England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		The Law Courts Openshaw Place Ringway Preston PR1 2LL
		Wednesday 27 November 2002

Mr Justice McCombe:

(A) Outline of the Application

1. This is an application for judicial review by Mr Pahalam Gurung ("Mr Gurung"), Mr Hukumsing Pun ("Mr Pun"), Mr Gaurisor Thapa ("Mr Thapa") brought by permission of Hooper J, granted on 28 August 2002. All three Claimants are Nepalese nationals. They are now aged 81, 85 and 82 respectively. They each were recruited in Nepal in the Army raised by the British colonial power in India known as the Government of India for service in "the Indian Army" and became members of the Gurkha rifle brigades. Mr Thapa describes the process of his recruitment as follows:

2. "……The Gallawalas ('The Recruiters') came to my village and told me that I had the chance to become a Lahore (meaning a soldier). I was young, thought that this was a good idea and agreed. I was asked to leave Nepal for the place of enrolment which was Gorakhapur in India. I believed that I was being enrolled into the British Indian Army. This was for two very good reasons: first, when I got to Gorakhapur all the officers and soldiers were British and second that impression was backed up by my knowledge that at the time India was ruled by the British and so it was not strange for me to be enrolled in India by British soldiers and officers of the Indian Army.

3. After I was enrolled I had about one years training. I was trained by British officers and soldiers. As I successfully passed the training period I was asked to take an oath to the King of Britain. We were all asked to put on our battledress and we as a company (which is about 150 men) attended a joint ceremony of oath taking on the parade ground. The commanding officer, a colonel, read out the oath to the British King in Hindi. We were all asked to repeat the oath after him. With this passage of time and bearing in mind my age I cannot now remember the words we were asked to repeat. I do recall that I was giving an oath to obey British command and to go where I was asked by the British and to do what the British asked me to do, that is, to follow British orders."

2. Each of the Claimants served in the Army in the campaigns against the Japanese in the course of the Second World War. Each was captured by the Japanese and remained a prisoner of war ("P.O.W") until the end of the war. The evidence that they give in their witness statements tells of ill treatment that they received at the hands of their Japanese captors. Mr Pun and Mr Thapa left the Army shortly after the end of the war; Mr Gurung joined the British Army, following Indian/Pakistani independence and served in the Gurkha brigade of that Army until his discharge with the rank of Captain in 1964.
3. Each Claimant applies for judicial review of the decision of the defendant to exclude him from the scheme of "ex gratia" payments of compensation to former P.O.Ws of the Japanese announced by it in November 2000. The applications are based upon two grounds: first, on the basis that the Defendant's decision to deny compensation is "irrational" as infringing common law principles of equality of treatment, and secondly, on the basis that the decision infringes the Claimants' rights under Articles 14 and 8 of the European Convention on Human Rights ("ECHR").

(B) The 2000 Payments Scheme

4. The payment scheme was introduced after considerable political pressure had been brought upon successive UK governments to provide some financial compensation to British P.O.Ws of the Japanese. The latest pressure of this type came from a delegation of the Royal British Legion that met the Prime Minister and Dr. Lewis Moonie, Under-Secretary of State for Defence at Downing Street on 10 April 2000.
5. Until that time the policy of H.M. Government over many years had been not to pay compensation to former British service personnel in respect of their experiences as P.O.Ws. I was told that the emphasis had been on paying pensions and providing health care to those whose health had suffered by reason of their service.
6. Following the meeting in April 2000 the Prime Minister initiated a review of this policy and an inter-departmental working group was set up on 25 October 2000. This group advised Ministers. A note for Ministers produced by the group, dated 2 November 2000, was in evidence. On 6 November 2000 a decision was taken to set up an ex gratia payment scheme, to be administered by the War Pensions Agency. On 7 November 2000 Dr Moonie announced this decision to Parliament in the following terms:

" I am very pleased to be able to inform the House that, as a result of the review, the Government have decided to make a single ex gratia payment of £10,000 to each of the surviving members of the British groups who were held prisoner by the Japanese during the Second World War, in recognition of the unique circumstances of their captivity. In cases in which a person who would have been entitled to the payments has died, the surviving spouse will be entitled to receive it instead…

Those who will be entitled to receive the payment are former members of Her Majesty's armed forces who were made prisoners of war, former members of the Merchant Navy who were captured and imprisoned, and British civilians who were interned. Certain other former military personnel in the colonial forces, the Indian army and the Burmese armed forces who received compensation in the 1950s under the United Kingdom auspices will also be eligible. As I said earlier, in cases which a person who would have been entitled to the payment and died, the surviving spouse will be entitled to receive it instead.

We estimate that up to 16,700 people may be eligible for the ex gratia payments, which will accordingly cost up to £167 million to make…

The Government recognise that many UK citizens, both those serving in the armed forces and civilians, have had to endure great hardship at different times in different circumstances but the experience of those who went into captivity in the far east during the Second World War was unique …"

(see witness statement of 10 October 2002, Mr T McKane for the Defendant, paragraph 3.4, p.168 of the bundle)

7. As can be seen, Dr Moonie stated that a relatively small number of people who had served in armed forces other than those of the United Kingdom, such as the Indian Army, would be eligible for a payment (see McKane, paragraph 3.5, page 168 of the bundle).
8. On 30 November 2000, the Minister was asked in Parliament how many members of Gurkha regiments who were P.O.Ws of the Japanese and their widows, would receive payments under the scheme. The response was :

" Prior to 1947 there were no Gurkha regiments in the British Army. The (old) Indian Army, which included Gurkha regiments, was separate from the British army and responsibility for it passed to the new Governments of India and Pakistan when those countries became independent. Former members of the (old) Indian Army generally did not receive payments under UK auspices under the 1951 San Francisco Treaty of Peace with Japan and are not eligible for the current ex gratia scheme."

(see McKane, paragraph 3.6, p.169 of the bundle).

