The Secretary of State for the Home Department v R (on the application of) Joint Council for The Welfare of Immigrants (2020) EWCA Civ 542
The Court of Appeal have their way with the judicial review of the ‘Right to Rent’ scheme. This was the Secretary of State’s appeal of the remarkable first instance judgment which had found the scheme to be incompatible with Art 14 with Art 8 (our note here). (For transparency, I acted for the Residential Landlords Association on their intervention in both the High Court and Court of Appeal.)
The short version – the appeal was allowed in full. However, the longer version shows a more nuanced (and unagreed) view.
The Secretary of State appealed on the following grounds:
Ground 1: The judge erred in holding that the Scheme and/or the facts of this case fall within the ambit of article 8 for the purposes of article 14. The Joint Council cross-appeal on the ground that, whilst the judge was right to hold that the facts of this case as he found them to be fall within such ambit, he was wrong to conclude that they do not fall within the scope of article 8 such that, in addition to an interference with article 14, there is a direct interference with article 8 rights which requires justification by the state. Like the discrimination under article 14, it is submitted that the interference with the article 8 rights is not justified.
Ground 2: The judge erred in finding that, on the evidence, the Scheme results in discrimination on grounds of nationality and/or ethnicity; or, alternatively, in not making an adequate assessment of the discrimination so caused.
Ground 3: The judge erred in holding that the state, in the form of the Secretary of State, is responsible for any such discrimination.
Ground 4: The judge erred in concluding that any discriminatory effects of the Scheme are not justified as a proportionate means of achieving a legitimate aim.
Ground 5: Even if the Scheme falls within the ambit of article 8 and results in unjustified discriminatory effects for which the Secretary of State is responsible, and thus is in breach of article 14, the judge erred in granting a declaration of incompatibility in respect of the whole scheme.
Ground 6: He was also wrong to make a declaration that, without further evaluation of the efficacy and discriminatory effect of the Scheme, the extension of the Scheme to the other home nations would be irrational and a breach of the PSED.
The 2:1 majority judgment of the Court of Appeal found as follows (we’ll come back to the other judgment below):
Ground 1 – ‘Ambit of Article 8’
The majority of the Court of Appeal were firm that, as at first instance, the facts of the case did not fall within the scope of Article 8. However, any decision whether they fell within the ‘ambit’ of article 8 for the purposes of an article 14 claim was much more challenging. In fact, so challenging that after an extensive review of the Strasbourg and national case law, the majority preferred not to actually decide it (see paras 82-111)
it seems to me that, on balance, the ECtHR authorities suggest that the facts of this case might well fall within the ambit of article 8 and Strasbourg has produced few cases in which an article 14 claim has failed because the facts have been held to have fallen outside the ambit of a substantive right (although Botta v Italy (ECtHR Application No 21439/93) (1998) 26 EHRR 241, which concerned access to private beaches, was one such). Because of my firm conclusion in relation to justification (see paragraphs 112 and following below), it is unnecessary to express a conclusion on the ambit issue, and I prefer not to do so. In my view, that is an issue which can more appropriately be considered in a case where it is determinative.
For those reasons, I shall proceed on the assumption, in the Joint Council’s favour, that, whilst not falling within the scope of article 8, the facts of this case fall within its ambit.
Grounds 2 and 3 – ‘Causation’
The Court of Appeal did not accept that the evidence on the discriminatory effect of the right to rent scheme was as strong as had been held at first instance. While many of the Secretary of State’s challenges to the survey evidence from JCWI, RLA and Shelter were not all ‘particularly compelling’, some had accuracy. So, for example, one could not go so far as to suggest that there were people with a right to rent who could not get accommodation because of the scheme:
As the judge himself indicated, the evidence does not suggest that it is impossible for even those against whom landlords discriminate to get private housing at all. Whilst any discrimination on the basis of status is to be decried, the level of discrimination supported by the evidence here must not be inflated. The evidence from the RLA landlord surveys in 2017 and 2018, was that, in the first 30 months of the Scheme being in operation, 5-6% landlords in practice discriminated in the manner suggested in this claim. Even as to likely intent, the evidence from the Joint Council’s own initial survey was that 42% of landlords said that the right to rent requirements had made them less likely to consider someone who does not have a British passport, and 27% said they were reluctant to engage with those with foreign accents or names (see paragraph 30 above). The other surveys (except that of the Ministry of Housing, where the percentage was significantly lower at 25%: see paragraph 43 above) appear to be broadly in line with those figures. However, even on the basis of the figures derived from the evidence most advantageous to the Joint Council’s case (and leaving aside any discount for the statistical weaknesses in the data), just over half of private landlords do not discriminate in any way. Nearly half being guilty of discrimination is, of course, a high proportion – it is shocking – but it means that a potential tenant in the category most discriminated against (no British passport, and no ethically-British attributes) will on average take no longer than twice the time to obtain a tenancy as it would take someone with a British passport. Whilst, of course, some potential tenants will be unfortunate and take longer than the average time, the evidence cannot support the contention that there are potential tenants who will never obtain private accommodation.
