R (on the application of Hodkin) v Church of Scientology: religion, religous premises and the law once more

UPDATE: The Supreme Court has given permission to appeal in this decision.  The hearing will take place on 18 July 2013.

Readers of this blog will know that I have long advocated a separation of church and state. Broadly speaking, there are three main justifications. First, the state should be neutral as between competing world views. There is no way of deciding which religion if any is the correct one, and therefore the state should not even try.

Secondly, everyone is entitled to their own beliefs or lack of beliefs. Accordingly, the fact that one chooses to follow a particular religion or no religion should not be a ground for discrimination against oneself – be it positive or negative discrimination.

Thirdly, everyone is entitled to respect for the right to hold their beliefs – but not to those beliefs themselves. Therefore, I can claim that my beliefs (spiritual, religious, whatever) require me to lead lifestyle x, but I have no claim on the state to fund that lifestyle, rendering it hard cheese if I cannot afford it.

Sadly, at present the United Kingdom does not have a separation of church and state, and therefore regularly infringes all of those principles. A good recent example is the case of R (on the application of Lousia Hodkin) v Registrar General of Births, Deaths and Marriages [2012] EWHC 3635 (Admin).

The facts

The claimant was a Scientologist who wished to marry her fiancé, another Scientologist, at a chapel of the Church of Scientology in London. The chapel was not registered under s 2 of the Places of Worship Registration Act 1855 as a “place of meeting for religious worship”. Accordingly it was not a registered building under s 26 of the Marriage Act 1949. Unless it could be registered under s 2 of the earlier Act, no application could be made under the later Act and the marriage would have to take place elsewhere.

The defendant registrar held that she was bound to find that a scientology chapel was not a “place of meeting for religious worship” within the meaning of the 1855 Act, following the decision of the Court of Appeal in R v Registrar General ex p Segerdal [1970] 2 QB 697 (Segerdal).

The claim

The claimant applied for judicial review. Of course the decision in Segerdal was, on its face, also binding on the High Court. She argued that the court was nevertheless entitled to depart from the earlier decision, because Scientology’s beliefs and services had evolved since 1970 to the extent that the reasoning of the Court of Appeal in Segerdal was no longer applicable. She adduced much evidence about Scientology’s practices and beliefs in support.

The decision

The claim failed on two bases. First, whether or not Scientology was a “religion” (something left open though doubted in Segerdal), its services did not involve “acts of worship”. The judge found it “difficult to see [Scientology] as a theistic religion”. He found that there had been no significant change in the beliefs of Scientologists and their services since 1970 and therefore it was not open to him or the registrar to depart from Segerdal.

Comment

Not for the first time, the High Court has had to undertake an exercise to which it is manifestly unsuited and which no-one on any side of the equation would wish it to undertake. The UK Human Rights Blog has a good post summarising the decision here. I have added in the comments section the point that there is something inherently wrong with judges having to sift through evidence and decide whether something is or is not a “religion” and I cannot imagine either religious or secular people being happy with it.

Ouseley J referred to the decision of the High Court of Australia in Church of the New Faith v Commissioner of Pay-Roll Tax (Victoria) (1983) 154 CLR 120 which had to decide whether or not Scientology was a religion for payroll tax purposes. The House of Lords had to do something similar with the Mormon Church in Gallagher (Valuation Officer) v Church of Jesus Christ of Latter-Day Saints [2008] 4 All ER 640, where the issue was whether or not a temple was “a place of public worship” and therefore exempt from commercial rates under the Local Government Finance Act 1988.

The tax cases can be dealt with shortly. The rule of law is hopelessly compromised in the United Kingdom by the endless series of tax exemptions, and exemptions to exemptions, that have all kinds of negative consequences. These include (but are not limited to) opportunities for loopholes for the wealthy (who are the only ones able to afford the advice to exploit them); a drain on the public finances caused by the avoided tax and the endless litigation about who or what falls within a particular class; and manifestly unfair results since some intended exemptions will fail on a technicality but unintended claims for exemptions will succeed. I wrote about this in chapter 28 of my book.

