England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT

		Royal Courts of Justice Strand London, WC2A 2LL
		Date: 20 November 2013

Lord Justice Jackson :

1. This judgment is in four parts, namely:

Part 1. Introduction,

Part 2. The facts,

Part 3. The present proceedings,

Part 4. The appeal to the Court of Appeal.

Part 1. Introduction

2. This is an appeal against a costs order in an immigration case. The claimant, who is the appellant in judicial review proceedings, asserts that he was substantially successful in his claim and that therefore he ought to have recovered the costs of the action. The claimant says that the judge erred in principle in only awarding him a small proportion of those costs.
3. The correct approach to costs appeals has been considered in a large number of authorities. For present purposes it is only necessary to refer to two. The first case which Miss Collier for the respondent drew to our attention is Roache v Newsgroup Newspapers Ltd and others, [1998] EMLR 161. In the first paragraph of his judgment at page 172, Stuart-Smith LJ said that the Court of Appeal must not be tempted to interfere with the judge's costs order merely because the court would have exercised the judge's discretion differently from the way in which the judge did. He added:

"Before the court can interfere it must be shown that the judge has either erred in principle in his approach, or has left out of account, or taken into account, some feature that he should, or should not, have considered, or that his decision is wholly wrong because the court is forced to the conclusion that he has not balanced the various factors fairly in the scale."

4. More recently this court has considered the correct approach to costs appeals in immigration cases in KR v Secretary of State for the Home Department [2012] EWCA Civ 1555. At paragraph 9 of his judgment, Maurice Kay LJ, with whom Elias LJ and Dame Janet Smith agreed, substantially repeated the guidance set out in the Roache case and said that it was applicable to costs appeals in immigration cases. In KR, the Court of Appeal did interfere with the judge's order because the court considered that order to be significantly flawed. The judge had failed to recognise that the appellant had been the successful party in the litigation.
5. Having reminded myself of the correct approach to costs appeals of this nature I must now turn to the facts.
Part 2. The facts

6. The claimant is a Chinese national who was born in 1984 and is now aged 29. He came to the UK in 2000 and claimed asylum. Thereafter he remained in this country unlawfully. From time to time he was arrested and made subject to reporting conditions. It was not the claimant's practice to comply with such conditions. Instead he slipped out of sight until his next arrest.
7. On 2 December 2005 the claimant was arrested and found to be in possession of cloned credit cards and a false passport. He relied on the false passport in order to give a false name and address to the police. He was in due course convicted at Luton Crown Court of deception offences, handling stolen goods and possession of a false instrument with intent. In February 2006 the claimant was sentenced to 20 months and 14 days imprisonment. In October 2006 he was served with a notice of decision to make a deportation order. The claimant exercised his right of appeal against that order but the appeal was unsuccessful. A deportation order was signed on 9 March 2007. The claimant's date for release from his criminal sentence was 15 October 2007 but the claimant continued in detention for sometime after that date pursuant to the Immigration Acts. The Secretary of State began attempts to obtain documentation from the Chinese authorities to facilitate the deportation. The claimant challenged his continued detention in two sets of judicial review proceedings, the course of which it is not necessary to trace for present purposes.
8. On 29 February 2008 the claimant indicated that he would return voluntarily to China. In view of that indication he was released from immigration detention on 4 March 2008 subject to reporting conditions. Those who imposed the conditions may have been somewhat optimistic in the light of past experience. The claimant, in accordance with his usual practice, did not comply with those conditions. He was next discovered in Glasgow on 7 November 2010. He gave a false name to the customs officers who questioned him. He was duly arrested and then admitted who he really was. He was released on temporary admission with reporting restrictions but of course did not comply with those conditions. The claimant was discovered in London on 10 September 2011. He was detained under the powers of the Immigration Acts.
9. The Secretary of State then resumed his attempt to obtain the necessary documents to facilitate the claimant's return to China. There was some delay whilst a file dealing with the claimant's case was transferred from Liverpool to London. There were difficulties in the Secretary of State's investigations because the claimant gave very little information when he was interviewed by British or Chinese officials. This necessarily slowed down the process of securing the deportation of the claimant to China. Whilst these matters were being pursued the claimant remained in immigration detention. In early 2012 the claimant took the view on advice that his detention was unlawful. Accordingly, he commenced the present proceedings.
Part 3. The Present Proceedings

