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You are here: BAILII >> Databases >> United Kingdom Supreme Court >> Edwards & Anor, R (on the application of) v Environment Agency & Ors (No 2) [2013] UKSC 78 (11 December 2013) URL: http://www.bailii.org/uk/cases/UKSC/2013/78.html Cite as: [2013] UKSC 78, [2014] WLR 55, [2014] 1 All ER 760, [2014] Env LR 17, [2014] 1 WLR 55, [2014] 3 Costs LO 319, [2014] 2 CMLR 25 |
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Michaelmas Term
[2013] UKSC 78
JUDGMENT
R (on the application of Edwards and another (Appellant)) v Environment Agency and others (Respondents) (No 2)
before
Lord Neuberger, President
Lord Hope
Lord Mance
Lord Clarke
Lord Carnwath
JUDGMENT GIVEN ON
11 December 2013
Heard on 22 July 2013
Appellant David Wolfe QC (Instructed by Richard Buxton Environmental and Public Law) |
Respondents James Eadie QC James Maurici QC (Instructed by Treasury Solicitor) |
LORD CARNWATH (with whom Lord Neuberger, Lord Hope, Lord Mance and Lord Clarke agree)
Judicial review proceedings
"I'm too rich [to get legal aid], because I own my own house, so someone in Rugby has to come forward who feels strongly enough to take the case forward under the legal aid scheme."
Although there was no direct evidence from Mr Edwards that he had responded to this request for assistance, the judge found it difficult to resist the inference that he had been –
"put up as a claimant in order to secure public funding of the claim by the Legal Services Commission… when those who are the moving force behind the claim believe that public funding for the claim would not otherwise have been available".
Keith J held that this somewhat unconventional background neither deprived Mr Edwards of a sufficient interest to bring judicial review proceedings, nor constituted an abuse of process. There was no appeal from that conclusion. It had the consequence that the proceedings in the High Court continued at public expense and without significant risk to the applicant, or to his supporters, of an adverse costs order if they lost.
"I say that that was not unnatural as burning rubber is notorious for the noxious smell given off and the dense smoke created and many, unaware of the way in which the chipped tyres would be burned in a modern 'state of the art' kiln at temperatures of up to 1400 degrees, would expect and fear the worst." (para 5)
However, as he found in the course of his judgment, these fears, natural or not, were contradicted by the evidence. He dismissed an argument that the proposal was a change which "may have significant adverse effects on the environment" (EIA Directive Annex II para 13), saying:
"… it is plain… that tyre burning in itself as a fuel has no significant adverse effects on the environment and, indeed, overall may even have beneficial effects on the environment..." (para 31).
Lord Hoffmann, giving the leading judgment in the House of Lords on the substantive appeal, described this as –
"an unchallenged finding of fact that the only change in operation proposed by the application, namely the use of tyres, would not have significant negative effects on human beings or the environment…" ([2008] 1 WLR 1587, para 30)
Lindsay J rejected grounds alleging non-compliance with the two directives. He upheld a complaint of procedural unfairness by the Agency arising from failure to disclose an internal assessment report "AQMAU 1" relating to emissions of "particulate matter" (PM10), but exercised his discretion to refuse relief. He also declined to make a reference to the CJEU.
"… given the Judge's finding on the evidence before him of no environmental harm from the plant and the continuous and dynamic nature of the PPC regulatory system enabling assessments to be made on what is known rather than predicted by AQMAU over three years ago, it would be pointless to quash the permit simply to enable the public to be consulted on out-of-date data." (para 126)
The court again declined to make a reference to the CJEU.
"Their Lordships proceed on the basis that the appeal raises an issue or issues of general importance and they are prepared to assume that [existence] of private interest may not always preclude the making of a special costs order in such a case. But their Lordships do not accept that information about the applicant's means, about the identity and means of any who she represents and about the position generally in the absence of any special order, are or should be regarded as immaterial; further, they do not consider that the suggested protective orders regarding costs appear proportionate on the information which is before them and in the light of the nature of the issues involved; and they do not consider that any case has been made for saying that the proposed appeal would be 'prohibitively expensive' or that Directive 2003/35/EC would be breached without a special order."