Those are all points of general application, but there is no need even to reach that far when it comes to religious organisations and their premises. If a religion is doing charitable work then it is the charitable aspect, not the religious aspect, which should qualify for tax exemption. The overarching principle is the third stated above: everyone is entitled to their own beliefs, but they are not entitled to be able to avoid taxes or otherwise ask anyone else to fund those beliefs.

The same overarching principles apply in the case of marriage. The state should not be regulating religious marriage. Instead my proposed solution, as I have written about before, is for the state to run marriages along French lines. It should set out a list of criteria (age, competence and so on) and a prescribed fee. Anyone meeting those criteria could then apply and be granted a legal marriage certificate. No ceremony would be involved; it would be along the lines of a driving licence. Then everyone would be free to have any ceremony they wanted on any premises that would have them. No religious person would consider the state’s certificate to be anything other than a formality: instead, they would consider the blessing of their church to be the only point of significance. This would free religious groups to do as they wished since they would only be performing private activities according to private contracts. Anti-discrimination laws would never enter the equation for religious groups since the laws would only apply to the state issuing its marriage certificates, not any subsequent private ceremony.

Such a solution, it seems to me, would answer any religiously-based objection to gay marriage, as well as ending the sort of dispute brought by Miss Hodkin. Instead of the courts poring over arcane texts to try and decide whether they constitute a “religion”, Miss Hodkin and her fiancé would be able to obtain a certificate from the state and then hold, just like everyone else, a “marriage ceremony” in the building of their choosing.

Parker's Pen

Latest letter in the Times (17 December 2012): 

Dear Sir,


Tony Phillips (letter, 14 December) decries the influence of Robert Parker on the fortunes of wine makers, pointing out that he only provides the opinion of one man (it is in fact often two, since Parker's former assistant, Pierre-Antoine Rovani, has written a number of important entries in Parker's guide books).

Ironically, Parker himself downplays the rise of "Parkerization" amongst vineyards trying to create wine to suit him as opposed to anyone else. In terms of tasting he stresses that "there can never be any substitute for your own palate nor any better education than tasting the wine yourself".

As one who is happy to do so Parkerization suits me well: having found my tastes differ from his, I find a lot of excellent wine is much cheaper than it might otherwise be.

 

Crank calls and causation: the Australian DJ debacle

Headlines continue to be generated about the death of the nurse at the hospital where the Duchess of Cambridge stayed recently.  Inevitably, some have suggested legal sanctions should be imposed upon  the radio station responsible and some have even gone as far as to call for criminal proceedings.  As regrettable and in poor taste as the whole episode might have been, calls for the law to be involved are misplaced.

To recap the facts shortly, the two DJs phoned the hospital and posed as members of the Royal family.  They asked for information on the Duchess and were put through by the nurse on switchboard to the ward, where they were given a short rundown on her progress.  They broadcast the details on their show which was quickly replayed around the world and advertised on their twitter account. 

The DJs were stunned that they managed to get as far as they did, mostly because by their own admission their accents were a hopeless imitation.  Perhaps this was because the woman who answered the call initially was not actually British or Australian, but rather had been raised in India. She would therefore have been less able to spot imitation accents and perhaps was also not so well versed on a rather lame form of Anglo-Saxon humour.  

Pausing there, my first observation is that the hospital was at fault for not having some protocol in place to protect their high profile patients. 

Secondly, and contrary to some Australian media reaction I read soon after the event, no objection to the call was based on anyone being precious about the Royal family as such.  Anyone who has lived in Britain for any length of time would know that ribbing Royals is a long tradition in this country.  They are sent up, scorned and sometimes outright abused in any number of newspapers and other publications here on a regular basis. 

Rather, the objection was that a patient's private medical information was broadcast without the patient's consent.  The objection would have been identical whomever it concerned.  The fact that the information was fairly bland is not the point.  For that reason, the DJs' actions were unethical.  In Britain the Duchess might have had an actionable case based on the tort of breach of privacy, had she been bothered to sue (which I suspect is unlikely).  As I have written on many occasions, however, in the internet age the right to privacy is at the mercy of any international audience which obtains the information - Australia is, needless to say, not within the jurisdiction of the British courts, though information broadcast there can easily be obtained here. 

