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You are here: BAILII >> Databases >> First-tier Tribunal (Tax) >> M v Revenue & Customs [2010] UKFTT 356 (TC) (30 July 2010)
URL: http://www.bailii.org/uk/cases/UKFTT/TC/2010/TC00638.html
Cite as: [2010] UKFTT 356 (TC), [2010] STI 2863, [2010] SFTD 1141
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'M' v Revenue & Customs [2010] UKFTT 356 (TC) (30 July 2010)
NATIONAL INSURANCE CONTRIBUTIONS
Liability
[2010] UKFTT 356 (TC)
TC00638
Appeal number: TC/2009/10897
National Insurance contributions - gender dysphoria - determination of pensionable age – whether possible to interpret ‘woman’ as including person with gender dysphoria living as a woman – whether directly effective right under Directive 79/7 to cease paying contributions otherwise than by satisfying conditions for recognition under the Gender Recognition Act 2004 – Social Security Contributions and Benefits Act 1992 ss. 6(3) and 122 and Pensions Act 1995 sched. 4 – Human Rights Act 1998, s. 3 – Directive 79/7 – Gender Recognition Act 2004
FIRST-TIER TRIBUNAL
TAX CHAMBER
M Appellant
- and -
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS Respondents
TRIBUNAL: JUDGE NICHOLAS PAINES
Sitting in public in London on 31 March 2010
Christopher Stothers, Arnold & Porter (UK) Ltd, for the Appellant
Jason Coppel, instructed by the Solicitor for HM Commissioners of Revenue and Customs, for the Respondents
© CROWN COPYRIGHT 2010
DECISION
1. The appellant asked me not to disclose her identity in the published version of this decision. I agreed not to do so, and shall refer to her simply as ‘the appellant’. The issue in this appeal is whether she was required to continue to pay national insurance contributions when, being over 60, she began to live as a woman. I have delayed issuing this decision in order to take into account the decision of the Court of Appeal in Timbrell v Secretary of State for Work and Pensions [2010] EWCA Civ 701. I have concluded that the appellant is not assisted by the Timbrell decision, in which the facts were different in an important respect, and that she was required to continue paying NICs until the issue to her of a gender recognition certificate under the Gender Recognition Act 2004. I considered inviting submissions on the effect of Timbrell, but did not do so as I am satisfied that they would not alter my view of its effect.
1. The appellant is affected by the condition known as gender dysphoria, which can be broadly described (this is not an attempt at a definition) as the conviction that one belongs to the sex opposite to that indicated by the physical characteristics of one’s body. It is different from the condition referred to as intersex, where the body has a mixture of male and female physical characteristics. Gender dysphoria is a condition that has not until comparatively recently received legal recognition in this country. When it was necessary to decide to which sex a person belonged in law, the courts applied the threefold test adumbrated by Ormrod J in Corbett v Corbett [1971] P 83. This looked only at physical characteristics: whether, leaving aside any surgical intervention, the person had physically male or female gonads, genitals and combinations of chromosomes; where the indications were congruent (i.e. all indicated the same physical sex), the person was in law of the sex indicated. The same approach was taken by the Social Security Commissioners to the question whether a person was male or female for the purposes of pensionable age in R(P) 1/80 and R(P) 2/80; and Corbett was approved by the Court of Appeal in a different context (liability for a criminal offence only capable of being committed by a man) in R v Tan [1983] QB 1053.
2. Over the years, some degree of recognition of gender dysphoria began to be given administratively as regards matters such as driving licences, passports and medical cards though not, for example, as regards birth certificates; but Corbett and Tan continued to represent the legal position for the purposes of marriage and the criminal law, and transsexual people had no legal right to recognition by the State or others of what they considered to be their true gender. At the beginning of this century Corbett was applied by a majority of the Court of Appeal in Bellinger v Bellinger [2001] EWCA Civ 1140 so as to hold that Mrs Bellinger was not ‘female’ within the meaning of section 11 of the Matrimonial Causes Act 1973. Despite some success by a transsexual person complaining about a less liberal regime in B v France (13343/87, 25 March 1992), attempts to challenge the United Kingdom’s treatment of transsexual people before the European Court of Human Rights as being contrary to articles 8 (right to respect for private life) and 12 (right to marry) of the European Convention on Human Rights were initially unsuccessful, most recently in Sheffield and Horsham v United Kingdom (22885/93 and 23390/94, 30 July 1998) where the Court noted the mixed position among Contracting States and held that the matters complained of fell within the State’s margin of appreciation, albeit that States must keep the position under review. Things changed dramatically with the Court’s subsequent decision in Goodwin v United Kingdom (28957/95), decided in July 2002.