The dispute over costs
"Should the question whether the procedure is or is not prohibitively expensive be decided on an 'objective' basis by reference to the ability of an 'ordinary' member of the public to meet the potential liability for costs, or should it be decided on a 'subjective' basis by reference to the means of the particular claimant, or upon some combination of the two bases?" (para 42)
Sullivan LJ had taken the view that a purely subjective approach would not be consistent with the objectives underlying the Directive. On the facts of the Garner case, which was concerned only with the position at first instance, he held that an order should have been made capping the claimant's potential costs liability to the defendant at £5,000.
Government consultation
"18 A number of domestic cases dating from R (Corner House Research) v Secretary of State for Trade and Industry [2005] 1 WLR 2600 including R (Garner) v Elmbridge Borough Council [2011] 1 Costs LR 48 (8 September 2010), have set out the basic principles underpinning the use of PCOs in judicial review proceedings.
19 The cases did not provide detailed guidance on the level at which a PCO should be set, but Garner made it clear that a level of twice the national average income would be too high. In Garner itself the court awarded a PCO at £5,000…."
"27 An absolute cap would have the advantage for users of providing the most certainty, but it would also provide the same protection for wealthy organisations and individuals as for those of more limited means. A presumptive limit would be more capable of being targeted at those most in need, but if too flexible could give rise to unnecessary and time consuming arguments about costs."
"35 Taking account of the levels which are currently being used by the courts as well as the importance of setting a level which could not be further reduced, it is proposed that the cap should be set at a level of £5,000. This is on the basis that any claimant who is so impecunious that the possibility of being liable for £5,000 would present an insuperable barrier to proceeding would in most cases be eligible for legal aid, with its attendant cost protection in any event..."
"3 … On the basis of the results of this consultation and the evidence of current practice in the courts, the Government takes the view that a cap of £5,000 is a proportionate amount to ask individual claimants to pay. On the same basis it believes that it is reasonable to make a distinction between the position of individuals and organisations and therefore proposes to set a cap of £10,000 for organisations."
"8 The similarity of the proposals to a fixed costs regime indicates in the Government's view, and as one respondent strongly argued, that it will be appropriate for appeals to be dealt with in accordance with the rule proposed by Lord Justice Jackson for appeals in cases to which a fixed or restricted costs regime applied at first instance. Under that rule, when it is implemented as part of the wider Jackson reforms, the judge considering whether to give permission to appeal in a case which was subject at first instance to a fixed or restricted costs regime will at the outset determine the appropriate costs limit or limits having had regard to the decisions in the lower court."
"Amendments are made to comply with the Aarhus Convention so that any system for challenging decisions in environmental matters is open to members of the public and is not prohibitively expensive. Two limits are set: on the costs recoverable by a defendant from a claimant (£5,000 where the claimant is an individual and £10,000 in any other circumstances) and; on the costs recoverable by a claimant from a defendant (£35,000). Consequential amendments are made to PD 25A, Part 54 and the Pre-Action Protocol Judicial Review. The amendments do not apply to a claim commenced before 1 April 2013."
"Orders to limit the recoverable costs of an appeal
52.9A.—(1) In any proceedings in which costs recovery is normally limited or excluded at first instance, an appeal court may make an order that the recoverable costs of an appeal will be limited to the extent which the court specifies.
(2) In making such an order the court will have regard to—
(a) the means of both parties;
(b) all the circumstances of the case; and
(c) the need to facilitate access to justice.
(3) If the appeal raises an issue of principle or practice upon which substantial sums may turn, it may not be appropriate to make an order under paragraph (1).
(4) An application for such an order must be made as soon as practicable and will be determined without a hearing unless the court orders otherwise."
In the Supreme Court, the Costs Practice Direction No 13 (as amended with effect from November 2013) now includes specific provision for "an order limiting the recoverable costs of an appeal in an Aarhus Convention claim" (para 2.2.c).
The CJEU's decision
"40 That assessment cannot, therefore, be carried out solely on the basis of the financial situation of the person concerned but must also be based on an objective analysis of the amount of the costs, particularly since, as has been stated in para 32 of the present judgment, members of the public and associations are naturally required to play an active role in defending the environment. To that extent, the cost of proceedings must not appear, in certain cases, to be objectively unreasonable. Thus, the cost of proceedings must neither exceed the financial resources of the person concerned nor appear, in any event, to be objectively unreasonable.
