European Union (Withdrawal) Bill

Lord Goldsmith Excerpts

Committee: 4th sitting (Hansard - continued): House of Lords
Monday 5th March 2018 Lords Chamber

[Lord Pannick]

The noble and learned Lord is absolutely right. If retained EU law were to be categorised as primary legislation, such challenges could not be brought. But the Minister resisted that suggestion in our earlier debate. I am concerned with the Bill as it is at the moment. What is the Government’s intention in this respect?

[Lord Goldsmith (Lab)]

My Lords, that short exchange has demonstrated how complicated this area is and how important the general principles of EU law are in it. It is, perhaps, late at night to be discussing this but it is extremely important because of both the principles and the way they operate. If one looks at it in this way, and takes the Government’s intention not to take away rights as a part of this process, one has to recognise that the architecture which provides rights at the moment is quite complicated. As a commentator has said, there is no single, simple answer to restoring the position in the light of what the Government propose to do.

Amendment 41, which stands in my name, follows the principle the noble Baroness, Lady Bowles, initiated by saying that the general principles of EU law should continue to be capable of giving rise to rights which can be enforced by our courts. The point has already been made that there is a difference between these general rights existing as a way of interpreting other rights—as an interpretive technique—and giving rise to freestanding rights themselves. Paragraph 3 of Schedule 1 prevents any action being founded in contravention of one of the general principles or rendering any Executive act unlawful or disapplying any legislation, including secondary legislation, on the grounds that it offends these general principles.

The general principles of EU law have been critical to a number of legal decisions relating to people’s rights. One of those often cited is the case of John Walker, who brought a case for equal protection in pension rights for his same-sex partner, a claim upheld by the Supreme Court which recognised that prohibition of discrimination on the grounds of sexual orientation was a key principle of EU law. As I apprehend it, without that the case would not have succeeded.

The principle of effectiveness of remedies has also been relied upon. When the Supreme Court struck down employment tribunal fees that disproportionately affected disadvantaged women and low-paid workers, the principle of effectiveness of remedies was relied upon. Cases concerning caps on compensation and equal pay cases have depended upon the general principle that we find in the EU principles. The amendment standing in my name and that of the noble Baroness, Lady Bowles, seeks to enable those general principles to continue to have that effect in our law. It is important that they do for a couple of other reasons. Take, for example, something that was raised in the other place. What if there is a principle of EU retained law which is deficient, defective, does not operate properly or is disproportionate? Without being able to rely upon the general principles of EU law, it may be that all the court could do if faced with that would be to say that either that principle or that particular Act or that particular piece of law, though deficient or defective, has to continue to operate because there is no principle by which it can be struck down, and that would be a loss.

The other reason goes back, I am afraid, to the debate that we had last week on the charter and the Government’s assertion that the charter is not necessary because all the rights are otherwise protected under our law. Of course, at the time the charter was drawn up we were still a member and, in many people’s minds at least, were expected to continue to remain a member of the European Union with all that that implied, including the continued application of general principles. But if one looks—

[Lord Faulks]

My Lords—

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[Lord Goldsmith]

If the noble Lord will allow me to make this point, he can then, of course, intervene. If one looks, as we did briefly last week, at the reasons given by the Government in their right by right analysis for why certain rights would, according to them, continue to exist, we see—I take this from the JCHR’s analysis—that 16 out of 50 of the rights are based, in part at least, on the general principles of EU law. If the general principles of EU law have no more value than as an interpretive tool, that principle would disappear. That means that those rights that the JCHR saw could continue to exist and give rise to rights only because of the general EU rights.

[Lord Faulks]

When we were having the debate about the charter, I specifically asked the noble and learned Lord whether principles which were referred to in the charter were actionable or not, and he said that in his contention, they were not actionable. I am not simply trying to make some forensic point, but I seek clarity from him as to why in that context he said that the principles were not actionable—I can well understand his answer, because principles are rather difficult to identify as regards a clear breach, for example—but he now says that the Bill is wrong and that principles should somehow be actionable.

