Youssef v Secretary of State for Foreign & Commonwealth Affairs

This is an appeal, with permission granted in part by Sir Richard Buxton and in part by McCombe LJ, against the decision of the Divisional Court (Toulson LJ as he then was and Silber J) of 23 July 2012 ([2012] EWHC Admin 2091) dismissing the appellant’s claim for judicial review of the Secretary of State’s decision in September 2005 to allow his name to be added to a list of persons subject to sanctions pursuant to United Nations Security Council Resolution 1617 of 2005. The decision had effect through the lifting or release of a “hold” earlier placed by the Secretary of State on the appellant’s designation for inclusion in the list. I will explain the process below. The effect of designation has been to prevent the appellant, who is a United Kingdom resident, from using, receiving or gaining access to any funds or other economic resources without the leave of the State. It is however to be noted that since 2009 the United Kingdom has sought, unsuccessfully, to have the appellant’s name taken off the list.

The appellant has permission to pursue his challenge in this court on three grounds. Ground 1 is that the correct standard of review of the decision is review on the merits, rather than the conventional rationality test (Wednesbury [1948] 1 KB 223); and had that standard been applied, the Secretary of State’s decision to lift the hold would have been exposed as irrational. Ground 2 is that the appellant’s designation had been proposed for reasons which rested on evidence obtained by torture in Egypt; and in those circumstances it was the Secretary of State’s duty to maintain the hold and so prevent the designation. Ground 3 is that the Secretary of State had supported the designation (by releasing the hold) because he determined that there were reasonable grounds to suspect that the appellant met the criteria for designation; but this was a legal error: to support the designation he must have been satisfied that the criteria were in fact met.

The United Nations Security Council Al-Qaida and Taliban Sanctions Committee was established in 1999 by United Nations Security Council Resolution 1267. I shall refer to it as the Sanctions Committee. It consists of all the Member States of the Security Council for the time being. It holds a list, known as the Consolidated List, of members of the Al-Qaida organisation and other individuals, groups, undertakings and entities associated with them. Resolution 1267, and later resolutions extending or revising the regime, impose on Member States a mandatory duty under Chapter VII of the UN Charter to freeze the assets of individuals and organisations whose names appear on the list; Article 25 of the UN Charter records the Member States’ agreement to “accept and carry out the decisions of the Security Council”. Paragraph 4(b) of Resolution 1267 required the Member States to

“freeze funds and other financial resources, including funds derived or generated from property owned or controlled directly or indirectly by the Taliban, or by any undertaking owned or controlled by the Taliban, as designated by the [Sanctions Committee], and ensure that neither they nor any other funds or financial resources so designated are made available, by their nationals or by any persons within their territory, to or for the benefit of the Taliban or any undertaking owned or controlled, directly or indirectly, by the Taliban, except as may be authorised by the Committee on a case-by-case basis on the grounds of humanitarian need.”

Resolution 1617 was adopted on 29 July 2005. It included these decisions:

“1… that all States shall take the measures as previously imposed by paragraph 4(b) of Resolution 1267 (1999) [and later resolutions] with respect to Al-Qaida, Usama bin Laden, and the Taliban and other individuals, groups, undertakings and entities associated with them, as referred to in [the Consolidated List]…

2… that acts or activities indicating that an individual, group, undertaking, or entity is ‘associated with’ Al Qaida, Usama bin Laden or the Taliban include:

- participating in the financing, planning, facilitating, preparing, or perpetrating of acts or activities by, in conjunction with, under the name of, on behalf of, or in support of;

- supplying, selling or transferring arms and related material to;

- recruiting for; or

- otherwise supporting the activities of;

Al-Qaida, Usama bin Laden or the Taliban, or any cell, affiliate, splinter group or derivative thereof.”

The expression “associated with”, appearing in the first sub-paragraphs of paragraphs 1 and 2 respectively of Resolution 1617, was first introduced into the scheme by Resolution 1333 adopted on 19 December 2000. The obligation imposed by paragraph 8(c) of 1333 opens with the words “to freeze without delay funds and other financial assets of Usama bin Laden and individuals and entities associated with him”.

A decision to place an individual’s name on the Consolidated List requires unanimity. When a listing request is made by a designating State, any member of the Sanctions Committee can ask for time to consider it. The request will then be placed on hold for a period of up to six months (or in exceptional circumstances for a further three months), after which the request will be treated as approved unless the member concerned has objected to the proposal. Decisions to de-list also require unanimity, except where a request to de-list is made by the designating State or States or where a recommendation to de-list has been made by the Ombudsperson (to whose role I will return below): see UN Security Council Resolution 1989 of 2011. In those circumstances unanimity is required to retain listing, subject to the possibility of referral to the Security Council itself.

Listing decisions of the Sanctions Committee were originally given effect in domestic law by the Al-Qaida and Taliban (United Nations Measures) Order 2002, purportedly made under the United Nations Act 1946. In Ahmed v HM Treasury [2010] UKSC 2, [2010] 2 AC 534 (to which the appellant was a party and of which I will give some account directly) the Supreme Court held that part of the 2006 Order which succeeded that of 2002 was ultra vires the Act. (I will refer to the Order, as did the Supreme Court, as the AQO.) However, the appellant’s listing was continued by force of EC Regulation 881/2002, adopted in order to give effect to sanctions imposed by the Security Council within the European Community. On 8 April 2010 the Al-Qaida and Taliban (Asset-Freezing) Regulations 2010 came into effect. They establish a domestic law regime for the enforcement of Regulation 881/2002, in light of the Supreme Court’s ruling in Ahmed.

Article 2.1 of EC 881/2002 provides:

“All funds and economic resources belonging to, owned, held, or controlled by a natural or legal person, entity, body or group listed in Annex I, shall be frozen.”

Article 2.3 provides:

“Annex I shall consist of natural and legal persons, entities, bodies and groups designated by the UN Security Council or by the Sanctions Committee as being associated with the Al-Qaida network.”

Article 7(c) (introduced in response to the decision of the European Court of Justice in Kadi v Commission, Cases C-402/05P and C-415/05P, 3 September 2008) makes provision for persons included in Annex I to present a request to the Commission for a statement of reasons. As soon as the Commission obtains a statement of reasons from the Sanctions Committee, it must communicate it to the person concerned, providing him with an opportunity to express his views. The Commission must then review the decision to include the person in Annex I and must forward those observations to the Sanctions Committee.