41 As regards the analysis of the financial situation of the person concerned, the assessment which must be carried out by the national court cannot be based exclusively on the estimated financial resources of an 'average' applicant, since such information may have little connection with the situation of the person concerned.
42 The court may also take into account the situation of the parties concerned, whether the claimant has a reasonable prospect of success, the importance of what is at stake for the claimant and for the protection of the environment, the complexity of the relevant law and procedure and the potentially frivolous nature of the claim at its various stages: see, by analogy, DEB Deutsche Energiehandels-und Beratungsgesellschaft mbH v Bundesrepublik Deutschland (Case C-279/09, BAILII: [2010] EUECJ C-279/09) [2010] ECR I-13849, para 61.
43 It must also be stated that the fact, put forward by the Supreme Court of the United Kingdom, that the claimant has not been deterred, in practice, from asserting his or her claim is not in itself sufficient to establish that the proceedings are not, as far as that claimant is concerned, prohibitively expensive for the purpose (as set out above) of Directives 85/337 and 96/61.
44 Lastly, as regards the question whether the assessment as to whether or not the costs are prohibitively expensive ought to differ according to whether the national court is deciding on costs at the conclusion of first-instance proceedings, an appeal or a second appeal, an issue which was also raised by the referring court, no such distinction is envisaged in Directives 85/337 and 96/61, nor, moreover, would such an interpretation be likely to comply fully with the objective of the European Union legislature, which is to ensure wide access to justice and to contribute to the improvement of environmental protection.
45 The requirement that judicial proceedings should not be prohibitively expensive cannot, therefore, be assessed differently by a national court depending on whether it is adjudicating at the conclusion of first-instance proceedings, an appeal or a second appeal."
i) First, the test is not purely subjective. The cost of proceedings must not exceed the financial resources of the person concerned nor "appear to be objectively unreasonable", at least "in certain cases". (The meaning of the latter qualification is not immediately obvious, but it may be better expressed in the German version "in Einzelfällen", meaning simply "in individual cases".) The justification is related to the objective of the relevant European legislation (referred to in para 32 of the judgment), which is to ensure that the public "plays an active role" in protecting and improving the quality of the environment.
ii) The court did not give definitive guidance as to how to assess what is "objectively unreasonable". In particular it did not in terms adopt Sullivan LJ's suggested alternative of an "objective" assessment based on the ability of an "ordinary" member of the public to meet the potential liability for costs. While the court did not apparently reject that as a possible factor in the overall assessment, "exclusive" reliance on the resources of an "average applicant" was not appropriate, because it might have "little connection with the situation of the person concerned".
iii) The court could also take into account what might be called the "merits" of the case: that is, in the words of the court, "whether the claimant has a reasonable prospect of success, the importance of what is at stake for the claimant and for the protection of the environment, the complexity of the relevant law and procedure, the potentially frivolous nature of the claim at its various stages." (para 42)
iv) That the claimant has not in fact been deterred for carrying on the proceedings is not "in itself" determinative.
v) The same criteria are to be applied on appeal as at first instance.
"… that finding cannot be interpreted as meaning that in assessing the permissible cost burden in appeal proceedings the costs already incurred in courts below may be ignored. Instead, each court must ensure that the costs at all levels of jurisdiction taken together are not prohibitive or excessive." (para 23)
"42. Recognition of the public interest in environmental protection is especially important since there may be many cases where the legally protected interests of particular individuals are not affected or are affected only peripherally. However, the environment cannot defend itself before a court, but needs to be represented, for example by active citizens or non-governmental organisations."