9. Thereafter, the eligibility criteria for the scheme were defined as follows:

" (a) surviving former members of the UK Armed Forces who were held as prisoners of war by the Japanese during the Second World War;

(b) surviving former servicemen who received payments under Article 16 of the 1951 Treaty of Peace with Japan, under the auspices of the UK Government;

(c) surviving members of the Merchant Navy (that is, persons who were employed or engaged on or for service as mariners in a British ship) who were imprisoned by the Japanese in the Far East during the Second World War;

(d) surviving British civilians, who were born in the UK or had a parent or grandparent born in the UK, who were interned by the Japanese during the second World War; and

(e) the surviving widow or widower of a deceased person who would otherwise have been entitled under category a), b), c) or d), providing that they were still married at the time of death.

(see McKane paragraph 4.1, p.169-170).

The claimants did not fall within any of these categories. The evidence estimated that about 650 people were in a similar position to the Claimants. At the hearing the Claimants counsel submitted a list of some 300 names.

(C) The Reasoning Process

10. It will be seen from the Minister's answer of 30 November 2000 that the old Indian Army, which included the Gurkhas was separate from the British Army and, it was said, responsibility for the former passed to the Governments of India and Pakistan upon independence. However, certain British officers and other ranks served in the Indian Army. Those of them who were P.O.Ws of the Japanese received payments under Article 16 of the 1951 Treaty and received or will receive payments under the new scheme. The Gurkhas received no payments under the 1951 treaty and will receive no payments now. Why is this so? The answer given by the Defendant was that the British officers and other ranks that served in the Indian Army "in common with members of the UK Armed Forces, were subject to the Army Act and to British Military Law. All other members of the Indian Army, including the Claimants, were subject to Indian Military law": (see McKane paragraph 5.3, p.171 of the bundle).
11. The 1951 Treaty was that made at San Francisco between "the Allied Powers" and Japan on 8 September 1951. The United Kingdom's ratification thereof was deposited on 3 January 1952. Article 25 of the Treaty defined the term "the Allied Powers" as follows:

"For the purposes of the present Treaty the Allied Powers shall be the States at war with Japan, or any State which previously formed a part of the territory of a State named in Article 23, provided that in each case the State concerned has signed and ratified the Treaty……"

Article 23 provides:

" (a) The present Treaty shall be ratified by the States which sign it, including Japan, and will come into force for all the States which have then ratified it, when instruments of ratification have been deposited by Japan and by a majority, including the United States of America as the principal occupying Power, of the following States, namely Australia, Canada, Ceylon, France, Indonesia, the Kingdom of the Netherlands, New Zealand, Pakistan, the Republic of the Philippines, The United Kingdom of Great Britain and Northern Ireland and the United States of America…."

It was not suggested that "the Allied Powers" included any State not mentioned in Article 23. On this basis it will be noted that neither India nor Nepal were parties.

12. On 9 June 1952 India concluded its own Peace Treaty with Japan (see pp.149 – 151 of the bundle). By Article VI of that Treaty, it was agreed as follows:

"(a) India waives all reparation claims against Japan.

(b) except as otherwise provided in this Treaty, India waives all claims of India and Indian nationals arising out of action taken by Japan and its nationals in the course of the prosecution of the war and also claims of India arising from the fact that it participated in the occupation of Japan"

13. It appears that following the conclusion of the 1951 Treaty the process began of compiling lists of persons who would qualify for benefits under the funds resulting from the application of Article 16. The question then arose as to the position of "European Officers and non-Commissioned Officers of the former Indian Army." In 1953 the case was made for the inclusion of these persons in the relevant lists. The reasoning can be seen from two letters exhibited to the witness statement of Mr McKane. The first letter is that of a Mr G.D. Anderson at the Commonwealth Relations Office, dated 8 August 1953 and addressed to Mr P.D.Stobart of the Japan and Pacific Department of the Foreign Office. (That letter refers in its first paragraph to an earlier letter of 4 July 1953 from the writer, which is not in evidence). The second letter is Mr Stobart's reply. The letters are worth quoting in full. The first letter was in these terms:

"Would you please refer to my letter No. FE59/60/1 of 4^th July about the eligibility of European Officers and Non-Commissioned Officers of the former Indian Army for benefits under Article 16 of the Japanese Peace treaty.

2. By Section 73 of the Government of India Act, 1833 the power to legislate for the "native" Army was restricted to the Governor-General in Council and laws so made were given general application to all "native" officers and soldiers wherever serving. This provision was continued in later enactments and remained in force up till the transfer of power when the European element of the Indian Army disappeared. The Military Code for the Indian officers and men of the Indian Army was contained in the Indian Army Act, but this did not subject European officers and soldiers to Indian Military Law. Such persons were subject to the British Army Act. The European officers were admittedly part of His Majesty's Indian Forces, but by both their origin and their governance ( the United Kingdom Army Act) they were treated as bodies raised in the United Kingdom and quite separate from "natives" of India.

3. This distinction between the European and the Indian element of the Indian Army was always clear-cut and precise and has never occasioned any difficulty. For instance, in 1950 we obtained the agreement of the Treasury to the application to the European officers of the Indian Army of the Armed Forces Scheme for Compensation for loss of effects by officers of the British Army in the Far East. In the discussion which lead to agreement on this question the possible repercussion in regard to Indians was raised, but was answered sufficiently by the facts that the United Kingdom Government had no jurisdiction over "native" troops, and that the question of compensation for them was one which rested properly on the Government of India.

4. We hope you will agree that the above, read in conjunction with my letter to Peters of the 4^th April, provides us with ample arguments for rebutting any Indian claim for similar treatment for Indian troops, and for satisfying the international Committee of the Red Cross if necessary.

5. In any case, it seems to us most unlikely that the Government of India will make a claim. They have put themselves out of court by signing a separate Treaty with Japan which waives any claim in this matter and they must be conscious of the ridicule which they would bring on themselves if they made a claim on behalf of men many of whom behaved so badly while prisoners of war.

6. We therefore suggest that we should include European members of the former Indian Army in our lists and be ready to defend their inclusion with more robustness than your letter of 15^th May suggests."