Security Council Resolution 1904 adopted in 2009 introduced into the UN sanctions regime the Office of the Ombudsperson. The resolution describes the Ombudsperson’s role as follows:

“20 [The Security Council] [d]ecides that, when considering delisting requests, the Committee shall be assisted by an Office of the Ombudsperson, to be established for an initial period of 18 months from the date of adoption of this resolution, and requests the Secretary-General, in close consultation with the Committee to appoint an eminent individual of high moral character, impartiality and integrity with high qualifications and experience in relevant fields, such as legal, human rights, counter-terrorism and sanctions, to be Ombudsperson, with the mandate outlined in annex II of this resolution, and further decides that the Ombudsperson shall perform these tasks in an independent and impartial manner and shall neither seek nor receive instructions from any government.”

The first Ombudsperson, Judge Kimberly Prost, is a senior jurist with wide-ranging experience in the fields of international counter-terrorism, human rights and sanctions regimes. She was appointed on 3 June 2010 and made her first report to the Security Council on 21 January 2011. In it she set out her approach to the standards to be applied when considering requests for de-listing. This is especially relevant to the third ground of challenge in this court. Judge Prost stated:

“In aid of coherent analysis and observations from the Ombudsperson, the information gathered and the reasoning applied to it must be assessed to a consistent standard. This standard must be one which is appropriate to the unique context of decisions by a committee acting under the express direction of the Security Council. It must take into account the purely international framework, where the benchmark used cannot be premised on the precepts of one particular legal system or tradition. It must instead focus on concepts generally accepted as fundamental across legal systems. In order to arrive at an appropriate standard for the Ombudsperson to apply, I have looked to national and regional law and jurisprudence, particularly in the context of asset freezing or other restrictions in counter terrorism regimes…

The standard must also reflect the express intent of the Security Council with regard to the purpose of the sanctions namely ‘that the measures… are preventative in nature and are not reliant upon criminal standards set out under national law’. At the same time, it must be a measure of adequate substance to sustain the serious restrictions imposed on individuals and entities through the application of the sanctions.

In this regard, it is evident that the standard applicable in criminal proceedings, nationally, regionally or internationally, is not appropriate for assessing the information and circumstances relating to a listing by the Committee. The sanctions are not intended to punish for criminal conduct. Rather, relevant Security Council resolutions demonstrate that the aim is twofold – to hamper access to resources in order to impede, impair, isolate and incapacitate the terrorist threat from Al-Qaida, Usama bin Laden and the Taliban, and to encourage a change of conduct on the part of those who are members of these groups or ‘associated with’ this individual or these groups. In these circumstances, the standards applicable to a determination of criminal guilt or innocence are obviously of a different nature and serve a distinct purpose from that of the sanctions.

At the same time, the sanctions flowing from inclusion on the Consolidated List are of a significant nature. When implemented on an international scale they have a direct and considerable impact on the rights and freedoms of individuals and entities. They are also of an indeterminate length, with no specified end date. Therefore, there must be some substance and reliability to the information upon which such sanctions are applied to these individuals and entities. Mere ‘suspicion’ or reliance upon statements without any consideration as to underlying information or some assessment of credibility is equally inapt in the context.

Finally, the standard must be informed by the wide variance of circumstances and types of information, relevant to these cases, particularly given the international nature of the listing process.

Taking into account the need to balance these factors, in my view, the standard for the Ombudsperson's analysis and observations should be whether there is sufficient information to provide a reasonable and credible basis for the listing.

‘Sufficiency’ provides the necessary flexibility in terms of assessing different types of information from distinct sources, quantitatively, qualitatively and in substance. The criteria of ‘reasonableness and credibility’ ensure that the combined circumstances provide a rational base for the listing, which is reliable enough to justify the imposition of the sanctions measures….In my opinion, it is a standard which recognises a lower threshold appropriate to preventative measures, but sets a sufficient level of protection for the rights of individuals and entities in this context.”

The latest Security Council resolution making provision for the Consolidated List, implemented since the proceedings before the Divisional Court, is 2083 of 2012. I will refer to other provisions touching the UN sanctions regime as necessary when I come to address the issues in the appeal.

It is convenient to introduce this authority at this stage. The case addressed the vires of the AQO and that of the Terrorism (United Nations Measures) Order 2006, also purportedly made under s.1 of the United Nations Act 1946. We are not concerned with the latter Order. As for the AQO, the court rejected a submission that that measure was unlawful because it interfered with rights protected by Articles 6 and 8 of the European Convention on Human Rights and Article 1 of Protocol 1. As Lord Hope (with whom Lord Walker and Lady Hale agreed) indicated (paragraph 71), it had been held by the House of Lords in R (Al-Jedda) v Secretary of State for Defence [2008] 1 AC 332 that the obligation under Article 25 of the UN Charter was, by virtue of Article 103, to prevail over any other international agreement, including the ECHR. But that did not conclude the position as a matter of domestic law. The majority held, as Lord Hope put it at paragraphs 81 and 82, that Article 3(1)(b) of the AQO was ultra vires s.1 of the 1946 Act because it denied to the designated individual an effective remedy by way of judicial review to challenge his listing: see also Lord Rodger at paragraph 182.

The judgments in Ahmed lay striking emphasis on the draconian nature of the Consolidated List regime, and the need in consequence for clear legal safeguards for those subjected to it. Lord Hope was at pains to underline the fact (paragraph 5) that the 1946 Act required no resolution in either House of Parliament for the making of an order under its powers. He stated (paragraph 6):

“The consequences of the Orders that were made in this case are so drastic and so oppressive that we must be just as alert [sc. as was Lord Atkin in Liversidge v Anderson] to see that the coercive action that the Treasury have taken really is within the powers that the 1946 Act has given them. Even in the face of the threat of international terrorism, the safety of the people is not the supreme law. We must be just as careful to guard against unrestrained encroachments on personal liberty.”

At paragraph 60 he said:

“It is no exaggeration to say, as Sedley LJ did in para. 125 [sc. in Ahmed in the Court of Appeal], that designated persons are effectively prisoners of the state. I repeat: their freedom of movement is severely restricted without access to funds or other economic resources, and the effect on both them and their families can be devastating.”

