On 27 February 2024, the Court of Appeal handed down judgment in the joined appeals of Dalston Projects and Others v Secretary of State for Transport and Eugene Shvidler v Secretary of State for Foreign, Commonwealth and Development Affairs[2024] EWCA Civ 172. Both cases arose from decisions taken under the Russia (Sanctions) (EU Exit) Regulations 2019. In the leading judgment, Singh LJ (with whom the Master of the Rolls and Whipple LJ agreed) summarised the approaches to proportionality challenges at first instance and in the appellate courts, before considering the respective grounds of appeal.
The Dalston Projects appeal concerned the first, and to date only, detention of a Russian-owned ship, using powers in the 2019 Regulations. In March 2022, the Secretary of State, the Rt Hon Grant Shapps MP, ordered the detention of a newly-completed superyacht, The Phi, which was moored at Canary Wharf when Russia launched its invasion of Ukraine. The Secretary of State relied on its ownership by “a person connected to Russia”. Mr Shapps arrived shortly after the police; he gave media interviews and filmed himself on TikTok, claiming that the yacht was owned by friends of President Putin. The Court of Appeal held that this “was not true” and “ought not to have been said and…certainly should not have been taken into account when exercising a discretionary power”.
The Appellants had challenged the detention on six principal grounds: Padfield improper purpose; irrelevant considerations; failure to state the grounds of detention; Tameside failure of enquiry; Article 1 Protocol 1 ECHR proportionality; and conversion. The Administrative Court (Sir Ross Cranston sitting as a High Court Judge) rejected each of these challenges in Dalston Projects and Others v Secretary of State for Transport [2023] EWHC 1885 (Admin).
In a detailed judgment, the Court of Appeal dismissed the appeal brought on corresponding grounds. Analysing ECHR proportionality, in light of the judgment of the Supreme Court in In re Abortion Services (Safe Access Zones) (Northern Ireland) Bill[2022] UKSC 32, Singh LJ held that in a first instance hearing, the court was required to consider proportionality for itself as a matter of substance and, even in cases engaging a margin of discretion, should not confine itself to examining the rationality of the decision-making. On appeal, said Singh LJ, cases would fall into one of three categories: (i) those cases in which an appeal lies on a point of law by way of case stated, where the appellate court cannot interfere with the assessment below except on Edwards v Bairstow [1956] AC 14 grounds (the lower court has misdirected itself in law or reached a conclusion that was not reasonably open to it on the evidence); (ii) those cases that concern the compatibility of a rule or policy with ECHR rights, where the appellate court will not accord any deference to the assessment of proportionality by the courts below but will carry out its own proportionality assessment; and (iii) those cases in which there has been an assessment of proportionality below on the facts of an individual case, where the appellate court would apply the approach described in In re B (A Child) (Care Proceedings: Threshold Criteria) [2013] UKSC 33 and consider whether the first instance court was “wrong”. Appeals in the third category would not mean rehearing the case as if it were a court of first instance and would ordinarily respect findings of facts made below, especially if there had been oral evidence; the appellate court should focus on the outcome of the assessment of proportionality but was not confined to asking whether there had been an error of law or an unreasonable conclusion.
John Bethell appeared for the Dalston Projects Appellants, instructed by Jaffa & Co.
In the Administrative Court, John was led by Nigel Giffin KC.