The whole event would have swiftly disappeared from the headlines but for the tragic outcome of the nurse committing suicide in the aftermath.  Here the concept of causation comes into play.  It may be true that the suicide followed the actions of the DJs and would not have happened without them.  But that does not make them responsible.  It would have to be a reasonably foreseeable consequence of their actions - and the simple fact is that it was not reasonably foreseeable.  It was a wholly exceptional result.  There is always a natural urge to blame someone when a tragic event occurs.  But sometimes blame cannot be found - or certainly not found in sufficient measure from criminal liability to follow. And that is indisputably the case here.  

Vance v Judas Priest, or (Not) Breaking the Law

Published in the New Law Journal, Vol 161, 15 July 2011, p 994 and in my book Cases, Causes and Controversies: fifty tales from the law. I reproduce the piece by way of tribute to World Heavy Metal Day (today, according to Radio 2)

Much of my youth was mis-spent listening to heavy metal bands from the 1970s and 80s. Since then I have found it amusing watching the genre go from being called a prime factor behind the decline of Western Civilisation to its saviour.

The redemption has come from a realisation that the bands, or the better ones at least, were actually proper musicians who played according to traditional methods, as opposed to manufactured pop or the sort of unmusical noise which finds favour amongst my teenage neighbours. And yet it was once a common contention that all the imagery around swords, sorcery, devils and the undead one finds throughout the metal canon constituted unmitigated evil, or at the very least was not suitable for children.

In 1990 that argument reached its zenith – or nadir – when the veteran British band Judas Priest were sued in the United States by the parents of one James Vance. The action followed an attempted double suicide by Vance and his friend Raymond Belknap. Belknap died but Vance survived with serious injuries (though he died three years later). Both had consumed marijuana and alcohol immediately prior to the incident, and had generally led troubled lives for many years. Despite that history Vance’s parents formed the view that the suicide attempt had resulted from the pair listening to the Priest album Stained Class. They issued proceedings against the band seeking damages accordingly.

The first hurdle that the plaintiffs faced was the robust protection of freedom of expression provided in the US by the First Amendment to the Constitution. The strategy they adopted was to argue that there had been “subliminal messages” on the album, which should not qualify for First Amendment protection because the recipient would be unaware of them: there would be no exchange of information or other functioning of the marketplace of ideas, nor expression of personal autonomy, nor any of the other principles of free speech as understood in American jurisprudence. At a preliminary hearing, that argument was accepted - not without some controversy - and the case proceeded to trial.

The plaintiffs’ burden remained formidable nevertheless. They had to establish that the band had deliberately placed a message on the record, which was inaudible (but still identifiable) and thus “subliminal”, and that the message had a direct, causative link to the suicide attempts.

The band members, who can be forgiven for not taking the writ entirely seriously initially, attended trial in a solemn manner, with their usual S&M-looking garb replaced by sober suits, offset slightly by the expansive hairstyles common to all metal bands of the time. They denied that any subliminal messages had been placed on the album. It was pointed out that any number of apparent phrases could be “heard” by playing the record – or any other record – backwards, and that most such “phrases” were as innocent as they were nonsensical.

The particular message alleged to be present by the plaintiffs was “do it”, which immediately raised the unanswered question “do what?” The band remarked that if they had been going to insert any such message, it would have been along the lines of “buy seven copies of this album” and not a commercially-detrimental injunction for fans to kill themselves.

The judge ultimately held that the claim failed due to lack of causation: the tragic actions of Vance and Belknap could compellingly be ascribed to other factors.

Justice was therefore done, although the judge’s prior holdings remain disquieting. They include the statement “the ‘Do It’s’ on the record were subliminal because they were only discernible after their location had been identified and after the sounds were isolated and amplified”. But, as one of the defence witnesses subsequently wrote (Dr T. Moore, “Scientific Consensus and Expert Testimony: Lessons from the Judas Priest Trial”, The Skeptical Inquirer, Vol 20.6, Nov/Dec 1996), something not consciously discernible is not necessarily unconsciously discernible either.

Dr Moore also pointed out that there is “no evidence whatsoever that subliminal directives can compel compliance”.