I should draw attention also to Lord Rodger’s observations at paragraphs 181 – 182, referred to by Toulson LJ at paragraph 50, to the effect that the Sanctions Committee is a political body and not a judicial body, and there is an obvious danger that States will use listing as a convenient means of crippling political opponents whose links with Al-Qaida may be tenuous at best. “[T]he harsh reality is that mistakes in designating will inevitably occur and, when they do, the individuals who are wrongly designated will find their funds and assets frozen and their lives disrupted, without their having any realistic prospect of putting matters right.”

All these considerations, it seems to me, inform the spirit of much of the argument advanced by Mr Otty QC on behalf of the appellant. He also relies on certain specific passages in the judgments in support of his argument on Ground 3 (standard of proof) to which I will come in due course.

The earlier background facts are set out in a judgment of Field J ([2004] EWHC QB 1884) delivered in an action brought by the appellant for damages for false imprisonment in the period 27 September 1998 to 9 July 1999, when he was detained under powers contained in the Immigration Act 1971. Field J described the history to 9 July 1999 (when as I shall show the appellant was released from detention) in very considerable detail. What follows is partly taken from his narrative, partly from the judgment of Toulson LJ in the Divisional Court, and partly from other materials before us.

The appellant is an Egyptian national. On 6 May 1994 he arrived in the UK and claimed asylum on the ground that he had been harassed and tortured by the Egyptian Security Forces. On 23 September 1998 he was detained under the Prevention of Terrorism (Temporary Provisions) Act 1989. He was released four days later but immediately re-arrested under powers contained in the Immigration Act 1971 upon a certificate issued on 26 September 1998 by the Secretary of State under s.3(2)(a) of the Special Immigration Appeals Act 1997, to the effect that his detention pending a decision on his asylum claim was necessary in the interests of national security. On 3 December 1998 he was refused bail.

On 23 December 1998 the appellant’s claim for refugee status was rejected. Although the Secretary of State acknowledged that the appellant’s case was one in which he might ordinarily have granted asylum, he declined to do so, having regard to Article 1F of the UN Convention relating to the Status of Refugees (which I need not cite) on the footing that the appellant had been involved in terrorist activity. He was assessed by the UK Security Services as a senior member of Egyptian Islamic Jihad (“EIJ”), an organisation which had mounted a number of high profile terrorist attacks in the foregoing twenty years. It was believed that his activities on behalf of the group were likely to have included support for the entry to the UK of EIJ activists and their travel overseas, including the movement of operational members. At paragraph 6 of his judgment (in a passage cited by Toulson LJ in the court below – paragraph 26) Field J said this:

“From the moment that Mr. Youssef was detained in September 1998 the Home Secretary was of the view that there was a strong case (in the absence of criminal proceedings) for removing him on national security grounds to Egypt or a third country. On 14 January 1999 a submission was put to the Home Secretary by his advisers that since there was no safe third country to which Mr. Youssef could be removed, the possibility of returning Mr. Youssef to Egypt should be explored. It was appreciated from the outset that given the evidence that detainees were routinely tortured by the Egyptian Security Service it would not be possible to remove Mr. Youssef to Egypt unless satisfactory assurances were obtained from the Egyptian Government that he would not be tortured or otherwise physically mistreated if he were sent back.”

There followed protracted negotiations between the Foreign Office and the Egyptian government relating to assurances. Then on 18 April 1999 it was announced in Cairo that the appellant had been sentenced by an Egyptian Military Court in absentia to life imprisonment with hard labour. The British Embassy was informed by the Egyptian authorities that the appellant had been identified as one of the leaders of a revolutionary organisation in confessions by other accused persons. However as Toulson LJ noted (paragraph 27) it was recognised in asylum proceedings here, brought by another of the Egyptian defendants, that there was good evidence that the proceedings of the military court were unfair, that the testimony before it was probably obtained by torture and that no credence should be given to the convictions in that trial: Al-Sirri v Home Office [2009] EWCA Civ 222.

The appellant launched proceedings for a writ of habeas corpus, but was at length released on 9 July 1999 after the Secretary of State had concluded (following communications within the British government at the highest level: the details are given by Field J) that there was no realistic prospect that sufficient or satisfactory assurances might be obtained, or therefore that the appellant might lawfully be removed to Egypt. On 29 November 1999 he was granted exceptional leave to enter the United Kingdom for one year. His leave was subsequently extended. In his judgment in the appellant’s claim for damages for false imprisonment, delivered on 30 July 2004, Field J held that he was unlawfully detained for 14 days, from 25 June 1999 to 9 July 1999. He considered (paragraph 80) “that the Home Secretary’s view that there remained after 25 June 1999 a real prospect of being able to remove Mr. Youseff in compliance with Article 3 ECHR was a view that was beyond the range of responses of a reasonable Secretary of State”.

On 29 March 2005 a State (the designating State: its identity has not been revealed to the appellant, at the insistence of the Sanctions Committee) issued a Note Verbale requesting that the Sanctions Committee should add twenty names, including that of the appellant, to the Consolidated List. The appellant was described as having been:

“convicted for membership of an illegal group which aims to obstruct the Constitution and use terrorism as a means of achieving its objectives by assassinating police officers and public figures, as well as committing the offences of murder and firearms procurement.”

However the Secretary of State placed a hold on the appellant’s designation so that the UK government might consider whether he met the criteria for designation. Following a submission of 12 September 2005 and an attachment from the Security Service, the Secretary of State on 14 September 2005 accepted that the appellant (and six of the other named individuals) fulfilled the criteria. The Security Service assessment stated:

“After arriving in the UK in 1994, Al-Sabai [sc. the appellant] was involved in the facilitation of false documentation for EIJ. Sabai was arrested in 1998 in connection with a planned bomb attack on the US Embassy in Tirana. He was held in custody while the Home Office tried to arrange deportation. The Egyptian government refused to give assurances about Sabai’s safety and he was released from custody in 1999 without charge.

Following his release the Security Service assesses that his views remain extreme.

Our assessment is that Sabai had strong historical links to EIJ during the mid and late 1990s. The potential remains for him to re-engage with EIJ.”

Accordingly the Secretary of State released the hold vis-a-vis the appellant, whose name was accordingly added to the Consolidated List on 29 September 2005. On 5 October 2005 his name was also added to Annex 1 of EC Regulation 881/2002.

