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URL: http://www.bailii.org/scot/cases/ScotCS/2019/2019_CSIH_43.html
Cite as: 2020 SCLR 258, 2019 GWD 24-375, 2019 SLT 915, [2019] ScotCS CSIH_43, [2019] CSIH 43, 2020 SC 95

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FIRST DIVISION, INNER HOUSE, COURT OF SESSION

Lord President

Lord Drummond Young

Lord Malcolm

OPINION OF

[2019] CSIH 43

P249/17

LORD CARLOWAY, the LORD PRESIDENT

in the Reclaiming Motion by

ANELA ANWAR

Petitioner and Reclaimer

against

THE ADVOCATE GENERAL

(representing the Secretary of State for Business, Energy and Industrial Strategy)

Respondent

and

THE COMMISSION FOR EQUALITY AND HUMAN RIGHTS

Interveners

Petitioner and Reclaimer: O’Neill QC, Blair; Drummond Miller LLP (for McClure Collins,

Glasgow)

Respondent: Crawford QC, Komorowski; Office of the Advocate General

Interveners: C O’Neill (sol adv); Solicitor to the Commission

2 August 2019

Introduction

[1] This reclaiming motion raises four questions. First, is there a power in either the

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Court of Session or, more important, the Sheriff Court to grant a warrant for inhibition and

arrestment on the dependence of an application to an Employment Tribunal for damages

resulting from discrimination and harassment? Secondly, if there is, is the procedure

involved “excessively difficult” such that it does not provide the applicant with an effective

remedy as required by EU law? Thirdly, is the correct comparator for EU purposes those

who make similar claims in the court system for damages arising out of the provision of

services or those making other claims before an Employment Tribunal? Fourthly, is this a

case in which the petitioner’s identity should be anonymised in the opinion issued by the

court?

1. The availability of an inhibition and arrestment on the dependence of a Tribunal

application

[2] In the 45 years between the enactment of the Industrial Relations Act 1971, which

created the Industrial (now Employment) Tribunals, and the submissions made by the

respondent to the Lord Ordinary, it has not been considered competent to apply to a court

for a warrant for diligence on the dependence of an application to a tribunal. That, of

course, is not determinative of the issue. It may indicate a lack of imagination within the

legal profession. The more likely reason, however, is that it has long been correctly

recognised by generations of skilled lawyers not to be competent, except in cases in which

the court has a concurrent jurisdiction in the claim made to the tribunal. It is of note that the

wording of the relevant warrant is one on the dependence of an action.

[3] In relation to inhibitions, historically these were of two types. The first was

inhibition “in security”. This involved obtaining letters of inhibition based upon the

existence of “a document of debt” in circumstances in which the debtor was vergens ad

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inopiam or in meditatione fugae. A liquid document of debt was essential (Stewart:

Diligence 537). This form of inhibition is not relevant in this case.

[4] The second type was inhibition “on the dependence” of an action (ibid 527, 530). This

required a summons in which a warrant was craved by the words “This summons is

warrant for inhibition”. Once the summons passed the signet, the warrant was validated

(ibid 537; originally Court of Session Act 1868, s 18). Only a Court of Session summons could

contain a warrant of this nature. The inhibition process was exclusively a Court of Session

one, albeit that letters could be obtained by presenting a Bill accompanied by a sheriff court

initial writ (Stewart: Diligence 537).

[5] Arrestment on the dependence originally required separate letters of arrestment

founding on the summons. In time the signet became the warrant (Debtors Act 1838, ss 17

and 18; Stewart: Diligence 17). In the sheriff court, a warrant for arrestment could be issued

along with that for citation on presentation of the initial writ (Sheriff Court Act 1876, s 6;

Stewart: Diligence 18). In either court, there had to be a summons or a writ with a monetary

conclusion (1838 Act, s 16).

[6] There is no authority for the proposition that warrants for inhibition and/or

arrestment on the dependence can be granted on the strength of any process, other than one

in dependence before a court. The sheriff had no power to warrant inhibition. Where an

action, in respect of the relevant subject matter can, and has been, raised in the Court of

Session or the Sheriff Court, there is no difficulty with those courts granting a competent

warrant. Thus, even if arbitration proceedings are ongoing, a concurrent action will be

competent, albeit that it may require to be sisted pending the outcome of arbitration

proceedings (Motordrift v Trachem Co 1982 SLT 127, Lord Ross at 128 citing Hamlyn & Co v

Talisker Distillery (1894) 21 R (HL) 21, Lord Watson at 25). Equally, provided that there is

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jurisdiction in Scotland, an action which mirrors one in another jurisdiction may be raised

and warrants granted, although the action might then be sisted (Hawkins v Wedderburn

(1842) 4D 924, Lord Mackenzie and others at 939-940; Fordyce v Bridges (1842) 4D 1334, LJC

(Hope) at 1340).

[7] The law relating to diligence on the dependence was codified in part 1A of the Debtors

(Scotland) Act 1987, which was inserted by the Bankruptcy and Diligence etc. (Scotland) Act

2007, following Karl Construction v Palisade Properties 2002 SC 270. Section 15A of the 1987 Act

is as follows:

“(1) ... the Court of Session or the sheriff may grant warrant for diligence by –

(a) arrestment; or

(b) inhibition,

on the dependence of an action.

(2) Warrant for –

(a) arrestment on the dependence of an action is competent only where

the action contains a conclusion for payment of a sum ...

(b) inhibition on the dependence is competent only where the action

contains –

(i) such a conclusion ...”.

The word “action” is defined as including a summary cause or application and a simple

procedure case (s 15A(3)). There is provision to allow diligence on the dependence of a

petition in the Court of Session where the prayer includes payment of a sum (s 15B).

“Court” is defined as the court before which the action is depending (s 15C). All of this

reflects the common law that diligence on the dependence can be granted by a court only in

respect of an action before that court which claims payment. It follows that it cannot be

granted on the basis of the existence of an application which is pending before a different

court or any tribunal which is not a court. It is only available if the action is competently

before the court. Were matters otherwise, there would be the potential for a conflict of

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decision on, for example, whether a prima facie case in a given ET claim existed (cf 1987 Act,

s 15F(3)(a) and Employment Tribunals (Constitution and Rules of Procedure) Regulations

2013 (SI 1237) Sch 1 rule 37(1)(a) (striking out)).

[8] Section 113 of the Equality Act 2010 provides that proceedings relating to a

contravention of the Act must be brought in accordance with Part 9. This gives jurisdiction

over some matters to the sheriff. In matters concerning discrimination or harassment in the

context of “work” (Part 5), jurisdiction is given only to an Employment Tribunal. The

petitioner’s claims related to such matters. Neither the Court of Session nor the sheriff had

jurisdiction to entertain such claims. An action raised in either court would be

fundamentally incompetent. There is thus no power to grant a warrant for diligence on the

dependence of such an Employment Tribunal matter. The Lord Ordinary was in error in

determining otherwise. In so saying, if a respondent in a tribunal claim were to be vergens ad

inopiam or in meditatione fugae, the courts could entertain an application to interdict the

respondent from disposing of certain assets (cf in England Amicus v Dynamex Friction

[2005] IRLR 724), but that is another matter.

2. Is the procedure involved “excessively difficult” such that it does not provide a

claimant to a tribunal with an “effective remedy”?

[9] In R (UNISON) v Lord Chancellor [2017] ICR 1037, Lord Reed said:

“106 EU law has long recognised the principle of effectiveness: that is to say, that

the procedural requirements for domestic actions must not be ‘liable to render

practically impossible or excessively difficult’ the exercise of rights conferred by EU

law: see, for example Case C-268/06 Impact v Minister for Agriculture and Food

[2009] All ER (EC) 306, para 46.”

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Lord Reed acknowledged the principle that a person whose rights require protection must

have an effective remedy before a tribunal (ibid paras 106-107, citing the Charter of

Fundamental Rights of the European Union, Art 47). Although this case is focused on EU

law, domestic law enshrines the same idea in its requirement of access to justice. That

common law principle would be breached if, despite a court or tribunal ruling, the system

was such that securing a remedy would be “practically impossible or excessively difficult”.

In short, there is no need to invoke EU law in this area. The remedies available in the courts

and tribunal systems must be effective.

[10] It is understandable that first tier tribunals do not generally have power to grant

protective orders, such as diligence on the dependence. Many involve claims against the

government or non-pecuniary applications. In the early days of the Industrial Tribunals, the

cap on awards was such as would render most arrestments or inhibitions nimious. The

limits were at such a level as would make it unlikely that an employer of even mild

substance would be inclined to dissipate his assets with a view to avoiding payment.

However, matters have moved on. Claims under the Equality Act 2010 can result, as they

have in the petitioner’s case, in substantial awards (here £75,000). In such a situation, the

temptation of small businesses or individual employers to conceal or transfer assets is much

greater. What has, in effect, happened, with the development of the Employment Tribunals

in place of the ordinary courts as the forum for what are claims based on the employment

contract, is that the imbalance between the economic powers of the employer and employee

(infra) have been widened by the removal of the employees former ability to seek an

effective form of diligence on the dependence from the courts.

[11] The figures in relation to the recovery of Employment Tribunal awards are

concerning. The Department for Business, Innovation & Skills 2013 Study “Payment of

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Tribunal Awards” sets out (chapter 6) the method of post award enforcement. In Scotland

this involves obtaining a certificate of the award from the tribunal which can then be

enforced, much like a court decree, by engaging sheriff officers. This method was used in

Scotland by only 26% of those who had not been paid (ibid p 39). Whereas the overall use of

enforcement increased the payment rate from 53% to 65% in England and Wales, the

comparative figures for Scotland (ibid p 42) were 48% to 54%. Some 47% of those using

sheriff officers obtained some payment. The reasons for non-payment were most commonly

that the employing company no longer exists or the employer just refuses to pay.

[12] No comparative figures for court actions were produced. There will inevitably be

cases in both the courts and the tribunal systems, where recovery proves impossible for

reasons unconnected with any nefarious action on the part of the employer. Nevertheless,

the information in the 2013 Study points to the need for the existence of such protective

measures as are available in a court process when the circumstances merit their use. These

would be where the claimant has a prima facie case and there is a real and substantial risk

that enforcement would be defeated or prejudiced by reason of the insolvency of the

employer (where a respondent is verging on insolvency) or where there is a likelihood of the

employer removing, disposing of, burdening, concealing or otherwise dealing with all or

some of his assets (see eg the 1987 Act, s 15E). There are reasons which would militate

against tribunals having this power; notably the prospect of increasing tension between the

parties in a system which was intended as an informal mechanism to resolve disputes “In

Place of Strife” (1969; Cmnd 3888). However, once all considerations are taken into account,

there appears to be no insurmountable obstacle either preventing the ET from having the

power to grant warrants for diligence on the dependence or alternatively transferring

potentially high value cases to the sheriff court.

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[13] The question posed in this section is easily answered if it is accepted that there is no

mechanism for securing effective protective measures either in the ET or the court pending

the resolution of the claim. In a significant number of cases, the procedure simply does not

exist to provide a claimant with an effective remedy; that is one that will secure the requisite

damages. However, even if it were possible to seek such measures in the sheriff court, and

this could, as noted above, be done by seeking an interdict prohibiting the defender from

disposing or attempting to dispose of his assets, such a system is by its nature “excessively

difficult” for many ET claimants.

[14] On the assumption that any claimant would, under the current regime, require to

raise a court action in order to obtain the appropriate protection, whether by way of interim

interdict or a warrant for diligence, a number of factors are in play. As was recognised in R

(UNISON) v Lord Chancellor (supra, Lord Reed):

“6. Relationships between employers and employees are generally characterised

by an imbalance of economic power. ...

...

8. ETs are intended to provide a forum for the enforcement of employment

rights by employees and workers, including the low paid, those who have recently

lost their jobs, and those who are vulnerable to long term unemployment. ...”.