3. In Goodwin the Court found infringements of both articles 8 and 12. In relation to article 8, it set out the considerations militating in favour of recognition of Ms Goodwin’s acquired gender: in brief summary, these were that her remaining for legal purposes male while living as a woman had unsatisfactory effects upon her private life; her legal status conflicted with an important aspect of her personal identity; her reassignment had been carried out by the National Health Service and it seemed illogical to refuse to recognise the legal implications of the result to which the treatment led; and the unsatisfactory nature of the situation had been recognised by the Court of Appeal in Bellinger. The Court then reviewed the considerations that had led it not to find an infringement of article 8 in previous cases, and found them no longer sufficiently persuasive. Under the heading ‘Striking a balance in the present case’ it concluded that the essence of the Convention was respect for human dignity and freedom and personal autonomy, holding that “in the twenty-first century the right of transsexuals to personal development and to physical and moral security in the full sense enjoyed by others in society cannot be regarded as a matter of controversy requiring the lapse of time to cast clearer light on the issues involved. In short, the unsatisfactory situation in which post-operative transsexuals live in an intermediate zone as not quite one gender or the other is no longer sustainable” (paragraph 90). In paragraph 91 it acknowledged the difficulties that any major change in the law would have in a number of fields, including social security, but these were not insuperable:
As Lord Justice Thorpe observed in the Bellinger case, any “spectral difficulties”, particularly in the field of family law, are both manageable and acceptable if confined to the case of fully achieved and post-operative transsexuals. Nor is the Court convinced by arguments that allowing the applicant to fall under the rules applicable to women, which would also change the date of eligibility for her state pension, would cause any injustice to others in the national insurance and state pension systems as alleged by the government. No concrete or substantial hardship or detriment to the public interest has indeed been demonstrated as likely to flow from any change to the status of transsexuals and, as regards other consequences, the Court considers that society may be expected to tolerate a certain inconvenience to enable individuals to live in dignity ....
4. Importantly, the Court’s conclusion at paragraph 93 was
Having regard to the above considerations, the Court finds that the respondent government can no longer claim that the matter falls within their margin of appreciation, save as regards the appropriate means of achieving recognition of the right protected under the Convention. [Emphasis added]
5. I need to refer to the reasoning under article 12, since it formed the basis of a submission of Mr Christopher Stothers on behalf of the appellant. At paragraph 99 the Court reminded itself that the right to marry was expressly made subject to the national laws of the Contracting States and that the test to be applied was whether national law impaired the very essence of the right; its conclusion in relation to article 8 did not ‘subsume all the issues under article 12’. The Court nevertheless found that the very essence of Ms Goodwin’s right to marry was impaired; it was artificial to say that she retained the right to marry a woman and she could not marry her chosen partner, a man with whom she was in a relationship. The Court was unprepared to leave the matter wholly within the State’s margin of appreciation, since British courts tended to regard it as best handled by the legislature, while the Government had no plans to legislate. It concluded
103. It may be noted from the materials submitted by Liberty that though there is widespread acceptance of the marriage of transsexuals, fewer countries permit the marriage of transsexuals in their assigned gender than recognise the change of gender itself. The Court is not persuaded however that this supports an argument for leaving the matter entirely to the Contracting States as being within their margin of appreciation. This would be tantamount to finding that the range of options open to a Contracting State included an effective bar on any exercise of the right to marry. The margin of appreciation cannot extend so far. While it is for the Contracting State to determine inter alia the conditions under which a person claiming legal recognition as a transsexual establishes that gender re-assignment has been properly effected or under which past marriages cease to be valid and the formalities applicable to future marriages (including, for example, the information to be furnished to intended spouses), the Court finds no justification for barring the transsexual from enjoying the right to marry under any circumstances.
6. Parliament responded to the Goodwin judgment by enacting the Gender Recognition Act 2004. The machinery set up by the Act involves, briefly stated, application to a Gender Recognition Panel; the Panel must grant the application if the applicant is over 18, “has lived in the acquired gender throughout the period of two years ending with the date on which the application is made” and intends to continue doing so for life, and certain evidence is provided (section 2). By section 4, upon granting an application the Panel must issue an interim or full gender recognition certificate. The effect of the issue of a full gender recognition certificate to a person is that “the person’s gender becomes for all purposes the acquired gender” (section 9(1)), but by section 9(2) the certificate does not affect things done, or events occurring, before it is issued. An interim certificate is to be issued if the person is still married; its issue makes that marriage voidable and by section 5 a court which annuls the marriage on that ground must thereupon issue a full certificate.
7. Schedule 5 to the Act deals with social security and pension entitlement where a full gender recognition certificate has been issued to a person; by paragraph 7 of that schedule, any question as to whether the person is entitled to a Category A retirement pension under section 44 of the Social Security Contributions and Benefits Act 1992 (to which, along with other relevant provisions of pensions legislation, I refer at paragraph 10 below) is to be decided as if the person’s gender had always been the acquired gender, thereby creating an exception to the rule in section 9(2). Paragraph 7(3) continues “if (immediately before the certificate is issued) the person (a) is a man who has attained the age at which a woman of the same age attains pensionable age, but (b) has not attained the age of 65, the person is to be treated for the purposes of section 44 of the 1992 Act as attaining pensionable age when it is issued”.
8. The Act came into force on 4 April 2005, but until 4 October 2005 applications under it could only be made by people who had been living in their acquired gender for 6 years or more (section 27). In the meantime, Bellinger had reached the House of Lords ([2003] UKHL 21), which found it impossible to interpret the terms ‘male’ and ‘female’ in section 11 of the 1973 Act as extending beyond biological gender and declared the section incompatible with the Convention.
