R (on the application of Lumsdon) v Legal Services Board

The Supreme Court has handed down an important decision on the application of the principle of proportionality in EU law, disapproving Sinclair Collis [2011] EWCA Civ 437 and redefining the parameters of judicial review in the EU law context.

The Appellants (four criminal barristers) sought to challenge by way of judicial review the decision of the Legal Services Board to grant the Bar Standards Board’s application for approval of alterations to its regulatory arrangements to introduce the controversial Quality Assurance Scheme for Advocates (QASA). QASA seeks to assure the quality of criminal advocacy in England and Wales through evaluation of all criminal advocates by the judges hearing the cases in which they appear.

The appeal to the Supreme Court concerned the effect of Regulation 14 of the Provision of Services Regulations 2009/2999 (implementing the Services Directive (2006/123/EC), which provides that a competent authority must not make access to, or exercise of, a service activity subject to an ‘authorisation scheme’ unless certain conditions are satisfied. The Appellants argued that regulation 14(2) required the court to assess the proportionality of the scheme itself, and that the Court of Appeal had been wrong to assess only whether the decision to approve the scheme was “manifestly inappropriate”. The Appellants maintained that the scheme failed to meet the conditions in regulation 14(2)(b) and (c).

The Supreme Court undertook a comprehensive analysis of the principle of proportionality in EU law, distinguishing between cases involving (1) the review of legislative and administrative measures adopted by EU institutions; (2) the review of national measures relying on derogations from general EU rights and; (3) the review of national measures implementing EU law. The Court stressed the importance of national judges understanding the rationale behind the differences in the application and formulation of the principle and the importance of identifying the relevant precedents in each case. In summary, the Supreme Court held:
• That in reviewing EU measures where an EU institution has exercised political, economic or social discretion, the court will usually only intervene if it considers that the measure adopted by the legislature is “manifestly inappropriate”;
• That, by contrast, in the review of national measures derogating from the fundamental freedoms, the approach should be that as identified in Gebhard and the court will tend to examine closely the justification for the restriction and whether there are other measures which could have been equally effective but less restrictive. However, where a national measure does not threaten the integration of the internal market – for example where the subject matter lies within the area of national competence, e.g. gambling – the court will apply a less strict approach;
• That, where the court is reviewing a national measure which implements an EU measure, to the extent that the directive requires the national authority to exercise political, social or economic choices, the court will be slow to interfere with that evaluation: the court will use a “manifestly disproportionate” test. However, where the member state relies on a derogation or reservation in a directive to implement a measure restrictive of one of the fundamental freedoms, the measure will be scrutinised in the same way as other national measures which are restrictive of those freedoms.

The Court also confirmed that the principle of proportionality in EU law is not expressed or applied in the same way as the principle of proportionality under the ECHR: the four-stage test in Bank Mellat v Her Majesty’s Treasury (No 2) [2013] UKSC 39 does not apply when assessing proportionality in EU law.

In the light of their analysis the Supreme Court concluded that the Court of Appeal in R (Sinclair Collis Ltd) v Secretary of State for Health [2011] EWCA Civ 437 had been wrong to apply the “manifestly inappropriate” test, the case being one concerning restriction of the fundamental freedoms.

As such, the Court agreed with the Appellants that the Court of Appeal in the instant case was wrong to approach proportionality using a “manifest error” or “manifestly inappropriate test” and that instead it was for the court to decide whether the scheme was disproportionate – “the court must apply the principle of proportionality and reach its own conclusion”, approaching the matter in the way in which the Court of Justice would approach the issue in enforcement proceedings.

Ultimately, in analysing the proportionality of the LSB’s decision the Supreme Court concluded that the question of whether a comprehensive, precautionary scheme such as QASA was required was the kind of question about which the national decision maker is allowed to exercise its judgment within a margin of appreciation, concluding that “Since the only way of reducing the risk, so as to provide the desired level of protection for all members of the public involved in criminal proceedings at an upper level, was to have a scheme of the kind proposed by JAG [the Joint Advocacy Group, including the BSB], it follows that the scheme was proportionate to the objective, notwithstanding the inconvenience caused to competent members of the profession”. The appeal was therefore dismissed.

The full decision can be read here: https://www.supremecourt.uk/cases/docs/uksc-2014-0272-judgment.pdf

Tom de la Mare QC, Tom Richards and Jana Sadler-Forster of Blackstone Chambers and Mark Trafford QC of 23 Essex Court appeared for the Appellants instructed by Baker & McKenzie, all acting pro bono.