By allowing the case to proceed to trial, rather than dismissing it summarily, the judge allowed the junk science on which the plaintiffs’ assertions were based to gain the veneer of plausibility, or at the least the oxygen of publicity. The proceedings also left the band incurring significant and unrecoverable legal costs.

The plaintiffs’ lawyers were just as much to blame for advising their clients to bring an absurd case. They may as well have fashioned an ecclesiastical action on an image of Christ seen on a piece of chapati bread.

Predictably the publicity had some effect. Fellow British metal legend Ozzy Osborne also found himself sued in America over his record Suicide Solution, but the case failed because there were no detectable subliminal messages and the overt exhortations in the lyrics qualified for First Amendment protection.

Attention was granted to the INXS song Suicide Blonde, but the tune was exculpated because it referred to hair colour - somewhat ironic in view of Michael Hutchence’s subsequent death. Presumably however radio stations stopped playing the Billie Holiday classic Gloomy Sunday or the theme to M*A*S*H (Suicide is Painless) around the same time.

With original recordings now almost exclusively in the digital format one hopes we might now be spared “analysis” of supposedly hidden messages in tape distortion, feedback or “white noise”. But I suppose that would be to underestimate the human imagination ...

Cases, Causes and Controversies: fifty tales from the law

My book has now been published.  It can be found in Wildy's bookshops in Lincoln's Inn Archway and Fleet St, or on their website here.

Alternatively it can be ordered from Amazon here.

The blurb is as follows:

What do Prince Charles, Bette Davis, Sir Ian Botham, Mrs Victoria Gillick and a man whose family grave appeared in the background of a splatter horror film have in common?


Each of them felt they had been wronged in some way, and each went to court to try and do something about it. Sometimes their case was a purely private argument. Others brought cases of national importance, or claims which raised acute moral and ethical principles. Some won handsomely, while others lost so badly that they ended up far worse than when they started.

This new book looks at fifty legal disputes from Victorian times to the present day, where a compelling moral or legal issue was at stake, or where the background to the case was interesting, amusing or infuriating.

It begins with three Victorian murders, including the law student favourite of R v Dudley and Stephens, the case of shipwrecked sailors eating the cabin boy and later facing trial for his murder.

It then covers cases ranging from the early days of Hollywood and both world wars, through to modern day battles over superinjunctions, MPs’ expenses, the vexed relationship between religion and law, and the sometimes hazy relationship of law and sport.

Some of the stories border on the absurd. Why did the legendarily tough international sportsmen Ian Botham and Allan Lamb show no fear in the face of hostile fast bowling on the pitch, yet go to their lawyers when their old opponent Imran Khan said something they didn’t like in a newspaper?

Irony runs through many of the cases. Bette Davis was left penniless after losing her case in England and felt she had no option but to return to America and resume working for the studio she had unsuccessfully sued. But after doing so she became one of the richest and most and acclaimed actresses in history. In other cases the irony is less happy: the indigenous rights campaigner Eddie Mabo won a great victory for his people, but was shunned by them during his lifetime and never lived to see his final legal victory.

Then there are the outright tragic: the execution of the civilian Charles Fryatt by the Germans during the Great War, for example, shocked not only his own side but neutral observers of the day as well. In modern times, the blameless good citizens Dianne Pretty and Debbie Purdie were stricken with terminal illnesses and were forced to seek legal approval for their desire to end their lives at a time of their own choosing.

Written in a clear, accessible style, free of legal technicalities, the book will be of interest not simply to lawyers but to anyone interested in stories of great human interest and how the legal system tried to deal with them

The Leveson inquiry - the press, the politicians, Parliament, the police and the public

Free speech, in case anyone needed reminding, is one of the cornerstones of our democracy. So it is not just the media who should be interested in the Leveson report and its aftermath. There is no guarantee that the report’s recommendations will find their way into law, but either way they deserve close scrutiny. The Prime Minister has already indicated he does not accept all of the recommendations, and as is well known could not even agree with the deputy Prime Minister enough to make a joint statement, so we can expect to hear a good deal more in the coming months on the relationship between the press, the politicians, Parliament, the police and the public.

