally grammatical methods are not. To my mind the principal problem which the evidence adduced by the appellants suggests is that within certain states, with which many UK citizens have a close connection, there are areas, including rural areas, from which it may not be reasonably practicable for the incoming spouse or partner to obtain the needed tuition without incurring inordinate cost, for example by having to travel long distances repeatedly or to reside for a prolonged period in an urban centre in order to complete the relevant language course. Dr Geoffrey Jordan suggested in Dr Helena Wrays second report that preparation for the A1 test could involve 90 hours of tuition (para 40). In principle, it is not unreasonable to expect some level of expenditure by the spouse/partner who aspires to live in this country or by the presently resident sponsoring party; the potential financial benefits of life in the UK are significant. But in a particular case the potential cost may be shown to be inordinate, undermining the fair balance which article 8 requires. Dr Jordan also stated that some testing centres offered the A1 speaking and listening test but required English reading skills in order to take it and others offered the test only when it was combined with tests involving reading skills. If that is still the case and it creates a significantly higher hurdle than the A1 test which the UK Government requires, that also might affect the fair balance in an individual case. It is impossible at the moment to predict what level of provision of testing centres will be made, or what identification of sources of tuition. Travel to a major city is likely to be an inevitable part of obtaining entry clearance or of eventual travel to the UK in any event. But the central issue is the accessibility of both tuition providers and approved testing centres which offer the stipulated test without additional language requirements. This will no doubt call for examination on the facts of specific cases. In my view in order to ensure a fair balance the Government should consider amending the guidance to allow officials to consider whether it is reasonably practicable for the incoming spouse to obtain the needed tuition and sit the test without incurring inordinate costs. I agree with Lady Hales approach to the article 14 case in para 58 of her judgment and I agree with the Court of Appeal (para 47) and Beatson J (para 145) that the common law challenge fails. I have concerns about making any declaration of incompatibility as (i) circumstances on the ground in the countries in which incoming spouses or partners reside are likely to be changing over time, (ii) I see little benefit in a generally worded declaration which gives no guidance on what makes it unreasonable to expect the incoming partner to comply with the Rule, and (iii) I am not persuaded that it is appropriate to extend declarations of incompatibility to circumstances outside the scope of section 4 of the Human Rights Act 1998. But I am content with Lady Hales proposal that we should invite submissions from the parties before reaching a concluded view on this suggestion and making our final determination. LORD NEUBERGER: I have had the benefit of reading in draft the judgments of Lady Hale and Lord Hodge. I agree that these two appeals should be dismissed because rule E ECP 4.1 in Appendix FM to the Immigration Rules (the Rule), set out in paras 12 13 above, is lawful. However, I also agree with them that the guidance (the Guidance) contained in para SET 17.9 (updated 15 February 2011) as expanded in the Immigration Directorate Instruction, set out in paras 16 20 above, seems to be bound to result in article 8 rights being infringed on a number of occasions. The Rule imposes what may be called a pre entry English requirement for spousal migrants ie it requires a foreign spouse or partner of a British citizen or person settled in the United Kingdom to produce a test certificate of knowledge of the English language to a prescribed standard prior to entering the United Kingdom, as Maurice Kay LJ described it below [2014] 1 WLR 208, para 1. As he went on to explain, [p]reviously such persons were only required to demonstrate such knowledge two years after entering the United Kingdom, and only then could they obtain indefinite leave to remain (ILR). In these proceedings, the appellants contend that the Rule infringes article 8 and that it therefore should be struck down. There is no doubt that it interferes with article 8 rights, and it therefore has to satisfy the familiar four tests, or Requirements, which are set out by Lady Hale in para 29 above namely, legitimate aim, rational connection, less intrusive means and proportionality. The aims of, or reasons for, the Rule are set out in summary form by Lady Hale at para 33 and by Lord Hodge at para 62. Opinions may no doubt differ as to the relative or absolute importance of each of these six aims, although I agree with Lady Hale and Lord Hodge in thinking that the first, assisting integration into British society at an early stage, is plainly the most important. However, improving employment prospects, benefitting children, and reducing vulnerability (especially of women) all seem to me to be very worthwhile aims, one or more of which could, in some individual cases, turn out to be more significant than the first aim. Accordingly, there can be no doubt but that these aims are plainly legitimate; indeed, they are the sort of aims which one would expect a government to have. The first Requirement, however, is not merely that the aims are legitimate, but that they justify interfering with, or limiting, a Convention right. In this case, the Rule interferes with the article 8 rights of men and women in this country whose partners abroad may be impeded in their attempts to join them in the United Kingdom. Although article 8.1 is very wide in its reach, article 8.2 of course makes it clear that it is not an absolute right, and it does not impose a duty on a state to facilitate, or even to allow, a married couple to live together. The limits on article 8.1 rights in this connection were helpfully summarised by Lady Hale in ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166, para 19. Particularly bearing that factor in mind, it seems to me that, at any rate if taken at face value, the six aims represent a set of reasons which easily serve to enable the Rule to satisfy the first Requirement, as they are sufficiently important to justify the interference with article 8 rights in question. However, the evidence adduced on behalf of the appellants may be said to call into question whether the first Requirement is satisfied. I shall consider that evidence when dealing with the fourth Requirement, proportionality. However, for the purposes of the first Requirement, I am very dubious whether the evidence can, even on a quick reading, assist the appellants. The evidence does not suggest that implementation of the Rule will achieve its purpose in only a negligible number of cases; indeed, it would be surprising if any expert was prepared to say that in the light of the available information. Once it is accepted, as I think it must be, that the Rule is likely to achieve its purpose in a significant number of cases, I believe it must follow that the first Requirement is satisfied. As to the second Requirement, it is not in my judgment realistically possible to argue against the proposition that there is a rational connection between the six aims and the Rule. So far as the third Requirement is concerned, it was contended by the appellants that the Rule had not been shown to be the least intrusive way of achieving the six aims, or, to put it another way, it had not been established as being no more than necessary to achieve the six aims. In this connection, it is worth bearing in mind that the approach of a court to the third Requirement should not be absolutist. Indeed, it has been authoritatively said that the question it involves may be better framed as was the limitation of the protected right one that it was reasonable for the legislature to impose to achieve the legitimate aim, bearing in mind any alternative methods of achieving that aim per Lord Reed in Bank Mellat v HM Treasury (No 2) [2014] 1 AC 700, 791, para 75, citing Dickson CJ in R v Edwards Books and Art Ltd [1986] 2 SCR 713, 781 782. The appellants case, which was accepted by Sir David Keene in his dissenting judgment in the Court of Appeal, [2014] 1 WLR 208, paras 55 59, was based on the pre existing system. He considered that the evidence showed that that system, which involved relatively little interference with article 8 rights, was working satisfactorily, and therefore there was no need for the far more intrusive Rule. The figures provided by the Home Department, which Sir David cited in support of this view, showed that the numbers of spouses who failed the English test under the pre existing system were 3,245 in 2007, 995 in 2008, and 470 in 2009. I am not convinced that these figures assist the contention that the third Requirement is not satisfied. However, at least in relation to this appeal, that is an arid point which it is unnecessary to decide, because they clearly are relevant to the fourth Requirement (which Sir David also relied on in paras 55 59 of his judgment). At any rate, subject to that concern, it appears to me that the third Requirement is clearly satisfied. If there is to be a Regulation ensuring that would be spousal migrants (applicants) attain a specified level of English before coming to the UK, no less an intrusive alternative to the Rule has been suggested. That then leaves the final Requirement, proportionality. In addition to the evidence of figures provided by the Home Department and summarised at the end of para 86 above, the appellants rely on other evidence to which I have already alluded. As Lady Hale explains in paras 43, 44 and 47 of her judgment, the appellants have collated detailed expert assessments, including facts and opinions, from Dr Jordan, Dr Wray and Dr Charsley. In their view, there is real reason to doubt the likely efficacy of the Rule in achieving each of the six aims. They also explain that there will be a number of cases where application of the Rule in accordance with the Guidance is very likely to render it impossibly hard, in practical terms, for a person to attain the necessary proficiency in English or to take the test to prove that he or she has done so. This evidence does give rise to some concern, but I do not consider that it justifies the conclusion that the Rule infringes article 8. So far as the numbers of spousal migrants who fail the post entry test are concerned, it is fair to say that the figures set out at the end of para 86 are relatively small. However, those figures do not take into account the possibility that, once in the UK, some spousal migrants may never apply for ILR, and therefore have not been taken into account. Further, the Home Departments 2009 Equality Impact Assessment identified foreign spouses as the largest group who do not pass the English test after two years. It is therefore apparent that a significant proportion of spousal migrants who entered the UK each year did not learn English to the requisite standard during the two years following their arrival, but it is not possible to identify the precise proportion. That means that, each year, there was a significant, but unspecified, number of spousal migrants who (i) remained in the UK not speaking English, (ii) were deported after having lived here for more than two years, or (iii) learned English later. Both the available evidence and common sense lend support for the notion that category (ii) and, albeit more speculatively, category (iii), includes many fewer people than category (i). Even spousal migrants who, under the pre existing system, learned English after arriving were, at least on the Departments not unreasonable assessment, in a weaker position than they would be under the Rule, because the effect of the Rule is that spousal migrants learn English before arriving here and are therefore able to hit the ground running. As for the experts, they were not saying that the implementation of the Rule could do nothing to achieve the stated aims: they are sceptical whether it will do so to any significant extent, and they are concerned that it may, in some respects, be counter productive. They also consider that there will be many people for whom the possibility of learning English, or taking the relevant test, in their home country would be impossible or near impossible. The likelihood of, and the extent to which, the six aims will be achieved by implementing the Rule is, in the end, a matter of judgment, on which it is virtually inevitable that reasonable people who have carefully considered the matter, whether or not with any particular expertise, will differ. Similarly, it is very hard to assess how many people would be put in difficulties by having to comply with the Rule, and how great or insurmountable those difficulties might be. There is no reliable, objective, quantitative evidence available on any of those issues. Accordingly, it is unsurprising, that the appellants are able to rely on opinion evidence, which is based on experience and judgment. Given that it is not inherently improbable and that it comes from properly qualified and experienced experts, this evidence is worthy of respect. However, any court should be very slow indeed before relying on such evidence as the sole or main justification for invalidating government policy, particularly when the policy concerns a sensitive social issue, and the main aim of the policy is fairly described as benign, as Lady Hale says in para 41 above. As to the concerns about hardship or impossibility, when considering individual cases a great deal may depend on how the Rule is operated. However, the instant claims have been launched and argued on the basis of challenging the Rule in limine, and not how it is operated, let alone how it would have been applied in these two cases. It is true that it appears quite possible that the effect of implementing the Rule may not be particularly substantial. However, the court should accord to the executive a wide measure of discretion when deciding on the likely value of a policy such as that embodied in the Rule. Furthermore, the Home Department carried out two substantial Impact Assessments and two substantial Equality Impact Assessments before deciding to introduce the Rule, albeit that those assessments were not directed to the issue raised in these two cases, namely the impact on article 8 rights of people in this country. As Toulson LJ said in para 51 in the Court of Appeal, there is an inevitable degree of crystal ball gazing, when it comes to an experimental scheme such as that embodied in the Rule. In such a case, one must be wary of complaining about the lack of a quantitative or precise assessment of the extent of the likely benefits, and it is fair to add that no such complaint has been advanced. Where, as here, such an assessment is not a practical possibility, to insist on one would have two possible consequences, each of which would be unfortunate. First, it could lead to the abandonment of experimental policies, however well thought out they may be and however successfully they may have turned out. Alternatively, it could encourage artificial or bogus cost benefit and other quantitative analyses, which are already by no means unknown, and which devalue properly based quantitative analyses. I also agree that the challenge to the Rule based on article 14 also fails for the I agree therefore that (a) the Rule has a legitimate purpose, namely the six aims referred to above, which is sufficiently important to justify interfering with the lives of persons in the UK who wish to be united here with partners who are currently abroad, (b) there is plainly a rational connection between the Rule and its aims, (c) the provisions of the Rule are no more than is necessary to accomplish its aims, and (d) bearing in mind the wide measure of discretion which should be accorded to the executive in a case such as this and the research that was done in anticipation, the Rule strikes a fair balance between the rights of individuals and the interests of the community. reasons given by Lady Hale. Accordingly, for the reasons more fully given by Lady Hale and Lord Hodge (whose judgments have nuanced differences in their approaches, but whose essential reasoning appears to be the same), and in agreement with the conclusion reached by Maurice Kay and Toulson LJJ, I would dismiss these appeals. However, I have concerns about the Guidance. It does appear virtually certain that there will be a significant number of cases where application of the Guidance will lead to infringement of article 8 rights. By way of example, it may be impossible, in any practical sense, for a potential applicant to obtain access to a tuition and/or to a test centre. In particular, it appears that, in some countries, a person in a remote rural home either would have to travel repeatedly to and from a tuition centre many hundreds of miles away, or would have to find the money to rent a place to live near the tuition centre. Depending on the circumstances of the potential applicant, this may well render reliance on the Rule disproportionate. And, as Lady Hale points out, reliance on the absolute exclusion in the Guidance of [l]ack of or limited literacy or education from the category of exceptional circumstances, and the broad statement that it is reasonable to expect that [applicants] (or their sponsor ) will generally be able to afford reasonable costs incurred in making their application could easily lead to inappropriate outcomes in individual cases. Accordingly, I share Lady Hales concerns expressed in para 53, and it is also right to say that I also agree with what Lord Hodge says in para 73. In those circumstances, I see considerable attraction in granting declaratory relief to reflect the concerns we have about the application of the Guidance. This is an important and sensitive topic, and it could be unfortunate if there was no formal record of this courts concern about the application of the Guidance. That is particularly true given the public expenditure which has been devoted to these proceedings, coupled with the fact that a declaration may avoid the expenditure of further costs on subsequent proceedings involving a challenge to the Guidance. And a formal declaration now would avoid any further delay involved in establishing the correct approach to be adopted to applicants. However, it would be wrong to contemplate making, or even to speculate about the possible terms of, a declaration without first giving the parties the opportunity of making written submissions on the appropriateness of such a course and the terms of any potential declaration. While I am sympathetic to the notion of granting a declaration, it is only fair to add that it would be an unusual course to take (given that it has only been the Rule which was under attack in these proceedings), and to acknowledge that the Secretary of State may well persuade us that, if it was drafted so as to reflect our views at this stage, any declaration would be too unspecific to be helpful or would be otherwise inappropriate.

The appellants in these cases challenged the validity of an amendment to the Immigration Rules in 2010 requiring a foreign spouse or partner of a British citizen or person settled in the United Kingdom to pass a test of competence in the English language before coming to live here (rule E ECP 4.1 and E LTRP 4.1 in Appendix FM) (the Rule). They argued that the Rule itself is an unjustifiable interference with the right to respect for private and family life protected by article 8 of the European Convention on Human Rights (ECHR) and/or is unjustifiably discriminatory in securing the enjoyment that right contrary to article 14, or unlawful by reason of its irrationality. The Governments objectives in introducing the pre entry English requirement for spouses and partners were (a) to assist the spouse or partners integration into British society at an early stage, (b) to improve employment chances for those who have access to the labour market, (c) to raise awareness of the importance of language and to prepare for the tests that the spouses or partners would later have to pass to settle indefinitely in the UK, (d) to save translation costs, (e) to benefit any children the couple might have and (f) to reduce the vulnerability of newly arrived spouses, especially women. The Rule requires spouses and partners to show the ability to speak English at a basic level by passing a test with an approved test provider unless exceptional circumstances are shown. Guidance accompanying the Rule makes it clear that exceptional circumstances will rarely arise and do not include financial reasons or lack of literacy. The appellants are UK citizens who have been married to foreigners since 2009 and 2010 respectively. Their husbands are unable to satisfy the pre entry language requirement, in Saiqa Bibis case because he would have to relocate to Rawalpindi in Pakistan for several months, which is not affordable, and in Mrs Alis case because there is no test centre in the Yemen where they have had to live. The High Court held that the Rule itself was not unlawful. The Court of Appeal by a majority upheld the High Courts decision. The Supreme Court unanimously dismisses the appeal in respect of the finding that the Rule itself does not infringe article 8, but it invites further submissions from the parties on whether a declaration should be made that the operation of the Guidance in its present form is incompatible with article 8 rights where compliance with the requirement is impracticable. Three justices give substantive judgments: Lady Hale (with whom Lord Wilson agrees), Lord Hodge (with whom Lord Hughes agrees) and Lord Neuberger. The right to respect for family life guaranteed by the ECHR includes the right of married couples to live together, but article 8 does not impose a general obligation on the part of a state to respect the choice by married couples of the country of their matrimonial residence and to accept the non national spouses for settlement in that country [25 26]. However, interference with the right must still be proportionate, striking a fair balance between the interests of the individuals and the community as a whole [29]: The six objectives of the Rule are intended to protect the interests of the economic well being of the country or perhaps the protection of the rights and freedoms of others. Assisting the spouse or partners integration into British society at an early stage is undoubtedly an important and benign aim for which even a basic level of English language skills would be of some benefit. Evidence filed by the appellants casts doubt on the value of the test in getting the learner off to a flying start compared with the opportunities to learn after arrival, but the aim is legitimate and sufficiently important to justify interference with the article 8 right [30 45] There is a rational connection between the Rule and the aim it seeks to achieve. It will make a contribution to the overall aim of promoting integration [46] The Rule is no more than necessary to achieve this contribution [47 48] The impact of the pre entry language requirement has not been systematically studied by the Secretary of State but it is obvious that at an individual level access to appropriate tuition and a test centre may prove such an obstacle that it amounts to an unjustified interference with their partners article 8 rights [50]. However, the problem lies not in the Rule itself but in the restrictive interpretation of exceptional circumstances in the Guidance which means there are likely to be a significant number of cases in which the present practice does not strike the fair balance required by article 8 [53 55]. The discrimination claim adds nothing to the claim under article 8: the exemption for nationals of Anglophone countries makes sense and direct discrimination on grounds of nationality could be justified under article 14 [56 59]. Accordingly, the Rule itself is not disproportionate. Lady Hale suggests that the appropriate solution to avoid infringements in individual cases would be to recast the Guidance to grant exemptions in cases where compliance with the requirement is simply impracticable, and one remedy might be for the court to declare that the present application of the Guidance is incompatible with the rights of individuals in such circumstances. Since this was not a remedy sought by the appellants the Court should invite further submissions before finally deciding the outcome of the appeal [55, 60]. Lord Hodge agrees that there is no basis for striking down the Rule and that the Guidance may result in a significant number of cases in which the article 8 rights of individuals will be breached, where, for example the cost is inordinate. He is not persuaded that a declaration relating to the Guidance is appropriate but is content to reach a concluded view after further submissions [61 76]. Lord Neuberger agrees that the Guidance seems bound to result in the infringement of article 8 rights in individual cases but that the Rule itself is not disproportionate, bearing in mind the wide measure of discretion which should be accorded to the executive in a case such as this and the research that was done in anticipation [98]. He is sympathetic to the proposed declaration relating to the Guidance but agrees that it would be wrong to make it without considering further submissions [104].

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These appeals concern requests made for the surrender under Part 1 of the Extradition Act 2003 of three persons wanted to serve sentences imposed upon their conviction in other member states of the European Union. The requests relating to the appellants Mindaugas Bucnys (Bucnys) and Marius Sakalis (Sakalis) come from the Ministry of Justice of the Republic of Lithuania. The third request, relating to the respondent Dimitri Lavrov (Lavrov), comes from the Ministry of Justice of the Republic of Estonia. The Ministries made the requests in the form of European arrest warrants intended to meet the requirements of Council Framework Decision 2002/584/JHA on the European arrest warrant and surrender procedures between member states of the European Union (the Framework Decision). Within the United Kingdom, Part 1 of the Extradition Act 2003 was enacted to give effect to the same requirements. Under section 2(7) of the 2003 Act the requests were, after receipt in this country, certified by the Serious Organised Crime Agency (SOCA), the designated authority under section 2(9), as Part 1 warrants issued by a judicial authority of a category 1 territory having the function of issuing arrest warrants. The questions of principle raised by the present appeals are whether the requests are open to challenge on the basis that (i) they were not the product of a judicial decision by a judicial authority within the terms of the Framework Decision and/or of Part 1 of the United Kingdom Extradition Act 2003, and (ii) the Ministries making them did not have the function of issuing domestic arrest warrants and were incorrectly certified by SOCA under section 2(7) of the 2003 Act. If a challenge is open on either or both of these bases, the third question is (iii) whether the challenge is on the evidence well founded in the case of either or both of the Ministries. The Administrative Court (Aikens LJ and Globe J) on 12 December 2012 answered the first question in the affirmative and the second in the negative: [2013] 1 All ER 1220. As to the third, it concluded that a ministry of justice would under European law be regarded as a judicial authority for the purposes of issuing a conviction warrant if it was sufficiently independent of the executive for the purposes of making that judicial decision (para 98); it held further that the antecedent process, in the form of a request for the issue of a European arrest warrant coming from the court responsible for the conviction, was relevant, and that, in the light of these considerations, the requests made by the Ministry of Justice of Lithuania in the cases of Bucnys and Sakalis were valid, while the request made by the Ministry of Justice of Estonia in the case of Lavrov was invalid. Bucnys and Sakalis now appeal, while the Estonian Ministry appeals in the case of Lavrov. The bases of the requests The request in respect of Bucnys results from his conviction for six housebreaking and one fraud offences, for which a total sentence of 5 years 4 months was passed on 29 February 2007. He was released conditionally by the Alytus Region District Courts order on 12 September 2008, but on 20 February 2010 the Vilnius City 1st District Court quashed his conditional release for failure to abide by the condition, requiring him to serve a further period of 1 year 7 months 28 days. The request for his surrender was expressed to be based on this court order dated 20 February 2010. Since preparing this judgment, the court has been informed by those instructed by Bucnys that he has died, presumably since the hearing. The issue raised remains of general importance, and this judgment records the Courts conclusions on it. Sakalis is wanted as a result of his conviction of a series of serious sexual assaults, including buggery, inflicted on the same victim on 28 October 2006. A sentence of 4 years was imposed by the Vilnius City 1st District Court on 25 January 2008, and his appeal was dismissed in his absence by the Vilnius County Court on 24 December 2008. Sakalis absconded before serving any part of this sentence. The request for his surrender was issued by the Minister of Justice signing as representative of the Ministry of Justice. Lavrov is wanted as a result of murder of an invalid paranoid schizophrenic in the nursing home where Lavrov worked as a medical orderly. He was sentenced to 13 years imprisonment on 23 March 2001, released on parole on 14 July 2008 with an obligation to fulfil supervision requirements. He was recalled to prison by the Viru County Court on 2 December 2009 for failure to fulfil such requirements, meaning that he would have to serve a further 4 years 2 months and 25 days in prison, but he absconded. On 9 February 2010 the Viru County Court issued an arrest warrant. On 10 February 2011, it sent a request to the Ministry of Justice to issue a warrant, leading to the Head of the Ministrys International Cooperation Unit issuing the request in issue dated 31 May 2011, expressed to be on the basis of the warrant dated 9 February 2010. Extradition Act 2003 and Framework Decision of Schedule 13 to, the Police and Justice Act 2006, reads: Section 2 of the 2003 Act, as amended by section 42 of, and paragraph 1(1) Part 1 warrant and certificate (1) This section applies if the designated authority receives a Part 1 warrant in respect of a person. (2) A Part 1 warrant is an arrest warrant which is issued by a judicial authority of a category 1 territory and which contains (a) . , or (b) the statement referred to in subsection (5) and the information referred to in subsection (6) . (5) The statement is one that (a) the person in respect of whom the Part 1 warrant is issued has been convicted of an offence specified in the warrant by a court in the category 1 territory, and (b) the Part 1 warrant is issued with a view to his arrest and extradition to the category 1 territory for the purpose of being sentenced for the offence or of serving a sentence of imprisonment or another form of detention imposed in respect of the offence. (6) The information is (a) particulars of the person's identity; (b) particulars of the conviction; (c) particulars of any other warrant issued in the category 1 territory for the person's arrest in respect of the offence; (d) particulars of the sentence which may be imposed under the law of the category 1 territory in respect of the offence, if the person has not been sentenced for the offence; (e) particulars of the sentence which has been imposed under the law of the category 1 territory in respect of the offence, if the person has been sentenced for the offence. (7) The designated authority may issue a certificate under this section if it believes that the authority which issued the Part 1 warrant has the function of issuing arrest warrants in the category 1 territory. (8) A certificate under this section must certify that the authority which issued the Part 1 warrant has the function of issuing arrest warrants in the category 1 territory. (9) The designated authority is the authority designated for the purposes of this Part by order made by the Secretary of State. The Framework Decision was a third pillar measure agreed between member states under Title VI of the Treaty on European Union (TEU) in its pre Lisbon Treaty form. The heading of Title VI is Provisions on Police and Judicial Cooperation in Criminal Matters. The Framework Decision was expressed to be made with regard to the TEU and in particular Article 31(a) and (b) [sic] and Article 34(2)(b) thereof. Article 31(1)(a) and (b) are for present purposes relevant: 31(1). Common action on judicial cooperation in criminal matters shall include: (a) facilitating and accelerating cooperation between competent ministries and judicial or equivalent authorities of the member states, including, where appropriate, cooperation through Eurojust, in relation to proceedings and the enforcement of decisions; (b) facilitating extradition between member states; . The Framework Decision starts with recitals, stating inter alia: (5) The objective set for the Union to become an area of freedom, security and justice leads to abolishing extradition between member states and replacing it by a system of surrender between judicial authorities. Further, the introduction of a new simplified system of surrender of sentenced or suspected persons for the purposes of execution or prosecution of criminal sentences makes it possible to remove the complexity and potential for delay inherent in the present extradition procedures. Traditional cooperation relations which have prevailed up till now between member states should be replaced by a system of free movement of judicial decisions in criminal matters, covering both pre sentence and final decisions, within an area of freedom, security and justice. (6) The European arrest warrant provided for in this Framework Decision is the first concrete measure in the field of criminal law implementing the principle of mutual recognition which the European Council referred to as the cornerstone of judicial cooperation. (8) Decisions on the execution of the European arrest warrant must be subject to sufficient controls, which means that a judicial authority of the member state where the requested person has been arrested will have to take the decision on his or her surrender. (9) The role of central authorities in the execution of a European arrest warrant must be limited to practical and administrative assistance. The text of the Framework Decision provides: GENERAL PRINCIPLES Article 1 Definition of the European arrest warrant and obligation to execute it 1. The European arrest warrant is a judicial decision issued by a member state with a view to the arrest and surrender by another member state of a requested person, for the purposes of conducting a criminal prosecution or executing a custodial sentence or detention order. 2. Member states shall execute any European arrest warrant on the basis of the principle of mutual recognition and in accordance with the provisions of this Framework Decision. 3. This Framework Decision shall not have the effect of modifying the obligation to respect fundamental rights and fundamental legal principles as enshrined in Article 6 of the Treaty on European Union. Article 6 Determination of the competent judicial authorities 1. The issuing judicial authority shall be the judicial authority of the issuing member state which is competent to issue a European arrest warrant by virtue of the law of that State. 2. The executing judicial authority shall be the judicial authority of the executing member state which is competent to execute the European arrest warrant by virtue of the law of that state. 3. Each member state shall inform the General Secretariat of the Council of the competent judicial authority under its law. Article 7 Recourse to the central authority 1. Each member state may designate a central authority or, when its legal system so provides, more than one central authority to assist the competent judicial authorities. 2. A member state may, if it is necessary as a result of the organisation of its internal judicial system, make its central authority(ies) responsible for the administrative transmission and reception of European arrest warrants as well as for all other official correspondence relating thereto. Member state wishing to make use of the possibilities referred to in this article shall communicate to the General Secretariat of the Council information relating to the designated central authority or central authorities. These indications shall be binding upon all the authorities of the issuing member state. Article 8 Content and form of the European arrest warrant 1. The European arrest warrant shall contain the following information set out in accordance with the form contained in the Annex: (a) the identity and nationality of the requested person; (b) the name, address, telephone and fax numbers and e mail address of the issuing judicial authority; (c) evidence of an enforceable judgment, an arrest warrant or any other enforceable judicial decision having the same effect, coming within the scope of articles 1 and 2; (d) the nature and legal classification of the offence, particularly in respect of article 2; (e) a description of the circumstances in which the offence was committed, including the time, place and degree of participation in the offence by the requested person; (f) the penalty imposed, if there is a final judgment, or the prescribed scale of penalties for the offence under the law of the issuing member state; (g) if possible, other consequences of the offence. SURRENDER PROCEDURE Article 9 Transmission of a European arrest warrant 1. When the location of the requested person is known, the issuing judicial authority may transmit the European arrest warrant directly to the executing judicial authority. 2. The issuing judicial authority may, in any event, decide to issue an alert for the requested person in the Schengen Information System (SIS). 3. Such an alert shall be effected in accordance with the provisions of article 95 of the Convention of 19 June 1990 implementing the Schengen Agreement of 14 June 1985 on the gradual abolition of controls at common borders. An alert in the Schengen Information System shall be equivalent to a European arrest warrant accompanied by the information set out in article 8(1). For a transitional period, until the SIS is capable of transmitting all the information described in article 8, the alert shall be equivalent to a European arrest warrant pending the receipt of the original in due and proper form by the executing judicial authority. Status of designation under article 6 and of SOCA certification under section 2(7) The first two questions identified in paragraph 3 above are inter related. Part 1 of the 2003 Act was enacted to give effect to the United Kingdoms international obligations contained in the Framework Decision. By its decision in Assange [2012] 2 AC 471 this court underlined the strength of the presumption that it did so fully and effectively. The Ministries submit that article 6 of the Framework Decision was intended to leave it to each member state to define its own judicial authority or authorities for the purposes of the Framework Decision, as best suited it; the information given by each state to the General Secretariat of the Council of the competent judicial authority under its law should be taken as conclusive, pursuant to the same spirit of mutual trust as underlies the Framework Decision itself; and section 2(7) of the 2003 Act must be taken as having been intended to involve a simple check by SOCA of the information received by the Secretariat, leading to a certificate issued by SOCA which must itself be taken as binding on the question whether the Part 1 warrant was issued by a competent judicial authority for the purposes of the 2003 Act. In a number of domestic authorities, the Ministries analysis has been accepted: Enander v Governor of Brixton Prison [2006] 1 CMLR 999, where Openshaw J thought that any further inquiry would be attended with considerable practical difficulty, it would be fraught with uncertainty, and would deprive the Act of its efficacy and cannot, in my judgment, have been intended by Parliament (para 30), Goatley v HM Advocate 2008 JC 1 and Harmatos v Office of the King's Prosecutor in Dendermonde, Belgium [2011] EWHC 1598 (Admin). In more recent authorities, a different attitude has been taken. At first instance in Assange [2011] EWHC 2849 (Admin), para 17, Sir John Thomas P, giving the judgment of the Divisional Court of the Queens Bench Division thought that: it is clear that in the present state of development of the common area for justice, mutual confidence in the common area for justice and the operation of the EAW will not be advanced unless the courts of the executing state scrutinise requests for surrender under the EAW with the intensity required by the circumstances of each case. Later, he said: 46. Although the approach in Enander is one that will ordinarily apply, the designation under article 6 does not, in our view, always compel the recognition by another member state as conclusive, if the authority is self evidently not a judicial authority within the meaning of that broad term in the Framework Decision. It is of some interest to note in the light of our observation at para 37 on the status of a Ministry of Justice that in 2007 the Commissioner for Justice and Home Affairs in the Report on the Evaluation of the Transposition of the Framework Decision stated that the designation by some states directly or indirectly of the Ministry of Justice as a judicial authority was contrary to the terms of the Framework Decision. However there appear to have no instances where the Commission has taken action in respect of a body that should not have been designated as a judicial authority. 47. For example, if a warrant was issued by a Ministry of Justice which the member state had designated as an authority under article 6, it would not, in our view, be a valid EAW under the Framework Decision. The principles of mutual recognition and mutual confidence which underpin the common area for justice would not require the recognition of such a warrant, as it would self evidently not have been issued by a body which, on principles universally accepted in Europe, was judicial. In our view a national judge within the European Union is bound to uphold the principles of mutual recognition and mutual confidence for the reasons we have given at para 17; public confidence in the EAW would only be undermined by the recognition of an EAW issued by a Ministry of Justice in contradistinction to an EAW issued by a judge or prosecutor. 48. It was accepted by Miss Montgomery QC (who appeared for the prosecutor) that if circumstances arose where it could be said that the person issuing the EAW was not a judicial authority, the designating certificate issued by SOCA would not be conclusive. It would have to be challenged by judicial review. She was right to accept that the certificate was not conclusive, as under section 2(8) of the 2003 Act the function entrusted to SOCA is to certify that the issuing authority has the function of issuing EAWs. It does not certify that it is a judicial authority. In Dhar v National Office of the Public Prosecution Service, The Netherlands [2012] EWHC 697 (Admin), King J pursued the same theme, saying: 38. True it is that the certificate must be certifying that the issuing authority has been designated by the law of the requesting state as the competent judicial authority for the purpose of issuing such warrants and that the requesting state has given notice to this effect to the General Secretariat of the European council pursuant to article 6(3) of the Framework Decision, but this is not the same in my judgment as certifying that such designated authority is as a matter of fact a judicial authority within the meaning of section 2(2). 39. Hence in my judgment it must be open, the grant of the certificate under section 2(7) notwithstanding, to this appellant to raise on this appeal (as he could have done before the District Judge) the issue whether the warrant was an invalid Part 1 warrant on the grounds that the purported issuing authority was not a judicial authority within the meaning of section 2(2) of the Act. When Assange was before the Supreme Court [2012] 2 AC 471, Miss Montgomery initially maintained the attitude she had taken in the Administrative Court, but in a late change of stance she aligned herself with the Lord Advocate for Scotlands written intervention advancing the same case as the present Ministries. In the event, the majority decision on other points made it unnecessary to decide this point: see per Lord Phillips of Worth Matravers at paras 81 82. However, Lord Kerr of Tonaghmore and I expressed views obiter that article 6 did not mean that any authority about which information was given to the Council Secretariat was ipso facto judicial (paras 105 and 238). Mr Knowles QC for the Ministries of Justice on the present appeal submits that, although Lord Phillips said that he was leaving the point open, he had in effect answered it in reasoning with which other members of the majority concurred. Mr Knowles points out that Miss Montgomerys wider submission in Assange was that, although judicial authority had a broad and autonomous meaning, this meaning describes any person or body authorised to play a part in the judicial process (Lord Phillips judgment, para 5); and that at para 76 Lord Phillips concluded that the issuing judicial authority bears the wider meaning for which Miss Montgomery contends and embraces the Prosecutor in the present case. Mr Knowless submission reads more into these passages in Assange than can be justified. By authorised to play a part in the judicial process must have been meant more than simply authorised to issue a European arrest warrant domestically and designated to the Secretariat under article 6(3). Otherwise, there would be no autonomous content at all. Even if one takes the sens vague of autorit judiciare which Lord Phillips approved in paras 18 and 65, this does not make an unlimited (only a wider) range of authorities eligible to be regarded as judicial. Such authorities must be at the least authorities qui appartient la justice, par opp[osition] legislative et administrative. Further, and most importantly, it is clear that the ratio of Assange was and is confined to the status of public prosecutor, and that other members of the majority cannot be taken as necessarily having agreed with all that Lord Phillips said on a number of points: see eg Lord Walker of Gestingthorpe at para 91, Lord Brown of Eaton under Heywood at para 95, Lord Kerr generally and Lord Dyson at paras 155 to 159 and 171. Finally, in the present case, the Administrative Court also disagreed with Enander [2006] 1 CMLR 999 and Harmatos [2011] EWHC 1598 (Admin) in so far as they stated that any certificate issued by SOCA under section 2(7) was conclusive or could only be challenged by judicial review, and preferred the views expressed on this aspect by King J in Dhar and by Lord Kerr and myself in Assange. Status and interpretation of Framework Decision For reasons explained in this Court in Assange [2012] 2 AC 471, paras 208 217, the Framework Decision falls outside the scope of the European Communities Act 1972. It is true, as Aikens LJ observed in para 48 of his judgment in this case, that this makes inapplicable the provision in section 3 of the 1972 Act imposing a duty on domestic courts to treat any question as to the meaning of any European Treaty or any European Union instrument as a question of law to be determined in accordance with the principles laid down by the European Court of Justice. But, viewing the Framework Decision as an international measure having direct effect only at an international level, the United Kingdom must still have contemplated that it would be interpreted uniformly and according to accepted European legal principles. When applying the common law presumption that Part 1 of the 2003 Act gives effect to the United Kingdoms international obligations fully and consistently (Assange, paras 201 and 204 206), I would therefore think it appropriate to have regard to European legal principles in interpreting the Framework Decision. Ultimately, however, this is not a point which I see as critical to these appeals. The recitals to the Framework Decision emphasise the importance being attached to the replacement of traditional cooperation relations by a system of surrender between judicial authorities and of free movement of judicial decisions. Article 1 emphasises at its outset that a European arrest warrant is a judicial decision, while article 6 states that the issuing [or the executing] judicial authority shall be the judicial authority of the issuing [or executing] member state which is competent to issue a [or execute the] European arrest warrant by virtue of the law of that state. Under European law, if a matter is left expressly to national law, then that must be the basic approach. In contrast, if there is no reference to national law at all, then a concept may well fall to be given an autonomous meaning: see eg Criminal Proceedings against Kozlowski (Case C 66/08) [2009] QB 307, paras 42 43 and Criminal Proceedings against Mantello (Case 261/09) [2010] ECR I 11477, para 38. But even concepts the meaning of which is left to national law may require to be construed as subject to limitations deriving from general European legal principles: see eg Eman v College van burgemeester en wethouders van Den Haag (Case C 300/04) [2007] All ER (EC) 486. As a matter of construction, the provision in article 6(3) that each member state shall inform the Secretariat of the competent judicial authority under its law cannot in my view be read as making such information unchallengeable and binding all other member states to accept any authority whatever as judicial which any member state chooses to designate and nominate as such. In the light of the recitals and articles 1 and 6(1) and (2), the proper view of article 6(3) may well be that it does no more than address the question which judicial authority is competent. But, even if that is wrong, its language is too unspecific to remove from all scrutiny the question whether the authority nominated really does fulfil the express purpose of the Framework Decision to replace the traditional executive liaison with a new system of judicial cooperation between judicial authorities by virtue of judicial decisions. The Framework Decision must be viewed in the light of Title VI under which it was made. The pre Lisbon Treaty on European Union operated largely on a traditional, inter governmental basis. But it provided a structure of objectives, principles, powers and procedures within which individual measures such as the Framework Decision fell to be agreed and operated. The Framework Decision is a subsidiary measure, which must be interpreted subject to the general objectives and principles of and powers conferred by that Treaty: see Edward and Lane, European Union Law, 3rd ed (2013), paras 6.23 6.24. It is relevant that Title VI not only provides for judicial cooperation, but that the language of article 31(1)(a) one of the express jurisdictional bases of the Framework Decision (see para 9 above) expressly distinguishes between competent ministries and judicial or equivalent authorities. It is in my view implausible to suggest that, under the law of the European Union, the concept judicial in Title VI has no autonomous content whatever. If that is so, then the concept in the Framework Decision cannot give member states carte blanche to agree that each of them could put whatever meaning they chose upon the concept for the purposes of that measure. Further, even if the boundaries of judicial are under Title VI to be regarded as potentially limitless according to the nature and context of the powers being exercised, it by no means follows that the concept has equal width in the context of a specific measure like the Framework Decision. In this context, it does not to my mind advance the argument far to say that member states must be taken to trust each other, or that the Framework Decision was designed (as it clearly was) to eliminate delay and complexity (Dabas v High Court of Justice in Madrid, Spain [2007] UKHL 6, [2007] 2 AC 31, para 53, per Lord Hope of Craighead). The Framework Decision was agreed between member states. But, in a sensitive area which could involve the surrender of a member states own citizens, it was only agreed on the fundamental premise that the relevant decisions would be taken by and the relevant trust existed between judicial authorities. As Sir John Thomas observed, public confidence would not be advanced if this meant whatever individual member states chose it to mean. In a measure designed to do away with executive involvement, it is also unlikely that European law would leave it to the executive to identify whatever authority it chose as judicial. Even Lord Phillips sens vague interpretation of judicial authority distinguishes between an authority belonging to the system of justice, as opposed to the legislature or administration; and the distinction cannot be elided by accepting that any authority given the function of issuing a European arrest warrant must ex hypothesi be judicial. Section 2(7) of the 2003 Act Section 2(7) of the 2003 Act does not take the Ministries further. First, if the case advanced by Bucnys, Sakalis and Lavrov is right, then section 2(7) does not reflect article 6. Rather, it represents an additional safeguard, of the sort which Lord Hope in Office of the Kings Prosecutor, Brussels v Cando Armas [2006] 2 AC 1, para 24 contemplated that Parliament might have included. The safeguard would require any judicial authority requesting surrender to be an authority with general authority to issue domestic arrest warrants. But, second, if that is wrong, then the certificate contemplated by section 2(7) is not concerned with the question whether an authority is judicial. The certificate is to state that the authority which issued the Part 1 warrant has the function of issuing arrest warrants in the issuing territory. Under section 2(2): A part 1 warrant is an arrest warrant which is issued by a judicial authority of the issuing territory. The certificate therefore assumes, but does not certify, that the issuing authority is judicial. If (as I consider) judicial is in the context of the Framework Decision a concept with autonomous content, then sections 2(2) and 2(7) must clearly be read (as they can be) as preserving and reflecting its autonomous meaning. How restricted the boundaries are of that autonomous meaning is a different matter. Bearing in mind the diversity within member states of judicial systems and arrangements, they may be quite relaxed. The Assange case witnesses to this. I will return to this aspect, after considering the second ground of challenge to the requests for surrender. Meaning of section 2(7) The second ground of challenge is that the Ministries of Justice of Lithuania and Estonia did not have the function of issuing domestic, as opposed to European, arrest warrants within their respective states and SOCAs certificates under section 2(7) were as a result invalid. The issue of a certificate under section 2(7) is a critical stage in the execution within the United Kingdom of a European arrest warrant. Without it there can be no arrest under section 3 and the person whose surrender is sought cannot be brought before the appropriate judge under section 4. Where a provisional arrest occurs under section 5, the certificate under section 2(7) must be produced to the judge within 48 hours, or such extended period as the judge may grant. Failing this, the person whose surrender is sought will have to be discharged under section 6. In the case law to date, it appears to have been assumed that the certificate contemplated by section 2(7) is a certificate relating to the function of issuing European arrest (or Part 1) warrants. But Mr James Lewis QC for Bucnys and Sakalis has made a powerful contrary submission, which Mr Alun Jones QC for Lavrov adopts. Mr Lewis points out that the drafters of the Act have been careful to use the concept Part 1 warrant when it first appears in any section, referring thereafter where appropriate simply to the warrant: see eg sections 2(3) and (5), 6(4) and 7(1) and (2). Yet in section 2(7) the drafters used the generic arrest warrants, when they could have used specific wording like such warrants or such a warrant. Further, as the House of Lords held in Louca v Public Prosecutor, Bielefeld, Germany [2009] UKSC 4, [2009] 1 WLR 2550, the words any other warrant in section 2(4) do refer to any domestic arrest warrant that may exist. On the other hand, section 2(2) makes clear that a Part 1 warrant is a type of arrest warrant, there were strong contextual reasons for the conclusion in Louca and it is possible that the drafters did not use the phrase such warrants in section 2(7) because other member states do not have Part 1 warrants; rather they issue European arrest warrants or some other nationally expressed equivalent, when giving effect to the Framework Decision. Mr Lewis responds to this last point by noting that, if the drafters had had in mind the authority which had the function under domestic law of issuing European arrest warrants and was so designated under article 6(3), they could easily have made this clear by substituting for the last 18 words of section 2(7) words such as has been designated to the Secretariat of the Council of Ministers under article 6(3) of the Framework Decision as having the function of issuing European arrest warrants in the category 1 territory. If section 2(7) were intended as a safeguard, it would have odd features. First, it would require SOCA to investigate overseas practice, rather than look at the information given to the Secretariat under article 6(3) of the Framework Decision. Second, it would mean that SOCA should refuse a certificate in respect of any request coming from a state which chose to assign competence to issue European arrest warrants to a specialist or different (perhaps a higher) judicial body than that responsible for domestic arrest warrants. It is true that in the present certificates SOCA certified, inter alia, that the Part 1 warrants issued by the Ministries of Justice were issued by a judicial authority, with the function of issuing arrest warrants. But it was no part of their statutory function to purport to certify the judicial nature of the issuers, and their doing so can have had no effect in law if the authority certified was not truly judicial within the meaning of the Framework Decision and Act. Mr Lewis submits that a conclusive indication as to the nature of the function of issuing arrest warrants to which section 2(7) refers is provided by section 212. Section 212 deals with alerts issued at the request of an authority of a category 1 territory under article 95 of the Convention implementing the Schengen Agreement of 14 June 1985 (OJ L 239, p 19). The history of section 212 is described in para 258 of my judgment in Assange [2012] 2 AC 471. Article 95 reads: 95.1. Data on persons wanted for arrest for extradition purposes shall be entered at the request of the judicial authority of the requesting contracting party. 2. Before issuing an alert, the contracting party shall check whether the arrest is authorised under the national law of the requested contracting parties. If the contracting party issuing the alert has any doubts, it must consult the other contracting parties concerned. The contracting party issuing the alert shall send the requested contracting parties by the quickest means possible both the alert and the following essential information relating to the case: (a) the authority which issued the request for arrest; (b) whether there is an arrest warrant or other document having the same legal effect, or an enforceable judgment; (c) the nature and legal classification of the offence; (d) a description of the circumstances in which the offence was committed, including the time, place and the degree of participation in the offence by the person for whom the alert has been issued; (e) in so far as is possible, the consequences of the offence. The Schengen alert system thus operates through data entered at the request of a domestic judicial authority, but sent by one contracting state to another. To give continuing effect to this system, section 212 of the 2003 Act, as amended by section 68 of the Policing and Crime Act 2009, provided (originally on a temporary, but in the event on a continuing basis) that, where an article 95 alert is issued, then (2) The reference in section 2(2) to an arrest warrant issued by a judicial authority of a category 1 territory is to be read: (a) as if it were a reference to the alert issued at the request of the authority, and (b) as if the alert included any information sent with it which relates to the case. (3) In consequence of subsection (2), this Act has effect with these modifications (a) in sections 2(7) and (8) . for authority which issued the Part 1 warrant substitute authority at the request of which the alert was issued; . The effect of section 212 is thus that sections 2(7) and (8) must, in the context of article 95 Schengen alerts be read: (7) The designated authority may issue a certificate under this section if it believes that the authority at the request of which the alert was issued has the function of issuing arrest warrants in the category 1 territory. (8) A certificate under this section must certify that the authority at the request of which the alert was issued has the function of issuing arrest warrants in the category 1 territory. When certifying under section 212, SOCA must be intended to focus on the question whether the domestic judicial authority at the request of which the data were put on the Schengen system in the overseas state had the function of issuing domestic arrest warrants. This shows, Mr Lewis submits, that the very same words used in their original unmodified form in section 2(7) and (8) must also focus on the function of issuing domestic arrest warrants. In my view, that does not follow. When section 212 is in play, there is only one possible judicial authority in play, that is the overseas judicial authority at whose instance the Schengen alert is entered on the system and which is distinct from the contracting state by which the alert is communicated to the United Kingdom. It is natural that any certificate required should look at the status and functions of that overseas domestic judicial authority. When section 212 is not in play, the directly relevant judicial authority is the authority which issues the European arrest warrant. The status and functions of the authority issuing any domestic warrant (if any) are of subsidiary interest, even though the existence of any such domestic warrant will need to be noted in the European arrest warrant under article 8(1)(c) of the Framework Decision and section 2(4)(b) of the 2003 Act, as decided in Louca [2009] 1 WLR 2550. It is therefore possible for the same phrase to point in different directions in these two different contexts. To treat section 212 as altering what would otherwise be the appropriate meaning to put on section 2(7) and (8) would, in my view, be to treat the tail as wagging the dog. Mr Lewis seeks to rely on Parliamentary material under the principle in Pepper v Hart [1993] AC 593. That involves showing that the provision is ambiguous or obscure and that there are ministerial statements which, viewed in the context of the Parliamentary material as a whole, provide a clear answer as to its meaning. I do not consider that these conditions are met. I doubt whether section 2(7) is even sufficiently ambiguous or obscure to justify looking at Parliamentary material on this point. Assuming that it is, it is true that one finds ministerial statements that European arrest warrants would be issued by precisely the same authorities as currently issued the (necessarily domestic) warrants on the basis of which executive requests were previously made between states for surrender: see eg Mr Ainsworths statements in Standing Committee on 9 January 2003 (Hansard (HC Debates), col. 48), which I quoted in Assange [2012] 2 AC 471, para 253. But immediately afterwards Mr Ainsworth went on to say that By the time that countries start to operate the European arrest warrant, we will know which authorities will be competent to issue them. It will be reasonably straightforward for the issuing authority to be identified and it will be possible to cross check them with the central record kept by the general secretariat and a little later (at col 51) that If the issuing authority were not a judicial authority as designated in the framework document, the body charged with certifying would not accept the warrant. These statements made clear that in the ministers mind certification was linked with the information provided under article 6 of the Framework Decision, which goes to the function of issuing European arrest warrants, not domestic warrants. The upshot is that neither in these nor in any other passages is there the clarity of statement that could assist to put a different meaning on section 2(7) to that which I consider otherwise follows on ordinary principles of construction. In my view, section 2(7) must (other than in the context of Schengen alerts under section 212) be taken as referring, however awkwardly, to the function of issuing European arrest warrants, not domestic. Judicial authority The second ground of challenge to the requests therefore fails, and I turn to consider whether the Ministries can be regarded as judicial authorities for the purposes of issuing the requests in issue on these appeals. The question is whether the concept of judicial authority embraces any category of persons beyond courts, judges, magistrates and (in the light of Assange) public prosecutors, and if so in what circumstances. Mr Knowles argued for a positive answer, relying on all five reasons on which Lord Phillips based his judgment in Assange. But only one of these reasons received any real endorsement even in the other majority judgments in that case: see Lord Walker at para 92. Lord Brown at para 95, Lord Kerr generally and Lord Dyson at paras 155 to 159 and 171. I add only, with regard to the third reason, that I agree with Lord Dyson (para 158) that the removal from the December 2001 Council redraft of the Commissions September 2001 proposal of definitions of judicial authority in terms of a judge or public prosecutor provides no basis for concluding that it was intended to broaden the scope of the concept beyond judge or public prosecutor. It is at least as likely that there were considerable reservations in some member states about appearing to accept a judge or public prosecutor as an appropriate judicial authority for the purposes of both issuing and executing European arrest warrants, as would have been the effect of the definitions included in the September 2001 proposal. Any further conclusion would be speculation. As regards the fourth reason, I also agree with Lord Dyson (para 159) that the assumption in article 6 that there may be a range of judicial authorities from which to chose that which is to be competent to issue European arrest warrants says nothing significant about the scope of the concept of judicial authority. This is all the more so, now that it is decided by Assange that the range can include both courts and public prosecutors. The one ground which did influence most members of the court in Assange was Lord Phillips fifth and final ground, based on applying the principles of the Vienna Convention on the Law of Treaties 1969 to the international agreement reached under Title VI and embodied in the Framework Decision. As appears by the five paragraph coda which appears at the end of the Courts judgment in Assange as published in [2012] 2 AC 471, 569 570, the relevance of the principles in the Vienna Convention was assumed, not argued, in Assange. When, after the draft judgment on the substance was handed down, Miss Rose QC applied to re open the appeal to take issue with the relevance of the Vienna Convention, her application was rejected as being without merit, not because the point she wished now to raise would itself have been meritless, but because it was too late to do so on that appeal. She had had her chance to raise it during the course of oral argument before the hand down, but had accepted that the Vienna Convention applied and that state practice was a potentially relevant aid to construction. On the present appeals, there has been no such acceptance. The applicability of the Vienna Convention and the relevance of state practice have been put squarely in issue. The issue is of potential relevance (though each countrys law and practice may raise different considerations) because, in addition to Lithuania and Estonia, it appears that Finland and Sweden have under article 6 designated bodies operating as part of or under their Ministries of Justice as their issuing judicial authority in the case of conviction warrants in the case of Finland the Criminal Sanctions Agency, in the case of Sweden the National Police Board; and Germany has designated its Ministry of Justice, although stating that its powers have been transferred to the public prosecutor at the relevant regional court. Further, two countries have designated their Ministries of Justice as their issuing authority in the case of accusation warrants Denmark outright, and Germany subject to the same transfer of powers to the regional public prosecutor. The evidence of state practice is thus, on any view, much more limited than that which existed in relation to the use of public prosecutors as recounted in Assange, where it appeared that some 11 states had nominated public prosecutors in the case of accusation warrants and some ten in relation to post conviction warrants. (The information now before the court indicates that these figures were slightly inaccurate, and should have been ten, or pre trial 12, in the case of accusation warrants and eight in the case of conviction warrants.) Nonetheless, Mr Knowles submits that the designation of Ministries of Justice should, even if limited, be regarded as significant, because of the absence of evidence that other states have challenged the designation or refused to execute warrants. Bearing in mind that it is unclear how far any challenge would fall to be raised by executing states, rather than by the persons whose surrender was sought, and that there has been no detailed study of state legislation or practice in cases where it is by implication suggested that a challenge might have been raised, I am unimpressed by the strength of the alleged practice as an indicator of any agreement of the state parties regarding interpretation, within the meaning of article 31(3)(c) of the Vienna Convention. As I noted in Assange, at para 242, the fact that three states (Denmark, Germany and Romania) have also designated their Ministries of Justice as executing judicial authorities is also capable of raising questions about the reliability of state practice as a guide, even if otherwise admissible. As to the question of principle, whether the Vienna Convention is applicable to the Framework Decision, in my view it is unlikely as a matter of European law that it is or would be so regarded. For reasons already indicated in paragraph 23 above, the Framework Decision must be understood in the context of Title VI of the pre Lisbon Treaty on European Union, and the structure of objectives, principles, powers and procedures contained in that Treaty, including, where individual States agreed, provisions relating to the Court of Justices jurisdiction: see eg articles 2 to 6, 29, 31, 35 and 39. So viewed, I do not consider it correct to describe the Framework Decision as a treaty at all. It is a subsidiary measure, which fell to be agreed by unanimity within the scope of the powers conferred by, as well as in accordance with the procedures defined by, the pre Lisbon Treaty on European Union. It must be interpreted as such: see the passages from Edward and Lane cited in paragraph 23 above. Under the pre Lisbon Treaty on European Union, among the important pre conditions to the agreement of the Framework Decision was the express requirement under article 39(1) for the Council to consult the European Parliament upon it as a measure agreed for facilitating extradition within article 34(2)(b). The European Parliament had three months to deliver an opinion upon the measure. Its opinion, delivered on 9 January 2002, approved the measure, but with the request that the Council notify the Parliament should it intend to depart from the approved text. The argument that subsequent state practice by members of the Council could change or affect the meaning of a Framework Decision potentially sidelines the European Parliaments role. For that reason alone, it is not one that I believe that the Court of Justice would be likely to endorse even under the pre Lisbon Treaty on European Union. There is a striking absence in the textbooks and case law of any reference to, or any instance of the application of, subsequent member state practice as establishing the agreement of member states to a particular interpretation, or as having any real relevance to interpretation, of a measure introduced under any of the European Treaties. The court was referred to The Court and the Tribunal of the EC and the Vienna Convention on the Law of Treaties 1969, an article by P J Kuijper (a legal adviser to the Commission), published in Legal Issues of European Integration, (1998) vol 25, issue No 1. The article focuses on references to the Vienna Convention in relation to treaties and secondary legal acts entered into by the Community with third parties. The European Treaties themselves are of a special and different nature, as the article points out with reference to the Court of Justices Opinion 1/91 [1991] ECR I 6079. In that Opinion the court said: 21 In contrast, the EEC Treaty, albeit concluded in the form of an international agreement, none the less constitutes the constitutional charter of a Community based on the rule of law. As the Court of Justice has consistently held, the Community treaties established a new legal order for the benefit of which the states have limited their sovereign rights, in ever wider fields, and the subjects of which comprise not only member states but also their nationals (see, in particular, the judgment in Van Gend en Loos (Case 26/62) [1963] ECR 1). The essential characteristics of the Community legal order which has thus been established are in particular its primacy over the law of the member states and the direct effect of a whole series of provisions which are applicable to their nationals and to the member states themselves. With regard to the possibility that subsequent practice might influence the interpretation of Community law, the article at pp 9 10 states bluntly that: It may be interesting to recall here that, as far as Community law is concerned, and certainly where the provisions of the Community Treaty are concerned, the Court of Justice does not accept arguments of subsequent practice at all. The Court in such cases has recourse to the standard phrase that mere practice cannot change the treaty. Cited in support are French Republic v Commission of the European Communities (Case C 327/91) [1994] ECR I 3641 and the Court of Justices Opinion 1/94 [1994] ECR I 5267. In the former, the issue was the extent of the Commissions powers to conclude agreements with third countries, under article 228 EEC which provided for such agreements to be negotiated by the Commission and concluded by the Council after consulting the Parliament subject to the powers vested in the Commission (reconnues la Commission) in this field. The Commission argued that its powers might be derived from previous practice of the respective Community institutions, to which the Court observed (para 36) that a mere practice cannot override the provisions of the Treaty. Likewise, the court held in United Kingdom of Great Britain and Northern Ireland v Council of the European Communities (Case 68/86) ECR 855, para 24, and reiterated in its Opinion 1/94 [1994] ECR I 5267 in relation to suggested external competence in the field of GATs (the General Agreement on Trade in Services) that a mere practice of the Council cannot derogate from the rules laid down in the Treaty and cannot, therefore, create a precedent binding on Community institutions with regard to the correct legal basis (para 52), that, it would, in the field of TRIPs (trade related aspects of intellectual property rights), enable the Community institutions to escape the internal constraints to which they are subject in relation to procedures and to rules as to voting (para 60) and that Institutional practice in relation to autonomous measures or external agreements adopted on the basis of article 113 cannot alter this conclusion (para 61). These statements, made in the context of arguments about institutional competence under the Treaties themselves, are a strong indicator of the attitude that the court would take to any suggestion that the member states could by agreement between themselves alter or influence the meaning of Community measures arrived at under the Treaties, following procedures for their negotiation and enactment, including consultation with the European Parliament, contained in such Treaties. The only case which the Ministries have been able to locate in which the court might be said to have taken account of member state practice in interpreting a Community instrument under any of the European Treaties is Skatteministeriet v Henriksen (Case 173/88) [1989] ECR 2763. There, after giving its reasons for a particular construction, the court added a paragraph saying: That interpretation is also in conformity with the view common to all the member states, none of which has adopted legislation [consistent with the interpretation which the court rejected] (para 13) That comment, in a case where member states view or practice was consistent with that at which the court had arrived, is wholly inapt to show that such practice is capable of changing the meaning of an autonomous European concept in a Community or Union instrument agreed under the Treaties. I can therefore put aside the suggestion that member states alleged practice can affect the question whether the Ministries are capable of being designated as judicial authorities for the purpose of issuing European arrest warrants under the Framework Decision. Equally, however, the interpretation of the Framework Decision cannot, as it seems to me, be influenced by comments made in some evaluation reports to the effect that Ministries of Justice are not judicial authorities: see eg Council Evaluation Report on Lithuania 12399/1/07, para 7.2.1.1, reporting that The Lithuanian authorities recognised that EAWs should be issued by judicial authorities and that the Ministry of Justice could not be considered a judicial authority; and the Commission report on the operation of the Framework Decision COM(207) 407, commenting in relation to both Lithuania and Estonia that the Ministry of Justice is not a judicial authority. In my opinion, the concept of judicial authority falls simply to be interpreted in the teleological and contextual manner that Professor Anthony Arnull indicates in The European Union and its Court of Justice, 2nd ed (2006), pp. 612 and 621, as I stated in paragraph 229 of my judgment in Assange [2012] 2 AC 471. In the context of the Framework Decision, the most obvious purpose of insisting on the concept was to ensure objectivity (including freedom from political or executive influence) in decision making and to enhance confidence in a system which was going to lead to a new level of mutual cooperation including the surrender of member states own nationals to other member states. The special emphasis in recital 6 on the importance of this concept in the context of execution of European arrest warrants indicates a possible difference between its significance in the contexts of issuing and executing a European arrest warrant. Likewise, article 19 with its distinction between the competent executing judicial authority and another judicial authority which may need to be involved at the hearing stage in order to ensure the proper application of this article and of the conditions laid down. This leads to consideration of the features which an authority must as a minimum have, if it is to be regarded as an issuing judicial authority for the purposes of the Framework Decision. Mr Lewis, submits that they are three: (i) it must be functionally independent of the executive, (ii) it must be capable of making a judicial decision and (iii) it must be separate from the designated central authority, a separation assumed by recital 9 and article 7. In Assange, at para 153, Lord Dyson was inclined to think that the essential characteristics of an issuing judicial authority are that it should be functionally (but not necessarily institutionally) independent of the executive. In the Administrative Court in the present cases, Aikens LJ considered that a ministry of justice could be an issuing judicial authority for a conviction warrant if the person in the ministry making the decision was sufficiently independent of the executive for the purposes of making that judicial decision and thought, in this connection, that there was much force in Lord Phillips point [in Assange [2012] 2 AC 471, paras 62 64] about the requisite safeguards being predominantly in the antecedent process which forms the basis on which the conviction European arrest warrant is issued (para 98). I would make three points in relation to these observations. First, Assange was a case of an accusation warrant and Lord Dyson noted at paras 156 157 the difficulty about Lord Phillips point, which constituted his second reason in Assange (see paras 62 64): there is no guarantee that a domestic accusation warrant would be based on any judicial decision at all, and the implications of a European arrest warrant are likely to be more serious than those of a domestic arrest warrant. Second, a test which would mean seeking to ascertain whether one or more individual decision makers within a ministry was or were functionally, even though not institutionally, independent of the ministry in which they served, may be regarded as problematic, both in principle and because of the evidential issues to which it could give rise. On no view, in any event, would the Minister of Justice signing on behalf of the Ministry of Justice of Lithuania appear to satisfy any such test. I need say no more than that on these appeals. Third, Aikens LJ must I think have had this point in mind when he went on, immediately after his above quoted observations, to focus his conclusions on the need for a prior court request that a European arrest warrant should be issued, and on the consequent restriction of any positive ministry role to determining that effect be given to such a request: If the national law concerned provides that the pre condition to the issue of a conviction EAW by the ministry of justice is that there must be not only an enforceable judgment and sentence but also a request from the sentencing court that a conviction EAW be issued, then the scope for executive interference is much reduced if not entirely eliminated. (para 98) This postulates a situation in which the ministrys decision to issue a conviction European arrest warrant has by law to be and is firmly founded on a judicial decision by the responsible court that such a warrant is appropriate. Consistently with this approach, both Ministries of Justice sought in their submissions and evidence to meet the criteria suggested by Aikens LJ. Accusation and conviction warrants do not necessarily raise the same considerations. A conviction warrant must necessarily have been preceded by a domestic court process. There is less scope for discretion in relation to the issue of a European arrest warrant following from a conviction. If the court responsible for the conviction or execution of the sentence considers that the European arrest warrant should be sought, and the issue of such a warrant follows from its decision, then the issue of the warrant can be regarded as the result of a judicial decision, even though the issue takes place by and in the name of a different authority. The key question is whether the issuing authority can in such a case be regarded as a judicial authority for the purposes of the Framework Decision or 2003 Act, when it is, as here, the Ministry of Justice or a section within that Ministry. Mr Lewis and Mr Jones submit that it cannot, on the basis that a body, which cannot act of its own initiative and which simply box ticks, cannot be a judicial authority taking a judicial decision. They also point out that the two Ministries have also been designated as their respective countries central authorities for the purposes of article 7, in circumstances where both recital 9 and article 7 contemplate that such a body will be separate from and have a limited role in proving practical and administrative assistance to the competent judicial authorities. Before going further into these questions, it is however relevant to look more closely at the evidence and facts in the cases under appeal. The evidential material The Administrative Court proceeded on the basis that the two requests made by the Ministry of Justice of Lithuania were based in each case upon a request made by a court, not by a prison or the Prison Department; the functions of the officials of the Ministry were tightly defined by the Rules and the decision on whether to issue the conviction European arrest warrant has to be made on the basis of those Rules alone (para 104). The warrants, though signed for the Ministry by the Minister of Justice, were on this basis regarded as issued by a judicial authority. In relation to the procedure in Estonia there was, however, much less material before the Administrative Court; there appeared to be no requirement that the sentencing court must prepare a draft European arrest warrant and then request the ministry to issue the European arrest warrant and no procedural rules which dictate what the ministry officials have to do or which dictate the time in which a request to issue a conviction warrant be carried out. The court was not satisfied that the Ministry of Justice of Estonias decision to issue a European arrest warrant could be regarded as judicial or that the International Judicial Cooperation Unit within that Ministry and its personnel had sufficient functional independence from the executive to enable the Ministry to be characterised as a judicial authority for the relevant purposes (para 106). Before the Supreme Court further material has been produced, in relation to both the Lithuanian and the Estonian positions. Mr Lewis referred to and relied upon the Lithuanian material as did eventually Mr Jones, after initially objecting to its admission. I for my part consider that the new material should be admitted and considered, even though it should have been before the Administrative Court. Without it, it is clear that we would be at risk of deciding these appeals on a false basis. The Lithuanian position The picture which emerges in relation to Lithuania from communications to the Crown Prosecution Service by the Vice Minister of Justice is that the Ministry only issues any European arrest warrant after conviction on the initiative of either (a) a court or (b) an authority responsible for executing the sentence. It does so then after examination of all the documents to ascertain that valid grounds exist for issuing such a warrant. In this connection, article 69 of the Code of Criminal Procedure provides: 2. European arrest warrants regarding citizens of the Republic of Lithuania or other persons who have been sentenced to imprisonment by enforceable judgments in the Republic of Lithuania and who have absconded from serving the sentence in another member state of the European Union shall be issued and competent authorities of that state shall be contacted by the Ministry of Justice of the Republic of Lithuania. 3. The procedure for issuing a European arrest warrant and surrendering the person under the European arrest warrant shall be defined by the Prosecutor General of the Republic of Lithuania and by the Minister of Justice of the Republic of Lithuania. Under article 69(3), the following Rules for issuing European arrest warrant were duly promulgated by Order no. IR 95/I 114 of 26 August 2004. They provide: I. GENERAL PROVISIONS 4. The Ministry of Justice of the Republic of Lithuania shall issue the European arrest warrant with a view to arrest a person who has been punished by custodial sentence but who has gone into hiding from the enforcement of this sentence. In this case the European arrest warrant shall be issued under the following circumstances: 4.1. when the remainder of the sentence to be served is of four months or of longer term; 4.2. when there is a ground to believe that the convicted person may be located in the member state of the European Union or other State, which applies the surrender procedure of the persons concerned pursuant to the European Arrest Warrant. RECOURSE FOR WARRANT 7. If the case has been heard in the trial and the judgement of conviction rendered in absentia of the accused, the court shall send a copy of the enforceable judgement of conviction whereby a sentence of imprisonment has been imposed together with the draft European arrest warrant (except section (i)) to the Ministry of Justice of the Republic of Lithuania after taking into consideration the criteria for ISSUING EUROPEAN ARREST issuing a European arrest warrant laid down in paragraph 12 of the Rules. 8. If the convicted person, who has not been arrested until the court judgement became enforceable, absconds from the execution of the custodial sentence imposed on him by the court's judgment, or if the convicted person while serving his custodial sentence runs away from the correctional institution or fails to return there, the request to issue the European arrest warrant shall be submitted to the Ministry of Justice by the institution executing the sentence after taking into consideration the criteria for issuing a European arrest warrant laid down in paragraph 12 of the Rules. A copy of the enforceable judgement of conviction whereby a sentence of imprisonment has been imposed and the draft European arrest warrant (except section (i)) shall be enclosed with the request. 9. When the court renders a Ruling to quash the suspension of the sentence execution, a Ruling to quash either a conditional early release from custodial sentence or conversion of the remainder of the sentence into a more lenient punishment or a Ruling to refer the person released conditionally from the correctional institution to serve the remaining sentence of imprisonment in the correctional institution, the court shall forward a copy of the aforesaid Ruling together with the draft European arrest warrant (except section (i)) to the Ministry of Justice of the Republic of Lithuania after taking into consideration the criteria for issuing a European arrest warrant laid down in paragraph 12 of the Rules. III. ISSUING OF THE EUROPEAN ARREST WARRANT 12. Upon receiving the documents set out in Chapter II of these Rules, the Prosecutor General's Office of the Republic of Lithuanian or the Ministry of Justice of the Republic of Lithuania shall analyse the above documents and, if there are all preconditions listed in paragraphs 3 or 4 of the Rules, shall issue the European arrest warrant taking into consideration the severity and type of the offence committed and the suspected, accused or convicted person's personality. If the information is insufficient to issue the European arrest warrant, the Prosecutor General's Office of the Republic of Lithuania or the Ministry of Justice of the Republic of Lithuania shall contact the institution, which has requested to issue the European arrest warrant, asking to provide the missing information within the time limit specified by the Prosecutor General's Office of the Republic of Lithuania or the Ministry of Justice of the Republic of Lithuania. If there are no grounds for issuing the European arrest warrant or the missing information is not obtained during the time limit defined, or if the issuance of the European arrest warrant does not satisfy the principles of proportionality and procedural economy, the request to issue the European arrest warrant shall be returned to the requesting institution. 13. The European arrest warrant shall be issued not later than within 5 days after receiving all information necessary for preparing the European arrest warrant. 14. The European arrest warrant shall be prepared in accordance with the form contained in the Annex 1 of these Rules. 16. if the European arrest warrant is issued by the Ministry of Justice of the Republic of Lithuania, then it shall be undersigned by the Minister of Justice of the Republic of Lithuania or his delegated persons. Contrary to the Administrative Courts understanding, it is now clear (from the Ministry of Justices letter dated 5 November 2012) that, while the request made to the Ministry of Justice in respect of Bucnys, came under rule 9 from the Vilnius City 1st District Court after it had on 20 February 2010 quashed Bucnyss conditional release, the request in respect of Sakalis came from the Prison Department of the Republic under rule 8, based on its assessment that Sakalis had absconded from the whole of the four year sentence imposed by the Vilnius City 1st District Court on 25 January 2008 and upheld on appeal on 24 December 2008. The Vice Minister of Justice of Lithuania has explained in correspondence put before the Supreme Court that the prison department would only act after being provided by the Vilnius City 1st District Court with relevant documentation regarding the conviction and sentence. It does not follow that the District Court made any sort of judicial decision at this point and the evidence does not show that it did. Both in law and in practice, the responsibility for requesting the Ministry of Justice to issue a European arrest warrant rested on the prison authorities, upon which rule 8 conferred it. In these circumstances, I cannot regard the European arrest warrant issued in respect of Sakalis as having been either issued by a judicial authority or as being the result of a judicial decision. The Prison Department is an executive agency charged, as rule 8 states, with the execution of the sentence. It is not a judicial body considering and ruling upon the question whether the person wanted has absconded. The language of rules 8 and 12, read together, makes it possible (though surprising) that the Prison Department is required before submitting a request to issue a European arrest warrant to the Ministry to take into consideration the severity and type of the offence committed and the . convicted persons personality. In other words, it may have a discretion. If so, the evident oddity in the context of a European arrest warrant of such a discretion being entrusted to a prison department merely underlines the fact that it cannot be regarded as a judicial authority. The Ministry of Justice after receiving the Prison Department request is under rule 12 required not only to consider for itself whether the formal pre conditions listed in rule 4 are satisfied but (it appears) also to take into consideration the severity and type of the offence and the . convicted persons personality. Assuming again that this connotes an element of discretion, even in the case of a conviction, as to whether it issues a warrant, the mere fact that the Ministry of Justice is given a discretion does not make it a judicial body. If anything, it points once again towards a need for a judicial decision by a body or bodies which could be regarded as judicial. I would therefore allow the appeal by Sakalis and set aside the Part 1 warrant issued in respect of him. The position in relation to Bucnys is different. Under the combination of rules 9 and 12, the Vilnius City 1st District Court not only took the decision to quash his conditional release on 12 September 2008, it also forwarded copies of its ruling to the Minister with a draft European arrest warrant, and it must be taken to have done this after taking into account the criteria for issuing such a warrant laid down in rule 12, including the severity and type of the offence and the . convicted persons personality. The Ministry of Justices only role was to repeat the same exercise. Its review could not worsen the position of the convicted person. At best, if the Ministry took a different view on the question whether the criteria were met, its review might lead to a decision not to issue a European arrest warrant which the Vilnius court had adjudged to be appropriate. Essentially, therefore, the European arrest warrant issued in respect of Bucnys emanated from the court responsible for him having to serve a further period in prison. That was a judicial decision by a judicial authority. The Ministry by issuing the warrant effectively endorsed that decision. Under article 7 of the Framework Decision, it would have been permissible for Lithuania to designate the Vilnius City 1st District Court as the relevant judicial authority and to restrict the Ministrys role to its capacity of central authority. If a court were to out source its registry and the registry were to be designated as the judicial authority responsible for issuing warrants or other orders to give effect to the courts orders, it should I think be possible to regard the registry as a judicial authority issuing a judicial decision, even though or because it would simply be giving effect to the courts orders. In the present case, it appears that the Ministry of Justice had some discretion, but only in the sense of a one way discretion to check that, in its view also, a European arrest warrant was appropriate. This requirement for two concurrent decisions in favour of such a warrant could only operate to the benefit of the person whose surrender was proposed by the court responsible for the conviction or sentence. In these circumstances, I consider that European law would accept that the spirit of the Framework Decision was met in the case of European arrest conviction warrants issued by the Ministry of Justice of Lithuania to give effect to a corresponding request by the Court responsible for the sentence, and would treat the Ministry of Justice in that context as an appropriate issuing judicial authority. I have been addressing the present situation of a Ministry of Justice acting at the request of the responsible court. It is possible that the spirit of the Framework Decision may also be satisfied in some other situations, for example when a Ministry of Justice acts on the basis of a request made by a public prosecutor, held by this court in Assange to be capable of being regarded as a judicial authority. To take a specific instance, in Germany the Ministry of Justice is designated as the relevant judicial authority for the purpose of issuing conviction (and indeed also accusation) European arrest warrants, but has in some way transferred or delegated its role to the public prosecutor at the relevant regional court. As we have no details of the arrangements or how they operate, I can express no conclusion either way, but it may prove appropriate to treat the Federal Ministry of Justice as the issuing judicial authority, when a German public prosecutors decision that a conviction European arrest warrant should be issued is simply endorsed by or leads to the issue of such a warrant in the name of the Ministry. The Estonian position Turning to the position of the European arrest warrant issued by the Head of the International Cooperation Unit of the Estonian Ministry of Justice, it is now known that the Viru County Court on 10 February 2011, on learning that Lavrov was living in the United Kingdom, sent a request to the Ministry of Justice to issue a warrant to give effect to the domestic arrest warrant that it had itself issued on 9 February 2010. There is also substantial further information about the Estonian legal position in the form of answers dated 28 February 2013 to a questionnaire submitted by the Crown Prosecution Service. The legal framework is contained in article 507 of the Code of Criminal Procedure of Estonia which reads: Submission of European arrest warrant (1) In pre trial proceedings, the Prosecutor's Office and, in court proceedings, the court which conducts proceedings regarding a criminal offence which is the basis for a European arrest warrant is competent to submit the European arrest warrant. (2) The Ministry of Justice is competent to submit a European arrest warrant for the execution of a court judgment which has entered into force. (21) In pre trial proceedings, a preliminary investigation judge may, at the request of the Prosecutor's Office, apply arrest for surrender before preparation of a European arrest warrant. (22) If surrender of a person is requested in court proceedings, the arrest for surrender of the person shall be applied by the court which conducts proceedings regarding the criminal offence. (3) A European arrest warrant shall be prepared in Estonian and it shall be translated into the language determined by the requesting state by the Ministry of Justice. (4) A European arrest warrant shall be communicated to a requesting state through the Ministry of Justice. (5) In cases of urgency, a request for application of arrest for surrender with regard to a person to be surrendered may be submitted to a member state of the European Union through the International Criminal Police Organisation (Interpol) or the central authority responsible for the national section of the Schengen Information System with the consent of the Prosecutor's Office before a European arrest warrant is submitted. In the case of Lavrov, articles 507(2) and 507(22) both applied. The Deputy Secretary General of the Ministry of Justice explained by letter dated 28 February 2013: The court ruling declaring the person a wanted and applying arrest on sight towards him or her is the prerequisite for later issuance of a European arrest warrant. No European arrest warrant can be issued without a court first declaring the person a wanted and applying arrest on sight (domestic arrest warrant) towards him or her. Pursuant to section 507 (21) and (22) of the Estonian Code of Criminal Procedure, applying arrest for surrender is a prerequisite for issuing an European arrest warrant. If no arrest pending surrender has been applied towards the person, then an European arrest warrant cannot be issued. This letter gives the following further information: in this current case a court requested the Ministry of Justice to issue a European arrest warrant on the basis of court decisions entered into force. The issuance of an European arrest warrant in conviction cases by the Estonian Ministry of Justice only takes place upon request by the court who made the decision in the specific case or a court that has the competence to issue the arrest warrant and to declare the person a fugitive in cases where the person was convicted by conditional sentence and the person escaped from the execution of sentence or the person was in freedom during the court procedures but has to appear to prison on a specific date and time to start the service of his/her sentence. Thus, this is the court that sends to the Ministry of Justice the judgment or ruling with request to issue the European arrest warrant. The court's decision has to be either a final and enforceable judgment satisfying the requirements of the framework decision or a domestic arrest warrant stating that the detention conditions are met. The only restrictions that the Ministry of Justice is obliged to follow upon issuing a European arrest warrant on a court's request, are the general restrictions on issuing of European arrest warrants from [the] Framework Decision ie the requirement that the punishment of imprisonment applicable to a crime for which the person has been convicted must be longer than four months of imprisonment. If the materials sent to the Ministry of Justice for issuance of an European arrest warrant regarding a person towards whom the court has applied arrest for surrender, indicate that the actual punishment imposed on the person or actually servable part thereof is less than four months, then the Ministry of Justice may inform the court that there are no legal grounds for issuing an EAW. In other cases the court's request to issue a specific EAW is compulsory for the Ministry of Justice. The same letter also addresses the possibility that a European arrest warrant might be issued under executive influence: The Judicial Co operation Unit is one of the structural units of the Ministry of Justice, but it is independent in its decisions and bases its actions solely on the law and the international instruments. This independence is also expressed in the fact that all documents prepared by the unit, ie both European arrest warrants and MLA [mutual legal assistance] requests for judicial assistance are undersigned by the head of unit or the advisor who prepared the letter. All materials, ie requests from courts, materials of the prosecutor's office, and also judicial co operation materials and requests for legal assistance received from abroad are forwarded from the Ministry's office directly to the Judicial Co operation Unit without passing through the Minister, the Secretary General or the Deputy Secretary General. Therefore the executive has no information about whether, how much or which judicial co operation materials are being preceded by the unit at any time. There has been no intervention by the executive in the unit's work and there cannot be any intervention of that kind because communication in the field of international law is very strictly regulated by domestic legislation and by various other legal acts, so it is unthinkable that the Minister or the Secretary General could order the issuance of some request for legal assistance without the initiative of a prosecutor's office or a court. International judicial co operation is very strictly and precisely regulated by various international conventions and treaties which prescribe also the role and competence of Ministries of Justice as central authorities. It is unthinkable that the Ministry of Justice could exceed its limits of competence by way of its executive ordering a request for legal assistance for which the Ministry of Justice has competence. It is also unthinkable that the executive of the Ministry of Justice could order that a request for legal assistance be not issued or not forwarded. As described above, in daily work the management has no information at all about the requests that are preceded [sic] by the Unit at any given time. Furthermore, the Public Service Act of the Republic of Estonia prohibits (article 62) unlawful orders from the executive and gives the ways how to react in such situations. On the basis of this detailed description of the legal, procedural and practical position, it is clear that the real decision is taken by the court responsible for the conviction and sentence, and the Judicial Cooperation Unit of the Ministry of Justices only lawful role is to check that the formal conditions for issue of a European arrest warrant are satisfied, and, if they are, to issue the warrant. On the basis, by parallel reasoning to that which I have indicated in relation to Bucnys, I consider that the Ministry can be regarded as a judicial authority issuing a warrant containing a judicial decision, albeit one taken in reality by the responsible court, here the Viru County Court. However, Mr Jones points to other information in the form of the Council Evaluation Report on Estonia 5301/07 dated 20 February 2007, which states: 3.1. THE DECISION TO ISSUE The Estonian authorities do not have a formal practice guide concerning the instigation of European arrest warrant proceedings or the subsequent steps to be taken. Standardised European arrest warrant practices have been outlined to all European arrest warrant stakeholders during training provision supplied by the CA together with professional trainers from the Estonian Law Centre. It states that, in the case of accusation warrants, the following factors will be taken into consideration by a review made before any decision to issue a European arrest warrant: severity of the offence, degree of participation, extent of the injury/damage. It continues: In cases concerning the enforcement of a sentence, officials within the CA will apply similar merit tests to assess the appropriateness of the application. They will then obtain, directly from the criminal court concerned, a copy of the order to be enforced and proceed to draft an European arrest warrant. In real terms therefore a pragmatic de minimis test is brought to bear, balancing the seriousness of the criminality against the merits (costs or otherwise) of issuing an European arrest warrant. Estonia reported that their outgoing European arrest warrants were all of a benchmarked standard. This second hand account of the Estonian system does not bear much relationship with that given by the Ministry of Justice itself in 2012 and 2013. It makes no reference to the provisions of article 507 of the Code of Criminal Procedure, or to any role of the court responsible for the conviction, still less to any duty on the part of the Ministry to issue a European arrest warrant, once satisfied that the formal conditions are met. Although the report points out earlier that the Ministry of Justice has been designated both as the competent judicial authority and as the central authority in relation to the issue of European arrest conviction warrants, it speaks at this point only of the CA. The report was based on a visit by experts to Estonia in September 2006, little over two years after Estonia joined the European Union on 1 May 2004. The European arrest warrant system may not have been well digested by that date. The Code of Criminal Procedure may have been amended since 2006 it seems clear that article 507(21) 2 and (2) must have been added at some point. However, even if, contrary to the Ministrys emphatic explanation, the Judicial Cooperation Unit of the Ministry does enjoy some form of proportionality discretion, when it comes to the exercise of a European arrest warrant requested by a court responsible for a sentence, this is again a factor which can only weigh in favour of the person whose surrender is sought. It does not therefore mean, in my opinion, that the Ministry in issuing the European arrest warrant in respect of Lavrov should not be regarded as a judicial authority communicating a judicial decision made by the Viru County Court. Conclusions The conclusions of principle that I reach are: For the purposes of Council Framework Decision 2002/584/JHA and Part 1 of the Extradition Act 2003: i) A European arrest warrant issued by a Ministry in respect of a convicted person with a view to his or her arrest and extradition can be regarded as issued by a judicial authority for the purposes of Council Framework Decision 2002/584/JHA and Part 1 of the Extradition Act 2003 if the Ministry only issues the warrant at the request of, and by way of endorsement of a decision that the issue of such a warrant is appropriate made by: a) the court responsible for the sentence; or some other person or body properly regarded as a judicial b) authority responsible for its execution (see para 57 above). ii) If this condition is satisfied, the existence of a discretion on the part of the Ministry not to issue a European arrest warrant which the responsible court (or other judicial authority) has decided appropriate and requested it to issue does not affect this. iii) Subject only to the second point in para 47 above (so far as left open), a Ministry which has power to issue and issues a European arrest warrant of its own motion or at the request of non judicial authority, including an executive agency such as a prison department, cannot be regarded as a judicial authority for the above purposes. i) The European arrest warrant issued in respect of Bucnys by the Ministry of Justice of Lithuania at the request of the Vilnius City 1st District Court was a valid Part I warrant under the 2003 Act, and Bucnyss appeal should accordingly be dismissed. ii) The European arrest warrant issued in respect of Sakalis by the same Ministry of Justice at the request of the Prison Department was not a valid Part 1 warrant, and Sakaliss appeal should accordingly be allowed. iii) The European arrest warrant issued in respect of Lavrov by the Ministry of Justice of Estonia at the request of the Viru County Court was a valid Part I warrant, and the Ministry of Justice of Estonias appeal in the case of Lavrov should accordingly be allowed. The conclusions I reach on these appeals are that:

These three appeals concern requests for extradition under European arrest warrants (EAWs). The Lithuanian Ministry of Justice issued EAWs for Mindaugas Bucnys based on convictions for housebreaking and fraud and for Marius Sakalis based on his conviction for sexual assaults. The Estonian Ministry of Justice issued an EAW for Mr Dimitri Lavrov based on a conviction for murder. EAWs are warrants intended to meet the requirements of Council Framework Decision 2002/584/JHA on surrender procedures between member states of the EU (the Framework Decision). Within the United Kingdom, Part 1 of the Extradition Act 2003 (the 2003 Act) was enacted to give effect to the same requirements. Under section 2(7) of the 2003 Act the requests were, after receipt in this country, certified by the Serious Organised Crime Agency (SOCA) (now the National Crime Agency (NCA), the designated authority under section 2(8), as Part 1 warrants issued by a judicial authority of a category 1 territory having the function of issuing arrest warrants. The questions of principle raised by the present appeals are whether the requests are open to challenge on the basis that (i) they were not the product of a judicial decision by a judicial authority within the terms of the Framework Decision and/or of Part 1 of the United Kingdom Extradition Act 2003, and (ii) the ministries making them did not have the function of issuing domestic arrest warrants and were incorrectly certified by SOCA under section 2(7) of the 2003 Act. If a challenge is open on either or both of these bases, the third question is (iii) whether the challenge is on the evidence well founded in the case of either or both of the Ministries. On 12 December 2012, the Divisional Court answered the first question affirmatively and the second negatively. As to the third, it concluded that a ministry of justice would, under European law, be regarded as a judicial authority for the purposes of issuing a conviction warrant if it was sufficiently independent of the executive for the purposes of making that judicial decision (para 98), and that, in this connection, the antecedent process, in the form of a request for the issue of a European arrest warrant coming from the court responsible for the conviction, was relevant. On the evidence before it, it held that the EAWs issued by the Lithuanian Ministry in respect of Mr Bucnys and Mr Sakalis were valid, while the EAW issued by the Estonian Ministry in respect of Mr Lavrov was invalid. Mr Bucnys and Mr Sakalis now appeal, while the Estonian Ministry appeals in the case of Mr Lavrov. During the appeal further evidence was adduced about the legal position and procedures in Lithuania and Estonia. Since the hearing, the Court has been informed by those instructed by Mr Bucnys that he has [regrettably] died. The issue remains of importance, and this judgment records the Courts conclusions on it. The Supreme Court unanimously holds that the arrest warrants issued for Mr Bucnys and Mr Lavrov were valid, whereas that issued for Mr Sakalis was not. Mr Bucnyss appeal is therefore dismissed. Mr Sakaliss appeal and the Estonian Ministrys appeal in Mr Lavrovs case are allowed. Whether a justice ministry can be a judicial authority Mr Bucnys, Mr Sakalis and Mr Lavrov submitted that the relevant ministries of justice could not be a judicial authority because they were not part of the courts or judiciary as ordinarily understood. The Supreme Court, in a judgment given by Lord Mance with which all other Justices agree, holds that member states were not intended to have carte blanche to define judicial authority however they choose. The concept is embedded in European Union law. The Framework Decision is based on article 31(1)(a) of the former Treaty of European Union, which itself distinguishes between ministries and judicial authorities [23]. The concept falls under EU law to be interpreted by looking at the instruments context and intended effects [45]. In the context of the Framework Decision, the most obvious purpose of insisting on the concept was to ensure objectivity (including freedom from political or executive influence) in decision making and to enhance confidence in a system which was going to lead to a new level of mutual cooperation including the surrender of member states own nationals to other member states [45]. An EAW issued by a ministry for a convicted person with a view to his or her surrender can be regarded as issued by a judicial authority if the ministry under the relevant national law issues the warrant at the request of, and by way of endorsement of a decision that the issue of such a warrant is appropriate made by, the court responsible for the sentence or by some other person or body properly regarded as a judicial authority responsible for its execution [66]. If this condition is satisfied, the existence of a discretion on the part of the ministry not to issue a EAW which the responsible court (or other judicial authority) has decided appropriate and requested it to issue does not affect this [66]. That could work only in favour of the person sought by the warrant and would be in the spirit of the Framework Decision [56]. In issuing the EAWs for the arrest of Mr Bucnys and Mr Lavrov, the respective ministries acted only at the request of and by way of endorsement of a decision made by a court responsible for the sentence. These two EAWs therefore satisfied the above test [66] and are valid. However, in issuing the EAW for Mr Sakaliss arrest, the Lithuanian ministry was acting only on a request from the prison service, and this EAW did not meet the above test and is invalid [67]. The certification of the requests Mr Bucnys, Mr Sakalis and Mr Lavrov also submitted that the terms of section 2(7) of the 2003 Act meant that a ministry of justice could be certified by SOCA only if it was responsible for issuing domestic arrest warrants rather than European ones. While that was not inconsistent with the bare language of the Act, such an interpretation would involve SOCA in onerous investigations of overseas practice and may have perverse results where, for example, the European warrants with which Part 1 is concerned were issued by a different, but more senior, judicial authority than the domestic ones [26 28]. The correct interpretation was that section 2(7) referred to the authority responsible for issuing European arrest warrants [33]. The warrants and certification were thus unobjectionable in that respect.

8k-16k

This appeal offers an opportunity for this court to consider, for the first time, the extent to which the right to the free use of sporting and recreational facilities provided in a country club environment may be conferred upon the owners and occupiers of an adjacent timeshare complex by the use of freehold easements. In the well known leading case of In re Ellenborough Park [1956] Ch 131 the Court of Appeal decided that the shared recreational use of a communal private garden could be conferred upon the owners of townhouses built around and near it by means of easements. The use of the same conveyancing technique in the present case in relation to a much wider range of activities was, if not misguided, at least a more ambitious undertaking. The essential question, if that case was rightly decided, is whether the same underlying principles work in the present context (as the trial judge and the Court of Appeal both held) or whether the attempt to do so falls foul of the necessary limitations upon the scope of easements in English law, most of which, as recently as 2011, the Law Commission has advised should not lightly be put aside. The essence of an easement is that it is a species of property right, appurtenant to land, which confers rights over neighbouring land. The two parcels of land are traditionally, and helpfully, called the dominant tenement and the servient tenement. The effect of the rights being proprietary in nature is that they run with the land both for the benefit of the successive owners of the dominant tenement, and by way of burden upon the successive owners of the servient tenement. By contrast merely personal rights do not generally have those characteristics. Although owing much to the Roman law doctrine of servitudes, easements have in English law acquired an independent jurisprudence of their own, the essentials of which have been settled for many years, even if the uses of land during the same period have not stood still. Since the question whether a particular grant of, or claim to, rights is capable of having the enduring proprietary quality of an easement is usually (as here) fact intensive, it is convenient to begin with a summary of them. The Facts Broome Park, formerly the home of Field Marshal Lord Kitchener of Khartoum, is a substantial country estate near Canterbury, with a large 17th century Grade I listed house (the Mansion House) at its heart, and a much smaller house, Elham House, nearby. Prior to 1967 Broome Park had been in common ownership. In early 1967 Elham House together with land around it lying entirely within the Park was conveyed off and its separate title was first registered on 30 March 1967. I shall call the house and its surrounding land Elham House. It is the alleged dominant tenement in relation to the disputed easement. I will refer to the rest of Broome Park, retained by the vendor in 1967, including the Mansion House, as the Park. It is the alleged servient tenement in relation to the disputed easement. In or before 1979 the Park was acquired by Gulf Investments Ltd (Gulf Investments), a subsidiary of Gulf Shipping Lines Ltd (Gulf Shipping), for the purposes of developing a timeshare and leisure complex. The essential features of the development scheme included, first, the creation of 18 timeshare apartments on the upper two floors of the Mansion House; secondly, the creation of a communal club house for the timeshare owners and other paying members of the public on the ground floor and basement of the Mansion House including restaurant, TV, billiards and gymnasium facilities; and thirdly, the construction and laying out within the surrounding grounds of the Park of sporting and recreational facilities including an 18 hole golf course, an outdoor heated swimming pool, tennis and squash courts, and formal gardens. Individual purchasers of timeshare units within the apartments on the upper floors of the Mansion House formed themselves into the Broome Park Owners Club (the BPOC). On 13 August 1980, Gulf Investments granted a 35 year lease of the first and second floors of the Mansion House to Gulf Leisure Developments Ltd, which was to hold the residential accommodation within the Mansion House on behalf of the BPOC. I will call it the BPOC Lease. It was drafted so as to confer upon owners of the timeshare units within the Mansion House the free use of the communal and leisure facilities within the lower part of the Mansion House and its surrounding grounds, including the golf course and other sporting and recreational facilities, for the full 35 year of the term, and Gulf Investments covenanted as landlord to keep properly maintained repaired constructed and reconstructed the ground floor and basement of the Mansion House and the sporting and recreational facilities provided within the Park, including the swimming pool, golf course, squash courts, tennis courts and formal gardens. The solicitor responsible for the conveyancing in connection with the development gave evidence at trial that a leasehold structure was chosen for this purpose because of the need to make appropriate provision for what might prove to be the large repairing and maintenance obligations arising from the status of the Mansion House as a Grade I listed building of some antiquity. The early success of this development, centred on the Mansion House timeshare apartments, led Gulf Investments to plan a second timeshare development, this time centred upon Elham House. For that purpose, Elham House was re acquired so as to be integrated within Broome Park in November 1980, and planning permission was obtained for the conversion of the house into two timeshare apartments, and for the building of 24 further timeshare apartments in its grounds, the whole to be re named Regency Villas. It is evident from contemporary marketing materials that a main attraction held out to prospective buyers of timeshare units within the Regency Villas development was the same free use of the sporting and recreational facilities within the ground floor and basement of the Mansion House and within the Park, as had been afforded to the owners of timeshare units on the upper two floors of the Mansion House. On this occasion however, it was decided to use a freehold rather than leasehold structure for Regency Villas, apparently because it was not anticipated that Elham House or the newly built apartments in its grounds would give rise to the potentially onerous repairing obligations associated with the Mansion House. Thus, by a transfer dated 11 November 1981 (the 1981 Transfer) Gulf Investments transferred Elham House to Elham House Developments Ltd, another member of the Gulf Group headed by Gulf Shipping. On the following day, and as part of a pre planned series of transactions, Elham House Developments Ltd transferred Elham House to Barclays Bank Trust Co Ltd, to be held for the benefit in due course of the members of the Regency Villas Owners Club (RVOC) to be constituted by the purchasers of timeshare units within the Regency Villas development. The 1981 Transfer included the grant of rights which is the subject of the present dispute. I shall refer to that grant of rights as the Facilities Grant. The transfer itself has been lost, but the relevant terms of the Facilities Grant were duly recorded at HM Land Registry, on the Property Register in respect of the title to Elham House, and on the Charges Register against each of the two registered titles together constituting the Park. The words of the Facilities Grant appear in the last of three paragraphs, all of which it is appropriate to set out in full, so that the last paragraph appears in its context: TOGETHER WITH firstly the right of way for the Transferee its successors in title its lessees and the occupiers from time to time of the property at all times with or without vehicles for all purposes in connection with the use and enjoyment of the property over and along the drive ways and roadways (hereafter called the roadways) shown coloured blue on the plan attached hereto. AND Secondly all the right to the full and free passage of gas water soil electricity and any other services from and to the property in and through any pipes drains wires cables or other conducting media now in under or over the Transferees adjoining land or constructed within 80 years of the date hereof. AND thirdly the right for the Transferee its successors in title its lessees and the occupiers from time to time of the property to use the swimming pool, golf course, squash courts, tennis courts, the ground and basement floor of the Broome Park Mansion House, gardens and any other sporting or recreational facilities (hereafter called the facilities) on the Transferors adjoining estate. The 1981 Transfer also contained a covenant by Gulf Investments to maintain the sporting and recreational facilities within the Park, but it is common ground that the burden of this covenant, being positive in nature and unsupported by a leasehold structure, did not bind successors in title to the Park, including the appellants. By the time of the 1981 Transfer, there had already been constructed within the Park most of the relevant sporting and recreational facilities, including the golf course, the outdoor heated swimming pool, three squash courts, two tennis courts, a restaurant, billiard/snooker room and TV room on the ground floor of the Mansion House and a gymnasium, including sauna and solarium, in the basement. There were also Italianate gardens, a putting green, a croquet lawn, an outdoor jacuzzi/spa pool, an ice/roller skating rink, platform tennis courts, a soft ball court and riding stables. These facilities did not cover the whole of the Park, as defined. There remained about 90 acres of undeveloped farmland, which remain undeveloped to this day. An officious bystander in 1981 might well have been prompted to ask how it was envisaged by the promoters of these two timeshare schemes that the extensive sporting and recreational facilities of which the timeshare owners were to be afforded the free use were to be managed, maintained and when necessary renewed by the owners of the Park, to the high standards promised in the contemporary promotional materials, without any contribution from them. Although nowhere clearly stated in the evidence, the answer appears to be that the promoters envisaged that the operation of the leisure complex within the Park as a golf course and county club would attract sufficient paying members of the public (other than timeshare owners in either of the two timeshare developments) to fund its ongoing operating costs. If that was the expectation, it does not appear to have been fulfilled. Correspondence in and after 1998 between the RVOC and Broome Park Golf & Country Club, then owning or at least managing the Park, describes a reduction in the number of available facilities, a lack of investment in the Park, and a perception that, without some significant contribution to running costs by the RVOC members, whether or not under legal obligation, the facilities offered at the Park would be likely to deteriorate further. The outdoor swimming pool became disused and was filled in by 2000. The failure to maintain a swimming pool within the Park was a breach of the landlords covenants in the BPOC lease and, pursuant to an order of HHJ Pelling QC in proceedings brought by the BPOC, a new pool was constructed in part of the basement of the Mansion House, where the gymnasium had previously been situated. Some other facilities, such as the putting green, croquet lawn, jacuzzi/spa pool and roller skating rink had been closed and the riding stables were demolished. Apart from the major change constituted by the erection of the indoor swimming pool, other minor changes occurred to the facilities within the ground floor and basement of the Mansion House. Meanwhile, a third timeshare development was constructed within the Park in about 2003, bringing the total number of timeshare apartments within the Park (including the Regency Villas development) to some 58. Finally, the BPOC lease expired by effluxion of time, shortly after the trial, in 2015. The Mansion House was then temporarily closed for refurbishment and reopened as an hotel. From time to time, beginning in about 1983, RVOC made voluntary payments on behalf of timeshare owners within the Regency Villas development to the owners and operators of the Park towards the cost, including upkeep, of the facilities. While made under a reservation of rights, these payments were usually in agreed amounts, at least until the end of 2011. Thereafter, and in the absence of any agreement to amounts, individual timeshare owners were charged fees from time to time for the use of specific facilities, which they paid notwithstanding their case that they were entitled to the use of those facilities free of charge. The Litigation The first claimant (and first respondent in this court) is the freehold owner of Elham House. The remaining claimants are individual timeshare members of the RVOC. They sue upon their own behalf and on behalf of all other members. They claimed a declaration that they were entitled, by way of easement, to the free use of all the sporting or recreational facilities from time to time provided within the Park, and an injunction restraining interference with them by the defendants (and appellants in this court) who are the current freehold and leasehold owners of the Park and parts thereof. In addition the claimants sought the return of sums paid by them or on their behalf by the RVOC for the use of those facilities since 2008, as damages for interference with their easement, or by way of restitution. The defendants denied that the claimants had the benefit of any easement in relation to the facilities, and counterclaimed for a quantum meruit in respect of the provision of those facilities in and after 2012, to the extent not paid for, or not paid for in full. At the trial before the late Judge Purle QC sitting as a High Court judge in 2015 the claimants succeeded in all their claims, save only for the recovery of payments made for the use of facilities before 2012, which the judge found had been made by agreement rather than under protest, in circumstances giving rise to no restitutionary claim: [2016] 4 WLR 61. That monetary claim has not been further pursued by the claimants. In the Court of Appeal (Sir Geoffrey Vos C, Kitchin and Floyd LJJ) [2017] Ch 516 the claimants were again successful on the main issue about whether the rights over the facilities granted by the 1981 Transfer constituted an easement or easements, but the judges decision was reversed on matters of detail. In particular, the claimants were held to have no rights in relation to the new swimming pool constructed in the basement of the Mansion House. The Court of Appeals declaration confirmed their rights to specific existing facilities, namely the golf course, squash courts, tennis courts, croquet lawn, putting green and Italianate gardens, but excluded rights in relation to anything provided on the ground floor and basement of the Mansion House. The claimants monetary entitlement in relation to payments in and after 2012 was correspondingly reduced, and the defendants obtained judgment for a quantum meruit in respect of those facilities provided in and after 2012 to which the claimants rights did not extend, of which the most important was the swimming pool. In this court the appellant defendants pursue their contention that the 1981 Transfer granted no enduring rights in the nature of easements in relation to any of the facilities within the Park, while the claimants by respondents cross appeal seek to restore the judges conclusion as to the full extent of their rights in relation to the facilities, including the new swimming pool, and accordingly seek to have dismissed the Court of Appeals order for a quantum meruit in favour of the defendants. The Issues Much the most important group of issues (which have given rise to almost all the oral argument on this appeal) are those which govern the question whether the Facilities Grant is capable in law of amounting to one or more easements. Those are the issues which justified the grant of permission to appeal. The subordinate issues, relating to the claimants rights if any in relation to the ground floor and basement of the Mansion House, and in particular to use of the new swimming pool, give rise to no general issues of law of public importance, but all the issues turn to a greater or lesser extent upon the true construction of the Facilities Grant, to which I now turn. Construction of the Facilities Grant The main features of the matrix of fact against which the 1981 Transfer has to be construed are, in my view, as follows. First, the 1981 Transfer was part and parcel of a collaborative exercise undertaken by two associated companies within the same Gulf Group for a common purpose, namely the development of timeshare apartments and the profitable sale of timeshare units on land immediately adjacent to an already up and running leisure complex, containing sporting and recreational facilities in a clubhouse and associated parkland adjacent to and entirely surrounding the subject matter of the 1981 Transfer. Secondly, not least because they shared a common conveyancing solicitor, both parties to the 1981 Transfer may be taken to have known about the leasehold structure underpinning the development of the timeshare units within Mansion House itself, including the obligation, binding on Gulf Investments as landlord, and upon its successors in title as owners of the Park, to maintain, repair, construct and (where necessary) reconstruct all the sporting or recreational facilities provided within the Park (including within the Mansion House), for the full period of 35 years provided for in the BPOC Lease, which expressly contemplated that the rights of the BPOC timeshare owners would extend to all those facilities provided within the Park at any time during that term (see Schedule 3, paragraph 8). Gulf Investments had therefore committed both itself and its successors in title to the provision, operation and maintenance of those facilities by binding obligations which, if necessary, could be enforced against them by a large number of timeshare owners, constituting the BPOC. Thirdly both parties also knew, by their common conveyancing solicitor, of the planned structure under which, only one day after the 1981 Transfer, the interest of the grantee was to be transferred on to a successor in title, for the benefit of the future timeshare owners within the Regency Villas scheme whom both parties wished to attract as purchasers. Construed against that contextual background, the following points emerge as aspects of the true construction of the Facilities Grant in the 1981 Transfer. First, it is abundantly plain that, whether successfully or not, the parties intended to confer upon the Facilities Grant the status of a property right in the nature of an easement, rather than a purely personal right. It was expressed to be conferred not merely upon the Transferee, but upon its successors in title, lessees and occupiers of what was to become a timeshare development in multiple occupation. That being the manifest common intention, the court should apply the validation principle (ut res magis valeat quam pereat) to give effect to it, if it properly can. Secondly, and although reference is made to a number of different specific facilities within the Park, the Facilities Grant is in my view in substance the grant of a single comprehensive right to use a complex of facilities, and comprehends not only those constructed and in use at the time of the 1981 Transfer, but all those additional or replacement facilities thereafter constructed and put into operation within the Park as part of the leisure complex during the expected useful life of the Regency Villas timeshare development for which the 1981 Transfer was intended to pave the way. It is, in short, a right to use such recreational and sporting facilities as exist within the leisure complex in the Park from time to time. In that respect I agree with the judges analysis of this point (at para 44 of his judgment) and disagree with the approach of the Court of Appeal, which treats each facility as the subject of a separate grant of rights, referable only to the separate locus in quo of each relevant facility at the time of the grant. I shall explain my full reasoning for this conclusion when dealing with the cross appeal, below, but the main point is this. The Court of Appeal regarded the absence of words of futurity in the language of the Facilities Grant (in contrast with the grant relating to the passage of services in the immediately preceding paragraph) as a strong pointer to a construction which limited the rights granted only to those facilities already in existence. This was also a main plank in the written submissions of the appellants on this point. In my view the absence of express words of futurity is amply compensated by the inherent nature of the subject matter of the third paragraph, namely the combination of sporting and recreational facilities in a leisure complex which would be bound to be subjected to significant alterations and changes during its business life. It may be that in this respect the Court of Appeal was encouraged to depart from the judges more coherent analysis because of a fear on the part of those advising the claimants that to construe the Facilities Grant as extending to the provision of additional or different facilities in the future might give rise to a risk of the grant being held to be void for perpetuity. In written submissions delivered at the courts invitation following the hearing, the appellants submit that this would indeed be the consequence of the judges construction. Although by 1981 the Perpetuities and Accumulations Act 1964 had intervened to provide a period of wait and see, the new swimming pool was in fact erected more than 21 years after the 1981 Transfer. In my judgment that concern of the claimants and submission of the appellants is misplaced, in relation to what appears to me to be a single grant of rights over a leisure complex comprising sporting and recreational facilities, which may be changed and adjusted from time to time to suit customer demand without giving rise to separate and distinct grants of rights taking effect only in the future. The main authorities relied upon by the appellants in support of their submission on perpetuity are Dunn v Blackdown Properties Ltd [1961] Ch 433 and Adam v Shrewsbury [2006] 1 P & CR 27. They show that where (in the case of a pre 2010 instrument) there is a grant of a future easement, or (which is in substance the same thing) a present easement which can only be enjoyed if and when, in the future, something is done on the servient land to make the easement useable, then the rule against perpetuities applies. In the Dunn case the grant was of sewerage rights, but no sewers existed at all at the time of the grant. In the Adam case the grant was the use of a garage yet to be constructed, on ground to be excavated by the grantor, accessible only from a roadway which was only partly constructed, at the time of the grant. In both cases the grants failed for perpetuity. In the present case, by contrast, the grant consisted of an immediately effective grant to use the sporting and leisure facilities in a leisure complex which existed as a complex at the time of the grant. The fact that the precise nature and precise location of those facilities within the Park might change thereafter, but the grant still apply to the complex as a whole, does not bring the grant within the rule. If by analogy there had already been a sewerage system on the servient land at the time of the grant in the Dunn case, the drainage easement would not have been defeated or rendered subject to perpetuity merely because, thereafter, the dominant owner made a change to the routeing of the pipework. Thirdly, there is no express provision requiring the grantee or its successors or timeshare owners to contribute to the cost of operating, maintaining, renewing and replacing facilities, and there has been no challenge to the judges conclusion that an attempt to discover them by way of implied term would fall foul of the necessity test. Nor is there, in the Facilities Grant itself, any such obligation imposed upon the grantor, although there is a separate, purely personal, covenant to that effect elsewhere in the 1981 Transfer. Much has been made of this personal covenant by the appellants in their written submissions on the judges construction. They say that it shows that the Facilities Grant was really intended only to be a grant of personal rights to the free use of a serviced sporting and leisure complex, and that the drafter wrongly assumed that the grantor could impose the servicing obligation on its successors in title as owners of the Park. This meant that the Facilities Grant would in law be of utility for as long (only) as the grantor should remain the owner of the Park, and dependent upon the purely personal covenant of the grantor, the benefit of which could be assigned to successors in title of the grantee as owners of Elham House. If this meant that the Facilities Grant was vulnerable to an early demise (for example on an early sale of the Park or its transfer to an associated company of the grantor) that was just the result of a conveyancing mistake which the court should do nothing to correct, and certainly not by the use of the validating principle of construction. I do not accept that submission. The personal covenant commits the Transferor to the maintenance, repair and cleansing of the roadways and the facilities. The roadways were plainly the subject of a conventional easement in the first of the three paragraphs (quoted above) the last of which contains the Facilities Grant. It cannot therefore be said that the existence of the personal covenant somehow reduces the Facilities Grant to a purely personal obligation, if it does not (and cannot) do so in relation to the right of way over the roadways. Although it is not clear, it may be that the conveyancer thought that the burden of a positive maintenance covenant ran with the land, but this does not impact upon the clear intention, manifest in relation to both the roadways and the facilities, that proprietary rights were being granted over them. I have sought to explain above how, in commercial terms, the parties to the 1981 Transfer may have anticipated that the leisure complex would be self financing (from the contributions of paying members of the public) without need to have recourse to contributions from the two groups of timeshare owners. In my judgment the common intention to be inferred from the absence of any provision in the Facilities Grant itself for such maintenance or funding obligations is that the parties to the 1981 Transfer (both of which were timeshare experts) were content to leave that as a matter of commercial risk, while seeking to maximise the capital receipts expected to be derived from the sale of timeshare units in connection with the Regency Villas apartments shortly thereafter to be constructed. Plainly, the imposition of a payment obligation on the timeshare owners would have had a dampening effect on the purchase prices likely to be obtained. The Appeal Mr Tim Morshead QC for the appellants described the Facilities Grant as one which conferred the right of free access for the Regency Villas timeshare owners to a high class leisure complex providing recreational and sporting attractions otherwise being provided by the appellants within the Park for paying members of the public. He submitted that such a grant of rights was incapable of amounting to an easement or easements for three main reasons: The rights did not accommodate Elham House, the dominant i) tenement; ii) Their exercise by the RVOC timeshare owners would amount to an ouster of the appellants as owners of the Park; iii) The enjoyment of the rights by the RVOC timeshare owners depended upon substantial expenditure by the appellants in managing and maintaining the facilities. Recognising that the decision in In re Ellenborough Park would be likely to constitute the sheet anchor in any case for treating the Facilities Grant as an easement (as it had been in both the courts below), the appellants in their printed case submitted that the decision was contrary to principle, in so far as it suggested that rights conferred for the pure (or mere) enjoyment of their exercise, rather than the better enjoyment of the dominant tenement as such, could satisfy the requirement that they accommodate the dominant tenement. In his oral submissions in this court, Mr Morshead preferred to focus on the private nature of the use of the communal garden in that case as that which, in sharp contrast with the Facilities Grant in this case, made it (just) legitimate to describe the rights conferred as accommodating the townhouses surrounding the garden. Before addressing the Ellenborough Park case directly, it is convenient first to summarise what, by the 1950s, were the well established conditions for the recognition of a right as an easement. Writing in 1954, Dr Cheshire described the four essential characteristics as follows: There must be a dominant and a servient tenement; i) ii) The easement must accommodate the dominant tenement; iii) The dominant and servient owners must be different persons; iv) A right over land cannot amount to an easement, unless it is capable of forming the subject matter of a grant. Aspects of these requirements are better understood when it is appreciated that easements may be created, not only by express grant, but also by implied grant, upon the transfer of part of land formerly in single ownership under the rule in Wheeldon v Burrows (1879) 12 Ch D 31, under section 62 of the Law of Property Act 1925 and by prescription. In the present case, as in In re Ellenborough Park, it is the second and fourth of those requirements with which the court is concerned. The Second Requirement The requirement that the right, if it is to be an easement, should accommodate the dominant tenement has been explained by judges, textbook writers and others in various ways. In his Modern Law of Real Property, 7th ed (1954) at p 457, Dr Cheshire expressed it in this way: One of the fundamental principles concerning easements is that they must be not only appurtenant to a dominant tenement but also connected with the normal enjoyment of the dominant tenement. Citing from Bailey v Stephens (1862) 12 CB(NS) 91, at 115, he continued: It must have some natural connection with the estate as being for its benefit . In its report Making Land Work: Easements, Covenants and Profits Prendre (2011) Law Com No 327 (HC 1067) at para 2.25 the Law Commission advised: The easement must accommodate, or accommodate and serve, the dominant land. The requirement is that the right must be of some practical importance to the benefited land, rather than just to the right holder as an individual: it must be reasonably necessary for the better enjoyment of that land. In the present case, the Court of Appeal described this requirement, at para 56, as follows: In our view, the requirement that an easement must be a right of utility and benefit is the crucial requirement. The essence of an easement is to give the dominant tenement a benefit or utility as such. Thus, an easement properly so called will improve the general utility of the dominant tenement. It may benefit the trade carried on upon the dominant tenement or the utility of living there. Save only for easements of support (which may be said to benefit the land itself), easements generally serve or accommodate the use and enjoyment of the dominant tenement by human beings. Thus, a right of way makes the dominant tenement more accessible. Service easements enable the occupiers of the dominant tenement to receive water, gas and electricity. A drainage easement enables rainwater and sewage to be removed from land, in circumstances where its use would otherwise be inhibited by flooding. The following general points may be noted. First, it is not enough that the right is merely appurtenant or annexed to the dominant tenement, if the enjoyment of it has nothing to do with the normal use of it. Nor is it sufficient that the right in question adds to the value of the dominant tenement. Thus for example, a right granted to the owners and occupiers of a house in Kennington to have free access to the Oval cricket ground on test match days might be annexed to the ownership of that house, and add significantly to its value. But it would have nothing to do with the normal use of the property as a home. Secondly, the normal use of the dominant tenement may be a residential use or a business use. Further, since easements are often granted to facilitate a development of the dominant tenement, the relevant use may be not merely an actual use, but a contemplated use: see for example Moncrieff v Jamieson [2007] 1 WLR 2620, per Lord Neuberger of Abbotsbury, at paras 132 133. Thirdly, it is not an objection to qualification as an easement that the right consists of or involves the use of some chattel on the servient tenement. Examples include a pump (Pomfret v Ricroft (1668) 1 Saund 321), a lock and a sluice gate (Simpson v Godmanchester Corpn [1897] AC 696), and even a lavatory (Miller v Emcer Products Ltd [1956] Ch 304). Fourthly, although accommodation is in one sense a legal concept, the question whether a particular grant of rights accommodates a dominant tenement is primarily a question of fact: see per Evershed MR in In re Ellenborough Park at p 173. Recreational rights The main controversy in the present case arises because the Facilities Grant conferred recreational and sporting rights, the enjoyment of which may fairly be described as an end in itself, rather than a means to an end (ie to the more enjoyable or full use of the dominant tenement). The origin of the controversy lies in the Roman law doctrine that a ius spatiandi cannot constitute a servitude: see per Evershed MR giving the judgment of the Court of Appeal in In re Ellenborough Park, at p 163. For present purposes that Latin phrase may simply be translated as meaning a recreational right to wander over someone elses land. The difficulty arises as an aspect of the requirement that the right must accommodate the dominant tenement precisely because, generally speaking, the sporting or recreational right will be enjoyed for its own sake, on the servient tenement where it is undertaken, rather than as a means to some end consisting directly of the beneficial use of the dominant tenement. Prior to Ellenborough Park, there were inconclusive dicta for and against the recognition of recreational rights as easements. Duncan v Louch (1845) 6 QB 904 was about the alleged obstruction of a right of way granted in 1675 over a close called the Terrace Walk. Lord Denman CJ said this, at p 913: I think there is no doubt in this case. Taking the right, as Mr Peacock suggests, to be like the right of the inhabitants of a square to walk in the square for their pleasure, they paying the necessary rates for keeping it in order, I cannot doubt that, if a stranger were to put a padlock on the gate and exclude one of the inhabitants, he might complain of the obstruction, and a stranger would not be permitted to say that the plaintiffs right was only conditional. By contrast, in Mounsey v Ismay (1865) 3 H & C 486, it was decided that a customary public right to hold horse races was not an easement within the meaning of section 2 of the Prescription Act 1832 (2 & 3 Will 4, c 71). Baron Martin, delivering the judgment of the court, said, at p 498: we are of opinion that to bring the right within the term easement in the second section it must be one analogous to that of a right of way which precedes it and a right of watercourse which follows it, and must be a right of utility and benefit, and not one of mere recreation and amusement. On opposite sides of the same debate may be found Keith v 20th Century Club Ltd (1904) 73 LJ Ch 545 (in favour); International Tea Stores Co v Hobbs [1903] 2 Ch 165 at 172, and Attorney General v Antrobus [1905] 2 Ch 188 at 198 (Farwell J in both cases, against). I consider that In re Ellenborough Park should be taken to have been dipositive of this issue for the purposes of English common law, to this extent, namely that it is not fatal to the recognition of a right as an easement that it is granted for recreational (including sporting) use, to be enjoyed for its own sake on the servient tenement. The question in every such case is whether the particular recreational or sporting rights granted accommodate the dominant tenement. In In re Ellenborough Park the right was to the full use of a garden square (surrounded on three sides by houses and on the fourth by the sea), and the dominant tenements were all the houses surrounding the garden together with a small number of additional houses nearby which did not front onto the square. The rights granted did not accommodate those additional houses on the basis that the garden could be seen by persons from the dominant tenement. It was only by the permitted use of the garden that the requisite accommodation could be established. Evershed MR described the enjoyment contemplated by the full enjoyment of the pleasure ground as follows, at p 168: The enjoyment contemplated was the enjoyment of the vendors ornamental garden in its physical state as such the right, that is to say, of walking on or over those parts provided for such purpose, that is, pathways and (subject to restrictions in the ordinary course in the interest of the grass) the lawns; to rest in or upon seats or other places provided; and, if certain parts were set apart for particular recreations such as tennis or bowls, to use those parts for those purposes, subject again, in the ordinary course, to the provisions made for their regulation: but not to trample at will all over the park, to cut or pluck the flowers or shrubs, or to interfere in the laying out or upkeep of the park. He continued: Such use or enjoyment is, we think, a common and clearly understood conception, analogous to the use and enjoyment conferred upon members of the public, when they are open to the public, of parks or gardens such as St Jamess Park, Kew Gardens or the Gardens of Lincolns Inn Fields. Turning to the question of accommodation, he continued, at p 174, by contrasting the right granted to the purchaser of a house to use the Zoological Gardens free of charge or to attend Lords cricket ground without payment, with a sale of part of the freehold of a house and garden with a right to the purchaser to use the garden in common with the vendor. He said, at pp 174 175: In such a case, the test of connection, or accommodation, would be amply satisfied; for just as the use of a garden undoubtedly enhances, and is connected with, the normal enjoyment of the house to which it belongs, so also would the right granted, in the case supposed, be closely connected with the use and enjoyment of the part of the premises sold. Such, we think, is in substance the position in the present case. The park became a communal garden for the benefit and enjoyment of those whose houses adjoined it or were in its close proximity. It is the collective garden of the neighbouring houses, to whose use it was dedicated by the owners of the estate and as such amply satisfied in our judgment, the requirement of connection with the dominant tenements to which it is appurtenant. The result is not affected by the circumstance that the right to the park is in this case enjoyed by some few houses which are not immediately fronting on the park. The test for present purposes, no doubt, is that the park should constitute in a real and intelligible sense the garden (albeit the communal garden) of the houses to which its enjoyment is annexed. This careful and compelling judgment of the court repays reading in full. I have cited the above passages because they demonstrate the following points. First, and contrary to the main submission for the appellants in the present case, the Court of Appeals conclusion did not depend upon the rights granted being essentially private in nature. On the contrary, they were described as broadly similar to those enjoyed by the public over well known parks and gardens in London. Secondly, the rights granted were essentially recreational, although they included limited sporting elements. Thirdly, the reason why the accommodation requirement was satisfied was not because the rights were recreational in nature, but because the package of rights afforded the use of communal gardens to each of the townhouses to which the rights were annexed. They provided those houses with gardens, albeit on a communal basis, and gardens were a typical feature serving and benefiting townhouses as dominant tenements. In the present case the dominant tenement was to be used for the development, not of homes, still less townhouses, but of timeshare apartments. Although in terms of legal memory timeshare is a relatively recent concept, timeshare units of this kind are typically occupied for holidays, by persons seeking recreation, including sporting activities, and it is to my mind plain beyond a doubt (as it was to the judge) that the grant of rights to use an immediately adjacent leisure development with all its recreational and sporting facilities is of service, utility and benefit to the timeshare apartments as such, just as (although for different reasons) the grant of rights over a communal garden is of service, utility and benefit to a townhouse. The appellants submitted that the grant of such extensive recreational and sporting rights (including the use of a fully serviced and maintained 18 hole championship golf course) could not be regarded as accessory to the timeshare apartment, in the same way that a garden is accessory to a house. Rather, Mr Morshead submitted, use of the timeshare apartment was an accessory to the enjoyment of the recreational and sporting rights, so that to treat the rights as an easement for the benefit of the timeshare unit was to allow the tail to wag the dog. Reliance for that purpose was placed on Hill v Tupper (1863) 2 H & C 121, in which the owner of the Basingstoke Canal granted the exclusive right to operate a pleasure boating business on the whole canal, annexed to a small strip of land on the canal side near Aldershot, upon which the grantee intended to erect a boathouse. Giving the leading judgment Pollock CB said: I do not think it necessary to assign any other reason for our decision, than that the case of Ackroyd v Smith (1850) 10 CB 164 expressly decided that it is not competent to create rights unconnected with the use and enjoyment of land, and annex them to it so as to constitute a property in the grantee. The case had been argued on the basis that the exclusive right to operate a pleasure boat business on the canal was in the nature of a profit rather than an easement, by way of analogy with a several fishery or a right of turbary. Unlike easements, there is no invariable requirement that a profit accommodate neighbouring land: see Gale on Easements, 20th ed (2017), at para 1 149. It appears from the full report of the submissions of counsel, and the judicial interventions therein, that it was not argued that the right granted accommodated the plaintiffs land on the canal side. The members of the court appear to have assumed that it did not, although, following In re Ellenborough Park, at least one commentator has suggested that the same facts might now give rise to an easement on that basis: see R N Gooderson, writing in the Cambridge Law Journal [1956] CLJ 24, 25. In my view Hill v Tupper was decided on the basis that the grant of a monopoly to carry on a pleasure boat business on the whole length of a canal (which ran from Chertsey to Basingstoke) was by its very nature incapable of constituting a proprietary right, merely by being annexed to the lease of a tiny section of the canal bank, regardless whether it did or did not accommodate the supposed dominant tenement. It was held to have been a perfectly valid grant of a personal right, as between the canal owner and the plaintiff lessee. But to sue for an infringement of it by another pleasure boat operator would have required the plaintiff to sue in his landlords name as the owner of the canal. Hill v Tupper is not therefore authority for the proposition that the grant of rights which accommodate land cannot be an easement unless their enjoyment is capable of being described (in proportionate terms) as subordinate or ancillary to the enjoyment of the dominant tenement. Providing that the rights are for the benefit or utility of the dominant tenement as such, it matters not that their enjoyment may be a primary reason why persons are attracted to acquire rights (such as timeshare units) in the dominant tenement. The Fourth Condition At first sight, the condition that the rights must be capable of forming the subject matter of a grant appears more apposite for testing the validity, as easements, of rights said to have been acquired otherwise than by grant, for example by prescription. In In re Ellenborough Park the exact significance of this fourth condition was described, at p 164, as at first sight perhaps, not entirely clear. But it has come to be a repository for a series of miscellaneous requirements which have been held to be essential characteristics of an easement. They include the requirements that the right is defined in sufficiently clear terms, that it is not purely precarious, so as liable to be taken away at the whim of the servient owner, that the right is not so extensive or invasive as to oust the servient owner from the enjoyment or control of the servient tenement, and that the right should not impose upon the servient owner obligations to expend money or do anything beyond mere passivity. It used to be said that this fourth condition included the proposition that a mere right of recreation and amusement which conferred no quality of utility or benefit, could not be an easement. I have dealt with this supposed condition by reference to the question whether the grant accommodates the dominant tenement. If, as here, the accommodation test is satisfied, then the fact that it may be a right to use recreational or sporting facilities does not, as the Ellenborough Park case makes clear, disable it from being an easement. Furthermore, the advantages to be gained from recreational and sporting activities are now so universally regarded as being of real utility and benefit to human beings that the pejorative expression mere right of recreation and amusement, possessing no quality of utility or benefit has become a contradiction in terms, viewed separately from the issues as to accommodation of the dominant tenement. Recreation, including sport, and the amusement which comes with it, does confer utility and benefit on those who undertake it. Returning to the other aspects of this fourth condition, there is no doubt in this case that the Facilities Grant was in sufficiently clear and precise terms, and it is not said to have been merely precarious. The appellants objections have been formulated under the headings of ouster and mere passivity. These requirements serve a common public policy purpose, namely to prevent freehold land being permanently encumbered by proprietary restrictions and obligations which inhibit its utility to an unacceptable degree. The precise extent of the ouster principle is a matter of some controversy, which it is unnecessary to resolve on this occasion. The view of the Law Commission, in its 2011 paper Making Land Work: Easements, Covenants and Profits Prendre at paras 3.207 3.211, is that the scope for litigation created by its uncertainties sufficiently outweighs its utility that it should be abolished. The controversy usually causes difficulty in the context of parking rights, and its extent is sufficiently summarised (for present purposes) in the speech of Lord Scott in Moncrieff v Jamieson (supra) at paras 54 to 61 (in which he treated the Scottish law of servitudes as for all relevant purposes the same as the English law of easements). Leaving aside cases where the grant confers exclusive possession, which cannot by definition be an easement, the ouster principle rejects as an easement the grant of rights which, on one view, deprive the servient owner of reasonable beneficial use of the servient tenement or, on the other view, deprive the servient owner of lawful possession and control of it. In the present case the appellants ouster argument focused upon possession and control rather than reasonable beneficial use. It may be summarised as follows. The grant of the facilities rights, particularly in relation to the golf course, must be assumed to carry with it a step in right of the dominant owner to manage and maintain the relevant recreational and sporting facilities in the event that, being under no obligation to the dominant owner to do so, the appellants as servient owners ceased to do so themselves. A championship golf course requires not merely occasional maintenance but day to day management and supervision, to an extent that would require the dominant owners to take control of the golf course, and other facilities such as tennis and squash courts, if only to regulate their use in accordance with a booking system. Thus, the exercise of those step in rights would deprive the appellants of possession or control of the Park, or substantial parts of it, thereby amounting to ouster. The judge and the Court of Appeal rejected these submissions, on the basis of a concurrent factual analysis. Even the golf course could have been kept in a playable condition (although not as an immaculate championship course) by the exercise of those step in rights, without the dominant owners taking possession or control: see in particular paras 77 and 78 of the judgment of the Court of Appeal, and the analogy drawn with Dowty Boulton Paul Ltd v Wolverhampton Corpn (No 2) [1976] Ch 13, where the right to take off and land airplanes on an airfield enabled the dominant owners to step in and mow the field sufficient to create and maintain runways when the servient owners discontinued its use as an airfield. This was held not to amount to an ouster. No basis was shown in the appellants submissions to justify this court taking a different view of that essentially factual question. But I would go further. In my view it is wrong in principle to test the issue whether a grant of rights amounts to an ouster of the servient owner by reference to what the dominant owner may do by way of step in rights if the servient owner ceases to carry out the necessary management and maintenance of the servient tenement. This is for two reasons. The first is that the ouster question should be addressed by reference to what may be supposed to have been the ordinary expectations of the parties, at the time of the grant, as to who, as between dominant and servient owners, was expected to undertake the management, control and maintenance of the servient tenement. In the present case, as the judge held, the plain expectation was that the relevant part of the Park would be managed, controlled and maintained as a leisure complex by its owners, rather than by the owners of Elham House or by the timeshare owners as members of the RVOC. The exercise of step in rights by the dominant owners would arise only in the event that the owners of the Park gave up the management, control and maintenance of the recreational and sporting facilities. Nothing in the terms of the Facilities Grant impinged upon those rights of management and control in any way. The second reason is that step in rights are, by definition, rights to reasonable access for maintenance of the servient tenement, sufficient, but no more than sufficient, to enable the rights granted to be used: see Gale on Easements, 20th ed, at para 1 93 and Carter v Cole [2006] EWCA Civ 398; [2006] NPC 46 per Longmore LJ at para 8(6). The dominant owners right is to enter the servient owners land for the purpose, but only to do necessary work in a reasonable manner . Provided that, as the courts below have held, the recreational and sporting facilities in the Park could be used by the RVOC timeshare owners without taking control of the Park, then no question of ouster arises. Mere Passivity It is well settled that (subject to irrelevant exceptions) an easement does not require anything more than mere passivity on the part of the servient owner: see Gale (op cit) at para 1 96 and Jones v Price [1965] 2 QB 618 at 631, per Willmer LJ: properly speaking, an easement requires no more than sufferance on the part of the occupier of the servient tenement, In Moncrieff v Jamieson (supra) at para 47, Lord Scott of Foscote said: the grant of a right that required some positive action to be undertaken by the owner of the servient land in order to enable the right to be enjoyed by the grantee could not, in my opinion, be a servitude. He then referred to a right to use a neighbours swimming pool as an example of such a right. This does not mean that easements cannot be granted if they involve the use of structures, fixtures or chattels on the servient tenement, which, in the ordinary course, the parties to the grant expect that the servient owner will manage and maintain. All it means is that the grant of the easement does not impose upon the servient owner an obligation to the dominant owner to carry out any such management or maintenance. The servient owner may do so because he wishes to use the structures, fixtures or chattels for the same purpose as the dominant owner, and has both the possession and control of the servient tenement and more resources than the dominant owner with which to do so. The grantor may or may not choose to make enjoyment of the easement conditional upon the dominant owner making a contribution towards the cost of management and maintenance, but no such contribution obligation will lightly be implied. There may, as in the present case, be a commercial expectation that the servient owner will undertake the cost and other burdens of management and maintenance, but the fact that the shared commercial expectation may have been (as in the present case) built upon sand rather than rock, so that those burdens prove uneconomic for the servient owner, will not affect the question whether the grant of the relevant rights constitutes an easement. I have already mentioned examples of easements calling for the use of fixtures or chattels, such as the lock gates and sluices in Simpson v Godmanchester Corpn, the pump in Pomfret v Ricroft and the humble lavatory in Miller v Emcer. Perhaps the most telling example is the grant of a right of way over a route which includes a substantial bridge: see Jones v Pritchard [1908] 1 Ch 630 at 637. This may require significant regular maintenance, and (in connection with a freehold easement) the large expense of occasional reconstruction. If granted by the owners of a substantial landed estate in favour of the owners of a cottage to which the right of way is the only means of access, it may be inconceivable in the real world that the maintenance, repair and replacement of the bridge will in fact be undertaken by anyone other than the servient owners. Nonetheless the grant of the easement carries with it no obligation on the part of the servient owners to carry out maintenance, repair or replacement, even if the bridge were, in the absence of it, to become unusable. There is therefore nothing inherently incompatible with the recognition of a grant of rights over land as an easement that the parties share an expectation that the servient owner will in fact undertake the requisite management, maintenance and repair of the servient tenement, and of any structures, fittings or even chattels located thereon. The only essential requirement (imposed to prevent land being burdened to an extent contrary to the public interest) is that the servient owner has undertaken no legal obligation of that kind to the dominant owner. There plainly was in the present case a common understanding between the respective grantor and grantee of the rights over the recreational and sporting facilities in the Park that the significant cost of the management, maintenance, repair and replacement of the structures, fixtures and, if necessary, chattels, requisite for the enjoyment of those rights would be undertaken by the successive owners of the Park. That was the express basis upon which the Regency Villas timeshare units were offered for sale to the public in the promotional materials put in evidence at the trial. But the concurrent analysis of the judge and of the Court of Appeal that the Facilities Grant did not of itself impose such obligations on the servient owners of the Park cannot in my view be faulted. True it is that, in the same document, the original grantor undertook a personal maintenance obligation to the original grantee, but this was (or should have been) known at the time of the conveyancing to have a one day limited life, because of the intention that there should be an immediate further transfer of Elham House. This personal covenant did not form part of the Facilities Grant. The appellants submitted nonetheless that the Facilities Grant was no more than illusory as a grant of rights of practical utility for an unlimited period unless the owners for the time being of the Park undertook responsibility to the dominant owners for the substantial cost of management, maintenance, repair and renewal. They relied on Lord Scotts example of the swimming pool, although it was only an obiter observation in a case about parking rights. The courts below rejected this on the facts, concluding that some meaningful use, even of the golf course and the swimming pool, could be enjoyed by the RVOC timeshare owners, even if the appellants or their successors as owners of the Park were altogether to discontinue the business of operating the relevant part of the Park as a leisure complex. Greens and even fairways on the golf course could be mown. The swimming pool could be kept full of water. Timeshare owners could provide their own nets for the tennis courts, hoops for the croquet lawn and (if necessary with the use of a generator) lighting for the squash courts. The appellants submitted with force that this would be nothing like the proffered use of a high quality leisure complex held out to prospective timeshare owners in and shortly after 1981, but nothing in their submissions provided a basis upon which this court could properly depart from the factual findings of the courts below that some less attractive but still worthwhile use could be made of the facilities in those circumstances. This conclusion, that meaningful use of the rights granted did not depend upon the continued provision of management, maintenance, repair and renewal by the servient owners, is also sufficient to confirm that use of the facilities was granted by way of right, rather than merely by way of temporary offering, revocable by the servient owners at any time, by discontinuing management and maintenance. It is not difficult to imagine recreational facilities which do depend upon the active and continuous management and operation by the servient owner, which no exercise of step in rights by the dominant owners would make useable, even for a short period. Free rides on a miniature steam railway, a covered ski slope with artificial snow, or adventure rides in a theme park are examples which would probably lie on the wrong side of the line, so as to be incapable of forming the subject matter of an easement. But the precise dividing line in any particular case will be a question of fact. It is in this context to be borne in mind, as already explained, that the Facilities Grant extended only to such sporting or recreational facilities as existed within the Park from time to time. It did not oblige the servient owner to maintain or operate any particular facilities, or any facilities. It is perfectly possible that, in relation to some of them, the exercise by the dominant owners of step in rights, after discontinuation of operation and maintenance by the servient owners, would not make them useable by the dominant owners indefinitely. That was an inherent limitation in the value of the Facilities Grant, but it does not deprive it of the character of an easement. Overview My analysis thus far demonstrates, as it did to the courts below, that the Facilities Grant exhibited all the well settled essential characteristics of an easement or easements, viewing each of the four characteristics (and the sub characteristics of the fourth) separately. But it still leaves open the wider question whether the grant for timeshare owners of comprehensive rights to the use and enjoyment of recreational and sporting facilities in an adjacent leisure complex is something which the law of easements ought to comprehend, looking at the matter in the round rather than in a series of compartments. The facilities granted in the present case undoubtedly broke new ground within the context of easements, beyond that established in In re Ellenborough Park, and this court is in any event not bound to follow that decision, if it considers it to have been wrong, either on its facts, or in the application of settled principles undertaken by Court of Appeal. The Facilities Grant in the present case may be treated as breaking new ground by comparison with In re Ellenborough Park, in three main respects. First, as Lord Carnwath points out, the nature and extent of the recreational and sporting facilities granted at Broome Park was much greater, and their full enjoyment called for much more intensive management, than that afforded in Ellenborough Park. An 18 hole golf course and a heated swimming pool by their nature require more management and maintenance than an ornamental garden, even if Ellenborough Park may also have included tennis courts and a bowling green. Secondly, Ellenborough Park was made available to a limited number of dominant owners, whereas the facilities at Broome Park were available to two, later three, different groups of timeshare owners and to paying members of the public. Thirdly, the cost of managing and maintaining Ellenborough Park was shared among the dominant owners, whereas in Broome Park it was at least expected to be undertaken by the servient owners. Additionally, the grant in this case can only be described as a right of recreation and amusement. It is a recreational right pure and simple (treating sport as part of recreation) whereas in In re Ellenborough Park the Court of Appeal fought shy of describing it in those terms, preferring to identify its essential feature as the provision of a communal garden for townhouses. Before expressing a conclusion, I must briefly identify factors pointing in favour of, and against, this extension of the law to recognise this new species of easement. In favour of doing so is the principle that the common law should, as far as possible, accommodate itself to new types of property ownership and new ways of enjoying the use of land. The timeshare development, which is quintessentially for holiday and recreational use, is just such a new type, and the common law should accommodate it as far as it can. Secondly, recreational easements have become widely recognised in the common law world. Thus in Riley v Penttila [1974] VR 547, the Supreme Court of Victoria recognised as an easement the grant of land within a residential development for the purposes of recreation over a garden or a park, in favour of residential lots, enthusiastically following the lead given in In re Ellenborough Park. In Dukart v Corpn of the District of Surrey [1978] 2 SCR 1039 the Supreme Court of Canada recognised as easements the grant in favour of residential lots on a development plan of rights to use foreshore reserves separating the lots from a bay, treating the analysis in In re Ellenborough Park as applying all the more emphatically in the case of a beach pertinent to a resort development (p 1052), and treating it as well settled that a ius spatiandi could be the subject matter of an easement. The Supreme Court stated in its declaratory order that the right so granted includes the right to promenade freely across the whole of the Foreshore Reserves and not merely to cross directly from the edge or front of Lot 38 to the waters of Boundary Bay: pp 1070 1071. Furthermore, the rights were not exclusive to the lot owners but were to be shared with certain more limited rights of public access from roads terminating short of the bay, and therefore across the foreshore reserves. In Blankstein v Walsh [1989] 1 WWR 277 the High Court of Manitoba recognised as an easement, acquired by prescription, recreational rights to use a communal playground, in favour of the owners of adjoining holiday cottages. In City Developments Pty Ltd v Registrar General of the Northern Territory [2000] NTSC 33, 135 NTR 1 the Supreme Court of the Northern Territory (affirmed by the Court of Appeal of the Northern Territory) recognised as an easement the grant of rights over a lakeside resort near Darwin for private recreational purposes, treating it as clearly established that a right of recreation may be the subject of a valid easement by reference to Halsburys Laws of Australia: [2001] NTCA 7, para 18. Against the broad recognition of recreational rights over a leisure complex as easements are two main factors. First, if annexed to a freehold, they are indeterminate in length, whereas a timeshare structure is frequently set up for a limited number of years. Furthermore the rights conferred are likely to burden the servient land long after the leisure complex in question has outlived its natural life. There is at present no statutory basis for the modification or discharge of easements, such as exists in relation to restrictive covenants, although the Law Commissions 2011 report proposes that there should be. Secondly, the use of easements as the conveyancing vehicle for the conferring of recreational rights for timeshare owners upon an adjacent leisure complex is hardly ideal, by comparison for example with a leasehold structure of the type used in this case for the BPOC timeshare owners. Although obligations to share the cost of management, maintenance, repair and renewal may be attached as conditions for the enjoyment of an easement (as they were in In re Ellenborough Park) there is no way in which enforceable obligations of that kind may be imposed upon the servient owners so that the burden of them runs with the servient tenement, in the same way that the burden of positive covenants may be made to run with a leasehold reversion. I have described how effective the leasehold scheme was for the BPOC timeshare owners, in enabling them to take proceedings to require the owners of Broome Park to construct a swimming pool, after the original open air pool had been filled in. In my view this court should affirm the lead given by the principled analysis of the Court of Appeal in In re Ellenborough Park, by a clear statement that the grant of purely recreational (including sporting) rights over land which genuinely accommodate adjacent land may be the subject matter of an easement, provided always that they satisfy the four well settled conditions which I have described. Where the actual or intended use of the dominant tenement is itself recreational, as will generally be the case for holiday timeshare developments, the accommodation condition will generally be satisfied. Whether the other conditions, and in particular the components of the fourth condition, will be satisfied will be a question of fact in each case. Whatever may have been the attitude in the past to mere recreation or amusement, recreational and sporting activity of the type exemplified by the facilities at Broome Park is so clearly a beneficial part of modern life that the common law should support structures which promote and encourage it, rather than treat it as devoid of practical utility or benefit. I would therefore dismiss the appeal. The Cross appeal The essence of the disagreement between the judge and the Court of Appeal which has led to the cross appeal may be summarised as follows. The judge regarded the Facilities Grant as, in substance, the grant of a single easement to use all such recreational and sporting facilities as might be provided from time to time within the leisure complex (including the Mansion House). At para 44 of his reserved judgment he explained this conclusion in the following way: There is nothing vague or of excessive width in the present rights. They clearly extend to all recreational and sporting facilities on the estate, and to the gardens, and must in my judgment include facilities that were not there or planned in 1981, or which may have been significantly improved since then. To construe the rights as limited to the actual facilities which were on site or planned in 1981 is unrealistic and might inhibit the servient owner from introducing improvements or replacements or adding facilities which would be for everyones benefit. I say that because any alteration to the facilities, if the rights did not extend to the new or replacement facilities, might amount to a substantial interference with the claimants existing rights. That cannot have been intended on any sensible construction of the rights. Moreover, such a construction would allow the defendants to advantage from their own default or that of their predecessors, who filled the outdoor pool in before the defendants constructed a new one in the basement of the Mansion House. The point is perhaps academic as the rights under the 1981 Transfer expressly extend to the basement, where the pool now happens to be. The Court of Appeal said that this was the wrong approach. It was held, at para 40 of the judgment of the court, that the most natural meaning of the words of the grant was a grant of rights in the nature of separate easements only over those sporting and recreational facilities already in existence on the Park at the time of the grant. This would therefore exclude new or substitute facilities constructed or laid out in a different part of the complex from the location of the original facilities, and also exclude rights over the ground floor and basement of the Mansion House which were not, viewed separately, recreational or sporting facilities, so as, for example, to exclude the use of the restaurant. The court then went on to look at each facility in turn, treating it as the subject of a separate grant of rights relating to a separate part of the Park. Thus the rights granted over the Italianate gardens, the tennis courts, the squash courts, the putting green and croquet lawn, the outdoor pool and the golf course all qualified as easements. By contrast the rights claimed over the reception area, billiard room and TV room on the ground floor of the Mansion House, and over the restaurant, bar, gymnasium, sun bed and sauna area in the basement, all failed to qualify. This was, because, viewed individually, none of them amounted to a sporting or recreational facility, the court observing in passing that a restaurant is not like a toilet and that the modern approach to taking physical exercise is not really applicable to recreational indoor games such as snooker or to watching television: para 80. Furthermore, the Court of Appeal concluded that, if the leisure business was closed, and the Park owners chattels removed, it would be stretching language to describe the bare room occupied in 1981, but no longer occupied, by a billiard table, as a billiard room. The same analysis was applied in relation to the gymnasium. The result was that the court concluded that there had not in 1981 been any valid grant of an easement over the ground floor or basement of the Mansion House. Since the new basement swimming pool replaced the original pool but on a different part of the leisure complex, the dominant owners acquired no rights over it. I have already indicated my clear preference for the judges simple and common sense analysis. There is in my view no answer to the judges pithy observation that to construe the rights as limited to the actual facilities on site or planned in 1981 is unrealistic, and that it would be likely to inhibit the servient owner from introducing improvements or replacements, or adding facilities, for the benefit of all users of the leisure complex in the Park. In my view the Court of Appeals approach, looking at the facilities grant as if it were a grant of separate rights to each facility, affecting separate and distinct parts of the complex, failed to see the wood for the trees. It is fair comment that counsel for the respondents provided less than full blooded support during oral argument for the judges simple analysis, although they did in subsequent written submissions. This reluctance was apparently because of a concern about the effect of the law relating to perpetuities upon what, on one view, might be regarded as the grant of future easements. But this concern was, in my view, misplaced for the reason which I have already given. I have also explained why, in my view, the absence of express words of futurity in the Facilities Grant is more than compensated for by the nature of the subject matter, namely rights to use sporting and recreational facilities in a leisure park on an indefinite basis. The timeshare owners in the Mansion House were plainly granted rights to use all such facilities as might be there from time to time, and it makes no sense at all to think that the parties to the grant of rights to the Regency Villas timeshare owners over the same leisure complex actually intended that they should have a steadily reducing set of rights, as alterations, replacements and improvements were made to the leisure complex over time. In written submissions after the hearing the appellants advanced additional reasons why the judges construction could not be correct. First, it was said that the Regency Villas timeshare owners would then benefit from a later decision by the servient owner to construct leisure or sporting facilities within that large part of the Park (as defined) to which the leisure complex did not extend in 1981. Part of it remained farmland, and still does. Secondly it was submitted that if the Transferor (or a successor) sold off parts of the Park for residential development and houses were built with private gardens or swimming pools, then the Regency Villas timeshare owners would have the free use of them as well. It may be that developments of that kind (none of which appear to have occurred) might throw up issues of construction with which the court might have to grapple. A possible answer might have been that the ambit of the locus in quo to which the Facilities Grant extended was confined to the Mansion House and the curtilage of the rest of the leisure complex as it then stood, but still leaving the servient owner free to substitute and re locate particular facilities within that curtilage, without either depriving the Regency Villas timeshare owners of their use, or enabling them to veto any such changes. Another answer (to the private gardens and pool point) may be that the facilities grant applied only to facilities constructed for multiple use, as part of the leisure complex. But these considerations do not in my view stand in the way of recognising the good sense and practicality of the judges interpretation, in preference to that of the Court of Appeal. It also makes no sense to conclude that the Regency Villas timeshare owners were to have no enduring rights to the facilities in the ground floor and basement of the Mansion House, which constituted the heart of what was plainly intended to be a country club. While it may be that a restaurant, viewed on its own, is not a recreational or a sporting facility, it is perfectly capable of being viewed as part of a sporting or recreational complex. There were no doubt communal lavatory facilities in the Mansion House to which the same analysis would apply. The parties to the 1981 Transfer cannot sensibly have intended to exclude the RVOC owners from access to the restaurant, the lavatories, or to any other communal parts of the ground floor and basement of the Mansion House. There is also in my view no real basis for the sharp distinction which the Court of Appeal drew between outdoor and indoor recreational and sporting facilities. A gym, a sauna, a billiard room and a TV room are no less recreational than a formal garden or a golf course. An enclosed squash court is no less sporting than an open air tennis court. Furthermore, the focus of the Court of Appeal on the importance of the servient owners chattels to the use of the billiard room, gymnasium and sauna within the Mansion House, while correct as a matter of fact, does not justify their exclusion from the appropriate subject matter of a recreational easement. For the reasons already given, it is no objection to the recognition of a right as an easement that it may be exercised over, or with the use of, chattels or fixtures on land, rather than merely over the land itself. My preference for the judges construction of the Facilities Grant over that adopted by the Court of Appeal is decisive of the outcome of the cross appeal. The new indoor swimming pool was, from the moment of its completion, a recreational or sporting facility constructed and made available within the leisure complex in the Park. The dominant owners already enjoyed rights over the communal parts of the ground floor and basement of the Mansion House which, viewed as part of the grant of a recreational easement over the leisure complex as a whole, were perfectly capable of having the enduring quality of an easement, or part of an easement. The result is, that for both of those reasons, but primarily the first of them, the respondents recreational easement extended to the new indoor swimming pool from the moment of its completion, as the judge held. I would therefore allow the cross appeal, and restore the judges consequential orders, including his order for monetary compensation, to be assessed, for the payment under protest by the respondents for the use of the facilities, in particular the swimming pool, in and after 2012. LORD CARNWATH: (dissenting) Since I am in a minority, I will explain my thinking relatively briefly. I gratefully adopt Lord Briggs comprehensive account of the factual and legal background. With one important qualification I agree with, or am prepared to accept, his analysis. I would be very happy to go further, since the merits seem all one way. There is no doubt that the respondents were intended to have free access to the recreational facilities on the estate. But for an elementary conveyancing error by the original vendors solicitors, they should also have had the benefit of a covenant by the owner of the estate to maintain those facilities. Instead they have been faced with years of uncertainty and dispute. However our view of the merits should not allow us to distort the correct understanding of a well established legal concept. Nor is there any need to do so. Whatever our conclusion on this appeal, no one suggests that the conveyancing technique used in this case is a suitable model for future time share arrangements of this kind. The important qualification relates to the nature of the right asserted. An easement is a right to do something, or to prevent something, on anothers land; not to have something done (see Gale on Easements, 20th ed (2017), para 1 80). The intended enjoyment of the rights granted in this case, most obviously in the case of the golf course and swimming pool, cannot be achieved without the active participation of the owner of those facilities in their provision, maintenance and management. The same may apply to a greater or lesser degree to other recreational facilities which have been or might be created, such as the skating rink or the riding stables (who provides and keeps the horses?). Thus the doing of something by the servient owner is an intrinsic part of the right claimed. Neither principle, nor any of the 70 or so authorities which have been cited to us, ranging over 350 years, and from several common law jurisdictions, come near to supporting the submission that a right of that kind can take effect as an easement. This point is if anything underlined by Lord Briggs use of such expressions as country club and leisure complex (paras 1, 83) to describe the enterprise. In effect what is claimed is not a simple property right, but permanent membership of a country club. He recognises that it would be a new species of easement, but sees it as justified by the need to accommodate new ways of enjoying the use of land and as a natural development of the recreational easements widely recognised in the common law world (paras 76 77). However, none of the cases which he cites (paras 77 78) involves more than access to land for the purposes of walking and enjoyment as a garden or park in much the same way as in In re Ellenborough Park [1956] Ch 131. I agree that those cases lend support to the affirmation at this level of the Court of Appeals reasoning in that case, but not for extending it to create a wholly new form of property right. Furthermore, as Lord Briggs accepts, there are other and better legal procedures for dealing with this new way of enjoying land, if that is what it is. This limitation was clearly recognised (albeit obiter, and in the context of the Scottish law of servitudes) by Lord Scott of Foscote in Moncrieff v Jamieson [2007] 1 WLR 2620, at para 47. Subject to a few qualifications he saw no reason why any right of limited use of the land of a neighbour that is of its nature of benefit to the dominant land and its owners from time to time should not be capable of being created as a servitudal right in rem appurtenant to the dominant land His second qualification is directly relevant and merits quotation in full: A second necessary qualification to the proposition afore stated would be that the grant of a right that required some positive action to be undertaken by the owner of the servient land in order to enable the right to be enjoyed by the grantee could not, in my opinion, be a servitude. Thus the grant of a right of way over a driveway cannot place on the servient owner the obligation to keep the driveway in repair: see Jones v Pritchard [1908] 1 Ch 630, 637. The dominant owner would be entitled, although not obliged, as a right ancillary to his right of way to do such repairs to the driveway as were necessary or desirable. On the other hand I doubt whether the grant of a right to use a neighbours swimming pool could ever qualify as a servitude. The grantor, the swimming pool owner, would be under no obligation to keep the pool full of water and the grantee would be in no position to fill it if the grantor chose not to do so. The right to use the pool would be no more than an in personam contractual right at best. That passage draws a significant distinction between two situations. The first is where the position of the servient owner is essentially passive, but the dominant owner is able, as a right ancillary to his right of way, to make good any failure to keep the way in repair. The availability of such a limited, and clearly defined, ancillary right does not detract from the validity of the servitude or easement. The second, by contrast, is where active participation by the servient owner is an intrinsic part of the intended right. Lord Scott referred simply to filling the pool, but he might have added a reference to the active maintenance which is needed to keep a modern pool in safe and useable condition. Sir Geoffrey Vos C [2017] Ch 516 acknowledged the problem but did not see it as insuperable: Similarly in respect of the golf course, he recognised that: We accept that modern swimming pools will often have sophisticated filtration, heating, chlorination, and water circulation systems. But such systems are not essential to the benefit and utility of using the pool. Water is obviously essential, but that can, as the judge indicated, be provided by the owner of the dominant tenement if the servient owner closes his business or allows the pool to fall into disrepair. The same applies to any desirable filtration or other plant. Simply providing the necessary water or even ones own filtration plant cannot be regarded as sharing possession of the land on which the pool is constructed . (para 72) contemporary golf courses have sophisticated networks of landscaped, manicured and irrigated tees, bunkers and greens, punctuated by sheds and shelters, tarmacked paths, sand boxes, pro shops and club houses. 76. The difficulty posed by an easement of this modern kind of golf course, which we assume for this purpose was closer to the one that was opened at Broome Park Estate in mid 1981, is the large amount of maintenance required to keep it in what many would regard as a playable condition. We are all familiar with the teams of groundsmen and greenkeepers that such courses need to employ to maintain them to the high standard that players frequently desire. However again he thought the problem not insuperable: 77. As regards the validity of an easement to use a fully maintained golf course, we take the view that it is necessary to consider what would occur if, as was common ground could happen, the servient owner closed or ceased to maintain it. As with providing the water for the swimming pool, the dominant owners could mow the grass and take any other necessary steps to make the course playable. Such mowing was accepted by the Court of Appeal to be appropriate in relation to a grass airfield in Dowty Boulton Paul Ltd v Wolverhampton Corpn (No 2) [1976] Ch 13. (para 77) He did however (unlike the judge) accept some limits to this approach, in respect of facilities on the ground floor of the Mansion House (such as the billiard and TV rooms), when rejecting the respondents submission that this was no more than a right to use the common parts: We think this submission proves too much. It shows that the right granted is really not in the nature of an easement at all. It is not about the use of any land, but the use of facilities or services that may for the time being exist on the land. As with the case of the restaurant which was in the basement in 1981, we cannot see how there can properly be an easement over such a service area. A restaurant is not like a toilet (over which an easement may exist as we have mentioned). It can only be useful and a benefit if someone cooks the food and sells it to the user. Likewise, a TV room is of no benefit without a TV. The tennis court and golf course are both proper uses of the servient land. The grant of the right to use recreational facilities on the ground floor of the Mansion House was really no more than a personal right to use chattels and services provided by the defendants (para 80) This is a false distinction in my view. The essence of the grant, in respect of the golf course and swimming pool, no less than the others, was to use recreational facilities provided by the servient owners. Lord Briggs deals with this issue first in the context of arguments about ouster (paras 62 65). I am inclined to agree with him, contrary to the appellants submissions, that the ouster question should be judged by reference to the ordinary expectations at the time of grant, rather than to possible exercise of step in rights. However it is with the following passage, under the heading Mere passivity, that I feel bound to take issue. Having accepted that an easement requires no more than sufferance on the part of the servient owner, he dismisses the appellants reliance on Lord Scotts observations in Moncrieff, by reference to what he deems the factual findings of the courts below that some less attractive but still worthwhile use could be made of the facilities in those circumstances. (para 71) I find this difficult to accept. It is not clear to me that the courts below made any true factual findings on this question, nor indeed that there was any evidence on which they could properly to do so. There was plenty of evidence about the nature and cost of the maintenance actually carried out by the estate. (See for example the evidence of Mr Robson, Head of Maintenance, para 10, as to the contracts for the maintenance of the pool.) There appears to have been no evidence as to what might realistically have been done by the residents, collectively or individually, in the absence of such central management. What is involved is not simply maintenance or repair, as in the case of a right of way, or even the mowing of a disused airstrip as in Dowty Boulton (see below); but taking over the organisation and management of a leisure complex (in Lord Briggs words). The judge dealt with this point very briefly, but by reference to legal theory rather than practical evidence: Mr Latimer also says, as is not disputed, that the rights cannot take effect as easements if the existence of the easements requires expenditure of money by the defendants, or the carrying on of a business by them. Yet the existence of the rights claimed produces no such requirement. The defendants could (as happened in the past) neglect the maintenance and upkeep of the estate allowing it to fall into disrepair. They could cease carrying on business at the estate for that reason, or on purely economic grounds, whether or not disrepair required the closure. In that case, if the rights take effect as easements, the claimants could intervene and, at their own expense, maintain and repair the facilities themselves, and tend the gardens: see generally Carter v Cole [2006] EWCA Civ 398 at para 8 . (para 52) Carter v Cole does indeed contain an authoritative summary by Longmore LJ of the ancillary rights of the dominant owner, but that was in the context of rights of way. The case tells one nothing about the practicalities of running and maintaining a modern golf course or swimming pool. The judge did, it is true, say that he saw no reason why the claimants could not provide their own water supply if necessary from a tanker (para 64); but this appears to have been his own suggestion rather than one based on any evidence of what would be required in practice to maintain the pool in safe condition. The only case relied on by Sir Geoffrey Vos C in this context, Dowty Boulton Paul Ltd v Wolverhampton Corpn (No 2) [1976] Ch 13, is of no assistance. The actual decision turned on other issues, so that anything said about the claimed easement was obiter. It seems to have been assumed that the disused airfield could be made suitable for the limited use to be made of it by the appellants by no more than mowing. On that basis Russell LJ was prepared to proceed on the assumption (p 24C D) that the right to use the airfield was capable of existing as an easement with the ancillary right to mow to make it useable. The case tells one nothing about the view that would have been reached if the right had been claimed over an operational, commercial airfield. The appellants raise a related problem concerning the element of choice. In respect of a right of way over a strip of land, or even over a bridge, there is no doubt about what is required by way of step in rights. Here there is no such clarity. As submitted in their case: A right to enjoy facilities being run by the servient owner is defined by the active choice and implementation of the servient owner. It chooses the location of the bunkers, the layout of the gardens from time to time, the temperature and depth of the water in the pool no less than it chooses the menu in the restaurant, the range of equipment in the gym and the loudness of the music within it. There is no right in the dominant owner to exercise its right in any different, or any particular way. The scope of the right is defined by the active choices and implementation of the servient owner from time to time. This perhaps is a less strong point in respect of the swimming pool, the physical characteristics of which are clearly defined, and unlikely to change. However, in respect of the golf course it seems to me unanswerable. It is true that in Ellenborough Park the use was to some extent subject to decisions made by the servient owner as to the layout of the garden, and included the possibility of some sporting activity. The use was described by Evershed MR: The enjoyment contemplated was the enjoyment of the vendors ornamental garden in its physical state as such the right, that is to say, of walking on or over those parts provided for such purpose, that is, pathways and (subject to restrictions in the ordinary course in the interest of the grass) the lawns; to rest in or upon the seats or other places provided; and, if certain parts were set apart for particular recreations such as tennis or bowls, to use those parts for those purposes, subject again, in the ordinary course, to the provisions made for their regulation; but not to trample at will all over the park, to cut or pluck the flowers or shrubs, or to interfere in the laying out or upkeep of the park (p 168) However, these matters seem to have been treated as no more than incidental to the enjoyment of the garden as a place for walking, rather than as here essential to the purpose of the grant. Further, the enjoyment was subject to the dominant owners obligation to contribute to the cost of maintenance, and there was no discussion of what might happen in the event of failure to maintain. The court was not faced, as in this case, with the commercially incoherent position that the dominant owner is under no obligation to operate and maintain the recreational facilities which are essential to the grant, but has no right to recover the costs if he does so. I also find it difficult to see the limits of the majoritys approach. One could imagine, for example, similar time share apartments built on a theme park, and offering free access to the various rides on the park. It would I think be quite clear that the rides and other attractions could not be sensibly and safely enjoyed without active management and supervision of their owner. In theory, no doubt, if the owner defaulted, the dominant tenants could form their own management company and take over the running of the park. But it would in my view be unarguable that such a right could take effect as an easement or property interest. I accept that are some elements of the recreational facilities, notably the Italianate gardens, which lend themselves much more readily to a traditional understanding of an easement. However, like the majority, and in disagreement with the Court of Appeal, I would be inclined to regard this as a composite package of rights which stands or falls as a whole. Since I am in a minority it is unnecessary to pursue that issue further. It is also unnecessary to consider further the issues relating to the claimed quantum meruit. Finally, I comment briefly on the issues raised by the post hearing exchanges in connection with the rule against perpetuities (Lord Briggs paras 27ff). These arose from the interest shown by some members of this court in the question of future facilities. The background as I understand it is as follows. The judge held that the rights extended not only to recreational facilities existing at the date of grant, but to future replacements or additions. He said: There is nothing vague or of excessive width in the present rights. They clearly extend to all recreational and sporting facilities on the estate, and to the gardens, and must in my judgment include facilities that were not there or planned in 1981, or which may have been significantly improved since then. To construe the rights as limited to the actual facilities which were on site or planned in 1981 is unrealistic and might inhibit the servient owner from introducing improvements or replacements or adding facilities which would be for everyones benefit (para 44) In this passage he seems to have gone beyond the case as advanced at trial by the present respondents. Although their pleadings had asserted rights over any sporting or recreational facilities which may from time to time be provided on the Broome Park Estate, their case at trial was more limited. The right was said to extend to facilities existing at the date of grant, and to later facilities constructed either in direct substitution for existing facilities, or as extensions of them. In the Court of Appeal the present respondents supported the judges view, but there seems to have been some doubt as to how far it went. In their submission, as understood by the court, the grant would not extend to wholly new facilities on a part of the estate where none had previously existed, but would include, for example, an extension onto new land of the golf course (para 36). The court took a more limited view: The question of whether a minor or de minimis extension to the land used by the existing or replacement facilities does not arise on the facts of this case. But we would be inclined to accept that such an incremental increase in the land used by the golf course or, say, a small extension to the existing land used by the swimming pool or to the run back used by the tennis courts, would be covered on the proper construction of the grant. A completely new facility on new ground would not be covered, but a replacement facility, even one that had been slightly extended beyond the ground used by the original facility, would be. (para 44) The appellants submissions support this limited view. I note three points in particular. Firstly, they rely on the ordinary construction of the words of the grant which are expressed in the present tense, and say nothing about future facilities. They contrast para 2 which refers in terms to pipes and drains now in the land or constructed within 80 years of the date hereof. Secondly, they point out that the Transferors adjoining estate (the expression used in the grant) extends to a large area (some 90 acres) of mainly agricultural land. It cannot sensibly have been intended that this large area would be burdened for ever with rights to future recreational facilities created anywhere at any time in the future. Thirdly, such a construction would come into direct conflict with the rule against perpetuities. As they point out, there is authority for the proposition that the rule is not offended by a right which may allow for future substitutions (see eg Dunn v Blackdown Properties Ltd [1961] Ch 433, 440 per Cross J), but none for a right over wholly new facilities which may be created anywhere over an area of this size. I see considerable force in all these points. Although it is not necessary for the purposes of this appeal to reach a definitive view on the future extent of the grant, the Court of Appeal were right in my view to construe it narrowly. Lord Briggs seeks to avoid the problem by treating the grant as limited to the leisure complex. However, that is not what the document says, nor indeed is it clear precisely what physical area would be so defined. For these reasons, in respectful disagreement with the majority, I would have allowed the appeal.

Broome Park is a substantial country estate near Canterbury. It originally included the Mansion House, Elham House and surrounding lands. In 1967, Elham House and adjoining land were conveyed away. This is the alleged dominant tenement of the disputed easement. The seller retained the rest of Broome Park, including the Mansion House (jointly the Park). This is the alleged servient tenement. In or before 1979, the Park was acquired by Gulf Investments Ltd (Gulf Investments) to develop a timeshare and leisure complex. The key features were the creation of: (i) timeshare apartments in the Mansion House; (ii) a communal club house for the timeshare owners and other paying members of the public in the Mansion House, including restaurant, TV, billiards and gymnasium facilities; and (iii) sporting and recreational facilities in the surrounding grounds, including a full golf course, outdoor heated swimming pool, tennis and squash courts and formal gardens. The individual purchasers of timeshare units formed the Broome Park Owners Club (BPOC). They were indirectly granted free use of the communal and leisure facilities within the lower part of the Mansion House and its surrounding grounds by a lease to another Gulf company in August 1980. Following the initial success of the development, Elham House was re acquired in November 1980. Planning permission was obtained for the conversion and construction of 26 timeshare apartments using a freehold structure Regency Villas. By a transfer dated 11 November 1981, Gulf Investments transferred Elham House to an associated company (the 1981 Transfer). A further transfer took place on the following day, to a trustee for intended timeshare owners. Elham House was then held for the benefit of the Regency Villas Owners Club (RVOC) members. The grant of rights in the 1981 Transfer (the Facilities Grant) stated: the Transferee its successors in title its lessees and the occupiers from time to time of the property to use the swimming pool, golf course, squash courts, tennis courts, the ground and basement floors of the sporting or recreational facilities on the Transferors adjoining estate. Most of the relevant sporting and recreational facilities had been constructed by then. Subsequently, there was a reduction in the number of available facilities and a concern that they would deteriorate without contributions from the RVOC members. The swimming pool fell into disuse and was filled in by 2000. Other facilities, such as the putting green, croquet lawn, jacuzzi and roller skating rink, were closed and the riding stables were demolished. Further, from time to time, beginning in about 1983, the RVOC made voluntary contributions towards the cost of the facilities. When agreement about contributions broke down, the new owners of Broome Park denied that the RVOC timeshare owners had any enforceable rights as to the leisure complex, so that they could be charged for their use. The First Respondent (as freehold owner of Elham House) and the other Respondents (as individual RVOC timeshare members) claimed a declaration that they were entitled, under an easement, to free use of all the sporting and recreational facilities from time to time provided within the Park. They also sought an injunction restraining interference with their use of the facilities, and the return of sums paid for the use of the facilities since 2009, as damages for breach of the easement or by way of restitution. At trial before HHJ Purle QC, the Respondents succeeded in their claims, save recovery of payments for use of the facilities before 2012. In the Court of Appeal, they were again successful on the main issue about whether the Facilities Grant amounted to a grant of an easement. The judges decision was only reversed on matters of detail, such as the Respondents rights regarding a new swimming pool constructed in the basement of the Mansion House, which reduced the amount due. The Appellants succeeded in part in their counterclaim for quantum meruit. In the Supreme Court, the Appellants sought dismissal of all the claims and the Respondents sought restoration of the judges original order. A majority of the Supreme Court dismisses the appeal and allows the cross appeal. The judges consequential orders, including his order for monetary compensation for the payment under protest for use of the facilities in and after 2012, are restored. Lord Briggs, with whom Lady Hale, Lord Kerr and Lord Sumption agree, gives the main judgment. Lord Carnwath gives a dissenting judgment. Three main conclusions follow from the contextual factors relevant to construing the Facilities Grant [22 24]. First, the intention was to confer a property right in the form of an easement [25]. Secondly, the grant was of a single comprehensive right to use a complex of facilities as they evolved, not fixed in 1981 [26 29]. Thirdly, there is no express requirement for contribution to the operational costs [30]. The effect of In re Ellenborough Park [1956] Ch 131 (CA) the leading case on easements on the central question in this appeal, namely whether the Facilities Grant could not amount to an easement because it conferred recreational and sporting rights, is fully discussed [44 57]. Lord Briggs concludes that Ellenborough Park establishes that such a grant can amount to an easement [48, 52 53, 59]. Overall, the majority accepts that the grant of an easement in this case was novel, given the greater running costs and operational responsibilities, and that there are factors which tell against broad recognition of rights over such facilities as easements [75] [80]. Ultimately, however, the grant of purely recreational (including sporting) rights over land which genuinely accommodate adjacent land may be the subject matter of an easement, provided always that they satisfy the four well settled conditions for easements [81]. Where the actual or intended use of the dominant tenement is itself recreational, as is the norm for holiday timeshare developments, the accommodation condition will generally be satisfied by a recreational easement [81]. Regarding the fourth condition whether the right is capable of forming the subject matter of a grant other objections based on an ouster (the concern in this case being step in rights of the dominant owner) and mere passivity (the issue being alleged positive duties on the servient owner) are not accepted by the majority, because of concurrent factual findings by the courts below [60 73]. On the cross appeal, the majority holds that the Court of Appeal was wrong to limit the grant of rights to the facilities in existence at the time of the grant in 1981 [85, 92]. The sporting and recreational facilities referred to in the Facilities Grant were bound to change significantly over time [26, 86] and the new indoor swimming pool was, once complete, a facility made within the complex [88 92]. Lord Carnwaths dissenting judgment: Lord Carnwath considers that the intended enjoyment of the rights granted in this case, particularly as to the golf course and swimming pool, cannot be achieved without the active participation of the owner of those facilities in their provision, maintenance and management [95]. Thus, Lord Carnwath would not extend the Ellenborough Park principle to a full leisure complex. He considers that such an extension of the law on easements is wrong in principle and not supported by case law [96].

