COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MR JUSTICE WYN WILLIAMS
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE SEDLEY
LORD JUSTICE LLOYD
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Mr J Findlay and Ms J Oscroft (instructed by Messrs Sharpe Pritchard) for the Respondent
Hearing date: Tuesday 16 October 2007
Crown Copyright ©
Lord Justice Sedley :
1. On the 3rd February 2004 the Defendant granted planning permission and listed building consent to a company known as Mentmore Towers Limited in respect of a scheme of development upon an area of land known as Mentmore Towers. On the 30th April 2004 the Appellant filed a claim for judicial review in which he sought orders quashing those grants. By an order dated the 11th March 2005 Forbes J dismissed the claim after a substantive hearing. Permission to proceed with the claim for judicial review had been granted to the Appellant by Richards J (as he then was) on 23rd September 2004.
2. At the conclusion of the hearing before Forbes J on the 11th March 2005 he made certain consequential orders one of which was in the following terms.
"... the Claimant do pay 75% of the costs of this claim not to include costs of the permission hearing to be subject to detailed assessment if not agreed and paid by the Claimant to the Defendant's solicitors. "
3. The parties could not agree upon the bill of costs presented by the Respondent. In consequence, the Respondent sought a taxation of its costs. The taxation was heard by Master Campbell on 3rd July 2006. Before the Master, the Appellant raised a point which both parties and the Master considered was a point of principle. The point raised by the Appellant was that under the order of Forbes J he should not be liable for any costs incurred by the Respondent before the decision was made to grant him permission to bring his judicial review proceedings except for the costs incurred in preparing the Respondent's acknowledgment of service and grounds of opposition to the claim.
4. In a reasoned judgment the Master rejected the Appellant's contention. He held that under the order of Forbes J the Appellant was liable to pay what he described as "pre-permission costs" subject, of course, to such costs being reasonably incurred. The Respondent was not limited simply to the costs of preparing the acknowledgment of service and grounds of opposition.
5. The Master gave permission to appeal against that ruling.
6. Both parties agree that if the order of Forbes J had been made after a civil trial in the context of a private law dispute the Master's ruling would be correct. However, the Appellant argues that in the particular context of judicial review proceedings the Master's conclusion is wrong. In effect, the case for the Appellant is that the order of Forbes J is to be taken to mean that no pre-permission costs are recoverable (other than the costs of preparing the acknowledgement of service and summary grounds) notwithstanding that there are no words within the order which expressly suggest that is to be the case.
7. It is to be noted that no argument was addressed to Forbes J upon the issue of "pre-permission costs" generally. As his order makes clear, however, he was asked to exclude from the costs payable to the Defendant the costs of the permission hearing an application on the part of the Claimant to which he acceded.
This appeal raises an important point of practice. I note that it said that different judges in the Administrative Court are exercising their discretion in different ways on the point at issue.
For my part, I would regard the extract from the judgment of Ouseley J in Young (see p 17 of the small bundle) as representing the correct position, but it is incumbent on the costs judge on an assessment to be watchful in relation to the nature of the respondent's pre-permission costs he decides to allow.
It appears to me to be desirable for the full court to carry out an authoritative review of the whole position.
The purpose of the permission hearing
"…. The whole purpose of requiring that leave should first be obtained to make the application for judicial review would be defeated if the court were to go into the matter in any depth at that stage. If, on a quick perusal of the material then available, the court thinks that it discloses what might on further consideration turn out to be an arguable case in favour of granting to the applicant the relief claimed, it ought, in the exercise of a judicial discretion, to give him leave to apply for that relief. …"
In the same vein, Lord Woolf in his 1989 Hamlyn Lectures, Protection of the Public – a New Challenge, noted that the Justice All Souls Review had argued for the abolition of the leave requirement but said (p.21):
"In practice the requirement, far from being an impediment to the individual litigant, can even be to his advantage since it enables a litigant expeditiously and cheaply to obtain the view of a High Court judge on the merits of his application."
