England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		27th January 2015

Lord Justice Burnett:

Introduction

1. The principal issue in this claim is whether statutory changes made to the ability of acquitted defendants in the Crown Court to recover their costs from central funds are compatible with the European Convention of Human Rights ("ECHR").
2. On 15 July 2013 the claimant was acquitted at Kingston-upon-Thames Crown Court of a single count of assault occasioning actual bodily harm contrary to Section 47 of the Offences Against the Person Act 1861. He was tried by Mr Recorder Christie QC and a jury between 8 and 15 July. An earlier trial in March 2013 had resulted in a hung jury. The claimant was represented by solicitors and counsel instructed on a private basis. His costs are put at about £70,000. An application was made on his behalf at the end of the trial for a defendant's costs order pursuant to Section 16 of the Prosecution of Offences Act 1985 ("the 1985 Act"). The Recorder refused the application on the basis that he had no jurisdiction to make such an order. He held that amendments made to the 1985 Act by the Legal Aid, Sentencing and Punishment of Offenders Act 2012 ("LASPO") which introduced a new section 16A prevented the recovery of costs from central funds by a defendant acquitted following trial in the Crown Court who had been committed or sent for trial after 1 October 2012, as was this claimant.
3. The claimant was arrested on 12 April 2012 but not charged for about three months. On 3 September 2012 the Magistrates accepted jurisdiction but the claimant wished to elect trial in the Crown Court. The next hearing was set for 15 October when the claimant was committed for trial. He was unfortunate in the timing of these steps. On his behalf his solicitor, Mr Christodoulou, is critical of the pace at which the initial investigation was conducted by the police and of the conduct of the Crown Prosecution Service ("CPS") which he suggests resulted in the committal being delayed and thus falling on the wrong side of 1 October 2012. Whether the criticism is justified or not, it does not bear on the issues which fall to be decided in this claim for judicial review.
4. By amended grounds the claimant contends that:

i) section 16A of the 1985 Act is incompatible with the articles 6 and 14 of the Convention and in consequence seeks a declaration of incompatibility pursuant to section 4 of the Human Rights Act 1998;

ii) section 16A is in conflict with the 1688 Bill of Rights and common law notions of fairness, balance and justice with the result that the courts should fashion a new common law entitlement to costs despite the statutory prohibition;

iii) that the court should order compensation to the claimant for the costs he incurred in defending himself, with the amount to be determined on a detailed assessment.

5. The original grounds were concerned with the statutory scheme in place after 1 October 2012. The amended grounds seek the declaration also in respect of the statutory scheme which followed changes put in place from the 27 January 2014.
6. The proceedings were issued on 14 October 2013 with the Secretary of State for Justice as defendant. The original grounds sought to argue that the Recorder was wrong to conclude that the statute prohibited an award of costs, sought a quashing order in respect of his refusal to order costs from central funds and a mandatory order that the claimant have his costs from central funds subject to a detailed assessment. Various other forms of relief were sought, including the declaration of incompatibility. The Secretary of State for Justice is not constitutionally responsible for the orders made by judges. The defendant should have been the Crown Court. However, the claim form was forwarded to the Crown Court which, as is often the case, indicated that it wished to take no part. Permission to apply for judicial review was granted on the papers on the original grounds in the absence of any pleading from the Secretary of State. The Secretary of State for Justice later became involved because a declaration of incompatibility has been sought. Grounds of resistance were provided in response to the claim as originally formulated and to the amended grounds.
7. It follows that the claimant has permission to seek a declaration of incompatibility in respect of section 16A of the 1985 Act as it operated at the time he made his application for costs. He does not have permission in respect of the later scheme, the Bill of Rights and common law argument, or the claim for compensation. Miss Gerry QC, who appears for the claimant, seeks permission on those grounds. We have treated the hearing as a rolled-up permission application for the purpose of those grounds. Miss Davidson for the Secretary of State resists all ground on their merits but also submits that the claimant has no standing to seek a declaration of incompatibility in respect of a later statutory scheme that did not apply to his case.
8. A direct challenge to the decision of the Recorder is no longer pursued by the claimant. Section 29(3) of the Senior Courts Act 1981 excludes the jurisdiction of the High Court to make mandatory, prohibiting or quashing orders in respect of the Crown Court when exercising its jurisdiction in matters relating to trial on indictment. In Re Sampson [1987] 1 WLR 194 (HL) decided that an order in respect of costs made at the end of a Crown Court trial formed part of its "jurisdiction in matters relating to trial on indictment". In consequence judicial review of such an order was not available. The statutory provision under consideration in Sampson was the predecessor of section 29(3) but was in materially identical terms. An argument that section 29(3) as interpreted by the House of Lords was itself incompatible with the Convention failed in R (Regentford) v Canterbury Crown Court [2000] EWHC 440 Admin; [2001] HRLR 18 (DC).