The second letter read:

"Thank you for your letter to Stobart (PE59/60/1) of August 8 about the eligibility of members of the former Indian Army for benefits under Article 16 of the Japanese Peace Treaty. We have discussed with our Legal Advisers the points made in paragraphs 2-3 of your letter, and agree that taken together with the points in paragraph 4 of your letter to Peters of April 8 (PE/59/68/1), they provide us with a very good case for including European officers and Non-Commissioned officers of the former Indian Army in the lists which are being prepared for the purposes of Article 16, and for distinguishing such officers and N.C.O.'s from non-Europeans serving in the Indian Army who were subject to the Indian Military Code."

The distinction made is between European and "native" personnel. There is reference to India having waived "any claim in this matter". There is no reference to the Gurkhas.

14. The position of the Gurkhas was raised directly in 1955. Correspondence was exchanged between the same Mr Anderson and a Mr H.A.H Cortazzi of the Foreign Office. The letters are dated 1 and 13 January 1955 and are in the following terms:

"Our short reply to your correspondence with the War Office about Gurkhas (your letter to Murray of the 16^th December and Murray's reply of the 21^st December) is that, in our view, it would appear to be legally wrong and politically undesirable, in the wider context of our relations with India, to regard former Gurkha prisoners of war as eligible for benefit under Article 16 of the Japanese Peace Treaty.

2. On the legal aspect, neither the Gurkha's country of domicile (Nepal) nor the country in whose armed forces they were serving at time of capture (India) was a signatory of the Japanese Peace Treaty and this criterion would appear to render them prima facie ineligible. It was indeed for this reason alone that non-European members of the former Indian Army who are now Nationals of the Republic of India were ruled out as ineligible for benefit. Indeed their ineligibility by virtue of this criterion was felt to be so obvious that we did not think it necessary to consult the Government of India officially on the matter.

3. As you know for the reasons advanced in

(a) my letter to Peters FE. 59/60/1 of 2^nd April 1953;

(b) my letter to Stobart of 8^th August, 1953

(c) Bishop's letter to Pilcher of 24^th August, 1953

it was decided to include in the United Kingdom's own list the 800 or more European officers etc. of the former Indian Army.

4. There is no analogy of any sort between the status of European members of the former Indian Army and that of Nepalese members of the Indian Army. The "native" personnel of the Indian Army was recruited from Ahirs, Dogras, Garhwalis, Gurkhas, etc. and the fact that the Gurkhas, coming from the independent Kingdom of Nepal, were recruited under special treaty arrangements made no difference whatever to their status when mustered into the Indian Army. They were paid like any other Indian sepoy, and were subject to the same code of discipline (the Indian Army Act). They held the same non-Commissioned ranks, and were, promoted to be Viceroy's Commissioned Officers, and Indian Commissioned Officers in the same way as any other sepoy. We can think of no respect in which the Gurkha troops could be said to approximate to United Kingdom troops. The statements in my letter of 8^th August 1953 to Stobart apply with equal force to Gurkhas.

5. It seems to us that the criterion for eligibility under Article 16 should surely be the status of the soldier at the time of his capture and imprisonment and not any different status which he may subsequently have attained after release. Thus, the status of the former Gurkha prisoners of war must be held to be that of "native" officers and soldiers of the Indian Army. The fact that since the war some Gurkhas were transferred to the British Army cannot be held to have had any retrospective effect on their previous status. Any Nepalese natives (ex prisoners of war) who were drafted into "British Gurkhas" on the transfer of power had, in relation to the matter under discussion, the same status at the relevant time as Gurkha troops who were not so drafted. In other words we can see no reason why Gurkha troops (whether serving now in the Indian or British Army) should be treated, in relation to Article 16, as being any way different from other Indian recruits.

6. The political reasons for not attempting to include British Gurkhas under Article 16 hardly need stressing. We are dependant to a very great extent on active Indian goodwill and co-operation for the continuance of Gurkha recruitment for the British Army and the Indian authorities might well question our motives if we attempted to extend to British Gurkhas benefits which it has not been Indian policy to claim on behalf of Indian troops including Indian Army Gurkhas.

7. Possibly awkward situations are likely to arise in which British officers serving in the Gurkha Brigade will be eligible for benefit under Article 16 whereas some of their Gurkha troops or fellow officers (who had conceivably been in the same prisoner of war camp as the British officer) will not be eligible. A possible approach to such difficulties might be for the British officers concerned to be instructed to preserve a discreet silence as to the fact of their own inclusion in the United Kingdom list of potential beneficiaries.

8. In the light of the above we suggest that the various enquiries which the War Office have set on foot (Murray's letter to you of 21^st December and his signal to Headquarters brigade of the Gurkhas in Malaya) should be countermanded without delay.

15. It is to be noted that because neither the Gurkha's country of domicile (Nepal) nor the country in whose armed forces they were serving (India) was a signatory to the 1951 Treaty they were prima facie ineligible. Further, it can be seen that it was "for this reason alone" that non-European members of the former Indian Army who were Nationals of the Republic of India were ruled out as ineligible for benefit. The fact that neither Nepal nor the new state of India were parties to Article 16 arrangement seems, on its face, a strange criterion for defining or limiting responsibility of the State in whose colonial army the Gurkhas served. Moreover, it appears clear from paragraph 7 of the letter of 1 January 1955 that the embarrassment of Government in justifying the distinction made was clearly felt in 1955.
16. To continue with the eligibility criteria of the 1950s, it appears that, apart from members of the UK Armed Forces and the European members of the Indian Army, the compensation arising under Article 16 was also applied for the benefit of

"Former members of forces raised in areas which were still British Colonies when the Treaty of Peace with Japan was signed in 1951 and for whom the UK Government therefore took responsibility in the 1950s…. This category included former members of the Straits Settlement Volunteer Force, the Federated Malay States Volunteer Force and the Hong Kong Volunteer Defence Corps who were imprisoned by the by the Japanese…" (McKane, paragraph 6.3(1) pp.173-4 of the bundle).