One general question concerns the appropriate composition of this sort of inquiry. Here the inquiry was conducted by a single judge. The report explains that it was hoped that the inquiry would proceed on judicial lines, involving the calling of witnesses and the adducing of evidence, followed by factual findings and conclusions. Certainly a judge or senior barrister would be the obvious choice in those circumstances, but the recommendations and conclusions are not at all confined – nor was it ever expected they would be – to forensic findings. It was not simply a matter of which politician and which policeman had done what with which journalist. The ongoing regulation of the press and others cannot be syllogistically extracted from a set of factual findings about what they have done in the past. Rather, we are into the realm of principle in determining proper limits of free speech, and also the realm of pragmatism in how those limits might be best enforced.

For that reason, for all his undoubted experience of the media reporting litigation over the years, Lord Justice Leveson would, I venture to suggest, have been assisted by others along the lines of a Fleet St grandee and perhaps some retired police and politicians. If it was too difficult to find someone with expertise who was fully independent of any remaining interests in this country, then perhaps assistance could have been found from elsewhere in the Commonwealth.

By way of comparison, in my book I criticise the Chilcott inquiry into the Iraq war for having no lawyers at all and thus no-one experienced in cross-examination. Appropriately there was military expertise on that inquiry but the conduct – and cross-examination of witnesses – would have been enhanced by counsel being added as well. In other words, a better composition could have been found with both Chilcott and Leveson.

Another prior question regarding the Leveson report is whether there was a need for an inquiry at all. The casus belli was the apparent hacking of the mobile phone of the murdered teenager Milly Dowler, but the story turned out not to have been true. Leveson states in forthright fashion that an inquiry was still justified because of ongoing concern about the place of the press. But it does not follow from bad behaviour of the press with other parties that it is the former and not the latter who should be regulated in future.

For example, where the press have been shown to have entered into inappropriate relations with the police, then the answer is tighter controls of police. A police officer leaking information about an inquiry is (potentially) committing a criminal offence. Indeed, the journalist might too if he or she acted in a way that prejudiced a trial. There might also be a civil remedy arising from breaches of the right to privacy, having regard to Art 8 of the European Convention on Human Rights.

The same applies with politicians and civil servants: if they are too close to journalists, or are found leaking information improperly, then they may breach codes of conduct for their respective roles or, again, face both civil and criminal proceedings depending on the circumstances.

In other words, the answer to many of the questions posed by Leveson may well be better enforcement of the existing law, not new laws or new enforcement mechanisms.

The most controversial suggestion in Leveson comes from his suggestion of a statutorily-underpinned but still “independent” regulator. Some reaction has been frankly naïf: one blog suggested the only statute should be an almost verbatim reproduction of the US First Amendment. This is absurd for the simple and trite reason that short of complete anarchy there will always be restrictions on free speech.

That does not mean, however, that a statutory regulator – a stronger restriction in theory than ad hoc laws protecting such things as privacy, state secrets and intellectual property – is necessary or desirable. An independent regulator “underpinned” by statute looks like a statutory regulator at one remove, if not a statutory regulator by any other name.

Leveson conceded that much of the wrongdoing with which he was concerned was already unlawful or, in some cases, illegal, but then suggested an arbitration process which parties would be compelled to follow on pain of not receiving costs in the High Court even if they won. The justification for such a process is the usual objection to litigation of it being too slow and too expensive for the general public. But that applies to all litigation, and it is not clear at all why some form of exemption should be carved out in one area of law and not others.

Secondly, arbitration proceedings are usually confidential, because they constitute a process chosen by parties to a commercial contract as part of their private bargain. The resolution of any disputes arising out of those private affairs is (generally speaking) no-one else’s business. With the press printing stories about individuals without the latter’s consent, any resultant dispute is not part of a consensual bargain. Moreover, there may be a public interest in the proceedings and their outcome which is not present in commercial bargains, so the justification for confidentiality will be much weaker.

Further, commercial arbitration in London is done under the purview of a long-established system of commercial law. By contrast, the law of privacy and the press is in a state of flux. Arbitration proceedings have no precedent value and so will not develop the law at all.