[Lord Goldsmith]

I am grateful for the question, because it enables me to clarify that point. There are two sorts of principles. I was talking in answer to the noble Lord’s question last week about the principles which are contained in the charter itself. The charter says that it is a charter of rights and principles, and the principles there—it is not that easy to identify which are principles and which are not—are not actionable in themselves. They may become actionable, because as they are aspirational tools, they are then implemented into law and are actionable at that stage. The principles we are talking about here are different. These are the general principles of EU law, which are, for example, the principle of legal certainty, the principle of proportionality, and the principle of non-discrimination. These are different in that sense; they are general rather than specific principles, and they are actionable at the moment. That is why the Walker case I mentioned gives rise to a remedy, as did the other cases where the Supreme Court struck down tribunal fees as being disproportionately high for particular categories of workers.

That is why we believe it is important to keep this. It is one element of the architecture to retain rights. I remind noble Lords that the Prime Minister made it clear that the intention was that rights would continue the same the day after exit as the day before. To remove general principles in this way, and the ability to rely upon them, will fail to keep that promise. This amendment also—it has been referred to already—specifically proposes that the general principles of EU law should include those which are contained in Article 191 of the Treaty on the Functioning of the European Union. Those are environmental principles of huge importance: the precautionary principle, the principle of polluter pays and the principle for preventive action. Those principles and the others I referred to need to continue to operate to keep in place the rights that people enjoy at the moment.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, I thank noble Lords for their brevity.

Amendment 40ZA, in the name of the noble Baroness, Lady Bowles, seeks to ensure that challenges to validity could continue on general principles of EU law grounds. I will address concerns raised on general principles in more detail later. First, Schedule 1 generally ends the ability to bring challenges on validity grounds to what will become retained EU law after we leave the EU. We recognise, however, that in some circumstances, individuals and businesses may be individually affected by an EU instrument. For example, a decision of an EU institution or body may be addressed directly to an individual or business. After exit, they would continue to be able to challenge such decisions—in so far as they apply in the EU—before the CJEU, and to have them annulled. Of course, the converted form of the decision would however remain in force within the UK as retained EU law.

The noble Lord, Lord Pannick, asked whether paragraph 1 of Schedule 1 would, after exit day, prevent a challenge to a provision of retained EU law by reference to common-law principles. I understand that the answer is no, it would not, and it is not intended to do so. I hope that that meets the position that he raised with me a moment ago.

Domestic courts currently have no jurisdiction to annul an EU measure or declare it invalid, and we do not believe it would be right to hand them a new jurisdiction which asks them effectively to assume the role of the CJEU in this context. This amendment would effectively ask our courts to consider whether the EU acted incompatibly with the general principles when it made an EU instrument. Generally speaking, this is a function that we do not consider it appropriate to confer on domestic courts.

Therefore, although I appreciate the points raised by the noble Baroness, the amendment would undermine the Government’s stated policy of a clear exclusion of both validity challenges and general principle challenges provided for within Schedule 1. However, we recognise that there might be some limited circumstances in which it would be sensible to maintain the ability to challenge retained EU law on validity grounds. The Bill therefore contains a power set out in paragraph 1(2)(b) of Schedule 1, to which the noble Baroness alluded, which would enable the Minister to make regulations providing for a right of challenge in domestic law to the validity of retained EU law in specified circumstances.

Sub-paragraph (3) sets out that those regulations may provide that a challenge which would previously have proceeded against an EU institution may, after exit, proceed against a UK public authority, because of course there would be no EU institution against which it could be directed. I seek to reassure the noble Baroness that the word “may” is there as a precautionary term lest, in the context of trying to make such a regulatory power, it be perceived that there is no easily identifiable body against which the matter can be directed. However, the intent is that it should be possible to proceed against a public body in those circumstances.

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[Lord Keen of Elie]

I fully acknowledge that that is most certainly a circumstance that could arise. Of course, one might address that circumstance by Parliament legislating to reflect the outcome of that post-Brexit decision. However, I fully acknowledge that, depending on the way in which one constructs the departure on exit day, one might find that what one has retained as EU law ceases to be EU law almost immediately after one has left the EU. I believe that that has been acknowledged on a number of occasions. Indeed, it could lead to the development of two parallel jurisprudences—one for retained EU law and one for EU law. That is an inevitable outcome of our decision to leave the EU but to retain in our domestic law that which was EU law at the point of our departure. I fully acknowledge that, but it might also be a circumstance in which potentially one would seek to exercise the exceptional regulatory power that is referred to.