17. Apparently, the decision made in 2000 was to make payments to members of the UK Armed Forces who had been P.O.Ws of Japan. The Government decided not to make payments to former members of the armed forces of other countries, except to the very limited extent of allowing claims by those who received compensation in the 1950s under UK auspices: McKane, paragraph 6.2, page 173 of the Bundle. The crux of the reasoning seems to have been that:

"Ministers considered that those who had been sufficiently associated with the UK in the 1950s to be included in the compensation scheme alongside UK service personnel should be eligible for ex gratia payments. It seemed sensible to maintain consistency of approach by including all categories of individuals who had been eligible for compensation under the 1950s scheme. By mirroring the 1950s scheme, insofar as seemed reasonable, the scheme was made administratively workable with a minimum of expense. The Veterans Agency (formerly War Pensions Agency) was generally able to check the entitlement of former prisoners of war against the records of those who received compensation under UK auspices in the 1950s [pages 46-57 of exhibit TMK1].

(McKane paragraph 6.4 page 174)

18. There appears to have been little, if any, attempt to determine why, in 2000, the Gurkhas should be treated in exactly the same way as the embarrassed letter of Mr Anderson in 1955, indicated that they were to be treated in that year.
19. The line was drawn between persons governed by one military code as opposed to another (ie. UK or India). I shall return below to the basis of making that disciplinary distinction in the first place. As will appear, it seems clear to me that the relevant reasoning was racial in nature. It is, however, far from clear to me whether that was apparent to the decision makers in 2000.
20. It seems also that the decision to exclude the Gurkhas from the new scheme was influenced by a concern that, otherwise, the gate might be open to claims from former servicemen who were nationals of, for example, Australia, New Zealand, Canada and South Africa. The summary grounds of opposition to the present claims apparently stated, " the cost of extending the criteria in this manner would be likely to run to hundreds of millions of pounds…." as the scheme would extend to all other former personnel who were serving in British Imperial forces who were captured by the Japanese. Further particulars of this statement were required which drew a response from the defendant's solicitors setting out figures relating to Australia, Canada, New Zealand, South Africa and the Indian Army: see pp. 159-161 of the bundle.
21. Further, Mr McKane says in his evidence for the Defendant that,

"Soon after Dr Moonie announced the setting up of the scheme, we received some complaints that former Gurkhas who had served in the Indian Army were not eligible to receive ex gratia payments. Consequently, the inter-departmental working group considered this issue on 22 November 2000 [pages 58-62 of exhibit TMK1]. We were of the view that there was no valid distinction between former Gurkhas and any other former prisoners of war held by the Japanese who had been serving in the armed forces raised throughout the British Empire and so it would have been inappropriate to make any dispensation for former Gurkhas. As I have stated above, Dr Moonie subsequently confirmed in Parliament that former members of the Indian Army, including former Gurkhas, were not eligible for an ex gratia payment unless they had received previous payments under British auspices as a result of the 1951 Peace treaty.

(McKane, paragraph 6.9, page 176)

It is clear that when Mr McKane refers to the British Empire in this context, he includes Canada, Australia and New Zealand: see paragraph 6.12 of the witness statement, page 177 of the bundle.

22. It does not seem to be controversial, however, that the forces of Australia, Canada, New Zealand and South Africa were recruited by the independent Dominion governments of those countries and went to war following independent declarations of war by their Governments. Further, three of them were parties in their own right to the 1951 Treaty and the same three (South Africa being the exception in each case) have instituted their own compensation schemes.

(D) The Military Discipline distinction

23. I turn to the differing military codes affecting the British Army and the Indian Army which lay at the root of the decision excluding the Gurkhas from compensation payment in the 1950s and now.
24. On this subject I was taken to the Army Act 1881, as re-enacted and amended, as it appeared in the 1930 edition of Halsbury's Statutes of England. The relevant provisions are labyrinthine in character. Part V of the Act deals with "Persons subject to Military Law". They are divided by sections 175 and 176 with "Persons subject to Military Law as Officers" and "Persons subject to Military Law as Soldiers" respectively.

Section 175 provided:

"Persons subject to military law as officers. – The persons in this section mentioned are persons subject to military law as officers, and this Act shall apply accordingly to all persons so specified; that is to say, …

(7) Every person not otherwise subject to military law who, under the general or special orders of the Army Council or of the Governor-General of India, accompanies in an official capacity equivalent to that of any of His Majesty's troops on active service in any place, subject to this qualification, that where such person is a native of India he shall be subject to Indian military law as an officer. …

(11) All officers belonging to a force raised in India or a colony, when attached to or doing duty with any portion of the regular, reserve, or auxiliary forces in the United Kingdom:

(12) All officers of a force raised in India or a colony, to which this Act is, in whole or in part, applied by the law of India or the colony, at such times and subject to such adaptations, modifications, and exceptions as may be specified in such law. "

"176. Persons subject to military law as soldiers. – The persons in this section mentioned are persons subject to military law as soldiers, and this Act shall apply accordingly to all the persons so specified; that is to say, …….

(3) All non-commissioned officers and men serving in a force raised by order of His Majesty beyond the limits of the United Kingdom and of India, and serving under the command of an officer of the regular forces:

Provided that nothing in this Act shall affect the application to such non-commissioned officers and men of any Act passed by the legislature of a colony:……..

(8A) All non-commissioned officers and men belonging to a force raised in India or a colony when attached to or otherwise acting as part of or with any portion of the regular, reserve, or auxiliary forces in the United Kingdom:…..

(10) All persons not otherwise subject to military law who are followers of or accompany His Majesty's troops, or any portion thereof, when employed on active service; subject to this qualification that, where any such persons are employed by forces, consisting partly of His Majesty's Indian forces subject to Indian military law, and such persons are natives of India, they shall be subject of Indian military law:

(11) All non-commissioned officers and men belonging to a force raised in India or a colony to which this Act is, in whole or in part, applied by the law of India or the colony, at such time and subject to such adaptations, modifications, and exceptions as may be specified in such law."