A typical claimant in an ET claim will not normally have the services of a law agent. Legal

aid for ET cases is very limited. He or she may be a party litigant or be represented by a

non-lawyer. If the claimant requires to apply to a court for protection, he or she will need to

move from the relative informality, and (now) relatively fee free atmosphere, of an ET to the

contrasting formality of the court. He or she will almost certainly require to instruct a law

agent to advise on protective measures, to draft the appropriate initial writ and to frame and

appear at the motion for a warrant or other measure. Court fees of in excess of £175 will be

due. Once in the court system, there is a potential for the claimant to be liable not only for

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his or her own legal expenses, but also those of the employer should the motion be opposed

and lost, at first instance or on appeal, or in the event of a successful motion for recall. All of

this moves the level of cost, accessibility and convenience into another dimension in

comparison with what could be just a form filling exercise before the ET. For that reason the

exercise in securing an effective remedy is practically impossible or excessively difficult for a

large number of claimants.

3. Is the correct comparator for EU purposes those who make similar claims in the

court system for damages arising from the provision of services or those making other

claims before an Employment Tribunal?

[15] For reasons given by Lord Drummond Young, the correct comparator is with other

claims before an ET.

4. Is this a case in which the petitioner’s identity should be anonymised in the

opinion issued by the court?

[16] MH v Mental Health Tribunal for Scotland 2019 SLT 411 emphasised the importance of

the principle of open justice in facilitating public confidence in the civil justice system.

Unless the circumstances are life threatening or might result in the party being subjected to

inhuman or degrading treatment, it is for the court to balance the competing rights of

respect for privacy and open justice/transparency. The presumption is for open justice. It is

not enough for anonymization to be convenient or even desirable. It must be “a matter of

necessity in order to avoid the subordination of the ends of justice to the means” (ibid, LP

(Carloway) at para [27] citing A v Secretary of State for the Home Department 2014 SC (UKSC)

151, Lord Reed at para 30).

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[17] The petitioner’s argument in favour of anonymity states that there is no clear public

interest in the findings of the ET and the underlying evidential material being linked to the

petitioner as a named individual. The petitioner is concerned that she may be the subject of

further harassment by the respondents in the ET process, their agents or certain elements in

the Muslim community, should she be named as petitioner. Such conduct may affect her

mental health. An affidavit from the petitioner explaining her position was produced and

past incidents referred to.

[18] The nature and outcome of the ET proceedings are already known to the respondents

in the ET process and, no doubt, those connected to them. The present petition and the

opinion are concerned with matters of law. There is no information relative to any

harassment or discriminatory action taken against the petitioner. There is no basis for

granting anonymity or a contempt of court order in these circumstances. The interlocutor of

the Lord Ordinary dated 29 March 2017 should accordingly be recalled, in that regard.

Conclusion

[19] The reclaiming motion should be allowed and the Lord Ordinary’s interlocutor of

1 June 2018 recalled. Thereafter, the petitioner’s first and second pleas-in-law ought to be

repelled and her third and fourth pleas sustained. The respondent’s third and fourth pleas

ought to be repelled. The matter should be remitted to the Lord Ordinary to deal with the

petitioner’s fifth and sixth pleas and the respondent’s fifth to seventh pleas.

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FIRST DIVISION, INNER HOUSE, COURT OF SESSION

Lord President

Lord Drummond Young

Lord Malcolm

OPINION OF LORD DRUMMOND YOUNG

[2019] CSIH 43

P249/17

in the Reclaiming Motion by

ANELA ANWAR

Petitioner and Reclaimer

against

THE ADVOCATE GENERAL

(representing the Secretary of State for Business, Energy and Industrial Strategy)

Respondent

and

THE COMMISSION FOR EQUALITY AND HUMAN RIGHTS

Interveners

Petitioner and Reclaimer: O’Neill QC, Blair; Drummond Miller LLP (for McClure Collins,

Glasgow)

Respondent: Crawford QC, Komorowski; Office of the Advocate General

Interveners: C O’Neill (sol adv); Solicitor to the Commission

2 August 2019

Introduction

[20] In proceedings before the employment tribunal in Glasgow the petitioner obtained a

substantial award in her favour against her former employer and her former line manager.

She has been unable so far to implement that award. She alleges that while the proceedings

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in the employment tribunal were taking place the respondents in those proceedings had

adequate funds to meet such an award, but that those funds are no longer available and that

in consequence she is unlikely to be able to enforce her award to more than a minimal

extent. The award was based on Community law, in particular on the breach of EU

directives governing sexual, racial and religious discrimination at work. Under principles of

EU law, member states are obliged to provide effective remedies for the implementation of

Community-based rights (the principle of effectiveness), and in doing so must provide

remedies that are equivalent to those available for comparable claims that do not involve

Community law (the principle of equivalence). The petitioner has raised proceedings for

judicial review against the respondent, the Secretary of State for Business, Energy and

Industrial Strategy, on the ground that Scots law does not provide an effective remedy to

secure the implementation of an award made by an employment tribunal under provisions

of EU law. In failing to provide such a remedy, it is alleged that the respondent has failed to

give effect to the principles of effectiveness and equivalence, and is thus in breach of EU law.

[21] Specifically, the petitioner claims that in order to provide an effective remedy a legal

system must make available provisional and protective measures as litigation proceeds, in

order to provide interim security against the possible insolvency of the defender or

respondent. In Scots law the standard provisional and protective measures take the form of

diligence on the dependence of an action, by way of inhibition and arrestment. The

petitioner advances two main arguments relating to the availability of diligence on the

dependence in employment tribunal proceedings. First, it is said that diligence on the

dependence is not available in respect of employment tribunal proceedings, and that there is

accordingly no effective remedy. Secondly, it is said that even if diligence on the dependence

is available in respect of such proceedings, it is not available through an application to the

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tribunal itself, but instead requires separate proceedings to be raised in, normally, the sheriff

court, in order that diligence can be done on the dependence of those proceedings. The need

to raise two sets of proceedings, it is said, is an obstacle to the effective enforcement of

tribunal awards, and is thus a breach of the EU law principle of effectiveness. A third

argument is presented based on the EU law principle of equivalence. This is essentially that

in proceedings for discrimination on the grounds of sex, race or religion that are governed

by domestic rather than EU law (for example claims relating to discrimination in the supply

of goods or services), the proceedings are raised in a court and diligence on the dependence

is available in the ordinary way. On that basis, it is said, there is a breach of the equivalence

principle as a result of the different remedies available in claims based on EU law and those

based on domestic law.

[22] The petition for judicial review came before the Lord Ordinary, who held that there

had been no contravention of either the principle of effectiveness or the principle of

equivalence. He accordingly refused the prayer of the petition. The petitioner has now

reclaimed against that decision. Before considering the issues involved, I will set out the

factual background to the petitioner’s claim and summarize the Lord Ordinary’s decision. I

will then consider the merits of the arguments presented, first in relation to the availability

of diligence on the dependence in respect of employment tribunal proceedings, which is a

matter of domestic Scots law, secondly in relation to the principle of effectiveness in EU law,

and thirdly in relation to the principle of equivalence in EU law. In each case I will set out

the relevant legislation, both in the United Kingdom in relation to the availability of

diligence in Scots law and in the form of European Directives and other instruments in

relation to the EU law claims based on the principles of effectiveness and equivalence.

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Background

[23] The petitioner raised proceedings in the employment tribunal in Glasgow against her

former employer and her former line manager in which she alleged harassment on the

grounds of her sex, race and religion. In August 2016 the tribunal made a series of findings

in the petitioner’s favour and subsequently ordered the respondents in the tribunal

proceedings, namely her former employer and line manager, to make payment to her of a

sum of approximately £75,000 plus interest and expenses in respect of loss and damage that

she had suffered. That included psychological damage. The respondents in the tribunal

proceedings were found liable to make payment on a joint and several basis.

[24] Following the issue of the judgment, but before any payment had been received, the

petitioner's legal adviser obtained information to the effect that those in charge of the

petitioner’s former employer intended to close down the existing business and transfer its

funds to another entity, so as to avoid having to make payment to the petitioner. The

petitioner sought and was granted an interim interdict at Glasgow Sheriff Court to prevent

the dissipation of funds, but by October 2016 the sum at credit of the employer's bank

account had fallen to approximately £4,000. The petitioner has not, to date, received any

payment in respect of her tribunal award from either her former employer or her former line

manager.

[25] Before the Lord Ordinary, the petitioner argued that this situation would have been

avoided if she had been able to effect arrestment on the dependence against her former

employer at the time of raising her claim in the employment tribunal. She argued that the

absence of any power on the part of an employment tribunal judge to grant such an

application constituted a breach of the EU law principles of effectiveness and equivalence.

She maintained that the respondent ought to have implemented those principles by

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ensuring that a litigant before an employment tribunal in Scotland would have a right to

arrest on the dependence of the tribunal claim, and she sought inter alia an award of

compensation for the respondent’s apparent failure to implement EU law. The Commission

for Equality and Human Rights was represented as an intervening party.

[26] The petitioner now reclaims against the decision of the Lord Ordinary on four

grounds. It is said that he: (i) erred in finding that it is possible to arrest on the dependence

of a claim before the employment tribunal; (ii) esto such an application is possible, erred in

finding that such a procedure provided an effective remedy to the petitioner; (iii) erred in

his choice of comparator for the purpose of the application of the EU law principle of equal

treatment or equivalence; and (iv) misdirected himself in law on the approach to be taken by

the court in assessing a direct challenge to the proper implementation in national law of

provisions of EU directives.

The Lord Ordinary’s reasoning

[27] In relation to the principle of effectiveness, the Lord Ordinary accepted that the

principle would be breached if there were no mechanism, such as diligence on the

dependence, to protect an employment tribunal claimant’s right to compensation from the

risk of a respondent’s failure to meet an award. In so holding he relied on the decision of the

European Court of Justice in R v Secretary of Transport, ex parte Factortame (No 2), [1991] 1 AC

603. The critical question for the Court was whether such a mechanism existed in Scots law

whereby the claimant in the employment tribunal could obtain interim security for a

possible financial award through the use of diligence on the dependence pending the

outcome of the claim. If that were possible, the Court then had to determine whether that

mechanism was such as to render the exercise of those rights “practically impossible or

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excessively difficult”; that test was derived from the Court of Justice in Impact v Minister for

Agriculture and Food, [2008] 2 CMLR 47, at paragraph 46.

[28] The Lord Ordinary noted that it had been held competent to raise an action in the

Court of Session for the sole purpose of obtaining diligence on the dependence pending the

outcome of proceedings in a foreign court; such an action was not to be dismissed on the

ground of lis alibi pendens, and it was immaterial that the Scottish court had no jurisdiction to

determine the merits of the action. In so holding he relied on the decisions of the Court of

Session in Hawkins v Wedderburn, 1842, 4 D 924, and Fordyce v Bridges, 1842, 4 D 1334.

Neither of those cases had been the subject of subsequent detailed judicial comment, and the

Lord Ordinary give consideration to two further cases in Scotland, Atkinson & Wood v

Mackintosh, 1905, 7 F 598, and Motordrift A/S v Trachem Co Ltd, 1982 SLT 127, and to the

English case of Amicus v Dynamex Friction Ltd, (2005) IRLR 724. Although the present case

was not on all fours with any of those authorities, in Fordyce and Motordrift it was envisaged

that Scottish court proceedings might be used in the future as a means of ensuring

enforcement of an order of another forum even where the Scottish courts had no jurisdiction

in respect of the merits of the action giving rise to the order.

[29] The Lord Ordinary accepted that proceedings in an employment tribunal were

different, in that by virtue of section 15 of the Employment Tribunals Act 1996 an order of

the tribunal is enforceable as if it were an extract registered decree arbitral bearing a warrant

for execution issued by a sheriff. Nevertheless he did not consider that that rendered an

action raised purely to obtain diligence on the dependence incompetent. He could find no

rule of law to that effect. Section 15A of the Debtors (Scotland) Act 1987 was in general

terms, and section 15C of that Act specifically provides that it is competent to grant diligence

on the dependence of a contingent debt. There was no requirement that the contingency be

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resolvable in the action in which the warrant is granted. A plea of lis alibi pendens would not

be available in such circumstances, by reference to Hawkins and Fordyce.