Conversely -
"A person who combines extensive individual economic interests with proceedings to enforce environmental law can, as a rule, be expected to bear higher risks in terms of costs than a person who cannot anticipate any economic benefit. The threshold for accepting the existence of prohibitive costs may thus be higher where there are individual economic interests." (para 45)
i) A reasonable prospect of success Lack of a reasonable prospect of success in the claim may, it seems, be a reason for allowing the respondents to recover a higher proportion of their costs. The fact that "frivolity" is mentioned separately (see below), suggests that something more demanding is envisaged than, for example, the threshold test of reasonable arguability.
ii) The importance of what is at stake for the claimant As indicated by Advocate General Kokott, this is likely to be a factor increasing the proportion of costs fairly recoverable. As she said, a person with "extensive individual economic interests" at stake in the proceedings may reasonably be expected to bear higher risks in terms of costs.
iii) The importance of what is at stake for the protection of the environment Conversely, and again following the Advocate General's approach, this is likely to be a factor reducing the proportion of costs recoverable, or eliminating recovery altogether. As she said, the environment cannot defend itself, but needs to be represented by concerned citizens or organisations acting in the public interest.
iv) The complexity of the relevant law and procedure This factor is not further explained. Its relevance seems to be that a complex case is likely to require higher expenditure by the respondents, and thus, objectively, to justify a higher award of costs. Although mention is only made of complexity of law or procedure, the same presumably should apply to technical or factual complexity.
v) The potentially frivolous nature of the claim at its various stages The respondents should not have to bear the costs of meeting a frivolous claim. In domestic judicial review procedures, whether at first instance or on appeal, this issue is likely to be resolved in favour of the claimant by the grant of permission,
The present case
"… the correct position is that litigation costs may not exceed the personal financial resources of the person concerned and that, in objective terms, that is to say, regardless of the person's own financial capacity, they must not be unreasonable. In other words, even applicants with the capacity to pay may not be exposed to the risk of excessive or prohibitive costs and, in the case of applicants with limited financial means, objectively reasonable risks in terms of costs must in certain circumstances be reduced further." (emphasis added)
Thus, he says, it is necessary to start from an objectively defined standard, the circumstances of the particular individual being relevant only to the extent that they may reduce that figure. Furthermore, in his submission, the question of what is objectively reasonable was answered definitively by the government itself, when following extensive consultation it adopted the figure of £5,000 (as now embodied in the High Court rules). As he submits, the respondents cannot properly go behind that figure, at least without evidence to support any alternative suggestion.
Michaelmas Term
[2010] UKSC 57
On appeal from:
JUDGMENT
R (on the application of Edwards and another (Appellant)) v Environment Agency and others (Respondents)
before
Lord Hope, Deputy President
Lord Walker
Lord Brown
Lord Mance
Lord Dyson
JUDGMENT GIVEN ON
15 December 2010
Heard on 11 November 2010
Appellant David Wolfe (Instructed by Richard Buxton Environmental and Public Law) |
Respondents James Eadie QC James Maurici Charles Banner (Instructed by Treasury Solicitor) |
LORD HOPE, delivering the judgment of the Panel
"Any such procedure shall be fair, equitable, timely and not prohibitively expensive."
Article 15a of the IPPC Directive makes identical provision with respect to proceedings to which that directive applies.
(i) where an order for costs has been made, whether as a general rule the court assessing those costs has any jurisdiction to implement the directives;
(ii) if so, whether in the particular circumstances of this case the costs officers should seek to do so; and
(iii) if so, whether on the evidence presented the amount of costs payable by the appellant should be moderated or even excluded altogether.
The costs officers decided the first two issues in favour of the appellant. They reserved their opinion on the third issue until they had given written reasons for their decision on the first two issues and the parties had had an opportunity to consider whether to appeal against it.
(1) whether it was open to the costs officers, in the circumstances of this case in which applications to the court to reduce or cap a party's liability had been made to and considered by and rejected by the Court, to achieve that result through the detailed assessment process; and
(2) if it was, whether the test indicated by the phrase "prohibitively expensive" should be focused exclusively on the actual circumstances of the parties to the litigation and not on the question what would be prohibitively expensive for the ordinary member of the public.
The single Justice referred the application to a panel of five Justices and directed that these questions should be decided after an oral hearing. The panel, having now heard counsel, is grateful for their assistance on these issues of principle.
Background
"Their Lordships proceed on the basis that the appeal raises an issue or issues of general importance and they are prepared to assume that absence of private interest may not always preclude the making of a special costs order in such a case. But their Lordships do not accept that information about the applicant's means, about the identity and means of any who she represents and about the position generally in the absence of any special order, are or should be regarded as immaterial; further, they do not consider that the suggested protective orders regarding costs appear proportionate on the information which is before them and in the light of the nature of the issues involved; and they do not consider that any case has been made for saying that the proposed appeal would be 'prohibitively expensive' or that Directive 2003/35/EC would be breached without a special order."