Section 180 of the Act provided for "Modification of the Act with respect to His Majesty's Indian Forces" and enacted the following:

Modification of Act with respect to His Majesty's Indian forces. –

(2) In the application of this Act to His Majesty's Indian forces the following modifications shall be made:-

(a) Nothing in this Act shall prejudice or affect the Indian military law respecting officers or soldiers or followers in His Majesty's Indian forces, being natives of India; and on the trial of all offences committed by any such native officer, soldier, or follower, reference shall be had to the established usages of the service, but courts-martial for such trials may be convened in pursuance of this Act:

(b) For the purposes of this Act the expression "Indian military law" means the Articles of War or other matters made, enacted, or in force, or which may hereafter be made, enacted, or in force under the authority of the Government of India; and such articles or other matters shall extend to such native officers, soldiers, and followers wherever they are serving:…."

The definition section yielded up the following s.190 (22):

"The expression "native of India" means a person triable and punishable under Indian military law as defined by this Act.

That takes one back to s.180 (2).

25. Counsel's researches took me to a footnote in Volume XXV of Halsbury's Laws of England (1913) for the application of the Indian Articles of War. The note refers to s.180 (2) of the Army Act and continues as follows:

" The term "native of India" is defined by ibid. s.190 (22) as meaning a person triable and punishable under Indian military law. The Indian Articles of War do not apply to any British born subject, or to any legitimate Christian lineal descendant of the same, whether in the paternal or maternal line."

Section 180 (2) (b) is cited as are references to the Indian Articles of War of 1865 and an amendment of 1894.

26. Mr Blake QC (for the Claimants) referred me to the Indian Code of Criminal Procedure 1898 which appears to have used the term "European British Subject" which applied to Her Majesty's subjects born or naturalised or domiciled in the United kingdom or any of the European, American or Australian Colonies or possessions of Her Majesty, or in the Colony of New Zealand, or in the Colony of the Cape of Good Hope or Natal.
27. Mr Sales, for the defendant pointed out, rightly, that this term was not a provision of the Army Act, with which this Court is concerned, but observed that the definition was not in its terms racial in application.
28. I do not think that this legislation (the Army Act and what we know of the Indian Articles of War) requires analysis "to the nth degree" in the present case. What we are concerned with are questions of alleged irrationality in the decision making process and I find myself convinced that, at the present day, if a decision-maker is considering the application of a distinction of this kind, originally deriving from 19^th century United Kingdom and Colonial legislation, he or she will be concerned with whether the criteria thrown up by such legislation were for practical purposes racial in nature. This would be so whether or not it is technically possible to envisage persons who might fortuitously qualify as, for example, European, in particular circumstances outside the normal run of events. I consider as one such example the hypothetical Indian "sepoy" who became domiciled in the United Kingdom and hence fell outside the Indian penal code.
29. I feel confident that, other things being equal, a decision maker in the year 2000 would not have considered "rational" a criterion of qualification or non-qualification for benefit which, in the broad mass of cases, would hinge upon issues such as the place of birth and colour of skin of the postulant for such benefit. In my view, a selection criteria rooted in this particular 19^th century legislation does suffer from this defect.

(C) Division of Responsibilities after 1947

30. The only other matter of background fact to which I need to refer concerns the arrangements, relating to the Indian Army (including the Gurkhas), that were made upon the advance to independence of India and Pakistan.
31. In his witness statement, paragraphs 5.5 and 5.6 Mr McKane told me that,

" As a result of negotiations between the United Kingdom Government and the new Governments of India and Pakistan, it was agreed that responsibility for claims by personnel from the Indian Army in respect of the period prior to 1 April 1947 was passed to the Governments of India and Pakistan, but that any claims by British personnel relating to the period prior to 1 April 1947 were to be settled by the UK Government."

Reference is made to a document now appearing at pages 216 – 217 of our bundle, to which I shall return.

Mr McKane continued, in paragraph 5.6 and 5.7 of his statement,

"5.6 Accordingly, the UK Government retained responsibility, in respect of the period prior to 1 April 1947, for the British officers and other ranks who had served in the Indian Army subject to the Army Act and under British Military Law. The responsibility for all other members of the Indian Army, in respect of the period prior to 1 April 1947, was passed from the former Government of India to the new Governments of India and Pakistan.

5.7 In accordance with this division of responsibility, when drawing up the list of former prisoners of war who should receive compensation under UK auspices pursuant to Article 16 of the Treaty of Peace with Japan, the UK Government included those personnel who, although they had served in the Indian Army, hade been subject to the Army Act and Indian military Law; responsibility for such personnel lay with the Governments of India and Pakistan……"

32. In paragraph 5.5, Mr McKane did not put a date upon the agreement between the three governments to which he had referred. The document to which he did refer was not the agreement but an extract from the Report on the Accounts of Army Expenditure for 1949/50 and 1950/51. The extract was from Chapter XII entitled "Financial Relations with other Governments" and the section of that chapter which was re-produced was entitled "The Transfer of power in India and Pakistan". It included the following passages:

General.

"The Indian Defence Expenditure plan came to an end on 31^st March, 1947 (see the Report for 1939/46, Volume 1, p. 112). Interim arrangements for the year 1947/48 were negotiated with the Government of India and in the main continued to apply after the transfer of power to the separate governments of India and Pakistan on 15 August 1947. the broad principle on which these arrangements was based was that, as before the war, India bore all the expenditure in connection with troops in India, whether British or Indian, and the United Kingdom Government bore the cost of Indian troops outside India, excluding the bulk of the Indian contingent in Japan……."

Outstanding claims

"Under the general settlement of July,1948, no claims were to be raised by the Governments of India and Pakistan against the United Kingdom Government or vice versa in respect of outstanding transactions relating to the period prior to 1^st April, 1947, except for items not normally dealt with through the Indian Defence Expenditure Plan (e.g .claims by or against the Indian Civil Departments and non-effective payments), and terminal benefits (i.e. war gratuities, release leave pay and allowances, overseas service leave and free issues of civilian clothing). Under a separate agreement a proportion of the total cost of terminal benefits paid to British troops during the late war and up to the end of the war-time release scheme, which represented the ratio of the average number of British troops who were an Indian liability during the war to the average strength of the whole British Army during the same period, was recovered from the Government of India. A similar calculation was made by the government of India to determine the War Office share of the release benefits paid to Indian troops. These adjustments were finally completed in 1948/49.