10. By a claim form issued in the Administrative Court on 18 May 2012 the claimant challenged the lawfulness of his continued detention. The claimant applied for the following relief. One, an order for full disclosure of all communications between the defendant and the Chinese authorities in connection with the Secretary of State's attempt to obtain a travel document for the claimant. Two, a declaration that the claimant's continued detention was unlawful. The Secretary of State resisted the judicial review proceedings. Permission to proceed was granted and a hearing was fixed for 23 August 2012.
11. In order to substantiate his claim that his detention was unlawful the claimant needed to secure disclosure of the documents held by the Secretary of State relating to the attempts to secure the documentation for the claimant's deportation to China and admission into China. There was some delay in obtaining the necessary documentation. Some material was delivered to the claimant's representatives on 2 July. Other more important documents arrived later. It was not until 13 August (the date when the Secretary of State served his summary grounds of defence) that a full set of detention reviews was supplied to the claimant's solicitors.
12. On 22 August 2012 the Secretary of State served a witness statement of Mr Martin Smith, an official within the UKBA, dealing with the claimant's case and the efforts made to secure his transfer to China. The late receipt of material by the claimant's solicitors made it impracticable for the hearing to proceed on 23 August. Accordingly, when the parties arrived at court there was discussion about practicalities. Mr Philip Nathan, who represented the claimant said that he would wish to cross-examine Mr Martin Smith. Mr Smith was not present and there had been insufficient opportunity for the claimant's lawyers to examine the recently disclosed material.
13. In those circumstances the judge, before whom the litigation came, namely Mr CMG Ockleton (Sitting as a Deputy Judge of the High Court) gave directions. The directions began by accepting the Secretary of State's undertaking to complete the enquiries which were in hand and to complete the disclosure which was in hand. The directions then went on to order that an appropriate official should attend at the adjourned hearing to be available for cross-examination. The order directed the claimant to serve amended grounds of claim by 5 September and a date was set for the final hearing of the action on 21 September. It was envisaged that amended grounds of claim would be required because of facts and matters emerging from the disclosed documents.
14. The Secretary of State duly continued making disclosure. Two officials in substitution for Martin Smith, the author of the original witness statement, made themselves available for the hearing. The parties arrived at court on 21 September. Once again the hearing was before Mr CMG Ockleton (Sitting as a Deputy High Court Judge), I shall refer to him as "the judge". Mr Nathan began to open his case at 10.30 am. He took his opening quite shortly, the judge no doubt having carefully studied the bundle in advance of the hearing. The judge apparently interjected to indicate his concern that the Secretary of State seemed to have made little progress in relation to securing the transfer of the claimant to China since 23 August, the last occasion when the matter was before the court. The judge very sensibly put a number of pertinent questions to counsel for the Secretary of State and invited counsel to take instructions. Counsel for the Secretary of State took instructions. Then the counsel for both parties came back into court. There was some further discussion with the judge. The judge came to the conclusion that, applying the relevant principles, the detention of the claimant could no longer be justified.
15. The relevant principles which the judge had to apply in this exercise are generally referred to as the Hardial Singh principles because they were formulated by Woolf J in R v Governor of Durham Prison Ex parte Hardial Singh [1984] 1 WLR 704. For present purposes I can set out those principles quite concisely in the terms used by the judge of which neither party makes any criticism in this appeal. First, the Secretary of State must intend to deport a person and can only use the power to detain for that purpose. Secondly, the deportee may only be detained for a period that is reasonable in all the circumstances. Thirdly, if before the expiry of the reasonable period it becomes apparent that the Secretary of State will not be able to effect the deportation within that reasonable period he should not seek to exercise the power of detention. Fourthly, the Secretary of State should act with reasonable diligence and expedition to effect removal.
16. The judge indicated to the parties that, applying those principles, he did not consider that the continued detention of the claimant beyond that date, ie 21 September, could be justified. Accordingly, he sent counsel for both parties out of court in order to agree an order for the immediate release of the claimant from detention. Counsel did so, they came back, the judge approved or possibly amended and approved counsel's draft. Then he made an order that the claimant be discharged from custody.
17. After the question of release had been determined the hearing continued. There was on the claimant's side a claim for damages for unlawful detention. Mr Nathan, no doubt emboldened by his success to date in the proceedings, embarked enthusiastically upon his submissions that there was an extensive period of unlawful detention before 21 September for which damages ought to be awarded. A Home Officer official was called to give evidence and Mr Nathan cross-examined him. Counsel dealt with as much they could on the day of the hearing but there was not time for oral closing speeches. Accordingly, the judge directed that the parties submit written submissions. The parties duly did so.
18. The judge considered the written submissions and handed down his reserved judgment on 17 December 2012. The judge reviewed the history of the claimant's career in this country, the previous period of detention in 2007 and 2008, the more recent period of detention which had been terminated by the judge's order of 21 September 2012, and related matters. The judge, after a careful analysis of the historic material, came to the conclusion, applying the Hardial Singh principles, that the only period of unlawful detention ran from 7 to 20 October 2011. The judge ruled that the claimant was entitled to damages for that period of unlawful detention. However, he added the discouraging comment that damages were unlikely to be more than nominal. In those circumstances perhaps unsurprisingly no steps have been taken to set up a hearing for the assessment of damages.
19. Following the hand down of his written judgment the judge heard argument on the issue of costs. Mr Nathan submitted that he should have the costs of the litigation because the claimant had secured that which he had primarily sought, namely, release from detention. The Secretary of State resisted that submission and argued that there should be no order for costs.
20. The judge considered counsel's submissions and gave an oral judgment on the costs issue. The judge noted that Mr Nathan characterised the proceedings as intended primarily to secure the claimant's release. He noted that that had been secured by 12.15 pm on the second day of the hearing, i.e. 21 September. The judge also noted that after 12.15 on 21 September the claimant's counsel had pressed on with a case which had in very large part failed. The judge said this in paragraph 4 of his judgment:

"In my judgment this is not a case where it is appropriate for the claimant to have all his costs. The claimant has substantially failed in the claim as it was presented."

The judge then went on to acknowledge that the claimant had had a measure of success. He decided that the proper order was that the Secretary of State should pay the claimant's costs incurred after 23 August 2012.

21. The claimant was aggrieved by the judge's order of 17 December in relation to costs. Accordingly, he appealed to the Court of Appeal.
Part 4. The Appeal to the Court of Appeal

22. By an appellant's notice dated 21 January 2013 the claimant appealed to the Court of Appeal on the ground that the ruling on cost was perverse. This was because:

"The appellant had been the successful party up to 12.15 pm on 21 September. The appellant will argue that he ought to have been awarded his costs up to that date and concedes that the defendant ought to be entitled to her costs arising thereafter to be offset against the appellant's earlier costs ".

23. The claimant obtained permission to appeal at an oral hearing before Gloster LJ on 14 June 2003. With the benefit of that permission the claimant's appeal comes before this court today.
24. Mr Nathan, appearing for the claimant today as he has at all earlier hearings, submits that the judge mischaracterised the claimant's degree of success. Mr Nathan submits that the claimant was substantially the winner. From the point of view of the claimant, what he wanted more than anything else was to be released from custody. Once he had secured that primary goal then obviously the claimant went on to seek to recover damages for unlawful detention in accordance with his pleaded case, but what the claimant sought above all else was his own liberty. Mr Nathan also points out the oddity of the fact that the claimant recovered his costs in respect of the period where he was unsuccessful, namely after the hearing on 21 September. That was the period when written submissions were being made which were largely rejected by the judge. On the other hand the claimant does not recover on the judge's order any costs before 23 August when he was pursuing a plainly meritorious claim. Mr Nathan accepts that there is a high hurdle to cross. It must be shown that the judge erred in principal or erred in one of the ways described by the Court of Appeal in the Roache case and in KR. Mr Nathan submits that in the circumstances of this case he surmounts that hurdle and this court should interfere with the costs order.
25. In the course of his submissions Mr Nathan helpfully took us through the history of the litigation. He pointed out that that the claimant could not properly marshal his case until the crucial disclosure was given. That did not happen until shortly before the hearing on 23 August, which therefore had to be adjourned. Mr Nathan also makes the point that in order to decide whether or not the claimant should be immediately released the judge had to examine all of the historic material. It would be wrong to characterise any of the historic material that was before the court as being only relevant to the damages claimed for unlawful detention and irrelevant to the claim for release from custody.
26. Miss Collier, who appears on behalf of the Secretary of State, began her submissions by drawing attention quite properly to the steep test which must be satisfied before the court will interfere with a costs order made at first instance. Miss Collier pointed out that the judge had the benefit of seeing and hearing the case presented before him. The judge characterised the case as one in which the claimant had substantially failed. The judge rejected Mr Nathan's submission that the claim was primarily for release from detention and this court should not disturb the judge's assessment of those matters or indeed the judge's order for costs. Miss Collier drew our attention to paragraph 55 of the judge's judgment in which the judge considered the extensive submissions made by Mr Nathan in relation to the claim for the past unlawful detention. She pointed out quite rightly that those submissions had not fared well. They had been rejected. Miss Collier urged us to uphold the costs order originally made.
27. I have carefully considered paragraph 55 and following of the judgment. It seems to me that here the judge was focusing upon arguments which were addressed to him after 12.15 pm on 21 September. It will be recalled that in the afternoon of 21 September the judge heard oral evidence from Mr Smith. Thereafter the judge received written submissions from both parties. The judge rejected the arguments which were being deployed on behalf of the claimant during that phase of the case.