9. At the time of her birth in June 1942 the appellant had the physical characteristics of a male, but from early childhood she felt herself to be female. She lived in a male role until 2004, when she began to take female hormones and, shortly afterwards, told her family of her decision to begin to live full-time as a woman. This, she told me, she did continuously from 4 June 2004 onwards; that is not admitted by HMRC. In June 2004 the Appellant reached the age of 62; she was thus already of an age at which a woman would not be required to pay national insurance contributions and would be entitled to a retirement pension. The appellant’s marriage was dissolved by a decree nisi in October 2004 and a decree absolute in November 2004. In December 2004 she changed her forenames from male to female ones by deed poll. She underwent gender reassignment surgery in December 2005. In June 2006, two years after she considered that she had begun to live as a woman, she applied to the Gender Recognition Panel for a recognition certificate. The panel took the view that the appellant had not begun fully to live as a woman until her change of name in December 2004 (something the appellant disputes, but decided not to contest before the panel, as doing so would only further delay the issue of a certificate); she applied to them again on 1 December 2006 and they issued a full certificate on 21 December.
11. There had been correspondence between the appellant and HMRC and the Department of Work and Pensions in 2005 and 2006 about her entitlement to a retirement pension. The DWP had decided in August 2006 that she was not entitled to a retirement pension. She appealed against that decision but was unsuccessful both before the Appeal Tribunal (which dismissed her appeal in May 2007) and before the Social Security Commissioners, who dismissed her further appeal in March 2008. In the meantime she had successfully claimed a pension, in reliance on her gender recognition certificate, with effect from December 2006, so the period in issue was that between June 2004 – when, the appellant argued, EU law and/or the Human Rights Act 1998 entitled her, as a transsexual person who was living as a woman, to be recognised in law as female – and December 2006. (There was also an issue, which I need not go into, about the date on which she first claimed a pension, a claim for benefit generally being a prerequisite to entitlement under social security law; the issue arose because the appellant had initially corresponded with HMRC, which failed to pass the pension claim on to the DWP. This resulted in HMRC making a payment of compensation to the appellant.)
12. The appellant’s arguments before the Social Security Commissioners were very similar to her arguments before me; Mr Jason Coppel, who appears for HMRC, invites me to agree with their decision, which is reported as decision R(P) 1/09. For the appellant, Mr Christopher Stothers says the Commissioners were wrong.
13. Correspondence continued between the appellant and HMRC about her liability for Class I contributions. Since liability ends at pensionable age, the issue was again whether EU law and/or the Human Rights Act entitled her to be regarded as a woman from June 2004 onwards. If so then, she being over 60, her liability would cease at that point. Though the underlying question to be resolved is the same as the question decided against her by the DWP and the social security Tribunal and Commissioners, HMRC are not bound to reach the same decision as the DWP. HMRC did, however, decide that the appellant did not attain pensionable age until receiving her gender recognition certificate. That decision was formally taken in February 2009 and confirmed on review in May 2009 and this appeal is against that decision.
15. It is in my judgment best to deal with the EU and ECHR position separately; I consider the Convention and the Human Rights Act first.
The European Convention on Human Rights and the Human Rights Act 1998
16. I have referred to the reasoning in Goodwin above. On behalf of HMRC Mr Jason Coppel also relied on Grant v United Kingdom (32570/03, 23 May 2006). That case concerned a woman born biologically male in 1937 who had had gender reassignment surgery and presented as a woman since 1963. On reaching 60 in 1997 she had unsuccessfully claimed a retirement pension, which was only paid to her once she reached 65 in December 2002. In a judgment given after the coming into force of the Gender Recognition Act, the Human Rights Court held that Ms Grant was a victim of a breach of her article 8 rights from the time the Goodwin judgment was given in 2002 - but not earlier: see paragraph 42 - until the Gender Recognition Act came into force: see paragraph 41. Mr Coppel relied on this as recognition that the passing of the Act had brought an end to the infringements of the Convention. Mr Coppel also relied on Parry v United Kingdom (42971/05, 28 November 2006). In that case the applicants were married but the husband was affected by gender dysphoria; they complained of a violation of their article 8 and 12 rights in that the husband could not obtain a full gender recognition certificate in the female gender without the couple divorcing, which neither of them wished to do. Finding the application manifestly unfounded, the Court noted that the United Kingdom had introduced the Gender Recognition Act and held that stipulating that two people could not at the same time be legally of the same sex and be married was a matter which “falls within the appreciation of the Contracting State”.
17. Finally as regards the relevant case-law of the Court of Human Rights, Mr Stothers relied on Schlumpf v Switzerland (29002/06, 8 January 2009). In that case the applicant had delayed undergoing gender reassignment surgery until her children were adult and her wife had died. The applicant was herself aged 67 when a clinic confirmed that she was suitable for immediate reassignment surgery. She applied to her medical insurance company for funding, which was refused in reliance on a decision of the Federal Insurance Court that there should be a two-year observation period before funding of gender reassignment surgery was authorised. An initial appeal to an insurance court was successful, the court holding that the two year period was not a sine qua non, but the Federal Insurance Court allowed the insurer’s appeal, holding that the lower court had not shown sufficient reasons for departing from the Federal Court’s precedents. The Human Rights Court noted that legal recognition of the applicant’s change of gender was not in issue, as that had already been recognised. In addition to finding breaches of article 6 in the way the proceedings were conducted, it held in relation to the funding of the surgery that an over-rigid application of the two year observation requirement could be contrary to article 8. The Federal Court had refused to analyse the circumstances and weigh up the competing interests at stake; it should have taken account of the opinions of the medical specialists in order to examine whether an exception was appropriate, particularly owing to the applicant’s relatively advanced age. In view of her special situation and the narrow margin of appreciation available to the State, no fair balance had been struck between her interests and those of the insurance company.