Reference was made to Amendments 41 and 42, tabled by the noble and learned Lord, Lord Goldsmith, and the noble Lord, Lord Foulkes, which seek to retain indefinitely in domestic law rights of challenge based on the general principles of EU law. If agreed to, these amendments would empower domestic courts to quash administrative actions or secondary legislation or, indeed, even go as far as disapplying an Act of Parliament on the ground that it breaches one or more of the retained general principles of EU law—that could take place long after we have left the EU. That is why we have to have a point in time at which we have certainty as to the scope for such challenges, and that is reflected in the schedule.

As the noble and learned Lord, Lord Goldsmith, acknowledged, Amendment 41 would go even further. It seeks to set out an ostensibly broader definition of which general principles are to be retained under the Bill. In that context, he alluded to Article 191 of the TFEU, which deals with environmental issues. I take issue with him as to whether the polluter pays principle and the precautionary principle are both now accepted as general principles of EU law. I would suggest that there is considerable doubt as to whether the former, in particular, constitutes what is recognised in EU law as a general principle, so I have some difficulty with that amendment.

I come now to Amendment 63, also tabled by the noble Baroness, Lady Bowles. It is, I apprehend, intended to retain this right of challenge but solely for the principle of proportionality, as she indicated, and specifically including where retained EU law is to be treated as primary legislation. It would also appear to permit the possibility of a challenge on the basis of invalidity of EU law, as well as judicial review of such legislation. It is our position that the general principles of EU law, such as proportionality, non-retroactivity and fundamental rights, will be kept in our domestic law, but in order to assist in interpreting retained EU law and not to give rise to additional stand-alone rights. Whereas some general principles are now set out expressly in EU treaties, the general principles were those that were first recognised by the European Court of Justice. They are essentially judge-made and determined as principles on the basis of case law. It is those principles that we are dealing with.

I come back for a moment to Amendment 41, which goes beyond just the issue of proportionality. It would undermine the approach that we are seeking to take if we were to pursue it. In particular the inclusion of Article 191 in the amendment risks going further than the existing principles that are, as I say, set out in EU law and consequently in UK law today.

[Lord Goldsmith]

Leaving aside Article 191—we can argue about that and there is a decision that appears to demonstrate the point: the case of Artegodan, where the court appeared to be willing to extrapolate from the precautionary principle a general principle of EU law—does the Minister accept that, so far as the other general principles of EU law are concerned, to exclude them from the ability to found a cause of action and not just be an interpretative tool would be a diminution of the rights that people currently have and would include a diminution of many of the rights that the Government are saying are already protected under English law?

[Baroness Ludford]

So that the Minister does not have to bob up and down, may I also ask him a question? He talked about our approach in this Bill. That leads me to reflect on how far the approach in this Bill fits, for instance, the Prime Minister’s speech on Friday, in which she envisaged not only strong commitments in the area of trading goods but binding commitments in competition law. The noble and learned Lord talked earlier about how there would be EU law and then retained EU law in this country, the interpretation of which could diverge. How will the Prime Minister’s commitment to binding commitments in some areas to stay fully aligned with EU law be reflected in this construction of the Bill? If we diverge, would we then have to have domestic legislation to bring us back on track with the EU?

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[Lord Keen of Elie]

They will have rights but they may not have the same remedy, but that is quite distinct. We are talking about maintaining rights at the point when we leave.

[Lord Goldsmith (Lab)]

Does the noble and learned Lord accept that Mr Walker would not have the same rights? Those are rights purely based upon EU general principles and nothing else. Does he not accept that in that case, at least, the rights would not be there?

