England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
SOCIAL SECURITY COMMISSIONER JACOBS

		Royal Courts of Justice Strand, London, WC2A 2LL
		10/03/2009

SCHEDULE

ORDER

Lady Justice Arden:

1. This is the judgment of the Court setting out in summary our reasons for deciding to refer questions to the Court of Justice for the European Communities (the Court of Justice) on the interpretation of Directive 2004/38/EC ("the Citizenship Directive"), and our views on the questions so referred.
2. Miss Lassal, a French national, made a claim on 20 November 2006 for income support. She had resided in the United Kingdom as a worker since September 1999, save for ten months commencing February 2005 when she returned to France for personal reasons. Under national law, she must show that she has a right to permanent residence under art 16 of the Citizenship Directive. The Secretary of State for Work and Pensions ("the SSWP") appeals from Social Security Commissioner Jacobs, who upheld her claim. The SSWP contend that she had not acquired a permanent right to reside in the United Kingdom because she had not completed five years' continuous residence on or after 30 April 2006, the UK implementation date for the Citizenship Directive.
3. The SSWP argues that the new right of permanent residence which art 16 confers applies only where a person has completed five years' continuous residence on or after the implementation date. The SSWP fears that, if a person can qualify under art 16 through residence wholly before the implementation date, art 16(4) would not apply. If art 16(4) does not apply, she could acquire permanent residence even if, subsequent to completion of five years' continuous residence, she had been outside the United Kingdom for two years or more. We would reject the SSWP's interpretation of art 16. The object of the Citizenship Directive is to facilitate the integration into the host member state of workers and others having strong links through residence with it. To achieve that aim, it is necessary to interpret art 16 so that the right of permanent residence can be acquired on the implementation date in reliance on residence before that date. This does not make art 16 impermissibly retrospective. Moreover, if the five years' residence has to be completed after that date, workers who may have built up many years' residence before the implementation date will be unable to take advantage of art 16 until (in the case of United Kingdom) 30 April 2011. The SSWP's interpretation would weaken rather than strengthen the right of residence of Union citizens, as the Citizenship Directive intends. As to art 16(4), we consider that this must apply consistently whether a person completes her qualifying period of continuous residence before, on or after the implementation date. Accordingly, in our judgment, art 16(4) must be interpreted so that it applies to both groups of persons.
4. Art 16 requires that a person should have resided "legally" for a continuous period of five years before she can acquire the right to permanent residence. In McCarthy v SSHD [2008] EWCA Civ 641, this court concluded that the word "legally" meant in accordance with Community law, not national law, and that it had to be interpreted in accordance with recital 17 of the Citizenship Directive which refers to 5 years continuous residence "in compliance with the conditions laid down in this Directive". The House of Lords has decided to refer questions arising out of that decision to the Court of Justice. If "legally" in art 16 (1) is to be interpreted in accordance with recital 17, then, in our view, it is necessary for the attainment of the objectives of the Citizenship Directive that the conditions referred to in recital 17 should include the conditions laid down in earlier directives conferring rights of residence on workers. Miss Lassal's residence would then qualify.
5. Other arguments are raised by both parties to which we need not refer. In view of the order for reference made in McCarthy, and the need to resolve issues as to the meaning of the Citizenship Directive before determining the SSWP's appeal in this case, we decided that this Court should refer questions to the Court of Justice to elucidate the answers to those issues.


 


SCHEDULE _____________________________________

1. INTRODUCTION

6. 1 This is a reference under Article 234 EC to the European Court of Justice for a preliminary ruling on the question set out below. The reference is made by the Court of Appeal (Civil Division) of England and Wales (Waller, Arden and Moore-Bick LJJ.).

2. BACKGROUND

Summary of facts

7. 1 Ms Taous Lassal was born on 1 August 1979 in Algeria. She is a French national. She came to the United Kingdom to take up work in January 1999. From September 1999 to February 2005, she was either working or unemployed and seeking work in the United Kingdom. It is admitted by the Secretary of State that she was a "worker" for the purposes of Community law throughout the period from January 1999 to February 2005.
8. 2 In February 2005 Ms Lassal left the United Kingdom to visit her mother in France for a period of ten months. Upon her return to the United Kingdom in December 2005, she began to look for work again. She was paid Jobseeker's Allowance from January 2006 until November 2006. In November 2006 she applied for Income Support on the basis that she was pregnant. That application was refused on the ground that she had no right to reside in the United Kingdom.

