Her Majesty’s Treasury v Mohammed Jabar Ahmed and others

A court may suspend the operation of an order which it makes. That power does not, however, permit an unlawful legislative measure to acquire temporary validity.

Where subordinate legislation was ultra vires from the moment it was made, a later declaration and quashing order state the existing legal position. Suspending those remedies is inappropriate where its intended practical effect is to induce third parties to behave as though the unlawful measure remains effective. A court should not use suspension to obscure the legal consequences of its judgment.

The appeals concerned asset-freezing restrictions imposed under the Terrorism (United Nations Measures) Order 2006 and article 3(1)(b) of the Al-Qaida and Taliban (United Nations Measures) Order 2006. The court had held that those measures were ultra vires. It then had to settle the orders giving effect to its judgment.

The Treasury asked the court to postpone the quashing orders for six or eight weeks. It wished to preserve the practical operation of the restrictions while lawful replacement measures were introduced. The central issue was whether the court should exercise its accepted power to suspend its orders when suspension could not confer legal validity on the impugned measures.

1. By a majority of six to one, the court refused to suspend any part of its order. Lord Phillips delivered the majority judgment, with which Lord Rodger, Lord Walker, Lady Hale, Lord Brown and Lord Mance agreed. Lord Hope dissented on suspension.

2. The court possessed power to suspend the effect of an order which it made. The parties accepted that proposition, and the court agreed. The difficulty concerned the proper exercise of that power, not its existence.

3. The impugned provisions were ultra vires and had no effect in law. The court’s order did not change that legal position but declared it. Quashing the provisions made their invalidity unmistakable. Suspending the quashing orders could misleadingly suggest that the provisions remained in force during the suspension period.

4. The Treasury sought suspension principally because banks and other third parties would probably continue to observe the asset freezes until the formal orders took effect. Any such conduct would depend upon the mistaken belief that suspension affected legal rights and obligations. The court would not employ a procedure intended to obscure the effect of its judgment, even though the practical and national-security objectives were understandable.

5. Lord Hope would have suspended the orders. He considered that a short suspension would not validate the provisions or affect remedies retrospectively. In his view, the likely conduct of financial institutions, the national interest and the risk of serious and irreversible harm justified postponement while Parliament and the executive enacted replacement measures.

6. The individual appellants’ appeals concerning the Terrorism (United Nations Measures) Order 2006 were allowed. That Order was declared ultra vires and quashed. The appeal concerning the Al-Qaida and Taliban (United Nations Measures) Order 2006 was allowed to the extent that article 3(1)(b) was declared ultra vires and quashed. The Treasury’s appeal in Youssef was allowed only to set aside Owen J’s declaration.

1. United Kingdom Supreme Court: The individual appellants’ appeals were allowed. The relevant Order and provision were declared ultra vires and quashed without suspension. The Treasury’s appeal in Youssef was allowed only to the extent of setting aside Owen J’s declaration.
2. Court of Appeal: The appeals came from the decision reported as [2008] EWCA Civ 1187. The courts below had suspended the effects of their orders while further appeals were pursued.
3. Administrative Court: The proceedings included challenges to the asset-freezing measures. The Supreme Court set aside the declaration made by Owen J on 10 July 2009 in Youssef’s case.