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On a Tuesday afternoon in July 2008 Mrs Elizabeth Robinson, described by the Recorder as a relatively frail lady then aged 76, was walking along Kirkgate, a shopping street in the centre of Huddersfield, when she was knocked over by a group of men who were struggling with one another. Two of the men were sturdily built police officers, and the third was a suspected drug dealer whom they were attempting to arrest. As they struggled, the men knocked into Mrs Robinson and they all fell to the ground, with Mrs Robinson underneath. She suffered injuries as a result. The principal question which has to be decided in this appeal is whether the officers owed a duty of care to Mrs Robinson. The other important question is whether, if they did, they were in breach of that duty. Mr Recorder Pimm held that the officers had been negligent, but that police officers engaged in the apprehension of criminals were immune from suit. The Court of Appeal held that no duty of care was owed, and that, even if the officers had owed Mrs Robinson such a duty, they had not acted in breach of it: [2014] EWCA Civ 15. As will appear, the simple facts of this case have given rise to proceedings raising issues of general importance. Most of those issues can be decided by applying long established principles of the law of negligence. The fact that the issues have reached this court reflects the extent to which those principles have been eroded in recent times by uncertainty and confusion. The facts The events leading to Mrs Robinsons accident began when DS Neil Willan spotted Mr Ashley Williams apparently dealing drugs in a park in the centre of Huddersfield. He did not attempt to arrest Williams immediately, as Williams was young and physically fit, and Willan thought that he was unlikely to be able to arrest him without his running away. He called for backup, and DC Ian Green and DS Damian Roebuck then made their way to join him. Williams went to a bookmakers on Kirkgate, and Willan followed him inside. He decided not to attempt an arrest inside the shop, as there were people there whom he recognised, and he was concerned that attempting an arrest would endanger both his own safety and that of the customers and staff. Williams then left the shop and stood outside it. Green and Roebuck then arrived, and another officer, PC Dhurmea, arrived soon afterwards. Like Willan, they were in plain clothes. Willan and Roebuck formed a plan to arrest Williams while he was standing outside the bookmakers. The plan involved Willan and Dhurmea approaching Williams from one direction, taking hold of him and effecting the arrest, while Roebuck and Green were positioned in the opposite direction, to prevent his escape and assist once Willan and Dhurmea had taken hold of him. Willan and Dhurmea positioned themselves up the street from the bookmakers, while Green and Roebuck took up a position some distance down the street. Kirkgate was moderately busy at the time with pedestrians and traffic. Mrs Robinson was one of a number of pedestrians walking along the pavement. She passed Willan and Dhurmea, and then Williams, very shortly after two other pedestrians. Almost immediately after she passed Williams, and when she was within a yard of him, Willan and Dhurmea approached him. Mrs Robinson was then in their line of sight. The officers took hold of Williams and attempted to arrest him. Williams resisted arrest. As the men tussled, they moved towards Mrs Robinson and collided with her. The initial contact was between her and Williams, who backed into her. She fell over, and the men fell on top of her. Roebuck and Green arrived three seconds later and assisted in arresting Williams. The proceedings before the Recorder Mrs Robinson issued proceedings for damages for personal injury, on the basis first of the negligence of the officers, and secondly assault and trespass to the person occasioned by DS Willan. The latter aspect of the claim is no longer in issue. Following a hearing on liability, the Recorder dismissed the claim. In relation to the facts, the Recorder relied on CCTV footage of the incident, together with the evidence of DS Willan, DS Roebuck and DC Green concerning the planning of the arrest. He accepted Willans evidence that the officers had identified the risk that Williams would try to run away, and regarded it as significant. Willan also said that he was aware of the potential for harm to members of the public if Williams tried to escape. His evidence was that in any situation it was necessary to consider the risk to those in the vicinity. He said that if it had appeared to him that someone was in harms way, he would have walked past Williams without effecting the arrest. The Recorder noted that that was in accordance with the risk assessment guidance provided to police officers in relation to arrests in drugs cases, to which he had been referred in the evidence. Willan said that he had not been aware of Mrs Robinsons presence when he attempted to arrest Williams. Willan also gave evidence that there was some urgency in effecting the arrest. He had seen Williams taking the drugs from a bag secured around his neck. It was important to arrest him while he still had drugs in his possession. Without the drugs, there was unlikely to be sufficient evidence for a successful prosecution. DS Roebuck said that it had taken him and DC Green about three seconds to get from the place where they had taken up position prior to the attempted arrest to the scene where the other three men were on top of Mrs Robinson. He said that suspects like Williams could have recognised them as police officers if they had been any closer. The Recorder did not accept that evidence, which was unsupported by any other evidence. As far as appeared from the evidence, Roebuck and Green would, he found, just have been two men walking along the street. In the light of the evidence, the Recorder found that the decision to arrest Williams at the time and place selected by the officers involved a foreseeable risk that Mrs Robinson would be injured. She was in very close proximity to Williams at that moment, she was an elderly lady, and there was a significant and foreseeable risk that he would try to escape. In the view of the Recorder, the officers had acted negligently. First, Willan accepted that he ought to have been taking care for the safety of members of the public in the vicinity. Although Mrs Robinson had just walked past Williams and was within a yard of him, Willan did not notice her. That was prima facie in breach of his duty of care. Secondly, in view of the known risk that Williams would try to escape, the officers could have waited and selected a safer opportunity to effect the arrest. Thirdly, there was a clear need for all four officers to be present if the arrest was to be carried out safely with pedestrians passing. Roebuck and Green had however been too far away to assist their colleagues until several seconds had passed. The risk could have been minimised if they had been closer at the time when the arrest was attempted. The Recorder held, however, that the decision in Hill v Chief Constable of West Yorkshire [1989] AC 53 had conferred on the police an immunity against claims in negligence. In the light of the decision of the Court of Appeal in Desmond v Chief Constable of Nottinghamshire Police [2011] EWCA Civ 3; [2011] PTSR 1369, that immunity was not confined to cases of omission. It therefore applied in the present case. The proceedings in the Court of Appeal In the Court of Appeal, Hallett LJ considered that the Caparo test [Caparo Industries plc v Dickman [1990] 2 AC 605, 617 618] applies to all claims in the modern law of negligence (para 40). In consequence, [t]he court will only impose a duty where it considers it right to do so on the facts (ibid). The general principle was that most claims against the police in negligence for their acts and omissions in the course of investigating and suppressing crime and apprehending offenders will fail the third stage of the Caparo test (para 46). That is to say, [i]t will not be fair, just and reasonable to impose a duty (ibid). That is because the courts have concluded that the interests of the public will not be best served by imposing a duty [on] to individuals (ibid). The answer to counsels rhetorical question, what would the public think if the police, in the process of arresting criminals, could injure innocent members of the public with impunity, was that provided the police act within reason, the public would prefer to see them doing their job and taking drug dealers off the street (para 47). One might observe that if the police are not under a duty of care, then it is irrelevant to the issue whether they act within reason or not. On the other hand, if they act with reasonable care, then they will not be in breach of a duty of care, even if an innocent member of the public is injured. Hallett LJ accepted that the authorities suggested that there might be a number of possible exceptions to the general principle: cases of outrageous negligence, cases which did not relate to core functions, and cases where police officers had assumed responsibility for a claimant. The present case did not fall into any of those categories. It was a paradigm example of why the courts are loath to impose a duty towards individual members of the public on the police engaged in their core functions (para 51). Hallett LJ added that, even if counsel for Mrs Robinson had been correct in her argument that there was no immunity from liability where police officers caused direct physical harm to members of the public, it was in any event clear that Williams was responsible for the harm. This was therefore a claim based on the officers failure to prevent Williams from harming Mrs Robinson: in the language used in other cases, it concerned an omission, rather than a positive act. Such a claim fell at the first hurdle: it was not fair, just or reasonable to impose liability on those facts. Furthermore, Hallett LJ considered that there was no proximity between Mrs Robinson and the police officers, notwithstanding that she had been injured when they fell on top of her. It was not enough to find that there was a reasonably foreseeable risk of her being physically injured in the course of carrying out the arrest. Hallett LJ also added that, had it been necessary, she would have felt obliged to overturn the Recorders finding of negligence. In that regard, she criticised him for acting as if he were an expert in the arrest and detention of suspects. In her own view, DS Willan could not afford to wait. He was bound to attempt the arrest or risk losing the suspect and the evidence. The delay of three seconds in the other two officers reaching the scene was hardly worthy of criticism. Arnold J delivered a concurring judgment, and Sullivan LJ agreed with Hallett LJ. The issues The issues arising from the judgments below and the parties submissions can be summarised as follows: (1) Does the existence of a duty of care always depend on the application of the Caparo test to the facts of the particular case? (2) Is there a general rule that the police are not under any duty of care when discharging their function of investigating and preventing crime? Or are the police generally under a duty of care to avoid causing reasonably foreseeable personal injuries, when such a duty would arise in accordance with ordinary principles of the law of negligence? If the latter is the position, does the law distinguish between acts and omissions: in particular, between causing injury, and protecting individuals from injury caused by the conduct of others? (3) positive act? (4) Did the police officers owe a duty of care to Mrs Robinson? (5) finding that the officers failed in that duty? (6) her injuries caused by that breach? If so, was the Court of Appeal entitled to overturn the Recorders If the latter is the position, is this an omissions case, or a case of a If there was a breach of a duty of care owed to Mrs Robinson, were (1) Caparo The proposition that there is a Caparo test which applies to all claims in the modern law of negligence, and that in consequence the court will only impose a duty of care where it considers it fair, just and reasonable to do so on the particular facts, is mistaken. As Lord Toulson pointed out in his landmark judgment in Michael v Chief Constable of South Wales Police (Refuge and others intervening) [2015] UKSC 2; [2015] AC 1732, para 106, that understanding of the case mistakes the whole point of Caparo, which was to repudiate the idea that there is a single test which can be applied in all cases in order to determine whether a duty of care exists, and instead to adopt an approach based, in the manner characteristic of the common law, on precedent, and on the development of the law incrementally and by analogy with established authorities. Caparo was decided in the aftermath of Lord Wilberforces attempt in Anns v Merton London Borough Council [1978] AC 728, 751 752 to lay down an approach which could be applied in all situations in order to determine the existence of a duty of care. That approach had two stages: first, it was necessary to decide whether there was a prima facie duty of care, based on the foreseeability of harm, and secondly, in order to place limits on the breadth of the first stage, it was necessary to consider whether there were reasons of public policy for excluding or restricting any such prima facie duty. That approach had major implications for public authorities, as they have a multitude of functions designed to protect members of the public from harm of one kind or another, with the consequence that the first stage enquiry was readily satisfied, and the only limit to liability became public policy. Anns led to a period during which the courts struggled to contain liability, particularly for economic loss unassociated with physical damage or personal injury, and for the acts and omissions of public authorities. Commenting extra judicially during that period, Lord Oliver of Aylmerton said that what has been seen as a principle of prima facie liability has been prayed in aid in subsequent cases to justify claims for damages which have become progressively more divorced from common sense and as placing on the defendant a burden, sometimes virtually insurmountable, of showing some good reason in policy why he should not be held liable: Judicial Legislation: Retreat from Anns, Third Sultan Azlan Shah Law Lecture (1988). It was in the context of the retreat from Anns that emphasis was placed in a number of cases on the concept of proximity, and on the idea that it must be fair to impose a duty of care on the defendant. In Caparo, Lord Bridge of Harwich noted that, since Anns, a series of decisions of the Privy Council and the House of Lords, notably in judgments and speeches delivered by Lord Keith of Kinkel (including his speech in Hill v Chief Constable of West Yorkshire), had emphasised the inability of any single general principle to provide a practical test which can be applied to every situation to determine whether a duty of care is owed and, if so, what is its scope (p 617). It is ironic that the immediately following passage in Lord Bridges speech has been treated as laying down such a test, despite, as Lord Toulson remarked in Michael, the pains which he took to make clear that it was not intended to be any such thing: What emerges [from the post Anns decisions] is that, in addition to the foreseeability of damage, necessary ingredients in any situation giving rise to a duty of care are that there should exist between the party owing the duty and the party to whom it is owed a relationship characterised by the law as one of proximity or neighbourhood and that the situation should be one in which the court considers it fair, just and reasonable that the law should impose a duty of a given scope upon the one party for the benefit of the other. But it is implicit in the passages referred to that the concepts of proximity and fairness embodied in these additional ingredients are not susceptible of any such precise definition as would be necessary to give them utility as practical tests, but amount in effect to little more than convenient labels to attach to the features of different specific situations which, on a detailed examination of all the circumstances, the law recognises pragmatically as giving rise to a duty of care of a given scope. (pp 617 618; emphasis added) Lord Bridge immediately went on to adopt an incremental approach, based on the use of established authorities to provide guidance as to how novel questions should be decided: I think the law has now moved in the direction of attaching greater significance to the more traditional categorisation of distinct and recognisable situations as guides to the existence, the scope and the limits of the varied duties of care which the law imposes. We must now, I think, recognise the wisdom of the words of Brennan J in the High Court of Australia in Sutherland Shire Council v Heyman (1985) 60 ALR 1, 43 44, where he said: It is preferable, in my view, that the law should develop novel categories of negligence incrementally and by analogy with established categories . (p 618) It was that approach, and not a supposed tripartite test, which Lord Bridge then proceeded to apply to the facts before him. Applying the approach adopted in Caparo, there are many situations in which it has been clearly established that a duty of care is or is not owed: for example, by motorists to other road users, by manufacturers to consumers, by employers to their employees, and by doctors to their patients. As Lord Browne Wilkinson explained in Barrett v Enfield London Borough Council [2001] 2 AC 550, 560, Once the decision is taken that, say, company auditors though liable to shareholders for negligent auditing are not liable to those proposing to invest in the company . that decision will apply to all future cases of the same kind. Where the existence or non existence of a duty of care has been established, a consideration of justice and reasonableness forms part of the basis on which the law has arrived at the relevant principles. It is therefore unnecessary and inappropriate to reconsider whether the existence of the duty is fair, just and reasonable (subject to the possibility that this court may be invited to depart from an established line of authority). Nor, a fortiori, can justice and reasonableness constitute a basis for discarding established principles and deciding each case according to what the court may regard as its broader merits. Such an approach would be a recipe for inconsistency and uncertainty, as Hobhouse LJ recognised in Perrett v Collins [1999] PNLR 77, 90 91: It is a truism to say that any case must be decided taking into account the circumstances of the case, but where those circumstances comply with established categories of liability, a defendant should not be allowed to seek to escape from liability by appealing to some vaguer concept of justice or fairness; the law cannot be re made for every case. Indeed, the previous authorities have by necessary implication held that it is fair, just and reasonable that the plaintiff should recover in the situations falling within the principles they have applied. It is normally only in a novel type of case, where established principles do not provide an answer, that the courts need to go beyond those principles in order to decide whether a duty of care should be recognised. Following Caparo, the characteristic approach of the common law in such situations is to develop incrementally and by analogy with established authority. The drawing of an analogy depends on identifying the legally significant features of the situations with which the earlier authorities were concerned. The courts also have to exercise judgement when deciding whether a duty of care should be recognised in a novel type of case. It is the exercise of judgement in those circumstances that involves consideration of what is fair, just and reasonable. As Lord Millett observed in McFarlane v Tayside Health Board [2000] 2 AC 59, 108, the court is concerned to maintain the coherence of the law and the avoidance of inappropriate distinctions if injustice is to be avoided in other cases. But it is also engaged in a search for justice, and this demands that the dispute be resolved in a way which is fair and reasonable and accords with ordinary notions of what is fit and proper. In the present case, Hallett LJ cited the decision of this court in Smith v Ministry of Defence (JUSTICE intervening) [2013] UKSC 41; [2014] AC 52 as an example of a decision in which there was a focus on the three ingredients mentioned by Lord Bridge. That was however a case raising a novel legal issue, relating to the provision of protective equipment to soldiers on active duty, and the scope of combat immunity: it did not concern an established category of liability. Hallett LJ also relied on a passage in the speech of Lord Steyn in Marc Rich & Co AG v Bishop Rock Marine Co Ltd [1996] AC 211, 235, in which he remarked that the elements of foreseeability and proximity as well as considerations of fairness, justice and reasonableness are relevant to all cases. That was a case concerned with the loss of a ship and its cargo as a result of negligent advice, in which the reasoning was essentially directed to considerations relevant to economic loss. As Hobhouse LJ observed in Perrett v Collins at p 92: Marc Rich should not be regarded as an authority which has a relevance to cases of personal injury or as adding any requirements that an injured plaintiff do more than bring his case within established principles. If a plaintiff is attempting to establish some novel principle of liability, then the situation would be different. It was in any event made clear in Michael that the idea that Caparo established a tripartite test is mistaken. Properly understood, Caparo thus achieves a balance between legal certainty and justice. In the ordinary run of cases, courts consider what has been decided previously and follow the precedents (unless it is necessary to consider whether the precedents should be departed from). In cases where the question whether a duty of care arises has not previously been decided, the courts will consider the closest analogies in the existing law, with a view to maintaining the coherence of the law and the avoidance of inappropriate distinctions. They will also weigh up the reasons for and against imposing liability, in order to decide whether the existence of a duty of care would be just and reasonable. In the present case, however, the court is not required to consider an extension of the law of negligence. All that is required is the application to particular circumstances of established principles governing liability for personal injuries. Addressing, then, the first of the issues identified in para 20 above, the existence of a duty of care does not depend on the application of a Caparo test to the facts of the particular case. In the present case, it depends on the application of established principles of the law of negligence. (2) The police (i) Public authorities in general Before focusing on the position of the police in particular, it may be helpful to consider the position of public authorities in general, as this is an area of the law of negligence which went through a period of confusion following the case of Anns, as explained in paras 22 23 above. That confusion has not yet entirely dissipated, as courts continue to cite authorities from that period without always appreciating the extent to which their reasoning has been superseded by the return to orthodoxy achieved first in Stovin v Wise [1996] AC 923 and then, more fully and clearly, in Gorringe v Calderdale Metropolitan Borough Council [2004] UKHL 15; [2004] 1 WLR 1057. At common law, public authorities are generally subject to the same liabilities in tort as private individuals and bodies: see, for example, Entick v Carrington (1765) 2 Wils KB 275 and Mersey Docks and Harbour Board v Gibbs (1866) LR 1 HL 93. Dicey famously stated that every official, from the Prime Minister down to a constable or collector of taxes, is under the same responsibility for every act done without legal justification as any other citizen: Introduction to the Study of the Law of the Constitution 3rd ed (1889), p 181. An important exception at common law was the Crown, but that exception was addressed by the Crown Proceedings Act 1947, section 2. Accordingly, if conduct would be tortious if committed by a private person or body, it is generally equally tortious if committed by a public authority: see, for example, Dorset Yacht Co Ltd v Home Office [1970] AC 1004, as explained in Gorringe, para 39. That general principle is subject to the possibility that the common law or statute may provide otherwise, for example by authorising the conduct in question: Geddis v Proprietors of Bann Reservoir (1878) 3 App Cas 430. It follows that public authorities are generally under a duty of care to avoid causing actionable harm in situations where a duty of care would arise under ordinary principles of the law of negligence, unless the law provides otherwise. On the other hand, public authorities, like private individuals and bodies, are generally under no duty of care to prevent the occurrence of harm: as Lord Toulson stated in Michael, the common law does not generally impose liability for pure omissions (para 97). This omissions principle has been helpfully summarised by Tofaris and Steel, Negligence Liability for Omissions and the Police (2016) 75 CLJ 128: In the tort of negligence, a person A is not under a duty to take care to prevent harm occurring to person B through a source of danger not created by A unless (i) A has assumed a responsibility to protect B from that danger, (ii) A has done something which prevents another from protecting B from that danger, (iii) A has a special level of control over that source of danger, or (iv) As status creates an obligation to protect B from that danger. As that summary makes clear, there are certain circumstances in which public authorities, like private individuals and bodies, can come under a duty of care to prevent the occurrence of harm: see, for example, Barrett v Enfield London Borough Council and Phelps v Hillingdon London Borough Council [2001] 2 AC 619, as explained in Gorringe at paras 39 40. In the absence of such circumstances, however, public authorities generally owe no duty of care towards individuals to confer a benefit upon them by protecting them from harm, any more than would a private individual or body: see, for example, Smith v Littlewoods Organisation Ltd [1987] AC 241, concerning a private body, applied in Mitchell v Glasgow City Council [2009] UKHL 11; [2009] AC 874, concerning a public authority. That is so, notwithstanding that a public authority may have statutory powers or duties enabling or requiring it to prevent the harm in question. A well known illustration of that principle is the decision of the House of Lords in East Suffolk Rivers Catchment Board v Kent [1941] AC 74. The position is different if, on its true construction, the statutory power or duty is intended to give rise to a duty to individual members of the public which is enforceable by means of a private right of action. If, however, the statute does not create a private right of action, then it would be, to say the least, unusual if the mere existence of the statutory duty [or, a fortiori, a statutory power] could generate a common law duty of care: Gorringe, para 23. A further point, closely related to the last, is that public authorities, like private individuals and bodies, generally owe no duty of care towards individuals to prevent them from being harmed by the conduct of a third party: see, for example, Smith v Littlewoods Organisation Ltd and Mitchell v Glasgow City Council. In Michael, Lord Toulson explained the point in this way: It is one thing to require a person who embarks on action which may harm others to exercise care. It is another matter to hold a person liable in damages for failing to prevent harm caused by someone else. (para 97) There are however circumstances where such a duty may be owed, as Tofaris and Steele indicated in the passage quoted above. They include circumstances where the public authority has created a danger of harm which would not otherwise have existed, or has assumed a responsibility for an individuals safety on which the individual has relied. The first type of situation is illustrated by Dorset Yacht, and in relation to the police by the case of Attorney General of the British Virgin Islands v Hartwell [2004] 1 WLR 1273, discussed below. The second type of situation is illustrated, in relation to the police, by the case of An Informer v A Chief Constable [2013] QB 579, as explained in Michael at para 69. In Anns, however, it was decided that a local authority owed a duty of care at common law, when exercising its power to inspect building works, to protect the ultimate occupier of the building from loss resulting from defects in its construction. The House of Lords thus held a public authority liable at common law for a careless failure to confer a benefit, by preventing harm caused by another persons conduct, in the absence of any special circumstances such as an assumption of responsibility towards the claimant. It added to the confusion by importing public law concepts, and the American distinction between policy and operational decisions, into questions concerning duties arising under the law of obligations. Although the decision was overruled in Murphy v Brentwood District Council [1991] 1 AC 398 on a limited basis (relating to the categorisation of the type of harm involved), its reasoning in relation to these matters was not finally disapproved until Stovin v Wise. The position was clarified in Gorringe v Calderdale Metropolitan Borough Council, which made it clear that the principle which had been applied in Stovin v Wise in relation to a statutory duty was also applicable to statutory powers. Lord Hoffmann (with whom Lord Scott of Foscote, Lord Rodger of Earlsferry and Lord Brown of Eaton under Heywood agreed) said that he found it difficult to imagine a case in which a common law duty could be founded simply on the failure, however irrational, to provide some benefit which a public authority had power (or a public law duty) to provide (para 32). He was careful to distinguish that situation from cases where a public authority did acts or entered into relationships or undertook responsibilities giving rise to a duty of care on an orthodox common law foundation (para 38). However, until the reasoning in Anns was repudiated, it was not possible to justify a rejection of liability, where a prima facie duty of care arose at the first stage of the analysis from the foreseeability of harm, on the basis that public bodies are not generally liable for failing to exercise their statutory powers or duties so as to confer the benefit of protection from harm. Instead, it was necessary to have recourse to public policy in order to justify the rejection of liability at the second stage. That was accordingly the approach adopted by the House of Lords and the Court of Appeal in a series of judgments, including Hill. The need to have recourse to public policy for that purpose has been superseded by the return to orthodoxy in Gorringe. Since that case, a public authoritys non liability for the consequences of an omission can generally be justified on the basis that the omissions principle is a general principle of the law of negligence, and the law of negligence generally applies to public authorities in the same way that it applies to private individuals and bodies. Equally, concerns about public policy cannot in themselves override a liability which would arise at common law for a positive act carried out in the course of performing a statutory function: the true question is whether, properly construed, the statute excludes the liability which would otherwise arise: see Gorringe at para 38 per Lord Hoffmann. That is not to deny that what might be described as policy considerations sometimes have a role to play in the law of negligence. As explained earlier, where established principles do not provide a clear answer to the question whether a duty of care should be recognised in a novel situation, the court will have to consider whether its recognition would be just and reasonable. (ii) The police in particular Turning to consider specifically the position of the police (helpfully discussed in Purshouse, Arrested development: Police negligence and the Caparo test for duty of care (2016) Torts Law Journal 1), Lord Toulson explained in the case of Michael at paras 29 35 that the police owe a duty to the public at large for the prevention of violence and disorder. That public law duty has a number of legal consequences. For example, the police cannot lawfully charge members of the public for performing their duty (Glasbrook Bros Ltd v Glamorgan County Council [1925] AC 270), and a police officer who wilfully fails to perform his duty may be guilty of a criminal offence (R v Dytham [1979] QB 722). Some members of the public may have standing to enforce the duty, for example in proceedings for judicial review (R v Commissioner of Police of the Metropolis, Ex p Blackburn [1968] 2 QB 118), but in doing so they are not enforcing a duty owed to them as individuals. In relation to the question whether, and in what circumstances, a private law duty of care might be owed by the police to particular individuals, Lord Toulson discussed in Michael the case of Hill, and in particular the speech of Lord Keith, with whom Lord Brandon of Oakbrook, Lord Oliver and Lord Goff of Chieveley agreed. Since it is apparent from the judgments below in the present proceedings, and from the submissions to this court, that Lord Keiths reasoning continues to be misunderstood, it is necessary to consider it once more. For the purposes of the present case, the most important aspect of Lord Keiths speech in Hill is that, in the words of Lord Toulson (Michael, para 37), he recognised that the general law of tort applies as much to the police as to anyone else. What Lord Keith said was this: There is no question that a police officer, like anyone else, may be liable in tort to a person who is injured as a direct result of his acts or omissions. So he may be liable in damages for assault, unlawful arrest, wrongful imprisonment and malicious prosecution, and also for negligence. (p 59; emphasis supplied) The words like anyone else are important. They indicate that the police are subject to liability for causing personal injury in accordance with the general law of tort. That is as one would expect, given the general position of public authorities as explained in paras 32 33 above. Lord Keiths dictum is vouched by numerous authorities. Those which he cited were Knightley v Johns [1982] 1 WLR 349, where a police officer who attended the scene of a road accident carelessly created an unnecessary danger to the claimant, and Rigby v Chief Constable of Northamptonshire [1985] 1 WLR 1242, where police officers attending a siege at a gunsmith's shop, where a psychopathic intruder had armed himself and was firing from the building, carelessly caused damage to the premises in the course of an attempt to end the siege, by firing a CS gas canister into the building in the absence of fire fighting equipment. That decision, cited with approval in Hill and in later authorities, is inconsistent with any supposed rule that the police owe no duty of care in respect of action taken in the course of suppressing crime. Lord Keith also referred to the decision in Dorset Yacht, where prison officers who brought young offenders on to an island and then left them unsupervised, when it was reasonably foreseeable that they would attempt to escape, and in doing so cause damage to property, were held to be in breach of a duty of care. Other examples concerning the police include Attorney General of the British Virgin Islands v Hartwell, where police authorities were held to have been negligent in entrusting a firearm to an officer who was still on probation and had shown signs of mental instability, and cases such as Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455, in which police forces, although not technically employers, have been treated as owing the same common law duty as employers to take reasonable care for the safety of their officers. There are also numerous cases concerned with road accidents involving police cars, such as Marshall v Osmond [1983] QB 1034, where Sir John Donaldson MR observed that the duty owed by a police driver to a suspected criminal whom he was pursuing was the same duty as that owed to anyone else, namely to exercise such care and skill as is reasonable in the circumstances. One might also mention Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310, where the House of Lords accepted, applying principles developed in cases concerning private individuals and bodies, that a duty of care was owed by the police, when they were responsible for crowd control at a football match, to persons who suffered psychiatric injuries as a result of deaths and injuries sustained by members of the crowd, subject to those persons being sufficiently proximate in time and space to the incident, and to their having a sufficiently close relationship to the dead and injured. These cases are not anomalous exceptions to the general absence of a duty of care, and cannot all be explained as falling within particular categories of the kind listed by Hallett LJ in the present case: cases of outrageous negligence, cases which did not relate to core functions, and cases where police officers had assumed responsibility for a claimant. The cases of Rigby v Chief Constable of Northamptonshire and Marshall v Osmond, for example, are plainly inconsistent with any supposed rule that the police owe no duty of care when engaged in their core operational activities, or that outrageous negligence or an assumption of responsibility must be established. On the contrary, these cases are examples of the application to the police of the ordinary common law duty of care to avoid causing reasonably foreseeable injury to persons and reasonably foreseeable damage to property. There are also examples concerned with other torts, such as Ashley v Chief Constable of Sussex Police (Sherwood intervening) [2008] AC 962, where relatives of a suspected drug dealer who had been shot dead by a police officer during a raid were held to have a cause of action for damages for battery (liability for negligence having been conceded), Minio Paluello v Commissioner of Police of the Metropolis [2011] EWHC 3411 (QB), where a protestor who suffered serious injuries when being pulled up from the ground by a police officer with excessive force was found entitled to damages for assault, and McDonnell v Commissioner of Police of the Metropolis [2015] EWCA Civ 573, where a claim for damages by a suspected drug dealer for assault arising from the use of excessive force during his arrest failed only on its facts. On the other hand, as Lord Toulson noted in Michael (para 37), Lord Keith held that the general duty of the police to enforce the law did not carry with it a private law duty towards individual members of the public. In particular, police officers investigating a series of murders did not owe a duty to the murderers potential future victims to take reasonable care to apprehend him. That was again in accordance with the general law of negligence. As explained earlier, the common law does not normally impose liability for omissions, or more particularly for a failure to prevent harm caused by the conduct of third parties. Public authorities are not, therefore, generally under a duty of care to provide a benefit to individuals through the performance of their public duties, in the absence of special circumstances such as an assumption of responsibility. This was recognised by Lord Toulson in Michael. As he explained: The refusal of the courts to impose a private law duty on the police to exercise reasonable care to safeguard victims or potential victims of crime, except in cases where there has been a representation and reliance, does not involve giving special treatment to the police . The question is therefore not whether the police should have special immunity, but whether an exception should be made to the ordinary application of common law principles. (paras 115 116) As previously explained, however, the reasoning by which Lord Keith arrived at the same conclusion as Lord Toulson reflects the period during which the case was decided, when Anns continued to be influential. Following the two stage approach to liability set out in Anns, Lord Keith considered first the argument that a duty of care arose in consequence of the foreseeability of harm to potential victims if the murderer was not apprehended. In that regard, Lord Keith emphasised that the foreseeability of harm was not in itself a sufficient basis for the imposition of a duty of care, and introduced the concept of proximity as a further ingredient. He concluded that there was no ingredient or characteristic giving rise to the necessary proximity between the police and the claimants daughter (who was one of the murderers victims), and that the circumstances of the case were not capable of establishing a duty of care owed towards her by the police. As Lord Toulson remarked in Michael (para 42), if Lord Keith had stopped at that point, it is unlikely that the decision would have caused controversy. However, having observed that what he had said was sufficient for the disposal of the appeal, Lord Keith went on to discuss the application of the second stage of the approach laid down in Anns: namely, whether there were reasons of public policy why an action should not lie in circumstances such as those of the present case (p 63). He concluded that there were such reasons, and expressed the view that the Court of Appeal had been right to take the view that the police were immune from an action of this kind (pp 63 64). It is important to note that this part of Lord Keiths speech was unrelated to a determination of whether the police were liable for negligence resulting in personal injury, where anyone else would be subject to liability under ordinary principles of the law of tort. He had already confirmed the existence of liability in those circumstances, as explained at paras 45 46 above. His comments about public policy were concerned with a different question, namely whether the police generally owe a duty of care to individual members of the public, in the performance of their investigative function, to protect them from harm caused by criminals: a question to which, on the principles established prior to Anns and subsequently reinstated in Stovin v Wise, Gorringe and Michael, as explained in paras 34 37 and 39 above, the answer was plainly no. In relation to that issue, the decision in Hill has now to be understood in the light of the later authorities. In Michael, in particular, Lord Toulson (with whom Lord Neuberger, Lord Mance, Lord Hodge and I agreed) reached the same conclusion as in Hill, but did so primarily by applying the reasoning in Stovin v Wise and Gorringe. Policy arguments were considered when addressing the argument that the court should create a new duty of care as an exception to the ordinary application of common law principles (see, in particular, paras 116 118). Lord Toulson concluded that, in the absence of special circumstances, there is no liability in cases of pure omission by the police to perform their duty for the prevention of violence (para 130). The case of Hill is not, therefore, authority for the proposition that the police enjoy a general immunity from suit in respect of anything done by them in the course of investigating or preventing crime. On the contrary, the liability of the police for negligence or other tortious conduct resulting in personal injury, where liability would arise under ordinary principles of the law of tort, was expressly confirmed. Lord Keith spoke of an immunity, meaning the absence of a duty of care, only in relation to the protection of the public from harm through the performance by the police of their function of investigating crime. Arguing against that conclusion, counsel for the respondents relied particularly on five authorities as supporting the existence of a general immunity. The first was the decision of the House of Lords in Calveley v Chief Constable of the Merseyside Police [1989] AC 1228, in which police officers who had been suspended pending the completion of disciplinary proceedings sought damages in respect of an alleged failure to conduct the proceedings expeditiously. They claimed to have suffered damage to their reputation, depression, and a loss of earnings. They alleged that they were owed a duty by the investigating officers to exercise proper care and expedition in the conduct of the investigation. It was argued that a police officer investigating a suspected crime owes a duty of care to the suspect and that the same principle applied to the investigation of a disciplinary offence. The House of Lords rejected the argument. Lord Bridge pointed out that the claims in negligence foundered on the rocks of elementary principle (p 1238). The losses claimed, so far as non financial, were not reasonably foreseeable, and the financial claims ran up against the formidable obstacles in the way of liability in negligence for purely economic loss. Lord Bridge added that all other considerations apart, it would be contrary to public policy to prejudice the fearless and efficient discharge by police officers of their vitally important public duty of investigating crime by requiring them to act under the shadow of a potential action for damages for negligence by the suspect. Reliance was placed on the latter dictum, but it is of no assistance to the respondent in the present case. Lord Bridges remark has to be understood in its context. The case sought to establish a novel type of liability relating to the manner in which an investigation was conducted. Lord Bridges reference to policy considerations was directed to that claim: he was not addressing the question whether the police may owe a duty of care to avoid causing reasonably foreseeable physical injury in the course of their operations. The second authority relied on was the judgment of Steyn LJ in Elguzouli Daf v Commissioner of Police of the Metropolis [1995] QB 335. The issue in the appeal was whether the Crown Prosecution Service owed a duty of care to a person it was prosecuting to act with reasonable diligence in obtaining and acting on scientific evidence which showed him to be innocent. The Court of Appeal held that no such duty was owed. Steyn LJ observed that the question raised was a novel one, which in the light of Caparo had to be considered by analogy with established categories of liability. In that regard, the case of Hill was considered instructive. Steyn LJ noted that the issue in that case was whether a claim against the police for a negligent failure to apprehend a violent criminal was sustainable. He summarised the effect of the second part of Lord Keiths speech as being that the House of Lords further held, as a second and separate ground of decision, that as a matter of public policy the police were immune from actions of negligence in respect of their activities in the investigation and suppression of crime (p 347). Steyn LJ added that it did not follow that the police might not be liable where there was some form of assumption of responsibility. The decision in Elguzouli Daf has been cited with approval on many occasions, and its correctness was recently confirmed by this court in SXH v Crown Prosecution Service (United Nations High Commissioner for Refugees intervening) [2017] UKSC 30; [2017] 1 WLR 1401. But Steyn LJs summary of the effect of the second part of Lord Keiths speech in Hill might convey a misleading impression if taken out of context. Steyn LJ can hardly have meant that the police enjoyed a blanket immunity in respect of anything done in the course of their activities in the investigation and suppression of crime, given his reliance on Lord Keiths speech in Hill. As already explained, Lord Keith confirmed the liability of the police for personal injuries in accordance with the ordinary law of tort, and cited the decision in Rigby v Chief Constable of Northamptonshire with approval. Thirdly, reliance was placed on the speech of Lord Steyn in Brooks v Commissioner of Police of the Metropolis [2005] UKHL 24; [2005] 1 WLR 1495. In that case, the claimant sought damages in respect of a psychiatric illness which he claimed to have suffered in consequence of his insensitive treatment by officers investigating an incident in which he had been assaulted and a friend of his had been murdered. The issue before the House of Lords was whether it was arguable that the police owed him a duty of care (a) to take reasonable steps to assess whether he was a victim of crime and, if so, to accord him reasonably appropriate protection and support, (b) to take reasonable steps to afford him the protection, assistance and support commonly afforded to a key eye witness to a serious crime of violence, and (c) to afford reasonable weight to the account given by him and to act on the account accordingly. The House held that it was not. The correctness of that conclusion is not in question. On ordinary principles, behaviour which is merely insensitive is not normally actionable, even if it results in a psychiatric illness. Lord Steyn recognised that this was a novel type of claim, to which Lord Bridges observations in Caparo applied. As in Elguzouli Daf, he based his approach to the question whether it would be right to recognise a duty of care of the kind alleged on Lord Keiths speech in Hill. He cited first Lord Keiths confirmation of the liability of the police for the negligent infliction of personal injuries in accordance with the general law of tort. He went on to cite the part of Lord Keiths speech concerning whether the police owed a duty of care to future victims in the performance of their investigative function. In the passage on which reliance was placed, he stated (para 30): A retreat from the principle in Hills case would have detrimental effects for law enforcement. Whilst focusing on investigating crime, and the arrest of suspects, police officers would in practice be required to ensure that in every contact with a potential witness or a potential victim time and resources were deployed to avoid the risk of causing harm or offence. Such legal duties would tend to inhibit a robust approach in assessing a person as a possible suspect, witness or victim. By placing general duties of care on the police to victims and witnesses the polices ability to perform their public functions in the interests of the community, fearlessly and with despatch, would be impeded. It would, as was recognised in Hills case, be bound to lead to an unduly defensive approach in combating crime. As Lord Toulson noted in Michael, by endorsing the principle in the Hill case in the terms that he did, Lord Steyn confirmed that the functions of the police which he identified were public law duties and did not give rise to private law duties of care in the absence of special circumstances, such as an assumption of responsibility. Nothing in his reasoning is inconsistent with the existence of a duty of care to avoid causing physical harm in accordance with ordinary principles of the law of negligence. Lord Steyn plainly had no intention of undermining the confirmation in Hill that the police were under such a duty of care. The passage cited was directed towards a different issue. Fourthly, reliance was placed on Smith v Chief Constable of Sussex Police [2008] UKHL 50; [2009] AC 225, one of two appeals which the House of Lords heard together, the other being Van Colle v Chief Constable of the Herefordshire Police (Secretary of State for the Home Department intervening). The case of Smith concerned the question whether, where a person had informed the police that he had received threats of violence, the police then owed him a duty of care to prevent the threats from being carried out. Applying the established principles discussed earlier, the answer was no, in the absence of special circumstances such as an assumption of responsibility, and the House of Lords so held. The House was not however referred to the line of authority including East Suffolk Rivers Catchment Board v Kent, Stovin v Wise and Gorringe, which would have provided a basis for deciding the case; nor did it rely on the equivalent body of authority concerned with omissions by private individuals and bodies, such as Smith v Littlewoods Organisation Ltd. Those were the bases on which a very similar issue was subsequently decided in Michael. In Smith v Chief Constable of Sussex Police, the majority of the House were in agreement that, absent special circumstances such as an assumption of responsibility, the police owed no duty of care to individuals affected by the discharge of their public duty to investigate offences and prevent their commission. Lord Hope, with whose reasoning the other members of the majority agreed, followed the approach adopted in Brooks in the passage cited in para 61 above, and emphasised the risk that the imposition of a duty of care of the kind contended for would inhibit a robust approach in assessing a person as a possible suspect or victim. He acknowledged that [t]here are, of course, cases in which actions of the police give rise to civil claims in negligence in accordance with ordinary delictual principles, and cited Rigby as an example (para 79). Lord Phillips of Worth Matravers CJ summarised the core principle to be derived from Hill and Brooks as being that in the absence of special circumstances, the police owe no common law duty of care to protect individuals against harm caused by criminals. Lord Brown approached the matter in a similar way, concluding that, in the absence of an assumption of responsibility towards the eventual victim, the police generally owe no duty of care to prevent injuries deliberately inflicted by third parties, when they are engaged in discharging their general duty of combating and investigating crime. None of the speeches is inconsistent with the existence of a duty of care to avoid causing physical harm in accordance with ordinary principles of the law of negligence. Fifthly, reliance was placed on the judgment of the Court of Appeal, delivered by Sir Anthony May P, in Desmond v Chief Constable of Nottinghamshire Police. The issue in the case was whether the chief constable owed a duty of care when providing information to the criminal records bureau about the claimant, so as to enable the bureau to respond to a request for an enhanced criminal record certificate, made in connection with a job application. The chief constable was under a statutory duty to provide such information as was in his opinion relevant and ought to be included in the certificate. It was argued that the chief constable had made an error of judgement in deciding that certain information was relevant and ought to be included, with the result that the job application had been unsuccessful. The claim was for damages in respect of financial loss, stress and anxiety. The court correctly identified the relevant legal principles as being those laid down in East Suffolk River Catchment Board v Kent, Stovin v Wise and Gorringe, and concluded that no duty of care was owed. Reliance was however placed by counsel on an earlier part of the judgment, in which the court considered the cases on which the judge below had based his approach Hill, Elguzouli Daf, Brooks, and Smith v Chief Constable of Sussex Police and explained why, in its view, they did not provide an answer to the case at hand. The court summarised the principle to be derived from those decisions as being that in the absence of special circumstances, the police and the Crown Prosecution Service do not generally in the interests of the whole community owe individual members of the public, be they victims, witnesses or those who are prosecuted, a common law duty of care in undertaking and performing their operational duties of investigating, detecting, suppressing and prosecuting crime (para 31). The court went on to state that that principle might not apply in exceptional circumstances at the margins; to an ordinary case where, for instance, in a road accident the police cause personal injury or physical damage by negligent driving; nor to cases where on particular facts a police officer is taken to have assumed responsibility to an individual claimant (para 32). That summary of the law appears to treat the police as being generally under no duty of care when undertaking and performing their operational duties, other than in special circumstances. It does not reflect the acceptance of the House of Lords in Hill, reflected also in later cases such as Frost, Alcock and Smith v Chief Constable of Sussex Police, that the police are generally under a duty of care to avoid causing personal injury where such a duty would arise according to ordinary principles of the law of negligence. Nor can a case such as Rigby be distinguished as an exceptional case at the margins: it was treated both in Hill and in Smith v Chief Constable of Sussex Police not as an anomaly, but as an instance of a wider principle. In short, while it is not suggested in the present case that the decision in Desmond was wrong, the particular passage relied on is not an accurate summary of the law. On examination, therefore, there is nothing in the ratio of any of the authorities relied on by the respondent which is inconsistent with the police being under a liability for negligence resulting in personal injuries where such liability would arise under ordinary principles of the law of tort. That is so notwithstanding the existence of some dicta which might be read as suggesting the contrary. points made by Lord Hughes in his judgment: In relation to this discussion, it is necessary to respond briefly to some of the 1. I do not suggest that the discussion of policy considerations in cases such as Hill, Brooks and Smith should be consigned to history. But it is important to understand that such discussions are not a routine aspect of deciding cases in the law of negligence, and are unnecessary when existing principles provide a clear basis for the decision, as in the present appeal. I would not agree with Lord Hughess statement that they are the ultimate reason why there is no duty of care towards victims, suspects or witnesses imposed on police officers engaged in the investigation and prevention of crime. The absence of a duty towards victims of crime, for example, does not depend merely on a policy devised by a recent generation of judges in relation to policing: it is based on the application of a general and long established principle that the common law imposes no liability to protect persons against harm caused by third parties, in the absence of a recognised exception such as a voluntary assumption of responsibility. 2. The courts are not policy making bodies in the sense in which that can be said of the Law Commission or government departments. But the exercise of judgement about the potential consequences of a decision has a part to play when the court is asked to decide whether a novel duty of care exists, together with a consideration of existing principles and of the need for the law to develop coherently and incrementally: see para 24 above. 3. Hill, Brooks and Smith were all cases in which novel types of claim were made. Hill was also decided at a time when, following Anns, policy arguments were particularly prominent in judicial reasoning, and when the principle in East Suffolk Rivers Catchment Board, which could otherwise have provided a solution, had been rejected. Brooks and Smith were cases in which existing principles pointed strongly towards the rejection of a duty of care, but since those principles were challenged or argued to be subject to exceptions which would accommodate the instant case, it is entirely understandable that the House of Lords referred to policy considerations as supporting their conclusion. 4. The distinction between careless acts causing personal injury, for which the law generally imposes liability, and careless omissions to prevent acts (by other agencies) causing personal injury, for which the common law generally imposes no liability, is not a mere alternative to policy based reasoning, but is inherent in the nature of the tort of negligence. For the same reason, although the distinction, like any other distinction, can be difficult to draw in borderline cases, it is of fundamental importance. The central point is that the law of negligence generally imposes duties not to cause harm to other people or their property: it does not generally impose duties to provide them with benefits (including the prevention of harm caused by other agencies). Duties to provide benefits are, in general, voluntarily undertaken rather than being imposed by the common law, and are typically within the domain of contract, promises and trusts rather than tort. It follows from that basic characteristic of the law of negligence that liability is generally imposed for causing harm rather than for failing to prevent harm caused by other people or by natural causes. It is also consistent with that characteristic that the exceptions to the general non imposition of liability for omissions include situations where there has been a voluntary assumption of responsibility to prevent harm (situations which have sometimes been described as being close or akin to contract), situations where a person has assumed a status which carries with it a responsibility to prevent harm, such as being a parent or standing in loco parentis, and situations where the omission arises in the context of the defendants having acted so as to create or increase a risk of harm. 5. The argument that most cases can be equally analysed in terms of either an act or an omission, sometimes illustrated by asking whether a road accident is caused by the negligent drivers act of driving or by his omission to apply the brakes or to keep a good lookout, does not reflect the true nature and purpose of the distinction, as explained above. The argument was answered by Lord Hoffmann in Stovin v Wise (p 945): One must have regard to the purpose of the distinction as it is used in the law of negligence, which is to distinguish between regulating the way in which an activity may be conducted and imposing a duty to act upon a person who is not carrying on any relevant activity. To hold the defendant liable for an act, rather than an omission, it is therefore necessary to be able to say, according to common sense principles of causation, that the damage was caused by something which the defendant did. If I am driving at 50 miles an hour and fail to apply the brakes, the motorist with whom I collide can plausibly say that the damage was caused by my driving into him at 50 miles an hour. 6. In relation to the cases discussed in Lord Hughess para 114, it follows from the foregoing explanation of the distinction between acts and omissions that Hill and Smith were concerned with omissions, as in each case the claimant sought to have the police held liable for death or personal injuries which had been caused not by the police but by a third party. Calveley, Elguzouli Daf and Brooks, on the other hand, were concerned with positive acts, but were cases in which a duty of care was held not to exist for other reasons, as explained earlier. In Calveley, the plaintiffs sought to have the police held liable for economic loss and other harm which they had caused by subjecting the plaintiffs to disciplinary proceedings which were unduly prolonged. In Elguzouli Daf, the plaintiffs sought to have the Crown Prosecution Service held liable for a loss of liberty which they had caused by subjecting the plaintiffs to criminal proceedings which were unduly prolonged. In Brooks, the claimant sought to have the police held liable for a mental illness which they had caused by treating him inconsiderately. 7. So far as the cases discussed in Lord Hughess paras 115 117 are concerned, Goldman v Hargrave [1967] 1 AC 645 and Thomas Graham Ltd v Church of Scotland 1982 SLT (Sh Ct) 26 concerned the responsibilities of an occupier of land in respect of dangers to his neighbours property which arise on his land: responsibilities which can be understood as arising from his exclusive right of possession. Michael was clearly concerned with an omission, as Lord Toulsons judgment made clear: the police were sought to be made liable for the death of a woman at the hands of a third party. Barrett v Enfield London Borough Council, as explained in Gorringe at para 39, was a case where there was an assumption of parental responsibilities. Phelps v Hillingdon London Borough Council, as explained in Gorringe at para 40, concerned a relationship which involved an implied undertaking to exercise reasonable care, akin to the relationship between doctor and patient. Returning, then, to the second of the issues identified in para 20 above, it follows that there is no general rule that the police are not under any duty of care when discharging their function of preventing and investigating crime. They generally owe a duty of care when such a duty arises under ordinary principles of the law of negligence, unless statute or the common law provides otherwise. Applying those principles, they may be under a duty of care to protect an individual from a danger of injury which they have themselves created, including a danger of injury resulting from human agency, as in Dorset Yacht and Attorney General of the British Virgin Islands v Hartwell. Applying the same principles, however, the police are not normally under a duty of care to protect individuals from a danger of injury Is this case concerned with an omission or with a positive act? In the light of that conclusion, the remaining issues in the case are relatively which they have not themselves created, including injury caused by the conduct of third parties, in the absence of special circumstances such as an assumption of responsibility. straightforward and can be dealt with comparatively briefly. (3) The role of the police in the accident in which Mrs Robinson was injured is not comparable to that of the defendant in the examples commonly given of pure omissions: for example, someone who watches and does nothing as a blind man approaches the edge of a cliff, or a child drowns in a shallow pool. Nor, to cite more realistic examples, is it comparable to that of the police authority in Hill, which failed to arrest a murderer before a potential future victim was killed, or the police authority in Michael, which failed to respond to an emergency call in time to save the caller from an attack. In such cases the defendant played no active part in the critical events. Nor is this a case in which the chief constable is sought to be made liable for the conduct of a third party. Lord Reids observation in Dorset Yacht (at p 1027) is apposite: the ground of liability is not responsibility for the acts of the escaping trainees; it is liability for damage caused by the carelessness of these officers in the knowledge that their carelessness would probably result in the trainees causing damage of this kind. In the present case, the ground of action is liability for damage caused by carelessness on the part of the police officers in circumstances in which it was reasonably foreseeable that their carelessness would result in Mrs Robinsons being injured. Her complaint is not that the police officers failed to protect her against the risk of being injured, but that their actions resulted in her being injured. In short, this case is concerned with a positive act, not an omission. (4) Did the police officers owe a duty of care to Mrs Robinson? It was not only reasonably foreseeable, but actually foreseen by the officers, that Williams was likely to resist arrest by attempting to escape. That is why Willan summoned assistance in the first place, before attempting to arrest Williams, and why it was decided that DS Roebuck and DC Green should be positioned on the opposite side of Williams from Willan and Dhurmea, so as to block his escape route. The place where the officers decided to arrest Williams was a moderately busy shopping street in a town centre. Pedestrians were passing in close vicinity to Williams. In those circumstances, it was reasonably foreseeable that if the arrest was attempted at a time when pedestrians especially physically vulnerable pedestrians, such as a frail and elderly woman were close to Williams, they might be knocked into and injured in the course of his attempting to escape. That reasonably foreseeable risk of injury was sufficient to impose on the officers a duty of care towards the pedestrians in the immediate vicinity when the arrest was attempted, including Mrs Robinson. (5) Was the Court of Appeal entitled to overturn the Recorders finding that the officers had failed in their duty of care? The Court of Appeal was correct to emphasise the importance of not imposing unrealistically demanding standards of care on police officers acting in the course of their operational duties. That is most obviously the case where critical decisions have to be made in stressful circumstances with little or no time for considered thought. This point has long been recognised. For example, in Marshall v Osmond, concerned with a police driver engaged in the pursuit of a suspect, Sir John Donaldson MR stated, as noted at para 47 above, that the officers duty was to exercise such care and skill as is reasonable in all the circumstances. He went on to state that those were no doubt stressful circumstances, and that although there was no doubt that the officer made an error of judgment, he was far from satisfied that the officer had been negligent (p 1038). The same point was made, in a context closer to that of the present case, by May LJ in Costello v Chief Constable of Northumbria [1999] ICR 752, 767, where he remarked that liability should not turn on . shades of personal judgment and courage in the heat of the potentially dangerous moment. It is also necessary to remember that a duty to take reasonable care can in some circumstances be consistent with exposing individuals to a significant degree of risk. That is most obviously the case in relation to the police themselves. There are many circumstances in which police officers are exposed to a risk of injury, but in which such exposure is consistent with the taking of reasonable care for their safety. Equally, there may be circumstances which justify the taking of risks to the safety of members of the public which would not otherwise be justified. A duty of care is always a duty to take such care as is reasonable in the circumstances. In the present case, the Recorders finding of negligence was based on a number of matters. It is unnecessary to consider them all, as at least one of them clearly did not involve imposing on the officers an unrealistically high standard of care. The Recorder accepted DS Willans evidence that the officers were aware that there was a significant risk that Williams would try to run away, and that he was aware of the potential for harm to members of the public in that event. Willan also gave evidence that it was necessary to consider the risk to those in the vicinity, and that if it had appeared to him that someone was in harms way, he would have walked past Williams without effecting the arrest. The Recorder noted that that was in accordance with the relevant guidance provided to police officers. Although Mrs Robinson had just walked past Williams and was within a yard of him, in full view of the officers, Willan simply failed to notice her. The Recorder was entitled to find negligence on that basis alone, regardless of the soundness of his other criticisms of how the arrest was carried out. Willan accepted that he ought to have been taking care for the safety of members of the public in the immediate vicinity. If he had been taking such care, he would have noticed Mrs Robinson: she was immediately in front of him, next to Williams. This was not a situation in which Williams had to be arrested at that precise moment, regardless of the risk that a passer by might be injured: on Willans evidence, if he had noticed that someone was in harms way, he would not have made the arrest at that moment. (6) Were Mrs Robinsons injuries caused by the officers breach of their duty of care? The chain of events which resulted in Mrs Robinsons being injured was initiated by DS Willans and PC Dhurmeas attempt to arrest Williams. It was their taking hold of him which caused him to attempt to struggle free, and it was in the course of the resultant tussle between the three men that Mrs Robinson was knocked over and injured. In these circumstances, it is impossible to argue that the chain of causation linking the attempt to arrest Williams to Mrs Robinsons being injured was interrupted by Williams voluntary decision to resist arrest, which resulted in his knocking into her. The voluntary act of a third party, particularly when it is of a criminal character, will often constitute a novus actus interveniens, but not when that act is the very one which the defendant was under a duty to guard against: see, for example, Dorset Yacht and Attorney General of the British Virgin Islands v Hartwell. It would be absurd to say that the officers owed Mrs Robinson a duty of care not to arrest Williams when she was in the immediate vicinity, because of the danger that she might be injured if he attempted to escape, and then to hold that his attempted escape broke the chain of causation between their negligently arresting him when she was next to him, and her being injured when he attempted to escape. In short, Mrs Robinson was injured as a result of being exposed to the very danger from which the officers had a duty of care to protect her. Conclusion For these reasons, I would allow the appeal, hold that the Chief Constable is liable in damages to Mrs Robinson, and remit the case for the assessment of damages. LORD MANCE: I have read with benefit the judgments prepared by Lord Reed and Lord Hughes in this case. I agree that the case is one of positive conduct by the police in instigating an arrest on public pavement, which caused injury to Mrs Robinson, an otherwise uninvolved passer by. Having watched the excellent CCTV recording and compared it with the judges findings, I confess to the same doubt as Lord Hughes about the judges finding of negligence. The pavement was quite busy, the relevant suspects were for the first time stationary, and Mrs Robinson might appear to have passed by and to be at a little distance, by the time the police seized what they obviously thought was the opportune moment. However, like Lord Hughes and bearing in mind the evidence accepted by the judge as set out by Lord Reed in his para 77, I do not on balance consider that this is a case where an appellate court should interfere with the judges conclusions, after hearing all the evidence. As Lord Reed demonstrates, it is unnecessary in every claim of negligence to resort to the three stage analysis (foreseeability, proximity and fairness, justice and reasonableness) identified in Caparo Industries Ltd v Dickman [1990] 2 AC 605. There are well established categories, including (generally) liability for causing physical injury by positive act, where the latter two criteria are at least assumed. The concomitant is that there is, absent an assumption of responsibility, no liability for negligently omitting to prevent damage occurring to a potential victim. This also provides a rationale for the general rule that the police and CPS have no liability for failure, by efficient investigation or pursuit of an actual or potential offence, to prevent a subsequent victim from suffering physical injury at the hands of a third party for whose acts the State is not responsible: Michael v Chief Constable of South Wales Police [2015] UKSC 2; [2015] AC 1732, paras 114 130 and 137. Economic loss also falls outside the established category of liability for physical injury, but an assumption of responsibility for economic loss will, as discussed in Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465, likewise satisfy the latter two Caparo criteria. Outside any established category, the law will proceed incrementally, and all three stages of the Caparo analysis will be material. It would be unrealistic to suggest that, when recognising and developing an established category, the courts are not influenced by policy considerations. No one now suggests that the common law has not changed since the Saxon era, merely to be revealed from time to time by an increasingly perceptive judiciary. As Lord Reid said famously in The Judge as Law maker: There was a time when it was thought almost indecent to suggest that judges make law they only declare it . But we do not believe in fairy tales any more: 12 Journal of the Society of Public Teachers of Law 22 (1972); see also Lord Goffs comments on the declaratory theory of the common law in Kleinwort Benson Ltd v Lincoln County Council [1999] 2 AC 349, 377 379. The courts are not a Law Commission, but, in recognising the existence of any generalised duty in particular circumstances they are making policy choices, in which considerations such as proximity and fairness, justice and reasonableness must inhere. Landmark examples are Donoghue v Stevenson [1932] UKHL 100; [1932] AC 562, in relation to physical injury, and Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465, in circumstances where there has been an assumption of responsibility to give accurate information upon which it is foreseeable that the recipient will rely to its economic benefit or detriment. The key to the application of the above principles is to ascertain whether or not a particular situation falls within an established category. Lord Reed treats physical loss resulting foreseeably from positive conduct as constituting axiomatically such a category, whatever the precise circumstances. I accept that principle as generally correct: see eg Alcock v Chief Constable of South Yorkshire [1992] 1 AC 310, 396F G, per Lord Keith. But I am not persuaded that it is always a safe guide at the margins. I note that Lord Oliver went no further in Caparo than to say that, in the context of loss caused by physical damage, the existence of the nexus between the careless defendant and the injured plaintiff can rarely give rise to any difficulty: p 632F. He went on to identify Hill, so far as concerns the alternative ground of that decision, as a case where, in any ordinary meaning of the words, a relationship of proximity (in the literal sense of closeness) exists but where the law, whilst recognising the fact of the relationship, nevertheless denies a remedy to the injured party on the ground of public policy: p 633D E. Lord Reed says that Smith v Ministry of Defence [2013] UKSC 41; [2014] AC 52 was a case where it was appropriate to apply the three stage Caparo approach because it raised a novel legal issue, relating to the provision of protective equipment to soldiers on active duty, and the scope of combat immunity: it did not concern an established category of liability. But, why not? Combat immunity, where it applies, is, I suggested at para 114, itself not so much an entirely separate principle as the result of a general conclusion that it is not fair, just or reasonable to regard the Crown or its officers, soldiers or agents as under a duty of care to avoid injury or death in their acts or omissions in the conduct of an active military operation or act of war. And, however that may be, a reading of the judgments shows that no distinctions were there drawn between acts and omissions, either generally or in the specific context of the discussion which is to be found on prior authority, including Hill v Chief Constable of West Yorkshire [1989] AC 53, Elguzouli Daf v Commissioner of Police for the Metropolis [1995] QB 335, Stovin v Wise [1996] AC 923, Brooks v Commissioner of Police for the Metropolis [2005] 1 WLR 1495 and Van Colle v Chief Constable of the Hertfordshire Police [2009] AC 225: see Smiths case at eg paras 82 83, 95 96 and 97, per Lord Hope and paras 108 109, 114, 117 and 136, per Lord Mance (dissenting). Lord Carnwaths (dissenting) judgment at paras 157 170 is also of interest, for noting that the issue was a novel one, and that the closest analogy consisted in the above line of cases about police responsibility, again without drawing any distinction between acts and omissions. The case was a novel one, not because it fell outside the general category of negligent acts or omissions allegedly causing physical loss, but because it was not (yet) established that the established category embraced the particular types of acts or omissions alleged and the circumstances in which soldiers might suffer from them. Indeed, it was accepted on all sides that combat immunity meant that the established category was not on any view completely unqualified, and the question arose in that respect what scope the courts should, as a matter of policy, attach to the principle of combat immunity. A similar difficulty arises in fitting other authorities which Lord Reed accepts as correctly decided into any absolutely fixed legal mould. The cases of Hill and Smith v Chief Constable of Sussex Police [2008] UKHL 50; [2009] AC 225 can, I agree, be rationalised as cases of omission, but that was not how they were reasoned. The case of Calveley v Chief Constable of the Merseyside Police [1989] AC 1228 involved a claim by police officers for pursuing disciplinary proceedings with insufficient expedition, thereby, it was alleged, causing them physical loss, which was held to be unforeseeable, and economic loss of a kind, which is, in the absence of any assumption of responsibility, generally irrecoverable. But again Lord Bridge buttressed his conclusion with general statements about the need to shield the police from the pursuit of claims in relation to their investigative activity, without distinction between acts and omissions. In Elguzouli Daf there were two similarly based claims, but the consequences of the CPSs failure to pursue their investigation with sufficient expedition were alleged to be that the claimants remained in custody for some 22 and 85 days respectively. In the absence of any specific assumption of responsibility, the Court of Appeal held that policy factors argued against the recognition of a duty of care owed by the CPS to those it prosecutes: p 349B C, per Steyn LJ, who went on: While it is always tempting to yield to an argument based on the protection of civil liberties, I have come to the conclusion that the interests of the whole community are better served by not imposing a duty of care on the CPS. As Morritt LJ put it at p 352G H, policy considerations similar to those which weighed with Lord Keith in Hills case excluded any general duty to use reasonable care in the institution and conduct of criminal proceedings. The reasoning contains no hint of a categorical distinction between acts and omissions. A year later, the House had before it in Marc Rich & Co AG v Bishop Rock Marine Co Ltd [1996] 1 AC 211 a claim by cargo owners against a classification society by whose alleged negligence the carrying vessel was allowed to continue on her voyage after temporary repairs to a crack in her hull, which then caused the loss of both vessel and cargo. Cargo owners primary submission was that, this being a case of physical damage to property in which the plaintiff had a proprietary or possessory interest, the only requirement was proof of reasonable foreseeability. The House rejected this categorically, in the following passage from Lord Steyns speech, p 235D H): Counsel for the cargo owners submitted that in cases of physical damage to property in which the plaintiff has a proprietary or possessory interest the only requirement is proof of reasonable foreseeability. For this proposition he relied on observations of Lord Oliver of Aylmerton in Caparo Industries Plc v Dickman [1990] 2 AC 605, 632C 633D. Those observations, seen in context, do not support his argument. They merely underline the qualitative difference between cases of direct physical damage and indirect economic loss. The materiality of that distinction is plain. But since the decision in Dorset Yacht Co Ltd v Home Office [1970] AC 1004 it has been settled law that the elements of foreseeability and proximity as well as considerations of fairness, justice and reasonableness are relevant to all cases whatever the nature of the harm sustained by the plaintiff. Saville LJ explained at 1077[D E]: . whatever the nature of the harm sustained by the plaintiff, it is necessary to consider the matter not only by inquiring about foreseeability but also by considering the nature of the relationship between the parties; and to be satisfied that in all the circumstances it is fair, just and reasonable to impose a duty of care. Of course, these three matters overlap with each other and are really facets of the same thing. For example, the relationship between the parties may be such that it is obvious that a lack of care will create a risk of harm and that as a matter of common sense and justice a duty should be imposed. Again in most cases of the direct infliction of physical through loss or injury carelessness, it is self evident that a civilised system of law should hold that a duty of care has been broken, whereas the infliction of financial harm may well pose a more difficult problem. Thus the three so called requirements for a duty of care are not to be treated as wholly separate and distinct requirements but rather as convenient and helpful approaches to the pragmatic question whether a duty should be imposed in any given case. In the end whether the law does impose a duty in any particular circumstances depends upon those circumstances, . That seems to me a correct summary of the law as it now stands. It follows that I would reject the first argument of counsel for the cargo owners. (italics added for emphasis) While both the House and Saville LJ (as he was) were happy to accept that in most cases of the direct infliction of physical loss or injury through carelessness, liability was self evident, they were cautious to warn against absolute rules in that respect. Elguzouli Daf was, as Lord Reed notes, para 59, followed and applied in SXH v Crown Prosecution Service [2017] UKSC 30; [2017] 1 WLR 1401, where the complaint was that the CPS had acted unreasonably in prosecuting an asylum seeker, leading to her detention for some months. Lord Toulson giving the majority judgment said: 38. The duty of the CPS is to the public, not to the victim or to the suspect, who have separate interests. To recognise a duty of care towards victims or suspects or both, would put the CPS in positions of potential conflict, and would also open the door to collateral interlocutory civil proceedings and trials, which would not be conducive to the best operation of the criminal justice system. Similar considerations are relevant when considering the applicability of article 8 in the context of a decision to prosecute. A decision to prosecute does not of itself involve a lack of respect for the autonomy of the defendant but places the question of determining his or her guilt before the court, which will itself be responsible for deciding ancillary questions of bail or remand in custody and the like. The claim here was clearly for a positive act, causing excessive detention. Finally, Lord Reed dismisses Brookss case on the basis that it concerned police behaviour which was merely insensitive and so not normally actionable, even if it results in a psychiatric illness: para 60. But the starting point for the Houses consideration of the case was that Mr Brooks had, as a key witness to the fatal attack on Stephen Lawrence on 22 April 1993, suffered from a very serious post traumatic stress disorder until the spring of 1998, and that this had been severely exacerbated or aggravated as a result of the polices failure to treat him lawfully: para 10. Lord Steyn said in this connection that: In particular the matter must be considered on the basis that Mr Brooks has suffered personal injury (in the form of an exacerbation of or aggravation of the post traumatic stress that was induced by the racist attack itself) in consequence of the negligence of the officers and that injury of this type was reasonably foreseeable. (para 16) That being the basis on which the matter fell to be considered, the appellant advanced the argument that Hills case could be distinguished. The House disposed of that argument tersely as follows, para 32: The only suggested distinction ultimately pursued was that in Hills case the police negligence was the indirect cause of the murder of the daughter whereas in the present case the police directly caused the harm to Mr Brooks. That hardly does justice to the essential reasoning in Hills case. In any event, Calveley , Elguzouli Daf , and Kumar were cases of alleged positive and direct negligence by the police. The distinction is unmeritorious. According to the Houses decision in Alcocks case, what is necessary in order to recover damages for negligently caused psychiatric injury is not only foreseeability, but also proximity. Both requirements appear clearly to have been present in Brooks case. In the event, Lord Steyn also treated the third stage of the Caparo test (fairness, justice and reasonableness) as applicable. But it is clear that the House decided the case by reference to a general principle derived from the cases of Hill, Calveley and Elguzouli Daf, and not on the basis of any general distinction between either physical and psychiatric injury or acts or omission. Rather, it decided the case on the basis that, outrageous negligence aside, the police owe no duty of care not to cause by positive act or omissions harm to victims of serious crime, or witnesses to serious crime, with whom they have contact; and it rejected categorically any distinction between indirect causation of the murder of an innocent victim, due to failure properly to investigate past offences against other victims (Hills case) and harm directly caused to Mr Brooks (Brookss case itself): paras 18 and 32. What I think emerges from this examination of past authority is that it is not possible to state absolutely that policy considerations may not shape police or CPS liability in a context where the conduct of the police may perfectly well be analysed as positive, rather than simply as involving some form of omission. It is at least clear that extended detention and psychiatric injury, due to the polices or CPSs positive acts or omissions, will be treated as outside any otherwise generally established category of liability for negligence. As to the present appeal, I also think that there was open to the law a genuine policy choice whether or not to hold the police responsible on a generalised basis for direct physical intervention on the ground, causing an innocent passer by physical injury, in the performance of their duties to investigate, prevent and arrest for suspected offending by some third person(s). In my opinion, that policy choice should now be made unequivocally in the sense indicated by Lord Reed. In Hills case Lord Keith stated (p 59B C), that: There is no question that a police officer, like anyone else, may be liable in tort to a person who is injured as a direct result of his acts or omissions. So he may be liable in damages for assault, unlawful arrest, wrongful imprisonment and malicious prosecution, and also for negligence. Lord Keith then cited as instances where liability for negligence has been established two authorities: Knightley v Johns [1982] 1 WLR 349 and Rigby v Chief Constable of Northamptonshire [1985] 1 WLR 1242. Neither comes particularly close to the present case, and indeed, in reasoning to some extent echoed in the present Court of Appeal decision, the Court of Appeal (Leveson and Toulson LJJ) in Desmond v Chief Constable of Nottinghamshire Police [2011] EWCA Civ 3; [2011] PTSR 1369, identified the modified core principle in Hill as meaning that: Absent special circumstances, the police do not owe individual members of the public a common law duty of care in undertaking their operational duties of investigating, detecting, suppressing and prosecuting crime: para 31. But it recognised that the modified core principle in Hill may not apply in exceptional circumstances at the margins. It gave as examples of where it would not apply cases of negligent driving by the police and of assumption of responsibility. It also identified as further examples the two cases mentioned by Lord Keith. As to those two cases, the former concerned police (mis)management of the aftermath of a relatively mundane traffic accident, by giving instructions to an officer to ride against the traffic flow in a tunnel, as a result of which he suffered personal injury. The latter concerned police failure to re equip themselves with fire fighting equipment, before taking the drastic step, with a view to forcing the intruders arrest, of firing an incendiary canister into a building in which an intruder had broken with a gun. The present case concerns in contrast a quite delicate operational decision involving coordination between four officers, with a view to the arrest of suspected drug dealers, in a public place. It can be suggested that this raises special considerations, negativing any duty of care. But in my view we should not accept that suggestion. Rather we should now recognise the direct physical interface between the police and the public, in the course of an arrest placing an innocent passer by or bystander at risk, as falling within a now established area of general police liability for positive negligent conduct which foreseeably and directly inflicts physical injury on the public. On that basis, I would also allow this appeal and restore the judges judgment. LORD HUGHES: The question of law The general question of importance in this appeal is when the police do or do not owe a legal duty of care to individuals in the course of performing their public functions of investigating and preventing crime. It is important that the question is posed in those terms. It may have become a convenient shorthand to express the decisions of the House of Lords and this court in Hill v Chief Constable of West Yorkshire, Brooks v Commissioner of Police of the Metropolis, Smith v Chief Constable of Sussex Police and Michael v Chief Constable of South Wales in terms of a rule of police immunity. That may not be surprising since Lord Keith did at one point in Hill refer to the police as immune from an action of the kind there brought. Whether convenient or not, that shorthand is misleading, as Lord Toulson explained in Michael at para 44. Whatever the answer to the question posed, the police do not enjoy some immunity from liability which otherwise would arise. Like others, however, they do not owe a duty of care to avoid harm or damage in every situation where such harm or damage can be foreseen. The general rule of law of tort is that the foreseeability of harm is a necessary but not a sufficient condition for liability. So in all the many situations and relationships which may result in damage, the question becomes: when is the defendant under a legal duty of care to the claimant to take reasonable steps to avoid it. For the reasons very clearly set out by Lord Reed at paras 21 30 it is neither necessary nor appropriate to treat Caparo Industries v Dickman [1990] 2 AC 605 as requiring the application of its familiar three stage examination afresh to every action brought. Where the law is clear that a particular relationship, or recurrent factual situation, gives rise to a duty of care, there is no occasion to resort to Caparo, at least unless the court is being invited to depart from previous authority. The four cases of Hill, Brooks, Smith and Michael make it clear that they do not touch on the liability of police officers if by positive negligent act they cause physical harm to individuals or damage to property. That is apparent from: i) the approval in those cases of the decisions in Rigby v Chief Constable of Northamptonshire (negligent use of a CS gas canister in an attempt to force an armed psychopath from a shop in which he had gone to ground) and Knightley v Johns (negligent organisation of traffic in an emergency situation); and ii) subsequent cases, that: the explicit statement by Lord Keith in Hill at 59B, approved in There is no question that a police officer, like anyone else, may be liable in tort to a person who is injured as a direct result of his acts or omissions. (although see below for consideration of omissions). There are other examples of recognition of the duty of care which police officers owe not by positive negligent act to cause physical harm. They include Marshall v Osmond (a car chase) and Ashley v Chief Constable of Sussex Police (where negligent shooting of a suspected criminal was conceded). The principal cases, however, also contain explicit statements of the vital policy considerations which impose limits on the duties of care which the police owe to individuals when engaged in their public function of investigating and preventing crime. The analysis begins with Lord Keith in Hill. With the express agreement of three other members of the court, and a concurring speech by the fifth, he said at 63A: That is sufficient for the disposal of the appeal. But in my opinion there is another reason why an action for damages in negligence should not lie against the police in circumstances such as those of the present case, and that is public policy Potential existence of such liability may in many instances be in the general public interest, as tending towards the observance of a higher standard of care in the carrying on of various different types of activity. I do not, however, consider that this can be said of police activities. The general sense of public duty which motivates police forces is unlikely to be appreciably reinforced by the imposition of such liability so far as concerns their function in the investigation and suppression of crime. From time to time they make mistakes in the exercise of that function, but it is not to be doubted that they apply their best endeavours to the performance of it. In some instances the imposition of liability may lead to the exercise of a function being carried on in a detrimentally defensive frame of mind. The possibility of this happening in relation to the investigative operations of the police cannot be excluded. Further it would be reasonable to expect that if potential liability were to be imposed it would be not uncommon for actions to be raised against police forces on the ground that they had failed to catch some criminal as soon as they might have done, with the result that he went on to commit further crimes. While some such actions might involve allegations of a simple and straightforward type of failure for example that a police officer negligently tripped and fell while pursuing a burglar others would be likely to enter deeply into the general nature of a police investigation, as indeed the present action would seek to do. The manner of conduct of such an investigation must necessarily involve a variety of decisions to be made on matters of policy and discretion, for example as to which particular line of inquiry is most advantageously to be pursued and what is the most advantageous way to deploy the available resources. Many such decisions would not be regarded by the courts as appropriate to be called in question, yet elaborate investigation of the facts might be necessary to ascertain whether or not this was so. A great deal of police time, trouble and expense might be expected to have to be put into the preparation of the defence to the action and the attendance of witnesses at the trial. The result would be a significant diversion of police manpower and attention from their most important function, that of the suppression of crime. Closed investigations would require to be reopened and retraversed, not with the object of bringing any criminal to justice but to ascertain whether or not they had been competently conducted. Lord Templeman added this at 65: Moreover, if this action lies, every citizen will be able to require the court to investigate the performance of every policeman. If the policeman concentrates on one crime, he may be accused of neglecting others. If the policeman does not arrest on suspicion a suspect with previous convictions, the police force may be held liable for subsequent crimes. The threat of litigation against a police force would not make a policeman more efficient. The necessity for defending proceedings, successfully or unsuccessfully, would distract the policeman from his duties. This action is in my opinion misconceived and will do more harm than good. In Brooks at para 28 Lord Steyn qualified that part of what Lord Keith had said about the best endeavours of police officers, saying that a more sceptical approach to the carrying out of all public functions was necessary. His qualification was shared by Lord Bingham at paras 3 and 4 and by Lord Nicholls at para 6. But notwithstanding that reservation, Lord Steyn, with whom Lord Rodger and Lord Brown fully agreed, otherwise fully endorsed the reasoning of Lord Keith. At para 30 he held that the core principle of Hill had remained unchallenged for many years. He went on: It is, of course, desirable that police officers should treat victims and witnesses properly and with respect: compare the Police (Conduct) Regulations 2004 (SI 2004/645). But to convert that ethical value into general legal duties of care on the police towards victims and witnesses would be going too far. The prime function of the police is the preservation of the Queens peace. The police must concentrate on preventing the commission of crime; protecting life and property; and apprehending criminals and preserving evidence : A retreat from the principle in Hills case would have detrimental effects for law enforcement. Whilst focusing on investigating crime, and the arrest of suspects, police officers would in practice be required to ensure that in every contact with a potential witness or a potential victim time and resources were deployed to avoid the risk of causing harm or offence. Such legal duties would tend to inhibit a robust approach in assessing a person as a possible suspect, witness or victim. By placing general duties of care on the police to victims and witnesses the polices ability to perform their public functions in the interests of the community, fearlessly and with despatch, would be impeded. It would, as was recognised in Hills case, be bound to lead to an unduly defensive approach in combating crime. As Lord Steyn pointed out (para 19), there can be no doubt that Lord Keiths analysis represented the alternative ground of decision for, and part of the ratio decidendi of, Hill. In the same case, Lord Bingham, at para 4, said of the suggested duties of care to witnesses which were advanced by the claimant, But these are not duties which could be imposed on police officers without potentially undermining the officers performance of their functions, effective performance of which serves an important public interest. That is, in my opinion, a conclusive argument in the Commissioners favour. And at para 5 Lord Nicholls held that These duties would cut across the freedom of action the police ought to have when investigating serious crime. In Smith Lord Bingham dissented on the extent of the duty of care owed to those who complained to the police about risks from another identified person and advanced what he termed a liability principle recognising a duty of care in narrow circumstances. But notwithstanding that opinion, he reviewed the policy considerations voiced by Lord Keith in Hill and by the House in Brooks and, except for the reservation entered in Brooks which is explained above, he did not question them: see paras 48 52. The majority of the House expressly endorsed the policy considerations subject to the same reservation. At para 74 Lord Hope addressed Lord Binghams opinion that the limited liability which he would have imposed was not inconsistent with the policy factors, and that the observations in Hill and Brooks were to be read in the context of the duties there contended for. He held that they were not so limited: In my opinion however it is clear from Lord Steyns opinion, read as a whole, that he was laying down a principle of public policy that was to be applied generally. In para 22 he referred to his own judgment in Elguzouli Daf v Comr of Police of the Metropolis [1995] 1 QB 335. That was, as he said, a different case altogether, as it raised the question whether the Crown Prosecution Service (CPS) owed a duty of care to those whom it was prosecuting. But he relied on the case by analogy. In holding in Elguzouli Daf that policy factors argued against the recognition of a duty of care owed by the CPS to those whom it prosecutes, he said this at p 349: While it is always tempting to yield to an argument based on the protection of civil liberties, I have come to the conclusion that the interests of the whole community are better served by not imposing a duty of care on the CPS. In my view, such a duty of care would tend to have an inhibiting effect on the discharge by the CPS of its central function of prosecuting crime. It would in some cases lead to a defensive approach by prosecutors to their multifarious duties. It would introduce a risk that prosecutors would act so as to protect themselves from claims of negligence. 75. The phrase the interests of the whole community was echoed in the last sentence of the passage which I have quoted from Lord Steyns opinion in Brooks. There is an echo too in Brooks of the warning against yielding to arguments based on civil liberties: see the first sentence of that quotation where he warns against a retreat from the core principle. The point that he was making in Brooks, in support of the core principle in Hill, was that the principle had been enunciated in the interests of the whole community. Replacing it with a legal principle which focuses on the facts of each case would amount, in Lord Steyn's words, to a retreat from the core principle. We must be careful not to allow ourselves to be persuaded by the shortcomings of the police in individual cases to undermine that principle. That was the very thing that he was warning against, because of the risks that this would give rise to. As Ward LJ said in Swinney v Chief Constable of Northumbria Police Force [1997] QB 464, 487, the greater public good outweighs any individual hardship. A principle of public policy that applies generally may be seen to operate harshly in some cases, when they are judged by ordinary delictual principles. Those are indeed the cases where, as Lord Steyn put it, the interests of the wider community must prevail over those of the individual. 76. The risk that the application of ordinary delictual principles would tend to inhibit a robust approach in assessing a person as a possible suspect or victim, which Lord Steyn mentioned in the last sentence of the passage that I have quoted from his opinion in Brooks, is directly relevant to cases of the kind of which Smiths case is an example Police work elsewhere may be impeded if the police were required to treat every report from a member of the public that he or she is being threatened with violence as giving rise to a duty of care to take reasonable steps to prevent the alleged threat from being executed. Some cases will require more immediate action than others. The judgment as to whether any given case is of that character must be left to the police. I do not find it possible to approach Hill and Brooks as cases that turned on their own facts. The fact that Lord Steyn applied the decision in Hill to the facts of Brooks, which were so very different, underlines the fact that Lord Steyn was indeed applying a core principle that had been unchallenged for many years. That principle is, so it seems to me, that in the absence of special circumstances the police owe no common law duty of care to protect individuals against harm caused by criminals. The two relevant justifications advanced for the principle are (i) that a private law duty of care in relation to individuals would be calculated to distort, by encouraging defensive action, the manner in which the police would otherwise deploy their limited resources; (ii) resources would be diverted from the performance of the public duties of the At para 89 Lord Phillips observed that public policy has been at the heart of consideration whether a duty of care is owed by police officers to individuals. After reviewing the policy factors he concluded at para 97: police in order to deal with claims advanced for alleged breaches of private law duties owed to individuals. At para 108 Lord Carswell said this: Lastly, Lord Brown added, at paras 131 133 The factor of paramount importance is to give the police sufficient freedom to exercise their judgment in pursuit of their objects in work in the public interest, without being trammelled by the need to devote excessive time and attention to complaints or being constantly under the shadow of threatened litigation. Over reaction to complaints, resulting from defensive policing, is to be avoided just as much as failure to react with sufficient speed and effectiveness. That said, one must also express the hope that police officers will make good use of this freedom, with wisdom and discretion in judging the risks, investigating complaints and taking appropriate action to minimise or remove the risk of threats being carried out. 131. Fourthly, some at least of the public policy considerations which weighed with the House in Hill and Brooks to my mind weigh also in the present factual context. I would emphasise two in particular. 132. First, concern that the imposition of the liability principle upon the police would induce in them a detrimentally defensive frame of mind. So far from doubting whether this would in fact be so, it seems to me inevitable. If liability could arise in this context (but not, of course, with regard to the polices many other tasks in investigating and combating crime) the police would be likely to treat these particular reported threats with especial caution at the expense of the many other threats to life, limb and property of which they come to learn through their own and others endeavours. They would be likely to devote more time and resources to their investigation and to take more active steps to combat them. They would be likely to arrest and charge more of those reportedly making the threats and would be more likely in these cases to refuse or oppose bail, leaving it to the courts to take the responsibility of deciding whether those accused of making such threats should remain at liberty. The police are inevitably faced in these cases with a conflict of interest between the person threatened and the maker of the threat. If the police would be liable in damages to the former for not taking sufficiently strong action but not to the latter for acting too strongly, the police, subconsciously or not, would be inclined to err on the side of over reaction. I would regard this precisely as inducing in them a detrimentally defensive frame of mind. Similarly with regard to their likely increased focus on these reported threats at the expense of other police work. 133. The second public policy consideration which I would emphasise in the present context is the desirability of safeguarding the police from legal proceedings which, meritorious or otherwise, would involve them in a great deal of time, trouble and expense more usefully devoted to their principal function of combating crime. This was a point made by Lord Keith of Kinkel in Hill and is of a rather different character from that made by Lord Steyn in para 30 of his opinion in Brooks see para 51 of Lord Binghams opinion. In respectful disagreement with my Lord, I would indeed regard actions pursuant to the liability principle as diverting police resources away from their primary function. Not perhaps in every case but sometimes certainly, the contesting of these actions would require lengthy consideration to be given to the deployment of resources and to the nature and extent of competing tasks and priorities. In Michael Lord Toulson (at para 121) was inclined to accord force to criticism of the fear of defensive policing. But he held that it was possible to imagine that liability might lead to police forces changing their priorities, and that it was hard to see it as in the public interest that the determination of priorities should be affected by the risk of being sued. He added that the one thing of which any court could be sure is that the payment of compensation would have to come from police budgets, at the expense of spending on policing unless an increase in budgets from the public purse were to ensue. It should be acknowledged that it is sometimes asserted that that part of the policy considerations which related to the danger of defensive policing lacks hard evidence. That may technically be so, since there has not existed the kind of duty of care which would test it in practice. But like Lord Brown in Smith I for my part would regard that risk as inevitable. It can scarcely be doubted that we see the consequences of defensive behaviour daily in the actions of a great many public authorities. I do not see that it can seriously be doubted that the threat of litigation frequently influences the behaviour of both public and private bodies and individuals. However that may be, the several statements of the policy considerations, especially in three different decisions of the House of Lords, are simply too considered, too powerful and too authoritative in law to be consigned to history, as I do not understand Lord Reed to suggest that they should be. Nor do I see it as possible to treat them as no more than supporting arguments. As all of them, and especially the speech of Lord Hope set out at para 10 above, make clear, the statements are intended as ones of general principle. No doubt Hill was decided at a time when Anns v Merton London Borough Council was understood to provide the test for the existence of a duty of care. But the error of Anns was exposed at the latest in 1991 in Murphy v Brentwood Council, whilst Brooks and Smith were decided in 2005 and 2008 respectively. In any event, the error of Anns lay chiefly in its effective imposition of an often impossible burden on a defendant to demonstrate that public policy ought to negate the existence of a duty of care. The relevance of considerations of public policy, such as those so fully adumbrated in Hill, Brooks and Smith, and the fact that they may indeed demonstrate that a duty of care is not owed, remains unchanged by the different formulation in Caparo. In Michael (at para 97) Lord Toulson helpfully brought into the analysis the general reluctance of English law to impose liability in tort for pure omissions. Smith v Littlewoods Organisation Ltd [1987] AC 241, to which he referred, is a good example. There, the claimant suggested that the occupiers of a disused cinema, awaiting demolition and reconstruction as a shop, owed a duty to exclude vandals from getting in, so that they were liable to neighbours when the vandals started a fire which spread to adjoining properties. That was, no doubt, a case of pure omission, and was so analysed by Lord Goff, although not by the majority of the House of Lords, through Lord Mackay. It is clear that the reluctance of the common law to impose liability in tort for pure omissions is another reason why the police do not owe a duty of care to individuals who turn out to be the victims of crime (as in Hill or Smith) or to witnesses (as in Brooks) or to suspects (as in Calveley v Chief Constable of Merseyside and Elguzouli Daf ). But analysis in terms of omissions cannot be the only, or sufficient, reason why such duties of care are not imposed, nor why there is very clearly no duty owed to individuals in the manner in which investigations are conducted. There are at least two reasons why this is so. First, the rule against liability for omissions is by no means general. In Smith v Littlewoods Organisation Ltd Lord Goff identified at any rate several situations where such liability is imposed. One is where there has been an assumption of responsibility towards the claimant. The law readily finds such an assumption in many common situations, such as employment, teaching, healthcare and the care of children, and imposes liability for omitting to protect others. It could equally readily do so in the case of police officers with a general public duty to protect the peace, but it does not. Another was epitomised by Goldman v Hargrave and by Thomas Graham Ltd v Church of Scotland 1982 SLT (Sh Ct) 26, a case very similar to Littlewoods where the occupier knew of previous incursions by third parties and where Lord Goff accepted that liability was rightly imposed for omission to keep them out. If the occupation of land is treated as imposing liability for an omission, the law could, and might, have said that the same applies to police officers where they are aware of the risk posed by (or to) those they are investigating, but it does not. For the same reasons, the question whether a statutory public duty gives rise to a private duty or not is a fluid one. Stovin v Wise and Gorringe are examples where no private duty of care was held to exist. Barrett v Enfield London Borough Council, decided after Stovin v Wise, accepted at least in principle the possibility of such a duty in relation to the different statutory scheme there in question. Secondly, there is no firm line capable of determination between a case of omission and of commission. Some cases may fall clearly on one side of the line, and Hill may have been one of them. But the great majority of cases can be analysed in terms of either. Michael could be said to be a case of omission to respond adequately to the 999 call. But it was argued for the claimant as a case of a series of positive acts, such as, for example, misreporting the complaint when passing it from one police force to another. Barrett v Enfield London Borough Council was a case of mixed acts (allegedly negligent placements) and omissions (to arrange adoption). Phelps v Hillingdon London Borough Council similarly involved allegedly negligent examination, also a positive act. The ultimate reason why there is no duty of care towards victims, or suspects or witnesses imposed on police officers engaged in the investigation and prevention of crime lies in the policy considerations examined above and, in the end, in the clear conclusion, as expressed by Lord Hope in Smith (see para 10 above) that the greater public good requires the absence of any duty of care. Likewise the policy considerations will be directly relevant to any suggestion that a duty of care exists towards individuals such as victims, witnesses or suspects via the route of foreseeable risk of psychiatric harm. The law remains uncertain about when a claimant can properly be regarded as a primary or a secondary victim for the purposes of recovering damages for psychiatric harm: see Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455, McLoughlin v Grovers [2001] EWCA Civ 1743 per Hale LJ as she then was, and Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310. But it is clear that no duty of care towards victims of crime, witnesses or suspects can be erected on the back of foreseeability of psychiatric harm, and the reason clearly lies in the policy considerations. Thus whilst there remains a duty of care imposed on police officers not by positive action to occasion physical harm or damage to property which ought reasonably to be avoided, there is no duty of care towards victims, witnesses or suspects in the manner of the investigation of offences or the prevention of crime. That also means that there is no duty of care to protect individuals from harm caused by the criminal acts of third parties. Of course, where action is brought on the basis of physical harm done by positive act of the police, it will succeed if but only if negligence is proved. As Lord Reed explains at para 75, policing may sometimes involve unavoidable risk to individuals. It may very often involve extremely delicate balancing of choices. Crowd control, hostage situations, violent outbreaks of crime and the allocation of scarce resources where there are large numbers of persons with the potential to offend, even at the terrorist level, are simply examples. Sometimes decisions may have to be made under extreme pressure; at other times they may remain very difficult notwithstanding time for analysis, and there may be a high level of risk that they turn out to be wrong. The question is always not whether, with hindsight, the decision was wrong, but whether in all the circumstances it was reasonable. The present case I agree that the present case is one of positive act, namely arresting the suspect, which directly caused physical harm. It matters not that the suspect was the first to be in physical contact with the claimant given that the collision with her was by him plus two of the policemen. I confess that I have pondered hard about the finding of negligence. That the suspect might run away was known, but the limited risk that he not only would do so, but also would cannon into a pedestrian if he did, had to be balanced against the duty to effect an arrest promptly. Many might regard the decision when to effect the arrest as a marginal one. But it is important that appellate courts do not second guess trial judges who have had the opportunity to hear the witnesses in person, as well as to examine the CCTV in the light of the way the case is argued. It does not seem to me that even if one were to entertain doubts about how one might oneself have decided the issue, it can be right to displace the finding of the trial judge unless there is error of principle. It is impossible to say that the judge was not entitled to attach the significance he did to the fact that Mr Willan had lost sight of the claimant at the moment he moved in. In those circumstances I would allow the appeal and restore the finding of the trial judge. The case must be remitted to the court of trial for the still outstanding assessment of damages.

In July 2008, the Appellant, then aged 76, was knocked over on a street in the centre of Huddersfield by a group of men. Two of the men were police officers (DS Willan and PC Dhurmea) and the third was a suspected drug dealer (Williams) whom they were attempting to arrest. As the officers struggled with Williams, he backed into the Appellant, who was standing close by. She fell over, and the three men fell on top of her, causing her to be injured. The officers had foreseen that Williams would attempt to escape. They had not noticed that the Appellant was in the immediate vicinity. The principal question to be decided in this appeal was whether the officers owed a duty of care to the Appellant and whether, if they did, they were in breach of that duty. The judge held that the officers had been negligent, but that the police were immune from claims against them in negligence. The Court of Appeal found that most claims against the police when engaged in their core functions will fail the third stage of the Caparo test i.e. that it will not be fair, just and reasonable to impose a duty of care. The Court also found that Williams had caused the harm to the Appellant and the case therefore concerned an omission by the police, rather than a positive act. Finally, the Court considered that even if the officers had owed the Appellant a duty of care, they had not acted in breach of it. The issues to be resolved in the Supreme Court were (1) does the existence of a duty of care always depend on an application of the Caparo test (2) is there a general rule that the police are not under any duty of care when discharging their core functions, and is there any distinction between acts and omissions (3) was this a positive act or an omissions case (4) did the police owe a duty of care to the Appellant (5) if so, was the Court of Appeal correct to overturn the judges finding that the officers failed in that duty and (6) if there was a breach of a duty of care, were the Appellants injuries caused by it? The Appeal is allowed. Lord Reed gives the lead judgment with which Lady Hale and Lord Hodge agree. Lord Mance and Lord Hughes also allow the appeal but reach the conclusion that a duty of care existed by different reasoning. The proposition that there is a Caparo test which applies to all claims in the modern law of negligence, and that in consequence the court will only impose a duty of care where it considers it fair, just and reasonable to do so on the particular facts, is mistaken [21 24]. It is normally only in novel cases, where established principles do not provide an answer, that the courts need to exercise judgment that involves consideration of what is fair, just and reasonable [27]. This case concerned an application of established principles of the law of negligence and so the existence of a duty of care did not depend on the application of a Caparo test [30]. Like other public authorities, in accordance with the general law of tort, the police are subject to liability for causing personal injury [45 48]. On the other hand, as held by the Supreme Court in Michael v Chief Constable of South Wales Police (Refuge and others intervening) [2015] UKSC 2, the general duty of the police to enforce the criminal law does not carry with it a private law duty towards individual members of the public. The common law does not normally impose liability for omissions, or, more particularly, for a failure to prevent harm caused by the conduct of third parties [50]. The case of Hill v Chief Constable of West Yorkshire [1989] AC 53 is not authority for the proposition that the police enjoy a general immunity from suit in respect of anything done by them in the course of investigating or preventing crime. The effect of Hill is that the police do not owe a duty of care, in the absence of special circumstances, to protect the public from harm through the performance of their function of investigating crime [54 55]. The authorities relied on by the respondent [56 66] are not inconsistent with the police being generally under a duty of care to avoid causing personal injury where such a duty would arise according to ordinary principles of the law of negligence [67 68]. Applying these principles, the police may be under a duty of care to protect an individual from danger of injury which they have themselves created [70]. The present case concerned a positive act, not an omission. The reasonably foreseeable risk of injury to the Appellant when the arrest was attempted was enough to impose a duty of care on the officers [74]. The judge was entitled to find negligence where Willan accepted that he was aware of the risk that Williams would attempt to escape and of the risk to members of the public in that event, that he would not have attempted the arrest at a time when he was aware that someone was in harms way, and that he had failed to notice the Appellant [75 78]. The Appellants injuries were caused by the officers breach of their duty of care; she was injured as a result of being exposed to the danger from which they had a duty of care to protect her [79 80]. Both Lord Mance and Lord Hughes agreed with the majority that the present case concerned a positive act, not an omission, and that the finding of the trial judge on negligence should be restored [82; 122 124]. However, Lord Mance found it unrealistic to suggest that, when recognising and developing an established category of liability, the courts are not influenced by policy considerations [84]. It was not possible to state absolutely that policy considerations may not shape police liability where the conduct of the police may be analysed as positive, rather than simply as involving some form of omission [85 94]. However, he concluded that we should now recognise the direct physical interface between the police and the public, in the course of an arrest placing an innocent passer by at risk, as falling within a now established area of general police liability for positive negligent conduct which foreseeably and directly inflicts physical injury [97]. Lord Hughes referred to vital policy considerations which impose limits on the duty of care which the police owe to individuals. Such considerations are the ultimate reason why there is no duty of care imposed on police officers engaged in the investigation and prevention of crime towards victims, suspects or witnesses. The greater public good requires the absence of any duty of care [103 120]. In response to these points, Lord Reed emphasised that discussion of policy considerations is not a routine aspect of deciding cases in the law of negligence, and is unnecessary when existing principles provide a clear basis for the decision, as in the present appeal [69].

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The contest in this case is about who should bear the costs and expenses of a receiver appointed under an order which ought not to have been made. The appellant, who is a former partner in a well known firm of accountants, was appointed to act as management receiver of the assets of a group of companies referred to as Eastenders (the companies) on the application of the Crown Prosecution Service (CPS). The order was made under section 48 of the Proceeds of Crime Act 2002 (POCA) but was quashed on appeal. The receivers costs and expenses are put at 772,547. Who should bear those costs? There are three possible answers: the companies, the receiver or the CPS. The question has been considered by four judges who have arrived at three different answers. The receiver applied to the Crown Court, after the order had been quashed, for permission to draw his remuneration and expenses from the assets of the companies. The application was refused by Underhill J (now Underhill LJ) in a judgment given on 4 April 2012. He held that to grant the application would infringe the companies rights under article 1 of the First Protocol to the European Convention on Human Rights (A1P1). This provides: Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law. The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties. In his judgment Underhill J held that in principle the liability for the receivers remuneration and expenses should be borne by the CPS, but at that stage there was no such application before him. After a further hearing on 8 May 2012 he made an order including the following terms: i) The CPS was to pay the receivers remuneration and disbursements, subject to an assessment by the taxing authority of the Crown Court under the Criminal Procedure Rules. ii) The CPS was to pay the legal costs incurred by the receiver in the exercise of his functions as receiver. iii) The parties were to lodge further evidence and submissions as to whether sums previously retained by the receiver should be repaid to the companies. (There is a potential argument that some of the expenses incurred by the receiver in the course of running the companies would have been incurred by them in any event, but on this appeal the court has not been concerned with points of that kind.) iv) The CPS was to pay the companies litigation costs in respect of the various applications relating to the receivership order. In making that order Underhill J held that it was possible to interpret POCA as giving the court the right, in circumstances such as those of the present case, to order that the receivers remuneration and expenses be paid by the CPS and not by the companies. The CPS appealed to the Court of Appeal Criminal Division. The majority (Mitting and Edwards Stuart JJ) upheld Underhill Js decision that the companies rights under A1P1 would be infringed by an order permitting the receivers costs and expenses to be taken out of their assets. Laws LJ, dissenting, would have held that there was no such breach and that the receiver was entitled to recover those costs out of the companies assets under the order made in the Crown Court. The court was unanimous that Underhill J was wrong in deciding that POCA could be interpreted as giving him power to order the CPS to pay the receivers costs. The result of the majoritys decision was to leave the receiver unable to recover his costs either from the companies assets or from the CPS. They acknowledged that the outcome of the appeal would be clearly unsatisfactory to a receiver who has undertaken work and incurred expenses in the expectation that he would be both rewarded and recompensed out of assets identified for him by the CPS, and they added that their judgment did not exclude the possibility that he may have a common law remedy against those who sought his appointment, but they said no more about what it might be, presumably because the matter had not been argued. The receiver now appeals to this court. The principal argument advanced on his behalf by Mr David Perry QC was that Laws LJ was right and that the costs of the receivership should be borne by the companies. If that submission was rejected, his alternative submission was that Underhill J was correct to order that the costs be borne by the CPS. Mr Perry submitted powerfully that it could not be a just solution that the receiver, an officer appointed by the court, should be left without payment for acting as the court directed. Mr Geraint Jones QC submitted on behalf of the companies that those judges (Underhill, Mitting and Edwards Stuart JJ) who had concluded that to take the receivers costs out of the companies assets would be a breach of their rights under A1P1 were right. He also suggested that it was highly arguable that the contractual arrangements between the receiver and the CPS would entitle the receiver to remuneration by the CPS, but that was a matter between the receiver and the CPS. Mr Michael Parroy QC on behalf of the CPS joined forces with Mr Perry in arguing that Laws LJ was right. If, however, the effect of A1P1 was to preclude recovery of the receivers costs out of the companies assets, Mr Parroy submitted that the Court of Appeal was right in its unanimous decision that POCA did not afford any basis for holding the CPS liable to the receiver. He also submitted that there was no substance in the argument that the receiver would have a contractual remedy against the CPS. Issues The first question is whether the companies rights under A1P1 would be infringed by having their assets taken to pay the receivers remuneration and expenses. If Laws LJ was right in his view that this would not involve an infringement of their A1P1 rights, no further question arises. But if the companies are right about that issue, the second question that arises is whether the receiver is entitled to look to the CPS for reimbursement. When granting permission to appeal to this court, the leave panel asked the parties to address the additional issue whether there are any powers which could be exercised to prevent this situation arising whatever the outcome of the appeal. It will be necessary to consider that too. On 6 December 2010 the CPS applied ex parte to HH Judge Hawkins QC at the Central Criminal Court for restraint and receivership orders under sections 41 and 48 of POCA. The judge was in the course of trying a murder case and his time for hearing the application was limited. After a 40 minute hearing the judge signed the orders which he was asked to make. The evidence before the judge consisted of two witness statements made by Mr Alan Brown, a financial investigator employed by HM Revenue & Customs (HMRC), and their exhibits. In summary, he stated that HMRC was conducting a covert investigation into the activities of a serious organised criminal group which was believed to be responsible for evading excise duty and VAT on a large scale and laundering the proceeds. The suspected fraud involved alcohol products, which had been imported into the UK duty free, being released from bonded warehouses into the UK market without payment of duty in such a way that the true facts were concealed from HMRC by the use of buffer companies and bogus documents. The subjects under investigation included Mr Alexander Windsor and Mr Kulwant Singh Hare, referred to as the defendants in Mr Browns statements. Company searches and other records showed that the defendants were the joint beneficial owners of the Eastenders Group parent company, which held between 50% and 100% of the shares in the other group companies. The parent company was a holding company and the trading companies were cash and carry outlets. Mr Brown suggested that the companies were a wholesale and retail arm of the criminal group responsible for the alleged fraud. Mr Brown described the case as the most complex restraint and receivership case that he had ever managed in more than 20 years experience of such work. He estimated the public loss at 23 million. Mr Brown invited the court to lift the corporate veil of the companies, to treat their assets as assets in which the defendants had an interest and to restrain them and the companies from dealing with those assets. He also asked the court to appoint a management receiver to run the companies. He described their activities in this way: It is through these companies that the non duty and non VAT paid alcohol is sold onto the legitimate market. It is probable that these companies also conduct legitimate trade, in the sense that they buy and sell duty and VAT paid goods as well. However I do not know the ratio of legitimate to illegitimate activity. In these circumstances Mr Brown invited the court to conclude that a receivership order would be the only effective means of ensuring that the defendants assets could be properly managed. Terms for the receivers appointment had been agreed with the receiver in correspondence which was exhibited to Mr Browns statements. He said that he was unable to give a realistic estimate of the likely costs of the receivership, having regard to the nature of the assets involved. The judge made orders in relation to each defendant. They were in materially identical terms and I will refer to them as a single order. The order restrained the defendant from disposing of, dealing with or diminishing the value of any of his assets, which were expressed to include the assets of the companies. It imposed a similar direct restraint on the companies, and it appointed the receiver to act as management receiver of all the assets and property identified in the order, including the business and undertakings of the companies. The imposition of the restraint and receivership order on the companies necessarily depended on the court having proper reason to regard the assets of the companies as the personal assets of the defendants. The order gave the receiver a wide range of standard powers, including the power to realise so much of the receivership property as is necessary to meet the receivers remuneration and expenses. As to his remuneration and expenses, the order provided: The remuneration and expenses of the Receiver shall be paid out of the Receivership Property and in accordance with the letter of agreement as exhibited to the witness statement of Alan Brown made on 3 December 2010. The letter referred to was a letter from the CPS to the receiver dated 29 November 2010. Under the heading Re Kulwant Singh Hare and Alexander Thomas Windsor the letter began: We are writing to enquire whether you would be prepared to act as a management receiver pursuant to section 48 of the Proceeds of Crime Act 2010 in the above case of which the Crown Prosecution Service has conduct. You will appreciate that your appointment is dependent on an order being made by the Crown Court. This letter sets out the terms upon which we propose to seek your appointment. These terms will form part of the order for your appointment. In addition, your appointment is subject to the Framework Agreement between the Crown Prosecution Service and the panel of approved receivers, to the provisions of Part 60 of the Criminal Procedure Rules and to the Capewell Guidelines laid down by the Court of Appeal in Capewell v Customs & Excise Commissioners [2005] 1 All ER 900. In a brief summary of the background the letter explained that HMRC was conducting an investigation into the commission of offences by the named defendants involving the evasion of VAT and excise duty on a massive scale. The letter said: It is alleged that much of the fraudulent activity has been facilitated through a company known as Eastenders Cash and Carry plc and various subsidiary companies in Slough, Barking, Croydon, Birmingham and Coventry. Clearly, the effective management of these companies and their stock is an urgent priority if you are appointedThe extent to which the companies can be allowed to be allowed to continue trading will clearly be of fundamental importancegiven the urgent necessity to prevent any further fraudulent trading and loss to the Exchequer. The letter set out proposed terms of the appointment, including the following term as to the receivers remuneration: Your remuneration costs and expenses are to be drawn from the assets of the defendants under your management in accordance with section 49(2)(d) of the Proceeds of Crime Act and the decision of the House of Lords in Capewell v HM Revenue & Customs [2007] UKHL 2. You are reminded that you will have a lien over the defendants assets for payment of your fees and that the Crown Prosecution Service does not undertake to indemnify you in relation to your fees in the event that there are insufficient assets within the defendants estate. Your remuneration, costs and expenses are to be paid in accordance with the Framework Agreement referred to above and any deviation must be agreed in writing with the Crown Prosecution Service. Clause 12.5 of the Framework Agreement provided: In the case of Management and Enforcement Receivers in criminal confiscation cases, the Receiver will be remunerated from the sums that they may realise from the sale of the assets over which they are appointed [subject to an immaterial exception]. To the extent [that] there is any shortfall, the Contracting Bodies will not agree to grant indemnities either in full or in part. Although the receivership order covered all assets of the defendants, including properties and money in bank accounts, its central purpose was to put the companies under the control of the receiver. But for the fact that the companies were trading entities, there would have been no need for a receivership order. The restraint order would have been sufficient to freeze the defendants bank accounts and to prevent any disposal of their personal properties. The companies had around 120 employees and an aggregate turnover in the region of 150 million. In order to comply with section 49(8) of POCA (set out below), the order provided that the receivers powers of management, and power to realise property to meet his remuneration and expenses, were not to be exercised until further order of the court. This was in order to give the companies a reasonable opportunity to make representations. The matter was further considered by the judge in a brief hearing, on 14 December 2010 at the end of his normal sitting day. On the eve of that hearing the companies put in substantial evidence, but the court did not have time to consider the merits or hear detailed argument. The judge activated the receivers powers. It was then the busiest time of the trading year, only 11 days before Christmas. The judge activated the receivers management powers in order that their continued trading should be under the receivers control. The judge considered the companies objections to the receivership order on 23 December 2010 at an inter partes hearing but refused to discharge it. The matter came before the Court of Appeal (Hooper LJ, Openshaw J and Sir Geoffrey Grigson) on 25 January 2011. According to the judgment delivered by Hooper LJ, the appeal occupied the time of the court for 1 days following 2 days preparation for the hearing. The court quashed the restraint and receivership orders but took time for the delivery of its reasons in a judgment handed down on 8 February 2011 (neutral citation [2011] EWCA Crim 143). The case is reported in abbreviated form at [2011] 1 WLR 159 but in full at [2011] 2 Cr App R 71. The court expressed considerable sympathy for the judge who had been given responsibility to decide at short notice whether to grant restraint and receivership orders at a time when he was occupied with the conduct of a complex jury trial. Having had a much better opportunity to analyse the evidence, it considered that Mr Browns statements consisted largely of broad and unsupported assertions. Careful analysis of the evidence in the appendices to his statement about particular transactions exposed serious gaps. The court held that the judge had been wrong on 6 December to find on the material before him that there was reasonable cause to believe that the defendants had benefited from the alleged criminal conduct. It postponed the drawing up of a final order in relation to the defendants (as distinct from the companies) in order to give the CPS an opportunity to adduce further evidence. The CPS subsequently made a renewed application to Mackay J, which he refused. As to the companies, the Court of Appeal held that there was no good arguable case for regarding their assets as the assets of the defendants and it quashed the order in so far as it affected the companies with immediate effect. In his judgment refusing to discharge the order, the judge had concluded that there was a good arguable case that the defendants had attempted to shelter behind a corporate faade, or veil, to hide their crimes and their benefits from it; and that the business structures constituted a device, or cloak or sham intended to disguise the true nature of what was going on. The Court of Appeal referred to Mr Browns statement that it was probable that the companies conducted legitimate trade and that he did not know the ratio of legitimate to illegitimate activity. It observed that by the time of the application to set aside a good deal of evidence had been filed by the companies, from which they asserted that 95% of the business was demonstrably legitimate, and HMRC had been driven to concede that they were not in a position to dispute this. The court concluded that on the material before the judge, at the time of the ex parte hearing, there may have been some force in the argument put forward by the CPS; but that on the application to discharge the orders there was insufficient evidence to support the judges conclusion that there was reasonable cause to believe that the companies were just a front, sham or device behind which the defendants were sheltering in order to conceal fraud. The court said that, on the contrary, the evidence before it suggested that the vast bulk of the companies business was legitimate. That evidence was before the court at the time when the judge made his order on 14 December activating the receivers management powers, although the judge had not then had the opportunity of digesting it. The effective period of the receivership therefore lasted from 14 December 2010 (when the receivers management powers were activated) to 26 January 2011 (when the order was set aside by the Court of Appeal). A witness statement by the receivers solicitor explains in broad outline how the sum claimed by the receiver is made up. The largest items were 248,220 for chargeable time recorded and 229,399 for providing manned security at the companies sites. The reason for the latter figure being so large was that the receiver had information that many of the operatives at the sites were either unlicensed workers from overseas (some with criminal records) or had family connections to the defendants. The receiver therefore instructed professional security staff to protect the sites and the stock. A further significant item was the cost of the receiver obtaining legal advice and representation. This amounted to 143,044. It included counsels fees for appearance at the hearings before the judge on 14 and 23 December 2010 and at the hearing before the Court of Appeal. On the hearing of the present appeal the court was informed that no criminal charges had yet been brought in connection with the investigation but that the investigation is continuing. Statutory Framework The purpose of POCA is to prevent criminals form benefiting from their criminal conduct. The Act provides various means for achieving this aim. Part 2 provides a scheme for making confiscation orders in criminal proceedings. Sections 40 to 49 make provision for protective measures by way of restraint orders and receivership orders in order to preserve the realisable assets of a defendant or prospective defendant against whom there is a reasonable likelihood of a confiscation order being made. The conditions for making a restraint order are set out in section 40. Among other things, the court must be satisfied that there is reasonable cause to believe that the alleged defendant has benefited from his criminal conduct. It is not necessary that criminal proceedings should have been instituted, but a criminal investigation must have begun. If the necessary conditions are satisfied, the court may make an order under section 41 prohibiting any specified person from dealing with any realisable property held by him. Realisable property is defined in section 83 as any free property held by the defendant (or by the recipient of a tainted gift). Under section 82, property is free for this purpose unless it is already the subject of a forfeiture or deprivation order made under another statute such as the Terrorism Act 2000. A restraint order may be made subject to exceptions and the court may make such other order as it believes is appropriate for the purpose of ensuring that the restraint order is effective. A disclosure order is a common example. Section 42 provides for applications to vary or discharge a restraint order, and section 43 provides for an appeal to the Court of Appeal by a person affected by the decision on such an application. As a supplement to a restraint order, section 48(2) provides that the Crown Court may appoint a receiver in respect of any realisable property to which the restraint order applies. Since the appointment of a management receiver is by its nature an interim measure before any criminal proceedings have been determined, when appointing a receiver under section 48 the court does not have to make a final determination that the relevant property is realisable property within the meaning of the Act. It is enough that on the documents a good arguable case arises for treating the relevant assets as the realisable property of the defendant: Crown Prosecution Service v Compton [2002] EWCA Civ 1720. Section 49 provides so far as material: 1) If the court appoints a receiver under section 48 it may act under this section on the application of the person who applied for the restraint order. 2) The court may by order confer on the receiver the following powers in relation to any realisable property to which the restraint order applies a) power to take possession of the property; b) power to manage or otherwise deal with the property; c) power to start, carry on or defend any legal proceedings in respect of the property; d) power to realise so much of the property as is necessary to meet the receivers remuneration and expenses. 4) The court may by order authorise the receiver to do any of the following for the purpose of the exercise of his functions a) hold property; b) enter into contracts; c) sue and be sued; d) employ agents; e) execute powers of attorney, deeds or other instruments; f) take any other steps the court thinks appropriate. 5) The court may order any person who has possession of realisable property to which the restraint order applies to give possession of it to the receiver. 8) The court must not a) b) confer the power mentioned in subsection (2) (b) or (d) in respect of property, or exercise the power conferred on it by subsection (6) in respect of property. unless it gives persons holding interests in the property a reasonable opportunity to make representations to it. 9) The court may order that a power conferred by an order under this section is subject to such conditions and exceptions as it specifies. Section 61 provides: If a receiver appointed under section 48 a) takes action in relation to property which is not realisable property, b) would be entitled to take the action if it were realisable property, and c) believes on reasonable grounds that he is entitled to take the action, he is not liable to any person in respect of any loss or damage resulting from the action, except so far as the loss or damage is caused by his negligence. Section 63 provides that any person affected by a receivership order may apply to the Crown Court to vary or discharge the order. Section 65 provides for appeal to the Court of Appeal against decisions under various sections including 48, 49 and 63. Section 66 provides: (1) An appeal lies to the Supreme Court from a decision of the Court of Appeal on an appeal under section 65. (2) An appeal under this section lies at the instance of any person who was a party to the proceedings before the Court of Appeal. (3) On an appeal under this section the Supreme Court may i. confirm the decision of the Court of Appeal, or ii. make such order as it believes is appropriate. Section 72 gives power to the Crown Court to order payment of such compensation as it believes is just in cases where an order has been made under the part of the Act which includes receivership orders, but there are a number of conditions. There must have been serious default by, among others, a member of the CPS. The default must have been such that the investigation would not have continued if it had not occurred (or, where criminal proceedings were instituted, that the proceedings would not have started or continued). Moreover, under section 72(6) the application must be made by a person who held realisable property and has suffered loss in consequence of something done in relation to it by or in pursuance of the order. Section 72(6) presents a drafting problem because section 83 confines the meaning of realisable property to property of the defendant or a tainted gift. If construed literally, it would therefore not extend to property of a third party which was wrongly made the subject of a receivership order. This could present an obstacle for a person in the position of the companies in this case, but it is not necessary to try to resolve that problem for present purposes. The Act does not contain any provisions about the application of funds obtained by a management receiver (other than section 49(2)(d) which empowers the court to give power to the receiver to realise so much of the property as is necessary to meet his remuneration and expenses), but that is explicable because of the interim nature of a management receivership. The task of the management receiver is essentially to hold and protect the assets. Where criminal proceedings result in the making of a confiscation order, the court may appoint an enforcement receiver under section 50. For collection purposes, a confiscation order is treated in the same way as a fine; payment is made thorough the magistrates court. Section 55 contains provisions about how the justices chief executive is to deal with sums received on account of the amount payable under a confiscation order. They must be applied first in the payment of expenses properly payable to an insolvency practitioner and next in the payment of the remuneration and expenses of a receiver appointed under section 48, to the extent that they have not been met by the exercise of a power conferred under section 49(2)(d) (that is, to the extent that they have not been met by the receiver selling assets in order to meet his own remuneration and expenses). Under analogous provisions of the Criminal Justice Act 1988, which POCA replaced, section 88(2) contained a long stop provision in the following terms: Any amount due in respect of the remuneration and expenses of a receiver so appointed shall, if no sum is available to be applied in payment of it under section 81 (5) above, be paid by the prosecutor or, in a case where proceedings for an offence to which this Part of this Act applies are not instituted, by the person on whose application the receiver was appointed. By contrast, POCA contains no provision for payment of the receivers remuneration and expenses by the prosecutor or applicant for the receivership order. The Criminal Procedure Rules include a part dealing with receivership orders. Rule 60.6 provides: (1) This rule applies where the Crown Court appoints a receiver under section 48 or 50 of the Proceeds of Crime Act 2002 (2) The receiver may only charge for his services if the Crown Court a) b) so directs; and specifies the basis on which the receiver is to be remunerated. (4) The Crown Court may refer the determination of a receivers remuneration to be ascertained by the taxing authority of the Crown Court (5) A receiver appointed under section 48 of the 2002 Act is to receive his remuneration by realising property in respect of which he is appointed, in accordance with section 49(2)(d) of the 2002 Act. (6) A receiver appointed under section 50 of the 2002 Act is to receive his remuneration by applying to the magistrates court officer for payment under section 55(4)(b) of the 2002 Act. Domestic Case Law At common law it is an established general principle of receivership that a court appointed receiver is entitled to look for payment of his proper expenses and remuneration to the assets placed by the court in his control, and that the receiver has a lien over these assets for that purpose. It is also established that this principle applies as much to a receiver appointed under a statutory scheme as to any other court appointed receiver, unless the statute otherwise provides: Capewell v Revenue and Customs Commissioners [2007] UKHL 2, [2007] 1 WLR 386, especially paras 18 21. This is the first case in which this court has had to consider the compatibility of the application of that general principle with A1P1, in circumstances where the relevant assets were not the property of the defendant (or prospective defendant) and ought never to have been put into the hands of the receiver. In In re Andrews [1999] 1 WLR 1236 a father and son were prosecuted for VAT fraud. In the course of the proceedings restraint and receivership orders were made against them under the Criminal Justice Act 1988. The son was convicted but the father was acquitted. The receiver used some of the proceeds of the fathers assets to cover his legal costs and expenses. The father claimed to recover this sum from the receiver by way of costs but, as Aldous LJ observed, the claim was really a claim for compensation dressed up as an application for an award of costs. The Court of Appeal held that the receiver was entitled to charge his costs and expenses against the assets in receivership but added that no argument had been addressed to the court about possible breach of A1P1. An argument based on A1P1 was raised in Hughes v Customs & Excise Commissioners [2002] EWCA Civ 734, [2003] 1 WLR 177. Nicholas Hughes was charged with VAT fraud. Nicholas was the joint owner of a company with his brother Timothy, each holding 50% of the shares. Timothy was never charged. A restraint and receivership order was made against Nicholas, preventing the company from dealing in any way with its assets. Nicholas was acquitted but the assets of the company were used to meet the receivers costs and expenses. The Court of Appeal held that there was no breach of A1P1. Simon Brown LJ said: 55. I entirely accept that an acquitted (or indeed unconvicted) defendant must for these purposes be treated as an innocent person I cannot accept, however, that for this reason it must be regarded as disproportionate, still less arbitrary (another contention advanced by the respondents), to leave the defendant, against whom restraint and receivership orders have been made, uncompensated for such loss as they may have caused him unless, of course, by establishing some serious fault on the prosecutors part he can bring himself within the strict requirements of section 89. 56. It is common ground that acquitted defendants are not, save in the most exceptional circumstances, entitled to compensation for being deprived of their liberty whilst on remand or indeed for any other heads of loss suffered through being prosecuted. In my judgment it is no more unfair, disproportionate or arbitrary that they should be uncompensated too for any adverse effects that restraint and receivership orders may have had upon their assets. As to the position of Timothy, Simon Brown LJ said at para 58 that the court should be astute, wherever possible, to protect the rights and interests of third parties, but that it was difficult to regard this legislation as riding roughshod over the rights of innocent third parties. In that case Timothys interest in the company was inextricably tied up with that of his brother and there was no suggestion that the order was not properly made. Hughes was cited with approval in Capewell, but not on this point because in Capewell there was no argument about A1P1. In Capewell, a receivership order was properly made against the defendant under section 77(8) of the Criminal Justice Act 1988. The known assets of the defendant comprised some properties, some cars, some bank accounts and an unincorporated financial services business. The order provided for the receivers remuneration and expenses to be taken from the receivership assets. The receivership order was made on 30 January 2003. After about a year an application was made by the defendant for the discharge of the receiver. The application was heard by Lindsay J in April 2004 and was dismissed. The defendant appealed against that decision. While the case was pending in the Court of Appeal, a fresh application was made for the discharge of the receivership, which on this occasion was not opposed by the receiver. On 13 October 2004 Davis J ordered that the receiver be discharged on the pragmatic grounds that all the parties agreed that the expenditure and sums involved mean it simply does not make sense for the receiver to continue in office. The defendant continued with his appeal against the dismissal of his earlier application, and the Court of Appeal held that Lindsay J had misdirected himself in his approach to that application. The court found it difficult to assess how matters would have proceeded if the judge had asked himself the correct questions but it inferred that the date of discharge would have been likely to have been brought forward and, doing the best it could, it estimated that the likely date of discharge would have been 1 June 2004. The defendant submitted that the Revenue and Customs (who had obtained the order) should be responsible for the receivers remuneration and expenses for the period of four and a half months from 1 June 2004 to the date when the receivership order was discharged. The Court of Appeal considered that this would be just, and that it had power to make such an order under a recently introduced provision of the Civil Procedure Rules. The issue before the House of Lords was whether the relevant rule, CPR r 69.7, gave the court such power. The House of Lords held that the new rule did not introduce a fundamental change in the general law of receivership or in the position of receiverships under the 1998 Act or other comparable statute powers. As a further reason for reversing the Court of Appeals decision, Lord Walker observed at para 27 that a receiver takes on heavy responsibilities when he accepts appointment, and he is entitled to the security of knowing that the terms of his appointment will not be changed retrospectively, even if an appellate court later decides that the receivership should have been terminated at an earlier date. The issue for the House of Lords was therefore narrow. It was not disputed that the assets had been properly put into the hands of the receiver and there was no suggestion of a possible violation of A1P1. In Sinclair v Glatt [2009] EWCA Civ 176, [2009] 1 WLR 1845 the defendant was convicted of money laundering offences. In the course of the proceedings a restraint and receivership order was made against him relating to assets including properties of which he was the legal owner. The defendants former wife intervened claiming to be the beneficial owner of certain property and her claim was upheld. The receivership order was held to have been properly made, because the defendant was the legal owner of the property, and the Court of Appeal upheld the receivers claim to be entitled to a lien over it for his remuneration, costs and expenses. There was no argument about A1P1, but Elias LJ said obiter at para 42 that, given the potential injustice of the operation of the principle that the receivers can recover their costs and expenses from the receivership assets, he would not rule out the possibility that in an appropriate case A1P1 could limit the costs and expenses recoverable from an innocent third party. He added that he did not read the judgment of the Court of Appeal in Hughes as excluding that possibility. European Case Law Mr Perry relied on a number of cases in which the Strasbourg Court held that interim restraints imposed on a defendants liberty or use of his property in the course of criminal proceedings did not contravene the Convention or A1P1. Mr Jones submitted that these decisions were distinguishable and he referred to other decisions of the court about the general interpretation of A1P1 in support of his case. In Sporrong and Lonnroth v Sweden (1982) 5 EHRR 35 the Strasbourg Court was sharply divided over the proper interpretation of A1P1. A forceful minority judgment favoured holding that the second paragraph (beginning The preceding provisions shall not, however, in any way impair the right of a State. ) qualified the whole of the first paragraph. The majority held that A1P1 contains three separate and distinct rules. The first rule, expressed in the first sentence, is a rule of general application which recognises every persons right to peaceful enjoyment of his possessions. The second rule, in the second sentence, deals with measures which deprive a person of his possessions. Deprivation is permissible if, but only if, it is in the public interest and subject to the conditions provided for by law and by the general principles of international law. The third rule deals with the states power to enforce laws controlling the use by a person of his property but is not relevant to cases of deprivation of property, which are governed by a combination of rules 1 and 2. The court also stressed, at para 69, that for the purpose of deciding whether there has been a breach of the first rule, the Court must determine whether a fair balance was struck between the demands of the general interest of the community and the requirements of the protection of the individuals fundamental rights. The search for this balance is inherent in the whole of the Convention and is also reflected in the structure of article 1. In James v United Kingdom (1986) 8 EHRR 123, para 37, the court clarified what it meant by A1P1 comprising three distinct rules. The court said that the three rules were not distinct in the sense of being unconnected. The second and third rules were concerned with particular instances of interference with the right to peaceful enjoyment of property and were therefore to be construed in the light of the general principle clearly enunciated in the first rule. The court rejected an argument that the public interest test in the deprivation rule is satisfied only if the property is taken for the use or benefit of the public at large. It held that a taking of property effected in pursuance of legitimate social, economic or other policies may be in the public interest; that the margin of appreciation open to a national legislature in implementing social and economic policies is a wide one; and that the court will respect its judgment as to what is in the public interest unless that judgment is manifestly without reasonable foundation (paras 39 to 45). However, in order for a taking of private property to be compliant with A1P1, not only must the measure under which the property is taken pursue a legitimate aim in the public interest, but there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised. The court in James repeated its statement in Sporrong that a fair balance must be struck between the demands of the general interest of the community and the requirements of the protection of the individuals fundamental rights, and it added that the requisite balance will not be found if the person concerned has had to bear an individual and excessive burden (para 50). The court held that the requirement in the deprivation rule that the taking must be in accordance with the general principles of international law does not apply to a taking by a state of the property of its own nationals (para 66). However, the court stated that the requirement that any taking shall be subject to the conditions provided for by law refers not merely to municipal law but relates also to the quality of the law, requiring it to be compatible with the rule of law and not arbitrary (para 67). In Lithgow v United Kingdom (1986) EHRR 329 the court held that the phrase subject to the conditions provided for by law requires the existence of and compliance with adequately accessible and sufficiently precise domestic legal provisions (para 110). As to the need for a reasonable relationship of proportionality between the means employed and the aim sought to be realised, and the requirement that a balance must be struck between the general interest to the community and protection of the individuals fundamental rights, it said that the taking of property without reasonable compensation would normally constitute a disproportionate interference (paras 121 to 151). The cases of Sporrong, James and Lithgow contain important statements of general principle (as this court recognised in AXA General Insurance Ltd v HM Advocate [2011] UKSC 46, [2012] 1 AC 868), but they were not cases of property being taken for purposes connected with criminal proceedings. In that context I come next to the cases on which the receiver and the CPS rely. In Raimondo v Italy (1994) 18 EHRR 237 the applicant was arrested and placed under house arrest on charges relating to his association with the Mafia. As an interim measure some of his property was seized. The proceedings ended in his acquittal. He claimed that the seizure of his property was a violation of his rights under A1P1 but his complaint was dismissed. The court held that the seizure, as a provisional measure intended to ensure that property which appeared to be the fruit of unlawful activities carried out to the detriment of the community could subsequently be confiscated if necessary, was justified by the general interest. In view of the extremely dangerous economic power of an organisation like the Mafia, it could not be said that taking the step of seizing the property at an early stage of the proceedings was disproportionate to the aim pursued. There was an additional complaint that the property was not only seized but confiscated. However, the confiscation order was rescindable and had in fact been rescinded. In practical terms it entailed no additional restriction to the seizure, and therefore the respondent state was held not to have overstepped the margin of appreciation available to it. The acquitted defendant in Andrews (referred to in para 45) took his case to Strasbourg: Application No 49584/99, 26 September 2002. He complained that the use of his assets to cover the receivers legal costs and expenses was a breach of his rights under A1P1 but his complaint was dismissed as manifestly ill founded. The court observed that the applicant had not argued that there was insufficient evidence on which to base the charges made against him; that he had specifically referred to his close involvement with the transport company when declaring his assets; that the proper administration of the affairs of the company was obviously in the applicants own interest; and that he was consulted by the receiver in the monitoring of the company. The court said: Having regard to these considerations, the Court is not persuaded that the applicant was required to bear an individual and excessive burden through having to fund the costs and expenses incurred by the receiver . It is true that the applicant was ultimately acquitted of the charges brought against him. However, it is equally true that at the time of the execution of the Restraint and Receivership Orders there was a case against him which required to be answered, and necessary steps had to be taken to preserve assets in respect of which he had more than a peripheral interest. In these circumstances, and having regard also to the absence of any arbitrariness in the impugned decisions, the Court does not consider that the authorities can be said to have failed to strike a fair balance between the applicants property right and the general interests of the community. The government in Andrews accepted that there had been an interference with the applicants right to the peaceful enjoyment of his property. The applicant argued that there had been a deprivation of his property within the meaning of the second sentence of A1P1. The court considered that the initial seizure had been an exercise of control over the use of the property, in order to ensure that it would be available for payment of revenue owed by him in the event of his conviction, and that payment of the receivers costs out of the property should be regarded as part of the exercise by the state of the rights reserved to it under the second paragraph of A1P1 and therefore served a legitimate aim. I have no difficulty with the courts view that there was a legitimate aim, but that is different from the question whether there was a deprivation of assets. The court seems to have regarded the payment of the receiver as money spent on the preservation of the applicants property and therefore not a deprivation; in other words, expenditure of funds for the benefit of the property was not to be regarded as a deprivation. That would account for the courts emphasis on the fact that the proper administration of the affairs of the company was obviously in the applicants own interest and that he was consulted by the receiver in the monitoring of the company. If so, that was a conclusion on the particular facts of that case, rather than a principle of law of general application, and its relevance was to the courts judgment about whether the applicant was required to bear an individual and excessive burden. In Benham v United Kingdom (1996) 22 EHRR 293 the applicant was committed to prison by a magistrates court for non payment of a community charge. The Divisional Court held on appeal that the magistrates had been wrong to do so. The applicant complained that his imprisonment was a violation of his rights under article 5 and that he had an enforceable right to compensation under article 5(5). The Strasbourg Court rejected his complaints. It held that his detention had been lawful within the meaning of article 5 because it was carried out pursuant to a court order. The subsequent finding that the court had erred under domestic law in making that order did not retrospectively affect the validity of his period of detention. His detention had not been arbitrary. There was no suggestion that the magistrates had acted in bad faith or that they had not attempted to apply the relevant legislation correctly. The law which the magistrates had to apply was not straightforward. Their decision had been erroneous but they had acted, albeit mistakenly, within their lawful jurisdiction. By contrast, in Frizen v Russia (2005) 42 EHRR 388 the Court held that a confiscation order made by a Russian criminal court was unlawful and involved a violation of the applicants rights under A1P1. The husband was convicted of fraud. She was not herself charged with any criminal offence. After his conviction the court made a confiscation order in respect of her husbands property and it included in the confiscation order a vehicle which the applicant maintained had been bought from money which she had borrowed and belonged to her. However, it failed to identify any legal basis justifying the confiscation. Judgment of Underhill J Quoting from the judgment of Simon Brown LJ in Hughes, Underhill J said that the essential questions arising under A1P1 were whether the measures taken were (i) in the public interest, (ii) appropriate for achieving their aim, (iii) proportionate and (iv) achieved a fair balance between the demands of the general interest of the community and the requirements of the protection of the individuals rights. He concluded that it would be a breach of the companies rights under A1P1 if they had ultimately to bear the burden of the receivers costs and expenses. Underhill J distinguished Hughes on the grounds that in that case the order had been properly made, notwithstanding the eventual acquittal (or non prosecution) of the alleged defender, and the adverse affects on the third party were the consequence of his having the misfortune to share an interest in property with someone reasonably suspected of involvement in serious crime. Underhill J continued: But the situation seems to me fundamentally different where the adverse effect on the third party is the result not of his sharing property rights with the alleged offender but of his property being treated, wrongly and without sufficient evidence, as property in which the alleged offender has an interest. It does not seem to me that the public interest justification endorsed in Hughes has any application to such a case: the third partys assets are simply confiscated to fund the execution of an order that should not have been made in the first place. Underhill J referred to some remarks in Sinclair v Glatt which could be taken as suggesting that an adverse impact on a third party might be disproportionate in the case of a stranger but justifiable where the parties were sufficiently closely associated. He noted that in the present case there was a close connection between the companies and the alleged offenders, and that it might be the case (as yet unproved) that the companies had been used to some extent in carrying out the alleged offences. He accepted that where the third party and the alleged offender shared an interest in property the nature of their association might be relevant in deciding whether the third party should bear the resulting cost of the receivership, but he regarded the case as different where the third partys property was unequivocally his own and there was no basis for a receiver being appointed over it. If there was sufficient ground for believing that the companies themselves were not innocent in relation to the alleged offending, the right course in his view was for the companies to be treated as alleged offenders in their own right. Underhill J went on to consider the position of the receiver and the CPS. He observed that to deny the receiver his remuneration would be an unacceptable way of vindicating the companies rights and would involve remedying one injustice only by creating another. The receiver took charge of the companies assets as an officer of the court, and incurred expenditure and liabilities on the faith of a court order which was valid and effective until discharged by the Court of Appeal. He had no responsibility for the fact that the order was wrongly made and it would be intolerable that he should not be entitled to be paid, from one source or another, his proper fees and expenses. Underhill J considered that section 3 of the Human Rights Act 1998 enabled him to interpret POCA as giving the court the right, in circumstances such as those of the present case, to order that the receivers remuneration and expenses be paid by the CPS. On that basis he ordered the CPS to pay the receivers remuneration and legal costs (subject to an assessment by the taxing authority of the Crown Court). Judgment of Mitting and Edwards Stuart JJ The majority of the Court of Appeal began by noting that it was settled law at Strasbourg that A1P1 comprises three distinct rules (Sporrong). Since the receivers application to use the assets of the company to meet his remuneration and expenses involved a taking and not merely an interference with the use of the companies property, the relevant rule was the second rule, contained in the second sentence of A1P1. The majority correctly noted that the general principles of international law were irrelevant for present purposes. The question was whether depriving the companies of their assets for the purpose of paying the receiver would meet the requirements of being in the public interest and subject to the conditions provided for by law. The majority concluded that the proposed taking of the companies assets would not comply with the conditions required by law. Their reasoning process was as follows: 1) Before assets could properly be made the subject of a receivership order, there must be reasonable cause to believe that the alleged offender had benefited from his criminal conduct (section 40(2)(b) of POCA) and there must be a good arguable case for treating particular assets as the realisable property of the defendant (CPS v Compton). 2) The first condition was not satisfied on either 6 or 23 December 2010 and the second was not satisfied on 23 December 2010. 3) It was true that deprivation of the companies property to pay the remuneration and expenses of the receiver was authorised by law in a superficial sense, in that it is a settled principle of receivership law that a receiver is entitled to be paid his remuneration and assets out of the assets he is appointed to receive and manage. 4) However, that proposition was subject to an important caveat: the conditions upon which a restraint order may be made and a receiver appointed must first be satisfied. If they are not, there is no lawful basis for the appointment of a receiver in respect of property belonging to an alleged offender, still less property belonging to a third person. 5) In order to determine the issue of lawfulness for the purpose of the second rule under A1P1, the court must look to the underlying lawfulness of the receivers appointment. 6) The bare fact that the receiver had been appointed by order of a court was not sufficient to authorise the deprivation: Frizen v Russia. The majority held, in agreement with Laws LJ, that Underhill J had been wrong to hold that POCA could be interpreted in such a way as to give the court power to order the receivers remuneration and expenses to be paid by the CPS. They recognised the unsatisfactoriness of the outcome, since the receiver had been appointed by the court, on the application of the CPS, had undertaken work and incurred expenses in the legitimate understanding that he would be rewarded and recompensed out of assets identified by the CPS. Their judgment left open the possibility that the receiver might have a common law remedy, but they did not elaborate on this, presumably because the point had not been developed in argument. Judgment of Laws LJ Laws LJs analysis began logically with domestic law. The setting aside of the receivership order by the Court of Appeal did not render the order under which the receiver was appointed a nullity ab initio. The Crown Court order had the force of law until it was set aside and the setting aside of the order did not retrospectively deprive the receiver of his right to remuneration under it. As Laws LJ pithily put it, The Crown Courts order is therefore good until set aside; and this is so whatever the basis on which it is set aside. The terms of the receivers appointment and his remuneration, costs and expenses were within the courts power to order (under section 49(2)(d) and the criminal procedure rules), and they entitled the receiver to recover his proper remuneration and expenses out of the companies assets. Laws LJ disagreed with the majoritys interpretation of the conditions provided for by law under A1P1. The conditions provided for by law were soundly constituted by (i) the material provisions of POCA, (ii) the order made by the Crown Court on 6 December 2010, (iii) the common law rule that the orders of a superior court of record are good until set aside and (iv) the common law rule that a receiver is entitled to be paid his remuneration and expenses out of the assets he is appointed to receive and manage, which gave a long standing historic context to the orders effect and vindicated the principle of legal certainty. Laws LJ went on to consider the requirement of proportionality. He cited Raimondo as an authority showing that statutory regimes of seizure and confiscation by the state may well be justified under A1P1 for the prevention of crime and that the Strasbourg Court will allow a margin of appreciation to the state. There could be no argument as to the POCA regimes legitimate aim, which was to preserve property for the satisfaction of confiscation orders made to strip criminals of the fruits of their crime. The Act constituted the judgment of Parliament as to how a fair balance between the demands of the general interest of the community and the requirements of the protection of the individuals right should be struck in this area. Parliaments judgment leant heavily towards the general interest, although there are careful, but limited, protections for the individual (notably in sections 61 and 72). Given the respect owed by domestic courts, and the Strasbourg Court, to Parliaments judgment as to how the balance between general interest and private right was to be struck, Laws LJ considered that A1P1 would only very rarely be violated on proportionality grounds by the effects of a receivership order. This was not in his judgment such a case. On Laws LJs approach to A1P1, the question of the courts power to order recovery of the receivers remuneration and expenses against the CPS would not have arisen, but he addressed it in view of the decision of the majority on the A1P1 issue. He noted that no express provision of POCA gave the court any such power. The question was whether section 3 of the Human Rights Act allowed the court to interpret or read down the statute so as to find such a power. There was no provision in the Act which might be amenable to that process of interpretation, and the policy of the statute was that the receivers right to recover his expenses from the receivership properly applied in every instance (unless different arrangements were made by contract). In those circumstances he concluded that there was no power in the court to make an order against the CPS. A1P1: discussion Since the present case involves deprivation of the companies assets, and not merely control of their use, the Court of Appeal identified the second of Sporrongs three rules as the key provision: No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law [and by the general principles of international law]. As the court recognised, the reference to international law is irrelevant in the case of a taking by a state of the property of its own nationals. The critical questions are those addressed by Laws LJ: (1) whether the proposed taking is in accordance with conditions provided for by law; (2) if so, whether the measure relied upon to justify the taking has a legitimate aim; (3) if the first and second conditions are each satisfied, whether the taking strikes a fair balance between the general interest of the community and the requirements of the protection of the companies right to peaceful enjoyment of their possessions. On the question of lawfulness, Mr Jones submitted that the majority of the Court of Appeal were right in their analysis (summarised in para 71 above). Mr Perry and Mr Parroy submitted that the majority were wrong and that Laws LJ was correct in his analysis (summarised at paras 73 to 75 above). On this issue I agree with Laws LJ for the reasons given by him and I cannot improve on his analysis. Mr Jones sought to uphold the approach of the majority by reference to the observations of the Strasbourg Court in James at para 67 (referred to at para 58 above) to the effect that the expression the conditions provided for by law in A1P1 refers not merely to municipal law but also to the quality of the law. The point which the Strasbourg Court was making was that the relevant conditions must comply with the rule of law in terms of clarity, accessibility and lack of arbitrariness. The relevant provisions of POCA together with the common law of receivership (the Criminal Procedure Rules) amply satisfy the requirements of the rule of law. Frizen v Russia, on which Mitting and Edwards Stuart JJ placed some reliance, was not a comparable case because the state in that case was unable to identify any provision of domestic law under which the order had been made. Laws LJ was plainly right that as a matter of domestic law the appointment of the receiver was valid until the Court of Appeal set aside the order appointing him. Under domestic law the Crown Court had power to order that the receivers remuneration and expenses should be taken from the assets placed in his control. The setting aside of the receivers appointment did not retrospectively affect his entitlement to be paid out of those assets for his proper remuneration and expenses during the period of the receivership. Next, Mr Jones submitted that the measure relied on to justify payment of the receivers remuneration and expenses out of the assets of the companies was not in the public interest because it lacked a legitimate aim. Its aim, he submitted, was to enable the state to place the cost of an order which ought never to have been made on to the person against whom it was made, and that this was not a legitimate purpose. However, that is to start at the wrong end. It is to deduce the aim by reference to the result rather than to look at the measure itself in order to see what is its true aim. The safety valve against a measure with a legitimate aim being relied upon to produce an unjustifiable result is the separate requirement of proportionality. The Strasbourg Court has adopted a generous approach to the public interest test, allowing a wide measure of appreciation to a national legislature in determining what it considers to be in the public interest (see James, referred to at para 56 above). The aim of the legislature in enabling the court to appoint an interim receiver under section 48 was to preserve property pending the conclusion of criminal proceedings and the possible making of a confiscation order. A professional receiver would have to be paid, and the purpose of allowing the court to apply the usual common law principle as to the payment of receivers was to enable the receivership to operate like any other. I agree with Laws LJ it was open to Parliament to form the judgment that this would serve the legitimate public interest in combatting crime by making it unprofitable. The critical question is whether in the circumstances of the present case an order that the receivers costs and expenses should be met out of the companies assets is disproportionate, in that it would not achieve a fair balance between the interest of the community and protection of the companies right to their own property. I start from the position that the taking of property without compensation will normally be a disproportionate interference with a persons A1P1 rights. Although this was said in a case about compulsory purchase, it is a general principle, but it is only a starting point. To give an obvious example, a confiscation order under POCA is a taking of property without compensation, but it is done for the salutary purpose of depriving a criminal of the proceeds of his crime. A restraint order and receivership order may also be proportionate if reasonably ancillary to that process. In Andrews the Strasbourg Court judged that it was not disproportionate that the costs of a receivership should be taken from the assets of the defendant notwithstanding his ultimate acquittal. However, in its reasoning the Court highlighted the fact that there was a case against the applicant, which required to be answered, and that necessary steps had to be taken to preserve assets in which he had more than a peripheral interest. Sometimes too it may happen that an innocent third partys affairs are so intermingled with the defendants as to give reasonable cause to believe the defendant to be the owner of assets which are ultimately found to belong to a third party, but that is not the present case. In this case, the companies were neither defendants nor was there reasonable cause for regarding their assets as the assets of the defendants on the evidence before the court at the time when the receivership order against them was made effective (14 December 2010). Whilst those facts did not make the receivership order legally invalid under domestic law during the period until it was set aside, they are the cornerstone of the companies argument that it would be disproportionate and unfair to require them to pay the costs of the receivership. Mr Perry and Mr Parroy submitted that although it must now be accepted that the receivership order ought never to have been made, the court should adopt a similar approach to that of the Strasbourg Court in Benham (referred to in para 62 above). In that case the applicant was imprisoned under an order which ought not to have been made, but the matter was complex and the magistrates acted in good faith. It was held that there was therefore no breach of article 5. By parity of reasoning it was argued that the court should conclude that to require the companies to bear the costs of the receivership would not infringe A1P1, because (as is true) the order under which the receiver seeks to recover his remuneration and expenses from the companies was made by the Crown Court in good faith and the matter was complicated. Simon Brown LJ drew a similar analogy between article 5 and A1P1 in Hughes, referred to at para 46 above, when he said that it was no more unfair, disproportionate or arbitrary that an acquitted defendant should be uncompensated for any adverse effects of a restraint or a receivership order than that he should be uncompensated for loss of liberty whilst on remand. I am not persuaded that the analogy is apt. It is true that a remand in custody and the appointment of a management receiver are both forms of interim restraint and both may cause the individual to suffer financial loss as a side effect, but it is not right simply to lump together different forms of loss and assume that the Convention applies in the same way to them all. If the companies were claiming to recover trading losses resulting from the impact of their business being put into the hands of the receiver, it would be a claim for loss by interference with their property, to which the third rule in Sporrong would apply. It could be said that there would be an analogy between a claim for that kind of loss and a claim for loss resulting from the interim detention of the individual. I see the argument that it would be strange that a person who is remanded in custody and whose property is made the subject of a restraint and receivership order should be disentitled to claim for the loss of earnings resulting from his personal detention but might be entitled to claim for loss of trading opportunities resulting from the restraint on his property. I see also the argument that it might have a chilling effect on prosecutors if they faced the prospect of possibly having to make good trading losses during the period of a receivership, which might be considerable but would be hard to estimate and over which the prosecution would have no control. However, the court is not considering a claim of that kind. The companies are resisting an application by the receiver to take his expenses and remuneration out of their companies assets. It is quite different from a claim for compensation for a period of remand in custody. If one wanted to find an analogy with a defendant remanded in custody, the nearest equivalent would be if the assets of the defendant were sought to be used to defray the costs of detaining him and the legal proceedings. The important point for present purposes is that whereas incidental loss (such as trading loss) which a person may suffer as a by product of an interim restraint would come under the third rule in Sporrong, as loss resulting from the states interference with the property, the Court of Appeal were right to identify the second rule as the relevant rule in this case because it concerns a proposed taking of the companies assets. In support of their argument for regarding the taking as a proportionate measure, Mr Perry and Mr Parroy drew attention to the protections for the individual which are built into the relevant part of POCA, including particularly section 49(8), set out in para 34 above. Under that subsection the court must not activate any power given to the receiver to manage the property, or realise assets for the purpose of meeting his remuneration and expenses, until any person holding an interest in the property has had a reasonable opportunity to make representations. That provision is designed to minimise the risk of the court making a wrongful order such as was made in this case, but I do not see that a taking is rendered proportionate by the existence of a protective provision which failed to operate as it should. Indeed the opposite could be argued. This case is distinguishable from Raimondo, Andrews, Hughes, Capewell and Sinclair v Glatt, because all those cases were decided on the premise that the original receivership order was rightly made. In Sinclair v Glatt the applicant was not the defendant, but the relevant property was in the defendants legal ownership and was therefore held to be properly included in the receivership order. In the present case, however, not only were the companies not defendants, but at the time when the receivers powers were activated there was no reasonable cause to believe that their assets were assets of the defendants. The question is whether on those facts it strikes a fair balance between the general interest of the community and the protection of the companies rights to the peaceful enjoyment of their property that the companies assets should be taken to pay for the costs and remuneration of the receiver. At this point I part company with Laws LJ and agree with Underhill J that this would not be a fair balance. As Lord Reed observed in AXA General Insurance Ltd v HM Advocate at para 128, the assessment of proportionality requires careful consideration of the particular facts. In this instance there was no good arguable case for assimilating the companies assets with those of the defendants, and Underhill J aptly described it as simply a confiscation of a third partys assets to fund the execution of an order that should not have been made in the first place. In Capewell Lord Walker at para 25 described the relationship between the general law of receivership and the detailed provisions of the Criminal Justice Act 1988 (for which one must now substitute POCA) as somewhat opaque. Section 49(2)(d) empowers the court to authorise the receiver to realise so much of the property as is necessary to meet his remuneration and expenses in accordance with the ordinary law of receivership. However, the court as a public authority must not exercise its power in such a way as to breach the companies rights under A1P1. At the same time a real difficulty arises from my conclusion that the companies rights would be violated if the receivers application to use their assets to meet his remuneration and expenses were granted (and similarly if he were permitted to retain money already taken by him, subject to any further evidence and submissions for which Underhill J gave permission in his order referred to in para 4(iii) above). Nobody on the hearing of this appeal has disputed the courts jurisdiction not only to set aside the receivership order (as has happened) but to refuse the receivers application, if it concludes as I do that it would involve a violation of the companies A1P1 rights, but Underhill J correctly recognised that simply to refuse the application would replace one injustice with another. As Lord Walker said in Capewell, a receiver who accepts appointment by a court is entitled to know that the terms of his appointment will not be changed retrospectively. Moreover it is an ordinary part of receivership law that a receiver has a lien for his proper remuneration and expenses over the receivership property. To take away that right without compensating him would violate the receivers rights under A1P1. Unless it is within the power of the court to ensure that the receiver receives his recompense for which the lien is a security by some other means, the court will be left in the invidious position of violating the companies A1P1 rights if the receivers application is allowed and violating the receivers A1P1 rights if it is refused. That leads to the question whether the court has power to order that the receivers proper remuneration and expenses should be paid by the CPS. Relationship between the receiver and the CPS I agree with the Court of Appeal that it is not possible to locate within POCA a power to order the CPS to pay the receivers remuneration and expenses. Underhill J did not identify how this might be done and Mr Perry was not able to do so. Adopting an alternative approach suggested by the court, Mr Perry argued that the receiver was induced to accept his appointment on the promise or expectation of being able to recoup his expenses and remuneration from the property over which he was appointed to act, although the receiver accepted the financial risk that those assets might be of insufficient value. The terms on which the CPS asked the receiver to agree to act were set out in the letter to which I have referred. The relevant provisions are set out in paras 19 and 20. The letter included the statement that the receiver would have a lien over the defendants assets and that the CPS did not undertake to indemnify him if those assets were insufficient. The appointment by the court was made on the terms of the agreement between the CPS and the receiver, and the receivership assets included the assets of the company which were expressly included in the terms of the court order. The effect of my conclusion on A1P1 is that the lien is unenforceable. There is an argument that the statement you will have a lien over the defendants assets for payment of your fees should be interpreted as a promise that the receiver would have a legally enforceable lien over the receivership property, whatever its value might be, but to resort to that solution would involve a strained and artificial construction of the letter. The alternative is that the CPS made no such promise to the receiver, but that this was their mutual expectation and was the premise on which the receiver agreed to act. If the latter is the preferable analysis, does the receiver have a remedy against the CPS under the law of restitution or unjust enrichment? The current preference among scholars of the subject is to call it unjust enrichment rather than restitution. An example is the renaming of Goff and Jones seminal textbook. The first seven editions were entitled The Law of Restitution but the title of the eight edition (2011) has been changed to The Law of Unjust Enrichment. What matters is the content, and the words unjust and enrichment are both in some respects terms of article Enrichment requires the obtaining of a benefit, which may include the provision of services, as correctly stated by Professor Andrew Burrows in his Restatement of the English Law of Unjust Enrichment, 2012, at p 7. The CPS plainly perceived that there would be benefit to the public in the companies assets being removed from their control and placed in the hands of an independent receiver while its criminal investigation was proceeding. As to the unjust element in an unjust enrichment claim, I agree with the following overview in the current edition of Goff and Jones at para 1 08: the unjust element in unjust enrichment is simply a generalisation of all the factors which the law recognises as calling for restitution [a citation from the judgment of Campbell J in Wasada Pty Ltd v State Rail Authority of New South Wales (No 2) [2003] NSWSC 987 at [16], quoting Mason & Carter, Restitution Law in Australia (1995), 59 60]. In other words, unjust enrichment is not an abstract moral principle to which the courts must refer when deciding cases; it is an organising concept that groups decided authorities on the basis that they share a set of common features, namely that in all of them the defendant has been enriched by the receipt of a benefit that is gained at the claimants expense in circumstances that the law deems to be unjust. The reasons why the courts have held a defendants enrichment to be unjust vary from one set of cases to another, and in this respect the law of unjust enrichment more closely resembles the law of torts (recognising a variety of reasons why a defendant must compensate a claimant for harm) than it does the law of contract (embodying the single principle that expectations engendered by binding promises must be fulfilled). An important part of this branch of law is concerned with cases where money is paid or benefits are conferred for a consideration which has failed. Burrows Restatement at p 86, accommodates this within the concept of unjust enrichment by stating that a defendants enrichment is unjust if the claimant has enriched the defendant on the basis of a consideration that fails. Confusion is sometimes caused by the fact that the term consideration, when used in the phrase failure of consideration as a reason for a restitutionary claim, does not mean the same thing as it does when considering whether there is sufficient consideration to support the formation of a valid contract. Viscount Simon LC explained this in Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1943] AC 32, 48: In English law, an enforceable contract may be formed by an exchange of a promise for a promise, or by the exchange of a promise for an act . but when one is considering the law of failure of consideration and of the quasi contractual right to recover money on that ground, it is, generally speaking, not the promise which is referred to as the consideration, but the performance of the promise. To avoid this confusion, Goff and Jones suggest, at paras 12 10 to 12 15, that the expression failure of basis is preferable to failure of consideration because it accurately identifies the essence of the claim being pursued. Whichever terminology is used, the legal content is the same. The attraction of failure of basis is that it is more apt, but failure of consideration is more familiar. Failure of basis, or failure of consideration as it has been generally called, does not necessarily require failure of a promised counter performance; it may consist of the failure of a state of affairs on which the agreement was premised. A succinct summary of the meaning of failure of consideration was given by Professor Birks in his An Introduction to the Law of Restitution (1989), p 223 (cited with approval by the Court of Appeal in Sharma v Simposh Ltd [2011] EWCA Civ 1383, [2013] Ch 23, para 24): Failure of the consideration for a payment . means that the state of affairs contemplated as the basis or reason for the payment has failed to materialise or, if it did exist, has failed to sustain itself. In the present case the receiver has lost his lien. Professor Birks reference to failure of the consideration for a payment would apply equally to failure of the consideration for the provision of services. The present case involves both; the receiver made payments for the protection of the receivership property (in particular by the employment of security guards) and also provided professional services for which he seeks remuneration. The point that a failure of consideration may consist of the failure of a non promissory event or state of affairs is reiterated in Burrows Restatement at pp 86 87. He states that consideration which fails may have been an event or a state of affairs that was not promised, and he cites the decision of the High Court of Australia in Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 as an example of a failure of a non promissory condition as to the future. Rothmans were licensed to act as wholesalers of tobacco products under a New South Wales statute. They sold products to retailers for a price including licence fees, which were in reality a form of indirect taxation, payable by Rothmans to the New South Wales government. The Act imposing that liability on Rothmans was held by the High Court to be unconstitutional. The retailers then sued Rothmans to recover the amounts which they had paid in respect of the tax which had until then been unlawfully imposed on Rothmans. The retailers argued unsuccessfully that there was an implied agreement under which they could claim repayment of any unpaid tax. This argument was described in the leading judgment of Gleeson CJ, Gaudron and Hayne JJ, as artificial and unconvincing (para 20). However, the retailers succeeded in restitution. Gleeson CJ, Gaudron and Hayne JJ, stated at para 16 that Failure of consideration is not limited to non performance of a contractual obligation, although it may include that. They also rejected Rothmans argument that the restitution claims failed because there had not been a total failure of consideration, by interpreting the consideration for the total payments made by the retailers as containing severable parts. Gummow J (concurring), in a passage at para 72 with which I agree, advocated caution in judicial acceptance of any all embracing theory of restitutionary rights and remedies founded upon a notion of unjust enrichment. To the lawyer whose mind has been moulded by civilian influences, the theory may come first, and the source of the theory may be the writing of jurists not the decisions of judges. However, that is not the way in which a system based on case law develops; over time, general principle is derived from judicial decisions upon particular instances, not the other way around. After reviewing the authorities Gummow J held, at paras 101 to 102, that failure of consideration in this area of law may include the collapse of a bargain, which need not be contractual in nature. He held at para 104 that there had been no failure in the performance by Rothmans of any promise made by them, but that there had been a failure of consideration in the failure to sustain itself of the state of affairs contemplated as a basis for the payments the appellants seek to recover. Similarly, in the present case the receiver agreed to accept the burden of management of the companies on the basis that he would be entitled to take his remuneration and expenses from the companies assets, and that state of affairs which was fundamental to the agreement has failed to sustain itself. It might nevertheless be argued that there has not been a total failure of consideration, because the restraint and receivership order included assets of the defendants other than the assets of the companies. There is a lively academic debate whether it is an accurate statement of law today that failure of consideration cannot found a claim in restitution or unjust enrichment unless the failure is total, but that point has not been fully argued and it is unnecessary to decide it in this case. Modern authorities show that the courts are prepared, where it reflects commercial reality, to treat consideration as severable. Rothmans itself is an example. Another example cited by Burrows is the decision of the Court of Appeal in D O Ferguson & Associates v M Sohl (1992) 62 BLR 1995. That case involved a building contract which was repudiated by the builders at a time when the works had been partly completed. The contract price was approximately 32,000. At the time when the builders abandoned the site they had been paid over 26,000 and the value of work done by them was about 22,000. It was held that the owner was entitled to claim in restitution for the sum of 4,673, representing the amount by which the sums paid to the builders exceeded the value of the work done. The builders objected that there had not been a total failure of consideration under the contract, since most of the building work had been done, but the court held that there had been a total failure of consideration for the amount by which the builders had been overpaid. In the present case there was a total failure of consideration in relation to the receivers rights over the companies assets, which was fundamental to the basis on which the receiver was requested by the CPS and agreed to act. I use the expression fundamental to the basis because it should not be thought that mere failure of an expectation which motivated a party to enter into a contract may give rise to a restitutionary claim. Most contracts are entered into with intentions or expectations which may not be fulfilled, and the allocation of the risk of their non fulfilment is a function of the contract. But in the present case the expectation that the receiver would have a legal right to recover his remuneration and expenses was not just a motivating factor. Nobody envisaged that the receiver should provide his services in managing the companies as a volunteer; those services were to be in return for his right to recover his remuneration and expenses from the assets of the companies, such as they might be. The agreement between the CPS and the receiver so provided, and that provision was incorporated into the order of the court. I would hold that the CPS fulfilled its contractual obligations to the receiver by ensuring that the order appointing him conformed with the terms of the underlying agreement between them, but that the receiver is entitled to recover his proper remuneration and expenses from the CPS because the work done and expenses incurred by the receiver were at the request of the CPS and there has been a failure of the basis on which the receiver was asked and agreed to do so. Disposal I would uphold the Court of Appeals decision dismissing the CPSs appeal from the refusal by Underhill J to make an order permitting the taking of the companies assets to meet his remuneration and expenses, essentially for the reasons given by Underhill J. I would allow the receivers appeal against the Court of Appeals decision in relation to the CPS and reinstate the order of Underhill J referred to at para 4 above (but for different reasoning). Lessons for the future In the judgment of the Court of Appeal referred to at para 24 above, Hooper LJ deplored the fact that the original application was made at short notice to a judge who was in the middle of conducting a heavy trial and with only a limited time available for considering it. It should be axiomatic that, as he said, an application of this complexity should be listed before a judge with sufficient time to read and absorb the papers and with sufficient time to conduct a proper hearing. The problem was compounded in this case by the lack of proper opportunity which the judge had to consider the evidence lodged by the companies before he made the critical decision to implement the receivers powers. When the CPS is proposing to seek a restraint order, and particularly a restraint order coupled with a receivership order, it should give as much advance notice to the listing office as it reasonably can, together with a properly considered estimate of the time likely to be required for pre reading and for the hearing of the application. If other trials are not to be interrupted, the listing office will need proper time to make the necessary arrangements under the supervision of the resident judge, who may well need to consult the presiding judge and should certainly do so in complex cases, which may merit being heard by a High Court judge. The fact that such applications are made ex parte, and the potential seriousness of the consequences for defendants (at this stage presumed to be innocent) and for potential third parties, mean that there is a special burden both on the prosecution and on the court. Hughes LJ spelt this out plainly and emphatically in In re Stanford International Bank Ltd [2010] EWCA Civ 137, [2011] 1 Ch 33, para 191, in a passage (cited in An Informer v A Chief Constable [2012] EWCA Civ 197, [2013] QB 579, para 71) which I would again repeat and endorse: it is essential that the duty of candour laid upon any applicant for an order without notice is fully understood and complied with. It is not limited to an obligation not to misrepresent. It consists in a duty to consider what any other interested party would, if present, wish to adduce by way of fact, or to say in answer to the application, and to place that material before the judge. That duty applies to an applicant for a restraint order under POCA in exactly the same way as to any other applicant for an order without notice. Even in relatively small value cases, the potential of a restraint order to disrupt other commercial or personal dealings is considerable. The prosecutor may believe that the defendant is a criminal, and he may turn out to be right, but that has yet to be proved. An application for a restraint order is emphatically not a routine matter of form, with the expectation that it will routinely be granted. The fact that the initial application is likely to be forced into a busy list, with very limited time for the judge to deal with it, is a yet further reason for the obligation of disclosure to be taken very seriously. In effect the prosecutor seeking an ex parte order must put on his defence hat and ask himself what, if he were representing the defendant or a third party with a relevant interest, he would be saying to the judge, and, having answered that question, that is what he must tell the judge. I would qualify that only by saying that it is not acceptable that such an application should be forced into a busy list, with very limited time for the judge to deal with it, except in the comparatively rare case of a true emergency application where there is literally no opportunity for the prosecution to give the court sufficient notice for any other arrangement to be made. In that case, the judge will need to consider what is the minimum required in order to preserve the situation until such time as the court has had an adequate opportunity to consider the evidence. A material failure to observe the duty of candour as explained above may well be regarded as serious default within the meaning of section 72 of the Act because of its potential to cause serious harm. Before making an application order for a restraint order, with or without a receivership order, the prosecutor must consider carefully the statutory conditions for making such order. There must be reasonable cause to believe that the prospective defendant has benefited from criminal conduct (section 40(2)(b)) and there must be a good arguable case that the assets which it is sought to restrain must be realisable property held by him. Both conditions require careful thought about who is alleged to have been party to the criminal conduct under investigation. Careful thought must also be given to the potential adverse effect on others who are not alleged to be party to the criminal conduct and possible means of avoiding or limiting it. A judge to whom such an application is made must look at it carefully and with a critical eye. The power to impose restraint and receivership orders is an important weapon in the battle against crime but if used when the evidence on objective analysis is tenuous or speculative, it is capable of causing harm rather than preventing it. Where third parties are likely to be affected, even if the statutory conditions for making the order are satisfied, the court must still consider carefully the potential adverse consequences to them before deciding whether on balance the order should be made and, if so, on what conditions. A judge who is in doubt may always ask for further information and require it to be properly vouched. It is important to remember that under section 49(9) a receivership order may be made subject to such conditions and exceptions as the court specifies. The conditions attached to receivership orders appear to have become largely standard, but the making of a receivership order should never be a rubber stamping exercise. The court has a responsibility to consider what conditions it should contain. In In re Piggott [2010] EWCA Civ 285, para 54, Rix LJ referred to a suggestion made by Wilson LJ in the course of argument that in an appropriate case a management receivership order might be made subject to a special term that, if it should be shown in due course that the property subject to the order was not realisable property of the defendant but wholly in the legal and beneficial ownership of a third party, then the costs of the management receivership should be borne, not by the property, but, in the absence of any other source, by the prosecutor. I attach as an appendix to this judgment a possible form of Piggott condition, for which I am grateful to Lord Wilson. In my view there may indeed be cases in which such a condition would be appropriate, particularly cases in which the court can see the possibility that payment of the receivers expenses and remuneration out of the relevant assets might infringe a persons A1P1 rights. APPENDIX THE PIGOTT CONDITION Order made under s 49(2)(d) of POCA and Crim. PR 60.6(5) (1) Subject to the condition set out in (2) below, the receiver shall, in relation to any property to which the above receivership order is expressed to apply, have powers to realise so much of it as is necessary to meet his or her remuneration and expenses and to recover them out of the proceeds of its realisation. Order made under s 49(9) of POCA (2) The condition referred to in (1) above is that, in the event that it is hereafter determined, whether on appeal or by way of application for variation or discharge of this order, that any property to which the above receivership order is expressed to apply is not arguably held by the defendant and so should not have been made subject to the above receivership order, the powers in (1) above shall not extend to such property and, to the extent that in consequence the said powers do not enable the receiver to recover his remuneration and expenses in full or in part, the applicant for this order do pay him in respect of them. LORD HUGHES I agree that the receivers appeal against the decision of the Court of Appeal should be dismissed, and that he should not, in this case, be entitled to recover his expenses from the third party assets belonging to the companies. I also agree that the receivers appeal should succeed against the CPS. I gratefully adopt the reasons given in Lord Toulsons comprehensive judgment and add only a very few words on the topic of the application of A1P1 to the particular case of receivership orders made under section 48 of POCA as ancillary to a restraint order under section 41. As Lord Toulson explains, an order for the receiver to recover his expenses in the usual way from the assets which he is directed to administer cannot be disproportionate for the reasons held by the majority of the Court of Appeal. The mere fact that an order is set aside on appeal does not mean that it violates the principle of legality; if it did, there would be a breach of one or other of the qualified articles of the ECHR wherever they were engaged and there was a successful appeal. Nor, generally, will there be any question of a restraint or receivership order being disproportionate when made against the assets of a defendant (in which term POCA includes for this purpose an alleged offender under a criminal investigation: see section 40(9)), providing that there is reasonable cause to believe that he has benefited from criminal conduct. When it comes to assets which turn out to belong to a third party, the question whether an order for the receiver to recover his expenses from them is or is not disproportionate will depend on the circumstances. A restraint order under section 41, and thus a receivership order under section 48, must be made against realisable property. Such property is defined in section 83; it consists of free property held by the defendant, or by the recipient of a tainted gift. At the interim stage of an application for either form of order, the true ownership of assets may not be known, especially (but not only) where a defendant has taken steps to obscure the true position. So the test is that a good arguable case exists for believing that the defendant has an interest in them: Crown Prosecution Service v Compton [2002] EWCA Civ 1720. On the findings of the Court of Appeal in February 2011, which were not in question before this court, the present is a strong case of disproportion. There was simply never any proper basis advanced for the contention that the assets of these trading companies were the property of the controlling directors, who were the alleged offenders. The inclusion of the company assets in the restraint and receivership orders was based on nothing more than a bald request to lift the corporate veil. But no proper basis for doing so was advanced. It was not being contended that the companies were suspected of being parties to the crimes under investigation, in which event they would themselves have been alleged offenders and their assets might have been apt for restraint if there were grounds for believing that they had benefited from criminal conduct. The companies were, on the prosecutions own case, businesses with substantial legitimate trading, so there could be no suggestion that they were sham entities concealing true ownership of their apparent assets by the suspected directors. It does not seem to have been suggested that the companies were used to evade the legal responsibility of the directors for any crimes suspected. Nor, on the findings of the Court of Appeal, was there any arguable case that they were being used by the directors to channel the benefits of crime to themselves. Other cases of assets which turn out to belong to third parties must be decided on their own facts. If the original order was made when there was indeed a good arguable case for believing that the defendant under investigation had an interest in them, then the fact that it later turns out that he had none will not normally mean that the usual route for a receiver to recover his expenses is disproportionate to the legitimate aim of confiscation legislation to preserve assets which may be needed to satisfy a confiscation order if conviction ensues. If an order was thus made, it does not seem likely that its subsequent setting aside on grounds such as that ownership turns out to be other than it appeared, or that the expense of receivership is not, on closer inspection, justified, would lead to a finding of disproportion. Underhill Js remarks about the closeness of the connection between the defendant and the third party are, on proper analysis, not independent tests of when an order can be made, but reflect a factor which may well be highly relevant to whether there is a good arguable case for believing that the assets are ones in which the defendant has an interest. I respectfully endorse Lord Toulsons remarks at para 122. Restraint (and occasionally receivership) orders may be very valuable in promoting the aims of POCA, which may otherwise all too easily be evaded by alleged offenders once they know that they are under investigation. But such orders are also capable of causing considerable loss to the holders of assets. Applicant prosecutors, and judges asked to make such orders, need to think constructively and critically about what is being alleged and who is said to be a party to it, and also about the balance between the benefits and the costs of the orders sought.

On 6 December 2010 the Crown Prosecution Service applied to the Crown Court for restraint orders under section 41 of the Proceeds of Crime Act 2002 (POCA) against two individuals, and restraint and receivership orders (under section 48 POCA) against Eastenders Group. Eastenders Group, of which the individuals were the joint owners, was a holding company for a number of trading cash and carry retail outlets. These orders were sought because the CPS was conducting a covert investigation into a suspected fraud on HMRC, allegedly carried out through Eastenders Group companies. A POCA restraint order prevents named persons from dealing with their own assets until the order is discharged. A receivership order appoints a receiver to manage the assets of the company subject to the restraint order. The CPS sought to have Mr Barnes, a partner in a well known firm of accountants, appointed as Eastenders Groups receiver under a letter of agreement between the CPS and Mr Barnes. The letter of agreement suggested that Mr Barnes would be remunerated from Eastenders Group property. The restraint and receivership orders were made by the Crown Court judge after a short hearing. Mr Barnes was appointed and began to manage the Group. On 23 December 2010, the Eastenders Group sought to have its orders discharged, but the judge refused. The Group appealed to the Court of Appeal, heard on 25 January 2011. On 26 January 2011 the Court of Appeal quashed the orders over the Group. They held that the orders should never have been made: there was no good arguable case that the Group assets should be regarded as the individuals assets, and 95% of the business of the Group was demonstrably legitimate. However, during the period of the receivership, the receiver had incurred costs and expenses of 772,547. This included significant sums for site security, legal expenses and the receivers fees. The receiver applied to the Crown Court for permission to draw his remuneration and expenses from Eastenders Group assets. The application was refused by Underhill J, who held that requiring the companies to pay would breach the Groups right to peaceful enjoyment of its possessions under Article 1 of Protocol 1 to the European Convention on Human Rights (A1P1), and so would be unlawful under section 6 Human Rights Act 1998 (section 3 HRA 1998). He went on to hold that it was possible to interpret POCA (by section 3 HRA 1998) to give the court the power to require the CPS to pay the receivers remuneration and expenses. The CPS appealed to the Court of Appeal. The majority of the Court of Appeal upheld Underhill Js decision that the Groups rights under A1P1 would be infringed by an order entitling the receiver to draw his remuneration from its assets on the basis that the order was insufficiently foreseeable. Laws LJ, dissenting on that point, would have allowed the receiver to draw his remuneration from Eastenders assets. The Court was unanimous that there was no basis under POCA or the HRA 1998 for the CPS to be required to pay the receivers remuneration and expenses. The receiver appealed to the Supreme Court. The Supreme Court unanimously allows the receivers appeal (only) against the Court of Appeals refusal to have the CPS to pay the receivers remuneration and expenses. Lord Toulson gives the leading judgment, with a short concurrence by Lord Hughes dealing with the practical application of the courts decision. It is a general principle of the law of receivership that a court appointed receiver is entitled to remuneration from the assets of the administered company. That law is clear and foreseeable. However, where the administered company is not itself a defendant, nor at the time of the order was there any reasonable cause to regard its assets as the defendants, it would be a disproportionate interference with the companys A1P1 rights for the receivers remuneration to be drawn from the companys assets. However, to leave the receiver without a remedy would be to substitute one injustice for another and violate the receivers A1P1 rights. In this case the receiver and the CPS acted on a common assumption, fundamental to the agreement, that the receiver would be able to claim his remuneration and expenses from the Eastenders Group. That assumption failed: the receiver accordingly has a valid right to restitution from the CPS. It is an established principle of the common law of receivership that a court appointed receiver may draw his remuneration and expenses to the assets placed by the court in his/her control. The receiver has a lien over those assets for that purpose [44]. That common law, together with the provisions of POCA and the Criminal Procedure Rules, provide amply clear and foreseeable authority for the making of such order, and Laws LJ was correct so to hold [83]. The critical question in this case is not foreseeability, but proportionality. Would it be disproportionate to order that the Receivers expenses be drawn from the companies? [87]. The taking of property without compensation is, in general, a disproportionate interference with A1P1 [88]. In this case the Group were neither defendants nor (as the Court of Appeal found) was there any reasonable cause for regarding the Group assets as those of the defendants at the time when it was made [89], [125 130]. Divesting the Group of its assets in that situation is disproportionate [94]. It is as if the assets of an innocent defendant were sought to be used to cover the costs of detaining and prosecuting him or her [92]. The Receivers application to recover his expenses from Eastenders Group therefore fails [96]. However, that conclusion would leave the court in an invidious position, since to leave the Receiver without recompense would violate his A1P1 rights [96]. The Receiver had, however, entered on his receivership pursuant to a letter of agreement with the CPS [98]. It was the mutual expectation of both the Receiver and the CPS that the Receiver would have a legally enforceable lien over the receivership property [99]. Unjust enrichment may cover a variety of situations. Failure of services at the request of another is capable of being regarded as enrichment, and it would be unjust if the receiver were not paid for the services which he provided [100 117]. Hence the receiver has a claim in unjust enrichment against the CPS [117]. The restraint and receivership orders were made in this case on an application at short notice. Applications by the CPS for such orders should be made as early as possible, with proper time estimates and reading lists, enabling the court to consider the necessary arrangements [118 119]. The fact that such applications are made ex parte places a special burden of candour on the CPS and considerable responsibility upon the court [120]. Failure to discharge the duty of candour could well be considered serious misconduct [121]. The court should always consider such applications carefully: making such orders should never be a rubber stamping exercise. In certain cases, it could be appropriate to attach a Piggott condition to a receivership order providing that if property was shown not to be realisable property, the receivers costs should fall on the CPS [124].

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This appeal concerns the application of the test of obviousness under section 3 of the Patents Act 1977 to a dosage patent. In summary, a patent, whose validity is not challenged, identified a compound as an efficacious treatment but did not identify an optimal dosage regime. A pharmaceutical company, which had acquired the patent, conducted extensive research into ascertaining the optimal dosage of the compound. It discovered a dose which not only was safe and effective but also, unexpectedly, could be administered in a new and beneficial manner, because of both the half life of the compound and its minimal side effects at that dose. A number of generic drug manufacturers challenge the validity of the dosage patent on the basis that it involves no inventive step. The appeal raises two principal questions. The first relates to the application of the obviousness test to a dosage patent and the second is concerned with whether the Court of Appeal was entitled to reverse the judgment of the judge at first instance on that question in the circumstances of this case. The patent under challenge The dosage patent which is the subject of this appeal is EP(UK) 1,173,181 (the 181 patent). It is owned by ICOS and exclusively licensed to Eli Lilly (collectively Lilly). It relates to the use of tadalafil in a dosage form for the treatment of sexual dysfunction. It was filed on 26 April 2000 and claims priority from US application no 60/132036P filed on 30 April 1999. It was granted on 15 October 2003. The form of the 181 patent is a B3 specification following centralised amendments made in the European Patent Office (EPO) on 25 March 2015. The claimants, who are the respondents in this appeal, raised proceedings to revoke the 181 patent and Lilly defended the claim and counterclaimed that the claimants were threatening to infringe its patent. The earlier phases of this litigation involved challenges to the 181 patent based on (a) priority, (b) added matter, (c) lack of novelty, (d) obviousness and (e) insufficiency. Of those challenges, the principal matter of contention is obviousness. The claimants challenges on priority, added matter and lack of novelty arise only if this court upholds the appeal by Lilly against the Court of Appeals finding of obviousness. Factual background Erectile dysfunction (ED) is a common medical condition which affects approximately 50% of the male population between the ages of 40 and 70. It is caused by a number of disorders, both physiological and psychological. Unsurprisingly, the discovery of a drug to treat ED, called sildenafil, which was and is sold under the brand name VIAGRA, proved to be a very great commercial success. The drug, which is the subject of the patent in dispute, is called tadalafil. Tadalafil is the generic name for a drug which is sold under the brand name CIALIS for the treatment of ED and benign prostatic hyperplasia, and under the brand name ADCIRCA for the treatment of pulmonary arterial hypertension. CIALIS has also enjoyed great commercial success. In 2014 worldwide sales amounted to about $2.29 billion and UK sales amounted to about $99m. In that year UK sales of ADCIRCA amounted to about $1m. Technical background I derive my summary of the technical background from the judgment of Kitchin LJ, who wrote the leading judgment in the Court of Appeal [2017] EWCA Civ 1671; [2018] RPC 7, and the findings of the trial judge, Birss J [2016] EWHC 1955 (Pat). The penis contains smooth muscle. When in its normal resting state, the smooth muscle contracts and so restricts the arteries supplying blood to the penis. When an erection is triggered, the smooth muscle relaxes and no longer restricts the supply of arterial blood, causing the penis to become tumescent. The smooth muscle relaxation which leads to the erection results from a cascade of complex biochemical reactions within the body. Sexual stimulation causes the release of the neurotransmitter nitric oxide (NO) which enters the smooth muscle cells where it leads to an increase in the production of a second molecule, cyclic guanosine 3, 5 monophosphate (cGMP). cGMP in turn binds to and activates an enzyme which regulates the activity of other intracellular proteins and leads to the relaxation of the smooth muscle. An increase in the intracellular level of cGMP, through NO production, therefore promotes smooth muscle relaxation, while a decrease in the intracellular level of cGMP tends to cause the smooth muscle to return to its ordinary contracted state. The intracellular concentrations of cGMP and another second molecule, cyclic adenosine 3,5 monophosphate (cAMP), are regulated by a class of enzymes known as cyclic nucleotide phosphodiesterases (PDEs). By the priority date in 1999 at least six PDE families had been identified. It was known that the PDE family most prevalent in the penis was PDE5. This binds cGMP and hydrolyses it to its non cyclic form GMP, so leading to a reduction in smooth muscle relaxation and the prevention of penile tumescence. It is necessary to mention also the concept of potency. Potency is the amount of the drug required to produce a defined biological effect of given intensity. Potency can be measured as the concentration or dose of a drug required to produce 50% of the drugs maximal effect (EC50 or ED50) as depicted by a graded dose response curve. In the context of a drug that inhibits the action of another substance, potency can be expressed as the concentration of a drug required to inhibit a given biological process by half, ie the in vitro concentration of the drug which is required for 50% inhibition (IC50). A higher potency drug will have a lower concentration because less drug will be required to achieve the same effect. As Kitchin LJ illustrated in paras 17 and 18 of his judgment the dose response curve of a drug is illustrated graphically as a sigmoid (or S shaped) curve with a flat or gently inclined base at which increasing doses are slow to manifest a significant effect, a steep central part at which increasing doses have an increasing effect, and a plateau at the top at which increasing doses have no increased effect. The minimum effective dose is the smallest dose in the dose response curve at which a clinically relevant effect can be seen. The concept of the minimum effective dose would be known to the skilled team, who would be aware that regulators could ask for it to be identified. But they would also know that it is not always required. The trial judge found that it had not been established that the skilled team would always seek to identify the minimum effective dose for a given drug. It might be sufficient to know that the minimum effective dose was somewhere in a range. In the context of ED, there was no agreed definition of a minimum clinically relevant effect and this had a bearing on the judges reasoning in relation to obviousness. Identification of the minimum effective dose depends on a value judgment, as the skilled team would know. The primary task of the skilled team was and is to make safe, tolerable and effective medicines. Sildenafil and tadalafil Sildenafil was marketed as an orally administered PDE5 inhibitor, which prevented PDE5 from hydrolysing cGMP to the inactive GMP. cGMP levels remain elevated as a result and this promotes smooth muscle relaxation. This leads to greater arterial blood flow into the penis when it is stimulated and results in penile tumescence. A disadvantage of sildenafil was its effect on other PDE families and, in particular, PDE6 which was associated with known visual side effects. Sildenafil was also associated with normally mild and transient side effects including flushing, headache and dyspepsia, which were thought to be related to its mode of action as a PDE5 inhibitor. Sildenafil was known to be administered on demand with an onset of action of about one hour and a half life of about four hours. It was marketed at doses of 25mg, 50mg and 100mg. It was known that broadly efficacy increased with dose and so did side effects. Those were the doses upon which a skilled team would focus although it was also known that a 10mg dose of sildenafil had been investigated in trials and shown to be efficacious. Sildenafil was a first in class drug which validated the rationale for trying to treat ED using an oral PDE5 inhibitor. Any other PDE5 inhibitor for ED would be known as a second in class drug. A clinical pharmacologist would have an enhanced expectation that a second in class drug would be efficacious. But the idea of investigating chronic dosing of a drug for ED was not part of the common general knowledge. Tadalafil is a second in class drug. It is another PDE5 inhibitor and operates in essentially the same way as sildenafil. An advantage which tadalafil was found to have over sildenafil was its selectivity; it was able to bind to and inhibit its target PDE5 while having significantly less effect than sildenafil on other PDE families and, in particular, PDE6. This selectivity resulted in less and a smaller number of side effects. The skilled team The parties agreed that the notional skilled team, by reference to which the question of the obviousness of the patent in dispute would be assessed, would include a clinical pharmacologist with experience in pharmacokinetics and a clinician specialising in urology. Both were important and would work together. The clinical pharmacologist would take the lead in the quantification of doses and the dose response. The clinician would take the lead when assessing the clinical significance of an effect, whether a desired effect or a side effect. The clinical pharmacologist would be primarily responsible for selecting the doses to be tried in the dose ranging study, with input from the clinician. The phases of clinical research It was of central importance to the case of obviousness which the claimants presented that clinical research into a new medicine follows a standard pathway of four phases. The judge set out this pathway in paras 76 81 of his judgment and below I draw heavily on Kitchin LJs summary of that exposition. A new drug, identified through appropriate in vitro testing and pre clinical animal studies, is taken forward into human tests. The first of such tests are known as Phase I and they are carried out on healthy volunteers to test safety rather than efficacy. The tests provide pharmacokinetic information and allow an assessment of bio availability. If these tests are positive, the next step is to move the drug into Phase II. Phase II studies are generally carried out in two stages, Phase IIa and Phase IIb. Phase IIa, which consists of what are sometimes known as go, no go studies, provides proof of concept. The studies are generally carried out at one dose, selected to be high enough to give the drug the best chance of showing a positive effect on the disease, albeit not too high to risk serious side effects. Phase IIb involves testing a range of doses to show the effect of the dose. In the judges words, the idea is that the highest dose will show a larger clinical effect than the smallest dose. The obviousness challenge in this case focuses on what the hypothetical skilled team would do in this phase of clinical research. If the decision after Phase II is positive, the next phase is Phase III. This is a large scale clinical trial designed to generate data to support an application for regulatory approval. Phase IV studies take place after regulatory approval and are not relevant to the issues arising in this appeal. The Daugan patent Glaxo filed an application for a patent which was published on 6 February 1997 and led to patent EP 0 839 040 (the Daugan patent or Daugan). Glaxo did not take forward the research to implement the Daugan patent but transferred it to ICOS. The Daugan patent discloses the idea of using certain compounds which are PDE5 inhibitors for the treatment of ED. It specifically describes two compounds, A and B. Compound A is tadalafil. Daugan discloses tadalafils (and Compound Bs) potency (ie IC50) against PDE5 as 2 nM. Daugan discloses that doses of Compounds A and B will generally be in the range of 0.5mg to 800mg daily for the average adult patient. It gives examples of a tablet containing a 50mg dose of the active ingredient. But the Daugan patent does not purport to set out an appropriate dosage regime as an oral treatment of ED. It is not disputed that at the priority date it was entirely obvious for the notional skilled team, given the Daugan patent, to set out taking tadalafil forward into a routine pre clinical and clinical trial programme as an oral treatment for ED. The statements in Daugan and the huge success of sildenafil as an oral PDE5 inhibitor made it very obvious. Tadalafil would be an attractive potential second in class medicine to develop because Daugan teaches that it has a promising IC50 against PDE5. It is more potent than sildenafil, which has an IC50 of about 3 or 3.9 nM. The trial judge found that the skilled team would understand the limitations of in vitro IC50 data and would know that there could be all sorts of factors such as bioavailability and tissue compartmentalisation which might limit tadalafils clinical utility. But he found that that would not deter the skilled team from embarking on a routine pre clinical and clinical trial programme. The central question in this appeal is whether in the light of the common general knowledge which I have summarised in paras 8 16 and 18 22 above and the Daugan patent as the nearest prior art, the relevant claims in the 181 patent were obvious. I therefore turn to the 181 patent. The 181 patent The 181 patent is a dosage patent. In the specification (para 1) it refers for priority to the provisional patent application to the US Patent and Trademark Office Serial no 60/132036, which was filed on 30 April 1999. It asserts (para 2) that the invention relates to a highly selective PDE enzyme inhibitor and to its use in a pharmaceutical unit dosage form. In particular it relates to a potent inhibitor of PDE5 that is useful for the treatment of sexual dysfunction. In its description of the background of the invention, it refers to VIAGRA, its lack of selectivity for PDE6 and its side effects (para 4). It refers in para 7 to the Daugan patent and its disclosures. It asserts (para 8) that the applicants have discovered that tadalafil (which it described as compound (I)) can be administered in a unit dose that provides an effective treatment without the side effects associated with the presently marketed PDE5 inhibitor, sildenafil. Prior to the present invention such side effects were considered inherent to the inhibition of PDE5. It continues (para 9) that clinical studies revealed that the product is effective with a reduced tendency to cause flushing and, unexpectedly, can be administered with clinically insignificant side effects associated with the combined effects of a PDE5 inhibitor and an organic nitrate. In its summary of the invention (paras 11 15) it discloses a pharmaceutical dosage form for human pharmaceutical use of about 1 to about 5mg of tadalafil in a unit dosage form suitable for oral administration for the treatment of sexual dysfunction, including ED up to a maximum total dose of 5mg per day. The relevant claims are as follows. Claim 1 asserts A pharmaceutical unit dosage composition comprising 1 to 5mg of a compound having [the illustrated structural formula of tadalafil] said unit dosage form suitable for oral administration up to a maximum total dose of 5mg per day. Claims 2 and 3 assert dosage forms comprising 2.5mg and 5mg of the compound respectively. Claim 6 states: the dosage form of any one of claims 1 through 3 for use in treating a condition where inhibition of PDE5 is desirable. Claim 7 refers to the dosage form of claim 6 wherein the condition is a sexual dysfunction. It is a claim for a purpose limited product, known as an EPC 2000 claim, which, since 2011, the European Patent Office (EPO) issues in place of Swiss form claims, and claim 8 refers to the sexual dysfunction of ED. Claim 10 is a Swiss form claim which, as is well known, is a purpose limited process claim, giving a monopoly for the use of compound X in the manufacture of a medicament for the treatment of indication Y. It is in the following terms: 10. Use of a unit dose containing 1 to 5mg of a compound having the structure [of tadalafil] for the manufacture of a medicament for administration up to a maximum total dose of 5mg of said compound per day in a method of treating sexual dysfunction in a patient in need thereof. Kitchin LJ in his judgment (para 46) observed that the purpose limited claim 7 is dependent on claim 6 and claim 1 and construed it as manifesting an intention that the maximum dose per day constituted part of the purpose limitation of the claim. He also interpreted claims 7 and 10 as being directed to the treatment of sexual dysfunction by the administration of a dose of no more than 5mg tadalafil per day. The claimed invention is the application of the discovery that sexual dysfunction may be treated by administering such a dose and with minimal side effects (paras 50 52). The claimants do not challenge those findings. Lilly asserts that the essence of the invention is the discovery that tadalafil is effective in treating ED at such a low dose and with minimal side effects. This discovery has allowed the drug to be taken daily (for chronic use) rather than on demand, thus avoiding the need to anticipate when sexual activity might occur. This is, Lilly claims, a significant technical advantage as sildenafil by contrast is approved for on demand use only. Obviousness: the claimants challenge and Lillys answer Before Birss J the claimants submitted that it would be obvious for a skilled team given the Daugan patent to take tadalafil forward into a routine pre clinical and clinical trial programme as an oral treatment for ED at the priority date. While costly and time consuming, the programme would involve nothing other than routine work and no inventive effort was required. In the course of the programme to establish tadalafil as a safe, tolerable and effective treatment for ED, a 5mg dose would be one of the doses used on patients as it was obvious to ascertain the lowest dose at which the drug was effective. Standard dose ranging studies would lead to the claims in the 181 patent. The programme would reveal the invention without any inventive step. The fact that the 5mg per day dosage has a surprising beneficial property of minimal side effects was simply a bonus which did not make the dosage regime an invention. Lillys response was first that the discovery of the dosage regime was the result of expensive and unpredictable research which was entitled to patent protection. Secondly, at the start of the programme it was not obvious to try a low dose like 5mg per day as there was no reason to think that it would be effective at that dosage. To invalidate the claim, it would be necessary to show that at the start of the programme it was obvious to the skilled team that a 5mg/day dose would be safe and effective and also would have the minimal PDE5 related side effects. Lilly referred to the EPOs problem and solution approach and sought to apply it to the facts of the case. Birss J accepted neither approach in its entirety. He analysed the obviousness case by concentrating on claim 7. He reminded himself that the test for obviousness is a single and relatively simple question of fact. It is a question of fact to be decided by detailed technical arguments and evidence concerning the particular facts and circumstances, a task with which wide generalisations do not assist. He accepted that some experiments which were undertaken without a particular expectation as to the result were obvious. When considering pre clinical and clinical research it may be necessary to consider a step wise series of tests which the skilled team would undertake. But even if each of those steps were obvious, one must avoid the risk of hindsight by standing back and looking at the facts as a whole. The fact that routine tests have uncertain results does not on its own turn those results into an invention. Similarly, the fact that, before the pre clinical, Phase I and Phase IIa tests had been performed, one cannot say what particular doses will be tested in a Phase IIb test does not of itself make those doses inventive if some of them are found to work. He referred to the statement by Kitchin J in Generics (UK) Ltd v H Lundbeck A/S [2007] RPC 32, which I set out in para 63 below, and identified as relevant factors in his assessment of obviousness in this case the following: motive, multiple avenues, the effort involved and the expectation of success, the occurrence of unexpected and surprising results and the need for and nature of value judgments which have to be made in carrying out the project. The judges findings of fact were based principally on the evidence of (i) Mr Gary Muirhead a consultant to the pharmaceutical industry, whom the claimants called and who had worked for Pfizer on the development of drugs, including sildenafil, (ii) Dr Jay Saoud, whom Lilly called and who had over 25 years of experience in clinical development, pharmacokinetics and statistical analysis in industry, academia and contract research organisations and (iii) Dr Gerald Brock, whom Lilly called and who is a practising clinical urologist with extensive clinical, academic and advisory experience in matters concerning treatments for ED. In his careful assessment of their evidence Birss J held, at paras 287 et seq, that it would have been entirely obvious for a skilled team given Daugan to set out to take tadalafil forward into a routine pre clinical and clinical trial programme as an oral treatment for ED at the priority date. The Phase I studies would produce results which would lead the skilled team to design and undertake the Phase IIa go no go study of a single 50mg dose of tadalafil in a relatively small group of patients. They would embark on that study with a reasonable expectation that the drug would be safe, tolerable and effective at that dose. Turning to the Phase IIb studies, Birss J concluded that the first dose ranging study would be of on demand dosing using 25, 50 and 100mg of the drug. He did not accept Mr Muirheads suggestion that a 5mg dose would be included in this first study. The skilled teams expectations would be that they would hope that the study would show a dose response relationship. But the results would not be what the team expected because they would show no difference in efficacy between the three doses, demonstrating an apparent therapeutic plateau. The critical dispute at this stage was whether in the light of those findings it was an obvious thing for the skilled team to conduct a further dose ranging study or studies to investigate lower doses and determine the minimum effective dose. Birss J did not accept the claimants case that it was. He held that the skilled team would be well aware that there was no defined standard of minimal efficacy in relation to ED and that it would require a value judgement to characterise a minimum effective dose. He concluded (para 327) that it was not inevitable that the skilled team would investigate lower doses after discovering the therapeutic plateau because they had found a dose (at least 25mg) which was safe, tolerable and effective and thus had secured the prime objective of the programme; but he held that it was very likely that they would. A skilled team would be familiar with multiple dose ranging studies as necessary as a generality. If the skilled team carried out a further dose ranging study they would have included 5mg and 10mg doses. They would not have any expectation that the minimum effective dose was substantially lower than 25mg or that they would find a dose below 25mg at which there was a clinically relevant effect with reduced side effects. The discovery that at a 5mg dose tadalafil was efficacious and had reduced side effects would surprise the team. The investigation of chronic daily dosing in addition to on demand dosing would follow the similar pattern but the initial study would probably include a 10mg dose. The teams expectation would be the same. Having conducted this step by step analysis, Birss J then looked at the programme as a whole and assessed obviousness overall. He concluded that, given Daugan, a 25mg/day dose of tadalafil was obvious as a treatment for ED but that a 5mg daily dose was not. In para 343 he summarised his reasons in these terms: i) In terms of motives to find a solution to the problem the patent addresses, the skilled team would be highly motivated by Daugan and the success of sildenafil to investigate tadalafil as a treatment for [ED]. ii) As for possible avenues of research, overall tadalafil would be obvious to investigate. In terms of doses however, 5mg/day is a significantly lower dose than the 50mg dose exemplified in the Daugan prior art and the marketed doses of sildenafil. It is also significantly lower than the 50mg dose which would be chosen for the first test of efficacy at Phase IIa. It would not be chosen in the routine first dose ranging study. The team would not have anticipated daily dosing as something to be studied from the outset but once the half life was discovered it is likely that daily dosing would be included. In terms of effort, overall the programme would involve iii) very substantial resources of time, money and people but it would be pursued. However, by the time the idea of investigating lower doses presents itself, the team would have established safe, tolerable and effective doses of tadalafil at 25mg on demand and 10mg for daily dosing. At that stage the impetus to investigate lower doses would be reduced but not eliminated. iv) Expectations of success can be considered overall and in relation to particular studies. Overall the team would embark on the project with a reasonable expectation of success in establishing tadalafil as a safe, tolerable and effective treatment for [ED]. However, the claimants failed to prove that efficacy at 5mg tadalafil was predictable or worth considering by the skilled team based on the properties of tadalafil as compared to sildenafil. The team would know that in principle there would be a minimum effective dose for tadalafil but would also know that its definition depends on a value judgment made by the team. In relation to the dose ranging studies, the team would conduct them hoping for a dose response. Following discovery of a plateau starting at 25mg or 10mg, there would very likely be a subsequent dose ranging study which included 5mg. The team would include a 5mg dose in this study hoping to see a dose response but that does not mean they would have a reasonable expectation that 5mg would produce a clinically relevant effect at all nor one with minimal side effects. Assuming a 5mg/day dose of tadalafil was tested, it would not be tested with a reasonable expectation of success. v) Considering unexpected or surprising results, the position is as follows. The path to a 5mg dose requires the discovery of new information such as the half life and the IC50 vs PDE6. That information would inevitably be found in any clinical programme. The path includes an important result which is unexpected even if it is not actually surprising, ie the plateau in the dose response from 10 to 100mg. There is also a surprising result: the existence of a useful effect with reduced side effects. The claimed 5mg/day dose has that property. vi) A number of value judgments would be required of a skilled team in a programme which reaches the claimed invention. One is to define the level of clinical effect to be regarded as relevant. Another is to embark on investigating daily dosing. An important value judgment is what to do when an unexpected plateau in the dose response has been identified as the same time as a marketable dose. He therefore concluded that claim 7 of the 181 patent involves an inventive step. The Court of Appeal reached a contrary conclusion and allowed the appeal on the ground that claims 1, 7 and 10 were invalid for lack of inventive step. In the leading judgment, Kitchin LJ addressed the claimants case that, in the light of Daugan, it was obvious to take tadalafil forward into routine pre clinical and clinical trial programme to assess its use as an oral treatment for sexual dysfunction. The claimants argued that nearly all dosage regimes in a Swiss form claim will be obvious: Actavis UK Ltd v Merck & Co Inc [2008] EWCA Civ 444; [2009] 1 WLR 1186, Jacob LJ at para 32. A 5mg daily dose would be used in patients in the course of that programme and would reveal that it was a safe, tolerable and effective treatment. In other words, it would reveal the invention. The alleged invention was merely the product of standard practice in a routine clinical trials process and the purpose of Phase IIb studies was to provide an understanding of the dose response relationship. Lillys answer was that at the start of the programme it was not obvious to try a 5mg dose because the skilled team would have no idea if it would be a safe, tolerable and effective treatment. The skilled team had to make a series of value judgements in order to arrive at the invention and would have had no expectation that the 5mg dose would be efficacious or that it would have reduced side effects. Kitchin LJ stated, at paras 131 135, that it was not the law that investigations into appropriate dosage regimes cannot yield patentable inventions and that Jacob LJ had not suggested otherwise in Actavis v Merck. The statutory task of the court was to have regard to all the relevant circumstances in order to answer the single question: was it obvious to the skilled but unimaginative addressee in light of the prior art and the common general knowledge to make a product or carry out a process falling within the claim? He affirmed that the judge would have had this well in mind. Accordingly, where no question of principle was involved, an appellate court had to be very cautious in differing from a judges evaluation. Nonetheless, he held that claim 1 was invalid for obviousness. It had no purpose limitation and encompassed a unit dosage composition comprising 1mg to 5mg of tadalafil which was suitable for administration up to a maximum total dose of 5mg per day but which was intended and was in fact used for administration of a higher per day total dose. On the judges findings, given Daugan, it was obvious to develop such a composition and the judge should have so found. I do not understand Lilly to challenge this finding in this appeal. Instead, the battleground relates to claims 7 and 10. In relation to those claims, the debate in the Court of Appeal appears to have focussed on the notional skilled teams approach to the Phase II trial. Kitchin LJ recorded Lillys case that, having carried out the initial Phase IIb study, which would have found the 25mg dose on demand to be safe and efficacious, the skilled team needed to go no further but if they chose to do so, would test a 10mg dose before deciding whether to go further and test a 5mg dose. The skilled team also had to decide whether to test daily dosing. There were therefore various possible avenues of research, involving value judgements and it was not inevitable that the skilled team would investigate lower doses. Kitchin LJ accepted that it was relevant to consider whether the skilled team, starting with Daugan, would be faced with various possible avenues of research. He recognized that the skilled team would be faced with choices when embarking on Phase II studies, including how to proceed with the dose ranging studies and whether to study on demand or daily dosing. But in relation to the latter decision, he pointed out that the judge had found that the Phase I trial would have revealed the half life of tadalafil and that the team would have decided to pursue both on demand and daily dosing in Phase II. In relation to the former decision, Kitchin LJ pointed out that the judge had found that the team would very likely investigate the 5mg dose of tadalafil after the first or, in the case of on demand dosing, a possible second dose ranging study. This finding was supported by the purpose of dose ranging studies, which was to ascertain the dose response relationship of the drug, and the fact that, so long as the study showed the IC50 remaining on the upper therapeutic plateau, that dose response relationship had not been found. Further, it was consistent with the evidence of the expert clinical pharmacologists, Mr Muirhead and Dr Saoud, and Kitchin LJ quoted the latters evidence on cross examination that, having discovered the therapeutic plateau, it was a no brainer to test a lower dose and that the skilled team would have done so. Kitchin LJ therefore rejected the idea that the skilled team would have been faced with a series of parallel avenues of studies and would have no expectation that any one of them would prove fruitful. Further, the team would have addressed both on demand and daily dosing and each avenue of inquiry would be very likely to lead the team to the invention. Kitchin LJ held that the judge should not have attached weight to the fact that a 5mg dose was considerably less than the 50mg dose which would have been used in Phase IIa, because the Phase IIb tests were carried out for a different purpose, that is to ascertain the dose response relationship. Nor should the judge have attached weight to the conclusion that a 5mg dose would not be tested in the first Phase IIb study because he had also found that the team would very likely investigate it afterwards: the impetus to investigate lower doses would have remained because the purpose of the Phase IIb study had not been fulfilled. The finding that the skilled team could not predict at the outset that a 5mg dose would be safe and efficacious was of little weight because at least one of the purposes of the Phase IIb studies is to understand better the dose response relationship of the drug and so identify the appropriate dose for the target population. Similarly the judge was wrong to attach weight to the conclusion that the team would not have an expectation of success when testing the 5mg dose: the judge had held that the team were very likely to test the 5mg dose as part of the dose ranging study but it was hard to see why they would have done so unless they had a reasonable expectation that it would assist them better to understand the dose response relationship. Kitchin LJ also held that little weight could be attached to the fact that it was surprising (a) that there was a therapeutic plateau from 10mg to 100mg, and (b) that a 5mg per day dose was efficacious and had reduced side effects. While the discovery of a surprising or unexpected technical effect may be suggestive of invention, in this case the discovery of the therapeutic plateau and the efficacy of the 5mg dose was the product of a routine trial programme and the unexpected reduced side effects of the 5mg dose was a bonus effect which did not cause the 5mg dose to cease to be obvious. He also concluded that the value judgments to which the judge referred in para 343(vi) of his judgment (para 38 above) provided no effective support for the judges conclusion in the face of his critical finding that it was very likely that the team would test the 5mg dose. Kitchin LJ summarised his conclusions in this way, at para 152: Drawing the threads together, I am satisfied that Mr Speck has made good his criticisms of the judges reasoning. The judge has lost sight of the fact that, on his own findings, the claimed invention lies at the end of the familiar path through the routine pre clinical and clinical trials process. The skilled but non inventive team would embark on that process with a reasonable expectation of success and in the course of it they would carry out Phase IIb dose ranging studies with the aim of finding out, among other things, the dose response relationship. It is very likely that in so doing they would test a dose of 5mg tadalafil per day and, if they did so, they would find that it is safe and efficacious. At that point they would have arrived at the claimed invention. In my judgment claims 7 and 10 are therefore invalid. Floyd and Lewison LJJ issued concurring judgments to which I will refer in the discussion below. Mr Waughs challenge to the judgment of the Court of Appeal can be boiled down to one central submission: the statutory question in section 3 of the 1977 Act is whether the claimed invention was obvious at the priority date. This straightforward approach to the assessment of obviousness, he submitted, required the court to look at the invention set out in the relevant claim or claims of the patent and ask itself whether that asserted invention was obvious to the notional skilled but uninventive team at the priority date having regard to the state of the art at that date. Therefore, the question which the Court of Appeal should have asked was whether at the priority date, before the skilled team embarked on its investigation, it was obvious in the light of Daugan, and without knowledge of the alleged invention, that a 5mg per day dose of tadalafil would be a safe and effective treatment, with minimal side effects, for sexual dysfunction. The Court of Appeal erred by not adopting that approach and instead by holding that the invention was obvious, because the claimed invention was the product of a familiar and routine path of pre clinical and clinical research, in which each step was likely to follow the outcome of the prior step. This erroneous approach failed to address the question whether it was obvious to try that low dose because there was a reasonable expectation of success at the outset. It was also in conflict with the approach of the EPO which adopted a problem and solution analysis. Costly and time consuming research which led to an unexpected technical effect will be patentable, whether such work is routine or not. The Court of Appeal, which accepted the trial judges findings of fact, was not entitled to overrule his analysis. Mr Speck sought to answer this case by making seven propositions. They were, first, that patent law is concerned with technical information which is of use industrially. A technical contribution is the difference between what a skilled person is enabled to do (a) in light of the state of the art and (b) with the teaching of the patent. Secondly, there was a symmetry or balance in the patent system which required an enabling disclosure, in other words a technical contribution, as the basis of a patent. Thirdly, the fundamental principle underlying the grant of a monopoly through a patent is that the monopoly must be commensurate with that technical contribution. The monopoly cannot cover that which the skilled person is already able to do or make, including obvious modifications or additions to the state of the article Those he described as the skilled persons repertoire. Fourthly, if all that a skilled person discovers is more information about products or processes that are already within that notional persons repertoire, there is no basis for the grant of a patent because that information does not add to the products or processes which the skilled person can make or do. Fifthly, the principle advanced by Lilly, that it is not permissible to take into account information not known at the priority date, is contrary to the basic scheme of patent law. Sixthly, if that principle were correct, it would apply whether or not the research revealed an unexpected benefit. Seventhly, patent law excludes from consideration information which is routinely ascertained using routine methods as part of the state of the art and using them for a routine purpose towards a routine end: in this case the implementation of the Daugan patent. Discussion i) I am not persuaded that the law adopts the extreme position of either submission. Lillys approach would require the court to disregard the work which a skilled person would carry out after the priority date in order to implement the teaching of the Daugan patent. That approach, as Mr Speck submitted, is contrary to the basic scheme of patent law. Actaviss approach in its reliance on the skilled persons repertoire, in other words on what the skilled person could already do, cannot be a general test for obviousness as it would render irrelevant many of the The approach to obviousness factors to which the courts have had regard in the assessment of obviousness, some of which I mention below. Since the enactment of the 1623 Statute of Monopolies, which prohibited the grant of a monopoly by the Crown but in section VI created an exception for a patent for the sole working or making of any manner of new Manufactures to the true and first Inventor and Inventors of such Manufactures , the purpose of a grant of a patent has been to encourage innovation. The monopoly granted by the patent rewards the inventor by enabling him or her to charge a higher price than would have been possible if there had been competition. The patent bargain is this: the inventor obtains a monopoly in return for disclosing the invention and dedicating it to the public for use after the monopoly has expired. Lord Mansfield stated the point with his characteristic succinctness in Liardet v Johnson (1778): The condition of giving encouragement is this: that you must specify upon record your invention in such a way as shall teach an artist, when your term is out, to make it and to make it as well by your directions: for then at the end of the term, the public shall have benefit of it. The inventor has the benefit during the term, and the public have the benefit after (quoted in Hulme, On the History of Patent Law (1902) 18 LQR 280, 285 and cited by Lord Sumption in the leading judgment in Generics (UK) Ltd (trading as Mylan) v Warner Lambert Co LLC [2018] UKSC 56; [2019] Bus LR 360, para 17). This overarching principle has survived the amendment of UK patent law after accession to the European Patent Convention. The EPO Technical Board of Appeal has confirmed the principle in, for example, its decision of 12 September 1995 in Agrevo/Triazoles (Case T 939/92) [1996] EPOR 171, para 2.4.2 in which it stated: it has for long been a generally accepted legal principle that the extent of the patent monopoly should correspond to and be justified by the technical contribution to the article [T]his general legal principle was applied in relation to the extent of the patent protection that was justified by reference to the requirements of articles 83 and 84 EPC, the same legal principle also governs the decision that is required to be made under article 56 EPC, for everything falling within a valid claim has to be inventive. See also EXXON/Fuel Oils (Case T 409/91) [1994] OJ EPO 653 at paras 3.3 and 3.4. Articles 83 and 84 of the EPC are concerned with the sufficiency of the disclosure of the invention in the patent application and the support which the description gives to the claims in that application. Section 14(3) and (5) of the 1977 Act correspond to those requirements. Article 56 of the EPO is concerned with the inventive step and provides: An invention shall be considered as involving an inventive step if, having regard to the state of the art, it is not obvious to a person skilled in the article Section 3 of the 1977 Act, which I set out below, corresponds to this requirement. As is well known, section 130(7) of the 1977 Act declares that specified sections of the 1977 Act are so framed as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the European Patent Convention, the Community Patent Convention and the Patent Co operation Treaty have in the territories to which those Conventions apply. Those sections include the sections which govern (a) the principal conditions of validity, that is to say novelty (section 2), inventive step (section 3), capability of industrial application (section 4) sufficiency of disclosure and the support of the claim by the description in the patent application (section 14(3) and (5)), and (b) the power of the court to revoke a patent on application, on grounds which include that the invention is not a patentable invention (which is a reference via section 1 to inter alia sections 2, 3 and 4) and inadequate disclosure in the patent application to enable the skilled person to perform the invention (section 72(1)). It is also well established in the jurisprudence of courts in the United Kingdom that our courts, although not bound to do so, should normally follow the settled jurisprudence of the EPO (especially decisions of its Enlarged Board of Appeal) on the interpretation of the European Patent Convention in the interests of uniformity, especially when the question is one of principle: Merrell Dow Pharmaceuticals Inc v H N Norton & Co Ltd [1996] RPC 76, 82 per Lord Hoffmann; Gales Application [1991] RPC 305, 322 per Nicholls LJ; Actavis UK Ltd v Merck & Co Inc [2009] 1 WLR 1186, paras 45 48 per Jacob LJ; Conor Medsystems Inc v Angiotech Pharmaceuticals Inc [2008] UKHL 49; [2008] 4 All ER 621, para 3 per Lord Hoffmann; Generics (UK) Ltd v H Lundbeck A/S [2009] UKHL 12; [2009] 2 All ER 955, para 35 per Lord Walker of Gestingthorpe; Dr Reddys Laboratories (UK) Ltd v Eli Lilly and Co Ltd [2010] RPC 9, para 102 per Lord Neuberger of Abbotsbury MR; Eli Lilly and Co v Human Genome Sciences Inc [2011] UKSC 51; [2012] 1 All ER 1154; [2012] RPC 6, paras 83 87 per Lord Neuberger. The general principle that the extent of the patent monopoly should correspond to and be justified by the actual technical contribution to the art is thus part of the jurisprudence of both the EPO and the UK courts and, as Lord Sumption observed in Generics v Warner Lambert (above), para 17, the principal conditions of validity, novelty, inventive step, industrial application and sufficiency are all, in one way or another, directed to satisfying the principle thus expressed. There is therefore a balance or symmetry in patent law, as Mr Speck submitted. This case is concerned with the condition which requires there to be an inventive step. Section 3 of the 1977 Act provides: An invention shall be taken to involve an inventive step if it is not obvious to a person skilled in the art, having regard to any matter which forms part of the state of the art by virtue only of section 2(2) above (and disregarding section 2(3) above). Section 2(2) provides: The state of the art in the case of an invention shall be taken to comprise all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of that invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way. These statutory provisions mandate the court to assess whether an invention is obvious by having regard to the state of the art at the priority date of the invention. If the invention is not obvious to the skilled person at that date, section 3 deems the invention to involve an inventive step. The notional skilled person, while having the compendious knowledge of the state of the art which section 2(2) requires, has no inventive capacity. But that does not mean that the skilled person has no skill to take forward in an uninventive way the teaching of the prior article In this case the notional skilled team comprises the clinical pharmacologist and the clinician specialising in urology (para 17 above). That notional team is treated as exercising the professional skills of its members in responding to the teaching of the Daugan patent. It follows that uninventive steps which the skilled team would take after the priority date to implement the Daugan patent are not excluded from consideration in assessing the obviousness of the alleged invention at the priority date. In addressing the statutory question of obviousness in section 3 of the 1977 Act it is common for English courts to adopt the so called Windsurfing/Pozzoli structure which asks these questions: Identify the notional person skilled in the art; Identify the relevant common general knowledge (1) (a) (b) of that person; Identify the inventive concept of the claim in question (2) or if that cannot readily be done, construe it; (3) Identify what, if any, differences exist between the matter cited as forming part of the state of the art and the inventive concept of the claim or the claim as construed; (4) Viewed without any knowledge of the alleged invention as claimed, do those differences constitute steps which would have been obvious to the person skilled in the art or do they require any degree of invention? (Pozzoli SPA v BDMO SA [2007] EWCA Civ 588; [2007] FSR 37, para 23 per Jacob LJ). The fourth question is the statutory question and the first three questions or tasks, the second and third of which involve knowledge and consideration of the invention, are a means of disciplining the courts approach to that fourth question: DSM NVs Patent [2001] RPC 35, para 55 per Neuberger J; Actavis UK Ltd v Novartis AG [2010] EWCA Civ 82; [2010] FSR 18, para 21 per Jacob LJ. In this case the trial judge adopted the Pozzoli approach. There is no dispute about the first question. Mr Waugh emphasises the focus of the second question on the wording of the claim, as I shall discuss below. An alternative approach which the EPO often adopts, is the so called problem and solution approach. The EPO has described the approach in these terms: the Boards of Appeal consistently decide the issue of obviousness on the basis of an objective assessment of the technical results achieved by the claimed subject matter, compared with the results obtained according to the state of the article It is then assumed that the inventor did in fact seek to achieve these results and, therefore, these results are taken to be the basis for defining the technical problem (or, in other words, the objective) of the claimed invention. The next step is then to decide whether the state of the art suggested the claimed solution of this technical problem in the way proposed by the patent in suit (Agrevo/Triazoles (above) para 2.4.3) The test is helpfully summarised in the EPOs Guidelines for Examination in the EPO (November 2017) (Part G Chapter VII) para 5: Problem and solution approach In order to assess inventive step in an objective and predictable manner, the so called problem and solution approach should be applied. Thus deviation from this approach should be exceptional. In the problem and solution approach there are three main stages: (i) (ii) establishing the objective technical problem to be solved, and (iii) considering whether or not the claimed invention, starting from the closest prior art and the objective technical problem, would have been obvious to the skilled person. determining the closest prior art, Again, Mr Waugh urges the application of this approach because of the emphasis which, he submits, it places on the terms of the claim. While both approaches focus on the inventive concept put forward in the claims, neither approach should be applied in a mechanistic way. Both are glosses on the text of section 3 of the 1977 Act and article 56 of the EPC and neither require a literalist approach to the wording of the claim in identifying the inventive concept. In Conor Medsystems Inc v Angiotech Pharmaceuticals Inc [2008] UKHL 49; [2008] RPC 28; [2008] 4 All ER 621, at para 42 Lord Hoffmann endorsed the fact specific approach which Kitchin J set out in Generics (UK) Ltd v H Lundbeck [2007] RPC 32, para 72 where he stated: The question of obviousness must be considered on the facts of each case. The court must consider the weight to be attached to any particular factor in the light of all the relevant circumstances. These may include such matters as the motive to find a solution to the problem the patent addresses, the number and extent of the possible avenues of research, the effort involved in pursuing them and the expectation of success. Kitchin Js list of factors is illustrative and not exhaustive. Another factor which needs to be considered in the present case is the routineness of the research. Much of the interest and controversy which the Court of Appeals judgment has generated relates to how people have understood or misunderstood the significance which that court has attached to the routine nature of the pre clinical and clinical research which I have described. Again, I discuss this below (paras 102 104). Factors which are relevant considerations in the present case include the following. First, it is relevant to consider whether at the priority date something was obvious to try, in other words whether it was obvious to undertake a specific piece of research which had a reasonable or fair prospect of success: Conor v Angiotech (above) para 42 per Lord Hoffmann; MedImmune Ltd v Novartis Pharmaceuticals UK Ltd [2012] EWCA Civ 1234; [2013] RPC 27, paras 90 and 91 per Kitchin LJ. In many cases the consideration that there is a likelihood of success which is sufficient to warrant an actual trial is an important pointer to obviousness. But as Kitchin LJ said in Novartis AG v Generics (UK) Ltd [2012] EWCA Civ 1623, para 55, there is no requirement that it is manifest that a test ought to work; that would impose a straightjacket which would preclude a finding of obviousness in a case where the results of an entirely routine test are unpredictable. As Birss J observed in this case (para 276), some experiments which are undertaken without any particular expectation as to result are obvious. The relevance of the obvious to try consideration and its weight when balanced against other relevant considerations depend on the particular facts of the case. Secondly, it follows that the routine nature of the research and any established practice of following such research through to a particular point may be a relevant consideration which is weighed against the consideration that the claimed process or product was not obvious to try at the outset of a research programme. Again, it is only one of several factors to be weighed in the assessment and it has no primacy and certainly no paramount status as a consideration. Thirdly, the burden and cost of the research programme is relevant. But the weight to be attached to this factor will vary depending on the particular circumstances. This appeal concerns a pharmaceutical patent claiming as an invention a dosage regime. The cost and effort involved in bringing a drug to market through pre clinical and clinical trials are notorious. Mr Waugh referred to the extrajudicial writing of Sir Hugh Laddie, Patents whats invention got to do with it? (in Intellectual property in the new millennium: essays in honour of William R Cornish (2004), p 91 et seq), in which he stated, at p 92: In this field it is apparent that, without patents, few new products would be marketed. The expense in producing a new pharmaceutical is in the research and development stage. Normally, once it has been discovered and given regulatory approval, the manufacture of a new pharmaceutical will be comparatively cheap and its replication by competitors easy. Without the protection of patents, there will be no ability to recoup the cost of the research and development, let alone fund such activities in the future. No private company is going to enter this business unless it can see a reasonable prospect of obtaining a return on investment. The need to facilitate expensive pharmaceutical research is an important policy consideration for legislators and others involved in intellectual property law. It was a factor behind the creation of the Swiss form claim and the EPC 2000 claim as well as the supplementary protection certificate regime under Regulation (EC) 469/2009, which is available after market authorisation to give the patent owner the protection of the patent for up to 15 years, and the data exclusivity regime which Directive 2001/83/EC (article 10) and Regulation (EC) 726/2004 (article 14), which may confer ten years of exclusive marketing protection against competition from generic manufacturers. But the effort involved in research is only one of several factors which may be relevant to the answer to the statutory question of obviousness. Fourthly, the necessity for and the nature of the value judgments which the skilled team would have in the course of a testing programme are relevant considerations as both the trial judge and the Court of Appeal held. Fifthly, the existence of alternative or multiple paths of research will often be an indicator that the invention contained in the claim or claims was not obvious. If the notional skilled person is faced with only one avenue of research, a one way street, it is more likely that the result of his or her research is obvious than if he or she were faced with a multiplicity of different avenues. But it is necessary to bear in mind the possibility that more than one avenue of research may be obvious. In Brugger v Medic Aid Ltd (No 2) [1996] RPC 635, 661, Laddie J stated: [I]f a particular route is an obvious one to take or try, it is not rendered any less obvious from a technical point of view merely because there are a number, and perhaps a large number, of other obvious routes as well. I agree. As a result, the need to make value judgments on how to proceed in the course of a research programme is not necessarily a pointer against obviousness. Sixthly, the motive of the skilled person is a relevant consideration. The notional skilled person is not assumed to undertake technical trials for the sake of doing so but rather because he or she has some end in mind. It is not sufficient that a skilled person could undertake a particular trial; one may wish to ask whether in the circumstances he or she would be motivated to do so. The absence of a motive to take the allegedly inventive step makes an argument of obviousness more difficult. In Agrevo/Triazoles (above), para 2.4.2, the Technical Board of Appeal of the EPO, having referred to the principle that the extent of the patent monopoly should correspond to and be justified by the technical contribution to the art (see para 54 above) made the point in these terms: Moreover, in the Boards judgment, it follows from this same legal principle that the answer to the question what a skilled person would have done in the light of the state of the art depends in large measure on the technical result he had set out to achieve. In other words, the notional person skilled in the art is not to be assumed to seek to perform a particular act without some concrete technical reason: he must, rather, be assumed to act not out of idle curiosity but with some specific technical purpose in mind. This forms the basis of the EPOs problem and solution approach to obviousness which I have quoted in para 61 above. Seventhly, the fact that the results of research which the inventor actually carried out are unexpected or surprising is a relevant consideration as it may point to an inventive step, at least in so far as it suggests that a test was not obvious to try or otherwise the absence of a known target of the research which would make it less likely that the skilled person would conduct a test. Eighthly, the courts have repeatedly emphasised that one must not use hindsight, which includes knowledge of the invention, in addressing the statutory question of obviousness. That is expressly stated in the fourth of the Windsurfing/Pozzoli questions. Where the pattern of the research programme which the notional skilled person would undertake can clearly be foreseen, it may be legitimate to take a step by step analysis. In Gedeon Richter plc v Bayer Schering Pharma AG [2011] EWHC 583 (Pat); [2011] Bus LR D153, Floyd J stated (para 114): I think that the guiding principle must be that one has to look at each putative step which the skilled person is required to take and decide whether it was obvious. Even then one has to step back and ask an overall question as to whether the step by step analysis, performed after the event, may not in fact prove to be unrealistic or driven by hindsight. The obvious danger of a step by step analysis is that the combination of steps by which the inventor arrived at his invention is ascertained by hindsight knowledge of a successful invention. Lord Diplock warned against this in Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd [1972] RPC 346, 362, a warning which judges have reiterated in later cases. I am not persuaded by Mr Specks suggestion that Technograph is concerned only with a case in which a step by step approach was constructed by counsel on cross examination in the absence of evidence of routine steps of research. The case contains a wider warning against the use of hindsight and has been interpreted as doing so. I agree with Birss Js analysis in Hospira UK Ltd v Genentech Inc [2014] EWHC 3857 (Pat), para 240, where he stated: The particular point made in Technograph was that it was wrong to find an invention was obvious if it was only arrived at after a series of steps which involve the cumulative application of hindsight. In some circumstances success at each step in a chain is a necessary predicate for the next one and it is only the hindsight knowledge of the invention as the target which could motivate a skilled person to take each step without knowledge about the next one. In a situation like that, Technograph is important. But the Technograph warning has no bearing in a case in which the steps which the notional skilled person would take can readily be ascertained without the taint of hindsight. Ninthly, it is necessary to consider whether a feature of a claimed invention is an added benefit in a context in which the claimed innovation is obvious for another purpose. In Hallen & Co v Brabantia (UK) Ltd [1991] RPC 195 the Court of Appeal was concerned with an alleged selection patent for a self pulling corkscrew which had a helix coated with polytetrafluoroethylene (PTFE) which was a known friction reducing material. At the priority date PTFE had been used for several years to coat the helix of a twin lever type corkscrew to aid its penetration into the cork. The PTFE coated helix had this effect also on the self pulling corkscrew, a fact which was obvious at the priority date. The PTFE coat when applied to a self pulling corkscrew also had a non obvious benefit of making a striking improvement in the extraction of the cork. The trial judge, Aldous J, held that the patent was invalid on the ground of obviousness because it was obvious to select the features of the claim for the first purpose notwithstanding that it was not obvious for the other purpose: [1989] RPC 307, 326 327. The Court of Appeal agreed with the judge, holding (pp 215 216) that it was self evident that a PTFE coating would improve the penetration by any corkscrew and that the golden bonus or added benefit of the dramatic improvement in extraction of the cork would not found a valid patent as the claimed innovation was obvious for another purpose. Mr Waugh does not challenge this principle but submits that the 181 patent does not involve such an added benefit. ii) Dosage patents The courts are enjoined to have regard to all the relevant facts of particular case in assessing whether an alleged invention is obvious. One of those facts is the nature of the invention. A tenth consideration, therefore, is that here we are concerned with a dosage patent with a Swiss form claim and an EPC 2000 claim. The possibility that a dosage patent with such claims may be valid has been recognized both by the EPO and in the United Kingdom courts. In decision Abbott Respiratory LLC/Dosage regime (G 0002/08) EP:BA:2010:G000208.20100219 the Enlarged Board of Appeal of the EPO decided that, when it was already known to use a medicament to treat a particular illness, it was possible to obtain a patent for a new and inventive dosage regime for that medicament to treat that illness. In so finding the Enlarged Board decided (a) that the dosage patent did not breach the prohibition against the patenting of medical treatment in article 53(c) of the EPC and (b) that a novel dosage regime for the treatment of the same illness could be a specific use under article 54(5) of the European Patent Convention. Recognizing the risks of undue prolongation of patent rights, the Enlarged Board confirmed that the whole body of jurisprudence relating to the assessment of novelty and inventive step generally also applies. In relation to the assessment of obviousness this included consideration whether the dosage regime caused a new technical effect (para 6.3). The EPO has therefore not sanctioned any relaxation of the tests of obviousness in relation to dosage patents. In the United Kingdom the Court of Appeal addressed the question of dosage patents in Actavis UK Ltd v Merck & Co Inc [2009] 1 WLR 1186. The case concerned an application to revoke a patent which included a Swiss form claim for the use of a specified dose of a known and already patented substance, finasteride, in the treatment of androgenic alopecia. The Court of Appeal reversed the trial judges revocation of the patent, holding (para 29) that there was no policy reason why a novel non obvious dosage regime, which was the product of expensive and unpredictable research, should not be rewarded with a patent of a Swiss form claim. Jacob LJ, who delivered the judgment of the court, added this significant qualification (para 32): So holding is far from saying that in general just specifying a new dosage regime in a Swiss form claim can give rise to a valid patent. On the contrary nearly always such dosage regimes will be obvious it is standard practice to investigate appropriate dosage regimes. Only in an unusual case such as the present (where, see below, treatment for the condition with the substance had ceased to be worth investigating with any dosage regime) could specifying a dosage regime as part of the therapeutic use confer validity on an otherwise invalid claim. The reason for this qualification is no mystery. The target of the skilled persons research is in large measure pre determined. As Jacob LJ stated (para 109), the skilled person would aim for a dose as low as possible consistent with effectiveness. That would normally be the appropriate dosage regime. I recognize and respect Birss Js finding of fact that there was no defined standard of minimal efficacy in relation to ED and that this would require the skilled team to make a value judgment (para 36 above). But he also found that it was common general knowledge that regulators were often interested in and could require evidence of the minimum effective dose (para 83 of his judgment) and that the skilled team would be familiar with multiple dose ranging studies as necessary as a generality (para 327 of his judgment). In my view, the inventiveness of the dosage regime falls to be assessed in that context. iii) The role of the appellate court Finally, before addressing directly the question whether the Court of Appeal was entitled to reverse Birss Js finding of non obviousness, I remind myself of the limits of an appellate courts power to overturn the evaluation of a trial judge in this field. Where inferences from findings of primary fact involve an evaluation of numerous factors, the appropriateness of an intervention by an appellate court will depend on variables including the nature of the evaluation, the standing and experience of the fact finding judge or tribunal, and the extent to which the judge or tribunal had to assess oral evidence: South Cone Inc v Bessant, In re Reef Trade Mark [2002] EWCA Civ 763; [2003] RPC 5, paras 25 28 per Robert Walker LJ. An experienced patent judge faced with a challenge to a patent on the ground of obviousness, and who has heard oral evidence including cross examination, carries out an evaluation of all the relevant factors, none of which alone is decisive but each of which must be weighed in the balance in reaching a conclusion. In Biogen Inc v Medeva plc [1997] RPC 1, 45, Lord Hoffmann emphasised the need for appellate caution in reversing the judges evaluation of the facts where the application of a legal standard involved no question of principle but was simply a matter of degree. He held that it would be wrong to interfere with the judges assessment if no question of principle were involved. What is a question of principle in this context? An error of principle is not confined to an error as to the law but extends to certain types of error in the application of a legal standard to the facts in an evaluation of those facts. What is the nature of such an evaluative error? In this case we are not concerned with any challenge to the trial judges conclusions of primary fact but with the correctness of the judges evaluation of the facts which he has found, in which he weighs a number of different factors against each other. This evaluative process is often a matter of degree upon which different judges can legitimately differ and an appellate court ought not to interfere unless it is satisfied that the judges conclusion is outside the bounds within which reasonable disagreement is possible: Assicurazioni Generali SpA v Arab Insurance Group (Practice Note) [2002] EWCA Civ 1642; [2003] 1 WLR 577, paras 14 17 per Clarke LJ, a statement which the House of Lords approved in Datec Electronic Holdings Ltd v United Parcels Service Ltd [2007] UKHL 23; [2007] 1 WLR 1325, para 46 per Lord Mance. Thus, in the absence of a legal error by the trial judge, which might be asking the wrong question, failing to take account of relevant matters, or taking into account irrelevant matters, the Court of Appeal would be justified in differing from a trial judges assessment of obviousness if the appellate court were to reach the view that the judges conclusion was outside the bounds within which reasonable disagreement is possible. It must be satisfied that the trial judge was wrong: see, by way of analogy, In re B (A Child) (Care Proceedings Threshold Criteria) [2013] UKSC 33; [2013] 1 WLR 1911, paras 90 93 per Lord Neuberger, para 203 per Lady Hale. iv) Were claims 7 and 10 of the 181 patent obvious? The patent bargain which Lord Mansfield described and the EPO has used as an overarching principle (paras 53 and 54 above) underpins and creates a symmetry between the various provisions of the 1977 Act which govern the validity of a patent (para 55 above). Bearing in mind that symmetry, the starting point in the assessment of obviousness in this case is the Daugan patent. Its validity is not contested. Indeed, Lillys case assumes its validity. But to be valid it must both disclose and enable. It must disclose the invention, that is that tadalafil may be used as a PDE5 inhibitor for the treatment of ED, to the notional skilled person who uses common general knowledge in construing the patent. It must also enable the notional skilled person to perform the invention using the disclosed matter, common general knowledge, and that persons uninventive skill in making trial and error experiments. In Synthon BV v SmithKline Beecham plc [2005] UKHL 59; [2006] 1 All ER 685, the House of Lords addressed and distinguished the concepts of disclosure and enablement in the context of a challenge to the validity of a patent on the ground of lack of novelty because of anticipation by a prior patent application under section 2(3). But their Lordships discussion of the need for both disclosure and enablement is equally relevant to the validity of a patent under sections 14(3) and 72(1)(c) as Lord Hoffmann stated at para 27 and Lord Walker at paras 63 and 64. One begins therefore with the assumption that the Daugan patent has enabled the skilled person to perform the invention of the use of tadalafil for the treatment of ED. The notional skilled persons task is to implement the ex hypothesi valid patent. That involves finding the appropriate dosage regime having regard to safety, tolerability and effectiveness. The procedures to achieve that end are familiar and routine. In my view it is important to see the Court of Appeals discussion of familiar routine research in this case in this context (paras 102 104 below). In assessing whether the Court of Appeal was entitled to reject the trial judges evaluation it is important to recognize that the Court of Appeal did not reverse any of Birss Js findings of primary fact. Both courts accepted that it was obvious for the skilled team to pursue the pre clinical and clinical research in order to implement Daugan. Motive was clearly present. It was not in dispute that the target of that research was to identify the appropriate dosage regime for tadalafil in the treatment of ED. It was accepted that the skilled team were looking for a dose response relationship and that they would know that, as a generality, multiple dose ranging studies were necessary. There was no challenge to the finding that the discovery of a therapeutic plateau between 25mg and 100mg doses would have surprised the skilled team. Birss J, without relying on hindsight, held that it was very likely that the skilled team would research further by testing doses of 10mg and 5mg. That finding was amply justified as both Mr Muirhead and Lillys expert, Dr Saoud, agreed that the skilled team would not stop the dose ranging studies when they had revealed that therapeutic plateau. Indeed, as Kitchin LJ recorded, Dr Saoud accepted that the decision to test the lower doses, including the 5mg dose, was a no brainer. In short, the skilled team, having embarked on the Phase IIb tests, would have continued their search for a dose response relationship, because the purpose of the Phase IIb study had not been fulfilled. The Court of Appeal was correct to attach significance to this central finding because it undermined several of the factors which Birss J placed in the balance as pointing to non obviousness in para 343 of his judgment. The fact that a 5mg dose was so much lower than the 50mg dose, which was recommended for sildenafil, mentioned in the Daugan patent for tadalafil, and used in the notional skilled teams Phase IIa tests, is neither here nor there. The lack of an expectation of efficacy at a 5mg dose is a factor of little weight if, as was found, the skilled team would be very likely to study such a dose in the search for a dose response relationship. For the same reason the fact that the effectiveness of tadalafil at a dose of 5mg was a surprise can carry little, if any, weight. Similarly, the finding that there was an important value judgment to be made when the therapeutic plateau was identified at the same time as a marketable dose can bear little weight when there is a finding, which is not tainted by hindsight, that the skilled team would continue their tests. I consider that the Court of Appeal was entitled to treat the judges failure to appreciate the logical consequences of the finding that it was very likely that the skilled team would continue the testing as an error of principle which allowed an appellate court to carry out its own evaluation. Lilly also argues that the daily dosing regime by which a person prescribed tadalafil can take the drug once per day rather than on demand in expectation of sexual activity was enabled by the technical effect of the drug, namely the maintenance of efficacy with minimal side effects, which was not obvious and which justified the patent. I disagree for two reasons. First, the judge correctly treated the daily dosing regime as obvious because it was the result of the inevitable discovery of the half life of tadalafil in Phase 1 of the tests. Secondly, claims 7 and 10 are not confined to the daily dosing regime but also cover on demand use of the drug subject to a maximum total dose of 5mg per day. That is fatal to this argument. The inventive concept by which a patentee seeks to justify his or her monopoly must apply to all embodiments falling within the claims which are said to have independent validity. In Brugger v Medic Aid Ltd (No 2) [1996] RPC 635, 656 Laddie J stated: It is not legitimate to define the inventive step as something narrower than the scope of the relevant claims. In particular it is not legitimate to identify a narrow sub group of embodiments falling within the claim and which have certain technical advantages and then to define the inventive step in terms which apply to that sub group but not the rest of the claim. I agree. A similar rule applies in the EPOs problem and solution approach in the requirement that the identified problem must be covered by all embodiments of the claim: see for example (Cognis IP Management GmBH / Satuarated dicarboxylic acids) (Case T 1014/07) EP:BA:2012:T101407.20120702, para 5. The daily dosing regime is not a factor which pointed against obviousness. Standing back from the step by step analysis, it is clear that the skilled team was engaged in the familiar and routine testing of a drug to establish the appropriate dosage regime for tadalafil in order to implement the teaching of the Daugan patent. That target was never in doubt. It was obvious to embark on that exercise and carry out tests in a routine way until that appropriate dose was ascertained. Those tests included the completion of the dose ranging studies which were the purpose of Phase IIb. The fact that tadalafil at the dose of 5mg, while remaining effective as a treatment of ED, also, and unexpectedly, had the additional benefit of reduced side effects was an added benefit which does not prevent the identification of 5mg as the appropriate dose from being obvious. The completion of the Phase IIb dose ranging studies led to the asserted invention. Mr Waugh also submits (a) that the Court of Appeal lost sight of the requirement that obviousness must be assessed by reference to the subject matter of the relevant claims a dose of tadalafil of between 1mg and 5mgs for oral administration up to a maximum total dose of 5mg per day for the treatment of sexual dysfunction and not a loose paraphrase of what the claim or the process by which the dose is discovered, and (b) that the Court of Appeals approach conflicts with the problem and solution approach which the EPO adopts. In support of the first submission, he refers to the statement of Kitchin LJ in MedImmune Ltd v Novartis (above), para 93, that the court must answer a relatively simple question of fact: was it obvious to the skilled but unimaginative addressee to make a product or carry out a process falling within the claim (emphasis added). He also refers to Lord Hoffmanns statement in Conor v Angiotech (above) para 19, that the patentee is entitled to have the question of obviousness determined by reference to his claim and not a vague paraphrase based upon the extent of his disclosure. I am not persuaded that, in the context of a dosage patent, it is necessary for the skilled team to identify in advance of the Phase IIb tests the specific dose which is the subject of the claim. Were it otherwise, many, if not most, dosage regimes would be patentable, whether the results of the tests were surprising or not, simply because the precise doses which ultimately are specified in the claim may not be sufficiently foreseeable. In my view, the MedImmune requirement is met if the step by step approach, without the benefit of hindsight, demonstrates that the skilled team would be very likely to pursue the tests to the point at which they would ascertain the product or process falling within the claims. Conor v Angiotech does not assist Lilly in this context. In that case the relevant claim of the patent taught the use of a stent coated with taxol in the prevention or treatment of recurrent stenosis, or restenosis, which is the constriction of an arterial channel after the insertion of a stent. Conor, which challenged the patent on the ground of obviousness and not on the ground of insufficiency, sought to argue by reference to the patents specification that the patent taught no more than that taxol was worth trying. The House of Lords rejected this challenge, directed attention to the terms of the claim, as section 125 of the 1997 Act requires, rather than the specification, and held that the specification supported that claim. The case is not authority for the proposition that, in all circumstances, obviousness must be assessed by reference to the precise wording of the claim. In relation to the second submission, that the Court of Appeals approach was in conflict with the EPOs problem and solution approach, it is important to recall Jacob LJs words in Actavis v Novartis (above) (para 26) that no one has ever suggested that the problem and solution approach is the only way to go about considering obviousness. Like the Windsurfing/Pozzoli approach, it provides a structured approach which may assist in avoiding the dangers of hindsight and may be more helpful in some cases than in others. No formula should distract the court from the statutory question: Generics (UK) Ltd v Daiichi Pharmaceutical Co Ltd [2009] EWCA Civ 646; [2009] RPC 23, para 17 per Jacob LJ. Further, there is considerable room for judgment and disagreement on the formulation of the objective technical problem to be solved. The EPOs Guidelines for Examination state (Part G Chapter VII, para 5.2): In the context of the problem and solution approach, the technical problem means the aim and task of modifying or adapting the closest prior art to provide the technical effects that the invention provides over the closest prior article The technical problem thus defined is often referred to as the objective technical problem. The Guidelines recognize the difficulty which a court or tribunal faces in formulating the objective technical problem and state: The objective technical problem derived in this way may not be what the applicant presented as the problem in his application. The latter may require reformulation, since the objective technical problem is based on objectively established facts, in particular appearing in the prior art revealed in the course of the proceedings, which may be different from the prior art of which the applicant was actually aware at the time the application was filed. In particular, the prior art cited in the search report may put the invention in an entirely different perspective from that apparent from reading the application only. It is noted that the objective technical problem must be so formulated as not to contain pointers to the technical solution, since including part of a technical solution offered by an invention in the statement of the problem must, when the state of the art is assessed in terms of that problem, necessarily result in an ex post facto view being taken of inventive activity (see T 229/85, [OJ 1987, 237]). The expression technical problem should be interpreted broadly; it does not necessarily imply that the technical solution is an improvement to the prior article Thus the problem could be simply to seek an alternative to a known device or process which provides the same or similar effects or is more cost effective. The Guidelines continue in para 5.3 to discuss the could would approach, which the EPO adopts in the problem and solution approach, stating: the point is not whether the skilled person could have arrived at the invention by adapting or modifying the closest prior art, but whether he would have done so because the prior art incited him to do so in the hope of solving the objective technical problem or in expectation of some improvement or advantage (see T 2/83) When an invention requires various steps to arrive at the complete solution of the technical problem, it should nevertheless be regarded as obvious if the technical problem to be solved leads the skilled person to the solution in a step by step manner and each individual step is obvious in the light of what has already been accomplished and of the residual task still to be solved (see T 623/97 and T 558/00). I am not persuaded that the problem and solution approach would necessarily give a different answer from that of the Court of Appeal. The closest prior art is the Daugan patent and the well established procedures of pre clinical and clinical testing. The problem posed by Daugan was the identification of an appropriate dosage regime. The EPO approach to assessing the obviousness of the claimed invention would then be to apply the could would approach, which means asking not whether the skilled person could have carried out the invention, but whether he would have done so in the hope of solving the underlying technical problem or in the expectation of some improvement or advantage: T 2/83 OJ 1984 265 (Rider/Simethicone tablet), para 7; T 1014/07 (above) paras 7 and 8. The tangible evidence which reveals why the skilled team would have been prompted to come upon the asserted invention is that (a) the team would not have completed the dose ranging studies which Phase IIb requires if it had stopped after the initial dose ranging studies which revealed the therapeutic plateau and (b) Dr Saouds evidence that it was a no brainer to go on with the tests. The judges finding that the skilled team would not have had an expectation of effectiveness at a 5mg dose does not militate against the conclusion that the team would have investigated that dose in the course of a sequence of tests which had as its purpose the solution of the underlying technical problem, which the implementation of the Daugan patent entailed. Foreign judgments The court heard submissions about the judgments of the courts of other countries which are signatories of the EPC on parallel revocation proceedings against the 181 patent. The claimants founded principally on the judgments in the Netherlands and Germany, in which in each case the national court revoked the patent on the ground of obviousness. We were also referred to judgments from other jurisdictions concerning the same patent, including Belgium and Portugal, which upheld the obviousness challenge, and Denmark, Poland and the Czech Republic, which reached a different view. I do not find the judgments particularly helpful. While consistency of approach between the domestic courts of the signatory states to the EPC on matters of principle is desirable, we are not bound by the judgments of other national courts and it is possible that national courts applying the same law may come to different conclusions for various reasons: Conor v Angiotech (above) para 3 per Lord Hoffmann; Dr Reddys Laboratories (UK) Ltd v Eli Lilly (above) paras 79 82 per Jacob LJ, para 92 per Lord Neuberger MR; Actavis UK Ltd v Eli Lilly & Co [2017] UKSC 48; [2017] RPC 21, para 52 per Lord Neuberger. The Dutch District Court of the Hague in Teva Pharmaceuticals Europe BV v ICOS Corpn (14 March 2018) held the patent to be invalid as obvious over Daugan and in its judgment referred in some detail to the decisions of Birss J and the Court of Appeal in this case. The court treated as important the objective of the Phase IIb test and Dr Saouds evidence in the English proceedings (para 4.22). The court recorded (para 4.24) that it had not used the problem and solution approach but that if it had, the outcome would probably not have been different: if one adopted ICOSs formulation of the problem as providing an improved dosing regime the skilled team, having ascertained the half life of tadalafil, would have tested doses during the dose ranging studies that enabled safe and effective daily use. The German Federal Patent Court in its judgment in Hexal AG v ICOS Corpn of 24 October 2017 analysed the problem in the problem and solution approach to be to provide dosages of tadalafil for effective treatment of sexual dysfunction and stated that the skilled team would conduct dose finding studies as part of the standard repertoire in [their] field of activity. It considered and disagreed with the judgment of Birss J on the significance of the unexpected reduction in side effects, which in German case law would be treated as a bonus effect. One can draw some support from judicial decisions in other national courts which reach the same conclusion as one has come to. But it is necessary to recognize not only that the first instance decisions in the Netherlands and Germany are the subject of appeals but also that the evidence led before different courts in parallel proceedings may differ and, even when the same evidence is led, each courts findings of fact based on that evidence may not be the same. For example, the German court attached weight to evidence (a) that sildenafil was effective at a 5mg dose and the skilled person would infer from that that tadalafil would be more effective at low dosages because of its IC50 value (a finding which supported the conclusion that the skilled team had a reasonable expectation of success in a test at that level) and (b) that it was customary to start dose ranging studies with very low initial doses and increase the doses if tolerated. Neither of those findings was made in the English proceedings. Similarly, the Dutch court in its analysis of the Phase IIb studies accepted a mathematical calculation which Tevas expert, Dr Cohen, advanced in those proceedings which was similar to the three factors point which the claimants put on cross examination to Dr Saoud in the English proceedings but which Dr Saoud accepted only as a paper exercise and Birss J rejected as the thinking of the skilled team (paras 297 303 of his judgment). It is also necessary to observe, as Mr Waugh pointed out, that there was also a judgment in favour of Lilly on obviousness in Australia, which is not a signatory of the European Patent Convention. Because of the differences in the evidence led, the manner by which it is tested, and the differing findings to which that evidence gives rise, one may derive support from the approach to the question and methods of reasoning of other national courts but should never rely uncritically on the outcome. Interventions, selection patents and improvement patents In this appeal the court had the benefit of interventions from the IP Federation, Medicines for Europe, the British Generic Manufacturers Association, and the UK BioIndustry Association. The first intervener represents the views of a wide range of UK industry on policy and practice in relation to intellectual property rights. The second and third interveners represent the interests of a range of manufacturers of generic drugs. The fourth intervener is a national trade association for innovative enterprises in the bioscience sector of the UK economy. Several interveners advocated that obviousness be approached by a fact specific assessment on a case by case basis, an approach which is consistent with my approach in this judgment, and resisted the recognition of any one factor as being of overriding importance, whether it be the cost and effort which pre clinical and clinical trials entail, or the standardised and sometimes routine nature of such tests. The UK BioIndustry Association asked for guidance on the relevance in the assessment of obviousness of (a) the reasonable expectation of success as a factor and (b) the problem and solution approach of the EPO. It expressed concern that the judgment of the Court of Appeal might support the view that empirical research in the field of bioscience would not be seen as inventive in so far as the methods of research were well established. The IP Federation similarly expressed concern about a perceived risk that people might extrapolate from statements in the Court of Appeals judgments that the result of routine investigations cannot lead to a valid patent claim. It expressed a particular concern about the breadth of the statement by Lewison LJ (in para 180): in a case which involves routine pre clinical and clinical trials, what would be undertaken as part of that routine is unlikely to be innovative. Its concern was that a simplistic adoption of this phrase as a blanket test without regard to the facts of the specific case would be contrary to the fundamental principles of patent law. I do not interpret the Court of Appeals judgments, including Lewison LJs statement which I have quoted, as supporting such an extrapolation. Kitchin LJ gave the leading judgment, in which he adopted a fact specific assessment based on the facts of this case and involving the weighing up of several factors, and Floyd and Lewison LJJ agreed with his reasoning and conclusions. I do not construe the judgments of the Court of Appeal as supporting any general proposition that the product of well established or routine enquiries cannot be inventive. If that had been what the experienced judges had said, I would have respectfully disagreed. But it is not. As Jacob LJ stated in Actavis v Merck (above) para 29, there is no policy reason why a novel and inventive dosage regime should not be rewarded by a patent. A fortiori, efficacious drugs discovered by research involving standard pre clinical and clinical tests should be rewarded with a patent if they meet the statutory tests (para 54 above). Mr Waugh in his reply attacks Mr Specks proposition that nothing which was already within the skilled persons repertoire could be inventive. He suggests that such a proposition would undermine the so called selection patents and improvement patents. But because I do not accept Mr Specks submission on the skilled persons repertoire in this broad formulation, this judgment does not militate against selection patents or improvement patents. Selection patents are patentable as involving an inventive step if the selection is not arbitrary and is justified by a hitherto unknown technical effect (Agrevo/Triazoles (above) para 2.5.3) or, in other words, when they make a real, novel and non obvious technical advance (Dr Reddys Laboratories (above) para 50 per Jacob LJ; para 104 per Lord Neuberger MR). Improvement in the context of the law of patents is in the most technical sense an invention which comes within the claims of an earlier patent but contains a further inventive step: Buchanan v Alba Diagnostics Ltd [2004] UKHL 5; 2004 SC (HL) 9; [2004] RPC 34, para 32 per Lord Hoffmann. The use of well known research tests of itself does not render such selections and improvements obvious. Summary The balance or symmetry in patent law and the pre established or at least readily foreseeable target of the skilled teams tests hold the key to the resolution of this dispute. The Daugan patent is ex hypothesi valid and it is not in dispute that it discloses an invention that is the use of tadalafil in the treatment of ED in a manner which enables the skilled person to perform it as section 14(3) of the 1977 Act requires. The task which the notional skilled team would undertake was that of implementing Daugan. The target of the skilled team would be to ascertain the appropriate dose, which would usually be the lowest effective dose. The skilled team would know of that target from the outset of its research. The pre clinical and clinical tests involved familiar and routine procedures and normally progressed to the discovery of the dose response relationship in Phase IIb. In this case the trial judges findings of what would have been the sequence of the tests, which did not depend upon hindsight, included the finding, which the evidence clearly justified, that the team, having found a therapeutic plateau, would be very likely to test lower doses and so come upon the dosage regime which is the subject matter of the patent. For the reasons which I have given above, I am satisfied that the Court of Appeal was entitled to interfere with the trial judges assessment of obviousness and to hold that the 181 patent was invalid for lacking an inventive step. The claimants other challenges Having reached that conclusion, it is not necessary to address the claimants alternative arguments for revocation on the grounds of non disclosure by the priority document, anticipation, and added matter. Conclusion I would dismiss the appeal.