Procedural history

9. 3 Ms Lassal appealed against the refusal of Income Support and her appeal was allowed by an Appeal Tribunal on 3 September 2007. The Appeal Tribunal decided that Ms Lassal was entitled to Income Support because she had a permanent right to reside in the United Kingdom by virtue of regulation 15(1)(a) of the Immigration (European Economic Area) Regulations 2006 ("the 2006 Regulations").
10. 4 The Secretary of State appealed against that decision to a Social Security Commissioner. On 23 May 2008, Mr Commissioner Jacobs upheld the decision that Ms Lassal had a permanent right of residence. However, he allowed the appeal because the Appeal Tribunal had made findings of fact which were unsupported by the evidence. Because the Secretary of State has now admitted that Ms Lassal was a worker in the period from January 1999 to February 2005, those factual issues are no longer in dispute.
11. 5 The Secretary of State appealed to the Court of Appeal against the decision of Mr Commissioner Jacobs.

3. NATIONAL LAW

Income support

12. 1 Income Support is a means tested benefit for people aged between 16 and 59 who are not required to sign on for Jobseeker's Allowance because, for example, they are in the later stages of pregnancy, incapable of work or lone parents. The statutory basis for Income Support is in the Social Security Contributions and Benefits Act 1992 ("the 1992 Act"). By section 124(1)(b) of that Act, it is a condition of entitlement to Income Support that a person's income should not exceed the "applicable amount", being "such amount or the aggregate of such amounts as may be prescribed in relation to that benefit" (section 135(1) of the 1992 Act). By section 135(2) of the 1992 Act, the power to prescribe applicable amounts includes power to prescribe nil as an applicable amount.
13. 2 By regulation 21 of, and Schedule 7 to, the Income Support (General) Regulations 1987, the applicable amount prescribed for a "person from abroad" is nil (with the result that such a person has no entitlement to income support). "Person from abroad" is defined in regulation 21AA as "a claimant who is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland". By regulation 21AA(2), no claimant is to be treated as habitually resident in the United Kingdom unless he has a "right to reside" there. "Right to reside" is not expressly defined, but it is common ground that a permanent right of residence arising under regulation 15(1)(a) of the 2006 Regulations is a right to reside for those purposes.

Immigration law

14. 3 The 2006 Regulations came into force on 30 April 2006. They were intended to implement in national law the provisions of Directive 2004/38/EC of the European Parliament and of the Council of 29 April 2004 on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States ("the Directive").
15. 4 Regulation 15 of the 2006 Regulations provides as follows:

15.— Permanent right of residence

(1) The following persons shall acquire the right to reside in the United Kingdom permanently—

(a) an EEA national who has resided in the United Kingdom in accordance with these Regulations for a continuous period of five years;

(b) a family member of an EEA national who is not himself an EEA national but who has resided in the United Kingdom with the EEA national in accordance with these Regulations for a continuous period of five years;

(c) a worker or self-employed person who has ceased activity;

(d) the family member of a worker or self-employed person who has ceased activity;

(e) a person who was the family member of a worker or self-employed person where—

(i) the worker or self-employed person has died;

(ii) the family member resided with him immediately before his death; and

(iii) the worker or self-employed person had resided continuously in the United Kingdom for at least the two years immediately before his death or the death was the result of an accident at work or an occupational disease;

(f) a person who—

(i) has resided in the United Kingdom in accordance with these Regulations for a continuous period of five years; and

(ii) was, at the end of that period, a family member who has retained the right of residence.

(2) Once acquired, the right of permanent residence under this regulation shall be lost only through absence from the United Kingdom for a period exceeding two consecutive years.

(3) But this regulation is subject to regulation 19(3)(b).

16. 5 Paragraph 6 of Schedule 4 to the 2006 Regulations provides:

Any period during which a person carried out an activity or was resident in the United Kingdom in accordance with the 2000 Regulations shall be treated as a period during which the person carried out that activity or was resident in the United Kingdom in accordance with these Regulations for the purpose of calculating periods of activity and residence under these Regulations.

17. 6 The "2000 Regulations" referred to are the Immigration (European Economic Area) Regulations 2000, which are now revoked. Under those regulations, a person who was, inter alia, a worker was entitled to a right of residence (Regulations 5(1) and 14(1)). The 2000 Regulations came into force on 2 October 2000. The 2006 Regulations do not make any provision allowing for periods of residence prior to 2 October 2000 to count towards the right of permanent residence conferred by regulation 15(1)(a).