On 13 May 2009 the Minister of State at the Foreign Office decided that the UK should seek the de-listing of the appellant. The Security Service had provided a further assessment, which included this:

“Update

Prior to his designation in 2005, Al-Sabai was detained in September 1998 in the UK for suspected involvement in the attempted attack on the US Embassy in Albania. Al-Sabai was detained until 1999 whilst the UK authority sought his removal. Because of safety on return issues and the failure to obtain the necessary assurances from the Egyptians he was released without charge in July 1999. In August 1999 Al-Sabai publicly left the EIJ and since then Al-Sabai has involved himself with developing his career as a journalist.

He posts his preachings onto his own personally run website, where he has also published extremist articles and professes himself to be an expert in Islamic Law. His ideas continue to be extreme.

Al-Sabai does not seem to involve himself in visibly directing or supporting extremists activities.

Potential for re-engagement

We assess that were Al-Sabai to be removed from the Consolidated List he would be unlikely to re-engage with EIJ. Although Al-Sabai continues to maintain his extremist views, he appears very reluctant to be directly involved in terrorist activities.

Recommendation

Although we stand by our 2005 assessments, on the basis of our current national security assessment against Al-Sabai we do not recommend that the FCO continues to support the inclusion of Al-Sabai on the Consolidated List because of a continuing association with Al-Qaida, the Taliban or Usama bin Laden…

Our consideration of the continued designation of Al-Sabai is based on an assessment of his continued associations pursuant to article 2 of UNSCR 1617 (2005). Ultimately, although our recommendation on the UN designation is a factor to be considered in your decision making process, we recognise that the final decision as to whether to seek or support the removal of Al-Sabai from the Consolidated List is a decision for the FCO.”

Successive attempts by the UK to obtain the agreement of the Sanctions Committee to de-list the appellant have been unsuccessful. On 18 March 2010 his solicitors wrote to the European Commission asking that his name be removed from Annex I to Regulation 881/2002. His solicitors also asked the Foreign Office to make representations to the Commission supporting his request to be taken off Annex I. The Foreign Office response has been that it is not willing to make an application to the Commission to that effect, but that the Commission is well aware of the government’s view that the appellant should no longer be on the Consolidated List (mirrored, as it is, by the EU regime). The response of the Commission to the appellant’s request has been that the Commission is in discussions with the Sanctions Committee.

Mr Swift QC for the Secretary of State was I think right to submit that the issue raised by Ground 3 (the right test: reasonable grounds to suspect or actual proof?) is logically prior to that raised by Ground 1 (the standard of review). It is necessary to see what was required of the Secretary of State, if he was to lift the hold, in order to ascertain the correct role of the court in a subsequent judicial review of his decision. If, as Mr Otty contends, he was required to find it proved on the balance of probability that the appellant was associated with the interests named in Resolution 1617, then there is more of an argument that the court must assess for itself the evidence which is offered as such proof. The argument is by no means conclusive: the court might find the evidence wanting, but nevertheless be satisfied that a reasonable Secretary of State could find it sufficient. But if the Secretary of State was only required to entertain reasonable suspicion of the appellant, the case for a merits review by the court is significantly weaker.

It is clear from paragraph 5 of the third witness statement of Mr Adrian Scott, Deputy Head of the Counter Terrorism Department at the Foreign Office, that the standard applied by the Secretary of State when he lifted the hold was indeed that of reasonable suspicion. Mr Scott also asserts that had the standard been that of the balance of probability (paragraphs 6 – 7) or reasonable grounds for belief (paragraph 8), the result would have been the same: the hold would still have been lifted. In summary his view is that the material from the Security Service furnishes proof to the civil standard. But I do not think it right to dispose of this part of the case on the footing that it would have made no difference whichever standard was applied by the Secretary of State. At least in a context like this Mr Scott’s affirmation cannot, with respect to him, suffice to show as much; and even if it might, we are in my view obliged to determine whether the Secretary of State’s approach to a matter with such onerous consequences was legally correct.

Was the application of a test of reasonable suspicion legally correct? The starting-point is to recognise that in lifting the hold the Secretary of State “[was] not exercising a power derived from an Act of Parliament. He [was] acting on behalf of the Government in its capacity as a member of an international body, the Security Council” (Toulson LJ, paragraph 53). In constitutional terms, the Secretary of State was acting by authority of the Royal Prerogative. It is, of course, now beyond contention that the exercise of Prerogative power is in principle subject to the judicial review jurisdiction. However it is important to be clear as to the juridical basis on which, in any given such case, the court may intervene. Judicial review of the use of statutory power in most cases turns on the actual or presumed intention of Parliament in passing the empowering legislation; but the Prerogative, by definition, involves no Act of Parliament. A judicial review of Prerogative power must found entirely on standards which are the product of the common law. Of these, reason and fairness are the cornerstones.

In this case the application of these standards requires in my judgment that the court be satisfied that the Secretary of State reached his decision conformably with the Consolidated List regime. His decision was as a participant in that regime. Reason and fairness – having effect, perhaps, as a species of legitimate expectation (but I do not mean to involve that expression’s panoply of conceptual footnotes) – surely demand that he should act according to the grain of the scheme and not across it. Mr Swift’s submission is that a test of reasonable suspicion is indeed conformable with the Consolidated List regime. Mr Otty submits the contrary. However there is a prior issue, for Mr Otty advanced an altogether more radical argument. He invoked the principle of legality “as an external prohibition on the misuse of public power” (supplementary skeleton 22 July 2013, paragraph 26, citing Fordham, Judicial Review Handbook, sixth edition, paragraph 35.1). He submitted (supplementary skeleton paragraph 26):

“In the present context the principle comes into play because [of] the automatic (and severe) effect of the United Kingdom’s decision to lift the hold on the Appellant’s listing on his ordinary common law rights dating back (at least) to Entick v Carrington (1765) St Tr 1029... In taking decisions which will have that effect, the Respondent cannot go further than the express wording of the Security Council resolution he is purporting to apply.”