Planning disputes and judicial review
"We are satisfied that there are features of public law litigation which distinguish it from private law civil and family litigation … The important difference here is that there is a public interest in the elucidation of public law by the higher courts in addition to the interests of the individual parties. One should not therefore necessarily expect identical principles to govern the incidence of costs in public law cases …"
The present problem
"77. Such an approach seems to me to accord with public policy in providing ready access to the courts by individuals or bodies seeking relief from and/or to draw attention to actual or threatened transgressions of the law by public bodies, whilst, in exceptional cases protecting those bodies and the public that funds them from unnecessary, burdensome and costly substantive litigation. If properly and consistently applied by the courts, I can see nothing about it that would, as Mr. Steel suggested, undermine the fairness and probity of judicial review as a means of control of the administration or run contrary to Article 6.1 of the European Convention of Human Rights, Lord Woolf's Civil Justice Reforms or the adoption of them in this context in the Bowman Report."
3. In addition and without prejudice to the review procedures referred to in paragraphs 1 and 2 above, each Party shall ensure that, where they meet the criteria, if any, laid down in its national law, members of the public have access to administrative or judicial procedures to challenge acts and omissions by private persons and public authorities which contravene provisions of its national law relating to the environment.
4. In addition and without prejudice to paragraph 1 above, the procedures referred to in paragraphs 1, 2 and 3 above shall provide adequate and effective remedies, including injunctive relief as appropriate, and be fair, equitable, timely and not prohibitively expensive. Decisions under this article shall be given or recorded in writing. Decisions of courts, and whenever possible of other bodies, shall be publicly accessible.
This policy is explicitly adopted in the Public Participation Directive 2003/35/EC, Art. 3.7.
"The costs of dealing with a threatened claim are generally irrecoverable, unless a claim is made, gets permission and eventually the claimant loses."
(1) On the conclusion of full judicial review proceedings in a defendant's favour, the nature and purpose of the particular claim is relevant to the exercise of the judge's discretion as to costs. In contrast to a judicial review claim brought wholly or mainly for commercial or proprietary reasons, a claim brought partly or wholly in the public interest, albeit unsuccessful, may properly result in a restricted or no order for costs.
(2) If awarding costs against the claimant, the judge should consider whether they are to include preparation costs in addition to acknowledgment costs. It will be for the defendant to justify these. There may be no sufficient reason why such costs, if incurred, should be recoverable.
(3) It is highly desirable that these questions should be dealt with by the trial judge and left to the costs judge only in relation to the reasonableness of individual items.
(4) If at the conclusion of such proceedings the judge makes an undifferentiated order for costs in a defendant's favour
(a) the order has to be regarded as including any reasonably incurred preparation costs; but
(b) the 2004 Practice Statement should be read so as to exclude any costs of opposing the grant of permission in open court, which should be dealt with on the Mount Cook principles.
The present case
Lord Justice Lloyd:
Sir Anthony Clarke MR:
"the Claimant do pay 75% of the costs of this claim not to include costs of the permission hearing to be subject to detailed assessment if not agreed and paid by the Claimant to the Defendant's solicitors. "
As I see it, in an order in that form "the costs of the claim" means the "costs of and incidental to" the claim: see section 51(1) of the Supreme Court Act 1981. Those costs can include costs incurred before issue of the proceedings, although, this being an order for assessment on the standard basis, in order to be entitled to payment of any particular item of such costs, the successful party (whether claimant or defendant) must show (as in the case of every other item of costs claimed) that it was reasonably incurred and both proportionate and reasonable in amount: see CPR 44.4(1) and (2).
"…. In considering whether, and in what circumstances, there should be a departure from the basic rule that costs follow the event in public interest challenge cases, in my view it is important to have in mind the rationale for that basic rule, and that it is for the applicants to show why, exceptionally, there should be a departure from it."
The basic rule he refers to is, as he explained at page 356C, that costs follow the event in public law cases, as in others, because, where an unsuccessful claim is brought against a public body, it imposes costs on that body which have to be met out of money diverted from the funds available to fulfil its primary public functions.