Tadalafil is the generic name for a drug which is sold under the brand name CIALIS for the treatment of, among other things, erectile dysfunction (ED). Tadalafil is a competitor (second in class) to sildenafil, which was and is sold under the brand name, VIAGRA. The patent which is the subject of this appeal is EP(UK) 1,173,181 (the 181 patent). It is owned by ICOS and exclusively licensed to Eli Lilly (collectively Lilly). It was filed on 26 April 2000 and granted on 15 October 2003. The 181 patent relates to the use of tadalafil in a dosage form for the treatment of ED. This case is concerned with section 3 of the Patents Act 1977 (1977 Act): Section 2(2) of the 1977 Act provides: An invention shall be taken to involve an inventive step if it is not obvious to a person skilled in the art, having regard to any matter which forms part of the state of the art by virtue only of section 2(2) above (and disregarding section 2(3) above). The state of the art in the case of an invention shall be taken to comprise all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of that invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way. These statutory provisions mandate the court to assess whether an invention is obvious by having regard to the state of the art at the priority date of the invention. If the invention is not obvious to the skilled person at that date, section 3 deems the invention to involve an inventive step. Lilly asserts that the essence of the invention is the discovery that tadalafil is effective in treating ED at a low dose and with minimal side effects. This discovery has allowed the drug to be taken daily (for chronic use) rather than on demand, avoiding the need to anticipate when sexual activity might occur. This is, Lilly claims, a significant technical advantage as sildenafil is approved for on demand use only. The respondents raised proceedings to revoke the 181 patent. Lilly defended the claim and counterclaimed that the respondents were threatening to infringe its patent. The High Court held that a 5mg daily dose of tadalafil was not obvious as a treatment for ED and therefore concluded that the 181 patent involves an inventive step. The Court of Appeal allowed the appeal on the ground that the 181 patent lacked inventive step. Lilly appealed to the Supreme Court. The Supreme Court unanimously dismisses the appeal. Lord Hodge gives the sole judgment with which the other Justices agree. Since the enactment of the 1623 Statute of Monopolies, the purpose of a grant of a patent has been to encourage innovation. The patent bargain is this: the inventor obtains a monopoly in return for disclosing the invention and dedicating it to the public for use after the monopoly has expired [53]. This overarching principle has survived the amendment of UK patent law after accession to the European Patent Convention [54]. In addressing the statutory question of obviousness in section 3 of the 1977 Act it is common for English courts to adopt the so called Windsurfing/Pozzoli structure [60]. An alternative approach which the EPO often adopts is the so called problem and solution approach [61]. While both approaches focus on the inventive concept put forward in the claims, neither approach should be applied in a mechanistic way [62]. The question of obviousness must be considered on the facts of each case [63]. Factors which are relevant considerations in the present case include the following [64]. First, it is relevant to consider whether at the priority date something was obvious to try, in other words whether it was obvious to undertake a specific piece of research which had a reasonable or fair prospect of success [65]. Secondly, it follows that the routine nature of the research and any established practice of following such research through to a particular point may be a relevant consideration [66]. Thirdly, the burden and cost of the research programme is relevant [67]. Fourthly, the necessity for and the nature of the value judgments which the skilled team would have in the course of a testing programme are relevant considerations [68]. Fifthly, the existence of alternative or multiple paths of research will often be an indicator that the invention contained in the claim or claims was not obvious [69]. Sixthly, the motive of the skilled person is a relevant consideration. The notional skilled person is not assumed to undertake technical trials for the sake of doing so but rather because he or she has some end in mind [70]. Seventhly, the fact that the results of research which the inventor actually carried out are unexpected or surprising is a relevant consideration as it may point to an inventive step [71]. Eighthly, the courts have repeatedly emphasised that one must not use hindsight, which includes knowledge of the invention, in addressing the statutory question of obviousness [72]. Ninthly, it is necessary to consider whether a feature of a claimed invention is an added benefit in a context in which the claimed innovation is obvious for another purpose [73]. A tenth consideration is the nature of the invention. In this case, the Court is concerned with a dosage patent with a Swiss form claim and an EPC 2000 claim. The possibility that a dosage patent with such claims may be valid has been recognized both by the EPO and in the United Kingdom courts [74]. In the present dispute, the Court considers that the balance or symmetry in patent law and the pre established or at least readily foreseeable target of the skilled teams tests hold the key to its resolution. The prior art discloses an invention that is the use of tadalafil in the treatment of ED in a manner which enables the skilled person to perform it. The task which the notional skilled team would undertake was that of implementing patent EP 0 839 040 (the Daugan patent), which was the nearest prior article The Daugan patent had disclosed that doses of tadalafil for the treatment of ED will generally be in the range of 0.5mg to 800mg daily for the average adult patient. The target of the skilled team would be to ascertain the appropriate dose, which would usually be the lowest effective dose. The skilled team would know of that target from the outset of its research. The pre clinical and clinical tests involved familiar and routine procedures and normally progressed to the discovery of the dose response relationship in Phase IIb [105]. In this case the trial judges findings of what would have been the sequence of the tests, which did not depend upon hindsight, included the finding, which the evidence clearly justified, that the team, having found a therapeutic plateau, would be very likely to test lower doses and so come upon the dosage regime which is the subject matter of the patent [105]. The Court considers that the Court of Appeal was entitled to treat the judges failure to appreciate the logical consequences of the finding that it was very likely that the skilled team would continue the testing as an error of principle which allowed an appellate court to carry out its own evaluation [82]. As such, the Court is satisfied that the Court of Appeal was entitled to interfere with the trial judges assessment of obviousness and to hold that the 181 patent was invalid for lacking an inventive step [105].

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The interim injunction the subject of this application has attracted much attention. Whatever the decision of the Supreme Court, it will probably give rise to further, entirely legitimate, debate on the value of such injunctions in the internet age. But the majority of this Court has concluded that, in the light of legal principles that were effectively uncontroversial and for reasons more particularly summarised in paras 44 to 45 below, the application for permission to appeal should be granted and the interim injunction continued until trial or further order. The ground on which the Court acts is to preserve the privacy interests of the appellant, his partner and their young children in England and Wales, pending a trial. Without the injunction, there will be further unrestricted and extensive coverage in hard copy as well as other media in England and Wales, and the purpose of any trial will be largely undermined. On the basis of the case law, the fact that there has been significant internet and social media coverage (and limited hard copy publication outside the jurisdiction) which already invades the privacy of the appellant and his family is not decisive. News Group Newspapers Ltds (NGNs) purpose in applying to set aside the interim injunction is to add extensively and in a qualitatively different medium to such invasions, without, on present evidence, having any arguably legitimate basis for this and at the risk only of having to pay damages after a trial. Some may still question whether the case merits the weight of legal attention which it has received. But the law is there to protect the legitimate interests of those whose conduct may appear unappealing, as well as of children with no responsibility for such conduct. The Supreme Court must in any event apply the law as it has been laid down by Parliament, paying due regard to the case law which Parliament has required it to take account. The Court must do so in the present case in relation to what, on present evidence, appears to be a clearly unjustified proposed further invasion of the relevant privacy interests one which is unsupported by any countervailing public interest in a legal sense, however absorbing it might be to members of the public interested in stories about others private sexual encounters. At trial, it will be open to the respondents to seek to show some genuine public interest in publication. But none has been shown to date, and, pending trial, the point of any trial should not be prejudged or rendered irrelevant by unrestricted disclosure. The Court is well aware of the lesson which King Canute gave his courtiers. Unlike Canute, the courts can take steps to enforce its injunction pending trial. As to the Mail Onlines portrayal of the law as an ass, if that is the price of applying the law, it is one which must be paid. Nor is the law one sided; on setting aside John Wilkes outlawry for publishing The North Briton, Lord Mansfield said that the law must be applied even if the heavens fell: R v Wilkes (1768) 4 Burr 2527, 98 ER 327 (347). It is unlikely that the heavens will fall at our decision. It will simply give the appellant, his partner and their young children a measure of temporary protection against further and repeated invasions of privacy pending a full trial which will not have been rendered substantially irrelevant by disclosure of relatively ancient sexual history. The facts We can for the most part take the facts from Jackson LJs judgment in the Court of Appeal. PJS, the claimant (now the appellant) is in the entertainment business and is married to YMA, a well known individual in the same business. They have young children. In 2007 or 2008, the claimant met AB and, starting in 2009, they had occasional sexual encounters. AB had a partner, CD. By text message on 15 December 2011, the claimant asked if CD was up for a three way, to which AB replied that CD was. The three then had a three way sexual encounter, after which the sexual relationship between PJS and AB came to an end, though they remained friends for some time. By or in early January 2016, AB and CD approached the editor of the Sun on Sunday, and told him about their earlier sexual encounters with PJS. The editor notified PJS that he proposed to publish the story. PJSs case is that publication would breach confidence and invade privacy. He brought the present proceedings accordingly, and applied for an interim injunction to restrain the proposed publication. Cranston J refused an interim injunction on 15 January, but the Court of Appeal (Jackson and King LJJ) on 22 January 2016 allowed an appeal and restrained publication of the relevant names and of details of their relationship: [2016] EWCA Civ 100. The Court provided the parties with its full judgment, but published only a redacted version omitting the names and details. The injunction was effective for eleven weeks, but AB took steps to get the story published in the United States. In consequence a magazine there published an account of PJSs sexual activities on 6 April 2016, naming those involved. But, as a result of representations by the appellants solicitors, it restricted publication to hardcopy editions only, and geo blocked online publication so as to restrict this to the United States. The evidence is that, apart from the one further state publication, the story was not taken up in America. Some other similar articles followed in Canada and in a Scottish newspaper. But, whatever the source, details started to appear on numerous websites, one of which contained equivalent detail to that which had appeared in the American magazine, as well as in social media hashtags. Various English and Welsh newspapers have in these circumstances published vigorous complaints about their own inability to publish material which was available on the internet. The Times on 8 April 2016 reported that the injunction was being flouted on social media after the well known man was named in the US and that the Society of Editors had condemned such injunctions as bringing the whole system into disrepute. The Sun on 10 April 2016 called on our loyal readers to help end the farce that means we cant tell you the full story of the celebrity fathers threesome by writing to their MPs to get them to voice the public outcry in parliament and bring an end to this injustice. It set out a suggested form of letter. It appears that an MP was by 11 April 2016 proposing to name the appellant in Parliament, something that intervention by the Speaker may have prevented. The Mail Online on 14 April 2016 reported that it had held a survey which found that 20 percent of the public already know who he is while others said they know how to find out. The online tool Google Trends shows a massive increase in the number of internet searches relating to the appellant and YMA by their true names. The Court of Appeal noted that the appellants solicitors have been assiduous in monitoring the internet and taking steps, wherever possible, to secure removal of offending information from URLs and web pages, but concluded that this was a hopeless task: the same information continued to reappear in new places, and tweets and other forms of social networking also ensured its free circulation. On the other hand, the evidence of the appellants solicitor, Mr Tait, is that social media are responding to objections of invasion of privacy, that a material number of links has been removed, disabled or become inactive and that Mr Tait is confident that, with the continuation of the injunction, this process will continue and it will become increasingly difficult to identify the appellant online. In the light of the Court of Appeals assessment and its own review of the material available, the Supreme Court must however assume that a significant body of internet material identifying those involved by name and reproducing details from the original American publication about their alleged activities still exists and will continue to do so for the foreseeable future. On 12 April 2016 NGN applied to the Court of Appeal to set aside the interim injunction granted on 22 January 2016, on the grounds that the protected information was now in the public domain, and that the injunction therefore served no useful purpose and was an unjustified interference with NGNs own rights under article 10 of the European Convention on Human Rights (ECHR). By a judgment published in slightly redacted terms on 18 April 2016, the Court of Appeal (Jackson, King and Simon LJJ) discharged the injunction: [2016] EWCA Civ 393. On 21 April 2016 the Supreme Court heard the appellants application for permission to appeal together with submissions relevant to the appeal, if permission was granted, and continued the interim injunction pending the delivery of the present judgment. The statutory provisions The appeal falls to be determined by reference to the Human Rights Act 1998 (HRA) and the ECHR rights scheduled to it. Those rights include articles 8 and 10, reading: Article 8 Right to respect for private and family life. 1. Everyone has the right to respect for his private and family life, his home and his correspondence. 2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others. Article 10 Freedom of expression. 1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers. This article shall not prevent States from requiring the licensing of broadcasting, television or cinema enterprises. 2. The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary. HRA Section 12 provides: Freedom of expression. (1) This section applies if a court is considering whether to grant any relief which, if granted, might affect the exercise of the Convention right to freedom of expression. (2) If the person against whom the application for relief is made (the respondent) is neither present nor represented, no such relief is to be granted unless the court is satisfied a. that the applicant has taken all practicable steps to notify the respondent; or b. that there are compelling reasons why the respondent should not be notified. (3) No such relief is to be granted so as to restrain publication before trial unless the court is satisfied that the applicant is likely to establish that publication should not be allowed. (4) The court must have particular regard to the importance of the Convention right to freedom of expression and, where the proceedings relate to material which the respondent claims, or which appears to the court, to be journalistic, literary or artistic material (or to conduct connected with such material), to a. the extent to which i. the material has, or is about to, become available to the public; or ii. it is, or would be, in the public interest for the material to be published; b. any relevant privacy code. Cranston Js decision When refusing an injunction on 15 January 2016, Cranston J: accepted that the appellant had a reasonable expectation that his sexual (i) activities would remain private, (ii) added that he was especially troubled by the childrens privacy interests under ECHR article 8, though these could not operate as a trump card, (iii) rejected the respondents suggestion that the proposed publication went to any relevant matter of public debate, (iv) identified the appellant and his partner as portraying an image to the world of a committed relationship, accepted that commitment may not entail monogamy, but concluded that there was a public interest in correcting the image by disclosing that the appellant had engaged in the sort of casual sexual relationships demonstrated by the evidence, and (v) on that basis, and noting that the threshold test for granting an interim injunction was in this context higher than the generally applicable test in American Cyanamid Co v Ethicon Ltd [1975] AC 396, refused an injunction. The Court of Appeal judgment of 22 January 2016 The Court of Appeal in its judgment of 22 January 2016 held that there were two significant shortcomings in the judges approach, which enabled (or required) it to re open the matter: (i) although the judge had correctly identified the childrens article 8 privacy rights, he had not explained how he had taken them into account; (ii) once it was accepted that commitment may not entail monogamy, there was no false image to require correction by disclosure of the appellants occasional sexual encounters with others. In this connection, the Court of Appeal concluded positively that on the evidence before it the image presented by the appellant and his partner had been one of commitment not monogamy. The Court of Appeal went on to identify the well established principle that kiss and tell stories which do no more than satisfy readers curiosity about the private lives of other persons, however well known to the public, do not serve any legally recognised public interest: see eg Couderc and Hachette Filipacchi Associs v France (Application No 41454/07), paras 100 101 and Axel Springer AG v Germany (Application No 39954/08), para 91. The Supreme Court will revert to this principle in paras 22 25 below. There was a respondents notice alleging additional grounds for upholding the judges decision. In this connection, the Court of Appeal agreed with the judge that the proposed publication did not go to any matter of public debate: para 12(iii) above. Referring to Hutcheson v News Group Newspapers Ltd [2011] EWCA Civ 808, which itself refers back to Terry v Persons Unknown [2010] EWHC 119 (QB), the Court accepted that the respondents were entitled to publish articles critical of people in the public eye, even though there was nothing illegal about their conduct. But it noted that the appellant had an expectation that his sexual encounters would remain private, that the proposed story would, if published, be devastating for him and that on any proper balancing his article 8 right to privacy must prevail over the respondents article 10 right to publish an account of the adultery. It added that the position of the children was also a factor to consider: the proposed article would generate a media storm and much public interest in the appellants family, including increased press attention to the children, meaning that the children would in due course learn about the relevant matters from school friends and the internet. On the evidence before the Court, the appellant was likely to establish at trial that publication should not be allowed, and had therefore satisfied the test in section 12(3) of the Human Rights Act 1998. The appeal was therefore allowed and an injunction granted. The Court of Appeal judgment of 18 April 2016 Jackson LJ, with which King and Simon LJJ agreed: In its judgment of 18 April 2016, the Court of Appeal in a judgment given by (i) accepted that claims based on confidentiality were to be distinguished from claims based on privacy, in that, while claims for confidentiality generally fail once information has passed into the public domain, the law extends greater protection to privacy rights than rights in relation to confidential material (paras 35 36); (ii) concluded that a claim for misuse of private information can and often will survive when information is in the public domain, continuing (para 39): It depends on how widely known the relevant facts are. In many situations the claim for misuse of private information survives, but is diminished because that which the defendant publishes is already known to many readers. The publication is an invasion of privacy and hurtful for the claimant, but is not as egregious as it would otherwise be. That does not deprive the claimant of his claim for damages, but it weakens his claim for an injunction. This is for two reasons. First, the article 8 claim carries less weight, when the court carries out the balancing exercise of article 8 rights as against article 10 rights. Secondly, injunctions are a discretionary remedy. The fact that material is generally known is relevant to the exercise of the courts discretion. (iii) added that: 40. In this regard it is important to note that HRA section 12 does not affect the existence of the claimants article 8 claim nor does it provide any defence to the tort of misusing private information. The effect of section 12 is twofold. First, it enhances the weight which article 10 rights carry in the balancing exercise. Secondly, it raises the hurdle which the claimant must overcome in order to obtain an interim injunction. 41. Although it will be a matter for the trial judge at the end of the day, I adhere to the view I expressed in January, namely that the story which NGN proposes to publish is likely to be a breach of the claimants article 8 rights. What has changed is the weight which the claimants article 8 rights carry, when balanced against NGNs article 10 rights. Also the fact that material is widely known must be relevant to the courts discretion. (iv) accepted that the court should not set aside an injunction merely because it has met with widespread disobedience or defiance (para 42), but noted that this was not a case of disobedience by the media, and that the difficulty about any submission of defiance was that the Internet and social networking have a life of their own; furthermore, that an English court has little control over what foreign newspapers and magazines may publish (para 44); and that it does appear that those who want to find out the individuals identities have already done so (para 45). In these circumstances, the Court concluded, in Jackson LJs words, that 47. In the situation which now prevails, I still think that the claimant is likely to establish a breach of ECHR article 8. But, notwithstanding the limited public interest in the proposed story, I do not think that the claimant is likely to obtain a permanent injunction. I reach this conclusion for seven reasons: i) Knowledge of the relevant matters is now so widespread that confidentiality has probably been lost. ii) Much of the harm which the injunction was intended to prevent has already occurred. The relatives, friends and business contacts of PJS and YMA all know perfectly well what it is alleged that PJS has been doing. The wall to wall excoriation which the claimant fears (CTB at 24) has been taking place for the last two weeks in the English press. There have been numerous headlines such as celebrity love cheat and Gag celeb couple alleged to have had a threesome. Many readers know to whom that refers. iii) The material which NGN wishes to publish is still private, in the sense that it concerns intimate sexual matters. I reject Mr Millars submission that PJSs article 8 rights are no longer engaged at all. First, there are still many people, like Mr Brownes hypothetical purchaser of the Financial Times, who do not know about PJSs sex life. Secondly, NGNs planned publication in England will be a further unwelcome intrusion into the private lives of PJS and his family. On the other hand, it will not be a shock revelation, as publication in January would have been. The intrusion into the private lives of PJS and his family will be an increase of what they are suffering already. If the interim injunction stands, newspaper articles will continue to appear re cycling the contents of the redacted judgment and calling upon PJS to identify himself. Websites discussing the story will continue to pop up. As one is taken down, another will appear. This process will continue up to the trial date. iv) v) As stated in para 59 of the previous redacted judgment (para 61 of the full judgment), NGN is entitled to publish articles criticising people in the public eye. Therefore it has an article 10 right to publish an account of PJSs conduct. That article 10 right has to be balanced against PJSs article 8 right for his sexual liaisons to remain a private matter. The need to balance article 8 rights against article 10 rights means that there is a limit to how far the courts can protect individuals against the consequences of their own actions. vi) As a result of recent events, the weight attaching to the claimants article 8 right to privacy has reduced. It cannot now be said that when the day of trial comes, PJSs article 8 right is likely to prevail over NGNs article 10 right to freedom of expression, such as to warrant the imposition of a permanent injunction. vii) Finally, the court should not make orders which are ineffective. It is in my view inappropriate (some may use a stronger term) for the court to ban people from saying that which is common knowledge. This must be relevant to the exercise of the court's discretion. Injunctions are a discretionary remedy. 48. I turn next to the position of YMA and the children. As explained in para 39 of my previous judgment, the interests of other family members, in particular children, are a significant consideration, but they cannot be a trump card. Paragraph 61 of the redacted judgment (para 63 of the full judgment) referred to the likelihood that, in the absence of an injunction, the children would in the future learn about these matters from school friends or the Internet. That is now a less material consideration. In my view, whether or not the court grants an injunction, it is inevitable that the two children will in due course learn about these matters. Analysis of the Court of Appeals judgment of 18 April 2016 (i) HRA section 12 There is, as all members of the Supreme Court conclude, a clear error of law in the Court of Appeals reasoning in relation to section 12. For reasons given in para 20 below, it consists in the self direction that section 12 enhances the weight which article 10 rights carry in the balancing exercise (para 40). The Court of Appeals further self direction, that section 12 raises the hurdle which the claimant must overcome in order to obtain an interim injunction is unexceptionable, in so far as section 12 replaces the general American Cyanamid test, focused on the balance of convenience, with a test of whether the appellant is likely to establish that publication should not be allowed at trial. The position was stated more particularly by Lord Nicholls said in Cream Holdings Ltd v Banerjee [2004] UKHL 44; [2005] 1 AC 253, para 22, in a speech with which the other members of the House agreed: Section 12(3) makes the likelihood of success at trial an essential element in the courts consideration of whether to make an interim order. There can be no single, rigid standard governing all applications for interim restraint orders. Rather, on its proper construction the effect of section 12(3) is that the court is not to make an interim restraint order unless satisfied the applicants prospects of success at the trial are sufficiently favourable to justify such an order being made in the particular circumstances of the case. As to what degree of likelihood makes the prospects of success sufficiently favourable, the general approach should be that courts will be exceedingly slow to make interim restraint orders where the applicant has not satisfied the court he will probably (more likely than not) succeed at the trial. In general, that should be the threshold an applicant must cross before the court embarks on exercising its discretion, duly taking into account the relevant jurisprudence on article 10 and any countervailing Convention rights. But there will be cases where it is necessary for a court to depart from this general approach and a lesser degree of likelihood will suffice as a prerequisite. Circumstances where this may be so include those mentioned above: where the potential adverse consequences of disclosure are particularly grave, or where a short lived injunction is needed to enable the court to hear and give proper consideration to an application for interim relief pending the trial or any relevant appeal. The Court of Appeals initial self direction is however contrary to considerable authority, including authority at the highest level, which establishes that, even at the interlocutory stage, (i) neither article has preference over the other, (ii) where their values are in conflict, what is necessary is an intense focus on the comparative importance of the rights being claimed in the individual case, (iii) the justifications for interfering with or restricting each right must be taken into account and (iv) the proportionality test must be applied: see eg In re S (A Child) (Identification: Restrictions on Publication) [2004] UKHL 47; [2005] 1 AC 593, para 17, per Lord Steyn, with whom all other members of the House agreed; McKennitt v Ash [2006] EWCA Civ 1714; [2008] QB 73, para 47, per Buxton LJ, with whom the other members of the Court agreed; and Mosley v News Group Newspapers Ltd [2008] EWHC 687 (QB), para 28, per Eady J, describing this as a very well established methodology. The exercise of balancing article 8 and article 10 rights has been described as analogous to the exercise of a discretion: AAA v Associated Newspapers Ltd [2013] EWCA Civ 554, para 8). While that is at best only an analogy, the exercise is certainly one which, if undertaken on a correct basis, will not readily attract appellate intervention. The Court of Appeals error in its initial self direction is, however, one of potential significance, since it necessarily affects the balance. By itself it would require the Supreme Court to re exercise the discretion which the Court of Appeal exercised in setting aside the injunction which it had previously granted. But there are further aspects of the Court of Appeals treatment of the issues which together lead to the same conclusion. (ii) The reference to a limited public interest The Court of Appeal in my opinion also erred in the reference it made, at three points in its judgment (paras 13, 30 and 47), to there being in the circumstances even a limited public interest in the proposed story and in its introduction of that supposed interest into a balancing exercise (para 47(v)). In identifying this interest, the Court of Appeal relied upon a point made by an earlier Court of Appeal in Hutcheson (and before that by Eady J in Terry), namely that the media are entitled to criticise the conduct of individuals even where is nothing illegal about it. That is obviously so. But criticism of conduct cannot be a pretext for invasion of privacy by disclosure of alleged sexual infidelity which is of no real public interest in a legal sense. It is beside the point that the appellant and his partner are in other contexts subjects of public and media attention factors without which the issue would hardly arise or come to court. It remains beside the point, however much their private sexual conduct might interest the public and help sell newspapers or copy. The matter is well put by Anthony Lester (Lord Lester of Herne Hill) in a recent book, Five Ideas to fight for (Oneworld, 2016), p 152: News is a business and not only a profession. Commercial pressures push papers to publish salacious gossip and invasive stories. It is essential to ensure that those pressures do not drive newspapers to violate proper standards of journalism. That criticism of supposed infidelity cannot be the guise under which the media can disclose kiss and tell stories of no public interest in a legal sense is confirmed by a series of European Court of Human Rights (ECtHR) judgments. Thus, in Armonien v Lithuania [2009] EMLR 7, para 39, the Court emphasised the duty of the press to impart information and ideas on matters of public interest, but noted that a fundamental distinction needs to be made between reporting facts even if controversial capable of contributing to a debate in a democratic society and making tawdry allegations about an individuals private life; In Mosley v United Kingdom [2012] EMLR 1, para 114, the Court reiterated that there is a distinction to be drawn between reporting facts even if controversial capable of contributing to a debate of general public interest in a democratic society, and making tawdry allegations about an individuals private life (see Armonien, para 39). In respect of the former, the pre eminent role of the press in a democracy and its duty to act as a public watchdog are important considerations in favour of a narrow construction of any limitations on freedom of expression. However, different considerations apply to press reports concentrating on sensational and, at times, lurid news, intended to titillate and entertain, which are aimed at satisfying the curiosity of a particular readership regarding aspects of a persons strictly private life (Von Hannover v Germany (2005) 40 EHRR 1, para 65; Hachette Filipacchi Associs (ICI PARIS) v France, no 12268/03, para 40; and MGN Ltd v United Kingdom (2001) 53 EHRR 5, para 143). Such reporting does not attract the robust protection of article 10 afforded to the press. As a consequence, in such cases, freedom of expression requires a more narrow interpretation (see Socit Prisma Presse v France (dec), nos 66910/01 and 71612/01, 1 July 2003; Von Hannover, cited above, para 66; Leempoel & SA E Cin Revue v Belgium, no 64772/01, para 77, 9 November 2006; Hachette Filipacchi Associs (ICI PARIS), cited above, para 40; and MGN Ltd, cited above, para 143. Most recently, in Couderc and Hachette Filipacchi Associs v France (Application No 40454/07), paras 100 101, the Court said: 100. The Court has also emphasised on numerous occasions that, although the public has a right to be informed, and this is an essential right in a democratic society which, in certain special circumstances, can even extend to aspects of the private life of public figures, articles aimed solely at satisfying the curiosity of a particular readership regarding the details of a persons private life, however well known that person might be, cannot be deemed to contribute to any debate of general interest to society (see Von Hannover, cited above, para 65; MGN Ltd v United Kingdom, no 39401/04, para 143, 18 January 2011; and Alkaya v Turkey, no. 42811/06, para 35, 9 October 2012). 101. Thus, an article about the alleged extra marital relationships of high profile public figures who were senior State officials contributed only to the propagation of rumours, serving merely to satisfy the curiosity of a certain readership (see Standard Verlags GmbH v Austria (No 2), no 21277/05, para 52, 4 June 2009). Equally, the publication of photographs showing scenes from the daily life of a princess who exercised no official functions was aimed merely at satisfying the curiosity of a particular readership (see Von Hannover, cited above, para 65, with further references). The Court reiterates in this connection that the public interest cannot be reduced to the publics thirst for information about the private life of others, or to the readers wish for sensationalism or even voyeurism. In these circumstances, it may be that the mere reporting of sexual encounters of someone like the appellant, however well known to the public, with a view to criticising them does not even fall within the concept of freedom of expression under article 10 at all. But, accepting that article 10 is not only engaged but capable in principle of protecting any form of expression, these cases clearly demonstrate that this type of expression is at the bottom end of the spectrum of importance (compared, for example, with freedom of political speech or a case of conduct bearing on the performance of a public office). For present purposes, any public interest in publishing such criticism must, in the absence of any other, legally recognised, public interest, be effectively disregarded in any balancing exercise and is incapable by itself of outweighing such article 8 privacy rights as the appellant enjoys. (iii) The distinction between rights of confidence and privacy rights Mr Desmond Browne QC for the appellant submits the Court of Appeal also erred by too close an assimilation of a claim based on the tort of invasion of privacy with breach of confidence. Jackson LJ recognised, correctly, that the former attracts greater protection than the latter (para 36 of his judgment: see para 17(i) above). But he went on in para 39 to suggest that, whether a claim for misuse of private information will survive when information is in the public domain depends on how widely known the relevant facts are. That suggests a quantitative test, measuring what has already been disclosed with what is yet undisclosed. That is a test which is not only appropriate but potentially decisive in the context of an application based on confidentiality, as witnessed famously by Sunday Times v United Kingdom (No 2) (Spycatcher No 2) (1991) 14 EHRR 229, paras 54 55. There, the loss of secrecy by 30 July 1987 was central to the European Court of Human Rights conclusion that injunctions could after that date no longer be justified either as necessary to ensure a fair trial or to protect national security. The promotion of the efficiency and reputation of the Security Service constituted insufficient justification. However, different considerations apply to the present privacy claim. First, as Mr Browne submits, a quantitative approach overlooks the invasiveness and distress involved, even in repetition of private material. Second, open hard copy exposure, as well no doubt as further internet exposure, is likely to add significantly to the overall intrusiveness and distress involved. I return to the second point in paras 34 37 below. As to the first point, there is substantial recent authority recognising that even the repetition of known facts about an individual may amount to unjustified interference with the private lives not only of that person but also of those who are involved with him: JIH v News Group Newspapers Ltd [2010] EWHC 2818 (QB), para 59, per Tugendhat J. The Court of Appeal referred (in para 25) to the submission which Mr Browne made before it to like effect, and to the supporting authority which he cited, but did not, Mr Browne submits, give effect to it in its decision. The point made in JIH is worth elaborating for its resonance on this appeal. It can be traced back to Attorney General v Guardian Newspapers Ltd (No 2) [1990] 1 AC 109, 260F, where Lord Keith gave examples of circumstances in which a person could be entitled to restrain disclosure of private information, which had received widespread publication abroad. It was taken up by Eady J in McKennitt v Ash [2006] EMLR 178, para 81, by Tugendhat J in Green Corns Ltd v Claverley Group Ltd [2005] EMLR 748, paras 78 79, where he said that the question was not whether information was generally accessible, but rather whether an injunction would serve a useful purpose and by Briggs J in Rocknroll v News Group Newspapers Ltd [2013] EWHC 24 (Ch), paras 22 26, where he also said that HRA section 12(4)(a)(i) in his judgment creates no separate or different test , at least where there is no suggestion that the material is about to become available to the public. Eady J and Tugendhat J have since further elaborated the significance of the principle in successive judgments in CTB v News Group Newspapers Ltd [2011] EWHC 1326 (QB) and 1334 (QB). In CTB, as in the present case, an interim injunction had been granted to restrain disclosure of information about an alleged sexual relationship. In CTB the claimant was a well known footballer who was married and had a family. In the five or so weeks after the injunction was granted, substantial information, from sources which could not be attributed to the defendant, became available on Twitter and the internet generally identifying or pointing towards the footballer. The defendants argued in effect that privacy injunctions (and no doubt other forms of injunction also) had ceased to serve any useful purpose in an age when information could be put out on various networks within or outside this jurisdiction by persons other than the immediate defendant. More specifically, the defendants in CTB also placed reliance on Eady Js refusal of an injunction to Mr Max Mosley in Mosley v News Group Newspapers Ltd [2008] EWHC 687 (QB). Eady J had there said that: The court should guard against slipping into playing the role of King Canute. Even though an order may be desirable for the protection of privacy, and may be made in accordance with the principles currently being applied by the courts, there may come a point where it would simply serve no useful purpose and would merely be characterised, in the traditional terminology, as a brutum fulmen. It is inappropriate for the court to make vain gestures. In CTB Eady J explained why this statement did not cover the circumstances in CTB: 18. The circumstances here are rather different. In Mosley, I took the view that there was no point in granting an injunction because, even before the application was made, several hundred thousand people had seen the intimate video footage which NGN had put on line conduct that was recently characterised by the ECtHR as a flagrant and unjustified intrusion: Mosley v UK (Application No 48009/08), 10 May 2011 at 104. In a real sense, therefore, it could be said that there was nothing left for the court to protect by an injunction. 19. Here, the Internet allegations prayed in aid by Mr Spearman took place after the order was made. Different policy considerations come into play when the court is invited to abandon the protection it has given a litigant on the basis of widespread attempts to render it ineffective. Furthermore, unlike the Mosley case, there is no doubt other information that Ms Thomas could yet publish, quite apart from this claimants identity, which is not yet in the public domain. The injunction thus continues to serve a useful purpose, from the claimants point of view, for that reason alone, since she is amenable to the jurisdiction of the court. Otherwise, he would not seek to maintain it. 20. Mr Spearmans application is therefore quite narrow. He seeks only to vary the injunction so as to permit the claimant to be identified. In the circumstances, Eady J held that even identification should not be permitted. It will be apparent that the circumstances in CTB bore some relevant similarities to those of the present case. In particular, reliance was placed on internet disclosures subsequent to the original injunction in support of an application to set aside the injunction on the basis that it served no further useful protective purpose. This situation was distinguished in principle from that where an injunction is granted after substantial internet disclosure. The substantial internet disclosure which had occurred after the injunction was not regarded as justifying the lifting of the injunction. The injunction, enforceable against the defendant, was seen as continuing to serve a useful purpose. As to the general suggestion that injunctions really have no sensible place in an internet age, Eady J said: 23. It is important always to remember that the modern law of privacy is not concerned solely with information or secrets: it is also concerned importantly with intrusion. [That] also largely explains why it is the case that the truth or falsity of the allegations in question can often be irrelevant: see eg McKennitt v Ash [2008] QB 73 at 80 and 87. 24. It is fairly obvious that wall to wall excoriation in national newspapers, whether tabloid or broadsheet, is likely to be significantly more intrusive and distressing for those concerned than the availability of information on the Internet or in foreign journals to those, however many, who take the trouble to look it up. Moreover, with each exposure of personal information or allegations, whether by way of visual images or verbally, there is a new intrusion and occasion for distress or embarrassment. Mr Tomlinson argues accordingly that the dam has not burst. For so long as the court is in a position to prevent some of that intrusion and distress, depending upon the individual circumstances, it may be appropriate to maintain that degree of protection. The analogy with King Canute to some extent, therefore, breaks down. 25 It may be thought that the wish of NGN to publish more about this story, with a view to selling newspapers and perhaps achieving other commercial advantages, demonstrates that coverage has not yet reached saturation point. Had it done so, the story would no longer retain any interest. This factor tends, therefore, to confirm my impression that the court's attempts to protect the claimant and his family have not yet become wholly futile. 26. In these circumstances, it seems to me that the right question for me to ask, in the light of JIH v News Group Newspapers Ltd [2011] 2 All ER 324 and In re Guardian News and Media Ltd [2010] UKSC 1, is whether there is a solid reason why the claimants identity should be generally revealed in the national media, such as to outweigh the legitimate interests of himself and his family in maintaining anonymity. The answer is as yet in the negative. They would be engulfed in a cruel and destructive media frenzy. Sadly, that may become unavoidable in the society in which we now live but, for the moment, in so far as I am being asked to sanction it, I decline to do so. On the other side, , it has not been suggested that there is any legitimate public interest in publishing the story. The analysis in these passages is both relevant and indeed largely transposable to the circumstances of the present appeal. The same theme was developed by Tugendhat J in the second CTB judgment, which followed the naming in Parliament by an MP of the footballer: Tugendhat J said: It is obvious that if the purpose of this injunction were 3. to preserve a secret, it would have failed in its purpose. But in so far as its purpose is to prevent intrusion or harassment, it has not failed. The fact that tens of thousands of people have named the claimant on the internet confirms that the claimant and his family need protection from intrusion into their private and family life. The fact that a question has been asked in Parliament seems to me to increase, and not to diminish the strength of his case that he and his family need that protection. The order has not protected the claimant and his family from taunting on the internet. It is still effective to protect them from taunting and other intrusion and harassment in the print media. Tugendhat Js reasoning in JIH and Eady Js reasoning in CTB were cited with approval by MacDonald J in H v A (No 2) [2015] EWHC 2630 (Fam), para 47. In so far as it is likely that the respondents in the present case would wish to accompany any stories with pictures of the relevant individuals, it is also consistent with the Leveson Inquiry Reports conclusion (para 3.4) that: There is a qualitative difference between photographs being available online and being displayed, or blazoned, on the front page of a newspaper such as the Sun. The fact of publication in a mass circulation newspaper multiplies and magnifies the intrusion, not simply because more people will be viewing the images, but also because more people will be talking about them. Thus, the fact of publication inflates the apparent newsworthiness of the photographs by placing them more firmly within the public domain and at the top of the news agenda. It is right that the Supreme Court should on the present application express its own view on the correctness of the approach taken in the authorities discussed in the preceding paragraphs (paras 26 32). In my opinion, the approach is sound in general principle. Every case must be considered on its particular facts. But the starting point is that (i) there is not, without more, any public interest in a legal sense in the disclosure or publication of purely private sexual encounters, even though they involve adultery or more than one person at the same time, (ii) any such disclosure or publication will on the face of it constitute the tort of invasion of privacy, (iii) repetition of such a disclosure or publication on further occasions is capable of constituting a further tort of invasion of privacy, even in relation to persons to whom disclosure or publication was previously made especially if it occurs in a different medium (see paras 34 37 below). However, whether an interim injunction should be granted to restrain an anticipated tortious invasion of privacy raises different considerations from those involved in the simple question whether disclosure or publication would constitute a tortious act. The courts have to apply HRA section 12, and, before restraining publication prior to trial, have in particular to be satisfied that the applicant is likely to establish that publication should not be allowed. They have, under section 12(4), to have particular regard to the importance of the article 10 right to freedom of expression, although, as already explained (paras 19 20 above), that right has no necessary claim to priority over the need to have due regard to any article 8 privacy right which the applicant for an injunction enjoys. Where, as here, the proceedings relate to journalistic material (or conduct connected to such material) the courts must also have particular regard under section 12(4)(a) to two specific factors which point potentially in different directions: (i) (ii) the extent to which the material has, or is about to, become available to the public and the extent to which it is, or would be, in the public interest for the material to be published. Under section 12(4)(b), the courts must also have particular regard to any relevant privacy code. As to the factor identified in section 12(4)(a)(ii), for reasons already given (paras 21 24 above), the present appeal must be approached, on the evidence presently available, on the basis that there is and would be effectively no public interest in a legal sense in further disclosure or publication. As to the factor in section 12(4)(a)(i), the requirement to have particular regard to the extent to which journalistic material (or conduct connected with such material) has, or is about to, become available to the public does not preclude a court, when deciding whether to grant or lift injunctive relief, from having regard to both the nature of the journalistic material involved and the medium in a) which it is, or is to be, expressed, and b) the extent to which it is already available in that medium and the extent to which steps are being or can be taken to remove or limit access to any other publication in that or any other medium. In short, the question whether material has, or is about to, become available to the public should be considered with reference to, inter alia, the medium and form in relation to which injunctive relief is sought. In the light of the above, I consider that the Court of Appeal focused too narrowly on the disclosures already made on the internet, and did not give due weight to the qualitative difference in intrusiveness and distress likely to be involved in what is now proposed by way of unrestricted publication by the English media in hard copy as well as on their own internet sites. There is little doubt that there would be a media storm. It would involve not merely disclosure of names and generalised description of the nature of the sexual activities involved, but the most intimate details. This would be likely to add greatly and on a potentially enduring basis to the intrusiveness and distress felt by the appellant, his partner and, by way of increased media attention now and/or in the future, their children. The Court of Appeal did not do justice to this qualitative difference either when it said that the wall to wall excoriation which the claimant fears has already been taking place for the last two weeks in the English press, as a result of numerous headlines such as celebrity love cheat and Gag couple alleged to have had a threesome (para 47(ii), or when it went on to refer to the likely impact of the proposed publication as a further unwelcome intrusion, increasing what is being suffered already, not a shock revelation, as publication in January would have been (para 47(iii)). As to section 12(4)(b), this is of particular relevance in relation to the appellants and his partners children. The respondents subscribe to the Independent Press Standards Organisation (IPSO), whose Editors Code of Practice of January 2016 provides that Everyone is entitled to respect for his or her private and family life and that editors will be expected to justify intrusions into any individuals private life without consent (clause 3(i) and (ii)). The Code notes that there can be exceptions in the public interest, emphasising however that editors must demonstrate an exceptional public interest to over ride the normally paramount interests of [children under 16]). The last point echoes the thinking in article 3(1) of the United Nations Convention on the Rights of the Child (providing that In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration) which has in turn informed the ECtHRs and United Kingdom courts understanding of ECHR article 8: see eg ZH (Tanzania) v Secretary of State for the Home Department [2011] 2 AC 166, H v Lord Advocate 2012 SC (UKSC) 308, H (H) v Deputy Prosecutor of the Italian Republic (Genoa) [2013] 1 AC 338 and Zoumbas v Secretary of State for the Home Department [2013] 1 WLR 3690. Mr Browne submits that the interests of the appellants children were not given the primacy or importance which they deserved. The Court of Appeal in granting injunctive relief in January 2016 identified as relevant consequences of the proposed article both that the children would become the subject of increased press attention, with all that that entails and that, even if they do not suffer harassment in the short term, they are [ie if the proposed article is published] bound to learn about these matters from school friends and the internet in due course. The Court of Appeal in deciding to discharge the injunction in April 2016 addressed only the latter consequence, saying that it was now a less material consideration as whether or not the court grants an injunction, it is inevitable that the two children will in due course learn about these matters. The Court of Appeal did not expressly advert to the short term risks involved in media attention and communication of the information to young children, and still less did it advert to the qualitative difference between, on the one hand, unrestricted exposure in the hard copy media as well as on internet sites and, on the other hand, internet exposure which the appellant and those advising him have made and intend to continue to make every effort to restrict, so far as lies within their power. I prefer simply to agree with what Lady Hale says in this area in the open part of her judgment, without finding it necessary to refer to or rely on what is said in the redacted part. (iv) An effective remedy Mr Browne makes a fourth criticism of the Court of Appeals approach to the exercise of its discretion. The Court, having concluded that the appellant was likely at trial to establish that publication was a tortious invasion of privacy, nonetheless left the appellant to a claim for damages. It is therefore a criticism of the Court of Appeals exercise of the discretion which, as Lord Nicholls recognised in Cream Holdings, exists under HRA section 12 once a court has decided that a proposed publication is likely to be tortious and goes on to consider whether the applicant is also likely to establish at trial that publication should not be allowed. By exercising its discretion so as to discharge the injunction, Mr Browne submits, the Court of Appeal failed to ensure that the appellants privacy rights were practical and effective: Von Hannover v Germany, para 40, Armonien v Lithuania, para 38. The submission must, however, be approached with caution at a European level, because in Mosley v United Kingdom [2012] 2012] EMLR 1, para 120, the ECtHR (when considering whether the Convention required the media, before publishing potentially private material, to inform the subject of such material) observed that in its examination to date of the measures in place at domestic level to protect article 8 rights in the context of freedom of expression, it has implicitly accepted that ex post facto damages provide an adequate remedy for violations of article 8 rights arising from the publication by a newspaper of private information. The ECtHR went on to explain Armonien v Lithuania as a case where damages had not provided an adequate remedy, because of the derisory sum that had been awarded. On the other hand, in Mosley v United Kingdom the ECtHR was primarily engaged in delimiting the scope of ECHR rights, particularly with regard to pre notification, at a European level. It was not excluding the possibility of or justification for a prior restraint on publication in appropriate cases at a domestic level. Indeed, it upheld such a prior restraint in Editions Plon v France (2006) 42 EHRR 36. Further, it said this in Mosley (para 117): 117. Finally, the Court has emphasised that while article 10 does not prohibit the imposition of prior restraints on publication, the dangers inherent in prior restraints are such that they call for the most careful scrutiny on the part of the Court. This is especially so as far as the press is concerned, for news is a perishable commodity and to delay its publication, even for a short period, may well deprive it of all its value and interest (see Observer and Guardian v United Kingdom (26 November 1991, (1992) 14 EHRR 153, para 60). The Court would, however, observe that prior restraints may be more readily justified in cases which demonstrate no pressing need for immediate publication and in which there is no obvious contribution to a debate of general public interest. In the present case, it can be said that there is no urgency about any publication, as well as no evident contribution to any debate of general public interest. At a domestic level, the Court of Appeal has itself also recognised that the refusal of an interlocutory injunction can operate as a strong potential disincentive to respect for aspects of private life and that, depending on the circumstances, it may only be by the grant of such an injunction that privacy rights can be satisfactorily protected: Douglas v Hello! Ltd (No 3) [2006] QB 125, paras 257 and 259; and that such an injunction may be the only remedy which is of any value: A v B plc [2003] QB 195, para 11. Damage done by publication of a defamatory statement can be redressed by a public finding at trial that the allegation was false, but an invasion of privacy cannot be cured in a similar way, and for that reason there may never be a trial, whatever damages might be recoverable. These points are also recognised in the academic writing: see eg Freedom of Speech (OUP, 2006), by Professor Eric Barendt, p 137 and Privacy and Press Freedom (Blackstone 1995), by Professor Raymond Wacks, p 156. Mr Browne further notes, with reference to the first instance decision of Mosley v News Group Newspapers [2008] EMLR 20, that it has been held at first instance that exemplary or punitive damages are not recoverable at common law for misuse of private information. On the other hand, the contrary remains open to argument at higher levels, and whether an account of profits might be claimed is likewise open. (In future, there may be a statutory possibility of obtaining an award of exemplary damages against a publisher not a member of an approved regulator; that is under sections 34 36 of the Crime and Courts Act 2013, if a court were to be satisfied that the respondents conduct has shown a deliberate or reckless disregard of an outrageous nature for the claimants rights, that the conduct is such that the court should punish the defendant for it and that other remedies would not be adequate to punish that conduct. But no approved regulator at present exists, so that the section has no application to the present case.) In any event, whether or not substantial or even exemplary damages could be recovered in the present case is not decisive of the question whether an interim injunction should be granted. Once again, it is necessary to consider the particular facts. Here, it is highly likely, having regard to the nature of the material sought to be published and the identity and financial circumstances of the appellant, that the appellants real concern is indeed with the invasion of privacy that would be involved in further disclosure and publication in the English media, and that any award of damages, however assessed, would be an inadequate remedy. Conclusions The circumstances of this case present the Supreme Court with a difficult choice. As in the Court of Appeal, so before the Supreme Court the case falls to be approached on the basis that the appellant is likely at trial to establish that the proposed disclosure and publication is likely to involve further tortious invasion of privacy rights of the appellant and his partner as well as of their children, who have of course no conceivable involvement in the conduct in question. The invasion would, on present evidence, be clear, serious and injurious. On the other hand, those interested in a prurient story can, if they try, probably read about the identities of those involved and in some cases about the detail of the conduct, according to where they may find it on the internet. The Court will be criticised for giving undue protection to a tawdry story by continuing the injunction to trial. There is undoubtedly also some risk of further internet, social media or other activity aimed at making the Courts injunction seem vain, whether or not encouraged in any way by any persons prevented from publishing themselves. On the other hand, the legal position, which the Court is obliged to respect, is clear. There is on present evidence no public interest in any legal sense in the story, however much the respondents may hope that one may emerge on further investigation and/or in evidence at trial, and it would involve significant additional intrusion into the privacy of the appellant, his partner and their children. At the end of the day, the only consideration militating in favour of discharging the injunction is the incongruity of the parallel and in probability significantly uncontrollable world of the internet and social media, which may make further inroads into the protection intended by the injunction. Against that, however, the media storm which discharge of the injunction would unleash would add a different and in some respects more enduring dimension to the existing invasions of privacy being perpetrated on the internet. At the risk of appearing irredentist, the Supreme Court has come to the conclusion that, on a trial in the light of the present evidence, a permanent injunction would be likely to be granted in the interests of the appellant, his partner and especially their children. The appeal should therefore be allowed, and the Court will order the continuation of the interim injunction to trial or further order accordingly. LORD NEUBERGER: (with whom Lady Hale, Lord Mance and Lord Reed agree) The issue which we have to decide is whether to uphold or reverse the decision of the Court of Appeal to lift an interlocutory injunction which it had previously granted at the suit of PJS, who is married to YMA, and they have two young children. That interlocutory injunction restrained NGN until trial or further order from publishing a story about a sexual relationship between PJS and AB and another, a story which had been communicated to News Group Newspapers Ltd, NGN, by AB. I agree that we should reverse the decision and continue, or re impose, the interlocutory injunction, for the reasons given in the judgment of Lord Mance, and I also agree with Lady Hale. Because we are reversing the Court of Appeal and are not unanimous in doing so, I add a few words of my own. The history in summary After NGN had obtained the story from AB, they very properly informed PJS of their intention to publish it in the Sun on Sunday newspaper. PJSs case was and remains that this would be unlawful as it would violate his legal rights as it would be an unlawful misuse of his private information. Accordingly, he immediately issued proceedings against NGN seeking a permanent injunction to prevent such publication. Because a permanent injunction can only be granted after a trial, NGN would have been able to publish the story in the meantime. Accordingly, PJS also immediately applied for a temporary, or interlocutory, injunction to restrain NGN from publishing the story until the trial. NGN resisted both the proceedings and the grant of the interlocutory injunction on the ground that the public interest in freedom of expression and in the story being published outweighed any privacy rights enjoyed by PJS. Cranston J decided that NGN were right and refused PJS an interlocutory injunction (but granted one very temporarily to enable PJS to appeal). PJS appealed to the Court of Appeal which on 22 January 2016, granted an interlocutory injunction for reasons given by Jackson LJ. In summary, he considered that PJS had a legally recognised expectation of privacy, that there was no public interest in the story being published, that PJS therefore had a strong case that publication of the story would infringe his legal rights, that such publication would be devastating for PJS, that there would be increased press attention paid to his children, and that when this action comes to trial, [PJS] is likely to establish that publication should not be allowed [2016] EWCA Civ 100. Thereafter, the story was published in a newspaper in the United States, in Canada and in Scotland, and it has been available to the public in England and Wales to the extent described by Lord Mance in paras 6 8 above. As a result, NGN applied to the Court of Appeal to lift the interlocutory injunction on the ground that the dissemination of the story since January 2016 meant that the information was now out in the public domain to such an extent that a permanent injunction would not be granted at trial, so that the interlocutory injunction should therefore be discharged. On 18 April 2016, the Court of Appeal, for reasons given by Jackson LJ, accepted that argument and discharged the interlocutory injunction [2016] EWCA Civ 393. The Court of Appeal nonetheless stayed the discharge of the injunction for two days to enable PJS to apply to this Court. We decided to hear PJSs application for permission to appeal to this Court together with the arguments which the parties wished to raise on any appeal, and to continue the stay until we had determined the application and any appeal. Can this Court consider whether to continue the interlocutory injunction? On the face of it, a decision whether or not to discharge an interlocutory injunction is a matter for the court which determines that issue. However, an appellate court can interfere with such a decision if the determining court proceeds on an erroneous basis. In this case, there are three possible reasons why this Court is, as a matter of law, entitled to reconsider the issue raised on this appeal for ourselves. First, although he gave an impressive and careful judgment, Jackson LJ misdirected himself in an important respect when reaching the decision to discharge the interlocutory injunction which had been previously granted. Having rightly said that it was necessary to balance PJSs right to respect for his private and family life against NGNs right to freedom of his expression, he said that section 12 of the Human Rights Act enhances the weight to be given to the latter factor. However, that is not right. As Lord Steyn made clear in In re S (A Child) [2005] 1 AC 593, para 17, each right has equal potential force in principle, and the question is which way the balance falls in the light of the specific facts and considerations in a particular case. This was an error which entitles, indeed obliges, us to reconsider the question of discharging the interlocutory injunction. Secondly, there is an argument that it was wrong to proceed on the basis that the story had what Jackson LJ described as limited, as opposed to no, public interest. Of course, there is always a public interest in anyone particularly, some may think, the media having the right to say what they want. As Jackson LJ rightly said in his first judgment in this case at para 55, [freedom of expression is an important right for its own sake; and that is recognised by section 12(4) of the Human Rights Act 1998, which provides that [t]he court must have particular regard to the importance of the Convention right to freedom of expression. However, following section 12(4)(a)(ii) of the 1998 Act, it appears to me that it was the public interest (as opposed to the interests of some members of the public) in the story being published which Jackson LJ was describing. In his earlier judgment in which he decided to grant the injunction, Jackson LJ decided that there was no public interest in the story being published (see [2016] EWCA Civ 100, para 53), and, as that finding has unsurprisingly not been appealed, it must be accepted, at least until trial. Having said that, I very much doubt that this factor would have been enough to persuade me that we could reconsider the question of continuing the interlocutory injunction, but, in the light of what I say in para 51 above and para 53 below, that is an academic point. Thirdly, it appears to me that the Court of Appeal overlooked, or at any rate gave insufficient weight to, the intrusive and distressing effect on PJS and his family of newspaper coverage of the story, to some extent conflating that question with confidentiality. I will say more about that aspect in the next section of this judgment. The continuation of the interlocutory injunction It is therefore for this Court to decide whether or not to re impose the interlocutory injunction, it appears to me that the central issue in that connection is whether the trial judge would be likely to grant a permanent injunction when this case comes to trial. Section 12(3) of the 1998 Act precludes the grant of an interlocutory injunction unless a permanent injunction is likely to be granted at trial; on the other side of things, it is hard to see why, in this case at least, an interlocutory injunction should not be granted (and, a fortiori, continued) if a permanent injunction is likely to be granted. In this context, the proper approach to likelihood is as set out by Lord Nicholls in Cream Holdings Ltd v Banerjee [2005] 1 AC 253, para 22, which is set out by Lord Mance in para 19 above. In January 2016, the Court of Appeal thought it was likely that, at the end of the trial of this action, a judge would grant a permanent injunction restraining NGN from publishing the story. Accordingly, the question to be resolved is whether, despite the publicity which has already been given to the story, as described by Lord Mance in paras 6, 7 and 8 of his judgment, that is still the likely outcome at trial. On that centrally relevant issue, it must be remembered that this is an application to discharge an interlocutory judgment before the trial of the action concerned. NGNs case must therefore be that the interlocutory injunction should be revoked because of some significant change of circumstances since it was granted in January 2016 Thevarajah v Riordan [2016] 1 WLR 76 para 18 citing Buckley LJ in Chanel Ltd v F W Woolworth & Co Ltd [1985] 1 WLR 485, 492 493. Accordingly, with the exception of the effects of the subsequent publicity referred to in para 55 above, the conclusions reached in the first judgment of the Court of Appeal must be assumed to be correct; in particular, it must be assumed that there is no public interest in publication of the story, and that, were it not for the publicity which has occurred since January 2016, it is likely that a permanent injunction would be granted. If PJSs case was simply based on confidentiality (or secrecy), then, while I would not characterise his claim for a permanent injunction as hopeless, it would have substantial difficulties. The publication of the story in newspapers in the United States, Canada, and even in Scotland would not, I think, be sufficient of itself to undermine the claim for a permanent injunction on the ground of privacy. However, the consequential publication of the story on websites, in tweets and other forms of social network, coupled with consequential oral communications, has clearly resulted in many people in England and Wales knowing at least some details of the story, including the identity of PJS, and many others knowing how to get access to the story. There are claims that between 20% and 25% of the population know who PJS is, which, it is fair to say, suggests that at least 75% of the population do not know the identity of PJS, and presumably more than 75% do not know much if anything about the details of the story. However, there comes a point where it is simply unrealistic for a court to stop a story being published in a national newspaper on the ground of confidentiality, and, on the current state of the evidence, I would, I think, accept that, if one was solely concerned with confidentiality, that point had indeed been passed in this case. However, claims based on respect for privacy and family life do not depend on confidentiality (or secrecy) alone. As Tugendhat J said in Goodwin v News Group Newspapers Ltd [2011] EMLR 502, para 85, [t]he right to respect for private life embraces more than one concept. He went on to cite with approval a passage written by Dr Moreham in Law of Privacy and the Media (2nd ed (2011), edited by Warby, Moreham and Christie), in which she summarised the two core components of the rights to privacy as unwanted access to private information and unwanted access to [or intrusion into] ones personal space what Tugendhat J characterised as confidentiality and intrusion. Tugendhat J then went on to identify a number of cases where intrusion had been relied on by judges to justify the grant of an injunction despite a significant loss of confidentiality, namely Blair v Associated Newspapers Ltd (10 March 2000, Morland J), West v BBC (10 June 2002, Ouseley J), McKennitt v Ash [2006] EMLR 178, para 81 (Eady J), X & Y v Persons Unknown [2007] EMLR 290, para 64 (Eady J), JIH v News Group Newspapers Ltd [2011] EMLR 177, paras 58 59 (Tugendhat J), TSE v News Group Newspapers Ltd [2011] EWHC 1308 (QB), paras 29 30 (Tugendhat J) and CTB v News Group Newspapers Ltd [2011] EWHC 1326 (QB), para 23 (Eady J), to which can be added CTB v News Group Newspapers Ltd [2011] EWHC 1334 (QB), para 3 (Tugendhat J), Rocknroll v News Group Newspapers Ltd [2013] EWHC 24 (Ch), para 25 (Briggs J), and H v A (No 2) [2015] EWHC 2630 (Fam), paras 66 69 (MacDonald J). Perusal of those decisions establishes that there is a clear, principled and consistent approach at first instance when it comes to balancing the medias freedom of expression and an individuals rights in respect of confidentiality and intrusion. There has been not even a hint of disapproval of that approach by the Court of Appeal (although it considered appeals in McKennitt [2008] QB 73 and JIH [2011] 1 WLR 1645). Indeed, unsurprisingly, there has been no argument that we should take the opportunity to overrule or depart from them. Accordingly, it seems to me that it is appropriate for this Court to adhere to the approach in those cases. Not only do they demonstrate a clear and consistent approach, but they are decisions of judges who are highly respected, and, at least in the main, highly experienced in the field of media law and practice; and they were mostly decided at a time when access to the internet was easily available to the great majority of people in the United Kingdom. The significance of intrusion, as opposed to confidentiality, in these decisions was well explained in the judgment of Eady J in CTB [2011] EWHC 1326 (QB), where he refused an application by a newspaper to vary an interlocutory injunction because of what he referred to as widespread coverage on the Internet. At para 24 he said that [i]t is fairly obvious that wall to wall excoriation in national newspapers is likely to be significantly more intrusive and distressing for those concerned than the availability of information on the Internet or in foreign journals to those, however many, who take the trouble to look it up. As he went on to say in the next paragraph of his judgment, in a case such as this, [f]or so long as the court is in a position to prevent some of that intrusion and distress, depending upon the individual circumstances, it may be appropriate to maintain that degree of protection. The same approach was taken by Tugendhat J in a later judgment in the same case, CTB [2011] EWHC 1334 (QB), when refusing a further application to lift the interlocutory injunction after the applicants name had been mentioned in the House of Commons. At para 3, having accepted that it was obvious that if the purpose of this injunction were to preserve a secret, it would have failed in its purpose, he said that in so far as its purpose is to prevent intrusion or harassment, it has not failed. Indeed, he regarded the fact that tens of thousands of people have named the claimant on the internet as confirming, rather than undermining, the argument that the claimant and his family need protection from intrusion into their private and family life. It also seems to me that if there was no injunction in this case, there would be greater intrusion on the lives of PJS and YMA through the internet. There may well be room for different views as to whether the lifting of the injunction would lead to an increase or a decrease in tweets and other electronic communications relating to the story. However, if the identity of PJS and the story could be communicated within England and Wales, then it would be likely that anyone in this jurisdiction who was searching for PJS (or indeed YMA) through a search engine, for reasons wholly unconnected with the story, would find prominent links to that story. But if search engines serving England and Wales are geo blocked from mentioning PJS, or indeed YMA, in connection with the story, as they should be so long as an injunction is in place, this would not happen. It might be said that PJS and YMA could ask the search engine operators to remove any links to the story pursuant to the decision of the Court of Justice in Google Spain SL v Agencia Espaola de Proteccin de Datos (Case C 131/12) [2014] QB 1022, but it seems unlikely that the reasoning in that case could apply to a story which has only recently become public and is being currently covered in the newspapers. In the instant case, Jackson LJ said in his first judgment, when granting the interlocutory injunction, that [t]he proposed article would generate a media storm and much public interest in [PJSs] family. There would be increased press interest in [his] and YMAs family life. The children would become the subject of increased press attention, with all that that entails. There is no reason to think that that would be significantly different now, despite the internet coverage of the story and indeed it may be that the press interest and attention identified by Jackson LJ in that passage would be increased as a result of the internet coverage. In my view, the case for lifting the interlocutory injunction imposed in January 2016 has not been made out. The publication of the story and the identification of PJS in the electronic media since January 2016 has undoubtedly severely undermined (and probably, but not necessarily, demolished) PJSs claim for an injunction in so far as he relies on confidentiality. However, I am unconvinced, on the basis of the evidence and arguments we have heard, that it has substantially reduced the strength of his claim in so far as it rests on intrusion. Bearing in mind those factors and the lack of public interest in the story being published, as well as the factors mentioned by Lord Mance and Lady Hale, I consider that the interlocutory injunction should be continued until trial (or further order in the meantime). One argument for discharging the injunction which I have not so far mentioned is that it may be arguable that things have got to the stage where it would be less damaging to PJS for the story to be published in the Sun on Sunday and other newspapers and got out of the way in one go, with all the intrusion that that would entail, as opposed to the potential drip feeding of the story on the internet coupled with oblique references in the print media, often coupled with indignation at being unable to report the story. It is very hard indeed to assess the strength of that argument at least on the basis of the evidence which we were taken to. Further, it is a point which was scarcely, if at all, relied on by NGN, and it is a point on which the view and experience of PJS and his family should, I would have thought, carry some weight. Accordingly, I am not persuaded that it should carry the day for NGN at least at this stage. Concluding remarks I would therefore grant PJS permission to appeal to this Court, set aside the decision of the Court of Appeal given on 18 April 2016, and continue the injunction granted on 22 January 2016, until trial or further order in the meantime. In summary terms this is because it seems likely that PJS will establish at trial that (i) publication of the story in the Sun on Sunday would be an unlawful breach of his rights, and (ii) he should be entitled to an injunction to restrain it, because of the consequential intrusion into his and his familys private lives. It is one thing for what should be private information to be unlawfully disseminated; it is quite another for that information to be recorded in eye catching headlines and sensational terms in a national newspaper, or to be freely available on search engines in this jurisdiction to anyone searching for PJS or YMA, or indeed AB, by name in a different connection. If, as seems to me likely on the present state of the evidence and the current state of the law, PJS will succeed in obtaining such an injunction at trial, then it follows that he ought to be granted an injunction to restrain publication of the story in the meantime. I referred in para 66 above to the indignation of the newspapers. It is easy to understand, and indeed to sympathise with, the concern of NGN and other newspapers at being excluded from reporting in this jurisdiction a story which is available, at least in part, to people in this country via electronic media. I appreciate that it is scant consolation, but the fact is that this situation arises from the perception that a story in a newspaper has greater influence, credibility and reach, as well greater potential for intrusion, than the same story on the internet. I also accept that, as many commentators have said, that the internet and other electronic developments are likely to change our perceptions of privacy as well as other matters and may already be doing so. The courts must of course be ready to consider changing their approach when it is clear that that approach has become unrealistic in practical terms or out of touch with the standards of contemporary society. However, we should not change our approach before it is reasonably clear that things have relevantly changed in a significant and long term way. In that connection, while internet access became freely available in this country only relatively recently, almost all the cases listed at the end of para 59 above were decided since that happened, and many of those cases were decided after blogging and tweeting had become common. It is therefore quite understandable that Mr Millar QC, for NGN did not suggest that the law as laid down in those cases was wrong or outdated; and, currently at least, I am unpersuaded that they do not represent the law. In the light of the facts as they currently appear and the law as it has now been developed, it appears to me that the interlocutory injunction sought by PJS should be granted. The courts exist to protect legal rights, even when their protection is difficult or unpopular in some quarters. And if Parliament takes the view that the courts have not adapted the law to fit current realities, then, of course, it can change the law, for instance by amending section 12 of the 1998 Act. LADY HALE: (with whom Lord Neuberger, Lord Mance and Lord Reed agree) I agree that this appeal should be allowed and the interim injunction restored for the reasons given by Lord Mance. I wish only to add a few words about the interests of the two children whom PJS has with YMA. It is simply not good enough to dismiss the interests of any children who are likely to be affected by the publication of private information about their parents with the bland statement that these cannot be a trump card. Of course they cannot always rule the day. But they deserve closer attention than they have so far received in this case, for two main reasons. First, not only are the childrens interests likely to be affected by a breach of the privacy interests of their parents, but the children have independent privacy interests of their own. They also have a right to respect for their family life with their parents. Secondly, by section 12(4)(b), any court considering whether to grant either an interim or a permanent injunction has to have particular regard to any relevant privacy code. It is not disputed that the IPSO Code, which came into force in January, is a relevant Code for this purpose. This, as Lord Mance has explained, provides that editors must demonstrate an exceptional public interest to over ride the normally paramount interests of [children under 16]. This means that, at trial, the court will have to consider carefully the nature and extent of the likely harm to the childrens interests which will result in the short, medium and longer terms from the publication of this information about one of their parents. At present, there is no evidence about this. It is possible that, at trial, the evidence will not support any risk of harm to the childrens interests from publication of the story in the English print and broadcasting media. It is possible that the evidence will indicate that the children can be protected from any such risk, by a combination of the efforts of their parents, teachers and others who look after them and some voluntary restraint on the part of the media. On the other hand, it is also possible that the evidence will support a risk of harm to the childrens interests from the invasion of their own and their parents privacy, a risk from which it will be extremely difficult to protect them. There is all the difference in the world between the sort of wall to wall publicity and intrusion which is likely to meet the lifting of this injunction and their learning this information in due course, which the Court of Appeal thought inevitable. For one thing, the least harmful way for these children to learn of these events is from their parents. Their parents have the resources to take wise professional advice about how to reveal and explain matters to their children in an age appropriate way and at the age appropriate time. No doubt their parents are already giving careful thought to whether this might be the best way of protecting their children, especially from the spike of interest which is bound to result from this judgment let alone from any future judgment. The particular features which are relevant to the balancing exercise in this case are contained in three short paragraphs in the unredacted version of this judgment. These unfortunately have to be redacted because it would be comparatively easy to surmise the identity of the children and their parents from them. There are particular reasons why care should be taken about how, when and why these children should learn the truth. [redacted] [redacted] [redacted] In the leading case of In re S (A Child) (Identification: Restrictions on Publication) [2005] 1 AC 593, very careful consideration was given, at first instance, in the Court of Appeal and in the House of Lords, to balancing the public interest in publishing the name of a woman accused of murdering her child against the welfare interests of her surviving child who was living with his father. The public interest, in the legal sense, of publication was very strong. There was expert evidence of the welfare interests of the surviving child. It could not be more different from this case. As Lord Mance has demonstrated, there is no public interest in the legal sense in the publication of this information. There is no expert evidence of the interests of these children. These are all matters which should be properly argued at trial, not pre empted by premature disclosure. LORD TOULSON: (dissenting) I respectfully disagree with the judgment of the majority. Despite the arguments persuasively advanced by Mr Desmond Browne QC on behalf of PJS, I have concluded on reflection that the injunction originally granted by the Court of Appeal on 22 January 2016 should not be reinstated. That injunction provided that NGN (as I will refer to the respondent) should not publish any information which might lead to PJSs identification, or any of the information referred to in a confidential schedule to the order, until trial of the action or further order. To Lord Mances full summary of the facts I would add only that there have been numerous twitter hashtags of a fairly obvious kind leading to material identifying PJS in connection with the injunction. I agree with Lord Mance that it was incorrect for the Court of Appeal to say, as it did, that section 12 of the Human Rights Act (HRA) enhances the weight which article 10 rights carry in the balancing exercise with the article 8 rights of PJS. In its judgment dated 22 January 2016 the Court of Appeal set out correctly the interplay between articles 8 and 10 (at para 30 and following), and I doubt whether the court really intended to adopt a different approach in April, but that is not a sufficient basis to re interpret, or overlook as immaterial, what it said on the later occasion. In consequence, this court must review for itself the question whether the January injunction should be set aside because of a change of circumstances. Although it does not affect the need for this court to form its own judgment whether the January injunction should be set aside, I would not subscribe to Lord Mances other three criticisms of the Court of Appeal; that it wrongly referred to limited public interest; that it applied a quantitive test to the level of disclosure which there had been, thereby overlooking the invasiveness and distress which the proposed publication would entail; and that its decision involved a failure to ensure that PJSs privacy rights were practical and effective. As to public interest, the Court of Appeal referred to what it had said on that subject in its earlier judgment without repeating it. In its earlier judgment the court made it clear that it thought very little of the public interest argument, for reasons which it fully explained. The seven reasons which the court gave in the judgment under review, at para 47, for setting aside the injunction were in no way affected by the NGNs suggested public interest in the publication; they were all to do with the consequences of what had become public. As to applying a purely quantitive test, section 12(4) of the HRA required the court to have regard to the extent to which the information embargoed from publication by the injunction was available to the public; the court also considered expressly the impact on PJS and the children of further disclosure in the light of events which had happened. The final criticism, relating to a practical and effective remedy, requires fuller discussion. It is not disputed that this court must approach the question whether the injunction should remain in place on the basis that, on the present information, PJS is likely to succeed at the trial in his claim that publication of his identity, and the other information in the confidential schedule to the injunction, would be a breach of his article 8 rights. The Court of Appeal so found in its January judgment, and it adhered to that view in the judgment under review (para 41). Mr Gavin Millar QC did not try to persuade the court otherwise, although he made it clear that the Sun intends to maintain its public interest defence at the trial. For present purposes, the court must proceed on the basis that there is no public interest in the publication of the material, however interesting it might be to some members of the public. The fact that there is a public appetite, which the proposed publication would feed, for information about the sex lives of celebrities does not mean that its disclosure would be in the public interest. Celebrities are entitled to the same respect for their private lives as anyone else, unless disclosure would genuinely support the function of the press as a public watchdog. All this is well established. The provision in section 12(3) of the HRA that there should be no pre trial restraint on publication unless the court is satisfied that the applicant is likely to establish that publication should not be allowed requires more than that the applicant is likely to establish that publication would be in breach of his rights. It is generally necessary to persuade the court that he is likely to obtain a final injunction at the trial. The Court of Appeal rightly identified this as the crucial question (para 46). On that issue I have reached the same conclusion as the Court of Appeal for essentially the same reasons. Mr Browne concentrated his argument on the impact on PJS and his spouse becoming the subjects of a media storm, together with the consequences for their children. The Court of Appeal rightly recognised that the information which the NGN wants to publish is still private in the sense that it concerns intimate sexual matters, which attract the protection of article 8, although much of the confidentiality has been lost. In the world in which PJS lives, knowledge of the story must be commonplace and it is apparent from the evidence that the circle of those who know is much wider. The story in its essential details has been published in a major Scottish newspaper, it has been widely accessible on websites and twitter, and anyone who seriously wanted to know PJSs identity will have had ways of finding it. Confidentiality in a meaningful sense can survive a certain amount of leakage, and every case must be decided on its own facts, but in this case I have reached a clear view that the storys confidentiality has become so porous that the idea of it still remaining secret in a meaningful sense is illusory. Once it has become readily available to anyone who wants to know it, it has lost the essence of confidentiality. The court must live in the world as it is and not as it would like it to be. I would echo Jackson LJs words that [i]t is in my view inappropriate (some may use a stronger term) to ban people from saying that which is common knowledge. In my judgment that is good sense and good law. Mr Browne submitted that even if the story has become widely known, an injunction is still appropriate to protect PJS from the impact of its being reported in the media in a lurid fashion. The Court of Appeal weighed the media storm argument both in its January judgment and in its recent judgment. In the later judgment it saw less force in the point than in January. It said that the process of excoriation which PJS fears has already been occurring and will inevitably continue. It did not go as far as to accept the NGNs argument that PJSs article 8 rights had ceased to be engaged at all, because it recognised that the proposed publication would be a further intrusion, but the critical factor in the courts decision whether to continue the injunction, as I read its judgment, was what it saw as the unreality of trying to put a lid on the story. It is well recognised that repeated publication of private (and especially intimate) photos may properly be prevented by injunction, because the original publication does not necessarily reduce the intrusion caused by re publication. In Douglas v Hello! Ltd (No 3) [2006] QB 125, para 105, the Court of Appeal explained that insofar as a photograph does more than convey information, and intrudes on privacy by enabling the viewer to focus on intimate personal detail, there will be a fresh intrusion of privacy when each additional viewer sees the photograph, or even when one who has seen a previous publication of the photograph is confronted by a fresh publication of it. The court gave the example of a photograph taken with a telescopic lens of a film star lying naked by a swimming pool. In the present case what is sought to be restrained is the publication of facts of which there has already been widespread disclosure. Once facts are widely known, the legal landscape changes. In my view the court needs to be very cautious about granting an injunction preventing publication of what is widely known, if it is not to lose public respect for the law by giving the appearance of being out of touch with reality. Lord Mance says at para 33 that the requirement under section 12(4)(a)(i) of the HRA for the court to pay particular regard to the extent to which the material has, or is about to, become available to the public must be considered with reference to the form in relation to which injunctive relief is to be sought. As I read the words of the Act, they require the court to take into account how generally available the information has become from whatever source, be it broadcast journalism, print journalism, the internet or social media. The evident underlying purpose of the subsection is to discourage the granting of an injunction to prevent publication of information which is already widely known. If the information is in wide, general circulation from whatever source or combination of sources, I do not see that it should make a significant difference whether the medium of the intended publication is the internet, print journalism or broadcast journalism. The world of public information is interactive and indivisible. I do not underestimate the acute unpleasantness for PJS of the story being splashed, but I doubt very much in the long run whether it will be more enduring than the unpleasantness of what has been happening and will inevitably continue to happen. The story is not going to go away, injunction or no injunction. It is a fact of life that stories about celebrities sometimes acquire their own momentum. In relation to the children, the Court of Appeal took account of their position both in its January judgment and in its recent judgment. They are very young and there are various steps which their parents can take to shield them from the immediate publicity. As the Court of Appeal said, it is inevitable in the longer term that the children will learn about these matters and their parents have no doubt already considered how they propose to handle it. The case of Editions Plon v France, to which Lord Mance has referred, arose from the publication shortly after the death of President Mitterand of a book by his doctor entitled Le Grand Secret. The French court granted an application by the late presidents widow and children for an interlocutory injunction to stop its distribution. The doctor was subsequently prosecuted, fined and given a suspended prison sentence. Final judgment in the civil proceedings was given nine months after the presidents death. Substantial damages were awarded to his widow and children and the injunction was made permanent. The Strasbourg court held that the temporary injunction had been legitimate, because the publication had occurred so soon after the presidents death when his family were grieving. It did not consider that the permanent injunction satisfied the requirement of serving a pressing social need, particularly having regard to the other remedies which had been ordered and to the fact that the story was widely available on the internet. I recognise that the facts were very different from those of the present case, and that the content of the book raised matters of undoubted public interest, but the case nevertheless shows that the court took a significantly different approach to a permanent ban on the publication of information which was widely available on the internet from its approach to a temporary ban for a specific and limited purpose. Lord Mance has said that the effect of lifting the injunction will be largely to undermine the purpose of any trial, which will be rendered irrelevant. I would make two observations. First, while adequacy of damages as a remedy is a reason to refuse an injunction, you cannot turn the argument on its head and say that inadequacy of damages is a positive reason to grant an otherwise inappropriate injunction. Secondly, I do not agree that the trial will be rendered irrelevant. As to damages, I would not regard Eady Js decision in Mosley v News Group Newspapers Ltd [2008] EWHC 1777 (QB), [2008] EMLR 20, that exemplary damages cannot be awarded in an appropriate case for breach of privacy, as the final word on the subject. Proportionality is essential, but I would not rule out the possibility of the courts considering such an award to be necessary and proportionate in order to deter flagrant breaches of privacy and provide adequate protection for the person concerned. I would dismiss the appeal.

PJS is married to YMA. Both are well known individuals in the entertainment business. They have two young children. Between 2009 and 2011 PJS had a sexual relationship with AB and, on one occasion, with AB and CD. In January 2016 the editor of the Sun on Sunday newspaper, published by News Group Newspapers (NGN), notified PJS that he proposed to publish ABs account of the relationship. PJS issued proceedings claiming that the publication would breach his rights to privacy and confidentiality, protected by article 8 of the European Convention on Human Rights (ECHR). He applied for an interim injunction, to restrain publication pending the trial of his claim. This application required the court to balance PJSs article 8 rights with NGNs right to freedom of expression under article 10 ECHR, and was subject to s 12 of the Human Rights Act 1998 (HRA). Section 12(3) provides that an interim injunction can only be granted if a claimant is likely to establish at trial that publication should not be allowed. Section 12(4) provides that the court must have particular regard to the importance of freedom of expression and, in relation to journalistic material, to the extent to which the material has or is about to become available to the public, to the public interest in the material being published, as well as to any relevant privacy code. The High Court refused the application but the Court of Appeal allowed PJSs appeal on 22 January 2016 and granted an interim injunction which restrained publication of information which would disclose the identity of PJS and details of the sexual relationship. On 6 April 2016 ABs account was published in print in the United States, and thereafter in Canada and in Scotland, identifying PJS. As a result of representations by the appellants solicitors, publication was restricted to hardcopy editions and online publication was geo blocked such that internet users in England and Wales could not readily access those sites. However, details have been published on a number of other websites and social media, although the appellants solicitors have been doing their best to remove offending URLs and web pages. On 12 April 2016 NGN applied to the Court of Appeal to set aside the interim injunction on the ground that, as the information was now in the public domain, PJS was unlikely to obtain a permanent injunction at trial and the interim injunction could therefore no longer be justified. On 18 April 2016 the Court of Appeal held that the injunction should be discharged. The Supreme Court restored it pending determination of PJSs application for permission to appeal, which it ordered to be heard with the appeal, should permission be granted. The Supreme Court unanimously grants permission to appeal; and allows PJSs appeal by a majority of 4 to 1. Lord Mance gives the leading judgment, with which Lord Neuberger and Lady Hale (each of whom give supporting judgments) and Lord Reed agree. Lord Toulson gives a dissenting judgment. As the Court of Appeal erred in law, the Supreme Court grants permission to appeal and must decide for itself whether the interim injunction should be discharged or maintained [19]. The principal error is that the Court of Appeal wrongly directed itself that s 12 HRA enhanced the weight to be given to article 10 rights in the balancing exercise, when the case law establishes that neither article 8 nor article 10 has preference over the other and what is necessary is an intense focus on the comparative rights being claimed in the individual case [20][51]. The Court of Appeal also referred to a limited public interest in the story when it had rightly held that there was none in its earlier judgment [21]. There is not, on its own, any public interest in the legal sense in the disclosure of private sexual encounters even if they involve infidelity or more than one person at the same time, however famous the individual(s) involved [24][32]. It is essential to distinguish between the claims for breach of privacy and for breach of confidence. The widespread availability of the information in the public domain may well mean that PJS would face difficulties in obtaining a permanent injunction in so far as his claim is based on confidentiality [57], but different considerations apply to privacy claims, where the impact of any additional disclosure on the likely distress to PJS and his family, and the degree of intrusion or harassment, continues to be highly relevant. The question is whether the injunction can still serve a useful purpose. It is important to consider the medium and form of the previous publication: there is a qualitative difference in intrusiveness and distress between the disclosures on the internet which have occurred and the media storm which would follow from publication by the English media in hard copy, together with unrestricted internet coverage of the story [35][63]. Publication in this form is contrary to the interests of PJSs children and in breach of the requirement to show an exceptional public interest for the intrusion set out in the Editors Code of Practice to which NGN has subscribed [36]. Lady Hales judgment discusses this consideration further, partly in redacted form to prevent identification [72 78] Rights must be practical and effective. The grant of an injunction is the only remedy of any value to PJS and his family, for whom the invasion of privacy occasioned by further disclosure in the English media, rather than any award of damages, is likely to be the real concern [43]. The central issue is whether the trial judge is likely to grant a permanent injunction. Balancing all these factors, the majority concludes that PJS is likely to establish at trial that the proposed publication by NGN constitutes a serious breach of his and his familys privacy rights, with no countervailing public interest on the present evidence, and that he is likely to be granted a permanent injunction notwithstanding the internet and social media publication. Accordingly, the interim injunction is maintained [44 45][68]. Lord Toulson, dissenting, would have upheld the discharge of the injunction. He considers that where the information is widely available, the form of the publication should not make a significant difference: the purpose of s 12(3) is to discourage the granting of an injunction to prevent publication of information which is already widely known [89].

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This case concerns the framework which will govern an application for the grant of development consent for the construction of a third runway at Heathrow Airport. This is a development scheme promoted by the appellant, Heathrow Airport Ltd (HAL), the owner of the airport. As a result of consideration over a long period, successive governments have come to the conclusion that there is a need for increased airport capacity in the South East of England to foster the development of the national economy. An independent commission called the Airports Commission was established in 2012 under the chairmanship of Sir Howard Davies to consider the options. In its interim report dated 17 December 2013 the Airports Commission reached the conclusion that there was a clear case for building one new runway in the South East, to come into operation by 2030. In that report the Airports Commission set out scenarios, including a carbon traded scenario under which overall carbon dioxide (CO) emissions were set at a cap consistent with a goal to limit global warming to 2C. The Commission reduced the field of proposals to three main candidates. Two of these involved building additional runway capacity at Heathrow Airport, either to the north west of the existing two runways (the NWR Scheme) or by extending the existing northern runway (the ENR Scheme). The third involved building a second runway at Gatwick airport (the G2R Scheme). The Airports Commission carried out an extensive consultation on which scheme should be chosen. In its final report dated 1 July 2015 (the Airports Commission Final Report) the Commission confirmed that there was a need for additional runway capacity in the South East by 2030 and concluded that, while all three options could be regarded as credible, the NWR Scheme was the best way to meet that need, if combined with a significant package of measures which addressed environmental and community impacts. The Government carried out reviews of the Airports Commissions analysis and conclusions. It assessed the Airports Commission Final Report to be sound and robust. On 14 December 2015 the Secretary of State for Transport (the Secretary of State) announced that the Government accepted the case for airport expansion; agreed with, and would consider further, the Airports Commissions short list of options; and would use the mechanism of a national policy statement (NPS) issued under the Planning Act 2008 (the PA 2008) to establish the policy framework within which to consider an application by a developer for a development consent order (DCO). The announcement also stated that further work had to be done in relation to environmental impacts, including those arising from carbon emissions. In parallel with the development of national airports policy, national and international policy to combat climate change has also been in a state of development. The Climate Change Act 2008 (the CCA 2008) was enacted on the same day as the PA 2008. It sets a national carbon target (section 1) and requires the Government to establish carbon budgets for the UK (section 4). There are mechanisms in the CCA 2008 to adjust the national target and carbon budgets (in sections 2 and 5, respectively) as circumstances change, including as scientific understanding of global warming develops. In 1992, the United Nations adopted the United Nations Framework Convention on Climate Change. 197 states are now parties to the Convention. Following the 21st Conference of the parties to the Convention, on 12 December 2015 the text of the Paris Agreement on climate change was agreed and adopted. The Paris Agreement set out certain obligations to reduce emissions of greenhouse gases, in particular CO2, with the object of seeking to reduce the rate of increase in global warming and to contain such increase to well below 2oC above, and if possible to 1.5oC, above pre industrial levels. On 22 April 2016 the United Kingdom signed the Paris Agreement and on 17 November 2016 the United Kingdom ratified the Agreement. An expansion of airport capacity in the South East would involve a substantial increase in CO2 emissions from the increased number of flights which would take place as a result. The proposals for such expansion have therefore given rise to a considerable degree of concern as to the environmental impact it would be likely to have on global warming and climate change. This is one aspect of the proposals for expansion of airport capacity, among many others, which have made the decision whether to proceed with such expansion a matter of controversy. On 25 October 2016, the Secretary of State announced that the NWR Scheme was the Governments preferred option. In February 2017 the Government commenced consultation on a draft of an Airports NPS which it proposed should be promulgated pursuant to the PA 2008 to provide the national policy framework for consideration of an application for a DCO in respect of the NWR Scheme. A further round of consultation on a draft of this NPS was launched in October 2017. There were many thousands of responses to both consultations. In June 2018 the Government published its response to the consultations. It also published a response to a report on the proposed scheme dated 1 November 2017 by the Transport Committee (a Select Committee of the House of Commons). On 5 June 2018 the Secretary of State laid before Parliament the final version of the Airports NPS (the ANPS), together with supporting documents. As is common ground on this appeal, the policy framework set out in the ANPS makes it clear that issues regarding the compatibility of the building of a third runway at Heathrow with the UKs obligations to contain carbon emissions and emissions of other greenhouse gases could and should be addressed at the stage of the assessment of an application by HAL for a DCO to allow it to proceed with the development. As is also common ground, the ANPS makes it clear that the emissions obligations to be taken into account at the DCO stage will be those which are applicable at that time, assessed in the light of circumstances and the detailed proposals of HAL at that time. On 25 June 2018 there was a debate on the proposed ANPS in the House of Commons, followed by a vote approving the ANPS by 415 votes to 119, a majority of 296 with support from across the House. On 26 June 2018 the Secretary of State designated the ANPS under section 5(1) of the PA 2008 as national policy. It is the Secretary of States decision to designate the ANPS which is the subject of legal challenge in these proceedings. Objectors to the NWR Scheme commenced a number of claims against the Secretary of State to challenge the lawfulness of the designation of the ANPS on a wide variety of grounds. For the most part, those claims have been dismissed in the courts below in two judgments of the Divisional Court (Hickinbottom LJ and Holgate J) in the present proceedings, [2019] EWHC 1070 (Admin); [2020] PTSR 240, and an associated action ([2019] EWHC 1069 (Admin)) and in the judgment of the Court of Appeal in the present proceedings: [2020] EWCA Civ 214; [2020] PTSR 1446. The Divisional Court dismissed all the claims brought by objectors, including those brought by the respondents to this appeal (Friends of the Earth FoE and Plan B Earth). FoE is a non governmental organisation concerned with climate change. Plan B Earth is a charity concerned with climate change. However, the Court of Appeal allowed appeals by FoE and Plan B Earth and granted declaratory relief stating that the ANPS is of no legal effect and that the Secretary of State had acted unlawfully in failing to take into account the Paris Agreement in making his decision to designate the ANPS. The Court of Appeal set out four grounds for its decision: (i) The Secretary of State breached his duty under section 5(8) of the PA 2008 to give an explanation of how the policy set out in the ANPS took account of Government policy, which was committed to implementing the emissions reductions targets in the Paris Agreement (the section 5(8) ground); (ii) The Secretary of State breached his duty under section 10 of the PA 2008, when promulgating the ANPS, to have regard to the desirability of mitigating and adapting to climate change, in that he failed to have proper regard to the Paris Agreement (the section 10 ground); (iii) The Secretary of State breached his duty under article 5 of the Strategic Environmental Assessment Directive (the SEA Directive, Directive 2001/42/EC of the European Parliament and of the Council on the assessment of the effects of certain plans and programmes on the environment) to issue a suitable environmental report for the purposes of public consultation on the proposed ANPS, in that he failed to refer to the Paris Agreement (the SEA Directive ground); and (iv) The Secretary of State breached his duty under section 10 of the PA 2008, when promulgating the ANPS, in that he failed to have proper regard to (a) the desirability of mitigating climate change in the period after 2050 (the post 2050 ground) and (b) the desirability of mitigating climate change by restricting emissions of non CO impacts of aviation, in particular nitrous oxide (the non CO2 emissions ground). The Court of Appeal also rejected a submission by HAL, relying on section 31 of the Senior Courts Act 1981, that it should exercise its discretion as to remedy to refuse any relief, on the grounds that (HAL argued) it was highly likely that even if there had been no breach of duty by the Secretary of State the decision whether to issue the ANPS would have been the same. HAL appeals to this court with permission granted by the court. HAL is joined in the proceedings as an interested party. It has already invested large sums of money in promoting the NWR Scheme and wishes to carry it through by applying for a DCO in due course and then building the proposed new runway. The Secretary of State has chosen not to appeal and has made no submissions to us. However, HAL is entitled to advance all the legal arguments which may be available in order to defend the validity of the ANPS. Prior to the Covid 19 pandemic, Heathrow was the busiest two runway airport in the world. The pandemic has had a major impact in reducing aviation and the demand for flights. However, there will be a lead time of many years before any third runway at Heathrow is completed and HALs expectation is that the surplus of demand for aviation services over airport capacity will have been restored before a third runway would be operational. Lord Anderson QC for HAL informed the court that HAL intends to proceed with the NWR Scheme despite the pandemic. The Planning Act 2008 We are grateful to the Divisional Court for their careful account of the PA 2008, on which we draw for this section. The PA 2008 established a new unified development consent procedure for nationally significant infrastructure projects defined to include certain airport related development including the construction or alteration of an airport that is expected to be capable of providing air passenger services for at least 10m passengers per year (sections 14 and 23). Originally, many of the primary functions under the Act were to be exercised by the Infrastructure Planning Commission, established under section 1. However, those functions were transferred to the Secretary of State by the Localism Act 2011. The mischiefs that the Act was intended to address were identified in the White Paper published in May 2007, Planning for a Sustainable Future (Cm 7120) (the 2007 White Paper). Prior to the PA 2008, a proposal for the construction of a new airport or extension to an airport would have required planning permission under the Town and Country Planning Act 1990. An application for permission would undoubtedly have resulted in a public inquiry, whether as an appeal against refusal of consent or a decision by the Secretary of State to call in the matter for his own determination. As paragraph 3.1 of the 2007 White Paper said: A key problem with the current system of planning for major infrastructure is that national policy and, in particular, the national need for infrastructure, is not in all cases clearly set out. This can cause significant delays at the public inquiry stage, because national policy has to be clarified and the need for the infrastructure has to be established through the inquiry process and for each individual application. For instance, the absence of a clear policy framework for airports development was identified by the inquiry secretary in his report on the planning inquiry as one of the key factors in the very long process for securing planning approval for Heathrow Terminal 5. Considerable time had to be taken at the inquiry debating whether there was a need for additional capacity. The Government has since responded by publishing the Air Transport White Paper to provide a framework for airport development. This identifies airport development which the Government considers to be in the national interest, for reference at future planning inquiries. But for many other infrastructure sectors, national policy is still not explicitly set out, or is still in the process of being developed. Paragraph 3.2 identified a number of particular problems caused by the absence of a clear national policy framework. For example, inspectors at public inquiries might be required to make assumptions about national policy and national need, often without clear guidance and on the basis of incomplete evidence. Decisions by Ministers in individual cases might become the means by which government policy would be expressed, rather than such decisions being framed by clear policy objectives beforehand. In the absence of a clear forum for consultation at the national level, it could be more difficult for the public and other interested parties to have their say in the formulation of national policy on infrastructure. The ability of developers to make long term investment decisions is influenced by the availability of clear statements of government policy and objectives, and might be adversely affected by the absence of such statements. The 2007 White Paper proposed that national policy statements would set the policy framework for decisions on the development of national infrastructure. They would integrate the Governments objectives for infrastructure capacity and development with its wider economic, environmental and social policy objectives, including climate change goals and targets, in order to deliver sustainable development. The role of Ministers would be to set policy, in particular the national need for infrastructure development (para 3.4). Paragraph 3.11 envisaged that any public inquiry dealing with individual applications for development consent would not have to consider issues such as whether there is a case for infrastructure development, or the types of development most likely to meet the need for additional capacity, since such matters would already have been addressed in the NPS. It was said that NPSs should have more weight than other statements of policy, whether at a national or local level: they should be the primary consideration in the determination of an application for a DCO (para 3.12), although other relevant considerations should also be taken into account (para 3.13). To provide democratic accountability, it was said that NPSs should be subject to Parliamentary scrutiny before being adopted (para 3.27). In line with the 2007 White Paper recommendation, Part 2 of the PA 2008 provides for NPSs which give a policy framework within which any application for development consent, in the form of a DCO, is to be determined. Section 5(1) gives the Secretary of State the power to designate an NPS for development falling within the scope of the Act; and section 6(1) provides that [t]he Secretary of State must review each [NPS] whenever the Secretary of State thinks it appropriate to do so. The content of an NPS is governed by section 5(5) (8) which provide that: set out the relative weight to be given to specified (5) The policy set out in [an NPS] may in particular (a) set out, in relation to a specified description of development, the amount, type or size of development of that description which is appropriate nationally or for a specified area; (b) set out criteria to be applied in deciding whether a location is suitable (or potentially suitable) for a specified description of development; (c) criteria; (d) identify one or more locations as suitable (or potentially suitable) or unsuitable for a specified description of development; (e) identify one or more statutory undertakers as appropriate persons to carry out a specified description of development; (f) set out circumstances in which it is appropriate for a specified type of action to be taken to mitigate the impact of a specified description of development. [An NPS] must give reasons for the policy set out in the (6) If [an NPS] sets out policy in relation to a particular description of development, the statement must set out criteria to be taken into account in the design of that description of development. (7) statement. (8) The reasons must (in particular) include an explanation of how the policy set out in the statement takes account of Government policy relating to the mitigation of, and adaptation to, climate change. As is made clear, the NPS may (but is not required to) identify a particular location for the relevant development. provides (so far as relevant to these claims): In addition, under the heading Sustainable development, section 10 (1) This section applies to the Secretary of States functions under sections 5 and 6. (2) The Secretary of State must, in exercising those functions, do so with the objective of contributing to the achievement of sustainable development. (3) For the purposes of subsection (2) the Secretary of State must (in particular) have regard to the desirability of (a) mitigating, and adapting to, climate change; The process for designation of an NPS is also set out in the Act. The PA 2008 imposed for the first time a transparent procedure for the public and other consultees to be involved in the formulation of national infrastructure policy in advance of any consideration of an application for a DCO. The Secretary of State produces a draft NPS, which is subject to (i) an appraisal of sustainability (AoS) (section 5(3)), (ii) public consultation and publicity (section 7), and (iii) Parliamentary scrutiny (sections 5(4) and 9). In addition, there is a requirement to carry out a strategic environmental assessment under the SEA Directive as transposed by the Environmental Assessment of Plans and Programmes Regulations 2004 (SI 2004/1633) (the SEA Regulations) (see regulation 5(2) of the SEA Regulations). The consultation and publicity requirements are set out in section 7, which so far as relevant provides: (1) This section sets out the consultation and publicity requirements referred to in sections 5(4) and 6(7). (2) The Secretary of State must carry out such consultation, and arrange for such publicity, as the Secretary of State thinks appropriate in relation to the proposal. This is subject to subsections (4) and (5). (3) In this section the proposal means (a) the statement that the Secretary of State proposes to designate as [an NPS] for the purposes of this Act or (b) (as the case may be) the proposed amendment. (4) The Secretary of State must consult such persons, and such descriptions of persons, as may be prescribed. (5) If the policy set out in the proposal identifies one or more locations as suitable (or potentially suitable) for a specified description of development, the Secretary of State must ensure that appropriate steps are taken to publicise the proposal. (6) The Secretary of State must have regard to the responses to the consultation and publicity in deciding whether to proceed with the proposal. A proposed NPS must be laid before Parliament (section 9(2) and (8)). The Act thus provides an opportunity for a committee of either House of Parliament to scrutinise a proposed NPS and to make recommendations; and for each House to scrutinise it and make resolutions (see section 9(4)). An NPS is not the end of the process. It simply sets the policy framework within which any application for a DCO must be determined. Section 31 provides that, even where a relevant NPS has been designated, development consent under the PA 2008 is required for development to the extent that the development is or forms part of a nationally significant infrastructure project. Such applications must be made to the relevant Secretary of State (section 37). Chapter 2 of Part 5 of the Act makes provision for a pre application procedure. This provides for a duty to consult pre application, which extends to consulting relevant local authorities and, where the land to be developed is in London, the Greater London Authority (section 42). There are also duties to consult the local community, and to publicise and to take account of responses to consultation and publicity (sections 47 49; and see also regulation 12 of the Infrastructure Planning (Environmental Impact Assessment) Regulations 2017 (SI 2017/572), which makes provision for publication of and consultation on preliminary environmental information). Any application for a DCO must be accompanied by a consultation report (section 37(3)(c)); and adequacy of consultation is one of the criteria for acceptance of the application (section 55(3) and (4)(a)). Part 6 of the PA 2008 is concerned with Deciding applications for orders granting development consent. Once the application has been accepted, section 56 requires the applicant to notify prescribed bodies and authorities and those interested in the land to which the application relates, who become interested parties to the application (section 102). The notification must include a notice that interested parties may make representations to the Secretary of State. Section 60(2) provides that where a DCO application is accepted for examination there is a requirement to notify any local authority for the area in which land, to which the application relates, is located (see section 56A)) and, where the land to be developed is in London, the Greater London Authority, inviting them each to submit a local impact report (section 60(2)). The Secretary of State may appoint a panel or a single person to examine the application (the Examining Authority) and to make a report setting out its findings and conclusions, and a recommendation as to the decision to be made on the application. The examination process lasts six months, unless extended (section 98); and the examination timetable is set out in the Infrastructure Planning (Examination Procedure) Rules 2010 (SI 2010/103) (the Examination Rules). In addition to local impact reports (section 60), the examination process involves written representations (section 90), written questions by the Examining Authority (rules 8 and 10 of the Examination Rules), and hearings (which might be open floor and/or issue specific and/or relating to compulsory purchase) (sections 91 93). As a result of the examination process, the provisions of the proposed DCO may be amended by either the applicant or the Examination Authority, eg in response to the representations of interested parties; and it is open to the Secretary of State to modify the proposed DCO before making it. Section 104 constrains the Secretary of State when determining an application for a DCO for development in relation to which an NPS has effect, in the following terms (so far as relevant to these claims): (2) In deciding the application the Secretary of State must have regard to (a) any [NPS] which has effect in relation to development of the description to which the application relates (a relevant [NPS]), any local impact report , (b) (c) any matters prescribed in relation to development of the description to which the application relates, and (d) any other matters which the Secretary of State thinks are both important and relevant to the Secretary of States decision. (3) The Secretary of State must decide the application in accordance with any relevant [NPS], except to the extent that one or more of subsections (4) to (8) applies. (4) This subsection applies if the Secretary of State is satisfied that deciding the application in accordance with any relevant [NPS] would lead to the United Kingdom being in breach of any of its international obligations. (5) This subsection applies if the Secretary of State is satisfied that deciding the application in accordance with any relevant [NPS] would lead to the Secretary of State being in breach of any duty imposed on the Secretary of State by or under any enactment. (6) This subsection applies if the Secretary of State is satisfied that deciding the application in accordance with any relevant [NPS] would be unlawful by virtue of any enactment. (7) This subsection applies if the Secretary of State is satisfied that the adverse impact of the proposed development would outweigh its benefits. (8) This subsection applies if the Secretary of State is satisfied that any condition prescribed for deciding an application otherwise than in accordance with [an NPS] is met. (9) For the avoidance of doubt, the fact that any relevant [NPS] identifies a location as suitable (or potentially suitable) for a particular description of development does not prevent one or more of subsections (4) to (8) from applying. (1) In deciding an application for an order granting development consent, the Secretary of State may disregard representations if the Secretary of State considers that the representations (a) (b) NPS]. In this section representation includes evidence. relate to the merits of policy set out in [an (2) Section 104 is complemented by section 106 which, under the heading Matters which may be disregarded when determining an application, provides (so far as relevant to these claims): That is also reflected in sections 87(3) and 94(8), under which the Examining Authority may disregard representations (including evidence) or refuse to allow representations to be made at a hearing if it considers that they relate to the merits of the policy set out in [an NPS] . By section 120(1), a DCO may impose requirements in connection with the development for which consent is granted, eg it may impose conditions considered appropriate or necessary to mitigate or control the environmental effects of the development. Section 120(3) is a broad provision enabling a DCO to make provision relating to, or to matters ancillary to, the development for which consent is granted including any of the matters listed in Part 1 of Schedule 5 (section 120(4)). That schedule lists a wide range of potentially applicable provisions, including compulsory purchase, the creation of new rights over land, the carrying out of civil engineering works, the designation of highways, the operation of transport systems, the charging of tolls, fares and other charges and the making of byelaws and their enforcement. Section 13 concerns Legal challenges relating to [NPSs]. Section 13(1) provides: A court may entertain proceedings for questioning [an NPS] or anything done, or omitted to be done, by the Secretary of State in the course of preparing such a statement only if the proceedings are brought by a claim for (a) judicial review, and (b) the claim form is filed before the end of the period of six weeks beginning with the day after (i) the day on which the statement is designated as [an NPS] for the purposes of this Act, or (ii) published. (if later) the day on which the statement is It was under section 13 that the claims by objectors to the ANPS were brought. The Climate Change Act 2008 Again, we gratefully draw on the account given by the Divisional Court. As they explain, the UK has for a long time appreciated the desirability of tackling climate change, and wished to take a more rigorous domestic line. In the 2003 White Paper, Our Energy Future Creating a Low Carbon Economy, the Government committed to reduce CO2 emissions by 60% on 1990 levels by 2050; and to achieve real progress by 2020 (which equated to reductions of 26 32%). The 60% figure emanated from the EU Council of Ministers Community Strategy on Climate Change in 1996, which determined to limit emissions to 550 parts per million (ppm) on the basis that to do so would restrict the rise in global temperatures to 2C above pre industrial levels which, it was then considered, would avoid the serious consequences of global warming. However, by 2005, there was scientific evidence that restricting emissions to 550ppm would be unlikely to be effective in keeping the rise to 2C; and only stabilising CO2 emissions at something below 450ppm would be likely to achieve that result. Parliament addressed these issues in the CCA 2008. Section 32 established a Committee on Climate Change (the CCC), an independent public body to advise the UK and devolved Governments and Parliaments on tackling climate change, including on matters relating to the UKs statutory carbon reduction target for 2050 and the treatment of greenhouse gases from international aviation. Section 1 gives a mandatory target for the reduction of UK carbon emissions. At the time of designation of the ANPS, it provided: It is the duty of the Secretary of State [then, the Secretary of State for Energy and Climate Change: now, the Secretary of State for Business, Enterprise and Industrial Strategy (BEIS)] to ensure that the net UK carbon account for the year 2050 is at least 80% lower than the 1990 baseline. The figure of 80% was substituted for 60% during the passage of the Bill, as evolving scientific knowledge suggested that the lower figure would not be sufficient to keep the rise in temperature to 2C in 2050. Therefore, although the CCA 2008 makes no mention of that temperature target, as the CCC said in its report on the Paris Agreement issued in October 2016 (see para 73 below): This 2050 target was derived as a contribution to a global emissions path aimed at keeping global average temperatures to around 2C above pre industrial levels. The statutory target of a reduction in carbon emissions by 80% by 2050 was Parliaments response to the international commitment to keep the global temperature rise to 2C above pre industrial levels in 2050. Since the designation of the ANPS, the statutory target has been made more stringent. The figure of 100% was substituted for 80% in section 1 of the CCA 2008 by the Climate Change Act 2008 (2050 Target Amendment) Order 2019/1056. The Secretary of State for BEIS has the power to amend that percentage (section 2(1) of the CCA 2008), but only: (i) if it appears to him that there have been significant developments in scientific knowledge about climate change since the passing of the Act, or developments in European or international law or policy (section 2(2) and (3)): the Explanatory Note to the Act says, as must be the case, that this power might be used in the event of a new international treaty on climate change; (ii) after obtaining, and taking into account, advice from the CCC (section 3(1)); and (iii) subject to Parliamentary affirmative resolution procedure (section 2(6)). Section 1 of the CCA 2008 sets a target that relates to carbon only. Section 24 enables the Secretary of State for BEIS to set targets for other greenhouse gases, but subject to similar conditions to which an amendment to the section 1 target is subject. In addition to the carbon emissions target set by section 1 and to ensure compliance with it (see sections 5(1)(b) and 8) the Secretary of State for BEIS is also required to set for each succeeding period of five years, at least 12 years in advance, an amount for the net UK carbon account (the carbon budget); and ensure that the net UK carbon account for any period does not exceed that budget (section 4). The carbon budget for the period including 2020 was set to be at least 34% lower than the 1990 baseline. Section 10(2) sets out various matters which are required to be taken into account when the Secretary of State for BEIS sets, or the CCC advises upon, any carbon budget, including: (a) scientific knowledge about climate change; (b) technology relevant to climate change; (c) economic circumstances, and in particular the likely impact of the decision on the economy and the competitiveness of particular sectors of the economy; (d) fiscal circumstances, and in particular the likely impact of the decision on taxation, public spending and public borrowing; (e) of the decision on fuel poverty; (f) (h) (i) international aviation and international shipping circumstances at European and international level; the estimated amount of reportable emissions from social circumstances, and in particular the likely impact Therefore, although for the purposes of the CCA 2008 emissions from greenhouse gases from international aviation do not generally count as emissions from UK sources (section 30(1)), by virtue of section 10(2)(i), in relation to any carbon budget, the Secretary of State for BEIS and the CCC must take such emissions into account. The evidence for the Secretary of State explains that the CCC has interpreted that as requiring the UK to meet a 2050 target which includes these emissions. The CCC has advised that, to meet the 2050 target on that basis, emissions from UK aviation (domestic and international) in 2050 should be no higher than 2005 levels, ie 37.5 megatons (million tonnes) of CO2 (MtCO2). This is referred to by the respondents as the Aviation Target. However, the Aviation Policy Framework issued by the Government in March 2013 explains that the Government decided not to take a decision on whether to include international aviation emissions in its carbon budgets, simply leaving sufficient headroom in those budgets consistent with meeting the 2050 target including such emissions, but otherwise deferring a decision for consideration as part of the emerging Aviation Strategy. The Aviation Strategy is due to re examine how the aviation sector can best contribute its fair share to emissions reductions at both the UK and global level. It is yet to be finalised. The SEA Directive Again, in this section we gratefully draw on the careful account given by the Divisional Court. As they explain, Directive 2011/92/EU of the European Parliament and of the Council of 13 December 2011 on the assessment of the effects of certain public and private projects on the environment as amended (the EIA Directive), as currently transposed by the Town and Country Planning (Environmental Impact Assessment) Regulations 2017 (SI 2017/571), requires a process within normal planning procedures. (For the purposes of these claims, the transposing regulations have not materially changed over the relevant period; and we will refer to them collectively as the EIA Regulations.) The SEA Directive as transposed by the SEA Regulations concerns the environmental impact of plans and programmes. The SEA Directive and Regulations applied to the ANPS. The EIA Directive would apply when there was a particular development for which development consent was sought, at the DCO stage. Recital (1) to the SEA Directive states: Article 174 of the Treaty provides that Community policy on the environment is to contribute to, inter alia, the preservation, protection and improvement of the quality of the environment, the protection of human health and the prudent and rational utilisation of natural resources and that it is to be based on the precautionary principle. Article 6 of the Treaty provides that environmental protection requirements are to be integrated into the definition of Community policies and activities, in particular with a view to promoting sustainable development. As suggested here, the SEA Directive relies upon the precautionary principle where appropriate. Recital (4) states: Environmental assessment is an important tool for integrating environmental considerations into the preparation and adoption of certain plans and programmes which are likely to have significant effects on the environment in the member states, because it ensures that such effects of implementing plans and programmes are taken into account during their preparation and before their adoption. Recital (9) states: This Directive is of a procedural nature, and its requirements should either be integrated into existing procedures in member states or incorporated in specifically established procedures. With a view to avoiding duplication of the assessment, member states should take account, where appropriate, of the fact that assessments will be carried out at different levels of a hierarchy of plans and programmes. Thus, the requirements of the SEA Directive are essentially procedural in nature; and it may be appropriate to avoid duplicating assessment work by having regard to work carried out at other levels or stages of a policy making process (see article 5(2) (3) below). Recital (17) states: The environmental report and the opinions expressed by the relevant authorities and the public, as well as the results of any transboundary consultation, should be taken into account during the preparation of the plan or programme and before its adoption or submission to the legislative procedure. The objectives of the SEA Directive are set out in article 1: The objective of this Directive is to provide for a high level of protection of the environment and to contribute to the integration of environmental considerations into the preparation and adoption of plans and programmes with a view to promoting sustainable development, by ensuring that, in accordance with this Directive, an environmental assessment is carried out of certain plans and programmes which are likely to have significant effects on the environment. Article 3(1) requires an environmental assessment to be carried out, in accordance with articles 4 to 9, for plans and programmes referred to in article 3(2) (4) which are likely to have significant environmental effects. Article 3(2) requires strategic environmental assessment generally for any plan or programme which is prepared for (inter alia) transport, town and country planning or land use and which sets the framework for future development consent for projects listed in Annexes I and II to the EIA Directive. Strategic environmental assessment is also required for other plans and programmes which are likely to have significant environmental effects (article 3(4)). By virtue of sections 104 and 106 of the PA 2008, the ANPS designated under section 5 sets out the framework for decisions on whether a DCO for the development of an additional runway at Heathrow under Part 6 of that Act should be granted. That development would, in due course, require environmental impact assessment under the EIA Directive and Regulations; and there is no dispute that the ANPS needed to be subjected to strategic environmental assessment under the SEA Directive and the SEA Regulations. Article 2(b) of the SEA Directive defines environmental assessment for the purposes of the Directive: environmental assessment shall mean the preparation of an environmental report, the carrying out of consultations, the taking into account of the environmental report and the results of the consultations in decision making and the provision of information on the decision in accordance with articles 4 to 9. Article 4(1) requires environmental assessment to be carried out during the preparation of a plan or programme and before its adoption . , which in this instance would refer to the Secretary of States decision to designate the ANPS. Article 5 sets out requirements for an environmental report. By article 2(c): environmental report shall mean the part of the plan or programme documentation containing the information required in article 5 and Annex I. In the case of the ANPS the environmental report was essentially the AoS. Article 5(1) provides: Where an environmental assessment is required under article 3(1), an environmental report shall be prepared in which the likely significant effects on the environment of implementing the plan or programme, and reasonable alternatives taking into account the objectives and the geographical scope of the plan or programme, are identified, described and evaluated. The information to be given for this purpose is referred to in Annex I. Annex I states, under the heading, Information referred to in article 5(1): The information to be provided under article 5(1), subject to article 5(2) and (3), is the following: the environmental characteristics of areas likely (a) an outline of the contents, main objectives of the plan or programme and relationship with other relevant plans and programmes; (b) the relevant aspects of the current state of the environment and the likely evolution thereof without implementation of the plan or programme; (c) to be significantly affected; (d) any existing environmental problems which are relevant to the plan or programme including, in particular, those relating to any areas of a particular environmental importance, such as areas designated pursuant to [the Habitats and Birds Directives]; (e) the environmental protection objectives, established at international, Community or member state level, which are relevant to the plan or programme and the way those objectives and any environmental considerations have been taken into account during its preparation; (f) the likely significant effects on the environment, including on issues such as biodiversity, population, human health, fauna, flora, soil, water, air, climatic factors, material assets, cultural heritage including architectural and archaeological heritage, landscape and the interrelationship between the above factors; (g) the measures envisaged to prevent, reduce and as fully as possible offset any significant adverse effects on the environment of implementing the plan or programme; (h) an outline of the reasons for selecting the alternatives dealt with, and a description of how the assessment was undertaken including any difficulties (such as technical deficiencies or lack of know how) encountered in compiling the required information; (i) a description of the measures envisaged concerning monitoring in accordance with article 10; (j) a non technical summary of the information provided under the above headings. (2) The environmental report prepared pursuant to paragraph 1 shall include the information that may reasonably be required taking into account current knowledge and methods of assessment, the contents and level of detail in the plan or programme, its stage in the decision making process and the extent to which certain matters are more appropriately assessed at different levels in that process in order to avoid duplication of the assessment. (3) Relevant information available on environmental effects of the plans and programmes and obtained at other levels of decision making or through other Community legislation may be used for providing the information referred to in Annex I. (Emphasis added) Thus, the information required by the combination of article 5(1) and Annex I is subject to article 5(2) and (3), which provide: Accordingly, the information which is required to be included in an environmental report, whether by article 5(1) itself or by that provision in conjunction with Annex I, is qualified by article 5(2) and (3) in a number of respects. First, the obligation is only to include information that may reasonably be required, which connotes the making of a judgment by the plan making authority. Second, that judgment may have regard to a number of matters, including current knowledge and assessment methods. In addition, the contents and level of detail in a plan such as the ANPS, the stage it has reached in the decision making process and the ability to draw upon sources of information used in other decision making, may affect the nature and extent of the information required to be provided in the environmental report for the strategic environmental assessment. The stage reached by the ANPS should be seen in the context of the statutory framework of the PA 2008, as set out above (see paras 19 38). Section 5(5) authorises the Secretary of State to set out in an NPS the type and size of development appropriate nationally or for a specified area and to identify locations which are either suitable or unsuitable for that development. In addition, the Secretary of State may set out criteria to be applied when deciding the suitability of a location. Section 104(3) requires the Secretary of State to decide an application for a DCO in accordance with a relevant NPS, save in so far as any one or more of the exceptions in section 104(4) (8) applies, which include the situation where the adverse impacts of a proposal are judged to outweigh its benefits (section 104(7)). Section 106(1) empowers the Secretary of State to disregard a representation objecting to such a proposal in so far as it relates to the merits of a policy contained in the NPS. In the present case, the Secretary of State made it plain in the strategic environmental assessment process that the AoS drew upon and updated the extensive work which had previously been carried out by, and on behalf of, the Airports Commission, including numerous reports to the Airports Commission and its own final report. It is common ground that the Secretary of State was entitled to take that course. Article 6 of the SEA Directive sets out requirements for consultation. Article 6(1) requires that the draft plan or programme and the environmental report be made available to the public and to those authorities designated by a member state under article 6(3) which, by virtue of their specific environmental responsibilities, are likely to be concerned by the environmental effects of implementing plans and programmes. In England, the designated authorities are Natural England, Historic England and the Environment Agency (see regulation 4 of the SEA Regulations). In the case of the ANPS, the Secretary of State also had to consult those designated authorities on the scope and level of detail of the information to be included in the environmental report (article 5(4)). In relation to the consultation process, article 6(2) provides: The authorities referred to in para 3 and the public referred to in para 4 shall be given an early and effective opportunity within appropriate time frames to express their opinion on the draft plan or programme and the accompanying environmental report before the adoption of the plan or programme or its submission to the legislative procedure. The public referred to in [article 6(4)] is a cross reference to the rules made by each member state for defining the public affected, or likely to be affected by, or having an interest in the decision making on the plan. Regulation 13(2) of the SEA Regulations leaves this to be determined as a matter of judgment by the plan making authority. Article 8 requires the environmental report prepared under article 5, the opinions expressed under article 6, and the results of any transboundary consultations under article 7 to be taken into account during the preparation of the plan or programme and before its adoption or submission to the legislative procedure. In Cogent Land LLP v Rochford District Council [2012] EWHC 2542 (Admin); [2013] 1 P & CR 2, Singh J held that a defect in the adequacy of an environmental report prepared for the purposes of the SEA Directive may be cured by the production of supplementary material by the plan making authority, subject to there being consultation on that material (see paras 111 126). He held that articles 4, 6(2) and 8 of the Directive, along with their transposition in the SEA Regulations, are consistent with that conclusion; and that none of the previous authorities on the SEA Directive (which he reviewed) suggested otherwise. He held that SEA is not a single document, still less is it the same thing as the environmental report. Rather, it is a process, during the course of which an environmental report must be produced (see para 112). The Court of Appeal endorsed this analysis in No Adastral New Town Ltd v Suffolk Coastal District Council [2015] EWCA Civ 88; [2015] Env LR 28, in deciding that SEA failures in the early stages of an authoritys preparation of its Core Strategy (a statutory development plan) were capable of being, and were in fact, cured by the steps taken in subsequent stages (see paras 48 54). We agree with this analysis. It follows that strategic environmental assessment may properly involve an iterative process; and that it is permissible for a plan making authority to introduce alterations to its draft plan subject to complying with the information requirements in article 5 and the consultation requirements in articles 6 and 7. Regulation 12 of the SEA Regulations transposes the main requirements in article 5 of the Directive governing the content of an environmental report as follows (emphasis added): (2) The report shall identify, describe and evaluate the likely significant effects on the environment of implementing the plan or programme; and (a) (b) reasonable alternatives taking into account the objectives and the geographical scope of the plan or programme. (3) The report shall include such of the information referred to in Schedule 2 to these Regulations as may reasonably be required, taking account of current knowledge and methods of assessment; the contents and level of detail in the plan or (a) (b) programme; (c) decision making process; and (d) the extent to which certain measures are more appropriately assessed at different levels in that process in order to avoid duplication of the assessment. the stage of the plan or programme in the Schedule 2 replicates the list of items in Annex I to the SEA Directive. No issue is raised as to the adequacy of that transposition. As the Divisional Court observed, it is plain from the language as may reasonably be required that the SEA Regulations, like the SEA Directive, allow the plan making authority to make a judgment on the nature of the information in Schedule 2 and the level of detail to be provided in an environmental report, whether as published initially or in any subsequent amendment or supplement. Factual background At the heart of the challenge to the ANPS is the Paris Agreement (para 7 above) which acknowledged that climate change represents an urgent and potentially irreversible threat to human societies and the planet (Preamble to the Decision to adopt the Paris Agreement). In article 2 the Paris Agreement sought to enhance the measures to reduce the risks and impacts of climate change by setting a global target of holding the increase in the global average temperature to well below 2C above pre industrial levels and pursuing efforts to limit the temperature increase to 1.5C above pre industrial levels. Each signatory of the Paris Agreement undertook to take measures to achieve that long term global temperature goal so as to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century (article 4(1)). Each party agreed to prepare, communicate and maintain successive nationally determined contributions (NDCs) that it intended to achieve and to pursue domestic mitigation measures with the aim of achieving the objectives of such NDCs (article 4(2)). A partys successive NDC was to progress beyond its current NDC and was to reflect its highest possible ambition (article 4(3)). Notwithstanding the common objectives set out in articles 2 and 4(1), the Paris Agreement did not impose an obligation on any state to adopt a binding domestic target to ensure that those objectives were met. The specific legal obligation imposed in that regard was to meet any NDC applicable to the state in question. So far as concerns the United Kingdom, it is common ground that the relevant NDC is that adopted and communicated on behalf of the EU, which set a binding target of achieving 40% reduction of 1990 emissions by 2030. This is less stringent than the targets which had already been set in the fourth and fifth carbon budgets issued pursuant to section 4 of the CCA 2008, which were respectively a 50% reduction on 1990 levels for the period 2023 2027 and a 57% reduction for the period 2028 2032. Before the United Kingdom had signed or ratified the Paris Agreement two Government Ministers made statements in the House of Commons about the Governments approach to the Paris Agreement. On 14 March 2016 the Minister of State for Energy, Andrea Leadsom MP, told the House of Commons that the Government believe we will need to take the step of enshrining the Paris goal of net zero emissions in UK law the question is not whether, but how we do it, and there is an important set of questions to be answered before we do. Ten days later (24 March 2016) Amber Rudd MP, Secretary of State for Energy and Climate Change, responded to an oral question on what steps her department was taking to enshrine the net zero emissions commitment of the Paris Climate Change Conference by stating that the question is not whether we do it but how we do it. The Government received advice from the CCC on the UKs response to the Paris goal. At a meeting on 16 September 2016 the CCC concluded that while a new long term target would be needed to be consistent with the Paris goal, the evidence was not sufficient to specify that target now. In October 2016 the CCC published a report entitled UK Climate Action following the Paris Agreement on what domestic action the Government should take as part of a fair contribution to the aims of the Paris Agreement. In that report the CCC stated that the goals of the Paris Agreement involved a higher level of global ambition in the reduction of greenhouse gases than that which formed the basis of the UKs existing emissions reduction targets. But the CCC advised that it was neither necessary nor appropriate to amend the 2050 target in section 1 of the CCA 2008 or alter the level of existing carbon budgets at that time. It advised that there would be several opportunities to revisit the UKs targets in the future and that the UK 2050 target is potentially consistent with a wide range of global temperature outcomes. In its executive summary (p 7) the CCC summarised its advice: Do not set new UK emissions targets now The five yearly cycle of pledges and reviews created by the Paris Agreement provides regular opportunities to consider increasing UK ambition. In October 2017 the Government published its Clean Growth Strategy which set out its policies and proposals to deliver economic growth and decreased emissions. In Annex C in its discussion of UK climate action it acknowledged the risks posed by the growing level of global climate instability. It recorded the global goals of the Paris Agreement and that global emissions of greenhouse gases would need to peak as soon as possible, reduce rapidly thereafter and reach a net zero level in the second half of this century. It recorded the CCCs advice in these terms: In October 2016 the [CCC] said that the Paris Agreement target is more ambitious than both the ambition underpinning the UK 2050 target and previous international agreements, but that the UK should not set new UK emissions targets now, as it already had stretching targets and achieving them will be a positive contribution to global climate action. The CCC advised that the UKs fair contribution to the Paris Agreement should include measures to maintain flexibility to go further on UK targets, the development of options to remove greenhouse gases from the air, and that its targets should be kept under review. In December 2017 Plan B Earth and 11 other claimants commenced judicial review proceedings against the Secretary of State for BEIS and CCC alleging that the Secretary of State had unlawfully failed to revise the 2050 target in section 1 of the CCA 2008 in line with the Paris Agreement. The Secretary of State pleaded: [While] the Government is fully committed to the objectives in the Paris Agreement, the legal obligation upon the Parties is to prepare, communicate and maintain nationally determined contributions to reduce net emissions, with a view to achieving the purpose of holding global average temperature increases to well below 2C above pre industrial levels and pursuing efforts to limit them to 1.5C. This is not the same as a legal duty or obligation for the Parties, individually or collectively, to achieve this aim. (Emphasis in original) The CCC also explained its position in its written pleadings: The CCC recommended no change to the existing UK 2050 target (at that time, October 2016), not because a more ambitious target was unfeasible, but rather because the existing UK target was potentially consistent with more ambitious global temperature goals, including that in the Paris Agreement. At an oral hearing ([2018] EWHC 1892 (Admin); [2019] Env LR 13), Supperstone J refused permission to proceed with the judicial review, holding among other things that the Paris Agreement did not impose any legally binding target on each contracting party, that section 2 of the CCA 2008 gave the Secretary of State the power, but did not impose a duty, to amend the 2050 target in the event of developments in scientific knowledge or European or international law or policy, and that on the basis of the advice of the CCC, the Secretary of State was plainly entitled to refuse to change the 2050 target. Asplin LJ refused permission to appeal on 22 January 2019. In January 2018 the CCC published An independent assessment of the UKs Clean Growth Strategy. In that report the CCC explained that the aim of the Paris Agreement for emissions to reach net zero in the second half of the century was likely to require the UK to revise its statutory 2050 target to seek greater reductions and advised that it is therefore essential that actions are taken now to enable these deeper reductions to be achieved (p 21). The CCC invited the Secretary of State for BEIS to seek further advice from it and review the UKs long term emissions targets after the publication of the report by the Intergovernmental Panel on Climate Change (IPCC) on the implications of the Paris Agreements 1.5C goal. In January 2018 the Government published A Green Future: Our 25 Year Plan to Improve the Environment in which it undertook to continue its work in providing international leadership to meet the goals of the Paris Agreement (for example, p 118). In early 2018 governments, including the UK Government, were able to review a draft of the IPCC report and in early June 2018 the UK Government submitted final comments on the draft of the IPCC report. On 17 April 2018 the Government announced at the Commonwealth Heads of Government Meeting that after the publication of the IPCC report later that year, it would seek the advice of the CCC on the implications of the Paris Agreement for the UKs long term emissions reductions targets. At the same time the Government was working to develop an aviation strategy which would address aviation emissions. In April 2018, after public consultation, the Department for Transport published Beyond the Horizon: The Future of UK Aviation Next Steps towards an Aviation Strategy in which it undertook to investigate technical and policy measures to address aviation emissions and how those measures related to the recommendations of the CCC. It stated (para 6.24): The government will look again at what domestic policies are available to complement its international approach and will consider areas of greater scientific uncertainty, such as the aviations contribution to non carbon dioxide climate change effects and how policy might make provision for their effects. On 1 May in response to an oral parliamentary question concerning the offshore wind sector Claire Perry MP, Minister of State for Energy and Clean Growth, stated that the UK was the first developed nation to have said that it wanted to understand how to get to a zero carbon economy by 2050. On 5 June 2018, the Government issued its response to the consultation on the draft ANPS and the Secretary of State laid the proposed ANPS before Parliament. On the same day, the Secretary of State presented a paper on the proposed ANPS to a Cabinet sub committee giving updated information on the three short listed schemes and the Governments preference for the NWR scheme. In relation to aviation emissions it stated that it was currently uncertain how international carbon emissions would be incorporated into the Governments carbon budget framework, that policy was developing and would be progressed during the development of the Aviation Strategy. The Governments position remained that action to address aviation emissions was best taken at an international level. On 14 June 2018 the Chair of the CCC (Lord Deben) and Deputy Chair (Baroness Brown) wrote to the Secretary of State expressing surprise that he had not referred to the legal targets in the CCA 2008 or the Paris Agreement commitments in his statement to the House of Commons on the proposed ANPS on 5 June and stressing the need for his department to consider aviations place in the overall strategy for UK emissions reduction. They stated that the Government should not plan for higher levels of aviation emissions since this would place an unreasonably large burden on other sectors. The Secretary of State responded on 20 June 2018 stating that the Government remained committed to the UKs climate change target and that the proposed ANPS made it clear that an increase in carbon emissions that would have a material impact on the Governments ability to meet its carbon reduction targets would be a reason to refuse development consent for the NWR. He stated that the Government was confident that the measures and requirements set out in the proposed ANPS provided a strong basis for mitigating the environmental impacts of expansion. He explained that the forthcoming Aviation Strategy would put in place a framework for UK carbon emissions to 2050, which ensures that aviation contributes its fair share to action on climate change, taking into account the UKs domestic and international obligations. After the Parliamentary debate on 25 June 2018 (para 11 above), the Secretary of State designated the ANPS as national policy on 26 June 2018 (para 12 above). Section 5 of the ANPS focused on the potential impacts of the NWR Scheme and the assessments that any applicant would have to carry out and the planning requirements which it would have to meet in order to gain development consent. In its discussion of greenhouse gas emissions the ANPS stated that the applicant would have to undertake an environmental impact assessment quantifying the greenhouse gas impacts before and after mitigation so that the project could be assessed against the Governments carbon obligations. In para 5.82 the ANPS stated: Any increase in carbon emissions alone is not a reason to refuse development consent, unless the increase in carbon emissions resulting from the project is so significant that it would have a material impact on the ability of Government to meet its carbon reduction targets, including carbon budgets. As in this appeal a challenge has been made as to the factual basis of the Secretary of States decision not to consider the possible new domestic emissions targets which might result from the Paris Agreement, it is necessary to mention the evidence before the Divisional Court on this matter. In her first witness statement Ms Caroline Low, the Director of the Airport Capacity Programme at the Department for Transport, stated (para 458): In October 2016 the CCC said that the Paris Agreement is more ambitious than both the ambition underpinning the UK 2050 target and previous international agreements but that the UK should not set new UK emissions targets now, as it already has stretching targets and achieving them will be a positive contribution to global climate action. Furthermore, the CCC acknowledged in the context of separate legal action brought by Plan B against the Secretary of State for Business, Energy and Industrial Strategy that it is possible that the existing 2050 target could be consistent with the temperature stabilization goals set out in the Paris Agreement. Subsequently, in establishing its carbon obligations for the purpose of assessing the impact of airport expansion, my team has followed this advice and considered existing domestic legal obligations as the correct basis for assessing the carbon impact of the project, and that it is not appropriate at this stage for the government to consider any other possible targets that could arise through the Paris Agreement. Her account was corroborated by Ms Ursula Stevenson, an engineering and project management consultant whom the Secretary of State retained to deal with the process for consideration of the environmental impacts of the NWR Scheme. She stated (witness statement para 3.128) that the Department had followed the CCCs advice when preparing the AoS required by the PA 2008 (see para 28 above) and accordingly had considered existing domestic legal obligations to be the correct basis for assessing the carbon impact of the project. She added: At this stage, it is not possible to consider what any future targets [sic] might be recommended by the CCC to meet the ambitions of the Paris Agreement. It is expected that, should more ambitious targets be recommended and set through the carbon budgets beyond 2032, then government will be required to make appropriate policy decisions across all sectors of the economy to limit emissions accordingly. She emphasised (para 3.129) that the obligations under the CCA 2008 could be made more stringent in future, should that prove necessary, and that the ANPS provided that any application for a DCO would have to be assessed by reference to whatever obligations were in place at that time. The IPCC Special Report on Global Warming of 1.5C was published on 8 October 2018. It concluded that limiting global warming to that level above pre industrial levels would significantly reduce the risks of challenging impacts on ecosystems and human health and wellbeing and that it would require deep emissions reductions and rapid, far reaching and unprecedented changes to all aspects of society. To achieve that target global net emissions of CO would need to fall by about 45% from 2010 levels by 2030, reaching zero by 2050. The Government commissioned the CCC to advise on options by which the UK should achieve (i) a net zero greenhouse gas target and/or (ii) a net zero carbon target in order to contribute to the global ambitions set out in the Paris Agreement, including whether now was the right time to set such a target. In December 2018 the Department for Transport published consultation materials on its forthcoming Aviation Strategy. In Aviation 2050: The future of UK aviation the Department stated (paras 3.83 3.87) that it proposed to negotiate in the International Civil Aviation Organisation (the UN body responsible for tackling international aviation climate emissions) for a long term goal for international aviation that is consistent with the temperature goals of the Paris Agreement and that it would consider appropriate domestic action to support international progress. It stated that the Government would review the CCCs revised aviation advice and advice on the implications of the Paris Agreement. In the same month, in a paper commissioned and published by the Department and written by David S Lee, International aviation and the Paris Agreement temperature goals the author acknowledged that the Paris Agreement had a temperature based target which implied the inclusion of all emissions that affect the climate. The author stated that aviation had significant climate impacts from the oxides of nitrogen, particle emissions, and effects on cloudiness but that those impacts were subject to greater scientific uncertainty than the impacts of CO. It recorded that examples of CO emission equivalent metrics indicated up to a doubling of aviation CO equivalent emissions to account for those non CO effects. On 1 May 2019 Parliament approved a motion to declare a climate and environmental emergency. On the following day, the CCC published a report entitled Net zero: The UKs contribution to stopping global warming, in which they recommended that legislation should be passed as soon as possible to create a new statutory target of net zero greenhouse gases by 2050 and the inclusion of international aviation and shipping in that target (p 15). That recommendation, so far as it related to the CO target, was implemented on 26 June 2019 when the Climate Change Act (2050 Target Amendment) Order 2019 amended section 1(1) of the CCA 2008. On 24 September 2019 the CCC wrote to the Secretary of State for Transport advising that the international aviation and shipping emissions should be brought formally within the UKs net zero statutory 2050 target. The statutory target has not yet been changed to this effect but international aviation and shipping are taken into account when the carbon budgets are set against the statutory target: section 10(2)(i) of the CCA 2008. On 25 June 2020 the CCC published its 2020 Progress Report to Parliament entitled Reducing UK emissions, in which it recommended that international aviation and shipping be included in the UK climate targets when the Sixth Carbon Budget is set (which should be in 2021) and net zero plans should be developed (p 22). It recommended that the UKs airport capacity strategy be reviewed in the light of COVID 19 and the net zero target and that action was needed on non CO effects from aviation (p 180). The parties to this appeal have stated in the agreed Statement of Facts and Issues that it was expected that the Governments Aviation Strategy will be published before the end of 2020. From this narrative of events it is clear that the Governments response to the targets set in the Paris Agreement has been developing over time since 2016, that it has led to the amendment of the statutory CO target in section 1(1) of the CCA 2008 approximately one year after the Secretary of State designated the ANPS, and that the Government is still in the process of developing its Aviation Strategy in response to the advice of the CCC. Before turning to the legal challenges in this appeal it is also important to emphasise that, as we have stated in para 10 above, HAL, FoE and Plan B Earth agree that should the NWR Scheme be taken forward to a DCO application, the ANPS would not allow it to be assessed by reference to the carbon reduction targets, including carbon budgets, that were in place when the ANPS was designated in June 2018. The ANPS requires that the scheme be assessed against the carbon reduction targets in place at the time when a DCO application is determined: para 5.82 of the ANPS which we have set out in para 87 above. There is therefore no question of the NWR Scheme being assessed in future against outdated emissions targets. The judgments of the Divisional Court and the Court of Appeal A number of objectors to the NWR Scheme and the ANPS brought a large number of disparate claims in these proceedings to challenge the ANPS. The Divisional Court heard the claims on a rolled up basis, that is to say by considering the question of whether to grant permission to apply for judicial review at the same time as considering the merits of the claims should permission be granted. The hearing lasted for seven days and involved a full merits consideration of all the claims by the Divisional Court. In a judgment of high quality, described by the Court of Appeal as a tour de force, the Divisional Court dismissed all of the claims. For some claims it granted permission to apply for judicial review and then dismissed them on the merits. For others, it decided that they were not reasonably arguable on the merits and refused to grant permission. After thorough examination, the Divisional Court reached the conclusion that none of the claims which form the subject of grounds (i) to (iv) in the present appeal were reasonably arguable, and accordingly refused permission to apply for judicial review in relation to each of them. In relation to those claims, the Court of Appeal decided that they were both arguable and that they were made out as good claims. Accordingly, the Court of Appeal granted permission in relation to them for the respondents to apply for judicial review of the decision to designate the ANPS and then held that the ANPS was of no legal effect unless and until a review was carried out rectifying the legal errors. Analysis Ground (i) the section 5(8) ground This ground raises a question of statutory interpretation. Section 5(7) and (8) of the PA 2008, which we set out in para 25 above, provide that an NPS must give reasons for the policy set out in the statement and that the reasons must explain how the policy in the NPS takes account of Government policy relating to the mitigation of, and adaptation to, climate change. Mr Crosland for Plan B Earth presented this argument. Mr Wolfe QC for FoE adopted his submissions. Mr Crosland submits that it was unlawful for the Secretary of State when stating the reasons for the policy in the ANPS in June 2018 to have treated as irrelevant the Governments commitment to (a) the temperature target in the Paris Agreement and (b) the introduction of a new net zero carbon target. The Governments commitment to the Paris Agreement targets constituted Government policy within the meaning of section 5(8) of the PA 2008 and so should have been addressed in giving the reasons for the ANPS. Plan B Earth advanced this argument before the Divisional Court, which rejected the submission. The Divisional Court held that the Paris Agreement did not impose an obligation on any individual state to implement its global objective in any particular way, Parliament had determined the contribution of the UK towards global targets in section 1 of the CCA 2008 as a national carbon cap which represented the relevant policy in an entrenched form, and the Secretary of State could not change that carbon target unless and until the conditions set out in that Act were met. The Court of Appeal disagreed with the approach of the Divisional Court and held that Government policy in section 5(8) was not confined to the target set out in the CCA 2008. The words Government policy were words of the ordinary English language. Taking into account the consequences of the Paris Agreement involved no inconsistency with the provisions of the CCA 2008. Based on the Secretary of States written pleadings the Court of Appeal concluded that the Secretary of State had received and accepted legal advice that he was legally obliged not to take into account the Paris Agreement and the court characterised that as a misdirection of law. We address that conclusion in the next section of this judgment at paras 124 129 below. The court held that section 5(8) of the PA 2008 simply required the Government to take into account its own policy. The statements of Andrea Leadsom MP and Amber Rudd MP in March 2016 (para 72 above) and the formal ratification of the Paris Agreement showed that the Governments commitment to the Paris Agreement was part of Government policy by the time of the designation of the ANPS in June 2018. The principal question for determination is the meaning of Government policy in section 5(8) of the PA 2008. We adopt a purposive approach to this statutory provision which expands upon the obligation in section 5(7) that an NPS give reasons for the policy set out in it and interpret the statutory words in their context. The purpose of the provision is to make sure that there is a degree of coherence between the policy set out in the NPS and established Government policies relating to the mitigation of and adaptation to climate change. The section speaks of Government policy, which points toward a policy which has been cleared by the relevant departments on a government wide basis. In our view the phrase is looking to carefully formulated written statements of policy such as one might find in an NPS, or in statements of national planning policy (such as the National Planning Policy Framework), or in government papers such as the Aviation Policy Framework. For the subsection to operate sensibly the phrase needs to be given a relatively narrow meaning so that the relevant policies can readily be identified. Otherwise, civil servants would have to trawl through Hansard and press statements to see if anything had been said by a minister which might be characterised as policy. Parliament cannot have intended to create a bear trap for ministers by requiring them to take into account any ministerial statement which could as a matter of ordinary language be described as a statement of policy relating to the relevant field. In our view, the epitome of Government policy is a formal written statement of established policy. In so far as the phrase might in some exceptional circumstances extend beyond such written statements, it is appropriate that there be clear limits on what statements count as Government policy, in order to render them readily identifiable as such. In our view the criteria for a policy to which the doctrine of legitimate expectations could be applied would be the absolute minimum required to be satisfied for a statement to constitute policy for the purposes of section 5(8). Those criteria are that a statement qualifies as policy only if it is clear, unambiguous and devoid of relevant qualification: see for example Inland Revenue Comrs v MFK Underwriting Agents Ltd [1990] 1 WLR 1545, 1569 per Bingham LJ; R (Gaines Cooper) v Comrs for Her Majestys Revenue and Customs [2011] UKSC 47; [2011] 1 WLR 2625, paras 28 and 29 per Lord Wilson of Culworth, delivering the judgment with which the majority of the court agreed, and para 70 per Lord Mance. The statements of Andrea Leadsom MP and Amber Rudd MP (para 72 above) on which the Court of Appeal focused and on which Plan B Earth particularly relied do not satisfy those criteria. Their statements were not clear and were not devoid of relevant qualification in this context. They did not refer to the temperature targets at all and they both left open the question of how the Paris Agreement goal of net zero emissions would be enshrined in UK law. Andrea Leadsom went out of her way to emphasise that there is an important set of questions to be answered before we do. The statements made by these ministers were wholly consistent with and plainly reflected the fact that there was then an inchoate or developing policy being worked on within Government. This does not fall within the statutory phrase. We therefore respectfully disagree with the Court of Appeal in so far as they held (para 224) that the words Government policy were ordinary words which should be applied in their ordinary sense to the facts of a given situation. We also disagree with the courts conclusion (para 228) that the statements by Andrea Leadsom MP and Amber Rudd MP constituted statements of Government policy for the purposes of section 5(8). Although the point had been a matter of contention in the courts below, no party sought to argue before this court that a ratified international treaty which had not been implemented in domestic law fell within the statutory phrase Government policy. Plan B Earth and FoE did not seek to support the conclusion of the Court of Appeal (para 228) that it followed from the solemn act of the United Kingdoms ratification of [the Paris Agreement] that the Governments commitment to it was part of Government policy. The fact that the United Kingdom had ratified the Paris Agreement is not of itself a statement of Government policy in the requisite sense. Ratification is an act on the international plane. It gives rise to obligations of the United Kingdom in international law which continue whether or not a particular government remains in office and which, as treaty obligations, are not part of UK law and give rise to no legal rights or obligations in domestic law (R (Miller) v Secretary of State for Exiting the European Union [2017] UKSC 5; [2018] AC 61, para 55). Ratification does not constitute a commitment operating on the plane of domestic law to perform obligations under the treaty. Moreover, it cannot be regarded in itself as a statement devoid of relevant qualification for the purposes of domestic law, since if treaty obligations are to be given effect in domestic law that will require law making steps which are uncertain and unspecified at the time of ratification. Before applying these conclusions to the facts of this case, it is necessary to consider another argument which HAL advances in this appeal. HAL renews an argument which the Divisional Court had accepted at least in part. HAL argues that because Parliament had set out the target for the reduction of carbon emissions in section 1 of the CCA 2008 and had established a statutory mechanism by which the target could be altered only with the assent of Parliament, Government policy was entrenched in section 1 and could not be altered except by use of the subordinate legislation procedure in sections 2 and 3 of the CCA 2008. The statutory scheme had either expressly or by necessary implication displaced the prerogative power of the Government to adopt any different policy in this field. In support of this contention HAL refers to the famous cases of Attorney General v De Keysers Royal Hotel Ltd [1920] AC 508 and R v Secretary of State for the Home Department, Ex p Fire Brigades Union [1995] 2 AC 513, to which this court referred in R (Miller) v Secretary of State for Exiting the European Union [2017] UKSC 5; [2018] AC 61. The short answer to that submission is that it is possible for the Government to have a policy that it will seek Parliamentary approval of an alteration of the carbon target, which is to be taken into account in section 5(8) of the PA 2008. The ousting of a prerogative power in a field which has become occupied by a corresponding power conferred or regulated by statute is a legal rule which is concerned with the validity of the exercise of a power, and to the extent that exercise of powers might require reference to the target set out in section 1 of the CCA 2008 it would not be open to the Government to make reference to a different target, not as yet endorsed by Parliament under the positive resolution procedure applicable to changes to that statutory target. However, the rule does not address what is Government policy for the purposes of section 5(8) of the PA 2008. If at the date when the Secretary of State designated the ANPS, the Government had adopted and articulated a policy that it would seek to introduce a specified new carbon target into section 1 of the CCA 2008 by presenting draft subordinate legislation to that effect for the approval of Parliament, the Secretary of State could readily record in the ANPS that the Government had resolved to seek that change but that it required the consent of Parliament for the new target to have legal effect. Further, questions such as how to mitigate non CO emissions fell outside the carbon emissions target in the CCA 2008. Turning to the facts of the case, it is clear from the narrative of events in paras 70 96 above that in June 2018, when the Secretary of State for Transport designated the ANPS, the Governments approach on how to adapt its domestic policies to contribute to the global goals of the Paris Agreement was still in a process of development. There was no established policy beyond that already encapsulated in the CCA 2008. The Government followed the advice of the CCC. The CCCs advice in 2016 was that the evidence was not sufficient to specify a new carbon target and that it was not necessary to do so at that time (paras 73 74 above). In early 2018 the CCC invited the Government to seek further advice from it after the publication of the IPCCs report (para 79 above). During 2018 the Governments policy in relation to aviation emissions was in a process of development and no established policy had emerged on either the steps to be taken at international level or about which domestic measures would be adopted; it was expected that the forthcoming Aviation Strategy would clarify those matters (paras 83 and 86 above). The Governments consultation in December 2018 confirmed that the development of aviation related targets was continuing and in 2020 the Governments Aviation Strategy is still awaited (paras 92 and 96 above). Against this background, the section 5(8) challenge fails and HALs appeal on this ground must succeed. It is conceded that the Paris Agreement itself is not Government policy. The statements by Andrea Leadsom MP and Amber Rudd MP in 2016, on which Plan B Earth principally founds, do not amount to Government policy for the purpose of section 5(8) of the PA 2008. The statements concerning the development of policy which the Government made in 2018 were statements concerning an inchoate and developing policy and not an established policy to which section 5(8) refers. Mr Crosland placed great emphasis on the facts (i) that the Airports Commission had assessed the rival schemes against scenarios, one of which was that overall CO emissions were set at a cap consistent with a worldwide goal to limit global warming to 2C, and (ii) that that scenario was an input into Secretary of States assessment of the ANPS at a time when the UK Government had ratified the Paris Agreement and ministers had made the statements to which we referred above. But those facts are irrelevant to the section 5(8) challenge. It is not in dispute that the internationally agreed temperature targets played a formative role in the development of government policy. But that is not enough for Plan B Earth to succeed in this challenge. What Mr Crosland characterised as a policy commitment to the Paris Agreement target did not amount to Government policy under that subsection. Finally, Mr Crosland sought to raise an argument under section 3 of the Human Rights Act 1998 that interpreting section 5(8) so as to preclude consideration of the temperature limit in the Paris Agreement would tend to allow major national projects to be developed and that those projects would create an intolerable risk to life and to peoples homes contrary to articles 2 and 8 of the European Convention on Human Rights (ECHR). This argument must fail for two reasons. First, as Lord Anderson for HAL submits, the argument was advanced as a separate ground before the Divisional Court and rejected, that finding was not appealed to the Court of Appeal, and is therefore not before this court. Secondly, even if it were to be treated as an aspect of Plan B Earths section 5(8) submission and thus within the scope of the appeal (as Mr Crosland sought to argue), it is in any event unsound because any effect on the lives and family life of those affected by the climate change consequences of the NWR Scheme would result not from the designation of the ANPS but from the making of a DCO in relation to the scheme. As HAL has conceded and the respondents have agreed, the ANPS requires the NWR Scheme to be assessed against the emissions targets which would be current if and when an application for a DCO were determined. Ground (ii): the section 10 ground Mr Wolfe for FoE presented the submissions for the respondents on this ground and grounds (iii) and (iv). Mr Crosland for Plan B Earth adopted those submissions. Section 10 of the PA 2008 applies to the Secretary of States function in promulgating an NPS. In exercising that function the Secretary of State must act with the objective of contributing to the achievement of sustainable development. Sustainable development is a recognised term in the planning context and its meaning is not controversial in these proceedings. As explained in paras 7 and 8 of the National Planning Policy Framework (July 2018), at a very high level the objective of sustainable development involves meeting the needs of the present without compromising the ability of future generations to meet their own needs; it has three overarching elements, namely an environmental objective, an economic objective and a social objective. For a major infrastructure project like the development of airport capacity in the South East, which promotes economic development but at the cost of increased greenhouse gases emissions, these elements have to be taken into account and balanced against each other. Section 10(3)(a) provides that the Secretary of State must, in particular, have regard to the desirability of mitigating, and adapting to, climate change. Unlike in section 5(8) of the PA 2008, this is not a factor which is tied to Government policy. As it transpired, very little divided the parties under this ground. The basic legal approach is agreed. A useful summation of the law was given by Simon Brown LJ in R v Somerset County Council, Ex p Fewings [1995] 1 WLR 1037, 1049, in which he identified three categories of consideration, as follows: [T]he judge speaks of a decision maker who fails to take account of all and only those considerations material to his task. It is important to bear in mind, however, that there are in fact three categories of consideration. First, those clearly (whether expressly or impliedly) identified by the statute as considerations to which regard must be had. Second, those clearly identified by the statute as considerations to which regard must not be had. Third, those to which the decision maker may have regard if in his judgment and discretion he thinks it right to do so. There is, in short, a margin of appreciation within which the decision maker may decide just what considerations should play a part in his reasoning process. The three categories of consideration were identified by Cooke J in the New Zealand Court of Appeal in CREEDNZ Inc v Governor General [1981] NZLR 172, 183: What has to be emphasised is that it is only when the statute expressly or impliedly identifies considerations required to be taken into account by the [relevant public authority] as a matter of legal obligation that the court holds a decision invalid on the ground now invoked. It is not enough that a consideration is one that may properly be taken into account, nor even that it is one which many people, including the court itself, would have taken into account if they had to make the decision. Cooke J further explained at p 183 in relation to the third category of consideration that, notwithstanding the silence of the statute, there will be some matters so obviously material to a decision on a particular project that anything short of direct consideration of them by [the public authority] would not be in accordance with the intention of the Act. These passages were approved as a correct statement of principle by the House of Lords in In re Findlay [1985] AC 318, 333 334. See also R (Hurst) v London Northern District Coroner [2007] UKHL 13; [2007] 2 AC 189, paras 55 59 (Lord Brown of Eaton under Heywood, with whom a majority of the Appellate Committee agreed); R (Corner House Research) v Director of the Serious Fraud Office [2008] UKHL 60; [2009] 1 AC 756, para 40 (Lord Bingham of Cornhill, with whom a majority of the Appellate Committee agreed); and R (Samuel Smith Old Brewery (Tadcaster)) v North Yorkshire County Council [2020] UKSC 3; [2020] PTSR 221, paras 29 32 (Lord Carnwath, with whom the other members of the court agreed). In the Hurst case, Lord Brown pointed out that it is usually lawful for a decision maker to have regard to unincorporated treaty obligations in the exercise of a discretion (para 55), but that it is not unlawful to omit to do so (para 56). As the Court of Appeal correctly held in Baroness Cumberlege of Newick v Secretary of State for Communities and Local Government [2018] EWCA Civ 1305; [2018] PTSR 2063, paras 20 26, in line with these other authorities, the test whether a consideration falling within the third category is so obviously material that it must be taken into account is the familiar Wednesbury irrationality test (Associated Provincial Picture Houses Ltd v Wednesbury Corpn [1948] 1 KB 223; Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374, 410 411 per Lord Diplock). It is possible to subdivide the third category of consideration into two types of case. First, a decision maker may not advert at all to a particular consideration falling within that category. In such a case, unless the consideration is obviously material according to the Wednesbury irrationality test, the decision is not affected by any unlawfulness. Lord Bingham deals with such a case in Corner House Research at para 40. There is no obligation on a decision maker to work through every consideration which might conceivably be regarded as potentially relevant to the decision they have to take and positively decide to discount it in the exercise of their discretion. Secondly, a decision maker may in fact turn their mind to a particular consideration falling within the third category, but decide to give the consideration no weight. As we explain below, this is what happened in the present case. The question again is whether the decision maker acts rationally in doing so. Lord Brown deals with a case of this sort in Hurst (see para 59). This shades into a cognate principle of public law, that in normal circumstances the weight to be given to a particular consideration is a matter for the decision maker, and this includes that a decision maker might (subject to the test of rationality) lawfully decide to give a consideration no weight: see, in the planning context, Tesco Stores Ltd v Secretary of State for the Environment [1995] 1 WLR 759 (HL), 780 (Lord Hoffmann). The Divisional Court (para 648) and the Court of Appeal (para 237) held that the Paris Agreement fell within the third category identified in Fewings. In so far as it is an international treaty which has not been incorporated into domestic law, this is correct. In fact, however, as we explain (para 71 above), the UKs obligations under the Paris Agreement are given effect in domestic law, in that the existing carbon target under section 1 of the CCA 2008 and the carbon budgets under section 4 of that Act already meet (and, indeed, go beyond) the UKs obligations under the Paris Agreement to adhere to the NDCs notified on its behalf under that Agreement. The duties under the CCA 2008 clearly were taken into account when the Secretary of State decided to issue the ANPS. At para 5.69 of the ANPS the Secretary of State stated: The Government has a number of international and domestic obligations to limit carbon emissions. Emissions from both the construction and operational phases of the [NWR Scheme] project will be relevant to meeting these obligations. This statement covered the Paris Agreement as well as other international treaties. At para 5.71 the ANPS correctly stated that [t]he UKs obligations on greenhouse gas emissions are set under the [CCA 2008]. As explained above, the relevant NDCs required to be set under the Paris Agreement were covered by the target in the CCA 2008 and the carbon budgets set under that Act. At paras 5.72 5.73 of the ANPS it was explained how aviation emissions were taken into account in setting carbon budgets under the CCA 2008 in accordance with the advice given by the CCC. We have set out the evidence of Ms Low and Ms Stevenson regarding this topic (paras 88 and 89 above) which confirms that, in acting for the Secretary of State in drawing up the ANPS, they followed the advice of the CCC that the existing measures under the CCA 2008 were capable of being compatible with the 2050 target set by the Paris Agreement. The CCC did not recommend adjusting the UKs targets further at that stage. They were to be kept under review and appropriate adjustments could be made to the emissions target and carbon budgets under the CCA 2008 in future as necessary. According to that advice, therefore, sufficient account was taken of the Paris Agreement by ensuring that the relevant emissions target and carbon budgets under the CCA 2008 would be properly taken into account in the construction and operation of the NWR Scheme. The ANPS ensured that this would occur: see para 5.82 (set out at para 87 above). Therefore, on a correct understanding of the ANPS and the Secretary of States evidence, this is not a case in which the Secretary of State omitted to give any consideration to the Paris Agreement; nor is it one in which no weight was given to the Paris Agreement when the Secretary of State decided to issue the ANPS. On the contrary, the Secretary of State took the Paris Agreement into account and, to the extent that the obligations under it were already covered by the measures under the CCA 2008, he gave weight to it and ensured that those obligations would be brought into account in decisions to be taken under the framework established by the ANPS. On proper analysis the question is whether the Secretary of State acted irrationally in omitting to take the Paris Agreement further into account, or give it greater weight, than in fact he did. In its judgment, the Divisional Court recorded (para 638) that the Secretary of State accepted that, in designating the ANPS, he took into account only the CCA 2008 carbon emission targets and did not take into account either the Paris Agreement or otherwise any post 2050 target or non CO2 emissions (these latter points are relevant to ground (iv) below). However, this way of describing the position masks somewhat the way the Paris Agreement did in fact enter into consideration by the Secretary of State. In the same paragraph, the Divisional Court summarised two submissions advanced by counsel for the Secretary of State as to why the Secretary of States approach was not unlawful: (i) on its proper construction, and having regard to the express reference to the UKs international obligations in section 104(4) of the PA 2008, the PA 2008 requires the Secretary of State to ignore international commitments except where they are expressly referred to in that Act; alternatively, (ii) even if not obliged to ignore such commitments, the Secretary of State had a discretion as to whether to do so and was not obliged to take them into account. The Divisional Court rejected the first argument but accepted the second. It noted that the Secretary of State was bound by the obligations in the CCA 2008, which effectively transposed international obligations into domestic law (para 643). Beyond that, the Secretary of State had a discretion whether to take the Paris Agreement further into account, and had not (even arguably) acted irrationally in deciding not to do so. It therefore refused to give permission for judicial review of the ANPS on this ground. The Court said (para 648): In our view, given the statutory scheme in the CCA 2008 and the work that was being done on if and how to amend the domestic law to take into account the Paris Agreement, the Secretary of State did not arguably act unlawfully in not taking into account that Agreement when preferring the NWR Scheme and in designating the ANPS as he did. As we have described, if scientific circumstances change, it is open to him to review the ANPS; and, in any event, at the DCO stage this issue will be re visited on the basis of the then up to date scientific position. Mr Wolfe sought to support the judgment of the Court of Appeal in relation to this ground. He argued that the evidence for the Secretary of State had to be read in the light of the first submission made by his counsel in the Divisional Court, and that the true position was that the Secretary of State (acting by his officials and advisers) had been advised that he was not entitled to have regard to the Paris Agreement when deciding whether to designate the ANPS and had proceeded on that basis, with the result that he had not in fact exercised any discretion in deciding not to have further regard to the Paris Agreement. He also submitted that it was obvious that it was a material consideration. Mr Wolfe was successful in persuading the Court of Appeal on these points (paras 203 and 234 238 of its judgment). The Court of Appeal accepted his submissions that there was an error of law in the approach of the Secretary of State because he never asked himself the question whether he could take into account the Paris Agreement pursuant to his obligations under section 10 and [i]f he had asked himself that question the only answer that would reasonably have been open to him is that the Paris Agreement was so obviously material to the decision he had to make in deciding whether to designate the ANPS that it was irrational not to take it into account. With respect to the Court of Appeal, they were wrong to overturn the judgment of the Divisional Court on this ground. Mr Wolfes submissions conflated a submission of law (submission (i) above) made by counsel for the Secretary of State as recorded in para 638 of the judgment of the Divisional Court and the evidence of fact given by the relevant witnesses for the Secretary of State. In making his submission of law, counsel was not giving evidence about the factual position. There is a fundamental difference between submissions of law made by counsel and evidence of fact. Clearly, if the Secretary of State had been correct in submission (i) that would have provided an answer to the case against him whatever the position on the facts. This explains why counsel advanced the submission. But it is equally clear that if that submission failed, the Secretary of State made an alternative submission that he had a discretion whether to take the Paris Agreement further into account than was already the case under the CCA 2008 and that there had been no error of law in the exercise of that discretion. That was the submission accepted by the Divisional Court. In our view, both the submissions of Mr Wolfe which the Court of Appeal accepted are unsustainable. The Divisional Courts judgment on this point is correct. On the evidence, the Secretary of State certainly did ask himself the question whether he should take into account the Paris Agreement beyond the extent to which it was already reflected in the obligations under the CCA 2008 and concluded in the exercise of his discretion that it would not be appropriate to do so. As mentioned above, this case is in the class referred to in para 121 above. Mr Wolfe sought to suggest that in deciding the case as it did, the Court of Appeal had acted as a first instance court (since the Divisional Court had refused to give permission for judicial review on this ground) and that it had made factual findings to contrary effect which this court was not entitled to go behind. He also submitted that HAL, in its notice of appeal, had not questioned the factual position as it was taken to be by the Court of Appeal and was therefore not entitled to dispute it on this appeal. Neither of these submissions has any merit. The Divisional Court considered the claims brought against the Secretary of State at a rolled up hearing lasting many days and considered each claim in full and in depth. In respect of all aspects of the Divisional Courts decision, both in relation to those claims on which it granted permission for judicial review but then dismissed the claim and in relation to those claims (including those relating to grounds (i) to (iv) in this appeal) on which after full consideration it decided they were unarguable and so refused to grant permission for judicial review, the Court of Appeal correctly understood that its role was the conventional role of an appellate court, to examine whether the Divisional Court had erred in its decision. In any event, this court can read the undisputed evidence of Ms Low and Ms Stevenson for itself and has the benefit of an agreed Statement of Facts and Issues which makes it clear what the true factual position was. The Court of Appeal was wrong to proceed on the basis of a different assessment of the facts. On a fair reading of HALs notice of appeal, it indicated that its case under this ground was to be that the Secretary of State had a discretion whether to have regard to the Paris Agreement, which discretion had been exercised lawfully. In any event, that was put beyond doubt by HALs written case. FoE and Plan B Earth have been on notice of HALs case under this ground for a long time and are in no way prejudiced by it being presented in submissions to this court. The view formed by the Secretary of State, that the international obligations of the UK under the Paris Agreement were sufficiently taken into account for the purposes of the designation of the ANPS by having regard to the obligations under the CCA 2008, was in our judgment plainly a rational one. Mr Wolfe barely argued to the contrary. The Secretary of States assessment was based on the advice of the CCC, as the relevant independent expert body. The assessment cannot be faulted. Further, the ANPS itself indicated at para 5.82 that the up to date carbon targets under the CCA 2008, which would reflect developing science and any change in the UKs international obligations under the Paris Agreement, would be taken into account at the stage of considering whether a DCO should be granted. That was a necessary step before the NWR Scheme could proceed. Moreover, as observed by the Divisional Court, there was scope for the Secretary of State to amend the ANPS under section 6 of the PA 2008, should that prove to be necessary if it emerged in the future that there was any inconsistency between the ANPS and the UKs obligations under the Paris Agreement. It should also be observed that the carbon emissions associated with all three of the principal options identified by the Airports Commission (that is, the NWR Scheme, the ENR Scheme and the G2R Scheme) were assessed to be broadly similar. Accordingly, reference to the Paris Agreement does not provide any basis for preferring one scheme rather than another. To the extent the obligations under the Paris Agreement have a bearing on the decision to designate the ANPS, therefore, they are only significant if it is to be argued that there should not be any decision to meet economic needs by increasing airport capacity by one of these schemes. But in light of the extensive work done by the Airports Commission about the need for such an increase in capacity it could not be said that the Secretary of State acted irrationally in considering that the case for airport expansion had been sufficiently made out to allow the designation of the ANPS. The respondents did not seek to argue that this aspect of his reasoning was irrational. As we have noted above, the concept of sustainability in section 10 of the PA 2008 includes consideration of economic and social factors as well as environmental ones. In light of the factual position, it is not necessary to decide the different question whether, if the Secretary of State had omitted to think about the Paris Agreement at all (so that this was a case of the type described in para 120 above), as an unincorporated treaty, that would have constituted an error of law. That is not a straightforward issue and we have not heard submissions on the point. We say no more about it. Ground (iii): the SEA Directive ground The SEA Directive operates along with the EIA Directive to ensure that environmental impacts from proposals for major development are properly taken into account before a development takes place. The relationship between the Directives was explained by Lord Reed in Walton v Scottish Ministers [2012] UKSC 44; [2013] PTSR 51, paras 10 30. The SEA Directive applies upstream, at the stage of preparation of strategic development plans or proposals. The EIA Directive requires assessment of environmental impacts downstream, at the stage when consent for a particular development project is sought. Although the two Directives are engaged at different points in the planning process for large infrastructure projects such as the NWR Scheme, they have similar objects and have to deal with similar issues of principle, including in particular the way in which regard should be had to expert assessment of various factors bearing on that process. These points indicate that a similar approach should apply under the two Directives. The SEA Directive is implemented in domestic law by the SEA Regulations. It is common ground that the SEA Regulations are effective in transposing the Directive into domestic law. Accordingly, it is appropriate to focus the discussion of this ground on the SEA Directive itself. The structure of the SEA Directive appears from its provisions, set out and discussed above. The Directive requires that an environmental assessment of major plans and proposals should be carried out. The ANPS is such a plan, which will have a significant effect in setting the policy framework for later consideration of whether to grant a DCO for implementing the NWR Scheme. Therefore the proposal to designate it under section 5 of the PA 2008 required an environmental assessment as defined in article 2(b). The environmental assessment had to include the preparation of an environmental report and the carrying out of consultations. An environmental report for the purposes of the Directive is directed to providing a basis for informed public consultation on the plan. The decision making framework under the SEA Directive is similar to that under the EIA Directive for environmental assessment of particular projects. Under the EIA Directive, an applicant for planning consent for particular projects has to produce an environmental statement which, among other things, serves as a basis for consultation with the public. Under the SEA Directive, the public authority which proposes the adoption of a strategic plan has to produce an environmental report for the same purpose. In due course, any application by HAL for a DCO will have to go through the process of environmental assessment pursuant to the EIA Directive and the EIA Regulations. FoE and Plan B Earth complain that the environmental report which the Secretary of State was required under the SEA Directive to prepare and publish was defective, in that it did not make reference to the Paris Agreement. Mr Wolfe pointed out that the Secretary of State did not include the Paris Agreement in the long list of legal instruments and other treaties appended to the scoping report produced in March 2016 (ie after the Paris Agreement was adopted in December 2015 but before it was signed by the UK in April 2016 and ratified by it in November 2016) for the purposes of preparing the draft AoS which was to stand as the Secretary of States environmental report for the purposes of the SEA Directive for the consultation on the draft ANPS. No reference to the Paris Agreement was included in the AoS used for the February 2017 consultation on the draft ANPS, nor in that used for the October 2017 consultation on the draft ANPS. Against this, HAL points out that the carbon target in the CCA 2008 and the carbon budgets set under that Act were referred to in the AoS, as well as in the draft ANPS itself, so to that extent the UKs obligations under the Paris Agreement were covered in the environmental report. Beyond that, the evidence of Ms Stevenson (who led the team who prepared the AoS on behalf of the Secretary of State) makes it clear that the Secretary of State followed the advice of the CCC in deciding that it was not necessary and would not be appropriate to make further reference to the Paris Agreement in the AoS. The existing domestic legal obligations were considered to be the correct basis for assessing the carbon impact of the project, and it would be speculative and unhelpful to guess at what different targets might be recommended by the CCC in the future. Therefore, despite its omission from the scoping report, when the AoS actually came to be drafted the Paris Agreement (which had been ratified by the UK after the scoping report was issued) had been considered and the Secretary of State, acting by Ms Stevenson and her team, had decided in the exercise of his discretion not to make distinct reference to it. As regards the law, the parties are in agreement. Any obligation to make further reference to the Paris Agreement in the environmental report depended on the application of three provisions of the SEA Directive. Under paragraph (e) of Annex I, the AoS had to provide information in the form of the environmental protection objectives, established at international, Community or member state level, which are relevant to the plan or programme and the way those objectives and any environmental considerations have been taken into account during its preparation. But, as stated in the introduction to Annex I, this was subject to article 5(2) and (3) of the Directive, set out at para 58 above. It is common ground that the effect of article 5(2) and (3) is to confer on the Secretary of State a discretion regarding the information to include in an environmental report. It is also common ground that the approach to be followed in deciding whether the Secretary of State has exercised his discretion unlawfully for the purposes of that provision is that established in relation to the adequacy of an environmental statement when applying the EIA Directive, as set out by Sullivan J in R (Blewett) v Derbyshire County Council [2003] EWHC 2775 (Admin); [2004] Env LR 29 (Blewett). Blewett has been consistently followed in relation to judicial review of the adequacy of environmental statements produced for the purposes of environmental assessment under the EIA Directive and endorsed at the highest level. In Shadwell Estates Ltd v Breckland District Council [2013] EWHC 12 (Admin) Beatson J held that the Blewett approach was also applicable in relation to the adequacy of an environmental report under the SEA Directive. The Divisional Court and the Court of Appeal in the present case endorsed this view (at paras 401 435 and paras 126 144 of their respective judgments). The respondents have not challenged this and we see no reason to question the conclusion of the courts below on this issue. As Sullivan J held in Blewett (paras 32 33), where a public authority has the function of deciding whether to grant planning permission for a project calling for an environmental impact assessment under the EIA Directive and the EIA Regulations, it is for that authority to decide whether the information contained in the document presented as an environmental statement is sufficient to meet the requirements of the Directive, and its decision is subject to review on normal Wednesbury principles. Sullivan J observed (para 39) that the process of requiring that the environmental statement is publicised and of public consultation gives those persons who consider that the environmental statement is inaccurate or inadequate or incomplete an opportunity to point out its deficiencies. The EIA Directive and Regulations do not impose a standard of perfection in relation to the contents of an environmental statement in order for it to fulfil its function in accordance with the Directive and the Regulations that it should provide an adequate basis for public consultation. At para 41 Sullivan J warned against adoption of an unduly legalistic approach in relation to assessment of the adequacy of an environmental statement and said: The [EIA] Regulations should be interpreted as a whole and in a common sense way. The requirement that an [environmental impact assessment] application (as defined in the Regulations) must be accompanied by an environmental statement is not intended to obstruct such development. As Lord Hoffmann said in R v North Yorkshire County Council, Ex p Brown [2000] 1 AC 397, at p 404, the purpose is to ensure that planning decisions which may affect the environment are made on the basis of full information. In an imperfect world it is an unrealistic counsel of perfection to expect that an applicants environmental statement will always contain the full information about the environmental impact of a project. The Regulations are not based upon such an unrealistic expectation. They recognise that an environmental statement may well be deficient, and make provision through the publicity and consultation processes for any deficiencies to be identified so that the resulting environmental information provides the local planning authority with as full a picture as possible. There will be cases where the document purporting to be an environmental statement is so deficient that it could not reasonably be described as an environmental statement as defined by the Regulations , but they are likely to be few and far between. Lord Hoffmann (with whom the other members the Appellate Committee agreed on this issue) approved this statement in R (Edwards) v Environment Agency [2008] UKHL 22; [2008] 1 WLR 1587, para 38. As the Divisional Court and the Court of Appeal held in the present case, the discretion of the relevant decision maker under article 5(2) and (3) of the SEA Directive as to whether the information included in an environmental report is adequate and appropriate for the purposes of providing a sound and sufficient basis for public consultation leading to a final environmental assessment is likewise subject to the conventional Wednesbury standard of review. We agree with the Court of Appeal when it said (para 136): The courts role in ensuring that an authority here the Secretary of State has complied with the requirements of article 5 and Annex I when preparing an environmental report, must reflect the breadth of the discretion given to it to decide what information may reasonably be required when taking into account the considerations referred to first, current knowledge and methods of assessment; second, the contents and level of detail in the plan or programme; third, its stage in the decision making process; and fourth the extent to which certain matters are more appropriately assessed at different levels in that process in order to avoid duplication of the assessment. These requirements leave the authority with a wide range of autonomous judgment on the adequacy of the information provided. It is not for the court to fix this range of judgment more tightly than is necessary. The authority must be free to form a reasonable view of its own on the nature and amount of information required, with the specified considerations in mind. This, in our view, indicates a conventional Wednesbury standard of review as adopted, for example, in Blewett. A standard more intense than that would risk the court being invited, in effect, to substitute its own view on the nature and amount of information included in environmental reports for that of the decision maker itself. This would exceed the proper remit of the court. The EIA Directive and the SEA Directive are, of course, EU legislative instruments and their application is governed by EU law. However, as the Court of Appeal observed (paras 134 135), the type of complex assessment required in compiling an environmental report for the purposes of environmental assessment is an area where domestic public law principles have the same effect as the parallel requirements of EU law. As Advocate General Lger stated in his opinion in Upjohn Ltd v Licensing Authority Established Under Medicines Act 1968 (Case C 120/97) [1999] 1 WLR 927, para 50, [the] court has always taken the view that when an authority is required, in the exercise of its functions, to undertake complex assessments, a limited judicial review of the action which that authority alone is entitled to perform must be exercised, since otherwise that authoritys freedom of action would be definitively paralysed . The appropriateness of this approach is reinforced in the present context, having regard to the function which an environmental report is supposed to fulfil under the scheme of the SEA Directive. It is intended that such a report should inform the public by providing an appropriate and comprehensible explanation of the relevant policy context for a proposed strategic plan or project to enable them to provide comments thereon, and in particular to suggest reasonable alternatives by which the public need for development in accordance with the proposed plan or project could be met. As article 6(2) states, the public is to have an early and effective opportunity to express their opinion on a proposed plan or programme. It is implicit in this objective that the public authority responsible for promulgating an environmental report should have a significant editorial discretion in compiling the report to ensure that it is properly focused on the key environmental and other factors which might have a bearing on the proposed plan or project. Absent such a discretion, there would be a risk that public authorities would adopt an excessively defensive approach to drafting environmental reports, leading to the reports being excessively burdened with irrelevant or unfocused information which would undermine their utility in informing the general public in such a way that the public is able to understand the key issues and comment on them. In the sort of complex environmental report required in relation to a major project like the NWR Scheme, there is a real danger that defensive drafting by the Secretary of State to include reference to a wide range of considerations which he did not consider to be helpful or appropriate in the context of the decision to be taken would mean that the public would be drowned in unhelpful detail and would lose sight of the wood for the trees, and their ability to comment effectively during the consultation phase would be undermined. The appositeness of Sullivan Js analysis in Blewett at para 41, quoted above, has been borne out in this case. The draft ANPS issued with the AoS for the purposes of consultation included the statement that it was compatible with the UKs international obligations in relation to climate change. Concerns about the impact of the expansion of Heathrow on the UKs ability to meet its climate change commitments were raised in representations made during the consultation. In the Governments response to the consultation published on 5 June 2018 these representations were noted and the Governments position in relation to them was explained (paras 8.18 8.19 and 8.25). The Governments view was that the NWR Scheme was capable of being compatible with the UKs international obligations and that there was no good reason to hold up the designation of the ANPS until future policy in relation to aviation carbon emissions, which was in a state of development internationally and domestically, was completely fixed. Accordingly, it is clear that the public was able to comment on the Paris Agreement in the course of the consultation and that their comments were taken into account in the environmental assessment required by the SEA Directive. It again appears from this material that the Secretary of State did have regard to the Paris Agreement when deciding to designate the ANPS. As we have said, Mr Wolfe did not challenge the legal framework set out above. In particular, he did not challenge the appropriateness of applying the Wednesbury standard in relation to the exercise of discretion under article 5(2) and (3). Instead, in line with his submission under ground (ii) above, his submission was that the Secretary of State had decided that the Paris Agreement was not a relevant statement of international policy falling within Annex I, paragraph (e), because he had been advised that it was legally irrelevant to the decision he had to take as to whether to designate the ANPS. Thus, according to Mr Wolfe, the Secretary of State had never reached the stage of exercising his discretion whether to include a distinct reference to the Paris Agreement in the AoS. The Secretary of States decision that the Paris Agreement was irrelevant as a matter of law was wrong, and therefore the Secretary of State had erred in law because he simply did not turn his mind to whether reference to it should be included in the environmental report (the AoS). This was the argument which the Court of Appeal accepted at paras 242 to 247. The Court of Appeals reasoning on this point was very short because, as it pointed out, it followed its reasoning in relation to the respondents submissions in relation to section 10 of the PA 2008 (ground (ii) above). In our view, as with the ground (ii) above, Mr Wolfes submission and the reasoning of the Court of Appeal cannot be sustained in light of the relevant evidence on the facts. As we have explained, the Secretary of State did not treat the Paris Agreement as legally irrelevant and on that basis refuse to consider whether reference should be made to it. On the contrary, as Ms Stevenson explains in her evidence, in compiling the AoS as the environmental statement required under the SEA Directive the Secretary of State decided to follow the advice of the CCC to the effect that the UKs obligations under the Paris Agreement were sufficiently taken into account in the UKs domestic obligations under the CCA 2008, which were referred to in the ANPS and the AoS. Further reference to the Paris Agreement was not required. As we have already held above, this was an assessment which was plainly rational and lawful. Therefore, we would uphold this ground of appeal as well. Having regard to the evidence regarding the factual position, the Divisional Court was right to reject this complaint by the respondents (paras 650 656). The Secretary of State did not act in breach of any of his obligations under the SEA Directive in drafting the AoS as the relevant environmental report in respect of the ANPS, and in omitting to include any distinct reference in it to the Paris Agreement. Ground (iv) the post 2050 and non CO emissions grounds This ground concerns other matters which it is said that the Secretary of State failed to take into consideration in the performance of his duty under section 10(2) and (3) of the PA 2008. Those provisions, as we have said, obliged the Secretary of State in performing his function of designating the ANPS to do so with the objective of contributing to sustainable development and in so doing to have regard to the desirability of mitigating, and adapting to, climate change. FoE has argued and the Court of Appeal (paras 248 260) has accepted that the Secretary of State failed in his duty under section 10 to have regard to (i) the effect of emissions created by the NWR Scheme after 2050 and (ii) the effect of non CO emissions from that scheme. The Divisional Court dealt with this matter together with the matter which has become ground (ii) in this appeal, namely whether the Secretary of State failed to have regard to the Paris Agreement in breach of section 10, as issue 19 in the rolled up hearing (paras 633 648, 659(iv)) and held that that FoEs case was not arguable. The Court of Appeal (para 256) correctly treated this issue as closely bound up with what is now ground (ii) in this appeal. It is not in dispute in this appeal that in assessing whether the Secretary of State was bound to address the effect of the post 2050 emissions and the effect of the non CO emissions in the ANPS we are dealing with the third category of considerations in Simon Brown LJs categorisation in R v Somerset County Council, Ex p Fewings (para 116 above). The Secretary of State had a margin of appreciation in deciding what matters he should consider in performing his section 10 duty. It is also not in dispute that it is appropriate to apply the Wednesbury irrationality test to that decision (para 119 above). The task for the court therefore is one of applying that legal approach to the facts of this case. We address first the question of post 2050 emissions before turning to the non CO emissions. (i) post 2050 emissions FoEs argument on the relevance to the objectives of the Paris Agreement of the impacts of emissions after 2050 was straightforward. An assessment of the impact of the emissions from aircraft using the North West Runway by reference to a greenhouse gas target for 2050 fails to consider whether it would be sustainable for the additional aviation emissions from the use of the North West Runway to occur after 2050 given the goal of the Paris Agreement for global emissions to reach net zero in the second half of the century. HAL submitted that the Secretary of States approach is entirely rational. Lord Anderson points out, and FoE accepts, that the Airports Commission assessed the carbon emissions of each of the short listed schemes over a 60 year appraisal period up to 2085/2086 and that the same appraisal period was used in the AoS which accompanied the ANPS. The Secretary of State therefore did take into account the fact that there would be carbon emissions from the use of the North West Runway after 2050 and quantified those emissions. It was not irrational to decide not to attempt to assess post 2050 emissions by reference to future policies which had yet to be formulated. It was rational for him to assume that future policies in relation to the post 2050 period, including new emissions targets, could be enforced by the DCO process and mechanisms such as carbon pricing, improvements to aircraft design, operational efficiency improvements and limitation of demand growth. In our view, HAL is correct in its submission that the Secretary of State did not act irrationally in not attempting in the ANPS to assess post 2050 emissions against policies which had yet to be determined. It is clear from the AoS that the Department for Transport modelled the likely future carbon emissions of both Heathrow and Gatwick airports, covering aircraft and other sources of emissions, to 2085/2086 (paras 6.11.1 6.11.3, 6.11.13 and Table 6.4). As we have set out in our discussion of ground (i) above, policy in response to the global goals of the Paris Agreement was in the course of development in June 2018 when the Secretary of State designated the ANPS and remains in development. Further, as we have already pointed out (paras 10 and 98 above), the designation of the NWR Scheme in the ANPS did not immunise the scheme from complying with future changes of law and policy. The NWR Scheme would fall to be assessed against the emissions targets which were in force at the date of the determination of the application for a DCO. Under section 120 of the PA 2008 (para 37 above) the DCO may impose requirements corresponding to planning conditions and requirements that the approval of the Secretary of State be obtained. Under section 104 (para 35 above), the Secretary of State is not obliged to decide the application for the DCO in accordance with the ANPS if (i) that would lead the United Kingdom to be in breach of any of its international obligations, (ii) that would lead the Secretary of State be in breach of any duty imposed by or under any other enactment, (iii) the Secretary of State is satisfied that deciding the application in accordance with the ANPS would be unlawful by virtue of any enactment and (iv) the Secretary of State is satisfied that the adverse impact of the proposed development would outweigh its benefits. There are therefore provisions in place to make sure that the NWR Scheme complies with law and policy, including the Governments forthcoming Aviation Strategy, at the date when the DCO application is determined. There are also mechanisms available to the Government, as HAL submits (para 155 above), by which the emissions from the use of the North West Runway can be controlled. (ii) non CO emissions To understand FoEs argument in relation to non CO emissions, it is necessary first to identify what are the principal emissions which give rise to concern. Mr Tim Johnson, of the Aviation Environmental Federation, explained in his first witness statement that aircraft emit nitrogen oxides, water vapour and sulphate and soot aerosols, which combine to have a net warming effect. Depending on atmospheric humidity, the hot air from aircraft exhausts combines with water vapour in the atmosphere to form ice crystals which appear as linear condensation trails and can lead to cirrus like cloud formation. Using the metric of radiative forcing (RF), which is a measure of changes in the energy balance of the atmosphere in watts per square metre, it is estimated that the overall RF by aircraft is 1.9 times greater than the forcing by aircraft CO emissions alone, but the RF metric is not suitable for forecasting future impacts. He recognised that there is continuing uncertainty about the impacts of non CO emissions, which tend to be short lived, but he stated that there is high scientific consensus that the total climate warming effect of aviation is more than that from CO emissions alone. Scientists are exploring metrics to show how non CO impacts can be reflected in emission forecasts for the purpose of formulating policy. There is substantial agreement between the parties that there is continuing uncertainty in the scientific community about the effects of non CO emissions. The Department for Transport acknowledged this uncertainty in the AoS (para 6.11.11): The assessment undertaken is based on CO emissions only There are likely to be highly significant climate change impacts associated with non CO emissions from aviation, which could be of a similar magnitude to the CO emissions themselves, but which cannot be readily quantified due to the level of scientific uncertainty and have therefore not been assessed. There are also non CO emissions associated with the operation of the airport infrastructure, such as from refrigerant leaks and organic waste arisings, however, evidence suggests that these are minor and not likely to be material. The AoS returned to this topic (Appendix A 9, para 9.11.5): In addition, there are non carbon emissions associated with the combustion of fuels in aircraft engines while in flight, which are also thought to have an impact on climate change. As well as CO, combustion of aviation fuel results in emission of water vapour, nitrogen oxides (NO) and aerosols. NO are indirect greenhouse gases, in that they do not give rise to a radiative effect themselves, but influence the concentration of other direct greenhouse gases With the exception of sulphate aerosols, all other emissions cause warming. In addition, the flight of aircraft can also cause formation of linear ice clouds (contrails) and can lead to further subsequent aviation induced cloudiness. These cloud effects cause additional warming. Evidence suggests that the global warming impact of aviation, with these sources included, could be up to two times that of the CO impact by itself, but that the level of scientific uncertainty involved means that no multiplier should be applied to the assessment. For these reasons the [Airports Commission] did not assess the impact of the non CO effects of aviation and these have not been included in the AoS assessment. This position is kept under review by DfT but it is worth noting that non CO emissions of this type are not currently included in any domestic or international legislation or emissions targets and so their inclusion in the assessment would not affect its conclusion regarding legal compliance. It is recommended that further work be done on these impacts by the applicant during the detailed scheme design, according to the latest appraisal guidance. (Emphasis added) This approach of addressing the question of capacity by reference to CO emissions targets, keeping the policy in relation to non CO emissions under review and requiring an applicant for a DCO to address such impacts by reference to the state of knowledge current at the time of the determination of its application was consistent with the advice of the CCC to the Airports Commission and to the Secretary of State. The Airports Commission recorded that advice in its interim report in December 2013: because of the uncertainties in the quantification of the impact of non CO emissions, the target for constraining CO emissions remained the most appropriate basis for planning future airport capacity. The approach of reconsidering the effect of all significant emissions when determining an application for a DCO is reflected in the ANPS which addressed the CO emissions target and stated (para 5.76): Pursuant to the terms of the Environmental Impact Assessment Regulations, the applicant should undertake an assessment of the project as part of the environmental statement, to include an assessment of any likely significant climate factors. The applicant should quantify the greenhouse gas impacts before and after mitigation to show the impacts of the proposed mitigation. (Emphasis added) The approach remains consistent with the CCCs advice since the designation of the ANPS. In its letter of 24 September 2019 to the Secretary of State recommending that international aviation and shipping emissions be included in a net zero CO emissions target, the CCC stated: Aviation is likely to be the largest emitting sector in the UK by 2050, even with strong progress on technology and limiting demand. Aviation also has climate warming effects beyond CO, which it will be important to monitor and consider within future policies. (Emphasis added) The Government in its response to consultations on the ANPS (para 11.50) stated that it will address how policy might make provision for the effects of non CO aviation emissions in its Aviation Strategy. That strategy is due to be published shortly. The Secretary of State when he designated the ANPS was aware that the applicant for a DCO in relation to the NWR Scheme would have to provide an environmental assessment which addressed, and would be scrutinised against, the then current domestic and international rules and policies on aviation and other emissions. He would have been aware of his power to make requirements under section 120 of the PA 2008 and to depart from the ANPS in the circumstances set out in section 104 of that Act (para 157 above). The Court of Appeal (para 258) upheld FoEs challenge stating the precautionary principle and common sense suggested that scientific uncertainty was not a reason for not taking something into account at all, even if it could not be precisely quantified at this stage. The Court did not hold in terms that the Secretary of State had acted irrationally in this regard but said (para 261) that, since it was remitting the ANPS to the Secretary of State for reconsideration, the question of non CO emissions and the effect of post 2050 emissions would need to be taken into account as part of that exercise. We respectfully disagree with that approach. The precautionary principle adds nothing to the argument in this context and we construe the judgment as equating the principle with common sense. But a courts view of common sense is not the same as a finding of irrationality, which is the only relevant basis on which FoE seeks to impugn the designation in its section 10 challenges. In any event we are satisfied that the Secretary of States decision to address only CO emissions in the ANPS was not irrational. In summary, we agree with the Divisional Court that it is not reasonably arguable that the Secretary of State acted irrationally in not addressing the effect of the non CO emissions in the ANPS for six reasons. First, his decision reflected the uncertainty over the climate change effects of non CO emissions and the absence of an agreed metric which could inform policy. Secondly, it was consistent with the advice which he had received from the CCC. Thirdly, it was taken in the context of the Governments inchoate response to the Paris Agreement. Fourthly, the decision was taken in the context in which his department was developing as part of that response its Aviation Strategy, which would seek to address non CO emissions. Fifthly, the designation of the ANPS was only the first stage in a process by which permission could be given for the NWR Scheme to proceed and the Secretary of State had powers at the DCO stage to address those emissions. Sixthly, it is clear from both the AoS and the ANPS itself that the applicant for a DCO would have to address the environmental rules and policies which were current when its application would be determined. Conclusion It follows that HAL succeeds on each of grounds (i) to (iv) of its appeal. It is not necessary therefore to address ground (v) which is concerned with the question whether the court should have granted the relief which it did. We would allow the appeal.

