Thomas, R (on the application of) v Ministry of Defence

For the purposes of an arguability challenge under European Community anti-discrimination law, a pension sharing order does not convert the former spouse’s deferred pension entitlement into pay. Pay under Article 141 of the EC Treaty concerns remuneration received directly or indirectly in respect of employment from the employer. A pension may be pay for the employee who earned it, but an amount transferred to a former spouse through ancillary relief proceedings does not thereby acquire that character for the former spouse. Where the proposed legal argument is not reasonably arguable, permission for judicial review and permission to appeal may be refused.

The claimant had obtained a pension sharing order following divorce. Her former husband’s pension payments continued, but domestic legislation delayed payment of her share until she reached the prescribed age. Following an earlier decision concerning a similar human-rights challenge, she sought permission to apply for judicial review on the new ground that the pension provisions were invalid under European Community anti-discrimination law. The central issue was whether her deferred pension entitlement constituted pay within Article 141(1) of the EC Treaty.

1. Permission refused. The proposed claim for judicial review was not reasonably arguable, and permission to appeal was also refused.
2. The court accepted that the claimant could argue that the domestic pension provisions were discriminatory under European Community law. The earlier decision in R (Susan Joan Smith) v Secretary of State for Defence [2004] EWHC 1797 (Admin) did not determine that separate issue or prevent the claimant from raising it.
3. Article 141(2) of the EC Treaty defines pay as ordinary basic or minimum wage or salary and other consideration received directly or indirectly, in respect of employment, from the employer. The pension received by the serving or former employee might fall within that concept.
4. A pension sharing order made in ancillary relief proceedings following divorce does not convert the amount awarded to the former spouse into pay for the purposes of Article 141. The order transfers part of the employee’s pension entitlement to the former spouse; it does not make the former spouse a recipient of remuneration from the employer.
5. Consequently, Article 13(5) of the EC Treaty and Council Directive 86/378 (EEC) did not assist the claimant. The court agreed with the reasoning that European Community law did not require a pensioner to be treated in the same way as the pensioner’s spouse, or vice versa.
6. The legal point was regarded as very likely to fail and close to completely unarguable. Permission to appeal to the Court of Appeal was refused, subject to the claimant’s right to apply directly to that court within 21 days.