[30] The Lord Ordinary further considered that, even if a rule did exist in Scotland which

precluded diligence on the dependence from being sought in relation to claims in the

employment tribunal, then, under reference to Factortame, the principle of effectiveness

would require that rule to be set aside. He saw no reason to distinguish between the powers

of the sheriff court and the Court of Session in this respect. The Debtors (Scotland) Act 1987

made no such distinction. The intervener, the Commission for Equality and Human Rights,

had submitted that they were unaware of such an application ever having been made by an

employment tribunal claimant. The Lord Ordinary considered, however, that a number of

potential reasons might exist for that, and it was impossible to draw any conclusion from the

absence of prior cases.

[31] On the question of whether the need to raise protective proceedings in a separate

action rendered the exercise of the petitioner’s EU law rights practically impossible or

excessively difficult, the Lord Ordinary found that it did not. He placed reliance on the

decision in Impact v Minister for Agriculture and Food (supra), in holding that the question was

not whether there was an adequate policy justification for requiring protective proceedings

in the sheriff court. That requirement did not constitute a limitation on the exercise of a

community law right in the sense discussed in R (UNISON) v Lord Chancellor [2017] 3 WLR

409. There was no obligation on states to provide an ideal solution. The additional expense

and inconvenience of having to raise a separate action in the sheriff court was likely to be

modest and the cost of the application itself was likely to be the same regardless of the

forum. The standard of practical impossibility was a high one.

Page 18 ⇓

[32] In relation to the argument that there had been a breach of the EU law principle of

equivalence, the Lord Ordinary again found that there had been no such breach. Having

determined that an application to the sheriff court for interim diligence was open to the

petitioner, then it made no difference what domestic action her claim was compared with, as

interim protection was available one way or another in all cases. In any event, the Lord

Ordinary considered that the appropriate comparator would have been with employment

law rights not derived from community law. It was appropriate to focus on the employment

law context standing that it was central to the purpose of the relevant Directives in securing

equal treatment. There was no difference between a community law based claim for

discrimination and a domestic law based claim for unfair dismissal. There was, accordingly,

no breach of the principle of equivalence.

[33] Finally the Lord Ordinary dealt with two subsidiary issues. Arguments had been

presented related to the European Convention on Human Rights. On these, he found that

the case law of the European Court of Human Rights took matters no further than the

community law principles. The intervener had presented an argument based on Article 21

of the European Charter of Fundamental Rights, and this was also ill-founded. There was

no reason why a member state should not adopt different regimes for different types of

interaction where discrimination might take place, provided that the principle of non-

discrimination was promoted in each regime.

The availability of diligence in Scots law

[34] The first ground of appeal for the petitioner and reclaimer is that the Lord Ordinary

was in error in finding that it was possible for a claimant before an employment tribunal to

arrest on the dependence of those proceedings. The Lord Ordinary’s decision on this matter

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was based on case law, in the form of the decisions in Hawkins v Wedderburn, supra, Fordyce v

Bridges, supra, and Motordrift A/S v Trachem Co Ltd, supra. It was submitted for the petitioner

that the jurisdiction and power of the courts to grant diligence on the dependence was now

wholly circumscribed by statute, in the form of sections 15A-15N of the Debtors (Scotland)

Act 1987, as amended by the Bankruptcy and Diligence etc (Scotland) Act 2007.

Consequently the older case law had been superseded by what amounted to a legislative

code. Under that code, it was submitted, there was no provision for raising an action in the

Court of Session or sheriff court in order to do diligence in support of a claim made in

another court or tribunal. It was further submitted that section 113 of the Equality Act 2010

provides that proceedings for a contravention of that Act must be brought in accordance

with Part 9 of the Act, and section 120 of the same Act provides that a tribunal has

jurisdiction to determine complaints relating to any contravention of Part 5 of the Act,

dealing with work-based discrimination. On that basis, it was said, the jurisdiction of the

courts to entertain an action for payment for the purpose of granting diligence on the

dependence in support of an employment tribunal claim for work-based discrimination was

excluded.

[35] I will consider each of these arguments in turn. First, however, it is necessary to set

out the established law relating to the availability of diligence on the dependence in respect

of proceedings that are not before the court granting diligence but before another court or

tribunal.

The law prior to 2007

[36] Diligence, in the form of inhibition or arrestment, has been available on the

dependence of an action containing a conclusion for payment in both the Court of Session

Page 20 ⇓

and sheriff court for many years, and the procedure has been used with great frequency. It is

also competent, however, to raise proceedings in the Court of Session and, it would appear,

the sheriff court for the purpose of obtaining diligence by way of interim security in respect

of a claim that is pursued elsewhere. The earliest recorded case where this was done appears

to be Hawkins v Wedderburn, supra. In that case a suit had been brought in Chancery in

England for payment of a debt allegedly due by parties domiciled in England. Those parties

had estates in Scotland, and the plaintiff in the English proceedings raised an action in the

Court of Session against the same parties for payment of the same debt with a view to

obtaining diligence against the defenders. This course was held competent by a majority of

the whole Court. The effect of the decision was summed up by the Lord Justice-Clerk as

follows (at 4 D 944-945):

“I go distinctly on the principle, that I think a party is entitled to raise and keep up

an action for the very purpose of securing himself by ultimate payment, although he

may not be in a condition… to follow out the action at the time, but must wait the

decision of another tribunal.…[A]n action may be raised and will be sustained for the

purpose of security ...”.

[37] Hawkins was followed shortly afterwards by Fordyce v Bridges, supra another case

where an action in the Court of Session was used for the purpose of obtaining diligence

against heritable property in Scotland as security for proceedings in England; those

proceedings, once again in Chancery, related to the will of a person domiciled in England.

The Second Division followed Hawkins, and held diligence to be competent. The Lord

Justice-Clerk gave a rather fuller account of the underlying principle (at 4 D 1343):

“I do not think the competency of such an action as the present depends at all on the

enquiry, whether this Court has jurisdiction to try the question on the merits

between the parties. The principle which I stated in Wedderburn, on which I

apprehend that judgment rests, was this: – A party has a suit in England in which he

may obtain decree, and he finds that his debtor has property in Scotland which it

may be necessary for him to secure, in order to meet and satisfy the decree, if he

Page 21 ⇓

obtains it in England. He comes into this Court with a summons narrating the

English suit, averring, of course, that he will obtain decree. He sets forth that as his

interest and civil right to us who have jurisdiction over the property of his adversary,

and he raises his action here to secure property to make that decree effectual; and, on

obtaining that decree, asks for judgment and execution in terms of it”.

In my opinion three important points appear from this formulation of the principle. First,

the action may be raised in a Scottish court notwithstanding that it has no jurisdiction to

hear the merits of the dispute. Secondly, in such a case, the purpose of the Scottish action is

to obtain diligence on the dependence as a form of interim security as the other litigation

proceeds. Thirdly, the basis for the Scottish action is the existence of proceedings in another

court; the pursuer’s “interest and civil right” was in Fordyce the English suit together with an

averment that the pursuer would obtain decree. These features are in my opinion important,

because they make it clear that the primary purpose of the Scottish proceedings is to obtain

diligence as interim security, and that the merits of the dispute and jurisdiction to determine

those merits have no bearing on the competency of the Scottish proceedings.

[38] More recently, the competency of this procedure was upheld in relation to arbitral

proceedings in Motordrift A/S v Trachem Co Ltd, supra, the third of the cases founded on by

the Lord Ordinary. In that case Lord Ross in the Outer House held the proceedings

competent notwithstanding that the parties had agreed to arbitration of their dispute in

England and that the Scottish court could not at any time determine the merits of that

dispute. The principle recognized in that decision has been followed repeatedly: see, for

example, Svenska Petroleum AB v HOR Ltd, 1986 SLT 513; Mendok BV v Cumberland Maritime

Corp, 1989 SLT 192; and Rippin Group Ltd v ITP Interpipe SA, 1995 SCLR 352. Subject to the

limitations that are now contained in the Bankruptcy and Diligence (Scotland) Act 2007, it

remains standard practice in Scottish arbitrations for parallel proceedings to be raised in

court in order to obtain diligence on the dependence. Apart from the statutory provisions

Page 22 ⇓

governing claims before the employment tribunal, there can be little doubt in my opinion

that the same procedure could be followed in relation to those claims. Before I consider that

aspect of the case, however, I must deal with the legislation of 2007 governing the use of

diligence. The petitioner’s submission is that that legislation wholly circumscribes the

jurisdiction and power of the courts to grant diligence on the dependence. Consequently

diligence is no longer regulated by case law, and as a result, it is said, the courts lack

jurisdiction to consider any claims related to workplace-related disputes under the Equality

Act, even for the purpose of granting diligence.

The legislation governing diligence

Debtors (Scotland) Act 1987 as amended by the Bankruptcy and Diligence etc (Scotland) Act 2007

[39] The procedural aspects of diligence on the dependence of an action had been the

subject of criticism for many years prior to 2007, on the ground that it was too easy to obtain.

It was not necessary for a pursuer who sought diligence on the dependence to demonstrate

even a prima facie case on the merits of the action. Nor was it necessary for the pursuer to

demonstrate a need for diligence; warrant for diligence was granted automatically. The law

in this area was considered at length by the Scottish Law Commission in their Report on

Diligence on the Dependence and Admiralty Arrestments (Scots Law Com No. 164),

published in March 1998, and extensive proposals for reform were made. The criticisms

were summarized in Karl Construction Ltd v Palisade Properties PLC, 2002 SC 270, at

paragraphs [32]-[66]. It was also apparent that Scots law was significantly out of step with

other legal systems in its willingness to grant diligence automatically as a matter of right. It

was in response to the criticisms of the existing law that section 169 of the Bankruptcy and

Diligence etc (Scotland) Act 2007 was enacted. This added Part IA to the Debtors (Scotland)

Page 23 ⇓

Act 1987. I would emphasise, however, that this was designed specifically to deal with the

problems that had been identified by the Scottish Law Commission and in Karl Construction

and subsequent cases. It was concerned principally with what is required to obtain diligence

on the dependence. It does not deal with the consequences of the grant of diligence.

[40] The material provisions of Part 1A are as follows:

“15A Diligence on the dependence of action

(1) Subject to subsection (2) below and to sections 15C to 15F of this Act, the

Court of Session or the sheriff may grant warrant for diligence by-

(a) arrestment; or

(b) inhibition,

on the dependence of an action.

(2) Warrant for-

(a) arrestment on the dependence of an action is competent only where the

action contains a conclusion for payment of a sum other than by way of

expenses; and

(b) inhibition on the dependence is competent only where the action

contains-

(i) such a conclusion; or

(ii) a conclusion for specific implement of an obligation to convey

heritable property to the creditor or to grant in the creditor's favour a

real right in security, or some other right, over such property.

(3) In this Part of this Act, ‘action’ includes, in the sheriff court-

(a) a summary cause;

(b) a simple procedure case (within the meaning of section 72(9) of the

Courts Reform (Scotland) Act 2014); and

and references to “summons”, “conclusion” and to cognate expressions shall be

construed accordingly.

…

15C Diligence on the dependence to secure future or contingent debts

(1) It shall be competent for the court to grant warrant for diligence on the

dependence where the sum concluded for is a future or contingent debt.

(2) In this section and in sections 15D to 15M of this Act, the ‘court’ means the

court before which the action is depending.

Page 24 ⇓

15D Application for diligence on the dependence

(1) A creditor may, at any time during which an action is in dependence, apply

to the court for warrant for diligence by -

(a) arrestment; or

(b) inhibition,

on the dependence of the action.

(2) An application under subsection (1) above shall -

(a) be in (or as nearly as may be in) the form prescribed by Act of

Sederunt;

(b) subject to subsection (3) below, be intimated to and provide details

of—

(i) the debtor; and

(ii) any other person having an interest;

this Act, of warrant for diligence on the dependence in advance of a hearing

on the application under section 15F of this Act; and

(d) contain such other information as the Scottish Ministers may by

regulations prescribe.