This appeal concerns the lawfulness of the Airports National Policy Statement (the ANPS) and its accompanying environmental report. The ANPS is the national policy framework which governs the construction of a third runway at Heathrow Airport. Any future application for development consent to build this runway will be considered against the policy framework in the ANPS. The ANPS does not grant development consent in its own right. Successive governments have considered whether there is a need for increased airport capacity in the South East of England. The Secretary of State for Transport (the Secretary of State) declared that the Government accepted the case for airport expansion in 2015. He announced that the North West Runway (NWR) scheme was the preferred scheme in October 2016. The UK was separately developing its policy on environmental issues and climate change. On 22 April 2016 the UK signed the Paris Agreement under the United Nations Framework Convention on Climate Change (the Paris Agreement). The UK ratified the agreement on 17 November 2016. The agreement sets out various targets for the reduction of greenhouse gas emissions, particularly carbon dioxide, and the reduction of temperature increases resulting from global warming (the Paris Agreement Targets). Two Government ministers Andrea Leadsom MP and Amber Rudd MP made statements about the Governments approach to the Paris Agreement in March 2016. Against this background, the Secretary of State designated the ANPS as national policy on 26 June 2018. Objectors to the NWR scheme, including Friends of the Earth Ltd (FoE) and Plan B Earth, challenged the lawfulness of the Secretary of States designation on a number of grounds. The Divisional Court dismissed all of the objectors various claims in two separate judgments. The Court of Appeal upheld the main parts of these judgments on appeal but allowed some of FoE and Plan B Earths grounds. It held the Secretary of State had acted unlawfully in failing to take the Paris Agreement into account when designating the ANPS. Accordingly, the ANPS was of no legal effect. The Secretary of State does not appeal the Court of Appeals decision. However, the company which owns Heathrow Airport, Heathrow Airport Ltd (HAL), is a party to the proceedings and has been granted permission to appeal to the Supreme Court. HAL has stated that it has already invested a large sum of money in promoting the NWR scheme and wishes to make an application for development consent to carry the project through. The Supreme Court unanimously allows the appeal. Lord Hodge and Lord Sales give the main judgment (with which Lord Reed, Lady Black and Lord Leggatt agree). Government policy The Secretary of State designated the ANPS under section 5(1) of the Planning Act 2008 (the PA 2008) [12]. Section 5(7) of the PA 2008 provides that national policy frameworks such as the ANPS must give reasons for the policy adopted. Section 5(8) states that these reasons must include an explanation of how that policy takes account of existing Government policy relating to the mitigation of and adaptation to climate change [25]. The Court rejects Plan B Earths argument that the reasons in the ANPS needed to refer to the Paris Agreement Targets in order to comply with section 5(8). The March 2016 statements of Andrea Leadsom MP and Amber Rudd MP and the formal ratification of the Paris Agreement do not mean that the Governments commitment to the Paris Agreement constitutes Government policy in the sense in which that term is used in the statute [102]. The meaning of Government policy is a matter of interpretation of the statutory provision [101]. The phrase needs to be construed relatively narrowly in context to allow section 5(8) to operate sensibly. Otherwise it would create a bear trap for civil servants and ministers, who would have to consider all ministerial statements given in any context which might be characterised as policy in a broad sense [105]. The Court explains that Government policy in the context of section 5(8) refers to carefully formulated written statements of policy which have been cleared by the relevant departments on a Government wide basis [105]. The epitome of Government policy is a formal written statement of established policy. The absolute minimum standard is a statement which is clear, unambiguous, and devoid of relevant qualification [106]. The Court does not consider that the statements of Andrea Leadsom MP and Amber Rudd MP meet this minimum standard. They were not clear, did not refer to the Paris Temperature Targets at all, and did not explain how the Paris Agreement goal of net zero emissions would be incorporated into UK law [106]. The lower courts were asked to consider whether international treaties which have been formally ratified but have not been incorporated into domestic law such as the Paris Agreement are Government policy. FoE and Plan B Earth did not maintain that argument in the Supreme Court. As the Court explains, international treaties are binding only as a matter of international law and do not have an effect in domestic law. Treaty commitments continue whether or not a particular Government remains in office and do not constitute a statement of Government policy for the purposes of domestic law [108]. Section 1 of the Climate Change Act 2008 (the CCA 2008) sets a national carbon target. Section 4 obliges the Government to establish carbon budgets for the UK [6]. These are already more demanding than the limits which the UK is currently obliged to have in place under the Paris Agreement [71]. The Court holds that, at the point the ANPS was designated in June 2018, there was no established Government policy on climate change beyond that already reflected in the CCA 2008 [111]. Sustainable development Section 10(2) and (3) of the PA 2008 requires the Secretary of State to designate national policy frameworks with the aim of contributing to the achievement of sustainable development. He has to take into account the environmental, economic and social objectives that make up sustainable development. He must, in particular, have regard to the desirability of mitigating and adapting to climate change [26],[115]. The Court dismisses FoEs argument that the Secretary of State breached this duty on the ground that he failed to have proper regard to the Paris Agreement when designating the ANPS. The evidence shows that the Secretary of State took the Paris Agreement into account and, to the extent that its obligations were already covered by the measures in the CCA 2008, ensured that these were incorporated into the ANPS framework [123] [125]. Insofar as the Paris Agreement might in future require steps going beyond the current measures in the CCA 2008, the Secretary of State took it into account but decided that it was not necessary to give it further weight in the ANPS [126],[129]. The weight to be given to a particular consideration is a matter which falls within the discretion of the decision maker, in this case the Secretary of State. His exercise of discretion is lawful unless the decision made is so unreasonable that no reasonable decision maker would have made it [121]. That could not be said to be the case here [128]. The ANPS was carefully structured to ensure that when HAL applied for development consent to construct the runway, it would have to show at that stage that the development would be compatible with the up to date requirements under the Paris Agreement and the CCA 2008 measures as revised to take account of those requirements [87] [89], [123] [124]. Post 2050 and non CO emissions The Court dismisses FoEs argument that the Secretary of State separately breached his section 10 duty by failing to have regard to, firstly, the effect of greenhouse gas emissions created by the NWR scheme after 2050 and, secondly, the effect of non CO emissions [151],[156],[166]. The UKs policy in respect of the Paris Agreements global goals, including the post 2050 goal for greenhouse gas emissions to reach net zero, was in the course of development in June 2018 [154]. The Secretary of State did not act irrationally in deciding not to assess post 2050 emissions by reference to future policies which had yet to be formulated [155]. The Secretary of States department was also still considering how to address the effect of non CO emissions in June 2018 [166]. The Court further holds that future applications for development consent regarding the NWR scheme will be assessed against the emissions targets and environmental policies in force at that later date rather than those set out in the ANPS [157], [166]. Environmental report Section 5(3) of the PA 2008 requires the Secretary of State to produce an appraisal of sustainability in respect of frameworks such as the ANPS [28]. This is also required by EU law. Council Directive 2001/42/EC of 27 June 2001 (the SEA Directive) as transposed into domestic law by the Environmental Assessment of Plans and Programmes Regulations 2004 (SI 2004/1633), requires the Secretary of State to produce an environmental report in respect of major plans and proposals such as the ANPS [28]. The report must include information about relevant environmental protection objectives established at the international, EU or domestic level and the way that they have been taken into account during the preparation of the plan as may reasonably be required (Article 5 and Annex I to the SEA Directive) [57],[58]. The appraisal of sustainability accompanying the ANPS was intended to meet both the domestic and EU requirements for an appraisal of sustainability and environmental report respectively. The Court dismisses the respondents complaint that the appraisal of sustainability accompanying the ANPS was defective because it did not refer to the Paris Agreement [139]. Emphasising that the purpose of these reports is to provide the basis for informed public consultation [137], it holds that an unduly legalistic approach should not be taken when assessing their adequacy [143]. Whether a report provides a sound and sufficient basis for public consultation is a matter that falls within the Secretary of States discretion and the exercise of this discretion will only be found unlawful if it is one that no reasonable decision maker would have made [144]. Were this discretion removed, public authorities might adopt an excessively defensive and counterproductive approach by including so much detail that the public would be unable to comment effectively, contrary to the object of the SEA Directive [146]. In this instance, the targets set out in the CCA 2008, which were referred to in the appraisal of sustainability, took the UKs obligations under the Paris Agreement sufficiently into account [149]. The Court therefore upholds this ground of appeal as well [150].

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The appellant was questioned at an airport under Schedule 7 to the Terrorism Act 2000 (TA 2000), which requires a person in her position to answer questions asked by police officers, immigration officers and customs officers for the purpose there set out. She refused to answer the questions and was subsequently convicted of the offence of wilfully failing to do so, contrary to paragraph 18 of that Schedule. Her appeal against her conviction raises the issue whether Schedule 7 is compatible with the European Convention for the Protection of Human Rights and Fundamental Freedoms (ECHR), and in particular with articles 8 (right to respect for private and family life), 5 (right to liberty) and 6 (privilege against self incrimination). The statutory power Schedule 7 of TA 2000 has been somewhat amended, by the Anti Social Behaviour, Crime and Policing Act 2014 (the 2014 Act), since the date when the appellant was questioned, but the issues of compatibility remain substantially the same. Since the argument before this court has in effect been concerned with its future application as well as with the appellants particular case, it is convenient to set out the statute in its present form, unless necessary to draw attention to any change which has been made. material, it provides: Paragraph 2 of Schedule 7 creates the power which was exercised. So far as 2(1) An examining officer may question a person to whom this paragraph applies for the purpose of determining whether he appears to be a person falling within section 40(1)(b). (2) This paragraph applies to a person if (a) he is at a port or in the border area, and (b) the examining officer believes that the person's presence at the port or in the area is connected with his entering or leaving Great Britain or Northern Ireland or his travelling by air within Great Britain or within Northern Ireland. (3) This paragraph also applies to a person on a ship or aircraft which has arrived at any place in Great Britain or Northern Ireland (whether from within or outside Great Britain or Northern Ireland). (4) An examining officer may exercise his powers under this paragraph whether or not he has grounds for suspecting that a person falls within section 40(1)(b). The statutory purpose for which the questions may be asked is thus for determining whether the person questioned appears to fall within section 40(1)(b). That in turn defines terrorist for the purposes of the Act, and does so in these terms: (1) In this Part terrorist means a person who (a) has committed an offence under any of sections 11, 12, 15 to 18, 54 and 56 to 63, or (b) is or has been concerned in the commission, preparation or instigation of acts of terrorism. So the statutory purpose for which the questions may be asked is for determining whether the person appears either to be, or to have been, concerned in the commission, preparation or instigation of acts of terrorism. Terrorism is defined for the purposes of the Act in section 1. Shorn of inessential detail it means the use or threat of action which meets all of three conditions: (1) it must be done for the purpose of advancing a political, religious, racial or ideological cause, (2) it must be designed to influence the government or an international governmental organisation or to intimidate the public and (3) it must involve serious violence to a person or to property, danger to life or serious risk to public health or the risk of serious interference with an electronic system. Acts of terrorism are therefore to be construed as acts or omissions having these characteristics. Whilst the statute creates some new offences, most acts of terrorism once committed will in any event constitute long established criminal offences such as murder, infliction of grievous bodily harm, criminal damage, explosives offences or the like. The TA 2000 is largely concerned with the essential process of counter terrorism, much of which is preventative in character. Part II deals with the proscription of terrorist organisations. Part III prohibits fund raising for terrorist purposes and makes provision for the disclosure of terrorist property. Part IV contains provisions for terrorist investigations, which are not confined to inquiry into known criminal acts which have already occurred but, clearly necessarily, extend to planned or prospective acts, including the commission, preparation or instigation of acts of terrorism. It is within Part IV that Schedule 7, containing the power now under consideration, is given effect. Schedule 7 is headed Port and Border Controls. It follows that what Schedule 7 paragraph 2 does is to create a power to stop and to question people passing through ports or borders in order to see whether they appear to be terrorists in the sense defined by section 40(1)(b), that is to say whether they are or have been concerned in the commission, preparation or instigation of acts of terrorism. This core power to question is supplemented by subsequent provisions of Schedule 7 which give the officer additional powers in relation to a person questioned under paragraph 2. These are as follows: (i) (ii) (iii) (iv) to stop; under paragraph 6 the officer may stop the person in order to question him; to require production of documents carried; under paragraph 5 the person questioned must give the officer any information in his possession which the officer requests, provide his passport or other document verifying his identity, and hand over any document requested if he has it with him; to search; under paragraph 8 the person may be searched, an intimate search is not permitted and a strip search is allowed only when there are reasonable grounds for suspecting concealment of something which may be evidence that the individual falls within section 40(1)(b), and then only on the authority of a second and senior officer; to copy and retain material; paragraph 11 (and now paragraph 11A (inserted by the 2014 Act)) contain provisions for the retention of material handed over or found; this includes power to copy and retain electronic data contained on any device carried, the detail of which it will be necessary to consider later; (v) to detain; under paragraph 6 (and now paragraph 6A (inserted by the 2014 Act)) the officer may detain the person, for the purpose of exercising the questioning power under paragraph 2; by paragraph 6A he may not continue the questioning beyond one hour without invoking the more formal rules which attend detention; these are found in separate provisions in both Schedule 7 and Schedule 8 and include regular reviews by a different officer senior to the examining officer; it is necessary to note that at the time of the appellants questioning this power to detain was limited to nine hours, but now it is limited to six hours (the latter including the first hour). The sanction in the event that the person stopped wilfully fails to comply with the obligations of Schedule 7 is conviction of a specific offence created by paragraph 18. That paragraph provides: (1) A person commits an offence if he (a) wilfully fails to comply with a duty imposed under or by virtue of this Schedule; (b) wilfully contravenes a prohibition imposed under or by virtue of this Schedule; or (c) wilfully obstructs, or seeks to frustrate, a search or examination under or by virtue of this Schedule. The penalty available is a fine and/or imprisonment with a maximum of three months, together of course with the generally available lesser penalties of discharge or community orders; an amendment passed in 2003 to increase the maximum imprisonment to 51 weeks has never been brought into force. These statutory powers are supplemented by a Code of Practice for officers exercising them, issued by the Home Secretary under Schedule 14 paragraph 6, laid before Parliament, published generally and available wherever the powers may be exercised. This power of questioning, and its associated provisions, is separate from the general power to arrest, detain and question persons who are reasonably suspected of having committed an offence, and, in the context of terrorism, from the specific power to arrest on reasonable suspicion of having been concerned in the commission, preparation or instigation of an act of terrorism. That latter separate power is provided for by section 41 and different consequential provisions are made by Schedule 8 for the conduct of detention which is consequent upon such an arrest. The power in issue in the present case is a preliminary power of inquiry in aid of the prevention of terrorism. It is not dependent on the existence of any reasonable suspicion of either a past offence or act of terrorism or a plan to commit such in future. It is expressly provided in order to assist officers stationed at ports and borders to make counter terrorism inquiries of any person entering or leaving the country. If such inquiries lead to a reasonable suspicion of terrorism or offence then the different provisions appropriate to such a case become operative. The appellants case The appellant Mrs Beghal passed through East Midlands Airport on 4 January 2011. She was returning from Paris where she had visited her husband, who is a French national in custody, so the courts have been told in this litigation, in relation to terrorist offences. (The court was given no further information about him.) She was accompanied by her three children. She was not arrested and was told that whilst the police did not presently suspect her of being a terrorist they needed to speak to her in order to establish whether or not she was a person concerned in the commission, preparation or instigation of acts of terrorism. Someone was meeting her, so her two older children continued through to the land side of the airport to join that person. She elected to keep the youngest with her. She asked to consult with a lawyer. She requested an opportunity to pray, which was granted, and whilst she did so one of the officers contacted her lawyer. She was permitted to speak to him on the telephone. In the meantime she was searched. The police officers made it clear that the questions would not await the arrival of the lawyer, and proceeded to ask them. The questions concerned, inter alia, (i) her reasons for travel, (ii) where she had stayed, (iii) whether she had travelled on beyond France, (iv) the identity of the person meeting her, (v) whether she had been arrested in the past, (vi) her relationship with her husband given his imprisonment for terrorism, (vii) whether she was employed or supported by benefits, (viii) how she had paid for the flight, (ix) whether she had a motor car, (x) the details of her parents and siblings, (xi) her nationality status, (xii) how long she had lived in England and (xiii) whether she was carrying a mobile telephone. She was not formally detained. She remained at the airport. Including arrangements for the children, time for prayer (approximately 20 minutes) and time to find and speak to her solicitor, the process appears to have lasted about an hour and three quarters from her being stopped to her being told that she was free to go. The questions, plus reporting her for the failure to answer them, lasted a little under half an hour. She refused to answer most of the questions. She was charged with the offence of wilful failure to comply with the requirement to answer questions. In due course, after an unsuccessful application to the District Judge to stay the proceedings as an abuse of process, she pleaded guilty to the offence of wilfully failing to answer questions asked under Schedule 7 paragraph 2. She was sentenced to be conditionally discharged. History of the power Although now contained in the TA 2000, the power to question at ports and borders in relation to possible terrorism has been in existence in the UK for 40 years. It was amongst powers introduced, initially as temporary measures, by the Prevention of Terrorism (Temporary Provisions) Act 1974, which was passed in response to the then threat of IRA terrorism and the bombing campaigns associated with it. Terrorism legislation has been subject to almost continuous scrutiny ever since. Other powers introduced by the 1974 Act have not survived, notably a power for the Secretary of State, of his own motion, to remove from Great Britain, and thereafter to exclude, any person he was satisfied was a terrorist, even UK citizens unless they were long term residents. But the power to question at ports and borders has been re enacted at regular intervals since 1974. It was re enacted annually until 1984, and then replaced by the Prevention of Terrorism (Temporary Provisions) Act of that year. That in turn was replaced by the Prevention of Terrorism (Temporary Provisions) Act 1989, which itself was renewed annually until replaced by the TA 2000. Quite apart from the examination involved in repeated Parliamentary re enactment, there have been both specific inquiries and continuous review. A review of the then new 1974 Act was undertaken shortly afterwards by Lord Shackleton (Review of the operation of the Prevention of Terrorism (Temporary Provisions) Acts 1974 and 1976 (Cmnd 7324), August 1978). A further wholesale independent inquiry into terrorism legislation was undertaken in 1995 1996 by Lord Lloyd of Berwick, then, as a Law Lord, one of the UKs most senior judges (Inquiry into Legislation Against Terrorism (Cm 3420), October 1996). The occasion for his review was the then current hope for a peaceful accord in Northern Ireland, and he reported on the situation as it might be if that occurred; the prospect was subsequently confirmed by the Good Friday Agreement of 1998. The government then conducted a public consultation on terrorist legislation in 1998. More recently, in 2012 2013, the government undertook a further public consultation specifically in relation to the Schedule 7 powers and, independently of any tabled legislative proposal, the joint committee on human rights of the Houses of Parliament then examined the powers in 2013 and produced a public report. In addition to those specific inquiries, there has been in existence since 1984 the office of Independent Reviewer of terrorism legislation, currently pursuant to section 36 of the Terrorism Act 2006. The reviewers have been distinguished independent lawyers, charged with reporting at least annually on the structure and working of the legislation. Their reports must be laid before Parliament and thus the public. Lord Lloyd, successive Independent Reviewers, and the joint committee have all advised that the port questioning power should remain, in some cases with suggested modifications, some of which have been made. The power to detain was originally limited to 12 hours. It was reduced to nine hours in 1998 after Lord Lloyd had suggested a six hour limit. It was further reduced to the present six hours by the 2014 Act, following the 2012 2013 consultation. At the same time other alterations were made to the Schedule 7 powers by Schedule 9 to the 2014 Act: (i) searches were confined to non intimate searches, with the restrictions on strip searches described above introduced (para 8(3) to (7)); the power to take blood and urine samples was removed; (ii) (iii) a person detained was ensured the right to have a third person informed, when detained at the port as well as if taken to a police station (Schedule 8 paragraph 6(1)) (iv) similarly all persons detained were ensured the right to consult a solicitor, and the questioning is now to be postponed until his arrival unless that would prejudice the inquiry being made (Schedule 8 paragraph 7A); (v) A new requirement for periodic review of detention by a senior officer (vi) was introduced (Schedule 8, Part 1A); and the power to retain documents or data was supplemented by a specific power to copy them, with the same limit to seven days or during a criminal or deportation inquiry. The Code of Practice The current Code of Practice was issued in 2014. Amongst its provisions are the following: (i) examining officers must be specially trained and authorised for the purpose and must normally be police officers; an immigration or customs officer is in effect to be used only exceptionally and when specifically designated by the Secretary of State after consultation with the chief officer of police on both his training and the proposal for his designation (paras 8 to 13); (ii) officers are advised that it will often be helpful to ask initial screening questions without compulsion and that this may avoid the need for the exercise of Schedule 7 powers (para 20); (iii) emphasis is placed upon the need to avoid discrimination and/or arbitrary action, by selecting persons only for the statutory purpose; selection must not be based solely upon the ethnic background or religion of the individual but rather must be informed by considerations relating to the threat of terrorism (paras 18 19); (v) (iv) persons questioned must be informed clearly of the statutory basis for what is being done and of the procedure for feedback or complaint (para 22); if a person questioned but not detained asks to notify a third party and/or to consult a solicitor, these requests should be granted (paras 41 42); records must be kept of the fact and duration of each examination and detention and, from April 2015 when the equipment will be in place, examinations of those in detention must be audio recorded (paras 43 and 66 68); (vi) (vii) guidance is given as to when it may be appropriate to exercise the power of detention; essentially this will be when detention is made necessary by lack of co operation; officers are instructed that if questioning is to last longer than an hour, formal detention must take place before the hour elapses (paras 45 46). Use of the power The Independent Reviewers have set out the use of, inter alia, the Schedule 7 powers. In 2013 there were approximately 245m passenger movements through the ports of the UK. In 2012 2013, 61,145 were examined under Schedule 7, and in 2013 2014 47,350 were. Others were asked screening questions, but these entailed the use of no compulsory powers. It follows that the proportion of passengers examined under compulsion was between 0.02% and 0.025%, or between 1 in 4,000 and 1 in 5,000. Of the 47,350 examined in 2013 2014, before a decision on detention was required to be made within the first hour, all but 1,889 were dealt with within that time and only 517 were detained (a fraction over 1% of those examined or very roughly 1 in 500,000 passengers). The Reviewers reports show that the numbers examined have been falling steadily over the past five years. The Reviewers themselves, whilst concluding that the Schedule 7 questioning power should be retained, have consistently counselled against its over use, and have not detected such. They have also reported favourably on the manner in which they have observed the power being exercised. The independent reviewer: recent reports There has been broad consensus over recent years in the conclusions of successive Independent Reviewers as to the Schedule 7 powers. It will suffice to refer to the most recent reports of David Anderson QC. These reports make clear the conclusion that the presence of a port questioning and search power which does not require prior objectively established suspicion on reasonable grounds has undoubted utility in the struggle against terrorism. The June 2012 report sets out these conclusions at para 9.43ff, and subsequent reports make clear that they still hold good. The questioning and search powers are found to have three principal values and one ancillary one: (a) (b) (c) (d) in providing evidence which assists in the conviction of terrorists; in furnishing intelligence about the terrorist threat; in disrupting and deterring terrorist activity; and, as an ancillary benefit; in enabling the recruitment of informants. The principal source of evidence subsequently used either in evidence or in investigations leading to conviction is material found on persons questioned, especially the contents of mobile telephones, laptops or data storage devices such as pen drives. The Reviewer catalogued five different examples, over a four year period, of convictions deriving from evidence produced from the exercise of Schedule 7 powers. Even more potent, the Reviewer concluded, has been the gathering of valuable intelligence. Sometimes this may trigger a train of inquiry which leads directly to a prosecution; on far more occasions it is the accumulation of individually small pieces of intelligence which, combined, may inform both particular and general responses to the terrorist threats confronting this country. It is a commonplace of detective or security work that a jigsaw approach can yield vital results beyond the significance initially apparent from any single piece of information. The Reviewer has satisfied himself that port checks can help to dissuade young, nervous or peripheral members of terrorist networks from their plans. Stops not based on intelligence can help to inhibit the use of clean skins or persons selected for their absence of any prior known connection with terrorism. The knowledge of port stops can help to disrupt plans which involve international travel. The Reviewer has attended training sessions for examining officers and has watched them at work. His conclusion is that the examinations he saw were non confrontational, considerate and no longer than necessary (June 2012 report, para 9.61). He comments specifically on being struck by the light touch and professionalism displayed by nearly all the ports officers observed. (ibid para 9.58). In his June 2014 report Mr Anderson expressly considered the potential for ethnically discriminatory use of these powers. The Strasbourg court had adverted in Gillan v United Kingdom (2010) 50 EHRR 1105 to this potential in the context of the different powers there studied (see below), and the Equality and Human Rights Commission had addressed the same issue, as it helpfully has before this court. The Reviewer found that there was a significantly higher incidence of the use of Schedule 7 powers in relation to persons of Asian origin than there was for those of white, black or other origin. He made adjustments for the lower proportion of Asian persons travelling through ports than in the population generally, but there remained a clearly greater use of the powers in the case of such persons. He concluded that if Schedule 7 were intended to be operated on a random basis, this would be worrying, but that since the powers were, as required by the Code, to be operated having regard to the nature of the terrorist threat confronted by this country, this was, in conditions of the present threat, inevitable and indeed an indication that the Schedule was being properly used. His conclusion was expressed at paras 7.11 and 7.14 as follows: If Schedule 7 is being skilfully used, therefore, one would expect its exercise to be ethnically proportionate not to the UK population, nor even to the airport using population, but rather to the terrorist population that travels through UK ports. I have no reason to believe that Schedule 7 powers are exercised in a racially discriminatory manner. The so called disproportionality identified by the EHRC is not evidence (and not suggested to be evidence) of this. What matters is that Schedule 7 should be operated responsively to the terrorist threat. The ethnicity figures are not indicative of a failure to do this. The Reviewer made several recommendations for changes in Schedule 7. To the extent that these have been adopted either by statute or the Code (see paras 16 and 17 above) they need not be further rehearsed. He also made recommendations which have not been adopted, the principal of which were as follows (July 2014 report, paras 19ff): (a) (b) (c) that detention should be permitted only when a senior officer is satisfied that there are (subjectively judged) grounds for suspicion that the person falls within section 40(1)(b); that a similar condition should govern the copying and retention of data downloaded from electronic devices; and that a statutory bar be introduced on the admission of anything said in a Schedule 7 interview in any subsequent criminal trial. The different powers In analysing the lawfulness of Schedule 7 it is convenient to break them down into (a) the power of port questioning and search, (b) the power of detention and (c) the power to inspect data on any electronic device carried and to copy and retain that data. Port questioning and search: article 8 There was, rightly, no dispute before us that Schedule 7 questioning and search under compulsion constitutes an interference with the private life of a person questioned. It does not follow that screening questions without compulsion do so, and they would appear not to pass the threshold of interference, but that issue does not arise on the facts of this case. The issue here, accordingly, is whether the interference by questioning and search under compulsion is justified under article 8(2). In order for it to be justified, it must be (1) in accordance with the law and (2) a proportionate means to a legitimate end. In accordance with the law It is well established that the primary constituent of the requirement that interference with an ECHR right must be in accordance with the law (legality) is that there must be a lawful domestic basis for it, that this law must be adequately accessible to the public and that its operation must be sufficiently foreseeable, so that people who are subject to it can regulate their conduct. An example of a case which failed these primary tests is Malone v United Kingdom (1985) 7 EHRR 14, where it was found to be impossible to say with any reasonable certainty what elements of the powers to intercept communications were incorporated in legal rules and what elements remained within the discretion of the executive. The requirement of legality, however, is now established to go further than this. It calls for the law to contain sufficient safeguards to avoid the risk that power will be arbitrarily exercised and thus that unjustified interference with a fundamental right will occur. This proposition has often been re stated by the European Court of Human Rights (ECtHR). An example is S & Marper v United Kingdom (2008) 48 EHRR 1169, para 95: The court recalls its well established case law that the wording in accordance with the law requires the impugned measure both to have some basis in domestic law and to be compatible with the rule of law, which is expressly mentioned in the preamble to the Convention and inherent in the object and purpose of article 8. The law must thus be adequately accessible and foreseeable, that is, formulated with sufficient precision to enable the individual if need be with appropriate advice to regulate his conduct. For domestic law to meet these requirements, it must afford adequate legal protection against arbitrariness and accordingly indicate with sufficient clarity the scope of discretion conferred on the competent authorities and the manner of its exercise (see Malone v United Kingdom 1984 7 EHRR 14, paras 66 68; Rotaru v Romania (2000) 8 BHRR 449, para 55; and Amann v Switzerland (2000) 30 EHRR 843, para 56). Legality in this latter sense may be failed, for example, where there is an over rigid regime which does not contain the flexibility which is needed to avoid an unjustified interference with a fundamental right. This was the situation in both MM v United Kingdom [2012] ECHR 1906 and R (T) v Chief Constable of Greater Manchester Police (Liberty intervening) [2014] UKSC 35, [2015] AC 49. In those cases the statutory rules under which recordable convictions and cautions were automatically retained and compulsorily disclosed upon applications for particular forms of employment were held to fail the test of legality. This was in large part because they were without any flexibility or discretion to allow for the case where the recorded matter was irrelevant to the proposed employment and thus disclosure would constitute an unjustified (disproportionate) interference with article 8 rights. The safeguards (there of discretion or flexibility) were required in order to guard against automatic operation of the rule resulting in disproportionate interference with article 8 rights. It was in this context that Lord Reed observed in R(T), at para 114, that to satisfy the test of legality there must be sufficient safeguards in place to demonstrate that the State has properly addressed the issue of the proportionality of any interference and enabled it to be examined in a particular instance. In other situations, however, legality is relevant to the reverse case of discretionary power. Here what legality may require is that the safeguards should be present in order to guard against overbroad discretion resulting in arbitrary, and thus disproportionate, interference with Convention rights. The present is a case where the complaint of lack of legality is of this latter kind. In both kinds of case, the issue of legality is thus, whilst distinct from proportionality, closely linked to it. In both kinds of case, legality is a prior test which is designed to ensure that interference with Convention rights can be proportionate. It does not, however, subsume the issue of proportionality, whether the issue is the proportionality of the measure as a whole or the proportionality of its application in a particular case. As recorded above, there has been unanimity amongst all the independent reviews of the port questioning power as to its utility. This is clearly relevant to the question of the proportionality of the power, but it does not contribute significantly to the question of its legality. It is obvious that an arbitrary power can be useful, but it is not legitimate. In Gillan v United Kingdom (2010) 50 EHRR 1105 the Strasbourg court applied these principles to a different set of counter terrorist provisions of the TA 2000 and, differing from the House of Lords (R (Gillan) v Comr of Police of the Metropolis [2006] 2 AC 307), found that those failed the test of legality. There, the provisions in question were sections 44 46 TA 2000, which enabled a senior police officer to designate an area for a period of 28 days as one in which police officers could stop and search any person for articles of a kind which could be used in connection with terrorism. The power to stop and search did not depend on the existence of any objectively judged grounds for suspicion relating to the person intercepted. That characteristic is shared by the Schedule 7 power of port questioning here under consideration. The appellant in the present case relies heavily on that decision and contends that the port questioning power similarly fails the test of legality. The fact that the power was exercisable without depending on any prior suspicion, subjective or objective, was one of the reasons for the Strasbourg courts conclusion in Gillan. At para 83 the court said this: Of still further concern is the breadth of the discretion conferred on the individual police officer. The officer is obliged, in carrying out the search, to comply with the terms of the Code. However, the Code governs essentially the mode in which the stop and search is carried out, rather than providing any restriction on the officers decision to stop and search. That decision is, as the House of Lords made clear, one based exclusively on the hunch or professional intuition of the officer concerned. Not only is it unnecessary for him to demonstrate the existence of any reasonable suspicion; he is not required even subjectively to suspect anything about the person stopped and searched. The sole proviso is that the search must be for the purpose of looking for articles which could be used in connection with terrorism, a very wide category which could cover many articles commonly carried by people in the streets. Provided the person concerned is stopped for the purpose of searching for such articles, the police officer does not even have to have grounds for suspecting the presence of such articles. As noted by Lord Brown of Eaton under Heywood in the House of Lords [at para 74], the stop and search power provided for by section 44, radically . departs from our traditional understanding of the limits of police power. Whilst that factor is common to the provisions considered in Gillan and the present ones, there are otherwise very significant differences between that case and this. First, the section 44 power was exercisable in relation to any person anywhere in the street, whereas the Schedule 7 power is confined to those who are passing through ports of entry/exit. The public in this country has historically enjoyed the right to free movement about the streets and the power to stop and search is, as Lord Brown observed, a substantial intrusion upon it. In this country, there is no general requirement for identity documents to be carried and produced on demand when a citizen is out and about. By contrast, those who pass through our ports have always been adjusted to border controls, including the requirement to identify oneself and to submit to searches and answer questions in aid of general security. The potential importance of intercepting, detecting and deterring terrorists at border points is generally recognised. The current public concern about those leaving this country with a view to joining terrorist groups abroad is simply an example. The intrusion inherent in stopping for questioning and/or search is accordingly less at border points. As long ago as 1981 the European Commission on Human Rights referred in McVeigh, ONeill and Evans v United Kingdom (1981) 5 EHRR 71, para 192 to this factor, and to the widely recognised importance of controlling the international movement of terrorists. In his 1996 report Lord Lloyd identified it in the following passage: 10.27 As an island nation it has long been the British way to concentrate controls at its national frontiers, and to maintain a correspondingly greater freedom from random checks inland. This is not always the practice adopted in continental countries which have long land frontiers. But our geography gives us a unique opportunity to target checks where they are likely to be most effective; namely at the choke points provided by our ports and airports. That, of course, is where immigration and customs controls are also to be found. But it is only by virtue of the PTA [ie the then Prevention of Terrorism (Temporary Provisions) Act 1989] that the police have any power to stop and question people passing through ports. Immigration checks on EU nationals having in most eases been reduced to a simple passport check, only a separate police check is likely to identify a terrorist suspect if he is a national of an EU country. Lord Lloyd added at para 10.47 that the port powers were among the less controversial of the provisions in the statute and that very few of those who submitted evidence to him took exception to them. Those who did were comprised chiefly of those who were regular travellers to and from Ireland, who might at that time experience frequent questioning, together with pilots who wished to use airfields which were not authorised and port operators who wished to speed up the movement of travellers through their domains. This distinction between port controls and street searches is by no means confined to the UK. In the USA, for example, border searches of persons or packages are a long recognised exception to the Fourth Amendments prohibition on searches without probable cause and a warrant: see for example the decision of the Supreme Court in United States v Ramsey 431 US 606 (1977). Similarly, the Canadian Supreme Court referred in R v Simmons [1988] 2 RCS 495, 528 (in the context of holding that a contraband search based on reasonable suspicion of the presence of smuggled material is an exception to the usual requirements for searches imposed by section 8 of the Charter) to the fact that the degree of personal privacy reasonably expected at customs is lower than in most other situations. Delivering the majority opinion, Dickson CJ observed: People do not expect to be able to cross international borders free from scrutiny. Consequently, travellers seeking to cross national boundaries fully expect to be subject to a screening process. This process will typically require the production of proper identification and travel documentation and involve a search process Of course, the powers there under consideration differed from the present, as did the grounds for their exercise. The relevance of the cases is the recognition that public expectations are different at borders and that the intrusion represented by checks, questioning and searches is less than it is elsewhere. Second, the Strasbourg court in Gillan had great regard to the manner in which the section 44 power was actually being used, and in which controls over it provided by the statute were in fact not working. It identified several different failings. (a) Although there was an authorisation procedure for designation of a particular area, it depended only upon the senior police officer determining that such designation was expedient, which, unlike a test of necessity, betokened no assessment of proportionality (para 80). (b) Although authorisation required the approval of the Secretary of State, he had no power to alter the geographical scope of it, nor was there any evidence that he ever altered the time limit (para 80). (c) Much more significantly, for some years there had been, in the Metropolitan Police district, continuous rolling authorisations for the whole of the area, with each 28 day period being succeeded immediately by another (para 81). The result was that in the whole of Greater London any person might be subject to stop and search anywhere in the streets at any time. The same did not apply in other cities even when there might be specific reason for heightened terrorist alert (para 40). There was thus every sign that the authorisations were not responsive to particular calls for them, as they were clearly intended to be. This misuse of authorisations had been identified by the then Independent Reviewer, Lord Carlile, in 2002. It contrasted with the position at the time of Lord Lloyds inquiry six years earlier, when he had reported (at para 10.22) that the power was used with great discretion. (d) The evidence recorded by the Independent Reviewer showed a rapidly mushrooming use of the power of stop and search, from about 33,000 in 2004/2005 to triple that (117,000) in 2007/2008 (para 83). (e) The Independent Reviewer was an additional safeguard but although he had been calling for some years for the power to be used less, this had not been heeded (para 82). (f) The Independent Reviewer had, moreover, found that poor and unnecessary use of section 44 abounded, and he reported evidence of cases where the person stopped was so obviously far from any known terrorist profile that there was, realistically, not the slightest possibility that he or she was a terrorist, and there was no other reason for the stop (para 84). He had concluded that the evidence showed that section 44 was in some cases being used unacceptably as an instrument to aid non terrorism policing (para 43). (g) There was evidence of the section 44 power being used in a discriminatory fashion against black and Asian persons and indeed of a practice developing of stopping white people for no other reason than to produce greater racial balance in the statistics (para 85). (h) There was a real risk of the section 44 power being misused against demonstrators and protestors in breach of articles 10 or 11 (para 85). These factors demonstrated in Gillan that the apparent safeguards against disproportionate interference with Convention rights which were provided in the case of section 44 were ineffective. None of these factors, however, applies to port questioning and search powers. By contrast, in relation to them, the frequency of use has diminished, the Independent Reviewer endorses their continuation without expressing anxiety of misuse, his suggestions for improvements have been heard, and additional safeguards for the individual have been introduced as set out at paras 16 and 17 above. Although it is obvious that questioning is in one sense a different power from search, there are in the case of port questioning and search powers sufficient effective safeguards in the manner of operation to meet the requirement of legality. They include: (i) (ii) (iii) (iv) (v) (vi) the restriction to those passing into and out of the country; the restriction to the statutory purpose; the restriction to specially trained and accredited police officers; the restrictions on the duration of questioning; the restrictions on the type of search; the requirement to give explanatory notice to those questioned, including procedure for complaint; (vii) the requirement to permit consultation with a solicitor and the notification of a third party; (viii) the requirement for records to be kept; (ix) the availability of judicial review; the contention of the appellant and of Liberty that judicial review would be ineffective is overstated; judicial review is available if bad faith or collateral purpose is alleged, and also via the principle of legitimate expectation where a breach of the Code of Practice or of the several restrictions listed above is in issue; courts are well used to requiring police officers to justify their actions and to drawing the correct inference if there is material to do so; use of the power for a collateral purpose, such as to investigate a non terrorism suspected offence, would be likely to become apparent, as it did in the case of section 44 see para 41(f), (g) and (h) above. the continuous supervision of the Independent Reviewer is of the first importance; it very clearly amounts to an informed, realistic and effective monitoring of the exercise of the powers and it results in highly influential recommendations for both practice and rule change where needed. (x) The fact that questioning is not dependent on the existence of objectively established grounds for suspicion does not by itself mean that there are not adequate safeguards or that the power is not in accordance with the law. If that had been enough, the long discussion in Gillan of the failures of the safeguards would have been unnecessary. That is also to an extent illustrated by Colon v Netherlands (2012) 55 EHRR SE45 where a power of universal or random search in aid of public order in a particular area was held to meet the requirement of legality, although not grounded on any basis of suspicion. Certainly the power was granted for a short period, but that does not affect the principle. In the particular instance of the exercise of the power which had there occurred the searching had been universal, which meant that there was no potentially arbitrary selection by police officers, but the power did not have to be exercised in that way; random selection for search was equally permitted. The applicants contention in that case appears to have been limited to the absence of prior judicial approval, but the court reviewed Gillan and it seems clear that if it had concluded that the power failed for want of a suspicion based grounding, it would have said so, particularly since its practice is to consider issues of its own motion under the principle jura novit curia: see for example MM v United Kingdom (supra) at para 150. For these reasons the principle of legality is satisfied in relation to the Schedule 7 port questioning power. The suggested analogy with Gillan requires examination but fails. The need for safeguards is measured by the quality of intrusion into individual liberty and the risk of arbitrary misuse of the power. The intrusion into individual liberty is of a significantly lesser order at ports than in the streets generally. There are sufficient safeguards against arbitrary use of this power which either were not present or were not working in Gillan. There are effective controls via judicial review and the Independent Reviewer which prevent arbitrary use of the power or provide a correction if it should occur. Proportionality In Bank Mellat v HM Treasury (No 2) [2013] UKSC 39; [2014] AC 700, 770 771, para 20 Lord Sumption conveniently formulated the concept of proportionality into four questions. There has been no dispute in the present appeal about this formulation: (i) is the objective sufficiently important to justify limitation upon a fundamental right? (ii) is the measure rationally connected to the objective? (iii) could a less intrusive measure have been adopted? (iv) has a fair balance been struck between individual rights and the interests of the community? So far as concerns the power of port questioning and search the live dispute is as to the combination of the last two questions, which are inevitably linked. As to the first, the objective of Schedule 7 is clearly not border control per se but rather the prevention and detection of terrorism. That is clearly sufficiently important to justify some intrusion upon article 8 rights. The power of questioning and search is rationally connected to that objective; it is designed to serve it and the unanimous findings of the Independent Reviewers demonstrate its utility in aid of it. The appellant contended that it was not rationally connected to ports and borders, but that is not the question. Rather that contention is another way of confronting questions (iii) and (iv); moreover there is a plain rational reason for connecting questioning and search aimed at the prevention and detection of terrorism with border control. Of course acts of terrorism may be entirely confined to these shores, but it is obvious that those concerned in acts of terrorism, at whatever level, are very likely to be travellers and, certainly given the sources of present terrorist threats, to have international connections leading to travel. The current concern for outgoing travellers, some very young, seeking to join terrorist organisations abroad is merely an example. The gravamen of the appellants case is that all questioning and searching is plainly disproportionate unless it is based upon an objectively established reasonable ground for suspecting the person concerned of being within section 40(1)(b). Thus her case is that a less intrusive measure, namely a power based on such objective grounds for suspicion, could and should have been adopted, and that failure to do so does not strike a fair balance. The answer to these two linked questions depends in the end on the balance between the level of intrusion for the individual and the value of the power in community purpose served. It is common ground that the State is entitled to a generous margin of judgment in striking this balance. The importance for the public of the prevention and detection of acts of terrorism can scarcely be overstated and the level of risk of such acts is at least as high now as it has been at any time in the 40 years since these powers were introduced, though of course the sources of the threats have changed from time to time. Lord Lloyds 1996 report referred in the passage quoted at para 39 above to the unique opportunity to target checks where they are likely to be most effective, namely at the choke points provided by our ports and airports. He went on to record that the port checks were designed to deter terrorists from entering the UK to catch those who try: and to collect intelligence on the movement of persons of interest. He concluded that the intelligence which they yielded is a valuable by product of the work of the port examiners, and that he had heard that it makes a real contribution to the counter terrorism effort (para 10.41). The unanimous view of all independent observers who have considered the matter has consistently been that questioning and search powers which are not grounded on objectively demonstrable reasonable suspicion of involvement in terrorism are of undoubted value in the struggle against the threat of terrorism, and that to restrict the powers to those in respect of whom a reasonable suspicion can be demonstrated to the satisfaction of a court would not achieve anything like the same utility. The present Independent Reviewer gave specific consideration to this in his July 2013 report at paras 10.58ff. He gave examples of the detection and prevention of terrorist activity in cases where the threshold of objectively demonstrated grounds for reasonable suspicion would not have been passed. He adverted to the way in which, if such a threshold had to be passed, the use of clean skins (or previously innocent unknowns) could thwart investigation, travelling companions of known suspects could not be questioned and those actively involved in terrorism would be likely to be alerted (and, he might have added, likely to be given an insight into intelligence gathering). There is no reason to doubt these conclusions. In particular, it is clear that the vital intelligence gathering element of Schedule 7 would not be achieved if prior suspicion on reasonable grounds were a condition for questioning. A distinct issue relating to proportionality arises in connection with any potential for discriminatory application of the powers. There is in this case no separate claim that the appellant suffered discrimination, nor could there be given her husbands apparent connection with some form of terrorism. But if there were a real potential for misuse of the power on a racially discriminatory basis, that would be a reason pointing towards a lack of proportionality, and thus of justification. For the reasons explained by the Independent Reviewer, however, (see para 25 above) this risk is not a substantial one. Moreover the Code of Practice (para 43) requires that the records kept of examinations should detail the self declared ethnicity of the subject, which is a guard against discriminatory misuse. Nor is there any sign of compensatory selection of white subjects simply in order to balance the statistics, as there was found to be in relation to section 44 see para 41(g) above. Some degree of profiling of potential subjects for questioning is inevitable given the sources, from time to time, of terrorist threat. The present Code of Practice (at para 4) does little more than rehearse the public sector duty under the Equality Act 2010. Its later provisions in paras 18 and 19 do confront the issue more directly and they make clear that selection for questioning must be informed by the known sources of terrorist threat. However the statement that ethnic background or religion must not be used alone or in combination with each other as the sole reason for selecting the person for examination (para 19) is potentially confusing. The two propositions could usefully be drawn together. What needs to be made clear is that neither ethnic background nor religion can (separately or together) be the sole criterion for selection, unless present in association with known terrorist profiles or with other relevant characteristics, such as age, mode of travel, destination or origin. Overall, the level of intrusion into the privacy of the individual is, for the reasons which have been explained above, comparatively light and not beyond the reasonable expectations of those who travel across the UKs international borders. Given the safeguards set out above, it is not an unreasonable burden to expect citizens to bear in the interests of improving the prospects of preventing or detecting terrorist outrages. In those circumstances, the port questioning and associated search powers represent a fair balance between the rights of the individual and the interests of the community at large and are thus not an unlawful breach of article 8. Detention: article 5 The power of detention here under consideration exists only as an ancillary to the Schedule 7 powers of port questioning and search, that is to say to reinforce them and to make them effective. Such detention falls within article 5(1)(b) in that it is made in order to secure the fulfilment of an obligation prescribed by law. It follows that what has already been said about the port questioning and search powers applies also to detention, and that the safeguards which exist in relation to them stand also in relation to detention. It does not, however, follow, although the Divisional Court [2014] QB 607 thought otherwise, that the power of detention is automatically justified. The level of intrusion occasioned by detention for up to six hours is of a different order to the intrusion occasioned by compulsory questioning and search, and it does not follow either that the safeguards which are adequate for the one are sufficient for the other, or that the fair balance between the rights of the individual and the interests of the public falls in the same place. Detention under Schedules 7 and 8 may involve the removal of the individual to a police station, and even if it is conducted entirely at the port it represents a substantial interference with the freedom to travel on either in or out of the country and to go about ones ordinary business. The question of the compatibility of the power of detention with article 5 only barely arises in the present case. The appellant was prevented from moving on from the airport for about an hour and three quarters, some of which time she chose to use for prayer and thus to an extent delayed the questioning process. Whether that period was sufficient to constitute a deprivation of liberty for the purposes of article 5 is a question to which the answer is not clear. Deprivation of liberty, contrary to article 5, is to be contrasted with a simple restriction of freedom of movement, which is the subject of article 2 of Protocol 4, to which the UK is not a ratifying party: see Austin v United Kingdom (2012) 55 EHRR 359, where public order containment for several hours was held not to infringe article 5. We were referred also to the admissibility decision of the ECtHR in Gahramanov v Azerbaijan (Application No 26291/06) (unreported) given 15 October 2013, in which the applicant was prevented for (on his own case) some four hours from leaving, after being stopped at an airport. The court held the complaint inadmissible on the ground that it had not been shown that he had been obliged to remain any longer than was necessary to ascertain his status. In the present case the Secretary of State, as intervener, disputed that the appellant had suffered a deprivation of liberty. However, in the court below the Crown conceded that she had. It is helpful to address the question of detention more generally. To the extent that it is necessary to prevent a person being questioned from leaving whilst the process is underway, some degree of restriction of movement is a proper corollary of the port questioning and search power. It will usually not constitute a deprivation of liberty, as in Gahramanov. Even if it does, it will if it is for no more than is necessary to complete the process, be justified. The separate sanction of prosecution for the offence of failing to comply with the requirements of Schedule 7 may not be sufficient to ensure that questioning and search are effective and may not always bite on those who are leaving the country. What is not easy to see is why detention for as long as six hours can be necessary for this purpose. If a subject is bent on refusal, the additional period in a police station is unlikely to make a difference, and in any event the interference with personal liberty is sufficiently serious to call for greater justification than this. To be proportionate detention for this length of time calls for objectively demonstrated grounds, such as a suspicion on reasonable grounds that the subject falls within section 40(1)(b) or, of course, other grounds for arrest. The Independent Reviewer also had doubts about the power of detention, although he contemplated a test of subjective, rather than objectively justified, suspicion. The better view is that if detention beyond what is necessary to complete the process is to be undertaken it ought to be justified by objectively demonstrated suspicion. A refusal to co operate after explanation that the purpose of inquiry is to establish whether the subject is within that section might, depending on the circumstances, itself provide or contribute to grounds for such reasonable suspicion that he is, especially, for example, if he fails to identify himself. But it will not always do so; everything will depend on the facts. The Independent Reviewer doubted whether this would be so at the outset of questioning, and he is no doubt right that often it would not, but for the reasons given it is at that stage perfectly proportionate to prevent the subject moving on for a reasonable time whilst questions are asked, possessions inspected and any search undertaken. To the extent that there was any deprivation of liberty in the present case, it seems clear that it was for no longer than was necessary for the completion of the process. There was no requirement to attend a police station. Accordingly, there was in this case no breach of article 5. Inspection, copying and retention of electronic data The use of this power does not arise in the present appeal and it was not separately argued. The inspection of electronic data is no doubt akin to the inspection of written documents, or for that matter the inspection of baggage or possessions, and it may, as in those analogous cases, yield valuable intelligence, especially of contacts between persons who have separately come to attention. The Independent Reviewer has emphasised the value of material extracted from such sources (see para 21 above). But the retention of such data is a considerable intrusion into the private life of the subject, particularly given the volume and content of personal material which is kept nowadays on mobile telephones or portable computers. Paragraph 11A(3) of Schedule 7 permits retention under three heads. Under para 11A(3)(b) it may be retained while the examining officer believes it may be needed as evidence in criminal proceedings. Under para 11A(3)(c) it may be retained while he believes it may be needed in connection with an immigration decision. There appears no arguable disproportion in these provisions. But under para 11A(3)(a) it may be retained for so long as is necessary for the purpose of determining whether a person falls within section 40(1)(b). To the extent that this justifies retention for the duration of the stop, and for a short period afterwards to compare records, this would appear not to be disproportionate. Retention for long enough to compare with other records necessarily goes with the power to inspect, which would otherwise be of very limited value. But if para 11A(3)(a) were to be used to justify retention indefinitely so as to provide a bank of data, that would seem to be a different matter. Other objects seized cannot be retained beyond seven days in the absence of potential use as evidence on criminal or immigration issues (para 11(2)(a)). The Code (para 40) offers no further guidance on the retention of electronic data. In a case such as that postulated there appears to be a good deal of force in the Independent Reviewers conclusion that greater safeguards are called for (see para 26(b) above). His proposal was for a requirement that subjective suspicion should be enough, that it should be required for both copying and retention, and that if it exists both copying and retention should follow. It may be that the better view is that copying and initial inspection for a reasonable period should be governed by the same criteria as port questioning and the other search and retention powers, but that if longer retention is to be justified objectively established grounds for suspicion should be required. Whether the right period for initial inspection is the seven days prescribed for other material obtained by search would need evidence which this court has not needed to be given. Moreover, there ought to be verifiable means of destruction if retention is not justified. A definitive ruling on such matters must, however, if suitable adjustments are not made to the legislation or Code, await a case in which they are directly raised. It may also be necessary then to give detailed consideration to the inter relation between such data retention and other surveillance and data interception powers. Self incrimination and article 6 Two related questions arise at this stage: (a) could the appellant avail herself of the common law privilege against self incrimination when questioned under Schedule 7 or is that privilege inapplicable either because it is by necessary inference abrogated by the statute or because in the case of a person questioned under its powers no sufficient risk existed of the answers being used in criminal proceedings against either that person or her spouse? and (b) was the appellant in any event provided with a privilege against self incrimination by article 6 of the ECHR? In the Divisional Court the appellants case seems to have been argued almost entirely upon the second of these questions, but the first was fully raised in this court and should be addressed first. The privilege against self incrimination is firmly established judge made law dating from the 17th century abolition of the Star Chamber: see Holdsworths History of English Law (3rd ed) (1944) and Bishopsgate Investment Management Ltd v Maxwell [1993] Ch 1, 17. It entitles any person to refuse to answer questions or to yield up documents or objects if to do so would carry a real or appreciable risk of its use in the prosecution of that person or his spouse: In re Westinghouse Electric Corpn Uranium Contract Litigation MDL Docket No 235 (Nos 1 and 2) [1978] AC 547 and Rank Film Distributors Ltd v Video Information Centre [1982] AC 380. If such level of risk exists, the individual should be allowed great latitude in judging for himself the effect of any particular question: R v Boyes (1861) 1 B & S 311, 330, cited with approval in Westinghouse. A statute may, however, exclude this privilege in a particular situation, and may do so either expressly or by necessary implication: Bishopsgate (supra). Because the privilege is firmly embedded in the common law, such necessary implication must be established with clarity and is not to be assumed; the approach classically enunciated by Lord Hoffmann in relation to fundamental human rights in R v Secretary of State for the Home Department, Ex p Simms [2000] 2 AC 115, 131 is clearly appropriate: Parliamentary sovereignty means that Parliament can, if it chooses, legislate contrary to fundamental principles of human rights. The Human Rights Act 1998 will not detract from this power. The constraints upon its exercise by Parliament are ultimately political, not legal. But the principle of legality means that Parliament must squarely confront what it is doing and accept the political cost. Fundamental rights cannot be overridden by general or ambiguous words. This is because there is too great a risk that the full implications of their unqualified meaning may have passed unnoticed in the democratic process. In the absence of express language or necessary implication to the contrary, the courts therefore presume that even the most general words were intended to be subject to the basic rights of the individual. For the appellant Mr Matthew Ryder QC correctly submitted that such a parliamentary intention will often be gathered from an ancillary provision preventing the use in criminal prosecutions of answers or material disclosed, or sometimes limiting such use to specific kinds of prosecution, such as for giving false information on the occasion of the questioning. As he says, no such ancillary provision is present here. That, however, is to overstate the position. There is no parliamentary consistency of practice. Sometimes, a statute which provides for an obligation to provide information or to answer questions will indeed say that no privilege against self incrimination may be claimed. Sometimes there will be added a provision that any answer given may not be relied upon in a subsequent criminal prosecution, or only in prosecutions for making a false statement in answer. A familiar example of both provisions occurring is section 31 of the Theft Act 1968. But other provisions which are clearly intended to impose an unqualified obligation to answer do not contain one, or either, of such stipulations. An example is afforded by the provisions considered in Bishopsgate, sections 235 and 236 of the Insolvency Act 1986. In that case, the Court of Appeal concluded that the transparent purpose of those provisions to enable a liquidator or similar office holder to obtain information in the public interest, would be stultified if a person required to give that information could refuse to answer by claiming privilege. Another illustration is R v Hertfordshire County Council, Ex p Green Environmental Industries Ltd [2000] 2 AC 412 where the House of Lords, in a speech delivered by Lord Hoffmann, held that the same applied to section 71(2) of the Environmental Protection Act 1990. The same applies to the present provisions. The Schedule 7 powers are patently not aimed at the obtaining of information for the purpose of prosecuting either the person questioned or his spouse. Whilst that does not by itself mean that there is no real risk that such information could be so used subsequently, it is an indicator that the process of information gathering is not to be limited by the operation of privilege. The reality is that Schedule 7 powers would be rendered very largely nugatory if privilege applied. The necessary implication is that it does not. Moreover, there is a powerful reason why the risk of prosecution based upon answers to Schedule 7 questioning is not a real and appreciable one. Whilst the mere fact that prosecution is not the purpose of such questioning does not sufficiently reduce the risk, the provisions of section 78 of the Police and Criminal Evidence Act 1984 in practice do. That section provides that evidence relied upon by the prosecution in a criminal trial may be excluded if it appears to the court that, having regard to all the circumstances, including those in which the evidence was obtained, its admission would have such an adverse effect upon the fairness of the proceedings that it should not be admitted. Before the Divisional Court, and likewise in this court, the Crown has been unable to postulate any scenario in which answers obtained under the compulsory powers afforded by Schedule 7 would not fall to be excluded under this section, and there is no known case in which such answers have been adduced in a prosecution, although on one occasion they were adduced at the request of the defendant. It is to be accepted as a general proposition that reliance on a judicial discretion is not to be equated, for a prospective defendant, with the exercise of his privilege against self incrimination: see observations to this effect in Rank Films (para 442) and Bishopsgate (para 19). But the section 78 controlling power, vested in the trial judge in criminal proceedings, is not sufficiently described as a matter of discretion. It is a matter of judgment. If in practice the outcome of the exercise of that judgment is inevitably that the evidence will be excluded, then the real and appreciable risk which the privilege against self incrimination exists to guard against is not present. The circumstances in which the evidence was obtained are a central consideration in the exercise of the section 78 judgment. Evidence obtained from the defendant himself (or his spouse) by means of legal compulsion is a classic case of evidence which it will be unfair to admit. Even without the direct application of article 6 ECHR the outcome of the section 78 judgment is effectively inevitable. Once article 6, directly binding on a court under section 6(3) of the Human Rights Act 1998, is brought into the equation, there is simply no room for any contrary conclusion, for, as is shown by Saunders v United Kingdom (1997) 23 EHRR 313 (below), article 6 has the effect that any use in a criminal prosecution of answers obtained under compulsion of law will be a breach of the right to a fair trial. The presence or absence of other evidence implicating the defendant is irrelevant to this proposition. For this reason, it is simply nothing to the point that the Director of Public Prosecutions declined in the Divisional Court to volunteer an undertaking never to seek to adduce Schedule 7 material if later there were a criminal prosecution; she would never be allowed to do so. For the same reason, the suggested possibility of use does not contribute to the assessment of proportionality. So clearly is this the inevitable outcome of the application of section 78 that it is difficult to understand why effect has not been given to the Independent Reviewers recommendation that the position be put beyond argument (such as has been made here) by the enactment of a provision making answers or information obtained inadmissible except in proceedings under para 18 of Schedule 7 or for an offence of which the gist is deliberately giving false information when questioned. It may be that the view has been taken that the effect of section 78 was so clear that specific provision is not necessary. The present argument demonstrates that it is desirable. Moreover, it is necessary to make the position plain in relation to the (largely theoretical) possibility that if A was indeed prosecuted, his co accused B, if hostile to him, might seek to adduce material deriving from Schedule 7 questioning; section 78 would have no application since it would not be the Crown which was adducing the evidence, and fairness might have to be achieved by the unsatisfactory method of severance. It is to be hoped that following the observations of the Divisional Court and (now) this court, such enactment will follow. Article 6 ECHR does not contain an explicit privilege against self incrimination, but it is well established that such is implicit in it. The trigger for the privilege is, however, that a person is charged with a criminal offence, in the special sense in which that word is used in the jurisprudence of the Strasbourg court, that is to say that his position has been substantially affected by an allegation against him and he has become, in effect, a suspect: see Lord Hopes summary of the rule in Ambrose v Harris [2011] UKSC 43; [2011] 1 WLR 2435, paras 62 63. If a person is charged in this sense, then the effect of article 6 will be to confer the privilege against self incrimination and any abrogation by statute of the common law privilege will accordingly be ineffective; moreover the use in a subsequent criminal trial of answers obtained under compulsion before the defendant was charged will be an infringement of the right to a fair trial. See for example Saunders v United Kingdom where section 434(5) of the Companies Act 1985 had abrogated the privilege. In that case the answers given under compulsion to DTI inspectors were adduced in a criminal prosecution of the subject and it was that which constituted the breach of article 6. The court made it clear at para 67 that the asking of the questions, at a stage when the defendant (as he later became) had not been charged and the purpose of the questioning was an administrative investigation quite different from a criminal one, did not amount to a breach of article 6. Port questioning and search under Schedule 7 TA 2000 is not part of a criminal investigation. Its purpose is not the accumulation of an evidential case against the subject. If that follows, it is a separate matter. The subject is not a person charged for the purposes of article 6, which has no application to him. The appellant was at no stage a defendant to a criminal charge and no question of a breach of a right to a fair trial arises. For those reasons, there was in the present case neither a wrongful denial of the common law privilege against self incrimination nor a breach of article 6 ECHR. Conclusion It follows that the appeal should be dismissed. LORD NEUBERGER AND LORD DYSON: The relevant factual and legal background is set out in the judgment of Lord Hughes at paras 1 27 above, and we agree with most of his subsequent reasoning. There is nothing we wish to add to what Lord Hughes says in paras 57 70 in relation to electronic data, self incrimination and article 6 of the Convention. However, because we consider that there is force in the opposite view, we will briefly express our reasoning on the two main points which have caused Lord Kerr to reach the opposite conclusion in relation to article 8 (albeit in a different order from that on which they are discussed in his judgment), namely proportionality (his paras 119 128) and legality ie in accordance with the law (his paras 93 111). Exercise of the Schedule 7 powers, and in particular exercise of the initial powers of stopping and questioning under para 2, which are the focus of this appeal, is said to involve a potential interference with the rights of the person concerned under articles 5 and 8 of the Convention. We agree with Lord Hughes that article 5 is not engaged for the reasons which he gives at paras 52 56 above. However, as he says, it is common ground that article 8 is engaged. Accordingly, the four requirements set out in R (Aguilar Quila) v Secretary of State for the Home Department (AIRE Centre intervening) [2011] UKSC 45, [2012] 1 AC 621, para 45 (Lord Wilson) and Bank Mellat v HM Treasury (No 2) [2013] UKSC 39; [2014] AC 700, 770 771, 790 791, paras 20 and 74 (Lord Sumption and Lord Reed respectively) must be satisfied. We agree that the first two requirements, namely importance of objective and rationality of connection, are satisfied as Lord Hughes and Kerr say; however, unlike Lord Kerr, we also consider that the third and fourth requirements, namely necessity and fair balance (or proportionality), are satisfied. The two most fundamental and well established functions of any government are the defence of the realm from external attack and the maintenance of the rule of law internally. The powers granted to the executive by the legislature under Schedule 7 are for the purpose of ensuring national security, which includes aspects of both those vital functions as well as having the important role of curbing terrorism internationally. A court should be circumspect before upholding any challenge to such legislative powers, when that challenge is based on necessity or disproportionality. The executive is, or at any rate should be, particularly well informed and experienced in assessing any risks to national security and how to deal with them, whereas the courts are not. However, this does not mean that the court should simply wave through any such legislation: the rule of law crucially requires the court to be vigilant when assessing the necessity or proportionality of both the contents and the implementation of any statute which interferes with human rights. The importance of, and tension between, the need for circumspection and the need for vigilance is apparent from the discussion in the judgments in this court in R (Lord Carlile of Berriew) v Secretary of State for the Home Department [2014] UKSC 60, [2015] AC 945, paras 31 44, 67 74, 104 109, 112 117 and 147 174. Further, as Lord Reed also said in Bank Mellat (No 2), para 71, the degree of restraint practised by courts in applying the principle of proportionality, and the extent to which they will respect the judgment of the primary decision maker, will depend on the context, and will in part reflect national traditions and institutional culture. In our view, it is not correct to say that in every case where the issue of necessity or proportionality arises the executive must produce positive evidence to show that the means which it has adopted to meet the objective in question is no more than is required. In some cases, it would be tantamount to proving a negative, which is often hard and sometimes impossible. It is important to be realistic as well as principled when assessing the proportionality of any means adopted: the need for a degree of reality in relation to proportionality was acknowledged by Lord Reed in Bank Mellat (No 2) at para 75. In any case where an issue of necessity or proportionality arises, it is appropriate to consider the third and fourth questions raised by Aquila and Bank Mellat (No 2) by reference to the practical realities of the case in question, as well as general principles. Turning to this case, it is of course not in dispute that properly trained police officers should have the power to exercise border controls to curb terrorism by stopping and questioning individuals entering or leaving the United Kingdom, ie at ports and borders. Once that is accepted, we find it hard to see how there could be any objection to giving officers the right to stop and question people at ports or borders on a random, or unpredictable, basis ie on a basis which cannot be predicted by those passing through the ports and borders provided that that right is properly regulated and supervised, and as predictable and controlled as reasonably possible. The legislature does not consider it necessary that officers should stop and question everyone passing through ports and borders, a course which would be self evidently generally much more intrusive on individual rights. In those circumstances, it is easy to understand why Schedule 7 does not limit the right to stop and question to those people who give rise to objectively explicable suspicion. The fact that officers have the right to stop and question unpredictably is very likely to assist in both detecting and preventing terrorism, and in deterring some who might otherwise seek to travel to or from this country for reasons connected with terrorism. Further, many experienced officers may have a feeling of suspicion, which is justified but objectively inexplicable, of a particular individual passing through a port or border. Of course, in many cases, it may be inappropriate to allow even the likelihood of an increase in the prospects of successfully achieving a legitimate aim to justify an interference with human rights. However, in this case, the interference is slight (see paras 51 and 54 56 above), the independent justification is convincing (see paras 39 and 49 above), the supervision is impressive (see paras 19 26 above), there are substantial safeguards (para 43 above), the benefits are potentially substantial (see paras 20 23 above), and no equally effective but less intrusive proposal has been forthcoming. In those circumstances, we conclude that the appeal, in so far as it is based on proportionality, should fail. We turn to legality. The requirement that legislation is in accordance with the law means (i) that the legislation must have some basis in domestic law and (ii) that it must be compatible with the rule of law, as the Grand Chamber of the Strasbourg court put it in S & Marper v United Kingdom (2008) 48 EHRR 1169, para 95. Unsurprisingly, it is not suggested that Schedule 7 fails to satisfy the first requirement, and the argument on legality therefore focusses on the second requirement. The argument that the Schedule 7 powers are incompatible with Convention rights in this connection is that they are unlawful in the light of the unpredictability of, and lack of control over, their application. Thus, it is said, contrary to what the Fourth Section of the Strasbourg court held was required in Gillan v United Kingdom (2010) 50 EHRR 1105, paras 76 77, the powers in question are not sufficiently precise or constrained. In other words, it is said that the power under paragraph 2 of Schedule 7 has not been formulated with sufficient precision to enable the individual to regulate his conduct, and it involves a legal discretion granted to the executive expressed in terms of an unfettered power. In Gillan, the court had to consider the lawfulness of the power conferred by section 44 of the 2000 Act on a senior police officer to designate an area anywhere in the United Kingdom as one in which the police could stop and search any person for articles in connection with terrorism. The designated areas were often substantial (eg the whole of the Greater London area) and the periods, although limited, were almost automatically renewed. Both the successful applicants and the court made the point that the power under consideration was to be distinguished from a power of search exercised at airports (paras 59 and 64). To use the words of the court, [a]n air traveller may be seen as consenting to such a search by choosing to travel and has a freedom of choice, whereas, under section 44, [t]he individual [could] be stopped anywhere and at any time, without notice and without any choice as to whether or not to submit to a search. Furthermore, the court in Gillan was also plainly influenced by a number of other factors which it mentioned in paras 83 85 of its judgment. Those factors were (i) the fact that the domestic court, the House of Lords, considered that the section 44 power radically . departs from our traditional understanding of the limits of police power, (ii) the very large and fast increasing number of stop and searches which were being conducted annually under section 44, (iii) the startling fact that every one of them had been fruitless, (iv) the fact that the independent reviewer had criticised the way in which stop and search under section 44 had been conducted in a number of highly significant respects, (v) the fact that black and Asian persons [had been] disproportionately affected by the section 44 stop and search system, and (vi) the fact that section 44 could be used against demonstrators and protesters in breach of articles 10 and/or 11. We do not read the decision in Gillan as ruling that any random stop and search system, let alone any system which permits officers randomly to stop and question preliminarily, cannot be in accordance with the law. This view is supported by the Third Sections decision in Colon v Netherlands (2012) 55 EHRR SE45, which upheld a universal right of stop and search in a particular area, albeit for a limited, but not inconsiderable, period. While the court in Colon relied in paras 73 and 76 78 on certain factors which distinguished it from Gillan, its decision emphasises how the determination of lawfulness is very sensitive to the facts of the particular case. (However, it is only fair to acknowledge that the court in Colon relied on some features of the Dutch stop and search system which are not present here.) The point that the lawfulness of any scheme is highly fact sensitive was made by the court in Gillan at para 77, where it said that [t]he level of precision required of domestic legislation which cannot in any case provide for every eventuality depends to a considerable degree on the content of the instrument in question, the field it is designed to cover and the number and status of those to whom it is addressed (a passage repeated in Colon in para 72). And, as the Grand Chamber observed in Rekvnyi v Hungary (Application No 25390/94) (2000) 30 EHRR 519, para 34: [w]hilst certainty is highly desirable, it may bring in its train excessive rigidity and the law must be able to keep pace with changing circumstances. Accordingly, many laws are inevitably couched in terms which, to a greater or lesser extent, are vague and whose interpretation and application are questions of practice. In the same case, the Grand Chamber said at para 59 that lawfulness implies qualitative requirements in the domestic law such as foreseeability and, generally, an absence of arbitrariness. When considering whether the legality principle is satisfied in relation to a particular system, it appears clear from the reasoning in the judgment in Gillan that one must look not only at the provisions of the statute or other relevant instrument which gives rise to the system in question but also at how that system actually works in practice. There are, in our view, important differences between the statutory provisions and modus operandi of the system in this case and those of the system in Gillan, and those differences establish that the powers in this case are more foreseeable and less arbitrary than those in Gillan and, in our view, justify the lawfulness of the Schedule 7 powers. First, the areas in which Schedule 7 powers can be exercised are targeted by statute to specific and relatively limited and confined places, namely ports and airports. As Lord Lloyd put it in his report, these locations constitute the first line of defence against the entry of terrorists and, it may be added, the exit of terrorists. Secondly, the individuals against whom the powers in question can be exercised are limited by statute to a relatively limited, identifiable and specific group, namely, only against those passing across the UKs borders. Thirdly, the Schedule 7 powers may only be exercised for a limited purpose, namely to determine whether the person concerned appears to be a person who is or has been concerned in the commission, preparation or instigation of acts of terrorism. Furthermore, none of the more specific concerns which the court raised in paras 83 85 of Gillan, summarised in para 83 above, appear to us to arise here. (i) The Schedule 7 powers, particularly as they are only exercisable at a port or airport, cannot be said to be extraordinary. Questioning, even challenging, people who are seeking to enter or leave a country is relatively commonplace. Physical searches at security points in airports are not infrequently conducted on a random basis. (ii) As the evidence summarised in para 18 above establishes, a relatively limited number of people are interviewed under Schedule 7, and the number has decreased each year between 2009/2010 and 2013/2014, whereas the court in Gillan (see para 84) was struck by the dramatic increase in numbers of people stopped and searched, year on year. (iii) Quite unlike the powers in Gillan, the exercise of the powers under review in the present case has produced some successful outcomes see paras 20 23 above. (iv) The independent reviewer is very positive about the way in which the Schedule 7 system is working and is being operated, as is apparent from what is said in para 24 above; indeed, he describes the system as an essential ingredient in the fight against terrorism. Again, this is quite different from the independent reviewers assessment in Gillan. By contrast with point (v) in para 83, there is no evidence that the Schedule 7 powers have been used in a racially discriminatory fashion. Indeed, discriminatory use is specifically prohibited by the code. In this connection, the independent reviewers reports quoted in para 25 above are significant. Finally, (vi) unlike the powers in Gillan, the Schedule 7 powers could not be used against demonstrators and protesters in breach of articles 10 and/or 11. It is right to add that we are not convinced that there is much force in the respondents arguments that (i) the code governing the Schedule 7 powers is more restrictive than that governing the powers considered in Gillan, or (ii) the nature of the powers exercised under Schedule 7 is less intrusive than those exercisable under the powers considered in Gillan. So far as point (i) is concerned, little if any argument was directed to it, and consideration of the two codes does not suggest a very significant difference between them. As to point (ii), we do not consider that it has much, if any, bearing on the issue of legality, although we accept that it could be of real relevance to the issue of proportionality. Nonetheless, these reservations do not in any way undermine the significance of the points made in paras 87 and 88 above. The significant differences between the Schedule 7 powers and the powers considered in Gillan, which are set out in paras 88 and 89 above do not, of course, automatically mean that the powers granted by Schedule 7 to the 2000 Act satisfy the requirement of legality. Legality is said to give rise to a problem for the powers granted under paragraph 2 of Schedule 7 because those powers can be exercised randomly. However, it is important to the effectiveness of these powers that they can be exercised in this way. Furthermore, if the power to stop and question under Schedule 7 infringes the Convention because it is exercisable randomly, the logical conclusion must be either that the valuable power must be abandoned or the power must be exercised in a far more invasive and extensive way, namely by stopping and questioning everyone passing through ports and borders. The former alternative would be unfortunate in terms of deterring and hindering terrorism, whereas the latter alternative would seem to put proportionality and legality in irreconcilable tension. Further, the Schedule 7 powers are subject to the specific controls set out by Lord Hughes in paras 16, 17 and 43 of his judgment. There are, of course, cases in which legality requires practical systems that are otherwise in the public interest to be abandoned. However, given the various factors summarised in paras 88 89 above, as more fully considered by Lord Hughes in his judgment, we have reached the conclusion the powers granted by paragraph 2 of Schedule 7 to the 2000 Act do not offend against the requirement of legality, and accordingly we conclude that this appeal should be dismissed. LORD KERR: (dissenting) Legality The opportunity to exercise a coercive power in an arbitrary or discriminatory fashion is antithetical to its legality. The primary question in this case is whether the powers under Schedule 7 to the Terrorism Act 2000 can be used in this way or whether there are in place sufficient safeguards to prevent them from being exercised in such a manner. It is not enough that they have not in fact been used arbitrarily or in a discriminatory way. If they can be used in such a way, they will not be legal. Moreover, powers which can be used in an arbitrary or discriminatory way are not transformed to a condition of legality simply because they are of proven utility. The most important authority in this area is the Strasbourg decision in Gillan v United Kingdom (2010) 50 EHRR 1105 and probably the most important passage from the judgment (in relation to the issues in the present case) is that contained in para 83, quoted by Lord Hughes in para 36 above. There are important earlier passages, however. In paras 76 and 77, the court said this: 76. the words, in accordance with the law require the impugned measure both to have some basis in domestic law and to be compatible with the rule of law, which is expressly mentioned in the preamble to the Convention and inherent in the object and purpose of article 8. The law must thus be adequately accessible and foreseeable, that is, formulated with sufficient precision to enable the individual if need be with appropriate advice to regulate his conduct. 77. For domestic law to meet these requirements it must afford a measure of legal protection against arbitrary interferences by public authorities with the rights safeguarded by the Convention. In matters affecting fundamental rights it would be contrary to the rule of law, one of the basic principles of a democratic society enshrined in the Convention, for a legal discretion granted to the executive to be expressed in terms of an unfettered power. Consequently, the law must indicate with sufficient clarity the scope of any such discretion conferred on the competent authorities and the manner of its exercise. The level of precision required of domestic legislation which cannot in any case provide for every eventuality depends to a considerable degree on the content of the instrument in question, the field it is designed to cover and the number and status of those to whom it is addressed (emphasis supplied) As ECtHR acknowledged, eleven constraints on the exercise of the powers at issue in the Gillan case had been identified by Lord Bingham when the case had been before the House of Lords (R (on the application of Gillan) v Comr of Police of the Metropolis [2006] UKHL 12; [2006] 2 AC 307). These were set out in para 14 of Lord Binghams speech: . First, an authorisation under section 44(1) or (2) may be given only if the person giving it considers (and, it goes without saying, reasonably considers) it expedient for the prevention of acts of terrorism. The authorisation must be directed to that overriding objective. Secondly, the authorisation may be given only by a very senior police officer. Thirdly, the authorisation cannot extend beyond the boundary of a police force area, and need not extend so far. Fourthly, the authorisation is limited to a period of 28 days, and need not be for so long. Fifthly, the authorisation must be reported to the Secretary of State forthwith. Sixthly, the authorisation lapses after 48 hours if not confirmed by the Secretary of State. Seventhly, the Secretary of State may abbreviate the term of an authorisation, or cancel it with effect from a specified time. Eighthly, a renewed authorisation is subject to the same confirmation procedure. Ninthly, the powers conferred on a constable by an authorisation under sections 44(1) or (2) may only be exercised to search for articles of a kind which could be used in connection with terrorism. Tenthly, Parliament made provision in section 126 for reports on the working of the Act to be made to it at least once a year, which have in the event been made with commendable thoroughness, fairness and expertise by Lord Carlile of Berriew QC. Lastly, it is clear that any misuse of the power to authorise or confirm or search will expose the authorising officer, the Secretary of State or the constable, as the case may be, to corrective legal action. Notwithstanding the existence of these constraints, ECtHR considered that the safeguards provided for in domestic law did not constitute a real curb on the wide powers afforded to the executive so as to offer the individual adequate protection against arbitrary interference para 79. The reasons for this conclusion were given in para 83 of the courts judgment (op cit) and in the following passages from paras 80 82: 80. The court notes at the outset that the senior police officer referred to in section 44(4) of the Act is empowered to authorise any constable in uniform to stop and search a pedestrian in any area specified by him within his jurisdiction if he, considers it expedient for the prevention of acts of terrorism. However, expedient means no more than advantageous or helpful. There is no requirement at the authorisation stage that the stop and search power be considered necessary and therefore no requirement of any assessment of the proportionality of the measure. The authorisation is subject to confirmation by the Secretary of State within 48 hours. The Secretary of State may not alter the geographical coverage of an authorisation and although he or she can refuse confirmation or substitute an earlier time of expiry, it appears that in practice this has never been done. Although the exercise of the powers of authorisation and confirmation is subject to judicial review, the width of the statutory powers is such that applicants face formidable obstacles in showing that any authorisation and confirmation are ultra vires or an abuse of power. 81. The authorisation must be limited in time to 28 days, but it is renewable. It cannot extend beyond the boundary of the police force area and may be limited geographically within that boundary. However, many police force areas in the United Kingdom cover extensive regions with concentrated populations. The Metropolitan Police Force Area, where the applicants were stopped and searched, extends to all of Greater London. The failure of the temporal and geographical restrictions provided by Parliament to act as any real check on the issuing of authorisations by the executive are demonstrated by the fact that an authorisation for the Metropolitan Police District has been continuously renewed in a rolling programme since the powers were first granted. 82. An additional safeguard is provided by the independent reviewer. However, his powers are confined to reporting on the general operation of the statutory provisions and he has no right to cancel or alter authorisations, despite the fact that in every report from May 2006 onwards he has expressed the clear view that, section 44 could be used less and I expect it to be used less. Drawing on the description of the section 44 powers in this passage, it is possible to contrast them with the powers contained in Schedule 7 in a variety of different ways. These illustrate the greater ambit of the Schedule 7 powers. No authorisation, whether from a senior police officer or otherwise, is required for the examining officer to have resort to the Schedule 7 powers. The exercise of those powers is not dependent on the examining officer (or anyone else) considering that it is expedient to do so for the prevention of acts of terrorism. Since no authorisation is required, there is no question of it being subject to review by the Secretary of State. There is no geographical or temporal limitation on the exercise of the powers (other than, of course, that they are to be used at a port of entry into or exit from the United Kingdom). There is no provision for automatic lapse of the powers nor is there any question of their renewed authorisation being subject to confirmation. Certain features are common to both sets of powers. The width of the powers is similar in both instances and challenges to their use on conventional judicial review grounds both face the same difficulty as was identified by ECtHR in Gillan. Both are subject to review by the independent reviewer but, as in Gillan, so in this case, this is a post hoc review. The independent reviewer cannot restrict the exercise of the powers. He may merely make recommendations as to their future use and, as we have seen in this case, his recommendations are not always followed. Resort to the powers may be based on no more than a hunch or the professional intuition of the officer concerned. Indeed, the absence of any requirement of either reasonable or even subjective suspicion in both instances clearly contemplates that this is the basis on which the powers will in fact be exercised. The sole proviso as in Gillan is that the Schedule 7 powers should be exercised for the purpose of determining whether the person who is subject to them appears to be or have been concerned in the commission, preparation or instigation of acts of terrorism. The same considerations affect the viability of a judicial review challenge and this in turn brings sharply into question the claim that judicial superintendence of the exercise of the powers is an effective safeguard against their being resorted to in an arbitrary, discriminatory or disproportionate fashion. If an examining officer does not have to form a suspicion, how is his exercise of the powers to be reviewed? At present, the only averment required of an officer whose use of the powers is challenged is that they were exercised for the statutory purpose. On the current state of the law that unvarnished statement will be sufficient to insulate the exercise of the powers from further investigation or challenge. It is said that a distinguishing feature of the Schedule 7 powers is that, whereas the section 44 power was exercisable in relation to any person in the designated geographical area, the Schedule 7 powers may only be used in relation to those passing through ports of entry or exit. It is suggested that, while people in this country expect to be allowed to pass through the streets freely, they have traditionally accepted that they will be subject to border controls such as the requirement to identify themselves. Two points should be made about this. Firstly, being subject to border controls such as the requirement to provide proof of identity and entitlement to enter is an entirely different matter from being required to answer questions about ones movements and activities. As this case shows, these questions can be quite detailed and, more importantly, if they are not answered, the person of whom they are asked faces criminal sanction. Secondly, and more importantly, whether people in this country are accustomed to intrusion when they move through ports of entry or exit does not bear on the question of whether the circumstances in which the Schedule 7 powers may be exercised are too widely drawn to satisfy the test of in accordance with law. Put shortly, an unfettered power which may be arbitrarily or capriciously used does not become legal just because people generally do not take exception to its use. The significance of the restriction on the use of Schedule 7 powers to ports of entry should not be misunderstood. As the respondent has acknowledged, there are 245m passenger movements through United Kingdom ports every year. All are potentially subject to this power. The fact that it is exercised sparingly has no direct bearing on its legality. A power on which there are insufficient legal constraints does not become legal simply because those who may have resort to it, exercise self restraint. It is the potential reach of the power rather than its actual use by which its legality must be judged. Moreover, although the percentage of travellers who are subjected to the use of the power is small, in absolute terms the number is not inconsequential. On average 5 to 7 people each day are examined for more than an hour. That there is the potential for arbitrary or discriminatory exercise of the power is apparent from, among other things, the provisions of the Code of Practice. It stipulates that selection should not be based solely upon the ethnic background or religion of the individual. This provision is objectionable for two reasons. In the first place there is no clearly obvious means of policing the requirement that persons should not be stopped and questioned just because of their ethnic background or religion. As ECtHR held in Gillan at para 86 in the absence of any obligation on the part of the officer [exercising powers of stop and search under TA section 44] to show a reasonable suspicion, it is likely to be difficult if not impossible to prove that the power was improperly exercised. Keeping records of the self declared ethnicity of those subject to the Schedule 7 powers does not, of itself, provide a guarantee that the powers are not being exercised in a discriminatory way. Secondly, the provision in the Code of Practice contemplates that ethnic origin or religious adherence can be at least one of the reasons for exercising the power. In so far as the perceived religious belief or ethnic origin of an individual (as opposed to his or her capacity to provide information about their possible involvement in terrorism) is the basis on which he or she is made subject to Schedule 7 powers, this constitutes direct discrimination. As Lord Nicholls of Birkenhead held in Nagarajan v London Regional Transport [2000] 1 AC 501, 512H: Decisions are frequently reached for more than one reason. Discrimination may be on racial grounds even though it is not the sole ground for the decision. Provided that race exerted a more than trivial influence on the decision to treat a person less favourably, the decision will constitute race discrimination (Igen Ltd (formerly Leeds Careers Guidance) v Wong [2005] ICR 931, paras 36 37). As Mr Squires, for the intervener, the Equality and Human Rights Commission, submitted, if examining officers exercise Schedule 7 powers not because they have any particular suspicion or intelligence about an individual but on the basis of an intuition that a person looks like a terrorist, it is predictable that those of Asian or Muslim appearance will be disproportionately targeted. The startling reality that this legislation authorises the use of a coercive power, at least partly, on the grounds of race and religion should be starkly confronted. That not only permits direct discrimination, it is entirely at odds with the notion of an enlightened, pluralistic society all of whose members are treated equally. The legality of a measure which interferes with a Convention right must also be vouched against its demonstrable proportionality. Limits to police powers must be prescribed in order to enable the necessary examination of whether the specific exercise of those powers is proportionate to take place and in order to demonstrate that a proper balance between individual rights and wider public interests has been struck. The majority in R (T) v Chief Constable of Greater Manchester Police (Liberty intervening) [2015] AC 49, held that ensuring that a particular provision was proportionate was an aspect of the prescribed by law requirement. This is, of course, distinct from the question whether an interference in a particular case was necessary (see per Lord Reed paras 114 115). In order to be prescribed by law, the legal regime governing the exercise of police powers must include limitations capable of securing the proportionate exercise of those powers and of ensuring that the proportionality of any interference can be adequately examined (ibid para 114). Where the stop, question and search powers can be exercised without any suspicion whatever, there is simply no material on which a judgment as to whether they are being used proportionately can be made. The examining officer does not have to explain why he or she chose a particular individual for the exercise of the Schedule 7 powers. Indeed, he or she does not have to have a reason (in the sense of a rationalised conclusion) for the exercise of the power, since it is unnecessary to have any form of suspicion. A purely instinctive impulse based on nothing more than a feeling that something relating to terrorism might be disclosed by the exercise of the powers is enough to permit recourse to them. In those circumstances, an examination of whether the powers have been used proportionately is simply unfeasible. This crucial dimension of the prescribed by law requirement is missing from the Schedule 7 regime. On that account use of the Schedule 7 powers cannot be said to be in accordance with law. Utility The utility of a provision in this case, its effectiveness as a counter terrorism measure is, at least potentially, relevant to a claimed justification of interference with a qualified Convention right. So, for instance, if it could be shown that the exercise of Schedule 7 powers provided a tangible result in terms of reducing the risk of terrorist attack, this would sound on the question of pursuit of a legitimate aim for the interference and whether a proper balance had been struck between the rights of the individual and the interests of the community. But it is misconceived to assume that, because the possible utility of Schedule 7 powers is relevant to justification of an interference with a Convention right, it meets the requirement that the measure be in accordance with law. The distinction between the manner in which a power is exercised and the result that its exercise may achieve should be clearly recognised. It does not follow that, because a measure is an effective counter terrorist tool, the way in which that tool is deployed is automatically proportionate and in accordance with law. In Colon v The Netherlands (2012) 55 EHRR SE45 a power of search in aid of public order, on foot of a designation by the Burgomaster, in the old centre of Amsterdam was held to meet the requirement of legality, although not grounded on any basis of suspicion. It is to be noted, however, that the applicants complaint that the interference with his right to respect for his private life was not in accordance with the law was confined to what he claimed was the ineffectiveness of the judicial remedies available. In particular, he argued that an essential guarantee in the form of prior judicial control was missing. The European Court dealt with that claim in paras 75 78 as follows: 75. The court has accepted in past cases that prior judicial control, although desirable in principle where there is to be interference with a right guaranteed by article 8, may not always be feasible in practice; in such cases, it may be dispensed with provided that sufficient other safeguards are in place (see, mutatis mutandis, Klass v Germany (1979 80) 2 EHRR 214, para 56; and Rotaru v Romania, (2000) 8 BHRC 449 para 59). In certain cases, an aggregate of non judicial remedies may replace judicial control (see, mutatis mutandis, Leander v Sweden (1987) 9 EHRR 433, paras 64 65). 76. In the Netherlands, all pertinent legal texts are in the public domain (compare and contrast para 30 of Gillan). Before the public prosecutor can order police to carry out a search operation, a prior order designating the area concerned must be given by an administrative authority of the municipality, the Burgomaster. That order must in turn be based on a byelaw adopted by an elected representative body, the local council, which has powers to investigate the use made by the Burgomaster of his or her authority (see paras 34 36 above). 77. Review of a designation order, once it has been given, is available in the form of an objection to the Burgomaster, followed if necessary by an appeal to the Regional Court and a further appeal to the Administrative Jurisdiction Division of the Council of State (see para 40 above). 78. The criminal courts have a responsibility of their own to examine the lawfulness of the order and the scope of the authority of the official who gave it. It is a defence for anyone charged with failing to comply with a search order issued by or on behalf of the public prosecutor to state that the order was not lawfully given; the criminal court must answer it in its judgment (see para 41 above). The emphasis of the legality debate was on the reviewability of the authorising agents (the Burgomasters) decision, rather than on any opportunity to examine the proportionality of the individual decision of officers as to who should be stopped and searched. The use which the Burgomaster made of his or her powers remained subject to review and control by the local council, an elected representative body. It is important to understand, therefore, that the courts reference to the effectiveness of the measure (in paras 94 and 95 of its judgment) was made in the context of the justification of the interference with the article 8 right, rather than as an assessment of the accordance with law requirement. The fact that a measure may be effective in pursuit of the aim of counteracting terrorism does not mean that its use in accordance with law is to be assumed. If the measure is not effective to achieve its avowed aim, this is, of course, a reason to find it disproportionate. But the converse does not hold true. The proportionality of a measure is not to be determined by its efficacy in fulfilling its objective. The privilege against self incrimination and article 6 The venerable history of the privilege against self incrimination and its place at the centre of our system of criminal justice have been described by Lord Hughes in para 60 of his judgment. The importance attached to this right is such that it is not to be lightly set aside. As Lord Griffiths said in AT & T Istel Ltd v Tully [1993] AC 45, 57 the privilege is deeply embedded in English law and can only be removed or moderated by Parliament and in Gray v News Group Newspapers Ltd [2013] 1 AC 1, para 18 Lord Neuberger of Abbotsbury MR said that it was for the legislature and not the judiciary to remove or cut down the privilege against self incrimination. Two particular features of the right should be noted. It is engaged when compliance with a legal obligation to answer questions would create a real and appreciable risk of criminal proceedings being brought In re Westinghouse Electric Corpn Uranium Contract Litigation MDL Docket No 235 (Nos 1 and 2) [1978] AC 547, 574 per Lord Denning MR. Secondly, the relevant risk is of prosecution, not conviction: Sociedade Nacional de Combustiveis de Angola UEE v Lundqvist [1991] 2 QB 310; JSC BTA Bank v Ablyazov (No 13) [2014] EWHC 2788. So, if answering the questions put to her by examining officers would expose Mrs Beghal (or, for that matter, her husband) to an appreciable risk of prosecution, the privilege against self incrimination is in play. It is not necessary to show that criminal proceedings are likely. The privilege arises unless the risk is so far beyond the bounds of reason as to be no more than a fanciful possibility: Westinghouse [1978] AC 547, 579 per Roskill LJ. It is suggested that the powers under Schedule 7 would be ineffective if the privilege against self incrimination was held to apply to them. The premise on which this is based appears to be that those stopped and questioned under Schedule 7 would be unlikely to answer without there being in place the prospect of prosecution if they refused to respond. It must therefore be assumed that Parliament intended that the privilege should be abrogated in relation to the use of these powers. For my part, I would be reluctant to make the assumption that those who were questioned under Schedule 7 would indeed refuse to answer unless faced with the possibility that they would be prosecuted in consequence. But I have a more fundamental reason for disagreeing with the conclusion that the privilege against self incrimination does not arise in relation to the exercise of Schedule 7 powers. I am therefore prepared to proceed on the hypothetical basis that Parliament did indeed intend that the privilege should be abrogated. It is suggested that Schedule 7 powers are not aimed at obtaining information for the purpose of prosecuting the person questioned or her spouse. I do not understand why this should be so. The purpose of questioning under the schedule is to determine whether the person questioned appears to be a terrorist within the wide definition contained in section 40(1)(b) of the 2000 Act. If answers to the questions posed suggest that the person questioned is indeed someone who has committed an offence under one of the sections specified in section 40 or who is or has been concerned in the commission, preparation or instigation of acts of terrorism, why should those answers not form the basis of a prosecution? It seems to me inescapable that there is a real and appreciable risk of prosecution if the answers to the questions posed prove to be self incriminating. The fact that, in this case, it was not suspected that the appellant was a terrorist is nothing to the point. If, as she should have been, she was asked questions designed to establish whether she appeared to be a terrorist, the potential of her answers to incriminate her if they were of an inculpatory character, is indisputable. In the Divisional Court [2014] QB 607 there was some discussion as to whether the Director of Public Prosecutions might be prepared to give an undertaking that answers to questions asked in the exercise of Schedule 7 powers would never form part of a subsequent prosecution case. Unsurprisingly, to me at least, the Director declined to give that undertaking. It would be a startling policy decision to give an assurance that evidence of terrorism elicited by Schedule 7 questioning would not be used to prosecute someone implicated by such evidence. The independent reviewer and, incidentally, the Divisional Court and Lord Hughes in his judgment in this case, have recommended that Parliament should enact a provision making answers or information obtained inadmissible in proceedings, except where there has been a breach of paragraph 18 of the Schedule (wilful failure to comply with a duty under Schedule 7) or for an offence of deliberately giving false information when questioned. The plain fact is, however, that self incriminating answers given in response to questions posed under Schedule 7 can form the basis of a prosecution. It is suggested, however, that such a prosecution would not be viable by reason of section 78 of the Police and Criminal Evidence Act 1984. True it is that the exercise of the power to exclude evidence under this provision must be exercised in accordance with article 6 of ECHR and that this has the effect that any use in a criminal prosecution of answers obtained under compulsion of law will generally be a breach of the right to a fair trial. But two caveats to that must be entered. In the first place, answers to questions posed under Schedule 7 can prompt inquiry which might lead to the obtaining of evidence independent of the material which the responses have supplied. Secondly, it is by no means clear that evidence of those answers will automatically be excluded if there is other evidence which directly implicates the person responding. So, for instance, if there is significant other evidence which, alone, might be sufficient to establish the guilt of the accused, is it inevitable that evidence of responses given during a Schedule 7 investigation which corroborates or reinforces that evidence, would be excluded? I do not believe that it is. Of greater importance, however, is the consideration that the protection afforded by the privilege against self incrimination is against the risk of prosecution rather than conviction. In this context the significance of the DPPs understandable refusal to confirm that there will never be any circumstances in which responses to a Schedule 7 questioning will not be used in a prosecution comes fully into play. There is, currently, no guarantee that someone who gives a self incriminating answer in the course of a Schedule 7 inquiry will not be confronted by those answers in a subsequent criminal trial. He may succeed in having evidence of those answers excluded but he cannot ensure that he will not be prosecuted on foot of them. I consider therefore that the requirement in Schedule 7 that a person questioned under its provisions must answer on pain of prosecution for failing to do so is in breach of that persons common law privilege against self incrimination. On that account it is incompatible with article 6 of ECHR. Articles 5 and 8 It is accepted that the exercise of Schedule 7 powers constitutes an interference with article 5 and article 8 rights. This throws the focus of the discussion about those rights on the question of justification. To establish justification, it is necessary to satisfy a trilogy of tests: the interference must pursue a legitimate aim; it must be in accordance with law; and it must be necessary in a democratic society. An aspect of the last of these is proportionality. As Lord Wilson in R (Aguilar Quila) v The Secretary of State for the Home Department (AIRE Centre intervening) [2012] 1 AC 621, para 45 and Lord Sumption and Lord Reed in Bank Mellat v HM Treasury (No 2) [2014] AC 700, 770 771, 789, paras 20 and 70ff explained, this normally requires that four questions be addressed: (a) (b) is the legislative objective sufficiently important to justify limiting a fundamental right?; are the measures which have been designed to meet it rationally connected to it?; are they no more than are necessary to accomplish it?; and (c) (d) do they strike a fair balance between the rights of the individual and the interests of the community? The objective of the Schedule 7 powers (counteracting terrorism) can be readily acknowledged as a legitimate aim. And obtaining information about whether a person appears to be a terrorist is rationally connected to that aim. As is usually the case, the real debate centres on the third and fourth issues: is the breadth of the powers no more than is necessary to achieve the aim; and has a fair balance been struck between the rights of the individual and the interests of the community. The fact that a power has been successful in promoting the aim of the interference with a Convention right does not supply the complete answer to the question whether it is no more than is necessary to achieve the aim. Nor does the endorsement of the usefulness of the power by the independent reviewer. Valuable though the independent reviewers opinions are, the question whether this undoubted interference with an individuals Convention rights is no more than is necessary is one for the courts. And the courts should be mindful that the proven success of the use of the power does not establish that no lesser form of interference would be just as efficacious. Nor does it, indeed, address the question whether, even if somewhat less effective, a more unobtrusive interference would be sufficient to fulfil the aim of the measure. While the state enjoys an area of discretionary judgment as to what measures are needed to pursue a particular aim, this does not relieve it of the obligation to produce some evidence that the specific means chosen to bring that about are no more than is required. There is no evidence that a suspicion less power to stop, detain, search and question is the only way to achieve the goal of combatting terrorism. The fact that the measure has been successful does not establish that proposition. Indeed, to take the example of detention, it is clear that the measure goes beyond what is necessary. As Lord Hughes has pointed out in paras 54 and 55, detention beyond what is necessary to complete the process should be justified by objectively demonstrated suspicion. The fact that the appellant was not detained for more than was necessary does not establish that the breadth of the power available to examining officers is proportionate. Plainly, it is not. Likewise, the failure or refusal of Parliament to enact a provision making answers or information obtained by use of Schedule 7 powers inadmissible in proceedings disposes of any possible argument that this measure goes no further than is required to meet its aim. The opinion of the independent reviewer and the Divisional Court that this enactment should be made has not been challenged. While the provision remains in force, that aspect of the Schedule 7 powers is not only not in accordance with law (for the reasons earlier given) but also, ipso facto, more than is necessary to fulfil the objective of the interference. Of course it is true that the threat of terrorism is substantial and should not be downplayed. But that undoubted truth should not mask or distort the obligation to dispassionately examine the aptness of measures taken to deal with it. If they are to be seen as no more than necessary, the powers under Schedule 7 must be capable of withstanding scrutiny of their rationale. In my view, no reasoned justification has been proffered for investing examining officers with a power to stop, search, question and detain anyone passing through a port and for making those who refuse to answer questions amenable to the criminal law. On the issue of whether a proper balance has been struck between the rights of the individual and the interests of the community, the degree of interference with rights is self evidently relevant. And it is unquestionably true that in many cases, the interference with the Convention rights may be relatively unobtrusive. It is also undoubtedly relevant that members of the public expect to be questioned at ports of entry to and exit from the United Kingdom and that many raise no objection to the use of Schedule 7 powers. Again, the scourge of terrorism and the need to take effective measures against it loom large in this context. But the potential reach of the Schedule 7 powers must also be clearly recognised. A person stopped under this provision is required to answer questions even though they may not have had the benefit of legal advice. Individuals may have many reasons why they do not want to answer questions as to their movements and activities. These reasons are not necessarily or invariably discreditable. Some may be apprehensive about answering questions without a lawyer being present or may lack a full understanding of the significance of refusing to answer. The fact that they are open to criminal sanction, which could include imprisonment, for failing to answer questions, renders the exercise of these powers a significant interference with article 8 rights, in my opinion. Again, the absence of any articulated reason for the need for a suspicion less power to stop, detain, etc makes its justification on the basis that it strikes the right balance problematic. The safeguards outlined by Lord Hughes in para 43 of his judgment do not bear on this anterior question, and, in fairness, he does not suggest that they do. Whatever may be said about the efficacy of those safeguards (and there is, at least, ample scope for debate about, for instance, the effectiveness of judicial review) they do not supply the necessary justification for allowing examining officers to exercise the powers under Schedule 7 without any suspicion whatever. For that fundamental reason, I cannot accept that the particular form of interference which Schedule 7 represents has been shown to be justified. Conclusion I would allow the appeal and declare that Schedule 7 of the Terrorism Act 2000 is incompatible with articles 5, 6 and 8 of ECHR.

On 4 January 2011, Mrs Sylvie Beghal passed through East Midlands Airport with her three children on returning from visiting her husband in Paris, a French national in custody on terrorist offences. She was stopped by police and, although not formally detained, arrested or suspected of being a terrorist, was told they needed to speak to her to establish whether she was involved in terrorist acts. The police did this exercising the power under Paragraph 2 of Schedule 7 of the Terrorism Act 2000, which deals with questioning individuals at ports or borders for the purpose of determining whether he appears to be [or to have been concerned in the commission, preparation or instigation of acts of terrorism]. No reasonable suspicion of a past or future offence is needed. Under other provisions of Schedule 7, officers may also: require the production of documents carried; copy and retain material; and, search and detain (currently for a maximum of 6 hours) individuals. By way of sanction, Paragraph 18 of Schedule 7 of the Terrorism Act 2000 makes it a criminal offence, on pain of fine and/or imprisonment, wilfully to fail to comply with such requirements. A Code of Practice exists for officers exercising these powers. Mrs Beghal sent her two eldest children to the arrivals gate, asked for a lawyer (with whom she spoke on the phone) and requested and was granted an opportunity to pray. She was searched and in the absence of the lawyer was asked, amongst other questions, about her relationship with her husband, her reasons for travel, where she had stayed and whether she had travelled beyond France. She refused to answer most of the questions and was charged with the offence of wilful failure to comply with the requirement to answer questions. The questions and reporting her for failure to answer them lasted under half an hour. She later pleaded guilty to this offence and her sentence was a conditional discharge. Mrs Beghal brought proceedings arguing that the Schedule 7 powers breached her Article 5 (right to liberty), Article 6 (privilege against self incrimination) and Article 8 (right to respect for private and family life) rights under the European Convention on Human Rights (ECHR). The Divisional Court dismissed her claims. The Supreme Court dismisses the appeal by a majority of 4 1 (Lord Kerr dissenting). Lord Hughes delivers the lead judgment. Lord Neuberger and Lord Dyson give a joint concurring opinion. Powers of questioning and search and inspecting, copying and retaining data on electronic devices Article 8 ECHR Questioning and search under compulsion undoubtedly constitutes an interference with Article 8(1) ECHR [28]. As to justification under Article 8(2) ECHR, it is in accordance with the law as there are sufficient safeguards and controls against overbroad and arbitrary use of this power [45]. These include, for example, the restrictions on the location, duration and type of questioning and search, the requirement to permit consultation with a solicitor, the availability of judicial review and the supervision of the Independent Reviewer of terrorism legislation [43]. The fact that questioning does not require objective grounds for suspicion does not by itself mean that the safeguards are inadequate [44]. The power is also proportionate: (i) questioning and search at ports is rationally connected to the proper objective of Schedule 7, which is preventing and detecting terrorism [47]; (ii) to require reasonable suspicion before using the power would not achieve anything like the same utility in fighting the threat of terrorism [49]; and, (iii) it also represents a fair balance between the rights of individuals and the interests of community at large; the level of intrusion is comparatively light and not beyond the reasonable expectations of international travellers and the importance of preventing and detecting acts of terrorism can scarcely be overstated [48, 51]. There is also no substantial risk of these powers being used on a racially discriminatory basis. The statistics show that the exercise of Schedule 7 powers is proportionate to the terrorist population, considering the sources of the terrorist threat, that travels through UK ports [50]. Retaining electronic data is a considerable intrusion into the private life of an individual [57]. It may well be that retention longer than an initial inspection for a reasonable period can only be justified if there exist objectively established grounds for suspicion [58]. This power, however, was not used in the case of Mrs Beghal. Power to detain Article 5 ECHR The power to detain for six hours falls within Article 5(1)(b) ECHR and involves a greater level of intrusion than questioning and search [52]. Nonetheless, restricting an individuals movement in order to exercise the questioning and search power, and for no more than is necessary, will either not be a deprivation of liberty or will be justified [54]. The better view is that detention beyond what is necessary to complete the process of questioning and search for example, for six hours can only be justified by objectively demonstrated suspicion [55]. However, in this case any deprivation of Mrs Beghals liberty was for no longer than was necessary for the completion of the process [56]. Privilege against self incrimination Article 6 ECHR Schedule 7 excludes privilege against self incrimination as it is by necessary inference abrogated by the words of the statute [64]. Moreover, the risk of prosecution based on answers to Schedule 7 is not a real and appreciable one; in practice section 78 of the Police and Criminal Evidence Act 1984 (PACE) would inevitably render such evidence inadmissible. Article 6 ECHR would also compel the same result [65 66]. As port questioning and search is not part of a criminal investigation, the individual is not a person charged for the purposes of Article 6 ECHR so that Article 6 ECHR has no application [69]. Lord Kerr (dissenting) would find that the Schedule 7 powers are incompatible with Articles 5, 6 and 8 ECHR: (i) they are not in accordance with the law. The potential for arbitrary or discriminatory exercise of the powers is apparent from the Code of Practice [103 104]. Moreover, a crucial element of this requirement is to make it possible to examine whether the powers have been used proportionately. Where the Schedule 7 powers can be exercised without any suspicion whatsoever there is simply no material to judge whether they are being used proportionately [106]; (ii) the powers are greater than necessary to accomplish the aims; there is no evidence that such suspicion less powers are the only way to achieve the goal of combatting terrorism and no reasoned justification has been given for granting examining officers such powers [122, 124]; (iii) a proper balance has not been struck between the rights of the individual and the interests of the community [126 127]. Lord Kerr further finds that the requirement to answer questions breaches an individuals common law privilege against self incrimination and is incompatible with Article 6 ECHR. There is, inescapably, a real and appreciable risk of prosecution if answers to the questions posed prove to be self incriminating [115].

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The question at issue on this appeal is whether two provisions of the State Immunity Act 1978 are consistent with the European Convention on Human Rights and the European Union Charter of Fundamental Rights. The two provisions are section 4(2)(b) and section 16(1)(a). I shall set out both below, but in summary the effect of section 4(2)(b) is that a state is immune as respects proceedings relating to a contract of employment between a state and a person who at the time of the contract is neither a national of the United Kingdom nor resident there; and the effect of section 16(1)(a) is that a state is immune as respects proceedings concerning the employment of members of a diplomatic mission, including its administrative, technical and domestic staff. It is common ground that the answer depends in both cases on whether these provisions have any basis in customary international law although, as I shall explain, there is an issue about what kind of basis it must have. Ms Minah Janah, the Respondent to this appeal, is a Moroccan national. In 2005, when she was resident in Libya, she was recruited to work for the Libyan government as a domestic worker at its embassy in London. She entered the United Kingdom on a visa which recorded her status as Domestic Worker (Diplomatic), and continued to work for the embassy until she was dismissed in 2012. During that time, she worked successively in a number of Libyan diplomatic households, and latterly in the residence of the ambassador. Her duties were cooking, cleaning, laundry, shopping and serving at meals. In April 2012, she began proceedings against Libya in the Employment Tribunal in support of a claim for failure to pay her the National Minimum Wage, breaches of the Working Time Regulations, failure to provide her with payslips or a contract of employment, unfair dismissal, discrimination and harassment. At all material times since her arrival in the United Kingdom, Ms Janah has been resident, but not permanently resident here. Ms Fatimah Benkharbouche is also a Moroccan national. In 2000, when she was working for the Sudanese government in Iraq, she agreed to move to the United Kingdom to work for its embassy in London as a housekeeper and cook to the ambassador. Her employment by the London embassy began on 16 May 2000 and continued until the autumn of 2001. She then returned for some years to Iraq, before being re engaged to work for the London embassy in the same role as before. Her second term of employment began on 28 January 2005 and continued until she was dismissed on 27 November 2010. She subsequently began proceedings in the Employment Tribunal in support of claims for unfair dismissal, failure to pay her the National Minimum Wage, unpaid wages and holiday pay, and breaches of the Working Time Regulations. By the time of her dismissal, she was permanently resident in the United Kingdom, having been granted indefinite leave to remain with effect from 25 January 2010. It is common ground that under the terms of the State Immunity Act 1978, Libya is entitled to state immunity in respect of Ms Janahs claim and Sudan in respect of Ms Benkharbouches. In Ms Janahs case, this is because she has never been a Libyan national and was not a national or permanent resident of the United Kingdom at the time when her contract was made. Both section 4(2)(b) and section 16(1)(a) therefore apply to her. In Ms Benkharbouches case, it is because section 16(1)(a) applies to her. There are as yet no findings about whether the facts of her case bring her within section 4(2)(b). Both claims were dismissed by different judges in the Employment Tribunal on the ground that the employer was immune. In the Employment Appeal Tribunal the two cases were heard together. The EAT declared that sections 4(2)(b) and 16(1)(a) of the Act should be disapplied so far as they prevented Ms Janah from bringing claims based on EU law, on the ground that they were contrary to the right of access to a court guaranteed by article 47 of the EU Charter. The claims based on discrimination and harassment and breaches of the Working Time Regulations were accordingly allowed to proceed. Leave to appeal to the Court of Appeal was granted, inter alia, in order to enable it to consider whether to make a declaration of incompatibility under section 4 of the Human Rights Act 1998. This led to the joinder of the Secretary of State under section 5 of the Human Rights Act 1998 so as to participate in the appeal. The Court of Appeal affirmed the judgment of the EAT, disapplying the relevant provisions so far as they applied to the EU law claims. It also made a declaration of incompatibility affecting all the claims, whether founded on domestic or EU law. Sudan elected not to participate in the proceedings before the Court of Appeal and has not appealed to this court. Ms Benkharbouche was represented in the Court of Appeal but has not appeared before us. Libya participated in the proceedings in the Court of Appeal, but although it was granted permission to appeal to this court, it has not been permitted to pursue the appeal because it has failed to comply with an order of this court for security for costs. In those circumstances, the effective participants in the appeal to this court have been the Secretary of State, who appeals in both cases, and Ms Janah. We have also received written and oral submissions on behalf of the AIRE centre, and written submissions on behalf of 4A Law. It is agreed that Ms Janahs appeal raises all of the issues in either case, but I shall refer from time to time to Ms Benkharbouches position also. I propose first to examine the provisions of the State Immunity Act and then the requirements of the Human Rights Convention, before turning to the relationship between the Act and the international law of state immunity. The State Immunity Act 1978 Before 1978, state immunity was governed in the United Kingdom by the common law. Properly speaking, it comprised two immunities whose boundaries were not necessarily the same: an immunity from the adjudicative jurisdiction of the courts of the forum, and a distinct immunity from process against its property in the forum state. During the second half of the nineteenth century, the common law had adopted the doctrine of absolute immunity in relation to both. The classic statement was that of Lord Atkin in Compania Naviera Vascongada v S S Cristina (The Cristina) [1938] AC 485, 490: The courts of a country will not implead a foreign sovereign, that is, they will not by their process make him against his will a party to legal proceedings whether the proceedings involve process against his person or seek to recover from him specific property or damages. By 1978, however, the position at common law had changed as a result of the decisions of the Privy Council in The Philippine Admiral [1977] AC 373 and the Court of Appeal in Trendtex Trading Corpn v Central Bank of Nigeria [1977] QB 529. These decisions marked the adoption by the common law of the restrictive doctrine of sovereign immunity already accepted by the United States and much of Europe. The restrictive doctrine recognised state immunity only in respect of acts done by a state in the exercise of sovereign authority (jure imperii), as opposed to acts of a private law nature (jure gestionis). Moreover, and importantly, the classification of the relevant act was taken to depend on its juridical character and not on the states purpose in doing it save in cases where that purpose threw light on its juridical character: Playa Larga (Owners of Cargo Lately Laden on Board) v I Congreso del Partido (Owners) [1983] 1 AC 244. Before the adoption of the restrictive doctrine at common law, the United Kingdom had signed a number of treaties limiting the scope of state immunity in particular respects. It was a signatory to the International Convention for the Unification of Certain Rules concerning the Immunity of State owned Ships (Brussels, 1926), which restricted the immunity of state owned trading vessels. It had also signed the European Convention on State Immunity (Basle, 1972), a regional treaty drawn up under the auspices of the Council of Europe which identified specified categories of acts done by foreign states in the territory of the forum state which would not attract immunity. These treaties were concerned mainly with acts of a kind which would generally not attract immunity under the restrictive doctrine. But neither of them sought to codify the law of state immunity or to apply the restrictive doctrine generally. In addition, they have attracted limited international support. The Brussels Convention of 1926 has attracted 31 ratifications to date. The Basle Convention of 1972 has to date been ratified by only eight of the 47 countries of the Council of Europe. One purpose of the State Immunity Act 1978 was to give effect to the Brussels and Basle Conventions, and thereby enable the United Kingdom to ratify them. It did this in both cases in 1979. But by this time, the conventions had been largely superseded by the adoption of the restrictive doctrine of state immunity at common law. The Act therefore dealt more broadly with state immunity, by providing in section 1 for a state to be immune from the jurisdiction of the courts of the United Kingdom except as provided in the following sections of Part I. The exceptions relate to a broad range of acts conceived to be of a private law character, including widely defined categories of commercial transactions and commercial activities, as well as contracts of employment and enforcement against state owned property used or intended for use for commercial purposes. In Alcom Ltd v Republic of Colombia [1984] AC 580, 597 598, Lord Diplock, with whom the rest of the Appellate Committee agreed, observed that given the background against which it was enacted, the provisions of the Act fall to be construed against the background of those principles of public international law as are generally recognised by the family of nations. The principle of international law that is most relevant to the subject matter of the Act is the distinction that has come to be drawn between claims arising out of those activities which a state undertakes jure imperii, ie, in the exercise of sovereign authority, and those arising out of activities which it undertakes jure gestionis, ie transactions of the kind which might appropriately be undertaken by private individuals instead of sovereign states. For present purposes, the relevant provisions of the State Immunity Act are sections 1, 3, 4 and 16. So far as they bear on the points at issue, they provide as follows: Immunity from jurisdiction 1.(1) A State is immune from the jurisdiction of the courts of the United Kingdom except as provided in the following provisions of this part of this Act. 3.(1) A State is not immune as respects proceedings relating to (3) a commercial transaction entered into by the (a) State; an obligation of the State which by virtue of a (b) contract (whether a commercial transaction or not) falls to be performed wholly or partly in the United Kingdom. In this section commercial transaction means any contract for the supply of goods or services; (a) (b) any loan or other transaction for the provision of finance and any guarantee or indemnity in respect of any such transaction or of any other financial obligation; and (c) any other transaction or activity (whether of a commercial industrial, financial, professional or other similar character) into which a State enters or in which it engages otherwise than in the exercise of sovereign authority; but neither paragraph of subsection (1) above applies to a contract of employment between a State and an individual. 4.(1) A State is not immune as respects proceedings relating to a contract of employment between the State and an individual where the contract was made in the United Kingdom or the work is to be wholly or partly performed there. (2) Subject to subsections (3) and (4) below, this section does not apply if at the time when the proceedings are brought the (a) individual is a national of the State concerned; or (b) at the time when the contract was made the individual was neither a national of the United Kingdom nor habitually resident there; or (c) in writing. the parties to the contract have otherwise agreed 16.(1) This Part of this Act does not affect any immunity or privilege conferred by the Diplomatic Privileges Act 1964 or the Consular Relations Act 1968; and (a) section 4 above does not apply to proceedings concerning the employment of the members of a mission within the meaning of the Convention scheduled to the said Act of 1964 or of the members of a consular post within the meaning of the Convention scheduled to the said Act of 1968. The Convention scheduled to the Diplomatic Privileges Act of 1964 is the Vienna Convention on Diplomatic Relations (1961). Article 1 of that Convention defines members of a mission as including the staff of the mission in the domestic service of the mission. It follows that section 16(1)(a) covers employees in the position of Ms Janah and Ms Benkharbouche. Since the passing of the State Immunity Act, the United Kingdom has signed, but not ratified, a further treaty, the United Nations Convention on Jurisdictional Immunities of States and their Property (2004). The Convention is the result of the long drawn out labours of the United Nations International Law Commission between 1979 and 2004. For the most part, it is consistent with the United Kingdom Act, which indeed was one of the models used by the draftsmen. But there are differences, in particular relating to contracts of employment, which would require the Act to be amended before the United Kingdom could ratify it. To date, however, the United Nations Convention has attracted limited support. Twenty eight states have signed it, including the United Kingdom. Of these, 21 have ratified it, not including the United Kingdom. Libya and Sudan have neither signed nor ratified it. It will not come into force until it has been ratified by 30 states. The European Convention on Human Rights The respondents case is that sections 4(2)(b) and 16(1)(a) of the State Immunity Act 1978 are incompatible with article 6 of the Convention, because they unjustifiably bar access to a court to determine their claims. Article 4(2)(b) is also said to be incompatible with article 14 read in conjunction with article 6, because it unjustifiably discriminates on grounds of nationality. For the moment I shall put the case on discrimination to one side, to return to it later. The main point argued before us was based on article 6. Article 6 of the Human Rights Convention provides that in the determination of his civil rights and obligations, or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law. Two points are well established, and uncontroversial in this appeal. The first is that article 6 implicitly confers a right of access to a court to determine a dispute and not just a right to have it tried fairly: Golder v United Kingdom (1975) 1 EHRR 524. The right to a court corresponds to a right which the common law has recognised for more than two centuries. As early as the 1760s, Blackstone wrote in his Commentaries, 4th ed (1876), 111: A right of every [man] is that of applying to the courts of justice for redress of injuries. Since the law is in England the supreme arbiter of every mans life, liberty and property, courts of justice must at all times be open to the subject and the law be duly administered therein. The second uncontroversial point is that although there is no express qualification to a litigants rights under article 6 (except in relation to the public character of the hearing), the right to a court is not absolute under the Convention any more than it is at common law. It is an aspect of the rule of law, which may justify restrictions if they pursue a legitimate objective by proportionate means and do not impair the essence of the claimants right: Ashingdane v United Kingdom (1985) 7 EHRR 528, para 57. One of the perennial problems posed by the right to a court is that article 6 is concerned with the judicial processes of Convention states, and not with the content of their substantive law. When the Duke of Westminster complained in James v United Kingdom (1986) 8 EHRR 123 that the Leasehold Reform Act 1967 allowed qualifying leaseholders to enfranchise their properties without providing any grounds on which the freeholder could object, he was met with the answer (para 81) that article 6 does not in itself guarantee any particular content for (civil) rights and obligations in the substantive law of the Contracting States. In Fayed v United Kingdom (1994) 18 EHRR 393, the Court explained (para 65) that it was not at liberty to create through the interpretation of article 6(1) a substantive civil right which has no legal basis in the state concerned, but that it would be inconsistent with the rule of law if the state were to confer immunities from civil liability on large groups or categories of persons. These statements have been repeated in much of the subsequent case law of the Strasbourg Court. It is not always easy to distinguish between cases in which the petitioners problem arose from some difficulty in accessing the adjudicative jurisdiction of the court, and cases where it arose from the rules of law which fell to be applied when he got there. The jurisprudence of the Strasbourg court establishes that, as a general rule, the question whether such cases amount to the creation of immunities engaging article 6 depends on whether the rule which prevents the litigant from succeeding is procedural or substantive: see, among other cases, Fayed v United Kingdom, at para 67; Al Adsani v United Kingdom (2002) 34 EHRR 11, para 47; Fogarty v United Kingdom (2001) 34 EHRR 12, para 25; Roche v United Kingdom (2005) 42 EHRR 30, paras 118 119; Markovic v Italy (2006) 44 EHRR 52, para 94. The dichotomy between procedural and substantive rules is not always as straightforward as it sounds, partly because the categories are not wholly distinct and partly because they do not exhaust the field. There may be rules of law, such as limitation, which are procedural in the sense that they bar the remedy, not the right, but which operate as a defence. There may be rules of law which require proceedings to be dismissed without consideration of the merits. These may be substantive rules, such as the foreign act of state doctrine, or procedural rules such as state immunity. There may be rules, whether substantive or procedural, which limit the territorial or subject matter jurisdiction of the domestic courts, and which they have no discretion to transgress. Or the claimants right may be circumscribed by a substantive defence, such as privilege in the law of defamation. Or he may simply have no legal right to assert under the domestic law, for example because the law is that no relevant duty is owed by a particular class of defendants although it would be by defendants generally. But these are not refinements with which the Strasbourg court has traditionally been concerned. What the Strasbourg court means by a procedural rule is a rule which, whether technically procedural or substantive in character, has the effect of barring a claim for reasons which do not go to its legal merits; that is to say, rules which do not define the existence or extent of any legal obligation. State immunity in the jurisprudence of the European Court of Human Rights State immunity is a mandatory rule of customary international law which defines the limits of a domestic courts jurisdiction. Unlike diplomatic immunity, which the modern law treats as serving an essentially functional purpose, state immunity does not derive from the need to protect the integrity of a foreign states governmental functions or the proper conduct of inter state relations. It derives from the sovereign equality of states. Par in parem non habet imperium. In the modern law the immunity does not extend to acts of a private law character. In respect of these, the state is subject to the territorial jurisdiction of the forum in the same way as any non state party. In Germany v Italy: Greece Intervening (Jurisdictional Immunities of the State) [2012] ICJ Rep 99, at para 59, the International Court of Justice observed that the rule occupies an important place in international law and international relations. It derives from the principle of sovereign equality of States, which, as article 2, para 1, of the Charter of the United Nations makes clear, is one of the fundamental principles of the international legal order. The rule, where it applies, is that a state may not be impleaded in a domestic court against its will. State immunity may be waived. But waiver does not dispense with the rule. It is inherent in the rule. It is a voluntary submission to the forum courts jurisdiction, which constitutes the consent that has always qualified the rule. The International Court of Justice has characterised state immunity as procedural: Democratic Republic of the Congo v Belgium (Arrest Warrant of 11 April 2000) [2002] ICJ Rep 3, paras 59 61; Germany v Italy: Greece Intervening (Jurisdictional Immunities of the State) [2012] ICJ Rep 99, at paras 92 97. This is correct, but state immunity is not procedural in the sense that the organisation and practices of the courts are procedural. It is procedural in the same sense as that concept has been used in the case law of the European Court of Human Rights. In other words, it requires the court to dismiss the claim without determining its merits. But it leaves intact the claimants legal rights and any relevant defences, which remain available, for example, to be adjudicated upon in the courts of the state itself. This gives rise to difficulty in a case where the rule goes to the courts jurisdiction. Proceedings brought against a state entitled to immunity are not a nullity. But the courts jurisdiction to entertain the proceedings is limited to examining the basis on which immunity is asserted and determining whether it applies. As the International Court of Justice put it in Jurisdictional Immunities of the State (para 60), the question whether the acts relied upon are such as to attract immunity must be determined before that jurisdiction can be exercised, whereas the legality or illegality of the act is something which can be determined only in the exercise of that jurisdiction. The impleaded state may consent to the proceedings. Where, however, it does not consent, there is no jurisdiction to proceed to the adjudicatory stage. The court must dismiss the claim. As Lord Bingham observed in Jones v Ministry of the Interior of the Kingdom of Saudi Arabia [2007] 1 AC 270, at para 14, article 6 cannot confer on a court a jurisdiction which it does not have, and a state cannot be said to deny access to its courts if it has no access to give. In Holland v Lampen Wolfe [2000] 1 WLR 1573, Lord Millett had put the matter in this way, at p 1588: Article 6 requires contracting states to maintain fair and public judicial processes and forbids them to deny individuals access to those processes for the determination of their civil rights. It presupposes that the contracting states have the powers of adjudication necessary to resolve the issues in dispute. But it does not confer on contracting states adjudicative powers which they do not possess. State immunity, as I have explained, is a creature of customary international law and derives from the equality of sovereign states. It is not a self imposed restriction on the jurisdiction of its courts which the United Kingdom has chosen to adopt. It is a limitation imposed from without upon the sovereignty of the United Kingdom itself. The immunity in question in the present case belongs to the United States. The United States has not waived its immunity. It is not a party to the Convention. The Convention derives its binding force from the consent of the contracting states. The United Kingdom cannot, by its own act of acceding to the Convention and without the consent of the United States, obtain a power of adjudication over the United States which international law denies it. The Strasbourg court has dealt with many cases involving claims to state immunity since it first grappled with these matters in Waite and Kennedy v Germany (2000) 30 EHRR 261. Although the reasoning has been somewhat modified over the years, its position has remained constant. Notwithstanding the difficulty pointed out in the preceding paragraph, it has always treated article 6 as being engaged by a successful claim to state immunity. But it has applied the Convention in the light of article 31(3) of the Vienna Convention of the Law of Treaties, which requires an international treaty to be interpreted in the light of (inter alia) any relevant rules of international law. Against that background, it has always held that the proper application of the rule of state immunity was justifiable because it was derived from a fundamental principle of international law. The only cases in which it has ever held article 6 to have been violated are those in which it has found that a claim to state immunity was unfounded in international law. It is convenient to start with three judgments delivered on the same day by a similarly constituted Grand Chamber: Al Adsani v United Kingdom (2001) 34 EHRR 11, McElhinney v Ireland (2001) 34 EHRR 13 and Fogarty v United Kingdom (2001) 34 EHRR 12. In Al Adsani, the applicant had been barred by state immunity from proceeding in England against the government of Kuwait in an action claiming damages for torture. The Court held (para 48) that article 6 was engaged, because the grant of immunity is seen not as qualifying a substantive right but as a procedural bar on the national courts power to determine the right. It rejected the submission of the British government (para 44) that article 6 could not extend to matters which under international law lay outside the jurisdiction of the state. However, it held that the bar was justifiable, for reasons stated at paras 54 56: 54. The Court must first examine whether the limitation pursued a legitimate aim. It notes in this connection that sovereign immunity is a concept of international law, developed out of the principle par in parem non habet imperium, by virtue of which one State shall not be subject to the jurisdiction of another State. The Court considers that the grant of sovereign immunity to a State in civil proceedings pursues the legitimate aim of complying with international law to promote comity and good relations between States through the respect of another States sovereignty. 55. The Court must next assess whether the restriction was proportionate to the aim pursued. It recalls that the Convention has to be interpreted in the light of the rules set out in the Vienna Convention of 23 May 1969 on the Law of Treaties, and that article 31(3)(c) of that treaty indicates that account is to be taken of any relevant rules of international law applicable in the relations between the parties. The Convention, in including article 6, cannot be interpreted in a vacuum. The Court must be mindful of the Conventions special character as a human rights treaty, and it must also take the relevant rules of international law into account. The Convention should so far as possible be interpreted in harmony with other rules of international law of which it forms part, including those relating to the grant of State immunity. It follows that measures taken by a High Contracting 56. Party which reflect generally recognised rules of public international law on State immunity cannot in principle be regarded as imposing a disproportionate restriction on the right of access to court as embodied in article 6(1). Just as the right of access to court is an inherent part of the fair trial guarantee in that article, so some restrictions on access must likewise be regarded as inherent, an example being those limitations generally accepted by the community of nations as part of the doctrine of State immunity. McElhinney v Ireland (2001) 34 EHRR 13 arose out of a claim against the British government in the courts of Ireland for psychological injury arising from an incident at the border with Northern Ireland. The Court rejected the allegation that by upholding the assertion of immunity the Irish court had violated article 6, in language substantially identical to that employed in Al Adsani. Fogarty v United Kingdom (2001) 34 EHRR 12 was the first of a number of cases to come before the Strasbourg court involving employment disputes between a state and non diplomatic staff at one of its embassies. It concerned a sex discrimination claim brought in England against the United States by a secretary employed at US embassy in London. Once again, the Court held in substantially identical language that article 6(1) was engaged but not violated. The importance of the decision for present purposes lies in the additional observations which the Court addressed specifically to diplomatic employment disputes. The Court said at para 37 that: on the material before it, there appears to be a trend in international and comparative law towards limiting State immunity in respect of employment related disputes. However, where the proceedings relate to employment in a foreign mission or embassy, international practice is divided on the question whether State immunity continues to apply and, if it does so apply, whether it covers disputes relating to the contracts of all staff or only more senior members of the mission. Certainly, it cannot be said that the United Kingdom is alone in holding that immunity attaches to suits by employees at diplomatic missions or that, in affording such immunity, the United Kingdom falls outside any currently accepted international standards. That being so the Court concluded (para 39) that in conferring immunity on the United States in the present case by virtue of the provisions of the 1978 Act, the United Kingdom cannot be said to have exceeded the margin of appreciation allowed to States in limiting an individual's access to court. These observations are consistent with the view that in the absence of a recognised rule of customary international law, article 6 is satisfied if the rule applied by a Convention state lies within the range of possible rules consistent with current international standards. The first case in which the European Court of Human Rights held that the recognition of state immunity violated article 6(1) of the Convention was Cudak v Lithuania (2010) 51 EHRR 15. The applicant was a secretary and switchboard operator employed in the Polish embassy in Vilnius, Lithuania. The Supreme Court of Lithuanias decision appears to have been closely based on the Strasbourg courts decision in Fogarty. It had upheld Polands claim to state immunity on the ground that: there was no uniform international practice of states whereby the members of staff of foreign states diplomatic missions who participated in the exercise of the public authority of the states they represented could be distinguished from other members of staff. As there were no legally binding international rules, it was for each state to take its own decisions in such matters. (para 24) The European Court of Human Rights reiterated the general principles governing the application of article 6 in such cases, which they had previously laid down in Fogarty. They held that although that had been a complaint about the employers recruitment practices, the same principles applied to claims arising out of a subsisting employment relationship. However, they held that the Lithuanian courts had exceeded the margin of appreciation available to them. The reason was that there were now binding international rules on contracts of employment. The court found these rules in article 11 of the International Law Commissions draft articles of 1991 on Jurisdictional Immunities of States and their Property. The draft articles were part of the travaux preparatoires for what ultimately became, 13 years later, the United Nations Convention. Draft article 11(1) provided that there was no immunity in respect of contracts of employment to be performed in the forum state, save in five cases specified in draft article 11(2). The five cases were: (a) the employee has been recruited to perform functions closely related to the exercise of governmental authority; the subject of the proceeding is the recruitment, renewal (b) of employment or reinstatement of an individual; (c) the employee was neither a national nor a habitual resident of the State of the forum at the time when the contract of employment was concluded; (d) time when the proceeding is instituted; or (e) the employer State and the employee have otherwise agreed in writing, subject to any considerations of public policy conferring on the courts of the State of the forum exclusive jurisdiction by reason of the subject matter of the proceeding. the employee is a national of the employer State at the The Strasbourg court recognised that the draft articles were not a treaty and that Lithuania had not ratified the Convention ultimately adopted. But it held that article 11 was nevertheless binding on the state because it reflected customary international law: see paras 64 67. The court considered that none of the five exceptions in draft article 11(2) applied. In particular, exception (a) did not apply. It then reviewed the Lithuanian Supreme Courts findings of fact and concluded that it had given inadequate reasons for regarding the applicants employment as being related to the exercise of governmental authority: 70. The Court observes in particular that the applicant was a switchboard operator at the Polish Embassy whose main duties were: recording international conversations, typing, sending and receiving faxes, photocopying documents, providing information and assisting with the organisation of certain events. Neither the Lithuanian Supreme Court nor the respondent Government have shown how these duties could objectively have been related to the sovereign interests of the Polish Government. Whilst the schedule to the employment contract stated that the applicant could have been called upon to do other work at the request of the head of mission, it does not appear from the case file nor has the Government provided any details in this connection that she actually performed any functions related to the exercise of sovereignty by the Polish State. In its judgment of June 25, 2001 the Supreme Court 71. stated that, in order to determine whether or not it had jurisdiction to hear employment disputes involving a foreign mission or embassy, it was necessary to establish in each case whether the employment relationship in question was one of a public law nature (acta jure imperii) or of a private law nature (acta jure gestionis). In the present case, however, the Supreme Court found that it had been unable to obtain any information allowing it to establish the scope of the applicant's actual duties. It therefore referred solely to the title of her position, and to the fact that Poland had invoked immunity from jurisdiction, in concluding that the duties entrusted to her had facilitated, to a certain degree, the exercise by the Republic of Poland of its sovereign functions. Some further explanation is called for concerning the Strasbourg Courts treatment of the ILCs draft articles of 1991, since it is criticised by Ms Karen Steyn QC, for the Secretary of State on grounds that I think misunderstand it. The Court began its observations on this question by noting (para 64) that the application of absolute state immunity has, for many years, clearly been eroded. This is a reference to the progressive adoption of the restrictive doctrine. The court treated draft article 11 as reflecting the adoption of the restrictive doctrine in the domain of employment. As regards the critical parts of draft article 11, this is plainly correct. The exceptions which were relevant in Ms Cudaks case were (a) and (b). Of these, (a) directly imported the classic distinction between acts jure imperii and acts jure gestionis. As to (b), the International Law Commissions commentary on the draft articles suggested that it confirmed the existing practice of states by which state immunity extended to the recruitment, renewal of employment and reinstatement of an employee, these being dependent on policy considerations lying within a states discretionary power and likely to have been determined as an exercise of governmental authority. A substantial body of domestic case law from various jurisdictions is cited in support of this statement: see Report of the International Law Commission on the work of its forty third session, 29 April 19 July 1991 [A/46/10], pp 43 44, para (10). The Strasbourg court presumably based its reasoning on the draft articles of 1991 rather than the final text of the Convention because the relevant proceedings in Lithuania occurred in 2000 and 2001, before the final text of the Convention was adopted. But although the final text of article 11 differs in significant respects from the draft article, exception (a) is substantially the same in the final version, and exception (b) (renumbered (c)) is identical. The Court was therefore right to regard these provisions of draft article 11 as applying the restrictive doctrine of state immunity to contracts of employment, and as foreshadowing, in that respect, the terms of the Convention. I do not read the Strasbourg Court as having assumed that everything else in draft article 11 was declaratory of existing customary international law. It did not need to, because the other exceptions in article 11(2) did not affect the issue. Ms Cudak appears to have been a national of or habitually resident in Lithuania, and there was no contractual submission to the local forum. Exceptions (c), (d) and (e) therefore did not arise. Sabeh El Leil v France (2011) 54 EHRR 14 arose out of another unfair dismissal claim, this time brought in the French courts by the head of the accounts department of the Kuwaiti embassy in Paris. In this case, the final decision of the French courts barring the claim on grounds of state immunity was handed down after the adoption of the United Nations Convention. After reiterating the principle on which the Strasbourg court had always held article 6 to be engaged in such cases, the Grand Chamber summarised its case law as follows (paras 51 52): 51. Therefore, in cases where the application of the rule of state immunity from jurisdiction restricts the exercise of the right of access to a court, the Court must ascertain whether the circumstances of the case justified such restriction. 52. The Court further reiterates that such limitation must pursue a legitimate aim and that state immunity was developed in international law out of the principle par in parem non habet imperium, by virtue of which one state could not be subject to the jurisdiction of another. It has taken the view that the grant of immunity to a state in civil proceedings pursues the legitimate aim of complying with international law to promote comity and good relations between states through the respect of another state's sovereignty. The Court then restated the view which it had taken in Cudak, that article 11 of the ILCs draft articles of 1991, as now enshrined in the 2004 Convention represented customary international law binding as such even on those states (such as France) which had not ratified it at the relevant time. In saying this, the Court must have had in mind exceptions (a) and (b) in draft article 11(2), since these are the only potentially relevant exceptions subsequently enshrined in the Convention. The rest of article 11(2) in the final version is very different from the draft. The Court found that article 6 had been violated because the Cour de Cassation had not had regard to customary international law as embodied in article 11 of the United Nations Convention and had not given adequate reasons for finding that some of the applicants duties involved participating in exercises of governmental authority. The reasoning in Cudak and Sabeh el Leil was subsequently applied by the Strasbourg court in Wallishauser v Austria (Application 156/04, Judgment of 19 Nov 2012) and Radunovi v Montenegro (Applications 45197/13, 53000/13 and 73404/13, Judgment 25 Oct 2016), all of them cases involving technical and administrative staff of a foreign embassy. The Court of Appeal in the present cases thought that it was questionable whether article 11 of the draft articles was in fact a definitive statement of customary international law in embassy employment disputes. For my part, I would agree that some of the Strasbourg courts observations about article 11 have simply served to sow confusion. Article 11 codifies customary international law so far as it applies the restrictive doctrine to contracts of employment. That would have been enough for Ms Cudaks and Mr El Leils purposes. So far as article 11 goes beyond the application of the restrictive doctrine, its status is uncertain. I shall expand on this point below. It would perhaps have been better if the Strasbourg court had simply said that employment disputes should be dealt with in accordance with the restrictive doctrine instead of in accordance with an article of a treaty which is not in force and which a large majority of states have neither signed nor ratified. But this is a point of presentation, not of substance. The Threshold Issue: Jurisdiction Ms Steyn for the Secretary of State has raised a threshold issue. She contends that a decision of a domestic court that a state is entitled to immunity does not engage article 6 at all, because its effect is that there is no jurisdiction capable of being exercised and no access to a court capable of being withheld. As I have pointed out, this is a point which was powerfully made in the House of Lords in Holland v Lampen Wolfe [2000] 1 WLR 1573 and Jones v Saudi Arabia [2007] 1 AC 270, but was rejected by the Grand Chamber in Al Adsani. In Jones v United Kingdom (2014) 59 EHRR 1, a chamber of the European Court of Human Rights was invited to depart from Al Adsani on this point, but it declined to do so, adhering to its long standing distinction between procedural and substantive bars to the exercise of jurisdiction. Ms Steyn now invites us to resolve this issue in accordance with the views of the House of Lords. In my view, there may well come a time when this court has to choose between the view of the House of Lords and that of the European Court of Human Rights on this fundamental question. But the premise on which the question arises is that there is a rule of international law which denies the English court jurisdiction in the instant case. In both Jones and Lampen Wolfe, the Appellate Committee had satisfied itself that there was. I would not be willing to decide which of the competing views about the implications of a want of jurisdiction is correct, unless the question actually arose. So the first question which I shall address is what is the relevant rule of international law. Identifying Customary International Law To identify a rule of customary international law, it is necessary to establish that there is a widespread, representative and consistent practice of states on the point in question, which is accepted by them on the footing that it is a legal obligation (opinio juris): see Conclusions 8 and 9 of the International Law Commissions Draft Conclusions on Identification of Customary International Law (2016) [A/71/10]. There has never been any clearly defined rule about what degree of consensus is required. The editors of Brownlies Principles of Public International Law, 8th ed (2012), 24, suggest that complete uniformity of practice is not required, but substantial uniformity is. This accords with all the authorities. In the words of the International Court of Justice The Court does not consider that, for a rule to be established as customary, the corresponding practice must be in absolutely rigorous conformity with the rule. In order to deduce the existence of customary rules, the Court deems it sufficient that the conduct of States should, in general, be consistent with such rules, and that instances of State conduct inconsistent with a given rule should generally have been treated as breaches of that rule, not as indications of the recognition of a new rule: Military and Paramilitary Activities in and against Nicaragua (Nicaragua v United States of America), (1986) ICJ Rep, 14, at para 186. What is clear is that substantial differences of practice and opinion within the international community upon a given principle are not consistent with that principle being law: Fisheries Case (United Kingdom v Norway), (1951) ICJ Rep 116, 131. In view of the emphasis placed by the European Court of Human Rights on the United Nations Convention and its antecedent drafts, it is right to point out that a treaty may have no effect qua treaty but nevertheless represent customary international law and as such bind non party states. The International Law Commissions Draft Conclusions on Identification of Customary International Law (2016) [A/71/10], propose as Conclusion 11(1): A rule set forth in a treaty may reflect a rule of customary international law if it is established that the treaty rule: (a) codified a rule of customary international law existing at the time when the treaty was concluded; (b) has led to the crystallization of a rule of customary international law that had started to emerge prior to the conclusion of the treaty; or (c) has given rise to a general practice that is accepted as law (opinio juris) thus generating a new rule of customary international law. It would be difficult to say that a treaty such as the United Nations Convention which has never entered into force had led to the crystallisation of a rule of customary international law that had started to emerge before it was concluded. For the same reason, it is unlikely that such a treaty could have given rise to a general practice that is accepted as law. These difficulties are greatly increased in the case of the United Nations Convention by the consideration that in the 13 years which have passed since it was adopted and opened for signature it has received so few accessions. The real significance of the Convention is as a codification of customary international law. In Jones v Ministry of the Interior of the Kingdom of Saudi Arabia [2007] 1 AC 270, Lord Bingham described it (para 26) as the most authoritative statement available on the current international understanding of the limits of state immunity in civil cases. However, it is not to be assumed that every part of the Convention restates customary international law. As its preamble recites, it was expected to contribute to the codification and development of international law and the harmonisation of practice in this area. Like most multilateral conventions, its provisions are based partly on existing customary rules of general acceptance and partly on the resolution of points on which practice and opinion had previously been diverse. It is therefore necessary to distinguish between those provisions of the Convention which were essentially declaratory and those which were legislative in the sense that they sought to resolve differences rather than to recognise existing consensus. That exercise would inevitably require one to ascertain how customary law stood before the treaty. The margin of appreciation: a tenable view The Secretary of States case is that there is no sufficient consensus on the application of state immunity to a contract for the employment of non diplomatic staff of a foreign diplomatic mission, to found any rule of customary international law on the point. He submits that two consequences follow from this. The first is that article 6 of the Human Rights Convention is satisfied if the rule of the forum state reflects generally recognised principles of international law. For this purpose, it is enough for the forum state to apply a tenable view of what international law is, or at any rate that its domestic law applies a solution that is not outside the currently accepted international standards treated as a benchmark in Fogarty. He submits that it is not necessary to show that international law requires the foreign state to be treated as immune. The second consequence is said to be that in the absence of a rule of customary international law justifying some other solution, the state employer is entitled to absolute immunity. This is because, in the Secretary of States submission, the restrictive doctrine of state immunity operates by grafting exceptions onto the principle of absolute immunity, so that unless and until a relevant exception has achieved the status of customary international law, the immunity remains unqualified. I can deal quite shortly with the suggested distinction between reflects and requires, for in my opinion it is misconceived. The argument is based on the observation of the European Court of Human Rights in Al Adsani (para 56) that measures taken by a High Contracting Party which reflect generally recognised rules of public international law are within a states margin of appreciation. That observation is repeated in most of the subsequent cases: see Fogarty (para 36), Cudak (para 57), Sabeh El Leil (para 49). But in my view the distinction proposed by the Secretary of State is a purely semantic one. International law is relevant to the operation of article 6 of the Human Rights Convention because, in accordance with article 31(3)(c) of the Vienna Convention on the Law of Treaties, the Human Rights Convention is interpreted in the light of any relevant rules of international law applicable in the relations between the parties. It is therefore necessary to ask what is the relevant rule of international law by reference to which article 6 must be interpreted. The relevant rule is that if the foreign state is immune then, as the International Court of Justice has confirmed in Jurisdictional Immunities of the State, the forum state is not just entitled but bound to give effect to that immunity. If the foreign state is not immune, there is no relevant rule of international law at all. What justifies the denial of access to a court is the international law obligation of the forum state to give effect to a justified assertion of immunity. A mere liberty to treat the foreign state as immune could not have that effect, because in that case the denial of access would be a discretionary choice on the part of the forum state: see Al Jedda v United Kingdom (2011) 53 EHRR 23; Nada v Switzerland (2012) 56 EHRR 593, paras 180, 195; Perincek v Switzerland (2016) 63 EHRR 6, paras 258 259. To put the same point another way, if the legitimate purpose said to justify denying access to a court is compliance with international law, anything that goes further in that direction than international law requires is necessarily disproportionate. I conclude that unless international law requires the United Kingdom to treat Libya and Sudan as immune as regards the claims of Ms Janah and Ms Benkharbouche, the denial to them of access to the courts to adjudicate on their claim violates article 6 of the Human Rights Convention. There are circumstances in which an English court considering the international law obligations of the United Kingdom may properly limit itself to asking whether the United Kingdom has acted on a tenable view of those obligations. A suggestion to this effect by Sir Philip Sales and Joanne Clement, International law in domestic courts: the developing framework (2008) 124 LQR 388, 405 407 was tentatively endorsed by Lord Brown of Eaton under Heywood in R (Corner House Research) v Serious Fraud Office [2009] 1 AC 756, at para 68. Thus the court may in principle be reluctant to decide contentious issues of international law if that would impede the executive conduct of foreign relations. Or the rationality of a public authoritys view on a difficult question of international law may depend on whether its view of international law was tenable, rather than whether it was right. Both of these points arose in Corner House. Or the court may be unwilling to pronounce upon an uncertain point of customary international law which only a consensus of states can resolve. As Lord Hoffmann observed in Jones v Saudi Arabia (para 63), it is not for a national court to develop international law by unilaterally adopting a version of that law which, however desirable, forward looking and reflective of values it may be, is simply not accepted by other states. But I decline to treat these examples as pointing to a more general rule that the English courts should not determine points of customary international law but only the tenability of some particular view about them. If it is necessary to decide a point of international law in order to resolve a justiciable issue and there is an ascertainable answer, then the court is bound to supply that answer. In the present cases, the law requires us to measure sections 4(2)(b) and 16(1)(a) against the requirements of customary international law, something that we cannot do without deciding what those requirements are. I do not read the Strasbourg court as having said anything very different in Fogarty. The court considered (para 37) that although there had been a trend in favour of the restrictive doctrine of state immunity, there was too much diversity of state practice in the specific area of embassy staff to enable them to say that the restrictive doctrine applied to them. In those circumstances they thought it sufficient that the United Kingdom had acted on a view of international law which, although not the only possible one, was within currently accepted international standards. But this is not the same point as the one made by the Secretary of State, for it applies only if there is no relevant and identifiable rule of international law. If there is such a rule, the court must identify it and determine whether it justifies the application of state immunity. That is what the Strasbourg court did in Cudak and Sabeh El Leil, and what it criticised the Lithuanian Supreme Court and the French Court de Cassation for failing to do in those cases. For reasons which I shall explain, I find the view expressed in Fogarty that there was no relevant and identifiable rule of international law surprising, but that is another matter. The starting point: absolute or restrictive immunity? The fundamental difference between the parties to this appeal concerns the starting point. On the footing that customary international law must require the United Kingdom to treat Libya and Sudan as immune, the Secretary of State submits that it does. This is because in his submission state immunity is absolute unless the case is brought within an internationally recognised exception to it. This submission, if it is correct, would considerably broaden the scope of state immunity in customary international law, by extending it to any group of claimants about whom there was a diversity of state practice. But in my view, it is not correct. The rule of customary international law is that a state is entitled to immunity only in respect of acts done in the exercise of sovereign authority. In the absence of a special rule to some different effect applicable to employees in the position of Ms Janah and Ms Benkharbouche, that is the default position. It is true that the State Immunity Act 1978 adopts the drafting technique of stating a presumptive immunity subject to exceptions. Section 1 provides that a state is immune except as provided in the following sections of Part I. The same drafting technique is employed in other national legislation, especially in common law jurisdictions, for example the United States, Canada and Australia. As applied to international law, the submission is lent a certain superficial plausibility by the fact that the United Nations Convention has adopted the same drafting technique. Article 5 provides for a general immunity subject to the provisions of this Convention. In Jones v Saudi Arabia, Lord Bingham relied on the way that the United Nations Convention was drafted as showing that a state was immune in respect of everything that was not the subject of an express exception, and concluded that the immunity extended to torture because torture was not the subject of any express exception: see paras 8 9 (Lord Bingham), and cf para 47 (Lord Hoffmann). I do not regard these considerations as decisive of the present issue. No one doubts that as a matter of domestic law, Part I of the State Immunity Act is a complete code. If the case does not fall within one of the exceptions to section 1, the state is immune. But the present question is whether the immunity thus conferred is wider than customary international law requires, and that raises different considerations. In the first place, it is necessary to read the grant of the immunity in article 5 of the United Nations Convention together with the exceptions which follow, as an organic whole. The exceptions are so fundamental in their character, so consistent in their objective and so broad in their effect as to amount in reality to a qualification of the principle of immunity itself rather than a mere collection of special exceptions. Secondly, it is important when doing this to distinguish between a drafting technique and a principle of law. The travaux prparatoires of the United Nations Convention show that the technique of stating a general rule of immunity subject to exceptions, was highly contentious. This was partly because it might be taken as an implicit recognition that absolute immunity was the basic rule, something which many states did not accept; and partly because it was thought that it would lead to undue rigidity and thereby impede the future development of customary international law. These differences are summarised in the Report of the International Law Commission on the Work of its thirty eighth session [A/41/10] ILC Yearbook (1986), ii(2), 16, and in the valuable commentary of OKeefe and Tams (ed), The United Nations Convention of Jurisdictional Immunities of States and their Property (2013), 99 101. It is clear that the draftsmans objective was to remain neutral as between the competing doctrines said to represent the current state of international law. Various proposals were made with a view to achieving this and avoiding undue rigidity. In particular, it was proposed that what became article 5 should provide that a state was immune subject to the provisions of the present articles [and the relevant rules of general international law applicable in the matter]. This provoked much discord, and the bracketed words were ultimately dropped on the ground that they made no difference. In its commentary on the draft articles of 1991, the International Law Commission explained that this was because it was considered that any immunity or exception to immunity accorded under the present articles would have no effect on general international law and would not prejudice the future development of State practice Article 5 is also to be understood as the statement of the principle of State immunity forming the basis of the present draft articles and does not prejudge the question of the extent to which the articles, including article 5, should be regarded as codifying the rules of existing international law. Draft articles on Jurisdictional Immunities of States and their Property, with commentaries (1991), 23 (para (3) under article 5) Thirdly, as I have already observed, the United Nations Convention has for the time being no binding effect qua treaty. All that can be said about it is that so far as it seeks to codify existing customary international law, it is evidence of what that law is. But even where it is declaratory, it can never be definitive, if only in order to allow for the future development of state practice. Hence the fifth recital in its preamble (Affirming that the rules of customary law continue to govern matters not regulated by the provisions of the present Convention), which was inserted in the course of the debates about article 11 to which I have referred. Fourthly, the House of Lords in Jones v Saudi Arabia was not concerned with the question whether the starting point was absolute or restrictive immunity. It was concerned with the question whether torture and other breaches of peremptory norms of international law constituted an implied additional limitation upon an immunity which was unquestionably recognised by international law. Without an implied limitation of this kind, a state would have been immune in international law as regards an allegation of torture under either the absolute or the restrictive doctrine because, as the House of Lords held, torture is by definition a governmental act: see paras 16, 19 (Lord Bingham), and 83 85 (Lord Hoffmann). The main difficulty about the Secretary of States submission is a more fundamental one, namely that it is not consistent with the way that the law of state immunity has developed. Unlike diplomatic immunity, which is based mainly on an international consensus established by writers and governmental practice over many centuries, state immunity was developed during the nineteenth and twentieth centuries primarily by municipal courts. In the words of the Special Rapporteur of the International Law Commission, presenting in 1980 the first draft of what became the United Nations Convention, their decisions constituted a great and divergent volume of municipal jurisprudence: [A/35/10] ILC Yearbook (1980), ii(2), 143. Before the age of state trading organisations, there were few occasions for testing the limits of state immunity. States rarely did acts in peacetime within the territory of other states, other than conduct diplomatic relations, and that was the subject of a distinct and far older international law immunity. Leaving aside the rather special case of the immunity of personal sovereigns visiting the forum state, the only other acts which a sovereign performed in the territory of another state involved the presence of state owned ships in its ports or the placing of public procurement contracts. The latter were generally for military or diplomatic purposes, and were therefore closely related to the inherently governmental acts of the state, even if they were strictly speaking acts of a private law character. The earliest notable landmark was the judgment of the Supreme Court of the United States in The Schooner Exchange v McFaddon 11 US 116 (1812), delivered by Chief Justice Marshall. The Exchange was a trading vessel belonging to two American merchants, which was captured at sea by French ships of war, converted into an armed cruiser and incorporated into the French navy. When the ship put in to the port of Philadelphia, its former owners claimed possession. The Supreme Court held that a ship of war in the possession of a foreign state was immune from any proceedings in rem. Marshall CJ founded the rule on an implied exception to the territorial sovereignty of states for certain classes of act done there by a foreign state, which was based on the usages and received obligations of the civilised world. At pp 144 145, he drew a distinction between trading vessels and ships of war. It may safely be affirmed that there is a manifest distinction between the private property of the person who happens to be a prince and that military force which supports the sovereign power and maintains the dignity and the independence of a nation. A prince, by acquiring private property in a foreign country, may possibly be considered as subjecting that property to the territorial jurisdiction; he may be considered as so far laying down the prince and assuming the character of a private individual, but this he cannot be presumed to do with respect to any portion of that armed force which upholds his Crown and the nation he is entrusted to govern. The Exchange was a decision on the immunity of the property of a foreign state, a context in which the immunities recognised by international law have generally been wider than those available in actions for breach of duty. But it will be seen even in that context, at its origins the immunity was not conceived to be absolute. It was assumed to extend only to property employed for public or governmental purposes. The same assumption was made in the earliest English cases. In Duke of Brunswick v King of Hanover (1848) 2 HL Cas 1 the House of Lords held, in the words of Lord Chancellor Cottenham (p 17), that a foreign Sovereign, coming into this country, cannot be made responsible here for an act done in his sovereign character in his own country; whether it be an act right or wrong, whether according to the constitution of that country or not, the Courts of this country cannot sit in judgment upon an act of a Sovereign, effected by virtue of his Sovereign authority abroad. In De Haber v Queen of Portugal (1851) 7 QB 196, 207 Lord Campbell CJ gave it as his opinion that an action cannot be maintained in any English Court against a foreign potentate, for anything done or omitted to be done by him in his public capacity as representative of the nation of which he is the head; and that no English Court has jurisdiction to entertain any complaints against him in that capacity. The question whether a corresponding immunity applied to a sovereigns non sovereign acts arose for the first time in England in The Charkieh (1872 5) LR 4 A & E 59, a collision action brought against a ship which belonged to the Khedive of Egypt and flew the flag of the Ottoman navy, but was employed for ordinary commercial purposes and at the time was under charter to a British trading house. Sir Robert Phillimore, sitting in the Admiralty Court, held that the vessel was not immune because the Khedive was not a sovereign but an officer of the Ottoman Porte. However, he went on to hold that there would have been no immunity in any event, because the use of state property for trading purposes was an implicit waiver of any immunity attaching to the state. At pp 99 100, he stated that no principle of international law, and no decided case, and no dictum of jurists of which I am aware, has gone so far as to authorize a sovereign prince to assume the character of a trader, when it is for his benefit; and when he incurs an obligation to a private subject to throw off, if I may so speak, his disguise, and appear as a sovereign, claiming for his own benefit, and to the injury of a private person, for the first time, all the attributes of his character. Six years later, Sir Robert had to deal with the same issue in The Parlement Belge (1879) 4 PD 129, another collision action brought against a ship belonging to the Belgian state, which was employed as a mail packet but also carried some passengers and freight. He followed his own judgment in The Charkieh, holding that any immunity would not include a vessel engaged in commerce, whose owner is (to use the expression of Bynkershoek, De Leg Mercatore) strenue mercatorem agens. The Court of Appeal overruled this decision. The judgment of the court (delivered by Brett LJ) was authority for two points. The first, which was technically obiter dictum, was that by extension from the personal immunity of an ambassador, which at that time was absolute, the courts could not exercise any jurisdiction in personam against a sovereign. The second, which was the ratio of the decision, was that immunity extended to proceedings in rem against the public property of any state which is destined to public use. The ground on which the appeal was allowed was that the vessel was employed substantially for public purposes as a mail packet. The court declined to decide whether it would have been immune if it had been used wholly or substantially for ordinary trading. It was enough that the incidental carriage of passengers and freight did not deprive Belgium of the immunity to which the substantially public purpose of its operations entitled it. Cf the analysis of the decision by Lord Cross of Chelsea, delivering the advice of the Privy Council in The Philippine Admiral [1977] AC 377, 391 392. Nonetheless, the Parlement Belge was for many years regarded as authority for the absolute immunity of state property. The extreme point of this tendency was reached with the decision of the Court of Appeal in The Porto Alexandre [1920] P 30. In that case there was no suggestion that the vessel was in use for any public purpose. She was engaged in ordinary trading operations. But the Parlement Belge was treated as warranting the absolute immunity of state owned ships from actions in rem. The decision provoked controversy well before the Privy Council held in The Philippine Admiral [1977] AC 373 that it had been wrongly decided. In Compania Naviera Vascongada v Steamship Cristina (The Cristina) [1938] AC 485, a Spanish trading ship had been requisitioned by the Spanish government while on the high seas in order to assist the republican government of Spain to put down the nationalist rebellion. Possession of her had then been taken in the port of Cardiff by the Spanish consul there. The speeches need to be read in conjunction with the fuller account of the facts and arguments which are reported at (1938) 60 Lloyds Rep 147. It was not in doubt that the Spanish consul had taken possession of it for public purposes. The real issues were whether an action in rem against a state owned ship impleaded the foreign state; and whether the English courts should recognise an extraterritorial decree of the Spanish state. The House of Lords rejected the argument about the extraterritorial operation of the decree, and dismissed the action on the ground (i) that an action in rem against a state owned ship indirectly impleaded the state, or indeed (per Lord Wright, at p 505) directly impleaded it; and (ii) that however she had previously been employed by her owners, she was intended for public purposes in the hands of the Spanish government. An action for possession could not therefore proceed. The interest of the case for present purposes lies in the divergence of views about the Porto Alexandre. Lord Atkin and Lord Wright considered that the immunity of states was absolute and applied irrespective of the purpose for which a ship was in the states possession. But the other members of the Appellate Committee doubted this, primarily on the ground that it could be correct only if there was a sufficient international consensus to that effect. However, no attempt had been made in the earlier cases to establish that there was. Lord Thankerton observed (pp 495 496) that it may be argued that the judgment of Brett LJ in the Parlement Belge did not authorise the extension of state immunity to property in commercial use since proceedings against such property were not to be regarded as inconsistent with the independence and equality of the state represented by such owner. He pointed out that the Court of Appeal in the Porto Alexandre had made no inquiry as to whether such an exemption was generally agreed to by the nations, and it seems to be common knowledge that they have not so agreed. Lord Macmillan shared these doubts, remarking at p 498: I confess that I should hesitate to lay down that it is part of the law of England that an ordinary foreign trading vessel is immune from civil process within this realm by reason merely of the fact that it is owned by a foreign State, for such a principle must be an importation from international law and there is no proved consensus of international opinion or practice to this effect. On the contrary the subject is one on which divergent views exist and have been expressed among the nations. When the doctrine of the immunity of the person and property of foreign sovereigns from the jurisdiction of the Courts of this country was first formulated and accepted it was a concession to the dignity, equality and independence of foreign sovereigns which the comity of nations enjoined. It is only in modern times that sovereign States have so far condescended to lay aside their dignity as to enter the competitive markets of commerce, and it is easy to see that different views may be taken as to whether an immunity conceded in one set of circumstances should to the same extent be enjoyed in totally different circumstances. Lord Maugham said (pp 519 520): My Lords, I cannot myself doubt that, if the Parlement Belge had been used solely for trading purposes, the decision would have been the other way. Almost every line of the judgment would have been otiose if the view of the Court had been that all ships belonging to a foreign Government even if used purely for commerce were entitled to immunity The judgments in The Porto Alexandre seem to me to have omitted any consideration of what I deem to be a vital point namely, the fact that other countries while they admit the immunity as regards ships of war and other public ships have not been at all agreed that the same immunity ought to be granted to ships and cargoes engaged in ordinary trading voyages. In this uncertain state of English law, Lord Simon, delivering the advice of the Privy Council in Sultan of Johore v Abubakar Tunku Aris Bendahar [1952] AC 318, 343, observed: Their Lordships do not consider that there has been finally established in England any absolute rule that a foreign independent sovereign cannot be impleaded in our courts in any circumstances. It seems desirable to say this much having regard to inferences that might be drawn from some parts of the Court of Appeals judgment in The Parlement Belge, and from the speech of Lord Atkin in The Cristina. The doubts expressed in The Cristina by Lord Thankerton, Lord Macmillan and Lord Maugham about the international law basis for a rule of absolute immunity were justified, as a review of pre 1945 decisions in different jurisdictions demonstrates. For what follows, I am indebted to the extensive reviews of this large body of material by Sir Hersch Lauterpacht in his influential article The Problem of Jurisdictional Immunities of Foreign States, 28 BYIL (1951), 220, 250 272, by the German Bundesverfassungsgericht in Claim against the Empire of Iran (1963), Entscheidungen des Bundesverfassungsgerichts, 16 (1964), 27 (partially translated in 45 ILR 257), and by Fox, The Law of State Immunity, 3rd ed (2013), Ch 6, and Dunbar, Controversial Aspects of Sovereign Immunity in the Case law of some States, (1971) 132 Recueil des Cours, 197. Broadly speaking, these show that states which adopted the absolute doctrine of state immunity generally did so on one or other of two grounds. One was that the sovereign equality of states implied an entire absence of jurisdiction by the courts on one state over another. The other was that while there was in principle a distinction between the public and private acts of a state, the distinction should depend on the states purpose in doing the relevant act and not on its juridical character, so that even trading activities were immune if they were carried on in the public interest. The two approaches are very different but in practice they lead to the same result, except perhaps in the case of the private acts of personal sovereigns. As far as the common law world is concerned, the English courts, after a period of hesitation, finally opted for the first analysis. In British dependencies and dominions, the absolute doctrine of state immunity was generally adopted in line with what was assumed to have been laid down in The Parlement Belge. In the United States, the absolute doctrine had a more chequered history, but it ultimately adopted the second analysis. The State Departments traditional approach to the question of state owned ships was described in a communication addressed by the Secretary of State to the Attorney General in 1918, stating that where [state owned] vessels were engaged in commercial pursuits, they should be subject to the obligations and restrictions of trade, if they were to enjoy the benefits and profits. Instructions to this effect were given to United States diplomatic and consular officers abroad: see Hackworth, Digest of International Law, ii (1941), 429, 439 440. This only changed with the decision of the United States Supreme Court in Berizzi Brothers Co v Steamship Pesaro, 271 US 562 (1926), an action in rem in support of a cargo claim against a trading vessel owned by the Italian state. The State Department had refused, in accordance with its traditional practice, to certify that the ship was immune, on the ground that vessels owned by a state and engaged in commerce are not entitled, within the territorial waters of another state, to the immunity accorded to vessels of war, and that notwithstanding such ownership these vessels are subject to the local jurisdiction to the same extent as other merchant vessels: Hackworth, op cit, ii, 437. But the Supreme Court upheld the claim to immunity. The Court adopted The Parlement Belge, as it had been interpreted in subsequent English case law, including The Porto Alexandre. It accepted in principle the distinction between ships operated for public and private purposes which dated back to The Schooner Exchange v McFaddon. But it largely emptied it of substance by applying it according to the states purpose in doing the act. As Van Devanter J put it, at p 574, when, for the purpose of advancing the trade of its people or providing revenue for its treasury, a government acquires, mans, and operates ships in the carrying trade, they are public ships in the same sense that war ships are. We know of no international usage which regards the maintenance and advancement of the economic welfare of a people in time of peace of any less a public purpose than the maintenance and training of a naval force. This settled the position for some twenty years as far as claims for state immunity in the United States courts were concerned. But, as the State Department recorded in the Tate Letter of 1952 ((1952) 26 Department of State Bulletin, 984 985), it maintained its long standing practice of not asserting immunity in foreign courts in proceedings alleging ordinary contractual or tortious liability against the United States. The position in civil law countries was highly diverse. In France, the absolute doctrine was endorsed by the Cour de Cassation in its celebrated decision in Lambge et Pujol v Etat dEspagne, 22 Jan 1849, Dalloz (1849), i, 5. But the principle was not consistently applied in its absolute form, and a series of decisions in the first half of the 20th century appeared to recognise a distinction between the public and private law functions of states: see Dunbar, art cit, 212 218. The absolute doctrine was consistently applied until recent times in Spain, Portugal and Japan, but less consistently in Germany and the Netherlands and not at all in Switzerland. It has never been recognised in Italy or Belgium, whose highest courts were among the first to adopt the restrictive doctrine in a recognisably modern form. As early as 1886, the Italian Corte di Cassazione justified its position by observing: No one can deny that the foundation of international law is the sovereignty and independence of states; and that in consequence of this principle each state, in the exercise of its powers, is exempted from the jurisdiction of other states. But the fallacy consists in considering the state exclusively and always as a body politic, although its activity as a civil entity cannot be gainsaid when it performs acts acquiring rights and assuming obligations in private relationships, like any other physical or juristic person being capable of exercising civil rights. Typaldos, Console di Grecia v Manicmio di Aversa, Giurisprundenzia Italiana (1886), I, 228, 229. The Belgian Cour de Cassation, after some three decades in which the restrictive doctrine had been applied by the lower courts, adopted it in SA des Chemins de Fer Ligeois Luxembourgeois v Etat Nerlandais, Pasicrisie Belge (1903), ii, 294, 301 302 for very similar reasons. Looking at the position in the years immediately following the second world war, Sir Hersch Lauterpacht concluded that the common assumption that the majority of states were wedded to the doctrine of absolute state immunity was inaccurate. On the contrary, in the great majority of states in which there is an articulate practice on the subject, courts have declined to follow the principle of absolute immunity (pp 250 251). It followed, that so far as the actual practice of states may be said to be evidence of customary international law, there is no doubt that the principle of absolute immunity forms no part of international custom (p 221). Thirty five years later the International Law Commission, reporting to the United Nations General Assembly on the difficulties which it had encountered in formulating a basic principle of state immunity, expressed the same view: There is common agreement that, for acts performed in the exercise of the prerogatives de la puissance publique or sovereign authority of the State, there is undisputed immunity. Beyond or around that hard core of immunity, however, there appears to be a grey zone in which opinions and existing case law, and indeed legislations, still vary. Report of the International Law Commission on the Work of its thirty eighth session [A/41/10] ILC Yearbook (1986), ii(2), 16. The story of the progressive adoption of the restrictive doctrine of state immunity in the past 70 years is well known and can be shortly summarised. The main impetus for this was the growing significance of state trading organisations in international trade. The critical moment was the formal adoption (or readoption) of the restrictive doctrine by the United States government in the Tate Letter, addressed by the legal adviser to the State Department to the Acting Attorney General on 19 May 1952. After reciting the adoption of the restrictive doctrine by a growing number of states, it stated the intention of the executive to act on it. The widespread and increasing practice on the part of governments of engaging in commercial activities, it observed, makes necessary a practice which will enable persons doing business with them to have their rights determined in the courts: loc cit, 985. Following the Tate Letter, the restrictive doctrine was generally adopted by Federal Courts, a development which was ultimately approved by the Supreme Court in Alfred Dunhill of London Inc v Republic of Cuba, 425 US 682, 701 703 (1976). In Europe, the main landmark was the adoption by the German Bundesverfassungsgericht of the restrictive theory in 1963, and its acceptance that the distinction between acts jure imperii and jure gestionis depended on the juridical character of the act, not the purpose of the state in doing it: Claim against the Empire of Iran (1963) 45 ILR 257. The courts of the United Kingdom, followed suit in the 1970s. Today, the international consensus in favour of the restrictive doctrine is almost complete. While there are a few states whose domestic position is unclear, with the legislative adoption of the restrictive doctrine by Russia in 2015, the only notable state still to adhere to the absolute doctrine is China. Three points can be derived from this history. The first is that there has probably never been a sufficient international consensus in favour of the absolute doctrine of immunity to warrant treating it as a rule of customary international law. All that can be said is that during certain periods, a substantial number of states, but not necessarily a majority, have adopted the absolute doctrine as part of their domestic law. Some of them have done so on the assumption that it represented international law, but without any real investigation of the rule recognised in other states. Secondly, while there has for at least two centuries been a consensus among nations in favour of some form of state immunity, the only consensus that there has ever been about the scope of that immunity is the consensus in favour of the restrictive doctrine. Thirdly, the adoption of the restrictive doctrine has not proceeded by accumulating exceptions to the absolute doctrine. What has happened is that governments, courts and writers of authority have been prompted by the widening scope of state operations and their extension into commerce and industry, to re examine the true basis of a doctrine originally formulated at a time when states by and large confined their operations in other countries to the classic exercises of sovereign authority. The true basis of the doctrine was and is the equality of sovereigns, and that never did warrant immunity extending beyond what sovereigns did in their capacity as such. As Lord Wilberforce put it in The I Congreso del Partido [1983] 1 AC 244, 262, It is necessary to start from first principle. The basis upon which one state is considered to be immune from the territorial jurisdiction of the courts of another state is that of par in parem, which effectively means that the sovereign or governmental acts of one state are not matters upon which the courts of other states will adjudicate. Application to contracts of employment As a matter of customary international law, if an employment claim arises out of an inherently sovereign or governmental act of the foreign state, the latter is immune. It is not always easy to determine which aspects of the facts giving rise to the claim are decisive of its correct categorisation, and the courts have understandably avoided over precise prescription. The most satisfactory general statement is that of Lord Wilberforce in The I Congreso del Partido, at 267: The conclusion which emerges is that in considering, under the restrictive theory whether state immunity should be granted or not, the court must consider the whole context in which the claim against the state is made, with a view to deciding whether the relevant act(s) upon which the claim is based, should, in that context, be considered as fairly within an area of activity, trading or commercial, or otherwise of a private law character, in which the state has chosen to engage, or whether the relevant act(s) should be considered as having been done outside that area, and within the sphere of governmental or sovereign activity. In the great majority of cases arising from contract, including employment cases, the categorisation will depend on the nature of the relationship between the parties to which the contract gives rise. This will in turn depend on the functions which the employee is employed to perform. The Vienna Convention on Diplomatic Relations divides the staff of a diplomatic mission into three broad categories: (i) diplomatic agents, ie the head of mission and the diplomatic staff; (ii) administrative and technical staff; and (iii) staff in the domestic service of the mission. Diplomatic agents participate in the functions of a diplomatic mission defined in article 3, principally representing the sending state, protecting the interests of the sending state and its nationals, negotiating with the government of the receiving state, ascertaining and reporting on developments in the receiving state and promoting friendly relations with the receiving state. These functions are inherently governmental. They are exercises of sovereign authority. Every aspect of the employment of a diplomatic agent is therefore likely to be an exercise of sovereign authority. The role of technical and administrative staff is by comparison essentially ancillary and supportive. It may well be that the employment of some of them might also be exercises of sovereign authority if their functions are sufficiently close to the governmental functions of the mission. Cypher clerks might arguably be an example. Certain confidential secretarial staff might be another: see Governor of Pitcairn v Sutton (1994) 104 ILR 508 (New Zealand Court of Appeal). However, I find it difficult to conceive of cases where the employment of purely domestic staff of a diplomatic mission could be anything other than an act jure gestionis. The employment of such staff is not inherently governmental. It is an act of a private law character such as anyone with the necessary resources might do. This approach is supported by the case law of the European Court of Human Rights, which I have already summarised. In Cudak, Sabeh El Leil, Wallishauser and Radunovi, all cases concerning the administrative and technical staff of diplomatic missions, the test applied by the Strasbourg Court was whether the functions for which the applicant was employed called for a personal involvement in the diplomatic or political operations of the mission, or only in such activities as might be carried on by private persons. In Mahamdia v Peoples Democratic Republic of Algeria (Case C 154/11) [2013] ICR 1, para 55 57, the Court of Justice of the European Union applied the same test, holding that the state is not immune where the functions carried out by the employee do not fall within the exercise of public powers. The United States decisions are particularly instructive, because the Foreign State Immunity Act of the United States has no special provisions for contracts of employment. They therefore fall to be dealt with under the general provisions relating to commercial transactions, which have been interpreted as confining state immunity to exercises of sovereign authority: see Saudi Arabia v Nelson 507 US 349, 360 (1993). The principle now applied in all circuits that have addressed the question is that a state is immune as regards proceedings relating to a contract of employment only if the act of employing the plaintiff is to be regarded as an exercise of sovereign authority having regard to his or her participation in the diplomatic functions of the mission: Segni v Commercial Office of Spain 835 F 2d 160, 165 (7th Cir, 1987), Holden v Canadian Consulate 92 F 3d 918 (9th Cir, 1996). Although a foreign state may in practice be more likely to employ its nationals in those functions, nationality is in itself irrelevant to the characterisation: El Hadad v United Arab Emirates 216 F 3d 29 (DC Cir, 2000), at 4, 5. In Park v Shin 313 F 3d 1138 (9th Cir, 2002), paras 12 14, it was held that the act of hiring a domestic servant is not an inherently public act that only a government could perform, even if her functions include serving at diplomatic entertainments. A very similar principle has been consistently applied in recent decisions of the French Cour de Cassation: Barrandon v United States of America, 116 ILR 622 (1998), Coco v Argentina 113 ILR 491 (1996), Saignie v Embassy of Japan 113 ILR 492 (1997). In the last named case, at p 493, the court observed that the employee, a caretaker at the premises of the mission, had not had any special responsibility for the performance of the public service of the embassy. I would, however, wish to guard against the suggestion that the character of the employment is always and necessarily decisive. Two points should be made, albeit briefly since neither is critical to this appeal. The first is that a states immunity under the restrictive doctrine may extend to some aspects of its treatment of its employees or potential employees which engage the states sovereign interests, even if the contract of employment itself was not entered into in the exercise of sovereign authority. Examples include claims arising out of an employees dismissal for reasons of state security. They may also include claims arising out of a states recruitment policy for civil servants or diplomatic or military employees, or claims for specific reinstatement after a dismissal, which in the nature of things impinge on the states recruitment policy. These particular examples are all reflected in the United Nations Convention and were extensively discussed in the preparatory sessions of the International Law Commission. They are certainly not exhaustive. In re Canada Labour Code [1992] 2 SCR 50, concerned the employment of civilian tradesmen at a US military base in Canada. The Supreme Court of Canada held that while a contract of employment for work not involving participation in the sovereign functions of the state was in principle a contract of a private law nature, particular aspects of the employment relationship might be immune as arising from inherently governmental considerations, for example the introduction of a no strike clause deemed to be essential to the military efficiency of the base. In these cases, it can be difficult to distinguish between the purpose and the legal character of the relevant acts of the foreign state. But as La Forest J pointed out (p 70), in this context the states purpose in doing the act may be relevant, not in itself, but as an indication of the acts juridical character. The second point to be made is that the territorial connections between the claimant on the one hand and the foreign or forum state on the other can never be entirely irrelevant, even though they have no bearing on the classic distinction between acts done jure imperii and jure gestionis. This is because the core principle of international law is that sovereignty is territorial and state immunity is an exception to that principle. As the International Court of Justice observed in Jurisdictional Immunities of the State, at para 57, the principle of state immunity has to be viewed together with the principle that each State possesses sovereignty over its own territory and that there flows from that sovereignty the jurisdiction of the State over events and persons within that territory. Exceptions to the immunity of the State represent a departure from the principle of sovereign equality. Immunity may represent a departure from the principle of territorial sovereignty and the jurisdiction which flows from it. The whole subject of the territorial connections of a non state contracting party with the foreign or the forum state raises questions of exceptional sensitivity in the context of employment disputes. There is a substantial body of international opinion to the effect that the immunity should extend to a states contracts with its own nationals irrespective of their status or functions even if the work falls to be performed in the forum state; and correspondingly that it should not extend to staff recruited from the local labour force in whose protection the forum state has a governmental interest of its own. Both propositions received substantial support in the preparatory sessions leading to the United Nations Convention and were reflected in the final text of article 11. Both receive a measure of recognition in the Vienna Convention on Diplomatic Relations which carefully distinguishes between the measure of immunity accorded to the staff of a diplomatic mission according to whether they are nationals of the foreign state or nationals or permanent residents of the forum state: see articles, 33.2, 37, 38, 39.4 and 44. In a practical sense, it might be thought reasonable that a contract between a state and one of its own nationals should have to be litigated in the courts of that state under its laws, but unreasonable that the same should apply to locally recruited staff. There is, however, only limited international consensus on where the boundaries lie between the respective territorial responsibilities of the foreign and the forum state, and on how far the territorial principle can displace the rule which confers immunity on acts jure imperii but not on acts jure gestionis. I shall expand on this point below, in the context of section 4 of the State Immunity Act, which is largely based on the territorial principle. Section 4(2) At the time when the State Immunity Act was enacted, the application of state immunity to contracts of employment had only lately emerged as a potential problem. States had traditionally recruited the staff of diplomatic and representative missions at home. The employment of locally recruited staff in significant numbers was a recent development. The European Convention on State Immunity was one of the first international instruments to make special provision for contracts of employment, which would otherwise have fallen to be dealt with under the general principles of customary international law relating to state immunity. There was, however, no consistency of state practice capable of founding a special rule of customary international law governing employment. This was recognised during the preparatory sessions of the International Law Commission relating to jurisdictional immunities of states. The working group reviewing the Commissions draft articles of 1991 observed in 1999: 96. Although it has been argued that there are no universally accepted international law principles regulating the position of employees of foreign States, relevant case law has often considered a contract of employment as merely a special type of commercial/private law contract. 97. In this regard, it is important to distinguish between those States whose law on sovereign immunities makes a specific provision for contracts of employment and those States where it does not or which have no statute on the subject. In the latter cases, it is necessary to analyse the contract of employment as a commercial or private law contract, whereas in the former case, the only question is whether the contract of employment falls within the relevant provisions. 98. A key concern has been to balance the sovereignty of States with the interests of justice involved when an individual enters into a transaction with a State. One way of achieving this balance has been to stress a distinction between acts that are sovereign, public or governmental in character as against acts that are commercial or private in character 99. Immunity has generally been granted in respect of the employment of persons at diplomatic or consular posts whose work involves the exercise of governmental authority. 100. The cases examined indicate a tendency for courts to find that they have the jurisdiction to hear disputes relating to employment contracts, where the employment mirrors employment in the private sector. However, there has also been recognition that some employment based on such contracts involves governmental activities by the employees and, in such circumstances, courts have been prepared to grant immunity. ILC Yearbook (1999), ii(2), 166. The travaux leading to article 11 of the United Nations Convention contain no suggestion that existing state practice supported a special rule of international law concerning employment claims, extending beyond the immunity attaching to sovereign acts. On the contrary, it is clear from both the travaux themselves and the impressive body of legal materials assembled by the parties to this appeal that, while many states assert a special jurisdiction over employment disputes extending to the employees of foreign states, there is considerable diversity in this area. The ILCs Special Rapporteur reported in 1983 (ILC Yearbook (1983), ii(1), 34 8 [A/CN.4/363]) that: the current practice of States with regard to contracts of employment can offer no greater comfort nor absolute proof approaching a universal or uniform State practice. It only indicates a deeper intrusion into a darker or greyer zone of greater controversy. (para 39) The most that could be said was that All things considered, an emerging trend appears to favour the application of local labour law in regard to recruitment of the available labour force within a country, and consequently to encourage the exercise of territorial jurisdiction at the expense of jurisdictional immunities of foreign States. (para 60) The result is that the State Immunity Act 1978 can be regarded as giving effect to customary international law only so far as it distinguishes between exercises of sovereign authority and acts of a private law character, and requires immunity to be conferred on the former but not the latter. There is no basis in customary international law for the application of state immunity in an employment context to acts of a private law character. Under the terms of the Act, contracts of employment are excluded from the ambit of section 3, which applies the distinction between sovereign acts and acts of a private law character to other contracts for the supply of services. Section 4 by comparison identifies those contracts of employment which attract immunity by reference to the respective connections between the contract or the employee and the two states concerned. In principle, immunity does not attach to employment in the local labour market, ie where the contract was made in the United Kingdom or the work fell to be performed there: see section 4(1). However, this is subject to sections 4(2)(a) and (b), which are concerned with the employees connections by nationality or residence with the foreign state (section 4(2)(a)) or the forum state (section 4(2)(b)). Section 4(2)(a) extends the immunity to claims against the employing state by its own nationals. As I have said, this may have a sound basis in customary international law, but does not arise here. Section 4(2)(b) extends it to claims brought by nationals or habitual residents of third countries. Both subsections apply irrespective of the sovereign character of the relevant act of the foreign state. Sections 4(2)(a) and (b) are derived from article 5.2(a) and (b) of the European Convention on State Immunity. Like section 4 of the Act, article 5 of the Convention deals with contracts of employment without reference to the distinction between acts jure imperii and jure gestionis which are the basis of the restrictive doctrine of immunity. Contractual submission apart, the availability of state immunity in answer to employment claims is made to depend entirely on the location of the work and the respective territorial connections between the employee on the one hand and the foreign state or the forum state on the other. The explanatory report submitted to the Committee of Ministers of the Council of Europe justified this on the ground that the links between the employee and the employing State (in whose courts the employee may always bring proceedings), are generally closer than those between the employee and the State of the forum. The United Kingdom is not unique in applying this principle. Seven other European countries are party to the European Convention on State Immunity and six other countries have enacted legislation containing provisions similar to section 4(2) of the United Kingdom Act. But this is hardly a sufficient basis on which to identify a widespread, representative and consistent practice of states, let alone to establish that such a practice is accepted on the footing that it is an international obligation. The considerable body of comparative law material before us suggests that unless constrained by a statutory rule the general practice of states is to apply the classic distinction between acts jure imperii and jure gestionis, irrespective of the nationality or residence of the claimant. Indeed, the courts of a significant number of jurisdictions have refused to apply the immunity as between states which are not I conclude that section 4(2)(b) of the State Immunity Act 1978 is not justified both party to the Convention, unless they performed functions directly related to the exercise of the states sovereign authority, on the ground that the requirements of general international law differed on this point from those of the Convention: see French Consular Employee Claim (1989) 86 ILR 583 (Supreme Court, Austria); British Consulate General in Naples v Toglia (1989) 101 ILR 379, 383 384 (Corte de Cassazione, Italy); De Queiroz v State of Portugal, 115 ILR 430 (1992) (Brussels Labour Court, Belgium, 4th Chamber); M v Arab Republic of Egypt (1994) 116 ILR 656 (Federal Tribunal, Switzerland); Muller v United States of America 114 ILR 512, 517 (1998) (Regional Labour Court, Hesse); X v Saudi School in Paris and Kingdom of Saudi Arabia, 127 ILR 163 (2003) (Cour de Cassation, France note the observations of the Advocate General at p 165); A v B Oxf Rep Int L (ILDC 23) (2004) (Supreme Court, Norway); Kingdom of Morocco v HA Yearbook of International Law (2008), 392 (Court of Appeal of the Hague, Netherlands). by any binding principle of international law. The Secretary of State has an alternative argument to the effect that section 4(2)(b) may be justifiable as an application of purely domestic policy, on the ground that the United Kingdoms interest in asserting the jurisdiction of its own courts over the employment of the local labour force does not extend to nationals or residents of third countries. I reject this argument. On the footing that international law does not require a state to be given immunity, I do not see how the absence of British nationality or residence at the time of the contract can be a proper ground for denying an employee access to the courts in respect of their employment in the United Kingdom. They have no territorial connection with their employer, other than that which is implicit in the employment relationship itself. The fact that they may have had no connection with the United Kingdom either before they came to work here does not prevent them from being part of the domestic labour force afterwards. Nor do I accept that the only relevant interest for this purpose is that of the United Kingdom state. The forum state has duties as well as rights, and as a matter of domestic policy they extend to the protection of those lawfully living and employed in the United Kingdom. Section 16(1)(a) Since section 16(1)(a) extends state immunity to the claims of any employee of a diplomatic mission, irrespective of the sovereign character of the employment or the acts of the state complained of, it is plain that it cannot be justified by reference to any general principle of immunity based on the restrictive doctrine. It could be justified only if there were a special rule, in effect an absolute immunity, applicable to embassy staff. I have already pointed out, in the context of section 4(2)(b), that in jurisdictions where the courts determine claims to immunity by reference to customary international law, the test is whether the relevant acts of the state were exercises of sovereign authority. The analysis need not be repeated here. It is inconsistent with any suggestion that immunity can attach to all embassy staff as such. The Secretary of State submits that there is indeed a special rule applicable to embassy staff. He says that such a rule is implicit in the international obligations of the United Kingdom under the Vienna Convention on Diplomatic Relations, the European Convention on State Immunity, and the state of customary international law reflected in the United Nations Convention. The Vienna Convention on Diplomatic Relations has been ratified by almost every state in the world and may for practical purposes be taken to represent a universally binding standard in international law. Article 7 provides that a sending state may freely appoint members of the staff of a diplomatic mission. The staff referred to include the technical, administrative and domestic staff as well as the diplomatic staff: see article 1. The argument is that the freedom to appoint embassy staff must imply a freedom to dismiss them. Article 32 of the European Convention on State Immunity and article 3.1 of the United Nations Convention both provide that they are not to prejudice the privileges and immunities of a state in relation to the exercise of the functions of its diplomatic missions and persons connected with them. In my opinion, however, article 7 of the Vienna Convention has only a limited bearing on the application of state immunity to employment claims by embassy staff. I would accept that the right freely to appoint embassy staff means that a court of the forum state may not make an order which determines who is to be employed by the diplomatic mission of a foreign state. Therefore, it may not specifically enforce a contract of employment with a foreign embassy or make a reinstatement order in favour of an employee who has been dismissed. But a claim for damages for wrongful dismissal does not require the foreign state to employ any one. It merely adjusts the financial consequences of dismissal. No right of the foreign state under the Vienna Convention is infringed by the assertion of jurisdiction in the forum state to carry out that adjustment. Therefore, no right under the Vienna Convention would be prejudiced by the refusal of the forum state to recognise the immunity of the foreign state as regards a claim for damages. The closest that any international instrument has come to providing for a general immunity of states as regards claims by embassy staff is article 11.2(b) of the United Nations Convention. The article provides, so far as relevant: 1. Unless otherwise agreed between the States concerned, a State cannot invoke immunity from jurisdiction before a court of another State which is otherwise competent in a proceeding Article 11 which relates to a contract of employment between the State and an individual for work performed or to be performed, in whole or in part, in the territory of that other State. 2. Paragraph 1 does not apply if: (a) the employee has been recruited to perform particular functions in the exercise of governmental authority; (b) the employee is: (i) a diplomatic agent, as defined in the Vienna Convention on Diplomatic Relations of 1961; (ii) a consular officer, as defined in the Vienna Convention on Consular Relations of 1963; (iii) a member of the diplomatic staff of a permanent mission international organization or of a special mission, or is recruited to represent a State at an international conference; or (iv) any other person enjoying diplomatic immunity. (c) the subject matter of the proceeding is the recruitment, renewal of employment or reinstatement of an individual; (d) the subject matter of the proceeding is the dismissal or termination of employment of an individual and, as determined by the head of State, the head of Government or the Minister for Foreign Affairs of the employer State, such a proceeding would interfere with the security interests of that State; to an (e) the employee is a national of the employer State at the time when the proceeding is instituted, unless this person has the permanent residence in the State of the forum; (f) the employer State and the employee have otherwise agreed to any in writing, subject considerations of public policy conferring on the courts of the State of the forum exclusive jurisdiction by reason of the subject matter of the proceeding. In general, article 11 adheres to the restrictive doctrine, confining the immunity in employment disputes to cases where the making of the contract or the acts giving rise to the complaint were exercises of sovereign authority, or the dispute is between a state and one of its own nationals. Article 11.2(b) of the United Nations Convention lists four categories of employee whose claims will attract immunity. The first three categories are diplomatic or consular staff whose functions would normally be regarded as inherently governmental. But the fourth category comprises any other person enjoying diplomatic immunity. Under the Vienna Convention on Diplomatic Relations, all members of the staff of a mission who are not nationals of or permanently resident in the receiving state enjoy diplomatic immunity, including (in respect of acts performed in the course of their duties) domestic staff: see article 37(3). On the face of it, therefore, this provision applies state immunity to all claims by embassy staff at whatever level and irrespective of the juridical character of the acts giving rise to the dispute. The Court of Appeal, adopting a suggestion in OKeefe and Tams (ed), The United Nations Convention of Jurisdictional Immunities of States and their Property. A Commentary (2013), 201 2, have held that it could not have meant this in the light of the travaux preparatoires. These do not explain how article 11.2(b) came to assume its final form. But they do show that the working groups and committees of the International Law Commission intended to limit the immunity to the employment of diplomatic agents. It was suggested to us that sub paragraph (iv) might also have been intended to cover diplomats at international conferences, and there are passages in the travaux which support that view: see, in particular, Report of the ILC Working Group on Jurisdictional Immunities of States, ILC Yearbook (1999), ii(2), para 105. But since both of these categories are already covered by article 11(2)(b)(i) and (iii), and the language of (iv) is unequivocal, I doubt whether these suggestions can be supported. It is, however, unnecessary to decide the point, because it is in my view clear that if article 11(2)(b)(iv) means what it says, it is legislative rather than declaratory of existing international law. It may one day bind states qua treaty. It may come to represent customary international law if and when the Convention attracts sufficient support. But it does not do either of these things as matters presently stand. There are judicial decisions in which the court, while limiting the immunity to exercises of sovereign authority, has taken an expansive view of the range of acts relating to an embassy employee which can be so described. Sengupta v Republic of India [1983] ICR 221 was a decision of the Employment Appeal Tribunal under the common law in force before the passing of the State Immunity Act 1978. The Tribunal held that state immunity attached to a claim for the unfair dismissal of an employee of the Indian High Commission in London. He was employed at what Browne Wilkinson J, delivering the judgment of the court, described (p 223) as the lowest clerical level. He was essentially responsible for collating press cuttings. The tribunals reasons appear from pp 228 229 of the judgment: When one looks to see what is involved in the performance of the applicants contract, it is clear that the performance of the contract is part of the discharge by the foreign state of its sovereign functions in which the applicant himself, at however lowly a level, is under the terms of his contract of employment necessarily engaged. One of the classic forms of sovereign acts by a foreign state is the representation of that state in a receiving state A contract to work at a diplomatic mission in the work of that mission is a contract to participate in the public acts of the foreign sovereign. The dismissal of the applicant was an act done in pursuance of that public function, ie the running of the mission. As a consequence, the fairness of any dismissal from such employment is very likely to involve an investigation by the industrial tribunal into the internal management of the diplomatic representation in the United Kingdom of the Republic of India, an investigation wholly inconsistent with the dignity of the foreign state and an interference with its sovereign functions. A very similar view was taken in Government of Canada v Employment Appeals Tribunal and Burke (1992) 95 ILR 467, 500 where the Irish Supreme Court, applying the common law in the absence of any domestic legislation in Ireland, held that the services of a chauffeur employed by the Canadian embassy in Dublin were sufficiently related to the diplomatic functions of the embassy to make Canada immune from suit. OFlaherty J, delivering the judgment of the majority, said (p 500) that prima facie anything to do with the embassy is within the public domain of the government in question. There have been occasional decisions to the same effect in other jurisdictions: see, for example, Heusala v Turkey (1993) Oxf Rep Int L (ILDC 576) (Supreme Court, Finland); A v B (2004) Oxf Rep Int L (ILDC 23) (Supreme Court, Norway). These decisions amount to saying that the employment of embassy staff is inherently governmental notwithstanding the non governmental character of the particular employees functions or of the relevant acts of the employer. Sengupta was decided at an early stage of the development of the law in this area and, in my opinion, the test applied by the Employment Appeal Tribunal was far too wide. I agree with the criticism of the decision in Fox, The Law of State Immunity, 3rd ed (2013), 199n, that the reasoning had more regard to the purpose than to the juridical character of the claimants employment. It is not for this court to review the domestic case law of the other jurisdictions cited, least of all when they are based on the categorisation of the particular facts. For my part, however, I doubt whether an English court applying customary international law could properly have categorised the facts of these cases as involving exercises of sovereign authority. The way in which the restrictive doctrine has been applied by the European Court of Human Rights, the federal courts of the United States and the French Cour de Cassation appears to me to be more consistent with the underlying principle. What is, however, clear beyond argument is that there is no international consensus on this point sufficient to found a rule of customary international law corresponding to section 16(1)(a) of the State Immunity Act 1978. I have already pointed out that in treating article 11 as expressing customary international law, the European Court of Human Rights had in mind those parts of article 11 which reflected the restrictive doctrine. In all of the cases in which it has held the recognition of immunity to violate article 6 of the Human Rights Convention, the applicant appears to have been a national or permanently resident in the forum state. The applicant did not therefore enjoy diplomatic immunity and neither article 11(2)(b)(iv) nor article 11(2)(e) arose for consideration. Application to the present cases Since I have concluded that no principle of international law deprived the Employment Tribunal of jurisdiction in these cases, it follows that the United Kingdom had jurisdiction over Libya and Sudan as a matter of international law, and article 6 is engaged by its refusal to exercise it. The jurisdictional issue raised by Lord Millett in Holland v Lampen Wolfe and by Lord Bingham and Lord Hoffmann in Jones v Saudi Arabia does not arise. The employment of Ms Janah and Ms Benkharbouche were clearly not exercises of sovereign authority, and nothing about their alleged treatment engaged the sovereign interests of their employers. Nor are they seeking reinstatement in a way that would restrict the right of their employers to decide who is to be employed in their diplomatic missions. As a matter of customary international law, therefore, their employers are not entitled to immunity as regards these claims. It follows that so far as sections 4(2)(b) or 16(1)(a) of the State Immunity Act confer immunity, they are incompatible with article 6 of the Human Rights Convention. Discrimination Ms Janahs case that the discriminatory character of section 4(2)(b) of the Act is a violation of article 14 of the Human Rights Convention, read in conjunction with article 6, adds nothing to her case based on article 6 alone. Section 4(2)(b) unquestionably discriminates on grounds of nationality. The only question is whether the discrimination is justifiable by reference to international law. If state immunity is no answer to the claim under article 6 alone, then it is no answer to the claim under the combination of article 6 and article 14. In my view, the denial of access to the courts to persons in her position is unjustifiable whether it is discriminatory or not. Article 47 of the EU Charter of Fundamental Rights Article 47 provides, so far as relevant, that: everyone whose rights and freedoms guaranteed by the law of the Union are violated has the right to an effective remedy before a tribunal in compliance with the conditions laid down in this article. The scope of article 47 of the Charter is not identical to that of article 6 of the Human Rights Convention, but the Secretary of State accepts that on the facts of this case if the Convention is violated, so is the Charter. A claim to state immunity which is justified in international law, would be an answer in both cases: Mahamdia v Peoples Democratic Republic of Algeria (Case C 154/11) [2013] ICR 1, Advocate General at paras 17 23, endorsed by the Court at para 55. It follows that there is no separate issue as to article 47 of the Charter. The only difference that it makes is that a conflict between EU law and English domestic law must be resolved in favour of the former, and the latter must be disapplied; whereas the remedy in the case of inconsistency with article 6 of the Human Rights Convention is a declaration of incompatibility. Conclusion I would dismiss the Secretary of States appeal and affirm the order of the Court of Appeal. The result is that sections 4(2)(b) and 16(1)(a) of the State Immunity Act 1978 will not apply to the claims derived from EU law for discrimination, harassment and breach of the Working Time Regulations. Subject to any question as to the application of section 4(2)(b) to the particular circumstances of Ms Benkharbouche, the other claims (failure to provide payslips or a contract of employment, unpaid wages, failure to pay the national minimum wage and unfair dismissal) are barred by those sections of the Act. But to that extent they are incompatible with article 6 of the Human Rights Convention, and also, in the case of section 4(2)(b) with article 6 read with article 14 of the Convention. Both cases must be remitted to the Employment Tribunal to determine the claims based on EU law on their merits.