Entick v Carrington made it plain (per Lord Camden CJ at 1066) that an individual’s right to peaceful enjoyment of his property could only be interfered with by clear legislative words; and this is a constitutional principle of the first importance. Now, I have said that Mr Otty’s reliance on Entick v Carrington raised a radical argument, but at first blush it seemed to amount to no more than a plea for a strict adherence to the text (or texts) of the Consolidated List regime: “the Respondent cannot go further than the express wording of the Security Council resolution”. At the hearing he submitted that the Prerogative power does not entitle the Secretary of State unilaterally to extend the breadth of the UN resolution. However as the argument developed Mr Otty was indeed inclined to take a more radical position (encouraged, perhaps, by interventions from myself), namely that in any event the Prerogative conferred no power on the Secretary of State to bar the appellant from access to funds or other economic resources, because it lacked the authority of legislation, certainly since the Supreme Court struck down the AQO.

I accept that if the Secretary of State’s release of the hold on the appellant’s designation rested solely on the Prerogative power, then it would appear to have been done without legal authority. But that is not the position. As a matter of domestic law the Secretary of State was obliged to apply the Consolidated List regime to its proper subjects by force of Articles 2.1, 2.3 and Annex I of EC 881/2002. There might be an argument upon the question whether the general words of the European Communities Act 1972, by virtue of which the Regulation has the force of law in the United Kingdom, are sufficient to authorise the EU legislature to empower or require the Secretary of State to deprive an individual of access to any economic resources (with or without proper proof of what was said against him); but no such argument has been run in this or any case, and it would plainly not be appropriate to canvass it now.

Given the legal base for the regime provided by EC 881/2002, Mr Otty’s appeal to “the principle of legality” provides, in my judgment, no added force to the appellant’s case. He submits that he is assisted by their Lordships’ decision in Ahmed. I have already referred to passages in the judgments in which the draconian nature of the Consolidated List regime is underlined. Mr Otty says that “[t]he fundamental conclusion reached by the Supreme Court in Ahmed was that the Executive had no power, without express parliamentary sanction, to interfere with the ordinary common law rights of the subject on the basis of a standard of proof of reasonable suspicion alone” (skeleton paragraph 31). He cites (supplementary skeleton paragraph 31) a large number of passages: paragraphs 57 – 61, 111 – 112, 129 – 144, 174, 193, 225. Certainly, there are points at which their Lordships expressed themselves in general terms. Thus “[t]here remains however the objection that the restrictions strike at the very heart of the individual’s basic right to live his own life as he chooses” (per Lord Hope at paragraph 60). “Under [the principle of legality] the court must, where possible, interpret a statute in such a way as to avoid encroachment on fundamental rights, sometimes described as constitutional rights” (per Lord Phillips at paragraph 111). But reading the whole case, the reach of the court’s concern was no wider than the question whether the reasonable suspicion test in the regulation was authorised by s.1 of the United Nations Act. And it is to be noted that at paragraph 58 Lord Hope said this:

“SCR 1373(2001) is not phrased in terms of reasonable suspicion. It refers instead to persons ‘who commit, or attempt to commit, terrorist acts’. The preamble refers to ‘acts of terrorism’. The standard of proof is not addressed. The question how persons falling within the ambit of the decision are to be identified is left to the member states.”

Compare paragraph 168 per Lord Rodger.

It is in my judgment clear that if the imposition of sanctions is in principle authorised by EC 881/2002, the general law does not impose a further requirement to the effect that the sanction may only bite if the material facts are proved on the balance of probability. By force of Articles 2.1, 2.3 and Annex I to 881/2002 the procedures of the material Security Council resolutions – the Consolidated List regime – are effectively incorporated into the EC Regulation. There is no doubt but that the imposition of sanctions is in principle authorised by EC 881/2002. The question then is whether the Secretary of State has lawfully deployed the Prerogative power to invoke that authority by lifting the hold on the appellant’s designation. That in turn depends on the correct resolution of the issue I stated earlier: did the Secretary of State reach his decision conformably with the Consolidated List regime?

I turn, then, to that question. The Divisional Court held (per Toulson LJ at paragraph 93):

“If the Foreign Secretary were deciding the question today, I would expect him to apply the standard set out by the Ombudsperson in her report to the Security Council (unless the Security Council were to determine that some other standard should apply). Her formula is that the test to be applied is ‘whether there is sufficient information to provide a reasonable and credible basis for the listing’, but one cannot do justice to that formula without reading her accompanying explanation of it. In a footnote she observed that ‘In the domestic designation of terrorist entities in a number of common law jurisdictions, a test of “reasonable grounds to believe or a basis/to believe/suspect/be satisfied of” involvement in or commission of terrorist acts or activities is used’. She also noted that the Commonwealth’s Model Legislative Provisions on Measures to Combat Terrorism recommended a test of ‘reasonable grounds to suspect or to believe’. I do not consider that it was unlawful for the Foreign Secretary to apply the test which he did at the relevant time.”

Mr Swift submits at paragraph 67 of his skeleton argument that there is “a very short answer” to this ground of appeal, to be found in paragraph 44 of Security Council Resolution 2083 of 2012, adopted after the ruling of the Divisional Court. Paragraph 44

“Strongly urges Member States... to apply an evidentiary standard of proof of ‘reasonable grounds’ or ‘reasonable basis’, as well as the ability to collect or solicit as much information as possible from all relevant sources”.

This argument shares with the reasoning of the Divisional Court a reliance on material coming into existence after the Secretary of State’s decision to lift the hold. I think with respect that there needs to be a closer focus on the UN documentation which was before him at the time.

It is a virtue of Mr Otty’s case that he starts with the text of Resolution 1617. He draws attention to the fact that paragraph 1 of 1617 requires “that all States shall take the measures as previously imposed by paragraph 4(b) of Resolution 1267 (1999) [sc. ‘freeze funds and other financial resources’] with respect to Al-Qaida, Usama bin Laden, and the Taliban and other individuals, groups, undertakings and entities associated with them”. He says that this imports a requirement that the Member State be satisfied that the target group or individual is in fact so associated; and that the adoption of a test of no more than reasonable suspicion “unilaterally expands” the scope of the resolution.

However the Consolidated List regime given by the Security Council resolutions has to be looked at as a whole. Thus the seventh recital to Resolution 1617 “[underscores] the importance of Member State designations pursuant to relevant resolutions and robust implementation of existing measures as a significant preventive measure in combating terrorist activity”. Though Mr Otty does not accept this, it seems to me that this reference (among others in the documents) to prevention casts light on the approach to be taken to proof of association with any of the relevant terrorist groups. The aim of the regime is to reduce the risk that succour will be given to the terrorists. The aim is clearly more effectively promoted by the adoption of a reasonable suspicion test for inclusion in the List.