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[Lord Leigh of Hurley (Con)]

My Lords, I spoke on this subject at Second Reading in respect of the disputes that arose under the old regime which seem to me to deserve fair treatment. I am aware of instances, in particular relating to small businesses, where it could lead to a very unfair result and deprive genuine claimants of going to the EU courts. The noble Lord, Lord Foster of Bath, mentioned the note by James Segan, and it raises a question which perhaps my noble and learned friend can answer about whether as it currently stands with paragraph 27 of Schedule 8, which was mentioned, and Section 16 of the Interpretation Act 1978, there could be action under the Human Rights Act. It would be politically unacceptable, apart from anything else, to see claimants pursuing their claims if there were that interpretation.

[Lord Goldsmith]

My Lords, I look forward to the answers that the Minister will give to the questions asked by the noble Lord, Lord Pannick. I have Amendment 44 which deals with the timing of the Francovich claim. I can be brief. My noble friend Lord Davies of Stamford set out very well what we are talking about. The noble Lord, Lord Carlile, indicated the problems to which the Government’s approach gives rise. One can look at it this way: at the moment the Bill appears to say that if the Government were to commit an act that was unlawful—a breach of Union law, for example—before exit day, the Francovich claim could not be brought, except in circumstances where the claim had been brought before exit day. I do not see the justification for that. That amounts to whitewashing an unlawful act and, as has been said—and it seems to me to be absolutely right—it is quite inconsistent with the promise that has been made that we will have the same rights the day after exit day as the day before.

I look forward to the answers to those questions. Even if any change does not go as far as my noble friend Lord Davies of Stamford, said, it must at least apply, as the noble Lord, Lord Carlile, put it, to accrued rights, so that any act which is committed before exit day which gives rise to a Francovich claim should continue to do so.

[Lord Keen of Elie]

My Lords, I am obliged. Reference has been made to the Francovich principle. I am not sure there is such a principle, although there is the issue of Francovich damages, which arises from the case that was referred to in 1991. In order to put that into context, since 1991, and in the 20 years following, there have been 22—possibly up to 25—claims for Francovich damages in the UK courts. This is not some wide-ranging citizen or business right for the recovery of damages. There have been very few actual Francovich damages claims. I see the noble and learned Lord, Lord Goldsmith, shaking his head, but I invite him to study the case law.

[Lord Goldsmith]

I have no doubt about what the noble and learned Lord says. So why are they so worried about keeping it?

[Lord Keen of Elie]

I am just about to come on to that. I am obliged to the noble and learned Lord for his patience in that respect, and will endeavour to deal with matters as swiftly as I can, given the hour. The noble Lord, Lord Carlile, very correctly, pointed out the criteria that apply in determining whether or not there is a claim for Francovich damages: first, that the relevant provision of European Union law was intended to confer rights; secondly, that there has been a serious failure to implement European Union law; and thirdly, that there is a direct causal link between that failure and the loss complained of. I would not go so far as to suggest that Francovich damages are in some sense more generous than those available otherwise under the common law in this country, particularly those available in the context of judicial review. I have to point out to the noble Lord, Lord Davies, that damages are potentially available in a claim for judicial review.

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[Lord Keen of Elie]

I wonder whether the noble Lord could exercise a small degree of patience while I just complete what I have to say on this topic. But we can take as long as it takes. As I was saying, in terms of paragraph 4 of Schedule 1, the right in domestic law to damages in accordance with the rule in Francovich is removed as at exit date. There is of course a proviso in paragraph 27 of Schedule 8 in respect of claims for Francovich damages which have already been raised prior to exit date—the point that the noble and learned Lord, Lord Goldsmith, made. The potential lacuna is this: there may be accrued rights as at exit date where no claim has been made. We recognise that and it was noted in the other place. We are open to addressing that issue in order to ensure that those accrued rights are not removed by the application of paragraph 4 of Schedule 1. That is something that we are prepared to look at, as I have indicated, because we are aware of the criticism that has been made about the potential removal of rights that have already accrued as at the exit date.

[Lord Goldsmith]

Do I take it from that that the Minister will be bringing forward an amendment to correct this?

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[Lord Davies of Stamford]

My Lords, I am grateful to everybody who has taken part in this interesting debate. I think that anybody listening in from outside will be impressed that we are working hard on a very serious matter at quarter to one in the morning.