All other outstanding claims relating to the period prior to 1^st April, 1947, were to be dealt with as follows:-

(i) claims by or against British Service personnel were to be settled by the United Kingdom Government;

(ii) claims by or against Indian and Pakistani Army personnel (including personnel of the Special and Indian Dominion Lists of the British Army) were to be settled by the Indian or Pakistani Government;

(iii) claims by or against other third parties (e.g. contractors) arising in India or Pakistan were to settled by the Indian or Pakistani Government; and

(iv) claims by or against other third parties arising outside India or Pakistan were, with certain exceptions, to be settled by the United Kingdom Government…."

33. From the terms of this document and from the nature of its subject matter, it was far from clear to me that the document was really dealing with questions of claims for compensation that might exist against foreign powers or the distribution of any such compensation to former servicemen. The document appeared to be dealing with matters of accounting for more basic claims by or against service personnel, for example, pensions for which, the evidence indicated, responsibility was taken by the Indian government so far as the Gurkhas were concerned. It was not obvious that the terminology used was apt to cover any hope that servicemen might have of assistance from government as a result of their wartime experiences. It is hard to understand how this document had a bearing upon the distribution of money received under Article 16 of the 1951 Treaty. The 1950s correspondence makes no reference to the document and clearly refers to payment to European officers (and not to Indian members) of the Indian Army of compensation for loss of effects.

(F) The Arguments

34. I have set out above the summary of the challenge to the exclusion of the Claimants from the new scheme above. It is based upon common law principles of rationality, relevance of criteria adopted and upon human rights grounds. I turn to the arguments on "rationality" .

(G) Rationality and relevant considerations

35. I take these matters together because Mr Sales for the Defendant submitted that, in the absence of statutory criteria to be applied to a decision making process, a court cannot determine the relevance or otherwise (and, therefore, the lawfulness or otherwise) of criteria adopted by the decision maker. He accepted, however, that if a criterion adopted by a decision maker was "irrational" this could undermine the lawfulness of a decision, apparently otherwise lawful, on the same grounds of irrationality. For the purposes of the decision in this case, I am content to accept Mr Sales approach on this aspect of the matter. The challenge is founded simply on the basis that the exclusion of the Gurkhas from the scheme was "irrational" in terms of the Court of Appeal's decision in Associated Provincial Picture Houses v Wednesbury Corporation [1948] 1KB 223. Mr Blake relied upon the following passage in de Smith, Woolf and Jowell, Judicial Review of Administrative Action (1995) paragraph 13 – 040

"……equality of treatment has shown itself to be a principle of lawful administration in English law….in the nineteenth century Lord Russell considered that by-laws could be held to be unreasonable because of:

"partial and unequal treatment as between different classes" (Kruse v Johnson [1898] 2 QB 91)

Although subsequent cases did not articulate the principle with equal clarity, unequal treatment has justified a number of instances in which the courts have stood down a decision or provision which infringes equality…."

I was referred to various other materials, both in academic discourse and in the Courts, in which this principle has been examined. I confine myself here to reference to two examples. The first is Short v Poole Corporation [1926] Ch 66. It will be recalled that in that case the Defendant had given a woman teacher notice to terminate her engagement "after satisfying themselves that her husband was able to maintain her". The decision so to act had been reached by the following reasoning: (1) the duty of the married woman was primarily to look after her domestic concerns and the Defendant regarded it as impossible for her to do so and to act effectively and satisfactorily as a teacher at the same time; and (2) that it was unfair to the large number of unmarried teachers who were then seeking employment that such positions be occupied by married women whose husbands could maintain them. The teacher sought a declaration of illegality and an injunction against the Council restraining it from acting upon the notice. Reversing Romer J, the Court of Appeal refused the plaintiff the relief sought, finding that she had failed to establish that the Defendant had failed to take into account matters other than those which belonged to their educational sphere. The judgment of Warrington LJ, included the following passage (at p. 91)

"…It may be also possible to prove that an act of the public body, though performed in good faith and without the taint of corruption, was so clearly founded on alien and irrelevant grounds as to be outside the authority conferred upon the body, and therefore inoperative. It is difficult to suggest any act which would be held ultra vires under this head, though performed bona fide. To look for one example germane to the present case, I suppose that if the defendants were to dismiss a teacher because she had red hair, or for some equally frivolous and foolish reason, the Court would declare the attempted dismissal to be void…… "

I quote that passage and refer to the decision in that case for the proposition that the facts there may well provide an example of a danger of decision makers today adopting a "rationality" based upon the criteria of yesterday. Would an authority reaching such a decision as the Corporation did in 1924 be considered to have acted rationally? The answer must be, "Surely not."

36. My second example is a passage from a lecture given by Lord Steyn on 18 September 2002 in honour of Lord Cooke of Thorndon. At page 18 of the printed copy of the lecture, Lord Steyn says:

"The importance of the development of constitutional rights has not come to an end with the advent of the Human Rights Act. One illustration is sufficient. The anti-discrimination provision contained in Article 14 of the European Convention is parasitic in as much as it serves only to protect other Convention rights. There is no general or free-standing prohibition of discrimination. This is a relatively weak provision. On the other hand, the constitutional principle of equality developed domestically by English courts is wider. The law and the government must accord every individual equal concern and respect for their welfare and dignity. Everyone is entitled to equal protection of the law, which must be applied without fear or favour. Except where compellingly justified distinctions must never be made on the grounds of race, colour, belief, gender or other irrational ground. Individuals are therefore comprehensively protected from discrimination by the principle of equality. This constitutional right has a continuing role to play. The organic development of constitutional rights is therefore a complementary and parallel process to the application of human rights legislation."

I cite that passage in demonstration of the continued force of the common law principle of equality and generality of its application. I emphasise the passage where Lord Steyn says that, "Except where compellingly justified distinctions must never be made on the grounds of race [or] colour".