Notwithstanding the rejection of these applications Mrs Pallikaropoulos proceeded with her appeal.
"That the appellant do pay or cause to be paid to the respondents their costs of the appeal to this House, the amount of such costs to be certified by the Clerk of the Parliaments if not agreed between the parties."
No reasons were given for this decision.
"(1) Any act, judgment or order of the original court in the transferred proceedings is to have the same effect after the transfer day as if it had been an act, judgment or order of the Supreme Court in corresponding proceedings in that court.
(2) Accordingly, after the transfer day, further proceedings may be taken in the Supreme Court in respect of such an act, judgment or order."
"(1) Where the Court is to assess the amount of costs it will assess those costs –
(a) on the standard basis, or
(b) on the indemnity basis, in the manner specified by rule 51 or (where appropriate) on the relevant bases that apply in Scotland or Northern Ireland.
(2) Where –
(a) the Court makes an order about costs without indicating the basis on which the costs are to be assessed, or
(b) the Court makes an order for costs to be assessed on a basis other than one specified in paragraph (1), the costs will be assessed on the standard basis.
(3) This rule applies subject to any order or direction to the contrary."
"The costs officers have discretion as to the amount to allow. In exercising this discretion they bear in mind the terms 'unreasonably incurred' and 'unreasonable in amount' in CPR 44.4, (or in appeals from Scotland the provisions of rule 42.10 of the Rules of the Court of Session 1994) and in particular consider to what extent an item assisted the Court in determining the appeal."
The costs officers' judgment
"We neither have nor assert any right to set aside or vary any decision already made by the Law Lords or by the Justices in this case. If, in advance of the hearing before us, the Law Lords or the Justices had made any decision on the implementation of the EU Directives in this case we would of course act in compliance with that decision. However, we take the view that the pronouncements which the Law Lords have made in this case do not prevent us from applying the Aarhus principles in the course of our assessment."
In their view no part of the decision in March 2007 ruled out their discretion to decide that the reasonable costs in the case should be nil or should be no more than a nominal amount: para 25. While the costs order of 18 July 2008 gave the respondents stronger ground for saying that the appellant had raised the Aarhus principles already and had lost them, they noted that the order did not expressly deal with them. They said that this was consistent with their finding that those matters were best dealt with at the stage at which costs are assessed rather than at the stage at which costs are awarded. The order expressly left the amount of costs to be determined. They decided that they should determine that amount taking into account the Aarhus principles: para 27.
The jurisdiction of the costs officers
"The Court may make such orders as it considers just in respect of the costs of any appeal, application for permission to appeal, or other application to or proceeding before the Court."
The rules about the basis of assessment of costs which correspond to those in CPR rules 44.4 and 44.5 are set out in rule 49 which provides for the detailed assessment of costs to be carried out by the costs officers (see para 11, above), and in rule 51 which provides with regard to the standard basis of assessment:
"(1) Costs assessed on the standard basis are allowed only if they are proportionate to the matters in issue and are reasonably incurred and reasonable in amount.
(2) Any doubt as to whether costs assessed on the standard basis are reasonably incurred and are reasonable and proportionate in amount will be resolved in favour of the paying party."
"20 There is a real distinction between (a) carrying out an assessment and deciding as part of the assessment to reduce the bill by a percentage and (b) deciding in advance of the assessment that the receiving party will only receive a percentage of the assessed costs. The figure that results from (a) represents 100% of the assessed costs. In deciding as part of the assessment to reduce the bill by a percentage, the costs judge is giving effect to an order that the successful party is entitled to his costs, to be assessed if not agreed. The figure that results from (b) represents less than 100% of the assessed costs. In deciding in advance of the assessment that the receiving party will only receive a percentage of the assessed costs, the costs judge is not giving effect to an order that the successful party is entitled to his costs, to be assessed if not agreed.
