Following pressure from the in-coming Blair government, in the late 1990s the three Crown Dependencies enacted legislation modelled closely on the UK Human Rights Act 1998 – in Jersey, the Human Rights (Jersey) Law 2000. The States Assembly passed the 2000 Law with little controversy, 49 States members voting pour and only one contre. It took six years to bring into force, while the island’s statute book was amended to remove acknowledged ECHR incompatibilities in areas including the status of illegitimate children, police powers, compulsory purchase, and mental health. The need to equalise the age of consent for gay teenagers ended any lingering motherhood-and-apple pie sentiment around incorporation of ECHR rights, bringing home to some States members the reality that their policy choices were constrained; the delay led to a Strasbourg friendly settlement for a 16-year-old Jersey schoolboy.

In the Jersey courts, an anticipated surge of litigation against public authorities on Convention grounds turned out to be a trickle. Across 2007-2023, there were just 27 challenge cases, where a person launched legal proceedings against a public body. Only seven of these resulted in success for the individuals on Convention rights: two foreign nationals serving prison sentences for child sex offences were saved from deportation thanks to the Royal Court’s Article 8 ECHR balancing exercise; a prisoner serving a sentence for money laundering who was required to be handcuffed at his father’s funeral won in the Jersey Court of Appeal under Article 8; in separate cases, two asylum seekers relying on Article 3 had procedural victories insofar as the Royal Court held that the quality of reasons given by the Minister were insufficient; and four children removed by social workers and police from their family home, and their parents, won in a damages claim for breach of Article 8. None of these related to high-profile government policy or recently-enacted legislation. In 2024, however, two constitutionally significant cases are playing out.

The Imperium litigation

In January the Jersey Court of Appeal in Imperium Trustees (Jersey) Ltd v Jersey Competent Authority [2024] JCA 014 provided the island with its first declaration of incompatibility, finding that the International Co-operation (Protection from Liability) (Jersey) Law 2018 breached Article 6 rights of access to a court and equality of arms.

Jersey’s status as a highly regulated offshore finance centre had led to duties under numerous international agreements being placed on Revenue Jersey, the States of Jersey Police, the Law Officers’ Department, and other public bodies to assist other jurisdictions collect evidence in relation to non-payment of tax, take measures to counter financing of terrorism, and recover the proceeds of crime. The 2018 Law enacted a policy that Jersey public authorities would not be liable in damages, for consequential loss, or costs in legal proceedings ‘in respect of any act done in the discharge or purported discharge of the public authority’s functions under any enactment specified in Schedule 1 [nine Laws are listed] or Regulations or an Order made under such enactment which entitles the public authority to give assistance to a relevant authority of any country or territory outside Jersey unless it is shown that the act was done in bad faith’. In July 2018, the draft Law was nodded through the States Assembly in a few minutes with no substantial debate. Even by Jersey’s extremely light touch legislative scrutiny process, this was a rapid enactment. As normal, the Law as adopted by the Assembly was vetted by lawyers in the UK Ministry of Justice before being presented for Royal Assent to the Privy Council. The fact that this was granted relatively swiftly in October 2018 suggests the UK government (responsible in Strasbourg for the island’s compliance with the ECHR) had no concerns about the 2018 Law’s compatibility with Convention rights. The Jersey Court of Appeal held otherwise.

The challenge came not from a human being but a trust corporation. On its website, Imperium describes itself as ‘An independent, privately owned private client and fund services Group based in Guernsey, Jersey and London’, noting that ‘There are a number of reasons clients seek to include offshore entities as part of their financial structuring, ranging from estate planning, wealth protection, to tax planning and confidentiality’. The confidentiality of Imperium’s business was tested when, at the behest of the Belgium tax authorities, Jersey’s Comptroller of Revenue issued a notice under Jersey’s tax exchange of information legislation requiring disclosure of information about dividends paid by a company to a trust administered by Imperium. In the middle of what is turning out to be protracted litigation on the lawfulness of the notice, Imperium sought an order that its costs at various substantive and interlocutory hearings should be costs in the cause. The Attorney General resisted this, pointing to the 2018 Law.

In a 255-paragraph judgment, the Jersey Court of Appeal held that the litigation was about ‘civil rights and obligations’ rather than tax, so Imperium’s situation fell within the protective ambit of Article 6. The majority (Matthews JA and Sir William Bailhache P) found that the 2018 Law’s policy goal was simply to protect the budgets of public authorities, which was not a legitimate aim for ECHR purposes. Wolffe JA could see an additional and acceptable aim: dispelling any chilling effect that the risk of damages awards or costs orders might have on Jersey’s public authorities. All three Justices, however, agreed that the 2018 Law lacked proportionality. On 11 April, the Jersey Court of Appeal refused leave to appeal to the Judicial Committee of the Privy Council: though accepting that there was one point of law of public importance (Matthews JA and Bailhache P) or three arguable points of law (Wolffe JA), the question of whether to consider them on appeal should be decided in London by the Judicial Committee.

The Buckley litigation

In a second piece of on-going litigation, in the latest (February 2024) judgment Buckley v Minister for Treasury and Resources [2024] JCA 085, the Jersey Court of Appeal (Sir William Bailhache JA this time sitting as a single judge) has opened the door for another declaration of incompatibility and for even more profound constitutional questions to be pursued.