4. COMMUNITY LAW

18. 1 The Directive provides for a right of permanent residence for Union citizens and their family members in certain situations.
19. 2 Recital 17 to the Directive provides:

Enjoyment of permanent residence by Union citizens who have chosen to settle long term in the host Member State would strengthen the feeling of Union citizenship and is a key element in promoting social cohesion, which is one of the fundamental objectives of the Union. A right of permanent residence should therefore be laid down for all Union citizens and their family members who have resided in the host Member State in compliance with the conditions laid down in this Directive during a continuous period of five years without becoming subject to an expulsion measure.

20. 3 The general rule as to the right of permanent residence is set out in Article 16 which provides:

Article 16

General rule for Union citizens and their family members

1. Union citizens who have resided legally for a continuous period of five years in the host Member State shall have the right of permanent residence there. This right shall not be subject to the conditions provided for in Chapter III.

2. Paragraph 1 shall apply also to family members who are not nationals of a Member State and have legally resided with the Union citizen in the host Member State for a continuous period of five years.

3. Continuity of residence shall not be affected by temporary absences not exceeding a total of six months a year, or by absences of a longer duration for compulsory military service, or by one absence of a maximum of twelve consecutive months for important reasons such as pregnancy and childbirth, serious illness, study or vocational training, or a posting in another Member State or a third country.

4. Once acquired, the right of permanent residence shall be lost only through absence from the host Member State for a period exceeding two consecutive years.

5. CONTENTIONS OF THE PARTIES

The Secretary of State for Work and Pensions

21. 1 The Secretary of State contends that Ms Lassal does not have a right of permanent residence in the United Kingdom. He argues that Ms Lassal has not acquired a right of permanent residence under the 2006 Regulations, and that those regulations properly implement the Directive. The central submission is that a continuous period of five years' residence in the United Kingdom by an EEA national which came to an end prior to 30 April 2006 cannot give rise to such a right. On the facts of Ms Lassal's case:

5.1.1 She was residing in accordance with the 2000 Regulations for the period between those Regulations coming into force (2 October 2000) and her departure for France in February 2005;

5.1.2 She then left the United Kingdom for a period of approximately 10 months and accordingly was no longer in a period of continuous residence;

5.1.3 She returned to the United Kingdom in December 2005 and therefore by the time of her claim for Income Support in November 2006 had been continuously resident in the United Kingdom for only 11 months.

22. 2 The Secretary of State contends that that result is consistent with the Directive, which in his submission provides that a period of five years' residence in the United Kingdom by an EU citizen which came to an end prior to the implementation date of the Directive on 30 April 2006 cannot give rise to a permanent right of residence in the United Kingdom.
23. 3 The Secretary of State's position is that for the purposes of Article 16 of the Directive, at most only continuous periods of residence^[1] of five years ending on or after 30 April 2006 may be taken into account. That is because the Article 16 right could not have been acquired (nor, indeed, could it have been acquired and then subsequently lost) at any date prior to 30 April 2006 - the date upon which the new right was enacted.
24. 4 The Secretary of State contends for that interpretation of the Directive for the following reasons:

5.4.1 If the Directive were to contemplate the right of permanent residence arising by a period of residence wholly prior to 30 April 2006, it would apply to any five year period of residence, regardless of how long ago that was. That is because (a) the right to permanent residence can only be acquired on or after 30 April 2006, the implementation date for the Directive; (b) Article 16(4), which provides that "once acquired" the right is to be lost after two years' absence, cannot be taken to apply retrospectively to periods prior to 30 April 2006: a right cannot be lost when it has not yet been acquired.

5.4.2 Further, such an interpretation would require acceptance, for example, of the proposition that a person having had five years' continuous residence between (say) 1994 and 1999, followed by an absence of more than two years, had (i) acquired and then (ii) lost the right of permanent residence under the Directive, before such a right had even been introduced.

25. 5 Alternatively, the Secretary of State contends that the Directive, because it introduces a new right, only requires periods of residence from 30 April 2006 onwards to be taken into account. That is in accordance with recital 17, which provides that the right is to be acquired only on the basis of residence in compliance with the conditions laid down in the Directive - which conditions are only laid down with effect from 30 April 2006.

