One of the main parts of the Government's anti-terror legislation suffered a devastating blow when the High Court ruled that the Home Secretary's decision to place a British terror suspect under house arrest was "conspicuously unfair".
Mr Justice Sullivan said yesterday that the Government had tried to apply a "thin veneer of legality" to bring in new measures that denied individuals the right to a fair trial.
The judge said a British man, identified only as MB, had been arrested last year and then subjected to strict controls over his movements in this country on the order of the Home Secretary. MB was the first British man to be given a control order brought in last year under anti-terror laws.
It is believed three more British men and eight foreign nationals are also subject to control orders.
Unless the Government wins an appeal, they are all expected to be released from what amounts to a form of house arrest.
The judge said the Prevention of Terrorism Act 2005 did not "disguise the reality" that suspects' rights were being determined by ministers. "The thin veneer of legality which is sought to be applied by section 3 of the Act cannot disguise the reality that controlees' rights under the Convention are being determined not by an independent court in compliance with Article 6.1 but by executive decision-making untrammelled by any prospective of effective judicial supervision," he added.
In a damning verdict on the Government's anti-terror policy Mr Justice Sullivan added: "The court would be failing in its duty under the Human Rights Act if it did not say, loud and clear that the procedure under the Act whereby the court merely reviews the lawfulness of the Secretary of State's decision to make the order upon the basis of the material available to him at that early stage are conspicuously unfair."
He said: "To say the Act does not give the respondent in this case 'a fair hearing' in the determination of his rights under Article 8 of the European Convention on Human Rights would be an understatement."
In a summary of his judgment, the judge described how MB was put under a control order because the Home Secretary, Charles Clarke, believed he would go to Iraq to fight the US and British forces. MB is required to surrender his passport, live at home and report to the police every day. His house is liable to be searched at any time.
Ministers brought in the control orders last year after the House of Lords ruled the previous policy of detention of foreign terror suspects without trial or charge was incompatible with human rights legislation. The new laws gave the Home Secretary the power to impose control orders on all terror suspects, whether British or foreign.
Last night, human rights lawyers applauded the judge's decision.
Shami Chakrabarti, the director of Liberty, said: "This completely scandalous system of punishment without trial is definitely in tatters tonight. This policy - like its predecessor legislation, the Belmarsh disgrace - has been rightly and roundly condemned by the High Court. The Government now has no alternative but to go back to the drawing board."
The Home Secretary said he intended to appeal against the decision. A Home Office spokesman insisted the judge's comments would not affect the operation of the control orders laws. The Government made it clear that the Home Secretary had no intention of releasing MB from the control order or placing a stay on the authorisation of further control orders.