(3) An application under subsection (1) above need not be intimated where the

creditor is seeking the grant, under section 15E(1) of this Act, of warrant in advance

of a hearing on the application under section 15F of this Act.

(4) The court, on receiving an application under subsection (1) above, shall—

(a) subject to section 15E of this Act, fix a date for a hearing on the

application under section 15F of this Act; and

(b) order the creditor to intimate that date to—

(i) the debtor; and

(ii) any other person appearing to the court to have an interest.

15E Grant of warrant without a hearing

(1) The court may, if satisfied as to the matters mentioned in subsection (2)

below, make an order granting warrant for diligence on the dependence without a

hearing on the application under section 15F of this Act.

(2) The matters referred to in subsection (1) above are -

(a) that the creditor has a prima facie case on the merits of the action;

(b) that there is a real and substantial risk enforcement of any decree in

the action in favour of the creditor would be defeated or prejudiced by reason

of -

(i) the debtor being insolvent or verging on insolvency; or

Page 25 ⇓

(ii) the likelihood of the debtor removing, disposing of,

burdening, concealing or otherwise dealing with all or some of the

debtor's assets,

were warrant for diligence on the dependence not granted in advance of such

a hearing; and

granting warrant may have on any person having an interest, to do so.

(3) The onus shall be on the creditor to satisfy the court that the order granting

warrant should be made.

(4) Where the court makes an order granting warrant for diligence on the

dependence without a hearing on the application under section 15F of this Act, the

court shall -

(a) fix a date for a hearing under section 15K of this Act; and

(b) order the creditor to intimate that date to -

(i) the debtor; and

(ii) any other person appearing to the court to have an interest.

(5) Where a hearing is fixed under subsection (4)(a) above, section 15K of this Act

shall apply as if an application had been made to the court for an order under that

section.

(6) Where the court refuses to make an order granting a warrant without a

hearing under section 15F of this Act and the creditor insists in the application, the

court shall -

(a) fix a date for such a hearing on the application; and

(b) order the creditor to intimate that date to -

(i) the debtor; and

(ii) any other person appearing to the court to have an interest.

15F Hearing on application

(1) At the hearing on an application for warrant for diligence on the dependence,

the court shall not make any order without first giving -

(a) any person to whom intimation of the date of the hearing was made;

and

(b) any other person the court is satisfied has an interest,

an opportunity to be heard.

(2) The court may, if satisfied as to the matters mentioned in subsection (3)

below, make an order granting warrant for diligence on the dependence.

(3) The matters referred to in subsection (2) above are -

(a) that the creditor has a prima facie case on the merits of the action;

Page 26 ⇓

(b) that there is a real and substantial risk enforcement of any decree in

the action in favour of the creditor would be defeated or prejudiced by reason

of -

(i) the debtor being insolvent or verging on insolvency; or

(ii) the likelihood of the debtor removing, disposing of,

burdening, concealing or otherwise dealing with all or some of the

debtor's assets,

were warrant for diligence on the dependence not granted; and

granting warrant may have on any person having an interest, to do so.

(4) The onus shall be on the creditor to satisfy the court that the order granting

warrant should be made.

(5) Where the court makes an order granting or, as the case may be, refusing

warrant for diligence on the dependence, the court shall order the creditor to

intimate that order to -

(a) the debtor; and

(b) any other person appearing to the court to have an interest.

(6) Where the court makes an order refusing warrant for diligence on the

dependence, the court may impose such conditions (if any) as it thinks fit.

(7) Without prejudice to the generality of subsection (6) above, those conditions

may require the debtor -

(a) to consign into court such sum; or

(b) to find caution or to give such other security,

as the court thinks fit”.

The effect of legislation on the availability of diligence

[41] In my opinion the legislation of 2007 has no bearing on the competency of the

procedure found in Hawkins v Wedderburn, Fordyce v Bridges and Motordrift AS v Trachem Co

Ltd: that is to say, the competency of raising proceedings in a Scottish court that are ancillary

to proceedings in another court or tribunal for the purpose of doing diligence and thus

obtaining interim security in respect of Scottish property. For the petitioner it was argued

that the provisions of sections 15A-15N of the Debtors (Scotland) Act 1987, as amended in

2007, amounted in effect to a legislative code that governed every aspect of diligence on the

Page 27 ⇓

dependence. That is manifestly not the case. At a very elementary level, those sections,

which I have quoted at length, do not define what the diligence is, or what arrestment is, or

what inhibition is. Nor do they define the precise effect that diligence has on property, nor

how it is treated in an insolvency. Those sections are concerned with aspects of court

procedure and the matters that the pursuer must establish in order to obtain diligence.

Substantial parts of the law remain unaffected, and are therefore still governed by the

common law.

[42] That applies in particular to the use of diligence in an action that is ancillary to

proceedings before another court or tribunal. An action used in this manner will invariably

contain a conclusion for payment, normally the sum claimed in the principal proceedings.

That satisfies an essential requirement at common law in any action that does not relate to

heritable property, and that requirement is repeated in section 15A(2). Sections 15D-15F

govern the grant of diligence. These sections impose requirements that innovate on the

common law and require, in summary, that the pursuer suing for payment must have a

prima facie case on the merits of the action, that there must be a substantial risk that

enforcement of a decree would be defeated or prejudiced by reason of insolvency or the

disposal or concealment of assets, and that it is reasonable in all the circumstances to grant

warrant for diligence. These are designed to address the problems with the European

Convention on Human Rights that were identified in Karl Construction. They govern the

requirements for the grant of diligence, but they do not affect the substance of the parties’

rights. For present purposes, what is important is that there is nothing in the provisions of

sections 15A-15N that interferes with the use of diligence in ancillary proceedings. As

already mentioned, diligence on the dependence is regularly used in ancillary proceedings,

and it would be remarkable if legislation aimed at imposing stricter controls on the

Page 28 ⇓

requirements for the grant of diligence had the effect of rendering such procedure

incompetent. It has never so far as I am aware been suggested that the use of diligence in

that manner could be incompatible with the European Convention on Human Rights, and I

find it quite impossible to see how any such argument could be constructed following the

reforms of 2007.

[43] The employment tribunal is a tribunal that functions outwith the court system, and is

subject to its own legislation. I will now discuss that legislation. Before doing so, however, I

observe that so far as the requirements at common law for obtaining diligence are concerned

there is no reason that the employment tribunal should be treated differently from any other

form of tribunal outside the main system of Scottish courts. In this respect they are in exactly

the same position, functionally, as an arbitrator or a court in another jurisdiction.

The effect of legislation governing employment law and the employment tribunal

Employment Tribunals Act 1996

[44] The petitioner’s claim was made in an employment tribunal, and certain provisions

of the legislation governing such tribunals are material for present purposes. Section 15 of

the Employment Tribunals Act 1996 deals with orders for payment made by such tribunals.

Subsection (2) of that section provides as follows:

“(2) Any order for the payment of any sum made by an employment tribunal in

Scotland (or any copy of such an order certified by the Secretary of the Tribunals)

may be enforced as if it were an extract registered decree arbitral bearing a warrant

for execution issued by the sheriff court of any sheriffdom in Scotland.”

Equality Act 2010

[45] The petitioner’s claim before the employment tribunal was based on the Equality Act

2010, and in particular provisions in that Act that have their origins in European Union

Page 29 ⇓

legislation. The provisions of the Act that are material for present purposes are found in

Part 9 (Enforcement), and are as follows:

“113 Proceedings

(1) Proceedings relating to a contravention of this Act must be brought in

accordance with this Part.

(2) Subsection (1) does not apply to proceedings under Part 1 of the Equality Act

2006.

(3) Subsection (1) does not prevent –

(a) a claim for judicial review;

(b) proceedings under the Immigration Acts;

1997;

(d) in Scotland, an application to the supervisory jurisdiction of the Court

of Session.

(4) This section is subject to any express provision of this Act conferring

jurisdiction on a court or tribunal.

(5) The reference to a contravention of this Act includes a reference to a breach of

an equality clause or rule.

(6) Chapters 2 and 3 do not apply to proceedings relating to an equality clause or

rule except in so far as Chapter 4 provides for that.

(7) This section does not apply to –

(a) proceedings for an offence under this Act; or

(b) proceedings relating to a penalty under Part 12 (disabled persons:

transport).

114 Jurisdiction

(1) The county court or, in Scotland, the sheriff has jurisdiction to determine a

claim relating to –

(a) a contravention of Part 3 (services and public functions);

(b) a contravention of Part 4 (premises);

(d) a contravention of Part 7 (associations);

(e) a contravention of section 108 , 111 or 112 that relates to Part 3, 4 , 6 or

(2) Subsection (1)(a) does not apply to a claim within section 115.

(3) Subsection (1)(c) does not apply to a claim within section 116.

Page 30 ⇓

(4) Subsection (1)(d) does not apply to a contravention of section 106.

…

120 Jurisdiction

(1) An employment tribunal has, subject to section 121, jurisdiction to determine

a complaint relating to—

(a) a contravention of Part 5 (work);

(b) a contravention of section 108 , 111 or 112 that relates to Part 5.

(2) An employment tribunal has jurisdiction to determine an application by a

responsible person (as defined by section 61) for a declaration as to the rights of that

person and a worker in relation to a dispute about the effect of a non-discrimination

rule.

(3) An employment tribunal also has jurisdiction to determine an application by

the trustees or managers of an occupational pension scheme for a declaration as to

their rights and those of a member in relation to a dispute about the effect of a non-

discrimination rule.

(4) An employment tribunal also has jurisdiction to determine a question that—

(a) relates to a non-discrimination rule, and

(b) is referred to the tribunal by virtue of section 122.

(5) In proceedings before an employment tribunal on a complaint relating to a

breach of a non-discrimination rule, the employer—

(a) is to be treated as a party, and

(b) is accordingly entitled to appear and be heard.

(6) Nothing in this section affects such jurisdiction as the High Court, the county

court , the Court of Session or the sheriff has in relation to a non-discrimination rule.

(7) Subsection (1)(a) does not apply to a contravention of section 53 in so far as

the act complained of may, by virtue of an enactment, be subject to an appeal or

proceedings in the nature of an appeal.

(8) In subsection (1), the references to Part 5 do not include a reference to

section 60(1).

The effect of employment legislation on the availability of diligence

[46] In my opinion the foregoing provisions make no difference to the existing law on the

availability of diligence in respect of employment tribunal proceedings. As under the earlier

law, I am of opinion that such diligence is competent through the use of an ancillary action

containing a conclusion for payment of the sum sought in the employment tribunal

Page 31 ⇓

proceedings. Provided that that is done, I consider that the law remains as laid down in

cases such as Fordyce v Bridges and Motordrift A/S v Trachem Co Ltd.

[47] The provisions primarily founded on by counsel for the petitioner are sections 113

and 120 of the Equality Act 2010. Part of the background is obviously that, under section 15

of the Employment Tribunals Act 1996 an order for payment of a sum that is made by an

employment tribunal may be enforced as if it were an extract registered decree arbitral

bearing a warrant for execution issued in the sheriff court. This demonstrates that

employment tribunals are treated for the purposes of enforcement as if they conducted a

form of arbitration. That is entirely consistent with the view that I have suggested, that no

distinction can be drawn between employment tribunals and ordinary arbitration

proceedings.

[48] Section 113 of the Equality Act 2010, however, provides that proceedings relating to a

contravention of the Act must be brought in accordance with the provisions of Part 9 of the

Act, subject to a number of exceptions, which include claims for judicial review and

applications to the supervisory jurisdiction of the Court of Session. Section 120 provides that

an employment tribunal has jurisdiction to determine a complaint relating to contraventions

of Part 5 of the Act, relating to work. It is that Part that is relevant to the petitioner’s claim in

the employment tribunal. Those two provisions have the effect that any claim brought under

Part 5 of the Act must be brought in an employment tribunal, and not before the ordinary

courts, subject to the exceptions for judicial review and the supervisory jurisdiction of the

Court.