28. The fact remains, however, that up until 12.15 pm on 21 September, the claimant was the victor. If one looks at the claim form one can see that in addition to seeking disclosure of documents, which was clearly for the purpose of proving his case, the one substantive remedy which the claimant was seeking was "a declaration that the claimant's continued detention is unlawful". The claimant was not seeking that declaration out of academic interest. The claimant was seeking that declaration in order to secure his release from custody. No doubt the claimant was interested in the abstruse legal arguments about the legality of his earlier detention. But it seems to me, reviewing the history of this litigation, that what the claimant wanted above all else was his liberty. The liberty of the subject was at stake in this litigation and the claimant succeeded in securing his liberty.
29. During the course of argument this morning, Black LJ asked Miss Collier whether she could point to any of the material which was placed before the court at the beginning of the hearing of 21 September which was only relevant to the claim for damages for unlawful detention and was not relevant to the claim for immediate release. Miss Collier, who dealt with the court's questions very fairly and candidly, could not point to any such material. She accepted that the argument and evidence placed before the court was indeed relevant to the release issue.
30. It follows from the Hardial Singh principles that in determining whether or not the time has arrived when the court must order the release of a person like the claimant from immigration detention, the court has to stand back and look at the whole of the past history and the issues that arose during the period of historic detention.
31. In those circumstances I am driven to the conclusion that this judge, with great experience of immigration issues, in this particular case fell into error. It is impossible to characterise the claimant as anything other than the victor in this litigation. From the date when proceedings were issued on 18 May 2012 until midday on 21 September the claimant was pursuing a case for his liberty and his release from detention. He succeeded in that claim. Thereafter, no doubt on his instructions, his counsel went on and there was a claim for damages for unlawful detention which was only successful in very small part. It is reasonable to characterise the Secretary of State as being the victor in respect of the litigation after 12.15 pm on the second day of the hearing. In my view the costs order made by the judge was based upon an error of principle. The error was the failure to characterise the claimant as the successful party in the litigation.
32. I readily accept that the claimant cannot recover all of his costs for the litigation. He was unsuccessful in respect of the matters explored on the afternoon of 21 September and the matters argued in the written submissions thereafter. It seems to me that the proper approach to costs in this case, since this court must now re-exercise the original discretion, is that the claimant should recover his costs up to 12.15 pm on 21 September and the Secretary of State should recover costs thereafter.
33. An order in this form would be highly inconvenient for the costs judge and indeed for the parties dealing with the assessment of costs. I have therefore explored with counsel what proportionate order for costs would give effect in broad terms to a decision such as that which I have indicated. Mr Nathan, having taken instructions, submitted that the proper order for costs would be that the claimant should have 80 per cent of its costs. Miss Collier, on behalf of the Secretary of State, did not demur from that apportionment, should it turn out that the appeal succeeded.
34. Let me now draw the threads together. In my view the order for costs made by the judge at first instance cannot stand. If my Lady agrees, the appeal will be allowed and there will be an order that the claimant recovers 80 per cent of its costs in the court below.
35. I should add this: I have encountered a number of appeals in recent months where the Secretary of State, either having lost in court or having conceded before trial, nevertheless resists an adverse costs order. This may be because I get more than my fair share of costs cases. Cases of this nature really should not be coming to the Court of Appeal. If the Secretary of State were to accept a liability for costs in appropriate cases, much expense would be saved on both sides.

LADY JUSTICE BLACK:

36. I agree with all that my Lord has said, subject just to one matter. If Miss Collier, dealing as she was at the time with my cross-examination very ably, omitted to say anything that she wanted to say with regard to the question of the percentage of the costs then I would certainly be prepared to listen to anything that she wanted to say about that.