Defendant's Costs Orders in the Crown Court

9. Section 16(2) of the 1985 Act empowered the Crown Court to make a defendant's costs order following acquittal. Originally the Court was obliged to fix the sum payable from central funds but in due course a mechanism for assessment was introduced. It was in those circumstances that a defendant who had instructed lawyers privately in his defence could recover his outlay (subject to detailed assessment) on acquittal.
10. Means testing for criminal legal aid was introduced in the Crown Court between January and June 2010 by the Criminal Defence Service (Contribution Orders) Regulations 2009 (SI 2009/3328). Any natural person facing prosecution in the Crown Court was entitled to legal aid but contributions were required depending upon means. On acquittal any contribution made towards defence costs was repaid with interest. That remained the position until 27 January 2014 when the Criminal Legal Aid (Financial Resources)(Amendment) Regulations 2013 (SI 2013/2791) introduced an upper income threshold, the effect of which ordinarily is to deny criminal legal aid to defendants in the Crown Court whose disposable household income exceeds £37,500 a year. There are hardship provisions which may ameliorate the position in some cases.
11. LASPO and the web of regulations governing criminal legal aid made significant changes to the approach in the Crown Court which affected cases sent for trial on or after 1 October 2012. LASPO made amendments to section 16 and inserted a new 16A into the 1985 Act:

"16. – Defence costs.

(1) Where –

(a) an information laid before a justice of the peace for any area, charging any person with an offence, is not proceeded with;

(c) a magistrates' court dealing summarily with an offence dismisses the information;

that court or, in a case falling within paragraph (a) above, a magistrates' court for that area, may make an order in favour of the accused for a payment to be made out of central funds in respect of his costs (a "defendant's cost order").

(2) Where –

(a) any person is not tried for an offence for which he has been indicted or sent for trial; or

(b) any person is tried on indictment and acquitted on any count in the indictment;

the Crown Court may make a defendant's costs order in favour of the accused.

(3) Where a person convicted of an offence by a magistrates' court appeals to the Crown Court under section 108 of the Magistrates' Court Act 1980 (right of appeal against conviction or sentence) and, in consequence of the decision on appeal–

(a) his conviction is set aside; or

(b) a less severe punishment is awarded;

the Crown Court may make a defendant's costs order in favour of the accused.

(4) Where the Court of Appeal–

(a) allows an appeal under Part I of the Criminal Appeal Act 1968 against–

(i) conviction;

(ii) a verdict of not guilty by reason of insanity; or

(iii) a finding under the Criminal Procedure (Insanity) Act 1964 that the appellant is under a disability, or that he did the act or made the omission charged against him;

(aa) directs under section 8(1B) of the Criminal Appeal Act 1968 the entry of a judgment and verdict of acquittal;

(b) on an appeal under that Part against conviction–

(i) substitutes a verdict of guilty of another offence;

(ii) in a case where a special verdict has been found, orders a different conclusion on the effect of that verdict to be recorded; or

(iii) is of the opinion that the case falls within paragraph (a) or (b) of section 6(1) of that Act (cases where the court substitutes a finding of insanity or unfitness to plead);

(c) on an appeal under that Part against sentence, exercises its powers under section 11(3) of that Act (powers where the court considers that the appellant should be sentenced differently for an offence for which he was dealt with by the court below);

(d) allows, to any extent, an appeal under section 16A of that Act (appeal against order made in cases of insanity or unfitness to plead);

the court may make a defendant's costs order in favour of the accused.