18. Mr Stothers’s submission was that the Gender Recognition Act did give not adequate effect to the Convention rights of transsexual people for the reasons I have summarised in paragraph 14 above. He drew attention to the summary of the facts in paragraphs 13-17 of the Goodwin judgment, including the fact that Ms Goodwin had undergone reassignment surgery, to the Court’s citation at paragraph 53 of parts of Thorpe LJ’s dissenting judgment in the Court of Appeal in Bellinger, to the Court’s own reasoning at paragraph 82 that the chromosomal element of biological gender should not prevail in the days of increasingly sophisticated surgery and to its repetition at paragraph 100 that “a test of congruent biological factors can no longer be decisive in denying legal recognition to the change of gender of a post-operative transsexual”. He submitted that article 8 as interpreted in Goodwin required recognition of the acquired gender of a post-operative transsexual person. The Act did not give effect to that obligation, but imposed the two year rule instead. He submitted that Grant confirmed Goodwin and did not mean that the United Kingdom was no longer in breach of article 8 after the passing of the Act. He relied on Schlumpf as indicating that an immutable two-year waiting requirement was disproportionate. He did not accept that Parry permitted a rule for all article 8 purposes that change of gender could not be recognised prior to the dissolution of a previous marriage; he suggested that the Court had rejected the parties’ complaint that they could not remain married after the husband’s gender reassignment on the basis that the institution of civil partnership was available to them. Mr Stothers submitted that paragraph 103 of the judgment recognised the particular sensitivity of issues relating to marriage and accorded the Contracting State a wider margin of appreciation under article 12 than article 8; this explained the decision in Parry.
19. Mr Stothers submitted that, while failing to give proper effect to article 8 rights, the Gender Recognition Act was not the only route by which those rights could be given effect to; the Tribunal had the power and duty under section 3 of the Human Rights Act to interpret the pensionable age provisions in the legislation compatibly with those rights. It was fundamental to Mr Stothers’s submissions that the requirements of the Convention differed according to the subject-matter: the State had a wider margin of discretion as regards recognising gender reassignment for the purposes of marriage than for other purposes. In particular, it followed that the House of Lords’ refusal in Bellinger to apply a section 3 interpretation to the Matrimonial Causes Act did not preclude such an interpretation of the state pension legislation.
20. Mr Coppel submitted that the appellant’s case was covered by the Gender Recognition Act, since the Act was in force by the time she completed two years of living as a woman; the Act did not prohibit taking into account a period before the Act came into force. Accordingly there was no ‘legislative vacuum’ to be filled by a section 3 interpretation of the pension legislation. Moreover, paragraph 7(3) of schedule 5 to the Act left no room for a statutory interpretation that held the appellant to be a woman before her receipt of her recognition certificate. The Human Rights Act did not therefore get the appellant anywhere. She could only succeed if she could show that the Gender Recognition Act was contrary to EU law. He further submitted that paragraph 41 of Grant showed that the 2004 Act satisfied the Convention rights of transsexual people: it supplied the “means on a domestic level to obtain ... recognition” which is all the Human Rights Court required. He disputed that the margin of appreciation was different as between articles 8 and 12, drawing attention to paragraph 93 of Goodwin.
21. Since all the legislative provisions at issue are in primary legislation, it is sensible to start with the question whether it is open to me, by virtue of section 3 of the Human Rights Act, to construe the legislation in the way that Mr Stothers invites me to do. If not, I do not have power to make a declaration of its incompatibility with the Convention even if I considered the legislation to be incompatible.
22. I agree with Mr Coppel that, as the statute book currently stands, it is impossible to interpret the term ‘woman’ in schedule 4 to the Pensions Act as including a biologically male person to whom a gender recognition certificate has not been issued. The use of the word ‘becomes’ in section 9 of the Gender Recognition Act makes it clear that, prior to the issue of a full certificate, a person’s sex for legal purposes is their biological sex (and remains so unless and until a full certificate is obtained), and paragraph 7(3) of schedule 5 to that Act reinforces the position as regards the attainment of pensionable age by a person in the appellant’s position. I do not consider it possible as a matter of statutory interpretation for the terms ‘man’ and ‘woman’ simultaneously to have different meanings in different Acts of Parliament; at all events, I do not consider it possible for those terms to have, in the case of a transsexual person, different meanings in an Act specifically enacted to legislate for the legal gender of transsexual people and in another Act. The appellant could only be a woman within the meaning of the Pensions Act in the period between the enactment of the Gender Recognition Act and the issue of her certificate if in that period she was also a woman – and therefore not a man - within the meaning of paragraph 7(3)(a) of schedule 5. The legislative intention that she should be regarded as man within the meaning of paragraph 7(3)(a) is so obvious that any other interpretation is impossible.