21 Rule 44.3 gives a judge jurisdiction to make a type (b) order. There is no doubt that at the end of a hearing the judge may make an order of the kind that the defendant sought from the [costs judge] in the present case. In such a case, the judge is not purporting to vary an order if he disallows the successful party a proportion of his costs. He is making the order. He does not have the advantage accorded to the costs judge of having a detailed bill of costs. He cannot, therefore, carry out a detailed assessment. But he usually has the benefit, denied to the costs judge, of knowing a good deal about the case, and is often in a good position to form a view about the reasonableness of the parties' conduct. When carrying out a detailed assessment, the costs judge is not making an order for costs. His position is quite different from that of a judge exercising the jurisdiction given by rule 44.3."
"Except in prescribed circumstances, costs ordered against an individual in relation to any proceedings or part of proceedings funded for him shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including –
(a) the financial resources of all the parties to the proceedings, and
(b) their conduct in connection with the dispute to which the proceedings relate;
and for this purpose proceedings, or a part of proceedings, are funded for an individual if services relating to the proceedings or part are funded for him by the Commission as part of the Community Legal Service."
Since in most cases the reasonable sum that results from this exercise is nil, the assessments of reasonableness could vary substantially between periods when a losing litigant was legally aided and when he was not. In the costs officers' view the factors which they would have to take into account in implementing the EU Directives were not wholly dissimilar from the factors that they have to take into account under section 11 of the 1999 Act when it applies: para 16.
The Court's obligation under the Directives
"This raises an important issue of principle. Should the question whether the procedure is or is not prohibitively expensive be decided on an 'objective' basis by reference to the ability of an 'ordinary' member of the public to meet the potential liability for costs, or should it be decided on a 'subjective' basis by reference to the means of the particular claimant, or upon some combination of the two bases?"
"Whether or not the proper approach to the 'not prohibitively expensive' requirement under article 10a should be a wholly objective one, I am satisfied that a purely subjective approach, as was applied by Nicol J, is not consistent with the objectives underlying the directive. Even if it is either permissible or necessary to have some regard to the financial circumstances of the individual claimant, the underlying purpose of the directive to ensure that members of the public concerned having a sufficient interest should have access to a review procedure which is not prohibitively expensive would be frustrated if the court was entitled to consider the matter solely by reference to the means of the claimant who happened to come forward, without having to consider whether the potential costs would be prohibitively expensive for an ordinary member of 'the public concerned'."
There was evidence that without a protective costs order the liability and costs of an unsuccessful appellant was likely to be prohibitively expensive to anyone of ordinary means. So the judge's decision was set aside.
Conclusion
"In principle it must be that your Lordships, as the ultimate court of appeal, have power to correct any injustice caused by an earlier order of this House. There is no relevant statutory limitation on the jurisdiction of the House in this regard and therefore its inherent jurisdiction remains unfettered. In Broome v Cassell & Co Ltd (No 2) [1972] AC 1136 your Lordships varied an order for costs already made by the House in circumstances where the parties had not had a fair opportunity to address argument on the point."
He went on to say that it should be made clear that the House would not reopen any appeal save in circumstances where, through no fault of a party, he or she had been subjected to an unfair procedure.
ANNEX
IN THE SUPREME COURT OF THE UNITED KINGDOM
Parliament Square
London,
Date: 15 January 2010
Before :
MRS REGISTRAR DI MAMBRO AND MASTER O'HARE
- - - - - - - - - - - - - - - - - - - - -
Between :
THE QUEEN ON THE APPLICATION OF [DAVID EDWARDS] LILIAN PALLIKAROPOULOS |
Appellant |
|
- and - | ||
THE ENVIRONMENT AGENCY THE FIRST SECRETARY OF STATE SECRETARY OF STATE FOR THE ENVIRONMENT FOOD AND RURAL AFFAIRS |
Respondents |
|
- and - | ||
CEMEX UK CEMENT LIMITED | Intervener |
- - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - -
Mr Wolfe (instructed by Richard Buxton) for the Appellant
Mr Maurici (instructed by Environment Agency Legal Services and the Treasury Solicitors) for the Respondents
Hearing date: 4 December 2009
- - - - - - - - - - - - - - - - - - - - -
Approved Judgment
.............................