[49] Nevertheless, this does not in my opinion have any bearing on proceedings brought

in the Court of Session or a sheriff court for the purpose of obtaining diligence on the

dependence. As already indicated (paragraph [37] above, founding on the formulation of

Page 32 ⇓

principle by the Lord Justice-Clerk in Fordyce v Bridges), the purpose of such proceedings in

a court is to obtain diligence as interim security, and not to resolve the substantive dispute

between the parties. Normally the court will have no jurisdiction to decide the substantive

dispute. That is plainly the case if that dispute is before a foreign court or an arbiter. In my

opinion no distinction can be drawn between those situations and the jurisdiction of the

employment tribunal to decide the merits of a dispute under Part 5 of the Equality Act 2010.

The fact that the jurisdiction of the Court of Session or sheriff court is excluded is irrelevant;

the proceedings in those courts are concerned with obtaining security and not with deciding

a claim under Part 5 of the Act. The basis for the action in court is the existence of

proceedings in another court or tribunal, and in this respect too I am of opinion that no

distinction can be drawn between the employment tribunal and an arbiter or a court in

another jurisdiction. For the foregoing reasons I would reject the petitioner’s first ground of

appeal, that the courts have no jurisdiction to grant diligence on the dependence in respect

of proceedings before an employment tribunal.

The requirements of EU law: an effective remedy

[50] That leads on to the relevance of EU law. The second ground of appeal is that, even if

a procedure for arrestment on the dependence were available in respect of employment

tribunal proceedings, the Lord Ordinary erred in finding that such a procedure provided an

effective remedy to the petitioner. The fact primarily founded on in this respect was that a

separate protective action required to be raised before the ordinary courts. That, it was said,

breached the EU law principle of effectiveness. For this purpose, it is not in dispute that the

rights claimed by the petitioner before the employment tribunal were founded on EU law,

Page 33 ⇓

and in particular on directives aimed at ensuring equal treatment in, inter alia, the area of

employment law.

[51] The principle of effectiveness has been discussed in a substantial number of cases

before the Court of Justice of the European Union, and I will consider that line of authority

shortly. Before doing so, however, I should make a number of preliminary observations in

relation to the fundamental principle of effectiveness and the utility of provisional and

protective measures in securing an effective remedy.

[52] First, the main purpose of the principle of effectiveness is to ensure the proper

enforcement of rights that arise under Community law. That is not an objective that is

confined to the law of the EU. It is encapsulated in the maxim ubi jus ibi remedium, which has

been adopted in Scots law, English law and many other legal systems. It is obvious that if a

legal right exists a remedy must be devised to permit its enforcement; otherwise the right is

ineffectual. This extends not merely to the existence of a notional remedy but to ensuring

that the remedy produces practical results. The principle of effectiveness is accordingly one

that is not peculiar to EU law but is close to principles that are an integral part of most

rational legal systems, and are in particular an integral part of Scots law.

[53] Secondly, diligence is an example of a provisional and protective measure, made

available during the course of litigation in order to avoid so far as possible the risks of the

defender’s insolvency or of the defender’s “removing, disposing of, burdening, concealing

or otherwise dealing with” its assets (see section 15E(2)(b)(ii) of the 1987 Act as amended).

Most other legal systems also allow for provisional or protective measures, although they

take a wide range of different forms; in relation to the main European legal systems, these

are usefully set out on a country-by-country basis in Layton and Mercer, European Civil

Practice, volume 2. By way of example, English law permits the granting of an interlocutory

Page 34 ⇓

injunction to prevent the disposal of assets as litigation proceeds (the so-called Mareva

injunction, exemplified by Amicus v Dynamex Friction Ltd (supra), a case cited by the Lord

Ordinary which involved the grant of such an injunction in the course of proceedings before

an employment tribunal). The Scottish law of diligence appears to have been borrowed from

France in the late mediaeval or early modern period. Despite the very marked differences of

form, diligence and the injunctions used in England and Wales can be said to be functionally

equivalent. The same applies, as I have noted, to all other main European legal systems. For

present purposes, two important points emerge. In the first place, in relation to provisional

and protective measures, the underlying requirements of EU law are already recognized and

given effect by most legal systems, including Scots law. In the second place, those systems

make use of different forms of provisional and protective measure. For that reason it cannot

be said that the EU principle of effectiveness requires any one particular form of procedure.

Any form of measure will suffice provided that it is, objectively, reasonably effective in

providing security.

[54] Thirdly, in cases such as the present, the reason that legal systems put in place

provisional and protective measures is to protect against the possible insolvency of the

defender or the alienation or dissipation of the defender’s assets. Insolvency and the

dissipation of assets are an inevitable risk both in litigation and in the commercial world

generally. Provisional and protective measures during litigation are only one means of

dealing with that risk. Other remedies may exist after assets have been disposed of. In Scots

law, for example, if insolvency occurs procedures exist to permit a trustee in sequestration

or liquidator to challenge gratuitous alienations, where assets are given away for no or

inadequate consideration. This is possible at common law and also under statutory

provisions, which are now found in section 98 of the Bankruptcy (Scotland) Act 2016 and

Page 35 ⇓

section 242 of the Insolvency Act 1986. Likewise, procedures exist to permit a trustee or

liquidator to challenge unfair preferences, where assets are used to give preference to one

creditor rather than another without legal justification; these exist both at common law and

under section 99 of the Bankruptcy (Scotland) Act 2016 and section 243 of the Insolvency Act

1986. (It is perhaps worth noting that the foregoing statutory grounds of challenge are of

some antiquity, being largely modelled on the Bankruptcy Acts of 1621 and 1696). Further

steps can be taken in a formal insolvency process, for example to recover funds that have

been paid in breach of trust or fiduciary duty. The essential point for present purposes is

that diligence is merely one remedy among a substantial number that can be used to enforce

the effective payment of debts owed to successful litigants. In considering the principle of

effectiveness, it is necessary in my opinion to have regard to the totality of remedies that are

available.

[55] Fourthly, although procedures exist to protect against insolvency or the dissipation

of assets, they are not always successful. Insolvency means that debts are not paid in full, or

frequently are not paid at all, and there are inevitable limits to the practical utility of any

remedy in that situation. There are likewise inevitable limits to the practical utility of

diligence on the dependence. On occasion diligence can be very successful in securing a

debt, as where inhibition is used against a unencumbered heritable property, or where

arrestment is used in respect of major items of industrial equipment, such as installations

used in the oil industry (as in the cases cited in paragraph [38] above). In other cases,

however, arrestment may be of very limited utility, not because of any deficiency in the

procedure itself but because of the nature of the assets arrested. In relation to the arrestment

of a bank account, for example, the effect will be to freeze the credit balance in the account at

that moment. If the account is overdrawn nothing is secured. Even if a credit balance is

Page 36 ⇓

secured by arrestment, there is an obvious risk that the defender will divert future payments

to another bank account which is not subject to arrestment and in that way defeat the

diligence. Furthermore, in relation to payments passing through bank accounts, if the

defender carries on business the payments will typically come from its trade debtors and

will be required to pay its trade creditors, its employees, HMRC and others. A trader

requires liquidity in order to continue to pay its creditors, which it must do in order to carry

on business. In these circumstances there is an inevitable limitation on the efficacy of

arrestment. The same is broadly true of other remedies such as an interdict or injunction

prohibiting the disposal of funds; if the effect of such a remedy is to prevent a defender from

carrying on business it may be held disproportionate. For the purposes of the principle of

effectiveness, the important point is that provisional and protective measures are not

invariably successful, and indeed cannot be.

[56] In the present case the Court was provided with a number of financial documents

from the charity that was the petitioner’s employer, notably bank statements from its

account covering the period from August to October 2016. While that is a very limited

period, those statements give an indication as to the manner in which the charity’s activities

were carried on. Payments out of the account covered principally salaries of employees, but

also expenses, generally of a fairly modest nature. They also included payments to what

appear to be a training organisation, to an entity described as “Engage ESF”, to consultants

and to HMRC. The only significant payments into the account were payments of grants, of

relatively modest amounts in relation to the total outgoings. The result was that during the

period from 1 August to 10 October 2016 the credit balance in the account fell from

£61,663.81 to £3,965 46. It is obviously impossible to say whether that period is typical of the

Page 37 ⇓

employer’s financial activities. In the result, the arrestment that was ultimately used by the

pursuer on 28 October 2016 attached funds amounting to £2,967.32.

[57] Nevertheless, the transactions during that period indicate two important features of

the employer’s activities. The first is the need to make regular payments of salary, expenses

and other outgoings. The second is the limited and potentially erratic nature of payments to

the charity. Indeed, it is obvious that, if the charity is ordered by a tribunal to pay a large

financial award to an employee, it is possible that donors on which it depends may reduce

or stop the payments that they make. This is not necessarily remediable in law, as those

payments may be the result of voluntary donations decided from time to time, without

future commitment. Once again, it is impossible to decide whether the outgoings and

receipts disclosed in the bank statements are typical. The fundamental point is that a charity

is frequently dependent on voluntary donations, which may be withheld if it is thought that

they are not going to be used to advance its charitable purposes but to pay compensation to

a former employee. It is very difficult to see how the law can do anything about that. For this

reason, there is a serious question as to whether in the present case arrestment would have

the effect of arresting any significant funds. Inhibition does not appear to be possible, as

there is no indication that the charity owned any heritable property. If, of course, it made

gratuitous alienations or accorded unfair preferences, legal remedies exist to deal with them,

but these have nothing to do with diligence on the dependence.

The relevant EU legislation

[58] In the argument for the petitioner on the principle of effectiveness, reliance was

placed on important legislation governing the operation of the European Union, and also on

the EU legislation prohibiting discrimination. The important legislation is as follows.

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Treaty on European Union (TEU)

[59] Article 19 of the TEU provides:

“1. The Court of Justice of the European Union shall include the Court of Justice, the

General Court and specialised courts. It shall ensure that in the interpretation and

application of the Treaties the law is observed.

Member States shall provide remedies sufficient to ensure effective legal protection

in the fields covered by Union law”.

This provision gives statutory effect to the principle of effectiveness.

The Charter of Fundamental Rights (the Charter)

[60] Article 21 of the Charter deals with a range of categories of discrimination, which

include those relied on by the petitioner. It provides:

“1. Any discrimination based on any ground such as sex, race, colour, ethnic or social

origin, genetic features, language, religion or belief, political or any other opinion,

membership of a national minority, property, birth, disability, age or sexual

orientation shall be prohibited.

2. Within the scope of application of the Treaties and without prejudice to any of

their specific provisions, any discrimination on grounds of nationality shall be

prohibited”.

Article 47 of the Charter repeats the principle of effectiveness; it provides:

“Right to an effective remedy and to a fair trial

Everyone whose rights and freedoms guaranteed by the law of the Union are

violated has the right to an effective remedy before a tribunal in compliance with the

conditions laid down in this Article.

Everyone is entitled to a fair and public hearing within a reasonable time by an

independent and impartial tribunal previously established by law. Everyone shall

have the possibility of being advised, defended and represented.

Legal aid shall be made available to those who lack sufficient resources in so far as

such aid is necessary to ensure effective access to justice”.

[61] Article 52 of the Charter provides, inter alia:

“Scope and interpretation of rights and principles

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1. Any limitation on the exercise of the rights and freedoms recognised by this

Charter must be provided for by law and respect the essence of those rights

and freedoms. Subject to the principle of proportionality, limitations may be

made only if they are necessary and genuinely meet objectives of general

interest recognised by the Union or the need to protect the rights and

freedoms of others. …”.

This amounts in effect to a restatement of the general principle of legality, that limitations on

rights and freedoms must be the subject of legal provision, and the general principle of

proportionality, that any such limitation should be necessary and aimed in a proportionate

manner at objectives of general interest. These are very general features of EU law, and have

also generally been adopted in the interpretation of the European Convention on Human

Rights, which is of course the basis for the Charter.