I note also Article 7 of Resolution 1617, which urges the implementation of “the Financial Action Task Force’s (FATF) Forty Recommendations on Money Laundering and the FATF Nine Special Recommendations on Terrorist Financing”. The first requirement of Recommendation III of the October 2001 Special Recommendations on Terrorist Financing reads: “Each country should implement measures to freeze without delay funds or other assets of terrorists, those who finance terrorism and terrorist organisations in accordance with the United Nations resolutions relating to the prevention and suppression of the financing of terrorist acts”. Again, prevention is the theme. More concretely, the Interpretative Note to Recommendation III has this at paragraph 2: “The objective of the first requirement is to freeze terrorist-related funds or other assets based on reasonable grounds, or a reasonable basis, to suspect or believe that such funds or other assets could be used to finance terrorist activity... The intent to the first objective is preventative...” It is clear from paragraph 3 of the Note that Special Recommendation III is specifically linked to the provisions of Resolution 1267.

Later materials, including Resolution 2083 of 2012 referred to by Mr Swift and the Ombudsperson’s report referred to by the Divisional Court, are effectively all of a piece with this. It is plain in my judgment that in deploying the Prerogative power as he did the Secretary of State acted conformably with the Consolidated List regime.

If my Lords agree, that concludes Ground 3 in the Secretary of State’s favour. But there is a further point which I think should be noted. What would the position have been had the Secretary of State placed no hold on the appellant’s designation in the first place? The appellant’s name would then and there have been placed on the Consolidated List. I did not understand Mr Otty to submit in terms that the Secretary of State, by force of the principle of legality or Entick v Carrington, was obliged to impose and maintain a hold until and unless it was proved to his satisfaction that the appellant was associated with the named terrorist interests. But that is the logic of his position. In truth, in placing the hold on the appellant’s designation the Secretary of State acted in the interests of the appellant to see that there was a proper case for his inclusion in the List; and in releasing the hold after satisfying himself that there was, he did no more than allow the regime to run its course in accordance with its terms and pursuant to EC 881/2002.

As I have indicated, Mr Otty submits that the correct standard of review of the Secretary of State’s decision to release the hold is review on the merits, rather than the conventional rationality test (Wednesbury [1948] 1 KB 223). On this issue the Divisional Court, per Toulson LJ, concluded as follows:

“56.

I cannot see a proper basis in law for applying principles other than the usual public law principles in considering the legality of the Foreign Secretary’s decision. I recognise that the court could develop those principles by saying that in this case it should exercise its own judgment whether the claimant met the criteria for designation in September 2005, but I am not persuaded there is a sound basis for doing so, although I recognise the gravity of the consequences of the designation for the claimant.

57.

Deciding whether a person meets the criteria for designation is likely in many cases to involve an evaluation of intelligence material which in the nature of things the Foreign Secretary is likely to be in a better position to make than a judge. Even those judges of the Administrative Court who deal with a lot of cases involving sensitive security issues cannot hope to have the same level of knowledge or sensitivity to surrounding security issues as the Foreign Secretary or Home Secretary of the day.

58.

It is also a relevant factor, as Mr Swift properly reminded the court, that the courts customarily allow a wide measure of judgment to the Government in matters of security issues and foreign relations.”

Mr Otty submits however that authority favours his contention on Ground 1. He relies in particular on certain observations of this court in the Ahmed case (the Court of Appeal judgments are reported at [2010] 2 AC 534 before those of the Supreme Court). Sir Anthony Clarke MR as he then was said this:

“113.

The question is whether the court is powerless to achieve a solution whereby a person in the position of G can challenge the underlying basis of the case against him. The question is thus whether he can do so through judicial review. If he can do so under the TO, it would to my mind be very strange if he could not do so in the case of the AQO in a case where the evidence against him appears to be the same in both cases. If he cannot, I would be inclined to hold that the AQO was unlawful, by reason of the application of the principles briefly referred to in [43] to [45] above.

114.

The argument addressed to the judge by Mr Singh on behalf of G was that there must be implied into the AQO a right of access to the court by way of judicial review. That is not in dispute. It is the extent or content of the right that is in dispute. Mr Singh submitted to the judge that, since fundamental rights were affected, that review must include a means of challenging the factual basis upon which the Committee’s designation of him was made.

...

119.

I would accept the submission that the court has power to consider an application for judicial review by a person to whom the AQO applies as a result of designation by the Committee and, on such an application, to ask the court, so far as it can, to consider what the basis of the listing was. This will not be a challenge to the AQO itself but, if – to take the example of G – it were held that G should not have been listed, I see no reason why HMT (or the relevant Government body) should not, as the judge put it, be bound to support delisting. I feel sure that, if it were so held, HMT would wish to have G delisted and take appropriate steps to that end.”

Then Sedley LJ:

“147.

Unless an effective form of judicial review is available to challenge the nomination, this would in my view be a use of delegated powers to block access to the courts and accordingly a fatal flaw in the Order. But, although I am not sanguine about the viability of a merits review in the face of security-sensitive material, I do not dissent from the holding of the Master of the Rolls that such review is in principle available under the Al Qaida Order.”

Mr Otty also refers to Wilson LJ’s observations at paragraph 157, agreeing with the Master of the Rolls.

The context in which these observations were made is of the first importance. The possibility of a merits based review was in contemplation in Ahmed in this court only as a recourse by which, as it were, it might be proper to uphold the vires of the AQO. Since the Supreme Court later concluded that the AQO had to be quashed, the only basis for a merits based review in a case like the appellant’s fell away.

There were other authorities relied on by Mr Otty. They included this court’s decision in MB [2007] QB 415, the decision of the House of Lords in Rehman [2003] 1 AC 153, and that of SIAC in Zatuliveter (judgment 29 November 2011). But all of these involved the exercise of a statutory jurisdiction: not the supervisory jurisdiction of the common law. They do not supply clear authority for the standard of review in a case of this kind.