Ms Janah is a Moroccan national who was recruited in Libya to work as a domestic worker for the Libyan government at its London embassy. Ms Benkharbouche is a Moroccan national who was recruited in Iraq to work for Sudan at its London embassy. Both were dismissed from their employment and then issued claims in the Employment Tribunal against Libya and Sudan respectively. Some of their claims were based on EU law. Others were based on breach of contract or on purely domestic statutes of the United Kingdom. In both actions the Employment Tribunal dismissed the claims on the basis that Libya and Sudan were entitled to state immunity under the State Immunity Act 1978 (1978 Act). The Employment Appeal Tribunal (EAT) heard Ms Janahs and Ms Benkharbouches appeals together. The EAT allowed the appeals and held that those sections were incompatible with article 47 of the EU Charter of Fundamental Rights and Freedoms (EU Charter) which reflects the right in EU law to a remedy before a tribunal. The EAT consequently disapplied sections 4(2)(b) and 16(1)(a) of the 1978 Act insofar as those sections barred the claims which were based on EU law. The Court of Appeal affirmed the judgment of the EAT and declared those sections of the 1978 Act to be incompatible with the right to access a court, under article 6 of the European Convention on Human Rights (ECHR). The Secretary of State appeals in both cases. The Supreme Court unanimously dismisses the appeal. Lord Sumption gives the judgment, with which Lord Neuberger, Lady Hale, Lord Clarke and Lord Wilson agree. The 1978 Act renders a foreign state immune from the jurisdiction of a UK court in a claim based on the foreign states employment of the claimant, where the claimant either: (i) at the time of the contract, was neither a UK national nor UK resident; or (ii) works for the foreign states diplomatic mission. Section 4(2)(b) confers immunity in the first category; section 16(1)(a) confers immunity in the second [1, 11]. Article 6 of the ECHR confers a right of access to a court to determine disputes, although that right is not absolute [14]. The Claimants argued that the relevant provisions of the 1978 Act were incompatible with EU law and with Article 6 of the ECHR, because they prevented access to a court in circumstances where this result was not required by international law. The Secretary of State argued (i) that a courts recognition of state immunity can never amount to an infringement of article 6, because it only reflects the courts lack of jurisdiction over a foreign state, but (ii) that in any event the relevant provisions of the Act were consistent with international law or at least with a tenable view of international law. [29 30, 34 35]. The test was whether the relevant provisions of the Act were consistent with international law, not whether there was a tenable view to that effect. These provisions were not consistent with international law. A court may identify a rule of customary international law only if enough states follow a consistent practice, on the footing that it is a legal obligation [31]. The Secretary of State argued that although states now recognise a more restrictive doctrine of state immunity, the immunity is still absolute unless there is sufficient international consensus to show that Libya and Sudan fall into any established exception to that absolute immunity [33]. This Court rejects those arguments, which mischaracterise the historical development of the restrictive doctrine of immunity. Specifically: (i) while there is a long standing consensus of states in favour of immunity there has probably never been sufficient international consensus for an absolute rule of state immunity in customary international law; (ii) the only consensus that there has ever been about the scope of state immunity is the relatively recent consensus in favour of the restrictive doctrine; (iii) that restrictive doctrine emerged after a re examination of the true basis of the doctrine, rather than by creating exceptions to any general rule of absolute immunity [40 52]. In customary international law, a foreign state is immune where a claim is based on sovereign acts. Whether a foreign states employment of a claimant constitutes a sovereign act depends on the nature of that employer employee relationship. That will, in turn, depend primarily on the functions which the employee is employed to perform. The employment of purely domestic staff in a diplomatic mission is a private act, rather than an inherently sovereign act. That approach is supported by the reasoning in case law from the United States, France, and the European Court of Human Rights [53 56]. Under section 4(2)(b) of the Act, whether a foreign state is immune depends entirely on the nationality and residence of the claimant at the date of the employment contract. That section draws no distinction between acts of a private nature and acts of a sovereign nature. That approach to state immunity is followed by some states but lacks any basis in customary international law [64 66]. A persons nationality and residence at the date of the employment contract are not proper grounds for denying a person access to the courts in respect of their employment in this country [67]. Section 16(1)(a) extends state immunity to the employment of all members of a diplomatic mission. The Court rejects the Secretary of States argument that a state is entitled in international law to absolute immunity in respect of the employment of embassy staff. Although article 7 of the Vienna Convention on Diplomatic Relations 1961 indicates that a court may not order a foreign state to employ a specific person in its embassy, this issue does not arise where the claimant only seeks damages (rather than reinstatement in his or her previous position) [68 69]. Nor is there any corresponding rule of customary international law to extend absolute state immunity to the employment of embassy staff [70 72]. As a matter of customary international law, therefore, neither Sudan nor Libya are entitled to immunity in respect of these claims. Sections 4(2)(b) and 16(1)(a) of the 1978 Act, which confer immunity in English law, are consequently incompatible with article 6 of the ECHR [74 75]. In light of that, the Secretary of State accepted that those sections were also incompatible with article 47 of the EU Charter [77]. The Court also accepts Ms Janahs argument that section 16(1)(a) of the 1978 Act discriminated unjustifiably on the grounds of nationality, but in the circumstances that adds nothing [76]. EU law prevails over English law in the event of a conflict, so those sections of the 1978 Act cannot bar the claims which are based on EU law [77]. Those EU law claims are remitted to the Employment Tribunal, to be determined at trial. The other claims remain barred by the 1978 Act, notwithstanding that the Court of Appeal properly made a declaration of incompatibility with the ECHR in respect of them [78].

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The appellant Dermot Patrick OBrien (Mr OBrien) is a retired barrister. He also held part time judicial office as a recorder appointed under section 21 of the Courts Act 1971, as amended. He claims to be entitled to a pension in respect of his part time non salaried judicial work. The case raises questions of domestic law about the status and terms of service of part time non salaried judges in England and Wales. They include chairmen and members of tribunals and others exercising judicial functions for remuneration. It also raises important questions of EU law as to which, having sought a preliminary ruling under article 267 of the Treaty for the Functioning of the European Union (the TFEU), the court has now received guidance from the Court of Justice of the European Union (the CJEU). The effect of section 3(1) of the European Communities Act 1972 is that the questions of EU law must be determined in accordance with the principles laid down in its preliminary ruling by that court. The EU law questions relate to Council Directive 97/81/EC of 15 December 1997 [1997] OLJ 14/9 (the PTWD) concerning the Framework Agreement on part time work which was concluded on 6 June 1997 between the general cross industry organisations (UNICE, CEEP and ETUC) and is annexed to the Directive (the Framework Agreement). Directives are binding as to the result to be achieved, leaving only the choice of form and methods to the Member State: article 288 TFEU. The PTWD was extended to the United Kingdom by Directive 98/23 [1998] OJL 131/10. It was transposed into domestic law by the Part time Workers (Prevention of Less Favourable Treatment) Regulations 2000, SI 2000/1551 (the 2000 Regulations), which were made under section 19 of the Employment Relations Act 1999. They came into force on 1 July 2000. Background With the encouragement of the leader of the Western Circuit, Mr OBrien, who was then in practice as a barrister, decided to apply to become a recorder. He was appointed as a recorder with effect from 1 March 1978, and he continued sitting as a recorder with regular extensions until he ceased to hold that office on 31 March 2005. The question then arose as to whether, as he was no longer the holder of a judicial office, he was entitled to a pension under the judicial pension scheme. The office of recorder is not one of the judicial offices for which provision for the payment of pensions was made in the Judicial Pensions Act 1981. Further provisions for the payment of pensions to judicial office holders are contained in the Judicial Pensions and Retirement Act 1993 (the 1993 Act). Section 2 of the 1993 Act provides that any person retiring from qualifying judicial office having attained the age of 65 and having completed at least 5 years service in qualifying judicial office is entitled to receive a pension at the appropriate annual rate. Section 1(6) provides that, for the purposes of the Act, any reference to a qualifying office is a reference to any office specified in Schedule 1 to the Act if that office is held on a salaried basis. The office of recorder is not one of the offices specified in Schedule 1. On 9 June 2005 Mr OBrien wrote to the Department of Constitutional Affairs requiring that he be paid a retirement pension on the same basis, adjusted pro rata temporis, as that paid to former full time judges who had been engaged on the same or similar work. He was informed by the Department in its reply dated 5 July 2005 that he fell outside the categories of judicial office holder to whom a judicial pension was payable. This was because the office of recorder was not a qualifying judicial office under the 1993 Act, and because there was no obligation to provide him with a pension under European law as he was an office holder, not a worker. Mr OBrien was not satisfied with the reasons he was given. On 29 September 2005 he started proceedings in the Employment Tribunal in which he claimed among other things that he was being discriminated against because he was a part time worker. His claim was brought under the Equal Pay Act 1970, the Sex Discrimination Act 1975 and the Human Rights Act 1998 together with the PTWD and the 2000 Regulations. The claim was opposed by the Department of Constitutional Affairs (now the Ministry of Justice) unsuccessfully in the Employment Tribunal, but successfully on appeal to the Employment Appeal Tribunal, on the grounds that it was out of time, as it ought to have been presented within three months of the date when he ceased to hold office, and that there was no relevant statutory extension of the time within which a claim could be presented. But it was later ordered, by consent, that the substantive issue and the time limit issue should both be heard by the Court of Appeal as a test case. On 19 December 2008 the Court of Appeal (the Chancellor, Smith and Maurice Kay LJJ) allowed Mr OBriens appeal on the time limit issue, but directed the Employment Tribunal to dismiss the claim on the issue of substance: Department of Constitutional Affairs v OBrien [2008] EWCA Civ 1448, [2009] ICR 593, [2009] 2 CMLR 15. Its findings on the substantive issue were that judges are not workers, either under the main definition in regulation 1(2) of the 2000 Regulations which requires there to be a contract or under the extended definition of worker in regulation 12 which applies to Crown employment: see paras 15 and 17, below. Mr OBrien was given permission to appeal to the Supreme Court. On 28 July 2010 this court, having considered the parties written and oral submissions and submissions for the Council of Immigration Judges as interveners, referred two questions to the CJEU for a preliminary ruling under Article 267 TFEU: see [2010] UKSC 34, [2011] 1 CMLR 36, to which reference may be made for much of the background. The questions that were referred were as follows: 1) Is it for national law to determine whether or not judges as a whole are workers who have an employment contract or employment relationship within the meaning of clause 2.1 of the Framework Agreement, or is there a Community norm by which this matter must be determined? 2) If judges as a whole are workers who have an employment contract or employment relationship within the meaning of clause 2.1 of the Framework Agreement, is it permissible for national law to discriminate (a) between full time and part time judges, or (b) between different kinds of part time judges in the provision of pensions? On 1 March 2012 the Second Chamber of the CJEU, having received the opinion of the Advocate General (Kokott) on 17 November 2011, gave judgment. It answered the questions as follows [2012] ICR 955, para 68: 1) European Union law must be interpreted as meaning that it is for the member states to define the concept of workers who have an employment contract or an employment relationship in clause 2.1 of the Framework Agreement . and in particular, to determine whether judges fall within that concept, subject to the condition that that does not lead to the arbitrary exclusion of that category of persons from the protection offered by Directive 97/81, as amended by Directive 98/23, and that agreement. An exclusion from that protection may be allowed only if the relationship between judges and the Ministry of Justice is, by its nature, substantially different from that between employers and their employees falling, according to national law, under the category of workers. 2) The Framework Agreement . must be interpreted as meaning that it precludes, for the purpose of access to the retirement pension scheme, national law from establishing a distinction between full time judges and part time judges remunerated on a daily fee paid basis, unless such a difference in treatment is justified by objective reasons, which is a matter for the referring court to determine. The effect of the questions that were referred, and of the ruling in response to them, is to divide the issues raised by Mr OBriens case into two parts. Firstly, there is the worker issue: whether the relationship between judges and the Ministry of Justice is substantially different from that between employers and persons who fall to be treated in national law as workers. The principles to which the CJEU refers are of general application. So although the argument was directed to the position of recorders like Mr OBrien, the issue is of interest to all part time judges, not just recorders. Secondly, there is the objective justification issue: whether the difference in treatment of part time judges is justified by objective reasons. The answer to this issue may differ from one kind of non salaried part time judge to another. So, in addressing it, the court will confine its attention to recorders. The question is whether there is an objective justification for treating recorders, all of whom are non salaried, differently from full time or salaried judges for the purposes of access to the retirement pension scheme. The matter came before this court for a further oral hearing on 4 July 2012, when it also had before it written submissions on behalf of the Council of Immigration Judges. In the light of the discussion at that hearing the court made a preliminary ruling that Mr OBrien was at the material time a part time worker within the meaning of clause 2.1 of the Framework Agreement, for reasons that were to be given in writing at a later date. That ruling was communicated to the parties by the Registrar on 9 July 2012. The court also gave case management directions for the future course of the proceedings. The parties were told that the court had decided not to direct an immediate remission to the Employment Tribunal on the issue of objective justification, and that remission would be appropriate only if there were significant disputed issues of fact to be determined. Directions were given for the presentation of the parties cases on the objective justification issue as it applied to recorders at a further hearing to be held on 21 November 2012, at which the court would determine what issues, if any, should be remitted and decide any issues that were not to be remitted. This judgment does two things. First, it sets out the courts reasons for its preliminary ruling on the worker issue which, together with the introduction, have been prepared by Lord Hope. Secondly, it sets out the courts reasoning and conclusions on the issue of objective justification. They have been prepared by Lady Hale. The court acknowledges and is grateful for all the work by the legal advisers on both sides in preparing a considerable volume of documentary evidence and other material against a demanding timetable. The PTWD and the Framework Agreement The PTWD contains in recital (11) a reference to the parties to the Framework Agreement wishing to establish a general framework for eliminating discrimination against part time workers and to contribute to developing the potential for part time work on a basis which is acceptable for employers and workers alike. Recital (16) is as follows: Whereas, with regard to terms used in the Framework Agreement which are not specifically defined therein, this Directive leaves Member States free to define those terms in accordance with national law and practice, as is the case for other social policy Directives using similar terms, providing that the said definitions respect the content of the Framework Agreement. Article 1 states that the purpose of the Directive is to implement the Framework Agreement. Article 2 requires Member States to transpose it into national law by 20 January 2000 at the latest. Clauses 1 and 2 of the Framework Agreement are as follows: Clause 1: Purpose The purpose of this Framework Agreement is: (a) to provide for the removal of discrimination against part time workers and to improve the quality of part time work; (b) to facilitate the development of part time work on a voluntary basis and to contribute to the flexible organization of working time in a manner which takes into account the needs of employers and workers. Clause 2: Scope 1. This Agreement applies to part time workers who have an employment contract or employment relationship as defined by the law, collective agreement or practice in force in each Member State. 2. Member States, after consultation with the social partners in accordance with national law, collective agreements or practice, and/or the social partners at the appropriate level in conformity with national industrial relations practice may, for objective reasons, exclude wholly or partly from the terms of this Agreement part time workers who work on a casual basis. Such exclusions should be reviewed periodically to establish if the objective reasons for making them remain valid. The Ministry of Justice do not place any reliance on Clause 2(2). Clause 3 contains definitions of part time worker and comparable full time worker. Clause 4 sets out the principle of non discrimination: Clause 4: Principle of non discrimination 1. In respect of employment conditions, part time workers shall not be treated in a less favourable manner than comparable full time workers solely because they work part time unless different treatment is justified on objective grounds. 2. Where appropriate, the principle of pro rata temporis shall apply. 3. The arrangements for the application of this clause shall be defined by the Member States and/or social partners, having regard to European legislation, national law, collective agreements and practice. 4. Where justified by objective reasons, Member States after consultation of the social partners in accordance with national law, collective agreements or practice and/or social partners may, where appropriate, make access to particular conditions of employment subject to a period of service, time worked or earnings qualification. Qualifications relating to access by part time workers to particular conditions of employment should be reviewed periodically having regard to the principle of non discrimination as expressed in Clause 4.1. The domestic regulations The United Kingdom gave effect to the PTWD and the Framework Agreement by the 2000 Regulations which were made on 8 June 2000 and came into force on 1 July 2000. The Regulations were made under section 19 of the Employment Relations Act 1999. Regulation 1(2) contains definitions, including: contract of employment means a contract of service or of apprenticeship, whether express or implied, and (if it is express) whether oral or in writing; worker means an individual who has entered into or works under or (except where a provision of these Regulations otherwise requires) where the employment has ceased, worked under (a) a contract of employment; or (b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual. There is no reference to employment relationship. Regulation 2 (as amended) contains definitions of a full time worker, a part time worker and a comparable full time worker. It is common ground that if Mr OBrien was a worker at all, he was a part time worker. Regulation 5 sets out the prohibition on unjustified less favourable treatment of part time workers: 5. Less favourable treatment of part time workers (1) A part time worker has the right not to be treated by his employer less favourably than the employer treats a comparable full time worker (a) as regards the terms of his contract; or (b) by being subjected to any other detriment by any act, or deliberate failure to act, of his employer. (2) The right conferred by paragraph (1) applies only if (a) the treatment is on the ground that the worker is a part time worker, and (b) the treatment is not justified on objective grounds. (3) In determining whether a part time worker has been treated less favourably than a comparable full time worker the pro rata principle shall be applied unless it is inappropriate. Part IV of the regulations is headed Special Classes of Person and contains six Regulations numbered 12 to 17. Regulation 12 (Crown employment) provides (so far as now material): (1) Subject to regulation 13, these Regulations have effect in relation to Crown employment and persons in Crown employment as they have effect in relation to other employment and other employees and workers. (2) In paragraph (1) Crown employment means employment under or for the purposes of a government department or any officer or body exercising on behalf of the Crown functions conferred by a statutory provision. Regulations 13 (Armed forces), 14 (House of Lords staff), 15 (House of Commons staff) and 16 (Police service) make similar provision for the classes of service personnel, office holders or employees to which they relate (but subject to an exception for certain types of military training under the Reserve Forces Acts). Subject to that exception, all these provisions include within the scope of the Regulations persons who would not or might not otherwise be included. By contrast regulation 17 (Holders of judicial offices) disapplies the Regulations in relation to fee paid part time judges: These Regulations do not apply to any individual in his capacity as the holder of a judicial office if he is remunerated on a daily fee paid basis. The parties take different views as to whether, in the absence of regulation 17, fee paid part time judges would have been treated as part time workers for the purposes of the Regulations. The facts Until the 1970s part time judges, variously styled as recorders, commissioners or chairmen of Quarter Sessions, were a smaller proportion of the judiciary in England and Wales than they are now. Many part time judicial officers who are now called judges were then designated by other terms such as registrars, stipendiary magistrates, tribunal chairmen and social security or tax commissioners. Professor Bell, Judiciaries in Europe (2006), p 312 records that in 1970 full time judges outnumbered part time judges by about three to one. All these part time judges were the holders of a statutory judicial office. They were remunerated by fees calculated on a daily fee paid basis. The Courts Act 1971 made major changes in the justice system and (as amended) conferred the powers under which all recorders are still appointed. Section 21 of the Courts Act 1971, as originally enacted, was in the following terms: (1) Her Majesty may from time to time appoint qualified persons, to be known as Recorders, to act as part time judges of the Crown Court and to carry out such other judicial functions as may be conferred on them under this or any other enactment. (2) Every appointment of a person to be a Recorder shall be of a person recommended to Her Majesty by the Lord Chancellor, and no person shall be qualified to be appointed a Recorder unless he is a barrister or solicitor of at least ten years standing. (3) The appointment of a person as a Recorder shall specify the term for which he is appointed and the frequency and duration of the occasions during that term on which he will be required to be available to undertake the duties of a Recorder. (4) Subject to subsection (5) below the Lord Chancellor may, with the agreement of the Recorder concerned, from time to time extend for such period as he thinks appropriate the term for which a Recorder is appointed. (5) Neither the initial term for which a Recorder is appointed nor any extension of that term under subsection (4) above shall be such as to continue his appointment as a Recorder after the end of the completed year of service in which he attains the age of 72. (6) The Lord Chancellor may if he thinks fit terminate the appointment of a Recorder on the ground of incapacity or misbehaviour or of a failure to comply with any requirement specified under subsection (3) above in the terms of his appointment. (7) There shall be paid to Recorders out of money provided by Parliament such remuneration and allowances as the Lord Chancellor may, with the approval of the Minister for the Civil Service, determine. The section has been amended from time to time. The most significant amendment, influenced by the Human Rights Act 1998, was the introduction of safeguards limiting the Lord Chancellors right to decline to extend, or to terminate, an appointment. This amendment gave effect to new terms and conditions of service promulgated by the Lord Chancellors Department in 2000. Recorders appointments are automatically extended under section 21(4) at the end of the five year appointment for further successive terms of five years, subject to the individuals agreement and the upper age limit, unless a question of cause for non renewal is raised or the individual no longer satisfies the conditions or qualifications for appointment. Since the Courts Act 1971 was enacted there has been a remarkable growth in the number and type of part time judges. The Council of Immigration Judges estimate that there are now about thirty types of fee paid part time judges in the United Kingdom, and that they are relied upon substantially in all but three specialist tribunals. Statistics in Professor Bells chapter (table 6.1a) show that there were 2,041 part time judges (recorders and deputy district judges) in 1993 and 2,414 in 2005 (including 200 female deputy district judges, up from 89 in 1993, indicating the success of the official policy of encouraging women to become part time judges). There are now almost twice as many part time judges (recorders and deputy district judges) as full time judges. These figures do not take account of remunerated chairmen and members of tribunals, the structure of which has been radically reformed by the Tribunals Courts and Enforcement Act 2007. Submissions from the Council of Immigration Judges show that in 2009 there were 145 full time immigration judges and 440 part time immigration judges (the latter group being divided between salaried part time judges and fee paid part time judges as mentioned below). The proportion of sitting days worked by fee paid judges rose from 49% in 2008 to 72% in 2010 and 2011. For about 30 years after the Courts Act 1971 all part time judges were remunerated on a fee paid basis. That was not a statutory requirement, as section 21(7) is in very general terms. It was an administrative arrangement chosen by the Lord Chancellors Department (later the Department of Constitutional Affairs, and now the Ministry of Justice). Since about 2000 there has been an increase in salaried part time judges, especially among district judges and immigration judges. As they are salaried holders of qualifying judicial offices, they are entitled to receive a judicial pension under the 1993 Act on their retirement. The Lord Chancellor has from time to time issued and amended written memoranda as to the terms and conditions of service of recorders. The memorandum current in 1978 when Mr OBrien was appointed contained 15 paragraphs covering, among other things, a requirement for attendance at sentencing conferences, and the frequency and duration of sittings and fees. There was a minimum sitting requirement of at least 20 days a year, which could be split into two periods of at least ten days. Subject to certain limitations provided for in the terms and conditions, he was not precluded from continuing in professional practice. Many recorders continued to provide services for remuneration as barristers or solicitors in addition to holding that judicial office. It was the expectation of the Lord Chancellor when preparing these memoranda that persons appointed as recorders would normally be in active practice or hold a full time judicial office. The version of the terms and conditions current at Mr OBriens retirement, which was issued in April 2000, is a more elaborate document of 49 paragraphs together with two appendices on relations with the media. Most of the new material dealt with the renewal of appointments and judicial conduct. A recorder is entitled to be offered a minimum of fifteen sitting days a year and may be required to sit for up to thirty days unless there are reasonable grounds for not sitting. The daily fee is unspecified. But in practice all part time judicial office holders are paid one 220th of the annual salary of a full time judicial office holder of the same court or tribunal. A fee at half the daily rate is paid for attending Judicial Studies Board residential conferences. The submissions for the Council of Immigration Judges state that some immigration judges work part time on a salaried basis. A substantial majority, estimated to be about 75%, work part time on a daily fee paid basis. Fee paid part time immigration judges sittings should not normally exceed 105 days a year, but for each days sitting an immigration judge is credited a further days work and pay for writing determinations and similar out of court duties. In practice they work up to 210 days per year. They are paid at about half a days fee to attend mandatory training days. Some immigration judges combine their work as a fee paid immigration judge with other fee paid judicial work in courts and other tribunals. But about half are estimated to rely on their remuneration as fee paid immigration judges as their principal income. All part time judges are entitled, where appropriate, to sick pay, maternity or paternity pay and similar benefits during service. Full time judges and salaried part time judges are entitled to pensions on retirement, subject to and in accordance with the provisions of the Judicial Pensions Act 1981 and the Judicial Pensions and Retirement Act 1993. Fee paid part time judges have no entitlement to a judicial pension on retirement. Pensions under the 1981 Act are calculated on a basis related to salary and, as already noted, references in the 1993 Act to a qualifying judicial office limit the entitlement to the holder of an office specified in Schedule 1 to the Act that is held on a salaried basis: 1993 Act, section 2(1). The worker issue The CJEU noted in paras 30 to 33 of its judgment that there is no single definition of worker in EU law. The PTWD and the Framework Agreement do not aim at complete harmonisation of national laws in this area, but only, as the agreements name indicates, to establish a general framework for eliminating discrimination against part time workers. It is for national law to determine whether a person in part time work has a contract of employment or an employment relationship: Wippel v Peek & Cloppenburg GmbH & Co KG C 313/02 [2005] 1CR 1604, para 40. The discretion given to member states is however qualified by the need to respect the effectiveness of the PTWD, and general principles of EU law: paras 34 to 38. A member state may not remove at will, in violation of the effectiveness of the directive, categories of persons from protection. In particular, the sole fact that judges are treated as judicial office holders is insufficient in itself to exclude the latter from enjoying the rights provided for by the Framework Agreement: para 41. Such an exclusion may be permitted, if it is not to be regarded as arbitrary, only if the nature of the employment relationship is substantially different from the relationship between employers and their employees which fall within the category of workers under national law. The CJEU stated in para 43 of its judgment: It is ultimately for the referring court to examine to what extent the relationship between judges and the Ministry of Justice is, by its nature, substantially different from an employment relationship between an employer and a worker. The court may, however, mention to the referring court a number of principles and criteria which it must take into account in the course of its examination. [emphasis added] The principles and criteria which it then set out include the following: (1) The term worker is used in the definition of the scope of the Framework Agreement to draw a distinction from a self employed person, and the court will have to bear in mind that this distinction is part of the spirit of the Framework Agreement on part time work: para 44, referring to para 48 of the opinion of the Advocate General. (2) The rules for appointing and removing judges must be considered, and also the way their work is organised. The fact that judges are expected to work during defined times and periods, albeit with a greater degree of flexibility than members of other professions, and that they are entitled to benefits such as sick pay are also relevant: paras 45 and 46. (3) The fact that judges are subject to terms of service and that they might be regarded as workers within the meaning of the Framework Agreement on part time work would not undermine the principle of the independence of the judiciary, or respect for the national identities of Member States. It merely aims to extend to those judges the scope of the principle of equal treatment and to protect them against discrimination as compared with full time workers: paras 47 to 49. At the hearing on 4 July 2012 there was argument about whether the case should be remitted to the Employment Tribunal for further fact finding on the issues of (i) whether Mr OBrien was a worker for EU law purposes, and (ii) objective justification. This court concluded, although only after the end of the oral argument, that it had sufficient evidence to determine the worker issue. It has also concluded that it need not, and should not, decide the very large question of whether all or any servants of the Crown have contracts of employment. Mr Allen QC for Mr OBrien pragmatically observed that his client wanted to win and that, so long as his client did so, he did not intend to press the court to express a view about the existence of a contract of employment. So the issue turns on whether there is an employment relationship in the relevant sense. Mr Allen pointed out that in making the reference to the CJEU the Supreme Court had already expressed the view that recorders are subject to the sort of terms of service referred to by Sir Robert Carswell LCJ in Perceval Price v Department of Economic Development [2000] IRLR 380. The claimants in that case were three female holders of full time judicial office. They brought claims on sex discrimination grounds, but the statutory provisions under which they were made excluded the holder of a statutory office. Giving the judgment of the court, Sir Robert Carswell pointed out that the purpose of article 119 of the Treaty and of the Equal Pay and Equal Treatment Directives was to protect against discrimination. At p 384 he said: All judges, at whatever level, share certain common characteristics. They all must enjoy independence of decision without direction from any source, which the respondents quite rightly defended as an essential part of their work. They all need some organisation of their sittings, whether it be prescribed by the president of the industrial tribunals or the Court Service, or more loosely arranged in collegiate fashion between the judges of a particular court. They are all expected to work during defined times and periods, whether they be rigidly laid down or managed by the judges themselves with a greater degree of flexibility. They are not free agents to work as and when they choose, as are self employed persons. Their office accordingly partakes of some of the characteristics of employment . Agreeing with these observations, this court said in para 27 of its judgment on the reference that judicial office partakes of most of the characteristics of employment. However, because domestic law could not readily be disentangled from EU law on this issue, it preferred to express no concluded view as to whether judges as a general class would qualify as workers under the Regulations, or whether Mr OBrien would qualify as a worker if regulation 17 were to be disregarded, until it had received guidance from the CJEU. Mr Allen submitted that nothing in the judgment of the CJEU tended to cast doubt on this courts provisional opinion. The argument for the Ministry of Justice is that there is no obligation to provide Mr OBrien with a pension under European law as he was a judicial office holder, not a worker. As Mr David Staff of the then Department of Constitutional Affairs explained in a statement that was shown to the Employment Tribunal, judicial office holders were seen as being in a distinct category with an entirely separate status. Fundamental to the concept of judicial independence was the fact that judicial office holders exercise their function wholly independently of influence or direction by any Minister, Government Department or agency. The CJEU has, however, made it clear that the principle that judges are independent in the exercise of the function of judging as such is not called into question by extending to part time judges the scope of the principle of equal treatment to protect them against discrimination as compared with full time workers: paras 47 49. In these paragraphs the court was, in effect, endorsing the observations of Advocate General Kokott, where she said in paras 50 51 of her opinion: 50 In this connection, I would also point out that it is difficult to determine how the rights granted by the Framework Agreement in general, and an entitlement to a retirement pension in particular, can jeopardise the essence of the independence of a judge; on the contrary, an entitlement to a retirement pension strengthens the economic independence of judges, and thus also the essence of their independence. 51 Independence in terms of the essence of an activity is not therefore an appropriate criterion for justifying the exclusion of a professional category form the scope of the Framework Agreement. In these circumstances Mr Cavanagh QC for the Ministry did not pursue the argument that the principle of the independence of the judiciary justified according a different status for the purposes of the Framework Agreement to recorders from that which governed ordinary departmental staff in the civil service. The fact that recorders are not subject to direction or control over the decisions that they take in the performance of the responsibilities of their office does not deprive them of the protection against discrimination that the Framework Agreement was designed to provide. Instead, recognising that this argument was no longer open to him, Mr Cavanagh confined his argument to addressing points of detail. He submitted that a recorders terms and conditions of service, as set out in a succession of memoranda from the Lord Chancellor, did not tell the whole story. It was, he submitted, necessary to go into the reality and substance of the matter. The issue could only be resolved if one was in possession of the full facts. In particular, evidence could usefully be heard about such matters as the way recorders were appointed and removed, the way their work was organised, whether sanctions were imposed upon recorders for sitting less than the minimum of 15 days a year and whether in practice the fixing and carrying out of sitting engagements was substantially different from the other professional commitments they undertook. He submitted that, while salaried part time judges would have a stronger case for being regarded as workers, fee paid part time judges are in a position similar to self employed persons. If the case were remitted to the Employment Tribunal, the evidence would show that the booking of judicial sittings by a recorder is similar to the booking of counsels engagements. One could not assume that the position of other judges was the same as that for recorders, although his position was that they all fell outside the definition of worker within the meaning of the Framework Agreement. As narrated in para 11, above, the court was satisfied that it was unnecessary to remit the matter to the Employment Tribunal on the worker issue, and that it should confirm its provisional view expressed in paragraph 27 of its judgment on the reference. Nothing in the judgment of the CJEU is inconsistent with that provisional view, and much of the judgment supports it. Following the guidance that the CJEU provided in para 43 of its judgment (see para 30, above), account in arriving at this decision was taken of the following matters mentioned in paras 44 46: (i) the fact that the character of the work that a recorder does in the public service differs from that of a self employed person; (ii) the rules for their appointment and removal, to which no self employed person would subject himself; (iii) the way their work is organised for them, bearing in mind that recorders, in common with all other part time judges, are expected to work during defined times and periods; (iv) their entitlement to the same benefits during service, as appropriate, as full time judges. The court does not accept that the terms and conditions laid down by the Lord Chancellor for recorders do not give a true picture of the reality of the work that is done by a recorder. On the contrary, Mr OBriens evidence shows that he was on one occasion required to explain why he had in two successive years failed to achieve the required number of sittings, and Mr OBrien had to explain and apologise. The reality is that recorders are expected to observe the terms and conditions of their appointment, and that they may be disciplined if they fail to do so. The very fact that most recorders are self employed barristers or solicitors merely serves to underline the different character of their commitment to the public service when they undertake the office of recorder. As the CJEU made clear in para 44, the spirit and purpose of the Framework Agreement requires that a distinction must be made between the category of worker and that of self employed persons. The matters referred to in the previous paragraph, taken together, really speak for themselves. The self employed person has the comparative luxury of independence. He can make his own choices as to the work he does and when and where he does it. He works for himself. He is not subject to the direction or control of others. Of course, he must adhere to the standards of his trade or profession. He must face the reality that, if he is to succeed, he must satisfy the needs and requirements of those who engage his services. They may be quite demanding, and the room for manoeuvre may be small. But the choices that must be made are for him, and him alone, to take. In Percy v Board of National Mission of the Church of Scotland [2005] UKHL 73, [2006] 2 AC 28, para 141, Lady Hale referred to the authors comment in Harvey on Industrial Relations and Employment Law, para A[4] that the distinction as to whether a person is in an employment relationship is between those who work for themselves and those who work for others, regardless of the nature of the contract under which they are employed. This was the same distinction that in para AG48 Advocate General Kokott said must be made in order to have regard to the spirit and purpose of the Framework Agreement. In para 145 Lady Hale quoted the passage from Sir Robert Carswells judgment in Perceval Price v Department of Economic Development [2000] IRLR 380, 384, where he said that judges are not free agents to work as and when they choose as are self employed persons, and that their office partakes of some of the characteristics of employment: see para 31, above. In para 146 Lady Hale went on to say this: I have quoted those words because they illustrate how the essential distinction is, as Harvey says, between the employed and the self employed. The fact that the worker has very considerable freedom and independence in how she performs the duties of her office does not take her outside the definition. Judges are servants of the law, in the sense that the law governs all that they do and decide, just as clergy are servants of God, in the sense that Gods word, as interpreted in the doctrine of their faith, governs all that they practise, preach and teach. This does not mean that they cannot be workers or in the employment of those who decide how their ministry should be put to the service of the Church. As that was a case about the rights of a member of the clergy, she did not say, and did not have to say, in so many words that judges can be workers. But in their case too, and especially in the case of those who work as part time judges, the same essential distinction between the employed and the self employed can be drawn. The fact is, as the matters referred to above make clear, that they are not free agents to work as and when they choose. They are not self employed persons when working in that capacity. For these reasons the court holds recorders are in an employment relationship within the meaning of clause 2.1 of the Framework Agreement on part time work and that, as the result to be achieved by the PTWD is binding on the United Kingdom, they must be treated as workers for the purposes of the 2000 Regulations. Objective justification The Part Time Workers Directive, like the Fixed term Work Directive, is unusual in allowing the justification of direct discrimination against part time workers. Clause 4.1 of the Framework Agreement (quoted at para 14 above) prohibits treating part time workers less favourably than comparable full time workers, solely because they work part time, unless different treatment is justified on objective grounds. Regulation 5(2) of the domestic 2000 Regulations (quoted at para 17 above) is to the same effect. However, clause 4.2 of the Framework Agreement sets out the general principle that where appropriate, the principle of pro rata temporis shall apply. Regulation 5(3) is to the same effect. Hence the usual expectation is that part time workers will receive the same remuneration and other benefits as comparable full time workers, calculated on a pro rata basis, unless there are objective grounds for departing from this principle. There is, however, little guidance from the CJEU as to what might constitute such objective grounds, other than that which we have been given in this particular case, at paras 64 to 66 of the judgment of the court: 64 . the concept objective grounds . must be understood as not permitting a difference in treatment between part time workers and full time workers to be justified on the basis that the difference is provided for by a general, abstract norm. On the contrary, that concept requires the unequal treatment at issue to respond to a genuine need, be appropriate for achieving the objective pursued and be necessary for that purpose: see, by way of analogy with clause 5.1(a) of the Framework Agreement on Fixed term Work, Del Cerro Alonso [2008] ICR 145, paras 57 and 58. 65 Since no justification has been relied on during the proceedings before the court, it is for the referring court to examine whether the inequality of the treatment between full time judges and part time judges remunerated on a daily fee paid basis may be justified. 66 It must be recalled that budgetary considerations cannot justify discrimination: see, to that effect, Schnheit v Stadt Frankfurt am Main (Joined Cases C 4/02 and C 5/02 [2003] ECR I 12575, para 85, and Zentralbetriebsrat der Landeskrankenhuser Tirols v Land Tirol (Case C 486/08) [2010] ECR I 3527, para 46. The first sentence of para 64 means no more than that it is not enough for a member state to provide for the difference in treatment in its law (or enforceable collective agreement): see Adeneler v Ellenikos Organismos Galaktos (Case C 212/04) [2006] ECR I 6057. The fact that regulation 17 of the domestic Regulations excludes fee paid part time judicial officers from the protection given by the Regulations is neither here nor there. The second sentence of para 64 repeats the familiar general principles applicable to objective justification: the difference in treatment must pursue a legitimate aim, must be suitable for achieving that objective, and must be reasonably necessary to do so. The opinion of Advocate General Kokott is slightly more expansive at para 62: 62 The unequal treatment at issue must therefore be justified by the existence of precise, concrete factors, characterising the employment condition concerned in its specific context and on the basis of objective and transparent criteria for examining the question whether that unequal treatment responds to a genuine need and whether it is appropriate and necessary for achieving the objective pursued: see Del Cerro Alonso [2008] ICR 145, para 58, and Ang Serrano v European Parliament (Case C 496/08P) [2010] ECR I 1793, para 44. This court proposes to follow the guidance given by the CJEU and the Advocate General in those passages. Although the CJEU did not repeat the first part of para 62 of the Advocate Generals opinion, it is merely a longer quotation from para 58 of the judgment in Del Cerro Alonso v Osakidetza Sevvicio Vasco del Salud [2008] ICR 145 which the court did cite. The Ministry of Justice face the difficulty that they have not until now articulated a justification for their policy. It is clear from the history that when the 2000 Regulations were made the Lord Chancellor took the view that judges were not workers for this purpose, a view which was maintained until this court rejected it following the renewed hearing of this case in July 2012. This does not preclude the Ministry from now advancing a justification for maintaining the policy: see Seldon v Clarkson Wright & Jakes [2012] UKSC 16, [2012] ICR 716, para 60, citing Petersen v Berufsausschuss fr Zahnrtze fr den Bezirk Westfalen Lippe (Case C 341/08) [2010] ECR I 47. It is also clear from the history that, insofar as there was a reason for ensuring that fee paid part time judges were not covered by the 2000 Regulations, it was to save cost. By itself, of course, this cannot constitute justification. But once again, this does not preclude the Ministry from now advancing a different and better justification: see Finalarte Sociedade Construo Civil Lda v Urlaubs und Lohnausgleichskasse der Bauwirtschaft (Cases C 49/98, C 50/98, C 52/98 to C 54/98 and C 68/98 to C 71/98) [2003] 2 CMLR 11. However, in this as in any other human rights context, this court is likely to treat with greater respect a justification for a policy which was carefully thought through by reference to the relevant principles at the time when it was adopted: see Belfast City Council v Miss Behavin Ltd [2007] UKHL 19, [2007] 1 WLR 1420, paras 26 and 37; R (SB) v Governors of Denbigh High School [2006] UKHL 15, [2007] 1 AC 100, para 31. In particular, as Mummery LJ pointed out in R (Elias) v Secretary of State for Defence [2006] EWCA Civ 1293, [2006] 1 WLR 3213, at paras 128 to 132, it is difficult for the Ministry to justify the proportionality of the means chosen to carry out their aims if they did not conduct the exercise of examining the alternatives or gather the necessary evidence to inform the choice at that time. treatment complained of: In their pleaded case, the Ministry advance three inter related aims for the (i) fairness in the distribution of the States resources that are available to fund judicial pensions; (ii) to attract a sufficiently high number of good quality candidates to salaried judicial office; and (iii) to keep the cost of judicial pensions within limits which are affordable and sustainable. In Mr Cavanaghs written and oral submissions on their behalf, fairness was divided into two elements: (a) the alternative opportunities available to part timers, but denied to full timers, to make provision for their retirement; and (b) the greater contribution made by the full timers to the working of the justice system. Remission? Before considering each of these suggested justifications, it is necessary to consider whether the case should be remitted to the Employment Tribunal for the determination of any relevant disputed facts. The Ministry, Mr OBrien and the interveners have all filed extensive evidence in accordance with this courts directions in July 2012. While much is agreed, Mr Cavanagh argues that there are five key areas of dispute: (i) the extent to which Recorders also have practices as barristers or solicitors; (ii) the number of days which Recorders are required to sit in a year and the extent of the flexibility which they are allowed in order to accommodate the demands of their practices; (iii) whether the work of Recorders is in general less onerous than the work of Circuit Judges; (iv) the extent to which Recorders suffer a drop in pay if they become Circuit Judges and whether there would be a drop in high quality candidates for full time appointment if the pensions payable to full timers were reduced; and (v) how much it would cost to provide pro rata pensions to Recorders. Mr Cavanagh acknowledges that the most important areas are (i) and (iii), as these are directly relevant to the fairness justification. Once the arguments were examined in detail, however, it became apparent that resolving these factual issues would not resolve the central issue of whether the discrimination is objectively justified. To the extent that it might do so, the court was content to take the factual basis of the Ministrys case at the highest at which it could properly be put. Accordingly, the court decided not to remit for this purpose. Fairness: alternative means of providing for retirement The Ministry point out that recorders are far removed from the type of part time worker for whom the protection of the PTWD was designed. These were, it is said, low paid workers who were driven to take part time jobs by their personal circumstances, often their childcare or other domestic responsibilities, and were in a very weak bargaining position compared with their full time and more often unionised colleagues. Many of them were women. Indeed, before the PTWD, there were many cases decided where discrimination against part time workers was held to be indirect discrimination on grounds of sex because women were so much more likely to be adversely affected by it than men: see, for example, R v Secretary of State for Employment, Ex p Seymour Smith (No 2) [2000] 1 WLR 435. The aim of the Directive was to promote more flexible working patterns, by eliminating discrimination against part time workers and assisting the development of opportunities for part time working in a way which would benefit both employers and workers. Recorders, it is said, do not undertake their part time judicial work in order to prepare for retirement, reconcile professional and family life, and take up education and training opportunities (the reasons mentioned in the fifth of the General Considerations listed in the Framework Agreement for attaching importance to measures which would facilitate access to part time work). The great majority of recorders are either in practice at the Bar or as solicitors or hold other judicial offices as District or Tribunal Judges. A few may be employed, for example as academic lawyers or even Law Commissioners. The point is that they have a principal occupation which is not judging. This means that they can provide for their retirement in other ways: a sole practitioner such as a barrister can build up his own pension pot from his earnings at the Bar; a partner in a solicitors practice can take part in the firms pension scheme; an employed person can take part in his occupational or other pension arrangements. They do not need to rely upon a pension from their very limited time sitting in court. The availability of other resources has been taken into account in the justification of age discrimination: see, for example, Palacios de la Villa v Cartefiel Services SA (Case C 411/05) [2009] ICR 1111; Rosenbladt v Oellerking Gebudereinigungs GmbH (Case C 45/09) [2011] IRLR 51. Full timers, on the other hand, have hardly any opportunity for outside earnings and have no means other than the judicial pension scheme to make provision for their retirement. It is fair, therefore, that the limited sums available for judicial pensions should be allocated to the full timers (and to the salaried part timers) rather than to the fee paid part timers. The full timers need them and the part timers do not. The Ministry are able to make this argument with particular force because this case happens to be about a recorder. The great majority of recorders do have other sources of income from which to provide for their retirement. As the Council of Immigration Judges make clear, this is by no means true of many fee paid judicial officers. Some, indeed, are sitting virtually full time but on a part time fee paid basis. Some have a portfolio of fee paid offices which add up to a full time post. Some are sitting part time precisely because they need more flexible work to accommodate their domestic or other responsibilities. None of these have the opportunity to provide for their retirement out of other income. They are just the sort of people for whom the PTWD was designed. The fallacy in the Ministrys argument, it is said, is that fee paid part timers may (or may not) have the opportunity to provide for their retirement out of other earnings, but they do not have the opportunity to do so while they are engaged in their part time sittings. While engaged on judicial duties they are deprived of the opportunity to make other earnings and the pension contributions which could be made from them. Occupational pension schemes are part of the package of remuneration which goes with a particular occupation: they are often referred to as deferred pay. They are part of the price which the employer pays for the workers services. It would not be justifiable for an employer to pay a lesser daily rate to a fee paid part timer than to a full timer: indeed, recorders are paid a daily rate which is the equivalent pro rata temporis to the salary of a full time circuit judge, but without the pension element in the package. It is equally unjustifiable, it is said, to separate out the pension element in the remuneration package and refuse to apply the pro rata temporis principle to it. In this respect, it is irrelevant that the employer is the State. The Ministry should be regarded like any other employer. A private employer would not be able to justify paying part time workers less or denying them access to its occupational pension scheme and the State should be in no different position. At bottom, this is not an argument about fairness. It is premised on there being a limited pot of money available to fund judicial pensions. That, it is said, is an impermissible premise: budgetary considerations cannot justify discriminatory treatment. Fairness: the greater contribution made by full timers Another aspect of fairness, argue the Ministry, is that recorders generally do the less onerous work in the Crown and county courts. They only sit for a limited period each year and so cannot try the longer and more complicated cases, nor do they generally have to do the paperwork which the full time judges have to do. There are also a few, very limited, powers which are statutorily reserved to circuit judges. Against that, and with those very limited exceptions, it is said that the statutory jurisdiction of recorders is exactly the same as the jurisdiction of a circuit judge (as indeed the jurisdiction of a deputy district judge is exactly the same as the jurisdiction of a district judge). Certain types of work require a ticket for example, to try serious sexual offences, for child care cases, or for Technology and Construction Court work. But some recorders have such tickets (Mr OBrien, for example, was ticketed to do Technology and Construction Court work) and many circuit judges do not. Some recorders, especially if they sit in the smaller courts, may also be required to do paperwork. If circuit judges do undertake tasks which recorders are not required to undertake, the proper response is to reward these with extra responsibility payments, not to make a whole sale and indiscriminate exception to the pro rata temporis principle. A further aspect of this fairness argument, which tells against the Ministry, is that it suits Her Majestys Courts and Tribunals Service to have a cadre of fee paid part timers who can be flexibly deployed to meet the varying demands of court business. If all the work was done by full timers, there would have to be enough judges to cater for the busiest times. Inevitably, some would not have enough to do at other times. But once a judge is appointed to a full time post, it is not possible to dismiss him for redundancy. Appointing a large number of fee paid part timers enables the system to respond economically and flexibly to the fluctuations in demand for the courts services. Like a bank of agency nurses or supply teachers, it is an efficient method of working which benefits everyone. This efficiency should not be purchased at a price which discriminates against the part timers. Recruitment The Ministry argue that (even with the recent and proposed changes) the judicial pension scheme is a substantial incentive for high quality practitioners to seek and accept a full time appointment. It is a matter of general public importance that the remuneration package of circuit judges is sufficiently appealing to attract a sufficient number of high quality candidates. Barristers and solicitors in private practice frequently suffer a drop in income when they are appointed to the Bench. The pension sweetens the pill. This argument does, of course, assume that the persons best qualified to serve as circuit judges are the barristers and solicitors who have been most successful in private practice. Even assuming that to be the case, however, it is difficult to see why denying pensions to recorders increases the attractions of full time appointment. (It has echoes of the argument that denying the benefits of marriage to same sex couples increases the attractions of marriage to couples of opposite sexes.) The effect of paying pensions to part timers would be to increase their remuneration package for the limited number of days on which they sit. For recorders in particular, it would come nowhere close to making proper provision for their retirement. The pension entitlement attached to a full time appointment would still present a significant attraction, especially to a practitioner who had not already built up a very substantial pension pot of his own. Further, the Ministry do not argue that the recent and proposed changes to the judicial pension scheme, which will significantly reduce its attractiveness to the most successful practitioners, have had any impact upon the quantity and quality of applications for the full time Circuit bench. Quite the reverse. Their assessment of the impact of the introduction of contributions last year was that this would not have a significant effect upon recruitment. Promoting a high quality judicial system is of course a legitimate aim but it applies just as much to the part timers as to the full timers. Both must be of a high standard, so it is not an aim which divides them. While there is no evidence that the lack of a pension deters good quality candidates from applying to be recorders, the same may not be true of those parts of the justice system which rely upon fee paid part timers to do the great majority of the work. The Ministry accept that cost alone cannot justify discriminating against part time workers. But they argue that cost plus other factors may do so. This is a subtle point which is not without difficulty. The starting point for the discussion of this issue is the statement of the ECJ in MA de Weerd (Roks) v Bestuur Van de Bedrijfsvereniging voor de Gezondheid, Geestilijke en Maatschappelijke Belangen (Case C 343/92) [1994] 2 CMLR 325, a case about sex discrimination in social security benefits, at para 35: 35although budgetary considerations may influence a Member States choice of social policy and affect the nature or scope of the social protection measures it wishes to adopt, they cannot in themselves constitute the aim pursued by that policy and cannot, therefore, justify discrimination against one of the sexes. In other words, richer states may have more generous benefits systems than do poorer states. Cost may inform how much the state will spend upon its benefits system, but the choices made within that system must pursue policy aims other than saving cost. The court continued: 36 Moreover, to concede that budgetary considerations may justify a difference in treatment as between men and women which would otherwise constitute indirect discrimination on grounds of sex . would be to accept that the application and scope of as fundamental a rule of Community law as that of equal treatment between men and women might vary in time and place according to the state of the public finances of the Member States. It is one thing to set benefits at a particular level for budgetary reasons. It is another thing to pay women less than men because it is cheaper so to do. Sex discrimination is wrong whether the state (or the employer) is rich or poor. But, say the Ministry, the fact that a social policy aim is affected by budgetary considerations does not invalidate it if it is otherwise justified. Mr Cavanaghs best case is Jrgensen v Foreiningen af Speciallaeger and Sygesikringens Forhandlingsudvalg (Case C 226/98) [2000] IRLR 726. Mrs Jrgensen, a specialist rheumatologist, complained about a rule which meant that, if she sold her practice, it would, because of its turnover, be treated as a part time practice and subject to a cap on the fees it could receive from the Danish national health authorities. She argued that this was indirectly discriminatory on grounds of sex, because her lower turnover was the result of her domestic responsibilities, which affected many more women than men. The aim of the scheme which imposed the cap was to limit the exercise of part time specialist practice, it being considered that many doctors who worked principally in a hospital and part time in their own practices neglected the former for the sake of the latter. Among other questions, the Danish court asked the ECJ whether considerations relating to budgetary stringency, savings or medical practice planning might be regarded as objective considerations justifying a measure which adversely affected a larger number of women than men. In answering the question, the court repeated (at para 39) paragraphs 35 and 36 of Roks (see para 64 above) but agreed with the Commission that reasons relating to the need to ensure sound management of public expenditure on specialised medical care and to guarantee peoples access to such care are legitimate (at para 40). Their answer to the question was that budgetary considerations cannot in themselves justify discrimination on grounds of sex. However, measures intended to ensure sound management of public expenditure on specialised medical care and to guarantee peoples access to such care may be justified if they meet a legitimate objective of social policy, are appropriate to attain that objective and are necessary to that end (at para 42). If this is the Ministrys best case on budgetary considerations, it can be said, then it does not take them very far. Sound management of the public finances may be a legitimate aim, but that is very different from deliberately discriminating against part time workers in order to save money. In European Commission v The Netherlands (Case C 542/09), the Commission complained that imposing a residence requirement upon migrant workers and their families for eligibility for student support for courses outside the Netherlands breached the principle of non discrimination against migrant workers. The Netherlands argued that the requirement was necessary in order to avoid an unreasonable financial burden which could have consequences for the very existence of the assistance scheme (para 56). The court reiterated (at paras 57 and 58), mutatis mutandis, the principles set out in Roks (see para 64 above) and concluded that the objective pursued by the Kingdom of the Netherlands of avoiding an unreasonable financial burden cannot be regarded as an overriding reason relating to the public interest, capable of justifying the unequal treatment of workers from other Member States as compared with Netherlands workers (para 69). As Advocate General Sharpston had put it in her opinion, Any conditions attached to [the scheme] in order to keep expenditure within acceptable limits must be borne equally by migrant workers and Netherlands workers (para 89). On the other hand, the court held that the aim of promoting student mobility was legitimate and a residence requirement was an appropriate means of achieving that aim, as only students resident in the Netherlands would need to be encouraged to study elsewhere; but the Netherlands had not succeeded in establishing that the particular residence rule adopted did not go beyond what was necessary in order to achieve that objective. So a completely different aim might have been capable of justifying the policy. Hence the European cases clearly establish that a Member State may decide for itself how much it will spend upon its benefits system, or presumably upon its justice system, or indeed upon any other area of social policy. But within that system, the choices it makes must be consistent with the principles of equal treatment and non discrimination. A discriminatory rule or practice can only be justified by reference to a legitimate aim other than the simple saving of cost. No doubt it was because the CJEU foresaw that the Ministry would seek to rely upon considerations of cost when the case returned to the national courts that it took care to reiterate that budgetary considerations cannot justify discrimination (para 66). Our attention was drawn to some domestic authorities, and in particular to Woodcock v Cumbria Primary Care Trust [2012] EWCA Civ 330, [2012] ICR 1126. This was an age discrimination case, in which the claimant complained that the trust had deliberately failed to comply with a requirement to consult before declaring him to be redundant, so that his employment would cease before he reached the age which would trigger a higher severance payment. The Court of Appeal held that the dismissal notice was not served with the simple aim of dismissing him before his 49th birthday but in order to give effect to a genuine decision that his position was redundant. It was justifiable to implement that decision in a way which saved money. This court must, however, take its guidance from the jurisprudence of the CJEU, and in particular the guidance which we have been given in this very case. In the circumstances it is unnecessary for us to express a view upon whether the case of Woodcock was rightly decided. Conclusions We agree with the arguments advanced on behalf of Mr OBrien. The Ministry have struggled to explain what they are seeking to achieve by denying a pension to part timers while granting one to full timers. One aim seems to be to give a greater reward to those who are thought to need it most. This might be a legitimate aim, but (as Advocate General Kokott explained) the unequal treatment of different classes of employees must be justified by the existence of precise, concrete factors, characterising the employment condition concerned in its specific context and on the basis of objective and transparent criteria. An employer might devise a scheme which rewarded its workers according to need rather than to their contribution, but the criteria would have to be precise and transparent. That is not so here. Some part timers will need this provision as much as, if not more than, some of the full timers. On examination, this objective amounts to nothing more than a blanket discrimination between the different classes of worker, which would undermine the basic principle of the PTWD. Similarly (but inconsistently), an employer might aim to give a greater reward to those who make the greater contribution to the justice system, but the Ministry have failed to demonstrate that fee paid part timers, as a class, make a lesser contribution to the justice system than do full timers, as a class. Once again, the criteria for assessing such contributions are not precise and transparent. They amount to nothing more than a blanket discrimination between the two classes of worker. The proper approach to differential contributions is to make special payments for extra responsibilities. The argument also fails to take into account the benefits to the system in having a cadre of fee paid part timers who can be flexibly deployed to meet the changing demands upon it. The aim of recruiting a high quality judiciary is undoubtedly legitimate, but it applies to the part time judiciary as much as it applies to the full timers. Nor has it been shown that denying a pension to the part timers has a significant effect upon the recruitment of full timers. In effect, the arguments presented to us are the same as the arguments presented by the Kingdom of the Netherlands in Commission v The Netherlands: that if recorders get a pension, then the pensions payable to circuit judges will have to be reduced. That is a pure budgetary consideration. It depends upon the assumption that the present sums available for judicial pensions are fixed for all time. Of course there is not a bottomless fund of public money available. Of course we are currently living in very difficult times. But the fundamental principles of equal treatment cannot depend upon how much money happens to be available in the public coffers at any one particular time or upon how the State chooses to allocate the funds available between the various responsibilities it undertakes. That argument would not avail a private employer and it should not avail the State in its capacity as an employer. Even supposing that direct sex discrimination were justifiable, it would not be legitimate to pay women judges less than men judges on the basis that this would cost less, that more money would then be available to attract the best male candidates, or even on the basis that most women need less than most men. It follows that no objective justification has been shown for departing from the basic principle of remunerating part timers pro rata temporis. Although this case is concerned only with the case of a recorder, it seems unlikely that the Ministrys argument could be put any higher than it has been. The court holds that the appellant is entitled to a pension on terms equivalent to those applicable to a circuit judge. Disposal Trinity Term [2010] UKSC 34 On appeal from: [2008] EWCA Civ 1448 JUDGMENT O'Brien (Appellant) v Ministry of Justice (Formerly the Department for Constitutional Affairs) (Respondents) Lord Hope, Deputy President before Lord Walker Lady Hale Lord Clarke Lord Dyson 28 July 2010 JUDGMENT GIVEN ON Heard on 14 and 15 June 2010 Appellant Robin Allen QC Rachel Crasnow (Instructed by Browne Jacobson LLP) Respondent John Cavanagh QC Sarah Moore Holly Stout (Instructed by Treasury Solicitor) Intervener (Council of Immigration Judges) Ian Rogers (Instructed by Underwood Solicitors LLP) LORD WALKER (delivering the judgment of the court) Introductory 1. This appeal raises questions of EU law relating to Council Directive 97/81/EC of 15 December 1997 (the PTWD) concerning the Framework Agreement on part time work concluded by UNICE, CEEP and ETUC (the Framework Agreement) which the Court considers it necessary to refer to the Court of Justice under article 267 of the Treaty on the Functioning of the European Union. The appeal also raises questions of domestic law, as to the status and terms of service of judges in England and Wales (the term judges being here used as a compendious term so as to include, in general, chairmen and members of tribunals and others exercising judicial functions for remuneration, but not lay magistrates). The domestic law questions cannot easily be disentangled from the questions of EU law, partly because of the Marleasing principle (see Marleasing SA v La Comercial Internacional de Alimentacion SA C 106/89 [1991] I ECR 4135) and partly because Clause 2(1) of the Framework Agreement refers to employment contract or employment relationship as defined by the law, collective agreement or practice in force in each Member State. 2. This judgment is in five sections. The first section summarises the relevant parts of the PTWD, the Framework Agreement and the regulations transposing these EU measures into domestic law. The second and third sections set out the (largely undisputed) facts both as to the wider factual context (including the growing importance of part time judges in the English legal system) and as to Mr OBriens claim against the Ministry of Justice. The fourth section considers and gives this Courts opinion on the relevant principles of domestic law, but with the important qualification that (because of their entanglement with EU issues) some of the Courts conclusions must be treated as provisional, and may have to be revisited in the light of the Court of Justices preliminary ruling. The fifth and final section explains why a preliminary ruling is necessary, and sets out the questions referred to the Court of Justice. I The PTWD, the Framework Agreement and the domestic regulations 3. The PTWD contains in recital (11) a reference to the parties to the Framework Agreement wishing to establish a general framework for eliminating discrimination against part time workers and to contribute to developing the potential for part time work on a basis which is acceptable for employers and workers alike. Recital (16) is as follows: Whereas, with regard to terms used in the Framework Agreement which are not specifically defined therein, this Directive leaves Member States free to define those terms in accordance with national law and practice, as is the case for other social policy Directives using similar terms, providing that the said definitions respect the content of the Framework Agreement. Article 1 states that the purpose of the Directive is to implement the Framework Agreement. Article 2 requires Member States to transpose it into national law by 20 January 2000 at latest. 4. Clauses 1 and 2 of the Framework Agreement are as follows: Clause 1: Purpose The purpose of this Framework Agreement is: (a) to provide for the removal of discrimination against part time workers and to improve the quality of part time work; (b) to facilitate the development of part time work on a voluntary basis and to contribute to the flexible organization of working time in a manner which takes into account the needs of employers and workers. Clause 2: Scope 1. This Agreement applies to part time workers who have an employment contract or employment relationship as defined by the law, collective agreement or practice in force in each Member State. 2. Member States, after consultation with the social partners in accordance with national law, collective agreements or practice, and/or the social partners at the appropriate level in conformity with national industrial relations practice may, for objective reasons, exclude wholly or partly from the terms of this Agreement part time workers who work on a casual basis. Such exclusions should be reviewed periodically to establish if the objective reasons for making them remain valid. The Ministry of Justice does not place any reliance on Clause 2(2). Clause 3 contains definitions of part time worker and comparable full time worker. Clause 4 sets out the principle of non discrimination: Clause 4: Principle of non discrimination 1. In respect of employment conditions, part time workers shall not be treated in a less favourable manner than comparable full time workers solely because they work part time unless different treatment is justified on objective grounds. 2. Where appropriate, the principle of pro rata temporis shall apply. 3. The arrangements for the application of this clause shall be defined by the Member States and/or social partners, having regard to European legislation, national law, collective agreements and practice. 4. Where justified by objective reasons, Member States after consultation of the social partners in accordance with national law, collective agreements or practice and/or social partners may, where appropriate, make access to particular conditions of employment subject to a period of service, time worked or earnings qualification. Qualifications relating to access by part time workers to particular conditions of employment should be reviewed periodically having regard to the principle of non discrimination as expressed in Clause 4.1. 5. The PTWD did not initially apply to the United Kingdom. But Council Directive 98/23/EC of 7 April 1998 provided for it to apply to the United Kingdom with 7 April 2000 being substituted for 20 January 2000 as the final date for transposition. 6. The United Kingdom gave effect to the PTWD and the Framework Agreement by the Part time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (SI 2000 No.1551) (the Regulations) which were made on 8 June 2000 and came into force on 1 July 2000. The Regulations were made under section 19 of the Employment Relations Act 1999. 7. Regulation 1(2) contains definitions, including: contract of employment means a contract of service or of apprenticeship, whether express or implied, and (if it is express) whether oral or in writing; worker means an individual who has entered into or works under or (except where a provision of these Regulations otherwise requires) where the employment has ceased, worked under (a) a contract of employment; or (b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual. There is no reference to employment relationship. Regulation 2 (as amended) contains definitions of a full time worker, a part time worker and a comparable full time worker. It is common ground that if Mr OBrien was a worker at all, he was a part time worker. 8. Regulation 5 sets out the prohibition on unjustified less favourable treatment of part time workers: 5. Less favourable treatment of part time workers (1) A part time worker has the right not to be treated by his employer less favourably than the employer treats a comparable full time worker (a) as regards the terms of his contract; or (b) by being subjected to any other detriment by any act, or deliberate failure to act, of his employer. (2) The right conferred by paragraph (1) applies only if (a) the treatment is on the ground that the worker is a part time worker, and (b) the treatment is not justified on objective grounds. (3) In determining whether a part time worker has been treated less favourably than a comparable full time worker the pro rata principle shall be applied unless it is inappropriate. Part IV of the Regulations is headed Special Classes of Person and 9. contains six Regulations numbered 12 to 17. Regulation 12 (Crown employment) provides (so far as now material) (1) Subject to regulation 13, these Regulations have effect in relation to Crown employment and persons in Crown employment as they have effect in relation to other employment and other employees and workers. (2) In paragraph (1) Crown employment means employment under or for the purposes of a government department or any officer or body exercising on behalf of the Crown functions conferred by a statutory provision. Regulations 13 (Armed forces), 14 (House of Lords staff), 15 (House of Commons staff) and 16 (Police service) make similar provision for the classes of service personnel, office holders or employees to which they relate (but subject to an exception for certain types of military training under the Reserve Forces Acts). Subject to that exception all these provisions include within the scope of the Regulations persons who would not or might not otherwise be included. 10. By contrast Regulation 17 (Holders of judicial offices) disapplies the Regulations in relation to fee paid part time judges: These Regulations do not apply to any individual in his capacity as the holder of a judicial office if he is remunerated on a daily fee paid basis. The parties take different views as to whether, in the absence of Regulation 17, fee paid part time judges would have been treated as part time workers for the purposes of the Regulations. II The facts: the part time judiciary 11. Until the 1970s the English judicial system had relatively few part time judges, variously styled recorders, commissioners or chairmen of quarter sessions. All these part time judges were remunerated by fees calculated on a daily basis (fee paid). Professor Bell (Judiciaries in Europe (2006) p312) records that in 1970 full time judges outnumbered part time judges by about three to one. Many judicial officers who are now called judges were then designated by other terms such as registrars, stipendiary magistrates and social security or tax commissioners. 12. The Courts Act 1971 made major changes in the justice system and (as amended) conferred the powers under which all recorders are still appointed. Section 21 of the Courts Act 1971, as originally enacted, was in the following terms: (1) Her Majesty may from time to time appoint qualified persons, to be known as Recorders, to act as part time judges of the Crown Court and to carry out such other judicial functions as may be conferred on them under this or any other enactment. (2) Every appointment of a person to be a Recorder shall be of a person recommended to Her Majesty by the Lord Chancellor, and no person shall be qualified to be appointed a Recorder unless he is a barrister or solicitor of at least ten years standing. (3) The appointment of a person as a Recorder shall specify the term for which he is appointed and the frequency and duration of the occasions during that term on which he will be required to be available to undertake the duties of a Recorder. (4) Subject to subsection (5) below the Lord Chancellor may, with the agreement of the Recorder concerned, from time to time extend for such period as he thinks appropriate the term for which a Recorder is appointed. (5) Neither the initial term for which a Recorder is appointed nor any extension of that term under subsection (4) above shall be such as to continue his appointment as a Recorder after the end of the completed year of service in which he attains the age of 72. (6) The Lord Chancellor may if he thinks fit terminate the appointment of a Recorder on the ground of incapacity or mis behaviour or of a failure to comply with any requirements specified under subsection (3) above in the terms of his appointment. (7) There shall be paid to Recorders out of money provided by Parliament such remuneration and allowances as the Lord Chancellor may, with the approval of the Minister for the Civil Service, determine. The section has been amended from time to time. The most significant amendment, influenced by the Human Rights Act 1998, was the introduction of safeguards limiting the Lord Chancellors right to decline to extend, or to terminate, an appointment. This amendment gave effect to new terms and conditions of service promulgated by the Lord Chancellors Department (the predecessor to the Ministry of Justice) in 2000. 13. Since the Courts Act 1971 there has been a remarkable growth in the number of part time judges. Statistics in Professor Bells chapter (table 6.1a) show that there were 2,041 part time judges (recorders and deputy district judges) in 1993 and 2,414 in 2005 (including 200 female deputy district judges, up from 89 in 1993, indicating the success of the official policy of encouraging women to become part time judges). There are now almost twice as many part time judges (recorders and deputy district judges) as full time judges. These figures do not take account of remunerated chairmen and members of tribunals, the structure of which has been radically reformed by the Tribunals Courts and Enforcement Act 2007. Submissions from the Council of Immigration Judges show that in 2009 there were 145 full time immigration judges and 440 part time immigration judges (the latter group being divided between salaried part time judges and fee paid part time judges as mentioned below). 14. For about thirty years after the Courts Act 1971 all part time judges were remunerated on a fee paid basis. That was not a statutory requirement (section 21(7) is in very general terms) but it was the administrative arrangement chosen by the Lord Chancellors Department (later the Department of Constitutional Affairs, and now the Ministry of Justice). Since about 2000, however, there has been an increase in salaried part time judges, especially among district judges and immigration judges. 15. The Lord Chancellor has from time to time issued and amended written memoranda as to the terms and conditions of service of recorders. The memorandum current in 1978 (when Mr OBrien was appointed) contained fifteen paragraphs covering (among other things) the requirement for attendance at sentencing conferences, the frequency and duration of sittings (at least twenty days a year, which could be split into two periods of at least ten days) and fees (60 a day). The version (issued in April 2000) current at his retirement is a more elaborate document of 49 paragraphs together with two appendices (on relations with the media). Most of the new material dealt with the renewal of appointments and judicial conduct. A recorder was entitled to be offered a minimum of fifteen sitting days a year and might be required to sit for up to thirty days. The daily fee was unspecified but in practice was (and still is) 1 220th of the salary of a full time circuit judge. A fee at half the daily rate is paid for attending Judicial Studies Board residential conferences. The CIJs submissions state that fee paid part time immigration judges sittings should not normally exceed 105 days a year, and that for each days sitting an immigration judge is credited a further days work and pay for writing determinations and similar out of court duties. 16. All part time judges are entitled (where appropriate) to sick pay, maternity or paternity pay, and similar benefits during service. Full time judges and salaried part time judges are entitled to pensions on retirement, subject to and in accordance with the provisions of the Judicial Pensions Act 1981 as amended and the Judicial Pensions and Retirement Act 1993 as amended. Fee paid part time judges have no entitlement to a judicial pension on retirement. That is what Mr OBrien complains of in these proceedings. His complaint is founded on the PTWD and the Framework Agreement. III Facts relevant to Mr OBriens complaint 17. Mr OBrien was born in 1939 and called to the bar in 1962. From about 1970 his practice was in civil (as opposed to criminal) work on the western circuit. He was appointed Queens Counsel in 1983. 18. With the encouragement of the leader of the western circuit Mr OBrien applied to become a recorder and was appointed as a recorder with effect from 1 March 1978. He then continued sitting as a recorder until 31 March 2005, with regular extensions, the last extension being in 1999. In 1986 and 1987 he was unable to comply with his sitting requirement because he was engaged in a heavy case in Hong Kong. For this he received what he called a polite but firm reprimand from the Lord Chancellors Department. In 1998 the Department adopted the policy, set out in its memorandum of terms and conditions, of not renewing a recorders appointment beyond the year in which he or she attained the age of 65. From 2000 the policy was for recorders terms to be five years, automatically renewable except in the case of incapacity or misbehaviour. 19. Mr OBrien started proceedings in the Employment Tribunal on 29 September 2005. Initially his claim was opposed by the Department of Constitutional Affairs (now the Ministry of Justice) unsuccessfully in the Employment Tribunal, but successfully on appeal to the Employment Appeal Tribunal, on the ground that it was out of time. But it was later ordered, by consent, that the substantive issue and the time limit issue should both be heard by the Court of Appeal as a test case. On 19 December 2008 the Court of Appeal (the Chancellor and Smith and Maurice Kay LJJ) [2008] EWCA Civ 1448, [2009] ICR 593 allowed Mr OBriens appeal on the time limit issue, but directed the Employment Tribunal to dismiss the claim on the issue of substance. 20. Mr OBrien was given permission to appeal to the Supreme Court and this Court heard submissions on 14 and 15 June 2010. As often happens, each sides primary submission to the Court was that the matter was acte clair in its favour, and its secondary submission was that if the Court did not accept its primary submission, a reference under Article 267 was necessary. For the reasons set out at V below the Court accepts each sides secondary submission. IV Domestic law issues 21. Mr OBrien makes two main alternative submissions, described by his counsel as his high ground and low ground positions. These submissions were developed at length but essentially both are founded on the contention that as a recorder appointed under section 21 of the Courts Act 1971 (as amended) Mr OBrien worked for remuneration subject to terms and conditions akin to an employment contract. Either it was a contract, Mr OBrien says, of a type falling within the definition of worker in Regulation 1(2) of the Regulations (his high ground position) or there was an employment relationship falling within Clause 2(1) of the Framework Agreement (his low ground position). 22. By contrast the position of the Ministry of Justice is that Mr OBrien was not a person working under any sort of contract. He was, it is said, the holder of an office and (as the independence of the judiciary demands) was not subject to the direction of any employer. The fact that he was subject to income tax under Schedule E is of no assistance to him since income tax under Schedule E is charged on the earnings of an office or employment (Income Tax (Earnings and Pensions) Act 2003 section 5). 23. Both sides referred to numerous authorities, the most important being the decision of the House of Lords in Percy v Board of National Mission of the Church of Scotland [2005] UKHL 73 [2006] 2 AC 28. That case concerned a claim for sex discrimination by a female associate minister of the Church of Scotland. Her claim was made under the Sex Discrimination Act 1975, section 82(1) of which contains a definition of employment substantially similar (in its requirement of a contract of service or a contract for personal execution of work or labour) to that in the Regulations. The House of Lords, by a majority of four (Lord Nicholls, Lord Hope, Lord Scott and Lady Hale) to one (Lord Hoffmann) allowed Ms Percys appeal, holding that she was in employment and that the Employment Tribunal had jurisdiction to hear her claim. In Percy the majority held that tenure of an office does not necessarily 24. exclude employment, especially where there is a wide statutory definition of that term (see especially Lord Nicholls at paras 18 22, concurred in by Lord Scott and Lady Hale). Employment may extend beyond the traditional concept of a contract of service between master and servant (Lord Nicholls at para 13, Lord Hope at para 113, Lady Hale at para 141; compare Lord Hoffmann in dissent at para 66). The degree of control exercised over the employee is therefore less important, and in any case Ms Percy was, in that case, conducting her ministry under the control of a senior minister (Lord Nicholls at para 13, Lord Hope at para 127, Lady Hale at paras 145 146 and 148). 25. Lord Hoffmann (at para 73) and Lady Hale (at para 145) referred to the principle laid down by the Court of Justice in Lawrie Blum v Land Baden Wurttenberg C66/85 [1986] ECR 2121, para 17: That concept [worker] must be defined in accordance with objective criteria which distinguish the employment relationship by reference to the rights and duties of the persons concerned. The essential feature of an employment relationship, however, is that for a certain period of time a person performs services for and under the direction of another person in return for which he receives remuneration. That was a case on free movement of workers under what was then article 48 of the Treaty. The claimant was a trainee teacher working in Germany. As the Court of Justice was concerned with a fundamental freedom, the term worker had to be given an autonomous Community meaning, and the concept was to be interpreted broadly (para 16). 26. Lady Hale, at paras 143 148, gave detailed consideration to the decision of the Court of Appeal of Northern Ireland in Perceval Price v Department of Economic Development [2000] IRLR 380, a claim on sex discrimination grounds brought by three female holders of full time judicial office (two were chairmen of tribunals and one was a social security commissioner). Their claims were made under statutory provisions which excluded the holder of a statutory office, but the Court of Appeal of Northern Ireland disregarded the exclusion as being inconsistent with the Equal Treatment Directive 76/207/EEC of 9 February 1976 (which had direct effect). Sir Robert Carswell LCJ, giving the judgment of the court, pointed out that the purpose of article 119 of the Treaty and the Equal Pay and Equal Treatment Directives was to protect against discrimination and continued (p384): All judges, at whatever level, share certain common characteristics. They all must enjoy independence of decision without direction from any source, which the respondents quite rightly defended as an essential part of their work. They all need some organisation of their sittings, whether it be prescribed by the President of the Industrial Tribunals or the Court Service, or more loosely arranged in collegiate fashion between the judges of a particular court. They are all expected to work during defined times and periods, whether they be rigidly laid down or managed by the judges themselves with a greater degree of flexibility. They are not free agents to work as and when they choose, as are self employed persons. Their office accordingly partakes of some of the characteristics of employment . The Supreme Court agrees with these observations. 27. A recorder appointed under section 21 of the Courts Act 1971 (as amended) undoubtedly holds an office. Judicial office is one of the oldest and most important offices known to English law. That office is marked by a high degree of independence of judgment, as it must be in order to satisfy the requirements of Article 6 of the European Convention on Human Rights for an independent and impartial tribunal. A recorder, unlike the associate minister of religion in Percy, is not subject to the directions of any superior authority as to the way in which he or she performs the function of judging. Nevertheless recorders (and all judges at every level) are subject to terms of service of the sort referred to by Sir Robert Carswell LCJ. Indeed judicial office partakes of most of the characteristics of employment. However, because domestic law cannot readily be disentangled from EU law on this issue the Court prefers to express no concluded view, as to whether judges (as a general class) would qualify as workers under the Regulations, and as to whether Mr OBrien would qualify as a worker if regulation 17 were to be disregarded (in the same way as part of a domestic measure was disregarded in Perceval Price v Department of Economic Development). V The need for a reference to the Court of Justice 28. In approaching the EU issues this Court considers that three general points are clear. First, there is no single definition of worker which holds good for all the purposes of Community law: Martinez Sala v Freistaat Bayern C 85/96 [1998] ECR I 2691 para 31; Allonby v Accrington and Rossendale College C 256/01 [2004] ICR 1328. Second, in contrast to the position under other Directives (where references to workers have an autonomous European meaning) the effect of Clause 2(1) of the Framework Agreement, read together with Recital (16) of the PTWD, is to make domestic law relevant to the interpretation of the expression worker. Thirdly, however, domestic law is not to oust or trump the principles underlying the EU legislation in such a way as to frustrate them. Its underlying purposes must be (as Recital (16) puts it) respected. 29. The Court has heard sharply conflicting submissions as to how these general points, which are not in dispute, should be applied to the circumstances of Mr OBriens case. In particular the Court has heard detailed submissions on three comparatively recent decisions of the Court of Justice, that is Landeshauptstadt Kiel v Jaeger C 151/02 [2004] ICR 1528, Wippel v Peek & Cloppenburg GmbH & Co KG C 313/02 [2005] ICR 1604 and Del Cerro Alonso v Osakidetza (Servicio Vasco de Salud) C 307/05 [2008] ICR 145. 30. Jaeger was concerned with the application of the definition of working time in para 2(1) of the Working Time Directive 93/104/EC of 23 November 1993 to time spent on call by junior doctors in German hospitals: working time shall mean any period during which the worker is working, at the employers disposal and carrying out his activity or duties, in accordance with national laws and/or practice. The doctors had to be on call at the hospital, but when not actually working could sleep in accommodation provided for them at the hospital. 31. The Advocate General (Colomer) stated in para 36 of his opinion: despite the fact that article 2(1) of Directive 93/104 provides that the three criteria used to define working time are to be specifically delimited in accordance with national laws and/or practice, that stipulation does not mean that member states may refrain from applying those criteria and rely on rules of national law . However a member state may not rely on its own legislation to support the view that a doctor who carries out periods of duty on call in a hospital is not at the employers disposal at times when he is inactive but is waiting for his services to be called on again. 32. The Court of Justice stated (paras 58 and 59 of the judgment): In any event the concepts of working time and rest period within the meaning of Directive 93/104 may not be interpreted in accordance with the requirements of the various legislations of the member states, but constitute concepts of Community law which must be defined in accordance with objective characteristics by reference to the scheme and purpose of that Directive as the Court did in SIMAP, at p1147, paras 48 50. Only such an autonomous interpretation is capable of securing for that Directive full efficacy and uniform application of those concepts in all the member states. Accordingly, the fact that the definition of the concept of working time refers to national laws and/or practice does not mean that the member states may unilaterally determine the scope of that concept. Thus, those states may not make subject to any condition the right of employees to have working periods and corresponding rest periods duly taken into account, since that right stems directly from the provisions of that Directive. Any other interpretation would frustrate the objective of Directive 93/104 of harmonising the protection of the safety and health of workers by means of minimum requirements: see United Kingdom of Great Britain and Northern Ireland v Council of the European Union (Case C 84/94) [1999] ICR 443, 506, 510, paras 47 and 75. That passage has been adopted in another case on the Working Time Directive, Pfeiffer v Deutsches Rotes Kreuz C 397 403/01 [2005] ICR 1307, para 99. 33. These decisions seem to show that the need to make some reference to domestic law cannot be permitted to frustrate the overriding Community purpose of safeguarding the health and safety of workers. The Ministry of Justices written submissions (para 109) contend that a claim under the PTWD does not engage any fundamental Community right. But the aim of the PTWD and the Framework Agreement is to eliminate inequality and discrimination. As the Advocate General (Sharpston) stated in Istituto Nazionale della Previdenza Sociale v Bruno & Pettini C 395/08, para 119: The prohibition on discrimination in Clause 4 of the Framework Agreement is a particular expression of the general principle of equality. It must therefore be interpreted in accordance with that principle. Any national implementing measures must likewise respect the general principles of Community law, including the principle of equal treatment. The elimination of inequality and discrimination is at least as important a Community principle as the health and safety of workers. 34. Wippel was concerned with an Austrian part time worker whose contract was of an exiguous character in that she was not entitled to be offered any minimum amount of work, nor was she bound to accept work if it was offered. Nevertheless the Austrian Oberster Gerichtshof, in making its reference, stated that the claimant was recognised as a worker by domestic law. She was therefore within para 2(1) of the Framework Agreement. 35. In that case the Advocate General (Kokott) stated (para 45): Consequently, for the purposes of the Framework Agreement, the term worker is not a Community law concept. Indeed, the personal scope of application of the Framework Agreement is defined by reference to the national law applicable in each case. The term worker therefore has to be defined in reliance on the law, collective agreements and practices in force in each member state. The member states have wide discretionary powers in this respect. Only the very broadest limits can be determined in this respect by reference to Community law. It could therefore constitute a breach of the duty of co operation (article 10 EC) if a member state were to define the term worker so narrowly under its national law that the Framework Agreement on part time work were deprived of any validity in practice and achievement of its purpose, as stipulated in Clause 1, were greatly obstructed. However, there is no sign of that here. The Ministry of Justice relies heavily on this passage, as did the Court of Appeal ([2008] EWCA Civ 1448, para 46) following Elias J in Christie v Department of Constitutional Affairs [2007] ICR 1553, para 40. The Court of Justice reached the same conclusion as the Advocate General, but its judgment on the first question (paras 35 40) appears to give no support to her statement that member states have wide discretionary powers or that only the very broadest limits can be set by reference to Community law. 36. Del Cerro Alonso was concerned with workers in the Basque health service who were initially classified as temporary regulated staff but were then regraded as permanent staff. They were refused length of service allowances in respect of their service in the temporary grade and made complaints under Council Directive 99/70/EC of 28 June 1999 concerning the Framework Agreement on fixed term work. Their claims were resisted by the health service on the ground of objective justification, but the Kingdom of Spain intervened to contend that the regulated staff, as public sector workers, were completely outside the scope of the Directive (which contained a definition of worker in terms very similar to that in Clause 2(1) of the Framework Agreement under the PTWD). 37. The Advocate General (Poiares Maduro) considered this point in a long passage in his opinion (paras 11 15). It is sufficient to cite the conclusion in para 15: That conditional renvoi appears to me to be the process which is most faithful to both the letter and the spirit of the Community legislation. The effect of it is that the member state cannot merely rely on the formal or special nature of the rules applicable to certain employment relationships in order to exclude the latter from the benefit of the protection afforded by the Framework Agreement. If that were the case, there would be grounds for concern that the Framework Agreement could be rendered completely redundant. If it were the case, it would be open to any member state to make the contract staff of the public authorities subject to special rules in order to call in question the decisions adopted by the Court of Justice in Adeneler v Ellinikos Organismos Galaktos (ELOG) (Case C 212/04) [2006] ECR I 6057; Marrosu v Azienda Ospedaliera Ospedale San Martino di . Genova . (Case C 53/04) [2006] ECR I 7213 and Vassalo v Azienda Ospedaliera Ospedale San Martino di Genova . (Case C 180/04) [2006] ECR I 7251. Consequently, the exclusion of public servants from the scope of Directive 99/70 cannot be accepted unless it is demonstrated that the nature of the employment relationship between them and the administration is substantially different from that between employees falling, according to national law, within the category of workers and their employers. 38. The Court of Justice observed (para 29 of the judgment): The mere fact that a post may be classified as regulated under national law and has certain characteristics typical of the Civil Service in the member state in question is irrelevant in that regard. Otherwise, in reserving to member states the ability to remove at will certain categories of persons from the protection offered by Directive 99/70 and the Framework Agreement, the effectiveness of those Community instruments would be in jeopardy as would their uniform application in the member states: see, by analogy, Landeshauptstadt Kiel v Jaeger (Case C 151/02) [2004] ICR 1528, paras 58 and 59, and Pfeiffer v Deutsches Rotes Kreuz (Joined Cases C 397 403/01) [2005] ICR 1307, para 99. As is clear not only from the third paragraph of article 249 EC, but also from the first paragraph of article 2 of Directive 99/70, in light of recital (17) of the preamble to that Directive [which is identical to recital (16) of the PTWD] the member states are required to guarantee the result imposed by Community law: Adeneler [2006] ECR I 6057, para 68. 39. For the Ministry of Justice, the high point of these citations is the statement by Advocate General Kokott in Wippel that member states have wide discretionary powers (a statement not endorsed by the Court of Justice). For Mr OBrien the high point is the passage (set out in the last paragraph) from the judgment of the Court of Justice in Del Cerro Alonso. The jurisprudence of the Court of Justice appears to give little clear guidance as to what type of national deviation from the Community norm shows a lack of respect (Recital (16) of the PTWD), or is justified by the nature of the post or office being substantially different from that of normal workers (para 15 of the opinion of Advocate General Poiares Maduro in Del Cerro Alonso). 40. Accordingly the Supreme Court of the United Kingdom seeks guidance as to whether the permissibility of a national deviation from the Community norm should be judged by some or all of the following considerations: (1) the number of persons affected (large numbers of doctors and healthcare workers must have been affected by the issues raised in Jaeger and Del Cerro Alonso); or (2) the special position of the judiciary, for whose work independence of judgment, is an essential feature; or (3) the degree to which a particular exclusion under national law appears to have been effected with a particular Community measure in mind. In connection with this last point it is a particular cause for concern that the exclusion of fee paid part time judges by Regulation 17 of the Regulations has some appearance of being a deliberate ad hoc exclusion of a particular category while their full time or salaried part time colleagues, doing the same or similar work, will be entitled to judicial pensions on retirement. 41. The Supreme Court has therefore concluded that it is necessary to refer the following questions to the Court of Justice: (1) Is it for national law to determine whether or not judges as a whole are workers who have an employment contract or employment relationship within the meaning of clause 2.1 of the Framework Agreement, or is there a Community norm by which this matter must be determined? (2) If judges as a whole are workers who have an employment contract or employment relationship within the meaning of clause 2.1 of the Framework Agreement, is it permissible for national law to discriminate (a) between full time and part time judges, or (b) between different kinds of part time judges in the provision of pensions? For these reasons the appeal is allowed and the order of the Court of Appeal of 19 December 2008 is set aside. Working out exactly what this conclusion entails will not be without its difficulties. The case will be remitted to the Employment Tribunal for the determination of the amount of the pension to which Mr OBrien is entitled under the Regulations in accordance with this judgment.

This appeal raises questions of European Union law. These questions have their origins in an EU Framework Agreement on part time work which was concluded in 1997. It was implemented by a Council Directive of the same year, which was extended to the United Kingdom in 1998. Directives are binding as to the result to be achieved, leaving only the choice of form and methods to the Member State. The Council Directive was transposed into UK law by the Part time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (the 2000 Regulations). In essence, the 2000 Regulations provide that a part time worker has the right not to be treated by his employer less favourably than a comparable full time worker [2, 13 and 17]. Recorders are one of several types of part time judge who are paid a fee for their work. Mr OBrien is now a retired barrister. During his practice at the bar, he sat as a recorder from 1 March 1978 until 31 March 2005. Mr OBrien claimed to be entitled to a pension in respect of his part time non salaried judicial work as a recorder on the same basis, adjusted pro rata temporis, as that paid to former full time judges who had done the same or similar work. The then Department for Constitutional Affairs (DCA) told him that he was not entitled to a judicial pension since the office of recorder was not a qualifying judicial office under the relevant UK legislation and because, under European law, he was an office holder rather than a worker [1 and 5]. Mr OBrien began proceedings in the Employment Tribunal, claiming amongst other things that he was being discriminated against because he was a part time worker. His claim was successful but the DCA (now the Ministry of Justice (MoJ)) appealed successfully to the Employment Appeal Tribunal on the grounds that Mr OBriens claim was made after the relevant time limit. The Court of Appeal allowed Mr OBriens appeal on the time limit issue but directed the Employment Tribunal to dismiss his claim, since it found that judges were not workers under the 2000 Regulations [6 and 7]. Mr OBrien appealed to the Supreme Court which, in 2010, made a reference to the Court of Justice of the European Union (CJEU) for a preliminary ruling. Because domestic law could not readily be disentangled from EU law on the issue, the Supreme Court preferred to express no concluded view on whether Mr OBrien would qualify as a worker under the 2000 Regulations until it had received guidance from the CJEU. The CJEU issued its preliminary ruling, and the matter returned to the Supreme Court. The Supreme Court is obliged under section 3(1) of the European Communities Act 1972 to determine the questions of EU law in this case in accordance with the principles laid down in the CJEUs preliminary ruling [1, 8 and 33]. As a result of the questions that were referred and of the CJEUs preliminary ruling in response to them, there were two issues before the Supreme Court: (1) whether the relationship between the MoJ and judges is substantially different from that between employers and those treated in national law as workers (the worker issue); and (2) whether the difference in treatment of recorders as compared to full time or salaried judges for the purposes of access to the retirement pension scheme is justified by objective reasons (the objective justification issue). After a hearing in July 2012, the Supreme Court ruled that Mr OBrien was a part time worker within the meaning of the Framework Agreement. The parties were heard on the objective justification issue in November 2012. The judgment of the Supreme Court sets out the reasons for its ruling on the worker issue and its reasoning and conclusions on the objective justification issue [10 12]. The Supreme Court unanimously allows Mr OBriens appeal. Recorders are in an employment relationship within the meaning of the Framework Agreement on part time work and must be treated as workers for the purposes of the 2000 Regulations. No objective justification has been shown in this case for departing from the basic principle of paying a part time worker the same as a full time worker calculated on a pro rata temporis basis. Mr OBrien is entitled to a pension on terms equivalent to those applicable to a circuit judge. The case will be remitted to the Employment Tribunal for the determination of the amount of the pension to which he is entitled. The judgment is given by Lord Hope and Lady Hale [12, 42, 75 and 76]. The CJEU stated that it was ultimately for the Supreme Court to decide the worker issue, but it set out a number of factors which the Supreme Court had to take into account, including that the term worker in the Framework Agreement is used to draw a distinction from a self employed person, which distinction is part of the spirit of the Framework Agreement. In arriving at its ruling on the worker issue, and following the guidance from the CJEU, the Supreme Court took into account the following: (1) the character of the work that a recorder does in the public service differs from that of a self employed person; (2) the rules for the appointment and removal of recorders, to which no self employed person would subject himself; (3) the way recorders work is organised for them, bearing in mind that, in common with all other part time judges, recorders are expected to work during defined times and periods; and (4) recorders entitlement to the same benefits during service, as appropriate, as full time judges [30 and 37]. Recorders are expected to observe the terms and conditions of their appointment, and they may be disciplined if they fail to do so. The very fact that most recorders are self employed barristers or solicitors merely serves to underline the different character of their commitment to the public service when they undertake the office of recorder. As the CJEU made clear, the spirit and purpose of the Framework Agreement requires a distinction between worker and self employed person. When taken together, the matters taken into account by the Supreme Court following the guidance of the CJEU really speak for themselves. In the case of part time judges, the essential distinction between the employed and the self employed can be drawn. The self employed person has the comparative luxury of independence. Part time judges are not free agents to work as and when they choose. They are not self employed persons when working in that capacity [38 40]. The Supreme Court follows the guidance given by the CJEU and the Advocate General (who presents an impartial opinion on the case to assist the CJEU) in relation to the objective justification issue. To give a greater reward to those who are thought to need it most or alternatively to those who make the greater contribution to the justice system may be legitimate aims for the MoJ. However, they ultimately amount to nothing more than blanket discriminations between the different classes of worker, which would undermine the basic principle of the Council Directive. The criteria adopted in relation to each of the MoJs stated aims are not precise and transparent. In relation to the first aim, some part timers will need pension provision as much as, if not more than, some of the full timers. In relation to the second aim, the MoJ have failed to demonstrate that fee paid part timers, as a class, make a lesser contribution to the justice system than do full timers, as a class. The proper approach to differential contributions is to make special payments for extra responsibilities. The argument also fails to take into account the benefits to the system in having a cadre of fee paid part timers who can be flexibly deployed to meet the changing demands upon it. The aim of recruiting a high quality judiciary is undoubtedly legitimate, but it applies to the part time judiciary as much as it applies to the full timers. Nor has it been shown that denying a pension to the part timers has a significant effect upon the recruitment of full timers [71 73]. The MoJs argument was essentially that if recorders receive a pension, then the pensions payable to circuit judges will have to be reduced. That is a pure budgetary consideration which depends upon the assumption that the present sums available for judicial pensions are fixed for all time. Of course there is not a bottomless fund of public money available and we are currently living in very difficult times. But the fundamental principles of equal treatment cannot depend upon how much money happens to be available in the public coffers at any one particular time or upon how the State chooses to allocate the funds available between the various responsibilities it undertakes. That argument would not avail a private employer and it should not avail the State in its capacity as an employer [74].

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The principal issue in these two appeals relates to the circumstances in which the concept of statutory incompatibility will defeat an application to register land as a town or village green where the land is held by a public authority for statutory purposes. In R (Newhaven Port & Properties Ltd) v East Sussex County Council [2015] UKSC 7; [2015] AC 1547 (Newhaven) this court held that the duty under section 15 of the Commons Act 2006 did not extend to an area held under the specific statutes relating to the Newhaven Harbour. We are asked to decide whether the same principle applies to land held by statutory authorities under more general statutes, relating respectively (in these two cases) to education and health services. Although the two appeals raise similar issues, they were dealt with by different procedural routes. The first (Lancashire) is within the area of a pilot scheme under the Commons Registration (England) Regulations 2008, under which, where the registration authority (in this case Lancashire County Council LCC) has an interest in the land, applications are referred for determination to the Planning Inspectorate (regulations 27 28). The second case (Surrey) was not covered by the pilot scheme. The application was determined by Surrey County Council as registration authority, following a non statutory inquiry before a barrister appointed by the council. Modern greens development of the law As will be seen, in Newhaven the issue was described as one of statutory interpretation. Unfortunately, interpreting the will of Parliament in this context is problematic, because there is no indication that the concept of a modern green, as it has been developed by the courts, was part of the original thinking under the Commons Registration Act 1965. Lord Carnwath reviewed the earlier history, including the Report of the Royal Commission on Common Land 1955 1958 (1958) (Cmnd 462) which preceded the 1965 Act, in his judgments at first instance in R v Suffolk County Council, Ex p Steed (1995) 71 P & CR 463 (one of the first cases under the 1965 Act), and later in the Court of Appeal in Oxfordshire County Council v Oxford City Council [2006] Ch 43 (the Trap Grounds case). As he observed in the latter: 51. The concept of a modern class c green, as it has emerged in the cases since 1990, would, I think, have come as a surprise to the Royal Commissioners, and to the draftsman of the 1965 Act. There is no hint of it in the Royal Commission Report, or the Parliamentary Debates on the Bill. The commissioners terms of reference were directed to sorting out the problems of the past, not to creating new categories of open land, for which there was no obvious need. By this time, of course, there were numerous statutes conferring on public authorities modern powers for the creation and management of recreational spaces for the public. Lord Carnwath also noted, at para 52, that, as late as 1975, in New Windsor Corpn v Mellor [1976] Ch 380 (New Windsor), all three members of the Court of Appeal (including Lord Denning MR) had thought it natural to read the Act as referring to 20 years before the passing of the Act (at pp 391, 395) an interpretation which would have ruled out the possibility of a modern green being established by more recent use. It was not until the early 1990s that claims were first put forward based on 20 years use since the 1965 Act had come into force at the end of July 1970 (apparently following the advice of the Open Spaces Society in their publication Getting Greens Registered (1995)). When the first case came before the House of Lords in 1999 (R v Oxfordshire County Council, Ex p Sunningwell Parish Council [2000] 1 AC 335 Sunningwell), no one seems to have argued that the Act was directed to pre 1965 use only. In that case, the House of Lords, led by Lord Hoffmann, adopted a relatively expansive view of the new concept. He drew a parallel with the Rights of Way Act 1932, which he thought had reflected Parliaments view that the previous law gave too much weight to the interests of the landowner and too little to the preservation of rights of way which had been for many years in de facto use and the strong public interest in facilitating the preservation of footpaths for access to the countryside (p 359D E). He commented, at p 359E: in defining class c town or village greens by reference to similar criteria in 1965, Parliament recognised a similar public interest in the preservation of open spaces which had for many years been used for recreational purposes. That interpretation of Parliaments thinking would, with respect, have been difficult to deduce from the 1965 Act itself, or from anything said in Parliament or anywhere else at the time. However, when the issue came before the House again, in the Trap Grounds case [2006] 2 AC 674, Lord Hoffmann was able to claim implicit Parliamentary support in the debates which preceded the amendments made by the Countryside and Rights of Way Act 2000. As he said, at para 26: No one voiced any concern about the construction which the House in its judicial capacity had given to the 1965 Act. On the contrary, the only question raised in debate was whether the locality rule did not make it too difficult to register new village greens. By then, as he also noted (para 28) the new Commons Bill (the 2006 Act as it became) was before Parliament, providing a further opportunity for legislative reconsideration if thought appropriate. In Newhaven [2015] AC 1547, para 18, this fact was cited as a reason for not having given permission to reopen the general approach adopted in the Trap Grounds case. As to the attributes of a modern green, the 2006 Act itself, like the 1965 Act which preceded it, is very sparse in the information it gives. Section 1 of the 2006 Act requires each registration authority to maintain a register of town or village greens. Section 15 indicates that any person can apply to register land as a green where, in subsection (1)(a) a significant number of the inhabitants of any locality, or of any neighbourhood within a locality, have indulged as of right in lawful sports and pastimes on the land for the period of at least 20 years As to the purpose of registration, section 2(2)(a) states simply that the purpose of the register is to register land as a town or village green. The Act offers no further guidance as to the interpretation of the section 15 formula, nor as to the practical consequences of registration. An unexplained curiosity is that section 10 of the 1965 Act, which provided that the register was conclusive evidence of the matters registered, as at the date of registration, is not repeated in the 2006 Act. As things stand the repeal of section 10 has been brought into effect only in the pilot areas. (Section 18 of the 2006 Act, headed Conclusiveness, which has effect in the pilot areas, does not on its face go so far as section 10.) In the Trap Grounds case, Lord Hoffmann had agreed (at para 43) with Lord Carnwaths analysis in the Court of Appeal [2006] Ch 43, para 100, that the 1965 Act created no new legal status, and no new rights or liabilities other than those resulting from the proper interpretation of section 10. It was on the rational construction of section 10 that he relied for his view that land registered as a town or village green can be used generally for sports and pastimes (para 50), and was also subject to section 12 of the Inclosure Act 1857 and section 29 of the Commons Act 1876 (para 56). None of the experienced counsel before us was able to offer an explanation for the disappearance of section 10, but none sought to argue that it had made any material difference to the rights following registration. Not without some hesitation, we shall proceed on that basis. Lord Hoffmann made clear that, following registration, the owner was not excluded altogether, but retained the right to use the land in any way which does not interfere with the recreational rights of the inhabitants, with give and take on both sides (para 51). That qualification was further developed in R (Lewis) v Redcar and Cleveland Borough Council [2010] UKSC 1; [2010] 2 AC 70 (Lewis), in which it was held that the local inhabitants rights to use a green following registration could not interfere with competing activities of the landowner to a greater extent than during the qualifying period. One important control mechanism which emerged from the cases was the need for the use to be as of right. It was established that these words, by analogy with the law of easements, imported the principle nec vi, nec clam, nec precario, or in other words the absence of any of the three characteristics of compulsion, secrecy or licence (per Scott LJ in Jones v Bates [1938] 2 All ER 237, 245, cited by Lord Hoffmann in Sunningwell [2000] 1 AC 335, 355). It followed that in practice an owner could prevent use qualifying under section 15 by making it sufficiently clear to those seeking to use the land (generally by suitable notices) either that their use was objected to, or that it was permissive. On the other hand, silent acquiescence in the use, or toleration, did not prevent it being as of right. More recently (from 25 April 2013) amendments made by the Growth and Infrastructure Act 2013 (embodied in new sections 15A and following of the 2006 Act) have provided some assistance to landowners, first by enabling a formal statement to be made to bring user as of right to an end, and secondly by defining certain planning related trigger events which suspend or extinguish the right to apply to register a green. In Wiltshire Council v Cooper Estates Strategic Land Ltd [2019] EWCA Civ 840; [2019] PTSR 1980, para 4, Lewison LJ said of these amendments: Ever since the Trap Grounds case the courts have adopted a definition of a TVG [town or village green] which goes far beyond what the minds eye would think of as a traditional village green. The consequence of this interpretation of the definition is that there have been registered as TVGs: rocks, car parks, golf courses, school playgrounds, a quarry, scrubland, and part of a working port. If land is registered as a TVG the effect of the registration is, for practical purposes, to sterilise land for development. This became a concern for the Government, because the criteria for registration did not take into account any planning considerations; and because it was thought in some quarters that applications for registration of TVGs were being used as a means of stopping development outside the planning system. The 2013 amendments are of no direct relevance to the issues in the present appeal, but they are relied on as showing that Parliament has given specific attention to the balance to be drawn between the rights of the various interests involved. We would draw two main lessons from the historical review. First, whatever misgivings one may have about the unconventional process by which the concept of a modern green became part of our law, the emphasis now should be on consolidation, not innovation. Secondly, the balance between the interests of landowners and those claiming recreational rights, as established by the authorities, and as now supplemented by the 2013 Act, should be respected. Our task in the present appeal is not to make policy judgments, but simply to interpret the majority judgment in Newhaven and apply it to the facts of these cases. The proceedings and the parties Lancashire The land at issue in the first appeal is known as Moorside Fields, in Lancaster. It lies adjacent to Moorside Primary School and extends to some 13 hectares. It is divided into five areas, referred to in the proceedings as Areas A to E, described (by the planning inspector) as follows: Area A, referred to as the meadow was, until recently, an undeveloped plot of land. It is adjacent to Moorside Primary School (the school) and is currently being used to facilitate the construction of an extension at the rear of the school. Area B is a mowed field, referred to as the school playing field and both it and Area A are currently surrounded by fencing. Areas C and D border Areas A and B. In the past they have been the subject of mowing tenancy agreements but these ceased in around 2001. They are separated from each other and from Areas A and B by hedges and in places are overgrown with brambles. Area E, also adjacent to the school, is currently overgrown and difficult to access. At some times of the year it contains a pond. Like the school the land is owned by LCC, the present appellant, which is both education authority and registration authority. On 9 February 2010 Ms Janine Bebbington, a local resident, applied to register the land as a town or village green. Her application was based on 20 years qualifying use up to the date of registration, or alternatively up to 2008. LCC, as local education authority, objected. Following a statutory inquiry, an inspector appointed by the Secretary of State (Ms Alison Lea, a solicitor) in a decision letter dated 22 September 2015 determined that four of the five areas (that is A to D, but not E) should be registered under the Act. She excluded Area E because she found insufficient evidence of its use over the 20 year period. LCC has postponed formal registration of Areas A to D, pending the outcome of the judicial review claim. LCC maintains that the land was acquired for and remains appropriated to educational purposes, in exercise of the LCCs statutory powers as education authority. The statutory provisions upon which LCC relied (or now rely) as showing incompatibility were: (1) section 8 of the 1944 Education Act which imposed a duty on local education authorities to secure that there shall be available for their area sufficient schools for providing primary and secondary education, sufficient in number, character and equipment; (2) sections 13 and 14 of the Education Act 1996 which require local authorities to contribute to the development of the community by securing efficient primary and secondary education; (3) section 542 of the 1996 Act which requires school premises to conform to prescribed standards, including (under regulation 10 of the School Premises (England) Regulations (SI 2012/1943)) suitable outside space for physical education and outside play; and (4) section 175 of the Education Act 2002 which requires the education authority to make arrangements for ensuring that their education functions are exercised with a view to safeguarding and promoting the welfare of children. (The issue of safeguarding does not appear to have been raised at the inquiry.) The inspector was not satisfied that the land was held for educational purposes (an issue to which we shall return below), but even on the assumption that it was she found no incompatibility: 119. Furthermore, even if the land is held for educational purposes, I agree with the applicant that that could cover a range of actual uses. LCC states that the landholding is associated with a specific statutory duty to secure a sufficiency of schools and that if LCC needed to provide a new school or extra school accommodation in Lancaster in order to enable it to fulfil its statutory duty, it would not be able to do so on the Application Land were it to be registered as a town or village green. However, Areas A and B are marked on LCCs plan as Moorside Primary School. The school is currently being extended on other land and will, according to Lynn MacDonald [a school planning manager for the county council], provide 210 places which will meet current needs. There is no evidence to suggest that the school wishes to use these areas other than for outdoor activities and sports and such use is not necessarily incompatible with use by the inhabitants of the locality for lawful sports and pastimes. 120. Areas C and D are marked on LCCs plan as Replacement School Site. However, there is no evidence that a new school or extra school accommodation is required on this site, or indeed anywhere in Lancaster. Lynn MacDonald stated that the Application Land may need to be brought into education provision at some time but confirmed that there were no plans for the Application Land within her five year planning phase. 121. Nevertheless, she pointed out there is a rising birth rate and increased housing provision in Lancaster, and that although there are surplus school places to the north of the river, no other land is reserved for school use to the south of Lancaster. Assets are reviewed on an annual basis and if not needed land can be released for other purposes. However there was no prospect that this would happen in relation to the Application Land in the immediate future. 122. I do not agree with LCCs submission that the evidence of Lynn MacDonald demonstrates the necessity of keeping the Application Land available to guarantee adequate future school provision in order to meet LCCs statutory duty. Even if at some stage in the future there becomes a requirement for a new school or for additional school places within Lancaster, it is not necessarily the case that LCC would wish to make that provision on the Application Land. She concluded (para 124): 124. It seems to me that, in the absence of further evidence, the situation in the present case is not comparable to the statutory function of continuing to operate a working harbour where the consequences of registration as a town or village green on the working harbour were clear to their Lordships [in Newhaven]. Even if it is accepted that LCC hold the land for educational purposes, there is no clear incompatibility between LCCs statutory functions and registration of the Application Land as a town or village green. Accordingly I do not accept that the application should fail due to statutory incompatibility. On the LCCs application for judicial review, the inspectors decision was upheld by Ouseley J [2016] EWHC 1238 (Admin), including her approach to the issue of statutory incompatibility. Surrey The second appeal relates to some 2.9 hectares of land at Leach Grove Wood, Leatherhead, owned by NHS Property Services Ltd (NHS Property Services), a company wholly owned by the Secretary of State for Health. The land adjoins Leatherhead Hospital, and is in the same freehold title. An application for registration under the Act was made by Ms Philippa Cargill on 22 March 2013, with the support of Mr Timothy Jones and others. They relied on use over a period of 20 years ending in January 2013 (when permissive signs were erected on the land). At the time of the application, the land was owned by the Surrey Primary Care Trust. By section 83(1) of the National Health Service Act 2006 primary care trusts were under a duty to provide, or to secure the provision of, primary medical services in their area. The land was held by the Trust pursuant to the statute, for those purposes. On the dissolution of the Trust in 2013, the freehold title of the land was transferred to NHS Property Services, which had been created by the Secretary of State for Health under his power to form companies to provide facilities or services to persons or bodies exercising functions, or otherwise providing services, under this Act (section 223(1) of the National Health Service Act 2006). Following the amendment of the National Health Service Act 2006 by the Health and Social Care Act 2012, functions previously exercised by the Secretary of State acting through a primary care trust fell to be exercised by a clinical commissioning group (CCG) in this case the Surrey Downs Clinical Commissioning Group. The principal statutory duties of a CCG are defined by section 3(1) of the National Health Service Act 2006; in summary they involve the provision of hospital accommodation and medical services to such extent as it considers necessary to meet the reasonable requirements of the persons for whom it has responsibility. Following a non statutory inquiry, the inspector, William Webster, barrister, in his report dated 9 June 2015, recommended refusal of registration. He rejected the companys objection based on statutory incompatibility (paras 175(d) (f)). He contrasted the case with Newhaven [2015] AC 1547 in which there had been an obvious and irreconcilable clash as between the conflicting statutory regimes: (e) The position of the NHS is quite different in that no positive duty (analogous to that imposed on the undertaker in Newhaven) arises on the part of the landowner to do anything in the case of the land (in contrast to Newhaven) and the general duty imposed on the Secretary of State to promote a comprehensive health service is wholly unaffected. (f) It seems to me that it is irrelevant that the land may be held under the same title as the remainder of the hospital site. The fact that the relevant NHS bodies had (and still has [sic]) the capacity to use the land for health and ancillary purposes is no different to any other public body holding land for a purpose which they do not choose to exercise for the time being. He also accepted that there had been sufficient qualifying use of the land by local inhabitants for more than 20 years, but he held that it was not in respect of a relevant locality or neighbourhood as required by section 15. Surrey County Council, as registration authority, did not accept his recommendation, but determined to register the land which was done on 5 October 2015. On the application for judicial review by NHS Property Services, on 13 July 2016 Gilbart J ([2016] EWHC 1715 (Admin); [2017] 4 WLR 130) quashed the registration, holding that the county council had failed properly to consider the question of statutory incompatibility. He had before him the judgment of Ouseley J in the Lancashire case ([2016] EWHC 1238 (Admin)), but distinguished it by reference to the wider powers conferred by the education statutes: 134. It is clear that there was no general power in any of the relevant bodies to hold land. Land could only be acquired or held if done so for the purposes defined in the relevant Acts. The defined statutory purposes do not include recreation, or indeed anything outside the purview of (in summary) the purposes of providing health facilities. Could the land be used for the defined statutory purposes while also being used as a town or village green? No one has suggested that the land in its current state would perform any function related to those purposes, and the erection of buildings or facilities to provide treatment, or for administration of those facilities, or for car parking to serve them, would plainly conflict with recreational use. 135. Indeed, it is very hard indeed to think of a use for the land which is consistent with those powers, and which would not involve substantial conflict with use as a village green. A hospital car park, or a clinic, or an administrative building, or some other feature of a hospital or clinic would require buildings or hard standing in some form over a significant part of the area used. By contrast, it is easy to think of functions within the purview of education, whereby land is set aside for recreation. Indeed, there is a specific statutory duty to provide recreational facilities, which may include playing fields, and other land, for recreation, the playing of games, and camping, among other activities see section 507A Education Act 1996. 136. It is not relevant to the determination of the issue that the land has not in fact been used for the erection of hospital buildings or used for other hospital related purposes. The question which must be determined is not the factual one of whether it has been used, or indeed whether there any plans that it should be, but only whether there is incompatibility as a matter of statutory construction. If the land is in fact surplus to requirements, then the use of the [2006 Act] is not the remedy. 137. Given those conclusions, it is my judgement that there is a conflict between the statutory powers in this case and registration. The Court of Appeal The appeals in both cases, respectively by LCC and the applicants for registration in the Surrey case, were heard together by the Court of Appeal (Jackson, Lindblom and Thirlwall LJJ). In a judgment dated 12 April 2018 ([2018] EWCA Civ 721; [2018] 2 P & CR 15), given by Lindblom LJ, with whom the others agreed, the court upheld the decision to register in both cases. On the issue of statutory incompatibility, he distinguished the Newhaven case [2015] AC 1547, for reasons which are sufficiently apparent from the following short extracts from the judgment: Lancashire 40. Crucially, as a matter of statutory construction there was no inconsistency of the kind that arose in Newhaven Port & Properties between the provisions of one statute and the provisions of the other. The statutory purpose for which Parliament had authorized the acquisition and use of the land and the operation of section 15 of the 2006 Act were not inherently inconsistent with each other. By contrast with Newhaven Port & Properties, there were no specific statutory purposes or provisions attaching to this particular land. Parliament had not conferred on the county council, as local education authority, powers to use this particular land for specific statutory purposes with which its registration as a town or village green would be incompatible. Surrey 46. As in the Lancaster case, therefore, the circumstances did not correspond to those of Newhaven Port & Properties. The land was not being used for any defined statutory purposes with which registration would be incompatible. No statutory purpose relating specifically to this particular land would be frustrated. The ownership of the land by NHS Property Services, and the existence of statutory powers that could be used for the purposes of developing the land in the future, was not enough to create a statutory incompatibility. The clinical commissioning group would still be able to carry out its statutory functions in the provision of hospital and other accommodation and the various services and facilities within the scope of its statutory responsibilities if the public had the right to use the land at Leach Grove Wood for recreational purposes, even if the land itself could not then be put to use for the purposes of any of the relevant statutory functions. None of those general statutory functions were required to be performed on this land. And again, it is possible to go somewhat further than that. Although the registration of the land as a village green would preclude its being developed by the construction of a hospital or an extension to the existing hospital, or as a clinic or administrative building, or as a car park, and even though the relevant legislation did not include a power or duty to provide facilities for recreation, there would be nothing inconsistent either in principle or in practice between the land being registered as a green and its being kept open and undeveloped and maintained as part of the Leatherhead Hospital site, whether or not with access to it by staff, patients or visitors. This would not prevent or interfere with the performance of any of the relevant statutory functions. But in any event, as in the Lancaster case, the two statutory regimes were not inherently in conflict with each other. There was no statutory incompatibility. Was the Lancashire land held for educational purposes? Before we turn to the main issue it is convenient to dispose of a preliminary issue which arises only in respect of the first appeal. For what purposes was the land held? The inspector recorded the evidence on which LCC relied as showing that the land was held for the relevant statutory purposes. 113. LCC has provided Land Registry Official copies of the register of title which show that LCC is the registered proprietor of the Application Land. Areas A, B and E were the subject of a conveyance dated 29 June 1948, a copy of which has been provided. It makes no mention of the purposes for which the land was acquired but is endorsed with the words Recorded in the books of the Ministry of Education under section 87(3) of the Education Act 1944. The endorsement is dated 12 August 1948. 114. Areas C and D were the subject of a conveyance dated 25 August 1961. Again the conveyance makes no mention of the purposes for which the land was acquired but the copy provided has a faint manuscript endorsement as follows Education Lancaster Greaves County Secondary School. 115. In addition LCC provided an instrument dated 23 February 1925 and a letter from LCC to the school dated 1991. The instrument records that the Council of the Borough of Lancaster has applied to the Minister of Health for consent to the appropriation for the purposes of the Education Act 1921 of the land acquired by the council otherwise than in their capacity as Local Education Authority. The land shown on the plan is the [Barton Road Playing Field (land also owned by LCC, to the immediate west of Areas C and D and separated from them by a shallow watercourse, but accessible from them via a stone bridge and also stepping stones)]. An acknowledgement and undertaking dated March 1949 refers to the transfer to the county council of the education functions of the City of Lancaster and lists deeds and documents relating to school premises and other land and premises held by the corporation. It lists the [Barton Road Playing Field]. The 1991 letter encloses a note from Lancashire Education Committee outlining a proposal to declare land surplus to educational requirements. This relates to the land adjacent to Area C which was subsequently developed for housing. As none of this documentation relates directly to the Application Land I do not find it of particular assistance. 116. At the inquiry LCC provided a print out of an electronic document headed Lancashire County Council Property Asset Management Information which in relation to Moorside Primary School records the committee as E. I accept that it is likely that this stands for Education. An LCC plan showing land owned by CYP education shows Areas A, B and E as Moorside Primary School and Areas C and D as Replacement School Site. In relation to Areas C and D the terrier was produced, and under committee is the word education. The whole page has a line drawn through it, the reason for which is unexplained. 117. LCC submits that the documentation provides clear evidence that the Application Land is held for educational purposes and that no further proof is necessary. However, no council resolution authorising the purchase of the land for educational purposes or appropriating the land to educational purposes has been provided. The conveyances themselves do not show for what purpose the council acquired the land, and although the endorsements on those documents make reference to education, the authority for them is unknown. Lynn MacDonald confirmed that the Application Land was identified as land which may need to be brought into education provision, but was unable to express an opinion about the detail of LCCs ownership of the land. 118. The information with regard to the purposes for which the Application Land is held by LCC is unsatisfactory. Although there is no evidence to suggest that it is held other than for educational purposes, it is not possible to be sure that The inspector stated her conclusions: LCCs statement that the Application Land was acquired and is held for educational purposes and was so held throughout the 20 year period relevant to the Application accurately reflects the legal position. In fairness to the inspector, we should note that this issue seems to have been raised rather the late in the day, and was less than fully explored in LCCs submissions before her (see Ouseley J [2016] EWHC 1238 (Admin), para 49, noting Ms Bebbingtons evidence as to what took place at the inquiry; the counsel who have appeared for LCC in the court proceedings did not act for it at the inquiry. Ouseley J indicated that, left to himself, he would have been likely to have reached a different view, at para 57: I rather doubt that, confined to the express reasoning in the DL [the decision letter], I would have reached the same conclusion as the inspector as to what could be inferred from the conveyances and endorsements on them in relation to the purpose of the acquisition of the various areas. I can see no real reason not to conclude, on that basis, that the acquisition was for educational purposes. No other statutory purpose for the acquisition was put forward; there was no suggestion that the parcels were acquired for public open space. I would have inferred that there were resolutions in existence authorising the acquisitions for that contemporaneously evidenced intended purpose, which simply had not been found at this considerable distance in time. It would be highly improbable for the lands to have been purchased without resolutions approving it. The presumption of regularity would warrant the assumption that there had been resolutions to that effect, and that the purpose resolved upon would have been the one endorsed on the conveyances. This is reinforced by the evidence in DL para 116, which shows the property, after acquisition, to be managed by or on behalf of the Education Committee. The actual use made of some of the land is of limited value in relation to the basis of its acquisition or continued holding. However, he was unwilling to conclude that the inspectors decision was irrational, at para 61: As I read the DL, the fundamental problem for the inspector in the LCC evidence was the absence of what she regarded as the primary sources for power under which the acquisition or appropriation of the land occurred: the resolutions to acquire or to appropriate it for educational purposes. She was entitled to regard those as the primary sources to prove the basis for the exercise of the powers of the authority she approached her decision, as I read it, knowing what transpired before her, not on the basis that resolutions related to acquisition might well have existed but could not be found at this distance in time, but on the basis that none had been produced despite proper endeavours to find them, endeavours which had nonetheless produced the conveyances, and other related documents. So she was not prepared to assume that resolutions in relation to acquisition had existed. That was entirely a matter for her, and cannot come close to legal error. The Court of Appeal in substance adopted Ouseley Js reasoning. In this court, Mr Edwards QC for LCC accepts that this issue was one of fact for the inspector. But he submits that her conclusion was unsupportable on the evidence before her, or was vitiated by error of fact (under the principles set out in E v Secretary of State for Home Department [2004] QB 1044). For good measure he submits that the courts below were wrong not to admit evidence, discovered after the inquiry, in the form of council minutes from February 1948 recording the resolution to acquire Areas A and B (and E) for a proposed primary school. He starts from the proposition that the LCC, as a statutory local authority, could only acquire land for the purposes of any of their [statutory] functions (see now the Local Government Act 1972, section 120(1)(a)); and that in normal circumstances the land would continue to be held for the purpose for which it was acquired unless validly appropriated for an alternative statutory purpose, when no longer required for the first (section 122). The inspector, he says, gave no weight to that statutory context. As regards Areas A, B and E, he submits, the evidence before the inspector was quite clear (even without the new evidence). The inspector properly noted that the acquisition had been Recorded in the books of the Ministry of Education under section 87(3) of the Education Act 1944. However, she failed to understand or give due weight to the significance of that note. As Mr Edwards explains, the effect of section 87 of the Education Act 1944 (headed Exemption of assurances of property for educational purposes from the Mortmain Acts) was to exempt from the Mortmain and Charitable Uses Act 1888 and related Acts, land transferred (inter alia) to a local education authority, if the land was to be used for educational purposes. (The law of Mortmain dating back to the Statutes of Mortmain in 1279 and 1290, was not finally abolished until 1960.) A copy of the conveyance or other document by which the transfer of such land was made was required, within six months of its taking effect, to be sent to the Education Minister. Section 87(3) provided that a record should be kept of any conveyance sent to the minister pursuant to the section. Accordingly, says Mr Edwards, the reference to the record under section 87(3) should have been treated by the inspector as clear evidence that the original purpose of the acquisition was for educational purposes, even in the absence of a contemporary resolution to that effect. Against that background, the lack of evidence of any competing purpose to which the land might have been appropriated over the subsequent years pointed to the inference that it continued to be held for its original purpose. As regards Areas C and D, Mr Edwards submits, the indication on the 1961 conveyance of an educational purpose, taken with the references in later documents to its being treated as educational land, and the lack of any evidence of a competing purpose, were sufficient to support the inference, on the balance of probabilities, that education was the purpose for which it had been acquired and subsequently held. Discussion Although Mr Edwards has accepted that this issue was one of fact for the inspector, that concession needs to be seen in context. The inspectors assessment was one depending, not so much on evaluation of oral evidence, but largely on the inferences to be drawn from legal or official documents of varying degrees of formality. In our view, Ouseley Js approach to the natural inferences to be drawn from the material before the inspector was correct, but he was wrong to be deflected by deference to the inspectors fact finding role. The main difference between them was in the weight given by the inspector to the absence of specific resolutions, from which she found it not possible to be sure that the land had been acquired and held for educational purposes. On its face the language appears to raise the threshold of proof above the ordinary civil test to which she had properly referred earlier in the decision. But even discounting that point, she was wrong in our view to place such emphasis on the lack of such resolutions. Her task was to take the evidence before her as it stood, and determine, on the balance of probabilities, for what purpose the land was held. On that approach, Ouseley Js own assessment ([2016] EWHC 1238 (Admin)) was in our view impeccable. The inspectors assessment was irrational, having regard to the relevant standard of proof and the evidence available. There was no evidence to support any inference other than that each part of the land had been acquired for, and continued during the relevant period to be held for, statutory educational purposes. An assessment made without any supporting evidence cannot stand: Edwards v Bairstow [1956] AC 14, 29. In respect of Areas A and B, furthermore, there was a clear error of law, in the inspectors failure to appreciate, or take account of, the significance of the reference to section 87(3) of the 1944 Act. This may be because she was given little assistance on the point by LCC at the inquiry. It is less clear why the point, having been clearly raised in submissions in the court proceedings (see Ouseley J, para 44), seems to have been ignored in the subsequent judgments. On any view, that reference, and the inferences to be drawn from it, went beyond a pure issue of fact, and were appropriate for review by the court. In agreement with Mr Edwards we would regard it as providing unequivocal support for the conclusion that the land comprising Areas A and B was acquired for educational purposes. There was no evidence to suggest that it had ever been appropriated to other purposes. In respect of Areas C and D, the evidence is less clear cut, but we agree with Mr Edwards submission that it is sufficient, on the balance of probabilities, to support the same conclusion and that, in the absence of any evidence to support any other view, it was irrational for the inspector to reach a different conclusion. Again, we think that Ouseley Js assessment of the facts was the correct one. In these circumstances it is unnecessary to consider whether Ouseley J erred in refusing to admit the new evidence. We note, however, that it does no more than support what was already a strong case in respect of Areas A and B; it does nothing to enhance the case for Areas C and D. Implied permission We can also deal more briefly with an issue that arises only in respect of the Surrey site: that is Mr Laurence QCs application for permission to argue (for the first time) that the publics use of the land for recreation should be treated as having implied permission from NHS Property Services or its predecessors, thus showing that the use was by right rather than as of right. This, as he accepts, is a departure from Sunningwell [2000] 1 AC 335, where it was held that mere toleration by a landowner of the publics use could not be taken as evidence that the landowner had impliedly consented to that use. He seeks to distinguish the position of land that is held for public purposes such as by his client. We quote his printed case: there is a critical distinction between (i) a private owner (such as the kindly rector in Sunningwell) tolerating use of land not held for public purposes which can provide no evidence of an implied permission and (ii) a public owner passively responding to recreational use in a statutory context which justifies the inference that that response to the publics use of the land is evidence of an implicit permission so long as the permitted use does not disrupt the public authoritys use of the land for its statutory purposes. In such a case it is irrelevant that in a non statutory, private context such a response might be characterised as toleration. He also relies on section 120(2) of the Local Government Act 1972, which authorises land acquired by agreement by a local authority for a particular purpose to be used, pending its requirement for that purpose, for any of the authoritys functions, which, he submits, would include recreational use. It can be inferred, accordingly, that any use by the public was permitted under that power, and as such was pursuant to the same kind of public law right, derived from statute, as was held in R (Barkas) v North Yorkshire County Council [2014] UKSC 31; [2015] AC 195 (Barkas) and Newhaven [2015] AC 1547 to give rise to implied permission. This submission seems to us to face two major difficulties. The first is that no such claim was made before the inspector. As he recorded: 174(f) No issue arises on as of right. There were no vitiating features in play which would preclude use as of right and the application land was at no time held by SCC [Surrey County Council] or by any of the various NHS bodies mentioned herein for purposes which conferred an entitlement on members of the public to use the land for informal recreation. For instance, there was no evidence of any overt act or acts on the part of the objector, or its predecessor, to demonstrate that, before January 2013, the landowner was granting an implied permission for local inhabitants to use the wood. In answer to this, Mr Laurence asserts that the issue is one of law rather than fact. Even if that were so, it would in our view be unfair to all those who took part in the five day inquiry in 2015 to allow the point to be taken for the first time four years later in this court. However, his main difficulty is that the submission is contradicted by clear authority. In R (Beresford) v City of Sunderland [2003] UKHL 60; [2004] 1 AC 889 Lord Walker had accepted the emphasis placed by Mr Laurence himself (appearing on that occasion for the supporters of registration) on the need for the landowner to do something (para 78); passive acquiescence could not be treated as having the same effect as permission communicated (whether in writing, by spoken words, or by overt and unequivocal conduct) (para 79). Later in the judgment (para 83) Lord Walker accepted that permission might be implied by (or inferred from) overt conduct of the landowner, such as making a charge for admission, or asserting his title by the occasional closure of the land to all comers, but he found no evidence in that case of overt acts (on the part of the city council or its predecessors) justifying the inference of an implied licence. Nothing in Barkas or Newhaven undermines the principle that passive acquiescence is insufficient. Mr Laurences then submission that the land owner must do something remains good law, even if there has been some qualification of the form of communication required to the public. The existence in each case of an overt act of the owner was emphasised in the majority judgment in Newhaven [2015] AC 1547, para 71: In this case, as in Barkas, the legal position, binding on both landowner and users of the land, was that there was a public law right, derived from statute, for the public to go onto the land and to use it for recreational purposes, and therefore, in this case, as in Barkas, the recreational use of the land in question by inhabitants of the locality was by right and not as of right. The fact that the right arose from an act of the landowner (in Barkas, acquiring the land and then electing to obtain ministerial consent to put it to recreational use; in this case, to make the Byelaws which implicitly permit recreational use) does not alter the fact that the ultimate right of the public is a public law right derived from statute (the Housing Act 1936 in Barkas; the 1847 Clauses Act and the 1878 Newhaven Act in this case). The law remains, as submitted by Mr Laurence in Beresford, that passive acquiescence, even by a statutory authority with power to permit recreational use, is not enough. Accordingly we would refuse permission for this additional ground of appeal. Statutory incompatibility We turn next to the central issue in the case, based on the Newhaven case. The majority judgment In the judgment of the majority (given by Lord Neuberger PSC and Lord Hodge JSC) the decision not to confirm the registration was supported by two separate lines of reasoning: implied permission and statutory incompatibility. Although the latter was unnecessary for the decision, it was clearly identified as a separate ground of decision (para 74). Lord Carnwath was alone in basing his decision on the implied permission issue alone (para 137), seeing considerable force in the contrary reasoning on the latter issue of Richards LJ in the Court of Appeal ([2014] QB 186). No one has argued that we should regard the majoritys reasoning on this issue as other than binding. Accordingly our decision in the present case depends to a large extent on the correct analysis of that reasoning, and its application to the facts of the two cases before us. The operation of Newhaven Harbour had been subject to legislation since at least 1731. At the relevant time the governing statutes included (inter alia) the Newhaven Harbour and Ouse Lower Navigation Act 1847, section 49 of which required the trustees to maintain and support the said harbour of Newhaven, and the piers, groynes, sluices, wharfs, mooring berths, and other works connected therewith and section 33 of the Harbours, Docks and Piers Clauses Act 1847, which provided that, subject to payment of rates the harbour, dock and pier shall be open to all persons for the shipping and unshipping of goods, and the embarking and landing of passengers. The land owned by the harbour company (NPP) included an area known as West Beach, described in the judgment as part of the operational land of the Harbour (para 8), although not currently used for any harbour purpose. As the judgment explained, at para 9: The Beach owes its origin to the fact that, in 1883, pursuant to the powers granted by the 1863 Newhaven Act, the substantial breakwater was constructed to form the western boundary of the Harbour. The breakwater extends just over 700 metres out to sea. After the construction of the breakwater, accretion of sand occurred along the eastern side of the breakwater, and that accretion has resulted in the Beach. Following an application by the Newhaven Town Council to register the Beach as a town or village green, and the holding of a public inquiry, it was found by the inspector that the beach had been used by residents of the locality for well over 80 years (save during the war periods) for recreation. On that basis the registration authority resolved to register the land. That decision was subject to an application for judicial review, which succeeded before Ouseley J, but was dismissed by the Court of Appeal. Their decision was in turn reversed by the Supreme Court. The judgment of this court in Newhaven In the part of their judgment directed to the statutory incompatibility issue, Lord Neuberger and Lord Hodge referred to case law on public rights of way, easements and servitudes by way of analogy, adopting a cautious approach (paras 76 90). Nonetheless, they found it did provide guidance. In English law, public rights of way are created by dedication by the owner of the land, and the legal capacity of the landowner to dedicate land for that purpose is a relevant consideration (para 78, referring in particular to British Transport Commission v Westmorland County Council [1958] AC 126; see also para 87). Similarly, in the English law of private easements, the capacity of the owner of the potential servient tenement to grant an easement is relevant to prescriptive acquisition, which is based on the fiction of a grant by that owner (para 79). The law of Scotland with respect of creation of public rights of way and private servitudes had also developed on the footing that the statutory capacity of a public authority landowner to allow the creation of such rights was a relevant matter. In particular, in Magistrates of Edinburgh v North British Railway Co (1904) 6 F 620 it was held that it was not possible that a public right of way which it would be ultra vires to grant can be lawfully acquired by user ([2015] AC 1547, paras 83 84); and in Ellices Trustees v Comrs of the Caledonian Canal (1904) 6 F 325 it was held that the commissioners of the canal did not have the power to grant a right of way which was not compatible with the exercise of their statutory duties, and that this also meant that no private right of way or servitude could arise by virtue of user of the land over many years by those claiming such a right of way (paras 85 86). Although the Scots law of prescription had been reformed by statute, Lord Neuberger and Lord Hodge still regarded the historic position as instructive. Their discussion of English law and Scots law in respect of dedication and prescription at paras 76 90 is significant for present purposes, because the reasoning in the cases in those areas regarding statutory incompatibility is general, and is not dependent on the narrower rule of statutory construction that a general provision does not derogate from a special one (generalia specialibus non derogant), to which they also later referred by way of analogy. There follows the critical part of the majority judgment, under the heading Statutory incompatibility: statutory construction, the material parts of which we should quote in full, at paras 91 96: 91. As we have said, the rules of prescriptive acquisition apply only by analogy because Parliament in legislating for the registration of town and village greens has chosen similar wording (indulging as of right in lawful sports and pastimes) in the 1965 and 2006 Acts. It is, none the less, significant in our view that historically in both English law and Scots law, albeit for different reasons, the passage of time would not give rise to prescriptive acquisition against a public authority, which had acquired land for specified statutory purposes and continued to carry out those purposes, where the user founded on would be incompatible with those purposes. That approach is also consistent with the Irish case, McEvoy v Great Northern Railway Co [1900] 2 IR 325, (Palles CB at pp 334 336), which proceeded on the basis that the acquisition of an easement by prescription did not require a presumption of grant but that the incapacity of the owner of the servient tenement to grant excluded prescription. 92. In this case if the statutory incompatibility rested only on the incapacity of the statutory body to grant an easement or dedicate land as a public right of way, the Court of Appeal would have been correct to reject the argument based upon incompatibility because the 2006 Act does not require a grant or dedication by the landowner. But in our view the matter does not rest solely on the vires of the statutory body but rather on the incompatibility of the statutory purpose for which Parliament has authorised the acquisition and use of the land with the operation of section 15 of the 2006 Act. 93. The question of incompatibility is one of statutory construction. It does not depend on the legal theory that underpins the rules of acquisitive prescription. The question is: does section 15 of the 2006 Act apply to land which has been acquired by a statutory undertaker (whether by voluntary agreement or by powers of compulsory purchase) and which is held for statutory purposes that are inconsistent with its registration as a town or village green? In our view it does not. Where Parliament has conferred on a statutory undertaker powers to acquire land compulsorily and to hold and use that land for defined statutory purposes, the 2006 Act does not enable the public to acquire by user rights which are incompatible with the continuing use of the land for those statutory purposes. Where there is a conflict between two statutory regimes, some assistance may be obtained from the rule that a general provision does not derogate from a special one (generalia specialibus non derogant), which is set out in section 88 of the code in Bennion, Statutory Interpretation, 6th ed (2013), p 281: Where the literal meaning of a general enactment covers a situation for which specific provision is made by another enactment contained in an earlier Act, it is presumed that the situation was intended to continue to be dealt with by the specific provision rather than the later general one. Accordingly the earlier specific provision is not treated as impliedly repealed. While there is no question of repeal in the current context, the existence of a lex specialis is relevant to the interpretation of a generally worded statute such as the 2006 Act. 94. There is an incompatibility between the 2006 Act and the statutory regime which confers harbour powers on NPP to operate a working harbour, which is to be open to the public for the shipping of goods etc on payment of rates: section 33 of the 1847 Clauses Act. NPP is obliged to maintain and support the Harbour and its connected works (section 49 of the 1847 Newhaven Act), and it has powers to that end to carry out works on the Harbour including the dredging of the sea bed and the foreshore: section 57 of the 1878 Newhaven Act, and articles 10 and 11 of the 1991 Newhaven Order. 95. The registration of the Beach as a town or village green would make it a criminal offence to damage the green or interrupt its use and enjoyment as a place for exercise and recreation section 12 of the Inclosure Act 1857 or to encroach on or interfere with the green section 29 of the Commons Act 1876 See the Oxfordshire case [2006] 2 AC 674, per Lord Hoffmann, at para 56. 96. In this case, which concerns a working harbour, it is not necessary for the parties to lead evidence as to NPPs plans for the future of the Harbour in order to ascertain whether there is an incompatibility between the registration of the Beach as a town or village green and the use of the Harbour for the statutory purposes to which we have referred. Such registration would clearly impede the use of the adjoining quay to moor vessels. It would prevent the Harbour authority from dredging the Harbour in a way which affected the enjoyment of the Beach. It might also restrict NPPs ability to alter the existing breakwater. All this is apparent without the leading of further evidence. We discuss this reasoning in detail below. Finally in this part of the majority judgment reference is made to cases in which registration of land held by public bodies had been approved by the court: New Windsor, the Trap Grounds case and Lewis [2010] 2 AC 70. The treatment of these cases by Lord Neuberger and Lord Hodge is also significant for present purposes. As regards New Windsor, they emphasised that the land was not acquired and held for a specific statutory purpose, so [n]o question of statutory incompatibility arose (para 98). They observed that in the Trap Grounds case, though the land was wanted for use as an access road and housing development there was no suggestion that [the city council] had acquired and held the land for specific statutory purposes that might give rise to a statutory incompatibility (para 99). With respect to Lewis they pointed out that [it] was not asserted that the council had acquired and held the land for a specific statutory purpose which would be likely to be impeded if the land were to be registered as a town or village green; hence [a]gain, there was no question of any statutory incompatibility (para 100). In relation to each of these cases, Lord Neuberger and Lord Hodge referred in entirely general terms to the statutory powers under which a local authority might hold land and were at pains to emphasise that the land in question was not in fact held in exercise of any such powers which gave rise to a statutory incompatibility. That was the basis on which they distinguished the cases. It is clearly implicit in this part of their analysis that they considered that land which was acquired and held by a local authority in exercise of general statutory powers which were incompatible with use of that land as a town or village green could not be registered as such. Their discussion concludes, at para 101: In our view, therefore, these cases do not assist the respondents. The ownership of land by a public body, such as a local authority, which has statutory powers that it can apply in future to develop land, is not of itself sufficient to create a statutory incompatibility. By contrast, in the present case the statutory harbour authority throughout the period of public user of the Beach held the Harbour land for the statutory harbour purposes and as part of a working harbour. Incompatibility the case for the appellants For LCC Mr Edwards submits that the decision in Newhaven is of general application to land held by a statutory authority for statutory purposes, whatever the nature of the Act. He points out that the statutory duties or powers in Newhaven were not specific to the beach itself, but rather applied to all of the land acquired and held, from time to time, by NPP and its predecessors for the operation of the Port. NPP had not, within living memory, used the Beach for its statutory harbour purposes. The critical passage in the majority judgment (para 93) refers generally to land which has been acquired by a statutory undertaker (whether by voluntary agreement or by powers of compulsory purchase) and which is held for statutory purposes It is not limited to statutory powers directed to a specific location or undertaking. No one has argued that the principle is limited to statutory undertakers, as opposed to public authorities in general. Nor is there any requirement for the land to be in actual use for statutory purposes at the point of registration; it simply has to be held for such purposes. In Newhaven the Beach had not been used for harbour purposes nor was there any fixed intention to do so at any particular time in the future (see para 96). In the present case, notwithstanding the inspectors findings, there was, he submits, clear incompatibility with LCCs functions in respect of the land. The effect of registration would be that there accrues a right vested in the inhabitants of Scotforth East Ward to use the land for lawful sports and pastimes of a variety of forms, including walking and dog walking. LCC could not restrict their entry onto the land, including Area B which was at the time of the inspectors decision used as a playing field by the school (see Decision Letter, para 10). Given the statutory safeguarding obligations towards primary school pupils, the use of that area for play could not continue. Any use of the land to provide a new or expanded school would be precluded. In substance, the land would be no longer available in any meaningful sense for use in fulfilment of the LCCs statutory duties as local education authority. Mr Laurence makes similar submissions in respect of the Surrey site, supported in that case by the conclusions of Gilbart J [2017] 4 WLR 130. Discussion In our judgment, the appeals should be allowed in both cases. On a true reading of the majority judgment in Newhaven on the statutory incompatibility point, the circumstances in each of these cases are such that there is an incompatibility between the statutory purposes for which the land is held and use of that land as a town or village green. This has the result that the provisions of 2006 Act are, as a matter of the construction of that Act, not applicable in relation to it. The principle stated in the key passage of the majority judgment at para 93 is expressed in general terms. The test as stated is not whether the land has been allocated by statute itself for particular statutory purposes, but whether it has been acquired for such purposes (compulsorily or by agreement) and is for the time being so held. Although the passage refers to land acquired by a statutory undertaker, we agree with Mr Edwards that there is no reason in principle to limit it to statutory undertakers as such, nor has that been argued by the respondents. That view is supported also by the fact that the majority felt it necessary to find particular reasons to distinguish cases such as New Windsor, the Trap Grounds case and Lewis, all of which involved local authorities rather than statutory undertakers. Accordingly, the appellants argue with force that the test is directly applicable to the land acquired and held for their respective statutory functions. The reference in para 93 to the manner in which a statutory undertaker acquired the land is significant. Acquisition of land by a statutory undertaker by voluntary agreement will typically be by the exercise of general powers conferred by statute on such an undertaker, where the land is thereafter held pursuant to such powers rather than under specific statutory provisions framed by reference to the land itself (as happened to be a feature of the provisions which were applicable in Newhaven itself). That is also true of land acquired by exercise of powers of compulsory purchase. In relation to the latter type of case, the majority said in terms that the 2006 Act does not enable the public to acquire by user rights which are incompatible with the continuing use of the land for those statutory purposes (para 93). On our reading of the majority judgment, it is clear that in relation to both types of case Lord Neuberger and Lord Hodge took the view that an incompatibility between general statutory powers under which land is held by a statutory undertaker (or, we would add, a public authority with powers defined by statute) and the use of such land as a town or village green excludes the operation of the 2006 Act. This interpretation of the judgment is reinforced by the analysis it contains of the English and Scottish cases on dedication and prescription in relation to rights of way, easements and servitudes and the guidance derived from those cases (see paras 76 to 91): para 47 above. It is also reinforced by the way in which Lord Neuberger and Lord Hodge distinguished the New Windsor, Trap Grounds and Lewis cases: paras 49 and 50 above. The respondents in these appeals submit that the reasoning of Lord Neuberger and Lord Hodge is more narrowly confined, and depends upon identifying a conflict between a particular regime governing an area of land specified in the statute itself and the general statutory regime in the 2006 Act. In support of this interpretation the respondents point to the highly specific nature of the statutory provisions governing the relevant land in Newhaven and to the reference in para 93 to the rule of statutory construction that a general provision does not derogate from a special one (generalia specialibus non derogant). However, for the reasons we have set out above, this interpretation of the judgment does not stand up to detailed analysis. Lord Neuberger and Lord Hodge stated only that some assistance could be obtained from consideration of that rule of construction, not that it provided a definitive answer on the issue of statutory incompatibility. In other words, they treated it as a helpful analogy for the purposes of seeking guidance to answer the question they posed in para 93, just as they treated the English and Scottish cases on prescriptive acquisition as helpful. The way in which they posed the relevant question in para 93 shows that their reasoning is not limited in the way contended for by the respondents, as does their discussion of the prescriptive acquisition cases and the local authority cases of New Windsor, Trap Grounds and Lewis. We do not find the construction of the 2006 Act as identified by the wider reasoning of the majority in Newhaven surprising. It would be a strong thing to find that Parliament intended to allow use of land held by a public authority for good public purposes defined in statute to be stymied by the operation of a subsequent general statute such as the 2006 Act. There is no indication in that Act, or its predecessor, that it was intended to have such an effect. Lord Hoffmann in Sunningwell concluded that it could be inferred that Parliament intended to allow for the creation of new rights pursuant to the 1965 Act by reason of the public interest in the preservation of open spaces which had for many years been used for recreational purposes, but in doing so he recognised that [a] balance must be struck between rights attaching to private property and competing public interests of this character (p 359B E). It is natural to expect that where a public authority is holding land for public purposes defined by statute which are incompatible with the public interest identified by implication from the 1965 Act, and now the 2006 Act, that balance will be affected. The proper inference as to Parliaments intention is that the general public interest identified by Lord Hoffmann will in such a case be outweighed by the specific public interest which finds expression in the particular statutory powers under which the land is held. As Lord Neuberger and Lord Hodge appreciated, this general point can be made with particular force in relation to land purchased using compulsory purchase powers set out in statute. Such powers are generally only created for use in circumstances where an especially strong public interest is engaged, such as could justify the compulsory acquisition of property belonging to others. It seems highly unlikely that Parliament intended that public interests of such a compelling nature could be defeated by the operation of the general provisions in the 2006 Act. In construing the 2006 Act it is also significant that it contains no provision pursuant to which a public authority can buy out rights of user of a town or village green arising under that Act in relation to land which it itself owns. That is so however strong the public interest may now be that it should use the land for public purposes. Since in such a case the public authority already owns the land, it cannot use any power of compulsory purchase to eradicate inconsistent rights and give effect to the public interest, as would be possible if the land was owned by a third party. Although section 16 of the 2006 Act makes specific provision for deregistration of a green on application to the appropriate national authority, in relation to land which is more than 200 square metres in area the application must include a proposal to provide suitable replacement land: subsections (2), (3) and (5). This procedure is available to any owner of registered land, public or private; it is not designed to give effect to the public interest reflected in specific statutory provisions under which the land is held. Often it will be impossible in practice for a public authority to make a proposal to provide replacement land as required to bring section 16 into operation. Again, it would be surprising if Parliament had intended to create the possibility that the 2006 Act should in this way be capable of frustrating important public interests expressed in the statutory powers under which land is held by a public authority, when nothing was said about that in the 2006 Act. In our view, applying section 15 of the 2006 Act as interpreted in the majority judgment in Newhaven, LCC and NHS Property Services can show that there is statutory incompatibility in each of their respective cases. As regards the land held by LCC pursuant to statutory powers for use for education purposes, two points may be made. First, so far as concerns the use of Area B as a school playing field, that use engages the statutory duties of LCC in relation to safeguarding children on land used for education purposes. LCC has to ensure that children can play safely, protected from strangers and from risks to health from dog mess. The rights claimed pursuant to the registration of the land as a town or village green are incompatible with the statutory regime under which such use of Area B takes place. Secondly, however, and more generally, such rights are incompatible with the use of any of Areas A, B, C or D for education purposes, including for example construction of new school buildings or playing fields. It is not necessary for LCC to show that they are currently being used for such purposes, only that they are held for such statutory purposes (see Newhaven, para 96). The 2006 Act was not intended to foreclose future use of the land for education purposes to which it is already dedicated as a matter of law. Similar points apply in the Surrey case. Although the non statutory inspector found against the appellant on the statutory incompatibility issue, the registration authority failed to consider it. Gilbart J was satisfied that, within the statutory regime applicable in that case, there was no feasible use for health related purposes, and indeed none had been suggested. The Court of Appeal took a different view, but largely, as we understand it, on the basis that recreational use of the subject land would not inhibit the ability of NHS Property Services to carry out their functions on other land. We consider that Gilbart J was correct in his assessment on this point. The issue of incompatibility has to be decided by reference to the statutory regime which is applicable and the statutory purposes for which the land is held, not by reference to how the land happens to be being used at any particular point in time (again, see Newhaven, para 96). As Lady Arden and Lord Wilson take a different view regarding the effect of the majority judgment in Newhaven, we should briefly explain why, with respect, we are not persuaded by their judgments. We are all in agreement that the outcome of these appeals turns upon the proper interpretation of the majority judgment in Newhaven. We cannot accept their interpretation of that judgment. In our view, although the case might have been decided on narrower grounds, Lord Neuberger and Lord Hodge deliberately posed the relevant question in para 93 in wide terms, specifically in order to state the issue as one of statutory incompatibility as a matter of principle, having regard to the proper interpretation of the relevant statute pursuant to which the land in question is held. That is why the heading for the relevant section of their judgment is Statutory incompatibility: statutory construction. They say in terms in para 93, The question of incompatibility is one of statutory construction. Nowhere do they say it is a matter of statutory construction and an evaluation of the facts regarding the use to which the land has been put. According to their judgment, the issue of incompatibility is to be determined as a matter of principle, by comparing the statutory purpose for which the land is held with the rights claimed pursuant to the 2006 Act, not by having regard to the actual use to which the authority had put the land thus far or is proposing to put it in future. We consider that this emerges from the critical para 93, and also from the paragraphs which follow in their judgment. Thus, in para 94 they identify the relevant incompatibility as that between the 2006 Act and the statutory regime which confers harbour powers on NPP to operate a working harbour. In para 96, it is to that statutory incompatibility that they refer, not to incompatibility with any use to which NPP had as yet put the land in question or might in fact put it in the foreseeable future. As a matter of fact, the Beach had not been used for the applicable statutory purposes. Further, in our opinion, by stating in para 96 that it was not necessary for the parties to lead evidence as to NPPs plans for the future of the harbour in order to ascertain whether there is an incompatibility between the registration of the Beach as a town or village green and the use of the Harbour for the statutory purposes to which we have referred, Lord Neuberger and Lord Hodge were seeking to emphasise, contrary to Lady Ardens and Lord Wilsons interpretation of their judgment, that what matters for statutory incompatibility to exist so as to prevent the application of the 2006 Act is a comparison with the relevant statutory powers under which the land is held, not any factual assessment of how the public authority might in fact be using or proposing to use the land. The same point can be made about para 97, where Lord Neuberger and Lord Hodge said that it was unnecessary to consider evidence about actual proposed use of the land on the facts, since they were able to determine by looking at the statutory powers that there is a clear incompatibility between NPPs statutory functions in relation to the Harbour, which it continues to operate as a working harbour [ie to hold under the statutory powers referred to in para 94], and the registration of the Beach as a town or village green. Their discussion at paras 98 to 100 of New Windsor, the Trap Grounds case and Lewis supports the same conclusion. In each of those cases the relevant land had been held for a very long period without actually being put to use which was inconsistent on the facts with use as a town or village green and without any proposal that it should be put to such use. The implication from what Lord Neuberger and Lord Hodge say about them is that if it had been shown that the land was held for specific statutory purposes which were incompatible with registration under the 2006 Act, that would have constituted statutory incompatibility which would have prevented registration. Their treatment of these cases cannot be reconciled with Lady Ardens and Lord Wilsons proposed interpretation of their judgment. We do not think that para 101 can be reconciled with that proposed interpretation either. In that paragraph Lord Neuberger and Lord Hodge contrast a case in which a public body might have statutory purposes to which it could in future appropriate the land (but has not yet done so) with the situation in Newhaven itself, where in the relevant period NPP held the Beach for the statutory harbour purposes and as part of a working harbour (ie under the statutory regime referred to in para 94). In our view they were there emphasising that what matters for a statutory incompatibility defence to arise is that the land in question should be held pursuant to statutory powers which are incompatible with registration as a town or village green. Nor, with respect, do we think that Lady Arden and Lord Wilson have offered any good answer to the points we have made at paras 61 to 64 above. We also consider that the reading of Newhaven proposed by Lady Arden and Lord Wilson would undermine the very clear test which Lord Neuberger and Lord Hodge plainly intended to state. Instead of focusing on the question of the incompatibility of the statutory powers under which the relevant land is held, Lady Arden and Lord Wilson would introduce an additional factual inquiry into the actual use to which the authority is putting the land or proposes to put the land in the foreseeable future. Thus, Lady Arden and Lord Wilson would adopt from the English case of Westmorland [1958] AC 126 a test of what use could reasonably be foreseen for the land in question, even though Lord Neuberger and Lord Hodge say nothing to support that in the relevant part of their judgment. They refer to both English and Scottish cases on prescriptive acquisition as being relevant to their assessment of the correct approach to be adopted in interpreting the 2006 Act, and in each case only by way of broad analogy, as they explain at para 91. The Scottish cases they cite do not employ any such test as in the Westmorland case and are consistent with the clear principled test, based on statutory construction, which we understand Lord Neuberger and Lord Hodge to have laid down. Future use Finally, for completeness, we should mention briefly an issue which does not strictly arise within the scope of the appeals, but has been the subject of some discussion. That is the question whether, notwithstanding registration, there might be scope for use by the appellants of the land for their statutory purposes. This arises from a suggestion put forward in Lord Carnwaths minority judgment in Newhaven. He noted that in the Trap Grounds case it had not been necessary to consider the potential conflict between the general village green statutes and more specific statutory regimes, such as under the Harbours Acts. He said, at para 139: It is at least arguable in my view that registration should be confirmed if the necessary use is established, but with the consequence that the 19th century restrictions are imported subject only to the more specific statutory powers governing the operation of the harbour. Mr Edwards, supported by Mr Laurence, seeks to build on that tentative suggestion, taken with the principle of equivalence adopted in the Lewis case [2010] 2 AC 70. As he submits, the Supreme Court accepted that there should be equivalence between the use of the land for lawful sports and pastimes in the qualifying period (in that case subject to concurrent use as a golf course) and the extent of rights vested in local inhabitants after registration. That approach was taken a stage further by the Court of Appeal in TW Logistics Ltd v Essex County Council [2019] Ch 243, holding that the 19th century statutes, as applied to a registered modern green, are not to be construed as interfering with the rights of the landowner to continue pre existing uses so far as not inconsistent with the uses which led to registration (per Lewison LJ, paras 63 82). This is not a suitable occasion to examine the scope of the principle of equivalence, so far as it can be relied on to protect existing uses by the landowner. Lewis was a somewhat special case. Lord Brown was able to draw on [his] own experience both as a golfer and a walker for over six decades (para 106) to attest to the feasibility of an approach based on give and take in that particular context. The same approach may not be so easy to apply in other contexts, and as applied to other forms of competing use. Permission has been granted for an appeal to this court in TW Logistics. That may, if the appeal proceeds, provide an opportunity for further consideration of this difficult issue. In any event, those cases were concerned with actual uses by the owners, not with potential uses for statutory purposes for which the land is held, as in the present cases. In view of our conclusion that the land in each appeal should not have been found to be capable of being registered under the Act, the issue of what uses might have been open to a statutory owner if it were so registered does not arise, and we prefer to say no more about it on this occasion. Conclusion For these reasons we would allow the appeals in both cases. LADY ARDEN: (partly dissenting) Identifying the difference of view My views differ from those of Lord Carnwath and Lord Sales on these appeals in an important respect. My conclusion is that the question of incompatibility between two sets of statutory provisions (on this appeal, the provisions of the Commons Act 2006 (the 2006 Act) and the statute authorising the holding of land by the public authority in question) involves an assessment of the facts as well as a proposition of law. The fact that a public authority holds land for statutory purposes which are incompatible with the use of the land as a town or village green (TVG), is not of itself sufficient to make the land incapable of being registered under the 2006 Act as a TVG. It must be shown that the land is in fact also being used pursuant to those powers, or that it is reasonably foreseeable that it will be used pursuant to those powers, in a manner inconsistent with the publics rights on registration as a TVG. That requirement in my judgment follows from R (Newhaven Port & Properties Ltd) v East Sussex County Council [2015] AC 1547. References in this judgment to public authorities exclude public authorities which are subject to a statutory duty to carry out a particular function on specified land, identified by statute, where such land is sought to be registered as a TVG. Such authorities are outside the scope of this judgment. Identifying the correct approach to questions of statutory inconsistency As a matter of constitutional principle, courts must approach the statute book on the basis that it forms a coherent whole. That means that, when interpreting legislation, courts must, in the absence of an indication of some other intention by Parliament, strive to ensure that the provisions work together and apply so far as possible to their fullest extent, such extent being judged according to the intention of Parliament demonstrated principally in the words used. (We have not been shown any other admissible evidence as to Parliaments intention, such as ministerial statements in Hansard.) The courts cannot simply decline to enforce parts of a statute because there may be a conflict with some other statute. It has to be shown that the part sought to be disapplied is irreconcilable with another part of it. If the two can stand together there is no statutory irreconcilability or inconsistency: compare, for example, The Tabernacle Permanent Building Society v Knight [1892] AC 298. One statute cannot be said to be incompatible with another if the two statutes can properly be read together. So, the test is: can the two statutes in question properly be interpreted so that they stand together and each has the fullest operation in the sense given above? In Newhaven, as I shall demonstrate by reference to the majority judgment in that case in the next section of this judgment, the point was that there was a risk that the statutory undertakings working harbour would be stymied in its operations if the Beach was held to be a TVG. It was not a case where a statutory authority has acquired land for a statutory purpose but, at the time of the proposed registration as a TVG, it is not likely that the land will be used for that purpose in the reasonably foreseeable future. Newhaven and the limits of this Courts decision in that case The judgments in Newhaven in my judgment should be approached on the basis that they are consistent with the principles explained in para 78 above, even though the members of this Court in that case did not articulate them. This court should read their decision, if this can properly be done as a matter of statutory interpretation, as leading to the result that where public authority ownership of land and registration as a TVG can co exist, that course will be available. As a matter again of constitutional principle, land should not be relieved of the burden of an Act of Parliament having (so far as relevant) unqualified application if there is an alternative, properly available interpretation which will lead to the two enactments in question standing together. On timing, the question whether there is any conflict between public authority powers and TVG legislation must be determined as at the date when the application for registration is made. At that point in time, the public authority may be holding land it has acquired under statutory powers for a particular purpose for which it is not yet required. It is not required to apply the land for that purpose and it may decide not to do so and for example to sell the land or use it for some other purpose. Moreover, even while holding the land for a particular purpose, the local authority may be using it for another purpose because it is not required for the statutory purpose for which it is appropriated at that point in time (Local Government Act 1972, section 120(2)). The factual scenario in Newhaven was different: the harbour company was already in operation and the beach was liable to be involved in its then current trading operations. The case shows that incompatibility is not a purely legal matter depending on the existence of statutory powers which if exercised would be inconsistent with use of the land as a TVG. It is necessary on the facts to be satisfied that that is likely to occur after registration. It requires a real world assessment of the situation. The court is not precluded from looking at the facts subsequent to the acquisition of the land any more than the determination as to the reasonableness of a landlords refusal to give a consent under a lease is restricted to the facts known to the parties at the date of the lease (see Ashworth Frazer Ltd v Gloucester City Council [2001] 1 WLR 2180). Interpreting the decision of this Court in Newhaven In the Newhaven case, the harbour company (NPP) had a statutory duty to maintain a harbour. The dispute concerned a tidal beach in one part of the harbour which as it happened was no longer operational. The Beach had been used for the past 80 years or so by members of the locality. The issue with which these appeals are concerned is the issue in that case as to whether the Beach could be registered as a TVG. This court held that the land in issue, namely the Beach, could not be registered as a TVG. In Newhaven, Lord Neuberger and Lord Hodge jointly gave the leading judgment. The other members of the Supreme Court agreed with them. Lord Carnwath also wrote a concurring judgment. On these appeals, Lord Carnwath and Lord Sales examine the leading judgment in detail. They conclude that Lord Neuberger and Lord Hodge held that, where a person applies to register as a TVG land which is held for statutory purposes which would be inconsistent with the land also being TVG, the land is not capable of being so registered, and that the question is purely one of statutory construction. Thus, Lord Neuberger and Lord Hodge formulated the relevant question as, at para 93: does section 15 of the 2006 Act apply to land which has been acquired by a statutory undertaker (whether by voluntary agreement or by powers of compulsory purchase) and which is held for statutory purposes that are inconsistent with its registration as a town or village green? Having stated that question, Lord Neuberger and Lord Hodge immediately answered it by the following sentence: In our view it does not. In that sentence, the word it, as I read it, refers to section 15 itself. The next sentence in the judgment of Lord Neuberger and Lord Hodge states (also at para 93): Where Parliament has conferred on a statutory undertaker powers to acquire land compulsorily and to hold and use that land for defined statutory purposes, the 2006 Act does not enable the public to acquire by user rights which are incompatible with the continuing use of the land for those statutory purposes. That sentence makes it clear that Lord Neuberger and Lord Hodge regarded use as a critical issue. That clearly involves fact. Moreover, the expression continuing use also makes it clear that they regarded the operations of NPP as constituting use which was being perpetuated and that that was so even though the tidal beach which was in issue was in a part of the harbour which was not itself being used. It is further clear from that sentence, in my judgment, that the Supreme Court was not considering the question what would happen if the relevant use had never started or if the relevant land had become surplus to the obligation or power to carry out any particular activity which had been imposed by Parliament. We have not been shown any statutory requirement that a public authority should regularly consider the need for any land and if thought fit dispose of land which is not required for some purpose for which it was acquired, so it may end up holding land for which it has no further need. The local authority could voluntarily appropriate the land to some other purpose but, if it fails to reconsider the use for which it acquired land, or appropriates it to some other use, it is likely that the only basis on which the local authoritys decision or omission to act could be challenged would be on the basis that its decision attained the standard of irrationality, which is a high standard for an applicant to have to meet. Under the judgment of Lord Carnwath and Lord Sales, that land would remain immune from the accrual of rights leading to registration as a TVG even though there would not in fact be any irreconcilability between registration and the statutory power for which the land was conferred. It is not clear what on this basis would happen if the local authority accepts that the original purpose is spent and after the application is made decides to appropriate the land to some other statutory purpose. Furthermore, in Newhaven, para 96, Lord Neuberger and Lord Hodge held: 96. In this case, which concerns a working harbour, it is not necessary for the parties to lead evidence as to NPPs plans for the future of the Harbour in order to ascertain whether there is an incompatibility between the registration of the Beach as a town or village green and the use of the Harbour for the statutory purposes to which we have referred. Such registration would clearly impede the use of the adjoining quay to moor vessels. It would prevent the Harbour authority from dredging the Harbour in a way which affected the enjoyment of the Beach. It might also restrict NPPs ability to alter the existing breakwater. All this is apparent without the leading of further evidence. It follows that they regarded it as important that the harbour in question was a working harbour and that there was a risk of a clash between the registration of the Beach and the use of the harbour for the statutory purposes. They considered that registration would inhibit the use of the adjoining quay to moor vessels. It would prevent the harbour authority from dredging the harbour in a way which affected the enjoyment of the Beach and restrict its ability to alter the existing breakwater. So, I deduce from that paragraph that Lord Neuberger and Lord Hodge also regarded it as important that there was factual evidence establishing the continuing use and the impact of registration on that use. There had to be real, not theoretical, incompatibility. Lord Neuberger and Lord Hodge continue at the end of that paragraph to observe: All this is apparent without the leading of further evidence. The word further confirms that the preceding analysis involved a consideration of the evidence on the ground. In fact the further evidence appears to have been evidence as to plans to upgrade the harbour and use it as a container terminal: see the judgment of Ouseley J in R (Newhaven Port & Properties Ltd) v East Sussex County Council [2012] 3 WLR 709, para 127. In para 97, Lord Neuberger and Lord Hodge continue by summarising further matters on which the harbour company relied, but it was not necessary in the light of the conclusion in para 96 to consider those matters. It is to be noted that in para 97, Lord Neuberger and Lord Hodge refer to an incompatibility between the proposed TVG registration and the statutory functions of NPP, which they add: continues to operate as a working harbour This is an express reference to the state of fact. It would clearly have been material if the harbour company held the land but had ceased its statutory functions. In paras 98 to 101, Lord Neuberger and Lord Hodge refer to previous leading cases to show that the question of statutory incompatibility had not previously had to be considered. But, importantly for my interpretation, they conclude that (at para 100): It was not asserted that the council had acquired and held the land for a specific statutory purpose which would be likely to be impeded if the land were to be registered as a town or village green. So, in a case concerned with future use, the court must consider if the statutory purpose would be likely to be impeded, not likely to be impeded if invoked. Lord Neuberger and Lord Hodge clearly envisaged that there would have to be a factual inquiry as to future use and that it would have to be shown that TVG registration would be likely to impede the exercise of those powers. Lack of impediment can logically be shown either by showing that the local authority has acquired the land for purposes (eg recreational purposes) which are not inconsistent with registration as a TVG, or by showing that there is no realistic likelihood of the land being used for the purposes for which it was acquired. held: In addition, at para 101 of their judgment, Lord Neuberger and Lord Hodge In our view, therefore, these cases do not assist the respondents. The ownership of land by a public body, such as a local authority, which has statutory powers that it can apply in future to develop land, is not of itself sufficient to create a statutory incompatibility. By contrast, in the present case the statutory harbour authority throughout the period of public user of the Beach held the Harbour land for the statutory harbour purposes and as part of a working harbour. In that paragraph, Lord Neuberger and Lord Hodge addressed the question of a future development of the land. The mere power to undertake such development would not itself be sufficient to create a statutory incompatibility. They contrasted that with the position in the Newhaven case. Lord Neuberger and Lord Hodge again referred to the evidence that the tidal beach was part of the working harbour. Paragraph 102 dealt with the separate issue of user as of right and para 103 was the summary of the conclusion, which does not take the matter further. For the avoidance of doubt, I agree that this court should apply statutory incompatibility, the concept sought to be employed in Newhaven, to determine the question of inconsistency between the provisions of the 2006 Act enabling registration of land in issue on these appeals as TVGs and the statutory provisions, also conferred by public general Acts of Parliament, empowering the acquisition and holding of land by the public authorities in both appeals. However, in my judgment, that concept is as a matter of constitutional principle to be interpreted as I have explained in para 78 above. Determination of incompatibility where the issue arises from a future use The use relied on by the local authority in the Lancashire case in relation to Areas A and B is, as in Newhaven, a current use, and my analysis of Newhaven detailed above does not lead to any different conclusion in relation to those Areas from that reached by Lord Carnwath and Lord Sales. I would accept the submission of Mr Douglas Edwards QC, for Lancashire County Council, that in practice the land could not be used by the primary school currently using it when there was unrestricted public access as this would not be consistent with the schools safeguarding obligations: this may be inferred from the fact that the site is currently fenced. Schools are responsible for creating and maintaining a safe environment for their pupils. Mr Edwards submission on this point was not challenged on these appeals. However, as I shall next explain, where the use is only a use which may occur in the future, my analysis makes it necessary to answer further questions before any conclusion about statutory incompatibility can be reached. This has a practical impact in relation to Areas C and D in the Lancashire case. Those Areas have never been used for the statutory purpose of education for which they were acquired and are now held. That raises the question, what test should apply if the case is only one of possible future use? Must it be shown that it is simply possible that the land may be used for the statutory purpose or must it be shown that it is reasonably likely or foreseeable that it will be so used? These questions did not directly arise in Newhaven. In answering these questions, I have found assistance in the decision of the House of Lords in British Transport Commission v Westmorland County Council [1958] AC 126, in which a railway company contended that it would have been inconsistent with the statutory powers conferred on it for the public to have a right of way over a bridge spanning the railway line (originally built for private benefit) and that accordingly its predecessor (another statutory company) could not have dedicated it to the public. In Newhaven, Lord Neuberger and Lord Hodge cited the judgment of Lord Keith of Avonholm in this case as authority for the proposition that incompatibility with an Act of Parliament is a question of fact, at para 87: In British Transport Commission [1958] AC 126, 164 165 Lord Keith of Avonholm commented on Lord Kinnears opinion in Magistrates of Edinburgh, suggesting that it would be going too far to hold that the public could never acquire a right of way over railway property but acknowledging that incompatibility with the conduct of traffic on the railway could bar a public right of passage. He opined at p 166, that incompatibility was a question of fact and that it was for the statutory undertaker to prove incompatibility. The other members of the House also treated it as a question of fact (see Viscount Simonds at p 144, Lord Morton of Henryton at p 149, Lord Radcliffe at p 156, Lord Cohen at p 163 and Lord Keith at p 166). Moreover, they held that, to show compatibility, it was not necessary to show that there were no circumstances in which a conflict could arise. That would make it impossible for members of the public ever to acquire a public right of way over land belonging to the railway company. The House also rejected the argument that a statutory company could not grant an easement over a footpath over its railway. To hold otherwise would be a grave impediment to public amenity (per Lord Radcliffe at p 153). It was unlikely on the facts that the railway company would ever need to pull the bridge down. The relevant question was whether a conflict, or incompatibility, was reasonably foreseeable. Thus, Viscount Simonds (at p 144), Lord Morton (at p 149) and Lord Keith (see p 166) rejected the following test: was it possible that land would be used in future for a certain purpose? They considered that the normal statutory burden should apply and be discharged, namely that it should be shown that the use was reasonably likely to occur. The House considered the question on a current basis and did not decide whether the critical time was the date of dedication or some other date (see for example pp 144 145). At all events it did not seek to determine the question as at the date of the incorporation of the statutory company when its statutory powers were conferred. In my judgment, the test of reasonable foreseeability is the correct test also to apply in this context, ie when asking whether there is incompatibility between registration of land as a TVG and the statutory powers of a public authority in relation to the same land where the relevant use that the public authority might make of the land under those powers is a potential future use which has not yet started. It is said by Lord Carnwath and Lord Sales that this test is not clear. It may not be easy to apply on the facts but that is necessarily so if the law applies a solution which is fact dependent rather than drawing a bright line as the majority does. Lord Neuberger and Lord Hodge refer to the Westmorland case at two points in their judgment. In the light of their conclusion that the evidence as to current use was sufficient it was not necessary for them to consider it in any further detail, but they would not have cited it if they did not approve of its approach. If I am right there is no question of the use of land being stymied by the 2006 Act (cf para 61 above). Circumstances may have moved on and the public authority may no longer require the land it is holding for any particular statutory purpose. Application of the principles to the facts of the appeals (1) The Lancashire appeal The issue of future use of the land arises on the Lancashire appeal in relation to Areas C and D. The local authority in the Lancashire appeal did not adduce evidence that it was reasonably likely that these Areas would be used for educational purposes in the future. There had in the past been a plan to relocate a school on this area but that was not proceeded with and there was no substitute. Moreover, those Areas had never been used for educational purposes. Accordingly, as I see it, those plots should have been registered as a village green. The only objection to doing so was one of statutory incompatibility and as I see it, that fails on the facts. The position is different in relation to Areas A and B which are currently used for educational purposes. Importantly, as I read the facts, the sites cannot be registered as TVGs and be school playgrounds at the same time for the reason that this would be inconsistent with the schools safeguarding duty. The school has an obligation to provide outdoor space as a playground under regulation 10 of the School Premises (England) Regulations 2012, and that is its current use. The inspector did not reach any conclusion on the question of the compatibility in fact of the current use of Areas A and B with their registration as TVGs, and she expressly left open the door to further evidence on incompatibility. (2) The Surrey appeal In the Surrey appeal, the result is different because the site in issue lies immediately next to the hospital. On the basis of my judgment, the correct legal test applying to future use was not applied. There have been no findings of fact as to whether it is reasonably foreseeable that even now the land will be used for the statutory purposes for which it is currently held. In those circumstances, in my judgment, this matter should be remitted to the registration authority for a decision on that issue. Restrictions on TVG registration in the Growth and Infrastructure Act 2013 Lord Carnwath and Lord Sales begin their judgment with an analysis of the development of the law on TVGs since the report of the Royal Commission on Common Land 1955 1958 (1958) (Cmnd 462), chaired by Sir Ivor Jennings QC, which led to the Commons Registration Act 1965. Undoubtedly that Act and its successor, the 2006 Act, have led to the registration of TVGs at a more significant level than can have been envisaged by the Royal Commission. Accordingly, it is now an inescapable fact that the actual use of the TVG legislation has, in the light of practical experience and the needs and expectations of local communities up and down the country, eclipsed the original conception of a more limited role for TVG registration. The clock cannot be turned back. Moreover, Parliament has essentially given its approval to that use in later legislation. The Growth and Infrastructure Act 2013 (the 2013 Act) introduced a package of measures designed to restore the balance between the public and landowners but retaining the same basic system of registration. The three main changes brought about by the 2013 Act in this connection can be summarised, and it will be seen that they were substantial: (1) The period within which a person may apply to register land as a TVG after the landowner has terminated the use by members of the public without permission has been reduced from three years to one year (2006 Act, section 15(3A) as amended). (2) The 2013 Act has inserted a new section 15C into the 2006 Act terminating the publics right to apply to register land as a town or village green after any one of a range of trigger events occurs. These include an application for planning permission. The right to apply for registration as a TVG will arise again if a terminating event occurs, namely (in the case of an application for planning permission) the planning application is withdrawn, is refused or expires, or the local planning authority (LPA) does not determine it. (Where the planning application is for a project of public importance under section 293A of the Town and Country Planning Act 1990, the right to make an application to register as a TVG does not arise where the LPA declines to determine it.) (3) Landowners have a new right to deposit statements with the appropriate registration authority with respect to any land and this will have the effect of terminating any existing or accruing rights to register that land as a TVG (2006 Act, section 15A, as amended). Landowners already had a right to apply to deregister land as a TVG, but comparable land must be offered in exchange (2006 Act, section 16). Lord Carnwath and Lord Sales are right to say that these changes are not directly relevant, and there is no information about any fall in the number of TVG registrations. However, these changes are important. It is open to public authorities to take advantage of these changes (and this is my core answer to the points that Lord Carnwath and Lord Sales make in para 64 above). They show, among other matters, that Parliament did not consider that there should be some special exemption applying in respect of all publicly held land. That may be a recognition of the fact that public bodies may be holding land which is surplus to their statutory requirements. While many statutes confer a power on statutory bodies to acquire and hold land, we have not been shown any provision requiring the body on which the power is conferred to sell it when it becomes clear that the land is not required or is no longer required for the purpose for which it was acquired. If a public authority took no action to dispose of land it did not need, it might well be difficult to obtain judicial review of its action as irrationality may have to be shown. Moreover, Parliament took no steps in the 2013 Act to revise the conditions for registration for TVGs. Judgment of Lord Wilson Since circulating the first draft of my judgment I have had the benefit of reading the judgment of Lord Wilson. He agrees with the approach of the Court of Appeal [2018] 2 P & CR 15. I have great admiration for his judgment and that of Lindblom LJ, with which Jackson and Thirlwall LJJ agreed. In particular, I agree with the three general points made by Lindblom LJ in para 36 of his judgment. In a sense my approach might be described as a halfway house between their judgments and that of Lord Carnwath and Lord Sales. The ten judges who have considered the issues on these appeals have unfortunately been very divided. For my own part, I do not consider that the view of the Court of Appeal addresses the effect on incompatibility of the possibility of future use of the sites sought to be registered as TVGs, or the intention of Parliament in such cases. However, if I am wrong on the approach I have taken, I would adopt that of Lord Wilson and the Court of Appeal in preference to that of Lord Carnwath and Lord Sales. Respectfully, their approach results in introducing into the legislation a blanket exemption for public authorities which Parliament has not itself expressly given. Parliament has instead provided all landowners with other measures which they can use to protect their position for the future. Limiting the issue of incompatibility to a desktop exercise of considering the statutory powers of the landowner, without reference to the facts on the ground, runs the risk, to borrow Lord Radcliffes words in British Transport Commission at p 153, of a grave impediment to public amenity. There will potentially be a loss of access by the public to land which they have used for very many years. Conclusion My approach to statutory incompatibility in my judgment strikes a fairer balance between the public interest in the use of land by the public authority for the appropriated statutory purpose and that of the public who are intended by the 2006 Act to have a right of access to recreational spaces than the approach of Lord Carnwath and Lord Sales. That is my principal answer to the points which they make in paras 61 to 64 and 67 to 71 above and my other responses to those paragraphs appear from this judgment. My judgment does not as suggested in any way involve frustrating the intention of Parliament since the statutory powers under which the public authority holds the land will prevail if it is shown that there is a current use of the land in exercise of those powers, or that it is reasonably foreseeable that such use will occur (se para 77 above). Accordingly, I would hold that the appeal in Lancashire should be allowed in part and that in Surrey the appeal should also be allowed on the basis that the matter remitted to the registration authority for a determination of the application in accordance with this judgment. LORD WILSON: (dissenting) I would have dismissed both appeals. Although I hold each of my three colleagues in the majority in the highest esteem, I am driven to suggest that today they make a substantial inroad into the ostensible reach of a statutory provision with inadequate justification. It is agreed that, in their capacity as education authorities, local authorities, such as the appellant in the Lancashire case, can hold land only for specified statutory purposes referable to education; that health authorities, such as the appellant in the Surrey case, can hold land only for specified statutory purposes referable to health; and that, for example, in their capacity as housing authorities, local authorities can hold land only for specified statutory purposes referable to housing. If public authorities which hold land for specified statutory purposes are to be immune from any registration of it as a green which would be theoretically incompatible with their purposes, the reach of section 15 of the Commons Act 2006 Act is substantially reduced. One would expect that, had such been its intention, Parliament would have so provided within the section. In the absence of any such provision, whence does justification for it come? It comes, according to todays ruling, from the decision of this court in the Newhaven case, cited in para 1 above, from which the court would in any event be able to depart if necessary. In my view interpretation of that decision by todays majority is controversial. The claim in para 11 above that their interpretation represents no more than consolidation of the law is unfortunately not one to which I can subscribe. The decision in the Newhaven case wrought an exception to the availability of registration under section 15. It is always dangerous to interpret an exception too widely lest it becomes in effect the rule and the rule becomes in effect the exception. In the Newhaven case statutes had cast upon the harbour authority, as the owner/operator of the port, specific duties in relation to that particular harbour; and the operational land of that harbour included that particular beach. An Act of 1847 obliged the authority to maintain and support that harbour. An Act of 1878 obliged it to keep that harbour open to all for the shipping and unshipping of goods and the embarking and landing of passengers. Incidental to these obligations were statutory powers, including one in an instrument of 1991 to dredge the foreshore of that harbour. Were it to exercise its power to dredge the area of the foreshore to the east of the breakwater, the authority would destroy the beach. It is therefore no surprise to read within the joint judgment of Lord Neuberger and Lord Hodge emphasis on the statutory duties cast upon the authority in relation to that particular harbour; no surprise that, in the opening paragraph they described the relevant point of principle as the interrelationship of the statutory law relating to village greens and other duties imposed by statute (emphasis supplied); and no surprise that, at the outset of the crucial paragraph (namely para 93, set out in para 48 above), in which they set out their reason for allowing the appeal on the relevant point, they stated: The question of incompatibility is one of statutory construction. What did Lord Neuberger and Lord Hodge mean by statutory construction? They meant conflict between two statutory regimes. They explained in the same paragraph that, where such conflict existed, some assistance may be obtained from the rule that a general provision does not derogate from a special one , which is set out in Bennion, Statutory Interpretation, 6th ed (2013), p 281: Where the literal meaning of a general enactment covers a situation for which specific provision is made by another enactment contained in an earlier Act, it is presumed that the situation was intended to continue to be dealt with by the specific provision rather than the later general one. In the next paragraph they proceeded to explain that the specific duties conferred by statutes on the authority in relation to that harbour were incompatible with the general provision in the 2006 Act which, on the face of it, permitted registration of the beach as a green and that therefore the general provision had to give way. By contrast, statutory provisions which confer power to acquire and hold land, not there identified, for educational and health purposes, such as are in play in the present appeals, cannot be said to be incompatible with the general provision in the 2006 Act which, on the face of it, permits registration of the respective parcels of land as greens. No reason for the disapplication of section 15 of the 2006 Act is advanced other than the alleged effect of the decision in the Newhaven case. It is in the light of the above circumstances that I would have dismissed the appeals. Let me, however, suppose that my understanding of the decision in the Newhaven case is flawed; and that, had I better understood it, its reasoning would extend to the facts in these appeals. Even in those circumstances the majority falls, so I venture to suggest, into error. In The King v The Inhabitants of Leake (1833) 5 B and Ad 469 the issue was whether villagers in the fenlands were obliged to repair a road. If it had been dedicated as a public highway, they were obliged to do so. The land on which the road had been constructed was owned by commissioners who had bought it pursuant to statutory powers to drain specified fens and to keep them drained. They had constructed drains on it and, with the excavated earth, had built a wide bank which the villagers had used as a highway for more than 20 years. In the Court of Kings Bench the villagers contended that any dedication by the commissioners of the road as a public highway would have been inconsistent with their powers. On behalf of the majority Parke J, later Lord Wensleydale, made clear that the contention should be addressed by means of a practical inquiry on the ground. He said at p 480: The question then is reduced to this, whether, upon the finding of the jury in this case, the public use of the bank as a road would interfere with the exercise of these powers? The answer was no. The Leake case demonstrates that for almost 200 years the law of England and Wales in relation to the capacity of a public authority to dedicate its land as a public highway, or indeed as a public footpath, has been to assess its alleged incompatibility with the statutory purposes for which the land is held on a practical, rather than a theoretical, basis. Such is made clear in the Opinions of the appellate committee of the House of Lords in British Transport Commission v Westmorland County Council [1958] AC 126, cited in para 71 above. A railway company was authorised by statute to buy land in Kendal for the purposes of operating a railway and to build bridges across it where necessary. On one of its bridges it built a footpath, which the public had used for more than 20 years. The question was whether, in the light of the limited statutory purposes for which it could hold land, the company could have dedicated the footpath as a public highway. Applying the Leake case, the appellate committee held that the answer was to be found by determining whether the use of the footpath by the public was incompatible with the statutory purposes; that incompatibility was a question of fact (p 143); that the test was pragmatic (p 152); that the question was not whether it was conceivable but whether it was reasonably foreseeable that the public use of the footpath would interfere with the companys use of its land in the exercise of its powers for the statutory purposes (p 144); that the burden lay on the company to establish that it was reasonably foreseeable (p 166); and that, by reference to the case stated by the local justices, the company failed to discharge that burden. In para 78 of their judgment in the Newhaven case Lord Neuberger and Lord Hodge explained the decision in the Westmorland case. In paras 77 and 91 they stressed that, like other decisions which they examined and which related to the acquisition of prescriptive rights under English and Scots law, the decision applied only by analogy to the statutory registration of a green on land owned pursuant to statutory purposes. Nevertheless, in a case in which the objection to registration as a green is cast as incompatibility with statutory purposes, there is in my view every reason to assess incompatibility in accordance with the approach adopted in the Leake case and indorsed in the Westmorland case. I am convinced that in the Newhaven case such was also the view of Lord Neuberger and Lord Hodge, and indeed of Lady Hale and Lord Sumption who agreed with them. I refer to four passages in the joint judgment. First, from para 91: It is significant in our view that historically in both English law and Scots law, albeit for different reasons, the passage of time would not give rise to prescriptive acquisition against a public authority, which had acquired land for specified statutory purposes and continued to carry out those purposes, where the user founded on would be incompatible with those purposes. (Emphasis supplied) Second, from the crucial para 93: Where Parliament has conferred on a statutory undertaker powers to acquire land compulsorily and to hold and use that land for defined statutory purposes, the 2006 Act does not enable the public to acquire by user rights which are incompatible with the continuing use of the land for those statutory purposes. (Emphasis supplied) Third, the whole of para 96: In this case, which concerns a working harbour, it is not necessary for the parties to lead evidence as to [the authoritys] plans for the future of the Harbour in order to ascertain whether there is an incompatibility between the registration of the Beach as a town or village green and the use of the Harbour for the statutory purposes to which we have referred. Such registration would clearly impede the use of the adjoining quay to moor vessels. It would prevent the Harbour authority from dredging the Harbour in a way which affected the enjoyment of the Beach. It might also restrict [the authoritys] ability to alter the existing breakwater. All this is apparent without the leading of further evidence. And fourth, from para 101: The ownership of land by a public body which has statutory powers that it can apply in future to develop land, is not of itself sufficient to create a statutory incompatibility. By contrast, in the present case the statutory harbour authority throughout the period of public user of the Beach held the Harbour land for the statutory harbour purposes and as part of a working harbour. (Emphasis supplied) It thus seems clear from the Newhaven case that registration of the beach as a green was there precluded as incompatible with the existing use of the land as a working harbour; and that, in the absence of existing use of the land, the public authority needs to adduce evidence. What evidence? Evidence which makes it reasonably foreseeable that public use of the land as a green would in practice interfere with a proposed exercise of the authoritys powers in relation to the land for the statutory purposes. It follows that I respectfully disagree with the suggestion in paras 65 and 66 of the judgment of Lord Carnwath and Lord Sales that incompatibility with statutory purposes should be assessed as a theoretical exercise rather than by means of a practical inquiry into interference with the authoritys existing or proposed future use of the land. Adopting what I believe to be the correct, practical, approach to the assessment of incompatibility in relation to the present appeals, I agree with the Court of Appeal that neither the education authority nor the health authority has established that public use of its land as a registered green would be likely to be incompatible with its use of it pursuant to its statutory powers. In the Lancashire case the Inspector conducted the requisite practical assessment, which led her to reject the alleged incompatibility; and, like the Court of Appeal, Ouseley J in the Administrative Court found no fault with her reasoning. I discern no ground upon which this court might have concluded otherwise. In the Surrey case the Inspector, while recommending refusal of the application for a different reason later shown to be invalid, also rejected the alleged incompatibility on apparently practical grounds; and the error of law which Gilbart J in the Administrative Court perceived him to have made in assessing it practically rather than as a matter of statutory construction was in my view correctly held by the Court of Appeal to have been no error at all. It was with complete passivity that, for no less than 20 years, these two public authorities contemplated the recreational use of their land on the part of the public. Their simple erection at some stage during that period of signs permitting (or for that matter prohibiting) public use would have prevented such use of the land being as of right: Winterburn v Bennett [2016] EWCA Civ 482, [2017] 1 WLR 646. In such circumstances it is hardly surprising that they both failed to establish its practical incompatibility with their own proposed use of it.

