There has been a recent up date in caselaw about whether or not the Secretary of State may deprive a person of their British Citizenship under section 40 of the British Nationality Act 1981 and in particular a limitation on that power if by exercising it, it made a person stateless.
The case Al-Jedda v SSHD  EWCA Civ 358 concerned an Iraqi national who came to the UK in 1992 as a refugee. In 2000 he was naturalised; In 2004, he was detained by British forces in Iraq on grounds of suspected involvement with terrorism. His case may be known to many as it was the subject of a ruling of the Grand Chamber of the European Court of Human Rights in July 2011 that his detention between October 2004 and December 2007 was in breach of Article 5. Shortly before his release on 30 December 2007, the Secretary of State made an order to deprive him of his British citizenship.
The greater part of the judgment gives consideration to Iraqi nationality law, in particular Article 11 of the Transitional Administrative Law and Article 10 of the 2006 Nationality Law. This consideration may well be of interest in other cases, but is not analysed here. In short, the Court of Appeal concluded that neither Article provided that Al-Jedda had automatically reacquired the Iraqi nationality, which it was uncontentious he had lost on his naturalisation as a British citizen in 2000.
The Secretary of State nonetheless sought to argue that, even if Al-Jedda had not automatically reacquired Iraqi nationality, Iraqi law provided the means for him to do so on application (which would be bound to be successful) and hence he had not been made stateless by the deprivation of British citizenship but by his failure to apply for Iraqi nationality. The Court of Appeal accepted, for the purpose of argument (though Richards LJ noted that “the point is by no means free from doubt“), that such an application would be bound to succeed. This made no difference. The deprivation order had made Al-Jedda stateless (paragraph 121). Accordingly, the order was unlawful and was quashed.