I should however say a little more about the case of MB, since the legislation with which it was concerned (s.3 of the Prevention of Terrorism Act 2005) provided by s.3(11) that in exercising its statutory supervisory function with regard to non-derogating control orders “the court must apply the principles applicable on an application for judicial review”. This court held (see paragraphs 48, 54 – 60 of the judgment of the court delivered by Lord Phillips CJ) that in relation to matters of past fact the court was required to make its own independent assessment. But it is important to note that this conclusion was founded on the applicability of Article 6 of the ECHR; and as I have already noted it was held by the House of Lords in R (Al-Jedda) v Secretary of State for Defence [2008] 1 AC 332 that the obligation upon Member States under Article 25 of the UN Charter was, by virtue of Article 103, to prevail over any other international agreement, including the ECHR.

It seems to me that this ground of appeal raises an issue touching the constitutional separation of powers. It is a commonplace that rights of appeal arise only under statute. Common law judicial review is not an appellate jurisdiction; its purpose is to confine the subordinate decision-maker within his proper legal limits, not to remake his decisions. It is therefore no coincidence that, generally, the judicial review court is not an arbiter of merits. It is so for good constitutional reasons. Absent a general right of appeal conferred by statute, a merits judgment by the court of a decision taken under statutory powers tends to usurp the decision-maker’s function as Parliament’s delegate. Likewise a merits judgment of a decision taken under the Prerogative tends to usurp the function of the executive, which is the sole arm of government to inherit the Prerogative power. Manifestly, the courts have no business to usurp the legislature or the executive. It follows that a merits judgment in a judicial review case will be the exception. It will arise only where that is required in order to test the legality of the decision under review. An instance is where the primary decision-maker’s jurisdiction to act depends upon proof of a precedent fact: in such a case, the judicial review court will ascertain whether the precedent fact is proved. Another instance, of considerable importance in today’s jurisprudence, is given by a shift in the boundary between fact and law. This is what has happened in cases where the law now requires a decision to be not only reasonable, but proportionate to a legitimate aim. This is of course a touchstone of review in many human rights cases. Where it arises, the judicial review court will test for proportionality; and to the extent (but only to the extent) that the exercise requires it, judge the merits.

But this is not such a case. If my Lords agree with my conclusion on Ground 3, there is no question of precedent fact. Nor is there any issue of proportionality: not only because we are outside the territory of the ECHR, but also because the Secretary of State was not required to exercise a discretionary judgment where there might have been alternative outcomes – fertile ground for a proportionality approach. Here, however, once satisfied that the appellant met the criteria for designation, the Secretary of State’s duty was to include him in the Consolidated List.

For these reasons this is not a case, in my judgment, in which a merits review is required in order to test the legality of the Secretary of State’s decision under challenge. I agree with the Divisional Court that Ground 1 fails.

It is convenient to refer at this stage to another potential issue, linked to Ground 1. On 9 July 2013, just over a fortnight before the hearing in this court, the appellant’s advisers wrote to the Secretary of State seeking his agreement that a “Closed Material Procedure” (CMP) pursuant to the Justice and Security Act 2013 would be appropriate in the event that this court concluded that a more penetrating review of the decision should be undertaken; and on 18 July an application was issued under s.6(1) of the Act for a declaration “that the proceedings are proceedings in which a closed material application may be made to the court”. Now, the 2013 Act had of course not been passed by the date of the Divisional Court proceedings, but a similar issue was canvassed in that court, some of the material before the Secretary of State at the time of his decision having been redacted. Toulson LJ described the appellant’s position in this way:

“63.

The claimant says that if he succeeds in his rationality challenge on the open material, the court should make the declaration which he seeks. If he fails on the open material, the court should then go into a closed session, in which it should examine the redacted material after disclosure to a special advocate appointed on the claimant's behalf. If on the full material the court decides that the rationality challenge is made out, it should so declare.”

Toulson LJ concluded:

“I do not consider that the two stage process advocated by the claimant would now be right as a matter of case management and, more fundamentally, as a matter of justice... Mr Otty advocates a ‘heads I win, tails you lose’ process, giving the claimant a double chance of winning – first without the PII material and secondly with it. I see no justice in that one sided approach.”

It seems implicit in this reasoning that the court considered that it would be open to it to conduct a CMP if it thought it right to do so. With respect it is not entirely clear why that view was taken in advance of the 2013 Act, given that in Al-Rawi [2012] 1 AC 531 the Supreme Court had held (in an action for damages) that a CMP could only be sanctioned by Parliament. However that may be, if the appellant were to urge a similar ‘heads I win, tails you lose’ approach in this court, now with the assistance of the 2013 Act, I should reject it essentially for the reasons given by Toulson LJ. In fact, as I understand it, Mr Otty takes a rather different position. As I have indicated, the premise of the letter of 9 July 2013 was that this court might conclude that a merits review should be undertaken; and for my part I have concluded that it should not. At paragraph 9(3) of his skeleton on this issue Mr Otty submits that “he should be, at least, entitled to address the Court on the potential impact of the [2013 Act] on the nature of the review of the Respondent’s decisions that is appropriate”. I disagree. For reasons I have given, a merits review is in principle inappropriate.

I should add that in my view the availability or otherwise of a CMP before the Divisional Court only touches Ground 1 as a possible additional argument in favour of the Secretary of State. A merits review would surely require this court to have access to the material before the Secretary of State; but if no CMP were available, that could not be done. However I have for my part rejected Ground 1 in any event.

The parties, in skeleton arguments submitted specifically to address the possibility of a CMP, have locked horns on procedural issues. In the circumstances I do not find it necessary to go into those.

The submission is that the appellant’s designation (or, before the hold was lifted, potential designation) was tainted because it rested on evidence obtained by torture. His case is summarised in this way in Mr Otty’s skeleton argument (paragraph 3):

“The appellant’s case is that the basis upon which the 1267 Committee was asked to designate him, and the Committee’s reasons for acceding to that request... lay in evidence obtained by torture in Egypt. He also presented evidence that the Secretary of State must have been aware of that fact when he supported the Appellant’s designation in 2005. Neither matter has ever been disputed by the Secretary of State.”

And at paragraph 26:

“The issue in the instant case is an important question of law: whether the Secretary of State, as a member of the 1267 Committee, could lawfully decide to support designation of an individual knowing that the evidence presented to the Committee, and so ultimately the Committee’s reasons for making the designation, involved the fruits of torture? The Appellant submits that the Secretary of State cannot lawfully do so.”

