British Telecommunications PLC, R (On the Application Of) v Treasury

An appeal by way of review is not a rehearing. Under the Civil Procedure Rules 1998, r 52.21, an appellate court should intervene in a finding of fact only where it was wrong. The formulations that no reasonable judge could have reached it, that it cannot reasonably be explained or justified, or that the evidence could not support it are materially equivalent. The court should ask whether the first-instance court had legitimate and proper grounds and should give weight to its assessment, even on written evidence. A decision may also rest on policy reasons independent of disputed questions of vires or protected property rights. An appellate court need not decide grounds unnecessary to the result, particularly where they have wider implications and an affected member is not a party.

BT sought judicial review of the Treasury’s decision, given effect by a direction under section 59A of the Social Security Pensions Act 1975, to extend full guaranteed minimum pension indexation for certain public service pensioners. Rule 10.2 of Section B of the BT Pension Scheme carried the indexation into the private scheme. BT argued that the Treasury should have used a stand-alone amendment to the Principal Civil Service Pension Scheme or other mechanisms and had misunderstood the legal and policy consequences.

The Divisional Court dismissed the claim: [2018] EWHC 3251 (Admin). Permission was granted on Grounds 1 and 1A. The appeal concerned whether BT had presented the PCSPS amendment route as a free-standing option and whether the Treasury had relied on policy reasons separate from its vires and property-rights concerns.

Appeal dismissed.

1. Appellate review. An appeal against factual findings under Civil Procedure Rules 1998, r 52.21, proceeds by way of review rather than rehearing. The different formulations in Henderson v Foxworth Investments Ltd [2014] UKSC 41, Volcafe Ltd v Cia Sud America de Vapores SA [2018] UKSC 61 and Smech Properties Ltd v Runnymede Borough Council [2016] EWCA Civ 42 expressed no difference of substance. The appropriate question was whether the Divisional Court had legitimate and proper grounds for its findings. Weight should be given to its assessment, even though the evidence was written.
2. Appeal Ground 1. The Divisional Court had legitimate and proper grounds for finding that BT’s consultation response presented a statutory override as a necessary element of its proposals, rather than presenting the PCSPS amendment route as a stand-alone option. The Treasury’s subsequent documents were reasonably understood in the same way. The evidence did not require a different conclusion, and the Divisional Court was correct to reject the ground.
3. Appeal Ground 2. Even if the first ground had succeeded, the appeal would have failed. The Treasury’s decision was supported by a distinct policy concern: crafting a solution for BT would deprive BTPS members of benefits they would otherwise receive and could appear to prefer BT’s private interests over those members. That policy concern was separate from, and additional to, concerns about vires and interference with property rights under A1P1.
4. Remaining grounds. Grounds 3, 4 and 5 did not arise once Grounds 1 and 2 failed. The Court declined to determine them because they raised wider issues of principle, could create uncertainty as precedent, and lacked the participation of a representative Section B scheme member. The refusal to address them was not an implicit approval or disapproval of the Divisional Court’s conclusions on those issues.

• Court of Appeal (Civil Division): In [2020] EWCA Civ 1, the appeal was dismissed.
• High Court, Administrative Court: The Divisional Court dismissed BT’s judicial review claim in [2018] EWHC 3251 (Admin).