Council Directive 2000/78/EC

[62] Council Directive 2000/78/EC lays down a general framework for countering

discrimination on the grounds of religion or belief, disability, age or sexual orientation as

regards employment and occupation in order to give effect to the EU law principle of “equal

treatment”. Article 9 (Defence of rights) provides, inter alia:

“1. Member States shall ensure that judicial and/or administrative procedures,

including where they deem it appropriate conciliation procedures, for the

enforcement of obligations under this Directive are available to all persons who

consider themselves wronged by failure to apply the principle of equal treatment to

them, even after the relationship in which the discrimination is alleged to have

occurred has ended.”

Article 17 (Sanctions) provides:

“Member States shall lay down the rules on sanctions applicable to infringements of

the national provisions adopted pursuant to this Directive and shall take all

measures necessary to ensure that they are applied. The sanctions, which may

comprise the payment of compensation to the victim, must be effective,

proportionate and dissuasive. …”

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The foregoing provisions can be regarded as a more specific restatement of the general

principle of effectiveness, including the provision of an effective remedy.

Council Directive 2000/43/EC

[63] Council Directive 2000/43/EC has as its aim the implementation of the principle of

equal treatment between persons irrespective of racial or ethnic origin. It contains provisions

which can be regarded as restating the principle of effectiveness, including the provision of

an effective remedy. Thus article 7 (Defence of rights) provides, inter alia:

“1. Member States shall ensure that judicial and/or administrative procedures,

including where they deem it appropriate conciliation procedures, for the

enforcement of obligations under this Directive are available to all persons who

consider themselves wronged by failure to apply the principle of equal treatment to

them, even after the relationship in which the discrimination is alleged to have

occurred has ended.”

Article 15 (Sanctions) provides:

“Member States shall lay down the rules on sanctions applicable to infringements of

the national provisions adopted pursuant to this Directive and shall take all

measures necessary to ensure that they are applied. The sanctions, which may

comprise the payment of compensation to the victim, must be effective,

proportionate and dissuasive. …”.

Council Directive 2006/54/EC

[64] Council Directive 2006/54/EC deals with the implementation of the principle of equal

opportunities and equal treatment of men and women in matters of employment and

occupation. In a recast form, it provides, at Article 17 (Defence of rights):

“1.

Member States shall ensure that, after possible recourse to other

competent authorities including where they deem it appropriate conciliation

procedures, judicial procedures for the enforcement of obligations under this

Directive are available to all persons who consider themselves wronged by failure to

apply the principle of equal treatment to them, even after the relationship in which

the discrimination is alleged to have occurred has ended.”

Article 18 (Compensation or reparation) provides:

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“Member States shall introduce into their national legal systems such measures as

are necessary to ensure real and effective compensation or reparation as the Member

States so determine for the loss and damage sustained by a person injured as a result

of discrimination on grounds of sex, in a way which is dissuasive and proportionate

to the damage suffered. Such compensation or reparation may not be restricted by

the fixing of a prior upper limit, except in cases where the employer can prove that

the only damage suffered by an applicant as a result of discrimination within the

meaning of this Directive is the refusal to take his/her job application into

consideration”.

Once again these can be regarded as a restatement of the general principles of effectiveness

and provision of an effective remedy.

The EU case law

[65] Founding on the foregoing EU legislation, counsel for the petitioner advanced

detailed submissions on the correct approach that a national court should adopt towards the

principles of effectiveness and the provision of an effective remedy. He submitted that the

law in this area had developed since the early years of the European Economic Community,

and was now to be interpreted in a stricter manner than previously. In particular, the Lord

Ordinary had relied on the decision of the Court of Justice in Impact v Minister for Agriculture

and Food, supra, decided in 2008, but it was submitted that the law had moved on

substantially since then, following a line of development that had been apparent for some

time previously.

[66] The primary submission for the petitioner was that three strands could be seen in the

development of the law by the Court of Justice. The first of these, dating from cases decided

in the 1960s, was that Community directives had “direct effect”, a translation of the French

“effet utile”, which meant that the directive should have full force and effect within the

territory of member states. The second strand, which derived from cases decided in the

1980s, involved respect for the procedural autonomy of member states. Community law did

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not impose new remedies, but relied on member states to adapt their existing remedies to

ensure the effectiveness of Community law. This was made subject to an important

limitation, namely that national procedures were not to be applied in a manner that made it

“practically impossible or excessively difficult” to enforce Community law. That test, as

explained in cases such as Impact v Minister for Agriculture and Food, supra, was used by the

Lord Ordinary. It was submitted, however, that the law had developed since then, to create

a third strand in the development of the law. The Lisbon Treaty had come into effect in 2004,

and article 19(1) of the TEU (see paragraph [59] above) required that member states should

provide remedies sufficient to ensure effective legal protection in fields covered by EU law.

That, it was submitted, replaced the existing principle that EU law did not require states to

create new remedies. A similar result was required by articles 21 and 47 of the Charter (see

paragraph [60] above). Thus it was said that there was now a general right to an effective

remedy, unconstrained by existing procedures available in a member state.

[67] In Impact v Minister for Agriculture and Food, supra, the substantive question was

whether “unestablished” civil servants in Ireland were entitled, in terms of the relevant

directive, to equal treatment in respect of pay and pension rights with established civil

servants. Under Irish law, the claims were presented initially to an official known as a Rights

Commissioner, and the question arose as to whether the Rights Commissioner had

jurisdiction to apply EU law in cases where it was inconsistent with national law. The Grand

Chamber of the Court of Justice held (at paragraphs 44-46) that it was for the domestic legal

system of each member state to designate the courts and tribunals having jurisdiction and to

lay down the detailed procedural rules governing actions for safeguarding rights which

individuals derived from Community law. It was the responsibility of the member states to

ensure that those rights are “effectively protected” in each case (paragraph 45). The detailed

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rules governing actions derived from Community law rights “must be no less favourable

than those governing similar domestic actions (principle of equivalence) and must not

render practically impossible or excessively difficult the exercise of rights conferred by

Community law (principle of effectiveness)” (paragraph 46). Thus the Irish legislature was

entitled to confer jurisdiction on a person such as the Rights Commissioner to determine the

claims, but the Court further held that the principle of effectiveness would be contravened if

such a requirement would result in procedural disadvantages for the claimants in terms of

cost, duration of proceedings or the rules governing representation, such as to render

“excessively difficult” the exercise of rights arising from the directive.

[68] It is clear from the opinion of the Court in Impact that the primary test is whether

procedural requirements render “excessively difficult” the enforcement of a Community

right. The expression “practically impossible” is used, but it seems obvious, as a matter of

language, that anything that was practically impossible would fall foul of the test of

excessive difficulty. The test of excessive difficulty clearly involves evaluation, or a form of

proportionality. It is not the case that an additional procedural requirement to obtain an

effective remedy will automatically contravene the principle of effectiveness. The question is

rather whether the difficulty and cost of complying with that requirement is excessive,

which is a matter of judgment. If that test is applied in the present case, the critical question

is whether the requirement to raise proceedings in the sheriff court, in addition to the claim

made before the employment tribunal, makes an effective remedy excessively difficult for

claimants such as the present petitioner.

[69] In the present proceedings, reference was made to a number of more recent cases in

which the Court of Justice discussed the principle of effectiveness. I do not think that these

add a great deal to the modern statements of the principle of effectiveness found in article 19

Page 44 ⇓

of the TEU and article 47 of the Charter. Nevertheless, because considerable reliance was

placed on them by counsel, I will comment briefly on the more important of them. Perhaps

pre-eminent among them was the very recent decision in Case C-193/17, Cresco Investigation

GmbH v Achatzi, [2019] IRLR 380. In that case, Austrian legislation permitting days off work

for church members on religious holidays was said to have discriminated against persons

who were not members of the churches concerned. For present purposes, the most

significant issue was what ought to be done if the legislation were held to be discriminatory

in terms of EU law before the legislature adopted a new non-discriminatory regime. The

Advocate General recommended that the remedy was to disapply or set aside the national

provision that was in breach of EU law, but that would not confer any immediate benefit on

the employee, who was seeking payment of additional holiday pay from his employer. The

Court of Justice held that the prohibition on discrimination on grounds of religion or belief,

laid down in article 21 of the Charter (paragraph [60] above), was sufficient to confer on

individuals a right on which they might rely in disputes in a field covered by EU law. On

that basis, article 21 of the Charter was no different in principle from provisions of the

founding Treaties prohibiting discrimination on various grounds, even where the

discrimination derived from contracts between individuals (paragraph 76-77).

[70] The Court concluded that in such a case observance of the principle of equality could

be ensured only by granting to persons within the disadvantaged category the same

advantages as those enjoyed by persons within the favoured category, and that in such a

case the national court should set aside the offending provision and then allow the

disadvantaged group the same arrangements as those enjoyed by the favoured group

(paragraphs 79-80). For the present petitioner it was argued that that supported the

proposition that a “third strand” has emerged in relation to the principle of effectiveness, to

Page 45 ⇓

the effect that an individual should have a direct remedy against persons who discriminated

against them, even where such discrimination is lawful in terms of national law. In my

opinion that goes beyond what was actually decided. The effect of the case is that the Court

of Justice allows individuals a direct remedy against persons who discriminate against them,

even when such discrimination is lawful in terms of national law. That, however, appears to

amount to nothing more than the basic principle of the primacy of EU law, taking into

account the obligation incumbent on member states under article 19 of the TEU to provide

effective remedies. That is not a “third strand”, but rather a restatement of the legal

principles found in earlier cases, including Impact, the primary authority founded on by the

Lord Ordinary.

[71] The petitioner also founded on another recent case before the Court of Justice, Case

C-378/17, Minister for Justice and Equality, Commissioner of An Garda Síochána v Workplace

Relations Commission, 4 December 2018. This was said to vouch the proposition that, if it is

necessary to take the additional step of going to another court to obtain a remedy, that of

itself made the remedy “less effective”. In An Garda Síochána it was claimed that certain age

limits imposed by Irish legislation for police recruits amounted to discrimination contrary to

Community law. The claim was presented to the statutory body responsible under national

law for deciding such cases, the Equality Tribunal (which became the Workplace Relations

Commission), but the relevant Minister argued that that Tribunal lacked jurisdiction because

it had no power to disapply the provision of Irish law that laid down the upper age limit;

only a court could do so. The issue, as interpreted by the Court of Justice, was accordingly

whether the primacy of EU law precluded national legislation which had the result that a

national body established to ensure enforcement of EU law in a particular area had no

jurisdiction to disapply a rule of national law that was contrary to EU law. The Court drew a

Page 46 ⇓

distinction between on one hand the power to disapply in a particular case a provision of

national law that was contrary to EU law, and on the other hand the power to strike down

such a provision so that the provision of national law was no longer valid for any purpose

(paragraph 33). In the case under consideration, as the WRC was the body established in the

purpose of satisfying Ireland’s obligations under Directive 2000/78, it must be capable of

disapplying if necessary any provision of national legislation contrary to the Directive

(paragraphs 45-46). The Court concluded (at paragraph 50):

“It follows from the principle of primacy of EU law… that bodies called upon, within

the exercise of their respective powers, to apply EU law are obliged to adopt all the

measures necessary to ensure that EU law is fully effective, disapplying if need be

any national provisions or national case-law that are contrary to EU law. This means

that those bodies, in order to ensure that EU law is fully effective, must neither

request nor await the prior setting aside of such a provision or such case-law by

legislative or other constitutional means”.

[72] The petitioner relied on this case as supporting the principle that, if a member state

sets up a specialist court to hear claims based on discrimination contrary to EU law, it must

provide those courts with all the remedies that are necessary to ensure the “full

effectiveness” of EU law. Thus it was said that an employment tribunal in the United

Kingdom requires to have power to grant provisional and protective remedies such as

diligence on the dependence in order that EU law might be fully effective. While some of the

statements made by the Court of Justice, notably that at paragraph 50, may be construed as

indicating that a tribunal charged with applying EU law must have every form of

enforcement remedy available to it, it is important in my opinion to take the statements

made in An Garda Síochána in context. That context is that the case was concerned with the

ability of a tribunal to disapply national law provisions that run directly contrary to

discrimination provisions in an EU Directive. That was what the WRC was prohibited from

Page 47 ⇓

doing by the Irish constitution. In the present case, by contrast, the question is not whether

the rules of EU discrimination law, as laid down in Directives, are to be applied by the

employment tribunal. It is quite clear that the tribunal must apply those rules, as the tribunal

did in the present case. What is in issue is not the primary question of the supremacy of EU

law over national law, but the availability of remedies designed to provide security during

litigation and effective enforcement of a financial award following the end of such litigation.