The issue in the two appeals relates to the circumstances in which statutory incompatibility will defeat an application by a member of the public to register land as a town or village green (a green) under the Commons Act 2006 (the Act) where the land is held by a public authority for statutory purposes. At issue in the first appeal is land, divided into five areas, adjacent to Moorside Primary School in Lancaster and owned by Lancashire County Council (LCC). A local resident applied to register the land as a green based on 20 years qualifying use. LCC objected on the basis that the land was acquired and remains appropriated for education purposes under LCCs statutory powers as education authority. An inspector appointed by the Secretary of State determined that four of the five areas should be registered. She was not satisfied that the land was in fact acquired and held for education purposes and, even if it had been, there was no good statutory incompatibility defence available to LCC. The inspectors determination was upheld by Ouseley J in the High Court on LCCs application for judicial review. The second appeal concerns a site at Leach Grove Wood in Leatherhead owned by NHS Property Services Ltd (the NHS). An application was made to register the site as a green, relying on use over a period of 20 years. An inspector recommended refusal of registration, but the registration authority, Surrey County Council (SCC), did not accept this and registered the land. On the NHSs application for judicial review in the High Court, Gilbart J distinguished the judgment of Ouseley J and quashed the registration on the basis that SCC had failed properly to consider statutory incompatibility. The appeals were heard together by the Court of Appeal, which upheld the decision to register in both cases. LCC and the NHS appealed to the Supreme Court. By a majority, the Supreme Court allows the appeals in both cases. Lord Carnwath and Lord Sales give the majority judgment, with which Lady Black agrees. Lady Arden gives a partly dissenting judgment and Lord Wilson gives a dissenting judgment. The inspectors finding in the Lancaster case that the land was not acquired and held pursuant to statutory education purposes was inconsistent with the evidence and irrational [33] [34]. Therefore the central issue in both the cases under appeal is the interpretation and application of the statutory incompatibility ground of decision identified in the majority judgment in the Supreme Court in R (Newhaven Port & Properties Ltd) v East Sussex County Council [2015] UKSC 7 (Newhaven) [43]. The majoritys opinion is that Newhaven authoritatively interpreted the Act to mean that where land is acquired and held for defined statutory purposes by a public authority, the Act does not enable the public to acquire rights over that land by registering it as a green where such registration would be incompatible with those statutory purposes [48]. Here there is an incompatibility between the statutory purposes for which the land is held and use of that land as a green and therefore the Act is not applicable [55]. The test set out in Newhaven is not whether the land has been allocated by statute for particular purposes, but rather whether it has been acquired by the public authority pursuant to its statutory powers and is held for the purposes of those powers, where those purposes are incompatible with registration of the land as a green [56]. The reference to acquisition by both voluntary sale and compulsory purchase is significant, since acquisition by voluntary sale will typically involve the exercise of general statutory powers rather than specific statutory provisions framed by reference to the land itself [57]. This construction of the Act is unsurprising; there is no indication that the general provisions in the Act regarding registration as a green were intended to have the effect of preventing use of land held by a public authority for specific public purposes defined in statute [61]. This general point can be made with particular force in relation to land held pursuant to the exercise of statutory compulsory purchase powers, since such powers are created for use in circumstances where there is an especially strong public interest that land should be used for particular purposes, such as is capable of justifying compelling a land owner to sell their land against their wishes [63]. Applying the Act as interpreted in Newhaven, LCC and the NHS can show that there is statutory incompatibility in each case. In the Lancaster case, the rights claimed pursuant to the registration of the land as a green are incompatible with the use of the relevant areas for education purposes, including for example use of them as playing fields or for constructing new school buildings. LCC does not need to show they are currently being used for such purposes, only that they are held for such statutory purposes [65]. Similar points apply in the Surrey case: the issue of incompatibility has to be decided by reference to the statutory purposes for which the land is held, not by reference to how the land happens to be used at a particular point in time [66]. Lady Arden disagrees with the reasoning of the majority. She would have allowed the appeals save that she would have dismissed the appeal in relation to two of the areas of the Lancashire site and remitted the matter to the registration authority in the Surrey appeal [122]. In her view, the fact that a public authority holds land for statutory purposes that are incompatible with the use of the land as a green is not of itself sufficient to make the land incapable of being registered. It must be shown that the land is in fact being, or that it is reasonably foreseeable that it will be, used pursuant to those powers in a manner inconsistent with the publics rights on registration as a green [77]. Lord Wilson dissents from the majority and would have dismissed both appeals [123]. The Acts reach is substantially reduced if land held by public authorities for specified statutory purposes is to be immune from registration as a green that could theoretically be incompatible with those purposes [126]. Newhaven was concerned with statutes that conferred specific duties in relation to particular land. Those specific duties were incompatible with the general provision in the Act which therefore had to give way [131]. In contrast, the present cases involve statutory provisions that confer general powers to acquire and hold unspecified land for education and health purposes and these cannot be said to be incompatible with the provision in the Act [132].

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This is a remarkable case in more than one respect. The appeal depends upon whether the Court is bound to stay action 2006 Folio 815 (the 2006 proceedings) under Article 27 of Regulation 44/2001 of the Council of the European Union (the Regulation) and, if not, whether it should do so under Article 28. Before Burton J (the judge), the respondents expressly disclaimed any intention to rely upon Article 27 but relied upon Article 28 in support of a submission that the court should stay the 2006 proceedings in favour of proceedings in Greece. The judge refused to grant a stay and gave summary judgment for the appellants against the respondents. The judge granted the respondents permission to appeal to the Court of Appeal on various grounds, including a ground based on Article 27. The Court of Appeal (Longmore, Toulson and Rimer LJJ) held that it was bound to stay the action under Article 27. It also gave some consideration to Article 28 but held that it was not necessary to reach a final conclusion in that regard because of its decision under Article 27. It declined to consider the issues relevant to summary judgment on the ground that, if there was to be a stay, those issues should be determined by the courts in Greece. The facts and the 2006 proceedings I can take the relevant events from the judgment of Longmore LJ in the Court of Appeal. He in turn took them from the judgment of the judge. On 3 May 2006 the vessel Alexandros T sank and became a total loss 300 miles south of Port Elizabeth, with considerable loss of life. Her owners were Starlight Shipping Company (Starlight). They made a claim against their insurers, who denied liability on the basis that the vessel was unseaworthy with the privity of the assured, namely Starlight. The insurers also said that Starlight had failed properly to report and repair damage to the vessel in accordance with Class Rules. Starlight, through their solicitors Messrs Ince & Co, made a number of serious allegations against the insurers which fell into two categories, as summarised by Longmore LJ at para 4: (1) allegations of misconduct by the insurers and their underwriters involving alleged tampering with and bribing of witnesses, in particular the bosun, a Mr Miranda, to give false evidence, coupled with other allegations of spreading false and malicious rumours (described for some reason as malicious scuttlebutt) against Starlight in the course of purported investigation of their claims; and (2) deliberate failure by the insurers to pay up under the policy, said to have had consequential financial impact upon Starlight, and to have led to substantial recoverable loss and damage. The insurers also relied upon material non disclosure. Those allegations were made before the issue of proceedings and, in particular, in a letter dated 18 July 2006 from Ince & Co to the insurers solicitors, who were Hill Dickinson LLP, then Hill Taylor Dickinson, whom I will together call HD. On 15 August 2006 Starlight issued the 2006 proceedings in the Commercial Court against various insurers. The first four defendants have been described as the Company Market Insurers (CMI) and the fifth to seventh defendants as the Lloyds Market Insurers (LMI). The policies issued by both the CMI and the LMI contained exclusive jurisdiction clauses. They provided for English law and each party expressly agreed to submit to the exclusive jurisdiction of the Courts of England and Wales. Overseas Marine Enterprises Inc (OME) were identified in the policies as managers. In paras 5 to 8 of his judgment Longmore LJ spelled out in some detail issues between the parties in the 2006 proceedings. It is plain that the points raised by Ince & Co to which I have referred were both pleaded and central to the issues between the parties in those proceedings. Thus, in para 7 Longmore LJ referred to a witness statement in which Mr Crampton of Lax & Co, who were now acting for Starlight, asserted that the allegations made by the insurers in defence of the claim were based on false evidence which they had obtained from the bosun. He also relied upon significant payments said to have been made to the bosun on behalf of the insurers in this connection. In addition, a witness statement was introduced in support of a proposed amendment of the claim form alleging that Starlight had sustained losses beyond the measure of indemnity in the relevant policy. It was alleged that, but for the failure of the insurers to pay under the policy, Starlight would have purchased a replacement vessel and had lost between US$ 45 million and US$ 47.7 million by way of increased capital cost and chartering losses. However, on 14 December 2007, Tomlinson J refused to allow the amendment on the basis of the decision of the Court of Appeal in Sprung v Royal Insurance [1999] Lloyds Rep IR 111, approving the decision in The Italia Express (no. 2) [1992] 2 Lloyds Rep 281. As Longmore LJ explained in para 1, as a matter of English law, an insurer commits no breach of contract or duty sounding in damages for failure promptly to pay an insurance claim.1 The law deems interest on sums due under a policy to be adequate compensation for late payment; this is so, even if an insurer deliberately 1 Toulson LJ noted at paras 74 and 75 that the present state of English law was criticised by the Law Commission and the Scottish Law Commission in para 2.87 of a joint consultation paper on Insurance Law; Post Contract Duties (LCCP201/SLCDP152) published on 20 December 2011. The Commissions have provisionally proposed that the law should be reformed. withholds sums which he knows to be due under a policy. If parties agree that English law is to apply to a policy of insurance, this principle is part of what they have agreed. English law, moreover, gives no separate contractual remedy to an insured who complains that an insurer has misconducted himself before settling a claim. In either case the remedy of the insured is to sue the insurer and, if no settlement is forthcoming, proceed to judgment. The trial was fixed for 14 January 2008. The settlements On 13 December 2007, which was the day before the hearing before Tomlinson J referred to above, the 2006 proceedings had been settled between Starlight and OME and the LMI for 100% of the claim, but without interest and costs, in full and final satisfaction of the claim. It was a term of the settlement agreement that Starlight would obtain a stay by way of a Tomlin Order, and a Tomlin Order by consent between Starlight and the LMI was accordingly made on 20 December 2007, backdated to 14 December, in these terms: Save for the purposes of carrying into effect the terms agreed between the Claimant and the Fifth to Seventh Defendants, all further proceedings between the Claimant and the Fifth to Seventh Defendants shall be stayed with effect from 14 December 2007 or such earlier date as may be agreed between the parties or otherwise ordered hereafter. A similar settlement agreement dated 3 January 2008 was made between Starlight and OME and the CMI and a similar Tomlin Order was made on 7 January 2008, but with immediate effect. In each settlement agreement the Assured were defined as being [OME] and Starlight as Managers and/or Owners and/or Associated and/or Affiliated Companies for their respective right and interest in the ship Alexandros T. The CMI settlement agreement then provided: 1. Each Underwriter agrees to pay on or before 18 January 2008 their due proportions of the sum of US$16m being 100% of their due proportions of the sum insured being 50% of the US$32m without interest or costs. 2. The Assured and Claimant agree to accept the EURO equivalent of each Underwriters due proportion of US$16m in full and final settlement of all and any claims it may have under Policy No 302/CF 000220Z against the Underwriters in relation to the loss of Alexandros T, including all claims for interest and costs (including in respect of all costs orders made to date in the proceedings) but without effect to any other insurance policy in which each Underwriter may be involved. 3. The Assured and Claimant agree to Indemnify each Underwriter against any claim that might be brought against it by any of the Assureds or the Claimant's associated companies or organisations or by any mortgagee in relation to the loss of Alexandros T or under Policy No 302/CF000220Z. 4. Following the signing of this agreement, and in consideration of the promises herein, the Claimant and the Underwriters will apply to stay the Proceedings as against the Underwriters, the Proceedings to be stayed for all purposes save for the purposes [of] carrying the terms agreed herein into effect, such stay to have effect from the first obtainable date after 27 December 2007 5. Following the due and proper payment by the Underwriters of the amount specified in paragraph 1 above, the Assured and Claimant and the Underwriters agree to file a consent order dismissing the Proceedings, with no order as to costs. 6. This agreement is subject to English law and to the exclusive jurisdiction of the High Court in London. 2. The underwriters agree to pay on or before 24 December 2007 the sum of US$8M being 100% of their due proportions of the sum insured being 25% of US$32m without interest or costs 3. The Assured and claimant agree to accept the EURO equivalent of US$8M in full and final settlement of all and any claims it may have under Policy No against the Underwriters signing below in relation to the loss of Alexandros T 4. The Assured and Claimant agree to indemnify the underwriters signing below against any claim that might be brought against them by any of the Assureds or the Claimant's associated companies or organisations or by any mortgagee in relation to the loss of Alexandros T or under Policy The LMI settlement agreement provided in similar but not identical terms: 5. This agreement is subject to English law and the jurisdiction of the High Court of London. The Greek proceedings After setting out the terms of the settlement agreements, Longmore LJ wryly observed at the end of para 12 of his judgment that one might have expected that to be that, but it was not to be. He described what then happened in paras 13 to 15. More than three years later, in April 2011, nine sets of Greek proceedings, in materially identical form, (Greece 1), were issued by Starlight, by OME, by their co assureds under an associated Fleet Policy and by individual officers of those companies, against the LMI and the CMI, some of their employees or underwriters, and HD and some of their partners and employees (the HD defendants). The claims are for compensation for loss of hire and loss of opportunity by Starlight totalling approximately US$ 150 million and for pecuniary compensation due to moral damage amounting to 1 million. The claims also include similarly substantial claims by the other claimants in respect of alleged acts, all done unlawfully and in breach of good faith for the alleged purpose of avoiding the performance by the defendants of their legal obligations. All the claims rely upon breaches of the Greek Civil and Criminal Code. However the factual allegations, which Longmore LJ noted had been said by the judge to be entirely familiar, include the allegation that the appellants were responsible for using false affidavits of witnesses (primarily Mr Miranda) with intention to harm the claimants, described thus by Mr Crampton in a statement summarising the Greek claims: The underwriters pursued this criminal effect by intentionally fabricating false evidence with the purpose that the underwriters (who were responsible for the payment of insurance indemnity for the vessel) avoid paying this insurance indemnity, contrary to their contractual obligations and their legal obligations and in particular contrary to the provisions of the insurance contract, providing for the timely payment of the insurance indemnity. They also include the claim that the appellants were asserting and disseminating false information to third parties, although they were aware of their falsity, damaging the claimants reputation and credibility with the purpose that the underwriters (who were responsible for the payments of the insurance indemnity for the vessel) avoid paying the insurance indemnity, contrary to their contractual obligation and their legal obligation and in particular contrary to provisions of the insurance contract providing for the timely payment of the insurance indemnity Mr Crampton then turned to what he called the [i]ntentional fabrication of false evidence for defrauding the English court and [t]he moral instigation alternatively complicity of the underwriters to perjury and on the defrauding of the court by the underwriters. He summarised the position in this way in paragraph 20 of his witness statement: The essence of the complaint against the Defendants in the Greek proceedings concerns the allegation that the Defendants obtained false evidence in Greece from the bosun of the Alexandros T, Aljess Miranda This evidence was then deployed in these proceedings in England and also in the Greek proceedings. There is a substantial section of the Greek pleadings relating to the financial consequences of the failure by the insurers to comply with their obligations under the policy and the way in which they allegedly handled the investigations. In a further set of proceedings, known as Greece 2, two additional heads of loss are claimed by Starlight and OME, arising out of substantially the same allegations. As Longmore LJ put it in para 15, in apparent recognition of the problem raised by the fact that such claims had either not been brought in England or had been ruled out as a matter of English law by Tomlinson J, Mr Crampton, in paragraph 27 of his witness statement, explained that the claims are advanced in two ways in the Greek pleadings: first, that as a result of the underwriters intention to avoid payment of the insurance indemnity, eventually resulting in late payment of the policy proceeds, the claimants missed the opportunity to use the policy proceeds to invest in three vessels (not just the one referred to in the 2006 proceedings); and, secondly, that, as a result of the defendants actions in acquiring the false evidence of Mr Miranda, his clients were not able to insure the vessels and without insurance they would not have been able to trade them and could not purchase them. He stated that his clients would amend their pleadings prior to the hearing of the disputes in Greece so as to clarify this head of claim, such that no claim is made in respect of the late payment of the policy proceeds. The expert evidence from the defendants is that it is not possible to amend the pleadings in the Greek courts, but, treating the proposed draft amendment, which he exhibited, as a clarification, it did not seem to the judge that it in any way cured the defect, if defect there was. It is further said that the insurance of the three potential new vessels was rendered impossible, since all the London insurers refused to quote for the vessels because of the refusal of the defendant underwriters to quote for them and because of the defamatory accusations spread as to the unseaworthiness of the Alexandros T. All these allegations arise out of the alleged manner in which the defendants handled Starlight's claim in respect of the Alexandros T, and, even though the consequences and the consequential losses have expanded, and the claim for moral damages has been included, and although it seems that Starlight now rely on an expanded affidavit of Mr Miranda, the allegations, even though put into the context of Greek law, were said by the judge to be materially identical to those made prior to the settlement agreement. The acts complained of are all said to have constituted delicts under Greek law akin to the torts of defamation and malicious falsehood under English law. The present position Since the issue of the Greek proceedings, as Longmore LJ explained in para 16 (and the judge at his para 14), the insurers have taken further steps and brought further proceedings in England as follows. By applications issued in the 2006 proceedings on 25 July and 3 August 2011, the CMI and the LMI respectively sought, pursuant to the Tomlin Orders (if necessary after lifting the stay imposed by them) summary relief pursuant to CPR Part 24 by way of declarations and damages against Starlight. The LMI, because permission was given to them to join OME as a third party, also sought summary relief pursuant to Part 24 against OME (which filed an acknowledgment of service and a defence) to enforce the LMI settlement agreement, to which it also was a party. In addition, fresh proceedings (2011 Folio 702) were commenced by the LMI, without prejudice to their case that sufficient relief could and would be obtained in the 2006 proceedings, against both Starlight and OME, and, after an acknowledgment of service and defence were filed, an application was made under Part 24 for similar relief to the claim in the 2006 proceedings. The LMI also brought fresh proceedings (2011 Folio 1043) against Starlight's co assured and, again after acknowledgments of service and defence had been filed, sought declaratory relief and damages for breach of the exclusive jurisdiction clause in their insurance policies, by virtue of the issue of the Greek proceedings by those co assured. Also in fresh proceedings (2011 Folio 894), the CMI brought claims against OME and the same co assured in respect of similar claims for breach of the exclusive jurisdiction clause in the policy, and in respect of OME by reference to breach of the terms of the settlement agreement. Judgment in default was entered by the CMI against all those defendants on 26 October (amended on 14 November) 2011. Those proceedings are not the subject of this appeal and no issue therefore currently arises with respect to them. Finally, and by separate application, the HD defendants were joined as defendants in the 2006 proceedings so that, in due course, they too might be able In summary, the claims made in the various proceedings are these. to claim relief by seeking declaratory relief within the original proceedings. Starlight and their associates applied to stay both the 2006 proceedings in their current form and 2011 Folios 702 and 1043. (a) The 2006 proceedings. (1) The CMI claim against Starlight and, through Part 20 proceedings, against OME (i) a declaration that the Greek claims fall within the terms of the release in the CMI settlement agreement; (ii) a declaration that the bringing of the Greek claims was a breach of the release in the settlement agreement; (iii) damages for breach of the release in the settlement agreement; (iv) a declaration that the bringing of the Greek claims was a breach of the jurisdiction clauses in the settlement agreement and the policies; (v) damages for breach of the jurisdiction clauses in the policies and CMI settlement agreement; and (vi) an indemnity under clause 3 of that agreement in respect of claims brought by Starlight and/or its associated companies in the various Greek proceedings; (2) the LMI claim against Starlight (i) declarations that the LMI settlement agreement settles any claim against them by Starlight in respect of the loss of the Alexandros T and covers Starlights claims in the Greek proceedings (para 3); (ii) a declaration that Starlight is in breach of that agreement in bringing the Greek proceedings; (iii) damages for breach of the settlement agreement; and (iv) a declaration that the agreement entitles the LMI to an indemnity against Starlight in respect of the matters covered by the indemnity, which includes all claims by Starlight and its associated companies in the Greek proceedings; and (3) the LMI claims against OME by Part 20 proceedings: (i) like relief to that which the LMI claim against Starlight, as summarised above; and possibly (ii) damages for breach of the exclusive jurisdiction clause in the policy, although this claim is not repeated among the prayers. (b) Action 2011 Folio 702. The LMI claim against Starlight and OME: (i) declarations that the LMI settlement agreement settles any claim against them by Starlight and/or OME in respect of the loss of the Alexandros T and covers Starlights and/or OMEs claims in the Greek proceedings; (ii) damages for breach of that agreement; (iii) damages for breach of the jurisdiction clause in the policy; and (iv) damages for breach of the jurisdiction clause in the settlement agreement. (c) Action 2011 Folio 1043. The LMI claim against five of Starlights co assureds for breach of their policy jurisdiction clauses. The decisions of the judge and the Court of Appeal The insurers sought to enforce the settlement agreements referred to in the Tomlin Orders and, in a judgment handed down on 19 December 2011, having refused a stay under Article 28, the judge held that they were entitled to summary judgment for (inter alia) a declaration that the matters sought to be raised in Greece were part of the settlement of the claim and that Starlight (and OME) are bound to indemnify the insurers against any costs incurred and any sums that may be adjudged against them in the Greek proceedings. As stated above, the Court of Appeal held that it was bound to stay the 2006 proceedings and 2011 Folio 702 and 1043 under Article 27, made no final determination of the position under Article 28 and declined to consider the issues of summary judgment. The Court of Appeal also held that it was not too late for the respondents to rely upon Article 27 or Article 28. The issues In this Court the appellants challenge the correctness of the Court of Appeals conclusion under Article 27 and, on the respondents cross appeal, submit that the judge was correct to refuse a stay under Article 28. If the appellants succeed under both articles, the case will have to be remitted to the Court of Appeal to consider the respondents appeal from the summary judgment granted by the judge. Article 27 The questions for decision under Article 27 are whether, in the events which happened, the Court of Appeal was wrong to hold that it was not too late for the respondents to rely upon Article 27, whether the proceedings in Greece and the proceedings in England involve the same cause of action, whether they are between the same parties and which court was the court first seised. For reasons which will appear, I will defer consideration of the too late point until after consideration of the other issues. Article 27 must be construed in its context. The immediate context of Articles 27 and 28 is that they form part of Section 9 of Chapter II of the Regulation, which must be read in the light of Recitals 2 and 15 of the preamble. It is apparent from Recital 2 that the Regulation aims, in the interests of the proper functioning of the internal market, to put in place: Provisions to unify the rules of conflict of jurisdiction in civil and commercial matters and to simplify the formalities with a view to rapid and simple recognition and enforcement of judgments from Member States bound by this Regulation. Recital 15 provides: In the interests of the harmonious administration of justice it is necessary to minimise the possibility of concurrent proceedings and to ensure that irreconcilable judgments will not be given in two Member States. There must be a clear and effective mechanism for resolving cases of lis pendens and related actions and for obviating problems flowing from national differences as to the determination of the time when a case is regarded as pending. For the purposes of this Regulation that time should be defined autonomously. The mechanism referred to in Recital 15 is provided by Section 9 of Chapter II of the Regulation, which includes Articles 27 and 28: Section 9 Lis pendens related actions Article 27 1. Where proceedings involving the same cause of action and between the same parties are brought in the courts of different member states, any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established. 2. Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court. Article 28 1. Where related actions are pending in the courts of different member states, any court other than the court first seised may stay its proceedings. 2. Where these actions are pending at first instance, any court other than the court first seised may also, on the application of one of the parties, decline jurisdiction if the court first seised has jurisdiction over the actions in question and its law permits the consolidation thereof. 3. For the purposes of this Article, actions are deemed to be related where they are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings. Article 29 Where actions come within the exclusive jurisdiction of several courts, any court other than the court first seised shall decline jurisdiction in favour of that court. Article 30 For the purposes of this Section, a court shall be deemed to be seised: 1. at the time when the document instituting the proceedings or an equivalent document is lodged with the court, provided that the plaintiff has not subsequently failed to take the steps he was required to take to have service effected on the defendant, or 2. if the document has to be served before being lodged with the court, at the time when it is received by the authority responsible for service, provided that the plaintiff has not subsequently failed to take the steps he was required to take to have the document lodged with the court." The Regulation is the successor to the Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters 1968 (the Brussels Convention), in which the equivalent provisions to Articles 27 and 28 were Articles 21 and 22 respectively. The Court of Justice of the European Union (the CJEU) has held that the principles developed in its case law with regard to Articles 21 and 22 of the Brussels Convention apply equally to Articles 27 and 28 of the Regulation: see Folien Fischer AG v Ritrama SpA (Case C 133/11) [2013] QB 523 at paras 31 and 32. The CJEU was of course previously the European Court of Justice (ECJ). Although some of the decisions to which I refer were made by the ECJ, for simplicity I will refer to all the European decisions as those of the CJEU. The CJEU has laid down a number of general principles which are of some importance. They include the important principle that a court in a Member State must not grant an anti suit injunction to restrain the bringing or continuing of proceedings in another Member State, whether to restrain an abuse of process or to restrain proceedings brought or continued in breach of an exclusive jurisdiction clause: see eg Turner v Grovit (Case C 159/02) [2005] 1 AC 101 and West Tankers Inc v Allianz SpA (The Front Comor) (Case C 185/07) [2009] 1 AC 1138. They also include the following, with specific reference to Articles 27 and First, the purpose of Article 27 is to prevent the courts of two Member States from giving inconsistent judgments and to preclude, so far as possible, the non recognition of a judgment on the ground that it is irreconcilable with a judgment given by the court of another Member State: Gubisch Maschinenfabrik KG v Palumbo (Case C 144/86) [1987] ECR 4861 at para 8. Second, the objective of Article 28 is to improve co ordination of the exercise of judicial functions within the European Union and to avoid conflicting and contradictory decisions, thus facilitating the proper administration of justice: see eg The Tatry (Case C 406/92) [1999] QB 515 at paras 32, 52 and 55 and Sarrio SA v Kuwait Investment Authority [1999] 1 AC 32, per Lord Saville at 39F H. The CMI claims: same causes of action? 28. It is convenient to consider first the position of the CMI claims. The first specific question is whether the 2006 proceedings involve the same cause or causes of action as the Greek proceedings, by which I mean Greece 1 and Greece 2. The principles of EU law which are relevant to the determination of this question are in my opinion clear. They have been considered in a number of cases in the CJEU and are essentially as submitted on behalf of the CMI. They may be summarised in this way. i) ii) iii) iv) The phrase "same cause of action" in Article 27 has an independent and autonomous meaning as a matter of European law; it is therefore not to be interpreted according to the criteria of national law: see Gubisch at para 11. In order for proceedings to involve the same cause of action they must have "le mme objet et la mme cause". This expression derives from the French version of the text. It is not reflected expressly in the English or German texts but the CJEU has held that it applies generally: see Gubisch at para 14, The Tatry at para 38 and Underwriting Members of Lloyds Syndicate 980 v Sinco SA [2009] Lloyd's Rep IR 365, per Beatson J at para 24. Identity of cause means that the proceedings in each jurisdiction must have the same facts and rules of law relied upon as the basis for the action: see The Tatry at para 39. As Cooke J correctly stated in JP Morgan Europe Ltd v Primacom AG [2005] 2 Lloyd's Rep 665 at para 42, The expression 'legal rule' or 'rule of law' appears to mean the juridical basis upon which arguments as to the facts will take place so that, in investigating 'cause' the court looks to the basic facts (whether in dispute or not) and the basic claimed rights and obligations of the parties to see if there is co incidence between them in the actions in different countries, making due allowance for the specific form that proceedings may take in one national court with different classifications of rights and obligations from those in a different national court. Identity of objet means that the proceedings in each jurisdiction must have the same end in view: see The Tatry at para 41, Gantner Electronic GmbH v Basch Exploitatie Maatschappij BV (Case C 111/01) [2003] ECR I 4207 at para 25, Primacom at para 42 and Sinco at para 24. v) The assessment of identity of cause and identity of object is to be made by reference only to the claims in each action and not to the defences to those claims: see Gantner at paras 24 32, where the CJEU said this in relation to Article 21 of the Brussels Convention: . in order to determine whether two claims brought between the same parties before the courts of different Contracting States have the same subject matter, account should be taken only of the claims of the respective applicants, to the exclusion of the defence submissions raised by a defendant. See also to similar effect Kolden Holdings Ltd v Rodette Commerce Ltd [2008] 1 Lloyd's Rep 434, per Lawrence Collins LJ at para 93 and Research in Motion UK Ltd v Visto Corporation [2008] 2 All ER (Comm) 560, per Mummery LJ at para 36. vi) It follows that Article 27 is not engaged merely by virtue of the fact that common issues might arise in both sets of proceedings. I would accept the submission on behalf of the CMI that this is an important point of distinction between Articles 27 and 28. Under Article 28 it is actions rather than claims that are compared in order to determine whether they are related. vii) After discussing Gubisch, The Tatry, Sarrio, The Happy Fellow [1998] 1 Lloyds Rep 13 and Haji Ioannou v Frangos [1999] 2 Lloyds Rep 337, Rix J summarised the position clearly and, in my opinion, accurately in Glencore International AG v Shell International Trading and Shipping Co Ltd [1999] 2 Lloyds Rep 692 at 697: It would appear from these five cases, of which the first two were in the European Court of Justice, and the latter three in the domestic Courts of England, that, broadly speaking, the triple requirement of same parties, same cause and same objet entails that it is only in relatively straightforward situations that art 21 bites, and, it may be said, is intended to bite. After all, art 22 is available, with its more flexible discretionary power to stay, in the case of related proceedings which need not involve the triple requirement of art 21. There is no need, therefore, as it seems to me, to strain to fit a case into art 21. The European Court, when speaking in Gubisch (at para 8) of the purpose, in the interests of the proper administration of justice within the European Community, of preventing parallel proceedings in different jurisdictions and of avoiding in so far as it is possible and from the outset the possibility of irreconcilable decisions, was addressing arts 21 and 22 together, rather than art 21 by itself. Thus a prime example of a case within art 21 is of course where party A brings the same claim against party B in two jurisdictions. Such a case raises no problem. More commonly, perhaps, the same dispute is raised in two jurisdictions when party A sues party B to assert liability in one jurisdiction, and party B sues party A in another jurisdiction to deny liability, or vice versa. In such situations, the respective claims of parties A and B naturally differ, but the issue between them is essentially the same. The two claims are essentially mirror images of one another. Gubisch and The [Tatry] are good examples of this occurrence. On the other hand, Sarrio v KIA is a case where the same claimant was suing the same defendant on different bases giving rise to different issues and different financial consequences, and where liability on one claim did not involve liability (or non liability) on the other. Haji Ioannou v Frangos illustrates the situation where even though the cause is the same, and even though there is some overlap in the claims and issues, nevertheless different claims, there the proprietary claim to trace, may raise sufficiently different issues of sufficient importance in the overall litigation for it to be concluded that the objet differs. The authority of The Happy Fellow at first instance may be somewhat shaken by the reservations expressed by Lord Justice Saville on appeal, but it too may be said to illustrate the process of analysing the claims and issues in the respective proceedings to identify whether they are the same. Where, for instance, there is no dispute over a shipowners right to limit should he be found liable (a separate question, which need not even be resolved at the time when a limitation action is commenced or a decree given), I do not for myself see why it should be held that the liability action and the limitation action involve the same cause of action for the purposes of art 21. How do these principles provide an answer to the question whether the 2006 proceedings involve the same cause or causes of action as the Greek proceedings? It is necessary to consider the claims advanced by the CMI and the LMI separately and, in the case of each cause of action relied upon, to consider whether the same cause of action is being relied upon in the Greek proceedings. In doing so, the defences advanced in each action must be disregarded. The essential question is whether the claims in England and Greece are mirror images of one another, and thus legally irreconcilable, as in Gubish and The Tatry, in which case Article 27 applies, or whether they are not incompatible, as in Gantner, in which case it does not. Thus in Gantner a claim for damages for repudiation of a contract and a claim for the price of goods delivered before the repudiation could both have succeeded and the fact that a set off of the damages would make the price less beneficial to the seller did not make them incompatible. And in Maersk Olie & Gas A/S v Firma M de Haan en W De Boer (Case C 39/02) [2004] ECR I 9657 owners of a vessel which damaged a pipeline (owned by Maersk) sought a declaration that they were entitled to limit their liability under the 1957 International Convention relating to the Limitation of Liability of Owners of Sea going Ships and the Dutch legislation that gave effect to it and that a limitation fund be established. Maersk subsequently commenced proceedings in Denmark claiming compensation for damage to the pipeline. The CJEU held that the causes of action were not the same: see paras 35 to 39. The CJEU underlined both the principle in Gantner that account should be taken only of the claims and not of the defences advanced and the principle in The Tatry that the cause of action comprised both the facts and the legal rule invoked as the basis of the application. It held on the facts, at para 38, that: the unavoidable conclusion is that, even if it be assumed that the facts underlying the two sets of proceedings are identical, the legal rule which forms the basis of each of those applications is different. The action for damages is based on the law governing non contractual liability, whereas the application for the establishment of a liability limitation fund is based on the 1957 Convention and the Netherlands legislation which gives effect to it. The CJEU thus distinguished Gantner and The Tatry on the basis that in those cases, by contrast, the claim brought in the second set of proceedings mirrored that brought in the first set. What then is the position on the facts? The CMI advance the claims referred to in para 18 above under three heads, each of which relies upon provisions either of the CMI settlement agreement or the policies. It is convenient to consider the claims under the three heads in this order: indemnity, exclusive jurisdiction and release. Indemnity claims These are based on clause 3 of the settlement agreement set out above. The claims are simple. By clause 3 the Assured as defined agreed to indemnify the CMI against any claim that might be brought against them by any of the Assureds or the Claimants associated companies or organisations or by any mortgagee in relation to the loss of Alexandros T or under the relevant policy. The CMI say that the Greek proceedings are in respect of such claims and that they are entitled to be indemnified against the consequences of those proceedings. They say that that claim under clause 3 does not give rise to the same claim or cause of action as any claim or cause of action in the Greek proceedings. They say that, on the contrary, it assumes that the Greek proceedings will proceed and that the claimants in Greece may succeed. I would accept that submission. In my opinion, none of the causes of action relied upon in the Greek proceedings has identity of cause or identity of object with the CMIs claim for an indemnity. As to cause, the subject matter of the two claims is different. The former are claims in tort (or its Greek equivalent) and the claim for an indemnity is a claim in contract. As to object, that of the Greek proceedings is to establish a liability under Greek law akin to tort, whereas, as for example in the case of a claim on an insurance policy, the object of the CMIs claim is to establish a right to be indemnified in respect of such a liability. Further, whereas Starlight and its co assureds and the individual officer claimants in the Greek proceedings are seeking each to recover its or his own loss, the indemnity clause will, if the indemnity claim is otherwise good, entitle the CMI to recover from Starlight not just any sum awarded in Greece to Starlight, but also any sums awarded to any of Starlights co claimants. So the object of the English indemnity claim against Starlight differs from, and is in fact much wider than, the object of Starlights claim in the Greek proceedings. Moreover, the claim for an indemnity in the 2006 proceedings in England does not interfere in any way with the Greek proceedings or vice versa. There is no attempt in Greece to impugn the settlement agreements or the indemnity agreements contained in them. The respondents do not assert, for example, that the indemnities do not apply to some or all of the Greek claims. I would determine this point in favour of the CMI on this simple basis. The CMIs cause of action for an indemnity under clause 3 of the settlement agreement is not the same cause of action as any of the causes of action relied upon in Greece, which are tortious. The respective causes of action have neither the same object (le mme objet) nor the same cause (la mme cause). Exclusive jurisdiction clauses The same is in my opinion true of the CMIs claims that the respondents have brought the proceedings in Greece in breach of the exclusive jurisdiction clauses in the settlement agreement and/or in the insurance policies. Clause 6 of the settlement agreement expressly provides that it is subject to English law and the exclusive jurisdiction of the High Court in London. The CMI say that, in bringing the Greek proceedings, the respondents are in breach of clause 6 and that they are entitled to damages as a result. They do not seek an anti suit injunction to restrain the Greek proceedings. They simply seek a declaration that the claims brought by Starlight and OME in Greece 1 and Greece 2 fall within the scope of the settlement agreement. Moreover the respondents do not assert in the Greek proceedings that the settlement agreements do not preclude the bringing of their claims in Greece. It may be that the reason they do not advance that argument is that they would be met with the response that a dispute as to the meaning and effect of the settlement agreements is subject to the English jurisdiction clause so that the court in Greece would have to decline jurisdiction. However that may be, they do not in fact advance the argument. It follows that in this respect too the Greek proceedings are not the mirror image of the English proceedings or vice versa and that the cause or causes of action based on an alleged breach of clause 6 of the CMI settlement agreements are not the same cause or causes of action as are advanced by the respondents in Greece. They do not have le mme objet et la mme cause. As I see it, the position is the same in the case of the alleged breach of the exclusive jurisdiction clauses in the insurance policies. There is an established line of cases in England to the effect that claims based on an alleged breach of an exclusive jurisdiction clause or an arbitration clause are different causes of action from claims for substantive relief based on a breach of the underlying contract for the purposes of Article 21 of the Brussels Convention and Article 27 of the Regulation: see eg Continental Bank NA v Aeakos Compania Naviera SA [1994] 1 WLR 588 per Steyn LJ (giving the judgment of the Court of Appeal) at 595H 596C; Alfred C Toepfer International GmbH v Molino Boschi Sarl [1996] 1 Lloyds Rep 510 per Mance J at 513; Toepfer International GmbH v Socit Cargill France [1997] 2 Lloyds Rep 98, per Colman J at 106; Sinco per Beatson J at paras 50 and 54; and WMS Gaming Inc v Benedetti Plus Giocolegale Ltd [2011] EWHC 2620 (Comm) per Simon J at para 32. Those cases support the conclusion that the claims of the CMI in the 2006 proceedings for breach of the exclusive jurisdiction clauses in the insurance policies (or indeed in the settlement agreement) do not involve the same cause or causes of action within the meaning of Article 27 as the respondents claims in (or akin to) tort in the Greek proceedings. I understand that this point has been reserved for decision by the Court of Appeal but, as I see it at present, nothing in the relief sought by the CMI offends the principle of mutual trust and confidence which underlies the Regulation: see eg Erich Gasser GmbH v MISAT Srl (Case C 116/02) [2005] QB 1. The CMI do not seek to stop the Greek proceedings or to restrain Starlight and OME from pursuing them. They merely seek declarations as to the true position under the settlement agreements which are both governed by English law and subject to the exclusive jurisdiction of the English courts and under the clauses in the insurance contracts which also provide for the exclusive jurisdiction of the English courts. This has the advantage that the courts with exclusive jurisdiction decide what is the true meaning of the settlement agreements and the jurisdiction clauses. Release The same is also, in my opinion, true of the claims based on what are called the release provisions in the CMI settlement agreement. It is said that the provision that the sums agreed to be paid under the CMI settlement agreement are to be paid in full and final settlement of all and any claims it may have under the policy precludes the payment of any further sums arising out of the loss of the vessel insured. It is said that, in the light of the agreement, the CMI are entitled to a declaration that the Greek claims fall within the terms of the agreement, that they are entitled to a declaration that the bringing of those claims is a breach of the agreement and that they are entitled to damages for that breach. The question is whether these claims involve le mme objet et la mme cause as the claims in the Greek proceedings. In my opinion they do not for the same reasons as in the case of the claims for an indemnity and the claims arising out of the exclusive jurisdiction clauses. The Greek claims are claims in tort and these are contractual claims. The factual bases for the two claims are entirely different. Moreover the object of the two claims is different. This is to my mind clear in the case of the claims for damages for breach of the release provisions in the settlement agreements and for a declaration that the bringing of the Greek claims is a breach of the settlement agreement. The nature of the claims is almost identical to the nature of the claims for breach of the jurisdiction agreements. In both cases the alleged breach is the bringing of the claims in Greece. Moreover, like the claims for an indemnity, the claim for damages for breach of the settlement agreement assumes that the claims in Greece may succeed. Is the position different in respect of the claim for a declaration that the Greek claims fall within the terms of the release in the settlement agreements? In my opinion the answer is no. All these claims have the same thing in common. It is that the legal basis for the claims in Greece is different from the legal basis of the claims in England. In Greece the legal basis for the claims is tortious, whereas in England the legal basis of the claims is contractual. It is thus not a case like Gubisch, where, as the CJEU put it at para 15, the same parties were engaged in two legal proceedings in different Contracting States which were based on the same cause of action, that is to say the same contractual relationship. The cause was therefore the same. Equally the objet of the actions was the same, namely to determine the effect if any of the contract. As the CJEU put it at para 16, the action to enforce the contract was aimed at giving effect to it, while the action for its rescission or discharge was aimed precisely at depriving it of any effect. The question whether the contract was binding lay at the heart of the two actions. That is not true here because the object of the English action is to enforce the contract, whereas the object of the Greek proceedings is to establish a different liability in tort. Lord Mance takes a different view in one respect. So far as the claims for damages for breach of the releases in the settlement agreements, the claims for a declaration and damages for breach of the jurisdiction clauses and the claims for indemnities are concerned, there is no difference between us. However, so far as the claims for a declaration that the Greek claims fall within the terms of the release in the settlement agreements is concerned, Lord Mance takes a different view. He notes in para 140 the terms in which the claims are pleaded. The formulation in paragraph 18(a) above, which was adopted by the respondents, is in fact derived from the declaration made by the judge. However, to my mind nothing turns on this difference. Moreover, I do not see that it makes any difference that the respondents discharged their obligations under the settlement agreements. The critical point is that on the facts here the legal basis of the claims in tort in Greece is different from the legal basis of the contractual claims in England. It is true that, if successful, a declaration that the tortious claims have been settled or released will or may afford the appellants a defence to the Greek proceedings but the cases show that defences are irrelevant. Viewed through the perspective of the claims, the two claims are not the mirror image of one another. Even if (contrary to my view) the two sets of proceedings had in this respect le mme objet they did not have la mme cause, whereas the cases show that, in order to involve the same cause of action, they must have both le mme objet et la mme cause. The position would be different if the CMI were to advance a claim in the English proceedings claiming a declaration that they are not liable to the respondents in Greece. That claim would be the mirror image of the claims being brought by the respondents in Greece and would fall within the principles laid down in Gantner and The Tatry. In fact, after the judge had delivered his judgment, the CMI did, as I understand it, make an application for such a negative declaration in the light of the fact that Starlight and OME had commenced Greece 2. We were told that in the event the application was never determined and that the CMI do not pursue it. It has been confirmed that any such claim has now been abandoned. For these reasons, subject to a possible reference to the CJEU discussed in paras 58 59 below, I would hold that Article 27 does not apply to any of the causes of action advanced by or against the CMI. I appreciate that, in reaching these conclusions I have reached a different view from that of the Court of Appeal. Before I express my reasons, I should say that I suspect that the focus of the argument in the Court of Appeal was somewhat different from that in this Court. The reasons are I think twofold. First, in para 40 of his judgment Longmore LJ distinguished Sinco on the basis that the difference between this case and that is that in that case, in contradistinction to this, there was no settlement agreement which could, as he put it, supposedly deny the Greek claimants the right to bring proceedings at all. I do not see that as correct. As explained above, the CMI do not seek to deny the respondents the right to commence proceedings in Greece but merely say that the causes of action in the two sets of proceedings are different. The second point is perhaps more significant. In para 46 Longmore LJ correctly notes that the CMIs case is that the bringing of the Greek proceedings is a breach of the jurisdiction clauses in the policies and a breach of the terms of the settlement agreement and, again correctly, states that the primary relief claimed by the CMI in England is a declaration that Starlight will be liable to indemnify the CMI against any costs incurred in the Greek proceedings and any liability in those proceedings. I have already given my reasons for concluding that those are different causes of action from the causes of action in tort relied upon by the respondents in Greece. They are not a mirror image of one another. As I see it, the Court of Appeal treated the question as a broad one focusing on the overall result in each jurisdiction. This can be seen from paras 47 to 50 of Longmore LJs judgment. In paras 46 and 47 he summarised the claims of both the CMI and the LMI. He then said this at paras 48 and 49: 48. It is clear that the first 3 paragraphs of the LMI application are in terms an assertion that LMI are not liable in respect of the claims in Greece. CMI's allegation that the Greek claimants are in breach of the settlement agreements is in effect a similar assertion. It may be said that there are other causes of action in the English proceedings which are not exactly mirror images of the allegations in the Greek proceedings but to the extent that they are not, they are essentially the same in the sense that the key assertion in Greece is that there are non contractual claims and the key assertion in England is that those non contractual claims have been compromised by the settlement agreements. The claims for damages and indemnity are in any event parasitic on the central contention that, once a settlement had been reached, all matters in issue had been compromised. It is, of course, elementary that Article 27 has regard to causes of action rather than proceedings and that is why it is necessary to concentrate on the allegations relating to the settlement agreement. It is certainly the case that there is a considerable risk of inconsistent judgments if one of the sets of proceedings is not stayed and the rationale behind Article 27 therefore favours a stay if the Greek court was the court first seised. 49. I therefore conclude that, in so far as the English proceedings assert non liability by reason of the settlement agreements, there is an identity of issues and the respective causes of action are the same. To the extent that allegations are made in England that the Greek parties are in breach of the settlement agreements or in breach of the exclusive jurisdiction clauses in either the insurance policy or the settlement agreements themselves (and that they should therefore indemnify the insurers for the cost of the Greek proceedings) they are parasitic and dependent on the basic cause of action in England for a declaration of non liability. They cannot proceed in their own right until the underlying question of the ambit of the settlement agreements as a defence to the Greek actions in tort has been resolved. In my opinion that analysis is not consistent with the principles laid down by the CJEU set out above. As already stated, those principles require a comparison of the claims made in each jurisdiction and, in particular, consideration of whether the different claims have le mme objet et la mme cause without regard to the defences being advanced. As I see it, Article 27 involves a comparison between the causes of action in the different sets of proceedings, not (as in Article 28) the proceedings themselves. In para 48 Longmore LJ recognises that there are causes of action in the English proceedings which are not (as he puts it) exactly mirror images of the allegations in the Greek proceedings but says that, to the extent that they are not, they are essentially the same in the sense that the key assertion in Greece is that there are non contractual claims and the key assertion in England is that those non contractual claims have been compromised by the settlement agreements. And at the end of para 49 he says that the claims in England cannot proceed in their own right until the underlying question of the ambit of the settlement agreements as a defence to the Greek action in tort has been resolved. I respectfully disagree with that approach. It focuses on the nature of the settlement agreements as a defence to the Greek action in tort, which the authorities in the CJEU show is irrelevant. Given the fact that defences are irrelevant, the analysis cannot involve a broad comparison between what each party ultimately hopes to achieve. The analysis simply involves a comparison between the claims in order to see whether they have the same cause and the same object. In so far as Andrew Smith J treated the question as a broader one in Evialis SA v SIAT [2003] 2 Lloyds Rep 377 I respectfully disagree with him, although, as Beatson J observed in Sinco at para 50, Evialis was distinguishable on the facts because the insured had brought a substantive claim in the English proceedings in addition to their claim in the Italian proceedings, which rendered the former a mirror image of the latter. This case can be distinguished on the same basis, at least in the case of the CMIs claims. I also note in connection with Sinco that at para 40 Longmore LJ observed that the difference between that case and this was that in that case there was no settlement agreement which could supposedly deny the right of the Greek claimants to bring proceedings at all. For the reasons I have given I would respectfully disagree with that approach. A settlement agreement might be a defence to a claim. It could not deny the right of the Greek claimants to bring proceedings at all. For these reasons I would hold that Article 27 has no application to the case of the CMI. Moreover, subject to one point discussed at paras 58 59 below, I would not order a reference to the CJEU on this question because the relevant principles are clearly set out in its jurisprudence and are acte clair. In these circumstances, where none of the causes of action in the English proceedings is the same as the causes of action in the Greek proceedings, it is not necessary in the case of the CMI to consider the other issues which might arise, namely the position in relation to other parties and which court was the court first seised for the purposes of Article 27. The LMI claims: same causes of action? Save possibly for two points, the position of the LMI is essentially the same as in the case of the CMI. The first point is that the jurisdiction clause in clause 5 of the LMI settlement agreement differs from that in clause 6 of the CMI settlement agreement in that it does not expressly provide for the exclusive jurisdiction of the High Court in London but merely for the jurisdiction of the High Court in London. However, subject to its detailed provisions, Article 23 of the Regulation provides that, where parties have agreed that a court or the courts of a Member State shall have jurisdiction, that court or those courts shall have jurisdiction and, moreover, that such jurisdiction shall be exclusive unless the parties have agreed otherwise. The question whether the parties had agreed otherwise was discussed by the judge at paras 19 to 23 of his judgment, where he held that the parties had not agreed otherwise and that clause 5 of the LMI was an exclusive jurisdiction clause. No appeal was brought against that part of the judges ruling. The second point is this. I had understood during the argument that the LMI were seeking a negative declaration of the kind which the CMI were not. It now appears that I was mistaken. I understand that the LMI had indicated an intention of doing so if the CMI proceeded with an application for permission to do so but, since they did not, nor did the LMI, who have now expressly stated that, like the CMI, they will not do so. As I see it, in these circumstances the position of the LMI is the same as that of the CMI. The causes of action advanced in England in the 2006 action and in 2011 Folio 702, as summarised on behalf of the LMI, are claims by the LMI against Starlight and OME based on clauses 3, 4 and 5 of the LMI settlement agreement. Those advanced in 2011 Folio 1043 are claims by the LMI against the co assureds to enforce the English jurisdiction clause in the insurances. Since, on this basis, the relief sought by the LMI is not a declaration of non liability, the conclusions and reasoning set out above on the question whether the causes of action are the same apply to it. It follows that I would allow the appeals of both the CMI and the LMI on the Article 27 point. However these conclusions are subject to the question whether any of the issues discussed above should be referred to the CJEU. Left to myself, I would not refer any of them because the principles of European law are clear and the only question is how they should be applied in the instant case. However, Lord Mance has arrived at a different view from me on the question whether Article 27 applies to the claims by both the CMI and the LMI for a declaration that the Greek claims fall within the terms of the release in the settlement agreements or that under the agreements the tort claims have been settled. In short he is of the view that those claims are essentially for declarations of non liability. In these circumstances, I have reached the conclusion that the position is the same as I previously considered it to be when I thought that the LMI were seeking a declaration of non liability. That is that, unless the CMI and the LMI abandon those claims within 14 days, we should refer the question whether the claims for those declarations involve the same cause of action as the claims in Greece within the meaning of Article 27. Lord Neuberger has also given reasons why, absent such abandonment, this question should be referred. On the other hand, if the CMI and the LMI do abandon those claims, I would allow both their appeals under Article 27 and refuse a mandatory stay of the proceedings under it. If they do not abandon those claims, I would allow the appeals under Article 27 in respect of the other claims but refer the question referred to above to the CJEU and defer a decision on that issue until the CJEU has determined the question. Seisin under Article 27 It is not I think in dispute (and is in any event correct) that a court is only seised of claims by or against new parties from the date that those parties are added to the proceedings. In relation to the 2006 proceedings, the English court was only seised of claims against OME once OME was joined to the proceedings on 20 September 2011 and, for example, to the extent that the LMI in action 2011 Folio 702 are seeking declarations relying on the settlement agreement as a settlement of or defence to Starlight's and OME's claims in the Greek proceedings, the English courts were only seised of that action in 2011. It follows that, in each of those cases the court first seised was the Greek court and not the English court, and that, to the extent that the LMI advance claims for a declaration that the Greek claims fall within the terms of the release in the settlement agreement or that under the agreement the tort claims have been settled, unless the English court is the court first seised, they will be entitled to a stay under Article 27. The same is essentially true of the CMI claims. The question is which court is first seised of what in circumstances where some of the claims brought in England are different from and based on different causes of action from those brought in Greece and one of them in each case, namely the claim for the declaration or declarations referred to above, is based on the same cause of action. The approach of the parties is starkly different. It is submitted on behalf of the appellants that the answer is to be found in the language of Articles 27 and 30 and is that the court first seised is that in which the proceedings were first brought and that the court remains the court first seised of the proceedings even where those proceedings are subsequently amended by the addition of new claims or otherwise. It is submitted on behalf of the respondents, by contrast, that if a new claim is added by amendment, the court is seised of the proceedings so far as that amendment is concerned when the amendment is made and not at the time of the institution of the original, unamended proceedings. It seems to me that there is considerable force in the appellants analysis of the language of the Regulation but the respondents case has support both in the English cases and in the textbooks. In the course of this judgment I will consider the issues (interesting as they are) only briefly because I have reached the conclusion that, if the appellants persist in their claims for the declarations referred to in paras 58 and 59 above and this issue is critical for the resolution of the appeal, the proper course is to refer the question to the CJEU. The case for the appellants can be summarised thus. Article 27 is concerned with proceedings involving the same cause of action. So, for the purposes of deciding whether to grant a stay of its proceedings under Article 27, the court must compare the cause or causes of action in each set of proceedings. It is Article 30 that determines when the court is deemed to be seised and, by Article 30(1), it provides that (subject to the limited exceptions at the end of Article 30(1) and in Article 30(2)), it is deemed to be seised when the document instituting the proceedings or an equivalent document is lodged with the court. Where the question is which of two courts is first seised, the two dates on which the courts are deemed to be seised are compared and the court deemed to be seised first is the court first seised. The appellants also rely upon the transitional provisions in Article 66, which they say support the proposition that proceedings have only one date upon which they are instituted and is inconsistent with the idea that they can have several such dates as and when new claims are added by amendment. The appellants say that in this case the answer is that the English court was the court first seised because the Greek court was not seised until some five years later. They say that this is a simple rule which is easy to apply and that there is no warrant in the language of the Regulation for concluding that it was intended that the court should be seised anew each time a new claim is added by amendment, which would be complicated and unnecessary and give rise to endless interlocutory disputes. The appellants criticise Longmore LJ for asking in para 52 whether it can be said that the English court was first seised of the relevant causes of action now pursued in Greece and for noting that Article 27 only has regard to "causes of action" rather than proceedings. They say that that is inconsistent with Articles 27 and 30 because Article 27(1) uses the word "proceedings" twice and it is used again in Article 30(1). They recognise that for the purpose of deciding whether there is le mme objet or la mme cause the court must look to the claims made but, for the purpose of deciding which court is deemed to be "first seised" under Article 27, the autonomous test in Article 30 is applied. Finally, they say that Article 30 does not mention "causes of action" and that the Court of Appeal overlooked the word "proceedings" used twice in Article 27, and did not refer to Article 30 at all. Moreover, although the word "proceedings" is not defined in the Regulation, it appears nearly 50 times in the Regulation used as a word of general application. The uses of the word show that issues or causes of action (or claims) may change during the course of the "proceedings". The appellants further criticise Longmore LJ in the Court of Appeal by reference to paras 53 and paras 64 66. They contrast the reference in para 53 to Article 27 having regard only to causes of action rather than proceedings, with the reference in para 64, with apparent approval, to this quote from the judgment of Saville LJ in The Happy Fellow at pages 17 18: article 21 is concerned with proceedings and article 22 with actions. The questions are whether the proceedings involve the same cause or object or whether the actions are related. It is thus a misreading of the Convention to ask which Court is first seised of issues which are or might be raised within the proceedings or actions. If such were the case, then the articles would achieve precisely the opposite of their intended purpose which is, to achieve the proper administration of justice within the Community . " Saville LJ was there considering the position under what is now Article 28. However the appellants say that the word action in Article 28 means the same as proceedings in Article 27 and that Longmore LJ was correct in paras 64 66 and wrong in para 53. Although the appellants case has to my mind the merit of simplicity and of the avoidance of time consuming and expensive satellite litigation, the respondents say that it is simplistic and contrary to both principle and authority. It is fair to say that there is considerable support in the authorities and the text books for the proposition that the new claims added to the 2006 proceedings, which were founded on the Greek proceedings and thus made second in time, were new claims, that the English court should be regarded as seised of them only when they were added to the 2006 proceedings and that the Greek court was the court first seised within the meaning of Article 27. In the important case of FKI Engineering Ltd v Stribog Ltd [2011] 1 WLR 3264, which was itself a case on Article 28, the Court of Appeal considered Article 27 and a number of cases decided under it. At para 84 Rix LJ said that the essence of the cases was that, where the same cause of action or the same parties are introduced only by way of service, or amendment, the relevant proceedings are only brought at the time of such service or amendment, not at the time of the institution of the original, unamended proceedings. Neither Mummery LJ nor Wilson LJ expressed a different view. The respondents also rely upon Sinco per Beatson J at paras 61 to 68 and, in that connection, upon this comment in Briggs on Civil Jurisdiction and Judgments, 5th edition, 2009 at para 2.235, page 327, note 1: In [Sinco] the proposition that an English court was first seised of a claim for damages for breach of a jurisdiction clause, which could only have been brought before the English court after the objected to proceedings were instituted before the foreign court, was rather challenging. And in Research in Motion UK Ltd v Visto Corporation [2007] EWHC 900 (Ch), Lewison J said at para 19: It is also common ground that the counterclaim is to be treated as an action in its own right for the purposes of the judgment regulation. It seems to me that once RIM's English non infringement action is out of the way the only relevant proceedings are Visto's counterclaim and the Italian proceedings. Of those two, the Italian court is plainly the first seised. Indeed it cannot be otherwise since the very fact of the Italian claim is part of the foundation of the counterclaim. The respondents rely upon Briggs at para 2.235, where, as I read it, their case is supported, although some doubts are expressed as to the desirability of this approach. The respondents also relied upon the 15th edition, 2012 of Dicey, Morris and Collins on The Conflict of Laws at paras 12 060 and 12 069, where they say this: 12 060. Each lis between a plaintiff and a defendant has to be considered individually to determine which court was seised of it first in time, and article 27 applied accordingly. 12 069. Where a claim form which has been issued and served is amended by the addition of an additional claim, or by the introduction of a claim or counterclaim against another party, the material question is whether the date of seisin in respect of the additional claim is the date on which the amended claim form is reissued (which may, depending on the circumstances, be only after obtaining the permission of the court), or the date of the original issue. As it is difficult to see how a court can be said to be seised of a claim which has not been made and does not appear in the claim form, it cannot be correct that as long as a claim form has been issued and served, the court already has temporal priority over any issue which may later be added by amendment. It would follow from a conclusion that the court is not seised of the new claim until the amended claim form is reissued that the defendant may be able to pre empt the amendment by commencing an action of his own in another Member State. The court seised with such pre emptive proceedings will obviously be regarded as being seised later than the court before which the original action was brought, but institution of the later action may serve to prevent the proposed, and now duplicative, amendment of the original action; and there is no basis in the Regulation for refusing to give effect to a use of the rules which might be characterised as sharp practice. Finally, the respondents rely upon Fentiman on International Commercial Litigation, 2010, at para 11.27: Principle suggests that an amended claim arising from the same facts as the original claim might be consolidated with the original claim for the purposes of Article 30 but not where the facts arose subsequently. In the latter case it does no violence to the expressions 'actions' or 'proceedings' to differentiate the claims. While these expressions of view undoubtedly provide strong support for the respondents submissions, some of them seem to me to be expressed in a somewhat tentative way and I am not sure that the textbook writers grapple with the points made by the appellants on the language of the Regulation. However that may be, as indicated earlier, I am of the opinion that this issue is by no means acte clair and, if the appellants maintain their claim or claims in England for a declaration that the Greek claims fall within the terms of the release in the settlement agreements or that under the agreements the tort claims have been settled, I would refer an appropriate question to the CJEU before forming a concluded view with regard to the applicability to that claim or claims. If they abandon them, I would hold that the respondents are not entitled to a stay under Article 27, refuse them a mandatory stay in respect of all the claims and allow the appellants appeal. Article 28 The question whether those claims which are not within Article 27 should be stayed depends upon whether they should be stayed under Article 28. As stated above, in the exercise of his discretion the judge refused the respondents application for a stay under Article 28. The appellants say that he was right to do so. The respondents case is that the English court was second seised for the purpose of Article 28 and that a stay should be granted as a matter of discretion. Seisin under Article 28 It is plain from the express terms of Article 28(1) that the discretion in Article 28 is limited to any court other than the court first seised. It follows that, if the English court was first seised, it has no discretion to stay. Article 28 moreover applies to related actions pending in the courts of different member states and, by Article 28(3), actions are deemed to be related where they are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings. It is not in dispute in these appeals that the various proceedings are related proceedings for the purposes of Article 28 and I would in any event so hold. The questions remain whether the actions are pending, whether the English court is the court first seised and, if it is not, how the discretion should be exercised. In Stribog the Court of Appeal considered the correct approach to Article 28. It held that two questions arise, namely (1) whether the two sets of proceedings are related, taking account of any amendments which have been made at the time of the enquiry and (2) which set of proceedings were commenced first? Rix LJ expressed the position clearly at paras 119 and 120. He explained that it is only when there are related and pending actions in separate member states that Article 28 comes into issue. The question whether they are related is, as he put it, the Article 28(3) question. He then said: 119. The question of when seisin occurs and thus which of the courts is the court first seised is the article 30 question. FKIs submission in effect seeks to roll the two questions together and ask: which of the two courts is the first to be seised of an action which at the time of its seisin was a related action? This is the concept of the first related action, a concept found in neither article 28 nor article 30. Stribog on the other hand asks: once you have found two related and pending actions and seek to stay one of them, invoking article 28, which of the two courts was the first to achieve seisin of one or other of those actions? 120. In my judgment, the latter question is the correct one, and is to be preferred to the former . See also per Mummery LJ at paras 40 to 44, where he stressed in particular that the question is whether the court concerned is seised of an action and not of a particular issue in an action. He also stressed that the time at which the comparison between the two actions is made is the time of the hearing of the application for the stay. Wilson LJ noted at paras 132 134 that Mummery and Rix LJJ asked the relevant questions in a slightly different order: Mummery LJ asked which court was first seised in a pending action before asking whether the actions were related, whereas Rix LJ preferred to ask them in the reverse order. Wilson LJ said that he did not see why the order matters but that Rix LJ seemed to have the terminology of Article 28 on his side. I agree. The question whether the actions are pending is closely related to the question whether the English court remains first seised. The respondents say that there was no action pending in England when the Greece 1 proceedings were commenced. In the alternative they say that, if the original action is still alive, the English court is not first seised because the claims now brought are entirely new claims, which they say should be equated with new proceedings. I will consider these points in turn. On the first point, the appellants say, by contrast, that the 2006 proceedings are still on foot, and thus pending, having been stayed but not finally concluded. I would accept the appellants submissions. The settlement agreements were in this respect in identical terms. It was a term of them that Starlight would obtain a stay by way of Tomlin Orders. The orders were both in the same terms, which are standard in such cases, and (as quoted in para 7 above) provided that save for the purposes of carrying into effect the terms agreed all further proceedings shall be stayed. It appears to me that, on the true construction of those orders, the actions remained unstayed for the purposes of carrying into effect the terms agreed and were otherwise stayed. As I see it, in so far as the actions remained unstayed, it follows that the court remained seised of them, presumably at least until there was no longer any need for the terms agreed to be carried out. It is plain from the language of Article 28(1) that the court first seised means the court first seised of the action, which must mean first seised of the proceedings, not of particular claims or causes of action within the proceedings. It seems to me to follow that, in so far as the appellants are seeking to enforce the provisions of the settlement agreements, as they are, the English court remains first seised. I arrive at this conclusion by a construction of Article 28(1) and of the Tomlin Order. The appellants were able to pursue these claims without issuing further proceedings. In this regard I would accept the analysis of the judge at paras 24 to 29. I would adopt the analysis of Sir Andrew Morritt V C in Bargain Pages Ltd v Midland Independent Newspapers Ltd [2003] EWHC 1887 (Ch) and I would not follow the reasoning of the Court of Appeal in Hollingsworth v Humphrey, (1987) CAT 1244. What then of the parts of the actions which are stayed under the Tomlin Orders? These would include the claims for breach of the exclusive jurisdiction clauses in the policies of insurance, which do not depend upon the terms of the settlement agreements. The appellants rely upon principles developed by the English courts as a matter of English, not European, law. However, this is in my opinion a permissible approach. Article 30 of the Regulation provides for the circumstances in which a court is deemed to be seised. I recognise of course that the concept of seisin is an autonomous European law device but Article 30 does not make express provision for the circumstances in which it ceases to be seised. In these circumstances, it seems to me to be appropriate for national courts to have regard both to the nature of seisin in European law and to their own procedural rules in deciding whether their courts are no longer seised of a particular set of proceedings. The appellants rely upon the decision of the Court of Appeal in Rofa Sport Management AG v DHLK International (UK) Ltd [1989] 1 WLR 902, where the Court of Appeal held that a stay of proceedings is not equivalent to a dismissal or discontinuance and therefore that an action in which all further proceedings have been stayed, even if by consent of all parties after a settlement, remains in being. See in particular per Neill LJ at 909H to 910D and 911A C. He concluded that, for the sake of clarity and certainty, the word stay in an order should not be treated as a possible equivalent of a dismissal or discontinuance. Although the action cannot continue without an order of the court, nor can it, he said, be regarded as dead in the same way as an action which has been dismissed or discontinued by order. I agree. The reasoning in Rofa supports the conclusion that in circumstances in which the 2006 proceedings have been stayed and not dismissed or discontinued the court remains seised of them. It is not and could not be disputed that the court was seised of the proceedings in accordance with Article 30 when the claim form in the 2006 proceedings was issued. It is not suggested that the appellants failed to take any of the steps referred to in Article 30(1) or (2) which would have nullified that effect. The question is whether anything happened subsequently from which it can be inferred that the court was no longer seised. I would answer that question in the negative. Although Rofa was not a decision on the construction of the Regulation, the correct approach is to consider whether anything occurred which could lead to the conclusion that the approach adopted there should not be applied to the stay incorporated in the Tomlin Orders and, if not, whether there is anything which leads to the conclusion that the court is not still seised of the proceedings. I would answer both those questions in the negative. Although it is true that the CMI settlement agreements contained a provision that, on payment of the settlement sum, the parties would file a consent order dismissing the proceedings, no such consent order was made or filed. The LMI settlement agreement does not contain any such provision. In all these circumstances, I can see no sensible basis upon which it can be said that the English court is no longer seised of the proceedings. There remain significant disputes arising out of the settlement agreements and the insurances. The second point taken on behalf of the respondents under this head is that, even if the original action is still alive, the claims now brought are new claims, which should be equated with, or treated as, new proceedings. They rely upon this dictum of Rix LJ in Stribog at para 129: Seventhly, there is nothing in the ECJ or English jurisprudence to support the judges approach in this case. It is possible that the introduction of entirely new causes of action or parties is to be recognised as the bringing of entirely new proceedings, so that the timing of seisin (the article 30 question) has to be looked at from that point of view, as occurs for the purposes of article 27. Even so, it is not clear to me that in this connection article 27 and article 28 work in the same way: for article 27 is worded in terms of the bringing of actions with the same parties and the same cause of action (Where proceedings are brought in the courts) whereas article 28 is worded in terms of the pendency of related actions (Where related actions are pending in the court) (emphasis added). That emphasises that the article 28 question is asked with relation to pending actions, and not, as the article 27 question is asked, with relation to the bringing of actions. In any event, the judge is in my respectful judgment mistaken to think that any amendment is analogous to the bringing of new causes of action or the addition or substitution of new parties. For my part, I would not accept that approach as applied to Article 28. In para 68 above I referred to the statement of Rix LJ at para 84 of Stribog. In para 63 of his judgment in the instant case Longmore LJ quoted para 84, where Rix LJ said that, where proceedings are amended to add new claims, the court is only seised of the relevant proceedings so far as the new claims are concerned at the time of the amendment. Immediately after the quote, Longmore LJ correctly pointed out that those observations were made in relation to Article 27 and not Article 28. He then quoted the second sentence from the above quotation from para 129 of Rix LJs judgment. Longmore LJ then asked whether this tentative expression of view in relation to "the introduction of entirely new causes of action" being tantamount to "the bringing of entirely new proceedings" means, for the purpose of this case, that the Greek courts are to be regarded as first seised of the relevant related action? He said at para 64 that, in his opinion it did not. He gave two reasons. He said that in the first place Rix LJ had already quoted the passage from the judgment of Saville LJ in The Happy Fellow which I set out in para 66 above. At para 65 Longmore LJ said that, in the second place, Rix LJ provided his tentative response to his tentative view in the remainder of paragraph 129 which he then quoted. That response is to my mind telling. Longmore LJ then expressed his conclusion at para 66. He expressed doubt about Rix LJs distinction between entirely new causes of action as opposed to partially new causes of action. However that may be, his conclusion seems to me to be contained in the last two sentences of para 66: As Saville LJ said in The Happy Fellow it is a misreading of Article 28 to ask which court is first seised of issues; it must likewise be wrong in an Article 28 context to ask which court is first seised of causes of action. That is Article 27 territory because, for the purpose of Article 28, one has to ask which court is first seised of an action, not a cause of action and, still less, an issue. On that basis Longmore LJ concluded at para 67 that, if the original English action and the subsequent Greek actions are related, as he concluded they are, it was the English court that was the court first seised. I agree. First, the contrary view seems to me to be inconsistent with the two stage approach to Article 28 adopted in Stribog. As Longmore LJ observed at para 66, in the context of Article 28 it is wrong in principle to ask which court is first seised of a cause of action, because Article 28 is concerned with related actions as a whole. Secondly, I would accept the appellants submission that on the facts of this case the claims now brought are not (as Rix LJ put it) entirely new. On the contrary, applying the broad and common sense approach favoured by Lord Saville in Sarrio, the claims now brought by the appellants are unquestionably related to the original action within the meaning of Article 28. I would only add in conclusion that it seems to me that it would be very odd indeed if a court which is seised of proceedings and stays those proceedings by way of a Tomlin order on the express terms that it retains jurisdiction to take further steps by way of implementation or policing of the order were prevented from exercising that jurisdiction, either by lifting the stay or otherwise, on the ground that it was no longer seised of the proceedings. It seems to me to be at least arguable that those steps should properly be treated as part of the existing proceedings. They might perhaps be treated as part of the same procedural unit as discussed by the CJEU in Purrucker v Vallz Prez (No 2) (Case C 296/10) [2011] Fam 312 at para 80. The case was on very different facts but was concerned with two paragraphs in a regulation which were identical to Articles 27 and 30 of the Regulation. In any event to treat the enforcement action as something entirely new seems to me to be wrong. It is never easy to decide what is an entirely new claim, what is a new claim and what is an expansion of an old claim. These claims are not new or entirely new because they are brought by way of enforcement of the outcome of the original dispute, in the same way as execution on a money judgment. In these circumstances it makes sense to hold that these claims, which largely arise out of the settlement agreements, arise out of the attempts made by the respondents to avoid the effect of those agreements and, in particular, the exclusive jurisdiction agreements. This solution would, as I see it, be consistent with the overall policy of the Regulation to avoid a multiplicity of proceedings. However, I can see that there is scope for argument under this head and, if the issue of first seised were critical to the decision, it might be appropriate to refer an appropriate question to the CJEU. I therefore turn to the issue of discretion on the assumption that the English court is second seised for the purposes of Article 28. Discretion On that assumption, the question arises whether the action or actions should be stayed as a matter of discretion. The judge held that no such stay should be granted. Given that the shape of the case has changed considerably since the matter was before the judge, it appears to me that this Court should consider for itself whether to grant a stay. I have reached the clear conclusion that it should not. I have reached that conclusion essentially for the reasons advanced on behalf of the appellants. They may be summarised in this way. In Owens Bank Ltd v Bracco (Case C 129/92) [1994] QB 509, at paras 74 79, Advocate General Lenz identified a number of factors which he thought were relevant to the exercise of the discretion. They can I think briefly be summarised in this way. The circumstances of each case are of particular importance but the aim of Article 28 is to avoid parallel proceedings and conflicting decisions. In a case of doubt it would be appropriate to grant a stay. Indeed, he appears to have approved the proposition that there is a strong presumption in favour of a stay. However, he identified three particular factors as being of importance: (1) the extent of the relatedness between the actions and the risk of mutually irreconcilable decisions; (2) the stage reached in each set of proceedings; and (3) the proximity of the courts to the subject matter of the case. In conclusion the Advocate General said at para 79 that it goes without saying that in the exercise of the discretion regard may be had to the question of which court is in the best position to decide a given question. On the facts here those questions can be considered together. As I see it, the issues are not dissimilar from those considered by Cooke J in Primacom at para 65, where he said this: Even if I had found that these two sets of proceedings and the German proceedings were related within the meaning of article 28, 'the strong presumption' which 'lies in favour of the applicant' on an application for a stay would be overridden here by virtue of the terms of the SSFA. Although the ECJ decision in Gasser means that a stay is mandatory where article 27 applies, there is no reason why weight should be given to that decision in the context of article 28, where a discretion is given to the court, the jurisdiction of which has been agreed by the parties as exclusive. It is nothing to the point that an English court could not have issued an anti suit injunction to prevent the German proceedings (as per C 159/02 Turner v Grovit [[2005] 1 AC 101]). The injustice of giving precedence to proceedings brought in breach of an exclusive jurisdiction clause where the parties have agreed that England is the appropriate forum is self evident. To breach the clause and to gain the benefit of priority for the German courts by such breach offends justice, where the court has a discretionary decision to make. In my opinion, similar considerations apply here. Although the true construction of the settlement agreements and the question whether Starlight and OME are in breach of them is ultimately a matter for the court which finally determines the summary judgment application or for the court at trial, there is a strong argument (to put it no higher) that the Greek proceedings have been brought by Starlight and OME in breach of the settlement agreements, which are subject to the exclusive jurisdiction of the English courts and/or in breach of the exclusive jurisdiction clauses in the insurance contracts. I would reject the submission that those considerations are impermissible in the light of the decision in Gasser. It was there held that, if the criteria for ordering a mandatory stay under Article 27 are satisfied, then the court second seised must stay its proceedings even if the court second seised has jurisdiction under an exclusive jurisdiction clause falling within Article 23. That conclusion was reached on the basis that, under Article 27, where there are two sets of proceedings which involve the same cause of action and the same parties, the court second seised is obliged to order a stay. The Regulation only permits one set of proceedings to continue. The position is quite different under Article 28, which clearly contemplates that where there are two related sets of proceedings they may proceed in parallel. That conclusion follows from the proposition that the grant of a stay is discretionary and not mandatory. In these circumstances, I can see no reason why, in exercising that discretion under Article 28, the court second seised should not take into account the fact that the parties had previously agreed (or arguably agreed) an exclusive jurisdiction clause in favour of that court. On the contrary, depending upon the circumstances of the particular case, that seems to me to be likely to be a powerful factor in support of refusal of a stay. After all, Recital 14 expressly provides: The autonomy of the parties to a contract, other than an insurance, consumer or employment contract, where only limited autonomy to determine the courts having jurisdiction is allowed, must be respected subject to the exclusive grounds of jurisdiction laid down in this Regulation. There is a close relationship between the claims in England and the subject matter of the claims in Greece. The natural court to consider the issues raised by the CMI and the LMI is the High Court in England because they raise contractual questions governed by English law and because it is at least arguable that the parties have agreed that they should be decided by the High Court, where the proceedings are more advanced than in Greece. After all, the judge granted summary judgment as long ago as December 2011. The court in Greece will then have the benefit of the decision of the court which, in the Advocate Generals language, is in the best position to decide these issues. Once there is a final judgment of the English courts, it will be recognisable in Greece, as elsewhere in the EU and will assist the Greek court. In this way, the principles of mutual trust upon which the Regulation is founded will be respected and there will be no risk of irreconcilable judgments. In these circumstances I would uphold the decision of the judge in refusing a stay under Article 28. There is no need for a reference to the CJEU because the question I would have referred does not arise given my conclusion on the exercise of discretion. It was at one time suggested that there is a referable question as to whether Article 28 gives the court second seised a choice between staying the proceedings under Article 28(1) and declining jurisdiction under Article 28(2). However, that suggestion was abandoned before the hearing. I would in any event have rejected it as unarguable. There is no support whatever for it in the language of Article 28 and none of the sources referred to supports the conclusion. The discretion is to stay or not to stay under Article 28(1) and to decline or not to decline jurisdiction under Article 28(2). The Court may thus both refuse to stay and refuse to decline jurisdiction. As the Advocate General explained in Bracco, all depends upon the circumstances. Too late? The remaining question is whether the Court of Appeal was wrong to reject submissions made on behalf of the appellants that it was too late for the respondents to rely upon Article 27. This is another part of the case where the facts seem to me to be startling. The appeal on this point is brought by the LMI and not the CMI but it is I think accepted that, if the appeal succeeds, the CMI will be able to take advantage of it. The most important point raised by this part of the appeal is whether the courts had a discretion to hold that the LMI should not be permitted to rely upon various procedural acts and omissions on the part of the respondents in response to their attempt at a late stage to rely upon Article 27 of the Regulation or whether, once the point was brought to its attention, the Court of Appeal was bound to consider Article 27 (as quoted at para 24 above) because it expressly provides that, where the conditions are satisfied any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established. I have reached the conclusion that the answer is that the appellants were entitled to rely upon the acts or omissions of the respondents and that, having regard to what had happened before Judge Mackie QC and the judge, the Court of Appeal was not bound to take the point of its own motion. Moreover, subject to a possible reference, I would hold that the Court of Appeal should have considered the acts or omissions of the respondents and have held that it was too late for the respondents to rely upon Article 27. The question of the scope of the Court of Appeals duty to take the point of its own motion in circumstances of this kind is however an important point on the construction of Article 27 and, if it were necessary for the determination of the appeal, I would refer it to the CJEU. However, if the LMI abandon their claim or claims for a declaration of non liability a reference will not be necessary for the determination of the appeal. If they do not, my present view is that it will. The relevant chronology, which I take from the Statement of Facts and Issues, is briefly as follows. I will omit references to the CMI proceedings, in which the applications were heard at the same time as those in the LMI proceedings. By application notice dated 3 August 2011, the LMI applied for wide ranging relief against Starlight to enforce the LMI settlement agreement. By application notice dated 18 August 2011 the LMI sought permission to join OME and to serve OME out of the jurisdiction. As explained earlier, the LMI commenced 2011 Folio 702 against Starlight and OME in order to enforce the LMI settlement agreement. They also commenced 2011 Folio 1043 only against the co assureds, which was an action founded solely on the exclusive jurisdiction clause in the policies. On 20 September 2011 the LMI obtained permission from Judge Mackie QC to issue a Part 20 claim against OME in 2006 Folio 815 and, lest it be needed, to serve that Part 20 claim form and the claim forms in 2011 Folios 702 and 1043 out of the jurisdiction and to serve them on Lax & Co in London. The applications were supported by a witness statement by their solicitor, Mr Zavos, in which he referred both to possible stays under Article 27 and Article 28 giving reasons why stays should not be granted. The orders gave notice to each of Starlight, OME and the co assureds that: You may apply within seven days after the date of service of this Order on you to have the Order set aside or varied. This time limit does not apply to an application to dispute the jurisdiction of the Court in respect of which the procedure in CPR Part 11 as modified by CPR Part 58 applies No such application was made. Starlight did not serve evidence within the time provided in the CPR. However, on 4 November 2011 they served evidence which included an express request by Mr Crampton of Lax & Co that the relief sought by the appellants on the merits be denied, alternatively that the matter be referred to a full trial, with provision for disclosure and exchange of witness and expert evidence. On 7 November Starlight, OME and the co assureds each filed a defence on the merits in the relevant action, having first obtained an extension of time for doing so. Each of the defences included a paragraph which stated: The claims in the Greek Proceedings fall outside the jurisdiction clause in the policy and the jurisdiction clause in the Settlement Agreement. It is respectfully denied therefore that the High Court of Justice of England and Wales has jurisdiction to determine the claims in the Greek Proceedings The grounds on which Starlight, OME and the co assureds opposed the appellants claims and applications for summary relief, were in summary that the claims brought in the Greek proceedings (1) did not fall within the scope of the releases contained in the LMI settlement agreement or the CMI settlement agreement; (2) did not fall within the scope of the indemnities contained in the settlement agreements; and (3) did not fall within the scope of the jurisdiction clauses contained in the settlement agreements or in the policies. Following service of the defences, the LMI applied for summary judgment in all the actions and all the applications were fixed to be heard on 28 and 29 November at the same time as the application for summary relief against Starlight in the 2006 proceedings. In their skeleton argument prepared for those hearings, which were served on 23 November 2011, the LMI included the following: 71. There has been no application for a mandatory stay under Article 27 of the Judgments Regulation in respect of the [LMIs] claims to enforce the jurisdiction clause in the contract of insurance, and to enforce the terms of the [LMI] Settlement Agreement. This is (no doubt) because the claims are different claims from the claims advanced by the Assureds in Greece. On 25 November 2011, Starlight, OME, and the co assureds, through their former counsel, James Drake QC and Emma Hilliard, provided their skeleton argument to the court, which expressly disavowed any application under Article 27, in these terms: 69. It is well established that in order for Article 27 to operate there must, when comparing the two sets of proceedings in issue, be three identities: of parties, of cause, and of objet: see generally Briggs & Rees, Civil Jurisdiction and Judgments (5th ed 2009) at paras 2 227 to 2 231. 70. Starlight does not here contend that there is here an identity of cause and objet between the Greek proceedings and the Insurers applications. Although designed to preclude in so far as possible, and from the outset a clash of verdicts, the operation of Article 27 (as distinct from Article 28) is highly restricted in its actual operation. Comparison must be made between the claims made in the two actions, regardless of possible defences, to see whether they proceed on essentially the same facts and under the same rule of law. In the footnotes they referred to the cases I have discussed earlier, including Gubisch, Gantner and The Tatry. It is thus plain that before the matter came before the judge the respondents had made a clear and reasoned decision not to rely upon Article 27. Moreover, there is no reason to think that the judge did not consider the points they made and accept them. They relied only on Article 28. They did so pursuant to an application made by application notice dated 24 November 2011. However that application was out of time. So, by further application notices in each action dated 28 November 2011, the respondents applied for permission to make the Article 28 application out of time, and for relief from sanctions pursuant to CPR Part 3. The sanction referred to was that imposed by CPR Part 11, which provides that a defendant who files an acknowledgment of service and fails to apply to the court within the time allowed under the CPR for an order declaring that it has no jurisdiction or should not exercise any jurisdiction which it may have, is to be treated as having accepted that the court has jurisdiction to try the claim: CPR rule 11(5). As stated in para 19 above, the judge dismissed the stay application under Article 28 and held that the appellants were entitled to summary judgment. He held that (1) each of the claims made by Starlight, OME, and the co assureds against the appellants in Greece is in breach of the exclusive English jurisdiction agreement in the policies; (2) each of the claims made by Starlight and OME against the appellants in Greece is in breach of the jurisdiction agreements in the settlement agreements which provide for exclusive English jurisdiction; (3) each of the claims made by Starlight and OME against the appellants in Greece is in breach of the terms of the settlement agreements; (4) each of Starlight, OME and the co assureds is liable in damages to the insurers for breach of contract and under Section 50 of the Senior Courts Act 1981; and (5) each of Starlight and OME is bound to indemnify and hold the insurers harmless against each of the claims in the Greek proceedings pursuant to the indemnities in the settlement agreements. The judge handed down his judgment on 19 December 2011 and fixed 2 February 2012 for the hearing of consequential applications. In the meantime, on 7 December 2011 Thomas Cooper had replaced Lax & Co as the respondents solicitors. On 24 January 2012 draft grounds of appeal were served which included for the first time reliance on Article 27. They were considered in a somewhat amended form by the judge. The judge granted permission to appeal on a number of grounds including the Article 27 point. As to that he said that he would not have given permission on that point alone, as he put it, not least because the Article 27 case could become the subject of an independent application at first instance at any time hereafter. He recognised that this would have the effect of turning the Court of Appeal into a first instance court but concluded that it could be argued without the need for further evidence and without a great addition of time. In the Court of Appeal the appellants relied upon the provisions of CPR Part 11, but the Court of Appeal held that it did not apply because applications under Articles 27 and 28 are not challenges to the jurisdiction. It further held that it was bound to take the Article 27 point of its own motion. The LMI say that the Court of Appeal was wrong on both points. CPR Part 11 provides, so far as relevant as follows: (1) A defendant who wishes to (a) dispute the court's jurisdiction to try the claim; or (b) argue that the court should not exercise its jurisdiction, may apply to the court for an order declaring that it has no such jurisdiction or; should not exercise any jurisdiction which it may have. (2) A defendant who wishes to make such an application must first file an acknowledgment of service in accordance with Part 10. (3) A defendant who files an acknowledgment of service does not, by doing so, lose any right that he may have to dispute the courts jurisdiction. (4) An application under this rule must (a) be made within 14 days after filing an acknowledgment of service; and (b) be supported by evidence. (5) If the defendant (a) files an acknowledgment of service; and (b) does not make such an application within the period specified in paragraph (4), he is to be treated as having accepted that the court has jurisdiction to try the claim. (6) An order containing a declaration that the court has no jurisdiction or will not exercise its jurisdiction may also make further provision including (a) setting aside the claim form; (b) setting aside service of the claim form; (c) discharging any order made before the claim was commenced or before the claim form was served; and (d) staying the proceedings. In an action in the Commercial Court such as this CPR 11(4) is varied by CPR 58.7(2) so that the application under CPR 11(1) must be made within 28 days after filing an acknowledgment of service and not 14 days. As I understand it acknowledgments of service were filed in each case. The position under CPR Part 11 is different from the position under the former Rules of the Supreme Court, under which the equivalent rule, namely RSC Order 12 rule 8(1), did not include an application for a stay. By contrast CPR 11(1)(b) applies to an application for an order that the court should not exercise its jurisdiction. An application for a stay is precisely that. An application for a stay under Article 27 is thus an application within CPR 11(1)(b). The applicant must file an acknowledgment of service and must make an application within 28 days. The respondents did not do that. Nor did they seek an extension of time to so do within the CPR. It is arguable that the effect of CPR 11(5) is that their failure to do so means that they are treated as accepting that the court both has jurisdiction and that it is free to exercise it. The difficulty is that the wording of paragraph (5) may only relate to the existence of the jurisdiction rather than the exercise of it. This point was left open in Texan Management Ltd v Pacific Electric Wire & Cable Company Ltd [2009] UKPC 46 at paras 68 and 69. However that may be, the LMI rely upon the voluntary submission to the jurisdiction evidenced by the acknowledgment of service and the service of a defence. They also rely upon the clear and unequivocal statement of the respondents position in their skeleton argument before the judge. It is plain from the terms of the concession quoted at para 106 above that serious thought had been given to the question both of whether to make the concession and of the basis on which it was to be made. In these circumstances, unless there is some rule of European law to the contrary, it appears to me that the Court of Appeal should have considered whether, in the exercise of their discretion to permit argument on a new point, they should exercise that discretion in favour of the respondents or not. Moreover, it appears to me that, given the clear basis on which the concession was made and, given that the judgment had proceeded on that basis, the Court of Appeal should have held that it had a discretion under CPR rule 11(1) to permit an application under the rule to be made out of time but should have refused to exercise it. However it is said that on the true construction of Article 27, the court, including on these facts the Court of Appeal, has a duty to consider the application of Article 27 of its own motion whenever the point is taken. This strikes me as extremely improbable. I would accept the submissions of the LMI in this respect. The CJEU has recognised the importance of national rules of procedure. Thus, for example, in Shevill v Presse Alliance SA (Case C 69/93) [1995] 2 AC 18 the CJEU said: 35. the object of the [Brussels] Convention is not to unify the rules of substantive law and of procedure of the different contracting states, but to determine which court has jurisdiction in disputes relating to civil and commercial matters in relations between the contracting states and to facilitate the enforcement of judgments: see Kongress Agentur Hagen G.m.b.H vs Zeehaghe B.V. (Case C 365/88) [1990] E.C.R. 1 1845, 1865, para. 17. 36. Moreover, the court has consistently held that, as regards procedural rules, reference must be made to the national rules applicable by the national court, provided that the application of those rules does not impair the effectiveness of the Convention: paragraphs 19 and 20 of [Kongress Agentur Hagen G.m.b.H. vs Zeehaghe B.V. (Case C 365/88) [1990] E.C.R. 1 1845]." I would accept the LMIs submission that Article 27 is part of European law and overrides national law which is incompatible with it. It does not however follow from this proposition that English procedural rules were overridden. A national procedural rule must not impair the effectiveness of Article 27. It must not render the exercise of rights conferred by EU law impossible or excessively difficult: Amministrazione delle Finanze dello Stato v SpA San Giorgio (Case 199/82) [1983] ECR 3595, [1985] 2 CMLR 658. This is the principle of effectiveness, which involves considering whether the rule can operate consistently with Article 27, or whether it is incompatible with it. The procedural rule should not be less favourable than those governing similar domestic actions, which is the principle of equivalence: see eg Interfact Ltd v Liverpool City Council [2011] QB 744, Kapferer v Schlank and Schlick GmbH (Case C 234/04) [2006] ECR I 2585 at paras 19 to 22, Kbler v Austria (Case C 224/01) [2004] QB 848; and Eco Swiss China Time Ltd v Benetton International NV (Case C 126/97) [1999] ECR I 3055. I refer only to Interfact, where the Court of Appeal refused to exercise its discretion to allow cases to be reopened under CPR 52.17, so as to give a remedy for infringement of a provision of European law. Lord Judge CJ, delivering the judgment of the Court of Appeal, said : 41 In general, EU law does not require national courts to disapply their own procedural rules in order to secure the vindication of EU rights. In Kapferer v Schlank & Schick GmbH the Austrian Supreme Court was seised of an appeal in which the respondent had failed to lodge within the time stipulated a respondent's notice taking a point on jurisdiction under the Brussels Convention. The court referred to the Court of Justice the questions whether it was, nevertheless, bound to take the point of EU law of its own motion and whether EU law required a national court to review and set aside a final judicial decision in circumstances where it later became apparent that the decision of the court was in breach of EU law. The Court of Justice held that a national court is not so bound 44 . [Kapferer] establishes as a matter of general principle that EU law does not require a national court to reopen a final judicial decision, even if failure to do so would make it impossible to remedy an infringement of a provision of EU law: see the Kapferer case, at para 21; Amministrazione dell'Economia e delle Finanze and Agenzia delle Entrate v Fallimento Olimpiclub Srl (Case C 2/08) [2009] ECR I 7501, para 23; Asturcom Telecommunicaciones SL v Rodrguez Nogueira (Case C 40/08) [2010] 1 CMLR 865 para 37. 49. The Court of Justice has upheld national time limits and limitation periods on grounds of legal certainty and the need to ensure finality in decision making, even though the effect has been to preclude enforcement of an EU law right: see, for example, Palmisani v Istituto Nazionale della Previdenza Sociale (INPS) (Case C 261/95) [1997] ECR I 4025; Fantask A/S v Industriministeriet (Ehrvervsministeriet) (Case C 188/95) [1997] ECR 1 6783. Finally, I would accept these submissions made by the LMI. Under English law a final judgment on the merits should not be set aside without very solid grounds: Brown v Dean [1910] AC 373 at 374, per Lord Loreburn. Interest republicae ut sit finis litium. This is part of the common tradition of the legal systems of the Member States: Rewe Zentralfinanz eG and Rewe Zentral AG v Landwirtschaftskammer fr das Saarland (Case C 33/76) [1976] E.C.R. 1989. As quoted above, in Interfact the Court of Appeal rejected the argument that, where an appellate court has a discretion to exercise under national procedural law to allow a final judgment to be challenged on appeal, it must exercise that discretion so as to remedy the infringement of EU law. In my judgment, there is no sensible basis upon which it can be said that the time limit under CPR 11(4), which can in an appropriate case be extended under CPR 3.1(2)(a), is contrary to EU law. The time limit satisfies the principle of equivalence because it is the same rule that applies in all cases. It fulfils a legitimate aim, namely making sure that points going to whether the proceedings are to be tried on their substantive merits in England are taken promptly and without unnecessary costs. It satisfies the principle of legal certainty because parties need to know where they stand. The absence of a time limit would allow a litigant to take the point years afterwards. Moreover, the time limit does not render the right to apply for a stay under Article 27 (or Article 28) impossible or excessively difficult to exercise. It allows sufficient time for the point to be raised, especially given the express rule permitting an extension of time in appropriate cases. As to the expression of its own motion in Article 27, there are a number of different parts of the Regulation that have a similar provision. On the facts here the potential for a stay under Article 27 was before the courts on at least two occasions. The position was explained to Judge Mackie QC on the without notice application referred to above. There is no reason to think that he did not give consideration to the position. More importantly perhaps the position was explained to the judge in the skeleton arguments to which I have referred. He was given both reasons and authority on the question whether a stay should be granted under Article 27. It seems to me that the judge was entitled to accept those submissions, which were made on the respondents behalf by experienced counsel and solicitors. For these reasons I would hold that the Court of Appeal should have refused to allow the respondents to rely upon Article 27 in the Court of Appeal. That said, I would accept that the meaning and effect of the duty to consider Article 27 of its own motion are matters of some potential importance and I have (somewhat reluctantly) reached the conclusion that they are not acte clair. I would therefore refer an appropriate question to the CJEU if it were necessary in order to resolve the appeal. If the appellants abandon the claims to the declarations referred to in paras 58 and 59 above, such a reference will not be necessary because, for the reasons given above, I would allow the appeals under Article 27 in their entirety. It seems to me that rather different considerations apply to Article 28 and that the Court of Appeal were entitled to consider Article 28 as part of the appeal from the decision of the judge who had considered it in detail. CONCLUSIONS For these reasons I would invite the CMI and the LMI to consider whether they wish to pursue their claims for declarations (referred to in paras 58 and 59 above) that the Greek claims fall within the terms of the release in the settlement agreements or that under the agreements the tort claims have been settled. As Lord Neuberger observes, those are the claims described in para 18(a)(1)(i), 18(a)(2)(i) and 18(b)(i) above. They should indicate their position within 14 days of this judgment being handed down. If they persist in their claims, some limited questions should be referred to the CJEU as described above. The decision whether to stay those claims would then await the result of the reference, although I would allow the appeal under Article 27 in respect of the other claims. If they abandon them, I would allow all the appeals of both the CMI and the LMI under Article 27. I would in any event dismiss the respondents cross appeal under Article 28 and I would hold that their application for a stay under Article 28 should be refused as a matter of discretion. The parties should make written submissions on the form of order and costs within 21 days of the handing down of this judgment. Finally, I would like to thank all counsel and solicitors for their assistance in this unusual and in some respects difficult case. LORD NEUBERGER Subject to one point, I entirely agree with Lord Clarkes reasoning and conclusions. The one point concerns the issue discussed in paras 44 46 and 58 59 of Lord Clarkes judgment and in Lord Mances judgment. That issue is whether (i) LMIs claim in England for a declaration that the Greek claims have been settled, and (ii) CMIs claim in England for a declaration that the Greek claims were compromised (the English declaration claims, described in para 18(a)(1)(i), 18(a)(2)(i) and 18(b)(i) of Lord Clarkes judgment) should be stayed under Article 27. In my view, if that issue remains live, it should be referred to the CJEU, as I do not regard it as acte clair. I see the force of Lord Clarkes view that the English declaration claims do not have le mme objet et la mme cause, if one gives that expression a very narrow effect. I also accept that, particularly in the light of the existence of Article 28, there is good reason to give Article 27 a relatively narrow meaning, as Rix J pointed out in Glencore International AG v Shell International Trading and Shipping Co Ltd [1999] 2 Lloyds Rep 692, 697. I also accept that the decisions of the CJEU cited by Lord Clarke at paras 26 28 of his judgment support the contention that Article 27 has a relatively narrow ambit of application. However, it is also important to appreciate that the fundamental purpose of Article 27, as explained by the CJEU, is to ensure that judgments obtained in one member state are enforceable in other member states, and that the consequence of this is that one should avoid mutually inconsistent judgments. The purpose of Article 27 is to help achieve that end. It seems to me that, if the Greek court were to give Starlight and OME judgment for a particular sum in respect of its Greek claims, and the English court were to give judgment in favour of LMI and CMI in the form of a declaration that those very claims have been settled or compromised, the two judgments would be incompatible as a matter of principle and logic. It is not possible for a court to award a claimant damages in respect of a claim which has been compromised with the defendant. To put the point another way, to say that a defendant currently owes a claimant damages in respect of a claim which the defendant has settled or compromised with the claimant involves an illogicality. Accordingly, it seems to me that there is a real case for saying that the English declaration claims should be stayed. The difference between the English declaration claims and CMIs and LMIs claims in England for an indemnity and damages for breach of the settlement agreements (the English indemnity and damages claims, as described in paras 18(a)(1)(iii), (v) and (vi), 18(a)(2)(iii) and (iv) and 18(b)(ii), (iii) and (iv) of Lord Clarkes judgment) may appear to be relatively small, but I believe that there is a crucial distinction, as a result of which it is acte clair that the English damages and indemnity claims do not fall foul of Article 27. The crucial difference is that, if those claims were successful, they could not lead to inconsistent judgments in England and Greece. I accept that, if they were successful, the English indemnity and damages claims could be fairly said to neutralise, at any rate in commercial terms, any benefit to Starlight and OME of a judgment in the Greek claims. However, crucially in my view, success for LMI and CMI in the English indemnity and damages claims would not be logically inconsistent in any way with success for Starlight in the Greek claims. It is not inconsistent (although it is commercially pointless) to say that a defendant is liable to pay a claimant a sum by way of damages, while the claimant is bound to indemnify the defendant in respect of the whole of that sum (or is bound to pay an equivalent sum to the defendant). Indeed, the indemnity is not merely logically consistent with the liability: it is positively meaningless without the liability for damages, and the liability for damages, though rendered nugatory by the indemnity, is not logically inconsistent with the indemnity. LORD MANCE General I am in substantial but not complete agreement with the reasoning and conclusions reached in the course of the judgment prepared by Lord Clarke, although, ultimately, as will appear, we agree on the proper disposition of these appeals. The differences between Lord Clarke and myself relate to the significance and operation of article 27 of the Council Regulation (EC) No 44/2001 (the Brussels Regulation) with regard to the respondents Greek claims. I have no difficulty in agreeing with Lord Clarkes conclusions regarding the English claims made by CMI and LMI for damages for (i) breach of the exclusive jurisdiction clauses in the Settlement Agreements and insurance policies and (ii) indemnity under clauses 3 and 4 of the respective Settlement Agreements. Such claims do not assert that there is no tort liability because of the Settlement Agreements. They assert (i) that the respondents are claiming in the wrong jurisdiction and (ii) that the respondents have agreed to indemnify them in respect of any tort claims (valid or not) by the respondents themselves as well as by others arising from the loss of the vessel. However, I do not accept the reasoning by which Lord Clarke reaches his conclusions with regard to these claims for damages and the further release claims (as Lord Clarke conveniently calls them) which he addresses in paras 40 to 59 of his judgment. This difference becomes important in relation to the first head of the release claims, as I shall show. One strand of Lord Clarkes reasoning is that the English claims based on the Settlement Agreements cannot be the mirror image of the Greek tort claims, because they involve contract and tort claims and cannot constitute the same cause of action: para 34, third sentence, para 41, second and third sentences and para 43, second and last sentences. Another strand is that it is relevant or conclusive that the English and Greek claims do not interfere with each other, and, in particular, that the Greek claims do not impugn the settlement agreements: para 35, first and second sentences and para 37, in its entirety. Neither of these strands of reasoning is in my opinion sustainable, for reasons which I will explain. The release claims The release claims need a little analysis. There are three heads. The first head is summarised by the respondents themselves and by Lord Clarke (para 18(a)) as involving claims for declarations that the Greek claims fall within the terms of the release. But this head is in fact pleaded by LMI as a claim for a declaration that the Greek claims have been settled (application notice, para (1) 1 and 3), while CMI plead that the Greek claims were compromised (particulars of additional claim, para 10) and follow this with a claim for a declaration that the Greek claims fall within clause 2 of the CMI Settlement Agreement (particulars of additional claim, para 27(a)). These are clear statements (right or wrong as they may prove to be) that the Greek claims have been settled or compromised within the terms of the Settlement Agreements. The second and third heads are claims for a declaration that the bringing of the Greek claims was a breach of the release in each of the Settlement Agreements and for damages for such breach. They must stand or fall together. They raise different considerations from the first head. The first head of release claim The English claims that the Greek claims have been settled or were compromised are in my opinion mirror images of the Greek tort claims. The English pleas mean, and can only mean that the English claimants are not liable for the Greek tort claims. The legal effect of these English statements is (under English eyes and, I am confident, European law) that the Greek claims are no more. If an English court were to give a judgment to that effect, and there was no prior Greek judgment or other reason for non recognition, the Greek court ought under the Brussels Regulation to accept it. It cannot make any difference to the application of article 27 that the reason for non liability is a contractual settlement agreement. The only point of enforcing the contract is to show that there are no valid Greek tort claims. The Greek claims aim to enforce tort liabilities. The first head of the English claims aims to establish that there are no such valid tort liabilities, because they have been settled. The Greek and English claims cannot stand together. The concepts used in article 27 (such as cause of action or the concept of same object which one must read into the English text) are autonomous European concepts: Gubisch v Palumbo Case 144/86, [11] and The Tatry Case C 406/92, [47]. In the latter case, the European Court of Justice said that the cause of action comprises the facts and the rule of law relied on as the basis of the action and that the object of the action for the purposes of article [27] means the end the action has in view [39] [41]. An analysis of the cases helps to understand what was meant. Gubisch v Palumbo happened to concern a situation where the mirror image claims were in a general sense contractual. The German claim was for the price of machinery delivered. The later Italian claim by the buyer was, firstly, that there was no liability because he had revoked his offer before it had reached the seller for acceptance strictly, this was not a contractual claim, but a claim that there was no contract and, secondly, that, if there was a contract, his consent was vitiated and the contract should be set aside for mistake or on the ground of the sellers fraud, or, thirdly, that any contract had been discharged on account of the sellers late delivery. Both the question referred and the Court of Justices summary of the facts embraced all three aspects of the Italian claim: see e.g. judgment [2] and [4]. The subsequent reasoning and the answer given refer to mirror image claims, one seeking enforcement, the other seeking rescission or discharge, of a contract: see [13] and [15] and the Courts answer. The Court said [17] that it must be held that the two actions have the same subject matter, for that concept cannot be restricted so as to mean two claims which are entirely identical. The absence of express reference at these points to the first Italian claim (that no contract had ever been concluded) cannot mean that the Court was drawing any distinction between that claim and the other two. On the contrary, the inference is that it saw it as posing no different issue. It could not have made any difference to the Court of Justices conclusions if, instead of or in addition to some or all of the pleas actually made in the Italian proceedings, the Italian claimants had alleged that the contract had been rescinded or discharged under some separate subsequent agreement, whether, for example, by novation or by some compromise relating to the parties past dealings or outstanding issues. Nor, in a situation in which concurrent contract and tort claims are possible (see e.g. Henderson v Merrett Syndicates Ltd [1994] UKHL 5; [1995] 2 AC 145), could it be crucial to the application of article 27 whether the foreign claim was being pursued in contract or tort, when the later English claim asserted a settlement agreement wide enough to cover both. Lord Clarke cites at para 28(iii) a useful encapsulation by Cooke J in JP Morgan Europe Ltd v Primacom AG [2005] 2 Lloyds Rep 665, [42], of the meaning of the expression legal rule or rule of law which the Court of Justice used in The Tatry Case C 406/92, [39]. Cooke J suggested that, in investigating cause, it was necessary, after looking at the basic facts, to look at the basic claimed rights and obligations of the parties. Here, the basic claimed rights and obligations of the parties are, in Greece, that the English claimants are liable in tort, and, in England, under the first head which asserts that the Greek claims have been settled, that there is no or no further liability for the Greek claims. The way in which article 27 was applied in The Tatry is also of interest. Having said that the cause of action comprises the facts and the rule of law relied on as the basis of the action [39], the Court of Justice went on: 40 Consequently, an action for a declaration of non liability, such as that brought in the main proceedings in this case by the shipowners, and another action, such as that brought subsequently by the cargo owners on the basis of shipping contracts which are separate but in identical terms, concerning the same cargo transported in bulk and damaged in the same circumstances, have the same cause of action. Here, the English claim that the Greek claims fall within the release and have been settled or compromised concerns, and seeks to negative, the same tort claims as the Greek actions seek to enforce. It can make no difference that the Greek claimants have not sought, pre emptively, to refer to, address or impugn in their Greek claims a possible defence (the Settlement Agreements) that might be raised in the Greek proceedings. One would not expect them to do so, any more than the German claimants in Gubisch v Palumbo addressed or would be expected to address every or any of the multiple arguments that the Italian claimants later deployed. The fact that the English claims do not seek directly to interfere with the Greek claims is also irrelevant. It would anyway be impermissible to claim in England an injunction restraining the Greek proceedings, but, quite apart from that, article 27 and the principle in Gubisch v Palumbo do not depend upon one set of proceedings seeking directly to prevent another. They derive from the principle that Member States must recognise each others judgments, and the aim of avoiding inconsistent judgments. As to the same object, the end which the Greek and English proceedings have in view is the same in each case, to decide the issue of liability for the torts alleged in Greece. That this is what is meant by the same object is clear from both Gubisch v Palumbo and The Tatry. The matter is directly addressed in the latter case in paras 42 to 45: 42 The question accordingly arises whether two actions have the same object when the first seeks a declaration that the plaintiff is not liable for damage as claimed by the defendants, while the second, commenced subsequently by those defendants, seeks on the contrary to have the plaintiff in the first action held liable for causing loss and ordered to pay damages. 43 As to liability, the second action has the same object as the first, since the issue of liability is central to both actions. The fact that the plaintiff's pleadings are couched in negative terms in the first action whereas in the second action they are couched in positive terms by the defendant, who has become plaintiff, does not make the object of the dispute different. 44 As to damages, the pleas in the second action are the natural consequence of those relating to the finding of liability and thus do not alter the principal object of the action. Furthermore, the fact that a party seeks a declaration that he is not liable for loss implies that he disputes any obligation to pay damages. 45 In those circumstances, the answer to the fifth question is that, on a proper construction of Article 21 of the Convention, an action seeking to have the defendant held liable for causing loss and ordered to pay damages has the same cause of action and the same object as earlier proceedings brought by that defendant seeking a declaration that he is not liable for that loss. The reference in [44] to a partys claim for a declaration of non liability implying that it disputes any obligation to pay damages is equally applicable to the present English claims that the Greek tort claims fall within the release or have been settled or compromised. The English claims imply that the Greek claims are disputed. In short, the issue of liability is central to both the Greek and the English proceedings here, as it was to the Dutch and English proceedings in The Tatry. Not merely the same cause of action but also the same object is involved in the present case, as it was in The Tatry. The two sets of proceedings would, if pursued to judgment, lead to judgments which were legally and directly incompatible. It is therefore necessary under article 27 to consider whether it is the Greek or the English courts which fall in this connection to be regarded as first seised. The second and third heads of the release claims The second and third heads are more elusive. Claims for a declaration that the bringing of the Greek claims was a breach, and for damages for the breach, of the release in the Settlement Agreements may on one view be seen as little different from the claims made under the first head. But I have come to the conclusion that this would be wrong. The second and third heads postulate, and for present purposes at least we must accept, that the releases contain some positive continuing promise which the respondents by their Greek claims are now breaching. The terms of the releases were in each case (clause 2 in the case of CMI, clause 3 in the case of LMI) that the respondents would accept underwriters due proportion of the relevant payment in full and final settlement of all and any claims it may have under Policy no. against the Underwriters in relation to the loss of Alexandros T. One must make the assumption, for present purposes, that the Greek tort claims fall within this agreement. The difficulty is that the agreement was performed, in the sense that there was not merely an accord, but an accord and satisfaction. All policy claims were thus not just agreed to be settled, but they actually were settled, and, if and to the extent that that is the nature of the second and third heads of English release claim, they would not in reality differ from the first head. The question therefore arises, what if any outstanding promise could there be left to perform which the second and third heads claim to enforce? I have come to the conclusion that the acceptance of the sums paid in full and final settlement involves, certainly very arguably, a continuing outstanding promise not further to pursue claims of the nature identified in clauses 2 and 3 respectively. Even after the settlement, the pursuit of such claims could cause CMI and LMI loss. Most obviously, such loss could consist in the costs of defending the Greek claims. If they let the Greek proceedings go undefended, it could, subject to issues arising from the potential recognition of any Greek judgment under the Brussels Regulation, include the amount of any judgment awarded against them in the Greek proceedings. Likewise potentially, though subject to additional questions arising from any potential issue estoppel or application of the rule in Henderson v Henderson (1843) 3 Hare 100, even if they unsuccessfully defended the Greek claims. The consequences Accordingly, the second and third heads of release claims, analysed as I have analysed them, are outside the scope of article 27. As regards the first head, the remaining issue is whether the Greek or the English courts fall for the relevant purpose to be regarded as first seised. In so far as the first head of release claims was added into the pre existing English proceedings by an amendment made after the Greek proceedings were begun, is it to be viewed discretely as a new claim of which the English court is second seised? Or does it fall to be viewed as part, by amendment, of a single set of English proceedings commenced well before any Greek proceedings? I agree with Lord Clarke at para 60 that a court is only seised of claims by or against new parties from the date that those parties are added to the proceedings. In relation to the 2006 proceedings, the English court was only seised of claims against OME once OME was joined to the proceedings on 20 September 2011 and, as against OME therefore, the English courts were only seised of the first head of release claims made by CMI and LMI in 2011. Since the first head of release claims is in my opinion the mirror image of the Greek tort claims, article 27 must, on that basis, apply to preclude the pursuit of the first head of release claims as against OME in England. The respondents submit that article 27 also applies to preclude the pursuit in the English proceedings of the first head of claim against Starlight, which was party to the English proceedings from their outset. The Court of Appeal accepted this submission. CMI and LMI challenge it. Lord Clarke has in his paras 61 to 71 set out and discussed the respective submissions. To my mind, the sense of the Regulation as well as the case law and the academic guidance all point in one direction. The chronological priority contemplated by the Regulation cannot be gained, or subverted, by the addition by amendment of a new claim in proceedings otherwise second brought (any more than it can be affected by the addition of new claimants or defendants, as Lord Clarke accepts: para 60). To the authorities under the current Regulation to which Lord Clarke refers, I would only add that similar thinking is to be found under the predecessor provisions of Article 21 and 22 of the Brussels Convention in the decisions at both levels in Grupo Torras SA v Shekh Fahad Al Sabah [1995] 1 Lloyds Rep 374, 418 419 (Mance J) and [1996] 1 Lloyds Rep 7, 24 (CA). Conclusion It follows that the conclusions I would reach, were all the issues to be finally decided now, would be that: The first head of English release claims would be precluded under i) article 27, having regard to what I conclude are in this respect the prior Greek claims. ii) All the remaining heads are outside the scope of article 27 and are permissible. It is however necessary to consider whether these conclusions are founded on principles of European law which are so clear that no reference to the Court of Justice is required. A reference to the Court of Justice In relation to the conclusion expressed in para 161ii, we are all in agreement in our conclusions. Any differences in reasoning regarding article 27 are irrelevant, and no reference is necessary. As to para 161i, Lord Clarke would reach the opposite conclusion to that which I have expressed and he considers in the light of my judgment that a reference is called for, if the English appellants persist in their first head of release claims. With the latter view I agree. The differences between Lord Clarkes and my reasoning are not, I believe, simple differences regarding the application to facts of clear principles of European law. I might by myself have thought that all the relevant principles of European law were clear, but I certainly do not dissent from the proposition that the differences, being material to our respective conclusions, require a reference. If the appellants wish to persist in, rather than abandon, the first head of release claims, there should accordingly be a reference as Lord Clarke suggests. Ultimately, therefore, although by different reasoning, Lord Clarke and I arrive at the same conclusions regarding the appropriate disposition of these appeals.

On 3 May 2006, the vessel Alexandros T sank and became a total loss 300 miles south of Port Elizabeth with considerable loss of life. Her owners were Starlight Shipping Company (Starlight). Starlight made a claim against their insurers, who denied liability on the basis that the vessel was unseaworthy with the privity of Starlight. In response, Starlight made a number of serious allegations against their insurers including allegations of misconduct involving tampering with and bribing of witnesses. On 15 August 2006, Starlight issued proceedings in the Commercial Court against various insurers (the 2006 proceedings). One group of insurers was described as the Company Market Insurers (CMI) and the other group was described as the Lloyds Market Insurers (LMI). Before the hearing, the 2006 proceedings were settled between Starlight and the insurers and the proceedings were stayed by way of a Tomlin Order. In April 2011, nine sets of Greek proceedings, in materially identical form, were issued by Starlight although they were expressed as torts actionable in Greece. The insurers sought to enforce the earlier settlement agreements. Starlight applied for a stay of these proceedings, firstly pursuant to Article 28 then Article 27 of Council Regulation (EC) No 44/2001 (the Regulation) The judge refused to grant a stay under Article 28 and gave summary judgment to the insurers. The Court of Appeal held that it was bound to stay the 2006 proceedings under Article 27, which provides for a mandatory stay, and it was not therefore necessary to reach a final determination of the position under Article 28. Before the Supreme Court, the insurers challenge the correctness of the Court of Appeals conclusion under Article 27 and submit that the judge was correct to refuse a stay under Article 28. Starlight cross appeal on the Article 28 point. Subject to the possibility of a reference to the CJEU on some limited questions, the Supreme Court unanimously allows the CMIs and LMIs appeal. Lord Clarke gives the lead judgment, with which Lord Sumption and Lord Hughes agree. Lord Neuberger agrees adding a short judgment of his own. Lord Mance agrees with the result. Article 27 Article 27 must be construed in its context. The purpose of Article 27 is to prevent the courts of two Member States from giving inconsistent judgments and to preclude, so far as possible, the non recognition of a judgment on the ground that it is irreconcilable with a judgment given by the court of another Member State [23, 27]. In the case of each cause of action relied upon, it is necessary to consider whether the same cause of action is being relied upon in the Greek proceedings. In doing so, the defences advanced in each action must be disregarded [29]. The essential question is whether the claims in England and Greece are mirror images of each other and thus legally irreconcilable [30]. There are three heads of claim in England: indemnity, exclusive jurisdiction and release [32]. None of the causes of action relied upon in the Greek proceedings has identity of cause or identity of object with the CMIs claim for an indemnity. The subject matter of the claims is different. The Greek proceedings are claims in tort (or its Greek equivalent) and the claims in England are claims in contract. As to object, that of the Greek proceedings is to establish a liability under Greek law akin to tort, whereas the object of the CMIs claim is to establish a right to be indemnified in respect of such a liability and to claim damages for breach of the exclusive jurisdiction clauses [34]. The same is true of the CMIs claims in respect of the exclusive jurisdiction clauses in the settlement agreement and/or in the insurance policies [36]. The causes of action based upon an alleged breach of the settlement agreement are not the same causes of action as are advanced in Greece [37]. The same is also true of the claims based on the release provisions in the CMI settlement agreement [40]. The Greek claims are claims in tort and the English proceedings are contractual claims. The factual bases for the two claims are entirely different. Moreover, the object of the two claims is different [41]. The Supreme Court is unanimous that that is the position with regard to the claims for damages for breach of the release provisions in the settlement agreements. However, in so far as the insurers claim declarations, while the majority reaches the same conclusion, Lord Mance reaches a different conclusion on the basis that the claims for declarations in the two jurisdictions are mirror images of each other. The court unanimously decides that, unless the insurers abandon those claims for declarations, the relevant question should be referred to the CJEU for an opinion [59]. In the event, the CMI have now abandoned their claims for declarations based on the release provisions and it is not necessary to refer the question to the CJEU. It follows that the CMIs appeals under Article 27 are allowed. The position of the LMI is essentially the same as in the case of the CMI [55]. If the LMI do the same within the time permitted, their appeals will also be allowed under Article 27. A similar position has been reached in respect of LMIs submission that the appeals under Article 27 should have been rejected by the Court of Appeal as being too late [123]. Article 28 The discretion to stay claims under Article 28 is limited to any court other than the court first seised [74]. On the assumption that the English court is second seised for the purposes of Article 28, the question arises whether the actions should be stayed as a matter of discretion [91]. The circumstances of each case are of particular importance but the aim of Article 28 is to avoid parallel proceedings and conflicting decisions. In a case of doubt it would be appropriate to grant a stay [92]. However, the natural court to consider the issues raised by CMI and LMI is the High Court in England because they raise contractual questions governed by English law and because it is at least arguable that the parties have agreed that they should be decided by the High Court, where the proceedings are more advanced than in Greece [96]. The decision of the judge in refusing a stay under Article 28 is upheld and the cross appeal is dismissed [97, 125].

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Two appeals are before the Court by prisoners who were convicted of murder and sentenced to life imprisonment. In the case of the appellant Peter Chester, the tariff period fixed expired many years ago, but he has not yet satisfied the Parole Board that it is no longer necessary for the protection of the public that he should be confined. In the case of the appellant George McGeoch, the sentencing judge fixed a punishment part of 13 years which expired on 7 October 2011, but he has committed various intervening offences including violently escaping from lawful custody in 2008 for which he received a seven and a half year consecutive sentence. The result is that the earliest date on which McGeoch could be considered for parole is July 2015. Both the appellants claim that their rights have been and are being infringed by reason of their disenfranchisement from voting. Chesters claim for judicial review was issued in December 2008 and relates to voting in United Kingdom and European Parliamentary elections. It relies on Article 3 of Protocol No 1 (A3P1) as incorporated into domestic law by the Human Rights Act 1998 and directly on European Union law. Burton J and the Court of Appeal (Lord Neuberger MR, Laws and Carnwath LJJ), [2010] EWCA Civ 1439, [2011] 1 WLR 14346, dismissed Chesters claim. They held that it was not the courts role to sanction the government for continuing delay in implementing the European Court of Human Rights decision in Hirst v United Kingdom (No 2) (2005) 42 EHRR 849 or to repeat the declaration of incompatibility issued by the Scottish Registration Appeal Court in Smith v Scott 2007 SC 345 or issue advice as to the form which compatible legislation might take. They held that European Union law raises no separate issue. McGeochs claim for judicial review was issued in February 2011 and related to voting in local municipal and Scottish Parliamentary elections. It relies solely on European Union law. The Extra Division dismissed the petition on the ground that European Union law only conferred a right to vote in municipal elections in a Member State on European Union citizens residing in a Member State of which they were not nationals. It also considered that Scottish Parliamentary elections were not for this purpose municipal elections. Before the Extra Division McGeoch was refused permission to amend to include a complaint relating to voting in European Parliamentary elections, but a corresponding amendment was permitted by the Supreme Court by order of 15 October 2012. The following summarises my conclusions: (A) Human Rights Act In respect of Chesters claim under the Human Rights Act, which only relates to elections to the European and United Kingdom Parliaments (para 2), I would decline the Attorney Generals invitation to this Court not to apply the principles in Hirst v United Kingdom (No 2) (2005) 42 EHRR 849 (Hirst (No 2)) and Scoppola v Italy (No 3) (2012) 56 EHRR (paras 34 35) (Scoppola), but also decline to make any further declaration of incompatibility with the Convention rights (paras 39 42). (B) European law a. In respect of McGeochs and Chesters claims under European law, which can at most relate to elections to the European Parliament and municipal authorities (paras 9, 45 and 46), I conclude that European law does not incorporate any right to vote paralleling that recognised by the European Court of Human Rights in its case law or any other individual right to vote which is engaged or upon which, if engaged, they are able to rely (paras 46 47, 58, 59, 63 64 and 68). b. Had European law conferred any right to vote on which McGeoch and Chester can rely: i. the only relief that might have been considered would have been a generally phrased declaration that the legislative provisions governing eligibility to vote in European Parliamentary and municipal elections in the United Kingdom were inconsistent with European Community or Union law but that would not have appeared appropriate in the particular cases of Chester and McGeoch (para 72); ii. the general ban on voting in European Parliamentary and municipal elections could not have been disapplied as a whole (para 73); iii. it would not have been possible to read the RPA section 3 or EPEA section 8 compatibly with European law (para 74); iv. the Supreme Court could not itself devise a scheme or arrangements that would or might pass muster with European law; that would be for Parliament (para 74); vs neither of the appellants could have had any arguable claim for damages in respect of any breach of European law which may be involved in RPA section 3 and/or EPEA section 8 (paras 82 83). (C) European Court of Justice The resolution of these appeals does not necessitate a reference to the European Court of Justice. In so far as it raises issues of European law for determination, they are either not open to reasonable doubt or involve the application by this Court to the facts of established principles of European law (para 84). (D) Both appeals fall therefore, in my opinion, to be dismissed (para 85). Legislation Entitlement to vote in parliamentary and local government elections in the United Kingdom is governed by the Representation of the People Act 1983 (RPA). Section 1, as substituted by section 1 of the Representation of the People Act 2000, provides that: (1) A person is entitled to vote as an elector at a parliamentary election in any constituency if on the date of the poll he (a) is registered in the register of parliamentary electors for that constituency; (b) is not subject to any legal incapacity to vote (age apart); (c) is either a Commonwealth citizen or a citizen of the Republic of Ireland; and (d) is of voting age (that is, 18 years or over). Section 2 provides in similar terms in relation to local government elections, but with the addition in (c) of the words or a relevant citizen of the Union, to meet the requirements of what is now article 22(1) TFEU. Section 3 of the Act, as amended by section 24 of and paragraph 1 of Schedule 4 to the Representation of the People Act 1985, disenfranchises serving prisoners, providing: Disfranchisement of offenders in prison etc (1) A convicted person during the time that he is detained in a penal institution in pursuance of his sentence or unlawfully at large when he would otherwise be so detained is legally incapable of voting at any parliamentary or local government election. (2) For this purpose (a) convicted person means any person found guilty of an offence (whether under the law of the United Kingdom or not), . , but not including a person dealt with by committal or other summary process for contempt of court; (c) a person detained for default in complying with his sentence shall not be treated as detained in pursuance of the sentence The effect of the last words of section 3(2)(a) and of section 3(2)(c) is to exclude persons imprisoned for contempt of court or default in paying a fine. Entitlement to vote in European Parliamentary elections is provided domestically by the European Parliamentary Elections Act 2002 (EPEA). For present purposes section 8(2) and (3) are relevant, and they confer such entitlement on a person: (2) . if on the day of the poll he would be entitled to vote as an elector at a parliamentary election in a parliamentary constituency wholly or partly comprised in the electoral region, and (a) the address in respect of which he is registered in the relevant register of parliamentary electors is within the electoral region, or (b) his registration in the relevant register of parliamentary electors results from an overseas elector's declaration which specifies an address within the electoral region. The disenfranchisement enacted by RPA section 3 is thus extended to apply to European Parliamentary elections. Under the Scotland Act 1998, section 11(1), the persons entitled to vote as electors at an election for membership of the Scottish Parliament in any constituency are those who on the day of the poll would be entitled to vote as electors at a local government election in an electoral area falling wholly or partly within the constituency. In effect, RPA section 3 is extended to Scottish Parliamentary elections. A3P1 reads: The High Contracting Parties undertake to hold free elections at reasonable intervals by secret ballot, under conditions which will ensure the free expression of the opinion of the people in the choice of the legislature. The European Parliament is for this purpose a legislature within the meaning of A3P1: see Matthews v United Kingdom (1999) 28 EHRR 361. So too is clearly the Scottish Parliament, under the devolution arrangements instituted by the Scotland Act, giving it wide ranging legislative authority. Lord Hope described as such in AXA General Insurance Ltd v HM Advocate [2011] UKSC 46, [2012] 1 AC 868, para 46: The Scottish Parliament takes its place under our constitutional arrangements as a self standing democratically elected legislature. Its democratic mandate to make laws for the people of Scotland is beyond question. Acts that the Scottish Parliament enacts which are within its legislative competence enjoy, in that respect, the highest legal authority. The United Kingdom Parliament has vested in the Scottish Parliament the authority to make laws that are within its devolved competence. The conclusion that the Scottish Parliament is a legislature within A3P1 was a conclusion implicitly accepted by the European Court of Human Rights in McLean and Cole v United Kingdom (Application Nos 12626/13 and 2522/12) (unreported) given 11 June 2013, and was shared by Lord Reed in the Extra Division in the present case (para 29 of his judgment). Conversely, a local government body or municipal authority is not part of a legislature in the United Kingdom within A3P1: McLean and Cole v United Kingdom. Under European Union law, as it stands since 1 December 2009 when the Treaty of Lisbon came into force, a wide range of provisions is potentially relevant. Articles 6, 10 and 14 TEU provide: COMMON PROVISIONS . 6.1. The Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union of 7 December 2000, as adapted at Strasbourg, on 12 December 2007, which shall have the same legal value as the Treaties. The provisions of the Charter shall not extend in any way the competences of the Union as defined in the Treaties. The rights, freedoms and principles in the Charter shall be interpreted in accordance with the general provisions in Title VII [Articles 5154] of the Charter governing its interpretation and application and with due regard to the explanations referred to in the Charter, that set out the sources of those provisions. 6.3. Fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States, shall constitute general principles of the Unions law. PROVISIONS ON DEMOCRATIC PRINCIPLES . 10. 1. The functioning of the Union shall be founded on representative democracy. 10.2. Citizens are directly represented at Union level in the European Parliament. Member States are represented in the European Council by their Heads of State or Government and in the Council by their governments, themselves democratically accountable either to their national Parliaments, or to their citizens. 10.3. Every citizen shall have the right to participate in the democratic life of the Union. Decisions shall be taken as openly and as closely as possible to the citizen. 10.4. Political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union. PROVISIONS ON THE INSTITUTIONS . 14.3. The members of the European Parliament shall be elected for a term of five years by direct universal suffrage in a free and secret ballot. The pre Lisbon Treaty predecessor of article 14.3 was article 190.1 and 190.4, reading: 190.1 The representatives in the European Parliament of the peoples of the States brought together in the Community shall be elected by direct universal suffrage. 4 The European Parliament shall draw up a proposal for elections by direct universal suffrage in accordance with a uniform procedure in all Member States or in accordance with principles common to all Member States. To give effect to article 190.4 the Council of Ministers agreed the Act concerning the election of the representatives of the European Parliament by direct universal suffrage, annexed to Council Decision 76/787/ECSC, EEC, Euratom of 20 September 1976 (0J 1976 L 278, p 1), as amended by Council Decision 2002/772/EC, Euratom of 25 June 2002 and 23 September 2002 (OJ 2002 L 283, p 1) (the 1976 Act), which continues to apply in the post Lisbon Treaty era. The 1976 Act provides inter alia by what is now article 7: Subject to the provisions of this Act, the electoral procedure shall be governed in each Member State by its national provisions. These national provisions, which may if appropriate take account of the specific situation in the Member States, shall not affect the essentially proportional nature of the voting system. Voting in European Parliamentary and municipal elections is dealt with more specifically by Articles 20 and 22 TFEU in a Part headed Non discrimination and Citizenship of the Union: 20.1. Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union shall be additional to and not replace national citizenship. 2. Citizens of the Union shall enjoy the rights and be subject to the duties provided for in the Treaties. They shall have, inter alia: (a) the right to move and reside freely within the territory of the Member States; (b) the right to vote and to stand as candidates in elections to the European Parliament and in municipal elections in their Member State of residence, under the same conditions as nationals of that State; (c) the right to enjoy, in the territory of a third country in which the Member State of which they are nationals is not represented, the protection of the diplomatic and consular authorities of any Member State on the same conditions as the nationals of that State; (d) the right to petition the European Parliament, to apply to the European Ombudsman, and to address the institutions and advisory bodies of the Union in any of the Treaty languages and to obtain a reply in the same language. 22.1. Every citizen of the Union residing in a Member State of which he is not a national shall have the right to vote and to stand as a candidate at municipal elections in the Member State in which he resides, under the same conditions as nationals of that State. This right shall be exercised subject to detailed arrangements adopted by the Council, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament; these arrangements may provide for derogations where warranted by problems specific to a Member State. 2. Without prejudice to Article 223(1) and to the provisions adopted for its implementation, every citizen of the Union residing in a Member State of which he is not a national shall have the right to vote and to stand as a Candidate in elections to the European Parliament in the Member State in which he resides, under the same conditions as nationals of that State. This right shall be exercised subject to detailed arrangements adopted by the Council, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament; these arrangements may provide for derogations where warranted by problems specific to a Member State. Article 52 of the Charter of Fundamental Rights (CFR) deals with the Charters scope and interpretation: 1. Any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others. 2. Rights recognised by this Charter for which provision is made in the Treaties shall be exercised under the conditions and within the limits defined by those Treaties. 3. In so far as this Charter contains rights which correspond to rights guaranteed by the Convention for the Protection of Human Rights and Fundamental Freedoms, the meaning and scope of those rights shall be the same as those laid down by the said Convention. This provision shall not prevent Union law providing more extensive protection. 4. In so far as this Charter recognises fundamental rights as they result from the constitutional traditions common to the Member States, those rights shall be interpreted in harmony with those traditions. 5. The provisions of this Charter which contain principles may be implemented by legislative and executive acts taken by institutions, bodies, offices and agencies of the Union, and by acts of Member States when they are implementing Union law, in the exercise of their respective powers. They shall be judicially cognisable only in the interpretation of such acts and in the ruling on their legality. 6. Full account shall be taken of national laws and practices as specified in this Charter. 7. The explanations drawn up as a way of providing guidance in the interpretation of this Charter shall be given due regard by the courts of the Union and of the Member States. The CFR includes the following provisions: Article 39 Right to vote and to stand as a candidate at elections to the European Parliament 1. Every citizen of the Union has the right to vote and to stand as a candidate at elections to the European Parliament in the Member State in which he or she resides, under the same conditions as nationals of that State. 2. Members of the European Parliament shall be elected by direct universal suffrage in a free and secret ballot. Article 40 Right to vote and to stand as a candidate at municipal elections Every citizen of the Union has the right to vote and to stand as a candidate at municipal elections in the Member State in which he or she resides under the same conditions as nationals of that State. The Explanations relating to the CFR, referred to in article 6.1 TEU, state that article 39 CFR: applies under the conditions laid down in the Treaties, in accordance with Article 52(2) of the Charter. Article 39(1) corresponds to the right guaranteed in Article 20(2) [TFEU] (cf. also the legal base in Article 22 [TFEU] for the adoption of detailed arrangements for the exercise of that right) and Article 39(2) corresponds to Article 14(3) [TEU]. Article 39(2) takes over the basic principles of the electoral system in a democratic state. The Explanations state further that article 40 CFR: corresponds to the right guaranteed by Article 20(2) [TFEU] (cf. also the legal base in Article 22 [TFEU] for the adoption of detailed arrangements for the exercise of that right). In accordance with Article 52(2) of the Charter, it applies under the conditions defined in these Articles in the Treaties. European Convention on Human Rights The general significance of A3P1 was summarised by Lord Collins in a judgment with which all members of the Court agreed in R (Barclay) v Lord Chancellor and Secretary of State for Justice [2009] UKSC 9, [2010] 1 AC 464, para 52. I need only to set out parts of his summary, omitting also some of the case references: 53. First, article 3 of the First Protocol enshrines a characteristic principle of an effective democracy. 54. Second, although article 3 is phrased in terms of the obligation of the contracting states to hold elections which ensure the free expression of the opinion of the people rather than in terms of individual rights, article 3 guarantees individual rights, including the right to vote and the right to stand for election . 55. Third, there is room for implied limitations on the rights enshrined in article 3, and contracting states must be given a wide margin of appreciation in this sphere: Mathieu Mohin v Belgium (1987) 10 EHRR 1, para 52; Yumak v Turkey (2008) 48 EHRR 61, para 109(ii). 56. Fourth, the content of the obligation under article 3 varies in accordance with the historical and political factors specific to each state; . 57. Fifth, article 3 is not (by contrast with some other Convention rights, such as those enumerated in articles 8 to 11) subject to a specific list of legitimate limitations, and the contracting states are therefore free to rely in general in justifying a limitation on aims which are proved to be compatible with the principle of the rule of law and the general objectives of the Convention: Yumak, para 109 (iii); Tanase v Moldova (Application No 7/08) (unreported) given 18 November 2008, para 105. 58. Sixth, limitations on the exercise of the right to vote or stand for election must be imposed in pursuit of a legitimate aim, must not be arbitrary or disproportionate, and must not interfere with the free expression of the opinion of the people in the choice of the legislature: Yumak, para 109(iii) to (iv). 59. Seventh, such limitations must not curtail the rights under article 3 to such an extent as to impair their very essence, and deprive them of their effectiveness. They must reflect, or not run counter to, the concern to maintain the integrity and effectiveness of an electoral procedure aimed at identifying the will of the people through universal suffrage. Any departure from the principle of universal suffrage risks undermining the democratic validity of the legislature and the laws which it promulgates: Mathieu Mohin, para 52; Yumak, para 109(iv). The European Court of Human Rights has expressed its attitude to the exclusion or limitation of prisoners voting rights in well known decisions. Hirst v United Kingdom (No 2) (2005) 42 EHRR 849 and Scoppola v Italy (No 3) (2012) 56 EHRR 663 each came first before a simple Chamber of seven judges and then before a Grand Chamber composed of 17 judges. Hirst (No 2) was a claim regarding his disenfranchisement from voting in United Kingdom Parliamentary and local elections brought by a prisoner serving a life sentence in England for manslaughter on the ground of diminished responsibility, whose tariff period had expired without his release. Scoppola was a claim relating to disenfranchisement under Italian law brought by a prisoner serving a sentence of 30 years imprisonment for murder, attempted murder and other offences. In between these two decisions came Greens and MT v United Kingdom (2010) 53 EHRR 710, in which a simple Chamber applied the principles in Hirst (No 2) to complaints of ineligibility to vote in both European and United Kingdom Parliamentary elections. More recently simple Chambers have applied the principles in Hirst (No 2) and Scoppola in Anchugov and Gladkov v Russia (Application Nos 11157/04 and 15162/05) (unreported), 4 July 2013, and Syler v Turkey (Application No 29411/07) (unreported), 17 September 2013. In Greens the Strasbourg Court gave the United Kingdom six months to introduce legislative proposals to amend RPA section 3, a period subsequently extended first pending the decision in Scoppola and then to six months after the Grand Chamber decision in Scoppola, delivered 22 May 2012. A draft Bill was published for pre legislative scrutiny on 22 November 2012 (Cm 8499) and a joint select committee was established to undertake this and to report by 31 October 2013. As envisaged in Hirst (No 2), para 83, the United Kingdom government has continued in this regard to liaise with the Committee of Ministers of the Council of Europe, which has on 6 December 2012 accepted the draft bill and the establishment of the committee as a legitimate means of implementing the judgment in Greens, and at its meeting on 26 September 2013, noted with interest that the pre legislative scrutiny by the committee was now due to be completed by 31 October 2013, underlined the urgency of bringing the legislative process to a conclusion, urged the United Kingdom authorities to provide information on the proposed legislative timescale without further delay and decided to resume examination of the progress made at a meeting in December 2013. This ongoing process was in June 2013 noted by the Strasbourg Court in its judgment in McLean and Cole, paras 36 37, where the Court concluded that, in its light, there was nothing to be gained from examining applications concerning future elections at this time (para 37). In Hirst (No 2), Greens and Scoppola the European Court of Human Rights acknowledged the width of the margin of appreciation, or the wide range of policy alternatives, which States enjoy in relation to voting rights (Hirst (No 2), para 78, Greens, para 114 and Scoppola, para 83). In both Hirst (No 2) and Scoppola the Grand Chamber acknowledged that disenfranchisement of convicted serving prisoners may be considered to pursue the aims of preventing crime and enhancing civic responsibility and respect for the rule of law (Hirst (No 2), paras 74 75 and Scoppola, para 90). In Hirst (No 2) the Grand Chamber (upholding the earlier Chamber) held that the United Kingdoms ban on prisoner voting was a general, automatic and indiscriminate restriction on a vitally important Convention right which fell outside any acceptable margin of appreciation and was incompatible with A3P1 (para 82). A powerfully constituted minority of the Grand Chamber (including its President and future President) dissented. It took as its test whether the restrictions on prisoner voting impair the very essence of the right to vote or are arbitrary (para O III5), and it pointed out that the Court should be very careful not to assume legislative functions and that there was little consensus in Europe about whether or not prisoners should have the vote (para O III6). It noted that a multi party Speakers Conference on Electoral Law in 1968 had unanimously recommended that convicted persons should not be entitled to vote, and that the RPA had been amended in 2000 only to permit remand prisoners and unconvicted mental patients to vote. As to the majority comment that there was no evidence of substantive debate in Parliament about the ban on convicted prisoners voting, the minority disagreed, on the basis that it was not for the Court to prescribe the way in which national legislatures carry out their legislative functions, and it must be assumed that the RPA reflects political, social and cultural values in the United Kingdom (para O III7) In Scoppola the United Kingdom intervened and the Attorney General appeared before the Grand Chamber to ask that it reconsider Hirst (No 2). But, in its judgment the Grand Chamber said (para 96) that it reaffirmed the principles set out by the Grand Chamber in the Hirst (No 2) judgment, in particular the fact that when disenfranchisement affects a group of people generally, automatically and indiscriminately, based solely on the fact that they are serving a prison sentence, irrespective of the length of the sentence and irrespective of the nature or gravity of their offence and their individual circumstances, it is not compatible with [A3P1]. However, the Grand Chamber (reversing the simple Chamber) found no contravention in relation to the Italian law in issue in Scoppola. The only dissent, by Judge Thr Bjrgvinsson, related to this conclusion. The Italian law was held compatible with the Convention because disenfranchisement applied only to sentences of three or more years, and lasted for only five years in the case of sentences of three to five years, though for life in the case of longer sentences. The Grand Chamber said that As a result, a large number of convicted prisoners are not deprived of the right to vote (paras 106 and 108). Furthermore, any prisoner could, three years after completing his sentence, apply for rehabilitation, which would be granted upon his displaying consistent and genuine good conduct and would terminate any ancillary penalties and other penal effect of the conviction including disenfranchisement (Scoppola, paras 38 and 109). The Grand Chamber specifically rejected the Chamber view that any decision to deprive a prisoner of the vote should be taken by a court, saying (para 99): While the intervention of a judge is in principle likely to guarantee the proportionality of restrictions on prisoners' voting rights, such restrictions will not necessarily be automatic, general and indiscriminate simply because they were not ordered by a judge. Indeed, the circumstances in which the right to vote is forfeited may be detailed in the law, making its application conditional on such factors as the nature or the gravity of the offence committed. Judge Thr Bjrgvinsson dissented because in his view the Grand Chamber judgment in Scoppola offer[ed] a very narrow interpretation of the Hirst judgment which stripped it of all its bite (para OI 16). In particular, the Grand Chamber had in his view overlooked significant elements of the reasoning in Hirst (No 2), notably the absence of any direct link between the facts of the individual case and the ban on voting, the bluntness of the Italian legislation, just like the UK legislation, and the absence of evidence that either the legislature or the courts had weighed the proportionality of the ban (para 0I 13). Should the Supreme Court follow the Strasbourg case law? On the present appeal, the Attorney General (withdrawing a concession of incompatibility made in the courts below) has made a fresh challenge to the principles endorsed by the European Court of Human Rights in Hirst (No 2) and Scoppola. He points out, correctly, that the Supreme Court is, under section 2(1) of the Human Rights Act, obliged only to take into account any judgment or decision of the European Court of Human Rights when determining a question which has arisen in connection with a Convention right. In R v Horncastle [2009] UKSC 14, [2010] 2 AC 373, para 11 Lord Phillips said that The requirement to take into account the Strasbourg jurisprudence will normally result in the domestic court applying principles that are clearly established by the Strasbourg court. There will, however, be rare occasions where the domestic court has concerns as to whether a decision of the Strasbourg court sufficiently appreciates or accommodates particular aspects of our domestic process. In such circumstances it is open to the domestic court to decline to follow the Strasbourg decision, giving reasons for adopting this course. This is likely to give the Strasbourg court the opportunity to reconsider the particular aspect of the decision that is in issue, so that there takes place what may prove to be a valuable dialogue between the domestic court and the Strasbourg court. In Manchester City Council v Pinnock [2010] UKSC 45, [2011] 2 AC 104, para 48 Lord Neuberger summarised the position: This court is not bound to follow every decision of the European court. Not only would it be impractical to do so: it would sometimes be inappropriate, as it would destroy the ability of the court to engage in the constructive dialogue with the European court which is of value to the development of Convention law: see e g R v Horncastle [2010] 2 AC 373. Of course, we should usually follow a clear and constant line of decisions by the European court: R (Ullah) v Special Adjudicator [2004] 2 AC 323. But we are not actually bound to do so or (in theory, at least) to follow a decision of the Grand Chamber. As Lord Mance pointed out in Doherty v Birmingham City Council [2009] AC 367, para 126, section 2 of the 1998 Act requires our courts to take into account European court decisions, not necessarily to follow them. Where, however, there is a clear and constant line of decisions whose effect is not inconsistent with some fundamental substantive or procedural aspect of our law, and whose reasoning does not appear to overlook or misunderstand some argument or point of principle, we consider that it would be wrong for this court not to follow that line. In relation to authority consisting of one or more simple Chamber decisions, dialogue with Strasbourg by national courts, including the Supreme Court, has proved valuable in recent years. The process enables national courts to express their concerns and, in an appropriate case such as R v Horncastle, to refuse to follow Strasbourg case law in the confidence that the reasoned expression of a diverging national viewpoint will lead to a serious review of the position in Strasbourg. But there are limits to this process, particularly where the matter has been already to a Grand Chamber once or, even more so, as in this case, twice. It would have then to involve some truly fundamental principle of our law or some most egregious oversight or misunderstanding before it could be appropriate for this Court to contemplate an outright refusal to follow Strasbourg authority at the Grand Chamber level. The Attorney Generals submissions to us in this case have to be considered in that light. Parliament has required this Court to take into account Strasbourg case law (Human Rights Act, section 2(1)(a)) and, So far as it is possible to do so, to read and give effect to legislation in a way which is compatible with the Convention rights (section 3(1)). Parliament has given this Court, if satisfied that a provision of primary legislation is incompatible with a Convention right, power to make a declaration of that incompatibility (section 4). The Act itself contemplates that domestic legislation may not match this countrys international obligations as established by case law of the European Court of Human Rights. It is against this background that the Supreme Court must consider whether the Attorney General has made good his case that the Court should refuse to follow and apply the approach taken by the European Court of Human Rights in Hirst (No 2) and Scoppola. The Attorney General took issue with any description of Hirst (No 2) and Scoppola as a clear and consistent line of decisions. But, whatever else may be said about their reasoning or its outcome, they both clearly stand for the core proposition, directly applicable to the current general ban on convicted prisoners voting, quoted in paras 20 and 22 above. At the heart of the Attorney Generals submissions lies the wide margin of appreciation which States have in this area, and the variety of legislative attitudes in other States, some according with the United Kingdoms. These were matters which the European Court of Human Rights acknowledged, but in the Attorney Generals submission failed to respect. In support of his submission the Attorney General makes a number of points. First, the area is one where there is room (in Laws LJs words in the Court of Appeal, [2010] EWCA Civ 1439, [2011] 1 WLR 1436, para 32) for deep philosophical differences of view between reasonable people. In circumstances where the Grand Chamber accepted as a legitimate aim of disenfranchisement enhancing civic responsibility and respect for the rule of law (Scoppola, para 90), the United Kingdom was, as a participatory democracy, entitled to withhold the vote from those serving sentences for offences sufficiently serious to justify such a sentence, including those who, after their tariff period, could not satisfy the Parole Board that it was no longer necessary for the protection of the public that they should be confined (Crime (Sentences) Act 1997, section 28(6)(b)). Secondly, the Grand Chamber in Hirst (No 2) (para 79) attached some significance to a suggested lack of evidence that Parliament [had] ever sought to weigh the competing interests or to assess the proportionality of a blanket ban on the right of a convicted prisoner to vote, adding only: It may perhaps be said that, by voting the way they did to exempt unconvicted prisoners from the restriction on voting, Parliament implicitly affirmed the need for continued restrictions on the voting rights of convicted prisoners. Nonetheless it cannot be said that there was any substantive debate by members of the legislature on the continued justification in light of modern day penal policy and of current human rights standards for maintaining such a general restriction on the right of prisoners to vote. The majority in Scoppola did not mention this factor, as Judge Thr Bjrgvinsson, dissenting, pointed out at paras OI 09 and OI 15. Nevertheless, the Attorney General submits that it is relevant that Parliament has, since Hirst (No 2), conducted three formal debates, in Westminster Hall on 11 January 2011, in the Commons on 10 February 2011, when MPs voted 234 to 22 to maintain the status quo, and again in the Commons on 22 November 2012, after the Lord Chancellor introduced a draft Bill, the outcome of which is not yet determined. Mindful of the injunction in the Bill of Rights 1688 That the Freedome of Speech and Debates or Proceedings in Parlyament ought not to be impeached or questioned in any Court or Place out of Parlyament, the Attorney General did not suggest that we should seek to evaluate the quality of the debate in Parliament. But he relied upon the fact of debate and the continuation following it of the ban on prisoner voting as underlining his submission that the Convention rights should be understood and applied in a way respecting the choice made by the institution competent to make such choices in a democracy. He pointed out that the Court in its recent decision in Animal Defenders International v United Kingdom (Application No 48876/08, 22 April 2013) demonstrated the considerable weight that it was prepared to attach to exacting and pertinent reviews, by both parliamentary and judicial bodies, of the complex regulatory regime governing political broadcasting in the United Kingdom and to their view that the general measure [prohibiting religious or political advertising on radio and television] was necessary to prevent the distortion of crucial public interest debates and, thereby, the undermining of the democratic process (para 116). Thirdly, the Attorney General argues, it was fallacious to treat the United Kingdom ban as affecting a group of people generally, automatically and indiscriminately, simply because the ban was based solely on the fact that they are serving a prison sentence, irrespective of the length of the sentence and irrespective of the nature or gravity of their offence and their individual circumstances. Any rule of law affects a group of people defined by its terms. If a group is rationally defined, there is no reason why there should necessarily be exceptions. As the Grand Chamber pointed out in relation to the Italian legislation in Scoppola (para 106), so also in the United Kingdom a sentencing court takes into account the nature and gravity of the offence as well as individual circumstances when deciding in the first place whether any and if so what sentence of imprisonment is required. As a result, only 8% of convicted offenders go to prison in England, 15% in Scotland. The group affected is confined to convicted prisoners and so excludes those in prison on remand awaiting trial as well as hospital detainees. Further, within the group of convicted prisoners, the ban does not extend to those in prison for contempt or default in paying fines. Despite the Attorney Generals forceful submissions, I do not consider that it would be right for this Court to refuse to apply the principles established by the Grand Chamber decisions in Hirst (No 2) and Scoppola consistently with the way in which they were understood and applied in those decisions. The Grand Chamber in Scoppola was prepared to give the Italian legislator a greater margin of manoeuvre than one would have expected from its previous decision in Hirst (No 2). But this was on the basis that the Italian law did not involve a blanket ban in respect of all or almost all convicted prisoners. It excluded those convicted of minor offences (involving less than three years imprisonment), and it had a two step gradation in the length of the ban according to whether the sentence was for less or for more than five years imprisonment. As a result a large number of convicted prisoners had the vote. Furthermore, there was the possibility of rehabilitation for consistent and genuine good conduct displayed for three years after release. Nothing in Scoppola therefore suggests that the Grand Chamber would revise its view in Hirst (No 2) to the point where it would accept the United Kingdoms present general ban. There is on this point no prospect of any further meaningful dialogue between United Kingdom Courts and Strasbourg. I would also reject the suggestion that the Supreme Court should refuse to apply the principles stated in the Strasbourg case law in the present circumstances. Deep though the philosophical differences of view between reasonable people may be on this point, it would in my opinion exaggerate their legal and social importance to regard them as going to some fundamental substantive or procedural aspect of our law: see the citation from Pinnock in para 26 above. While the diversity of approach in this area within Europe derives from different traditions and social attitudes, it makes it difficult to see prisoner disenfranchisement as fundamental to a stable democracy and legal system such as the United Kingdom enjoys. It is possible to argue, as the Canadian Supreme Court did in Sauv v Canada (No 2) [2002] 3 SCR 519 that the objective of promoting civic responsibility and respect for the law may be undermined, rather than enhanced, by denying serving prisoners the right to vote. The haphazard effects of an effectively blanket ban are certainly difficult to deny. As the Grand Chamber observed in Hirst (No 2) (para 77) it includes a wide range of offenders and sentences, from one day to life and from relatively minor offences to offences of the utmost gravity. The Grand Chamber may have had in mind that, although minor offences involve shorter periods of disenfranchisement, the effect is more likely to be haphazard, depending as it must upon the timing of elections. Application of the principles in Hirst (No 2) and Scoppola This brings me to the effect of the principles in Hirst (No 2) and Scoppola in the present cases. Chesters claim, which relates to voting in European Parliamentary elections, is based directly on the Convention rights as well as on EU law. The first question is therefore whether he is a victim capable of bringing a claim against the respondents under the Human Rights Act. Section 7 of the Act provides: (1) A person who claims that a public authority has acted (or proposes to act) in a way which is made unlawful by section 6(1) may (a) bring proceedings against the authority under this Act in the appropriate court or tribunal, or (b) rely on the Convention right or rights concerned in any legal proceedings, but only if he is (or would be) a victim of the unlawful act. (3) If the proceedings are brought on an application for judicial review, the applicant is to be taken to have a sufficient interest in relation to the unlawful act only if he is, or would be, a victim of that act. (4) If the proceedings are made by way of a petition for judicial review in Scotland, the applicant shall be taken to have title and interest to sue in relation to the unlawful act only if he is, or would be, a victim of that act. (7) For the purposes of this section, a person is a victim of an unlawful act only if he would be a victim for the purposes of Article 34 of the Convention if proceedings were brought in the European Court of Human Rights in respect of that act. In Hirst (No 2), the majority rejected a submission by the United Kingdom Government that the Chamber had assessed the compatibility of the legislation with the Convention in the abstract without consideration of whether removal of the vote from the applicant as a person convicted of a serious offence and sentenced to life imprisonment disclosed a violation. It said (para 72) that Hirsts complaint was in no sense an actio popularis. He was directly and immediately affected by the legislative provision of which complaint is made and in these circumstances the Chamber was justified in examining the compatibility with the Convention of such a measure, without regard to the question whether if the measure had been framed otherwise and in a way which was compatible with the Convention, the applicant might still have been deprived of the vote. It would not in any event be right for the Court to assume that, if Parliament were to amend the current law, restrictions on the right to vote would necessarily still apply to post tariff life prisoners or to conclude that such an amendment would necessarily be compatible with Article 3 of Protocol No 1. This was another point on which the minority disagreed, observing the Courts task was not normally to review the relevant law and practice in abstracto and that it was in our opinion, difficult to see in what circumstances restrictions on voting rights would be acceptable, if not in the case of persons sentenced to life imprisonment (para O III8). Taking the majority approach, Chester is a victim for the purposes of section 7 of the Human Rights Act, but this means that he satisfies a pre condition to, not that he is necessarily entitled to any particular relief in, a complaint about the general disenfranchisement of prisoners from voting in United Kingdom and European Parliamentary elections which results from EPEA section 8(2) and (3), read with RPA section 3. He claims a declaration that both RPA section 3 and EPEA section 8(2) are incompatible with A3P1. (I note that, in contrast, under European Union law, his primary submission in relation to EPEA section 8(2) is that it can be rendered compatible with European Union law by reading in an additional right to vote in European Parliamentary elections if necessary to comply with European Union law.) The incompatibility of RPA section 3 with A3P1 was recognised by the Registration Appeal Court in Smith v Scott 2007 SC 345, which made a declaration of incompatibility. That declaration was properly made in the case of a convicted person sentenced to five years imprisonment for being concerned with supply of controlled drugs. It entitled the Government to use the remedial order provisions contained in section 10 of the Human Rights Act. The Government decided not to do this. The issue is now however before the United Kingdom Parliament and under active consideration in the light of the decisions in Hirst (No 2), Greens and Scoppola. Further, it is clear from Greens (para 18 above) and the Attorney General accepts that EPEA section 8 is, in relation to European Parliamentary elections, as incompatible with A3P1 as RPA section 3 is, in relation to United Kingdom Parliamentary elections. A declaration is a discretionary remedy, both generally and under the Human Rights Act 1998, section 4 (4). There is in these circumstances no point in making any further declaration of incompatibility. On this I am in agreement with both Burton J at first instance, [2009] EWHC 2923 (Admin), and the Court of Appeal, [2010] EWCA Civ 1439, [2011] 1 WLR 1436. The Strasbourg Courts own decision in McLean and Cole to defer consideration of applications concerning future elections in the light of the ongoing Parliamentary process is also consistent with this view. Further, it can, I consider, now be said with considerable confidence that the ban on Chesters voting is one which the United Kingdom Parliament can, consistently with the Convention right, and would maintain, whatever amendments it may be obliged to make or may make to allow any prisoners detained for different reasons or periods to vote. In the original Chamber decision in Hirst (2004) 38 EHRR 825, reference was made to the continuation of the ban on voting after the expiry of the tariff period in the case of a life prisoner as an additional anomaly (para 49). Nevertheless, the Chamber went on to say that it could not speculate as to whether Hirst, whose tariff had expired, would still have been deprived of the vote even if a more limited restriction on the right to [sic] prisoners to vote had been imposed, which was such as to comply with the requirements of [A3P1] (para 51). It is notable that the majority in the Grand Chamber in Hirst (No 2) did not endorse this reference in para 49 of the simple Chambers judgment to an additional anomaly, saying only that it would not in any event be right for the Court to assume that, if Parliament were to amend the current law, restrictions on the right to vote would necessarily still apply to post tariff life prisoners or to conclude that such an amendment would necessarily be compatible with [A3P1] (para 72). Only in a concurring opinion of Judge Caflisch did he raise the point, going so far as to say that this may be the essential point for the present case (para O 17(d)). His opinion does not appear to have been shared by other judges, and must now in any event be seen in the light of the decision in Scoppola, accepting that a lifelong ban on voting by prisoners sentenced for five or more years was legitimate. The additional fact that it was subject to removal after three years had elapsed from release, provided that the offender has displayed consistent and genuine good behaviour does not appear to have been critical to this conclusion; but, however that may be, it points strongly in favour of a view that it can be legitimate to withhold a prisoners voting rights until satisfied that it is no longer necessary for the protection of the public that the prisoner should be confined. The Grand Chambers reasoning in its very recent decision in Vinter v United Kingdom (Application Nos 66069/09, 130/10 and 3896/10; 9 July 2013), which post dated submissions in this case, is also worth noting for its explanation of detention during a post tariff period by reference to core aims of imprisonment: 108. First, a life sentence does not become irreducible by the mere fact that in practice it may be served in full. No issue arises under Article 3 if a life sentence is de jure and de facto reducible . In this respect, the Court would emphasise that no Article 3 issue could arise if, for instance, a life prisoner had the right under domestic law to be considered for release but was refused on the ground that he or she continued to pose a danger to society. This is because States have a duty under the Convention to take measures for the protection of the public from violent crime and the Convention does not prohibit States from subjecting a person convicted of a serious crime to an indeterminate sentence allowing for the offenders continued detention where necessary for the protection of the public . Indeed, preventing a criminal from re offending is one of the essential functions of a prison sentence . This is particularly so for those convicted of murder or other serious offences against the person. The mere fact that such prisoners may have already served a long period of imprisonment does not weaken the States positive obligation to protect the public; States may fulfil that obligation by continuing to detain such life sentenced prisoners for as long as they remain dangerous . [case references omitted] emphasised in Hirst (No 2) that In Greens, the Court noted (para 113) that the Grand Chamber had there are numerous ways of organising and running electoral systems and a wealth of differences, inter alia, in historical development, cultural diversity and political thought within Europe which it is for each contracting state to mould into their own democratic vision. The Court recalls that its role in this area is a subsidiary one: the national authorities are, in principle, better placed than an international court to evaluate local needs and conditions and, as a result, in matters of general policy, on which opinions within a democratic society may reasonably differ, the role of the domestic policy maker should be given special weight. See also Scoppola, para 83 and Syler, para 33. Within the domestic legal context, it is now therefore for Parliament as the democratically elected legislature to complete its consideration of the position in relation to both RPA section 3 and EPEA section 8. There is no further current role for this Court, and there is no further claim, for a declaration or, in the light of the incompatibility, for damages which the appellant Chester can bring. European law I turn to the position under European Community and now Union law. Before Burton J and the Court of Appeal, and reflecting no doubt the argument before those courts, any claim under European Union law by Chester was treated as effectively consequential on the incompatibility of the ban with A3P1, and attracted no separate analysis. Bearing in mind the date of Chesters claim for judicial review (December 2008), he is also unable to rely upon European law as it stands after 1 December 2009 under the TEU and TFEU, as a result of the Treaty of Lisbon. This difficulty is not overcome by maintaining that his claim related to forthcoming elections. It still required to be viewed in the light of the law when it was brought. At that date, the Charter of Fundamental Rights did not have direct legal force, so that there was no equivalent of article 6.1 TEU. The predecessor of article 6.3 TEU was article 6.2 of the pre December 2009 TEU reading: The Union shall respect fundamental rights, as guaranteed by the [Human Rights] Convention and as they result from the constitutional traditions common to the Member States, as general principles of Community law. The predecessor of article 14.3 TEU was article 190.1 and 4 of the Treaty on the European Community (EC), set out in para 11 above. Article 22.1 and 22.2 had a precise equivalent in article 19.1 and 19.2 EC, but the predecessor of article 20 was article 17 EC, reading simply: 17.1 Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union shall complement and not replace national citizenship. 2. Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the duties imposed thereby. McGeochs claim under European Union law was on the other hand issued in early 2011 and relates to voting in local as well as Scottish and European Parliamentary elections. It therefore opens up all possible avenues for exploration under current European Union law. However, there is nothing in European Union law which can entitle McGeoch to complain in respect of his inability to vote in Scottish Parliamentary elections. European Union law refers in various contexts, which have already been set out in this judgment, to voting in European Parliamentary elections and in municipal elections, and to no other elections. It is obvious that Scottish Parliamentary elections fall within neither category: see also what I have already said in para 9 above. That municipal elections are local government elections at a lower level of government, closer to people and with a more direct responsibility for service delivery, is furthermore consistent with the nature of the units found (though in the case of Scotland, not yet updated) in the annex to Council Directive 94/80/EC, which lays down detailed arrangements for the exercise of the right to vote and stand in municipal elections by Union citizens residing in a Member State of which they are not nationals. The submissions under European Union law are put at various different levels. Mr Aidan ONeill QC for McGeoch concentrated upon articles 20 and 22 TFEU, read with articles 39 and 40 CFR. Mr Southey for Chester adopted Mr ONeills submissions, but relied in addition upon the more general provisions of articles 6.3 (or its predecessor article 6.2 in the pre December 2009 TEU), 10 and 14.3 TEU (or the latters predecessor articles 190.1 and 4 EC). In his submission, the effect of these articles was, at the least, to incorporate into European Union law in relation to voting in European Parliamentary elections the principles recognised under Strasbourg case law (Hirst (No 2) and Scoppola) in relation to national legislatures. Quite possibly, he submitted, their effect may even be to lead the Court of Justice to go further than Strasbourg case law by prohibiting on a more extensive basis any limitations on the democratically based universal suffrage to which the Treaties refer. If Mr Southeys wider submission with regard to the wholesale importation into European Community or Union law of the Strasbourg jurisprudence regarding the right to vote were valid, it would be surprising to find no hint of this in any Court of Justice judgment. That is particularly so with regard to Case C 145/04 Spain v United Kingdom [2006] ECR I 7917 and Case 300/04 Eman and Sevinger v College van Burgemeester en Wethouders van den Haag [2006] ECR I 8055, despite the difference in the actual issues. Mr Southeys submission would also mean that a case such as Matthews v United Kingdom (1999) 28 EHRR 361 could, now at least, be pursued in either of two parallel forums. Spain v United Kingdom and Eman and Sevinger The judgments in Spain v United Kingdom and Eman and Sevinger were both issued on the same day (12 September 2006) following an opinion of Advocate General Tizzano (dated 6 April 2006) which had covered both cases. The judgments contain discussion of the scope and effect of European Treaty law which bears on both Mr Southeys wider and Mr ONeills narrower submissions. In Spain v United Kingdom the first issue was whether it was legitimate under European law for the United Kingdom to extend the franchise in European Parliamentary elections to qualifying Commonwealth citizens, as well as European Union citizens, registered in the Gibraltar register. The Court held (para 78) that, in the then current state of Community law the definition of the persons entitled to vote and to stand as a candidate in elections to the European Parliament falls within the competence of each Member State in compliance with Community law, and that Articles 189 EC, 190 EC, 17 EC and 19 EC do not preclude the Member States from granting that right to vote and to stand as a candidate to certain persons who have close links to them, other than their own nationals or citizens of the Union resident in their territory. In the course of its reasoning, the Court said: Articles 189 EC and 190 EC do not expressly and precisely state who are to be entitled to the right to vote and to stand as a candidate for the European Parliament. 66 [Article 19 EC] is confined to applying the principle of non discrimination on grounds of nationality to the exercise of that right, by providing that every citizen of the Union residing in a Member State of which he is not a national is to have the right to vote and to stand as a candidate in elections to the European Parliament in the Member State in which he resides, under the same conditions as nationals of that State. 76 . Article 19(2) EC . is confined, as pointed out in paragraph 66 above, to stating a rule of equal treatment between citizens of the Union residing in a Member State so far as concerns that right to vote and stand for election. While that provision, like Article 19(1) EC relating to the right of Union citizens to vote and to stand as a candidate at municipal elections, implies that nationals of a Member State have the right to vote and to stand as a candidate in their own country and requires the Member States to accord those rights to citizens of the Union residing in their territory, it does not follow that a Member State in a position such as that of the United Kingdom is prevented from granting the right to vote and to stand for election to certain persons who have a close link with it without however being nationals of that State or another Member State. The Court also referred to the provisions of the 1976 Act (paras 67 to 69). In paras 90 to 97 the Court of Justice addressed Spains second plea that the United Kingdom had, in the arrangements made to enable the Gibraltar electorate to vote, gone further than required to comply with the European Court of Justices judgment in Matthews v United Kingdom. It recited in this connection that it was the United Kingdoms obligation to comply with Matthews and that in the light of the case law of the European Court of Human Rights and the fact that that Court has declared the failure to hold elections to the European Parliament in Gibraltar to be contrary to [A3P1] ., the United Kingdom cannot be criticised for adopting the necessary legislation. In Eman and Sevinger the Court was concerned with the legitimacy under European Union law of a provision of Dutch law which conferred the right to vote in European Parliamentary elections upon Dutch nationals residing in the Netherlands or abroad except in Aruba and the Netherlands Antilles. After repeating (para 45) that in the current state of Community law, the definition of the persons entitled to vote and to stand for election falls within the competence of each Member State in compliance with Community law, the Court opened a possible role for European law in the instant case by continuing It must, however, be ascertained whether that law precludes a situation such as that in the main proceedings, in which Netherlands nationals residing in Aruba do not have the right to vote and to stand as a candidate in elections to the European Parliament. In relation to articles 189 and 190 EC, the Court repeated its words in para 65 of Spain v United Kingdom. It also repeated (para 53) that Article 19(2) EC is confined to applying the principle of non discrimination on grounds of nationality to that right to vote and stand for election, by stipulating that every citizen of the Union residing in a Member State of which he is not a national is to have the right to vote and to stand as a candidate in elections to the European Parliament in the Member State in which he resides, under the same conditions as nationals of that State. The Court further noted that the European Court of Human Rights had accepted that the right to vote might be limited by reference to residence. However, the Court found in the principle of equal treatment or non discrimination, which is one of the general principles of Community law a basis for comparing the position of a Netherlands national resident in the Netherlands Antilles or Aruba and one residing in a non member country (paras 57 58) and for concluding that the Dutch Government had not demonstrated an objective justification for the different treatment of these two persons (para 60). Earlier in its judgment, the Court of Justice had observed that A3P1 did not apply to Aruba; unlike the case with Gibraltar, the European Treaties have no application there, so the European Parliament could not be regarded as the Aruba legislature (para 48). But the Courts decision was based on the fact that the complainants held Dutch nationality and were as such citizens of the Union under article 17(1) EC, and entitled to enjoy the rights conferred by the Treaty under article 17(2). They succeeded under the general European legal principle of non discrimination. In Spain v United Kingdom the Court was thus concerned with Gibraltar which is within the territorial scope of both the Community and the European Convention on Human Rights, but with voting rights which the United Kingdom had conferred on persons who were not United Kingdom nationals for the purposes of Community law. The Court had nonetheless to consider the nature of the United Kingdoms obligation to extend the franchise in European Parliamentary elections to Gibraltar. In Eman and Sevinger, the Court was concerned with Aruba which is outside the territorial scope of the Community, but within the territorial scope of the European Convention on Human Rights (by the combination of declarations dated 29 November 1954 and 24 December 1985 deposited by the Netherlands with the Council of Europe), and with voting rights which had been withheld from persons who were citizens of the European Union. What is notably absent from the Court of Justices judgments in both Spain v United Kingdom and Eman and Sevinger is any suggestion that, by reason of article 6.2 of the pre December 2009 TEU and articles 17 and 190 EC, the European Treaties confer on citizens of the Union an individual right to vote, the scope and conditions of which must be measured by reference to the principles established in European Court of Human Rights jurisprudence, such as Hirst (No 2) and Scoppola. If available, that could have been advanced as a reason why it was obligatory under European Community law for the United Kingdom to take steps to enable the Gibraltar electorate to vote. Instead, the reason given was the United Kingdoms Council of Europe obligations to comply with Strasbourg decisions: see para 49 above. Likewise, in Scoppola there was no suggestion that as Union citizens the claimants were under Community law entitled to enjoy an individual right to vote, complying with the principles established by European Court of Human Rights jurisprudence. Advocate General Tizzano in his opinion for these two cases had adopted much broader reasoning which the Court in its judgments was careful not to endorse. He would have inferred from Community principles and legislation as a whole . that there is an obligation to grant the voting rights in question to citizens of the Member States and, consequently, to citizens of the Union (para 67), deriving this (para 69) from the principles of democracy on which the Union is based, and in particular, to use the words of the Strasbourg Court, the principle of universal suffrage which has become the basic principle in modern democratic States [FN: Eur. Court H.R. Mathieu Mohin and Clerfayt v Belgium, judgment of 2 March 1987 . , Hirst v United Kingdom (No 2), . 30 March 2004] and is also codified within the Community legal order in Article 190(1) EC and Article 1 of the 1976 Act, which specifically provide that the members of the European Parliament are to be elected by direct universal suffrage. He went on to say that this general guidance was also confirmed by the fact that the right in question is a fundamental right safeguarded by [A3P1], and to mention in a footnote that the text of article 6(2) need merely be borne in mind (paras 70 to 71). Turning to Spains second criticism, Advocate General Tizzano also derived from his conclusion that individual voting was a fundamental right of citizens of the Union a converse conclusion that it was illegitimate for the United Kingdom to deviate to any greater extent from its statement in what was then Annex II of the 1976 Act that The United Kingdom will apply the provisions of this Act only in respect of the United Kingdom. As stated in para 49 above, the Court of Justice adopted quite different reasoning and reached an opposite conclusion, based simply on the United Kingdoms obligation to give effect to the European Court of Human Rights ruling in Matthews. The Court of Justice did not therefore endorse Advocate General Tizzanos broad approach, or import the Strasbourg jurisprudence into the general provisions of Community and Union law referring to voting in European Parliamentary elections. There was good reason for this. Eligibility to vote is under the Treaties and the 1976 Act a matter for national Parliaments, one of considerable national interest. There is no sign that the European Commission has ever sought to involve itself in or take issue with voting eligibility in Member States or specifically with the restrictions on prisoner voting which apply in a number of such States. The Strasbourg jurisprudence operates as the relevant control, albeit one that has itself proved in some respects controversial. It would not only unnecessarily duplicate that control at the European Community or Union level, it could also lead to further conflict and uncertainty. Hence the Court of Justice in Eman and Sevinger confined its reasoning to a well established core principle of Treaty law, that of non discrimination, in that case between different categories of Dutch national, to which I shall return (paras 60 64 below). Further, even in the form into which they have been shaped by the Treaty of Lisbon, it is notable that such provisions as the European Treaties contain concerning individual voting rights are notably limited in scope. They relate to the core Treaty concerns of equality between nationals or Union citizens and freedom of movement within the European Union (see para 59 below). For all these reasons, I reject Mr Southeys wider submission set out in (paras 46 47 above). Articles 20.2 and 22 TFEU In Mr ONeills submission, the changes effected by the Treaty of Lisbon significantly altered the Treaty position considered in Spain v United Kingdom and Eman and Sevinger. In those cases article 19 EC was explained as confined to stating rules of equal treatment requiring Union citizens residing in Member States of which they were not nationals to be able to vote and stand in municipal as well as European Parliamentary elections under the same conditions as nationals. The same must apply to the current equivalent, article 22 TFEU. But Mr ONeill relies upon the introduction of the new article 20.2(b). This, he submits, is a self standing provision, expressly conferring the individual right to vote on citizens of the Union in respect of European Parliamentary and municipal elections. In my opinion, it is clear that that is not the effect of article 20.2(b). As its opening sentence proclaims, article 20 deals with the enjoyment of rights provided in the Treaties. What follow are some of the basic rights so enjoyed. They all have a supra national element. Article 20.2(b) is thus expressly limited to recording the existence of the right of Union citizens to vote and stand in municipal and European Parliamentary elections in their Member State of residence under the same conditions as nationals of that State. The omission of express reference to the fact that this is dealing with citizens resident in a State other than that of their nationality is entirely understandable in the context of what was intended as a concise summary. That fact is anyway implicit. The detailed Treaty provisions regarding the rights to which article 20.2(b) refers are contained in article 22.1 and 22.2, which would on Mr ONeills case in fact be not only redundant but also positively misleading in their limitation to the situation of residence in a Member State other than that of nationality. The position is further confirmed by articles 39 and 40 CFR, which again would be positively misleading in their limitation to that situation, and by the Explanations to the CFR which explicitly equate articles 20.2 and 22: see para 16 above. There is no basis for or likelihood in Mr ONeills supporting submission that article 20.2(b) was expressly aimed at, in effect, endorsing Advocate General Tizzanos views as to where European Union law was or should go in conferring individual rights. Had that been remotely intended, quite different explicit language would have been used. Non discrimination The other limb of Mr ONeills submissions involves reliance on the principle of non discrimination applied in Eman and Sevinger. The infringement there consisted in unequal treatment by Dutch law in relation to voting in European Parliamentary elections by Netherlands nationals in comparable situations. The most fundamental area in which this principle has always manifested itself is in relation to discrimination on the grounds of nationality: see article 7 of the original EEC Treaty, now article 18 TFEU, which provides: Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on the grounds of nationality shall be prohibited. But the principle has achieved much wider application. Article 13.1 EC (now substantially reproduced as article 19.1 TFEU) provides: Without prejudice to the other provisions of this Treaty and within the limits of the powers conferred by it upon the Community, the Council . may take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. Article 13 has been responsible for some well known, if in some respects controversial case law. The Court of Justice has accepted that, although the Treaty contemplates that the general principle of non discrimination underlying article 13 will be implemented by directives, Member States will be bound thereby to discontinue, disregard or set aside measures so far as they involve discrimination on a basis contrary to article 13 at least after the time for transposition of such a directive: Case C 555/07 Kkkdeveci v Swedex GmbH & Co KG [2010] 2 CMLR 33, para 61 and perhaps even when legislating in the area of the directive during the period for transposition: Case C 144/04 Mangold v Helm [2005] ECR I 9981. However, for the general principle of non discrimination to apply, the context must fall within the scope of Community or now Union law: see Mangold, para 75, Case C 427/06 Bartsch v Bosch und Siemens Hausgerte (BSH) Altersfrsorge GmBH [2008] ECR I 7245, para 25, Kkkdeveci, para 23, Case C 147/08 Rmer v Freie und Hansestadt Hamburg [2013] CMLR 11, para 70, and Craig and de Burca, EU Law: Text, Cases and Materials [OUP: 4th ed, 2008, p 891]. The only difficulty about Eman and Sevinger is to identify the link with European law, once one has rejected the conclusion that European law recognises all EU citizens as having under European law an individual right to vote in European Parliamentary elections (paras 56 to 58 above). The general principle was simply stated to be applicable in a context where, and on the basis that, Netherlands nationals, who were under article 17.1 EC Union citizens, were being treated unequally in comparable situations in relation to European Parliamentary elections, having regard to the difference in treatment of Netherlands nationals resident, on the one hand, in the Netherlands Antilles and Aruba and, on the other hand, in other non EU member countries: see in particular paras 45, 56 to 58 of the Courts judgment. It is however a general principle of Strasbourg law under article 14 of the Convention that additional rights falling within the general scope of any Convention right for which the state has voluntarily decided to provide must in that event be provided without discrimination: Belgian Linguistics Case (No 2) (1968) 1 EHRR 252, 283, R (Clift) v Secretary of State for the Home Department [2006] UKHL 54, [2007] 1 AC 484, paras 12, 17 18. This principle in my opinion clearly underlies Eman and Sevinger. As the Court noted (para 53), article 19 EC (now article 22 TFEU) only covered nationals resident in another Member State. But the Dutch legislator had chosen to extend the right to vote to its nationals resident outside any Member State but not in the Dutch Antilles or Aruba. There was no justification for this different treatment of comparable situations in a context which fell within the scope of European law, that is voting by nationals residing outside their own member state. Supporting this is also the consideration that the Court accepted that the definition of the persons entitled to vote and to stand falls within the competence of each Member State in compliance with Community law (Spain v United Kingdom, para 78, Eman and Sevinger, para 45). If the qualification in compliance with Community law were meant to require scrutiny by reference to European Community law of all national limitations affecting European Parliamentary elections for their non discriminatory quality even where no other link with European law was established other than that the elections were European Parliamentary elections, that could, depending upon the intensity of the scrutiny, effectively erode the general principle that the Court was accepting. Position if the principle of non discrimination had been engaged This brings me to consideration of the nature and intensity of the scrutiny which would be required, if (contrary to my conclusion in paras 63 64) the principle of non discrimination were to be viewed as all embracing in the manner advocated by Mr ONeill and Mr Southey. In both Strasbourg and Luxembourg case law, discrimination issues are customarily described as involving a two stage process, consisting of first the identification of an appropriate comparator and then, if one is found, examination of the justification for any difference in treatment: see e.g. Edward and Lane, European Union Law (EE, 2013) para 6.125, citing numerous authorities. The exercise as presented is neither a unitary nor an entirely open one, or a court would in every case be required to ascertain the differences between two different situations and ask whether, assessing such differences and their significance as best it could, it considered the differences in their treatment to be fair or justified. There must be basic comparability before the court embarks on considering justification. Thus, in Eman and Sevinger itself the Court observed (para 57) that the principle of equal treatment or non discrimination, which is one of the general principles of Community law, requires that comparable situations must not be treated differently and that different situations must not be treated in the same way unless such treatment is objectively justified The principle was reiterated in Case C485/08 P, Gualtieri v European Commission [2010] ECR I 3009, para 70 with reference to Eman and Sevinger as well as other cases including Case C 227/04 P Lindorfer v Council of the European Union [2007] ECR I6767. As the Court noted in Case C 267/06 Maruko v Versorgungsanstalt der deutschen Bhnen [2008] ECR I 1757, para 73, it is for the national court to determine whether two persons are in a comparable position. That does not however mean an identical position. The referring court in Maruko identified a gradual movement towards recognising equivalence of life partnership and marriage, meaning that, although the two were not identical, persons of the same sex could be regarded as being in a situation comparable to that of spouses so far as concerns the survivors benefit at issue in that case. The Court of Justice in Case 147/08 Rmer v Freie und Hansestadt Hamburg approved that approach, saying: 41 Accordingly, the existence of direct discrimination, within the meaning of the Directive, presupposes, first, that the situations being weighed up are comparable. 42 In that regard, it should be pointed out that, as is apparent from the judgment in Maruko at [67][73], first, it is required not that the situations be identical, but only that they be comparable and, secondly, the assessment of that comparability must be carried out not in a global and abstract manner, but in a specific and concrete manner in the light of the benefit concerned. Gualtieri was an appeal from the General Court and provides a contrasting example. The claimant complained that she received a lower daily allowance on the basis of the proximity of her spouses residence to her place of secondment than she would have done if she had been single, but living in a de facto union. The Court upheld the General Courts conclusion that the two situations were not comparable, saying: 75 . it must be observed that, although de facto unions and legally recognised unions, such as marriage, may display similarities in certain respects, those similarities do not necessarily mean that those two types of union must be treated in the same way. 76 In those circumstances, the decision to apply the criterion of matrimonial legal status appears neither arbitrary nor manifestly inappropriate in relation to the objective of reducing the allowances paid to SNEs [national experts seconded to the Commission] when they are in a situation in which it can be assumed that they bear fewer costs and disadvantages on account of their matrimonial status. Applying these principles to the present case, I do not regard convicted prisoners serving their sentence as in a comparable position either to free persons or to remand prisoners awaiting trial. They have a very different status, to which it is evident that very different considerations may apply and which are capable at least of giving rise to very different arguments. It follows that, assuming that the general principle of non discrimination applies under European Union law to eligibility to vote in European Parliamentary elections, there is in my view no basis for its application in the context of a complaint that convicted prisoners are discriminated against by reference to free persons or remand prisoners. The position assuming contrary conclusions I have concluded that the appellants are not entitled to invoke European law, because, firstly, it confers no individual right by reference to which the Strasbourg case law of Hirst (No 2) and Scoppola could be relevant (paras 58 and 59) and, secondly, the general principle of non discrimination recognised in Eman and Sevinger is not engaged (paras 63 64) or, if it is engaged, does not assist the appellants (para 68). In what follows, I will, for completeness, consider the position assuming opposite conclusions on all these points. If European law recognises an individual right to vote in European Parliamentary and/or municipal elections, I would reject Mr Southeys submission that it would or might go further than the Strasbourg case law in allowing convicted prisoners the vote. Court of Justice jurisprudence pays close attention to and, with very few exceptions, follows Strasbourg jurisprudence. Examples of divergence are few and far between, although one may, ironically, have occurred in a sequel to Eman and Sevinger concerning the right to vote in elections for the Kingdom of Holland, in so far as it is arguable that the Strasbourg court went less far in Sevinger and Eman v Netherlands (2007) 46 EHRR 179 than the Court of Justice did in Eman and Sevinger itself: see an instructive case note by Professor Leonard F M Besselink on this Strasbourg authority in (2008) 45 CMLR 787. In the present case, I reject in particular the submission that the Court of Justice might return to the theme suggested in Frodl v Austria (2010) 52 EHRR 267, para 34 by reference to Hirst (No 2), para 82 that it is essential that any disenfranchisement of a convicted prisoner be ordered on a case by case basis by a judge, rather than be pre determined by an otherwise appropriate legislative scheme. This suggestion was very clearly, and for very obvious reasons, rejected by the Grand Chamber in Scoppola v Italy, paras 99 100, a rejection which the simple Chamber in Anchugov, para 107, took pains to reiterate; see also (though coupled with a reference to judicial interventions being likely to guarantee the proportionality of restrictions on prisoners voting rights) Syler, para 39. The majority in the European Court of Human Rights in Hirst (No 2) found a violation because Hirst was directly and immediately affected by the legislative provision of which complaint is made and that the Chamber was justified in examining the compatibility with the Convention of such a measure, without regard to the question whether, if the measure had been framed otherwise and in a way which was compatible with the Convention, the applicant might still have been deprived of the vote (para 72). But it regarded the finding of a violation as just satisfaction and awarded no damages. As the Court said in Kkkdevici, para 51, it is for a national court, in applying national law, to provide, within the limits of its jurisdiction, the legal protection which individuals derive from European Union law and to ensure the full effectiveness of that law, disapplying if need be any provision of national legislation contrary to that principle (see, to that effect, Mangold, para 77). In the present cases, on the assumptions (contrary to my conclusions), first, that European law recognises an individual right to vote paralleling in substance that recognised in the Strasbourg case law of Hirst (No 2) and Scoppola, and, second, that the view taken by the majority of the Grand Chamber in Hirst (No 2) regarding standing to claim a general declaration were to be transposed into European law, the only relief that could be considered under domestic law would be a generally phrased declaration that the legislative provisions governing eligibility to vote in European Parliamentary and municipal elections in the United Kingdom were inconsistent with European Union law. Thereafter, it would be for the United Kingdom Parliament to address the position and make such legislative changes as were considered appropriate. But, for reasons paralleling those given in paras 40 42 above, it appears improbable that the Convention rights would, even when viewed through the prism of European Union law, involve or require the granting of declarations in the abstract at the instance of claimants like both Chester and McGeoch, detained in circumstances summarised in para 1 above, from whom the United Kingdom Parliament could legitimately, and it seems clear would, under any amended legislative scheme still withhold the vote. I reject the submission that the Supreme Court could or should simply disapply the whole of the legislative prohibition on prisoner voting, in relation to European Parliamentary and municipal elections, thereby making all convicted prisoners eligible to vote pending fresh legislation found to conform with European Union law. It is clear from both Hirst (No 2) and Scoppola that, under the principles established by those cases, a ban on eligibility will be justified in respect of a very significant number of convicted prisoners. Nor would it have been possible to read the RPA section 3 or EPEA section 8 compatibly with European law; the legislation is entirely clear and it would flatly contradict the evident intention of the United Kingdom, when enacting it, to read into it or to read it as subject to some unspecified scheme or set of qualifications allowing some unspecified set of convicted prisoners to vote under some unspecified conditions and arrangements. It would also be impossible for the Supreme Court itself to devise an alternative scheme of voting eligibility that would or might pass muster in a domestic or supra national European Court. Equally, the Court could not determine or implement the practical and administrative arrangements that would need to be made to enable any convicted prisoners eligible under any such scheme to have the vote. Such matters would be beyond its jurisdiction. In the domestic constitutional scheme, any scheme conferring partial eligibility to vote on some convicted prisoners is quintessentially a matter for the United Kingdom Parliament to consider, determine and arrange. In the passage quoted in para 72 above, the Court of Justice made clear that it is only within the limits of its jurisdiction that a national court can be expected to provide the legal protection that European Union law requires. That being so, the creation of any new scheme must be a matter for the United Kingdom Parliament. That does not necessarily conclude this Courts role under European law. The principles established in Case C 6/90 Francovich v Italian Republic [1992] IRLR 84 and Joined Cases C 46/93 and C 48/93 Brasserie du Pecheur SA v Federal Republic of Germany and R v Secretary of State for Transport, Ex p Factortame Ltd (No 4) [1996] QB 404 require domestic courts, under certain conditions, to order their State to make good any loss caused by breach of European Union law, even where the breach consists in legislation incompatible with that law. After these decisions by the Court of Justice, the principles stated by that Court were examined and applied domestically by the House of Lords in R v Secretary of State, Ex p Factortame Ltd (No 5) [2000] 1 AC 524. Neither Chester nor McGeoch has set out, supported with evidence or pursued any claim for damages in the courts below. Both now seek to claim damages, still without any supporting evidence, and, if necessary, to have their cases remitted for further determination in this regard. I will however put on one side without deciding the question whether either should be given leave to enable them at this late stage to raise any damages claim, and consider the nature and application of the relevant principles, assuming that such claims were to be permitted. An important factor in determining whether liability in damages may exist under European law is the width of the discretion available to the legislator: see Ex p Factortame, paras 44 to 46. In this respect the Court equated the position of the Community and national legislators (para 47). A strict (meaning more limited) approach was taken towards the liability of the Community (or therefore of national legislators) in the exercise of legislative activities. This was explained (para 45) as due to two considerations: 45. First, even where the legality of measures is subject to judicial review, exercise of the legislative function must not be hindered by the prospect of actions for damages whenever the general interest of the Community requires legislative measures to be adopted which may adversely affect individual interests. Secondly, in a legislative context characterized by the exercise of a wide discretion, which is essential for implementing a Community policy, the Community cannot incur liability unless the institution concerned has manifestly and gravely disregarded the limits on the exercise of its powers As the Court went on to point out, the national legislature like the Community institutions does not systematically have a wide discretion when it acts in a field governed by Community law (para 46). It depends on the nature of the European law or principle being implemented. However, in the context of eligibility to vote, it is clear that national legislatures have a wide discretion. Where a wide legislative discretion of this nature exists, three conditions govern the incurring of any liability on account of the legislative choices made by the State pursuant to such discretion. These were explained in Ex p Factortame as follows: 51 In such circumstances, Community law confers a right to reparation where three conditions are met: the rule of law infringed must be intended to confer rights on individuals; the breach must be sufficiently serious, and there must be a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured parties. 52 First, those conditions satisfy the requirements of the full effectiveness of the rules of Community law and of the effective protection of the rights which those rules confer. 53 Secondly, those conditions correspond in substance to those defined by the Court in relation to Article 215 in its case law on liability of the Community for damage caused to individuals by unlawful legislative measures adopted by its institutions. 55 As to the second condition, as regards both Community liability under Article 215 and Member State liability for breaches of Community law, the decisive test for finding that a breach of Community law is sufficiently serious is whether the Member State or the Community institution concerned manifestly and gravely disregarded the limits on its discretion. 56 The factors which the competent court may take into consideration include the clarity and precision of the rule breached; the measure of discretion left by that rule to the national or Community authorities; whether the infringement and the damage caused was intentional or involuntary; whether any error of law was excusable or inexcusable; the fact that the position taken by a Community institution may have contributed towards the omission, and the adoption or retention of national measures or practices contrary to Community law. 57 On any view, a breach of Community law will clearly be sufficiently serious if it has persisted despite a judgment finding the infringement in question to be established, or a preliminary ruling or settled case law of the Court on the matter from which it is clear that the conduct in question constituted an infringement. These principles were reiterated in Case 392/93 R v HM Treasury, Ex p British Telecommunications plc [1996] QB 615, an example of a case where the Court of Justice held that the breach had not involved a manifest and grave disregard of European law, and Case 278/05 Robins v Secretary of State for Work and Pensions [2007] ICR 779, where the Court emphasised the importance of the breadth of the legislative discretion in that case and the fact that the provisions of the relevant directive did not make it possible to establish with any precision the level of pension protection which it required. Turning to apply these principles to the present cases, I make the twin assumptions (again contrary to my conclusions) that (a) European Union confers rights to vote on individual citizens of the Union, subject to the United Kingdoms legislative discretion to introduce limitations, but that (b) the present general prohibition on prisoner voting is contrary to principles paralleling those stated by the Strasbourg court in Hirst (No 2) and Scoppola and/or the general European Union principle of equality or non discrimination. On those assumptions, the second and third conditions for any personal claim arise for consideration. The second condition is that the breach was sufficiently serious. This in turn depends, under European law, upon whether Parliament, the relevant United Kingdom authority, can be said manifestly and gravely to have disregarded the limits on its discretion. This must be judged taking into consideration the clarity and precision of the rule breached; the measure of discretion left by that rule to the national or Community authorities; whether the infringement and the damage caused was intentional or involuntary; whether any error of law was excusable or inexcusable (para 77 above). In relation to voting by convicted prisoners, the United Kingdom legislature enjoyed a wide margin of discretion. Further, this is in a context where there has been and remains a considerable lack of certainty about what the parameters of that discretion may be. This is evident from a reading of the Strasbourg case law, particularly the two Hirst judgments, the Chamber judgment in Frodl v Austria (2010) 52 EHRR 267 and the Grand Chamber judgment over ruling the Chamber judgment in Scoppola v Italy, in which the European Court of Human Rights has sought to identify the relevant considerations and to apply them to particular facts. Accordingly, it is clearly very arguable that this condition is not met. I will not however say more about the application of the second condition in this case, in view of one further factor, which I prefer to leave open. The test stated in the European authorities postulates some degree of examination of the conduct of the relevant national authority. Since the relevant United Kingdom authority is here Parliament in enacting and continuing in force the relevant legislation, an assessment of some of these matters (particularly whether the infringement was intentional or involuntary, excusable or inexcusable) may threaten conflict with the constitutional principle enshrined in the Bill of Rights 1688 that domestic courts in the United Kingdom ought not to impeach or question proceedings in Parliament. To avoid this, it may perhaps be necessary to approach a claim for damages in a case like the present on an objective basis, without regard to what has actually happened or been said in Parliament. The decision in R v Secretary of State, Ex p Factortame (No 5) [2000] 1 AC 524 does not appear to throw any light on this problem, because there does not seem there to have been any call to consider Parliamentary debates. On any view, however, the fact of Parliamentary activity, referred to in Greens and continuing, can no doubt be taken into account. The third condition is that there must be a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured parties. In relation to both the second and the third conditions, it must in my opinion be relevant to have regard to the particular position of the present appellants. The questions are whether, in refusing them the vote, the United Kingdom has manifestly and gravely disregarded the limits on its discretion and whether they have sustained damage directly caused by the United Kingdoms breach of an obligation owed to give each of them a right to vote. In Strasbourg case law, according to the majority in Hirst (No 2), a claimant can complain that the law in general is incompatible with the Convention rights, without showing that it was or would have been incompatible with such rights to deprive him in particular of the vote. But to award a convicted prisoner damages without showing that European Union law required him, rather than some other prisoner or prisoners, to have the vote would be positively inconsistent with the conditions stated in Francovich and Ex p Factortame. On that basis, I consider that any claim for damages by McGeoch and Chester must on any view fail. McGeoch is still serving the punishment part of his sentence resulting from the combination of his life and consecutive fixed term sentence. There can, in the light of Scoppola, be no question about the United Kingdoms entitlement to deprive a prisoner in his position of the vote. Chester is in his post tariff period of his life sentence, but it is notable that the European Court of Human Rights deliberately refrained from endorsing the original Chamber view or Judge Caflischs concurring minority view (para 40 above) that there is a critical distinction between the tariff and post tariff period. Further, in Scoppola, the Strasbourg court accepted that disenfranchisement could continue for life in the case of sentences of five years or more. This was subject only to the right, three years after release, to apply for rehabilitation, which would be granted upon his displaying consistent and genuine good conduct: see para 22 above. The requirement to display good conduct in order to regain voting rights was thus regarded as not only relevant, but acceptable. The Strasbourg court accepted as a legitimate aim enhancing civic responsibility and respect for the rule of law. Continuing detention for a period lasting so long as necessary for the protection of the public (paras 30 and 40 above) can be no less relevant and acceptable as a criterion for continuing deprivation of the right to vote during that period. The underlying consideration, that the offender is not fully rehabilitated or ready to participate responsibly in the countrys democratic life, is the same in each case. This is underlined by the passage from the Grand Chambers recent decision in Vinter quoted in para 41 above. Conclusions My conclusions on the issues argued on this appeal are summarised in para 4 above. It remains only to consider whether the resolution of this appeal necessitates a reference to the European Court of Justice. This depends upon whether it depends upon the determination of any question of European law which is open to reasonable doubt under the principles stated in Case 283/81 CILFIT Srl v Ministry of Health [1982] ECR 3415 and recently discussed in this Court in X v Mid Sussex Citizens Advice Bureau [2012] UKSC 59, [2013] ICR 249. In my opinion, the conclusions of European law reached in paras 45, 58, 59 and 63 64 are acte clair, and they are by themselves sufficient to resolve the appeals. Were it necessary for the decision of these appeals, I would also regard the conclusions in para 70 as acte clair. The further conclusions (again not necessary for the resolution of these appeals) reached in other paras are matters for this Court to determine, applying established principles of European law where relevant. In the circumstances, I do not consider that any reference to the Court of Justice is called for. It follows that, in my opinion, both appeals should be dismissed. LADY HALE (with whom Lord Hope and Lord Kerr agree) Prisoners voting is an emotive subject. Some people feel very strongly that prisoners should not be allowed to vote. And public opinion polls indicate that most people share that view. A YouGov poll in November 2012 found that 63% of respondents said that no prisoners should be allowed to vote, 15% said that those serving sentences of less than six months should be allowed to vote, 9% said that those serving less than four years should be allowed to vote, and 8% said that all prisoners should be allowed to vote. A YouGov poll in January 2011 which asked the same questions produced respective figures of 69%, 6%, 3% and 8%. This suggests that public opinion may be becoming more sympathetic to the idea, with 32% now favouring some relaxation in the present law, but there is still a substantial majority against it. It is not surprising, therefore, that in February 2011 elected Parliamentarians also voted overwhelmingly against any relaxation of the present law. In such circumstances, it is incumbent upon the courts to tread delicately. As I shall explain, in my view it is now clear that the courts should not entertain a human rights claim on behalf of Mr Chester or, indeed, of Mr McGeoch had he made one. Both are serving sentences of life imprisonment for murder. Mr Chester was sentenced to life imprisonment for the murder of his niece, with a tariff of 20 years which expired in October 1997. The Parole Board has not yet found him suitable for release on licence. Mr McGeoch was also sentenced to life imprisonment for murder, with a tariff of 13 years which expired in October 2011; but he has had further convictions for serious offences committed while in prison and is currently serving seven and a half years for violently escaping from prison in 2008. I do not consider that the human rights of either were violated by the Electoral Registration Officers refusal to register them on the electoral roll. Their claims under European Union law are another story, because they raise novel arguments which require to be resolved. On those claims I have nothing to add to the judgment of Lord Mance, with which I agree. Of course, in any modern democracy, the views of the public and Parliamentarians cannot be the end of the story. Democracy is about more than respecting the views of the majority. It is also about safeguarding the rights of minorities, including unpopular minorities. Democracy values everyone equally even if the majority does not: Ghaidan v Godin Mendoza [2004] 2 AC 557, para 132. It follows that one of the essential roles of the courts in a democracy is to protect those rights. It was for that reason that Lord Bingham took issue with the argument of a previous Attorney General, Lord Goldsmith, in A v Secretary of State for the Home Department [2005] 2 AC 68, para 42: I do not . accept the distinction which he drew between democratic institutions and the courts. It is of course true that the judges in this country are not elected and are not answerable to Parliament. But the function of independent judges charged to interpret and apply the law is universally recognised as a cardinal feature of the modern democratic state, a cornerstone of the rule of law itself. The Attorney General is fully entitled to insist on the proper limits of judicial authority, but he is wrong to stigmatise judicial decision making as in some way undemocratic. The present Attorney General has wisely not suggested any such thing. He recognises that it is the courts task to protect the rights of citizens and others within the jurisdiction of the United Kingdom in the ways which Parliament has laid down for us in the Human Rights Act 1998. But insofar as he implied that elected Parliamentarians are uniquely qualified to determine what the franchise should be, he cannot be right. If the current franchise unjustifiably excludes certain people from voting, it is the courts duty to say so and to give them whatever remedy is appropriate. More fundamentally, Parliamentarians derive their authority and legitimacy from those who elected them, in other words from the current franchise, and it is to those electors that they are accountable. They have no such relationship with the disenfranchised. Indeed, in some situations, they may have a vested interest in keeping the franchise as it is. To take an obvious example, we would not regard a Parliament elected by an electorate consisting only of white, heterosexual men as uniquely qualified to decide whether women or African Caribbeans or homosexuals should be allowed to vote. If there is a Constitution, or a Bill of Rights, or even a Human Rights Act, which guarantees equal treatment in the enjoyment of its fundamental rights, including the right to vote, it would be the task of the courts, as guardians of those rights, to declare the unjustified exclusion unconstitutional. Given that, by definition, Parliamentarians do not represent the disenfranchised, the usual respect which the courts accord to a recent and carefully considered balancing of individual rights and community interests (as, for example, in R (Countryside Alliance) v Attorney General [2007] UKHL 52, [2008] AC 719 and R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] UKHL 15, [2008] AC 1312, both upheld in Strasbourg for that very reason) may not be appropriate. Of course, the exclusion of prisoners from voting is of a different order from the exclusion of women, African Caribbeans or homosexuals. It is difficult to see how any elected politician would have a vested interest in excluding them (save just possibly from local elections in places where there are very large prisons). The arguments for and against their exclusion are quite finely balanced. On the one hand, unlike women, African Caribbeans and homosexuals, prisoners share a characteristic which many think relevant to whether or not they should be allowed to vote: they have all committed an offence deemed serious enough to justify their removal from society for at least a while and in some cases indefinitely. While clearly this does not mean that all their other rights are forfeited, why should they not for the same time forfeit their right to take part in the machinery of democracy? Hence I see the logic of the Attorney Generals argument, that by deciding that an offence is so serious that it merits a custodial penalty, the court is also deciding that the offence merits exclusion from the franchise for the time being. The custody threshold means that the exclusion, far from being arbitrary and disproportionate, is tailored to the justice of the individual case. One problem with that argument is that it does not explain the purpose of the exclusion. Any restriction of fundamental rights has to be a proportionate means of pursuing a legitimate aim. Is it simply an additional punishment, a further mark of societys disapproval of the criminal offence? Or is it rather to encourage a sense of civic responsibility and respect for democratic institutions? If so, it could well be argued that this is more likely to be achieved by retaining the vote, as a badge of continuing citizenship, to encourage civic responsibility and reintegration in civil society in due course. This is indeed, as Laws LJ observed in the Court of Appeal, a matter on which thoughtful people can hold diametrically opposing views. A more concrete objection to the Attorney Generals argument is that the custody threshold in this country has never been particularly high. As Lord Bingham of Cornhill CJ observed in R v Howells [1999] 1 WLR 307, 310, deciding when an offence is so serious that only a custodial sentence can be justified is one of the most elusive problems of criminal sentencing. Between 1992 and 2002, the custodial sentencing rate rose from 5% to 15% in the magistrates courts and from 44% to 63% in the Crown Court (for an overview of sentencing trends in the last 20 years, see Ministry of Justice, The Story of the Prison Population 1993 2012, 2013). Some of the rise may be accounted for by the greater seriousness of the offences coming before the courts, but this cannot be the whole explanation. There are many people in prison who have not committed very serious crimes, but for whom community punishments are not available, or who have committed minor crimes so frequently that the courts have run out of alternatives. Also, the threshold has varied over time in accordance with changes in penal policy which have nothing to do with electoral policy: what, for example, are we to make of the ups and downs in the legislative popularity of suspended sentences? Exactly the same crime may attract an immediate custodial sentence and disenfranchisement at one time or a suspended sentence without disenfranchisement at another. Moreover, the custody threshold has traditionally varied as between different parts of the United Kingdom, with a significantly greater use of imprisonment in Scotland than in England and Wales (although this is diminishing). The sentencing regimes are different in England and Wales, Scotland and Northern Ireland, but the exclusion from voting is the same. All of this suggests an element of arbitrariness in selecting the custody threshold as a unique indicator of offending so serious as to justify exclusion from the democratic process. To this may be added the random impact of happening to be in prison on polling day and the various reasons why someone who has been sentenced to a period of imprisonment may not in fact be in prison on that day. He may, as Lord Clarke points out, be on bail pending an appeal; or he may be released early under electronic monitoring. Then there is the situation of mental patients. All those who are detained in hospital as a result of an order made in a criminal court, apart from those on remand, are also disenfranchised (Representation of the People Act 1983, section 3A(1),(2)). This includes patients who have been found unfit to plead or not guilty by reason of mental disorder, whose culpability may be very different from that of convicted prisoners. There is no equivalent of the custody threshold (as long as the offence is punishable with imprisonment) and no correlation between the seriousness of the offence and the length of time that the patient will be detained in hospital. I mention these additional matters to explain why, in common with Lord Clarke, I have some sympathy for the view of the Strasbourg court that our present law is arbitrary and indiscriminate. But I acknowledge how difficult it would be to devise any alternative scheme which would not also have some element of arbitrariness about it. The Strasbourg court, having stepped back from the suggestion in Frodl v Austria (2010) 52 EHRR 267 that exclusion from the franchise requires a judicial decision in every case and approved the Italian law in Scoppola v Italy (No 3) (2012) 56 EHRR 663, must be taken to have accepted this. However, I have no sympathy at all for either of these appellants. I cannot envisage any law which the United Kingdom Parliament might eventually pass on this subject which would grant either of them the right to vote. In Hirst v United Kingdom (No 2) (2005) 42 EHRR 849, the Strasbourg court declined to conclude that applying the ban to post tariff life prisoners would necessarily be compatible with article 3 of the First Protocol. But it seems clear from the decision in Scoppola v Italy (No 3) that Strasbourg would now uphold a scheme which deprived murderers sentenced to life imprisonment of the right to vote, certainly while they remained in prison, and probably even after they were released on licence, as long as there was then a power of review. Hence I cannot see how Mr Chester can sensibly have a claim to a remedy under the Human Rights Act. It may be, as Lord Mance has concluded, that he qualifies as a victim for the purpose of section 7 of the Human Rights Act. But this is only in the sense that, as the majority of the Grand Chamber in Hirst (No 2) held, he was directly affected by the law in question. This justified that court, in the majority view, examining the compatibility of the law with the Convention, irrespective of whether he might justifiably have been deprived of the vote under some other law. A strong minority, including the then President, Judge Wildhaber, and his successor, Judge Costa, pointed out that this was not the usual practice of the court (para OIII8): The Court has consistently held in its case law that its task is not normally to review the relevant law and practice in abstracto, but to determine whether the manner in which they were applied to, or affected, the applicant gave rise to a violation of the Convention. It is, in our opinion, difficult to see in what circumstances restrictions on voting rights would be acceptable, if not in the case of persons sentenced to life imprisonment. Generally speaking, the Court's judgment concentrates above all on finding the British legislation incompatible with the Convention in abstracto. We regret that despite this focus it gives the states little or no guidance as to what would be solutions compatible with the Convention. Since restrictions on the right to vote continue to be compatible, it would seem obvious that the deprivation of the right to vote for the most serious offences such as murder or manslaughter, is not excluded in the future. Either the majority are of the view that deprivations for the post tariff period are excluded, or else they think that a judge has to order such deprivations in each individual case. We think that it would have been desirable to indicate the correct answer. In other words, it would have been in accordance with the consistent practice of the court for the majority to indicate in precisely what way Mr Hirsts rights had been violated by the law in question. It seems to me that the courts of this country should adopt that sensible practice when considering the application of the various remedies provided by the Human Rights Act. In this case, there can be no question of Mr Chester having a cause of action under section 6(1) of the Human Rights Act. The Electoral Registration Officer for Wakefield refused his application for inclusion on the electoral roll. But in my view that could not have been incompatible with his Convention rights, because (at least following Scoppola v Italy) the Convention does not give him the right to vote. But even if it was incompatible, the public authority could not have acted differently, because of the provisions of the Representation of the People Act, and so by virtue of section 6(2)(a) the act was not unlawful. Nor is there any question of our reading and giving effect to the Act in a way which is compatible with the Convention rights, in accordance with our duty under section 3(1). No one has suggested that it would be possible to do so in a case such as this. It is obvious that any incompatibility can only be cured by legislation and the courts cannot legislate. But even if we could, we would only seek to read and give effect to the statute in a way which was compatible with the rights of the individual litigant before us. As, in my view at least, the ban on voting is not incompatible with the rights of this particular litigant, a reading which was compatible with the rights of a completely different litigant would do him no good. That leaves the possibility of a declaration of incompatibility under section 4(2) of the Human Rights Act. This applies in any proceedings in which a court determines whether a provision of primary legislation is compatible with a Convention right. This does appear to leave open the possibility of a declaration in abstracto, irrespective of whether the provision in question is incompatible with the rights of the individual litigant. There may be occasions when that would be appropriate. But in my view the court should be extremely slow to make a declaration of incompatibility at the instance of an individual litigant with whose own rights the provision in question is not incompatible. Any other approach is to invite a multitude of unmeritorious claims. It is principally for that reason that I would decline to make a declaration of incompatibility on the application of either Mr Chester or (had he made one) Mr McGeoch. Indeed, in my view the courts should not entertain such claims. It is otherwise, of course, in borderline cases. In those circumstances it seems to me unnecessary to express a view on whether we should follow or depart from the substance of the decision in Hirst v LORD CLARKE I agree that these appeals should be disposed of as proposed by Lord Mance and Lord Sumption. I also agree with the reasoning of both Lord Mance and Lord Sumption, subject to this. I would be less critical than Lord Sumption of the decisions of the European Court of Human Rights to which they refer. The reasoning of the Strasbourg Court has very recently been summarised in Anchugov and Gladkov v Russia (Application Nos 11157/04 and 15162/05), 4 July 2013, at paras 93 100. In particular, in para 100 it distinguished between Hirst v United Kingdom (No 2) (2005) 42 EHRR 849 and Scoppola v Italy (No 3) (2012) 56 EHRR 663 in this way: 100. The principles set out in the Hirst (No 2) case were later reaffirmed in the Scoppola (No 3) [GC] judgment. The Court reiterated, in particular, that when disenfranchisement affected a group of people generally, automatically and indiscriminately, based solely on the fact that they are serving a prison sentence, irrespective of the length of the sentence and irrespective of the nature or gravity of their offence and their individual circumstances, it was not compatible with Article 3 of Protocol No 1 (see Scoppola (No 3) [GC], cited above, para 96). The Court found no violation of that Convention provision in the particular circumstances of this latter case however, having distinguished it from the Hirst (No 2) case. It observed that in Italy disenfranchisement was applied only in respect of certain offences against the State or the judicial system, or offences punishable by a term of imprisonment of three years or more, that is, those which the courts considered to warrant a particularly harsh sentence. The Court thus considered that the legal provisions in Italy defining the circumstances in which individuals may be deprived of the right to vote show[ed] the legislatures concern to adjust the application of the measure to the particular circumstances of [each] case, taking into account such factors as the gravity of the offence committed and the conduct of the offender (ibid, para 106). As a result, the Italian system could not be said to have a general automatic and indiscriminate character, and therefore the Italian authorities had not overstepped the margin of appreciation afforded to them in that sphere (ibid, paras 108 and 110). On the facts the Court held at para 101 that the position in Russia was very similar to that in Hirst (No 2), namely that the applicants were stripped of their right to vote by virtue of a provision of the Russian Constitution which applied to all persons convicted and serving a custodial sentence, irrespective of the length of their sentence and of the nature or gravity of their offence and their individual circumstances. The Court compared Hirst (No 2) at para 82 with Scoppola (No 3) at paras 105 110. The Court said at para 102 that it was prepared to accept that the relevant measure pursued the aims of enhancing civic responsibility and the respect for the rule of law and ensuring the proper functioning and preservation of civil society and the democratic regime and that those aims could not, as such, be excluded as untenable or incompatible with A3P1. The essence of the Courts decision is set out in para 103. It rejected the Governments arguments on the issue of proportionality, reiterating the point made in para 82 of Hirst (No 2), that, although the margin of appreciation is wide, it is not all embracing and added: the right to vote is not a privilege; in the twenty first century, the presumption in a democratic State must be in favour of inclusion and universal suffrage has become the basic principle. In the light of modern day penal policy and of current human rights standards, valid and convincing reasons should be put forward for the continued justification of maintaining such a general restriction on the right of prisoners to vote as that provided for in Article 32(3) of the Russian Constitution (ibid, para 79). Further, at para 105 the Court emphasised the fact that the Russian constitution imposed a blanket ban on all those imprisoned, from two months, which is the minimum period of imprisonment following conviction in Russia, to life and from relatively minor offences to offences of the utmost seriousness. At para 106 it stressed that, as in the United Kingdom, there was no evidence that, when deciding whether to impose a custodial sentence, the court should take into account the fact that the sentence would involve disenfranchisement, so that there was no direct link between the facts of a particular case and the loss of the right to vote. It recognised in para 107 that removal of the right to vote without an ad hoc judicial decision does not of itself give rise to a violation but, in response to an argument that the adoption of the Russian constitution was preceded by extensive public debate, it observed that the Government had submitted no relevant materials to support it. In doing so, it expressly followed an almost identical conclusion in para 79 of Hirst (No 2). As I see it, the thrust of the conclusions in the Strasbourg cases is that a blanket ban is disproportionate and indiscriminate, at any rate without detailed analysis of the problem because, as it is put at para 82 of Hirst (No 2), the ban applies automatically to all prisoners irrespective of the nature and gravity of the relevant offence or the individual circumstances of the particular offender. It thus applies to those sentenced to very short sentences and operates in an arbitrary way for two reasons. First, it applies in the same way to a person sentenced to 28 days or 28 years. Yet there is clearly an enormous gulf in terms of culpability between those sentenced to 28 days for, say, persistent shoplifting and those sentenced to 28 years for a very serious offence. Secondly, whether a person loses the right to vote depends upon the chance that the relevant person happens to be in prison on a particular day, by comparison perhaps with a co defendant who received an identical sentence but is on bail pending appeal. Moreover, it is difficult to see how it can be proportionate to deprive a person of a vote which is relevant to the governance of the state for a period of five years in circumstances where that person may be in prison for no more than 14 days. I appreciate that, wherever the line may be drawn, there may be an element of arbitrariness as to the choice and effect of a particular line. But there seems to me to be much to be said for the Strasbourg Courts approach to a blanket ban, at any rate absent detailed consideration of the pros and cons of such a ban. However that may be, I agree that this Court should follow the now settled jurisprudence in the Strasbourg Court for the reasons given by Lord Mance and Lord Sumption. Since writing the above, I have read the judgment of Baroness Hale in draft and would simply like to add that I agree with it. LORD SUMPTION (with whom Lord Hughes agrees) I agree with the orders proposed by Lord Mance, for all of the reasons that he gives in his judgment as well as those given in the judgment of Lady Hale. I wish to add my own observations on one question only, namely whether we should apply the principles stated by the European Court of Human Rights in Hirst (No 2) and Scoppola. It is an issue which raises in an acute form the potential conflict between the interpretation of the European Convention on Human Rights by the European Court of Human Rights and the processes by which alone laws are made in a democracy. The conflict arises from the requirement of the European Court of Human Rights that the United Kingdom should amend the Representation of the People Act 1983 so as to give at least some convicted prisoners the right to vote in national and local elections, something for which there is at present only negligible support in the House of Commons and very little among the public at large. If democracy is viewed as a system of decision making by those answerable to the electorate (as opposed to a system of values thought to be characteristic of democracies), this is bound to be a matter of real concern. Of course, as Lady Hale has pointed out, it does not follow that a democracy can properly do whatever it likes, simply by virtue of the democratic mandate for its acts. The protection of minorities is a necessary concern of any democratic constitution. But the present issue has nothing whatever to do with the protection of minorities. Prisoners belong to a minority only in the banal and legally irrelevant sense that most people do not do the things which warrant imprisonment by due process of law. In any democracy, the franchise will be determined by domestic laws which will define those entitled to vote in more or less inclusive terms. The right to vote may be based on citizenship or residence, or a combination of the two. There will invariably be a minimum voting age and may be other conditions of eligibility, such as mental capacity. In the United Kingdom, the right to vote at parliamentary and local government elections is enjoyed by Commonwealth citizens and citizens of the Republic of Ireland aged over 18, who are on the electoral roll, and not subject to any legal incapacity to vote. Inclusion on the electoral roll depends on current (or in some cases recent) residence. The only legal incapacity of any significance relates to convicted prisoners. Section 3(1) of the Representation of the People Act 1983 provides that convicted prisoners are legally incapable of voting at any parliamentary or local government election. There are limited exceptions for those committed for contempt of court or detained for default of compliance with another sentence (such as a fine). Section 8(1) and (2) of the European Parliamentary Elections Act 2002 apply the same rules of eligibility to elections for the European Parliament. These provisions are entirely clear. There is no way in which they can be read down so as to allow voting rights to any category of convicted prisoners other than those falling within the specified exceptions. The exclusion of convicted prisoners from the franchise is not a universal principle among mature democracies, but neither is it uncommon. Information provided by the Foreign Office in answer to a parliamentary question (updated to July 2012) indicates that at least 18 European countries including Denmark, Finland, Ireland, Spain, Sweden and Switzerland have no restrictions on voting by prisoners. Bulgaria, Estonia, Georgia, Hungary, Japan, Liechtenstein, Russia and the United States ban all convicted prisoners from voting, as do two of the seven Australian states. In some countries such as France disenfranchisement is reserved for those convicted of certain particularly serious offences, and in others such as Belgium for cases in which the prisoner is sentenced to a period of imprisonment exceeding a given threshold. In France, the Netherlands and Belgium disenfranchisement is an additional penalty imposed as a matter of judicial discretion. In other countries, such as Germany and Italy, it is automatic in specified cases. In Belgium, Italy and some jurisdictions of the United States, the loss of voting rights may continue even after a prisoners release. It is apparent that this is not a question on which there is any consensus. From a prisoners point of view the loss of the right to vote is likely to be a very minor deprivation by comparison with the loss of liberty. There are no doubt prisoners whose interest in public affairs or strong views on particular issues are such that their disenfranchisement represents a serious loss, just as there are prisoners (probably more numerous) whose enthusiasm for active sports makes imprisonment a special hardship. The severity of a sentence of imprisonment for the convicted person will always vary with a wide variety of factors whose impact on him or her will inevitably be arbitrary to some degree. It has been said, for example, that disenfranchisement may bear hardly on someone sentenced to, say, a short period of imprisonment which happens to coincide with a general election. For some prisoners, this will no doubt be true. But I decline to regard it as any more significant than the fact that it may coincide with a special anniversary, a long anticipated holiday or the only period of fine weather all summer. Article 3 of the First Protocol to the Human Rights Convention provides that the contracting parties undertake to hold free elections at reasonable intervals by secret ballot, under conditions which will ensure the free expression of the opinion of the people in the choice of the legislature. In 2005, the Grand Chamber of the European Court of Human Rights held in Hirst v United Kingdom (No 2) (2005) 42 EHRR 849 that a blanket restriction on voting by all prisoners violated article 3 of the First Protocol. In Greens and MT v United Kingdom (2010) 53 EHRR 710, the European Court of Human Rights delivered a pilot judgment on a large number of petitions by convicted prisoners which sought damages for the denial of their rights under article 3 of the First Protocol, consequent upon the decision in Hirst. The court refused to make an award of damages, but directed that the United Kingdom should bring forward, within six months of the date upon which the present judgment becomes final, legislative proposals intended to amend the 1983 Act and, if appropriate, the 2002 Act in a manner which is Convention compliant and effectively stayed further proceedings on pending petitions of the same kind until the expiry of that period. The deadline was subsequently extended by the European Court until six months after the judgment of the Grand Court in another case, Scoppola v Italy (No 3) (2012) 56 EHRR 663, in which the United Kingdom government proposed to intervene to make submissions about the correctness of Hirst. However, the judgment in that case, which was delivered on 22 May 2012, reaffirmed both the reasoning and the decision in Hirst. The deadline imposed by the Strasbourg Court expired in November 2012. In December 2006, in the light of the decision in Hirst, the Government published a consultation paper setting out two alternative proposals for amending section 3 of the Representation of the People Act. One was to enfranchise prisoners sentenced to less than a specified term, which would be low. , such as one year in prison. The other was to allow sentencers a discretion on whether the franchise should be withdrawn in the particular case. A further consultation paper was published in April 2009 summarising responses to the first paper and seeking views on the approach to be adopted. The Government indicated its own preference for an automatic restriction of the franchise based on the seriousness of the offence, as reflected in the length of the sentence. On 20 December 2010, after the decision of the European Court of Human Rights in Greens and MT, the Government announced that it would propose to Parliament that offenders sentenced to a term of imprisonment of less than four years would have the right to vote in parliamentary and European Parliament elections, unless the sentencing judge directed otherwise. Subsequently, the question of prisoners voting rights was debated twice. There was a Westminster Hall adjournment debate on 10 January 2011, at which many members of the House of Commons expressed strong opposition to enfranchising any prisoners. A month later, on 11 February 2011, there was an all day debate on the floor of the House of Commons on a motion put forward jointly by senior backbench MPs from both sides of the House, that legislative decisions of this nature should be a matter for democratically elected lawmakers; and supports the current situation in which no sentenced prisoner is able to vote except those imprisoned for contempt, default or on remand. This motion was carried by 234 votes to 22, both front benches abstaining. On 22 November 2012 the Government published the Voting Eligibility (Prisoners) Draft Bill (Cm 8499), setting out three options, (a) a ban on voting by prisoners sentenced to four years imprisonment or more, (b) a ban for prisoners sentenced to more than six months imprisonment, or (c) a general ban, i.e. a restatement of the present position. The explanatory memorandum accompanying the draft Bill pointed out that option (c) could not be regarded as compatible with the Convention. The draft Bill is currently being considered by a joint Select Committee of both Houses. For the moment, however, the only reasonable conclusion that can be drawn from this history is that there is no democratic mandate for the enfranchisement of convicted prisoners. It is an international obligation of the United Kingdom under article 46.1 of the Convention to abide by the decisions of the European Court of Human Rights in any case to which it is a party. This obligation is in terms absolute. The remainder of article 46 contains provisions for its collective enforcement by the institutions of the Council of Europe. Many states have written constitutions which give automatic effect in domestic law to treaties to which they are party. Constitutional provisions of this kind are generally accompanied by provisions giving the legislature a role in the ratification of treaties. But the making of treaties in the United Kingdom is an exercise of the royal prerogative. There was no legal requirement for parliamentary scrutiny until the enactment of Part 2 of the Constitutional Reform and Governance Act 2010, although pursuant to an undertaking given to Parliament in April 1924 treaties were in practice laid before Parliament and there was a recognised constitutional convention (the so called Ponsonby Rule) that this should be done. The result of the constitutional status of treaties in the United Kingdom is that they are not a source of rights or obligations in domestic law unless effect is given to them by statute: R v Secretary of State for the Home Department, Ex p Brind [1991] 1 AC 696, 747 748 (Lord Bridge of Harwich), 762 (Lord Ackner); R v Lyons [2003] 1 AC 976; In re McKerr [2004] 1 WLR 807, para 25 (Lord Nicholls of Birkenhead), para 48 (Lord Steyn), para 63 (Lord Hoffmann), para 80 (Lord Rodger of Earlsferry) and para 90 (Lord Brown of Eaton under Heywood). The Human Rights Act 1998 might have given direct legal effect to interpretations of the Human Rights Convention by the Strasbourg Court, or required the executive to give effect to them by statutory instrument. Both techniques were employed in relation to EU law by the European Communities Act 1972. But, as is well known, its drafting was a compromise designed to make the incorporation of the Convention into English law compatible with the sovereignty of Parliament. Neither of these techniques was therefore adopted. Under section 10 of and Schedule 2 to the Act, the Crown has a power but not a duty to amend legislation by order so as to conform with the Convention where there are compelling reasons for doing so, but this is subject to prior parliamentary approval under the positive resolution procedure (there are special provisions in urgent cases for an order to be made with provisional effect subject to such a resolution being passed). It follows that the interpretation of the Convention by the Strasbourg Court takes effect in English law only by decision of the English courts. Section 2(1) of the Act provides that a United Kingdom court determining a question which has arisen in connection with a Convention right must take into account any judgment, decision or declaration of the European Court of Human Rights. For this purpose Convention rights are those set out in those of its provisions to which effect is given by the Act, i.e. articles 2 to 12 and 14 of the Convention, articles 1 to 3 of the First Protocol and article 1 of the Thirteenth Protocol: see section 1(1) and (2). Whatever may be meant by taking into account a decision of the Strasbourg Court, it is clearly less than an absolute obligation. The international law obligation of the United Kingdom under article 46.1 of the Convention goes further than section 2(1) of the Act, but it is not one of the provisions to which the Act gives effect. In the ordinary use of language, to take into account a decision of the European Court of Human Rights means no more than to consider it, which is consistent with rejecting it as wrong. However, this is not an approach that a United Kingdom court can adopt, save in altogether exceptional cases. The courts have for many years interpreted statutes and developed the common law so as to achieve consistency between the domestic law of the United Kingdom and its international obligations, so far as they are free to do so. In enacting the Human Rights Act 1998, Parliament must be taken to have been aware that effect would be given to the Act in accordance with this long standing principle. A decision of the European Court of Human Rights is more than an opinion about the meaning of the Convention. It is an adjudication by the tribunal which the United Kingdom has by treaty agreed should give definitive rulings on the subject. The courts are therefore bound to treat them as the authoritative expositions of the Convention which the Convention intends them to be, unless it is apparent that it has misunderstood or overlooked some significant feature of English law or practice which may, when properly explained, lead to the decision being reviewed by the Strasbourg Court. In R v Horncastle [2010] 2 AC 373 at para 11, Lord Phillips of Worth Matravers, with the agreement of the rest of this court, rejected the submission that it should hold itself to be bound by a clear statement of principle of the European Court on the precise issue that was before it: The requirement to take into account the Strasbourg jurisprudence will normally result in the domestic court applying principles that are clearly established by the Strasbourg court. There will, however, be rare occasions where the domestic court has concerns as to whether a decision of the Strasbourg court sufficiently appreciates or accommodates particular aspects of our domestic process. In such circumstances it is open to the domestic court to decline to follow the Strasbourg decision, giving reasons for adopting this course. This is likely to give the Strasbourg court the opportunity to reconsider the particular aspect of the decision that is in issue, so that there takes place what may prove to be a valuable dialogue between the domestic court and the Strasbourg court. In Manchester City Council v Pinnock (Nos 1 and 2) [2011] 2 AC 104, para 48, Lord Neuberger MR, again with the agreement of the whole court, expanded on this statement: This court is not bound to follow every decision of the European court. Not only would it be impractical to do so: it would sometimes be inappropriate, as it would destroy the ability of the court to engage in the constructive dialogue with the European court which is of value to the development of Convention law: see e.g. R v Horncastle [2010] 2 AC 373. Of course, we should usually follow a clear and constant line of decisions by the European court: R (Ullah) v Special Adjudicator [2004] 2 AC 323. But we are not actually bound to do so or (in theory, at least) to follow a decision of the Grand Chamber. As Lord Mance pointed out in Doherty v Birmingham City Council [2009] AC 367, para 126, section 2 of the 1998 Act requires our courts to take into account European court decisions, not necessarily to follow them. Where, however, there is a clear and constant line of decisions whose effect is not inconsistent with some fundamental substantive or procedural aspect of our law, and whose reasoning does not appear to overlook or misunderstand some argument or point of principle, we consider that it would be wrong for this court not to follow that line. It follows that the exceptionally delicate issues presently before the court cannot be resolved by summarily applying the decisions of the European Court of Human Rights in Hirst and Scoppola. It is necessary to consider the basis on which the Strasbourg Court approached the relevant features of our domestic law. What is the rationale of the statutory rule excluding convicted prisoners from the franchise? In his Second Treatise of Government (1690), John Locke considered that because (as he saw it) all social obligations were ultimately founded upon implicit contract, a criminal, having repudiated that contract, had no rights. He had repudiated the collective security which was the purpose of the social contract and returned to the pre existing state of nature in which force was the only law. It followed, Locke thought, that he may be destroyed as a lion or tyger, one of those wild savage beasts, with whom men can have no society nor security. The same view was taken by others who identified the social contract as the foundation of the state, including Thomas Hobbes and Jean Jacques Rousseau. It is tempting to regard the present British rule about prisoners voting rights as a distant reflexion of this view, and plenty of commentators have succumbed to the temptation. But like most rhetoric, this is misleading. The disenfranchisement of convicted prisoners is not and never has been a form of outlawry, or civil death (the phrase sometimes used to describe the current state of the law on prisoners voting rights). On the contrary, until the 1960s, it was mainly the incidental consequence of other rules of law. In the first place, until 1870, convicted felons automatically suffered the confiscation of their real property, as a result of which they could not meet the property qualification which at that time was part of United Kingdom electoral law. The Forfeiture Act 1870 abolished the rule of confiscation. But section 2 partially preserved its effect on the franchise by providing that those sentenced for treason or felony to a period of imprisonment exceeding one year could not vote in parliamentary elections until they had served their sentence. This remained the position until the Criminal Law Act 1967 abolished the distinction between felonies and misdemeanours and amended section 2 of the Act of 1870 so that it applied only to those convicted of treason. Secondly, section 41(5) of the Representation of the People Act 1918 provided that an inmate in any prison, lunatic asylum, workhouse, poorhouse, or any other similar institution was not to be treated as resident there. This had the unintended effect of excluding from registration not only convicted prisoners, but prisoners on remand, an anomaly which was not corrected until the Representation of the People Act 2000 allowed remand prisoners to be treated as residing in the place where they were in custody. Thirdly, even those prisoners who before 1969 were eligible to vote were generally unable in practice to do so because of the absence of the necessary administrative arrangements. Except in the case of servicemen, postal voting was not introduced until the Representation of the People Act 1948, and was not available generally until the Representation of the People Act 2000. The modern law on this subject can be said to date from the Speakers Conference on Electoral Reform, which sat from 1965 to 1968 and issued its final report in February 1968 (Cmnd 3550). The conference was a non partisan body drawn from all parties in the House of Commons and meeting under the chairmanship of the Speaker. It gave systematic consideration to all aspects of electoral law including the franchise and, apparently for the first time, the question of prisoners voting rights. Only its conclusions, not its reasons, were published, but the final report records that it considered evidence and documentation from many sources. It unanimously recommended that all convicted prisoners should be ineligible to vote. This recommendation was accepted, and effect was given to it by section 3 of the Representation of the People Act 1969. The rationale of the exclusion of convicted prisoners from the franchise is as complex as the rationale for imprisonment itself. Section 142(1) of the Criminal Justice Act 2003 provides: Any court dealing with an offender in respect of his offence must have regard to the following purposes of sentencing (a) (b) (c) (d) the punishment of offenders, the reduction of crime (including its reduction by deterrence), the reform and rehabilitation of offenders, the protection of the public, and the making of reparation by offenders to persons affected by (e) their offences. All of these factors, except in the earlier period for (e), have been features of sentencing policy for very many years. For my part, I doubt whether the disenfranchisement of convicted prisoners can realistically be regarded as an additional punishment or a deterrent, and it may at least arguably be said to work against the reform and rehabilitation of the offender. But in my opinion, it has a more fundamental rationale. All criminal law, and penal policy in particular, has an important demonstrative function, which underlies all five of the statutory sentencing factors. The sentencing of offenders, and imprisonment more than any other sentence, is a reassertion of the rule of law and of the fundamental collective values of society which the convicted person has violated. This does not mean that the offender is disenfranchised because he is unpopular. Nor does it mean that he is regarded as having lost all civil rights or all claims against society, which is why the expression civil death is inappropriate. The present rule simply reflects the fact that imprisonment is more than a mere deprivation of liberty. It is a temporary reclusion of the prisoner from society, which carries with it the loss of the right to participate in societys public, collective processes. Similar principles appear to underlie the exclusion of convicted offenders from the franchise in the many other jurisdictions which practise it, whether on an automatic or a discretionary basis, and in particular those in which the suspension or abrogation of voting rights may be imposed independently of a prison sentence or continue after a term of imprisonment has been served. Fundamental to this approach, and to the automatic character of the exclusion of convicted prisoners from the franchise is the principle that sentences of imprisonment are imposed only for the more serious offences. This has always been a central feature of sentencing policy. Currently, section 152 of the Criminal Justice Act 2003, repeating previous statutory provisions and the long standing practice of the Court of Appeal (Criminal Division) provides: (2) The court must not pass a custodial sentence unless it is of the opinion that the offence, or the combination of the offence and one or more offences associated with it, was so serious that neither a fine alone nor a community sentence can be justified for the offence. The only exceptions relate either to a very few grave offences where the sentence is prescribed (such as murder, some firearms offences, repeated violence or Class A drug trafficking) or to a separate sentencing regime for dangerous repeat offenders. The section also provides that it does not apply in cases where the offender has refused to accept or comply with the conditions on which some lesser sentence would have been imposed. These principles are broadly reflected in the composition of the prison population. As Lord Mance has pointed out, only 8 per cent of persons convicted of an offence in England and 15 per cent in Scotland are sentenced to imprisonment. A statistical breakdown of the prison population as at 30 September 2010 suggests that 85% of prisoners serving sentences of less than five years were convicted of violent or sexual offences, robbery, burglary, theft, handling, fraud, forgery or drug offences. No doubt the threshold of seriousness for the passing of a sentence of imprisonment will vary in practice from one country to another. Different offences will perfectly properly be regarded as having more serious implications for some societies than for others. The United Kingdom is widely thought to have a relatively low threshold, but I am not aware that any comprehensive comparative study has been carried out which takes account of the underlying patterns of criminality. Although article 3 of the First Protocol is in unqualified terms, the jurisprudence of the Strasbourg Court has acknowledged from the outset that the right to vote may be subject to limitations of a kind which is familiar in the case law governing other Convention rights. The limitations must pursue a legitimate aim by proportionate means and must not be such as to impair the essence of the right: see Mathieu Mohin and Clerfayt v Belgium (1988) 10 EHRR 1, para 52; Matthews v United Kingdom (1999) 28 EHRR 361, para 63. It has generally been held that the essence of the right is not impaired if it does not thwart the free expression of the opinion of the people as a whole: see Holland v Ireland (Application No 24827/94) (unreported) 14 April 1998. It follows that the exclusion of certain categories of person from the franchise may be compatible with the Convention notwithstanding that as far as those persons are concerned the exclusion is total while it lasts. The case law has consistently emphasised that these are matters on which the state enjoys a wide margin of appreciation. In Hirst this was said to reflect the numerous ways of organising and running electoral systems and a wealth of differences, inter alia, in historical development, cultural diversity and political thought within Europe which it is for each Contracting State to mould into its own democratic vision (para 61). The United Kingdom government argued before the Strasbourg Court in Hirst that the objective of disenfranchisement was to serve as an additional punishment. The court accepted that that was a possible rationalisation, and regarded it as a legitimate objective, compatible with article 3 of the First Protocol. The rule was nevertheless held to be incompatible because it was disproportionate, essentially as it was an automatic blanket ban imposed on all convicted prisoners which was arbitrary in its effects and could no longer be said to serve the aim of punishing the applicant once his tariff (that period representing retribution and deterrence) had expired (para 76). The court considered the governments argument that the exclusion affected only those convicted of crimes serious enough to warrant a custodial sentence, and the very similar argument put forward by an intervener that imprisonment was the last resort of criminal justice. They appear to have rejected this argument on the facts, observing that sentences of imprisonment are imposed for a wide range of offenders and for periods from one day to life, and that because disenfranchisement was automatic the sentencer had no opportunity to assess its proportionality in any particular case (paras 77, 80). The court considered that the absolute character of the rule disenfranchising convicted prisoners and its application to all convicted prisoners put it beyond the states margin of appreciation. They were fortified in this conclusion by their view that there was no evidence that Parliament had weighed the proportionality of a general exclusion. The court referred to the Speakers Conference of 1965 1968, and the Home Office working party of 1998 1999, and acknowledged that Parliament might be said implicitly to have endorsed their conclusions: Nonetheless [they concluded] it cannot be said that there was any substantive debate by members of the legislature on the continued justification in light of modern day penal policy and of current human rights standards for maintaining such a general restriction on the right of prisoners to vote. (para 79). The court concluded as follows, at para 82: Therefore, while the court reiterates that the margin of appreciation is wide, it is not all embracing. Further, although the situation was somewhat improved by the Act of 2000 which for the first time granted the vote to persons detained on remand, section 3 of the 1983 Act remains a blunt instrument. It strips of their Convention right to vote a significant category of persons and it does so in a way which is indiscriminate. The provision imposes a blanket restriction on all convicted prisoners in prison. It applies automatically to such prisoners, irrespective of the length of their sentence and irrespective of the nature or gravity of their offence and their individual circumstances. Such a general, automatic and indiscriminate restriction on a vitally important Convention right must be seen as falling outside any acceptable margin of appreciation, however wide that margin might be, and as being incompatible with article 3 of Protocol No 1. Scoppola v Italy (No 3) (2012) 56 EHRR 663 was directly concerned with the automatic lifetime exclusion from the franchise which was the consequence under Italian law of the imposition of a sentence of life imprisonment. However, the United Kingdom rule was indirectly in question, because the Grand Chamber reviewed the decision in Hirst and the British government intervened to make submissions about it. The Chamber had held that the Italian rule violated article 3 of the First Protocol because of its automatic character. The Grand Chamber held that it was compatible with the Convention. It found that the rule pursued the legitimate aim of preventing crime and enhancing civil responsibility and respect for the rule of law (para 90). Turning to proportionality, it held that notwithstanding the statements in Hirst the test of proportionality did not require that disenfranchisement should be discretionary. It could be automatic, provided that the principles governing its imposition were sufficiently related to the gravity of the offence. The provisions of the relevant Italian law were held to be proportionate, unlike the English rule, because they disenfranchised only those convicted of particularly serious offences and those sentenced to the longer terms of imprisonment. Subject to the point about the absence of judicial discretion, the Grand Chamber reaffirmed the decision in Hirst. Accordingly, the Strasbourg Court has arrived at a very curious position. It has held that it is open to a Convention state to fix a minimum threshold of gravity which warrants the disenfranchisement of a convicted person. It has held that the threshold beyond which he will be disenfranchised may be fixed by law by reference to the nature of the sentence. It has held that disenfranchisement may be automatic, once a sentence above that threshold has been imposed. But it has also held that even with the wide margin of appreciation allowed to Convention states in this area, it is not permissible for the threshold for disenfranchisement to correspond with the threshold for imprisonment. Wherever the threshold for imprisonment is placed, it seems to have been their view that there must always be some offences which are serious enough to warrant imprisonment but not serious enough to warrant disenfranchisement. Yet the basis of this view is nowhere articulated. It might perhaps have been justified by a careful examination of the principles of sentencing in the United Kingdom, with a view to demonstrating that they involve the imprisonment of some categories of people for offences so trivial that one could not rationally suppose them to warrant disenfranchisement. That would be an indictment not just of the principle of disenfranchisement but of the sentencing principles themselves. However, no such exercise appears to have been carried out. I confess that I also find it surprising that the Strasbourg Court should have concluded in Hirst that the United Kingdom Parliament adopted the present rule per incuriam, so to speak, in 1969, without properly considering the justification for it as a matter of penal policy. The absence of debate to which the court referred reflects the attention which had already been given to the issue by the Speakers Conference, and the complete consensus on the appropriateness of the voting ban. Without the decisions in Hirst and Scoppola, I would have held that the question how serious an offence has to be to warrant temporary disenfranchisement is a classic matter for political and legislative judgment, and that the United Kingdom rule is well within any reasonable assessment of a Convention states margin of appreciation. However, the contrary view has now been upheld twice by the Grand Chamber of the European Court of Human Rights, and is firmly established in the courts case law. It cannot be said that the Grand Chamber overlooked or misunderstood any relevant principle of English law. The problems about the view which the court ultimately came to were fairly pointed out in both cases in the course of argument. Whatever parliamentary consideration may or may not have been given to the issue in 1969, it has undoubtedly received a great deal of parliamentary attention more recently, in debates which were drawn to the Grand Chambers attention in Scoppola but made no difference to its view. There is no realistic prospect that further dialogue with Strasbourg will produce a change of heart. In those circumstances, we would be justified in departing from the case law of the Strasbourg Court only if the disenfranchisement of convicted prisoners could be categorised as a fundamental feature of the law of the United Kingdom. I would regard that as an extreme suggestion, and in agreement with Lord Mance I would reject it. A wider and perhaps more realistic assessment of the margin of appreciation would have avoided the current controversy. But it would be neither wise nor legally defensible for an English court to say that article 3 of the First Protocol has a meaning different from that which represents the settled view of the principal court charged with its interpretation, and different from that which will consequently apply in every other state party to the Convention.