The Court of Appeal was also not happy with the idea that effective discrimination was a rational response by landlords to the scheme (both in time pressures and in avoiding the severe penalties for letting to those without a right to rent).
I cannot accept the concept of an individual acting “rationally” or “logically” by taking a course of action which, whilst being in his own interests, is to his knowledge discriminatory and unlawful. As Ms Kaufmann rightly stressed – as did Martin Spencer J (see [1] of his judgment) – discrimination on the basis of any protected characteristic is insidious, and on the basis of such sensitive core attributes such as sex, sexual orientation or race is a particular anathema. Whilst discrimination by landlords on the basis of nationality and/or race as a result of the administrative burdens and enforcement provisions imposed on them by the Scheme may have been foreseeable, or even inevitable (as Ms Kaufmann submitted), I simply do not see how it can be properly be described as “rational” or “logical”.
However, the Court of Appeal (the majority at least), accepted that there was discrimination as a result of the right to rent scheme:
Despite the criticisms made on behalf of the Secretary of State and my observations above, on the basis of all the evidence, I am satisfied that, as a result of the Scheme, some landlords do discriminate against potential tenants who do not have British passports, and particularly those who have neither such passports nor ethnically-British attributes such as name. By “as a result of the Scheme”, I mean that, but for the Scheme, the level of discrimination would be less. Almost all of the evidence – notably the evidence from mystery shopping exercises and surveys – points clearly in that direction.
But the extent of that discrimination ‘must be kept in perspective’, which went to justification.
Ground 4 – Justification
The only issue on justification was “whether, balancing the severity of the measure’s effects on the rights of the persons to whom it applies against the importance of the objective, to the extent that the measure will contribute to its achievement, the former outweighs the latter.”
Firstly, legislation will not be unjustified “unless it is incapable of being operated in a proportionate way in all or nearly all cases.”
But the test (see paras 125-134) should properly be the “manifestly without reasonable foundation” test, which was not restricted to welfare benefit cases:
For those reasons, if I were required to determine the matter, I would say that the manifestly without reasonable foundation criterion applies to the issue of justification in this case. Whilst I have come to that conclusion on the basis of only the arguments and authorities to which we were referred, I note that, in a judgment handed down since the hearing of this case, a different constitution of this court has also concluded that the manifestly without reasonable foundation test applies when the impugned measure is, not welfare benefits, but another area of socio-economic policy
But this did not in the end need to be decided, as the ‘manifestly without reasonable foundation’ test and proportionality should reach the same result
Properly construed, in my view, the criterion cannot simply apply to some cases where there is an issue of justification in respect of a measure involving an element of social or economic policy separated from other cases by a bright line. No such line can sensibly be drawn: the degree of social and economic policy involved in any measure will be infinitely variable. In my view, the criterion simply recognises that, where there is a substantial degree of economic and/or social policy involved in a measure, the degree of deference to the assessment of the democratically-elected or -accountable body that enacts the measure must be accorded great weight because of the wide margin of judgment they have in such matters. The greater the element of economic and/or social policy involved, the greater the margin of judgment and the greater the deference that should be afforded. That is, for obvious reasons, particularly so when that body is Parliament. However, if the measure involves adverse discriminatory effects, that will reduce the margin of judgment and thus the degree of deference. That will be particularly so where the ground of discrimination concerns a core attribute such as sex or race.