Mrs Registrar di Mambro and Master O'Hare:
"… have access to a review procedure before a court of law or another independent and impartial body established by law to challenge the substantive or procedural legality of decisions, acts or omissions subject to the participation provisions of this directive."
and it also provides that:
"Any such procedure shall be fair, equitable, timely and not prohibitively expensive."
"32. The 2008 Sullivan report, to which Carnwath LJ referred in granting permission in the present case, was a report of another informal working group representing a range of interested groups, this time under Sullivan J (Ensuring Access to Environmental Justice in England and Wales – Report of the Working Group on Access to Environmental Justice May 2008). The report expressed views on the application of the Aarhus principles, in the context of domestic procedures relevant to environmental proceedings, including protective costs orders. The present case was mentioned, without further discussion, as apparently the first which has reached this court raising issues under the Convention in relation to a costs order in private law proceedings. The following points from the report are possibly relevant in the present context:
i) That the "not prohibitively expensive" obligation arising under the Convention extends to the full costs of the proceedings, not merely the court fees involved (in this respect differing from the Irish High Court in Sweetman v An Bord Pleanala and the Attorney General [2007] IEHC 153);
ii) That the requirement for procedures not to be prohibitively expensive applies to all proceedings, including applications for injunctive relief, and not merely the overall application for final relief in the proceedings;
iii) That costs, actual or risked, should be regarded as "prohibitively expensive" if they would reasonably prevent an "ordinary" member of the public (that is, "one who is neither very rich nor very poor, and would not be entitled to legal aid") from embarking on the challenge falling within the terms of Aarhus (para 20).
iv) That there should be no general departure from the present "loser pays" principle, provided that the loser's potential liability does not make litigation prohibitively expensive in the way described above (para 38).
…
47. It may be helpful at this point to draw together some of the threads of the discussion, without attempting definitive conclusions:
i) The requirement of the Convention that costs should not be "prohibitively expensive" should be taken as applying to the total potential liability of claimants, including the threat of adverse costs orders.
ii) Certain EU Directives (not applicable in this case) have incorporated Aarhus principles, and thus given them direct effect in domestic law. In those cases, in the light of the Advocate-General's opinion in the Irish cases, the court's discretion may not be regarded as adequate implementation of the rule against prohibitive costs. Some more specific modification of the rules may need to be considered.
iii) With that possible exception, the rules of the CPR relating to the award of costs remain effective, including the ordinary "loser pays" rule and the principles governing the court's discretion to depart from it. The principles of the Convention are at most a matter to which the court may have regard in exercising its discretion.
iv) This court has not encouraged the development of separate principles for "environmental" cases (whether defined by reference to the Convention or otherwise). In particular the principles governing the grant of Protective Costs Orders apply alike to environmental and other public interest cases. The Corner House statement of those principles must now be regarded as settled as far as this court is concerned, but to be applied "flexibly". Further development or refinement is a matter for legislation or the Rules Committee.
v) The Jackson review provides an opportunity for considering the Aarhus principles in the context of the system for costs as a whole. Modifications of the present rules in the light of that report are likely to be matters for Parliament or the Civil Procedure Rules Committee. Even if we were otherwise attracted by Mr Wolfe's invitation (on behalf of CAJE) to provide guidelines on the operation of the Aarhus convention, this would not be the right time to do so.
vi) Apart from the issues of costs, the Convention requires remedies to be "adequate and effective" and "fair, equitable, timely". The variety and lack of coherence of jurisdictional routes currently available to potential litigants may arguably be seen as additional obstacles in the way of achieving these objectives."
"24. In that regard it should be remembered, first that the member state's obligation under a directive is to achieve the result envisaged by the directive and their duty … to take all appropriate measures whether general or particular, to ensure fulfilment of that obligation, are binding on all the authorities of the member state including, for matters within their jurisdiction, the courts …
25. … whenever the provisions of a directive appear, so far as their subject matter is concerned, to be unconditional and sufficiently precise, they may be relied upon before the national courts by individuals against the state where the latter has failed to implement the directive in domestic law …
26. … implementation of a directive must be such as to ensure its application in full …"
i) Where an order for costs has been made, whether, as a general rule, the court assessing those costs has any jurisdiction to implement the EU Directives.
ii) If so, whether, in the particular circumstances of this case, we should seek to implement the EU Directives.
iii) If so, whether, on the evidence presented to the court, the amount of costs payable by the Appellant should be moderated or even excluded.