The appellants in these two appeals are prisoners serving sentences of life imprisonment imposed for murder, combined in the case of McGeogh with a later sentence of seven and a half years for violent escape from lawful custody. Both the appellants claim that their rights have been and are being infringed because they are not entitled to vote. United Kingdom law currently contains a general prohibition on voting by prisoners. In a series of cases (Hirst (No 2) v UK, Greens v UK and Scoppola v Italy) the European Court of Human Rights (ECtHR) has held that a blanket prohibition of this nature is an indiscriminate restriction on a vitally important right and, as such, incompatible with Article 3 of Protocol No 1 (A3P1, the duty to hold free and fair elections) of the European Convention on Human Rights (the Convention) [18 22]. The appellant Peter Chester issued a claim for judicial review in December 2008 in relation to UK and European Parliamentary elections. He relies on A3P1, as incorporated into domestic law by the Human Rights Act (the HRA), and also on European Community or now Union law (EU law). The appellant George McGeochs claim for judicial review was issued in February 2011 in relation to local and Scottish Parliamentary elections. He relies solely on EU law [1 3]. Both claims were dismissed by the courts below. The High Court and Court of Appeal held in Chesters case that it was not their role to sanction the Government for the delay in implementing the decision in Hirst (No 2) or to advise as to how the Government might implement a voting system that would be compatible with A3P1, and that EU law raised no separate issue. The Inner House dismissed McGeoghs claim on the ground that EU law only conferred a right to vote in municipal (i.e. local) elections on EU citizens residing in a Member State of which they were not nationals. The Supreme Court permitted McGeoch to add a complaint that his rights in relation to EU Parliamentary elections were also being infringed [2 3]. The issues before the Supreme Court are: (a) whether it should apply the principles established in Hirst (No 2);(b) whether, if such principles are applied, the current ban on voting is incompatible with Chesters rights under A3P1, and Supreme Court should make a further declaration of incompatibility under the HRA; (c) whether EU law recognises an individual right to vote, in terms paralleling or greater than that arising under A3P1, on which the appellants can rely upon as EU citizens claiming to vote in their own countries; and (d) what consequences would follow if EU law were to recognise an individual right to vote of this nature and, in particular, what if any relief would be available to Chester and McGeogh. The Supreme Court unanimously dismisses both appeals. Lord Mance gives the lead judgment. Lady Hale, Lord Clarke and Lord Sumption give additional judgments. With regard to claims under the Convention, the Supreme Court applies the principles in Hirst (No 2) and Scoppola regarding the blanket ban on voting, but declines to make any further declaration of incompatibility in respect of Chester [39 42]. With regard to EU law, this does not provide an individual right to vote paralleling that recognised by the ECtHR in its case law. The resolution of these appeals does not require a reference to the Court of Justice of the European Union (CJEU) [46 47, 58, 59, 63 64 and 68]. Claims under the Human Rights Act Under the HRA, the Supreme Court is required to take into account decisions of the ECtHR, not necessarily to follow them. This enables the national courts to engage in a constructive dialogue with the ECtHR. However, the prohibition on prisoner voting in the UK has now been considered by the Grand Chamber of the ECtHR twice and, on each occasion, found to be incompatible with A3P1. In these circumstances, it would have to involve some truly fundamental principle of law or the most egregious oversight or misunderstanding before it could be appropriate for the Supreme Court to refuse to follow Grand Chamber decisions of the ECtHR. The ban on prisoner voting is not a fundamental principle of law in the UK, and the circumstances do not justify a departure from the ECtHRs caselaw [25 35]. Accepting that, on the reasoning in Hirst (No 2), Chester was a victim for the purposes of the HRA and the Convention and entitled as such to bring a claim against the respondents, that does not necessarily entitle him to any particular remedy under the HRA. A declaration of incompatibility is a discretionary remedy. The incompatibility of the prohibition on prisoner voting in the UK with the Convention is already the subject of a declaration of incompatibility made in Smith v Scott and is currently under review by Parliament. In these circumstances there is no point in making a further declaration of incompatibility. This is particularly so in the case of Chester. Given that he is serving a sentence of life imprisonment, ECtHR caselaw indicates that he would not himself have a right to benefit from any amendments to the law on prisoner voting necessary to remedy the present incompatibility of UK law with the Convention [36 42]. That is so although his tariff period has expired and he remains in detention because his detention continues to be necessary for the protection of the public. Claims under EU law The provisions on voting contained in the applicable European Treaties focus on the core concerns of ensuring equal treatment between EU citizens residing in Member States other than that of their nationality, and so safeguarding freedom of movement within the EU. Eligibility to vote in Member States is basically a matter for national legislatures [58 59]. The CJEU has scrutinised national eligibility criteria for conformity with the EU legal principle of non discrimination in a context where Netherlands law extended the right to vote of its nationals to nationals resident in some, but not all, non EU States. But there is no equivalent link with EU law in the present cases [60 64]. Additional EU analysis For completeness, the Supreme Court has considered the consequences if, contrary to their conclusions, EU law were to regarded as conferring an individual right to vote on which McGeoch and Chester could rely. On that hypothesis, it considers that: The EU legal principle of non discrimination would still not be engaged. Convicted prisoners serving their sentence are not in a comparable position to persons not in prison [65 68] In any event, the general ban on prisoner voting could not have been disapplied as a whole, and the relevant domestic legislation could not have been interpreted compatibly with EU law. Nor could the Supreme Court itself have devised a scheme compatible with EU law; that would be for Parliament. Therefore, the only relief that might have been appropriate would have been a declaration that the legislative provisions governing eligibility to vote in European Parliamentary and municipal elections in the UK were inconsistent with EU law, although even that would not have appeared appropriate in the instant cases [72 74]. Neither of the appellants could have had any arguable claim for damages in respect of any breach of EU law [82 83].

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The Scottish Parliament was established by section 1 of the Scotland Act 1998. It was opened on 1 July 1999. Section 29(1) of the Act provides: An Act of the Scottish Parliament is not law so far as any provision of the Act is outside the legislative competence of the Parliament. This provision lies at the heart of the scheme of devolution to which the Act gives effect. Section 29 has to be read together with Schedule 4 which protects certain enactments from modification, and then with section 30 and Schedule 5 which defines reserved matters. These are matters reserved to the UK Parliament, and which are therefore excluded from the legislative competence of the Scottish Parliament. The area of competence that is identified by this group of provisions forms the basis for a series of sections that are designed to ensure that the Scottish Parliament confines itself to the defined areas of competence: section 31 (scrutiny of Bills before introduction), section 32 (the responsibility of the Presiding Officer), section 33 (reference of Bills to the Judicial Committee now the UK Supreme Court for scrutiny), section 35 (the power of the Secretary of State to intervene in certain cases) and sections 98 to 103 and Schedule 6 (post enactment adjudication of issues about legislative competence by the courts). The White Paper, Scotlands Parliament, Cm 3658 (1997), para 4.3, contrasted this scheme of devolution with that which had been laid down by the Scotland Act 1978, which was repealed because less than 40 per cent of the persons entitled to vote in the referendum which was required by section 85 of that Act voted in favour of it. Under that Act legislative competence was to be transferred to the Scottish Assembly in specifically defined particular groups, further defined by reference to a long list of existing statutes. That scheme, which would have required frequent updating by the UK Parliament, was seen to be incompatible with the aim that the White Paper expressed of ensuring maximum clarity and stability. While the scheme in the 1998 Act may not strike one as a model of clarity, it does appear so far to have achieved the aim of stability. Of course, harmony between the governments at Westminster and Holyrood until the May 2007 elections to the Scottish Parliament contributed to this process, as did frequent use of legislative consent motions (also known as Sewel motions, named after Lord Sewel, Parliamentary Under Secretary of State for Scotland during the passage of the Scotland Act 1998) passed by the Scottish Parliament agreeing that the UK Parliament might pass legislation on a devolved issue extending to Scotland. But it is a remarkable fact that the myriad of devolution issues that have come before the courts for determination since May 1999 have been devoted almost exclusively to the exercise of functions in criminal cases by the Lord Advocate. Logan v Harrower [2008] HCJAC 61, 2008 SLT 1049 was the first case that brought the extent of the legislative competence of the Scottish Parliament under judicial scrutiny on grounds other than compliance with Convention rights. As in the case of the appeals that are now before this court, it arose of out of a prosecution for contraventions of section 103(1)(b) of the Road Traffic Act 1988. There was no appeal against the appeal courts determination to the Judicial Committee. The question whether an Act of the Scottish Parliament is within the legislative competence of the Parliament is a devolution issue: Schedule 6, para 1(a). So it is for the courts to decide whether an Act which is challenged is within or outside competence. But the judicial function in this regard has been carefully structured. It is not for the judges to say whether legislation on any particular issue is better made by the Scottish Parliament at Holyrood or by the UK Parliament at Westminster. How that issue is to be determined has already been addressed by the legislators. It must be decided according to particular rules that the Scotland Act 1998 has laid down. But those rules, just like any other rules, have to be interpreted. That is the courts function. It is for the court to say what the rules mean and how, in a case such as this, they must be applied in order to resolve the issue whether the measure in question was within competence. These proceedings Section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provide that the offence of driving while disqualified under section 103(1)(b) of the Road Traffic Act 1988 may be prosecuted in Scotland either summarily or on indictment. As originally enacted, the maximum punishment for that offence if prosecuted summarily in Scotland was six months or the statutory maximum fine or both. If it was prosecuted on indictment in Scotland the maximum sentence was twelve months or a fine or both. By section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007, the provisions of which I shall examine in more detail later, the Scottish Parliament increased to twelve months the maximum sentence that might be imposed for this offence under the 1998 Act by the sheriff sitting summarily. That section came into force on 10 December 2007: the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Commencement No 2 and Transitional Provisions and Savings) Order 2007 (SSI 2007/479). Sean Martin was charged on summary complaint at Oban with a co accused named Rodney Cuthill. The complaint contained fourteen charges, of which charges 1, 2, 8 and 9 were directed against Martin. In charges 1 and 8 it was alleged that he drove a motor vehicle on a road while disqualified, contrary to section 103(1)(b) of the Road Traffic Act 1988, and that he committed those offences while on bail. On 14 December 2007 he pled guilty to charges 1 and 8 and to the other two charges. On 17 December 2007 he was sentenced to 12 months imprisonment on charges 1 and 8, of which four months was attributed to the fact that he committed the offences while on bail. On 12 March 2008 he presented a Bill of Suspension to the High Court of Justiciary in which he sought suspension of the sentence of imprisonment on the ground that the relevant provisions of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 were beyond the legislative competence of the Scottish Parliament. On 28 March 2008 he was granted interim liberation pending the determination of his Bill of Suspension. Ross Miller was charged on summary complaint at Stirling. The complaint contained three charges. In charge 1 it was alleged that he drove a motor vehicle on a road while disqualified, contrary to section 103(1)(b) of the Road Traffic Act 1988. On 24 April 2008 he pled guilty to charge 1 and to one of the other charges and was remanded in custody. On 14 May 2008 he was sentenced to seven months imprisonment on charge 1, back dated to 24 April 2008. On 20 June 2008 he presented a Bill of Suspension to the High Court of Justiciary in which he sought suspension of the sentence of imprisonment on the same grounds as Martin. He applied for interim liberation, but on 3 July 2008 he withdrew that application. Unlike Martin, he has now served his sentence. The two Bills of Suspension came before the appeal court for a hearing on 6 January 2009. Devolution minutes identifying the devolution issue in these proceedings had also been lodged. The court saw no reason for distinguishing these cases from its previous decision in Logan v Harrower, in which it held that the increase in the sentencing power of the sheriff sitting summarily by section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 was within the legislative competence of the Scottish Parliament. As nothing had been said to suggest that that decision was wrong, it refused to pass the Bills. It also refused the devolution minutes. On 30 January and 24 February 2009 respectively it granted the appellants leave to appeal to this court. As this narrative shows, the only reasoned decision on this issue by the appeal court is to be found in Logan v Harrower. In para 24 of that case, Lord Nimmo Smith, delivering the opinion of the court, said: We agree with the advocate depute that, in the present case, the purpose of the provision is to make Scots criminal law with regard to penalties, procedure and jurisdiction in the sheriff court apply consistently to both common law offences and statutory offences. As provided by para 3 in part I of Schedule 4 to the Scotland Act, the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to the Road Traffic Offenders Act 1988 are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin; and the modifications do not have a greater effect upon reserved matters than is necessary to give effect to the purpose of the provision in section 45. The legislative competence rules The scheme of devolution of legislative power which the Scotland Act 1998 sets out recognises that it was not possible, if a workable system was to be created, for reserved and devolved areas to be divided into precisely defined, watertight compartments. Some degree of overlap was inevitable, for the reasons explained by Lord Rodger in his discussion of the division of responsibility on matters of policy; see paras [73] and [74]. This is a familiar phenomenon in the case of federal systems such as those in Canada and Australia, where legislative competence is divided between the Dominion and the Provinces or the Commonwealth and the States. In Prafulla Kumar Mukherjee v Bank of Commerce Ltd, Khulna (1947) LR 74 Indian Appeals 23 the Judicial Committee rejected the argument that the principles which obtain in Canada and Australia had no application in India. Lord Porter gave this explanation at p 42: It is not possible to make so clean a cut between the powers of various legislatures: they are bound to overlap from time to time. The rule that was evolved by the Judicial Committee was to examine the statute that was impugned to ascertain its pith and substance, or its true nature and character, to determine whether it was legislation with respect to matters that were in the prohibited or permitted sphere. The phrase pith and substance was first used by Lord Watson in Union Colliery Co of British Columbia Ltd v Bryden [1899] AC 580, 587. The phrase true nature and character was first used in Russell v The Queen (1882) 7 App Cas 829, 839 840. The principles that these phrases embody are sometimes referred to, by a word that went out of fashion in mediaeval times, as the respection doctrine. In Prafulla Kumar Mukherjee v Bank of Commerce Ltd, Khulna having referred to the rule and found that it applied to Indian as well as Dominion legislation, Lord Porter went on to say this at p 43: No doubt experience of past difficulties has made the provisions of the Indian Act more exact in some particulars . But the overlapping of subject matter is not avoided by substituting three lists for two, or even by arranging for a hierarchy of jurisdictions. Subjects must still overlap, and where they do the question must be asked what in pith and substance is the effect of the enactment of which complaint is made, and in what list is its true nature and character to be found. If these questions could not be asked, much beneficent legislation would be stifled at birth, and many of the subjects entrusted to provincial legislation could never effectively be dealt with. The same point had already been made by Lord Atkin in Gallagher v Lynn [1937] AC 863, which was an appeal from Northern Ireland. Section 4 of the Government of Ireland Act 1920 provided that the Parliament of Northern Ireland had power to make laws for the peace, order and good government of Northern Ireland, but not to make laws in respect of, among other things, trade with any place out of Northern Ireland. He held that an Act regulating the supply of milk in Northern Ireland which imposed controls on every person who within Northern Ireland sold or exposed for sale milk, whether produced within or without the territory of Northern Ireland, was a law for the peace, order and good government of Northern Ireland in respect of precautions taken to secured the health of its inhabitants, not a law in respect of trade. At p 870, explaining what was meant by the pith and substance doctrine, he said: If, on the view of the statute as a whole, you find that the substance of the legislation is within the express powers, then it is not invalidated if incidentally it affects matters which are outside the authorized field. The legislation must not under the guise of dealing with one matter in fact encroach upon the forbidden field. Nor are you to look only at the object of the legislator. An Act may have a perfectly lawful object, eg to promote the health of the inhabitants, but may seek to achieve that object by invalid methods, eg a direct prohibition of any trade with a foreign country. The rule that was evolved and applied in these cases, among others, provides the background to the scheme that is now to be found in the Scotland Act. It was referred to at the committee stage in the House of Lords by Lord Sewel: Hansard HL Debates (21 July 1998), vol 592, col 818 et seq. The scheme seeks to give effect to the rule. Lord Sewel, recognising that a degree of trespass into reserved areas was inevitable, said that it was intended that any argument as to whether a provision in an Act of the Scottish Parliament relates to a reserved matter must be decided by reference to its pith and substance or its purpose and if its purpose is a devolved one it is not to be outside legislative competence merely because it affects a reserved matter: col 819. The question whether that aim has been achieved must be determined by examining the provisions of the Scotland Act in which the scheme is laid out. While the phrase pith and substance was used while these provisions were being debated, it does not appear in any of them. The idea has informed the statutory language, and the rules to which the court must give effect are those laid down by the statute. As to what they mean, the Scotland Act provides its own dictionary. Section 29, which must now be quoted in full, provides as follows: (1) An Act of the Scottish Parliament is not law so far as any provision of the Act is outside the legislative competence of the Parliament. (2) A provision is outside that competence so far as any of the following paragraphs apply (a) it would form part of the law of a country or territory other than Scotland, or confer or remove functions exercisable otherwise than in or as regards Scotland, (b) it relates to reserved matters, (c) it is in breach of the restrictions in Schedule 4, (d) it is incompatible with any of the Convention rights or with Community law, (e) it would remove the Lord Advocate from his position as head of the systems of criminal prosecution and investigation of deaths in Scotland. (3) For the purposes of this section, the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter is to be determined, subject to subsection (4), by reference to the purpose of the provision, having regard (among other things) to its effect in all the circumstances. (4) A provision which (a) would otherwise not relate to reserved matters, but (b) makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. The paragraphs of section 29(2) that require to be examined in this case are paras (b) and (c). The first question is whether section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 relates to a reserved matter. Reserved matters are the matters reserved to Westminster by section 30(1) of the Scotland Act, which gives effect to the list of matters in Schedule 5. Para 1 of Part II of Schedule 5 provides that the matters to which any of the sections in the Part apply are reserved matters for the purposes of the Act. Head E Transport lists among the subject matter of section E1, which applies to Road Transport, the following: (d) the Road Traffic Act 1988 and the Road Traffic Offenders Act 1988. Section 45 of the 2007 Act does not refer expressly to any of the provisions of the Road Traffic Act 1988 or the Road Traffic Offenders Act 1988. But, as it applies to offences under enactments passed before the 2007 Act generally, it must be taken to refer to them by implication. Their subject matter is a reserved matter. The question whether a provision relates to a reserved matter in terms of section 29(2)(b) is to be determined by reference to the purpose of the provision, applying the rule set out in section 29(3). This rule lays down the primary test of what is meant by purpose. But it is necessary to have regard also to section 29(4) which deals with a special category of overlap between reserved matters and matters which are not reserved that is in point in this case. This is because section 126(5) of the Scotland Act provides that references in the Act to Scots criminal law include criminal offences, jurisdiction, evidence, procedure and penalties and the treatment of offenders, and because section 45 of the 2007 Act deals with what the head note to Part 3 of that Act refers to as penalties. The list of reserved matters has been drawn up by reference to different aspects of executive or governmental responsibility. But the spheres of activity embraced by Scots private law and Scots criminal law, which are not reserved, do not respect those boundaries. They extend across all of them. The regulation of both devolved matters and reserved matters within Scotland is likely to involve questions of Scots private law and Scots criminal law. Section 29(4) does not apply if, applying the test laid down by section 29(2), the provision in question has already been found otherwise to relate to a reserved matter. That is the effect of para (a) of this subsection. It does apply, however, if it makes modifications of Scots private law or Scots criminal law as it applies to reserved matters: para (b). Here too the boundary between what is reserved and what is not reserved is to be determined by applying a purpose test. The key word here is consistently. If the purpose is to make the relevant rule of Scots criminal law apply consistently to reserved matters and otherwise, it will pass the test. The provision will not then fall to be treated as relating to a reserved matter, and thus outside the legislative competence, because it is caught by section 29(2)(b). The question whether the provision is in breach of any of the restrictions in Schedule 4 must also be addressed in this case. The paragraphs in that Schedule that need to be considered are paras 2 and 3, which so far as relevant provide as follows: 2 (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent to that the rule in question is special to a reserved matter 3 (1) Paragraph 2 does not apply to modifications which (a) are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and (b) do not have a greater effect on reserved matters than is necessary to give effect to the purpose of the provision. (2) In determining for the purposes of sub paragraph (1)(b) what is necessary to give effect to the purpose of a provision, any power to make laws other than the power of the Parliament is to be disregarded. There is obviously some duplication between section 29 and the provisions of this Schedule. At first sight, paragraph 2(1) declares what the reader already knows, having studied section 29(4). But, in contrast to section 29(4) which deals with the question whether a provision relates to a reserved matter, para 2(1) refers to the law on reserved matters. The meaning of this expression is set out in para 2(2)(a). The starting point is that the law on reserved matters as a whole is protected from modification by the Scottish Parliament. This appears to withdraw the protection that is given by section 29(4) to modifications of a rule of Scots private law or Scots criminal law as it applies to reserved matters whose purpose was to make the law apply consistently to reserved matters and otherwise. But paragraph 2(1) is itself qualified by the opening words of paragraph 2(3). The words is special to a reserved matter are the key words in this subparagraph. The contrast which they suggest is between a rule of Scots criminal law which is special to a reserved matter on the one hand and one which is general in its application on the other because it extends to both reserved matters and matters which have not been reserved. There is a strong family likeness between the two tests, as Lord Walker says: see para [54]. But a modification which survives the test in section 29(4) will have to pass the tests in Schedule 4: section 29(2)(c). If it passes the test in paragraph 2(3), paragraph 2(1) will not apply. It will have no need of the protection that is given by paragraph 3 to modifications that fall within the scope of that paragraph. This analysis shows that the questions which lie at the heart of this case are: (1) whether the purpose of section 45 was to make a modification to Scots criminal law as defined in section 126(5); (2) if so, whether its purpose was to make the law apply consistently to reserved matters and otherwise; and (3) if it passes those tests, whether the rule that it sought to modify was special to a reserved matter within the meaning of paragraph 2(3) of Schedule 4. Section 45 of the 2007 Act Section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 is one of a group of sections dealing with sentencing powers which appear in Part 3 of the Act under the heading Penalties. Two sections require to be noticed in addition to section 45. First there is section 43, which deals with common law offences. It amends section 5 of the Criminal Procedure (Scotland) Act 1995, which deals with the sheriffs summary jurisdiction and powers, in two respects: in section 5(2)(d), the power to impose imprisonment is raised from any period not exceeding three months to twelve; and section 5(3) is repealed. Secondly, there is section 44, which increases the maximum sentence of imprisonment for a list of particular summary only statutory offences which had attracted a maximum sentence in excess of the previous common law maximum but were below the new maximum of twelve months for offences dealt with summarily. Section 45 is headed Other statutory offences. It is not necessary for the purposes of this case to quote it in full. The provisions that are relevant provide as follows: (1) The maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence is, by virtue of this subsection, 12 months. (2) Accordingly, the specification of a maximum period of imprisonment in every relevant penalty provision is, in relation to any relevant offence to which it applies, to be read subject to subsection (1). (3) Without prejudice to subsections (1) and (2), the Scottish Ministers may by order amend the specification of a maximum term of imprisonment in a relevant penalty provision so as to specify, in relation to the relevant offence to which it applies, that the maximum term of imprisonment to which a person is liable on summary conviction is 12 months. (6) In this section, a relevant offence is an offence under a relevant enactment or instrument which is (a) triable either on indictment or summary complaint, and (b) punishable on summary conviction with a maximum term of imprisonment of less than 12 months. (7) In this section a relevant enactment is an Act passed before this Act It is common ground that the Road Traffic Offenders Act 1988 is a relevant enactment and that a contravention of section 103(1)(b) of the Road Traffic Act 1988 is a relevant offence for the purposes of this section. What was the purpose of section 45? Section 29(3) of the Scotland Act provides that, when consideration is being given to the purpose of the provision, regard is to be had to its effect in all the circumstances. One of the circumstances to which it is proper to have regard is the situation before the provision was enacted, which it was designed to address. Reports to and papers issued by the Scottish Ministers prior to the introduction of the Bill, explanatory notes to the Bill, the policy memorandum that accompanied it and statements by Ministers during the proceedings in the Scottish Parliament may all be taken into account in this assessment. The sentencing powers of the sheriff, sitting as a court of summary jurisdiction, are regulated by statute. Section 7(5) of the Criminal Procedure (Scotland) Act 1995 provides that a stipendiary magistrate shall have the summary criminal jurisdiction and powers of a sheriff. Prior to the commencement of the Criminal Proceedings etc (Reform) (Scotland) Act 2007, section 5(2) of the 1995 Act provided inter alia as follows: The sheriff shall, without prejudice to any other or wider powers conferred by statute, have power on convicting any person of a common law offence . (d) to impose imprisonment, for any period not exceeding three months. Section 5(3) of the 1995 Act provided that the maximum sentence for a second or subsequent offence involving violence or dishonesty was six months. The effect of these provisions was that the power of the sheriff or stipendiary magistrate to impose a sentence of imprisonment was limited to a maximum of three months in the case of common law crimes (except in the case of certain types of repeat offences) and, in the case of statutory offences, to the maximum laid down by the relevant statute. In the case of a contravention of section 103(1)(b) of the Road Traffic Act 1988, section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provided that the maximum if the offence was prosecuted summarily in Scotland was six months. In November 2001 the Minister of Justice appointed a committee under Sheriff Principal John McInnes QC to review the provision of summary justice in Scotland, including the structures and procedures of the sheriff courts and the district courts as they related to summary business and the inter relation between the two levels of court, and to make recommendations for the more efficient and effective delivery of summary justice in Scotland. In the report which it presented to Ministers in January 2004 the Summary Justice Review Committee identified a need to relieve pressure on the higher courts. This implied a need to move cases from the High Court of Justiciary to the sheriff and jury court, and in turn a need to move cases from the sheriff and jury court to summary procedure. In para 7.87 of its report it recommended that, to equip summary judges with the disposals that would be necessary to deal with cases that would be heard summarily in the future, the criminal jurisdiction of judges sitting summarily should be increased to a maximum of twelve months detention or imprisonment or a 20,000 fine. Having consulted on this recommendation among other proposals, the Scottish Ministers decided to accept it. In March 2005 the Minister for Justice published Smarter Justice, Safer Communities Summary Justice Reform Next Steps (Scottish Executive, March 2005). In para 4.10 reference was made to the recommendations that the Committee had made which were designed to promote case handling at a more appropriate level: Recognising the pressures on the solemn system, the Committee recommended that the sentencing powers of a sheriff sitting without a jury should be raised to one year in custody or a fine of 20,000, enabling the transfer of the least serious solemn business to the summary courts In para 4.50 it was stated that it was proposed to implement the reports recommendations in relation to the custodial sentencing powers of sheriffs sitting summarily. The Criminal Proceedings etc (Reform) (Scotland) Bill was introduced into the Scottish Parliament in February 2006. In para 186 of the explanatory notes to the Bill it was said of section 35 (which became section 45 when the Bill was passed) that it brought the maximum summary prison sentences for certain statutory offences into line with the new maximum sentence for common law offences set out in what is now section 43 of the Act. In the Policy Memorandum which accompanied the Bill it was stated in para 6 that the Bill made provision in eight main policy areas, including: increases in the criminal sentencing powers of the summary courts, ensuring that those courts can deal with an appropriate range of cases in terms of both severity and caseload, and do so more quickly than is currently the case. In para 206 it was stated that the Executive believed that professional sheriffs should be able to deal with a wider range of cases under summary procedure than they were currently entitled to, including some that would attract a higher penalty. The theme that is apparent from these earlier documents was picked up by the Justice 1 Committee in its report on the general principles of the Bill: Justice 1, 10th Report 2006, Stage 1 Report on Criminal Proceedings etc (Reform) (Scotland) Bill, 5th July 2006. In para 293 of its report the Committee said that one of the principal drivers for the reforms proposed by the Bill was that justice should be dispensed at the appropriate level and that this meant, among other things, the granting of significantly increased sentencing powers to sheriffs sitting without a jury. In para 294 it said that it broadly accepted that there was merit in some cases being dealt with at lower levels of the judicial system than was the case at present. Introducing the stage 1 debate in the Parliament on 14 September 2006, the Minister for Justice said that the Bill made a number of changes to the detailed law of criminal procedure, that each of these changes played its part in speeding up the system as a whole, that the Bill would ensure that increased sentencing powers for sheriffs would ease the pressure on the higher courts and that the bill was to be regarded as part of the executives wider work to reform the summary justice system: Scottish Parliament Official Report, cols 27664 6. In my opinion this material shows conclusively that the purpose of section 45 of the 2007 Act was to contribute to the reform of the summary justice system by reducing pressure on the higher courts. An increase in the sentencing powers of sheriffs when they were dealing with statutory offences was seen as a necessary of this process. The jurisdiction of the sheriff sitting summarily is defined by reference to the penalties that the sheriff can impose. These are pre eminently matters of Scots criminal law: see section 126(5). As it was to a rule of Scots criminal law that the provision was directed, I would hold that it does not relate to a reserved matter within the meaning of section 29(2)(b). Was it to make the law apply consistently? Section 45 of the 2007 Act forms part of a group of sections, all directed to a reform or modification of the sentencing powers of the sheriff sitting summarily. The leading provision is section 43, which increased the maximum sentence for common law offences from three (or, in the case of some repeat offences, six) months to twelve months. It is obvious however that to have left the matter there would have led to an imbalance in the system between how common law offences were to be dealt with on the one hand and how statutory offences were to be dealt with on the other. The reform that this would have achieved would have been incomplete and confusing. To achieve its object it had to be extended across the board to statutory offences as well. To draw a line between statutory offences relating to reserved matters and those relating to matters that were not reserved would have been even more confusing. When they were dealing with an offence created by a United Kingdom statute, prosecutors and sheriffs would have had to check in each case whether they were on the right side of the line. Statutory offences of all kind form a large part of the diet of the summary courts. To achieve a complete and worthwhile reform of the summary justice system a modification of the sentencing power across the whole range of statutory offences was required. In my opinion the purpose of the modification in section 45 must be taken to have been to make the law relating to the increased sentencing power of the sheriff sitting summarily apply consistently to reserved matters and otherwise. I would hold that section 45 is not to be treated as relating to a reserved matter under section 29(4). Is the rule special to a reserved matter? The question that must now be addressed is that set out in para 2(3) of Schedule 4: is the rule of Scots criminal law that the Act seeks to modify special to a reserved matter? To answer it, one must first identify the rule of Scots criminal law that is being modified. Then one must ask whether that rule is special to a reserved matter. Identifying the rule is a crucial step towards reaching the right answer to the question whether the modification that is proposed is within the competence of the Scottish Parliament or must be dealt with at Westminster. I agree with Lord Rodger that, unlike section 29(3) and (4), para 2 of the Schedule concentrates on the rule of law that is being modified by the enactment and makes no mention of the purpose of the modification: see para [122]. But the purpose of the enactment may nevertheless be referred to in order to identify the rule of law that is being modified. I think that it is clear that any modification of the maximum punishment that can be imposed for the offences that the road traffic legislation has created must be held to be a matter for the United Kingdom Parliament at Westminster. The rule of Scots law as to the maximum term of imprisonment that can be imposed would fall to be treated as a rule that was special to a reserved matter. So would any other limits on the extent of the penalties or as to the scope of offences that the Road Traffic legislation lays down. The Calman Report, Serving Scotland Better: Scotland and the United Kingdom in the 21st Century, June 2009, considered in paras 5.167 181 certain aspects of road traffic regulation including drink driving limits and speed limits. As the authors of the report were right to recognise, under the current legislation any alteration to those limits that might be thought to be acceptable in Scotland would not be within the legislative competence of the Scottish Parliament. Some concern was expressed during the progress of the Bill as to whether this reform might lead to what was referred to as sentence drift a tendency on the part of sheriffs to impose higher sentences for these offences than they would previously have regarded as appropriate. But it is plain that this was not what the reform was intended to do, and there is no evidence that this has in fact happened. So I do not think that it would right to say that the purpose of section 45 was to achieve an overall increase in the sentences that sheriffs were imposing. Had that been the purpose, it would have gone some way to identifying the rule of law that was being modified. As it is, the rule cannot be identified by that route. Section 33 of and Part I of Schedule 2 to the Road Traffic Offenders Act 1988 provide that the maximum sentence of imprisonment for the offence under section 103(1)(b) of the Road Traffic Act 1988 if prosecuted summarily in Scotland is six months and that it is twelve months if prosecuted in Scotland on indictment. They contain, in effect, two rules of Scots criminal law. One is a rule as to the overall maximum sentence, which is twelve months imprisonment. That, plainly, is a rule which is special to the Road Traffic Acts and it is a reserved matter. The other is a rule about Scots criminal jurisdiction and procedure, which is not reserved. It is that rule which determines the procedure under which the maximum sentence can be imposed. The purpose of the modification that section 45 makes is to enable more statutory offences to be prosecuted summarily. The maximum sentence of imprisonment for the offence if prosecuted in Scotland remains twelve months. The modification relates to the procedure which determines whether the sheriff has jurisdiction to impose the maximum sentence. It extends the power that is given to him when he is sitting summarily. It seems to me therefore that the rule of Scots law that is being modified is the rule of procedure, not the rule of Scots law as to the maximum sentence for the offence. The rule of procedure is a rule that applies generally to the way cases are dealt with in the sheriff court. It is not special to the Road Traffic Offenders Act 1988. The purpose of para 2(3) of Schedule 4 to the 1998 Act, as I understand it, is to avoid the fragmentation of rules of Scots criminal law which are of general application into some parts which are within the Scottish Parliaments competence and some parts which are not. It is, of course, the case that the difference between the maximum sentence that could be imposed by a sheriff sitting summarily and that which could be imposed by him in solemn proceedings was prescribed in Schedule 2 to the Road Traffic Offenders Act 1988. But in doing so the Schedule was basing itself on a distinction between two forms of Scots criminal procedure which apply generally. I think that it was within the competence of the Scottish Parliament to extend its general reform of that procedure to the forms of procedure referred in this and other statutes that deal with reserved matters, otherwise fragmentation would occur. I am not confident that it helps to reason by way of examples. Each case must be taken on its own merits. In case of doubt, the words to the extent only suggest that a generous application of para 2(3) which favours competence is to be preferred, as opposed to one which applies it narrowly. And the key to the decision in this case lies in identifying the rule in question, which is achieved by examining the purpose of the provision which is under scrutiny. One could, of course, say that Schedule 2 contains two maximum sentences, one for summary proceedings and the other for proceedings on indictment, and that as both are reserved matters it was not open to the Scottish Parliament to alter either of them. But that, in my opinion, would be to carry the process of analysis too far. The word special indicates that, in cases such as this where the decision depends on the exercise of judgment, the purpose of the provision may be the best guide. So, in agreement with Lord Walker and Lord Brown and respectful disagreement with Lord Rodger and Lord Kerr, I would hold that section 45 was not directed to a rule which was special to a reserved matter within the meaning of para 2(3) of Schedule 4, that para 2(1) of the Schedule does not apply, that it survives scrutiny under section 29(2)(c) and there is no need to refer to para 3. Had it been necessary to refer to para 3, I would have held that section 45 of the 2007 Act was not saved by it. On this point I disagree with the appeal court in Logan v Harrower. A decision as to the procedure under which a sentence of more than six months could be imposed was not a modification of an incidental or consequential nature. It was an important change in the procedure which one would expect to see set out in the body of the enactment, not in a schedule of the kind that generally deals with matters that are merely incidental or consequential on provisions found elsewhere in the enactment. Section 104 of the Scotland Act enables Her Majesty in Council or a Minister of the Crown, with the consent of both Houses of the United Kingdom Parliament, to make such provision as is considered necessary or expedient in consequence of any provision made by or under any Act of the Scottish Parliament. As the explanatory notes to that section point out, the power to make provision consequential on legislation under paragraph 3 of Schedule 4 is very limited. Among other things, it does not enable the Scottish Parliament to legislate otherwise than as a matter of Scots law. It does not have power under that provision to make any consequential provisions that require to take effect elsewhere in the United Kingdom. Examples of the use that is made of the power under section 104 are to be found in the Adults with Incapacity (Scotland) Act 2000 (Consequential Modifications) (England, Wales and Northern Ireland) Order 2005 (SI 2005/1790) and the Police, Public Order and Criminal Justice (Scotland) Act 2006 (Consequential Provisions and Modifications) Order 2007 (SI 2007/1098). There are many others. Lord Rodger in para [81] has mentioned some of them. The use of section 104 is not confined to cross border matters. The power was used in connection with the reforms introduced by the 2007 Act to make the powers to impose sanctions under the Road Traffic Offenders Act 1988 available in the justice of the peace courts that were to be established under the 2007 Act, and to make the same powers available in the district courts during the phased introduction of the justice of the peace courts: see the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007 (SI 2007/3480). I agree with Lord Rodger that the scheme for adjusting the sheriffs summary criminal jurisdiction in relation to statutory offences could have been dealt with in this way, had this been thought to be necessary. But the modification that was required in their case was to a procedural route that was already available for dealing with these offences in the sheriff court. For the reasons that I have given I consider that the judgment that was made that the modification was within the legislative competence of the Scottish Parliament was correct, and that the use of the section 104 power was not necessary. Conclusion The result of this analysis is that section 45 of the 2007 Act survives scrutiny. Endorsing what the appeal court decided in Logan v Harrower but differing from it as to the reason why the section is not in breach of the restrictions in Schedule 4, I would hold that the provision is within the legislative competence of the Scottish Parliament. I would therefore dismiss these appeals. Bearing in mind that the appellant Martin who is on interim liberation has not yet served the sentence that the sheriff imposed on him, I would remit both cases to the appeal court for any further orders that may be required. Had I been in favour of allowing the appeals I would have made an order under section 102(2)(a) of the 1998 Act removing the retrospective effect of the decision that, so far as it purports to modify the penalty provision for a contravention of section 103(1)(b) of the Road Traffic Act 1988 in Part I of Schedule 2 to the Road Traffic Offenders Act 1988, section 45(2) of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 is outside the competence of the Scottish Parliament. I would also have made an order under section 103(2)(b) suspending its effect for two months to allow the defect to be corrected as it seems to me that, in a case of this kind, these two orders go hand in hand. LORD WALKER The Scotland Act 1998 is on any view a monumental piece of constitutional legislation. Parliament established the Scottish Parliament and the Scottish Executive and undertook the challenging task of defining the legislative competence of the Scottish Parliament, while itself continuing as the sovereign legislature of the United Kingdom. That task is different from defining the division of legislative power between one federal legislature and several provincial or state legislatures (as in Canada or Australia, whose constitutional difficulties the Judicial Committee of the Privy Council used to wrestle with, often to the dissatisfaction of those dominions). The doctrine of pith and substance mentioned by Lord Hope in his judgment is probably more apt to apply to the construction of constitutions of that type. But both have to face the difficulty of defining (necessarily in fairly general and abstract terms) permitted or prohibited areas of legislative activity. The difficulties (viewed from the perspective of Northern Ireland) are discussed in Harry Calverts Constitutional Law in Northern Ireland, which, though written as long ago as 1968, still provides a very helpful commentary. It shows how different forms of words have come to be recognised as indicating a more or less proximate (or direct, or crucial) connection between a proposed enactment and an area of legislative activity. Calvert quotes (from an unidentified source), at pp 180 181, the argument of the Attorney General for Northern Ireland when Lynn v Gallagher [1937] AC 863 was before the House of Lords: The crux of this whole legislation lies in three words, the words in respect of used in section 4(1) of the Government of Ireland Act, 1920. These three words are the apt words to indicate the true subject matter of an enactment but they are not, we submit, the apt words to indicate merely the results of an enactment. They are possibly rather stronger than a word such as concerning, and than the phrase in relation to, but they certainly must have a different meaning, unless they may be construed contrary to the general use of language, from the word affecting. In the British North America Act the words used are in relation to and these words in respect of do not occur in it. We submit that these words in respect of are no weaker than the words there used. Calvert also quotes, at p 179, Higgins J in McArthur Ltd v Queensland (1920) 28 CLR 530, 565: We have to determine in each case what is the subject of the legislation what subject is the Act with respect to what it effects not what things or operations it may indirectly affect. These background matters must have been in the mind of those who undertook the drafting of the Scotland Act (and in particular the provisions directly relevant to these appeals). But in the Scotland Act Parliament has gone further, and has used more finely modulated language, in trying to explain its legislative purpose as regards reserved matters. The Court has to consider two groups of provisions, each of which has a particular nexus with reserved matters as defined in Schedule 5 of the Act. The first group of provisions consists of section 29(2)(b) as explained and qualified by subsections (3) and (4). The second group consists of section 29(2)(c) and Schedule 4, paras 2 and 3. All these provisions are set out in Lord Hopes judgment (paras 16 and 20) and I need not repeat them. But it is worth considering the manner in which reserved matters are defined in Schedule 5 (to which both groups of provisions are linked). Schedule 5, Part I, contains general reservations: the constitution, political parties, foreign affairs, public service, defence and treason. Part II then contains specific reservations under eleven heads (themselves elaborately subdivided and made subject to exceptions). Although termed specific, some of these are expressed in general terms. For instance, Head A1, Fiscal, economic and monetary policy, is as follows: Fiscal, economic and monetary policy, including the issue and circulation of money, taxes and excise duties, government borrowing and lending, control over United Kingdom public expenditure, the exchange rate and the Bank of England. Exception Local taxes to fund local authority expenditure (for example, council tax and non domestic rates). Many of the specific reservations in Part II are expressed as the subject matter of a particular statute (or part of a statute). For example Head E.1, Road Transport, includes The subject matter of . (d) the Road Traffic Act 1988 and the Road Traffic Offenders Act 1988 (subject to an exception for a few sections of the Road Traffic Act 1988). The use of the expression subject matter has been described (in an unsigned editorial in (1998) 19 Statute Law Review v) as an elegant drafting device but as having potential difficulties. So I come back to the first group of provisions, consisting of subsection (2)(b) of section 29 as explained and qualified by subsections (3) and (4). Its structure appears reasonably straightforward. Section 29(2)(b) prohibits legislation by the Scottish Parliament which relates to reserved matters. That is an expression which is familiar in this sort of context, indicating more than a loose or consequential connection, and the language of section 29(3), referring to a provisions purpose and effect, reinforces that. Section 29(4) adds to the reach of section 29(2) (as is clear from section 29(4)(a)) as regards modifications of Scots private law, or Scots criminal law, as it applies to reserved matters. Scots private law and Scots criminal law are widely defined in section 126 (4) and (5). Paragraph 29(4)s default position is restrictive: the modification is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. Here the law in question must mean the relevant rule of Scots private law or Scots criminal law. The second group of provisions consists of section 29(2)(c) and Schedule 4, paras 2 and 3. Para 2(1) contains a general prohibition on modification (including amendment or repeal) of the law on reserved matters, that composite expression being defined in sub paragraph (2) by reference to the subject matter of an enactment or non statutory rule. So reading Schedule 4, para 2(1) and (2) together with Schedule 5, Part II, Head E1(d), we see that (if those provisions stood alone) an Act of the Scottish Parliament could not modify the Road Traffic Offenders Act 1988, because the subject matter of that Act is a reserved matter. As I understand it the Court is agreed (although not for identical reasons) that the legislation now in point, section 45 of the Criminal Proceedings etc (Reform)(Scotland) Act 2007, does not infringe section 29(2)(b) of the Scotland Act. The Court is however divided as to the effect of section 29(2)(c). Lord Rodger and Lord Kerr take the view that section 45 of the 2007 Act infringes section 29(2)(c) and Schedule 4, para 2 (being special to a reserved matter for the purposes of para 2(3) and not being saved by para 3, relating to incidental or consequential modifications). I agree that para 3 is not in point. The crucial provision is para 2(3). But it is important, in my view, to try and see it as part of a rational and coherent scheme defining the legislative competence of the Scottish Parliament. That is easier said than done, as the division within the Court indicates. When I first studied this second group of provisions I got the impression that they replicated, but in different language, the effect of what I have called the first group of provisions, and that it was hard to discern the legislative scheme or purpose underlying this. I still have difficulty with this. But I think the answer may be that section 29(2) is dealing comprehensively with the scope of any new legislation enacted by the Scottish Parliament, whereas Schedule 4 is (as its heading indicates) concerned with the protection of some existing legislation (or some non statutory rule of law) which has a reserved matter as its subject matter. However the statute book is already so heavily burdened that almost any new legislation is likely to modify existing legislation, and in Scotland a lot of new legislation will have the effect of modifying Scots private law or Scots criminal law. So in most cases both groups of provisions will be in point. Section 29(4) is concerned with a provision which makes a modification to Scots private law or Scots criminal law as it applies to reserved matters; in that case it is necessary to enquire whether its purpose is to make the law in question apply consistently to reserved matters and otherwise (that is, to non reserved matters). Schedule 4, para 2(3) is concerned with the modification of a rule of Scots private law or Scots criminal law to the extent that the rule in question is special to a reserved matter. There is to my mind an obvious degree of affinity between these two enactments, in that a provision intended to produce consistency in a rules application across the board (that is, to reserved matters and non reserved matters alike) is unlikely to apply to a rule which is special to a reserved matter. Special is to be contrasted with general and a measure intended to produce consistency across the board is general by its very nature. The two statutory tests are not identical (if Parliament had intended them to be identical it would no doubt have used the same words in each). Nevertheless they have a strong family likeness, and it would be rather surprising if a provision came within the legislative competence of the Scottish Parliament under section 29(4) but failed on the test in Schedule 4, paragraph 2(3). In applying each test it is necessary to identify the rule of Scots criminal law which is to be modified. It is to be found in sections 9 and 33 of, and Schedule 2 to, the Road Traffic Offenders Act 1988, so far as they apply to an either way offence under section 103(1)(b) of the Road Traffic Act 1988 committed in Scotland. These provisions are part of Scots criminal law, and they relate (almost by definition, having regard to the wording of Head E1(d)) to a reserved matter. It is also necessary to identify the purpose of the provision which makes the modification, that is section 45 of the 2007 Act. Its purpose was (as Lord Hope says in his judgment, para [31]) to contribute to the reform of the summary justice system by reducing pressure on the higher courts. An increase in the sentencing powers of sheriffs when they were dealing with statutory offences was seen as a necessary of this process. Similarly in Lord Rodgers view (para [105]) it was to introduce a novel, general, provision for determining the maximum term which a sheriff, sitting as a court of summary jurisdiction, could impose by way of imprisonment in respect of either way statutory offences which had previously attracted a maximum sentence of less than 12 months imprisonment. Lord Rodger gives a very similar explanation of the purpose of section 45 in para [113] of his judgment. In my opinion this statutory purpose includes achieving consistency in the sheriffs sentencing powers, on summary conviction, as between reserved and non reserved matters. Lord Rodger accepts this in para [116] of his judgment, but reaches a different conclusion on the similar point (not, I accept, exactly the same point) arising under Schedule 4, paragraph 2(3). I would accept that on my interpretation both section 29(4) and Schedule 4, para 2(3) may produce some difficult borderline cases, and some results which might appear anomalous. Perhaps they would do so on any interpretation, since in the Scotland Act Parliament was attempting to define legislative competence across the whole broad expanse of what are now regarded as the concerns of government. But (with great respect to the contrary views of Lord Rodger and Lord Kerr) I do not see this as a difficult borderline case. The relevant rule of Scots criminal law to be modified is not that driving while disqualified is a criminal offence, nor that it is a criminal offence punishable by imprisonment, nor that the maximum term of imprisonment is 12 months. All that has been enacted by the Westminster Parliament, and is left untouched. The rule to be modified is whether (and if so to what degree) the option of summary trial before the sheriff should reduce the maximum sentence that can be passed. That is to my mind a general matter relating to the Scottish system of criminal justice, and is not something special to the reserved matter of road transport. For these reasons, and for the fuller reasons in the judgment of Lord Hope, while respecting the closely argued contrary views of the minority, I agree with Lord Hope and Lord Brown that the appeals should be dismissed and the cases remitted to the Appeal Court for any further orders that may be required. LORD BROWN Section 33 of and Part 1 of Schedule 2 to the Road Traffic Offenders Act 1988 (the RTOA), as originally enacted, provided that the offence of driving while disqualified (the offence) under section 103(1)(b) of the Road Traffic Act 1988 (the RTA) could be prosecuted in Scotland either summarily or on indictment; if summarily, the maximum punishment was six months imprisonment (and/or a fine); if on indictment, twelve months (and/or a fine). The RTOA and the RTA are reserved matters. By section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (the 2007 Act) the Scottish Parliament purported to increase from six months to twelve months the maximum sentence that could be imposed for the offence by the sheriff sitting summarily. (Although immaterial to this appeal, it may be noted that in England and Wales the offence was, and remains, triable summarily only and subject to a maximum sentence of six months imprisonment.) The sole issue for determination on this devolution appeal is whether section 45 of the 2007 Act was within the Scottish Parliaments legislative competence within the meaning of section 29 of the Scotland Act 1998 (the 1998 Act). Section 29 has already been set out in full by other members of the Court and I need not repeat it. So too the relevant paragraphs of Schedule 4 to the 1998 Act (referred to in section 29(2)(c)). Before coming to the single point on which the Court is divided it is worth noting the following basic matters. First, that section 45 of the 2007 Act, the enactment impugned, did not increase the maximum penalty available for the offence in Scotland: that remained at twelve months imprisonment; what changed was that the sheriff could impose this maximum sentence no less when sitting as a court of summary jurisdiction than as a court of solemn jurisdiction. Secondly, that the essential purpose of section 45 (indeed, of sections 43 to 49 of the 2007 Act as a whole) was not to increase the penalties imposed by the Scottish courts but rather, by enlarging the sheriffs summary sentencing powers, to reallocate business within the court system to have more cases tried summarily instead of by a jury, summary trials generally being simpler, faster and cheaper than jury trials. Thirdly, that had the 2007 Act, directed as it was to reallocating court business in this way and to standardising the sheriffs summary sentencing powers for the future, not included within its provisions modification of the RTOA and the RTA in the way described, it would have created a striking contrast between the sheriffs summary powers when dealing with reserved matters and those available to him in other cases. Of course, as Lord Rodger points out, any such anomaly or inconsistency could if necessary be cured by resort to section 104 of the 1998 Act. But was that the only lawful means of achieving the desired consistency in this case? That is the question. I understand all of us to agree that section 45 does not fall foul of section 29(2)(b) of the 1998 Act. It does not relate to a reserved matter having regard to section 29(3) and is not to be deemed to relate to reserved matters by virtue of section 29(4). On this latter point, in common with Lord Hope, I regard section 45 as making modifications of Scots criminal law as it applies to reserved matters but as doing so for the purpose of making Scots criminal law (as to the allocation of court business) apply consistently. What critically divides the Court is the question raised under section 29(2)(c): as to whether section 45 is in breach of the restrictions in Schedule 4. I do not pretend to find paragraphs 2 and 3 of Schedule 4 entirely easy to follow and naturally I recognise the force of Lord Rodgers reasoning. For my part, however, I remain unpersuaded that section 45 modifies the law on reserved matters within the meaning of paragraph 2(1), given that (by virtue of paragraph 2(3)) paragraph 2(1) applies in relation to a rule of Scots criminal law only to the extent that the rule is special to a reserved matter (which I do not regard the unamended 6 months limits of the sheriffs summary jurisdiction to be). Even, however, were I persuaded that section 45 is to be regarded as modifying the law on reserved matters within the meaning of paragraph 2, I would conclude here that paragraph 2 is then disapplied by paragraph 3 since such modification is to be seen merely as incidental to a provision being made (for reallocation of court business and the standardisation of the sheriffs summary sentencing powers) in relation to unreserved matters and has no greater effect on reserved matters than is necessary to give effect to such purpose. Given that the Scottish Parliament is plainly intended to regulate the Scottish legal system I am disinclined to find a construction of Schedule 4 which would require the Scottish Parliament, when modifying that system, to invoke Westminsters help to do no more than dot the is and cross the ts of the necessary consequences. I too, therefore, would dismiss these appeals. LORD RODGER Does an enactment of the Scottish Parliament relate to reserved matters? Does it modify a rule of Scots criminal law that is special to a reserved matter? These are the key questions in the present appeals. The answers depend on the interpretation of section 29(2)(b) and (c) of the Scotland Act 1998 (the 1998 Act), along with paras 2 and 3 of Part I of Schedule 4 to the Act. Viewed in isolation, para 2, in particular, can appear to use impenetrable language to erect an arbitrary restriction on the Parliaments powers. Matters become clearer, however, when the provisions are seen in their setting in life. A useful starting point is the situation before 1999. Policy responsibility before devolution Until devolution took effect, leaving aside the fluctuating position of Northern Ireland, the central government of the United Kingdom was carried on by a single executive and a single Parliament. The executive was responsible for, and could determine, all areas of policy for the entire United Kingdom. Similarly, Parliament could legislate to give effect to the chosen policy in all parts of the United Kingdom. In practice, Parliament did not always insist on the law being uniform throughout the United Kingdom. To take only the most obvious example, Parliament did not intervene to impose uniformity on the private or criminal laws of England and Scotland. Instead, when legislation was to apply in both jurisdictions, where necessary, it included provisions that were tailored to fit the underlying law of both systems. So, for instance, the Rehabilitation of Offenders Act 1974 had to take account of differences in the two systems of criminal procedure. Sometimes, even if Parliament was legislating for England and Wales only, for example, the legislation could not be effective unless some provisions were made to extend to Scotland and vice versa. To take another obvious example, aspects of the legislation on detained patients in the Mental Health Act 1983 and the Mental Health (Scotland) Act 1984 had a cross border dimension and would have been unworkable if various provisions of the English Act had not extended to Scotland and various provisions of the Scottish Act had not extended to England. When the legislation was being prepared, officials and, if necessary, ministers in the various departments, including the Scottish Office, would discuss the proposals and try to iron out any difficulties. Even where there was no particular cross border dimension, legislation proposed by one department might have an impact on matters for which another department was responsible. Proposed legislation on, say, education might have an impact on employment; legislation on care in the community might raise law and order questions; legislation on transport might affect the environment; legislation on planning might affect trade and industry. And so on. More particularly, to be effective, legislation on a matter for which one department had responsibility might require that a piece of legislation falling within another departments sphere of responsibility should be amended. So, when a policy was being worked up and incorporated into a Bill, while one department would take the lead, very frequently officials and ministers from a number of departments would be involved. Suppose, for instance, the Home Office and the Scottish Office had proposed legislation to adjust the jurisdiction of the courts by increasing the sentencing powers of summary courts in both England and Wales and in Scotland. Suppose also that, in order to be effective, the reforming legislation would have had to modify the penalty provisions for offences in various Acts, such as the Road Traffic Offenders Act 1988 (the RTOA). In that event, officials of the lead departments would have consulted officials and ministers from all the departments, including the Department of Transport, having responsibility for the Acts which it was proposed should be modified. Sometimes the impact of the proposed legislation on a different area would be relatively insignificant perhaps involving little more than updating statutory references or bringing the language of existing legislation into conformity with the language of the proposed legislation. In such cases the main task of the other departments might well be to help the lead department and the Bill team by identifying provisions that would require to be modified in this way. But sometimes the impact would be more significant and would trench on issues of policy. Then there could well be differences of opinion among the departments concerned as to the best way forward. If officials could not resolve them, the disputed issues could be taken for decision to the appropriate cabinet committee and ultimately, if necessary, to the full cabinet or to the Prime Minister. The result would be a Bill which made all the necessary amendments, whatever the subject matter of the legislation being amended and irrespective of the department which had responsibility for that subject. Policy responsibility after devolution In the 1998 Act and the corresponding Acts for Wales and Northern Ireland, Parliament devolved legislative and executive authority in varying degrees. The powers of the Scottish Parliament are to be found in sections 28 and 29 of the 1998 Act. Section 28(1) of the 1998 Act provides that, subject to section 29, the Scottish Parliament may make laws. In terms of section 29(1), an Act of the Scottish Parliament is not law so far as any of its provisions is outside the legislative competence of the Parliament. Under section 29(2) a provision is outside that competence in various circumstances in particular, if, (b), it relates to reserved matters or, (c), it is in breach of the restrictions in Schedule 4. Leaving aside certain matters where powers are shared (section 56), it is immediately obvious that the overall scheme was to devolve power to the Scottish Executive and Scottish Parliament, but to except certain reserved matters, which are identified in Schedule 5 to the 1998 Act. All other matters are devolved matters although that term is not used since the Act concentrates on identifying the matters lying outside the competence of the Scottish Parliament and Scottish Executive. So far as these reserved matters are concerned, policy responsibility in respect of Scotland remains with the United Kingdom government and the United Kingdom Parliament retains the sole responsibility for legislating on them. The purpose of a provision and its validity It is convenient at this stage to notice that, under section 29(3) of the 1998 Act, the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter and so is outside the competence of the Parliament under section 29(2)(b) is to be determined by reference to the purpose of the provision. Sometimes the clearest indication of the purpose of a provision will be found in a report which gave rise to the legislation or in a report of one of the committees of the Parliament. But very often the purpose of a provision will be clear from its context in the Act in question. For example, the subject matter of the Carriage of Goods by Sea Act 1992 is a reserved matter: para 1 and Section E3 of Part II of Schedule 5 to the 1998 Act. Obviously, therefore, if the Scottish Parliament purported to pass a Carriage of Goods by Sea (Scotland) Act with the sole purpose of repealing the 1992 Act in Scots law, its purpose would relate to a reserved matter and so its provisions would be outside the competence of the Parliament by virtue of section 29(2)(b). In practice, such a clear example would be unlikely to get past the legal advisers to the Scottish Parliament. In real life the problem is likely to arise in more complex situations. But assume, for example, that the purpose of an Act is to increase the sentencing powers of the lower courts in Scotland so as to allow them to deal with more serious cases. The purpose of the Act plainly relates to a devolved, rather than a reserved, matter. So its provisions will not be outside the competence of the Scottish Parliament by reason of section 29(2)(b). Does it follow that all of its provisions are automatically within the competence of the Scottish Parliament? By no means. For example, any provision which was incompatible with rights under the European Convention on Human Rights or with Community law would be outside competence by reason of section 29(2)(d) even if that provision was designed to help achieve the purpose of increasing the sentencing powers of the lower courts in Scotland. Similarly, any provision which was in breach of the restrictions in Schedule 4 to the 1998 Act would be outside competence again, even though the provision was designed to help achieve the purpose of increasing the sentencing powers of the lower courts in Scotland. Quite simply, therefore, even if the purpose of an Act is within the competence of the Scottish Parliament in terms of section 29(2)(b) of the 1998 Act, the Parliament cannot achieve that purpose by enacting provisions which are beyond its competence for one of the reasons listed in the other paragraphs of that subsection. As Lord Atkin put it in Gallagher v Lynn [1937] AC 863, 870, an Act may have a perfectly lawful object but may seek to achieve that object by invalid methods. In other words, the fact that a provision may have a lawful (devolved) purpose does not validate the provision if, for some other reason, it is outside the competence of the Parliament. So, in particular, the mere fact that the purpose of a provision is to increase the sentencing powers of the sheriff, sitting as a court of summary jurisdiction, will not validate it if the provision is outside the competence of the Parliament because it purports to modify a rule of Scots criminal law that is special to a reserved matter: section 29(2)(c) of, and para 2 of Part I of Schedule 4 to, the 1998 Act. Section 104 orders The fact that the powers of the Scottish Parliament are subject to these limitations means that there is now a stark contrast between the position in England and Scotland. For England, one executive and one Parliament continue to have the necessary powers to determine policy in all subject areas and to put it into effect by legislation. For Scotland, however, the necessary powers are divided between two executives and two legislatures. Even though the legislative arrangements for Scotland have changed in this way, the nature of the problems to be tackled by legislation has not changed. So, for example, some measures, like mental health legislation, which are devolved matters, still have a cross border dimension. Similarly, proposed legislation in one field, which happens now to be devolved, may require substantial amendment to legislation in another field, which happens now to be reserved. In these situations the Scottish Parliament will not have all the powers that are needed to make a fully effective reform. So its legislation can take the matter only so far. If it is to be fully effective, the legislation passed by the Scottish Parliament will require to be topped up by legislation of the United Kingdom Parliament dealing with any aspects which are beyond its competence. The need to provide for such situations was foreseen by those who drafted the 1998 Act. Section 104, which is designed to be used when they arise, is therefore a key element of the scheme for devolution. It contains a tailor made mechanism for using the powers of the United Kingdom Parliament to supplement legislation of the Scottish Parliament, without the need for full scale legislation by Parliament: (1) Subordinate legislation may make such provision as the person making the legislation considers necessary or expedient in consequence of any provision made by or under any Act of the Scottish Parliament or made by legislation mentioned in subsection (2). (2) The legislation is subordinate legislation under an Act of Parliament made by a member of the Scottish Executive, a Scottish public authority with mixed functions or no reserved functions, or any other person (not being a Minister of the Crown) if the function of making the legislation is exercisable within devolved competence. Of course, the Scottish Parliament and Scottish Executive cannot compel a Minister of the Crown to exercise the power under section 104. The intention underlying section 104 and indeed the whole scheme of devolution is, however, that the redistribution of powers should not impair but improve the government of the United Kingdom as a whole. It proceeds on the basis that both administrations can be expected to co operate appropriately. In particular, it presupposes that the United Kingdom ministers and Parliament will not be indifferent to the effectiveness of legislation passed by the Scottish Parliament. Not surprisingly, therefore, since devolution, ministers have made more than 40 orders under section 104. Some of the section 104 orders have concerned matters with a cross border aspect. When legislating for England and Wales, Parliament can, of course, still include any provisions which require to extend to Scotland in order to make the legislation effective though, doubtless, only after discussion with the Scottish Executive and their officials. But, as already noted, it is outside the competence of the Scottish Parliament to make any provision that would form part of the law of England and Wales: section 29(1) and (2)(a) of the 1998 Act. So the Scottish Parliament cannot make any changes to English law which may be needed in order to make its legislation on the devolved matter effective. Section 104 comes to the rescue. For instance, following the enactment of the Mental Health (Care and Treatment) (Scotland) Act 2003 by the Scottish Parliament, a Scotland Office minister used his power under section 104 of the 1998 Act to make the Mental Health (Care and Treatment) (Scotland) Act 2003 (Consequential Provisions) Order 2005 (No 2078; S 9), amending the law of, inter alia, England and Wales in order to facilitate the removal of detained patients from Scotland to England or Wales. But section 104 may also be needed in cases where proposed changes in the law on one subject require changes in the law on another subject. Given the large measure of devolution in matters such as justice, education and health, many of the subjects that are likely to be affected by legislation of the Scottish Parliament will fall within the sphere of responsibility of the Scottish Executive. If the proposed amendments to existing legislation are uncontroversial, then officials can deal with them. If there are disputes on significant matters of policy between, say, the education and criminal justice directorates, it will be for the Scottish Ministers and their officials to thrash them out and incorporate the agreed policy into legislation for the consideration of the Parliament. Again, whatever the principal subject matter of an Act may be, it can be expected to include the necessary amendments to all the relevant legislation on other devolved matters. After, as before, devolution, however, legislation on a subject which is now a reserved matter is liable to have an impact on a subject which is now devolved. For example, legislation on asylum seekers (a reserved matter) might have an impact on the legislation relating to accommodation for homeless persons (a devolved matter). Given the continuing power of Parliament to legislate for Scotland (section 28(7)), there would be no difficulty in incorporating all the necessary changes into the legislation on asylum seekers presumably, after the Home Office had discussed the proposals with the Scottish Executive, just as, formerly, the Home Office would have discussed them with the Scottish Office. The converse situation is where the Scottish Executive and Parliament wish to legislate on a matter which has implications for what is now a reserved matter. If, in the days before devolution, effective legislation could often only be prepared and introduced once policy issues in a number of discrete areas had been hammered out, the position must be the same after devolution. Likewise, if different departments were the guardians of policy on different matters before devolution, the same must apply after devolution the difference being that the Scottish Ministers and their directorates are now responsible for policy on devolved matters, the United Kingdom government and its departments for policy on the other (reserved) matters. Under section 54 of the 1998 Act, the competence of Scottish ministers is, of course, modelled on the competence of the Scottish Parliament. Suppose, for instance, that the Scottish Executive wanted to introduce legislation changing the system of accommodation for homeless persons in Scotland, but the reform would involve modifying provisions in a (reserved) Act on asylum seekers. If similar legislation had been proposed by the Scottish Office before devolution, the Scottish Office and the Home Office would have discussed the relevant policy issues. Eventually, the government as a whole would have reached a view on them and this view would have been reflected in the resulting legislation if any. Obviously, after devolution, exactly the same policy issues would present themselves. By devolving power over Scottish housing policy to the Scottish Executive and the Scottish Parliament, Parliament cannot have intended to remove from the United Kingdom government the power to take all the necessary decisions on asylum matters. So, in principle, the position after devolution must remain the same as before. If the Home Office and the United Kingdom Parliament were content with the proposed changes to the legislation on asylum seekers, there would be no difficulty: they could be made by order under section 104 of the 1998 Act. One example of such an order dealing with a reserved matter is the Housing (Scotland) Act 2006 (Consequential Provisions) Order 2008 (No 1889), article 6 of which amends the list of disqualifying offices in Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975. Another example is more immediately relevant to the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (the 2007 Act) which gives rise to these appeals. The Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007 (No 3480; S 7) repeals or amends provisions of the RTOA. I return to this order briefly at para 151 below. On the other hand, if agreement could not be reached and proposed Scottish housing legislation would involve changes to legislation on asylum seekers which the United Kingdom government regarded as unacceptable, it would have to be either dropped or modified. This would not be to single out Scottish housing legislation exactly the same would apply to any similar proposal from the ministry with responsibility for housing in England. The only difference is that, for England, the dispute would have to be settled by ministers and departments within the United Kingdom government, whereas, for Scotland, it would have to be settled between a minister and department in Westminster and a minister and directorate in Edinburgh or, ultimately, between the United Kingdom government and the Scottish Executive. If, therefore, the Scottish Parliament persisted in legislating on the matter, despite the United Kingdom governments opposition, one would expect to find that the relevant provisions affecting asylum seekers would be outside its competence and so not law. By no means all encroachments by the Scottish Parliament into the territory of reserved matters are going to be dramatic or unacceptable. As already explained, legislation on a devolved matter is quite likely to entail some change in a reserved matter. Section 29(2)(c) recognises this reality. It proceeds on the basis that, even when the legislation of the Scottish Parliament does not relate to a reserved matter and so must relate to a devolved matter the legislative package, as a whole, may require to have some impact on the law on reserved matters, if it is to be effective. Section 29(2)(c) and Schedule 4 are designed to show how far, in this respect, the Scottish Parliament can go by itself. Consistently with the general structure of the Act, these provisions prescribe what modifications of the law on reserved matters lie outside the competence of the Scottish Parliament since they would truly be a matter for the consideration of the United Kingdom government and Parliament. If a proposed reform includes aspects which fall outside the competence of the Scottish Parliament in this way, that does not mean that the reform cannot go ahead: if the United Kingdom government and Parliament are content, these aspects can be addressed by an appropriate order under section 104. Incidental or consequential modifications I shall have to look at paras 2 and 3 of Part I of Schedule 4 to the 1998 Act in more detail in due course, but it is convenient to notice one aspect at this stage. As in pre devolution days, a piece of legislation on what is now a devolved matter may require essentially minor and technical modifications to the law on what are now reserved matters. Obviously, the Scottish Parliament should be able to make these modifications for itself. And para 3(1) of Part I of Schedule 4 makes it clear that it can provided that the modifications do not go further than is necessary. Referring back to the restriction imposed by para 2, para 3(1) provides: Paragraph 2 does not apply to modifications which (a) are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and (b) do not have a greater effect on reserved matters than is necessary to give effect to the purpose of the provision. The paragraph refers to modifications which are incidental to, or consequential on, provision made . which does not relate to reserved matters. The adjectives suggest the kinds of relatively minor modifications which are often to be found in schedules, rather than cluttering up the body of a traditional United Kingdom statute. The wording of a form to be used in making an application or carrying out a transaction is an example of the kind of incidental matter which is usually consigned to a schedule. As mentioned already at para 72 above, typical consequential amendments are concerned to modernise the language of an existing provision or to update legislative references. Amendments of this kind are also usually found in a schedule to an Act. Precisely because they raise no separate issue of principle, amendments of these kinds can be safely stowed away in a schedule, which is unlikely to be debated in any detail, if at all. If the legislature approves the main provisions, then it must equally approve these technical and mechanical changes which are needed to give effect to the main provisions. Similarly, it is easy to see that a modification of that kind to the law on a reserved matter, following on from legislation on a devolved matter, would be unlikely to raise any issue of principle to which the relevant United Kingdom minister or Parliament would object. So the Scottish Parliament can deal with it. That is what para 3(1) provides. In the unlikely event that a problem arose, the Secretary of State could make an order under section 35(1)(b) of the 1998 Act prohibiting the Presiding Officer from submitting the Bill for Royal Assent. With that rather lengthy introduction, I can now turn to examine the particular problem which gives rise to these appeals. The problem in these appeals Put briefly, section 45 of the 2007 Act purports to provide inter alia that a person convicted on summary complaint of a contravention of section 103(1)(b) of the Road Traffic Act 1988 (the RTA) is liable to a maximum term of imprisonment of 12 months rather than of 6 months, as originally provided in section 33 of, and Part I of Schedule 2 to, the RTOA. The effect of para 1 and Section E1 of Part II of Schedule 5 to the 1998 Act is that the RTOA is a reserved matter. So the enactment that comprises section 33 of, and Part I of Schedule 2 to, that Act is the law on a reserved matter. The appellants maintain that, to the extent that it purported to modify the maximum term of imprisonment on summary conviction laid down by the RTOA, section 45 was special to this reserved matter and so outside the competence of the Scottish Parliament by reason of section 29(2)(c) of, and para 2 of Part I of Schedule 4 to, the 1998 Act. It is therefore not law. It follows, they say, that the maximum term of imprisonment on summary conviction of a contravention of section 103(1)(b) of the RTA remains 6 months. If so, the terms of imprisonment, of over 6 months, imposed on the appellants for their respective contraventions of section 103(1)(b) of the RTA, were incompetent and the bills of suspension must be passed and the sentences quashed. The same point came before the criminal appeal court (Lord Nimmo Smith, Lord Eassie and Lord Wheatley) in Logan v Harrower 2008 SLT 1049. The court held that section 45 of the 2007 Act was within the competence of the Parliament. In the present cases the appeal court simply followed that decision and, without issuing any written judgment, refused to pass the bills of suspension. Summary jurisdiction before the 2007 Act Before looking in detail at the provisions of the 1998 Act, it is necessary to examine the position on summary jurisdiction before section 45 of the 2007 Act was brought into force on 10 December 2007. Following the enactment of the Criminal Procedure (Scotland) Act 1995 (the 1995 Act), the only provision dealing with the summary jurisdiction and powers of the sheriff to impose a sentence of imprisonment was section 5 of that Act. By section 5(1) the sheriff, sitting as a court of summary jurisdiction, was to continue to have all the jurisdiction and powers exercisable by him at the commencement of the Act. Section 5(2) then provided that, without prejudice to any other or wider powers conferred by statute, on convicting any person of a common law offence, the sheriff was to have power, (d), to impose imprisonment, for any term not exceeding 3 months. By subsection (3), in the case of a second or subsequent conviction of an offence inferring dishonest appropriation of property (or attempt) or of an offence inferring personal violence, the sheriff was to have power to impose a term of imprisonment not exceeding 6 months. Since this was the only general provision dealing with the extent of the sheriffs summary powers of imprisonment, under the 1995 Act there was no general provision of any kind in Scottish criminal procedure which prescribed the maximum term of imprisonment which a sheriff, sitting as a court of summary jurisdiction, could impose where someone was convicted of a statutory offence. The limit depended on what the legislature had provided for the particular offence. So, if you wanted, for example, to know the maximum sentence of imprisonment available on a conviction, on summary complaint, under the Knives Act 1997 you would look at sections 1(5)(a) and 2(2)(a) of that Act. Similarly, for a summary conviction of a contravention of section 103(1)(b) of the RTA, you would look in Part I of Schedule 2 to the RTOA. Often you would find that the maximum penalty on summary conviction was 3 or 6 months. But, even as long ago as 1871, section 7 of the Prevention of Crime Act permitted the sheriff to impose 12 months imprisonment on summary conviction of an offence against the Act. And, if you looked at section 25 of, and Schedule 4 to, the Misuse of Drugs Act 1971 today, you would see that the maximum sentence on summary conviction of various offences is 12 months imprisonment. In 2004 the Summary Justice Review Committee chaired by Sheriff Principal McInnes QC recommended that, in order to relieve pressure on the courts of solemn jurisdiction, the criminal jurisdiction of judges sitting summarily should be increased: they should be able to impose a maximum sentence of 12 months imprisonment or detention and a maximum fine of 20,000. The first group of sections in Part 3 of the 2007 Act (sections 43 to 49) was designed to give effect to a slightly modified version of the Committees recommendation. Sections 43 to 45 dealt with the recommendation on imprisonment for the sheriff court. Section 46 dealt with the justice of the peace court, while sections 47 and 48 were designed to increase the maximum available fine to 10,000, rather than 20,000, as contemplated by the Committee. Section 49 dealt with compensation orders. The intention behind the relevant provisions of the 2007 Act therefore was that sheriffs sitting as a court of summary jurisdiction should be able to deal with more serious contraventions of the common law and statute law not that they should impose higher sentences for the same conduct. The anticipated benefits of the reform were thought to outweigh the admitted risk that the effect of increasing the sentences which the summary courts could impose would be an undesirable upward drift in the level of sentences. The appeal court has the necessary powers to check any such tendency in an appropriate case. The reform as carried out by the 2007 Act So far as imprisonment is concerned, the reform was effected by three separate provisions. The first, section 43, dealt with the power of imprisonment for common law offences. Most common law offences, such as assault, are triable either on summary complaint or on indictment. For these cases the reform was effected simply by substituting 12 months for 3 months in section 5(2)(d) of the 1995 Act. So now the maximum penalty for all common law offences is 12 months. Section 5(3), being no longer needed, was repealed. No common law offence falls within the area of reserved matters and so no issue as to legislative competence arises. The second provision was in section 44, which deals with certain specified offences that can be tried only on summary complaint. Again, the maximum term of imprisonment is increased to 12 months. The reform was effected by amending the penalty provisions in the individual statutes creating the offences. Since none of the offences falls within the area of reserved matters, again no issue as to legislative competence arises. Section 45 completed the scheme by dealing with statutory offences which are triable either on indictment or on summary complaint (either way offences) and which are punishable on summary conviction with a maximum term of imprisonment of less than 12 months (subsection (6)). Section 45(1) and (2) provide: (1) The maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence is, by virtue of this subsection, 12 months. (2) Accordingly, the specification of a maximum period of imprisonment in every relevant penalty provision is, in relation to any relevant offence to which it applies, to be read subject to subsection (1). By section 45(2) the specification of a maximum period of imprisonment in any relevant penalty provision in any Act passed before the 2007 Act is to be read subject to section 45(1). In short, section 45 was intended to introduce a novel, general, provision for determining the maximum term which a sheriff, sitting as a court of summary jurisdiction, could impose by way of imprisonment in respect of either way statutory offences which had previously attracted a maximum sentence of less than 12 months imprisonment. In all such cases the sheriff is now to be able to impose a maximum sentence of 12 months imprisonment. In order to achieve its purpose, section 45 had to do two things. First, it had to make provision for the maximum term of imprisonment to which a person is liable on summary conviction of a relevant offence to be 12 months. That is what subsection (1) does. But, by itself, that provision would not have worked or, at the very least, would have left the position unclear. By the very terms of subsection (6)(b), section 45 applies only to offences where the statutory maximum term of imprisonment on summary complaint has already been fixed at less than 12 months. In other words, if it is to work, section 45 must also, secondly, increase the previous maximum term of imprisonment for the offences in question when tried on summary complaint. So the new rule in section 45(1) has to be made to prevail over, and to supersede, any penalty provision providing for a lower maximum term of imprisonment on summary conviction of any either way offence in any relevant enactment. That is what subsection (2) is designed to do. The present case shows subsection (2) in action. Section 33 of the RTOA provides: (1) Where a person is convicted of an offence against a provision of the Traffic Acts specified in column 1 of Part I of Schedule 2 to this Act or regulations made under any such provision, the maximum punishment by way of fine or imprisonment which may be imposed on him is that shown in column 4 against the offence and (where appropriate) the circumstances or the mode of trial there specified. (2) Any reference in column 4 of that Part to a period of years or months is to be construed as a reference to a term of imprisonment of that duration. (6) (5) (b) Summarily, in Scotland. (c) On indictment, in Scotland. (7) (4) Punishment Disqualification Endorsement Penalty points The table below sets out the entry relating to contraventions of section 103(1)(b) of the RTA in Part I of Schedule 2 to the RTOA: (3) (2) (1) Provision General Mode of creating nature of prosecution offence offence Offences under the Road Traffic Act 1988 RTA Driving (a) Summarily, (a) 6 months Discretionary. Obligatory. 6 in England and or level 5 on section while 103(1)(b) disqualified. Wales. the standard scale or both. (b) 6 months or the statutory maximum or both. (c) 12 months or a fine or both. Taking section 33 and the table together leaving the 2007 Act on one side on a summary conviction of a contravention of section 103(1)(b) of the RTA in Scotland, the maximum punishment by way of imprisonment which may be imposed on the offender is 6 months. A contravention of section 103(1)(b) of the RTA is a relevant offence in terms of section 45(6) of the 2007 Act. Similarly, section 33 of, and Part I of Schedule 2 to, the RTOA constitute a relevant penalty provision in terms of section 45(7) of the 2007 Act. So, by virtue of section 45(2), the specification of a maximum period of imprisonment of 6 months on summary conviction in column 4 of Part I of Schedule 2 is to be read subject to section 45(1) of the 2007 Act. In other words, the relevant entry in column 4 of the Schedule is to be read subject to the requirement that the maximum term of imprisonment on summary conviction of any relevant offence (including a contravention of section 103(1)(b) of the RTA) is to be 12 months. Section 45(3) of the 2007 Act gives the Scottish Ministers power by order actually to amend the specification of a maximum term of imprisonment in a relevant penalty provision. But the Court was told that the Ministers had not exercised that power in respect of Part I of Schedule 2 to the RTOA. An order amending the figure in column 4 of the Schedule from 6 to 12 would make the position clearer for anyone consulting it. But it would not change the substance. If section 45 was within the competence of the Scottish Parliament in this regard, section 45(1) prevails over the Schedule and provides that the maximum term of imprisonment for someone convicted on summary complaint of a contravention of section 103(1)(b) of the RTA is 12 months. Therefore, even if section 45 does not technically amend the figure in column 4 of the Schedule, it certainly purports to supersede, and thereby modify, the law comprising section 33 of the RTOA and the relevant entry in the Schedule. Similarly, it purports to supersede and modify all the other comparable penalty provisions which prescribe the maximum term of imprisonment that can be imposed, on summary conviction, for either way offences in statutes dealing with reserved matters. In short, section 45 purports to modify, inter alia, the maximum term of imprisonment to which someone is liable on summary conviction of a contravention of section 103(1)(b) of the RTA by increasing it from 6 months to 12 months. The issue in the appeals is whether, in so far as it purports to make this modification of the provisions of the RTOA, section 45 of the 2007 Act is outside the competence of the Scottish Parliament in any of the ways specified in section 29(2) of the 1998 Act. In fact, the parties are agreed that the only relevant limits are those in section 29(2)(b) and (c). Therefore, the Court has to decide whether section 45 of the 2007 Act falls foul of the limits in section 29(2)(b) and (c) and para 2 of Part I of Schedule 4. It is convenient to start with section 29(2)(b). Is section 45 beyond the competence of the Scottish Parliament because it relates to a reserved matter? In para 75 above, I have given a hypothetical example of an Act of the Scottish Parliament whose purpose would obviously relate to a reserved matter. The Act would therefore be outside its competence. Sometimes, of course, the purpose of a provision may be obscure. And, even when it is not obscure, people may describe the purpose in slightly different ways. But, having regard to its background and its context, I would identify the purpose of section 45 of the 2007 Act as being to adjust the jurisdiction of the Scottish courts by making 12 months the maximum term of imprisonment to which a person is liable on summary conviction of any either way statutory offence. For the sake of brevity, I shall refer to this purpose as being to increase the sheriffs summary sentencing powers. The jurisdiction and sentencing powers of the Scottish courts are not reserved matters. So the purpose of the section can on no view be said to relate to reserved matters. This is so, even though, in order to achieve its purpose, as part of the scheme for adjusting the jurisdiction of the Scottish courts, the section does undoubtedly purport to affect reserved matters, viz, by modifying the relevant penalty provision in the RTOA and, as the advocate depute accepted, by modifying penalty provisions for either way offences in any other statutes falling within the scope of the reserved matters in Schedule 5 to the 1998 Act. An example would be the maximum term of imprisonment on summary conviction of a corrupt practice under section 168(1)(b) of the Representation of the People Act 1983. Section 29(4) of the 1998 Act has also to be considered, however, since it contemplates the possibility that a provision whose purpose does not otherwise relate to a reserved matter may nevertheless be treated as relating to a reserved matter and so fall outside the competence of the Scottish Parliament. Subsection (4) applies to a provision which makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters. So the subsection would apply only if section 45 could be said to make a modification to Scots criminal law as it applies to reserved matters. The advocate depute argued that subsection (4) did not apply to a case like the present because it was restricted to cases where the provision in question applied only to reserved matters. Although no such qualification appears in the wording, he submitted that it was implicit since, if a provision applied to both reserved and devolved matters, its purpose would, inevitably, be to make the law apply consistently to reserved matters and otherwise. I accept that, where a provision applies to both reserved and devolved matters, its effect may be to make the law apply consistently to both. But its purpose may be different. It is possible, for example, to conceive of a situation where the purpose of a provision was actually to make a modification in relation to the criminal law applying to a particular reserved matter, but the provision was made to apply, incidentally, to devolved matters. Section 29(4) must be apt to catch a case of that kind. That said, I am very doubtful whether subsection (4) applies in this case. The words of the subsection obviously cover a case where some general provision of Scots private or criminal law applies to reserved matters. For example, it would cover modifications to the general law on limitation as it applied to actions relating to some reserved matter; or modifications to, say, the general law of criminal procedure as it applied to an accuseds trial, on summary complaint or on indictment, for some offence constituting a reserved matter. In such cases the provision modifies the law applying to the reserved matter; it does not modify the reserved matter itself. But Parliament provides that, subject to the unless clause, it is none the less to be treated as relating to the reserved matter. In the present case, by contrast, section 45 actually modifies the reserved matter or, rather, the law on the reserved matter viz, the penal provision in Part I of Schedule 2 to the RTOA. In my view section 29(4) is not designed to cover a provision of this kind. Therefore, as far as section 29(2)(b) is concerned, the position is regulated by section 29(3). Even if this were considered to be too narrow a construction of section 29(4) of the 1998 Act, section 45 of the 2007 Act would still not fall to be treated as relating to the reserved matter of the RTOA. A provision which makes modifications of Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law apply consistently to reserved matters and otherwise. The phrase, the purpose of the provision, must refer to the same purpose in both subsection (3) and subsection (4). Part of the purpose of section 45 as described in para 112 above is indeed to make the law on the sheriffs power to imprison apply consistently to all either way statutory offences, whether constituting reserved matters in terms of Schedule 5 or not. So section 45 is not to be treated as relating to a reserved matter under section 29(4). In effect, the unless clause in section 29(4) allows the Scottish Parliament to make a general reform of Scottish private or criminal law, even though it modifies the law which applies to reserved matters. Again, this is not surprising since the United Kingdom Parliaments legislation on particular topics has always been framed and operated against the background of the general private and criminal law as it applies in the various jurisdictions from time to time. Equally, any reform of the general law has to take account of all the matters to which it actually applies. In agreement with all of your Lordships, I am therefore satisfied that section 45 of the 2007 Act is not outside the competence of the Scottish Parliament by reason of relating to a reserved matter. The question then arises: even though the purpose of section 45 is one that the Scottish Parliament can legitimately pursue, is the section nevertheless to some extent outside its competence because it is in breach of a restriction in para 2 of Part I of Schedule 4 to the 1998 Act? This question has to be addressed in stages. Does section 45 modify the law on a reserved matter? As already explained, under section 29(2)(c) of the 1998 Act, section 45 will be outside the competence of the Scottish Parliament so far as it breaches any of the restrictions in Schedule 4 to the 1998 Act. The relevant paragraphs for present purposes are paras 2 and 3. Paragraph 2 provides: (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent that the rule in question is special to a reserved matter or the subject matter of the rule is (a) interest on sums due in respect of taxes or excise duties and refunds of such taxes or duties, or (b) the obligations, in relation to occupational or personal pension schemes, of the trustees or managers. At first sight, para 2(1) appears to impose a very drastic limit on the competence of the Scottish Parliament: an Act of the Parliament cannot modify (which includes amending or repealing section 126(1)) the law on reserved matters. If that were all that para 2 said, then it would prevent the Scottish Parliament from ever touching legislation on reserved matters even if the purpose of the provision related to a devolved matter. In effect, it would make section 29(2)(b) superfluous. But para 2(1) is actually qualified by para 2(3) and does not apply to modifications falling within the scope of para 3. Section 29(3) and (4) focus on the provision which is being enacted and on its purpose. By contrast, para 2 of Part I of Schedule 4 focuses on the rule of law that is being modified by the enactment and makes no mention whatever of the purpose of the modification. Paragraph 2(2)(a) defines the law on reserved matters as any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament. As explained in para 95 above, the effect of para 1 and Section E1 of Part II of Schedule 5 to the 1998 Act is that the subject matter of the RTOA is a reserved matter. So the enactment comprising section 33 of, and the relevant entry in Part I of Schedule 2 to, that Act is part of the law on this reserved matter. This conclusion supports my earlier conclusion that these provisions are not provisions of Scots criminal law, as it applies to reserved matters in terms of section 29(4)(b). A provision cannot be both the law on a reserved matter and the law as it applies to the self same reserved matter. As I have already explained at para 110 above, section 45 of the 2007 Act undoubtedly purports to supersede and modify the enactment in section 33 of, and the relevant entry in Part I of Schedule 2 to, the RTOA. Therefore the power of the Scottish Parliament to enact section 45 for reserved statutes depends on whether the restriction in para 2(1) of Part I of Schedule 4 to the 1998 Act applies to the modification made by section 45. Does section 45 fall within para 3(1) of Part I of Schedule 4? In Logan v Harrower 2008 SLT 1049, 1054, at para 24, giving the opinion of the appeal court, Lord Nimmo Smith said this: While we were not fully addressed on the extent to which recourse may legitimately be had to extra statutory materials as an aid to the construction of a statutory provision such as section 45, in order to discover whether its purpose is such as to bring it within the proviso to section 29(4), it appears to us to be legitimate to have regard to the passages in the Policy Memorandum and Explanatory Notes, quoted above, which contain express statements about its purpose. From these it may be taken, as the advocate depute submitted, that the purpose and of the provision in section 45 of the 2007 Act is to increase generally the criminal sentencing powers of the sheriff, sitting as a court of summary jurisdiction, and that the provision, construed in this light, fulfils this purpose. We agree with the advocate depute that, in the present case, the purpose of the provision is to make Scots criminal law with regard to penalties, procedure and jurisdiction in the sheriff court apply consistently to both common law offences and statutory offences. As provided by paragraph 3 in Part I of Schedule 4 to the Scotland Act, the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to RTOA 1988 are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin; and the modifications do not have a greater effect upon reserved matters than is necessary to give effect to the purpose of the provision in section 45. Lord Nimmo Smith had already explained, at para 22 of the courts opinion, that the argument before the court had centred on section 29(4) of the 1998 Act. And para 23 and the first three sentences of para 24 contain the reasoning by which the court concluded that section 45 of the 2007 Act was not to be treated as relating to reserved matters by reason of section 29(4). In the final sentence of para 24 the appeal court moved on to consider whether, nevertheless, section 45 was in breach of the restriction in para 2(1) of Part I of Schedule 4 to the 1998 Act. The court held that it was not on the view that the modifications made by section 45 of the 2007 Act to the reading of Part I of Schedule 2 to the RTOA are merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin. The appeal court had in mind para 3(1) of Part I of Schedule 4 which is set out in para 91 above. In other words, the court held that the modifications made by section 45 were incidental to, or consequential on, provision made which did not relate to reserved matters. So the prohibition in para 2(1) did not apply to those modifications. In my view the reasoning is unsound. I have already indicated, at paras 91 93 above, that para 3(1) appears to be intended to cover the kinds of minor modifications which are obviously necessary to give effect to a piece of devolved legislation, but which raise no separate issue of principle. Indeed the amendments to the RTOA replacing references to the district court with references to the justice of the peace court in para 7 of the Schedule to the 2007 Act are as good an example as any of minor consequential amendments to the law on reserved matters which para 3(1) of Part I of Schedule 4 to the 1998 Act permits the Scottish Parliament to make. In fact, para 444 of the Explanatory Notes says that Paragraph 7 is consequential upon the establishment of JP courts and inserts references to that court in place of the district court. But the modifications made by section 45 of the 2007 Act are of a completely different character and the draftsman clearly thought so, since they are effected not in the Schedule but by a separate section in the body of the Act. Section 45 is one of three sections (the others being 43 and 44) which combine to alter the jurisdiction of the sheriff sitting as a court of summary jurisdiction. None of the sections can be regarded as incidental to, or consequential on, another: they are all independent and deal with distinct aspects of the situation. Needless to say, the relevant paragraphs of the Explanatory Notes do not suggest that section 45 is to be regarded as merely consequential or incidental. Moreover, section 45 applies to any penalty provision in a relevant enactment which, by subsection (7), covers any Act passed before the 2007 Act. These are the words which bring in, for example, the RTOA. So the modifications of the law on reserved matters made by section 45 are effected by exactly the same words as the modifications of the law on devolved matters. Both sets of modifications play an equivalent part in the overall scheme the modifications to reserved penalty provisions are of no less importance than the modifications to devolved penalty provisions. Neither can be regarded as incidental to, or consequential on, the other. Despite this, in Logan v Harrower the appeal court considered that the modifications to the law in Part I of Schedule 2 to the RTOA were merely incidental to, or consequential on, the more general aspect of the provision, which relates generally to the powers of the sheriff in relation to statutory offences, whatever their origin. The reasoning is not easy to follow. It is enough, however, to observe that neither section 45 nor any other provision in the 2007 Act actually has any separate more general aspect relating generally to the powers of the sheriff in relation to statutory offences. So there is no separate devolved provision of that kind and, more particularly, no separate provision made which does not relate to reserved matters in relation to which the modifications to the RTOA made by section 45 could ever be regarded as incidental or consequential. For these reasons, like Lord Hope, I am satisfied that para 3(1) of Part I of Schedule 4 to the 1998 Act does not have the effect of preventing para 2 from applying to section 45 of the 2007 Act. It is therefore necessary to look at the qualification to para 2(1) which is to be found in para 2(3), and which the appeal court did not consider in Logan v Harrower because of their conclusion on para 3(1). Is the rule of law in the RTOA special to a reserved matter under para 2(3)? Unquestionably, section 33 of the RTOA and the relevant entry in Part I of Schedule 2 comprise a rule of Scots criminal law to the effect that, on a summary conviction of a contravention of section 103(1)(b) of the RTA, the maximum punishment by way of imprisonment which may be imposed on the offender is 6 months. That is the rule which section 45 purports to modify. Paragraph 2(1) of Part I of Schedule 4 prevents the Scottish Parliament from modifying a rule of Scots criminal law only to the extent that the rule is special to a reserved matter. So the Court has to decide whether this rule is special to a reserved matter. The advocate depute argued that the rule is not special to this reserved matter or indeed to any other reserved matter: the rule simply prescribes a maximum penalty of 6 months imprisonment for a conviction on summary complaint and that is a penalty that is found in many statutes, on both reserved and devolved matters. To be special, the penalty would have to be one that was not prescribed for an infringement of any statute dealing with a devolved matter. In theory, for instance, it would have applied if the unique penalty for an infringement of section 103(1)(b) of the RTA had been per impossibile say, whipping. Then, because that was a penalty which was found only within the sphere of reserved matters, the Scottish Parliament would be prevented from modifying it. It is fair, however, to say that the advocate depute was unable to point to any actual rule of Scottish criminal law or procedure to which, on his preferred construction, para 2(1) would apply. Although I was initially attracted by the advocate deputes argument, it cannot be right, since, on his construction, the limit makes no sense whatever. Why should the Scottish Parliaments power to modify an enactment whose subject matter is a reserved matter depend on whether there happens to be some comparable enactment dealing with a completely different devolved matter? More particularly, why should the Scottish Parliament be entitled to modify the maximum term of 6 months imprisonment on summary conviction of a contravention of section 103(1)(b) of the RTA in Part I of Schedule 2 to the RTOA simply because there happen to be a number of either way offences in the devolved area where the maximum term of imprisonment on summary conviction is also 6 months? Of course, the Parliament can alter the penalty provision for those offences because it is its business to make such amendments where appropriate. But that is, of itself, no reason why it should become the Scottish Parliaments business for whatever purpose to modify the penalty provision which Parliament has deliberately chosen to enact for a specific offence for which Parliament retains responsibility. The general point can be illustrated by reference to limitation periods. As Mr Johnston QC points out, in Prescription and Limitation (1999), Appendix II, p 371, the Prescription and Limitation (Scotland) Act 1973 (the 1973 Act) does not say that its provisions are not to apply where other enactments establish a prescriptive or limitation period for specific rights or remedies. Nevertheless, as he goes on to say, on general principles of statutory construction, it can be assumed that an enactment of a special nature takes precedence over an enactment of a general nature: the 1973 Act is therefore displaced by more specific provision in other enactments. Mr Johnston then gives a useful table listing a range of enactments which contain their own specific limitation periods. By contrast, there are many statutes which provide for civil liability but do not contain any separate, specific, provision on limitation of proceedings brought for their breach. For example, a breach of a duty under the Provision and Use of Work Equipment Regulations 1998 (No 2306) is actionable: section 42 of the Health and Safety Act 1974. But there is no special rule of law on the limitation of proceedings for such a breach: the general rule of law in the 1973 Act applies. Therefore, if the Scottish Parliament chose to alter that general rule in the 1973 Act, it could do so and the new period would apply to actions for breach of the Regulations. This is so, even though Part I of the Health and Safety Act is a reserved matter: para 1 and Section H2 of Part II of Schedule 5 to the 1998 Act. Many statutes do make special provision on limitation, however. For example, under section 568(5) of the Companies Act 2006, an action for loss suffered because of a contravention of the pre emption provision in a companys articles must be brought within 2 years. That is unquestionably the law on a reserved matter as defined in para 2(2) of Part I of Schedule 4 to the 1998 Act. It is surely unthinkable that, even as part of an exercise to tidy up the Scots law of limitation of actions, the Scottish Parliament would be able to alter that period, which is special in the sense that, instead of relying on the general law of limitation, Parliament has deliberately selected 2 years as being appropriate for proceedings of that particular kind. Leaving aside any other possible difficulties, if the Scottish Parliament could change the period, the result would be to introduce a difference between English and Scots law in an area where Parliament, legislating after devolution, must have considered that the same special rule should continue to apply in both jurisdictions. Equally surely, the power of the Scottish Parliament to alter the period in section 568(5) of the Companies Act could not be affected because, if you rooted around in the statute book, you could find that, under section 5 of the Limitations of Actions and Costs Act 1842, the limitation period for actions brought under local and personal Acts (which would, usually at least, concern devolved matters) happened also to be 2 years. Likewise, it would be irrational to conclude that, if the Scottish Parliament were to repeal or amend section 5 of the 1842 Act so that it no longer provided for a period of 2 years, this would somehow simultaneously remove a power which the Parliament had hitherto enjoyed to amend the limitation period under section 568(5) of the Companies Act 2006. Quite simply, the two enactments have nothing to do with one another. Conversely and reverting to penalties it would be absurd to hold that the Scottish Parliament could not modify a penalty provision so long as it was special to, in the sense of unique to, a reserved matter, but could give itself the power to do so by enacting the same penalty for a devolved matter. Besides being absurd, this would offend against the principle that the limits on the competence of the Scottish Parliament are fixed by the 1998 Act and cannot be altered except by new legislation by Parliament or by Order in Council under section 30(2). What, then, do the critical words mean? In my view, a statutory rule of law is special to a reserved matter if it has been specially, specifically, enacted to apply to the reserved matter in question as opposed to being a general rule of Scots private or criminal law which applies to, inter alia, a reserved matter. Only general rules whose subject matter is listed in sub paras (a) to (e) of para 2(3), as amended, are protected from modification. If interpreted in this way, para 2(3) means that para 2(1) prevents the Scottish Parliament from modifying any enactment which must be taken to reflect the conscious choice of Parliament to make special provision for the particular circumstances, rather than to rely on some general provision of Scottish private or criminal law. Whether or not to modify such an enactment involves questions of policy which must be left for the consideration of the United Kingdom government and Parliament which are responsible for the matter. On this interpretation, paras 2(1) and (3) place a comprehensible limit on what the Scottish Parliament can do. I return to the particular problem in these appeals. Suppose that, instead of increasing the maximum term of imprisonment available on summary conviction of a contravention of section 103(1)(b) of the RTA from 6 to 12 months, the Scottish Parliament had chosen to reduce it to 3 months perhaps as part of a general package of reductions in sentences designed to save money by cutting expenditure on criminal justice. The purpose of the legislation would plainly relate to a devolved matter. Nevertheless, the Scottish Parliament could not achieve that purpose by modifying the RTOA in that way because the maximum term of imprisonment on summary conviction of the offence had been specially chosen by Parliament. The modification would therefore be outside the competence of the Scottish Parliament by virtue of para 2 of Part I of Schedule 4. And it would rightly be outside competence because it would inevitably involve significant road traffic policy issues which, under the 1998 Act, it would be for the United Kingdom government (more particularly, the Secretary of State for Transport) and Parliament to evaluate. For instance, would it be acceptable if the average sentence for driving while disqualified fell because prosecutors were reluctant to mount the more complicated and time consuming sheriff and jury trials necessary to attract a prison sentence of more than 3 months? Would the potential cost cutting advantages of the policy outweigh this possible disadvantage? Mutatis mutandis, the Secretary of State for Transport and the United Kingdom government as a whole would have to consider these issues if the Ministry of Justice made an equivalent proposal for England and Wales. If they ultimately agreed, Parliament would be asked to legislate to amend the RTOA. In the case of Scotland, if the United Kingdom government and Parliament were content, the necessary changes could be made by a section 104 order. If a reduction in the maximum term of imprisonment on summary conviction would be outside the competence of the Scottish Parliament in this way, the same must apply to an increase. For these reasons I conclude that the rule of Scots criminal law prescribing the maximum term of imprisonment for a summary conviction of a contravention of section 103(1)(b) of the RTA, in Part I of Schedule 2 to the RTOA, is special to that reserved matter, in the sense that Parliament has chosen it specifically for that offence. So, by virtue of para 2(1) of Part I of Schedule 4 to the 1998 Act, the Scottish Parliament has no power to modify it. A majority of your Lordships have reached the opposite view. At para 34 of his judgment, Lord Hope accepts that, when considering para 2 of Part I of Schedule 4, the starting point is identifying the rule of Scots criminal law that is being modified. Then one must ask whether that rule is special to a reserved matter. Naturally, I agree. Lord Hope takes the view that the purpose of the enactment may be referred to in order to identify the rule of law that is being modified. I see no room for that approach in this case. Here, the purpose of the enactment is clear and undisputed: to increase the sheriffs summary sentencing powers. If, however, you want to know which rules of Scottish criminal law the enactment is modifying in order to achieve that purpose, you simply have to look at the perfectly clear terms of section 45 and apply them to the penal provisions in question. I agree with Lord Hope when he says, at paras 35 and 37, that the rule of Scots law as to the maximum term of imprisonment that can be imposed i e the maximum period of 12 months on indictment, set out in the relevant part of column 4 of the Schedule falls to be treated as a rule that is special to a reserved matter. I have explained my reasons for taking that view. These cannot, of course, be Lord Hopes reasons. But he gives no explanation for his view beyond the assertion that it plainly, is a rule which is special to the Road Traffic Acts and it is a reserved matter. In para 39 Lord Hope considers that it would be to carry the process of analysis too far to say that the Schedule contains two maximum sentences, one for summary proceedings and the other for proceedings on indictment. But that is precisely what Parliament does say in section 33(1) of the RTOA read together with the relevant entry in the Schedule (referring to the maximum punishment by way of imprisonment and giving different figures depending on the mode of trial). Lord Hope also thinks that it would be carrying the process of analysis too far to say that both of these maximum sentences are special. Apparently this is because such a decision depends on an exercise of judgment in which the purpose of the provision (here, section 45) may be the best guide. But, as the cross headings show, para 2 of Part I of Schedule 4 is designed to protect the law on reserved matters from modification. It is therefore necessary to identify which rules of Scots criminal law are to be regarded as special to a reserved matter in terms of para 2(3) and so protected from modification. Since, ex hypothesi, these rules cannot be modified, they cannot be identified by reference to the purpose of a provision which purports to modify them. In the end, therefore, all we know is that, for some unstated reason, the maximum sentence which can be imposed on conviction of a contravention of section 103(1)(b) of the RTA in a prosecution on indictment is a rule which is special to the Road Traffic Acts, but the maximum sentence which can be imposed for the same offence in a summary prosecution is not. In para 59 of his judgment Lord Walker identifies what the relevant rule of Scots criminal law to be modified is not: it is not that driving while disqualified is a criminal offence (agreed), nor that it is a criminal offence punishable by imprisonment (agreed), nor that the maximum term of imprisonment is 12 months (also agreed, since, again, this must be a reference to the maximum term of imprisonment in a prosecution on indictment). The inference seems to be that these rules might indeed be special to a reserved matter and beyond the reach of the Scottish Parliament. As Lord Walker says, however, all these rules have been left untouched. You then eagerly wait to hear about the rule that has not been left untouched: that the maximum term of imprisonment is 6 months in a summary prosecution. But you wait in vain. Instead, the rule to be modified turns out to be whether (and if so to what degree) the option of summary trial before the sheriff should reduce the maximum sentence that can be passed. With great respect, that does not really look much like a rule of Scots criminal law. But, whatever the description, it is actually the product of the two specific rules of Scots criminal law as to the maximum term of imprisonment for a contravention of section 103(1)(b) of the RTA in summary and indictment proceedings respectively. That product can itself be modified only by modifying either or both of these specific rules. By enacting section 45, the Scottish Parliament purported to modify the rule that the maximum term of imprisonment for this offence in summary proceedings is 6 months. The unavoidable question is whether that rule is special to a reserved matter in terms of para 2(3) of Part I of Schedule 4 to the 1998 Act. But that question is neither posed nor answered. Having bowed politely in the general direction of the argument, Lord Brown rests his conclusion on simple assertion. Until now, judges, lawyers and law students have had to try to work out what Parliament meant by a rule of Scots criminal law that is special to a reserved matter. That is, on any view, a difficult enough problem. Now, however, they must also try to work out what the Supreme Court means by these words. It is a new and intriguing mystery. Conclusion In my view, so far as it relates to the penalty provision in the RTOA relating to contraventions of section 103(1)(b) of the RTA, section 45 was outside the competence of the Scottish Parliament. There was, of course, nothing to prevent the Scottish Parliament from increasing the maximum term of imprisonment which a sheriff, sitting as a court of summary jurisdiction, could impose. That is what section 45(1) does and, by itself, the provision is unobjectionable since it merely deals with the jurisdiction of the sheriff. But any increase in jurisdiction brought about by section 45(1) would remain subject to all the penalty provisions in statutes which stipulate a lower maximum term of imprisonment on summary conviction. So subsection (2) was introduced in order to modify all those provisions. Modification of penal provisions in statutes falling within the devolved sphere causes no difficulty. But, for the reasons I have explained, modifying a specific penal provision in a statute within the reserved area is outside competence essentially, because it involves making a significant change to law which Parliament has decided is to be its own responsibility. Of course, it is true that the purpose of section 45 is to increase the sheriffs summary sentencing powers. That is why section 45 does not relate to reserved matters and so is not beyond the competence of the Scottish Parliament by virtue of section 29(2)(b). But a purpose of increasing the summary sentencing powers of sheriffs or other lower court judges is not a passport that entitles the Scottish Parliament to disregard the prohibitions in the other paragraphs of section 29(2) and to sweep aside any provision of the RTOA which stands in its way. The competent end does not justify the use of means which are beyond competence. If evidence to support that simple proposition were needed, it is to be found in the Criminal Proceedings etc (Reform) (Scotland) Act 2007 (Powers of District and JP Courts) Order 2007, which was made under section 104 of the 1998 Act shortly before the 2007 Act came into force. The order was not mentioned by counsel on either side. Its purpose was, first, to repeal the provisions of the RTOA which prevented the district court (and its successor, the justice of the peace court) from imposing the penalty of disqualification for traffic offences, and then to amend section 34 so as to include the district court (and, hence, the justice of the peace court) among the courts with the power to impose that penalty for such offences. Even though these changes were clearly part of the overall scheme in the 2007 Act, to allow the lower courts to hear more serious cases by increasing their sentencing powers, it was recognised that the section 104 order was needed to carry out this particular aspect of the scheme. By contrast, the minor consequential amendment to section 248C(1) of the 1995 Act, relating to the disqualification power for other offences, was made by section 80 of, and para 26 of the Schedule to, the 2007 Act. In order to achieve another part of the scheme to adjust the jurisdiction of the Scottish courts by increasing the sentencing powers of the lower courts, section 45 of the 2007 Act purports to modify, inter alia, the enactment relating to contraventions of section 103(1)(b) of the RTA in Part I of Schedule 2 to the (reserved) RTOA. As a result, the maximum term of imprisonment that can be imposed for that offence by a court of summary jurisdiction in Scotland is intended to be twice what can be imposed by the equivalent court in England. Of course, it is not essential that the two jurisdictions should march exactly in step on this matter as is plain from the availability of indictment proceedings with a maximum sentence of 12 months imprisonment in Scotland, but not in England. But that is a disparity which Parliament chose to introduce. Whether a further disparity between the jurisdictions should indeed be introduced is precisely the kind of issue like the issue as to whether the district court or justice of the peace court, rather than just the sheriff court, should have power to disqualify for road traffic offences which the 1998 Act intends that Parliament should decide. This need cause no difficulty for the Scottish Executives scheme to adjust the jurisdiction of the Scottish courts by increasing the sentencing powers of sheriffs in summary cases if the United Kingdom government and Parliament are content that the maximum available term of imprisonment for this offence on summary conviction should be increased in this way. Provided the draft is approved by both Houses of Parliament, the appropriate order can be made under section 104 of the 1998 Act: sections 114 and 115 and paras 2 and 3 of Schedule 7. This is indeed precisely the kind of situation for which section 104 was designed. Applying section 101 of the 1998 Act, I would therefore hold that the definition of relevant penalty provision in section 45(7) of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 does not include a provision of a relevant enactment or instrument which is special to a reserved matter within the meaning of para 2(3) of Part I of Schedule 4 to the Scotland Act 1998. It follows that section 45 does not modify the maximum term of imprisonment of 6 months on summary conviction of a contravention of section 103(1)(b) of the Road Traffic Act 1988 in column 4 of Part I of Schedule 2 to the Road Traffic Offenders Act 1988. I would accordingly allow the appeals, pass the bills of suspension, quash the sentence imposed by the sheriff court in each case for the contravention of section 103(1)(b) of the Road Traffic Act 1988 and remit to the appeal court to proceed as accords. LORD KERR The legislative competence of the Scottish Parliament is self evidently a subject of fundamental importance. As the appeals in these cases amply demonstrate, however, it is impossible to devise a comprehensive charter which, for every conceivable situation, infallibly prescribes the limits of that legislatures enacting power. This, it seems to me, is the inevitable consequence of the transfer by the United Kingdom government of some or even many powers to a devolved administration while retaining or, as it is more usually put, reserving, certain other matters to Parliament in Westminster. Whether a particular Act of the Scottish Parliament falls within its legislative competence will, for the most part therefore, depend on a consideration of the particular provisions of the enactment in question. The quest will usually begin with section 29 of the Scotland Act 1998. It stipulates (in subsection (1)) that any provision of an Act of the Scottish Parliament is not law so far as it is outside the legislative competence of the Parliament. Subsection (2) (b) states that a provision is outside the competence of the Scottish Parliament if it relates to reserved matters. The issue as to whether a provision does so relate is to be determined in accordance with subsection (3) which, so far as is material, provides: the question whether a provision of an Act of the Scottish Parliament relates to a reserved matter is to be determined, subject to subsection (4), by reference to the purpose of the provision, having regard (among other things) to its effect in all the circumstances. Subsection (3) has a number of component parts, each of which deserves careful consideration. The first is that which specifies that it is subject to subsection (4). This latter subsection (to which I shall turn presently) is a deeming provision designed to expand the category of cases in which a change in the law is to be considered to relate to reserved matters because it modifies Scots private or criminal law as it applies to reserved matters. The need to enlarge the group in this way appears to me to clearly indicate that the construction to be placed on the expression relates to reserved matters must be suitably restrained. If, in every instance where a provision of the Scottish Parliament touched on a reserved matter, it was to be considered to relate to a reserved matter, subsection (4) would not be needed. The phrase needs a more careful and restricted application, therefore. Guidance as to the extent of the restriction is provided by the next component part of section 29 (3). The resolution of the question whether a particular provision relates to a reserved matter is to be determined by reference to the purpose of the provision. One is immediately thereby drawn to an examination of the objective of the legislation and of the particular provision within it. Before dealing with the result of that examination, it is useful to note the next component part of subsection (3). It is to the effect that the determination (by reference to its purpose) whether an Act of the Scottish Parliament relates to a reserved matter is to be conducted having regard to (among other things) its effect in all the circumstances. It seems to me obvious that the way in which the subsection is structured signifies that the effect of the provision is subordinate to its purpose in the inquiry as to whether it relates to a reserved matter. Indeed, the assessment of the effect of the provision is directly linked to the search for its purpose. This is unsurprising. As Lord Brown pointed out in the course of argument, one will customarily expect that the purpose of a particular provision is to bring about a desired effect. The other things, apart from the effect of the provision, which are to be taken into account in ascertaining its purpose are not specified in subsection (3). Mr Brown on behalf of the appellant, Mr Miller, accepted (sensibly and correctly, in my view) that these would include statements by those responsible for the legislation which purported to identify the reasons for its enactment. The genesis of the legislation under challenge here is the report of the Committee appointed in November 2001 to review summary justice in Scotland under the chairmanship of Sheriff Principal John McInnes QC. The formal remit of the Committee was stated to be: To review the provision of summary justice in Scotland, including the structures and procedures of the sheriff courts and district courts as they relate to summary business and the inter relation between the two levels of court, and to make recommendations for the more efficient and effective delivery of summary justice in Scotland. In paragraph 9 of its summary of recommendations the Committee recorded its proposal that the criminal jurisdiction for judges in summary cases should be a maximum 12 months detention or imprisonment and a 20,000 fine. The reasons for this particular recommendation are discussed throughout the report. In paragraph 7.72 on page 78 at paragraph (iv) it is explained that the view of the majority of the Committee was that there was a need to relieve pressure on the higher courts. This required the lower courts to take on more serious cases. Consequently, some increase in sentencing powers for the judges in those courts was required. The Committee recognised that recommending an increase in the sentencing powers of the courts of summary jurisdiction could give rise to what is described in the report as sentence drift, that is a tendency to increase the normal sentencing range because of the availability of the increase in the statutory maxima. It made clear its express disavowal of any intention to bring about sentence drift in paragraph 7.89 of the report where the following appears: In proposing an increase in sentencing powers, we are clear that we do not intend any uplift of the going rate for all offences, but rather we wish to extend the range of offences that can appropriately be dealt with in the summary courts. The Ministerial response to the McInnes recommendations was contained in a report entitled, Smarter Justice, Safer Communities Summary Justice Reform published in March 2005. In paragraph 4.10 the Scottish Executive signalled its acceptance of the proposal that there be an increase in the sentencing powers of a sheriff sitting without a jury in summary proceedings, stating that this form of proceeding was generally simpler and faster than trials in a solemn court. The report also acknowledged the concern that there might be upward sentence drift but recorded the Committees finding that there was no evidence that this was linked to an increase of sentencing powers in summary proceedings (para 4.51). The Bill which was to give effect to the recommendations of the McInnes Committee (among other matters), the Criminal Proceedings etc. (Reform) (Scotland) Bill, was introduced to the Scottish Parliament on 27 February 2006. Clause 35, which became section 45 of the enacted legislation, dealt with certain statutory offences (including driving whilst disqualified) and provided for a new maximum term of imprisonment of twelve months to which a person summarily convicted of such an offence would be liable. The Bill was considered by the Justice 1 Committee of the Scottish Parliament on 19 April 2006. In answer to a question from a member of the Justice Committee concerning the possibility of an increase in the prison population because of the enlarged sentencing powers of the sheriff courts in summary proceedings, Noel Rehfisch of the Scottish Executive Justice Department said this, at Scottish Parliament Official Report, cols 2838 2839: it is clear that the intention of the changes is not to be more punitive in respect of any particular offence. For example, for any statutory offence that can be tried only summarily at present, the sentencing limit will not change. The increase to 12 months is about providing headroom in the summary system to deal with slightly more serious cases that, in the view of the McInnes Committee which ministers accepted could relevantly, competently and capably be dealt with in the sheriff summary court. On two occasions in recent years there have been increases in the maximum sentencing level in the sheriff solemn courts. The same sheriffs, albeit with a jury, are responsible for determining sentences in those cases. To date, there is no evidence that those increases have led to what might popularly be described as sentence drift. We are confident that the judiciary will continue to consider individual cases on their merits. The measures are about having the appropriate level of business in certain sectors of the system. These comments were reflected in the 10th report of the Justice 1 Committee published on 5 July 2006. At paragraph 135 of the report the following appears: In oral evidence Executive officials stated that these provisions are about seeking some form of business redistribution to ensure that every level of the system deals with the business that it ought to deal with and managing that as effectively as possible. Indeed, in the Policy Memorandum [containing the Executives comments on the provisions of the Bill], the Executive refers to its policy of creating a flexible court capacity to ensure that cases can be dealt with quickly and at the appropriate level. and at paragraph 136: The Executives expectation is that this redistribution of cases would represent a downward shift of around 500 to 550 cases per year from sheriff and jury to sheriff summary procedure. The Executive has also stated that the provisions in the Bill are not designed to be more punitive in relation to any particular offences. The Scottish Prison Service referred in oral evidence to its view that it does not expect the Bill to have a significant impact on the prison population. It appears to me from all this material that the purpose of section 45 of the 2007 Act is unmistakably clear. As the advocate depute submitted, it is to effect a reallocation of business within the court structure. The means by which this is achieved is an increase in the sentencing powers available to sheriffs sitting in their summary jurisdiction. The greater maximum penalty is not an end in itself nor is it intended that that the going rate for relevant offences should be increased. This is merely the mechanism by which the quite different purpose of providing for a more expeditious dispatch of business can be achieved. This conclusion is reinforced by the consideration that defendants charged with relevant offences are not exposed to a greater penalty in the summary proceedings than they formerly faced if prosecuted for the same offences on indictment. In this context, I should say that I consider that the analogy which the appellants sought to draw with the decision of the Divisional Court in Northern Ireland in the case of Reg (Hume) v Londonderry Justices [1972] N. I. 91 is misconceived. In that case the Parliament of Northern Ireland, in exercise of its powers under section 4 of the Government of Ireland Act 1920 to make laws for the peace, order and good government of Northern Ireland, had purported (by a regulation made in a statutory rule and order by the Minister of Home Affairs) to authorise certain members of Her Majestys forces to require an assembly of persons to disperse if a breach of the peace was apprehended. The Divisional Court held that the regulation was made in breach of section 4 (3) of the 1920 Act which forbade the making of laws by the Northern Ireland Parliament in respect of Her Majestys forces. It had been argued on behalf of the respondent that the pith and substance of the regulation was the peace, order and good government of Northern Ireland and that the conferring of powers on members of the armed forces was merely incidental. This argument was rejected, Lowry LCJ observing (at page 111) that both the object and the method of achieving it must be valid. Since the method in that case had been expressly forbidden, the regulation could not be rescued from its invalidity because it was for a permitted object. By contrast, in the present case the method (enlargement of the sentencing powers in sheriff summary proceedings) of achieving the object (the more efficient and expeditious prosecution of offences) is not expressly forbidden. For these reasons, and for the reasons more fully given by Lord Hope and Lord Rodger, I am therefore satisfied that section 45 of the Criminal Proceedings etc (Reform) (Scotland) Act 2007 does not relate to reserved matters within the meaning to be ascribed to that condition in section 29 (2) (b) of the Scotland Act 1998. I turn to briefly consider section 29 (4). It provides: (4) A provision which (a) would otherwise not relate to reserved matters, but (b) makes modifications of Scots private law, or Scots criminal law, as it applies to reserved matters, is to be treated as relating to reserved matters unless the purpose of the provision is to make the law in question apply consistently to reserved matters and otherwise. As I have already observed, this is a deeming provision which expands the category of cases in which a change in the law is to be considered to relate to reserved matters, although not so relating for the purposes of section 29 (3). Modifications of Scots private or criminal law are to be treated as relating to reserved matters subject to two important qualifications. The first of these is that such modifications are confined to the law as it applies to reserved matters. The advocate depute argued that section 45 of the 2007 Act modified Scots criminal law generally and on that account could not be said to apply solely to reserved matters. It appears to me, however, that this first qualification is not designed to exclude from the ambit of section 29 (4) modifications that relate to both reserved and devolved matters. It was suggested in argument that the purpose of the provision was to prevent the Scottish legislature from targeting reserved matters. This may well be correct but that objective is likely to be severely curtailed if a measure of the Scottish Parliament applying to reserved and devolved measures which were unrelated to each other was exempt from the reach of section 29 (4) and it appears to me that this must be the logical conclusion of the advocate deputes argument. A final determination of this issue is not, in my opinion, strictly necessary, however, because it is quite clear that the impugned legislation comes squarely within the second qualification in section 29 (4). A provision, the purpose of which is to make the law apply consistently to reserved matters and otherwise, is not caught by the subsection. It is unquestionably clear that section 45 of the 2007 Act has that precise purpose and for that reason it does not come within section 29 (4). The final and, to my mind, most troubling issue arises from section 29 (2) (c) of the 1998 Act. It states that a provision is outside the competence of the Scottish Parliament if it is in breach of the restrictions in Schedule 4 to the Act. Paragraph 2 of that Schedule contains the following material provisions: (1) An Act of the Scottish Parliament cannot modify, or confer power by subordinate legislation to modify, the law on reserved matters. (2) In this paragraph, the law on reserved matters means (a) any enactment the subject matter of which is a reserved matter and which is comprised in an Act of Parliament or subordinate legislation under an Act of Parliament, and (b) any rule of law which is not contained in an enactment and the subject matter of which is a reserved matter, and in this sub paragraph Act of Parliament does not include this Act. (3) Sub paragraph (1) applies in relation to a rule of Scots private law or Scots criminal law (whether or not contained in an enactment) only to the extent that the rule in question is special to a reserved matter . Section 45 of the 2007 Act self evidently relates to a rule of Scottish criminal law. Is the rule special to a reserved matter? Lord Hope has concluded that the rule is not special to a reserved matter because it does not increase the penalty that can be imposed in respect of the offence but has merely changed the procedural route by which the enlarged penalty can be imposed. It is concerned with a rule of procedure that applies generally to prosecutions for offences in the sheriff court. On this analysis, section 45 is not to be regarded as directed to a rule which is special to a reserved matter. By contrast, Lord Rodger considers that a statutory rule is special to a reserved matter if it has been enacted in order to apply specifically to the rule in question. I have not found it easy to reach a view as to which of these competing and persuasively argued positions is to be preferred. It is clear that paragraph 2 (3) contemplates an ambit or scope of application for a particular rule beyond its possible impact on reserved matters. It is only on the extent to which the application of the rule is special to reserved matters that the denial of legislative competence is engaged. In this context, special to may be regarded as connoting having a specific effect on reserved matters. Where an act of the Scottish Parliament seeks to modify a rule of Scots law which has an effect on reserved matters that act will be outside the legislative competence of the Scottish Parliament. But where the rule of Scots law being modified is not special to reserved matters, Parliaments legislative power remains intact. Viewing the effect of the provision in this way, I have concluded that where an act of the Scottish Parliament modifies a statutory rule which has a specific effect on a reserved matter it comes within the prohibition contained in paragraph 2 (1) of Schedule 4 to the 1998 Act. I therefore agree with Lord Rodger that section 45 is caught by that paragraph. The question then arises whether the section can be saved by recourse to paragraph 3 of Schedule 4 to the 1998 Act which provides: (1) Paragraph 2 does not apply to modifications which are incidental to, or consequential on, provision made (whether by virtue of the Act in question or another enactment) which does not relate to reserved matters, and do not have greater effect on reserved matters than is necessary to give effect to the purpose of the provision. Both Lord Hope and Lord Rodger have concluded that a statutory provision that alters the sentencing power of the sheriff court sitting in its summary jurisdiction cannot be regarded as coming within this provision. Although I was initially attracted by the notion that the increase in sentencing powers was incidental to a provision being made for the reallocation of court business, I have come to the view that this cannot be right. The increase in sentencing powers is the provision concerned. It is not incidental to another permissible statutory rule. It cannot be saved by paragraph 3, therefore. In the result, I agree with Lord Rodger that this appeal should be allowed.

As originally enacted, s.33 and Part 1 of Schedule 2 to the Road Traffic Offenders Act 1988 (the RTOA) provided that the maximum sentence that a Sheriff sitting summarily could impose in respect of the offence of driving while disqualified (s.103(1)(b) of the Road Traffic Act 1988 (the RTA)) was six months imprisonment or the statutory maximum fine or both. If the offence was prosecuted on indictment, the maximum sentence was 12 months imprisonment or a fine or both. Following a recommendation by a committee appointed to review the provision of summary justice in Scotland that the criminal jurisdiction of judges sitting summarily should be increased to a maximum of 12 months, the Criminal Proceedings etc (Reform)(Scotland) Act 2007 (the 2007 Act) was enacted by the Scottish Parliament. S.45 of that Act increased the maximum sentence that sheriffs sitting summarily could impose for the offence of driving while disqualified to 12 months imprisonment. On 17 December 2007 and 14 May 2008, respectively, in summary proceedings Sean Martin and Ross Miller were each sentenced by Sheriffs to periods in excess of six months imprisonment for driving while disqualified contrary to s.103(1)(b) of the RTA. They both sought to challenge their sentences on the basis that amending the relevant provisions of the 2007 Act were outside the legislative competence of the Scottish Parliament. The High Court of Justiciary (the HCJ) dismissed the appeals, holding that the increase in the sentencing power of Sheriffs sitting summarily by s.45 of the 2007 Act was within the Scottish Parliaments legislative competence. The HCJ gave the Appellants permission to appeal to the Supreme Court. The Supreme Court, by a majority of three to two (Lord Rodger and Lord Kerr dissenting), dismisses the appeals. The Court holds that the provision in question was within the Scottish Parliaments legislative competence. Lord Hope delivered the leading judgment on behalf of the majority. Majority Judgments The answer to the question raised by this case is to be found by applying the rules laid down in s 29 and Part 1 of Schedule 4 the Scotland Act 1998 which determine whether a provision of an Act is outside the Scottish Parliaments legislative competence. Three questions arise in this case: (1) whether the purpose of s.45 was to modify Scots criminal law as defined in s.126(5) of the Scotland Act; (2) if so, whether its purpose was to make the law apply consistently to reserved matters and otherwise; and (3) if (1) and (2) are answered in the affirmative, whether the rule that s.45 modified was special to a reserved matter within the meaning of para 2(3) of Schedule 4 [para [22]]. The purpose of s.45 of the Criminal Proceedings etc (Reform)(Scotland) 2007 Act The available material conclusively demonstrates that the purpose of s.45 was to contribute to the reform of summary justice by reducing pressure on the higher courts. The jurisdiction of a Sheriff is defined by the penalties which he can impose and his powers in this respect are quintessentially matter of Scots criminal law. S.45 was directed to a rule of Scots criminal law, so it does not relate to a reserved matter within the meaning of s.29(2)(b) of the Scotland Act 1998 [para [31]]. Was s.46 concerned to ensure that law applied consistently between reserved and non reserved matters? S.45 is one of a group of related provisions contained in the 2007 Act increasing the summary sentencing powers of Sheriffs in respect of a number of common law and statutory offences. If the 2007 Act had increased the sentencing power in respect of common law but not statutory offences the reform would have been incomplete and confusing. This problem would have been exacerbated if the reform had attempted to distinguish between statutory offences related to reserved matters and those which did not. The purpose of s.45 was to ensure that the law relating to the sentencing powers of Sheriffs was consistent as between offences concerning reserved matters and otherwise. Consequently, s.45 is not related to a reserved matter for the purpose of s.29(4) of the Scotland Act 1998 [paras [32] [33]]. Is the sentencing jurisdiction of a Sheriff in relation to road traffic offences special to the Road Traffic Offenders Act 1988 and the Road Traffic Act 1988? In identifying the rule of law that is being modified for the purpose of the test established by para 2(3) of Schedule 4, regard may be had to the purpose of the legislative provision effecting the modification [para [34]]. The key to the decision in this case lies in identifying the rule that is being modified. This is achieved by examining the purpose of the legislative provision which is under scrutiny [para [38] and [39]]. S.33 and Part 1 of Schedule 2 to the RTOA and s.103(1)(b) of the RTA contain, in effect, two rules of Scots criminal law. Firstly, that the overall maximum sentence in respect of driving while disqualified is 12 months. Secondly, the route by which the maximum sentence can be imposed. The former provision is plainly a rule that is special to the RTOA and RTA and is a reserved matter that the Scottish Parliament has no power to modify. However, the latter is a rule concerning Scots criminal jurisdiction and procedure which is not reserved. The change in the law effected by s.45 does not alter the maximum period of imprisonment for the offence of driving while disqualified. It relates to the procedure which determines whether the sheriff has power to impose that sentence. The rule of Scots law being modified is the rule of Scots criminal procedure. This rule of procedure is not special to the RTOA or RTA [para [37]]. Had it been necessary to address the point, para 3 of Schedule 4 (which provides that legislation having incidental or minor effects upon reserved matters shall be within competence) could not, contrary to the conclusion reached by the HCJ, render s.45 within the Scottish Parliaments legislative competence. s.45 constituted an important modification to a rule of Scots criminal procedure that could not be regarded as incidental or consequential [para [40]]. Accordingly the court holds that s.45 is within the legislative competence of the Scottish Parliament. The appeals are dismissed and remitted to the HCJ for any further orders that may be required [para [43]]. Dissenting Judgments Lord Rodger agreed that s.45 did not relate to a reserved matter [para [119]]. But he would have held that the provision of the RTOA prescribing the maximum term of imprisonment for a summary conviction for driving while disqualified is special to a reserved matter, in the sense that the United Kingdom Parliament has chosen it specifically for that offence. Lord Rodger did not agree that the purpose of the modifying provision can be a relevant consideration in identifying the rule of Scots law that is being modified for the purpose of para 2(3) of Schedule 4 [para [143]]. He also did not agree that the purpose of a provision which purports to modify a rule of Scots law can be used to determine whether that rule is special to a reserved matter [para [145]]. Lord Kerr agreed with Lord Rodger.

