Opening the floodgates on moving away from EU law?

The UK Government has decided that more UK courts should be able to depart from decisions of the European Court of Justice when the transition period ends.

The EU (Withdrawal) Act 2018 (the ‘2018 Act’) enabled the UK Supreme Court to depart from retained EU case law. (Retained EU case law in this context refers to principles and decisions laid down by the Court of Justice of the European Union on EU law retained under the 2018 Act, as modified in UK law.) When departing from retained EU law, the court is to apply the same test as it would, to depart from its own case law, that is ‘when it appears right to do so.’ The test initially appeared in a 1966 Practice Direction and has evolved in subsequent case law. The Practice Direction was clear that too rigid reliance on precedent ‘may lead to injustice in a particular case and also unduly restrict the proper development of the law.’ But it also recognised that precedent provides a ‘…degree of certainty’ and ‘a basis for orderly development of legal rules.’

Following the election last year, the Government amended the 2018 Act opening up the way for other courts also being able to depart from EU case law. But, there first had to be a consultation. Despite that safeguard, the provision generated much debate at the time. That consultation took place this summer when the Government sought views on whether that power should be extended:

(i) only to various Courts of Appeal in the UK (Courts of Appeal) (Option 1); or

(ii) in addition to the Courts of Appeal, to High Courts in the UK (Option 2).

There were 75 responses (40% from the legal services sector including ourselves). The Government, having considered the responses, has decided:

(i) to proceed with Option 1 and extend the power to depart from retained EU case law to the Courts of Appeal; and

(ii) for those courts to apply the Supreme Court’s test.

The Government decision is interesting as 73% of the responses were either that there should not be an extension, or there was no comment on extension, or the response was unclear. However, when combining those who thought that there could be an extension (27%) (including us) with those who initially replied ‘no’ but said that if the Government were to make regulations in any event, they would prefer Option 1, that rose to 56%.

The responses from the statutory judicial consultees (the most senior judicial position holders in the UK), other judicial respondents and the devolved administrations seem, understandably, to have carried much weight in the decision-making process. The Supreme Court may, as we noted in our response, find it helpful to have decisions from the Court of Appeal to inform its approach in respect of when, and how, to depart from retained EU case law.

So, not the floodgates that many were fearing. By limiting the extension to the Courts of Appeal, the decision avoids concerns, such as ours, of the risk of conflicting decisions at High Court level and a lack of broader clarity about the interaction between EU and UK case law. Not all first instance judgments are reported and/or issued electronically, which makes it yet more difficult to ensure that a consistent approach is being taken to a departure from retained EU case law across courts at this level.

As to the test to be applied, although we thought that a different test should be applied as the Supreme Court test gave lower court judges overly wide discretion, the majority of the responses was that it should be the same.

The Government has laid before Parliament a statutory instrument which seeks to give effect to this decision. If approved by both Houses of Parliament, it will come into effect at 11pm on 31 December 2020. Parties will be able to test the law at a level they may not have previously thought possible. What impact will this have on the legal infrastructure? We shall have to wait and see.