Secretary of State for Work & Pensions v Lassal

On a reference for a preliminary ruling, the Court of Appeal expressed the view that Directive 2004/38/EC, article 16 permits a right of permanent residence to be acquired on the implementation date by reliance on an earlier five-year period of lawful continuous residence. The qualifying period need not end on or after implementation.

Article 16(4), which provides for loss after more than two consecutive years’ absence, should apply equally where the qualifying residence was completed before, on or after implementation. If lawful residence is assessed by reference to recital 17, the relevant conditions should include those in earlier Community instruments conferring residence rights on workers. As those questions were not acte clair, the court referred them to the Court of Justice and stayed the appeal.

The respondent, a French national, had worked or sought work in the United Kingdom from 1999 until February 2005. She then spent ten months in France before returning to the United Kingdom. In November 2006, while pregnant, she claimed income support. The claim was refused on the basis that she lacked a right to reside.

An Appeal Tribunal held that she had a permanent right of residence. A Social Security Commissioner upheld that conclusion, although he allowed the Secretary of State’s appeal on a factual-evidence issue that later ceased to be disputed. The Secretary of State appealed to the Court of Appeal, contending that article 16 of Directive 2004/38/EC could not be satisfied by a five-year residence period ending before 30 April 2006.

The central issue was whether earlier lawful residence as a worker could found a permanent right of residence under article 16(1).

1. Reference made; proceedings stayed. The Court of Appeal did not finally determine the Secretary of State’s appeal. It referred the stated question to the Court of Justice of the European Communities under article 234 of the EC Treaty, because the temporal scope of article 16 of Directive 2004/38/EC was not acte clair and required resolution before the appeal could be decided.

2. The court’s expressed view was that article 16 should be construed consistently with the Directive’s integration objective. A Union citizen should be able to acquire permanent residence on the implementation date by relying on a qualifying five-year period of continuous residence completed before that date. That construction was not impermissibly retrospective. Requiring the five years to be completed after implementation would postpone the benefit for workers with substantial earlier residence and would weaken, rather than strengthen, their residence rights.

3. Article 16(4) should apply consistently to all persons who qualify under article 16, irrespective of whether their five-year qualifying period was completed before, on or after implementation. Thus, a right acquired by reliance on earlier qualifying residence remains capable of being lost after an absence exceeding two consecutive years.

4. In light of McCarthy v SSHD [2008] EWCA Civ 641, the court treated the meaning of “legally” in article 16(1) as being subject to the pending Court of Justice questions. Its view was that, if recital 17 governed that expression, the conditions referred to should include conditions in earlier Community instruments that conferred residence rights on workers. On that view, the respondent’s earlier residence would qualify.

5. The proceedings were stayed pending the preliminary ruling or further order. Costs were reserved.

• Court of Appeal (Civil Division) — referred a question on article 16(1) of Directive 2004/38/EC to the Court of Justice of the European Communities and stayed the appeal.

• Social Security Commissioner — on 23 May 2008, upheld the conclusion that the respondent had a permanent right of residence, but allowed the Secretary of State’s appeal because some Appeal Tribunal findings lacked evidential support.

• Appeal Tribunal — on 3 September 2007, allowed the respondent’s appeal against the refusal of income support, holding that she had a permanent right of residence under regulation 15(1)(a) of the Immigration (European Economic Area) Regulations 2006.