Court of Appeal Upholds Proportionality of Executive Decisions in Sanctions Cases Under Human Rights Act

Citation: [2024] EWCA Civ 172
Judgment on

Introduction

In the appeals concerning Dalston Projects Limited & Ors v Secretary of State for Transport and Shvidler v Secretary of State for Transport, the UK Court of Appeal (Civil Division) addresses critical questions on the proportionality of executive decisions under the Human Rights Act 1998 (HRA) in relation to the Sanctions and Anti-Money Laundering Act 2018 (SAMLA). The assessment relates to the Russia (Sanctions) (EU Exit) Regulations 2019 (SI 2019 No 855), exploring the limits of executive discretion and the judicial role in reviewing such decisions. This case law analysis focuses on the legal principles applied and their implications for upholding individual rights vis-à-vis public interest objectives.

Key Facts

The appeals stem from individual decisions to detain a luxury yacht (Dalston Projects case) and to designate an individual, Eugene Shvidler, for sanctions (Shvidler case). Both relate to sanctions aimed at pressuring Russia for its actions in Ukraine. The Appellants challenged these decisions on the grounds that they violated rights under A1P1 of the European Convention on Human Rights – the right to peaceful enjoyment of one’s possessions – as well as Article 8 (right to respect for private and family life). The proportionality of the executive actions and their compliance with legislation and regulatory frameworks lie at the heart of the disputes.

The Court of Appeal undertook a thorough analysis of several legal principles:

  1. The Principle of Proportionality: Central to the case is the test in Bank Mellat v HM Treasury (No 2), which considers whether a measure (1) serves a sufficiently important objective to justify limiting a protected right, (2) is rationally connected to the objective, (3) could be achieved by a less intrusive measure, and (4) strikes a fair balance between rights and societal interests.

  2. Judicial Review and Appeal Principles: Importantly, in In re B (A Child) (Care Proceedings: Threshold Criteria), the court’s appellate function is clarified as a review rather than a rehearing, with a decision being wrong as a sufficient condition for allowing an appeal. The appellate court must respect the trial judge’s findings of fact, particularly if they are based on the assessment of witness credibility or likely future conduct.

  3. Standard of Review: The Court distinguished between the different standards of review at the appellate level, rejecting the notion that it should defer to the lower court’s assessment unless it was unreasonable or outside the range of possible outcomes.

  4. Discrimination: Although not explicitly addressed due to the refusal of permission to appeal on this ground, the concept of discrimination under Article 14 and its relevance to the proportionality assessment is acknowledged.

  5. Human Rights Act 1998 (HRA): The court emphasized that it is the substantial question of whether there has been a violation of Convention rights that matters, not the quality of the decision-making process.

Outcomes

In both cases, the Court of Appeal dismissed the appeals. It found that:

  • In Dalston Projects, the executive’s decision to detain the yacht, although having significant implications for the Appellants, was proportionate given the higher public interest grounds.
  • In Shvidler, the designation of the Appellant, while severe, had a rational connection to the legitimate aim and did not impose an excessive or disproportionate burden.

It was acknowledged that the measures were both grave and indeterminate. Still, they were necessary within the larger context of international sanctions and efforts to change the actions and policies of the Russian government.

Conclusion

The Court of Appeal’s decisions affirm the breadth of the executive’s discretion in matters involving international relations and sanctions while simultaneously reinforcing the judiciary’s crucial role in ensuring proportionality and the protection of human rights. The Court’s considerations elucidate the balance between individual rights and public interest, particularly in the complex and politically sensitive context of international sanctions. These judgments reinforce the consistency and robustness of legal principles applied to review executive decisions affecting individual rights under HRA and SAMLA, ensuring that these decisions remain within the boundaries of the law and that individual liberties are protected even in the face of pressing public concerns.