23. However, the appellant is claiming a Convention Right over a period starting in June 2004, just before the Act was passed and some months before it came into force. I do therefore need to consider how the legal position stood then. But as regards that period also I consider that Bellinger constrains me to hold it not ‘possible’ within the meaning of section 3 of the Human Rights Act to construe the term ‘woman’ in schedule 4 to the Pensions Act as including the appellant. In Bellinger the House of Lords had to consider whether it was possible under section 3 to construe the term ‘female’ in the Matrimonial Causes Act as including Mrs Bellinger since, if it was, the House could not make a declaration of incompatibility under section 4. Though the sensitivity of issues relating to marriage was emphasised in the speeches, the reasoning is not confined to marriage but evidences judicial hostility to the proposition that the terms ‘male’ and ‘female’ in a piece of legislation can have “a novel, extended meaning: that a person may be born with one sex but later become, or become regarded as, a person of the opposite sex” (per Lord Nicholls at paragraph 36; see also the surrounding paragraphs under the heading ‘Gender and Marriage: part of a wider problem’, and in particular paragraph 45). Both Lord Hope and Lord Hobhouse noted that section 3 does not confer a power to legislate by making (as Lord Hobhouse put it) ‘a legislative choice as to what precise amendment was appropriate’: see paragraphs 67 and 78. That is precisely what Mr Stothers’s submission invites me to do, in deciding (for example) that the appellant’s living as a woman, alternatively her undergoing reassignment surgery, is a sufficient criterion and that the subsistence of her marriage is not a disqualifying factor.
24. I should add that Mr Stothers also relied on A v Chief Constable of W Yorkshire [2004] UKHL 21. He correctly relied on it in support of his EU law rather than his ECHR case, but it is appropriate to deal with it now. In that case, the Chief Constable had, in 1998, rejected A’s application to become a police constable; A was male under the Corbett criteria but lived and presented as a woman. The Chief Constable rejected the application because he took the view that, being in law male, A could not lawfully search female arrested persons because of section 54(9) of the Police and Criminal Evidence Act 1984, which provides “The constable carrying out a search shall be of the same sex as the person searched”, and that it would not be appropriate for A, presenting as a woman, to search men. The House of Lords held that this was contrary to Directive 76/207 (the Equal Treatment Directive) as interpreted in by the ECJ in Case C-13/94 P v S [1996] ECR I-2143, though not at that time contrary to the Human Rights Convention, since Goodwin was not retrospective. Mr Stothers relied on Lord Bingham’s statement at paragraph 12 that
effect can be given to the clear thrust of Community law only by reading “the same sex” in section 54(9) of the 1984 Act ... as referring to the acquired gender of a post-operative transsexual who is visually and for all practical purposes indistinguishable from non-transsexual members of that gender. No one of that gender searched by such a person could reasonably object to the search.
Lord Bingham went on to distinguish Bellinger v Bellinger on the grounds that
the case concerned marriage, perhaps the most important and sensitive of human relationships. It lacked any Community dimension so that P v S was not cited and there was no need to consider it. And the House exercised its power under section of the Human Rights Act 1998 to declare that section 11(c) of the Matrimonial Causes Act was incompatible with article 8 and 12 of the European Convention in failing to make provision for the recognition of gender reassignment.
25. In a passage relied on by Mr Stothers, Baroness Hale said (at paragraph 52 of her speech) that “the House in Bellinger was concerned only with capacity to marry and in particular with the meaning of the words ‘respectively male and female’ in section 11(c) of the Matrimonial causes Act 1973. These presupposed two clearly distinguished genders. It is less clear why the immutability of birth gender for marriage purposes should apply for all other purposes.” I note that she began her discussion of the issues (paragraph 50) by saying that the case turned on the Equal Treatment Directive rather than Goodwin or domestic law. At paragraph 53 she described Goodwin as holding that “the refusal of domestic law to recognise the reassigned gender “no longer falls within the United Kingdom’s margin of appreciation. But it would be for the United Kingdom to decide how to fulfil its obligation to secure to trans people their right to respect for private life and their right to marry.” In a passage relied on by Mr Coppel she said (emphasis added)
60. Until the matter is resolved by legislation, there will of course be questions of demarcation and definition. Some of these, for the reasons explained in Bellinger, will be sensitive and difficult. That is presumably why the Court of Justice in [Case C-117/01 KB [2004] ECR I-541] acknowledged the role of the national court in deciding whether the principle did in fact apply in the particular case. One can well envisage a person who claims to have gender dysphoria but who has not successfully achieved the transition to the acquired gender. (One could also envisage a relationship which was not as close to marriage as the relationship in that case.) The Gender Recognition Bill provides a definition and a mechanism for resolving these demarcation questions. But until then it would be for the Employment Tribunals to make that judgment in a borderline case.
Lady Hale continued
61. In this case, however, Ms A has done everything that she possibly could do to align her physical identity with her psychological identity. She has lived successfully as a woman for many years. She has taken the appropriate hormone treatment and concluded a programme of surgery. She believes that she presents as a woman in every respect.