In this case, the right to rent scheme was justified (paras 143-150):
Whilst discrimination in all its forms is, of course, abhorrent:
i) The Scheme does not intend, encourage or directly create discrimination. Indeed, far from it. The discrimination is entirely coincidental, in that the measure does not unlawfully discriminate against the target group but only collaterally because, in implementing the Scheme, as a result of the checks required by the Scheme and the possible sanctions for letting to irregular immigrants, landlords engage in direct discrimination on grounds of nationality; and section 33 and the Discrimination Code of Practice clearly recognise and seek to address that discrimination by landlords.
ii) Although the Scheme requires them to perform checks on whether potential tenants are disqualified from occupying premises under an RTA (because they are irregular immigrants), that does not make landlords agents of the state for these purposes: they engage in discrimination in implementing a statutory scheme as private citizens (cf cases such as DH and R (European Roma Rights Centre) v Immigration Officer at Prague Airport [2004] UKHL 55; [2005] 2 AC 1, in which officers of the state operated a statutory scheme in a discriminatory manner). Whilst, speaking for myself, I am prepared to accept that a statutory scheme may be discriminatory because it results in discrimination by private citizens in its implementation, that is subject to (i) the (very substantial) caveat that the operation of the scheme must give rise to disproportionate interference in all cases (see paragraph 116-119 above) and (ii) in any event, the fact that the discrimination arises from the operation of a statutory scheme by private individuals is relevant to the justification balancing exercise.
iii) Whilst I do not suggest that this is a point of any great force, although the evidence is that, in respect of potential tenants who do not have a British passport, landlords effectively use ethnic proxies for nationality, the primary ground of discrimination is nationality not race.
iv) As Humphreys confirms (quoted at paragraph 129 above), even where discrimination is on the basis of a core attribute such as sex or race, great weight still has to be afforded to the assessment of Parliament in respect of a measure which implements economic or social policy, and its assessment that such discrimination is proportionate to the legitimate aim of the measure.
Landlords discriminate against those who do not have British passports as a result of administrative convenience and a fear of the consequences of letting to an irregular immigrant. However:
i) As I have described, the administration involved is not burdensome: it requires the checking and copying of one (or, at most, two) identity documents, estimated to take 20 minutes or so, albeit in respect of all potential occupiers and on possibly multiple occasions for those without permanent leave to remain. For those without documents to which the Landlord Checking Scheme applies, it requires a check which will take no more than two days.
ii) Employers have similar obligations in respect of employees, and appear to cope without difficulty and apparently without discrimination. Ms Kaufmann sought to distinguish the profiles of landlords and employers, but it is difficult to do so without evidence: whilst the evidence is that many landlords have only one property, there are many employers with one or only a few employees.
iii) The evidence is that many – most – landlords comply with the administrative requirements without discriminating. As I have said, it is unknown why all cannot do so. Those who do not comply not only engage in unlawful discrimination contrary to the Equality Act 2010, they have an unfair commercial advantage over the majority who do.
iv) Enforcement of the Scheme, and the Equality Act obligations, is essentially also a matter for Parliament. Ms Kaufmann submits that, compared with the potential sanctions for letting to irregular immigrants, sanctions for breaching the duty not to discriminate under the Equality Act are ineffective: a “rational” landlord will act defensively, and prefer to favour potential tenants with British passports (even if discriminatory) because it is very unlikely that any action will be taken in respect of the discrimination. However, Parliament has determined that the Equality Act obligations are enforceable through the county court. If individual potential tenants cannot realistically take such proceedings, the Commission is able to step in.
The nature and level of discrimination is also a relevant factor. I have dealt with this above (paragraphs 76-79). In short, the best evidence of discrimination which has in fact taken place comes from the RLA surveys, which suggest that, over the first 30 months, 5-6% of landlords discriminated against potential tenants who did not have British passports. The evidence of likely intent produces a figure of over 40%. That discrimination will cause delay for some regular immigrants who seek accommodation in the private rental market. However, they do not necessarily become homeless: the most vulnerable may be entitled to some assistance (e.g.) under the Housing Act 1996.
As a result of this finding, grounds 5 and 6 on relief fell away.
Appeal allowed.
The minority, Lord Davis, also allowed the appeal, but on the basis that the claim was not within the ambit of article 8, there was not much discrimination, but any discrimination that there was was the fault of landlords not following the law and being discriminatory. After all there was the penalty of a potential Equality Act 2010 claim if they did discriminate.
This appeared to be an attack on the scheme as a whole, not just on behalf of those who had the right to rent but had difficulty in evidencing it.
Comment
I think it is fair to say that Lord Davis disapproved of the claim, and didn’t believe that in the real world, people would take short cuts where the balance of risk and reward was heavily on one side.
On the main judgment, I understand that permission will be sought for an appeal to the Supreme Court.