37. Mr Sales submitted, however, that the Courts must tread warily in this field and he submitted, in reliance upon the decision of the Privy Council in Matadeen v Pointer [1999] 1 AC 98 (a decision relied upon by both sides) that questions of equal treatment are not always justiciable ones. I refer to the passage in the opinion of the Board, delivered by Lord Hoffmann, at page 109:

"As a formulation of the principle of equality, the court cited Rault J. in Police v. Rose [1976] M.R. 79,81: "Equality before the law requires that persons should be uniformly treated, unless there is some valid reason to treat them differently. " Their Lordships do not doubt that such a principle is one of the building blocks of democracy and necessarily permeates any democratic constitution. Indeed, their lordships would go further and say that treating like cases alike and unlike cases differently is a general axiom of rational behaviour. It is, for example, frequently invoked by the courts in proceedings for judicial review as a ground for holding some administrative act to have been irrational: see professor Jeffrey Jowell Q.C., "Is Equality a Constitutional Principle?" (1994) 7 C.L.P. 1, 12-14 and de Smith, Woolf and Jowell, Judicial Review of Administrative Action, 5^th ed. (1995), pp. 576-582, para. 13-036 to 13-045.

But the very banality of the principle must suggest a doubt as to whether merely to state it can provide an answer to the kind of problem which arises in this case. Of course persons should be uniformly treated, unless there is some valid reason to treat them differently. But what counts as treating them differently? And, perhaps more important, who is to decide whether a reason is valid or not? Must it always be the courts? The reasons for not treating people uniformly often involve, as they do in this case, questions of social policy on which views may differ. These are questions which the elected representatives of the people have some claim to decide for themselves. The fact that equality of treatment is a general principle of rational behaviour does not entail that it should necessarily be a justiciable principle – that it should always be the judges who have the last word on whether the principle has been observed. In this, as in other areas of constitutional law, sonorous judicial statements of uncontroversial principle often conceal the real; problem, which is to mark out the boundary between the powers of the judiciary, the legislature and the executive in deciding how that principle is to be applied.

A self-confident democracy may feel that it can give the last word, even in respect of the most fundamental rights, to the popularly elected organs of its constitution. The United kingdom has traditionally done so; perhaps not always to universal satisfaction, but certainly without forfeiting its title to be a democracy. A generous power of judicial review of legislative action is not therefore the essence of a democracy. Different societies may reach different solutions….."

38. The question in that case was whether the Constitution of Mauritius rendered unconstitutional laws giving rise to inequalities outside the grounds set out in the constitution itself. The Privy Council decided that this was not the effect of the Constitution and that, outside its express terms, questions of legitimate justification for other forms of discrimination or classification was a matter for Parliament or, subject to judicial review, to the relevant minister or other decision maker: see pp.110 and 118.
39. This decision obviously leaves intact the common law principle of equality of which Lord Steyn spoke in his lecture. Moreover, given the terms of the Constitution of Mauritius which proscribed discrimination on racial grounds, it can hardly have been thought that concepts of racial discrimination might not be properly justiciable.
40. Mr Sales further cautioned against any usurpation of the functions of Parliament in the control and approval of public expenditure. He cited Dicey's Introduction to a Survey of the Constitution, 10^th edn., pp. 315-8. He submitted that the scheme in the present case has been the subject of Parliamentary scrutiny and it would not be constitutionally legitimate for the courts to alter the criteria, since the Court is not properly equipped to undertake the task of balancing the conflicting claims to scarce resources. The reference to Dicey was principally for the proposition that, " Not a penny of revenue can be legally expended except under the authority of some Act of Parliament". Mr Sales mentioned the Appropriation Acts. His submission was that, in this case, the Minister had made his statement; he had been held to account in Parliament by way of the debate on the statement and, the logic was, Parliament had "approved" the scheme. Mr Sales told me, however, that this was not a case of the scheme having been expressly voted upon. Of course, even a decision in favour of the Claimants does not require the Department to spend a single penny. It would only require a reconsideration of the present matter.
41. Mr Sales is obviously right that the money allocated to this scheme will have had to be provided for expenditure within some category of expenditure approved by Parliament. However, this is not to say that Parliament has expressly approved every detail of this scheme so as to have given a statutory imprimatur to every nuance of it.
42. Mr Sales conceded that the decision making process was amenable to challenge on the grounds of irrationality and, in the end, I think the submission went no further than to advance the inevitable caution that the Court must feel when considering submissions of "irrationality" in matters of this type, where, of course, the decision-makers are accountable to Parliament.
43. Mr Sales further submitted that the Claimants' challenge to their exclusion from the new scheme must be seen in the context that the prime object of it, as seen by the UK Government, was to compensate UK nationals who had been P.O.Ws of the Japanese: they were, he submitted, "the paradigm case". The scheme was only extended in limited exceptional cases to other categories, essentially to those sufficiently closely connected to the United Kingdom so as to warrant an acceptance of responsibility for their treatment at Japanese hands under the 1951 Treaty arrangements. It is clear, however, that some extension was made in the new scheme to the qualifying civilian categories, in that compensation was to be available to such persons who had been under 21 at the outbreak of war with Japan and had, therefore, been excluded from the Treaty compensation arrangements.
44. In summarising the submissions of law under this head, I must refer to the recent decision of Scott Baker J (as he then was) concerning this very scheme. In that case a challenge to the ambit of the new scheme was made by certain civilian claimants, represented by the Association of British Civilian Internees Far East Region ("ABCIFER). The case was referred to in the papers as ABCIFER v Secretary of State for Defence [2002] EWHC 2119 (Admin).
45. The ABCIFER case was brought on behalf of British civilian subjects who were neither born in the United Kingdom nor had a parent or grandparent who had been so born. In the initial announcement the Minister had referred to the scheme as providing compensation to "British civilians" who were interned but, at a later stage, the qualifying category was narrowed to those born in the UK or whose parents or grandparents had been born there. The challenge to the scheme made by ABCIFER was based upon (i) breach of legitimate expectations arising out of the terms of the announcement; (ii) irrationality; (iii) breach of Article 14 of the European Convention on Human Rights and of Article 1 of the First Protocol to the Convention; (iv) breach of the common law principle of equality.
46. The challenge based upon the "legitimate expectation" essentially failed on its facts. There was no relevant clear and unequivocal representation that the Claimant's members would all be included. There was no detrimental reliance. The challenge based on "irrationality" failed because the learned judge was unable to conclude that the imposition of a requirement of a link to the United Kingdom on the part of the civilian claimants was irrational. He pointed to the wide category of persons who were "British subjects" in the 1940s but who were now nationals of independent states. He held that it was reasonable for the Government to take the view that the scheme should be limited to persons with some close connection with the United Kingdom and, following that, to determine the criteria for qualification.
47. The argument based upon breach of the Human Rights convention failed because Scott Baker J, was of the clear view that ex gratia payments, unenforceable by action under domestic law, fell outside the scope of Article 1 of the First Protocol. In the light of that decision, Mr Blake QC for the present claimants did not argue the similar point raised on the papers in this case, reserving the point for the event that this matter proceeds to a higher court. The claim based on "inequality" failed because the learned judge considered that it failed for the same reason as that based upon irrationality.
48. The Claimants focus upon the treatment of those who had served in the Indian Army, but for whom the UK Government accepted responsibility in the 1950s and for whom compensation is provided under the new scheme. They submit that the distinction between those persons and the Claimants was and is essentially racial.
49. Mr Sales for the Defendant submits that there are significant differences between the two groups (apart from race). He submits that the British service personnel engaged in the Indian Army were subject to British military law: the distinction between former members of the Indian Army, according to whether they served pursuant to British or Indian Army law is a true constitutional distinction reflecting the division of responsibility drawn between the UK Government and the Government of India in respect of service personnel. As the Claimants' evidence indicates this is a distinction lost upon those to whom it principally matters, i.e. persons such as the Claimants themselves.
50. As indicated above, the Government's primary objective was to afford compensation to UK citizens and to those for whom the UK Government had accepted responsibility in dealing with compensation paid under the 1951 Treaty. That excluded the Gurkhas. The Government also feared that inclusion of the Gurkhas would mean that no valid distinction could be drawn between them and any other former POWs who had been serving in armed forces raised "throughout the British Empire": see McKane paragraph 6.9 p.176. It can be seen from paragraph 6.12 (p.177) that the Defendant referred to the "British Empire" for these purposes as including the Dominions. This is also clear from the letter of 4 September and 8 October 2002 passing between the parties' solicitors: pp. 159-160, when the Claimants' solicitors sought explanation of the Government's answers that to extend the criteria in the manner contended (or would) cost "hundreds of millions of pounds"; the reply makes clear that it was the Dominions that were in mind.
51. The problems for the Defendant, is it seems to me, are first, whether the 1951 criteria were rational criteria in 2000 and, secondly, the rationality of the conclusion that to include the Gurkhas inevitably brought into question the position of citizens of former Dominions also.
52. It was understandable in 1951, and hence in 2000, that the UK Government saw no need to provide for citizens of those States which, in their own right, had concluded Treaty arrangements with Japan. That included three out of the four Dominions and Pakistan, who were parties to the 1951 Treaty, and India, which had concluded a separate Treaty. India was not a signatory to the 1951 Treaty with Japan and