.....
63. In my view Community law required in 1998 that such a person be recognised in her reassigned gender for the purposes covered by the Equal Treatment Directive This conclusion does not depend upon Goodwin and this case can readily be distinguished from Bellinger. I would dismiss this appeal.
26. While Lord Bingham saw the solution as lying in the interpretation of section 54(9), he noted that the case was one concerning EU law rights rather than Convention rights. Lady Hale did seem to suggest at paragraph 52 that the words ‘male’, ‘female’ and ‘sex’ might be interpreted differently in different pieces of legislation, but she was not specifically discussing section 3 of the Human Rights Act (whose relevance she had rejected at paragraph 50) and viewed the case as a matter of giving effect to EU law rights. It is evident that since the Chief Constable was an ‘emanation of the State’ the Directive was directly effective against him, whether or not its requirements could be satisfied by what is sometimes called a ‘conforming interpretation’ of the relevant domestic legislation. The enforcement of directly effective EU law rights is not subject to any requirement that it be possible (in the section 3 sense) to do so by way of statutory interpretation; I therefore do not regard West Yorkshire as departing from Bellinger as regards the scope of ‘conforming interpretation’ under section 3.
27. I in any event consider that the decision in Timbrell constrains me to hold it not to be possible, either before or after the enactment of the Gender Recognition Act, to interpret the pension legislation in the manner contended for by Mr Stothers. Ms Timbrell was born biologically male but underwent gender reassignment surgery, at the age of 59, in October 2000. She subsequently claimed a Category A pension with effect from 17 July 2001, her 60th birthday. Proceeding on a concession - see paragraph 17 of the judgment - Aikens LJ (with whose judgment the other members of the Court agreed) held that Bellinger required the terms ‘man’ and ‘woman’ in the pension legislation to be interpreted in accordance with biological gender. (Ms Timbrell nevertheless succeeded in her appeal on the basis of her directly effective rights under Directive 79/7. I deal with this below.)
28. It follows from the view I have formed about the extent of my powers that I could not avoid holding that the appellant was a man within the meaning of schedule 4 to the Pensions Act at all times prior to the issue of her gender recognition certificate, even if I considered that that result was contrary to the Convention. My views on the issue of compatibility do not therefore matter. A higher court is in as good a position as I am to decide that question: the threshold question of whether there are any justiciable limits to the State’s margin of appreciation recognised in paragraph 93 of Goodwin is a pure question of law and, even if there are such limits, I heard no evidence on the justification or otherwise of the particular criteria adopted in the 2004 Act. I think it better for me not to express a view beyond saying that, in respectful accordance with Baroness Hale’s view of the scope of the Goodwin judgment at paragraph 53 of West Yorkshire, I do not consider that the Human Rights Court intended the adequacy of a State’s criteria for recognising gender to be a justiciable matter, unless perhaps the criteria were so deficient as not to amount to an honest attempt to devise appropriate criteria. I would in any event have felt obliged by the decision in Parry to hold that it was not contrary to the Convention to deny recognition of the appellant’s female gender during the subsistence of her previous marriage, and I doubt that the Convention could absolutely require recognition by virtue of a person having undergone reassignment surgery; that would amount to an obligation to delegate the decision on legal gender to the medical profession. I also doubt that Schlumpf prohibits the two year rule in the 2004 Act; the context was different, in particular in that the case was about an individual decision of a court rather than the setting of a legislative criterion. I would not have been attracted by the argument that a person should be recognised in law as simultaneously being of different sexes for different purposes, nor by the suggestion that recognition should be retrospective in such a way as to undermine things done prior to recognition.
29. Mr Coppel relied on the decision of a Tribunal (as it was then called) of three Social Security Commissioners in the appellant’s unsuccessful appeal to it, reported as R(P) 1/09, while Mr Stothers criticised their reasoning, particularly their approval of the two year rule at paragraph 41 of their decision. My decision on the scope of my powers under section 3 makes it unnecessary for me to decide whether to follow the Commissioners’ decision as regards the compatibility of the 2004 Act with the Convention. I was shown the decision of a three judge panel of the Administrative Appeals Chamber of the Upper Tribunal (which the Commissioners have become) in Dorset Healthcare v MH [2009] UKUT 4 (AAC); paragraph 37(1) of that decision indicates that decisions of the Administrative Appeals Chamber are binding on Chambers of the First-tier Tribunal from which appeals lie to that Chamber, but does not rule on whether they are binding on other First-tier Chambers. However, it also makes the point that (as was the position in the days of the Social Security Commissioners) single judges of the Upper Tribunal are required to follow decisions of three judge panels of the AAC in the absence of compelling reasons to the contrary, and normally follow the decisions of other single judges “in the interests of comity and to avoid confusion on questions of legal principle”, though not to the extent of perpetuating error. It seems to me that it is equally if not more desirable that judges of the Tax Chamber of the First-tier Tribunal should normally follow relevant decisions of the Social Security Commissioners (and the same goes for the AAC if, which it is unnecessary to decide, its decisions are not binding on all Chambers of the First-tier Tribunal); if I had found it necessary to reach a decision on the compatibility of the 2004 Act with the Convention I would have been very slow to depart from the conclusion reached in R(P) 1/09; the issues in this case and that are virtually identical and the appropriate forum in which to express disagreement with the decision is the Court of Appeal.