[Lord Goldsmith]

And not drinking cocoa.

[Lord Davies of Stamford]

Yes, not drinking cocoa, indeed—absolutely right.

First of all, I must say that the noble and learned Lord, Lord Keen, has misunderstood a number of things. One is that I think he has got it wrong on the issue of damages. The noble Lord, Lord Pannick, is representative in what he said of the great majority of legal opinion on this subject and of the experience that any of us have had—via our constituents or otherwise—in this area of the law.

The second thing is that I think the noble and learned Lord has misunderstood that the major part of the importance of the Francovich system or jurisprudence is that it is a potential deterrent to those who might be inclined to misgovern us. People know that they are subject to this particular sanction if they do, and that has enormous effect. The fact that the power is used 25 times is not negligible—28 times I think it is in this country and 300 and something times over the Union as a whole. That does not mean to say that it is without effect, or that its effect is limited to those occasions. It would be very naive to say that; its effect is created by the presence of that particular sanction and means of redress for those who have been wronged in this way.

I also do not think that the noble and learned Lord is right in saying that the whole matter of Francovich is not very important because it applies only when there are serious issues. The principle of—to put it in language that I think he will understand—de minimis non curat lex—applies to everything really, in the Roman law tradition anyway. So it is not at all surprising that it applies in this case.

I want to leave the Committee with complete clarity about this, and there are three separate issues here. One is what we do about people who have a claim, or think they have a claim, under the Francovich principle—and I continue to call it that—and it is overtaken by events because they have not litigated before Brexit or they are half way through or they have not expressed their claim or put it in at all. What happens about them? That is important, because it may only be three or four people, and we should always be concerned about justice for anybody. I do not in any way denigrate people who have taken up a lot of time to talk about their particular subject; it is a perfectly respectable concern to have. But my concern is not really with that—mine is to my mind much more significant. Going forward, do we have the Francovich principle or something like it in our own legal system, both to enshrine that principle that the state is subject to the law like everybody else, which as I say is so important, and to make sure that we have that instrument of good government, which has a real deterrent effect on the behaviour of central and local government, public corporations and, indeed, the private sector? That is very important to me.

I disagree very strongly with the noble and learned Lord, Lord Keen, when he says that the Francovich system does not make any sense when we have left the European Union, because there will not be such a thing as European law here. He is quite wrong about that; there will be retained law for decades, no doubt, until it is changed by statute—if it is changed by statute over that time. It is called retained law; it is exactly the same law. The difference may be that, whereas you could litigate under it before Brexit, after Brexit you will not be able to litigate under it at all, which seems completely unreasonable. That means the loss of remedies and rights that we currently have in respect of exactly the same laws, because they are exactly the same provisions with exactly the same wording having exactly the same effect, whether they are today on 5 March, or on 1 April next year after we have left. That is what the whole principle of retained law is, as I understand it—and I think that the noble and learned Lord knows that.

It is my concern in this amendment to make sure that, when the citizens of this country have current rights and protections, they should enjoy all those after Brexit. I thought that the Government were in favour of that principle. We heard earlier from another Minister, the noble Lord, Lord Duncan, that he believes that that is the case and favours that principle—and I think that that principle is enormously important.

Then there is the third issue, which I raised—and it is probably not the last time that I shall raise it in this House. The experience of Francovich is such that I believe that it should be carried forward into the whole corpus of law in this country, Scots law and English law. We continue to have these rights and these remedies. I believe their jurisprudence in this case to be a considerable advance of civilisation in the European Union over the last 25 years; there have been many such advances and, if we are going to carry forward the assets that we take over rather than throwing them away on Brexit, we should make sure that we carry forward this one. That is not a matter for this Bill; what is a matter for this Bill is the second point that I make, which is to make sure that in respect of retained law the rights that currently exist will be carried through and not abolished.

I hope that the Government will think about that between now and Report. I would certainly welcome the opportunity to discuss the matter with them before we decide how we can take this matter further. In the circumstances, I beg leave to withdraw the amendment.