The final point is the elephant that was in the room throughout the Leveson inquiry, in the form of the internet. As I have written before (see Cases, Causes & Controversies: fifty tales from the law (Wildy, Simmons & Hill, 2012), p 151):

… the reality is that since the law (for present purposes) has no reach beyond these shores, it has become – for better or for worse – very much harder indeed to suppress information than ever before. Someone outside the jurisdiction might publish something on the internet that would then be easily accessible to British citizens. It would still be an offence for a British citizen to download and disseminate the information, but readers will need no elaboration of the reality of such a situation.

The only recourse for the government in those circumstances would be to try and censor internet search engines, in the manner of a few largely non-admirable totalitarian regimes elsewhere. I trust such a step is not likely to occur in this country ...

Only today we have seen what modern communications enable overseas media to do, and there is nothing whatsoever that any British statutory body could do about it ..

Foster care, race and politics

According to the press, a foster couple in Rotherham have had their children removed by the local authority on the ground that they were members of UKIP.

A year and a half ago I wrote about foster carers who had been in the headlines because the local authority apparently did not approve of their views on homosexuality.  My conclusion was:

There are many aspects of prospective foster parents that ought to be properly investigated - their financial probity and security, lack of criminal convictions, empathy with children, reasons for wanting to become foster parents, previous involvement with children in whatever capacity, and so forth. Their religious and political views, unless extremist, should not be towards the top of that list.

The same conclusion applies in this case, and therefore the local authority was in the wrong.

Meanwhile Macclesfield Magistrates' Court have apparently convicted a woman of a racially aggravated public order offence on the ground that she called her neighbour a "stupid fat Australian" when the neighbour was in fact a New Zealander. 

As a New Zealander myself this made me raise my eyebrows.  In common with most other Kiwis I would be quite wealthy if I had a pound for every time I have been mistaken for an Australian.  It is always a source of amusement more than anything.  Sometimes the person who has made the mistake is embarrassed, though relieved when I point out it does not bother me one way or the other (why should it? I am sure I have mistaken the odd Canadian for American or vice versa.  All it shows is ignorance on the part of the person who makes the mistake - not an insult against the other person).

More to the point, I do not see how "New Zealand" can refer to race.  Since the beginning of European settlement there New Zealand has always been at least a bicultural country, and demographics nowadays show it to be quite mixed ethnically. Thus the fact that one was born and raised there and has the accent to prove it says nothing about one's race.  I would instead describe "New Zealand" in that context as a culture, though you could make a case that as a multicultural country there are far fewer shared cultural assumptions amongst Kiwis than there might have been twenty or more years ago.

The underlying problem is the provision in public order offences of religious and racial insults as aggravating forms of harassment.  This is well meaning, but in practice likely to be very problematic, as we have seen with religious cases in the past.  Better I would have thought to have a general offence concerning harassment, and to consider all aggravating and mitigating factors as part of the sentencing exercise.

Employment once more: Smith v Trafford Housing Trust

Recently I wrote about an employee dismissed because he joined the British National Party. I argued that someone’s political views ought not to be a ground for dismissal or discipline unless they were somehow relevant to the job. Because the claimant in that case had an exemplary work record, his political affiliation plainly had not affected his work and accordingly he should not have been dismissed – whatever anyone thinks of the BNP. The case of Smith v Trafford Housing Trust [2012] EWHC 3221 (Ch) provides another, stronger example of the same principle.


Mr Smith was employed as a housing manager by the defendant, a private housing trust. In February 2011 he placed a link on his Facebook page to a BBC news article about gay marriages in church, and added the comment “an equality too far”. On the same day one of his Facebook friends responded with the comment “Does this mean you don’t approve”, to which he responded:

“no not really, I don’t understand why people who have no faith and don’t believe in Christ would want to get hitched in church the bible is quite specific that marriage is for men and women if the state wants to offer civil marriage to same sex then that is up to the state; but the state shouldn’t impose it’s (sic) rules on places of faith and conscience.”

For making his two comments Mr Smith was suspended from work on full pay, made the subject of a disciplinary investigation and then disciplinary proceedings leading to a hearing in March 2011, at which he was told he was guilty of gross misconduct justifying his dismissal. Because of his service record, however, he was instead demoted to a non-managerial position, with a consequential 40% pay reduction, phased over 12 months. His subsequent appeal was effectively dismissed, though with an extension of the phasing-in of the salary reduction from one to two years. He issued proceedings contending that the defendant had breached his contract by the demotion and pay reduction.