Issue 1 : Jurisdiction of Costs Officers Generally
"The Costs Officers have discretion as to the amount to allow. In exercising this discretion they bear in mind the terms "unreasonably incurred" and "unreasonable in amount" in CPR 44.4 … and in particular consider to what extent an item assisted the court in determining the appeal …"
"20. There is a real distinction between (a) carrying out an assessment and deciding as part of the assessment to reduce the bill by a percentage and (b) deciding in advance of the assessment that the receiving party will only receive a percentage of the assessed costs. The figure that results from (a) represents 100% of the assessed costs. In deciding as part of the assessment to reduce the bill by a percentage, the costs judge is giving effect to an order that the successful party is entitled to his costs, to be assessed if not agreed. The figure that results from (b) represents less than 100% of the assessed costs. In deciding in advance of the assessment that the receiving party will only receive a percentage of the assessed costs, the costs judge is not giving effect to an order that the successful party is entitled to his costs, to be assessed if not agreed.
21. Rule 44.3 gives a judge jurisdiction to make a type (b) order. There is no doubt that at the end of a hearing, the judge may make an order of the kind that the defendant sought from the district judge in the present case. In such a case, the judge is not purporting to vary an order if he disallows the successful party a proportion of his costs. He is making the order. He does not have the advantage accorded to the costs judge of having a detailed bill of costs. He cannot, therefore, carry out a detailed assessment. But he usually has the benefit, denied to the costs judge, of knowing a good deal about the case, and is often in a good position to form a view about the reasonableness of the parties' conduct. When carrying out a detailed assessment, the costs judge is not making an order for costs. His position is quite different from that of a judge exercising the jurisdiction given by rule 44.3."
"… shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including –
(a) the financial resources of all the parties to the proceedings, and
(b) their conduct in connection with the dispute to which the proceedings relate …"
"… costs, actual or risked, should be regarded as "prohibitively expensive" if they would reasonably prevent an "ordinary" member of the public (that is, "one who is neither very rich nor very poor, and would not be entitled to legal aid") from embarking on the challenge falling within the terms of Aarhus."
i) The financial resources of both parties.
ii) Their conduct in connection with the appeal.
iii) The fact that the threat of an adverse costs order did not in fact prohibit the appeal.
iv) The fact that a request to waive security money was refused and security was in fact provided.
v) The amount raised and paid for the Appellant's own costs.
Issue 2 : Issue Estoppel
"Their Lordships do not consider it appropriate to make any order on the application made to them for a dispensation in respect of the requirement to put up security and for a protective costs order.
Their Lordships have considered the criteria in R (Cornerhouse Research) v Secretary of State for Trade & Industry [2005] EWCA Civ 192 and the submissions made with regard to their application and potential relaxation.
Their Lordships proceed on the basis that the appeal raises an issue or issues of general importance and they are prepared to assume that absence of private interest may not always preclude the making of a special costs order in such a case. But their Lordships do not accept that information about the Applicant's means, about the identity and means of any who she represents and about the position generally in the absence of any special order, are or should be regarded as immaterial: further, they do not consider that the suggested protective orders regarding costs appear proportionate on the information which is before them and in the light of the nature of the issues involved; and they do not consider that any case has been made for saying that the proposed appeal would be "prohibitively expensive" or that Directive 2003/35/EC would be breached without a special order."
"In the event of their Lordships, notwithstanding the above, deciding to award costs in favour of the Respondents, they are requested to consider:
- Limiting them to the costs of one Respondent …
- Limiting the costs to 70% of the Respondent's costs. At the High Court and Court of Appeal stages only 70% of costs were awarded …
- Reducing the burden on the Appellant by ordering any costs in excess of the £25,000 security monies already lodged with the House of Lords to be payable by instalments of at most £5,000 per annum and without interest (other than in the event of late payment).
- In any event staying the effect of the order until the issues relating to "prohibitive expense" and Directive 2003/35/EC are resolved between the Commission and the UK Authorities."
"That the Appellant do pay or cause to be paid to the Respondents their costs of the appeal to this House, the amount of such costs to be certified by the Clerk of the Parliaments if not agreed between the parties."
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