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In early 2006 the appellant, The United States of America, decided for strategic reasons to close the watercraft repair centre, known as RSA Hythe, which the United States Army maintained in Hampshire. The respondent, Mrs Nolan, was employed there as a civilian budget assistant, and the closure on 30 September 2006 involved her dismissal for redundancy on the previous day. She brought Employment Tribunal proceedings on 9 November 2006. The proceedings were brought under Part IV Chapter II, containing sections 188 to 198 of the Trade Union and Labour Relations (Consolidation) Act 1992 as amended by the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1995 (SI 1995/2587). I will call the Act as amended TULCRA and the Regulations by which it was amended the 1995 Regulations. Mrs Nolans complaint was that the appellant as her employer had, when proposing to dismiss her and other employees, failed to consult with any employee representative as required by the procedure for handling collective redundancies prescribed by Part IV Chapter II of TULCRA. There was no trade union at the base to represent Mrs Nolans and other employees interests. Accordingly, she made her complaint on the basis that she was an employee representative within section 188(1B). The appellant accepts that it made clear in June 2006 that there would be neither discussions nor consultation about the forthcoming closure. It denies that it was under the alleged duty. State immunity The appellant did not rely on state immunity when the proceedings were begun. It is common ground that it could successfully have done so. Whether this would have been under the State Immunity Act 1978 or at common law is presently immaterial. The 1978 Act is under section 16(2) inapplicable to proceedings relating to anything done by or in relation to the armed forces of a state while present in the United Kingdom. Assuming that section 16(2) applies, there would have been immunity under common law principles, summarised by Lord Millett in Holland v Lampen Wolfe [2000] 1 WLR 1573, 1583D F. Littrell v United States of America (No 2) [1995] 1 WLR 82 is an example of a successful common law plea of state immunity; see also Sengupta v Republic of India [1983] ICR 221. As to why there was no plea of state immunity, it was not apparent at the outset that the duty to consult under section 188 would apply to the closure of a base, rather than the consequences for employees after its closure. The potential for this extended understanding of the duty was only highlighted by the Employment Appeal Tribunal decision on 28 September 2007 in UK Coal Mining Ltd v National Union of Mineworkers (Northumberland Area) [2008] ICR 163. By then, the Employment Tribunal held, it was too late for the plea of state immunity which the appellant sought at that stage to raise. The validity of the extended understanding of the duty remains open to debate notwithstanding a later Court of Justice decision in Akavan Erityisalojen Keskusliitto (AEK) ry v Fujitsu Siemens Computers Oy (Case C 44/08) [2009] ECR I 8163, [2010] ICR 444, [2009] IRLR 944 (Fujitsu). TULCRA and EU law Section 188 of TULCRA is in general terms. Subsection 1 provides: (1) Where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less, the employer shall consult about the dismissals all the persons who are appropriate representatives of any of the employees who may be [affected] by the proposed dismissals or may be affected by measures taken in connection with those dismissals. Subsections (2) and (3) state the aims and nature of the required consultation. Subsection (7) provides: (7) If in any case there are special circumstances which render it not reasonably practicable for the employer to comply with a requirement of subsections (1A), (2) or (4) the employer shall take all such steps towards compliance with that requirement as are reasonably practicable those circumstances. Various types of public employment are or may be taken outside the Part IV Chapter II, or outside the Act as a whole. Service as a member of the armed forces and employment which a minister certifies as required to be excepted from the Act for the purpose of safeguarding national security are taken entirely outside the Act by sections 274 and 275. Under section 273(1) to (4) the provisions of Part IV Chapter II of TULCRA have, for present purposes, no effect in relation to Crown employment and persons in Crown employment. Crown employment here means employment under or for the purposes of a government department or any officer or body exercising on behalf of the Crown functions conferred by an enactment, and employee and contract of employment mean a person in Crown employment and the terms of employment of such a person subject to a presently immaterial exception. Employment as a relevant member of House of Lords or House of Commons staff is outside Part IV Chapter II under sections 277 and 278. Under section 280, the term employee or worker does not include a person in police service, defined as meaning service as a member of any constabulary maintained by virtue of an enactment, or in any other capacity by virtue of which a person has the powers or privileges of a constable. Finally, under section 286(2) the Secretary of State may by order made by statutory instrument provide that the provisions of inter alia Part IV Chapter II shall not apply to persons or employment of such classes as the order may prescribe, or shall only apply to them with such exceptions and modifications as the order may prescribe. Part IV Chapter II of TULCRA gives effect to the United Kingdoms duty under European Union law to implement Council Directive 98/59/EC and its predecessor Council Directive 77/187/EEC. As originally enacted, it did not do so fully, with the result that the Commission brought proceedings against the United Kingdom which led to a Court of Justice judgment dated 8 June 1994 in Case C 383/92 [1994] ECR I 2479, [1994] ICR 664. One flaw identified by the judgment was that TULCRA (and its predecessor the Employment Protection Act 1975) did not require consultation in circumstances where employees did not enjoy union representation recognised by the employer. The Court of Justice held that Council Directive 77/187/EEC required member states to ensure that employee representatives would be designated for consultation purposes in such circumstances. The 1995 Regulations make provision accordingly by amending section 188. The Directive contains the following articles: Definitions and scope Article 1 1. For the purposes of this Directive: collective redundancies means dismissals effected by (a) an employer for one or more reasons not related to the individual workers concerned where, according to the choice of the member states, the number of redundancies is: (i) either, over a period of 30 days: at least ten in establishments normally employing more than 20 and less than 100 workers, at least 10% of the number of workers in establishments normally employing at least 100 but less than 300 workers, at least 30 in establishments normally employing 300 workers or more, (ii) or, over a period of 90 days, at least 20, whatever the number of workers normally employed in the establishments in question; workers representatives means (b) the workers representatives provided for by the laws or practices of the member states. For the purpose of calculating the number of redundancies provided for in the first subparagraph of point (a), terminations of an employment contract which occur on the employers initiative for one or more reasons not related to the individual workers concerned shall be assimilated to redundancies, provided that there are at least five redundancies. 2. This Directive shall not apply to: (a) collective redundancies effected under contracts of employment concluded for limited periods of time or for specific tasks except where such redundancies take place prior to the date of expiry or the completion of such contracts; (b) workers employed by public administrative bodies or by establishments governed by public law (or, in member states where this concept is unknown, by equivalent bodies); (c) the crews of seagoing vessels. Final provisions Article 5 This Directive shall not affect the right of member states to apply or to introduce laws, regulations or administrative provisions which are more favourable to workers or to promote or to allow the application of collective agreements more favourable to workers. While TULCRA in its original form (and its 1975 predecessor) failed until the 1995 Regulations properly to implement European Union law in certain respects identified in the Court of Justices judgment in Case C 383/92 (para 6 above), in other respects they went beyond the requirements of such law. In particular: they provided until the 1995 Regulations that the consultation a) obligations arose if even a single redundancy was proposed; b) they provided for consultation at the earliest opportunity until 1995 (when this was replaced by the Directive requirement in good time) and further provided (as TULCRA continues to do) for specific time limits within which consultation must occur (there being no such time limits in the Directives); and c) they applied (and TULCRA continued until 2013 to apply) to fixed term contracts (to which the Directive under article 1(2)(a) does not apply). Most importantly for the present appeal, TULCRA in its original and amended form and its 1975 predecessor: d) contained and contain no express homologue of article 1(2)(b). They all exclude Crown employees and those in the police service. But they do not exclude public administrative bodies or public law establishments generally. The present proceedings The proceedings initiated by Mrs Nolan have not taken a straightforward course. She succeeded before the Employment Tribunal (LJ Guyer, Mrs S Foulser and Mr M W Heckford), obtaining on 17 March 2008 an order for remuneration for a one month protected period. The order was on 15 May 2009 upheld on appeal by the Employment Appeal Tribunal (Slade J, Mr D Norman and Mrs R Chapman). On a further appeal, the Court of Appeal (Laws, Hooper and Rimer LJJ) on 26 November 2010 ordered that there should be a reference to the Court of Justice on the question, raised by the decision in UK Coal, whether the obligation to consult arises (i) when the employer is proposing, but has not yet made, a strategic business or operational decision that will foreseeably or inevitably lead to collective redundancies; or (ii) only when that decision has actually been made and he is then proposing consequential redundancies? The Court of Justice did not answer this question (Case C 583/10) [2013] ICR 193. It raised the issue whether Mrs Nolans dismissal by the appellant, which is not an EU member state, fell within the scope of Directive 98/59/EC, having regard in particular to article 1(2)(b). Having heard submissions on this point, the court on 18 October 2012 gave a judgment with two parts. First, the court held that the Directive was both by virtue of its adoption under article 100 of the former EC Treaty (now article 94 TEU) and by nature part of the legislation aimed at improving the internal market; that activities like national defence, falling within the exercise of public powers, are in principle excluded from classification as economic activity; and that, by virtue of article 1(2)(b), the dismissal of staff of a military base falls outside the scope of the Directive, whether or not the base belongs to a non member state (para 43). Secondly, the court addressed Mrs Nolans submission that it should nonetheless rule on the question referred by the Court of Appeal, on the basis that TULCRA extends the provisions of the Directive in national law to cover article 1(2)(b) situations (other than in respect of Crown employment or employees and persons in the police service). The court (disagreeing on this point with Advocate General Mengozzis approach) declined to give any such ruling on the basis that If the EU legislature states unequivocally that the measure which it has adopted does not apply to a precise area, it renounces the objective [of] seeking uniform interpretation and application of the rules of law in that excluded area (para 55). The upshot was that the Court of Justice simply declined jurisdiction. So the questions raised by UK Coal/Fujitsu and the Court of Appeals reference will in the present case have to be resolved, if ever necessary, domestically without further assistance from the Court of Justice. Whether it will be necessary to resolve them in this case appears doubtful. The first part of the Court of Justices judgment lent encouragement to an argument by the appellant that, since EU law did not require or intend a foreign state to be subject to the Directives consultation obligations, United Kingdom law should be read in the same sense. When the matter came back before the Court of Appeal after the Court of Justices ruling, Mrs Nolan was prepared to concede the correctness in law of this argument and did not appear. The Court of Appeal (Moore Bick, Rimer and Underhill LJJ) [2014] ICR 685 after hearing submissions from Mr John Cavanagh QC and Sir Daniel Bethlehem QC for the appellant nonetheless dismissed the appeal, and made an order (stayed pending any appeal to the Supreme Court) that there be a further hearing to deal with the remaining UK Coal/Fujitsu issue. The appellant duly sought permission to appeal to the Supreme Court. This was given on the basis that the appellant bear its own costs in respect of the appeal, including those of any advocate to the court who might be appointed, and do not seek any costs order in respect of any instance of the proceedings. The appeal has proceeded on that basis and The Honourable Michael Beloff QC and Sarah Wilkinson have been appointed and appeared as advocates to the court. The government, which might be expected to have an interest in the third point (vires) identified in the next paragraph, has not sought to intervene. The issues The appellant has through counsel raised two points of construction and one of vires. The first point of construction, argued by Mr Cavanagh QC, is that the domestic legal provisions should be given an interpretation conforming to that given in the first part of the Court of Justices judgment, at least as regards foreign states jure imperii activity. By jure imperii, is here meant any decision or act which is not jure gestionis, (or commercial) in nature. A state enjoys no general immunity in respect of jure gestionis decisions or acts. The second point, argued by Sir Daniel Bethlehem QC, is that the same construction should be reached as regards foreign states by virtue of or by reference to principles of international law forming part of or inspiring domestic law. The third point, that of vires, argued by Mr Cavanagh, is that the 1995 Regulations were ultra vires section 2(2) of the European Communities Act 1972, in that, when providing workers without trade union representation with the protection which the Court of Justice held in (Case C 383/92) to be required, they did not confine themselves to the sphere of EU law, as confirmed by the court in the present case, but went further by conferring extended protection on workers without trade union representation employed by public administrative bodies or public law establishments. There is some overlap between the considerations relied upon by the appellant in relation to the two points of construction. The appellant focused on the overlap, which meant in its submission that TULCRA could not and should not on any view apply to foreign states jure imperii activity. The two points have however different underlying logics. The logic of the first point is that TULCRA should be construed so as not to apply to employment by any public administrative body or public law establishment. The logic of the second is that TULCRA should be construed so as not to apply to foreign states jure imperii activity. The third point, vires, only arises if neither point of construction is accepted. It would if accepted have an effect similar to the first point, but only in circumstances where there is no trade union representation. In circumstances where there is trade union representation consultation would be required by primary legislation (TULCRA without reference to the 1995 Regulations), so that no question of vires could arise. The first point of construction Taking the first point of construction, it is a cardinal principle of European and domestic law that domestic courts should construe domestic legislation intended to give effect to a European Directive so far as possible (or so far as they can do so without going against the grain of the domestic legislation) consistently with that Directive: Marleasing SA v La Comercial Internacional de Alimentacion SA (Case C 106/89) [1990] ECR I 4135, Vodafone 2 v Revenue and Customs Comrs [2009] EWCA Civ 446, [2010] Ch 77, paras 37 38 and Swift v Robertson [2014] UKSC 50, [2014] 1 WLR 3438, paras 20 21. But that means avoiding so far as possible a construction which would have the effect that domestic implementing legislation did not fully satisfy the United Kingdoms European obligations. Where a Directive offers a member state a choice, there can be no imperative to construe domestic legislation as having any particular effect, so long as it lies within the scope of the permitted. Where a Directive allows a member state to go further than the Directive requires, there is again no imperative to achieve a conforming interpretation. It may in a particular case be possible to infer that the domestic legislature did not, by a domestic formulation or reformulation, intend to go further in substance than the European requirement or minimum. R (Risk Management Partners Ltd) v Brent London Borough Council [2011] UKSC 7, [2011] 2 AC 34, considered below, is a case where the Supreme Court implied into apparently unqualified wording of domestic Regulations a limitation paralleling in scope that which had been implied by the Court of Justice into general wording of the Directive to which the Regulations were giving effect: see Teckal Srl v Comune di Viano (Case C 107/98) [1999] ECR I8121 (Teckal). It concluded that the two had been intended to be effectively back to back. A reformulation may also have been aimed at using concepts or tools familiar in a domestic legal context, rather than altering the substantive scope or effect of the domestic measure from that at the European level. But that is as far as it goes. Directive 98/59/EC introduces requirements in favour of workers engaged in fields of economic activity. But it leaves it open to member states to apply or introduce even more favourable laws, regulations or administrative provisions than those it requires (article 5), and, whether or not article 5 confirms this, it certainly leaves it open to member states to apply or introduce similar or more favourable provisions in areas of non economic activity, such as those of workers employed by public administrative bodies or public law establishments excluded from the Directive because of its internal market base and focus. Heavy reliance was placed by the appellant on the Supreme Courts decision in R (Risk Management Partners Ltd) v Brent London Borough Council and Harrow London Borough Council [2011] 2 AC 34, in furtherance of the appellants case that the Regulations must be limited in scope by reference to the Directive. The Supreme Court in Risk Management applied under the Public Contracts Regulations 2006 (SI 2006/5), passed to give effect to Council Directive 2004/18/EC, similar reasoning to that adopted by the Court of Justice in Teckal. In Teckal the Comune de Viano had decided, without inviting competing tenders, to switch responsibility for its fuel supplies and heating system servicing from a private company, Teckal, to a corporate entity (AGAC), set up by a consortium of Italian municipalities to provide energy and environmental services to the participating authorities. Teckal challenged this decision as breaching Directive 93/36/EEC (a predecessor to Directive 2004/18/EC) on supply of goods. The Court of Justice examined the principles determining whether the new arrangement fell within the Directive 93/36/EEC, which contained the following definitions in article 1: (a) public supply contracts are contracts for pecuniary interest concluded in writing involving the purchase, lease [,] rental or hire purchase, with or without option to buy, of products between a supplier (a natural or legal person) and one of the contracting authorities defined in (b) below. The delivery of such products may in addition include siting and installation operations; contracting authorities shall be the state, regional or (b) local authorities, bodies governed by public law, associations formed by one or several of such authorities or bodies governed by public law; The Court of Justice gave this guidance: 50. In that regard, in accordance with article 1(a) of Directive 93/36, it is, in principle, sufficient if the contract was concluded between, on the one hand, a local authority and, on the other, a person legally distinct from that local authority. The position can be otherwise only in the case where the local authority exercises over the person concerned a control which is similar to that which it exercises over its own departments and, at the same time, that person carries out the essential part of its activities with the controlling local authority or authorities. 51. The answer to the question must therefore be that Directive 93/36 is applicable in the case where a contracting authority, such as a local authority, plans to conclude in writing, with an entity which is formally distinct from it and independent of it in regard to decision making, a contract for pecuniary interest for the supply of products, whether or not that entity is itself a contracting authority. In Risk Management, Risk Management Partners Ltd (RMP) complained that Harrow London Borough Council had awarded insurance contracts to a mutual insurer established by various local authorities without going through the public contract award procedure required by the 2006 Regulations. The Regulations applied to a public services contract, defined as: a contract, in writing, for consideration (whatever the nature of the consideration) under which a contracting authority engages a person to provide services but does not include a public works contract; or a public supply contract; The Regulations contained a list of contracting authorities which included a local authority. Article 1 of the Directive, to which the Regulations gave effect, applied to public contracts, defined as: contracts for pecuniary interest concluded in writing between one or more economic operators and one or more contracting authorities and having as their object the execution of works, the supply of products or the provision of services within the meaning of this Directive. The Directive defined contracting authorities as meaning: the state, regional or local authorities, bodies governed by public law, associations formed by one or several of such authorities or one or several of such bodies governed by public law. There was nothing in the Regulations in issue in Risk Management positively to have prevented the legislator going further than European law required. Nonetheless, the Supreme Court in Risk Management read the wording as qualified so as to have a like scope to that which the Court of Justice had given the Directive in issue in Teckal. The Supreme Courts reasoning is however important. In his leading judgment, Lord Hope of Craighead noted that the Teckal exemption was not referred to anywhere in the Directive. It is a judicial gloss on its language (para 17), and went on to say (para 22) that: In the other leading judgment in the case, Lord Rodger of Earlsferry said to like effect (para 92): the basis for implying the Teckal exemption into the 2006 Regulations is to be found in their underlying purpose, which was to give effect to the Directive. The absence of any reference to the exemption in the Regulations is of no more significance than the absence of any reference to it in the Directive that was being transposed. The exemption in favour of contracts which satisfy its conditions was read into the Directive by the Court of Justice in Teckal because it was thought to be undesirable for contracts of that kind to be opened up for public procurement. This was not just a technicality. It was a considered policy of EU law. It would be odd if a significant and policy based exemption were to apply in some member states and not others, especially as one of the aims of the Directive was to harmonise procedures. The 2006 Regulations give effect to the Directive in English law. In other words, they are the way in which English law secures the free movement of services and the opening up to undistorted competition in relation to contracts which are to be placed by English local authorities. That being the purpose of the Regulations, they, too, cannot be meant to apply in circumstances where that purpose is not relevant because a contracting authority intends to contract with a body which is not properly to be regarded as an outside body. Although the Teckal criteria were formulated with particular reference to the predecessors of the Directive, they are simply a way of identifying situations where the authority can be regarded as obtaining the products or services which it requires in house and, so, where there is no need to secure the free movement of services and the opening up to undistorted competition. In my view, the criteria are an equally good indication of situations where, for that reason, the 2006 Regulations have no application. The insight of Advocate General Trstenjak in para 83 of her opinion in Coditel Brabant [2008] ECR I 8457, 8482 is instructive. To hold that the Regulations did apply in these circumstances would involve saying that the legislature intended to attach weight to competition law objectives in an area where they have no legitimate application. This would, in turn, involve inappropriate interference with local authorities right to co operate in discharging their public functions. Lord Hopes further observations about the domestic legal history of the Regulations are relevant not only to construction, but also to the third point on vires, which I consider later. He said (para 24): As Waller LJ said in Oakley Inc v Animal Ltd (Secretary of State for Trade and Industry intervening) [2006] Ch 337, para 39, the primary objective of any secondary legislation under section 2(2) must be to bring into force laws which, under the Treaties, the United Kingdom has agreed to make part of its laws. There is nothing in the explanatory memorandum to the Regulations that was prepared by the Office of Government Commerce and laid before Parliament to indicate that it was intended to depart from the jurisprudence of the court as to the scope of the Directive. In paras 7.2 7.4 of the memorandum it was stated that the change to the legislation was necessary to implement the new public procurement Directive, that it clarified and modernised the previous texts and that the simpler and more consistent public sector text should reduce the burdens involved under the EU rules. If the Teckal exemption were to be held not to apply to the 2006 Regulations, it could only be because the purpose of the Regulations was to apply the public procurement rules to relationships that fell outside the regime provided for by the Directive. But that would not be consistent with the memorandum, and it would not be a permitted use of the power. In Risk Management, the indications were that the domestic measure was intended in the relevant respect to be no more than back to back with the European Directive. That cannot be said to be so in the present case. TULCRA contains no equivalent of article 1(2)(b) of the Directive. Instead, it contains specific and limited exceptions for Crown employment and employees and for certain others in public service. It is true that the remainder of the category of public workers comprised by article 1(2)(b) would have been relatively confined, comprising those engaged in the exercise of public powers, rather than economic functions, as the Court of Justice indicated in Scattolon v Ministero dellIstruzione, dellUniversit, e della Ricerca (Case C 108/10) [2012] ICR 740, paras 43 44. But this remaining category is nonetheless significant. Contrary to the appellants submission, its inclusion within the scope of TULCRA cannot have been mere oversight. The careful exclusion of several specified categories of public employee speaks for itself. The variation of the Directive scheme enables, and according to the Employment Appeal Tribunal (para 84) has in many cases enabled, cases to be brought by those representing workers in public authorities. There are also other respects in which provisions of TULCRA have given protection in the form of consultation obligations which extends or has in the past extended, clearly deliberately, beyond the European requirement. It is, as Underhill LJ observed in the Court of Appeal (para 24) well understandable that a Labour government should in 1975, with trade union encouragement, have decided to give the scheme an extended domestic application to public employees. That does not mean that the legislator in the present case necessarily realised or foresaw the existence of employees of a public authority consisting of a foreign non EU member state such as the appellant, operating within the United Kingdom a base with its own employees. The appellant is the only foreign state with military bases in the United Kingdom, and it appears that civilian employees at United States Air Force (as distinct from Army) bases in the United Kingdom were and are, it seems, employed by the Crown. But the fact that a particular rare situation affecting a foreign state has not been foreseen is no reason for reading into clear legislation a specific exemption which would not reflect the wording or scope of any exemption in European law. This is particularly so, when the natural reaction to any suggestion that a foreign state might be adversely affected in its jure imperii decisions taken, according to the appellant, at the level of the US Secretary of Defense and US Secretary of the Army and in Washington would have been that the foreign state would be entitled to rely on state immunity, in response to any suggestion that it should have consulted with its workforce in relation to a strategic decision to close any such facility. While there is no positive indication that this played a part in legislative or ministerial thinking, it is a factor of relevance when considering whether objectively TULCRA must be read as containing any such implied limitation as the appellant suggests. The Court of Appeal and the advocates to the court also referred to section 188(7), with its limitation under special circumstances of any obligation to consult to whatever might be reasonably practicable in those circumstances. It may be that this could be of assistance to the appellant, in resisting a claim that it had breached the consultation obligations in section 188. But to my mind it provides an unconvincing basis for any conclusion that this was, or is objectively, the way in the legislator should be seen as having catered for the possible anomalies that might flow from expecting a sovereign state to consult about a jure imperii decision to close a naval or military facility. Section 188(7) is directed to special factual situations raising issues of feasibility apt for evaluation by the Employment Tribunal. It is much less obviously designed for situations where consultation might be thought to be incongruous for high policy reasons. The second point of construction I turn therefore to the second point of construction and to the additional considerations which it raises. As in the courts below, so before us the arguments advanced have been, as Slade J described them, both sophisticated and imaginative. They have also been careful and helpful in enabling the court to reach a conclusion on them. But like the courts below, I would reject them. In substance, Sir Daniel Bethlehems submission on behalf of the appellant is that international legal considerations should lead to the recognition by the court of a tailored exemption from TULCRA in respect of dismissals involving redundancies arising from a jure imperii decision taken by a foreign state. He does not suggest that, if TULCRA otherwise applies, the appellant enjoys any defence outside TULCRA (such as act of state, which would only here arise if the challenge was to a decision or act of the appellant in the United States). His case depends on construing TULCRA as inapplicable to what happened. His starting point is the prima facie presumption that the legislator intends to legislate consistently with, and that legislation (if reasonably capable of being so construed) should be construed consistently with, the principles of international law: Salomon v Customs and Excise Comrs [1967] 2 QB 116, Alcom Ltd v Republic of Columbia [1984] 1 AC 580 and Assange v Swedish Prosecution Authority [2012] UKSC 22, [2012] 2 AC 471, para 10. Reduced to their essence, his submissions regarding international law are that: a) the application of TULCRA to dismissals of this nature would conflict with settled international law principles that one state does not legislate to affect the jure imperii activity of another; b) it would place the appellant in a unique position of potentially infringing United Kingdom law, by failing to consult, when the Crown in respect of British bases would have no such obligation, and when EU principles of non discrimination would mean that other member states would also have to be regarded as having no such obligation; it would in that respect infringe either EU law or general international legal principles regarding non discrimination. Jurisdiction is primarily territorial in both international and domestic law. As the Permanent Court of International Justice said in The Case of the SS Lotus (1927) PCIJ Series A No 10, pp 18 19, that: the first and foremost restriction imposed by international law upon a state is that failing the existence of a permissive rule to the contrary it may not exercise its power in any form in the territory of another state. In this sense jurisdiction is certainly territorial; it cannot be exercised by a state outside its territory except by virtue of a permissive rule derived from international custom or from a convention. It does not, however, follow that international law prohibits a state from exercising jurisdiction in its own territory, in respect of any case which relates to acts which have taken place abroad, and in which it cannot rely on some permissive rule of international law. Such a view would only be tenable if international law contained a general prohibition to states to extend the application of their laws and the jurisdiction of their courts to persons, property and acts outside their territory, and if, as an exception to this general prohibition, it allowed states to do so in certain specific cases. But this is certainly not the case under international law as it stands at present. Far from laying down a general prohibition to the effect that states may not extend the application of their laws and the jurisdiction of their courts to persons, property and acts outside their territory, it leaves them in this respect a wide measure of discretion which is only limited in certain cases by prohibitive rules; as regards other cases, every state remains free to adopt the principles which it regards as best and most suitable. The following overview appears in Brownlies Public International Law 8th ed (2012), (ed by James Crawford SC, FBA), Chapter 21, pp 456 457: The starting point in this part of the law is the presumption that jurisdiction (in all its forms) is territorial, and may not be exercised extra territorially without some specific basis in international law. However, the territorial theory has been refined in the light of experience and what amounts to extra territorial jurisdiction is to some extent a matter of appreciation. If there is a cardinal principle emerging, it is that of genuine connection between the subject matter of jurisdiction and the territorial base or reasonable interests of the state in question. In the present case, the United Kingdom was in my opinion legislating in TULCRA entirely consistently with these principles. TULCRA is expressly stated to extend to England, Wales and Scotland. Part IV Chapter II regulates the procedures for dismissal on the grounds of redundancy of employees at institutions in those territories. It requires consultation within the jurisdiction with employees who are and whose employment is within the jurisdiction. Merely because the appellant may have taken a decision at the highest level in Washington, which led to dismissals on grounds of redundancy at a base in England, does not mean that the United Kingdom was legislating extra territorially. It is in this sort of situation that a plea of state immunity may be most useful. Sir Daniel Bethlehem referred to the American legal position, in particular the American Law Institute Restatement (Third) of the Foreign Relations Law of the United States (published May 14, 1986) and the United States Supreme Court decision of F Hoffmann la Roche v Empagran SA (2004) 542 US 155). Section 402 of the Reinstatement indicates that, subject to section 403, a state has jurisdiction to prescribe law with respect to (a) conduct that, wholly or in substantial part, takes place within its territory; (b) the status of persons, or interests in things, present within its territory; (c) conduct outside its territory that has or is intended to have substantial effect within its territory. The qualification in section 403 is that, even when one of the bases for jurisdiction under section 402 is present, a state may not exercise jurisdiction to prescribe law with respect to a person or activity having connections with another state when the exercise of such jurisdiction is unreasonable, this to be determined by evaluating all relevant factors. The drafters seek to give this evaluation some bones by listing eight potentially relevant (but not exclusive) factors. Among them are (a) the extent to which the activity takes place within the territory, or has substantial, direct and foreseeable effect upon or in the territory and (c) the character of the activity to be regulated, the importance of regulation to the regulating state, the extent to which other states regulate such activities . The US Supreme Courts decision in Hoffmann la Roche illustrates the significance of the principles in the Restatement. The case concerned the ambit of the Sherman Act in relation to a price fixing conspiracy between foreign and domestic vitamin sellers allegedly raising prices both inside and outside the United States. The issue was whether the Sherman Act applied to purchases (described as foreign transactions) by foreign distributors for delivery by Hoffmann la Roche outside the United States. The Foreign Trade Antitrust Improvements Act of 1982 (FTAIA) provided that the Sherman Act shall not apply to conduct involving trade or commerce with foreign nations unless (1) such conduct has a direct, substantial, and reasonably foreseeable effect (A) on trade or commerce which is not trade or commerce with foreign nations [ie domestic trade or commerce] (15 USC section 6a). The words trade or commerce with foreign nations were by the court held to cover foreign transactions. But the Court of Appeals had held that the qualifying words (unless ) brought all transactions, foreign and domestic within the Sherman Act. The US Supreme Court disagreed, holding that so far as the complaint depended on an adverse foreign effect on prices independent of any adverse domestic effect, it lay outside the scope of the Sherman Act. Breyer JA, giving the judgment of the court, identified two main reasons, derived from comity and the statutory history, for concluding that the FTAIA did not bring independently caused foreign injury within the scope of the Sherman Act. In their light he rejected linguistic arguments to the contrary advanced by the complainants. As to the first reason, comity, he said, in Part IV of the judgment (with characteristic emphasis, as italicised): this court ordinarily construes ambiguous statutes to avoid unreasonable interference with the sovereign authority of other nations. This rule of construction reflects principles of customary international law law that (we must assume) Congress ordinarily seeks to follow. See Restatement (Third) of Foreign Relations Law of the United States sections 403(1), 403(2) (1986) (hereinafter Restatement) (limiting the unreasonable exercise of prescriptive jurisdiction with respect to a person or activity having connections with another state); Murray v Schooner Charming Betsy, 2 Cranch 64, 118 (1804) ([A]n act of Congress ought never to be construed to violate the law of nations if any other possible construction remains); This rule of statutory construction cautions courts to assume that legislators take account of the legitimate sovereign interests of other nations when they write American laws. It thereby helps the potentially conflicting laws of different nations work together in harmonya harmony particularly needed in todays highly interdependent commercial world. No one denies that Americas antitrust laws, when applied to foreign conduct, can interfere with a foreign nations ability independently to regulate its own commercial affairs. But our courts have long held that application of our antitrust laws to foreign anticompetitive conduct is nonetheless reasonable, and hence consistent with principles of prescriptive comity, insofar as they reflect a legislative effort to redress domestic antitrust injury that foreign anticompetitive conduct has caused. But why is it reasonable to apply those laws to foreign conduct insofar as that conduct causes independent foreign harm and that foreign harm alone gives rise to the plaintiffs claim? Like the former case, application of those laws creates a serious risk of interference with a foreign nation's ability independently to regulate its own commercial affairs. But, unlike the former case, the justification for that interference seems insubstantial. See Restatement section 403(2) (determining reasonableness on basis of such factors as connections with regulating nation, harm to that nations interests, extent to which other nations regulate, and the potential for conflict). Why should American law supplant, for example, Canadas or Great Britains or Japans own determination about how best to protect Canadian or British or Japanese customers from anticompetitive conduct engaged in significant part by Canadian or British or Japanese or other foreign companies? The FTAIA was capable of interpretation in two senses. An interpretation which excluded from its grasp foreign transactions causing foreign damage was, for the reasons given in this passage, readily available and understandable. The present case presents a different picture. There is no lack of clarity in the wording of TULCRA. The base at RSA Hythe, the complainants, the contracts of employment and the dismissals for redundancy which were regulated (on the face of it) by TULCRA were and are all within the United Kingdom. I am ready to assume that the base was operated in the United Kingdom for strategic reasons, and it is common ground that the decision to close it was taken in the United States for strategic reasons. The appellants case is that there should be carved out of TULCRA, or any other relevant legislation, an exception for circumstances in which a foreign state takes a decision or commits an act of a jure imperii nature abroad which would otherwise lead to a person in the United Kingdom having a domestic right and remedy in respect of domestic employment or other domestic activity in the United Kingdom. The submission is far reaching. It would require substantial re formulation and expansion of the presumptive principles of construction referred to in the Restatement and in Hoffmann la Roche, and I am unable to accept it. The submission would amount, in effect, as Sir Daniel recognised, to reading domestic legislation as subject to an exception or as inapplicable, at least prima facie, in relation to a foreign state in any circumstances where the foreign state could rely on a plea of state immunity, to avoid the adjudicative processes of another state in which proceedings had been brought against it. I do not accept that there is any such principle. It would make quite largely otiose the procedures and time for a plea of state immunity. As Hazel Fox CMG QC and Philippa Webb observe in The Law of State Immunity 3rd ed (2013), p 20: Jurisdiction and immunity are two separate concepts. Jurisdiction relates to the power of a state to affect the rights of a person or persons by legislative, executive or judicial means, whereas immunity represents the independence and exemption from the jurisdiction or competence of the courts and tribunals of a foreign state and is an essential characteristic of a state. Logically the existence of jurisdiction precedes the question of immunity from such jurisdiction but the two are inextricably linked (see Chapter IV). In Chapter IV, p 82, the authors go on further to explain the relationship, in this passage: Immunity comports freedom or exemption from territorial jurisdiction. It bars the bringing of proceedings in the courts of the territorial state (the forum state) against another state. It says nothing about the underlying liability which the claimant alleges. Immunity does not confer impunity; the underlying accountability or substantive responsibility for the matters alleged in a claim remain; immunity merely bars the adjudication of that claim in a particular court. As a matter of logic, the determination of jurisdiction precedes the consideration of immunity. A states latitude to assert immunity in the face of a claim is different from the inapplicability of the law, by way of exemption or otherwise, to the impugned conduct of the foreign state in the first place. Immunity operates as a bar to the adjudicative jurisdiction of the courts of the forum state. It does not address the legislative or prescriptive jurisdiction of that state. A claim of immunity thus at some level acknowledges the forum states legislative competence and the putative application of the domestic law in question to the foreign state but for the assertion of immunity. In its written case, para 116, the appellant put the same point in a way met with the advocates to the courts assent: Sir Daniel Bethlehem sought to emphasise the importance for a foreign state such as the appellant of recognising in TULCRA an implied exemption for a decision to dismiss for redundancy taken on jure imperii grounds. The appellant would wish to comply with domestic law, and the ability to plead state immunity in any proceedings would not alter the fact that, without such an exemption, it would be and have been in breach of domestic law. That is true, but carried to its logical conclusion it would mean that all legislation should, however clear in scope, be read as inapplicable to a foreign state in any case where the state could plead state immunity. That would elide two distinct principles, and, as noted already, very largely make redundant a plea of state immunity at least in respect of any statutory claim. On Sir Daniels argument, the legislation relating to unfair dismissal on which the claimant relied in Sengupta v Republic of India [1983] ICR 221 would presumably also have to be read as containing an implied exception for foreign states in jure imperii contexts, as would perhaps also the principles of common law negligence on which the claimant relied in Littrell v United States of America (No 2) [1995] 1 WLR 82. Sir Daniel Bethlehems submissions on discrimination start with the exclusion from the scope of Part IV Chapter II of TULCRA of Crown and police service employees. The exclusion is specific, and that itself makes it difficult to argue for an equivalent implied exclusion in respect of foreign state employees. In any event, there are circumstances in which, even on Sir Daniels case, it would not be inappropriate for Part IV Chapter II to apply to a foreign government, for example in the (admittedly perhaps rare) case where a foreign state was itself responsible for a commercial activity in the United Kingdom, in respect of which it wished to declare all or some of its employees redundant. Be that as it may be, Sir Daniel argues that non discrimination is a general principle of international law. It was in terms accepted as such by the Court of Appeal in Benkharbouche v Embassy of the Republic of Sudan [2015] EWCA Civ 33, [2015] 3 WLR 301, para 61, but the context there was a claim by an individual foreign employee, asserting that section 4 of the State Immunity Act was contrary to articles 6 and 14 of the European Convention for the Protection of Human Rights and Fundamental Freedoms and/or European Union law. (This was because it only lifted a foreign states immunity in favour employees with contracts made in the United Kingdom or work to be wholly or partly performed there if such employees were nationals of or habitually resident in the United Kingdom.) A state cannot take advantage of articles 6 and 14 of the European Convention. Articles 1 and 2 of the Universal Declaration of Human Rights, article 26 of the International Covenant on Civil and Political Rights and article 14 of the European Convention, cited by the Court of Appeal, are likewise all provisions by states in favour of persons, not states. I will return to articles 20 and 21 of the Charter of Fundamental Rights of the European Union, which the Court of Appeal also cited. The position as between states is expressed in Oppenheims International Law 9th ed (1992) as follows, at para 114: Although states are equal as legal persons in international law, this equality does not require that in all matters a state must treat all other states in the same way. There is in customary international law no clearly established general obligation on a state not to differentiate between other states in the treatment it accords to them. Nevertheless, discrimination is widely regarded as undesirable, and in some particular respects a rule of non discrimination may exist, within limits which are not clear. Oppenheim goes on to discuss some possibilities, eg multi lateral treaties, none of which is relevant here. To give teeth to his submissions, Sir Daniel Bethlehem invokes European Union law, to which the Court of Appeal in Benkharbouche also referred. Article 18 TFEU provides: Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited. The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may adopt rules designed to prohibit such discrimination. A provision in, effectively, the same terms as the first sentence is contained in the Charter of Fundamental Rights, article 21(2). On the basis of these provisions, Sir Daniel argues that United Kingdom courts would have to recognise other member states of the European Union as enjoying like exemptions from TULCRA to those TULCRA provides for UK Crown employees. This would in principle leave non EU states out on a limb, but the only non EU state actually shown to be affected would in practice be or be likely to be the appellant. That would, Sir Daniel submits, be absurd and should itself lead to an implication that foreign states should enjoy the like immunity. In any event, he submits, the principle of non discrimination operates under European Union law horizontally to protect the appellant, even though it is neither a European citizen or an EU member state; in this connection, Sir Daniel invokes the Court of Justices well known if controversial jurisprudence in Mangold v Helm (Case C 144/04) [2006] All ER (EC) 383 and Kckdeveci v Swedex GmbH & Co KG (Case C 555/07) [2010] All ER (EC) 867, both in fact cases of age discrimination. Whether article 18 TFEU and/or article 21(2) of the Charter of Fundamental Rights apply in favour of member states can be left open. Whether, if they do, it would be open to a member state to rely on them horizontally as against a complainant like Mrs Nolan can also be left open. It is not clear in European law how far and when the principles in Mangold and Kckdeveci apply in cases not involving age discrimination. The court considered such an issue in Association de mdiation sociale v Union locale des Syndicates CGT (Case C 176/12) [2014] ICR 411. The domestic Labour Code excluded from calculation holders of an accompanied employment contract (young persons being directed towards more stable employment or social activities), of whom the Association de mdiation sociale (AMS), a private non profit making organisation, employed well over 100. The result of the exclusion was that AMS counted as having only eight employees under the Labour Code, and so fell domestically below a threshold of 50 (based on the Directive 2002/14/EC) which would otherwise have triggered obligations on its part to inform and consult. The court held that the Labour Code by excluding accompanied employees from the calculation of numbers was in breach of the Directive. Article 27 of the Charter requires that Workers or their representatives must, at the appropriate levels, be guaranteed information and consultation in good time in the cases and under the conditions provided for by Union law and national laws and practices. The question thus arose whether article 27 of the Charter, read with the Directive, could be relied on horizontally in proceedings between AMS and the Union locale des Syndicates. Differing on this point from Advocate General P Cruz Villaln, the Court of Justice held that it could not, saying that it was clear from the wording of article 27 of the Charter that, for this article to be fully effective, it must be given more specific expression in European Union or national law (para 45). This was so although the Labour Code must, it appears, have contained specific provisions regarding information and consultation for those employers who, under its own defective method of calculation, did have 50 or more employees. So it is at least open to question whether article 18 TFEU or article 21(2) of the Charter, read with the provisions of TULCRA, would necessarily have direct horizontal effect in favour of another EU member state. There are however to my mind two fundamental flaws in Sir Daniels submissions at this point. The first is that articles 18 and 21(2) apply expressly only within the scope of application of European law, or, as it was paraphrased in Association de mdiation sociale, para 42, in situations governed by European law. The same point was made by the Court of Justice as long ago as 1974 in Walrave v Association Union Cycliste Internationale (Case C 36/74) [1974] ECR 1405. In the present case, the Court of Justice declined to rule on the interpretation of Directive 98/59/EC for the very reason that, to the extent that TULCRA covers workers employed by public administrative bodies or by public law establishments, it goes beyond European Union law into an area to which the EU legislature states unequivocally that the measure which it has adopted does not apply, and in which the objective [of] seeking uniform interpretation and application of the rules of law has been renounced: para 55. Since the issue in the present case arises in precisely that area, it is not possible to conclude that the appellant or indeed any EU member state, let alone any non member state, could insist on European Union law as giving it any horizontal or other entitlement. The second flaw is that I do not regard a non member state as being within the protection of articles 18 and 21(2) in any circumstances. In Patmalniece v Secretary of State for Work and Pensions [2011] UKSC 11, [2011] 1 WLR 783, para 83, Lady Hale said of the then equivalent article: This is not a general prohibition of discrimination on grounds of nationality. Only the nationals of member states are protected. Discrimination against third country nationals is not prohibited. Indeed it is positively expected. The underlying purpose is to promote the objects of the Union and in particular the free movement of workers between the member states and the free establishment of businesses within them. The Court of Justices case law is to like effect: Vatsouras v Arbeitsgemeinschaft (AGRE) Nrnberg 900 (Joined Cases C 22/08 and C 23/08) [2009] ECR I 4585, [2009] ALL ER (EC) 747, para 52 and Martinez Sala v Freistaat Bayern (Case C 85/96) [1998] ECR I 2691, para 62. The Court of Appeal recently reached the same conclusion in Sanneh v Secretary of State for Work and Pensions [2015] EWCA Civ 49, para 106. The freedom of this countrys universities to charge unrestricted tuition fees to non EU citizens, while having in this respect to assimilate citizens of other EU countries with British citizens, is an example of the impact of this principle. For these reasons, I am unable to accept the appellants second point on construction any more than its first. The third point the vires of the 1995 Regulations I come to the third point, the appellants submission that the 1995 Regulations were ultra vires section 2 of the European Communities Act 1972. When providing workers without trade union representation with the protection which the Court of Justice had in (Case C 383/92) held to be required, the Regulations did not confine themselves to the sphere of EU law, confirmed by the court in the present case. They went further by conferring extended protection on workers without trade union representation employed by public administrative bodies or public law establishments. In that respect, the appellant submits, they went beyond any power conferred by section 2. Section 2 of the 1972 Act (as amended by sections 27 and 33 of the Legislative and Regulatory Reform Act 2006 and sections 3 and 8 of and Part I of the Schedule to the European Union (Amendment) Act 2008) reads: General implementation of Treaties (1) All such rights, powers, liabilities, obligations and restrictions from time to time created or arising by or under the Treaties, and all such remedies and procedures from time to time provided for by or under the Treaties, as in accordance with the Treaties are without further enactment to be given legal effect or used in the United Kingdom shall be recognised and available in law, and be enforced, allowed and followed accordingly; and the expression enforceable EU right and similar expressions shall be read as referring to one to which this subsection applies. (2) Subject to Schedule 2 to this Act, at any time after its passing Her Majesty may by Order in Council, and any designated Minister or department may by order, rules, regulations or scheme, make provision (a) for the purpose of implementing any EU obligation of the United Kingdom, or enabling any such obligation to be implemented, or of enabling any rights enjoyed or to be enjoyed by the United Kingdom under or by virtue of the Treaties to be exercised; or (b) for the purpose of dealing with matters arising out of or related to any such obligation or rights or the coming into force, or the operation from time to time, of subsection (1) above; and in the exercise of any statutory power or duty, including any power to give directions or to legislate by means of orders, rules, regulations or other subordinate instrument, the person entrusted with the power or duty may have regard to the objects of the EU and to any such obligation or rights as aforesaid. (3) (4) The provision that may be made under subsection (2) above includes, subject to Schedule 2 to this Act, any such provision (of any such extent) as might be made by Act of Parliament, and any enactment passed or to be passed, other than one contained in this part of this Act, shall be construed and have effect subject to the foregoing provisions of this section; but, except as may be provided by any Act passed after this Act, Schedule 2 shall have effect in connection with the powers conferred by this and the following sections of this Act to make Orders in Council or orders, rules, regulations or schemes. Schedule 2 paragraph 1 (as amended by section 32 of the Criminal Law Act 1977 and sections 38 and 46 of the Criminal Justice Act 1982) contains the following restriction on the powers conferred by section 2(2): The powers conferred by section 2(2) of this Act to make provision for the purposes mentioned in section 2(2)(a) and (b) shall not include power to make any provision imposing or increasing (a) taxation; or to make any provision taking effect from a date (b) earlier than that of the making of the instrument containing the provision; or (c) to confer any power to legislate by means of orders, rules, regulations or other subordinate instrument, other than rules of procedure for any court or tribunal; or (d) to create any new criminal offence punishable with imprisonment for more than two years or punishable on summary conviction with imprisonment for more than three months or with a fine of more than level 5 on the standard scale (if not calculated on a daily basis) or with a fine of more than 100 a day. Section 2 of the 1972 Act recognises the different types of EU legislative measure. Article 288 TFEU states a well known trifurcation: A Regulation shall have general application. It shall be binding in its entirety and directly applicable in all member states. A Directive shall be binding, as to the result to be achieved, upon each member state to which it is addressed, but shall leave to the national authorities the choice of form and methods. A decision shall be binding in its entirety. A decision which specifies those to whom it is addressed shall be binding only on them. Section 2(1) gives the force of law in the United Kingdom to all the rights, etc and remedies and procedures to which it refers, which are in accordance with the Treaties without further enactment to be given legal effect or used in the United Kingdom. It is the means by which Regulations have effect. Section 2(2) concerns obligations of the United Kingdom to be implemented, or rights of the United Kingdom to be enjoyed, under or by virtue of the Treaties. A right or obligation under a Directive is the classic instance. As article 288 indicates, Directives are not as specific as Regulations in their impact or, often, in their terms. Member states have a degree of latitude in their implementation, provided they achieve the intended result. Paragraph (a) of section 2(2) enables provision to be made by order in council or ministerial or departmental order, rule, regulation or scheme for the purpose of implementing any such obligation, or enabling any such right to be exercised. Paragraph (b) enables provision to be made for dealing with matters arising out of or related to any such obligation or rights or the coming into force, or the operation from time to time of subsection (1). The ambit of section 2(2) has been considered in a number of cases. The leading authority is Oakley Inc v Animal Ltd [2005] EWCA Civ 1191, [2006] Ch 337. Since then section 2(2) has been considered by Moses LJ in R (Cukorova Finance International Ltd) v HM Treasury [2008] EWHC 2567 (Admin), [2009] EuLR 317, by Lord Hope in Risk Management [2011] 2 AC 34 (para 22 above), by the Employment Appeal Tribunal in Pothecary Witham Weld v Bullimore [2010] ICR 1008 and by Floyd J, who identified as many as 14 relevant principles in ITV Broadcasting Ltd v TV Catchup Ltd (No 2) [2011] EWHC 1874 (Pat), [2011] FSR 40. In Oakley, Directive 98/71/EC on the legal protection of designs required member states to approximate their legislation, but provided an option permitting them to derogate and retain in force existing legislation for registered designs. The option, found in article 11(8) of the Directive, read: 8. Any member state may provide that, by way of derogation from paragraphs 1 to 7, the grounds for refusal of registration or for invalidation in force in that state prior to the date on which the provisions necessary to comply with this Directive enter into force shall apply to design applications which have been made prior to that date and to resulting registrations. In issuing the Registered Designs Regulations 2001 (SI 2001/3949), the Secretary of State made use of this option. By regulation 12 he retained in force the Registered Designs Act 1949, as amended in 1988, in relation to designs already registered, so making use of this option. The Court of Appeal rejected the submission that regulation 12 required primary legislation. All three members of the court considered that regulation 12 could be regarded as being within section 2(2)(a) of the 1972 Act, as having been for the purpose of implementing an EU obligation or enabling one to be implemented (para 29, per Waller LJ, para 46 per May LJ and paras 64 67 per Jacob LJ). All three members of the court also went on to express views on the scope of section 2(2)(b). Waller LJ considered that the words used in section 2(2)(b) must take their context from the primary purpose of section 2, that being the bringing into force under section 2 of the laws, which under the Treaties the United Kingdom has agreed to make part of its laws; para 39. On that basis he added this in the same paragraph: section 2(2)(b), from its position in section 2, from the fact that it adds something to both subsections (1) and (2), and from its very wording is a subsection to enable further measures to be taken which naturally arise from or closely relate to the primary purpose being achieved. I accept that I will be accused of adding the words naturally and closely, but I believe that describes the context which provides the meaning of the words. May LJ said (para 47): I do not consider that to hold that the making of these transitional provisions came within section 2(2)(a) has the effect of making section 2(2)(b) devoid of content. There is a distinction between providing something which, although it is a choice, is a choice which the implementation of the Directive requires you to make, and one which is not so required, but which has the effect of tidying things up or making closely related original choices which the Directive does not necessarily require. Section 2(2)(b) is confined by its words and context. Redefinition in the abstract is to be avoided. Jacob LJ addressed the topic in some detail. He had no doubt that section 2(2)(a) covered the case where a Directive contains explicit alternatives and the implementing statutory instrument merely selects one of these (para 73). Questioning whether it also covers the supply of detail which Directives frequently leave to member states to spell out, he observed that, in his view, the wider section 2(2)(a), the narrower section 2(2)(b) is likely to be (para 74). In paras 79 80 he expressed his provisional views: 79. My own view, provisional though it must be in the absence of any specific context relevant to this case, is this: that section 2(2)(a) covers all forms of implementation whether by way of choice of explicit options or by way of supply of detail. Both of these are for the purpose of implementing or enabling any such obligation to be implemented. Supplying detail required by a Directive is just that. 80. So section 2(2)(b) indeed adds more . How much more must depend on the particular circumstances of the case the statutory language is the guide. It says for the purpose of dealing with matters arising out of or related to. Whether a particular statutory instrument falls within those words must depend on what it purports to do and the overall context. One cannot put a gloss on the meaning. If Otton LJ [in R v Secretary of State for Trade and Industry, Ex p UNISON [1996] ICR 1003] was adding a gloss distinct, separate or divorced from it then I do not agree with that gloss. You just have to apply the statutory language to the case concerned. And in doing so you bear in mind that the purpose of the power given by the section is European the article10 purpose. Whether or not Otton LJ was right in the circumstances of, I do not decide. It would not be right to do so in the absence of the affected parties. The reference to Otton LJs words was to a sentence in which Otton LJ said that he was satisfied that the provision made was related to a Community obligation, and not distinct, separate, or divorced from it (R v Secretary of State for Trade and Industry, Ex p UNISON [1996] ICR 1003, 1014G H). Article 10 of the then Treaty establishing the European Community read: Member states shall take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of this Treaty or resulting from action taken by the institutions of the Community. Some general observations are possible, arising from these passages. First, so far as possible, it is clearly desirable to avoid paraphrase, though almost impossible to do so completely, if any greater light is to be shed on the scope of their application. Second, as Waller LJ (and also May LJ) indicated, words such as those used in section 2(2) must be seen in the context of the primary purpose of section 2, that being the bringing into force under section 2 of the laws, which under the Treaties the United Kingdom has agreed to make part of its laws. Third, that is the context in which Parliament was prepared to delegate law making ability to the executive because the focus of section 2(2) is on obligations to the implementation of which the United Kingdom is already committed (and rights to which it is already entitled) at the European level by virtue of its EU membership. Parliament will itself have had prior opportunities for scrutiny of, and input into the content of, the European measures giving rise to such obligations and rights, through in particular Select Committee procedures, at the stage when such measures were being developed and proposed by the European Commission and considered in Europe by member states and the European Parliament. Fourth, section 2(2) authorises the making of provisions for two differently expressed purposes. In the case of paragraph (a), the purpose expressed is implementing or enabling the implementation of any EU obligation (or the enabling the exercise of any EU right enjoyed by the United Kingdom). In the case of paragraph (b), it is dealing with matters arising out of or related to any such obligation or rights or the coming into force, or the operation from time to time, of section 2(1). It is not in my view appropriate to get too involved in a linguistic debate about whether these paragraphs should be read entirely disjunctively or whether there may be some overlap. But Jacob LJ was, I think, right in saying that the wider section 2(2)(a), the narrower section 2(2)(b) is likely to be that is so, because the language of paragraph (b) introduces bottom line limitations of the power it confers. What can in my view be said, from the wording and positioning of these two paragraphs, is that paragraph (a) is the main vehicle for implementation of EU obligations and rights which are not directly enforceable. Paragraph (b) goes further, in authorising provision for different purposes, but those purposes are limited by reference to the United Kingdoms EU obligations or rights (or the coming into force, or operation, of section 2(1)). The words arising out of limit the power to provisions dealing with matters consequential upon an EU obligation or right (or the coming into force, etc, of section 2(1)). The further phrase related to any such obligation or rights, must, unless redundant, go somewhat further. But the relationship required must exist objectively; and the positioning of the phrase and its conjunction with the earlier wording of section 2(1) suggest to me, as they did to Waller and May LJJ, that by speaking of a relationship the legislature envisaged a close link to the relevant obligation or right. A relationship cannot on any view arise from or be created by simple ministerial decision that it would be good policy or convenient to have domestically a scheme paralleling or extending EU obligations in a field outside any covered by the EU obligations. That would be to treat paragraph (b) as authorising a purpose to implement policy decisions not involving the implementation of, not arising out of and unrelated to any EU obligation. A fifth and final point is that it is, in the light of the above, possible to describe section 2(2) as both wide and confined in scope. It is wide because it authorises almost every conceivable provision required to fulfil the United Kingdoms obligations under article 4.3 TEU (or to give effect to any EU right) subject only to the restrictions in Schedule 2. It is confined because any such provision must be for the purpose of implementing, or dealing with a matter arising from or related to, such an obligation or right. Some conclusions can fairly readily be drawn. Consistently with a view taken, I understand, by all members of the court in Oakley, it is clear, that, where a Directive is in general terms leaving member states freedom to decide on the precise means for its implementation, provisions which the United Kingdom makes within the scope of such freedom will on the face of it fall within section 2(2)(a), as being for the purpose of implementing or enabling the implementation of the Directive. Second, where a Directive confers a choice of specific alternatives, as Directive 98/59/EC did in article 1(1)(a) (see para 7 above) a provision selecting one or other alternative will also fall within section 2(2)(a). Where a Directive gives member states a specific option to derogate from its provisions in a particular respect in Oakley as regards design applications made prior to the date of domestic implementation of the Directive and as regards resulting registrations then I again agree with the court in Oakley that the exercise of this option can be regarded as falling within section 2(2)(a), and, further, that if that were not so, then it would, in any event, be related to the implementation of the United Kingdoms EU obligation within section 2(2)(b). At the other end of a spectrum is a situation such as Lord Hope considered in Risk Management, para 24 (para 22 above). That is where a Directive, such as Directive 2004/18/EC in that case, (i) addresses an internal market competition issue, by introducing procedures for the award of public works, supply and service contracts, but does not cover a situation where (ii) public authorities contract inter se, or where (iii) a local authority exercises over the other contracting party a control which is similar to that which it exercises over its own departments and, at the same time, that person carries out the essential part of its activities with the controlling local authority or authorities: see Teckal (Case C 107/98) [1999] ECR I 8121, para 50. In that context, Lord Hope, with whose judgment three other members of the court agreed, considered that it would not be a permitted use of the power conferred by section 2(2) to apply the public procurement rules to relationships [such as those in (ii) and (iii)] that fell outside the regime provided for by the Directive: para 22 above. In agreement with Lord Hope, I consider that, where a Directive is based on an internal market competence and as a result limited in impact to internal market situations, its domestic extension to situations outside the internal market cannot be regarded as being within either section 2(2)(a) or (b) of the 1972 Act. This is so whether it is so limited by implication or expressly. More difficult are intermediate situations where a Directive is limited to, or specifically excludes, a particular area of the internal market. An example of a Directive limited to a particular area of the internal market is Directive 2002/47/EC which was in issue in Cukurova [2009] EuLR 317. Directive 98/59/EC in issue in the present case is an example of a Directive with both limitations and specific exclusions which appear to fall within the internal market: It is limited by article 1(1)(a) to collective redundancies. It excludes in article 1(2)(a) limited period contracts, which might affect the functioning of the internal market competition. I say nothing on the question whether the exclusion in article 1(2)(c) of the crews of seagoing vessels operates in an area which might affect the internal market or was because this was seen as a situation, like that covered by article 1(2)(b), where the internal market was not affected. In my view, provisions extending an EU regime domestically into areas not covered by or specifically excluded from the EU regime contemplated by a Directive may well fall outside both paragraphs of section 2(2). Each case would have to be considered on its own merits. Some adjustments to situations in which a Directive operates may be regarded as necessary or appropriate for the purpose of implementing or enabling the implementation of a Directive, or as being related to the relevant EU obligation in the sense already discussed. Pothecary [2010] ICR 1008 is an example of a case where the Secretary of State used section 2(2)(b) to provide for a reverse burden of proof in section 63A of the Sex Discrimination Act 1975 (as inserted by regulation 5 of the Indirect Discrimination and Burden of Proof) Regulations 2001 (SI 2001/2660) in cases of alleged victimisation. There was no obligation under European law to have a reverse burden in such cases. There was under the Burden of Proof Directive 97/80/EC an obligation to have a reverse burden in cases of alleged unequal treatment, but the Employment Appeal Tribunal concluded that the right not to be victimised did not form part of the principle of equal treatment, but was an ancillary right accorded by EU law to render that principle properly enforceable. On that basis, it held, unsurprisingly, that introducing a reverse burden in respect of a right which European law treated as ancillary to its prohibition of discrimination was dealing with a matter related to an EU obligation, within section 2(2)(b). In Cukurova Directive 2002/47/EC was expressly limited to transactions between certain institutions, but the Financial Collateral Arrangements (No 2) Regulations 2003 (SI 2003/3226) issued by HM Treasury implementing it extended the range of the regime to cover other institutions. Moses LJ was concerned with a question whether Cukurova should be allowed an extension of time within which to challenge the vires of the Regulations. Ultimately, all he did was express such considerable doubts about Cukurovas prospects of success in its challenge as to lead him to a conclusion that justice did not demand an extension of time. Nonetheless, it is worth looking at the case more closely, because in my view Moses LJ greatly underestimated the force of Cukurovas challenge. Article 1(1) of Directive 2002/47/EC stated that it lays down a Community regime applicable to financial collateral arrangements [defined by article 2.1(a) as meaning a title transfer financial or a security financial collateral arrangement] which satisfy the requirements set out in paragraphs 2 and 5 and to financial collateral in accordance with the conditions set out in paragraphs 4 and 5. Paragraph 2 stated that The collateral taker and the collateral provider must each belong to one of the following categories. These included a wide range of (a) public authorities or bodies, (b) central or development banks, (c) financial institutions subject to prudential supervisions and (d) central counterparties, settlement agents or clearing houses as well as (e) a person other than a natural person, including unincorporated firms and partnerships, provided that the other party is an institution as defined in points (a) to (d). By these categories, the Directive notably did not cover hedge funds. Paragraph 3 permitted member states to exclude from the scope of this Directive financial collateral arrangements where one of the parties is a person mentioned in paragraph 2(e). Recital 22 stated the objective of the Directive to be to create a minimum regime relating to the use of financial collateral, this being an objective which, it went on, cannot be sufficiently achieved by the member states and can therefore be better achieved at Community level . In place of the carefully delineated categories of institution and concern covered by the Directive, the 2003 Regulations put in place a regime covering title transfer financial collateral arrangements and security financial collateral arrangements where the collateral provider and the collateral taker are both non natural persons: regulation 3. I find it difficult to see how this could be regarded as having been for the purpose of implementing or enabling the implementation of the EU Directive. Equally, the extension did not arise out of the obligations in the Directive and was not related to them. It was on its face the product of a decision by HM Treasury that it would be good policy domestically to have a more extensive regime operate within the United Kingdom. That is something which was of course open to the United Kingdom under European law, since the Directive was a measure of minimum harmonisation. But it was under the United Kingdom constitution and the 1972 Act a matter which was not for the executive to decide, but for Parliament to consider and, it if thought fit, to agree as a matter of primary legislation. Returning to the present case, it falls in my view even more clearly within the category which Lord Hope was considering in Risk Management. It also concerns a Directive issued by the European legislature under its internal market competence, which in the present case specifically excludes by article 1(2)(b) situations outside that competence. The express liberty in article 5 for member states to make provisions more favourable to workers does not in my view lead or point to a contrary view. It cannot have been directed to matters which would be outside the European Unions internal market competence. Even in relation to matters within the Unions internal market competence, an article of this nature does no more on its face than confirm that the Directive is a minimum harmonisation measure, which leaves member states free to introduce more favourable provisions as a matter of domestic law. This does not mean that such provisions are necessarily to be regarded as dealing with matters related to any EU obligation or rights. It follows that, had the provisions of TULCRA in its unamended form been the product of subordinate legislation under section 2(2) of the 1972, they would, on Lord Hopes analysis, have been ultra vires at least in so far as they purported to extend the required procedure for dismissals involving redundancies to situations falling within article 1(2)(b) of Directive 98/59/EC. However, TULCRA in its unamended form was actually a piece of primary legislation. So far as Parliament chose by TULCRA in its unamended form to extend the required procedure for dismissals involving redundancies, it was fully entitled to do so. Parliament has no need to show any particular competence base for primary legislation. It can legislate at will and at the same time achieve both European Union aims and domestic aims, as long as the latter are not positively inconsistent with the former. But TULCRA in its unamended form was confined to situations where the relevant employees had trade union representation. When the executive chose to rectify this by using section 2(2) of the 1972 Act to cover situations where there was no trade union representation, it did so across the whole width of the previous legislation so as to affect not only situations within the internal market scope of Directive 98/59/EC, but also the domestic situations to which Parliament had also extended the required procedure for dismissals. If Lord Hopes analysis is correct, does this mean that the amendments to TULCRA by the 1995 Regulations must to that extent be regarded as ultra vires? I have found this a difficult and borderline question to answer. Ultimately, I have come to the conclusion that it can and should be answered in the negative. TULCRA in its unamended form represented a unified domestic regime. The Court of Justice in 1994 identified a flaw in the protection provided, in that it did not cater for non trade union situations. It is entirely unsurprising that the 1995 Regulations did not distinguish between parts of TULCRA which were and were not within the internal market competence or within article 1(2)(b) of the Directive. I think that, in these unusual circumstances, Parliament can, by enacting TULCRA in its unamended form, be regarded as having created, for the future domestic purposes of the 1972 Act, a relationship between the EU obligation (which it was a primary object of Part IV Chapter II of TULCRA in its unamended form to implement) and the categories of public employment falling within article 1(2)(b) of Directive 98/59/EC (which Parliament decided without any EU obligation to do so to cover by TULCRA in its unamended form). That relationship having been established by TULCRA in its unamended form, it seems to me that the executive was entitled to take it into account and to continue it by and in the 1995 Regulations. Conclusion For all these reasons, I would dismiss the appellants appeal on all three points, and affirm the judgments of the courts below. The case should as a result be remitted to the Court of Appeal for determination, so far as necessary, of the UK Coal/Fujitsu issue referred to in paras 3 and 10 11 of this judgment. LORD CARNWATH: (dissenting) Overview This case has an unfortunate procedural background, which has been described by Lord Mance. Among other grounds raised by the appellants (which in agreement with my colleagues I would dismiss), it raises two difficult issues at the interface between European and domestic law: first, the extent of the power conferred by section 2(2)(b) of the European Communities Act 1972 to legislate in the UK by statutory instrument on matters arising out of or related to obligations under European law; secondly, the approach of the domestic court to an issue of European law (the Fujitsu issue see below) which arises under a UK statute modelled on a European Directive, but which has been held to be outside the competence of the European court. As will be seen, the two are in my view linked. Unfortunately, only the first is before this court on the present appeal. The second will have to be determined by the Court of Appeal if the present appeal fails, and may return here at a later date. There is the further difficulty that neither of the parties to the appeal has more than a limited interest in the resolution of either issue as a matter of law. The United States of America, as appellant, has no direct interest in the resolution of issues of English or European law. It is only before the court because it failed at an early stage (for understandable reasons at the time) to claim sovereign state immunity. (It is common ground that if a claim to state immunity had been made at the outset it would have succeeded.) Mrs Nolan, the nominal respondent, has not contested the appeal, either in the Court of Appeal or in this court. The UK government, which might be thought to have a substantial interest in both issues has chosen not to intervene, though informed of the appeal. In these unusual circumstances we are more than usually grateful for the assistance of Mr Beloff QC and Miss Wilkinson as advocates to the court. However, it is no reflection on them that we have been unable to explore in any detail the wider implications of this case for the transposition of European law in this country more generally. For this reason, had my colleagues agreed with my firm provisional view that the appeal should be allowed on this issue, I would have been reluctant to reach a final conclusion without allowing the UK government a further opportunity to submit representations. The conclusions set out below are to that extent provisional. I adopt gratefully Lord Mances exposition of the facts and the relevant statutory provisions. Procedural history Lord Mance has summarised the procedural history, but some expansion may be helpful in setting the scene for discussion of the issue on which we are divided. As he has noted, an important event was the decision of the Employment Appeal Tribunal, in UK Coal Mining Ltd v National Union of Mineworkers [2008] ICR 163), given in September 2007. To explain its importance I can refer to Underhill LJs summary [2014] ICR 685, para 9: The trend of English authority until comparatively recently was to the effect that the collective redundancy provisions, even when read with the Directive, did not oblige an employer to consult about, or therefore disclose the reasons for, the underlying business decision which gave rise to a proposed collective redundancy the paradigm case being the closure of a workplace but only about the consequences of that decision. However, the decision of the ECJ in Junk v Khnel (Case C 188/03) [2005] ECR I 885, raised a serious question whether that approach was compatible with EU law. In UK Coal Mining , the Employment Appeal Tribunal (Elias J, President, presiding) declined explicitly to depart from the established approach (while expressing some reservations about it); but it nevertheless held that in a case where a decision to close a workplace and the consequent decision to make redundancies were inextricably interlinked the obligation to consult about the reasons for the latter necessarily involved an obligation to consult about the reasons for the former and thus required the employer to initiate consultations prior to the closure decision. The CJEU revisited this issue in Akavan Erityisalojen Keskusliitto (AEK) ry v Fujitsu Siemens Computers Oy (Case C 44/08) [2010] ICR 444; [2009] ECR I 8163 (the Fujitsu decision); but unfortunately the effect of its reasoning is, to put it no higher, not entirely clear. As Underhill LJ explained (para 10), this change of understanding had important implications for the present case, in particular in the context of the USAs failure to rely before the tribunal on sovereign immunity: On the approach which it had initially taken, which involved acceptance of an obligation to consult only about the consequences for employees of the closure of the base, there had been no need for the USA to take any point on its status as a sovereign state. But the approach espoused in the UK Coal case was unacceptable to it: it did not believe that it should or could be under any legal obligation to consult with employees about a decision to close a military base, which is an act done jure imperii. It was not until the remedy hearing that the USA sought for the first time to invoke state immunity; but the tribunal held that it had already submitted to the jurisdiction. That conclusion is not now in issue. Before the EAT Mr John Cavanagh QC, who represented the USA, argued, as he has before us, that as a matter of construction, and in order to avoid absurdity, section 188 should be read as excluding any obligation by a sovereign state employer to consult about a decision made jure imperii. That submission was rejected by both the EAT and the Court of Appeal. In the Court of Appeal he further submitted that in the light of the Fujitsu decision, the reasoning in UK Coal [2008] ICR 163 should not be supported, with the consequence that consultation on the business decision to close the base had not been required. In the course of a detailed review of the reasoning of the Advocate General and the CJEU in the Fujitsu case, Rimer LJ (giving the judgment of the court) [2010] EWCA Civ 1223 sought an answer to what he identified as the critical question: does the ECJ explain whether the consultation obligation arises (i) when the employer is proposing, but has not yet made, a strategic business or operational decision that will foreseeably or inevitably lead to collective redundancies; or (ii) only when that decision has actually been made and he is then proposing consequential redundancies? (para 57) He inclined to the view that the Advocate General had favoured option (ii) (para 53). But he was unwilling to venture a concluded view on the position of the court, which he considered unclear (para 59), and which could be only resolved by the CJEU itself. Notwithstanding the USAs express unwillingness to support a reference, he saw it as important not just to the disposition of this litigation but also to industrial practice generally (para 62). Before the CJEU, as Lord Mance has noted, the case took an unexpected turn. Prompted by observations of the Commission, the court invited submissions on whether, having regard to the exclusion for public administrative bodies in article 1(2)(b), the dismissal was outside the scope of the Directive, with the result that the court would have no jurisdiction to decide the question. Its answer (in its judgment of 18 October 2012, (Case C 583/10), [2013] ICR 193) was no (for reasons to which I shall return below). Accordingly, when the appeal came back to the Court of Appeal, the issue had to be considered as one of domestic law only. At the second Court of Appeal hearing, the primary submission for the USA was that, in order to achieve conformity with the Directive, words should be read into section 188 to exclude its operation to a foreign state engaged in the exercise of public powers. This was rejected by Underhill LJ (with whom the other members of the court agreed). The draftsman had made a deliberate decision not to extend the exclusion to all public administrative bodies. This was unsurprising, given that the concept of a special employment regime for public employees recognised in some civil law countries has no equivalent in the common law, and it made sense for Parliament to have settled for a touchstone for exclusion which used common law concepts and would be (comparatively) easy to apply in the United Kingdom. He added that the Labour Government in 1975 may have had policy reasons to extend the collective redundancy provisions to public administrative bodies, such as local authorities, given the influence at the time of public sector trade unions (para 24). Having rejected the argument that amendments made under the European Communities Act 1972 had been outside the powers conferred by the Act, he concluded that there would need to be a further hearing to determine the Fujitsu issue. It was regrettable but unavoidable that an issue which will in almost all other cases albeit not in this depend on EU law will have to be decided without the guidance of the CJEU (para 33) It was further ordered that in the event of an appeal to the Supreme Court, the further hearing on the Fujitsu issue should await the outcome of the appeal. The reasoning of the CJEU The European court held that the armed forces fell clearly within the exception for public administration or equivalent bodies under article 1(2)(b). This was also supported by the objectives of the Directive, concerned with improving the protection of workers and the functioning of the internal market (para 39): 41. Whilst the size and functioning of the armed forces does have an influence on the employment situation in a given member state, considerations concerning the internal market or competition between undertakings do not apply to them. As the Court of Justice has already held, activities which, like national defence, fall within the exercise of public powers are in principle excluded from classification as economic activity It followed that dismissal of staff of a military base did not fall within the scope of the Directive, irrespective of whether or not it is a military base belonging to a non member state. (para 43) The court also considered an argument that, even if the case fell outside the Directive, it was able to give a preliminary ruling, following cases in which the court had accepted jurisdiction where EU law had been rendered applicable by reference in domestic law. The court explained the limits of that principle: 46. The court has already held that where, in regulating situations outside the scope of the EU measure concerned, national legislation seeks to adopt the same solutions as those adopted in that measure, it is clearly in the interest of the European Union that, in order to forestall future differences of interpretation, provisions taken from that measure should be interpreted uniformly 47. Thus, an interpretation by the court of provisions of EU law in situations outside its scope is justified where those provisions have been made applicable to such situations by national law in a direct and unconditional way in order to ensure that internal situations and situations governed by EU law are treated in the same way However, the court noted, in paras 49 and 50, that the USA had had the opportunity in the tribunal to rely on state immunity, or on special circumstances under section 188(7). It followed that the court did not have sufficiently precise indications that the national law made the solutions adopted by the Directive automatically applicable in such a case (para 51), so as to make the provisions of the Directive applicable in a direct and unconditional way (para 52). The court continued: 53. It is true that it is in the interests of the Union to safeguard the uniformity of the interpretations of a provision of an EU measure and those of national law which transpose it and make it applicable outside the scope of that measure. 54. However, such is not the case where, as in the case in the main proceedings, an EU measure expressly provides a case of exclusion from its scope. 55. If the EU legislature states unequivocally that the measure which it has adopted does not apply to a precise area, it renounces, at least until the adoption of possible new EU rules, the objective seeking uniform interpretation and application of the rules of law in that excluded area. 56. Therefore, it cannot be stated or presumed that there was an interest of the Union that, in an area excluded by the EU legislature from the scope of the measure which it adopted, there should be a uniform interpretation of the provisions of that measure. The vires issue The arguments The scope of section 2(2)(b) was considered by the Court of Appeal in Oakley Inc v Animal Ltd [2005] EWCA Civ 1191, [2006] Ch 337. The Registered Design Regulations 2001 were made under section 2(2) in order to implement Directive 98/71/EC, concerning the approximation of laws relating to registered designs. Article 11(8) was a transitional provision which granted member states the option of retaining their old laws in relation to designs that were already registered. The Court of Appeal rejected an argument that the transitional provisions in the Regulations went further than permitted by the Directive. Of section 2(2)(b) Waller LJ said that the words arising out of and related to should be read in the context of section 2 itself, the primary purpose of which was to give effect to the laws which under the EU Treaties the United Kingdom had agreed to make part of its own laws. He observed: It seems to me that section 2(2)(b) from its position in section 2, from the fact that it adds something to both subsections (1) and (2), and from its very wording is a subsection to enable further measures to be taken which naturally arise from or closely relate to the primary purpose being achieved. (para 39) (emphasis added) May LJ contrasted sections 2(2)(a) and (b): There is a distinction between providing something which, although it is a choice, is a choice which the implementation of the Directive requires you to make, and one which is not so required, but which has the effect of tidying things up or making closely related original choices which the Directive does not necessarily require. Section 2(2)(b) is confined by its words and context . (para 47) (emphasis added) In the present case the Court of Appeal accepted that the 1995 Regulations were not within the scope of section 2(2)(a) of the 1972 Act, but held that they were authorised by section 2(2)(b). Underhill LJ said: The decision to go beyond the requirements of the Directive by extending the employee representative rights to employees in PABs (except those in Crown employment) may, as a matter of strict analysis, reflect a substantive policy choice made by the Secretary of State; but, as the judgments in the Oakley Inc case make clear, that is not in itself objectionable. In fact all that he was doing was plugging the rights created by the Regulations in cases where no trade union was recognised into the pre existing scheme of the Act and thereby reproducing, in the case of this late discovered lacuna in the implementation of the Directive, the selfsame decision as Parliament had already made in enacting the primary legislation in 1975 and 1992. It would indeed have been an extraordinary anomaly if the kinds of employment where the obligation to consult arose differed as between cases where a trade union was recognised and cases where it was not; and it was not only natural but right for the Secretary of State in making the 1995 Regulations to ensure that the position was the same in both cases. In my judgment this is precisely the kind of closely related original choice which the Directive does not require but which has the effect of tidying things up that May LJ identifies in his judgment in Oakley Inc case. (para 32) In this court, Mr Beloff QC supports the reasoning of the Court of Appeal. Article 5 of the Directive made clear that the Directive sought to achieve minimum harmonisation only. Member states were free to enact laws more favourable to workers than those required by the Directive. Section 188, as applied to public administrative bodies, arose out of the obligations under the Directive in the sense of extending them further, as the UK was entitled to do by article 5, or alternatively it related to those because the subject matter (the right to consultation) was identical to the right to be consulted in the Directive. By the same token, the 1995 Regulations, in filling a gap in the UK legislation identified by the European court in Commission of the European Communities v United Kingdom (Case C 383/92) [1994] ICR 664 fell squarely within the scope of section 2(2)(b) of the 1972 Act under which they were made. This reasoning is challenged by Mr Cavanagh QC. Mrs Nolans employment by the public employers such as the USA was not within the scope of the 1992 Act as enacted by Parliament. It was brought within it solely by the amendments made by the 1995 Regulations. The Court of Appeal were right to find that the Regulations were outside the scope of section 2(2)(a), but were wrong to find that they were within section 2(2)(b) as matters arising out of or related to a community obligation. The CJEU judgment in the present case has made clear that decisions relating to the closure of foreign military bases are within an area excluded by the EU legislature from the scope of the measure which it adopted (judgment para 56). It follows that, in so far as the 1995 Regulations purported to extend the application of section 188 to employee representatives in such cases, they had nothing to do with this countrys Community obligations, but arose solely from domestic policy considerations. They were not dealing with matters arising out of or related to EU obligations in any relevant sense. Discussion I start from the words of Lord Hope in R (Risk Management Partners Ltd) Brent London Borough Council [2011] 2 AC 34, para 24: It is true that section 2(2) of the European Communities Act 1972 is in wide terms. It does not confine any measures made under it to doing the minimum necessary to give effect to a Directive. But, if it is to be within the powers of the subsection, the measure has to arise out of or be related to an EU obligation. As Waller LJ said in Oakley Inc v Animal Ltd , the primary objective of any secondary legislation under section 2(2) must be to bring into force laws which, under the Treaties, the United Kingdom has agreed to make part of its laws The words related to in section 2(2)(b) taken out of context are so wide as to be almost meaningless. A relationship may be very close or very distant without distortion of the word. In one sense, as Mr Beloff QC appeared to suggest, any provision dealing with employees rights to consultation could be said to be related to the subject matter of this Directive, and hence within the scope of the section. More specifically, it may be said in the present context, Parliament has in the 1992 Act established a clear and direct relationship, as a matter of domestic law, between the employments covered by the Directive, and the extension to equivalent employments under public administrative bodies. If that were sufficient, then it would no doubt follow that, when legislative action was required to fill gaps in the transposition of the Directive into domestic law, the same relationship would cover the decision to take equivalent action in respect of the extension. In Oakley the Court of Appeal sought to avoid an unduly broad interpretation by introducing additional qualifications: naturally arising, closely related, tidying up. Such glosses are not justified by normal rules of interpretation, and may beg as many questions as they solve. Thus in the present case, it may be said that extending the 1995 Regulations to public administrative bodies is closely related to to the main purpose of the amendments, or (as Underhill LJ thought) simply a matter of tidying up the 1992 Act in the light of the European courts decision. Such language provides no answer to the underlying problem that the relationship is one created entirely by a domestic statute, and has no obvious relevance to the purpose of the 1972 Act. Some limitation is necessary to ensure that the power to legislate outside the normal Parliamentary process is kept within bounds. The key, as Lord Hope said, at [2011] 2 AC 34, para 25, must lie in the context. The relationship must be one relevant to the purpose of the legislation, that is to give effect to the UKs obligations in European law. In other words it must be a relationship derived in some way from European law, not one dictated solely by considerations of domestic law. On the other hand, as the language makes clear, the power is not confined to matters which arise directly from the European obligation the minimum necessary in Lord Hopes words, at para 24. Related to implies the possibility of a less direct connection. The interpretation of the 1972 Act is of course a matter ultimately for the domestic, not the European courts. However, the reasoning of the CJEU in the present case suggests the basis for a principled and workable distinction, corresponding to the limits of its own jurisdiction. This would have the additional advantage of avoiding the problem, noted by Underhill LJ, of a European question of general importance (the Fujitsu issue) having to be decided without the possibility of recourse to the European court. The court saw its jurisdiction as extending to cases where European provisions are made applicable by national law in a direct and unconditional way to internal situations outside their direct scope. A relationship adequate to give jurisdiction to the European court might be thought an adequate relationship also for the purpose of the 1972 Act. However, that solution is not available in this case. The effect of article 1(2)(b), as found by the court, is to exclude public administrative bodies entirely from the scope of the Directive, and to renounce any European interest in that excluded area. I note with respect the different view taken by Lord Mance on what he describes as a difficult and borderline question. As I understand his judgment (para 71), he might have reached a different conclusion, if TULCRA in its amended form had been the product of subordinate rather than primary legislation. I would only comment that I find it difficult to understand why the status of the original legislation should impinge materially on the relationship required by section 2(2)(b) to support the 1995 Regulations. Mr Beloff QC relies on article 5 of the Directive by which member states are permitted to introduce laws or other measures which are more favourable to workers . Although the CJEU did not refer in terms to article 5, its reasoning makes it difficult to see the present extension as coming within its scope. That allows terms more favourable to workers as defined in the Directive. But by article 1.2(b), as interpreted by the CJEU, the Directive has no application to workers in public administrative bodies, who are outside its scope altogether and hence outside the reach of article 5. The power of the national legislature to extend similar protection to such workers is a matter purely of domestic competence, and owes nothing to the Directive. I should add that the same reasoning does not necessarily apply to time limited contracts, which, as already noted, are excluded by article 1(2)(a) of the Directive, but not from the domestic legislation. Employees under such contracts may still be workers for the purposes of the Directive, and therefore potentially within the scope of article 5. Conclusion I find it difficult therefore to avoid the conclusion that the extension of the 1995 Regulations to public administrative bodies, such as the appellants, was not within the power conferred by the 1972 Act, and that the appeal should be allowed on this ground. I reach this position with some diffidence, given that the wider implications of this interpretation of the 1972 Act have not been explored, and we have had no submissions from the UK government which is primarily interested in those issues. As already indicated, before reaching a final decision, I would have wished to invite the UK government to make representations on this issue. That will not now be necessary, in view of the opposite conclusion reached by Lord Mance, with the agreement of the rest of the court. I regret that, because of the narrow basis on which the appeal has come before us, we have not been able to provide any assistance on the resolution, as a matter now of domestic law, of the difficult Fujitsu issue, which, unless the parties otherwise agree, will have to revert to the Court of Appeal. For these reasons, I would have allowed the appeal on the vires issue, but dismissed all the other grounds of appeal.

In 2006 the United States of America (USA) closed a watercraft repair centre (the Base) which it maintained in Hampshire. Mrs Nolan was employed at the Base by the appellant and was dismissed for redundancy the day before it closed. Mrs Nolan complained that the appellant had failed to consult with any employee representative when proposing to dismiss her. The appellant denies any such duty. Mrs Nolan brought Employment Tribunal proceedings under Part IV Chapter II of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULCRA) as amended by The Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1995 (SI 1995/2587) (the 1995 Regulations). TULCRA as originally enacted by Parliament went beyond the requirements of European law under Council Directive 77/187/EEC (or now under Council Directive 98/59/EEC) in extending a right to be consulted prior to redundancies to employees of public administrative bodies, such as those at the Base. But it fell short of European law in that it was confined to circumstances where employees enjoyed union representation recognised by the employer. In 1994 the Court of Justice identified this failure, and in consequence the Secretary of State relying on the power to make secondary legislation conferred by section 2(2) of the European Communities Act 1972 (the 1972 Act) made the 1995 Regulations which amended TULCRA to require employee representatives to be designated for consultation purposes in all situations covered by TULCRA. On the basis of TULCRA as amended, Mrs Nolan succeeded before the Employment Tribunal and was granted an order for remuneration for a one month period. This Employment Appeal Tribunal upheld the order. The Court of Appeal referred to the Court of Justice the question whether the obligation to consult arose on a proposal or only on a decision to close the base (the UK Coal Mining and Fujitsu issue: see [2008] ICR 163 and Case C 44/08; [2009] ECR I 8163). The Court of Justice declined jurisdiction, holding that (i) Directive 98/59/EEC being an internal market measure covering economic activities, national defence and the dismissal of staff at a military base are outside its scope; and (ii) it was not appropriate to rule on a question relating to a public administrative establishment to which the Directive did not apply. The Court of Appeal ordered a further hearing of the UK Coal Mining/Fujitsu issues. The USA appeals to the Supreme Court on three grounds: (1) TULCRA should in the light of the Court of Justices ruling be construed as not applying to employment by a public administrative establishment, at least as regards non commercial (jure imperii) activity such as closure of a military base decided at the highest level in Washington; (2) the same result should be reached in the light of principles of international law and EU law; (3) In any event, the Secretary of State exceeded the powers conferred by s.2 of the 1972 Act when making the 1995 Regulations, in so far as these went further than EU law requires by protecting workers without trade union representation employed by public administrative establishments. The Supreme Court dismisses the USAs appeal by a majority of 4:1. The case is remitted to the Court of Appeal for determination, as necessary, of the UK Coal/ Fujitsu issues. Lord Mance gives the lead judgment, with which Lord Neuberger, Lady Hale and Lord Reed agree. Lord Carnwath dissents. Ground (1): That the present situation might not have been foreseen by the legislature is not a reason for reading into clear legislation a specific exemption which would not reflect the scope of any exemption in EU law, especially when the foreign state could have invoked state immunity but did not do so in time [24, 25]. The USAs first submission is rejected [26]. Ground (2): Jurisdiction is primarily territorial in both international and domestic law [29 30]. TULCRA regulates the procedures for dismissal on the grounds of redundancy of employees at institutions in England, Wales and Scotland. The UK is not legislating extra territorially when it covers proposals or decisions about domestic redundancies developed or taken abroad [31]. TULCRA contains no exception for such cases. The USAs submission would render largely otiose the procedures and time for a plea of state immunity. State immunity is an adjudicative bar separate from a foreign states underlying responsibility. The USAs case elides two distinct principles. [35 38]. This appeal concerns situations covered by TULCRA but falling outside EU law, so the USA cannot rely on EU law as entitling it to protection from discrimination [45]. Further EU law does not protect third country nationals from discrimination or therefore non member states [46 47]. The USAs second submission is therefore also rejected [47]. Ground (3): The power conferred under s.2(2) of the 1972 Act to make delegated legislation for the purpose of dealing with matters related to any obligation of the United Kingdom under EU law envisages a close link between the content of any such legislation and the relevant obligation [61]. While each case must be considered on its merits, the domestic extension of an EU regime into areas outside or specifically excluded from that regime may well fall outside s.2(2) [66]. In the present case, however, Parliament had by its original enactment of TULCRA established a unified domestic regime drawing no distinction between different parts of TULCRA within or outside the EUs internal market competence. In these unusual circumstances, Parliament could be taken to have created for the domestic purposes of s.2(2) of the 1972 Act a relationship which the Secretary of State was entitled to take into account and continue by and in the 1995 Regulations [72]. The submission that the 1995 Regulations went beyond the Secretary of States powers in protecting employees of public administrative establishments without trade union representation would therefore also be rejected [77 73]. Lord Carnwath (dissenting) considers that the relationship between TULCRA and the Directive created by domestic statute has no obvious relevance to the purpose of the 1972 Act [94 95]. Some limitation is necessary to ensure that the power to legislate outside the normal parliamentary process is kept within bounds [96]. Lord Carnwath would dismiss the appeals on the first two issues, but allow the appeal on the third issue [100 101]. the Courts decision. It does not form part of the reasons for the decision. The full judgment of the Court is the only authoritative document. Judgments are public documents and are available at: http://supremecourt.uk/decided cases/index.html

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These appeals raise important and difficult issues in the field of equity and trust law. Both appeals raise issues about the so called rule in Hastings Bass. One appeal (Pitt) also raises issues as to the courts jurisdiction to set aside a voluntary disposition on the ground of mistake. It is now generally recognized that the label the rule in Hastings Bass is a misnomer. The decision of the Court of Appeal in In re Hastings Bass, decd [1975] Ch 25 can be seen, on analysis, to be concerned with a different category of the techniques by which trust law controls the exercise of fiduciary powers. That decision is concerned with the scope of the power itself, rather than with the nature of the decision making process which led to its being exercised in a particular way (see R C Nolan, Controlling Fiduciary Power [2009] CLJ 293, especially pp 294 295 and 306 309). The rule would be more aptly called the rule in Mettoy, from the decision of Warner J in Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587. But the misnomer is by now so familiar that it is best to continue to use it, inapposite though it is. As Mettoy illustrates, the rule is concerned with trustees who make decisions without having given proper consideration to relevant matters which they ought to have taken into consideration. It has also been applied to other fiduciaries (in Pitt Mrs Pitt was acting as a receiver appointed by the Court of Protection). Mettoy was concerned with the rules of an occupational pension scheme, as are some other cases on the rule. But since the turn of the century there have been several cases concerned with family trusts, and in particular with taxplanning arrangements involving trusts, where the arrangements have for one reason or another proved unexpectedly disadvantageous, and the court has been asked to restore the status quo ante under the Hastings Bass rule. Futter is such a case, as Norris J pointed out in blunt terms at the beginning of his judgment, [2010] EWHC 449 Ch, [2010] STC 982, para 2: This is another application by trustees who wish to assert that they have acted in an un trustee like fashion and so have failed properly to exercise a power vested in them. The trustees wish to take advantage of this failure to perform their duties in order to enable the beneficiaries to avoid paying the tax liability consequent upon the trustees decision. Put like that (and I am conscious that that is not the only way in which the situation may be described) the possibility is raised that the development of the rule may have been diverted from its true course. These appeals are the first cases on the Hastings Bass rule in which the Commissioners of HM Revenue and Customs (the Revenue, so as to include their predecessors, the Commissioners of Inland Revenue) have been joined as parties in the proceedings. It is the Revenue that has taken on the task of challenging, if not the existence, at least the limits of the Hastings Bass rule. It is no coincidence that the judgment of the Court of Appeal in these two appeals (which were heard together in that court also) is the first fully considered judgment above first instance level, and the first to come on further appeal to the Supreme Court (Mettoy was not cited to the Court of Appeal in Stannard v Fisons Pension Trust Ltd [1991] Pen LR 225, discussed in para 34 below). Rescission of a voluntary disposition on the ground of mistake is, by contrast, a topic on which there is a good deal of authority, including a decision of the House of Lords, Ogilvie v Allen (1899) 15 TLR 294. But some of the authorities are quite old, and others are debatable. There has been much discussion of the distinction drawn by Millett J in Gibbon v Mitchell [1990] 1 WLR 1304, 1309, between a relevant mistake having to be as to the effect of the transaction itself and not merely as to its consequences or the advantages to be gained by entering into it. So here too review by the Supreme Court is appropriate. This court has therefore had to consider a large volume of case law, culminating in the judgment of Lloyd LJ in the Court of Appeal in these appeals: [2011] EWCA Civ 197, [2012] Ch 132. That judgment, described by Longmore LJ, para 227, as remarkable, and by Mummery LJ, para 230, as a very fine comprehensive and clarifying judgment, runs to 226 paragraphs. I share their admiration, and I agree with Lloyd LJs main conclusions as to the scope of the Hastings Bass rule, and the outcome of the appeals on that issue. But I will say at once that I take a different view of the disposal of the appeal in Pitt on the mistake issue. Before any detailed consideration of the case law it may be helpful to identify, in general terms, some of the principal topics in the appeals. It has often been said (for instance, by Norris J in Futter, para 21) that the rule in Hastings Bass is not founded in the law of mistake, and in his judgment Lloyd LJ dealt with them as almost completely separate topics. They do cover different areas, in that the Hastings Bass rule is restricted to decisions by trustees and other fiduciaries, and does not necessarily require the decision maker to be under a positive misapprehension: mere absence of thought may be sufficient. The courts wider jurisdiction to rescind a transaction on the ground of mistake is not limited to transactions entered into by fiduciaries, and does generally require there to have been something that can be identified as an operative mistake. The significance of fault in the error or inadvertence is a further point of distinction. Nevertheless there is a degree of overlap between the two principles in their practical application. In some of the first instance cases on the Hastings Bass rule judges have drawn attention, with evident surprise, to the absence of any alternative claim for relief by way of rectification or rescission on the ground of mistake. In some of the cases (such as Abacus Trust Co (Isle of Man) v Barr [2003] EWHC 114 (Ch), [2003] Ch 409, the facts of which are summarized at paras 36 and 37 below) rescission on the ground of mistake would seem to have been the natural remedy for the trustees to seek. There must be some suspicion that reliance on the Hastings Bass rule has come to be seen as something of a soft option, or at any rate as a safer option, at a time when it was supposed, wrongly, that the application of the rule did not require the granting of a remedy which was discretionary in the sense that it might be withheld because some equitable defence was established. The way in which the law seemed to be developing, especially in cases concerned with unsuccessful tax planning arrangements, led one legal scholar (Professor Charles Mitchell, Reining in the rule in In Re Hastings Bass, (2006) 122 LQR 35, 41 42) to ask: Why should a beneficiary be placed in a stronger position than the outright legal owner of property if he wishes to unwind a transaction to which he has given his consent, but which turns out to have unforeseen tax disadvantages? Professor Mitchell went on to comment, presciently: The courts will have to look elsewhere for the means of reining in the rule in Re Hastings Bass, most probably to the equitable bars to unwinding a transaction that would come into play if it were decisively recognised that the rule renders transactions voidable rather than void. This court now has the opportunity of confirming the Court of Appeals recognition of that essential point. THE HASTINGS BASS RULE The three strands of the problem appeals as In the Court of Appeal [2012] Ch 132, para 227 Longmore LJ described the . examples of that comparatively rare instance of the law taking a seriously wrong turn, of that wrong turn being not infrequently acted on over a 20 year period but this court being able to reverse that error and put the law back on the right course. If the law did take a seriously wrong turning it was because a number of first instance judges were persuaded that three separate strands of legal doctrine, all largely associated with practice in the Chancery Division, should be spun or plaited together so as to produce a new rule. The first strand of legal doctrine starts with the entirely familiar proposition that trustees, in the exercise of their fiduciary discretions, are under constraints which do not apply to adult individuals disposing of their own property. I made some uncontroversial observations about this in Scott v National Trust for Places of Historic Interest or Natural Beauty [1998] 2 All ER 705, 717: Certain points are clear beyond argument. Trustees must act in good faith, responsibly and reasonably. They must inform themselves, before making a decision, of matters which are relevant to the decision. These matters may not be limited to simple matters of fact but will, on occasion (indeed, quite often) include taking advice from appropriate experts, whether the experts are lawyers, accountants, actuaries, surveyors, scientists or whomsoever. It is, however for advisers to advise and for trustees to decide: trustees may not (except in so far as they are authorised to do so) delegate the exercise of their discretions, even to experts. This sometimes creates real difficulties, especially when lay trustees have to digest and assess expert advice on a highly technical matter (to take merely one instance, the disposal of actuarial surplus in a superannuation fund). The same principles apply, at least in a modified manner, to other persons acting in a fiduciary capacity. There are superficial similarities between what the law requires of trustees in their decision making and what it requires of decision makers in the field of public law. This was noted by the Court of Appeal in its judgment, delivered by Chadwick LJ, in Edge v Pensions Ombudsman [2000] Ch 602, 628 629. It was also noted by Lord Woolf MR in Equitable Life Assurance Society v Hyman [2002] 1 AC 408, para 20. The analogy cannot however be pressed too far. Indeed it was expressly disapproved by the Court of Appeal in these appeals (Lloyd LJ at para 77 and Mummery LJ at para 235). In Abacus Trust Co (Isle of Man) v Barr [2003] Ch 409, para 29 Lightman J identified three important differences as the discretionary nature of relief on judicial review, a different approach to nullity, and strict time limits. The second strand is that a voluntary disposition (typically a gift, outright or in settlement) may be set aside on the ground of mistake. As already noted, this branch of equitable jurisdiction is distinct from the Hastings Bass rule, but similar issues arise as to the nature and gravity of the relevant error or inadvertence, and in practice they sometimes overlap. The mistake jurisdiction was considered as a separate issue in paras 164 to 220 of Lloyd LJs judgment. He identified the correct test as derived in part from the judgment of Lindley LJ in Ogilvie v Littleboy (1897) 13 TLR 399, 400 (approved by the House of Lords as Ogilvie v Allen (1899) 15 TLR 294), a case which emerged from the shadows to be cited to the court after a century of obscurity. He also considered recent decisions including Gibbon v Mitchell [1990] 1 WLR 1304 and In re Griffiths decd [2008] EWHC 118 (Ch), [2009] Ch 162. The third strand of legal doctrine, and the most abstruse one, is concerned with the partial validity of an instrument which cannot be entirely valid because it infringes some general rule of law. It is an issue which arises, often under the rubric of severance, in many different areas of law. One example is contract law, especially in the context of illegal restraints on trade (see the judgment of Jonathan Sumption QC in Marshall v NM Financial Management Ltd [1995] 1 WLR 1461, upheld by the Court of Appeal [1997] 1 WLR 1527). Another example is bye laws held to be partly ultra vires (see the speech of Lord Bridge in Director of Public Prosecutions v Hutchinson [1990] 2 AC 783). In the field of trust law the most common invalidating factor, until the Perpetuities and Accumulations Act 1964, was the unreformed rule against perpetuities, or remoteness of vesting. This applied relentlessly both to dispositions of property made by settlors or testators of property at their free disposal, and to dispositions made in the exercise of special (that is, restricted) powers of appointment over settled property. Special powers of appointment might be exercisable either by individual donees (for instance, by a parent with a life interest in favour of children with interests in expectancy) or by the trustees as a body. But in either case the power could be exercised only within the limits, and for the purposes, marked out by the donor of the power. And in either case the interests appointed had to conform to the rule against perpetuities as it applied to lives in being at the time of the creation of the power (that is, the date of the original settlement, or the date of the testators death). These matters were once familiar (indeed, elementary) to almost all chancery practitioners. Law and practice at the chancery bar have moved on. The rule against perpetuities has lost its terrors since the Perpetuities and Accumulations Act 1964 (which was almost completely non retrospective) gradually came to apply to more and more trusts, followed by the Perpetuities and Accumulations Act 2009. Family trusts are now a shrinking enclave designated as private client work, and pensions trusts, burdened by increasingly complex regulatory statutes, are another enclave reserved for pensions specialists. But in order to investigate the origins of the disputed rule in In re Hastings Bass it is necessary to revisit, without much nostalgia, this area of trust law as it was about 50 years ago. There was a body of fairly arid case law, now almost entirely obsolete, about the validity of interests in settled property which were ulterior to but not dependent on antecedent interests which infringed the rule against perpetuities. In re Hubbards Will Trusts [1963] Ch 275 and In re Bucktons Settlement Trusts [1964] Ch 497 are examples from just before the enactment of the reforming statute. In re Abrahams Will Trusts [1969] 1 Ch 463 and In re Hastings Bass, decd [1975] Ch 42, discussed below, can be seen as a final chapter in that case law. There is one further background matter to be noted. Under traditional family settlements, when the modern type of discretionary settlement was still fairly rare, the most common dispositive power exercisable by trustees was the power of advancement. This is a power to accelerate the interest of a beneficiary interested in capital, exercisable with the consent of any beneficiary with a prior interest (typically a parent with a prior life interest). Such powers were so much common form that section 32 of the Trustee Act 1925 provided a default power, which could be excluded or (as often happened) extended by the trust instrument. The power was typically exercisable by a payment or transfer to or for the advancement or benefit of the beneficiary. In In re Pilkingtons Will Trusts [1964] AC 612 the House of Lords, differing from the judge on one point and from the Court of Appeal on another, held that a power in those terms could (in principle, and apart from the rule against perpetuities) be exercised for the benefit of a minor beneficiary (the testators nephews daughter, who was only two years old when the proceedings started in 1959) by a transfer of up to half of her expectant share, with her fathers consent, to the trustees of a new settlement under which she would attain a vested interest in capital at 30. This would lawfully avoid estate duty on her fathers death if he lived for a further five years. But the House of Lords also held that the new settlement must, for the purposes of the rule against perpetuities, be treated as if it were an appointment made under a special power conferred by the testators will. The trusts of the new settlement did not meet that requirement as the child was not a life in being at the testators death in 1935. But valid trusts to much the same effect could have been achieved (and may eventually have been put in place) by referring to the alternative contingency of survival until 21 years after her fathers death, as he was alive in 1935. Vestey, Abrahams and Hastings Bass In the Court of Appeal Lloyd LJ correctly identified the decision of the Court of Appeal in In re Vesteys Settlement [1951] Ch 209 and that of Cross J in In re Abrahams Will Trusts [1969] 1 Ch 463 as the most important precursors to the decision of the Court of Appeal in In re Hastings Bass [1975] Ch 25. Lloyd LJ analysed these three cases very thoroughly at paras 33 to 67 of his judgment. Because his analysis is so full and accurate I can deal with the cases more briefly, especially as to the facts. It is worth noting that although all three cases had an important tax element, in each case the trustees misunderstanding was not about tax law. It was about the general law: in the first case about the effect of section 31 of the Trustee Act 1925, and in the other two about the effect of the rule against perpetuities. In Vestey the trustees of a large settlement made by Lord Vestey and his brother Sir Edmund Vestey exercised their discretion over the allocation of income with the apparent intention of income being accumulated during the minorities of a number of beneficiaries. They set out to do this by a sort of framework resolution that income should belong to the minor beneficiaries in specified shares, followed by further half yearly resolutions to the effect that income was not required for the beneficiaries maintenance, and should therefore be accumulated under section 31 of the Trustee Act 1925. The difficulty was that the language of section 31 did not really fit such a situation. At first instance Harman J held that the resolutions were ineffective. That result would have avoided surtax but left the income in limbo (Evershed MRs suggestion in the Court of Appeal that the income would have been held on a resulting trust for the settlors seems, with respect, very doubtful). But the minor beneficiaries appealed, and the Court of Appeal gave effect to the framework resolution, treating the references to accumulation under section 31 as peripheral. Evershed MR stated ([1951] Ch 209, 220 to 221): I do not think it can or ought to be said that if, as I hold, the trustees wrongly thought that section 31 would operate, then a result is produced substantially or essentially different from that which was intended. The result was that for the period covered by the trustees resolutions, the minor beneficiaries got their income, but the Revenue got their surtax on that income. Abrahams and Hastings Bass were both cases about plans to save estate duty by terminating a life interest and passing on settled property to the next generation. The plans (carried out in 1957 and 1958 respectively) were on the same general lines as that in Pilkington, the first instance decision in which ([1959] Ch 699, Danckwerts J) had provided an encouraging precedent (the Revenue were joined in the proceedings and given leave to appeal in 1960). The Revenue were also parties to the Abrahams and Hastings Bass cases, and in each case (ironically, in view of later developments, as Norris J pointed out) it was the Revenue which argued for the complete invalidation of the resettlement, partly through the direct operation of the rule against perpetuities, and partly (as an argument against severance) because the effect of the operation of the rule is wholly to alter the character of the settlement, as Cross J put it in Abrahams at p 485. Cross J rejected an argument approximating an advancement by way of resettlement to the exercise of a power of appointment. Although they were treated in the same way for perpetuity purposes, in his view the similarity ended there (p. 485 D E): The interests given to separate objects of an ordinary special power are separate interests, but all the interests created in Caroles fund were intended as part and parcel of a single benefit to her. Cross J held, therefore, that there was no valid exercise of the power of advancement. In Hastings Bass the Court of Appeal, in a single judgment delivered by Buckley LJ, took a different view of a similar duty saving transaction. The true ratio of the decision has been much debated, both in forensic argument and by legal scholars. It has been considered twice by Lloyd LJ, first in Sieff v Fox [2005] EWHC 1312 (Ch), [2005] 1 WLR 3811 paras 43 and 44 (his last first instance case before his promotion to the Court of Appeal) and again, at much greater length, in his judgment in this case (paras 46 to 67). It is perhaps simplest to start with what Hastings Bass did not decide. It was not about mistake. Although one case on mistake (Wollaston v King (1869) LR 8 Eq 165) was cited, it was not referred to in the judgment. It would not have been enough for the Revenue to establish that the exercise of the trustees power might have been voidable at the instance of a beneficiary. The Revenue could succeed only by establishing that there had been no valid advancement at all. Nor did the decision turn on any inquiry into what was actually in the minds of the trustees in exercising the power of advancement. There seems to have been no evidence of this, and in Buckley LJs discussion at pp 39 41 (extensively quoted by Lloyd LJ at paras 53 56) the recurrent theme is what the trustees, as reasonable trustees, should or would have considered or intended. The third negative point to make is that Hastings Bass did not overrule Abrahams. It was distinguished on the basis that in Abrahams the attenuated residue of the sub settlement not struck down by the rule against perpetuities may not have been for the benefit of the beneficiary in question. But Buckley LJ did differ from Cross Js view that the benefit conferred by an advance by way of resettlement was of a monolithic character, preferring the view that it was a bundle of benefits of different characters. If and so far as it is an issue of severability, it is obviously easier to sever part of a bundle than part of a monolith. Buckley LJs own statement of the principle of the decision in Hastings Bass seems to be the passage at p 41 which has often been cited in later cases: To sum up the preceding observations, in our judgment, where by the terms of a trust (as under section 32) a trustee is given a discretion as to some matter under which he acts in good faith, the court should not interfere with his action notwithstanding that it does not have the full effect which he intended, unless (1) what he has achieved is unauthorised by the power conferred upon him, or (2) it is clear that he would not have acted as he did (a) had he not taken into account considerations which he should not have taken into account, or (b) had he not failed to take into account considerations which he ought to have taken into account. Lloyd LJ did not accept that as the true ratio. He thought that the Court of Appeal had already decided the case on the ground that the advancement, so far as not struck down by the rule against perpetuities, must stand unless it could not, in that attenuated form, reasonably be regarded as beneficial to the advancee. That is an objective test which does not call for an inquiry into the actual states of mind of the trustees. Lloyd LJ expanded this line of thought in para 66: If the problem to be resolved is what is the effect on an operation such as an advancement of the failure of some of the intended provisions, because of external factors such as perpetuity, it is not useful to ask what the trustees would have thought and done if they had known about the problem. The answer to that question is almost certainly that they would have done something different, which would not have run into the perpetuity or other difficulty. It is for that reason that the test has to be objective, by reference to whether that which was done, with all its defects and consequent limitations, is capable of being regarded as beneficial to the intended object, or not. If it is so capable, then it satisfies the requirement of the power that it should be for that persons benefit. Otherwise it does not satisfy that requirement. In the latter case it would follow that it is outside the scope of the power, it is not an exercise of the power at all, and it cannot take effect under that power. On this analysis, limb (1) of Buckley LJs statement of principle covers the whole ground, and limb (2) adds nothing. I respectfully agree with Lloyd LJs criticism of the statement of principle. I think it is also open to criticism for the generality of its reference to unintended consequences (notwithstanding that it does not have the full effect which he intended). That is a far reaching extrapolation from one case about section 31 of the Trustee Act 1925 and two cases about the rule against perpetuities. It set ajar a door that was pushed wide open in Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 and other later cases. Mettoy In Mettoy Warner J applied the supposed new principle in the context of an occupational pension scheme, and in circumstances where the trustees exercise of a discretionary power was within the scope of that power. There was no invalidating factor, such as the rule against perpetuities, applicable under the general law. In doing so Warner J dismissed two significant arguments for limiting the scope of the new principle. The employer, Mettoy Co Plc, and the trustees of its pension scheme had in 1983 executed a deed to replace a 1980 deed (and some supplementary deeds) which were ineffective because of an error about the trusteeship. The rules scheduled to the 1980 deed included rule 13, providing for the winding up of the scheme in certain circumstances, the priority of claims in the winding up and the disposal of any ultimate surplus. This rule differed from an earlier winding up rule in several respects. Most materially, the discretion to use any ultimate surplus in augmenting benefits was to be exercisable by the employer (instead of by the trustees, as provided by the earlier rule). Moreover, in 1983 Mettoys financial position was precarious (as a result of an ill advised diversification from die cast model vehicles into personal computers) so that winding up of the scheme was much more than a remote possibility. In the event the scheme had to be wound up in 1984. The trustees issued an originating summons raising a number of questions, the most important being (in effect) whether the 1983 deed was wholly invalid, or valid except for rule 13, or valid except that the power of augmentation remained exercisable by the trustees. These questions arose because the trustees had admittedly not considered, or been advised about, the significance of rule 13. In response to another question raised by the originating summons, Warner J held that the power of augmentation was, even when exercisable by the employer, a fiduciary power. On that basis it was not clear that the trustees, if they had fully considered the matter, would have objected to the change effected by rule 13 ([1990] 1WLR 1587, 1628A 1630A). But by then Warner J had upheld (in a passage from pp1621G to 1626A) the existence of a principle which may be labelled the rule in Hastings Bass. He took Buckley LJs statement of principle in that case (set out at para 24 above) and reformulated it in positive terms, and so far as relevant to the facts of the case, as follows (p 1621H): where a trustee acts under a discretion given to him by the terms of the trust, the court will interfere with his action if it is clear that he would not have acted as he did had he not failed to take into account considerations which he ought to have taken into account. Warner J rejected the submissions of Mr Edward Nugee QC, recorded at pp 1622G to 1623G, that the principle, although existent, was of very narrow scope, and that the cases of Vestey, Abrahams and Hastings Bass (together with Pilkington, where there was a proposal for a resettlement rather than a completed transaction): . were about the consequences of what [Mr Nugee] referred to as an excessive execution of a power, ie the purported exercise of a power in a way that the law rendered partially ineffective. Warner J dismissed this argument at p1624B C: If, as I believe, the reason for the application of the principle is the failure by the trustees to take into account considerations that they ought to have taken into account, it cannot matter whether that failure is due to their having overlooked (or to their legal advisers having overlooked) some relevant rule of law or limit on their discretion, or is due to some other cause. Warner J also dismissed what he called Mr Nugees all or nothing argument (pp 1624H 1625A). In some cases the court would have to declare void the whole of some purported exercise of discretion by trustees. But in other cases (for instance where the trustees would have decided, had they thought about it properly, to omit some particular provision from a deed) the appropriate course would be to declare that provision alone to be void. At p 1626D Warner J referred to the all important third question: what would the trustees have done if they had considered the matters that they failed to consider? His meticulous review of the oral and documentary evidence, including the cross examination of Mr Lillyman (who was at all material times closely involved as the employers company secretary and a director of the corporate trustee) shows that he was concerned to establish, so far as he could, what these particular trustees (and not some hypothetical reasonable trustees) would have done. His approach was subjective, not objective. I respectfully agree with Lloyd LJs view that the basis on which Mettoy was decided cannot be found in the reasoning which led to the decision in Hastings Bass. It can claim to be an application of Buckley LJs summary statement of principle, but only if that statement is taken out of context and in isolation from the earlier part of the judgment. If the principle applied by Warner J merits a name at all, it should be called the rule in Mettoy. But the rule as formulated by Warner J has given rise to many difficulties, both in principle and in practice. From Mettoy to Sieff Mettoy was not much considered by the court during the 1990s. It was cited but not referred to in the judgment of the Court of Appeal in Edge v Pensions Ombudsman [2000] Ch 602. That decision, on an appeal by the Pensions Ombudsman from the judgment of Sir Richard Scott V C [1998] Ch 512, was largely concerned with the jurisdiction of the Pensions Ombudsman under Part X of the Pension Schemes Act 1993. The general tenor of the Court of Appeals judgment is that neither the Ombudsman nor the court has power to intervene in decisions made by trustees unless they have acted in breach of duty. That can be seen as putting down a marker that Lloyd LJ has since recognised. In Stannard v Fisons Pension Trusts Ltd [1991] Pen LR 225, in which Hastings Bass but not Mettoy was cited, the Court of Appeal modified Buckley LJs formulation, without any full discussion of the point, by putting the test in terms of what the trustees might, rather than would, have done if fully informed. The facts were that trustees had taken a decision about transfer values on the basis of an out of date valuation of the pension fund. The Court of Appeals modification of the test seems questionable since the legal significance of the error must have depended on the scale of the change in market value rather than on the precise nature of the trustees hypothetical second thoughts. It was not until about the year 2000 that Hastings Bass and Mettoy began to be called in aid in cases where tax planning arrangements involving trusts had gone wrong. The first case seems to have been Green v Cobham, decided by Jonathan Parker J in January 2000 but reported at [2002] STC 820, followed by Abacus Trust Co (Isle of Man) v National Society for the Prevention of Cruelty to Children [2001] STC 1344 (Patten J) and Breadner v Granville Grossman [2001] Ch 523 (Park J). Breadner was an unsuccessful attempt to extend the principle so as to circumvent a missed time limit for the exercise of a power of appointment. Park J observed at para 61: There must surely be some limits. It cannot be right that whenever trustees do something which they later regret and think that they ought not to have done, they can say that they never did it in the first place. The most important decisions, prior to the present appeals, are the decisions of Lightman J in Abacus Trust Co (Isle of Man) v Barr [2003] Ch 409 and Lloyd LJ in Sieff v Fox [2005] 1 WLR 3811. In the former case Mr Barr had participated in a management buy out of an engineering company and in 1992 he had settled his shares in the buy out vehicle, held through an Isle of Man holding company, in a settlement of which Abacus Trust Co (Isle of Man) (Abacus) was trustee. Abacus was administered by the Isle of Man firm of Coopers & Lybrand (C&L (IoM)). C&L (IoM) had close links with the English firm of Coopers & Lybrand, which advised on the buy out. Mr Ward Thompson of the English firm was Mr Barrs main contact. Under the settlement Mr Barr had a life interest, but Abacus as trustee had an overriding power of appointment in favour of a wide class of beneficiaries. Very soon after the creation of the settlement Mr Barr told Mr Ward Thompson that he wished 40% of the trust fund to be appointed on discretionary trusts in favour of his sons and their families, to the exclusion of himself and any wife of his. Through some misunderstanding this was conveyed to C&L (IoM) as a wish for 60% of the fund to be appointed, and on 22 April 1992 an appointment in that form was made. The mistake was discovered in August 1992 but nothing was done to try to remedy it until 2002. In the meantime, in 1994 the buy out vehicle was floated on the London Stock Exchange and the holding company controlled by Abacus embarked on a programme of sales of its shares. The judgment of Lightman J is impressively brief and incisive. He pointed out that Abacus was not seeking either rectification or rescission for mistake, and added in relation to the Hastings Bass rule (para 13): But in considering the ambit of the rule it is necessary to bear in mind that it is only one of the protections afforded to beneficiaries in respect of the due administration of the trust by the trustees. It is also important to have in mind that equity does not afford a trustee or a beneficiary a free pass to rescind a decision which subsequently proves unpalatable or unfortunate and substitute another. Relief is only available if the necessary conditions for its grant are satisfied. He referred to the authorities already discussed and observed that he did not need to resolve the issue posed by Stannard, since (para 20) clearly the trustee would not have appointed 60% of the trust fund if it had known of the settlors true wishes. He then addressed four issues: (1) whether there had to be a fundamental mistake; (2) whether the rule applied if there was any relevant mistake or ignorance on the part of the trustee, regardless of how it arose (and in particular, regardless of any breach of duty on the part of the trustee); (3) following from the last point, whether the rule applied on the facts of the case before him; and (4) whether, if the rule applied, the appointment was void or voidable. On the first issue Lightman J decided, correctly in my view, that a fundamental mistake was not necessary. A fundamental, or at least serious mistake may be necessary for rescission on the ground of mistake (that is relevant to the second ground of appeal in Pitt), but for the rule which Abacus was invoking (para 21): the rule does not require that the relevant consideration unconsidered by the trustee should make a fundamental difference between the facts as perceived by the trustee and the facts as they should have been perceived. All that is required in this regard is that the unconsidered relevant considerations would or might have affected the trustees decision, and in a case such as the present that the trustee would or might have made a different appointment or no appointment at all. But as his decision on the second point shows, it must be sufficiently serious as to amount to a breach of duty. On the second issue, Lightman J held that a breach of duty on the part of the trustee is essential to the application of the rule (para 23): What has to be established is that the trustee in making his decision has, in the language of Warner J in Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587, 1625, failed to consider what he was under a duty to consider. If the trustee has in accordance with his duty identified the relevant considerations and used all proper care and diligence in obtaining the relevant information and advice relating to those considerations, the trustee can be in no breach of duty and its decision cannot be impugned merely because in fact that information turns out to be partial or incorrect. That is in my view a correct statement of the law, and an important step towards correcting the tendency of some of the earlier first instance decisions. If in exercising a fiduciary power trustees have been given, and have acted on, information or advice from an apparently trustworthy source, and what the trustees purport to do is within the scope of their power, the only direct remedy available (either to the trustees themselves, or to a disadvantaged beneficiary) must be based on mistake (there may be an indirect remedy in the form of a claim against one or more advisers for damages for breach of professional duties of care). This serves to emphasise that the so called rule in Hastings Bass was not in play in that case, or in Abrahams. In those two cases the trustees were not at fault in failing to foresee the House of Lords decision in Pilkington several years later. But they purported to exercise their power of advancement in a way that was beyond the scope of that power, since it was contrary to the general law (that is the rule against perpetuities as clarified in Pilkington). The issue (resolved differently in Abrahams and Hastings Bass) was whether the parts of the resettlement not void for perpetuity were sufficient to amount to a proper exercise of the power of advancement. In Mettoy and Barr, by contrast, it was never in doubt that the relevant deed fell within the scope of the trustees power. This point is clearly made in paras 92 and 93 of Lloyd LJs judgment in the Court of Appeal. On the third issue Lightman J held that Abacus was in breach of duty, mainly because it had to take responsibility for Mr Ward Thompson, who (para 27) has declined to give evidence and answer the case made or suggest a different scenario. This part of the judgment turns on the particular facts of the case, but they are typical of many such cases, and I shall return to them in discussing the difficulties that still beset this area of the law. On the fourth issue Lightman J held that in cases where the rule applies (as opposed to cases of equitable non est factum such as Turner v Turner [1984] Ch 100) it makes the trustees disposition voidable, not void. The Court of Appeal agreed with his analysis, and so do I. The rule, properly understood, depends on breach of duty in the performance of something that is within the scope of the trustees powers, not in the trustees doing something that they had no power to do at all. Beneficiaries may lose their right to complain of a breach of trust by complicity, by laches or acquiescence or in other ways. Lightman J adjourned the case, expressing the hope (para 34) that a compromise would be possible. The absence of any further reported decision suggests that his hope was realised. In Sieff v Fox [2005] 1 WLR 3811 Lloyd LJ (as he had become by the time he handed down his lengthy reserved judgment) fully considered all the authorities mentioned above, and other authorities on mistake. I can take his judgment fairly briefly because he had occasion to reconsider it, and on one important point to depart from it, in his judgment in the Court of Appeal in these appeals. The case related to valuable land and chattels comprised in the Bedford settled estates, and the facts as to the trusts, and their tax implications, are very complicated. It is sufficient to note two points. First, the critical appointment (made in 2001 by the trustees in favour of Lord Howland, and with a view to a resettlement by him) required the consent of Lord Howland himself. In deciding whether or not to give consent Lord Howland was not acting in a fiduciary capacity. His consent (given in ignorance of some of the implications, including adverse tax consequences) was challenged, successfully, on the ground of mistake (see paras 115 and 119 (vii) of the judgment of Lloyd LJ). In his discussion of mistake, Lloyd LJ relied (paras 98 to 101) on Ogilvie v Littleboy (1897) 13 TLR 399, upheld on appeal as Ogilvie v Allen (1899) 15 TLR 294. The trustees exercise of their power of appointment was challenged, also successfully, under the Hastings Bass rule (see para 114, and compare para 119 (vi)). The second point to note is that Lloyd LJ was inclined to differ from Lightman J as to the need for the vitiating element in a fiduciary decision to amount to a breach of trust. Lloyd LJ referred to the trustees in Abrahams not being at fault in failing to foresee that the first instance decision in Pilkington would be reversed on an appeal made out of time. But Abrahams was a case in which the purported exercise of the trustees power was outside its proper scope, because it infringed the rule against perpetuities. This is the point on which Lloyd LJ has modified the provisional view which he expressed in Sieff v Fox. Futter v Futter: The facts and the first instance decision The appeal in Futter is concerned with incorrect advice given by solicitors as to the effect of provisions, primarily in section 87 of the Taxation of Chargeable Gains Act 1992 (TCGA), charging capital gains tax in respect of gains realised by non resident trustees. There were two settlements, the No 3 settlement and the No 5 settlement, made by Mr Mark Futter in 1985. Initially both settlements had non resident trustees, but in 2004 Mr Futter and Mr Cutbill, both resident in the United Kingdom, were appointed as trustees of the two settlements. Mr Cutbill was a partner in the London solicitors which gave the tax advice. At that stage both settlements had stockpiled gains that is, gains realised while the trust was not resident, and not yet distributed to the beneficiaries or brought in to charge for capital gains tax purposes. On the advice of the solicitors, the new, resident trustees on 31 March 2008 distributed the whole capital of the No 3 settlement to Mr Futter, in exercise of a power of enlargement, and on 3 April 2008 distributed 36,000 from the No 5 settlement to Mr Futters three children in equal shares, in exercise of a power of advancement. Each of these transactions was squarely within the scope of the relevant power. Mr Futter and Mr Cutbill understood (correctly) that the stockpiled gains would in consequence be attributed to Mr Futter and his children as if they were gains realised by those beneficiaries themselves. They also believed (incorrectly) that these attributed gains would be absorbed by allowable losses which they had realised so that no eventual tax liability would arise. This overlooked the effect of section 2(4) of TCGA as amended (the relevant amendment, for those interested in the fine detail, was that made by Schedule 21, para 2 of the Finance Act 1998, and not the further amendment made by Schedule 2, para 24 of the Finance Act 2008, which applied only from 5 April 2008). The result was a large capital gains tax liability for Mr Futter and a modest one for his children. Mr Futter and Mr Cutbill applied, as trustees of the two settlements, to have the deed of enlargement and the deeds of advancement declared void. The first four defendants, the beneficiaries, did not appear. The fifth defendant, the Revenue, resisted the application. Norris J began his judgment in spirited fashion, as already noted (para 3 above). However he went on to state that it was not an occasion for a first instance judge to reconsider a developed rule. He took the judgment of Lloyd LJ in Sieff v Fox as the leading authority on the rule, as had Sir Andrew Park in Smithson v Hamilton [2008] 1 WLR 1453, para 52, and as had Mr Robert Englehart QC in Pitt v Holt [2010] 1 WLR 1199, para 18. The Revenues submissions were similar to those advanced in Pitt (para 57 below), apart from the receivership point. As it happens the first instance judgment in Pitt was given on the first day of the first instance hearing in Futter, so that there was no real opportunity for revision of the Revenues case. As recorded in the judgment of Norris J the Revenue had three main lines of argument. The first was that the decision of the trustees was not in any meaningful sense different from what they intended (apart from the tax consequences). This argument echoed the distinction drawn by Millett J in Gibbon v Mitchell [1990] 1 WLR 1304, 1309 1310, between effect and consequences. Norris J rejected this argument on the ground that mistake was a different ground for relief, and that under the Hastings Bass rule tax consequences are rightly regarded as something that trustees must take into account in exercising their discretions. The Revenues second line of argument focused on the significance of the trustees error. It was to some extent a variation on the first argument, and it was rejected on similar grounds. The Revenues third submission (not pressed) was that so far from considering capital gains tax, the trustees had it in the forefront of their minds: the problem was that the advice was wrong (para 28). But wrong advice on tax consequences could, the judge said, lead to a perfectly orthodox application of the rule. Norris J held that the deeds were void, not voidable. He referred briefly (para 32) to the judgment of Lightman J in Barr, but noted that his reasoning (based on the trustees being at fault) was not accepted by Lloyd LJ in Sieff v Fox. Nevertheless Norris J considered (para 33) that the rigours of the void analysis could be mitigated by the application of equitable principles. Pitt v Holt: The facts and the first instance decision The facts relevant to the Pitt appeal are set out at length in the judgment of Lloyd LJ at paras 147 to 159, to which reference may be made for further detail. The claim was made by the personal representatives of Mr Derek Pitt, who died in 2007 aged 74. In 1990 he had suffered very serious head injuries in a road traffic accident, resulting in his mental incapacity. His wife, Mrs Patricia Pitt, was appointed as his receiver under the Mental Health Act 1983, and on his death she became one of his personal representatives, and the only beneficiary interested in his estate. Mr Pitts claim for damages for his injuries was compromised by a structured settlement, approved by the court, in the sum of 1.2m. Mrs Pitts solicitors sought advice from Frenkel Topping, a firm of financial advisers said to have specialist experience of structured settlements. They advised that the damages should be settled in a discretionary settlement, and this was done, with the authority of the Court of Protection, in 1994. The trust was referred to as the Derek Pitt Special Needs Trust (the SNT). Frenkel Topping gave their advice in a written report to Mrs Pitt (as receiver) which was made available to the Official Solicitor, who represented her husband in the application to the Court of Protection. The report referred to various advantages which the SNT was expected to secure, and it mentioned income tax and capital gains tax in its illustrative forecasts. But the report made no reference whatsoever to inheritance tax. The SNT could have been established without any immediate inheritance tax liability if (i) it had been an interest in possession trust or (ii) it had been a discretionary trust complying with section 89 of the Inheritance Tax Act 1984. In order to comply with section 89 its terms should have provided that at least half of the settled property applied during Mr Pitts lifetime was applied for his benefit. But the SNT as drafted and executed contained no such restriction. The consequence was an immediate liability to inheritance tax of the order of 100,000, with the prospect of a further tax charge on the tenth anniversary in 2004. The deputy judge (Mr Robert Englehart QC) observed that by 2010 the total tax, together with interest and penalties (if exacted) must have amounted to between 200,000 and 300,000. Mrs Pitt and her advisers became aware of the inheritance tax liabilities in 2003. In 2006 Mr Pitt (by a litigation friend) and the trustees of the SNT commenced proceedings against Frenkel Topping claiming damages for professional negligence. Mr Pitt died in 2007. After taking further advice his personal representatives (who were also two of the trustees of the SNT) commenced proceedings seeking to have the SNT set aside either under the Hastings Bass rule, or on the ground of mistake. The first defendant was the remaining trustee of the SNT (who took no part in the proceedings) and the second defendant was the Revenue (which actively opposed the application). Evidence was given in writing and there was no cross examination. In his judgment the deputy judge discussed the principal authorities on the Hastings Bass rule and observed (para 22) that three matters were not in dispute. First, it was agreed that the rule could apply without the need to identify a breach of duty on the part of the trustees or their advisers (so following Sieff v Fox rather than Barr). Second, it was unnecessary on the facts of the case to decide whether the application of the rule rendered a transaction void or voidable. Third, the rule would apply only if it was established that Mrs Pitt, if properly advised, would not have set up the SNT (rather than merely might not have done so). The principal arguments for the Revenue were that the rule did not in any case apply to a receiver (as opposed to a formally constituted trustee); that the rule applied only to a limited class of cases where the immediate purpose of the act in question was not achieved; and that tax consequences were never a sufficient basis for the application of the rule. The deputy judge rejected these submissions, holding that a receiver, as a fiduciary, was in essentially the same position as a trustee, and that the weight of the first instance authorities supported a wider version of the rule. He set aside the SNT on that ground. He indicated that he was not satisfied that there was any real mistake, as opposed to a failure to think about tax at all. Even if there was a mistake of any sort, it was only a mistake as to the consequences of the transaction, rather than its effect. Lloyd LJs judgment on the Hastings Bass rule I have already indicated my general agreement with Lloyd LJs judgment on the Hastings Bass issue. Paragraphs 1 to 28 contain an introduction and a summary of the facts of the two appeals. Paragraphs 29 to 67 consider Vestey, Abrahams and Hastings Bass. They come to the conclusion, with which I fully agree, that Buckley LJs statement of the supposed rule (para 24 above) was wider than the true principle of the actual decision in Hastings Bass. Paragraphs 68 to 91 consider more recent authorities, including Mettoy and Barr. All this is in a sense preliminary. Lloyd LJs essential reasoning and conclusions are at paragraphs 92 to 131. He then applied what he saw as the correct principle to the facts of Futter (paras 132 to 145) and Pitt (paras 146 to 163). He then dealt with the issue of mistake, raised by the respondents notice in Pitt (paras 164 to 223). The outcome was that both appeals were allowed (paras 224 to 226). Longmore LJ and Mummery LJ both gave short concurring judgments expressing full agreement. Mummery LJ added a clear summary of five salient points (paras 233 to 238). In the core of his judgment Lloyd LJ correctly spelled out the very important distinction between an error by trustees in going beyond the scope of a power (for which I shall use the traditional term excessive execution) and an error in failing to give proper consideration to relevant matters in making a decision which is within the scope of the relevant power (which I shall term inadequate deliberation). Hastings Bass and Mettoy were, as he rightly observed, cases in quite different categories. The former was a case of excessive execution and the latter might have been, but in the end was not, a case of inadequate deliberation. Lloyd LJ therefore withdrew his doubts about the conclusions that Lightman J had reached in Barr. Lloyd LJ then addressed the difficult question of how a fraudulent appointment (that is, an appointment ostensibly within the scope of a power, but made for an improper purpose) is to be fitted into the classification. The exercise of an equitable power may be fraudulent in this sense whether or not the person exercising it is a fiduciary. A well known example of trustees exercising a power for an improper purpose is provided by In Re Pauling [1964] Ch 303, in which a power ostensibly exercisable for the benefit of young adult beneficiaries was used to distribute trust capital to be frittered away on their improvident parents living expenses. There is Court of Appeal authority that a fraudulent appointment is void rather than voidable: Cloutte v Storey [1911] 1 Ch 18. In that case the appointee under an improper appointment had charged his equitable interest as security for a loan (and in doing so made two false statutory declarations as to the genuineness of the appointment). It was held that the lender had no security, even though it had no notice of the equitable fraud. It is an authority which has bedevilled discussion of the true nature of the Hastings Bass rule. Lightman J found the judgment of Farwell LJ problematic (Barr, para 31) and Lloyd LJ shared his reservations (para 98). So do I. It is hard to know what to make of Farwell LJs observations [1911] 1 Ch 18, 31: If an appointment is void at law, no title at law can be founded on it; but this is not so in equity: the mere fact that the appointment is void does not prevent a Court of Equity from having regard to it: eg, an appointment under a limited power to a stranger is void, but equity may cause effect to be given to it by means of the doctrine of election. The decision in Cloutte v Storey may have to be revisited one day. For present purposes it is sufficient to note that a fraudulent appointment (that is, one shown to have been made for a positively improper purpose) may need a separate pigeon hole somewhere between the categories of excessive execution and inadequate deliberation. In paragraphs 102 to 118, Lloyd LJ considered the duties of trustees in exercising their discretion, and in particular the relevance of tax considerations. He referred to some well known authorities including In re Badens Deed Trusts [1971] AC 424. That case was directly concerned with the correct test for certainty of objects of a discretionary trust (or trust power) but the speech of Lord Wilberforce contains, at pp 448 457, a general discussion of fiduciary discretions which has been very influential in the development of the law. This includes a passage at pp 456 457 as to the Courts intervention if trustees fail to exercise a trust power (that is, a discretion which it is their duty to exercise in some way). After referring to Lord Upjohns opinion Lord Wilberforce said: I would venture to amplify this by saying that the court, if called upon to execute the trust power, will do so in the manner best calculated to give effect to the settlors or testators intentions. It may do so by appointing new trustees, or by authorising or directing representative persons of the classes of beneficiaries to prepare a scheme of distribution, or even, should the proper basis of distribution appear by itself directing the trustees so to distribute. Lloyd LJ did not refer to that particular passage, but Warner J had done so in Mettoy [1990] 1 WLR 1587, 1617 1618, since in that case a decision as to the exercise of the power to augment benefits would have to be taken by someone. The passage serves as a reminder that where trustees have been in breach of duty by exercising a discretion with inadequate deliberation, setting aside their decision may not be the only course open to the court. In discussing what trustees should take into account, Lloyd LJ observed that the older cases tended to focus, not on what should be taken into account, but on what should not be taken into account. He instanced two cases. One was Klug v Klug [1918] 2 Ch 67, where one of the trustees strongly disapproved of her daughters choice of husband, and for that reason refused to concur with the Public Trustee in exercising a power of advancement in her favour. The court overrode her objection because she had not considered whether or not it would be for her daughters welfare that the advance should be made. She had therefore made no proper exercise of her discretion. The other case was In re Lofthouse (An Infant) (1885) 29 Ch D 921, in which income of a fund was available for the maintenance of a five year old girl whose mother had died very shortly after her birth. Her father had remarried and had three children by his second marriage. Bacon V C and the trustees (of the will of the girls maternal grandmother) evidently took very different views of how the father would spend the income if it was all paid to him for his eldest childs maintenance. The case was resolved by agreement in the Court of Appeal. The old cases as to the maintenance of children are rather exceptional, especially where the position was complicated by the child in question being a ward of court, as in In re Hodges (1878) 7 Ch D 754. Some judicial pronouncements in these cases should not be taken out of context. At para 115 Lloyd LJ reaffirmed the view that he had expressed in Sieff v Fox, para 86, that fiscal consequences may be relevant considerations which the trustees ought to take into account. I agree. In the private client world trusts are mostly established by and for wealthy families for whom taxes (whether on capital, capital gains or income) are a constant preoccupation. It might be said, especially by those who still regard family trusts as potentially beneficial to society as a whole, that the greater danger is not of trustees thinking too little about tax, but of tax and tax avoidance driving out consideration of other relevant matters. That is particularly true of offshore trusts. They are usually run by corporate trustees whose officers and staff (especially if they change with any frequency) may know relatively little about the settlor, and even less about the settlors family. The settlors wishes are always a material consideration in the exercise of fiduciary discretions. But if they were to displace all independent judgment on the part of the trustees themselves (or in the case of a corporate trustee, by its responsible officers and staff) the decision making process would be open to serious question. The Barr case (2003) Ch 409 illustrates the potential difficulties of unquestioning acceptance of the settlors supposed wishes. It is interesting, in this context, to compare the facts of some of the offshore cases with those of Turner v Turner [1984] Ch 100. That was a case in which a farmer made a discretionary settlement which he did not understand, and appointed as trustees family friends who never realised that they had any responsibility at all except to do as the settlor asked. They thought that it would be intruding into the settlors affairs if they were to read the documents that they were asked to sign (see at pp 106 108). Anyone familiar with the duties of trustees may find this hard to contemplate (as Mervyn Davies J did, at p 109). But it may be that some offshore trustees come close to seeing their essential duty as unquestioning obedience to the settlors wishes. The Barr case also illustrates another practical difficulty in the application of the Hastings Bass rule as it has developed. Lightman J was in my view right to decide that when the vitiating error is inadequate deliberation on relevant matters (rather than mistake) the inadequacy must be sufficiently serious as to amount to a breach of duty; and Lloyd LJ was right to change the contrary view which he had expressed in Sieff v Fox. It would set the bar too high (or too low, depending on the spectators point of view) to apply the Hastings Bass rule whenever trustees fall short of the highest standards of mature deliberation and judgment. Where, as in Barr, the trustee is a body corporate acting as a sort of in house facility provided by a firm of professional advisers, it may be hard to decide whether the separate juristic personality of the trustee insulates it from responsibility for the errors of individual professionals within the firm. A rather similar problem arose on the facts of Futter. It is a striking feature of the development of the Hastings Bass rule that it has led to trustees asserting and relying on their own failings, or those of their advisers, in seeking the assistance of the court. This was pointed out in no uncertain terms by Norris J in his first instance judgment in Futter, quoted in para 3 above. There may be cases in which there is for practical purposes no other suitable person to bring the matter before the court, but I agree with Lloyd LJs observation (para 130) that in general it would be inappropriate for trustees to take the initiative in commencing proceedings of this nature. They should not regard them as uncontroversial proceedings in which they can confidently expect to recover their costs out of the trust fund. Lloyd LJ stated the correct principle, as he saw it, at para 127: It seems to me that the principled and correct approach to these cases is, first, that the trustees act is not void, but that it may be voidable. It will be voidable if, and only if, it can be shown to have been done in breach of fiduciary duty on the part of the trustees. If it is voidable, then it may be capable of being set aside at the suit of a beneficiary, but this would be subject to equitable defences and to the courts discretion. The trustees duty to take relevant matters into account is a fiduciary duty, so an act done as a result of a breach of that duty is voidable. Fiscal considerations will often be among the relevant matters which ought to be taken into account. However, if the trustees seek advice (in general or in specific terms) from apparently competent advisers as to the implications of the course they are taking, and follow the advice so obtained, then, in the absence of any other basis for a challenge, I would hold that the trustees are not in breach of their fiduciary duty for failure to have regard to relevant matters if the failure occurs because it turns out that the advice given to them was materially wrong. Accordingly, in such a case I would not regard the trustees act, done in reliance on that advice, as being vitiated by the error and therefore voidable. The requirement for breach of duty In this court Mr Robert Ham QC undertook the main burden of the argument for the appellants on the Hastings Bass rule. Mr Christopher Nugee QC adopted Mr Hams submissions, and added some of his own, but concentrated his argument on the issue of mistake. Mr Hams submissions centred on whether the courts jurisdiction under the Hastings Bass rule is exercisable only if there is a breach of fiduciary duty on the part of the trustees (or other relevant fiduciary). He argued that this is a novel requirement which leads to arbitrary and unfair distinctions, especially in cases where incorrect advice on tax has been given by professional advisers who may or may not themselves be trustees. Mr Ham also had subsidiary but important arguments about the attribution to trustees of fault on the part of their advisers, and about the identification of relevant considerations for the purposes of the rule. Mr Ham contended that the supposed need for establishing a breach of fiduciary duty, before the Hastings Bass rule can come into play, was a novel requirement introduced in 2003 by Lightman J in his judgment in Barr. Reference to paras 16 to 20 of his judgment shows that Lightman J was relying on a number of earlier authorities, including the decision of the Court of Appeal in Edge [2000] Ch 602, 627 628, and the decision of Warner J in Mettoy [1990] 1 WLR 1587, 1625: In a case such as this, where it is claimed that the rule in Hastings Bass applies, three questions arise: (1) What were the trustees under a duty to consider? (2) Did they fail to consider it? (3) If so, what would they have done if they had considered it? In my view Lightman J was right to hold that for the rule to apply the inadequate deliberation on the part of the trustees must be sufficiently serious as to amount to a breach of fiduciary duty. Breach of duty is essential (in the full sense of that word) because it is only a breach of duty on the part of the trustees that entitles the court to intervene (apart from the special case of powers of maintenance of minor beneficiaries, where the court was in the past more interventionist: see para 64 above). It is not enough to show that the trustees deliberations have fallen short of the highest possible standards, or that the court would, on a surrender of discretion by the trustees, have acted in a different way. Apart from exceptional circumstances (such as an impasse reached by honest and reasonable trustees) only breach of fiduciary duty justifies judicial intervention. Mr Ham relied heavily on the decision of the Court of Appeal in Kerr v British Leyland (Staff) Trustees Ltd (1986) [2001] WTLR 1071. In that case Mr Kerr, a member of the British Leyland staff pension scheme, suffered from angina and claimed a disability benefit payable on permanent disability (defined as so that no further employment of any kind is possible). The scheme had a group policy with Legal & General, which obtained separate medical advice and indicated that it would reject the claim. The corporate trustee of the pension scheme decided to follow Legal & General in rejecting the claim. Mr Kerr took proceedings challenging the trustees decision, and was successful at first instance. The Court of Appeal dismissed the corporate trustees appeal. In doing so Fox LJ (with whom Mustill LJ and Caulfield J agreed) made plain that the corporate trustees board was not at fault. There had been a failure of communication. As to the judges declaration that Mr Kerr was entitled to a pension, Fox LJ stated (p 1080): I do not think he was entitled to do that. The decision whether to accept the claim is one for the trustee and not for the court. It seems to me that, in the present case, the decision of the trustee was simply ineffective since the board did not carry out their duty to give a properly informed consideration to the claim. That however does not entitle the Court to substitute its own view of the claim for that of the trustee. I would, therefore, discharge the order of the judge and substitute an order that the decision of the trustees on 28 June 1978 to reject Mr Kerrs claim was of no effect and that the trustee should reconsider the claim. The Kerr case is of interest since (though not reported for 15 years) it is an early example, antedating Mettoy, of the application of something like the Hastings Bass rule. But I think it is important to note that under the British Leyland scheme the corporate trustee did not have any real discretion about disability benefit. It had to exercise a judgment on an issue of fact (permanent disability from any employment). That is an issue on which the court would be much more ready to intervene if the trustee had failed to grasp the real facts. It is an intermediate situation which is arguably closer to a mistaken judgment on an issue of fact than to the defective exercise of a discretion. Kerr may be compared with Mihlenstedt v Barclays Bank International Ltd [1989] IRLR 522. That was a comparable case except that there was a preliminary issue of construction as to whether the relevant rule (which began Early retirement due to ill health will be permitted only when . ) imported a wider discretion. The Court of Appeal decided that the language of the rule was that of obligation and entitlement, and that the judge had erred in supposing that there was a wider discretion. But on the facts the majority of the Court of Appeal held that the trustee had not formed its opinion on an erroneous basis. Mr Hams fallback position was that if a breach of duty was an essential requirement, there could be a breach without fault on the part of any individual trustee being established. This general argument was developed in several different directions. I would identify these (though there was some overlap) as (1) strict liability (2) agency (3) resulting absurdity and (4) a special meaning of relevant. These points are considered below, in turn. Mr Nugee, in supporting Mr Hams position, attached most weight to the argument on strict liability. It is undoubtedly correct that trustees may be liable for breach of trust even though they have acted in accordance with skilled professional advice. Such advice cannot protect trustees from potential liability for a loss to the trust fund resulting from a decision that is, judged objectively, beyond the trustees powers and detrimental to the trust (though professional advice may lead to their obtaining relief under section 61 of the Trustee Act 1925). An example mentioned in argument is Dunn v Flood (1885) 28 Ch D 586, in which trustees had sold by auction 73 plots of freehold land at Reading, subject to special conditions which the court held to be severely depreciatory (as Fry LJ put it at p594, eminently calculated to frighten away purchasers). The Court of Appeal, upholding North J, refused to force a doubtful title on a reluctant purchaser. The fact that the trustees had consulted respectable solicitors was no excuse. It was not a reasonable exercise of discretion (Baggallay LJ and Bowen LJ at p592; Fry LJ at pp593 594). But the trustees breach of duty was not in the manner of their decision making (as to which we know nothing other than that they consulted respectable solicitors) but the loss to the trust property that their unreasonable decision appeared to have caused. Further examples are provided by the decision of the Court of Appeal in Perrins v Bellamy [1899] 1 Ch 797 and that of the Privy Council, on appeal from the Supreme Court of Victoria, in National Trustees Co of Australasia Ltd v General Finance Co of Australasia Ltd [1905] AC 373. These cases, discussed by Lloyd LJ at para 124 of his judgment, were both examples of action taken by trustees on professional advice which was unequivocally incorrect: one a sale of leaseholds when the trustees had no power of sale; the other a distribution (resulting from some extraordinary slip by solicitors of high standing) of a deceased beneficiarys vested share to persons who were not entitled to it under the intestacy law of Victoria in force at the beneficiarys death. As Lloyd LJ observed, the issue in these cases: is altogether different, as it seems to me, from the question whether, if trustees take advice properly, and act on that advice in a matter which is within their powers, the fact that the advice has misled them as to the true position in a relevant respect means that they acted in breach of fiduciary duty. I respectfully agree. Trustees may be liable, even if they have obtained apparently competent professional advice, if they act outside the scope of their powers (excessive execution), or contrary to the general law (for example, in the Australian case, the law regulating entitlement on intestacy). That can be seen as a form of strict liability in that it is imposed regardless of personal fault. Trustees may also be in breach of duty in failing to give proper consideration to the exercise of their discretionary powers, and a failure to take professional advice may amount to, or contribute to, a flawed decision making process. But it would be contrary to principle and authority to impose a form of strict liability on trustees who conscientiously obtain and follow, in making a decision which is within the scope of their powers, apparently competent professional advice which turns out to be wrong. Such a result cannot be achieved by the route of attributing any fault on the part of professional advisers to the trustees as their supposed principals. Solicitors can and do act as agents in some clearly defined functions, usually of a ministerial nature, such as the receipt and transmission of clients funds, and the giving and taking of undertakings on behalf of clients. But they do not and may not act as agents in the exercise of fiduciary discretions. As I said in Scott [1998] 2 All ER 705, 717: It is however for advisers to advise and for trustees to decide: trustees may not (except insofar as they are authorised to do so) delegate the exercise of their discretions, even to experts. Mr Ham relied on some observations of Warner J in Mettoy [1990] 1 WLR 1587, 1625 1626: But the question is not in my view to what extent trustees may in practice have to rely on professional advice. The duty to take into account all material considerations is that of the trustees. The extent of that duty is not affected by the amount or quality of the professional advice they may seek or obtain. In In Re Hastings Bass [1975] Ch 25 it was not relevant to what extent the trustees themselves were able to form an opinion on the effect of the rule against perpetuities. This passage was noted by Lloyd LJ in his discussion of the cases (para 71) but receives only a passing mention in para 124, the part of his judgment which discusses the significance of professional advice. I have difficulty with these observations of Warner J. They occur in the part of his judgment dealing with the first of the three questions that he had posed (para 72 above) and probably they must be read in that context. Moreover the last sentence at p1626 A B suggests that Warner J was not clearly distinguishing the category of excessive execution in Hastings Bass itself from the category of inadequate deliberation relevant to the issue before him. If his remarks cannot be limited to their context then I would say that Warner J was wrong in disregarding the amount or quality of professional advice obtained by trustees, when the question relates to a decision within the scope of the trustees powers. Mr Ham submitted that a refusal to attribute to trustees fault on the part of their advisers or agents leads to counter intuitive and arbitrary distinctions. He instanced an error in a letter setting out the settlors wishes (a variation of the facts in Barr). On that particular example, such an error might be a sufficient ground for a voluntary disposition to be set aside on the ground of mistake, regardless of where responsibility for the error lay. But I would accept that there have been, and no doubt will be in the future, cases in which small variations in the facts lead to surprisingly different outcomes. That is inevitable in an area where the law has to balance the need to protect beneficiaries against aberrant conduct by trustees (the policy behind the Hastings Bass rule) with the competing interests of legal certainty, and of not imposing too stringent a test in judging trustees decision making. There is indeed a striking contrast between the courts conclusions as to the position of Mr Ward Thompson in Barr and that of Mr Cutbill in Futter. Mr Ward Thompsons position was considered in detail by Lightman J [2003] Ch 409, para 27: He was the one point of contact between on the one side the settlor and on the other side C & L, C & L Isle of Man, the trustee and the protector. For all practical purposes he was the emanation and only representative of C & L, C & L Isle of Man, the trustee and the protector in all their dealings with the settlor. C & L was through itself and its associated firm, C & L Isle of Man and its vehicles, the trustee and the protector, providing the settlor with a total corporate and trust holding service. As is common ground the solicitors who drafted the appointment were acting on behalf of the trustee: Mr Ward Thompson in giving instructions for its preparation in the circumstances can only have done so acting as agent for the trustee. These findings (based, it appears, on witness statements not tested by cross examination) show that it was an unusual situation in which Mr Ward Thompson had an exceptionally important role. The judges conclusion was reinforced by another passage in para 27: I should add that my view is reinforced by the consideration that any ambiguity in the structure and arrangements ought to be resolved in favour of the settlor: (1) the C & L side were responsible for the structure and arrangements; (2) Mr Ward Thompson has declined to assist the court; and (3) the trustee perhaps surprisingly failed to seek from the settlor an expression of his wishes in documentary form or provide him with a copy of the proposed appointment before it was executed. In short, on the material before me, on the third issue I am satisfied that the trustee failed in its fiduciary duty to ascertain the true wishes of the settlor to which the appointment was intended to give effect and accordingly the rule is brought into play. Cases of this sort will call for detailed fact finding by the judge, and sometimes no doubt for cross examination. Barr may be contrasted with Abacus Trust Company (Isle of Man) Ltd v NSPCC [2001] STC 1344, in which an artificial tax avoidance scheme failed because a deed of appointment was executed on 3 April 1998, contrary to the clear advice of leading counsel that it should not be executed until after the end of the 1997 98 financial year. On Wednesday, 1 April 1998 the appointment was faxed to the corporate trustee in the Isle of Man by an English solicitor with the suggestion that it should be executed on Friday (naturally taken as 3 April). But a director of the corporate trustee had attended the consultation with leading counsel, and had received a note of it, which he did not refer to when he received the fax. Patten J applied the Hastings Bass rule without finding it necessary to reach any clear conclusion about breach of duty, which was not then recognised as an essential requirement. In Futter Mr Cutbill, a partner in a London firm of solicitors, was involved both as a trustee and as a solicitor advising the trustees. The facts as to his involvement were found at first instance by Norris J [2010] STC 982. It so happened, as already mentioned, that the judgment of Mr Engelhart QC in Pitt was given on 18 January 2010, the first day of the hearing in Futter. In Pitt it had been common ground ([2010] 1 WLR 1199, para 22) that there was no need to identify a breach of duty by the trustees. It is not clear from Norris Js judgment whether the same incorrect concession was made and accepted before him. But Norris J seems to have accepted Sieff v Fox as the leading authority from which to obtain guidance, and Barr received only a passing mention (on the void or voidable? issue) in his judgment. Norris J did not therefore make any clear finding about breach of fiduciary duty. He simply recorded and accepted Mr Cutbills written evidence, which included the statement that [Mr Futter] and I failed to pay any regard to the provisions of section 2(4) [TCGA] at the time, and therefore failed to consider the full tax implications. The Court of Appeal was therefore in as good a position as Norris J to make a finding about breach of duty on the part of the trustees. This Court has before it all the written evidence and exhibits that were before the judge, and in the absence of concurrent findings below it is also in a position to make findings, if necessary, on that issue. I will return to it below when dealing with the disposal of the Futter appeal. Finally, on this part of the case, there is the submission that the trustees duty to take account of relevant considerations is to be interpreted as a duty to act on advice only if it is correct in effect, a duty to come to the right conclusion in every case. I have left this submission until the end because it is to my mind truly a last ditch argument. It involves taking the principle of strict liability for ultra vires acts (paras 81 to 84 above) out of context and applying it in a different area, so as to require trustees to show infallibility of judgment. Such a requirement is quite unrealistic. It would tip the balance much too far in making beneficiaries a special favoured class, at the expense of both legal certainty and fairness. It is contrary to the well known saying of Lord Truro LC in In re Beloved Wilkess Charity (1851) 3 Mac & G 440, 448: . that in such cases as I have mentioned it is to the discretion of the trustees that the execution of the trust is confided, that discretion being exercised with an entire absence of indirect motive, with honesty of intention, and with a fair consideration of the subject. The duty of supervision on the part of this court will thus be confined to the question of the honesty, integrity, and fairness with which the deliberation has been conducted, and will not be extended to the accuracy of the conclusion arrived at, except in particular cases. The trustees duty does not extend to being right (the accuracy of the conclusion arrived at) on every occasion. The particular cases that the Lord Chancellor had in mind may have included cases concerned with the maintenance of minor beneficiaries. They may also have included cases (such as Kerr v British Leyland (Staff) Trustees Ltd) in which the trustees have to make a particular factual judgment, rather than exercise a wide discretion. As a first footnote on the topic of fault, I would mention that in para 128 of his judgment, Lloyd LJ observed that a claim by beneficiaries against trustees may often be precluded by an exoneration clause in the trust instrument. Mr Philip Jones QC (for the Revenue) disputed this, pointing out that even if a trustee is exonerated from liability to pay equitable compensation, he is still liable to injunctive relief to prevent a threatened breach of trust, and personal and proprietary remedies may be available against persons who receive assets distributed in breach of trust. Moreover an exoneration clause does not protect a trustee against removal from office by order of the court. The Futter No 3 and No 5 settlements contain exoneration clauses in conventional terms, stating that in the professed execution of the trusts and powers hereof no trustee shall be liable for a breach of trust arising from a mistake or omission made by him in good faith. I would not treat that clause as ousting the application of the Hastings Bass rule, if it were otherwise applicable. As a second footnote, there was some discussion in the course of argument as to the significance, in situations of this sort, of a possible claim for damages against professional advisers for financial loss caused by incorrect advice (or incorrect implementation of instructions). Mr Nugee referred to Walker v Geo H Medlicott & Son [1999] 1 WLR 727, in which a strong Court of Appeal dismissed on two grounds a claim for damages for professional negligence in preparing a will. The second ground was that the aggrieved claimants proper course was to mitigate his damage by seeking rectification of the will. That decision may reflect the courts view of the particular facts of the case, and the feeling that if the drafting of the will had gone wrong other beneficiaries under it should not obtain adventitious benefits. In principle the possibility that trustees may have a claim for damages should have no effect on the operation of the Hastings Bass rule. In practice it will be rare for trustees to have so strong a claim that they can be confident of obtaining a full indemnity for their beneficiaries loss and their own costs. In the Pitt case this court was told that the claim against Frenkel Topping has been settled. Had it gone to trial the claim, even if successful in establishing duty and breach, might have faced difficulties over causation, since Mrs Pitt executed the SNT under the authority of an order of the Court of Protection, which had considered its terms. That courts apparent lack of awareness of the importance of section 89 of the Inheritance Act 1984 is one of the most remarkable features of the whole sorry story. Would or Might? In his statement of the correct principle (para 127 of the judgment, set out in para 70 above) Lloyd LJ did not provide an answer to the would or might? debate. That was not, I think, an oversight. The Hastings Bass rule is centred on the failure of trustees to perform their decision making function. It is that which founds the courts jurisdiction to intervene if it thinks fit to do so. Whether the court will intervene is another matter. Buckley LJs statement of principle in Hastings Bass (para 24 above) cannot be regarded as clear and definitive guidance, since Buckley LJ was considering a different matter the validity of a severed part of a disposition, the other part of which was void for perpetuity. In Mettoy itself the trustees had wholly failed to consider (or even to be aware of) an important change in the new rules (affecting the destination of surplus in a winding up of the scheme), at a time when winding up was a real possibility. But Warner J (applying Buckley LJs would not formulation) declined to set aside the adoption of the new rules, because the power over surplus remained a fiduciary power. It has been suggested (partly in order to accommodate the decision of the Court of Appeal in Stannard, para 34 above) that would not is the appropriate test for family trusts, but that a different might not test (stricter from the point of view of the trustees, less demanding for the beneficiaries) is appropriate for pensions trusts, since members of a pension scheme are not volunteers, but have contractual rights. That is an ingenious suggestion, and in practice the court may sometimes think it right to proceed in that way. But as a matter of principle there must be a high degree of flexibility in the range of the courts possible responses. It is common ground that relief can be granted on terms. In some cases the court may wish to know what further disposition the trustees would be minded to make, if relief is granted, and to require an undertaking to that effect (see In re Badens Deed Trusts [1971] AC 424, referred to in para 63 above). To lay down a rigid rule of either would not or might not would inhibit the court in seeking the best practical solution in the application of the Hastings Bass rule in a variety of different factual situations. Void or Voidable? Counsel on both sides readily admitted that they had hesitated over this point, but in the end they were all in agreement that Lloyd LJ was right in holding (para 99) that, if an exercise by trustees of a discretionary power is within the terms of the power, but the trustees have in some way breached their duties in respect of that exercise, then (unless it is a case of a fraud on the power) the trustees act is not void but it may be voidable at the instance of a beneficiary who is adversely affected. In my judgment that is plainly right, and in the absence of further argument on the point it is unnecessary to add much to it. The issue has been clouded, in the past, by the difficult case of Cloutte v Storey, a case on appointments that are fraudulent in the equitable sense, that is made for a positively improper purpose. Here we are concerned not with equitable fraud, nor with dispositions which exceed the scope of the power, or infringe the general law (such as the rule against perpetuity). We are in an area in which the court has an equitable jurisdiction of a discretionary nature, although the discretion is not at large, but must be exercised in accordance with well settled principles. The working out of these principles will raise problems which must be dealt with on a case by case basis. The mistake claim in Pitt involves a problem of that sort. But it is unnecessary and inappropriate to prolong what is already a very long judgment by further discussion of problems that are not now before this court. Disposal of the Hastings Bass issues In Futter the essential issue was whether the trustees of the No 3 and No 5 settlements, in deciding to take the steps which they took in March and April 2008, failed in their duty to take relevant considerations into account. Capital gains tax was a relevant consideration. Indeed, it is fairly plain that it was the paramount consideration, and the trustees thought about it a great deal. But the tax advice which they received and acted on was wrong, because an amendment to section 2(4) of TCGA had been overlooked. As Lloyd LJ put it succinctly (para 138): They did not overlook the need to think about CGT. They were given advice on the right point. The problem was that the advice was wrong. The only complication was that Mr Cutbill (the solicitor trustee) was a member of both teams: the solicitors giving the erroneous advice, and the trustees receiving and acting on it. I agree with the Court of Appeal that it would be artificial to distinguish between the two trustees, who acted together in making and effectuating their decisions. I would if necessary go further and hold that the documentary evidence indicates that most if not all of the technical tax advice given by his firm came not from Mr Cutbill but from the assistant solicitor who was working with him, from January 2008, in a review of a number of different Futter family settlements. Until 27 March 2008 it was supposed, wrongly, that the No 3 settlements stockpiled gains were relatively small, and the fact that they amounted to about 188,000 led to a last minute change of plan. On 28 March 2008 there was a telephone conversation between the assistant solicitor and Mr Bunce, Mr Futters accountant, at which, without reference to Mr Cutbill, she definitely confirmed that Mr Futters personal losses could be set off against the section 87 gains. Mr Cutbill seems to have been, very properly, reluctant to put the blame on a junior member of his firm, and of course his firm must take legal responsibility for any actionable mistake by any of its fee earners. But the documents in exhibit CDC 1 to Mr Cutbills witness statement tend to confirm that he should not, as a trustee of the No 3 and No 5 settlements, be treated as having been personally in breach of fiduciary duty. In Pitt the position was even clearer. As her husbands receiver under the Mental Health Act 1983 Mrs Pitt was in a fiduciary position but there is no suggestion that she had any professional qualifications. She devoted herself, alternating with a carer, to looking after her disabled husband. As anyone in that position would, she took professional advice from solicitors and specialist consultants. After hearing from her legal advisers and the Official Solicitor the Court of Protection made an order on 1 September 1994 authorising (not directing) her to execute the SNT and she acted on that authority on 1 November 1994 (the date in para 161 of Lloyd LJs judgment seems to be an error; compare para 151). She had taken supposedly expert advice and followed it. There is no reason to hold that she personally failed in the exercise of her fiduciary duty. Unfortunately the advice was unsound. as it turns on the Hastings Bass rule. I would therefore dismiss the appeal in Futter, and the appeal in Pitt so far RESCISSION ON THE GROUND OF MISTAKE Mrs Ogilvies litigation In this part of his judgment Lloyd LJ began with the litigation conducted by Mrs Ogilvie at the end of the 19th century. Mrs Ogilvie was a very rich widow who had in 1887 executed two deeds settling large funds for charitable purposes. She was described by Byrne J (in the transcript included in the appendix printed for the eventual appeal to the House of Lords, pp 862 863) as undoubtedly a good woman of business, shrewd, clever and intelligent, having been accustomed to assist her husband in business matters. She had a proper sense of the responsibilities of great wealth, she was charitable and munificent. She had strong views on certain subjects, was impatient of any attempt to thwart or control her, and though perhaps at times inclined to be somewhat changeable, she was firm and decided as to her course of action when she had made up her mind and laid down what she terms her law in respect to any matter. Seven years later she brought an action to have the deeds set aside. She relied on grounds summarized by Byrne J (p 862) as follows: (1) That she had not preserved to her the absolute power of disposing of the capital, including the land, as she thought fit during her life, and that notwithstanding express instructions to the contrary. (2) That she had not a similar absolute power in respect to income. (3) That she is liable to interference by the Charity Commissioners and by her own Trustees, and to be called upon by them to account for her administration of the income and that notwithstanding express instructions to the contrary. (4) That she has not the power to apply moneys originally dedicated to London institutions to Suffolk institutions. (5) That she was not fully and properly advised and that she did not fairly understand the nature and effect of the documents she executed. These grounds were fully explored in the pleadings, in interrogatories, and in cross examination at the nine day trial. Originally there was an alternative claim for rectification but her counsel did not rely on that claim, although it seems (pp 903 905) that the Attorney General (who appeared in person at every stage of the proceedings) made an open offer for the case to be disposed of uncontentiously on that basis. Byrne J gave a judgment, over 50 pages long in the transcript, in which he said (p 901), The case is entirely wanting in any of those elements of fraud, undue influence, concealments of facts from the donor, want of separate and independent advice, surprise or pressure, which, or some of which, are commonly to be met with in cases of attempts to set aside or rectify voluntary instruments. The judge rejected almost entirely the criticisms that Mrs Ogilvie directed towards her legal advisers: The utmost that could be suggested against Mr Smith is that he misunderstood his instructions, or that he was guilty of error of judgment in not having with more insistence determined to see his client personally, and against Mr Smith, Mr Harding, Mr Sutherland, and their counsel, that possibly they allowed their natural and perfectly unselfish wish to see the charitable scheme carried through to permit them to neglect informing the plaintiff of every trouble and difficulty of detail which arose in the matter. (Mr Smith was the London solicitor of Mrs Ogilvie, who lived in Suffolk; Mr Harding was a respected member of the Society of Friends, who gave her advice; and Mr Sutherland was her late husbands confidential clerk.) Her action was dismissed. She appealed to the Court of Appeal, where in view of the trial judges clear findings the argument seems to have been more closely focused as mistake. Giving the judgment of the Court of Appeal Lindley LJ said (Ogilvie v Littleboy (1897) 13 TLR 399, 400): Gifts cannot be revoked, nor can deeds of gift be set aside, simply because the donors wish that they had not made them and would like to have back the property given. Where there is no fraud, no undue influence, no fiduciary relation between donor and donee, no mistake induced by those who derive any benefit by it, a gift, whether by mere delivery or by deed, is binding on the donor . In the absence of all circumstances of suspicion a donor can only obtain back property which he has given away by showing that he was under some mistake of so serious a character as to render it unjust on the part of the donee to retain the property given to him. Mrs Ogilvies grounds of complaint seem to have been revised a little. The alleged mistakes as to the application of capital or income for non charitable purposes, and as to the jurisdiction of the Charity Commissioners, could not be sustained on the judges findings. As to the fourth ground (relating to sales of land) the Court of Appeal held that the mistake, such as it was, cannot be regarded as so material as to affect the validity of the deeds. The fifth ground had been reformulated as a failure by her advisers to warn her that members of the Society of Friends might be unwilling to become trustees. As to this Lindley LJ observed (p 401): But, assuming the danger to be real, assuming that it was an error of judgment not to call the plaintiffs attention to it, is such an omission enough to entitle her to have the deeds set aside? We are not aware of any legal principle which goes this length or anything like it. The complaint is not that her intentions have not been carried out; it is that a possible danger known to her advisers was not pointed out to her. So the appeal was dismissed, as was a further appeal to the House of Lords (Ogilvie v Allen (1899) 15 TLR 294). Lord Halsbury LC said (p 295): The appellant, a lady, was desirous of establishing certain charities, and she now contends that, though she did intend to devote her money to charity, certain specific intentions as to management, control, independence of control, and the like were such essential and important considerations to her mind that in these respects she was misled, and now seeks to get rid of the effect of her deeds upon that allegation. Such questions, doubtless, may arise under circumstances where misunderstanding on both sides may render it unjust to the giver that the gift should be retained. It appears to me that there are no such circumstances here. I entirely concur with the judgment delivered by the present Master of the Rolls . So did Lord Macnaghten, who said that Lindley LJs judgment deals with the case so fully and so satisfactorily that there is nothing more to be added. Lord Morris concurred. Lloyd LJ reviewed and discussed other 19th century and modern authorities, including the first instance decisions in Gibbon v Mitchell [1990] 1 WLR 1304 and In re Griffiths, decd [2009] Ch 162. He questioned the result in the latter case. The framework of his conclusion (paras 210 and 211) was that for the exercise of the equitable jurisdiction to set aside a voluntary disposition there must be (1) a mistake, which is (2) of the relevant type and (3) sufficiently serious to satisfy the Ogilvie v Littleboy test. That is a convenient framework against which to consider the authorities, although there is obviously some overlap between the three heads. In general a mistake as to the essential nature of a transaction is likely to be more serious than a mistake as to its consequences. What is a mistake? For present purposes a mistake must be distinguished from mere ignorance or inadvertence, and also from what scholars in the field of unjust enrichment refer to as misprediction (see Seah, Mispredictions, Mistakes and the Law of Unjust Enrichment [2007] RLR 93; the expression may have first received judicial currency in Dextra Bank & Trust Co Ltd v Bank of Jamaica [2002] 1 All ER (Comm) 193). These distinctions are reasonably clear in a general sort of way, but they tend to get blurred when it comes to facts of particular cases. The editors of Goff and Jones, The Law of Unjust Enrichment, 8th ed. (2011) para 9 11 comment that the distinction between mistake and misprediction can lead to some uncomfortably fine distinctions, and the same is true of the distinction between mistake and ignorance. Forgetfulness, inadvertence or ignorance is not, as such, a mistake, but it can lead to a false belief or assumption which the law will recognise as a mistake. The Court of Appeal of Victoria has held that mistake certainly comprehends a mistaken belief arising from inadvertence to or ignorance of a specific fact or legal requirement: Ormiston JA in Hookway v Racing Victoria Ltd [2005] VSCA 310, (2005) 13 VR 444, 450. That case was on the borderline between voluntary disposition and contract. It concerned prize money for a horse race which was paid to the wrong owner because the official in charge of prize money was ignorant of a recent change in the rules of racing (permitting an appeal against disqualification after a drugs test). He made a mistake as to the real winner. The best known English authority on this point is Lady Hood of Avalon v Mackinnon [1909] 1 Ch 476. Under a settlement Lord and Lady Hood had a joint power of appointment, and later Lady Hood as the survivor had a sole power of appointment, in favour of the children and remoter issue of their marriage. They had two daughters. In 1888 half the trust fund had been appointed (subject to the prior life interests of Lord and Lady Hood) to their elder daughter on her marriage, and had been resettled by her. In 1902 and 1904, after Lord Hoods death, Lady Hood appointed a total of 8,600 to her younger daughter. Then, wishing to achieve equality, as she thought, between her daughters, and entirely forgetting the 1888 appointment, she appointed a further 8,600 to her elder daughter (so inevitably producing inequality, unless the appointment were set aside). The elder daughter did not oppose Lady Hoods action for rescission of the last appointment, but the trustees of the resettlement (which contained an after acquired property covenant) did oppose it. Eve J granted relief, stating (pp 483 484): Having regard to the facts which I have stated, I must assume that Lady Hood, intending only to bring about equality between her daughters, was labouring under a mistake when she thought that equality would be brought about by the execution of the deed appointing 8,600 to her elder daughter. It was obviously a mistake, because the effect of the execution of that deed was to bring about that which Lady Hood never intended and never contemplated. In his judgment Eve J referred at length to the decision of the Court of Appeal in Barrow v Isaacs & Son [1891] 1 QB 417. In that case the Court of Appeal declined to grant relief, on the ground of mistake, from forfeiture of a lease for breach of a covenant against underletting. The solicitors acting for a respectable tenant had overlooked the covenant and the premises had been sublet to a respectable sub tenant. Both Lord Esher MR and Kay LJ commented that there was no legal definition of mistake. Lord Esher MR said (at pp 420 421) that the head tenant had had a mere passive state of mind: I should say that mere forgetfulness is not mistake at all in ordinary language. I cannot find any decision in Courts of Equity which has ever stated that mere forgetfulness is mistake against which equity would relieve. But Kay LJ (with whom Lopes LJ agreed) seems to have taken the view that there was a mistake which equity had power to relieve, although in the circumstances of the case the court declined to grant relief. The power to relieve would, it seems, have been based on the conscious belief or tacit assumption that the underletting was lawful. The fullest academic treatment of this topic is in Goff & Jones at paras 9 32 to 9 42. The editors distinguish between incorrect conscious beliefs, incorrect tacit assumptions, and true cases of mere causative ignorance (causative in the sense that but for his ignorance the person in question would not have acted as he did). The deputy judges first instance decision in Pitt [2010] 1 WLR 1190, para 50 is suggested as an example of mere causative ignorance: If someone does not apply his mind to a point at all, it is difficult to say that there has been some real mistake about it. The Court of Appeal adopted a different view of the facts, treating the case (para 216) as one of an incorrect conscious belief on the part of Mrs Pitt that the SNT had no adverse tax consequences. The editors of Goff & Jones are, on balance, in favour of treating mere causative ignorance as sufficient. They comment (at para 9 41, in answering a floodgates objection): . denying relief for mere causative ignorance produces a boundary line which may be difficult to draw in practice, and which is susceptible to judicial manipulation, according to whether it is felt that relief should be afforded with the courts finding or declining to find incorrect conscious beliefs or tacit assumptions according to the courts perception of the merits of the claim. It may indeed be difficult to draw the line between mere causative ignorance and a mistaken conscious belief or a mistaken tacit assumption. I would hold that mere ignorance, even if causative, is insufficient, but that the court, in carrying out its task of finding the facts, should not shrink from drawing the inference of conscious belief or tacit assumption when there is evidence to support such an inference. I shall return (paras 127 and 128 below) to the suggestion that this may involve judicial manipulation. A misprediction relates to some possible future event, whereas a legally significant mistake normally relates to some past or present matter of fact or law. But here too the distinction may not be clear on the facts of a particular case. The issue which divided the House of Lords in Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349 was whether (as Lord Hoffmann put it at p398) the correct view was that, a person who pays in accordance with what was then a settled view of the law has not made a mistake and that his state of mind could be better described as a failure to predict the outcome of some future event (sc a decision of this House) than a mistake about the existing state of the law. There is another interesting discussion of this point in the judgments given in the Court of Appeal in Brennan v Bolt Burdon [2005] QB 303. A problem about the boundary between mistake and misprediction arose in In re Griffiths, decd [2009] Ch 162, a decision of Lewison J. Like Sieff v Fox and some other cases on the Hastings Bass rule, it was a case in which the Revenue was invited to intervene but declined to do so, despite the large sum of inheritance tax at stake. The case was therefore heard without adversarial argument as to the law or the facts. Lloyd LJ commented (para 198) that he did not criticise the judge, given the limited argument before him, but that he did question his conclusion. I agree with both limbs of that comment. It is important to note the sequence of events in In re Griffiths. Mr Griffiths had a valuable holding in Iota, a property company (whose shares did not attract business assets relief). He was aged 73 when, in January 2003, he and his wife took advice about tax planning. They received a lengthy report setting out various options. Most involved making potentially exempt transfers, which progressively reduce inheritance tax on qualifying gifts if the donor survives for three years, and avoid tax entirely if the donor survives for seven years after making the gift. The report recommended that seven year term insurance cover should be obtained. Mr Griffiths decided to take various steps, the most important of which was a settlement of Iota shares worth over 2.6m. This was effected by a two stage process which was completed in February 2004. He decided not to obtain term insurance. Unfortunately he was diagnosed with lung cancer in October 2004, and died in April 2005. Had he done nothing, the Iota shares would have formed part of his residuary estate, in which his wife took a life interest, and no inheritance tax would have been payable on his death. In those circumstances his executor commenced proceedings asking that the dispositions should be set aside on the ground of mistake ([2009] Ch 162, para 6): The relevant mistake on which they rely is that Mr Griffiths mistakenly believed, at the time of the transfers, that there was a real chance that he would survive for seven years, whereas in fact at that time his state of health was such that he had no real chance of surviving that long. The medical evidence (in the form of letters from his general practitioner, from a consultant oncologist and from a consultant rheumatologist) was inconclusive, but the GP expressed the view that it was extremely unlikely that the cancer was present in April 2003. On this evidence the judge found that in April 2003 Mr Griffiths had a life expectancy of between seven and nine years. He went on to observe (para 18): It is unfortunate that in a case involving 1m worth of tax a proper medical report was not placed before the court and that the claimants are compelled to rely on a single sentence in a letter from [the oncologist]. Although I have hesitated about this finding, I am prepared to find, by a narrow margin that he was suffering from lung cancer on 3 February 2004; and that following the onset of lung cancer at that time his life expectancy did not exceed three years in February 2004. Had the facts been contested, I might not have felt able to make this finding. On the rather uncertain foundation of that finding the judge decided that the assignment of 3 February 2004 should be set aside (para 30): By that time Mr Griffiths was suffering from lung cancer about which he was unaware. He did therefore make a mistake about his state of health. Had he known in February 2004 that he was suffering from lung cancer he would also have known that his chance of surviving for three years, let alone for seven years, was remote. In those circumstances I am persuaded that he would not have acted as he did by transferring his reversionary interest in the shares to trustees. The judge did not say whether this was (in the Goff & Jones formulation) an incorrect conscious belief or an incorrect tacit assumption. The editors of that work (para 9 36) treat it as a tacit assumption but it seems close to the residual category of mere causative ignorance. Had the judge not made his hairs breadth finding about the presence of cancer in February 2004 it would have been a case of misprediction, not essentially different from a failure to predict a fatal road accident. Lloyd LJ observed (para 198) that it was strongly arguable that, having declined to follow the financial consultants recommendation of term insurance, Mr Griffiths was taking the risk of deterioration of his health and failure to survive the statutory period. What type of mistake? Some uncontroversial points can be noted briefly. It does not matter if the mistake is due to carelessness on the part of the person making the voluntary disposition, unless the circumstances are such as to show that he deliberately ran the risk, or must be taken to have run the risk, of being wrong. (There is an illuminating discussion of this point in Lord Hoffmanns speech in Deutsche Morgan Grenfell Group plc v Inland Revenue Commissioners [2007] 1 AC 558, paras 24 30). Nor need the mistake be known to (still less induced by) the person or persons taking a benefit under the disposition. The fact that a unilateral mistake is sufficient (without the additional ingredient of misrepresentation or fraud) to make a gift voidable has been attributed to gifts being outside the laws special concern for the sanctity of contracts (OSullivan, Elliott and Zakrzewski, The Law of Rescission (2007) para 29.22): It is apparent from the foregoing survey that vitiated consent permits the rescission of gifts when unaccompanied by the additional factors that must be present in order to render a contract voidable. The reason is that the laws interest in protecting bargains, and in the security of contracts, is not engaged in the case of a gift, even if made by deed. Conversely, the fact that a purely unilateral mistake may be sufficient to found relief is arguably a good reason for the court to apply a more stringent test as to the seriousness of the mistake before granting relief. The Revenues printed case (paras 70 to 74) seeks to play down the distinction between mistake in the law of contract and its role in equitable rescission of voluntary dispositions. It seeks to build boldly on the decision of the Court of Appeal in Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd (The Great Peace) [2002] EWCA Civ 1407, [2003] QB 679, which did not follow (and has effectively overruled) Solle v Butcher [1950] 1 KB 671. The argument is that logic requires that a deed which transfers property for no consideration can be set aside only for a mistake of a fundamental nature that would render a contract void. Mr Jones did not cite any authority for this heterodox submission, and there is high authority (starting with Ogilvie v Allen) against it. Equity will grant specific performance of a covenant only if it is supported by valuable consideration. This includes the marriage consideration, but only if the covenant is being enforced by or on behalf of a person or persons within the scope of the marriage consideration. The traditional rules of equity were considered and explained by the Court of Appeal in Attorney General v Jacobs [1895] 2 KB 341, an account duty case, and In re Cooks Settlement Trusts [1965] Ch 902, a decision of Buckley J, illustrates their application within living memory. They are necessary to the understanding of cases like Ellis v Ellis (1909) 26 TLR 166, where the after acquired property covenant in Mrs Elliss marriage settlement was enforceable in equity, because there were children of the marriage. But the notion that any voluntary disposition should be accorded the same protection as a commercial bargain, simply because it is made under seal, is insupportable. Leaving aside for the present the degree of seriousness of the mistake, there is also controversy about its nature (or characteristics), especially as to the distinction between effect and consequences drawn by Millett J in Gibbon v Mitchell [1990] 1 WLR 1304. In that case two funds (Mays fund and Henrys fund) were settled in 1946 by Mr Henry Gibbons parents on the occasion of the marriage of his sister May. The funds were settled on May and Henry respectively for life, on the statutory protective trusts in section 33 of the Trustee Act 1925 (with a modification in the case of Henrys fund), but with power for May to surrender her protected life interest so as to accelerate the interests of her children once they had attained vested interests. For some unknown reason there was no corresponding power in respect of Henrys fund. The consequence was that a purported surrender by Mr Gibbon would cause a forfeiture of his fixed interest and bring into operation a discretionary trust affecting income during the rest of his life. In 1987 Mr Gibbon was a prosperous farmer aged 69, with two adult children. He wished to take steps to save inheritance tax and was advised by his accountants and solicitors to surrender his life interest, and at the same time release two powers of appointment, so as to accelerate his childrens interests. This advice was expressed in terms of enabling Henrys fund to pass immediately to the two children. His professional advisers failed to recognise, until after the deed of surrender had been executed, that the protective trusts provided a trap. Mr Gibbon applied to the court to have the deed of surrender set aside on the ground of mistake, and also for relief under the Variation of Trusts Act 1958. Millett J set the surrender aside, and varied the trust by lifting the protective trusts. In his judgment he referred to several of the older authorities, in most of which solicitors had misunderstood or gone beyond their instructions: Meadows v Meadows (1853) 16 Beav 401, Walker v Armstrong (1856) 8 De G M & G 531, Ellis v Ellis (1909) 26 TLR 166 and In re Waltons Settlement [1922] 2 Ch 509. Ogilvie v Littleboy was not cited. Millett J set out the principle which he drew from them at p1309: In my judgment, these cases show that, wherever there is a voluntary transaction by which one party intends to confer a bounty on another, the deed will be set aside if the court is satisfied that the disponor did not intend the transaction to have the effect which it did. It will be set aside for mistake whether the mistake is a mistake of law or a fact, so long as the mistake is as to the effect of the transaction itself and not merely as to its consequences or the advantages to be gained by entering into it. It will be observed that this formulation does not include the Ogilvie v Littleboy requirement of seriousness, except so far as it might be argued that any mistake as to the effect of a disposition is likely to be relatively serious. Millett Js judgment has been very influential. It is a mark of the high respect in which he is held that an extempore first instance judgment, not (so far as appears from the judgment) based on much adversarial argument, is cited as one of the key authorities in most of the standard works on equity and trusts, including Snell, 32nd ed. (2010) 11 008, 22 052; Lewin, 18th ed. (2008) 4 58, 29 231; Underhill and Hayton, 18th ed. (2010) 15 28 to 15 34; and Thomas and Hudson, 2nd ed. (2010) 20.37. But the source from which Millett Js statement of principle is derived is far from clear and it has been the subject of some criticism, both from legal scholars and in more recent decisions of the court. It is generally agreed that effect must mean legal effect (in the sense of the legal character or nature of a transaction). In Dent v Dent [1996] 1 WLR 683, 693 the deputy judge (David Young QC) understood it as the purpose or object of a transaction. Several other first instance judges have commented that the distinction between effect and consequences is not always clear, including Davis J in Anker Petersen v Christensen [2002] WTLR 313, 330. Lawrence Collins J went further in AMP (UK) plc v Barker [2001] WTLR 1237, para 70, saying of the distinction: If anything, it is simply a formula designed to ensure that the policy involved in equitable relief is effectuated to keep it within reasonable bounds and to ensure that it is not used simply when parties are mistaken about the commercial effects of their transactions or have second thoughts about them. On that view it comes close to Lindley LJs more general requirement for the mistake to be serious. In Wolff v Wolff [2004] STC 1633, Mann J considered (para 23) that the test was not a limiting factor, and (para 26) noted that Lawrence Collins J had referred to commercial consequences, not legal consequences. Lloyd LJ has now reviewed Gibbon v Mitchell twice, first in Sieff v Fox and then in Pitt v Holt. In Sieff v Fox, Ogilvie v Littleboy was brought to light after a long period of obscurity (though it is mentioned in Peter Birks Introduction to the Law of Restitution, first published in 1985). Lloyd LJ noted (para 106) that a test based on the legal effect of a transaction could not cover the tax consequences of a transaction, but that Lindley LJs more general test in Ogilvie v Littleboy might do so. He expressed no final view because of the special circumstances of the case before him ([2005] 1 WLR 3811, para 116). In Pitt v Holt Lloyd LJ went further. He expressed the view (para 208) that some recent cases about offshore trusts did not accord with English law: Clarkson v Barclays Private Bank and Trust (Isle of Man) Ltd [2007] WTLR 1703; In re Betsam Trust [2009] WTLR 1489; and In re A Trust [2009] JLR 447. He accepted the distinction made by Millett J in Gibbon v Mitchell but extended it (para 210) by formulating it as a requirement . that, for the equitable jurisdiction to set aside a voluntary disposition for mistake to be invoked, there must be a mistake on the part of the donor either as to the legal effect of the disposition or as to an existing fact which is basic to the transaction. This extension seems to have been primarily to accommodate cases such as Lady Hood of Avalon, where there was (para 206) a fundamental error of fact, in relation to a point which lay at the heart of the transaction. He also seems to have had in mind the New Zealand case of University of Canterbury v Attorney General [1995] 1 NZLR 78, which is discussed at para 199 of his judgment. The special feature of that case was that the University had to some extent encouraged, or at least failed to correct, the donors error; it wished to return the gift but the Attorney General, representing the public interest in charity, opposed that course. In addition, the mistake must, Lloyd LJ said, meet the Ogilvie v Littleboy test of sufficient gravity. This approach has been criticised by the editors of Goff & Jones, paras 9 101 to 9 106. I do not agree with all these criticisms of what the editors refer to as the Court of Appeals stricter, hybrid approach. But I can see no reason why a mistake of law which is basic to the transaction (but is not a mistake as to the transactions legal character or nature) should not also be included, even though such cases would probably be rare. If the Gibbon v Mitchell test is further widened in that way it is questionable whether it adds anything significant to the Ogilvie v Littleboy test. I would provisionally conclude that the true requirement is simply for there to be a causative mistake of sufficient gravity; and, as additional guidance to judges in finding and evaluating the facts of any particular case, that the test will normally be satisfied only when there is a mistake either as to the legal character or nature of a transaction, or as to some matter of fact or law which is basic to the transaction. To confirm the Gibbon v Mitchell test as formulated by Millett J would in my view leave the law in an uncertain state, as the first instance decisions mentioned in para 119 above tend to demonstrate. It would also be contrary to the general disinclination of equity to insist on rigid classifications expressed in abstract terms. Equity, unlike many continental systems, has not adopted Roman laws classification of mistakes: error in negotio (the nature of the intended transaction), error in corpore (the subject matter of the transaction), error in persona (the identity of the other party to the transaction) and error in substantia (the quality of the subject matter). The Gibbon v Mitchell test, at any rate if applied narrowly, would cover only the first of these categories. But in some situations errors in other categories may be just as basic and just as serious in their consequences. The conscience test Lindley LJs test in Ogilvie v Littleboy, quoted at para 101 above, requires the gravity of the causative mistake to be assessed in terms of injustice or, to use equitys cumbersome but familiar term, unconscionableness. Similarly Millett J said in Gibbon v Mitchell [1990] 1 WLR 1304, 1310: Equity acts on the conscience. The parties [in] whose interest it would be to oppose the setting aside of the deed are the unborn future children of Mr Gibbon and the objects of discretionary trusts to arise on forfeiture, that is to say his grandchildren, nephews and nieces. They are all volunteers. In my judgment they could not conscionably insist upon their legal rights under the deed once they had become aware of the circumstances in which they had acquired them. The evaluation of what is or would be unconscionable must be objective. Millett J identified precisely the class of beneficiaries in whose interest it would be for the forfeiture to stand (apart from tax considerations which made it disadvantageous for the whole family), but he did not do so in order to embark on the impossible task of establishing the state of the consciences of minor and unborn beneficiaries. Nor (apart from a defence of change of position) would the relative prosperity of the donor and the donees be relevant, except so far as it was part of the mistake (as in Lord Scotts example in Deutsche Morgan Grenfell Group Plc v Inland Revenue Courts [2007] 1 AC 558, para 87: A gift of 1,000 by A to B where B is believed to be impecunious but is in fact a person of substantial wealth). The gravity of the mistake must be assessed by a close examination of the facts, whether or not they are tested by cross examination, including the circumstances of the mistake and its consequences for the person who made the vitiated disposition. Other findings of fact may also have to be made in relation to change of position or other matters relevant to the exercise of the courts discretion. Justice Paul Finn wrote in a paper, Equitable Doctrine and Discretion in Remedies published in Restitution: Past, Present and Future (1998): The courts quite consciously now are propounding what are acceptable standards of conduct to be exhibited in our relationships and dealings with others . A clear consequence of this emphasis on standards (and not on rules) is a far more instance specific evaluation of conduct. The injustice (or unfairness or unconscionableness) of leaving a mistaken disposition uncorrected must be evaluated objectively, but with an intense focus (in Lord Steyns well known phrase in In re S (A Child) [2005] 1 AC 593, para 17) on the facts of the particular case. That is why it is impossible, in my view, to give more than the most tentative answer to the problems posed by Professor Andrew Burrows in his Restatement of the English Law of Unjust Enrichment (2013) p 66: we simply do not know enough about the facts. I add a postscript as to the criticism made by the editors of Goff & Jones (para 9 41), already quoted at para 108 above, of a boundary line which may be difficult to draw in practice, and which is susceptible to judicial manipulation, according to whether it is felt that relief should be afforded with the courts finding or declining to find incorrect conscious beliefs or tacit assumptions according to the courts perception of the merits of the claim. There is some force in this, although the term manipulation is a bit harsh. The fact that a unilateral mistake is sufficient means that the court may have to make findings as to the state of mind, at some time in the past, of a claimant with a lively personal interest in establishing that there was a serious causative mistake. This will often be a difficult task. But as a criticism of the Court of Appeal in Pitt I would reject it. The case was heard on affidavit evidence, without cross examination, and the Court of Appeal was in as good a position as the deputy judge to draw inferences and make findings of fact. More generally, the apparent suggestion that the court ought not to form a view about the merits of a claim seems to me to go wide of the mark. In a passage in Gillett v Holt [2001] Ch 210, 225, since approved by the House of Lords (see especially the speech of Lord Neuberger, with which the rest of the House agreed, in Fisher v Brooker [2009] 1 WLR 1764, para 63) I said in discussing proprietary estoppel that although its elements (assurance, reliance and detriment) may have to be considered separately they cannot be treated as watertight compartments: . the fundamental principle that equity is concerned to prevent unconscionable conduct permeates all the elements of the doctrine. In the end the court must look at the matter in the round. In my opinion the same is true of the equitable doctrine of mistake. The court cannot decide the issue of what is unconscionable by an elaborate set of rules. It must consider in the round the existence of a distinct mistake (as compared with total ignorance or disappointed expectations), its degree of centrality to the transaction in question and the seriousness of its consequences, and make an evaluative judgment whether it would be unconscionable, or unjust, to leave the mistake uncorrected. The court may and must form a judgment about the justice of the case. Mistakes about tax In this court Mr Jones applied for and obtained permission to raise two points which had not been raised below. The first (to be found in paras 80 to 95 of the Revenues case) was that a mistake which relates exclusively to tax cannot in any circumstances be relieved. This submission, for which no direct authority was cited, was said to be based on Parliaments general intention, in enacting tax statutes, that tax should be paid on some transaction of a specified type, whether or not the taxpayer is aware of the tax liability. Mistake of law is not a defence, Mr Jones submitted, to tax lawfully due and payable. In my opinion that submission begs the question, since if a transaction is set aside the Court is in effect deciding that a transaction of the specified description is not to be treated as having occurred. In the case of inheritance tax, this is expressly provided by section 150 of the Inheritance Tax Act 1984. That section is expressed in general terms as applying where a transfer has by virtue of any enactment or rule of law been set aside as voidable or otherwise defeasible, and the effect is that tax which would not have been paid or payable if the relevant transfer had been void ab initio is to be repaid, or cease to be payable. There is no exception in section 150 for avoidance on the ground of a mistake about tax. More generally, Mr Joness submission that tax is somehow in a different category is at odds with the approach of the House of Lords in Deutsche Morgan Grenfell [2007] 1 AC 558: see the speech of Lord Hope at para 44 and my own observations at paras 133 and 140. So far as Mr Jones cites any authority for his submission, he has referred, but only as an aside, to the decision of the Court of Appeal in Racal Group Services Ltd v Ashmore [1995] STC 1151. That was a claim to rectification. Rectification is a closely guarded remedy, strictly limited to some clearly established disparity between the words of a legal document, and the intentions of the parties to it. It is not concerned with consequences. So far as anything in Racal is relevant to the different equitable remedy of rescission on the ground of mistake, it is relevant, not to establishing the existence of a mistake, but to the courts discretion to withhold relief in cases where it would be inappropriate for the court to grant it. That is Mr Joness second new point and it is considered below. I would therefore reject the first new point as much too wide, and unsupported by principle or authority. But it is still necessary to consider whether there are some types of mistake about tax which should not attract relief. Tax mitigation or tax avoidance was the motive behind almost all of the Hastings Bass cases that were concerned with family trusts (as opposed to pensions trusts). In Gibbon v Mitchell there was a mistake as to the legal effect of the transaction, which was to plunge the family into the trap of forfeiture under the protective trusts, rather than to achieve the immediate acceleration of the adult childrens interests. But the seriousness of the consequences of the mistake was greatly enhanced by the inheritance tax implications. On the test proposed above, consequences (including tax consequences) are relevant to the gravity of a mistake, whether or not they are (in Lloyd LJs phrase) basic to the transaction. In Pitt the special tax advantage available under section 89 of the Inheritance Tax Act 1984 was a valuable one, and its loss was certainly a serious matter for Mrs Pitt, both as her husbands receiver and on her own account as his wife and carer and as the eventual beneficiary of his estate. Lloyd LJ accepted that (para 215). He was also prepared to accept (para 216) that Mrs Pitt had an incorrect conscious belief, or made an incorrect tacit assumption, that the proposed SNT (which had been the subject of advice from two professional firms, and approved by the Court of Protection) had no adverse tax effects. It was on the issue of mistake as to effect or as to consequence? (para 217) that Lloyd LJ felt obliged to withhold relief. He saw the tax liability, even though it was immediate and backed by a statutory charge (imposed by section 237 of the Inheritance Tax Act 1984) on the property of the SNT, as no more than a consequence (para 218): The legal effect [of the disposition] was the creation of the Special Needs Trust, on its particular terms, and the fact that the lump sum and the annuity were settled upon those terms. An irony of the situation is that if the SNT had been framed so as to comply with section 89 (requiring at least half of the property applied during Mr Pitts lifetime to be applied for his benefit) it would most probably have made no difference to the distribution of capital or income during his lifetime (as the deputy judge noted in para 13 of his judgment, in dismissing a Revenue argument that Mrs Pitt might have decided not to take advantage of section 89). It has not been suggested that the primary purpose of the SNT was other than Mr Pitts welfare and benefit, and the maintenance of his wife as his carer. The SNT could have complied with section 89 without any artificiality or abuse of the statutory relief. It was precisely the sort of trust to which Parliament intended to grant relief by section 89. In Futter this court declined to permit the appellants to raise for the first time the issue of mistake, primarily because there was no sufficient evidential basis for considering that issue for the first time on a second appeal. Gibbon v Mitchell received a passing mention in the judgment of Norris J [2010] STC 982, para 20, but only for the purpose of rejecting the Revenues argument that the distinction between effect and consequences was relevant to the Hastings Bass rule. Had mistake been raised in Futter there would have been an issue of some importance as to whether the Court should assist in extricating claimants from a tax avoidance scheme which had gone wrong. The scheme adopted by Mr Futter was by no means at the extreme of artificiality (compare for instance, that in Abacus Trust Co (Isle of Man) v NSPCC [2001] STC 1344) but it was hardly an exercise in good citizenship. In some cases of artificial tax avoidance the court might think it right to refuse relief, either on the ground that such claimants, acting on supposedly expert advice, must be taken to have accepted the risk that the scheme would prove ineffective, or on the ground that discretionary relief should be refused on grounds of public policy. Since the seminal decision of the House of Lords in WT Ramsay Ltd v IRC [1982] AC 300 there has been an increasingly strong and general recognition that artificial tax avoidance is a social evil which puts an unfair burden on the shoulders of those who do not adopt such measures. But it is unnecessary to consider that further on these appeals. Equity does not act in vain Mr Joness second new point was that Mrs Pitt should be refused relief because the granting of relief would serve no practical purpose, other than saving inheritance tax. He cited Sir Nicolas Browne Wilkinson V C in the Spycatcher case, Attorney General v Guardian Newspapers Ltd [1987] 1 WLR 1248, 1270: It is an old maxim that equity does not act in vain. To my mind that is good law and the court should not make orders which would be ineffective to achieve what they set out to do. In the event the House of Lords took a different view, by a bare majority, as to whether the continuation of the interlocutory injunctions would serve any useful purpose. The maxim exists, but as Mason CJ and McHugh J said in Corin v Patton (1990) 169 CLR 540, 557, Like other maxims of equity, it is not a specific rule or principle of law. It is a summary statement of a broad theme which underlies equitable concepts and principles. The fund subject to the SNT had many calls on its resources, with heavy professional costs and expenses as well as making provision for the welfare and care of Mr Pitt and the maintenance of his wife. On his death on 25 September 2007 there was only 6,259 in the trust (the deputy judge added, para 15, that that was on Mrs Pitts case but he had earlier stated, para 4, that the material facts were not in dispute at all). On Mr Pitts death this sum, subject to any outstanding liabilities, vested in his personal representatives under Clause 3 of the SNT. Any remaining value in the fund was therefore in the same beneficial ownership as if the SNT had been set aside by the court. On 22 November 2011, after this court had granted permission for Mrs Pitt to appeal from the Court of Appeals decision, her solicitors wrote to the Solicitors Office of the Revenue drawing attention to a submission in the Revenues skeleton argument before the Court of Appeal, para 105: But, in any event, the settlement should not be set aside after this period of time, especially when the Court does not know what proprietary claim would vest in the estate against third parties. Apparently with a view to avoiding any doubt on this point, Mrs Pitts solicitors set out the factual position as it was at that time and stated in the last paragraph of their letter: Please note that Mrs Pitt and Mr Shores [her co executor] have irrevocably instructed us to indicate, that if the Supreme Court orders that Mr Pitts settlement is set aside, no further claim (to monies or other relief), will be made by them in their capacity as Mr Pitts personal representatives, or by Mrs Pitt in her capacity as sole beneficiary of his estate, whether against the trustees (from time to time) of Mr Pitts settlement or the recipients of distributions or other payments from the trustees. Our clients will be satisfied with the effect of section 150 IHTA 1984 (consequent on the order setting aside Mr Pitts settlement). In these circumstances Mr Jones has submitted that it would be pointless, and so contrary to equitys practical approach, to grant relief that would achieve nothing, apart from a tax advantage to Mrs Pitt. He has relied on the approval by Peter Gibson LJ (with whom Sir Iain Glidewell and Kennedy LJ agreed) in Racal Group Services Ltd v Ashmore [1995] STC 1151, 1157 of what Vinelott J had said below [1994] STC 416, 425: In my judgment the principle established by these cases is that the court will make an order for the rectification of a document if satisfied that it does not give effect to the true agreement or arrangement between the parties, or to the true intention of a grantor or covenantor and if satisfied that there is an issue, capable of being contested, between the parties or between a covenantor or a grantor and the person he intended to benefit, it being irrelevant first that rectification of the document is sought or consented to by them all, and second that rectification is desired because it has beneficial fiscal consequences. On the other hand, the court will not order rectification of a document as between the parties or as between a grantor or covenantor and an intended beneficiary, if their rights will be unaffected and if the only effect of the order will be to secure a fiscal benefit. But Peter Gibson LJ went on to differ from Vinelott J in applying this principle. He held that there was an issue capable of being contested. The appeal was dismissed on another ground, that is because of the inadequacy of the evidence to satisfy the high standard of proof required for rectification. What the Court of Appeal decided in Racal was that it is sufficient, even for the closely guarded remedy of rectification, that there is a genuine issue capable of being contested, even if the parties decide that they will not in fact contest it. The test for rescission on the ground of mistake cannot be stricter than that. Until the solicitors letter of 22 November 2011 there was at least a possibility of third party claims arising, and the Revenue placed reliance on that as a reason for refusing relief. But for the letter, the Court might, if minded to grant relief, have required an undertaking to the same effect as the one that Mrs Pitt and Mr Shores have volunteered. Moreover the Revenues argument ignores the fact that unless and until the SNT is set aside, there are potentially contestable issues between the Revenue and any persons who, not being purchasers for value without notice, have received distributions from the SNT. The statutory charge under section 257 of the Inheritance Tax Act 1984 would prima facie give the Revenue a proprietary claim against such third parties. For these reasons I would reject the Revenues second new point also. The mistake claim in Pitt v Holt ground of mistake is that set out in para 126 above, and it is satisfied in Pitt v Holt. There would have been nothing artificial or abusive about Mrs Pitt establishing the SNT so as to obtain protection under section 89 of the Inheritance Tax Act 1984. There was a considerable delay in the commencement of the proceedings, but the Revenue do not rely on the delay. They do rely on rescission being pointless and therefore inappropriate, but I would reject that submission for the reasons set out above. The deputy judge found ([2010] 1 WLR 1199, para 15) that the setting aside of the settlement would have no effect on any third party (plainly he was not here treating the Revenue as a third party). I would discharge the orders below and set aside the SNT on the ground of mistake. In my opinion the test for setting aside a voluntary disposition on the

These appeals raise important and difficult issues in the field of equity and trust law. Both appeals raise issues about the so called rule in Hastings Bass, which is concerned with trustees who make decisions without having given proper consideration to relevant matters which they ought to have taken into account. In addition, the appeal in Pitt raises issues as to the courts jurisdiction to set aside a voluntary disposition on the ground of mistake. In 1985, Mr Mark Futter made two settlements. Initially, both settlements had non resident trustees, until, in 2004, he and Mr Cutbill, both resident in the United Kingdom, were appointed. In 2008, on the advice of solicitors, Mr Futter and Mr Cutbill, in exercise of a power of enlargement, distributed the whole capital of the first settlement to Mr Futter, and, in exercise of a power of advancement, distributed 36,000 from the second settlement to Mr Futters three children in equal shares. In so doing, they overlooked the effect of section 2(4) of the Taxation of Chargeable Gains Act 1992 (TCGA), which resulted in a large capital gains tax liability for Mr Futter, and a modest one for his children. Mr Futter and Mr Cutbill, as trustees of the two settlements, applied to have the deed of enlargement and the deeds of advancement declared void, which Norris J held them to be on the basis of the rule in Hastings Bass. In 1990, Mr Derek Pitt suffered very serious head injuries in a road traffic accident, resulting in his mental incapacity. Mr Pitts claim for damages for his injuries was compromised by a court approved settlement in the sum of 1.2m. Mr Pitts solicitors sought advice from Frankel Topping, a firm of financial advisers. They advised that the damages should be settled in a discretionary settlement. This was done in 1994 by the establishment of the Derek Pitt Special Needs Trust (the SNT). The SNT could have been established without any immediate inheritance tax liability, but it was not. The report from Frankel Topping made no reference whatsoever to inheritance tax. In 2007, Mr Pitt died. His personal representatives, who were also two of the trustees of the SNT, commenced proceedings to have the SNT set aside, which the deputy judge ordered on the basis of the rule in Hastings Bass. However, in so doing, he indicated that, even if there had been a mistake of any sort, it was only a mistake as to the consequences of the transaction, rather than its effect, and so he would not have granted rescission of the SNT. The Revenues appeals against these decisions were heard together in the Court of Appeal. Lloyd LJ (with whom Longmore and Mummery LJJ agreed) (i) allowed the appeals, principally on the ground that the rule in Hastings Bass was not applicable, because the respective trustees acted reasonably in reliance on what they supposed to be competent professional advice, (ii) dismissed Mrs Pitts appeal based on mistake, on the basis that rescission for mistake could only be granted if there was a serious mistake as to nature of a transaction, rather than its consequences, and a mistake as to tax consequences was not a sufficient mistake for the purposes of rescission. The Supreme Court unanimously (i) dismisses the appeal in Futter, and the appeal in Pitt, so far as they turn on the rule in Hastings Bass, (ii) allows the appeal in Pitt on the ground of mistake, and sets aside the SNT. Lord Walker gives the judgment, with which the other Justices agree. The rule in Hastings Bass The rule in Hastings Bass, properly understood, depends on breach of duty in the performance of something that is within the scope of the trustees powers, not in the trustees doing something that they had no power to do at all [43]. The rule is centred on the failure of trustees to perform their decision making function. It is that which founds the courts jurisdiction to intervene if it thinks fit to do so [91]. As a matter of principle there must be a high degree of flexibility in the range of the courts possible responses. To lay down a rigid rule would inhibit the court in seeking the best practical solution in the application of the rule in Hastings Bass in a variety of different factual situations [92]. For the rule in Hastings Bass to apply, the inadequate deliberation on the part of the trustees must be sufficiently serious as to amount to a breach of fiduciary duty. It is generally only a breach of duty on the part of the trustees that entitles the court to intervene. It is not enough to show that the trustees deliberations have fallen short of the highest possible standards, or that the court would, on a surrender of discretion by the trustees, have acted in a different way. Apart from exceptional circumstances (such as an impasse reached by honest and reasonable trustees) only breach of fiduciary duty justifies judicial intervention [73]. However, where trustees have been in breach of duty by exercising a discretion with inadequate deliberation, setting aside their decision may not be the only course open to the court [63]. It would be contrary to principle and authority to impose a form of strict liability on trustees who conscientiously obtain and follow, in making a decision which is within the scope of their powers, apparently competent professional advice which turns out to be wrong [80]. Such a result cannot be achieved by the route of attributing any fault on the part of professional advisers to the trustees as their supposed principals [81]. There have been, and no doubt will be in the future, cases in which small variations in the facts lead to surprisingly different outcomes. That is inevitable in an area where the law has to balance the need to protect beneficiaries against aberrant conduct by trustees (the policy behind the rule in Hastings Bass) with the competing interests of legal certainty, and of not imposing too stringent a test in judging trustees decision making [83]. Rescission on the ground of mistake The true requirement for rescission on the ground of mistake is simply for there to be a causative mistake of sufficient gravity. The test will normally be satisfied only when there is a mistake either as to the legal character or nature of a transaction, or as to some matter of fact or law which is basic to the transaction [122]. Consequences (including tax consequences) are relevant to the gravity of a mistake [132]. A mistake must be distinguished from mere ignorance, inadvertence, and misprediction [104]. Forgetfulness, inadvertence or ignorance is not, as such, a mistake, but it can lead to a false belief or assumption which the law will recognise as a mistake [105]. Mere ignorance, even if causative, is insufficient [108]. However, the distinctions may not be clear on the facts of a particular case [109]. In order to satisfy the test for setting aside a voluntary disposition on the ground of mistake, the gravity of the mistake must be assessed by a close examination of the facts. The injustice of leaving a mistaken disposition uncorrected must be evaluated objectively, but with an intense focus on the facts of the particular case [126]. The court must make an evaluative judgment whether it would be unconscionable, or unjust, to leave the mistake uncorrected, and form a judgment about the justice of the case [128]. Mrs Pitt had an incorrect conscious belief, or made an incorrect tacit assumption, that the proposed SNT had no adverse tax effects [133]. The SNT could have complied with statutory requirements without any artificiality or abuse of statutory relief. It was precisely the sort of trust to which Parliament intended to grant relief [134].

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