EU law
30. Mr Stothers’s EU law case is based on the ECJ judgment in Case C-423/04 Richards v Secretary of State for Work and Pensions [2006] ECR I-3585. Like Ms Richards, the appellant claims a directly effective right under Directive 79/7 on equal treatment in social security matters. My duty to give effect to the Directive is not limited to adopting a ‘conforming’ interpretation of the domestic legislation if possible; I must give effect to the appellant’s rights. Richards was decided by the ECJ in April 2006, after the Gender Recognition Act was enacted; it concerned a person, born in the same year as the appellant and recorded at birth as male, who had undergone gender reassignment surgery in 2001 and claimed a retirement pension at the age of 60 in 2002. The claim was rejected and, following appeals to the Appeal Tribunal and the Social Security Commissioner, questions about whether Directive 79/7 entitled her to a pension on the same terms as any other woman were referred to the ECJ by the Commissioner in September 2004. Building on its case-law in P v S and KB, the ECJ held that Directive 79/7 did entitle her to a pension on the same terms as any woman, but there was controversy before me as to whether that right was conditional on her satisfying the conditions of the Gender Recognition Act, which had come into force in the meantime. Mr Stothers drew my attention to the passage in the Opinion of Mr Advocate General Jacobs where he said “I would add that the question of the stage at which a transsexual person becomes entitled to equal treatment within the meaning of Directive 79/7 with persons of his or her acquired gender was debated at the hearing. There is however no need to resolve that issue in the present case, which concerns a post-operative transsexual person whose entitlement is therefore clear”.
31. Mr Coppel submitted that the Court had not followed that aspect of the Advocate General’s Opinion. He pointed out that the section of the Court’s judgment dealing with national law referred to sections 2 and 9 of the Gender Recognition Act and paragraph 7 of schedule 5 to the Act; that paragraph 21 of the judgment reasoned that
21 First of all, it should be noted that it is for the Member States to determine the conditions under which legal recognition is given to the change of gender of a person (see to that effect K.B., paragraph 35).
and that the Court concluded
38 It is clear from the foregoing that Article 4(1) of Directive 79/7 must be interpreted as precluding legislation which denies a person who, in accordance with the conditions laid down by national law, has undergone male-to-female gender reassignment entitlement to a retirement pension on the ground that she has not reached the age of 65, when she would have been entitled to such a pension at the age of 60 had she been held to be a woman as a matter of national law.
22 Read with paragraph 21, Mr Coppel submitted, this was a reference to national law on legal recognition of change of gender, so that that the judgment meant that the right under the Directive only came into being once a claimant met the conditions of (in this country) the Gender Reassignment Act. It was unnecessary in this case to decide the position of people who would have satisfied those conditions earlier if the Act had been in force earlier, since this was not such a case.
23 Mr Stothers disagreed. He pointed out that, following the ruling, the Commissioner had awarded Ms Richards a pension with effect from her 60th birthday (his decision records that this was by consent). Mr Stothers accepted that EU law gave Member States a margin of discretion in recognising changes of gender, but submitted that, as regards pension entitlement, EU law required the gender of a post-operative person to be recognised and did not permit the two year rule nor a rule precluding recognition during the subsistence of a previous marriage. EU law therefore required the appellant’s female gender to be recognised from the point at which she started living as a woman (June 2004), without waiting two years or requiring her previous marriage to be dissolved, or at least from her surgery in December 2005. Mr Stothers submitted that what the Court said in paragraph 21 of Richards was qualified by the passages to which that paragraph cross-refers. First, in paragraph 35 of KB, to which paragraph 21 refers, the Court had said
35. Since it is for the Member States to determine the conditions under which legal recognition is given to the change of gender of a person in R.'s situation - as the European Court of Human Rights has accepted (Goodwin v United Kingdom, § 103) - it is for the national court to determine whether in a case such as that in the main proceedings a person in K.B.'s situation can rely on Article 141 EC in order to gain recognition of her right to nominate her partner as the beneficiary of a survivor's pension.
24 Mr Stothers then took me to paragraph 103 of Goodwin, which I have set out above. He submitted that the Human Rights Court in Goodwin was expressly speaking of the State’s right to determine the conditions under which transsexual people may marry and that, in referring to that passage, the ECJ in KB – which was a case about a transsexual person’s entitlement to a widower’s pension, and thus also about the right to marry – was also dealing with the margin of discretion available in determining the scope of the right to marry. Contrasting the House of Lords’ refusal in Bellinger v Bellinger to construe the words ‘male’ and ‘female’ in the Matrimonial Causes Act 1973 as including acquired gender with the House’s preparedness in West Yorkshire to interpret the word ‘sex’ in section 54 of the Police and Criminal Evidence Act as including acquired gender, he submitted that the recognition of gender for the purpose of marriage was a more sensitive matter than doing so for the purpose of pension entitlement, so that the margin of discretion was narrower. He attacked the two year rule as being disproportionate in the case of pension entitlement: if a waiting period was necessary at all, entitlement should be retrospective once its expiry showed the change of gender to be definitive, and to insist on waiting two years although reassignment surgery had taken place in the meantime was disproportionate.