He contended that he had not been guilty of gross, or any, misconduct in posting the Facebook comments.

The defendant maintained that he had committed breaches of its code of conduct for employees, and acted contrary to its equal opportunities policy.

The judge held that a reasonable reader of Facebook wall page could not rationally conclude that Mr Smith’s two postings about gay marriage in church had been made in any relevant sense on the defendant’s behalf. The brief mention on his Facebook page of the identity of his employer was in no way inconsistent with the general impression to be gained from his Facebook wall – namely, that it was a medium for personal or social, rather than work related, information and views.

That was not to say that Facebook could never be used as a medium for work related communications, but clearly Mr Smith had not been using it in that fashion. Any reader would be left in no doubt that he regarded his employment merely as a fact – and not a particularly interesting fact – about himself. Nor were his postings about gay marriage in church themselves work related.

Those findings constituted robust common sense. Apart from anything else, putting the case at its highest in the defendant’s favour – that is to say, assuming that the comments could in some way be linked to Mr Smith’s employment – I still do not see how the defendant could have been justified in demoting him. As the judge said, his posts were not, viewed objectively, judgmental, disrespectful or liable to cause upset or offence. They were widely held views frequently to be heard on radio and television, or read in the newspapers. He had been mainly responding to an enquiry as to his views, and doing so in moderate language.

Mr Smith’s claim therefore succeeded. Unfortunately the correct measure of damages was the very small difference between Mr Smith’s contractual salary, and the amount actually paid to him during the 12 weeks following his assumption of his new, but reduced, role. That was a modest sum indeed and rendered his victory somewhat pyrrhic. The judge expressed “real disquiet” about that fact – Mr Smith, he reiterated, had been taken to task for doing nothing wrong, suspended and subjected to a disciplinary procedure which wrongly found him guilty of gross misconduct, and then demoted to a non-managerial post with an eventual 40 per cent reduction in salary. The breach of contract which the defendant thereby committed was serious and repudiatory. It was accordingly very lucky indeed to get off so lightly in financial terms.

I suspect that the defendant was acting out of the laudable motive to be seen to be an equal opportunities employer, and not to be seen to endorse any views discriminatory towards any potential customers. These are understandable aims, but do not justify the sort of action that was taken against Mr Smith. The defendant’s policies do not need to be enforced by some form of thought police. If Mr Smith held some views which he only ever expressed in his personal capacity, that was his business, unless perhaps they were so objectionable and offensive and directed at potential customers. But Mr Smith’s views were nothing of the sort. One feels that a disturbing climate is generated by these sorts of cases, in which all employees are expected to be on message politically – something ironically inimical to the notion of a diverse, tolerant society, which has to tolerate dissent and a wide range of views, even those counter to the zeitgeist.

The overarching principle for cases such as Mr Smith’s is that mentioned at the beginning: employees should only be hired or fired, promoted or demoted, according to actions relevant to their job. If they express views in private that have no bearing on their performance at work and in no way related to their employer, it is hard to see why they should be sanctioned by the employer, even if the views are ones which the employer does not share.

J'Accuse - the Dreyfus affair then and now

I have been published in this week's New Law Journal, vol 162, 16 November 2012, p 1434 (£), on the Dreyfus affair.

Petrodel and others v Prest and others: "That must now cease"

Family lawyers and company lawyers alike will be anxious to see what the Supreme Court makes of Petrodel and others v Prest and others [2012] EWCA Civ 1395. The former may see the decision of the Court of Appeal as a gross and unwanted interference with well-established principle and authority. The latter may see it as an obvious correction of an obvious and thoroughly unwarranted legal aberration.

The case was one of the “big money” divorce proceedings that the press have often picked up on in recent years. At first instance, the judge ordered the husband to transfer £17.5m from company assets to the wife on the basis that he was unlikely to transfer assets from his personal resources (see [2011] EWHC 2956 (Fam)). To reach that decision he had to “pierce the corporate veil” and find that the assets of the company were effectively those of the husband. In determining whether it was appropriate to do so he followed a long line of family law cases centred on the concept of fairness and a consequent desire not to allow a spouse to hide assets in a corporate structure.