"It was indeed for this reason alone that non-European members of the former Indian Army who are now Nationals of the republic of India were ruled out as ineligible for benefit".

(see again the letter of 1 January 1955 at pp. 223-5 of the bundle, already quoted in full).

53. The decision was then made to exclude the Gurkhas because,

"There is no analogy between the status of European members of the Indian Army. The "native" personnel of the Indian Army were recruited from Ahirs, Dogras, Garhwalis, Gurkhas, etc and the fact that the Gurkhas, coming from the independent Kingdom of Nepal, were recruited under special Treaty arrangements made no difference whatever to their status when mustered in the Indian Army. They were paid like any other sepoy, and were subject to the same code of discipline (the Indian Army Act)…"(Ibid.)

Why were they "treated like any other sepoy"? The answer is surely because they (like other "sepoys") were not European. The allocation to the Indian code of discipline was based upon race, as I have endeavoured to explain above. No amount of semantic analysis of the ancient Acts can hide that fact.

54. Citizens of India and Pakistan who were members of the (British) Indian Army were reasonably excluded from UK compensation arrangements of the 1950s because their new independent nations had made their own arrangements with Japan. Citizens of the Dominions had gone to war under the auspices of independent governments that (with one exception) made similar arrangements with the former enemy. The Gurkhas were excluded on the basis of a Constitutional distinction which was in fact founded upon race.
55. The embarrassment to government in that exclusion is palpable in the 1955 correspondence. The adherence to the same distinction in 2000, particularly if the racial nature of the disciplinary distinction originally made in the 19^th century was not appreciated (as seems clear it was not), appears to me (with genuine respect for the aims of the scheme) to be irrational and inconsistent with the principle of equality that is the cornerstone of our law. The "floodgates" argument, based upon the perceived parallels with Dominion citizens, is difficult to follow in the light of the facts before the court.
56. In these circumstances there seems to me to be little reason for fossilising rationality in its 1951 form and applying it rigidly 50 years later. The decision making process has been helpfully laid bare before the Court. The failure to appreciate what to me is a clear distinction drawn on "de facto" racial grounds (disguised by "de jure" Constitutional ones) and to apply that same distinction to the new scheme undermines the rationality of the exclusion of the Claimants. This conclusion is compounded by the new analogy between these Claimants and Dominion citizens, drawn for the first time by the Defendant in reaching its decision in 2000. This case is distinguishable from ABCIFER. That case turned principally upon the question of legitimate expectation. The distinction drawn upon racial grounds was not present. For those reasons, it seems to me that the Defendant must be required to think again.

(H) European Convention on Human Rights

57. In the circumstances, it is not necessary to consider the grounds of challenge, advanced on the Claimants' behalf, under the Convention. I would merely say that, at the end of the distinguished arguments on both sides, I had great difficulty in seeing how eligibility or otherwise under this scheme fell within the ambit of Article 8. However, as already indicated, this claim succeeds for other reasons and I will hear Counsel upon the appropriate form of Order.