25 The meaning of paragraph 38 of Richards has now been decided by the Court of Appeal in Timbrell. Aikens LJ held
41 It seems to me that the critical question is whether Directive 79/7 , in particular Article 4 , applies to a situation where, as was the case prior to the GRA, English law and legislation had no means at all of giving legal recognition to a change of gender of a person who had successfully undergone gender re-assignment for the purposes of seeing whether that person has reached retirement age for the purposes of obtaining a retirement pension. Was the UK bound to ensure that, with regard to those who had acquired a different gender, there would be no discrimination whatsoever, either direct or indirect, on the ground of sex, with regard either to the scope of the Category A pension scheme or the conditions of access to that scheme?
42 I think that the wording of [38] in the ECJ's decision in Richards provides a clear and definitive answer. Paragraph [38] states in terms that Article 4(1) of Directive 79/7 is to be interpreted as precluding legislation which denies a person who has (legally) undergone gender re-assignment surgery from entitlement to a retirement pension because she has not reached the age of 65, when that person (who had become a woman by the gender re-assignment surgery) would have been entitled to that pension at the aged of 60 had she been held to be a woman as a matter of national law. In short, as I read [38] in Richards , Article 4(1) precludes (on the grounds that it is either directly or indirectly discriminatory) a situation where there is no legislative or other legal means to give recognition to a person's acquired gender. The decision also established that the exceptions laid down in Article 7(1) did not apply because the issue in the case was not the fact that the UK legislation provided for different pensionable ages for men and women, but that the UK legislation did not deal with the situation where a person had acquired a different gender and wished to exercise legal rights according to that acquired gender.
43 Mr Johnson [counsel for the Secretary of State] is correct in arguing that the decision in Richards does not indicate what kind of national legislation should be in place or what sort of conditions ought to be satisfied for the recognition of an acquired gender by means of gender re-assignment. That is because, as [31] of Richards recognised, that is a matter for national law, not for the ECJ to determine. But that cannot alter the fact that Richards effectively held that a total lack of any kind of legislative or legal framework in UK law to enable acquired gender to be recognised so as to enable a person who has acquired a new gender to exercise the rights to obtain a retirement pension according to existing legislation constituted discrimination within Article 4(1) of Directive 79/7.
He went on to hold that in consequence, Ms Timbrell could invoke her directly effective rights under Directive 79/7 and the Secretary of State could not rely on the terms of the legislation or the decision of the House of Lords in Bellinger in order to withhold payment of pension from her 60th birthday.
42 If the appellant’s gender reassignment surgery had been performed before the Gender Recognition Act came into force, rather than in December 2005, Timbrell would have obliged me to hold that she too had a right to cease paying NICs once the surgery had been performed and that subsequently enacted criteria such as the two year rule and the requirement for dissolution of any previous marriage could not be invoked against her. Applying Directive 79/7 is shown by Timbrell not to be a matter of reviewing national criteria by reference to a margin of discretion. Prior to their enactment, national criteria are irrelevant: the right under the Directive derives from undergoing reassignment surgery and is not defeated by non-satisfaction of subsequently enacted national conditions. Secondly, paragraph 43 requires me to hold (consistently with Baroness Hale’s view of the ECHR position) that the terms of the recognition legislation, once enacted, are not subject to review under the Directive: the description of them as ‘a matter of national law, not for the ECJ to determine’ must mean that, just as there are no EU law criteria by which the ECJ will judge the national rules, there are no EU law criteria by which national courts or tribunals can do so either. It seems to me to leave no scope, once the Act is in force, for a holding that its criteria are inadequate to satisfy the Directive – unless perhaps they were so deficient as not to amount to an honest attempt to comply with the Directive, which has not been suggested. It therefore follows that the fact that the two year rule delayed legal recognition of the appellant’s gender until December 2006 cannot be contrary to the Directive. The only remaining issue is whether the Directive could, in the absence of national recognition criteria, create a right to equal treatment from the point at which the appellant started living as a woman. As to that, the terms of the reasoning in Timbrell are so clear that (in the absence of national criteria) the right derives from undergoing surgery as to make it impossible for me to hold that the right could arise at an earlier point in time. I therefore do not need to decide at what point in time the appellant started to live as a woman (though I have no reason to doubt her account; I think HMRC’s refusal to accept that this was in June 2004 was based on the continued subsistence of her marriage and not executing a deed poll until later, rather than any dispute about the veracity of what she told me).
43 I have set out my reasoning at some length given that my decision is adverse to the appellant, whose understandable strength of feeling on the issue I acknowledge. She feels strongly that, having lived as a woman since June 2004, she ought to be so recognised in law with effect from then. However, in an imperfect world, what may now be clear with six years’ hindsight cannot be established at once and there is an obvious need for certainty as to what a person’s gender for legal purposes is at any time; this leaves no alternative to the use of the Corbett criteria until criteria for recognition of the other gender are satisfied.
44 This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice.
NICHOLAS PAINES
TRIBUNAL JUDGE
RELEASE DATE: 30 July 2010