That is a wholly different issue. It involves a wide range of remedies, which go beyond

provisional and protective measures during litigation and include formal insolvency

proceedings and the remedies that are available in such proceedings. In my opinion nothing

in An Garda Síochána can be construed as suggesting that remedies of that nature must be

available in an employment tribunal. These are in effect secondary remedies, designed to

enforce an award. The primary remedy, the making of the award itself, is clearly competent,

and that is all that is required in terms of the decision of the Court of Justice in An Garda

Síochána.

[73] Reliance was placed on another recent case before the Court of Justice, Case C-73/16,

Puškár v Finančné riaditiel’stvo Slovenskej republiky, [2017] 4 WLR 209. This case was said to lay

down the test for determining whether the requirement that the national legal system

should provide effective remedies had been met in accordance with the “third strand” of

approaches to effectiveness. In that case the appellant had sought to prevent his name from

being included on a list held by the state of suspected “front men” for companies involved

in tax evasion. Under national law persons such as the appellant were obliged to exhaust

administrative procedures before a complaint could be brought before a court that the

relevant national legal provision was in breach of EU law. The Court of Justice relied on

article 47 of the Charter, and held that a requirement that administrative remedies should be

Page 48 ⇓

exhausted prior to raising judicial proceedings could only be justified if the procedure was

provided by law, respected the essence of the right enshrined in article 47 and, in accordance

with the principle of proportionality, was necessary and genuinely met objectives of general

interest recognized by the European Union, or met the need to protect the rights and

freedoms of others (paragraph 62). If those requirements were satisfied, however, it was

permissible for national legislation to make the exercise of a judicial remedy subject to the

prior exhaustion of available administrative remedies. That was subject to the requirement

that this did not lead to a substantial delay or involve excessive costs (paragraph 76). In my

opinion there is nothing in this decision that suggests that it is contrary to the principle of

effectiveness to require a separate application to a court for provisional or protective

measures, provided that such an application does not involve substantial delay or involve

excessive expense.

[74] Finally, although it is a decision of the United Kingdom Supreme Court rather than

the Court of Justice, I should mention that some reliance was placed on the recent decision

in R (UNISON) v Lord Chancellor, [2017] 3 WLR 409. The decision is concerned principally

with the right of access to justice at common law, although there is some discussion of the

EU principles of effectiveness and effective judicial protection. The case involved a

successful judicial challenge to the level of fees specified in a new Fees Order applicable to

employment tribunals. It is important to note that the UK Supreme Court had considerably

more information about the financial impact of the Order than was available in the present

case, where the information about the likely expenses involved in making a subsidiary

application to the sheriff court to obtain diligence on the dependence was almost entirely

lacking in specification. The court concluded that fees had been set at a level where there

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was a real risk that access to justice was being denied. The evidence for this was a sharp and

substantial fall in claims made in employment tribunals (paragraph 91).

[75] Many of the rights enforceable in employment tribunals are derived from EU

directives, and consequently the UK Supreme Court gave some consideration to the

requirements of EU law (paragraphs 105 et seq). The court referred to the principle of

effectiveness, and adopted the test stated in Impact, namely that “the procedural

requirements for domestic actions must not be ‘liable to render practically impossible or

excessively difficult’ the exercise of rights conferred by EU law”. That is of course the test

that was used by the Lord Ordinary in the present case. The court in UNISON further

referred to the EU principle of effective judicial protection, as stated in articles 6 and 13 of

the European Convention on Human Rights and as reaffirmed by article 47 of the Charter. In

relation to the cost of litigation, the court concluded (paragraph 107) that the imposition of a

financial restriction on access to a remedy required that there should be a reasonable

relationship of proportionality between the means employed and the legitimate aims sought

to be achieved. The burden lay on the state to establish that restrictions by way of expenses

were proportionate where such restrictions were liable to jeopardize the implementation of

the aims pursued by EU Directives.

[76] In my opinion the discussion in UNISON largely reaffirms the approach of the Court

of Justice in Impact. The result is that the critical test is whether particular procedural

requirements can be said to be “excessively difficult”, bearing in mind the aims that the

relevant provision of EU law seeks to achieve. That essentially involves a proportionality

exercise; it is a matter of judgment for the court. The court in UNISON refers to the principle

of effective judicial protection, a principle that is contained in the European Convention on

Human Rights and is based ultimately on rights of access to the courts in domestic law. So

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far as the present case is concerned, it is quite clear that a claimant before an employment

tribunal has a right of access to the judicial system. The employment tribunals are specialist

courts designed to deal with disputes relating to contracts of employment, and there is a

right of appeal from them to the Employment Appeal Tribunal and from there in

appropriate cases to the general courts. The question for present purposes is accordingly

whether the requirement to seek diligence on the dependence from a court rather than the

employment tribunal renders the obtaining of interim security excessively difficult in all the

circumstances.

[77] The argument for the petitioner made reference to a number of other cases before the

Court of Justice, but for present purposes I do not think that it is necessary to refer to these.

The fundamental point is that, as a matter of EU law, it is essential that the national

authorities confer an effective remedy on any person who asserts a right based on EU law.

For this purpose, in my opinion, the “three strands” approach suggested on behalf of the

petitioner is not of great assistance. It is clear from a line of Luxembourg authorities that if

obtaining a remedy is “excessively difficult” the remedy will not be effective; that is the clear

result of cases such as Impact. The ultimate question, however, is whether an “effective

remedy” has been provided. That is the wording used in article 19 of the TEU and article 47

of the Charter, and I can see little advantage in attempting to provide an elaborate gloss on

the wording used in the main EU treaties. Conceptually the notion of an effective remedy is

relatively straightforward. The difficulty arises in applying the test in the circumstances of

individual cases. On that question, I am of opinion that the court must consider what

remedy is required in the particular case to obtain recognition of the right that exists under

EU law, and what remedy is required to ensure that that remedy is implemented at a

practical level. To the extent that procedural steps have to be taken, or fees have to be paid,

Page 51 ⇓

to achieve either recognition of the primary right or a remedy to secure practical

implementation of that right, the court must embark on what is essentially a proportionality

exercise: are the procedural steps required, or the fees, disproportionate in all the

circumstances? That is the exercise that must be performed in relation to protective remedies

in employment tribunal proceedings in Scotland.

Whether Scots law provides an effective remedy for the purposes of EU law

[78] In the circumstances of the present case, the important question is not whether rights

accorded to employees by EU Directives are recognized by Scots law through judicial

determination. The rights of the petitioner under the relevant Directives have been

recognized by the employment tribunal, and it has been held that the petitioner’s rights have

been infringed. The critical question is the availability of financial redress for the

infringement of those rights. Once again, the entitlement to financial redress has been

recognized. The dispute relates rather to the means whereby that redress is provided, in the

concrete form of payment of compensation.

[79] For reasons already set out, at paragraphs [41]-[43] and [46]-[49] above, I am of

opinion that diligence on the dependence is available in employment tribunal proceedings

by means of a subsidiary action in either the sheriff court or the Court of Session. That

obviously involves an additional procedural step, and a certain amount of expense.

Nevertheless, the procedural step is relatively straightforward. All that is required is a court

action in which the pursuer concludes for the amount sought in the employment tribunal

proceedings. The condescendence should be very short, narrating the existence of the claim

in the employment tribunal and averring that the pursuer will obtain decree in that tribunal.

Those are the requirements referred to by the Lord Justice-Clerk in Fordyce v Bridges (see

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paragraph [37] above), and they represent a procedure that has regularly been followed in

relation to arbitration. The summons must obviously contain a warrant for arrestment and

inhibition on the dependence, but that is essentially a formality. It is likely that a hearing

will be required in relation to the financial situation of the defender, the employer, and any

risk that there may be of dissipation of assets. Nevertheless, that would be required even if it

were possible to obtain a warrant for diligence on the dependence in employment tribunal

proceedings. The extra requirement under the current Scottish procedure is simply that a

parallel writ or summons must be drafted, lodged and served. The contents of that writ or

summons, however, can and should be very brief indeed.

[80] In my opinion the foregoing procedures do not contravene the principle of

effectiveness, or an effective remedy, under EU law. The additional writ or summons that is

required will be short and simple and should be inexpensive. If the test is that an effective

remedy should not be “excessively difficult” (the Impact test), I consider it very clear that the

straightforward procedures required in the sheriff court are not excessively difficult. Even if

a more straightforward test of effectiveness, or an effective remedy (the wording of article 47

of the Charter), is followed, I am of opinion that the existing law of diligence provides an

effective remedy. Diligence on the dependence of an action permits the pursuer to use a

protective remedy during the course of litigation against both moveable and immoveable

property. It operates to reduce so far as possible the risks of the defender’s insolvency or of

the defender’s “removing, disposing of, burdening, concealing or otherwise dealing with”

its assets. That is as much as can be expected of a provisional measure during litigation.

Clearly it cannot be effective in every case, because insolvency may supervene, or assets may

have been alienated before the available procedure is made effective, or it may be used

against fluctuating assets such as a bank account. It is impossible to provide a guarantee

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against insolvency, for very obvious reasons: see paragraph [55] above. It is equally

impossible to provide a completely certain remedy against fluctuating assets simply because

of the nature of such assets.

[81] Apart from the relatively straightforward nature of the proceedings required in

court, relying on the ordinary courts to deal with diligence has certain practical advantages.

The purpose of setting up the employment tribunal to deal with employment-related claims

is that it provides an informal and cost-free procedure before a specialist tribunal. That

procedure is, however, aimed at employment law, and the members of the employment

tribunals are experts in that area. Diligence, by contrast, raises a range of legal issues that are

not related to employment law. They are rather concerned with property and insolvency

law: issues such as the threat of insolvency, or the alienation or dissipation of assets. They

also concern the limitations on the availability of the remedy of diligence that were

introduced by sections 15A-15F of the Bankruptcy and Diligence etc (Scotland) Act 2007.

Those limitations were introduced to deal with the human rights concerns that had been

raised by the Scottish Law Commission and in the case of Karl Construction Ltd v Palisade

Properties Ltd, supra. In view of the range of legal issues that are liable to be raised by

diligence, there are likely to be practical advantages in having those matters heard before an

ordinary court, which will deal with other property- or insolvency-related issues. For the

foregoing reasons, the requirement that diligence should be obtained through ancillary court

proceedings appears to me to be a proportionate response to the question of how

provisional and protective measures may be obtained in the course of litigation relating to a

contract of employment.

[82] Furthermore, other remedies may be available. For example, it is competent in

appropriate cases for the pursuer to obtain an interim interdict against the disposal or

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dissipation of assets; that appears to have occurred in the present case, although it was not

effective in practice owing to the insolvency of the petitioner’s employer and line manager.

Further remedies are available through insolvency procedures, for example through the

reduction of gratuitous alienations or the recovery of assets alienated in breach of trust or

breach of fiduciary duty. In the present case is not clear how effective such remedies might

be. A large part of the difficulty confronting the petitioner appears to have been the nature

of the economic activities of the petitioner’s employer, which I have discussed at paragraphs

[56] and [57] above. The fundamental problem was that the petitioner’s employer lacked a

sound asset base, largely because it was dependent on charitable donations. If assets are not

available, an effective remedy for payment of compensation is unlikely to be available, but

that is not for any reasons inherent in the legal system. It follows that the fact that payment

of compensation was not achieved does not indicate that the legal system does not provide

an effective remedy; the inability to recover funds may be due to financial and economic

factors rather than legal shortcomings. In all the circumstances, therefore, I conclude that

Scots law does provide an effective remedy for the purposes of EU law, and article 19 of the

TEU and article 47 of the Charter in particular.