The Finance (Budget 2023) (Jersey) Law 2023 increased land transaction tax (LTT) on homes that will not be the purchaser’s main residence (buy-to-lets, second homes, holiday homes) from a range of 0.5% – 10.5% to 3.5% – 13.5%, depending on the value of the property. The policy originated in backbench pressure dating back to 2021, in response to concern that buy-to-let sales by investors were adversely affecting the availability of homes for islanders and property prices. Introducing the draft Budget Law, the Minister’s proposition stated briefly in relation to LTT increases that ‘Economic analysis has assessed the potential impacts on revenue and owner occupation. It is suggested that the measure could modestly increase revenue and stimulate additional purchases by owner-occupiers’. The Budget Law was passed by the Assembly 46 pour and no member voting contre. This and other recent government interventions in the housing market have become a political hot potato.

Mr Buckley had agreed to buy two flats in a new waterfront development ‘off plan’ from the Jersey Development Company, which describes itself as the Government of Jersey’s ‘regeneration arm’, long before the LTT policy was given legal effect but there were delays (not his fault) in completing the transactions. He was caught by the new policy, and its rapid introduction with no transitional measures meant that rather than the expected £4,200 in LTT he would have to pay £13,500. Buckley launched an application for judicial review on several grounds. Leave was granted on some by the Royal Court; in this latest judgment, the Jersey Court of Appeal ruled that the challenge could proceed to a full hearing on others.

In a bold contention, Buckley argues that Laws passed by the States Assembly are justiciable. Orthodox constitutional thinking has been that the validity of Jersey primary legislation cannot be challenged in the Jersey courts because the States Assembly has ‘parliamentary sovereignty’. The reasoning, no doubt to be developed in the forthcoming substantive hearing, was summarised by Bailhache JA as follows: ‘His Majesty in Council is supreme within the Jersey constitution and his decisions (to give or withhold Royal assent) cannot be judicially reviewed; and it follows that the States Assembly cannot be supreme since there is a higher and supreme body to which the States are subordinate. Accordingly, the argument was made that until such time as His Majesty in Council gave assent to the legislation, it remained open to judicial review. Furthermore, it was, for similar reasons of lack of supremacy, open to the Court to review the States Assembly acting in its legislative capacity’ (para 14). The argument seems to draw on R (Barclay) v Lord Chancellor and Secretary of State for Justice [2009] UKSC 9 (‘Barclay (No.1)’), in which the UK Supreme Court held that an Order in Council granting Royal Assent to Sark legislation was amenable to judicial review in the courts of England and Wales. In the Jersey courts, Buckley’s challenge is not to the grant of Royal Assent to the Budget Law but to the validity of the Budget Law itself.

Bailhache JA also gave leave for Buckley to pursue a ground of challenge to the rise in LTT based on Protocol 1, Article 1 of the ECHR (protection of property), presumably in conjunction with Article 14 (prohibition on discrimination), raising the prospect of a declaration of incompatibility under the Human Rights (Jersey) Law 2000 – though that would not affect the validity of the Budget Law. There seem to be two prongs to this (see para 54 of an earlier judgment): first, ‘the increased rate of tax amounted to discrimination between those owning property and those who did not because there was no justification for imposing different rates of tax on those acquiring a property for use as a main residence and on those who were using it for some other purpose’ and second there was indirect discrimination ‘because the tax was likely to apply disproportionately to non-Jersey nationals because it applies to those not living in the property and therefore was more likely to apply to those from outside the island’.

Responding to constitutional challenge

So, both the Imperium and Buckley litigation are playing out. In Imperium, we don’t yet know if the Judicial Committee of the Privy Council will grant leave to the Jersey authorities to appeal the Article 6 points on costs – and the substantive challenge to the notice issued at the request of the Belgium tax authorities, including questions under Articles 6 and 8 ECHR, is still to be decided in St Helier. Spurred on by Buckley, in February Imperium sought and was granted leave by the Royal Court to amend its substantive judicial review to challenge the whole legislative scheme for tax information exchange notices as incompatible with Convention rights. The Jersey Royal Court has yet to hear the substantive judicial review in Buckley. Much is therefore still up in the air.

What seems clear, however, is the Jersey courts’ increasing confidence and willingness to ask searching questions about the rationales for major policy decisions taken by the Government of Jersey, hear novel legal submissions, and be critical of how the States Assembly scrutinises draft legislation.

In Imperium, Matthews JA’s step-by-step dissection of the parliamentary travaux préparatoires for the 2018 Law highlights the inadequacy of the Assembly’s general approach to legislative scrutiny.  For Jersey policymakers and law drafters, the unfolding litigation points to the advisability of spelling out on the face of legislation the purposes sought to be achieved in policy areas prone to ECHR challenge. This has been done in the past: the Control of Housing and Work (Jersey) Law 2012, regulating who may occupy what homes and take which jobs, contains a pre-amble recognising “provision is needed for controlling (a) the overall population density of Jersey; and (b) the availability of work and housing in Jersey for people with strong connections or associations with Jersey and, more generally, in such a way that is in the best interests of the community in Jersey”. For the States Assembly, the litigation (whatever its final outcome) should act as a spur to improving the quality of scrutiny. In 2013, the Jersey Electoral Commission found that “most primary legislation is enacted by the States [Assembly] with minimal parliamentary scrutiny” and that this constituted a “serious democratic deficit”. This is now being noticed in the courts.

What the island must, at all costs, avoid in the emerging era of constitutional litigation is descent into intemperate and often badly misinformed ministerial criticism of judgments and judges of the kind that has blemished UK public life, under Labour as well as Conservative governments, since the 1990s. The Government of Jersey and States Assembly should (and I believe will) respond the judgments in a spirit of respect for the respective legitimate roles of the executive, legislature, and judiciary.

Andrew Le Sueur is Professor of Constitutional Justice at Essex Law School, University of Essex

(Suggested citation: A. Le Sueur, ‘Human Rights Litigation in Jersey: A Constitutional Turn?’, U.K. Const. L. Blog (23rd April 2024) (available at https://ukconstitutionallaw.org/)