R (Z) v Hackney LBC

The Court of Appeal held that the allocation arrangements of the Agudas Israel Housing Association (AIHA) and the nomination policy of the London Borough of Hackney lawfully amounted to direct discrimination on the ground of religion but were permitted under the Equality Act 2010. The court concluded that AIHA's arrangements were authorised by its charitable instrument and were permitted by section 193(1) and section 193(2)(b) of the Equality Act 2010 because the benefits were provided for the purpose of preventing or compensating for a disadvantage linked to the protected characteristic. The court also held, alternatively, that AIHA's arrangements were a proportionate means of meeting the needs or overcoming disadvantages of the Orthodox Jewish community within the meaning of section 158. The court rejected arguments that Convention rights (articles 8 and 9) were engaged in a way that required a different outcome, and held that Hackney could, in the circumstances, rely on section 158 when making nominations to AIHA properties. The court further rejected the claim under section 11 of the Children Act 2004, concluding Hackney’s arrangements did take into account children’s welfare and that specific urgent procedures (including direct offer mechanisms) were available and were used in the appellant’s case.

Background and parties

• The claimants challenged allocation arrangements by Agudas Israel Housing Association (AIHA), a charitable housing association which, in practice, allocates its properties to members of the Orthodox Jewish community, and the nomination practice of the London Borough of Hackney which nominates applicants to AIHA stock in accordance with AIHA's criteria.
• AIHA owns a small proportion of Hackney social housing (about 1%) and its stock is concentrated where the Orthodox Jewish (Haredi) community live. The claimants were non-members of that community and sought relief alleging unlawful discrimination in housing allocation.

Nature of the claim/application Not stated in the judgment.

Procedural history

• The Divisional Court (Lindblom LJ and Sir Kenneth Parker) upheld AIHA's arrangements ([2019] EWHC 139 (Admin), judgment 4 February 2019). The claimants appealed to the Court of Appeal which heard the appeal on 12 and 13 June 2019 and delivered judgment on 27 June 2019 ([2019] EWCA Civ 1099).

Issues framed by the court

• Whether AIHA's allocation practice, which operates as direct discrimination on the ground of religion, was lawful under the Equality Act 2010: specifically, the scope and application of section 158 (positive action to meet needs or overcome disadvantage) and section 193 (exceptions for charities), and whether section 193(2)(b) requires a proportionality assessment.
• Whether Convention rights (in particular articles 8 and 9) or EU law required a different construction of section 193.
• Whether Hackney's nomination practice was unlawful and whether Hackney breached its duties under section 11 of the Children Act 2004.

Reasoning and decision

• The court accepted that AIHA's arrangements amounted to direct discrimination on religious grounds but held that they were permitted. The court concluded that section 193(2)(b) does not itself require the separate, express proportionality balancing found in section 193(2)(a); section 193(2)(b) is an alternative statutory route which permits restricting benefits to a protected group where that restriction is for the purpose of preventing or compensating for a disadvantage linked to the protected characteristic. AIHA's arrangements were held to be enacted pursuant to its charitable instrument and to satisfy section 193(2)(b) on the facts.
• As an alternative basis, the court held that AIHA reasonably thought that members of the Orthodox Jewish community suffered disadvantages or had special needs connected to religion and that its allocation arrangements were a proportionate means of meeting those needs or overcoming those disadvantages within section 158.
• The court rejected submissions that the Human Rights Act 1998 or EU law required reading a proportionality requirement into section 193(2)(b) in these facts, and held that articles 8 and 9 of the Convention were not engaged (or, if engaged, the measures would be justifiable for the reasons given).
• Because AIHA's policy was lawful, Hackney's nomination practice was not unlawful; the court also rejected the argument that Hackney breached its section 11 duties, noting Hackney's recognition of acute need in the relevant community and the availability of direct-offer procedures which had been employed for the claimant.

Wider context noted by the court: the court recorded the acute imbalance between supply and demand for larger family accommodation in the Orthodox Jewish community, evidence of anti-Semitism affecting access to housing and the particular communal needs of the Haredi community. The court observed that its conclusion turned on the specific market conditions and the small size of AIHA’s portfolio, and might not be the same for a large provider.

Appeal dismissed. The Court of Appeal held that AIHA's allocation arrangements were lawful: they were authorised by its charitable instrument and fell within section 193(1) read with section 193(2)(b) of the Equality Act 2010 as provided for the purpose of preventing or compensating for a disadvantage linked to the protected characteristic; alternatively, the arrangements satisfied section 158 as a proportionate means of meeting needs or overcoming disadvantage. Because AIHA's arrangements were lawful Hackney’s nomination practice was also lawful and there was no breach of its section 11 duties in the circumstances. The court rejected arguments that section 193(2)(b) must be read to require a proportionality assessment and held Convention rights were not engaged so as to alter the outcome.

Divisional Court (Lindblom LJ and Sir Kenneth Parker) [2019] EWHC 139 (Admin) (judgment 4 February 2019) — appeal to the Court of Appeal ([2019] EWCA Civ 1099) which dismissed the appeal on 27 June 2019.