R (Z) v Hackney London Borough Council (Supreme Court)

In brief

The Supreme Court dismissed the appeal [117]. It held that a Jewish housing charity (Agudas Israel Housing Association) that allocated its housing to members of the Orthodox Jewish community was within the defences in sections 158 (positive action) and 193 (charities) of the EA 2010, because the Divisional Court's finding that the policy was proportionate could not be faulted [73], [117]. Section 193 permits a charity acting in pursuance of its charitable instrument to restrict benefits to persons sharing a protected characteristic where the provision is either (a) a proportionate means of achieving a legitimate aim or (b) for the purpose of preventing or compensating for a disadvantage linked to the characteristic [21]; limb (b) carries no implied requirement of proportionality [110]–[111], [117]. The charity's objects give primary benefit to the Orthodox Jewish community, and surplus properties would go to others [36], [42]; but demand far exceeds supply, so the policy has a blanket effect in practice. The Court held that this did not make it disproportionate, and that it would be proportionate for the charity to operate a simple 'blanket policy' while the community's disadvantages remain [77]. It said that the state may use bright-line criteria to focus benefits on a particular group, 'and hence exclude other groups' [85], and that this applies all the more to a charity [86].

Key provisions

• charities-exception — EA 2010 s.193 charities exception (with s.158 positive action): two alternative limbs; the proportionality limb is the usual structured test, including a 'no more than necessary' stage : A charity acting in pursuance of its charitable instrument may restrict benefits to persons sharing a protected characteristic if the provision is either (a) a proportionate means of achieving a legitimate aim or (b) for the purpose of preventing or compensating for a disadvantage linked to the characteristic [21]. Proportionality is one route, not a requirement for both: limb (b) carries no implied requirement of proportionality [110]–[111], [117]. Under s.158 and s.193(2)(a) the test is the usual structured proportionality test (the four-stage Akerman-Livingstone test), one stage of which asks whether the means are no more than necessary [40], [73]; the Court rejected only the appellant's stricter tie-break and safety-valve conditions drawn from Equal Treatment Directive cases [60]–[66]. Proportionality is assessed between groups [79]–[80], and a blanket effect in practice was held proportionate on the facts [77].
• paras-110-111 — s.193(2)(b): no implied requirement of proportionality : Parliament framed s.193(2)(b) as a separate and distinct limb. Having regard to the margin of appreciation, charities regulation and the way Parliament framed it, that limb 'satisfies the proportionality requirement across the range of cases in which it applies', so no separate requirement that a charity prove proportionality is implied [110]; nor can s.3(1) of the Human Rights Act 1998 be used to read one in, since that would make the limb redundant [111], [117].

When relevant

Cite when: (a) a charity, acting in pursuance of its charitable instrument, restricts benefits to members of a group sharing a protected characteristic [21]; (b) the EA 2010 s.193 charities exception or s.158 positive action is being analysed [6], [24]; (c) the structure of the proportionality test is in issue: under s.158 and s.193(2)(a) it includes a 'no more than necessary' stage [40], [73], while s.193(2)(b) needs no proportionality showing [110], [117]; (d) faith-based service provision by a charity (the case concerned a religion-based housing charity) — including the SPA-2026 charities-exception analysis (fn 72, fn 77). The judgment decided nothing about single-sex services, women-only refuges or sport [100].