[83] Before I leave the question of an effective remedy, I should mention three further

matters. First, the fact that the Scottish remedy takes a different form from those used in

other EU jurisdictions is clearly immaterial. Different jurisdictions within the EU adopt

different procedural systems, which often differ markedly; this is well illustrated by the

differences in procedure between Scots law, where the procedures tend to have civilian or in

some cases (including diligence) early modern French origins, and the law of England and

Wales, where the various procedures available at common law and in equity have

indigenous origins and differ sharply from the procedures found in continental Europe.

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What EU law requires is an effective remedy; the precise procedures must be a matter for

national legal systems.

[84] Secondly, the intervener, the Commission for Equality and Human Rights, stated

that they were unaware of any case where a claimant in proceedings before an employment

tribunal had used diligence on the dependence through the means of a parallel court action.

Nevertheless, the lack of any known cases may be explained by various reasons. An obvious

explanation is that lawyers who act for claimants before employment tribunals are unaware

of the procedures that are used in, for example, arbitration proceedings to obtain diligence

on the dependence through the use of an ancillary court action. Another is that in many

cases the employer’s assets may not be well suited to the use of diligence. If, for example, the

employer does not own any heritable property inhibition will be largely pointless, and the

effectiveness of arrestment against assets such as sums in bank accounts is inevitably

limited.

[85] Thirdly, the intervener provided research material that suggested that significant

numbers of successful claimants in employment tribunal proceedings receive none of, or

only part of, the awards made in their favour. The statistics related principally to England

and Wales, but a number of reports suggested low rates of recovery. A 2009 Ministry of

Justice report indicated that 39% of successful claimants had not received any payment and

8% had been paid only part of the award. In a further report in 2013 the corresponding

figures were 35% and 16% respectively. Even “after the event” enforcement action for

recovery of employment tribunal awards was not always successful. In the 2013 study

commissioned by the UK Government into the payment of tribunal awards 46% of Scottish

claimants reported that they continued, post-enforcement, not to have received any

payment; the corresponding figure for England and Wales was 35%. Those figures are

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clearly disappointing, but the fundamental problem may well be that of insolvency: at the

very least, it is impossible to draw the conclusion that Scots law does not provide an

effective remedy on the basis of such statistical evidence alone. As I have already stated, for

obvious reasons it is impossible to provide a guarantee against insolvency.

The requirements of EU law: equivalence

[86] In addition to the principle of effectiveness, the argument for the petitioner founded

to some extent on the EU law principle of equivalence. This principle requires that a person

who wishes to enforce a right derived from EU law must be accorded substantially the same

remedy as a person who wishes to enforce an equivalent right derived solely from domestic

law. That obviously raises the question of what amounts to equivalence of rights. For this

purpose, it is essential to determine the correct comparator. In the present case, the

petitioner seeks to enforce rights derived from EU law that apply in an employment

relationship in litigation before the employment tribunal, which is responsible for legal

questions that arise in relation to employment contracts. For the respondent, it is contended

that the appropriate comparator is found in other employment-related proceedings before

the employment tribunal which are based on domestic law. An example would be a

straightforward claim for unfair dismissal. It is not in dispute that the remedies available to

the present petitioner by way of diligence are the same as those that would apply to a

claimant before the employment tribunal whose claim was based on unfair dismissal.

[69] For the petitioner, by contrast, it is contended that the appropriate comparator is not

found in other proceedings before the employment tribunal but in proceedings for

discrimination prohibited under EU law that are brought before the ordinary courts. An

example would be a claim for discrimination prohibited by EU Directives in relation to a

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contract for the sale of goods or supply of services; for example where a trader refused to

deal with a potential customer because of his or her ethnic background. In cases of that sort,

brought before the ordinary courts, diligence would be available without the need to raise

ancillary proceedings before another court or tribunal.

[87] The Lord Ordinary held that there had been no breach of the EU law principle of

equivalence. He had decided that an application for interim diligence by means of sheriff

court proceedings was open to the petitioner. On that basis it made no difference what the

comparable domestic proceedings were, since effective interim protection was available by

means of an ancillary action. The Lord Ordinary further held that the appropriate

comparator was an employment law claim not derived from EU law. The essential focus was

on the fact that the claim related to rights under a contract of employment. Claims based on

a contract of employment were comparable, whether derived from EU law or from domestic

law. Claims based on a contract for the supply of goods or services, by contrast, were not

comparable with employment-based claims; they related to a wholly different type of legal

relationship.

[88] In my opinion the Lord Ordinary was correct in so holding. The appropriate

comparator is another employment-related claim, and not a claim based on EU directives

that prohibit discrimination across a range of sectors. The essence of the comparison is that

the claim is employment-based. Claims come before the employment tribunal because they

are based on contracts of employment. That tribunal provides a specialized forum for such

claims where they can be litigated at minimal expense. The obvious comparator is between

claims in that forum that are based on EU law and those that are based on domestic law. In

my opinion this represents common sense. The comparators suggested by the petitioner, by

contrast, focus not on the general nature of the claim, one that is employment-related, but on

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the legislation that underlies the claim. The EU legislation in question, however, applies

across a wide range of different situations in which discrimination may occur. Against that

background, comparison based on the origins of the parties’ legal rights and obligations

appears artificial. Perhaps more importantly, it would have the result that a claim based on

EU-derived rights could never be compared against a claim based on domestic rights. If that

is so, it is difficult to see what the principle of equivalence could ever add to the principle of

effectiveness.

[89] Furthermore, in agreement with the Lord Ordinary, I consider that there is no reason

why domestic law should not adopt different types of procedure for different categories of

claim. In the present case, the distinction is between claims based on contracts of

employment, where the regime based on the system of employment tribunals is applicable,

and other forms of claim, for example relating to the supply of goods or services, which

come before the ordinary courts. The underlying EU principle of non-discrimination must be

pursued under both of those regimes, but that is clearly possible.

Case law

[90] In the course of argument reference was made to certain decided cases that were said

to have a bearing on the principle of equivalence. Totel Ltd v Revenue and Customs

Commissioners, [2018] 1 WLR 4053, concerned equivalence between value added tax, which is

a tax based on EU law, and wholly domestic taxes such as income tax, capital gains tax and

stamp duty land tax. Under the VAT legislation, a UK-registered taxpayer was required to

make payment of disputed VAT before an appeal to the First-tier Tribunal could be

entertained. The case proceeded ultimately to the United Kingdom Supreme Court, which

found that the principle of equivalence required that the procedural rules of member states

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applicable to claims based on EU law should be no less favourable than those governing

similar wholly domestic claims. The principle of equivalence was essentially comparative;

what was required for the principle to be engaged was the identification of one or more

similar procedures for the enforcement of claims arising in domestic law (paragraph 7). That

required determination of an appropriate comparator, and in choosing a comparator regard

must be had to context (paragraph 8). Furthermore, member states were entitled to treat

different claims differently where the differences were “attributable to, or connected with,

differences in the underlying claims” (paragraph 11). This was described as a matter of

common sense, a view with which I agree. When context was considered, the court held that

none of the wholly domestic taxes cited was a true comparator. The fundamental point was

that VAT ultimately falls on the final consumer, but at each stage of the process leading to

the sale to the final consumer the trader collects tax from its customer and pays it to HMRC

(paragraph 23). From that tax the trader deducts the tax that it has paid to its supplier. On

that basis, the paradigm trader was essentially a tax collector, who collected VAT from its

customers and accounted for it to HMRC (paragraph 26). In that context, it was

proportionate to require the trader to account for the VAT that it had collected as a condition

of pursuing an appeal.

[91] When that reasoning is applied to the present case, I am of opinion that it strongly

supports the view that the appropriate comparators for claims based on discrimination at

work are other employment-related claims, brought against an employer, and not claims

brought against persons such as traders who supply goods or services. The contract of

employment provides the overall context for all claims brought against an employer,

whether based on EU law or purely domestic law. A supplier of goods or services, however,

enters into a different type of contract, whose detailed rules deal with different problems

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from those that arise in employment law. Furthermore, the general legislation that provides

the background for the two categories of case, employment on one hand and the supply of

goods or services on the other, is quite different. I accordingly consider that those two types

of contract do not form an appropriate comparator. It follows that the petitioner’s claim

based on the principle of equivalence must fail.

Certainty and settled law

[92] The final ground of appeal related to the requirements for transposition of EU-

derived rights into national law. It was submitted, on the authority of Case C-456/08,

Commission v Ireland, [2010] ECR I-859, that in transposing EU directives into national law

the legislation in context should be sufficiently clear and precise to enable the parties

concerned to be fully informed of their rights so that they could, if necessary, avail

themselves of those rights before the national courts. Reliance was also placed on an earlier

case, Case C-392/96, Commission v Ireland, [1999] ECR I-5901, where it was held that in

considering whether the transposition of a directive was inadequate, it was not necessary to

establish the actual effects of the legislation that purported to effect such transposition;

instead the wording of the legislation itself revealed the insufficiencies or defects of

transposition. It was argued that, on this basis, the legislation transposing the EU directives

relating to work-based discrimination were inadequate, so far as Scotland is concerned,

because they did not provide fully effective interim remedies.

[93] In my opinion this argument must be rejected. My primary reason for so holding is

that, on a proper analysis of the existing law governing diligence, it is apparent that an

adequate remedy is available to provide interim protection during litigation. Moreover,

what is involved in this context is not the transposition of the rights created by a directive

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into national law. That exercise normally involves taking the wording of the directive and

providing a national equivalent, sometimes using the same wording but on occasion altering

that wording. It is in cases of the latter sort that the problem of transposition arises. The

present case, by comparison, does not involve the transposition of directives. It rather

concerns aspects of procedure that apply not only to the directives in question but to a wide

range of other remedies. Those procedures are governed primarily by rules of domestic law,

and the critical question is whether they apply to EU-derived claims in such a way as to

confer an effective, or equivalent, remedy. The issue that arose in the two Commission v

Ireland cases cited in the last paragraph therefore does not arise.

Anonymity

[94] There remains the question of whether in this case the petitioner’s identity should be

anonymised in the court’s opinions. On this matter I am in complete agreement with your

Lordship in the chair that there is no basis for granting anonymity.

Conclusion

[95] For the foregoing reasons I am of opinion that the Lord Ordinary reached the correct

conclusion for the correct reasons. This reclaiming motion must accordingly fail.

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FIRST DIVISION, INNER HOUSE, COURT OF SESSION

Lord President

Lord Drummond Young

Lord Malcolm

OPINION OF LORD MALCOLM

[2019] CSIH 43

P249/17

in the Reclaiming Motion by

ANELA ANWAR

Petitioner and Reclaimer

against

THE ADVOCATE GENERAL

(representing the Secretary of State for Business, Energy and Industrial Strategy)

Respondent

and

THE COMMISSION FOR EQUALITY AND HUMAN RIGHTS

Interveners

Petitioner and Reclaimer: O’Neill QC, Blair; Drummond Miller LLP (for McClure Collins,

Glasgow)

Respondent: Crawford QC, Komorowski; Office of the Advocate General

Interveners: C O’Neill (sol adv); Solicitor to the Commission

2 August 2019

[96] On the main issues in the case I agree with the opinion of Lord Drummond Young.

On the matter of anonymity I agree with your Lordship in the chair.

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[97] As to interim diligence granted by a sheriff, the warrant would be based on a

competent action, albeit one in which the merits of the parties’ dispute are not in issue. This

latter element avoids any conflict with the terms of the Equality Act 2010 concerning

employment claims.

[98] An argument can be made that the powers of the employment tribunal should be

extended to include the grant of interim protection in security of a claim. (Equally, as

explained by Lord Drummond Young, there are cogent reasons for retaining the exclusive

jurisdiction of the court system.) However it does not follow that in the meantime there is a

breach of EU law, which recognises a wide degree of national procedural autonomy. The

test for lack of an effective remedy is one of practical impossibility or excessive difficulty. I

am not persuaded that it has been met.

[99] I would refuse the reclaiming motion, and recall those parts of the interlocutor of

29 March 2017 which granted anonymity and imposed reporting restrictions.