The Child Poverty Action Group

26. 6 Ms Lassal did not appear before the Court of Appeal and was not represented. The Child Poverty Action Group ("CPAG") was given leave to intervene by the Court of Appeal and made submissions on her behalf.
27. 7 CPAG contends that the Secretary of State is wrong to contend that "a continuous period of five years" in Article 16 of the Directive cannot include periods of residence which wholly pre-date the transposition date of 30 April 2006. CPAG contends that the Secretary of State's interpretation would logically lead to the conclusion that any EU citizen who has resided in the United Kingdom, in exercise of Community rights, for over five years but who was not resident for a temporary period including 30 April 2006 could not take the benefit of right of permanent residence.
28. 8 CPAG contends that the purpose of the permanent right of residence is to be a vehicle for integration. The Directive should be understood to benefit those people who have formed strong links with the host Member State prior to transposition of the Directive.
29. 9 CPAG contends that the Secretary of State's alternative submission, that the Directive only requires periods of residence which are wholly after 30 April 2006, is unarguable. It would mean that no-one could acquire the right prior to 30 April 2011.
30. 10 It follows, CPAG contends, that the 2006 Regulations fail properly to implement the Directive because they do not allow a period of residence which pre-dates the commencement of the 2000 Regulations to be taken into account. Ms Lassal's residence for a period in excess of five years between September 1999 and February 2005 should be recognised in national law as conferring the right of permanent residence. At no time since February 2005 has she been absent from the United Kingdom for more than two years.

6. THE REASON FOR MAKING A REFERENCE

31. 1 To dispose of the case before it, the Court of Appeal needs to ascertain the correct interpretation of Article 16 of the Directive.
32. 2 Article 16 of Directive 2004/38/EC requires that a person should have resided "legally" for a continuous period of five years before she can acquire the right to permanent residence. In McCarthy v SSHD [2008] EWCA Civ 641, the Court of Appeal concluded that the word "legally" meant in accordance with Community law, not national law, and that it had to be interpreted in accordance with recital 17 of the Directive which refers to five years' continuous residence "in compliance with the conditions laid down in this Directive". The House of Lords in McCarthy has decided to refer questions arising out of that decision to the European Court of Justice. It is likely that those questions will include a question as to whether a person has "resided legally" in the host Member State for the purpose of Article 16 of the Directive in circumstances where she was unable to satisfy the conditions laid down in the Directive (particularly Article 7 thereof).
33. 3 If "legally" in Article 16 (1) is to be interpreted in accordance with recital 17, the question arises whether the reference to the "conditions laid down in this Directive" should or should not be interpreted to include a reference to conditions laid down in earlier Community law instruments conferring rights of residence on workers. The Court of Appeal's own view is that it should be so interpreted (judgment §4). Ms Lassal's residence would then qualify. (On the other hand, if the reference is to be interpreted as referring only to residence in accordance with the Directive itself, Ms Lassal's residence would not qualify.)
34. 4 The Court of Appeal does not, however, consider the question of the temporal scope of the right to permanent residence in the Directive to be acte clair. It therefore considers it appropriate to refer that question to the European Court of Justice.

7. THE QUESTION REFERRED

35. 1 In circumstances where (i) an EU citizen came to the United Kingdom in September 1999 as a worker and remained as a worker until February 2005 (ii) the EU citizen then left the United Kingdom and returned to the Member State of which she is a national for a period of 10 months (iii) the EU citizen returned to the United Kingdom in December 2005 and resided there continuously until November 2006, when she made a claim for social security assistance:

Is Article 16(1) of Directive 2004/38 of the European Parliament and the Council of 29 April 2004 to be interpreted as entitling that EU citizen to a right of permanent residence by virtue of the fact that she had been legally resident, in accordance with earlier Community law instruments conferring rights of residence on workers, for a continuous period of five years which ended prior to 30 April 2006 (the date by which Member States had to transpose the Directive)?

ORDER _____________________________________

Upon hearing Counsel for the Appellant and Leading Counsel for the Intervener (the Respondent neither appearing nor being represented), IT IS ORDERED that:

36. The question set out at paragraph 7.1 of the Schedule to this Order be referred to the Court of Justice of the European Communities ("ECJ") for a preliminary ruling in accordance with Article 234 of the EC Treaty.
37. The proceedings be stayed until the ECJ has given a preliminary ruling on the question referred to it or until further order.
38. Costs be reserved.

Note 1   The Secretary of State’s case is that a period of continuous residence for this purpose might include a period during which a citizen (or family member) was in fact absent from the host Member State, but during which continuity of residence was preserved by Article 16(3) of the Directive. Thus, for example, a temporary absence of less than six months for a period including the implementation date of the Directive might not prevent the right of permanent residence from being acquired.    [Back]