On appeal Thorpe LJ, a highly experienced family lawyer, upheld the judge’s decision. But he was outnumbered by the other two judges – Rimer and Patten LJJ – both of whom are veterans of the Chancery Division. In the starkest of contrasts they carefully trawled through the long list of authority relied upon by the judge below and endorsed by Thorpe LJ – and demolished the cases one by one.

Rimer LJ gave the main judgment. He said the family authorities were “internally inconsistent, contrary to principle and wrong”, and that the normal rules about company assets applied. The company could not use its assets to satisfy the personal debts of the shareholders any more than the shareholders’ personal assets could be sought by the company’s creditors – as , of course, all company lawyers have known since the seminal Salomon v A Salomon and Company Ltd [1897] AC 22.

Patten LJ said the same thing in a few short paragraphs given in emphatic agreement with and endorsement of Rimer LJ’s judgment:

What needs to be emphasised is that the provisions of s.24(1)(a) of the Matrimonial Causes Act 1973 do not give the court power to disapply the established principles of legal and beneficial ownership or of company law. On the contrary, those principles were plainly intended to define the limits of the court's jurisdiction under the statute and Moylan J was wrong to give the words "entitled, either in possession or reversion" any wider meaning. Married couples who choose to vest assets beneficially in a company for what the judge described as conventional reasons including wealth protection and the avoidance of tax cannot ignore the legal consequences of their actions in less happy times.

I wish particularly to support Rimer LJ's criticism of the dicta in Nicholas and his view that these cannot be relied upon as a correct statement of the law following the decision of this court in Adams v. Cape Industries plc. They have led judges of the Family Division to adopt and develop an approach to company owned assets in ancillary relief applications which amounts almost to a separate system of legal rules unaffected by the relevant principles of English property and company law. That must now cease.

It rather reminds one of the story of the provincial solicitors informing the London solicitors on the other side of a transaction in the early 1930s that the Law of Property Act didn’t apply in their part of the world.

It is not difficult to see the competing points of view. For family lawyers a fair outcome to matrimonial property disputes is the overriding consideration, and if one party is a sophisticated businessperson the use of a company structure may be an obvious way of hiding assets. Both the desire to protect the more vulnerable and the need for a fair outcome in all cases point to the need for flexibility for the court. In turn that means the court will need to be able to look at the substance of a corporate structure rather than its form. Geraldine Morris has a detailed analysis on Halsbury’s Law Exchange from the family lawyer’s point of view.

By contrast, commercial law requires certainty and the last thing that businesspeople are interested in is some sort of assurance that, if things go wrong, their money will be divvied out according to what a judge thinks fair after the time and delay of complex litigation. Instead parties to a commercial transaction will wish to set down in the clearest possible terms who owns what from the outset and who will be entitle to what should the venture fail. One only has to look at how the English Commercial Court became the most respected and sought-after judicial tribunal of its type in Europe after the war. It has usually applied the Salomon principle, looked to the parties’ intention when construing a contract, and followed the precedent system so that contractual wording in one case would be interpreted the same way in the next. As a result Continental courts, with their willingness to imply all manner of terms or overlook the express wording of contracts in pursuit of fairness, saw almost all international business head to London.

I have to say I instinctively side more with the company lawyers on this one, partly because as Patten LJ said one cannot have one set of law applying to one set of proceedings, but also because it does not necessary preclude an unfair outcome. For a start courts could order transfer of shares from one spouse to the other, which would not offend Salomon, although it might not be as tidy a solution by any means. But it is not a straightforward issue by any means.

No doubt the Supreme Court will have to deal with it sooner rather than later, and it will be interesting to speculate where their sympathies will lie. Somewhat atypically the present court contains two family lawyers, Lady Hale and Lord Wilson, but even if both are chosen to hear an appeal raising the point they are likely to be outnumbered by Chancery and Commercial judges, who still comprise the majority of the court as they usually have done. The new President of the Supreme Court, Lord Neuberger, is a former Chancery judge too of course …