Introduction

The landmark case of Dalston Projects Ltd & Ors v Secretary of State for Transport ([2024] EWCA Civ 172) addresses pivotal issues surrounding the judicial review of executive sanctions under the Sanctions and Anti-Money Laundering Act 2018 ("SAMLA") and the Russia (Sanctions) (EU Exit) Regulations 2019. The appeals pertain to the detention of a luxury yacht and the designation of an individual under sanctions regimes targeting Russian interests amid geopolitical tensions related to Ukraine.

The Court of Appeal's decision provides comprehensive guidance on the principle of proportionality under the Human Rights Act 1998 ("HRA"), delineating the role of both first-instance and appellate courts in scrutinizing executive actions that interfere with protected rights. This commentary delves into the case's background, the Court's findings, and its broader implications for administrative law and human rights jurisprudence.

Summary of the Judgment

The Court of Appeal dismissed both appeals raised by Dalston Projects and Eugene Shvidler. The core issues revolved around the proportionality of the executive's decisions to detain a yacht and designate an individual under the 2019 Regulations, specifically examining their compatibility with Articles 1 of the First Protocol and Article 8 of the ECHR.

The judgment meticulously reiterated the four-limb test for proportionality as established in Bank Mellat v HM Treasury (No 2) [2013] UKSC 39, emphasizing:

• The legitimacy of the measure's objective.
• The rational connection between the measure and its objective.
• The availability of less intrusive means.
• The fair balance between the measure's benefits and its impact on individual rights.

Both appeals concluded that the executive's actions were proportionate, maintaining a balanced approach between public interest and individual rights, and adhering to the established legal frameworks.

Analysis

Precedents Cited

The judgment extensively references seminal cases that have shaped the application of proportionality and judicial review in the UK:

• Bank Mellat v HM Treasury (No 2) [2013] UKSC 39: Established the four-limb test for proportionality.
• R v Oakes [1986] 1 SCR 103: Originated the four-limb proportionality test in Canadian jurisprudence.
• Huang v Secretary of State for the Home Department [2007] UKHL 11: Reinforced the importance of the fourth limb of the proportionality test.
• In re Abortion Services (Safe Access Zones) (Northern Ireland) Bill [2022] UKSC 32: Clarified appellate courts' roles in overarching proportionality assessments.
• In re B (A Child) (Care Proceedings: Threshold Criteria) [2013] UKSC 33: Provided guidance on appellate review of proportionality determinations in care cases.

These precedents underpin the Court's framework for assessing the legality and fairness of executive sanctions.

Legal Reasoning

The Court of Appeal underscored that proportionality assessments are fundamental in cases where executive actions infringe upon Convention rights. The legal reasoning followed these steps:

1. Legitimate Aim: Affirmed that the executive measures aimed to respond to Russia's actions in Ukraine, aligning with legitimate state interests.
2. Rational Connection: Determined that detaining the yacht and designating the individual were logically connected to the intended impact on Russian economic capacities.
3. Less Intrusive Means: Concluded that no less restrictive alternatives were available to achieve the same objectives without impinging on individual rights.
4. Fair Balance: Found that the public interest served by the measures outweighed the interference with the appellants' rights.

The Court emphasized that while the judiciary reviews proportionality, it affords deference to the executive's expertise, especially in matters of foreign policy and national security.

Impact

This judgment reinforces the judiciary's role in upholding human rights while respecting executive discretion. It:

• Affirms the applicability of the four-limb proportionality test in sanctions cases.
• Clarifies the boundaries of appellate review, distinguishing between factual assessments and overarching proportionality judgments.
• Strengthens the legal framework governing sanctions, ensuring they are applied judiciously and proportionately.
• Potentially influences future cases involving executive powers, especially where human rights are at stake.

Complex Concepts Simplified

Proportionality Test

The proportionality test is a legal principle used to determine whether the interference with individual rights is justified by the public interest it serves. It comprises four components:

• Legitimate Aim: The measure must aim to achieve a lawful objective.
• Rational Connection: There must be a logical link between the measure and its intended goal.
• Less Intrusive Means: The measure should be the least restrictive option available.
• Fair Balance: The benefits of the measure should outweigh the harm caused to individual rights.

In this case, the court applied this test to assess the legal validity of detaining the yacht and designating Mr. Shvidler under sanctions.

Judicial Review

Judicial review is a process by which courts evaluate the legality of decisions or actions taken by public bodies. It ensures that executive authorities act within their powers and adhere to principles of fairness, reasonableness, and proportionality.

In the Dalston Projects case, the appellants sought judicial review of the sanctions imposed, claiming they were disproportionate and violated human rights.

Conclusion

The Court of Appeal's decision in Dalston Projects Ltd & Ors v Secretary of State for Transport serves as a critical reference point for the intersection of human rights and executive sanctions. By meticulously applying the proportionality test and delineating the roles of appellate and first-instance courts, the judgment upholds the balance between safeguarding public interests and protecting individual rights. It reaffirms that while the judiciary has a pivotal role in scrutinizing executive actions, it must also respect the expertise and discretion vested in the executive, especially in complex areas like international sanctions and national security.

Legal practitioners, policymakers, and scholars will find this case instrumental in understanding the evolving landscape of administrative law and the continued emphasis on proportionality in judicial reviews.