The Divisional Court rejected (paragraph 86) a rather different submission advanced by Mr Otty, namely that the “Secretary [of State] made his decision on the basis of the claimant’s conviction by the Egyptian military court in circumstances where [he] knew that his conviction was based on evidence obtained by torture”. They held, in effect, that the Secretary of State’s own reasons for accepting that the appellant was properly designated were not tainted by torture evidence. I did not understand Mr Otty to challenge this conclusion, which is in particular supported by the witness statement filed on 23 May 2011 by Mr Paul Morrison, a senior government official who was at the time in question on secondment to the Foreign and Commonwealth Office as Head of the Counter Terrorism Department. He said:

“31.

The decision by the Foreign Secretary that HMG should release its hold on [the appellant’s] designation was made taking into account the Ministerial submission dated 12 September 2005. That submission, when assessing whether [the appellant] met the criteria for designation, focused on information other than that provided to the 1267 Committee. Whilst I obviously cannot be certain that [the appellant’s] belief as to the circumstances in which the evidence to which he refers was obtained is unfounded, the FCO has no reason to believe that the information that the Foreign Secretary took into account when deciding to release the hold on [the appellant’s] designation was obtained by torture.”

The Divisional Court proceeded to address Mr Otty’s principal case – the case he advances in this court – as follows:

“90.

On the premise that the Foreign Secretary lawfully decided that the claimant met the criteria for designation, I do not see that it would be right for this court to hold that it was his legal duty to tell other member states that, while he agreed with the designation of the claimant, he objected to the reason put forward by others and would for that reason not consent to the designation. As I have already said, different states may have different reasons for concluding that a person met the criteria, which they may or may not be willing to share with one another. I do not believe that it would be right for the court to dictate to the Foreign Secretary that he must instruct other member states as to what might be a permissible basis for the designation, and must prevent a designation (for which in his view the criteria were satisfied) unless and until he was satisfied that they were all proceeding on a basis which he considered to be proper.”

Mr Otty takes issue with this reasoning. He submits that the Divisional Court mischaracterised his argument: “it was not a necessary part of the appellant’s case that such instruction be given. The only decision challenged was the Secretary of State’s decision to lift the hold on UN listing” (skeleton paragraph 25). But this is jesuitical. If the Secretary of State had maintained the hold on the ground that the designation’s proposal was based on torture evidence, the designation would not have taken effect, since as I have said a decision to place an individual’s name on the Consolidated List requires unanimity. In effect, the Secretary of State would have been telling the members of the Sanctions Committee that the designation was improper. The Divisional Court declined to require him to do so.

Mr Otty’s real case is that the Divisional Court was wrong to take that position. The Secretary of State was aware, as Mr Swift accepts, that evidence presented to the Committee in support of the listing included evidence that had been or may have been obtained by torture (although he was in no position to know what evidence other members of the Committee might have in mind in lending support to the listing). In those circumstances Mr Otty submits that the nature of the prohibition of torture by international law, being ius cogens erga omnes, required the Secretary of State to object to the listing. The Sanctions Committee as a “quasi-judicial” body was or should have been obliged to respect the international rule. He places some reliance on the fact that both the Ombudsperson and the United Nations Special Rapporteur (Mr Emmerson QC) have expressed the view that no reliance should be placed by the Sanctions Committee on evidence obtained by torture (letter from the Ombudsperson to the President of the Security Council, 31 January 2013, paragraphs 30 and 57).

In A (No 2) [2006] 2 AC 221 Lord Bingham referred at paragraph 33 to the definition of a peremptory norm of general international law in Article 53 of the Vienna Convention on the Law of Treaties as “a norm accepted and recognized by the international community of States as a whole as a norm from which no derogation is permitted and which can be modified only by a subsequent norm of general international law having the same character”. He proceeded to cite the judgment of the International Criminal Tribunal for the Former Yugoslavia in Prosecutor v Furundzija [1998] ICTY 3. Part of the passage cited is as follows:

“151.

Furthermore, the prohibition of torture imposes upon States obligations erga omnes, that is, obligations owed towards all the other members of the international community, each of which then has a correlative right. In addition, the violation of such an obligation simultaneously constitutes a breach of the correlative right of all members of the international community and gives rise to a claim for compliance accruing to each and every member, which then has the right to insist on fulfilment of the obligation or in any case to call for the breach to be discontinued.

153...   Because of the importance of the values it protects, this principle has evolved into a peremptory norm or jus cogens, that is, a norm that enjoys a higher rank in the international hierarchy than treaty law and even ‘ordinary’ customary rules. The most conspicuous consequence of this higher rank is that the principle at issue cannot be derogated from by States through international treaties or local or special customs or even general customary rules not endowed with the same normative force.”

In response Mr Swift makes much of the learning which shows that the courts will not interfere in the government’s conduct of foreign relations: see, most recently, Rahmatullah [2013] 1 AC 614 per Lord Kerr at paragraphs 65 and 66, citing earlier authority. That is clearly the general rule. But the court cannot ignore an established rule of international law, far less one which has the force of ius cogens erga omnes. In Trendtex Trading Corporation v Central Bank of Nigeria [1977] QB 529 this court held that the rules of international law form part of the law of England unless they are in conflict with an Act of Parliament. Lord Denning MR cited Lord Mansfield CJ in Triquet v Bath (1764) 3 Burr 1478. I would not base my decision on the proposition that the government’s conduct of foreign relations enjoys something close to an immunity from judicial review.

The true answer to Mr Otty’s argument on Ground 2 rests in my judgment on the facts of the case. In Al-Rawi [2008] QB 289 I said at paragraph 102:

“[T]he status of ius cogens erga omnes empowers but does not oblige a State to intervene with another sovereign to insist on respect for the prohibition of torture (paragraph 151 of Prosecutor v Furundzija)...”

But Mr Otty’s submission entails an obligation upon the Secretary of State so to intervene. Given that the Secretary of State’s own reasons for lifting the hold were not tainted by torture evidence, there is nothing in Mr Otty’s case save an insistence that the United Kingdom should, in effect, have stymied the designation because other States were not so pure. The law did not require him to do so.

I would dismiss the appeal.

I agree.

I also agree.