(4A) The court may also make a defendant's costs order in favour of the accused on an appeal under section 9(11) of the Criminal Justice Act 1987.

(5) Where–

(a) any proceedings in a criminal cause or matter are determined before a Divisional Court of the Queen's Bench Division;

(b) the Supreme Court determines an appeal, or an application for leave to appeal, from such a Divisional Court in a criminal cause or matter;

(c) the Court of Appeal determines an application for leave to appeal to the Supreme Court under Part II of the Criminal Appeal Act 1968; or

(d) the Supreme Court determines an appeal, or application for leave to appeal, under Part II of that Act;

the court may make a defendant's costs order in favour of the accused.

(6) a defendant's costs order shall, subject to the following provisions of this section, be for the payment out of central funds, to the person in whose favour the order is made, of such amount as the court considers reasonably sufficient to compensate him for any expenses properly incurred by him in the proceedings.

(6A) Where the court considers that there are circumstances that make it inappropriate for the accused to recover the full amount mentioned in subsection (6), a defendant's costs order must be for the payment out of central funds of such lesser amount as the court considers just and reasonable.

(6B) Subsections (6) and (6A) have effect subject to–

(a) section 16A, and

(b) regulations under section 20(1A)(d).

(6C) when making a defendant's cost order, the court must fix the amount to be paid out of central funds in the order if it considers it appropriate to do so and–

(a) the accused agrees the amount, or

(b) subsection (6A) applies.

(6D) Where the court does not fix the amount to be paid out of central funds in the order–

(a) it must describe in the order any reduction required under subsection (6A), and

(b) the amount must be fixed by means of a determination made by or on behalf of the court in accordance with procedures specified in regulations made by the Lord Chancellor.

(10) Subsection (6) above shall have effect, in relation to any case falling within subsection (1)(a) or (2)(a) above, as if for the words "in the proceedings" there were substituted the words "in or about the defence".

(11) where a person ordered to be retried is acquitted at his retrial, the costs which may be ordered to be paid our of central funds under this section shall include–

(a) any costs which, at the original trial, could have been ordered to be so paid under this section if he had been acquitted; and

(b) if no order was made under this section in respect of his expenses on appeal, any sums for the payment of which such an order could have been made.

16A Legal costs

(1) A defendant's costs order may not require the payment out of central funds of an amount that includes an amount in respect of the accused's legal costs, subject to the following provisions of this section.

(2) Subsection (1) does not apply where condition A, B or C is met.

(3) Condition A is that the accused is an individual and the order is made under–

(a) section 16(1)

(b) section 16(3), or

(c) section 16(4)(a)(ii) or (iii) or (d).

(4) Condition B is that the accused is an individual and the legal costs were incurred in proceedings in a court below which were–

(a) proceedings in a magistrates' court, or

(b) proceedings on an appeal to the Crown Court under section 108 of the Magistrates' Court Act 1980 (right of appeal against conviction or sentence).

(5) Condition C is that the legal costs were incurred in proceedings in the Supreme Court.

(6) the Lord Chancellor may by regulations make provision about exceptions from the prohibition in subsection (1), including–

(a) provision amending this section by adding, modifying or removing an exception, and

(b) provision for an exception to arise where a determination has been made by a person specified in the regulations.

(7) Regulations under subsection (6) may not remove or limit the exception provided by condition C.

(8) where a court makes a defendant's costs order requiring the payment out of central funds of an amount that includes an amount in respect of legal costs, the order must include a statement to that effect.

(9) Where, in a defendant's costs order, a court fixes an amount to be paid out of central funds that includes an amount in respect of legal costs incurred in proceedings in a court other than the Supreme Court, the latter amount must not exceed an amount specified by regulations made by the Lord Chancellor.

(10) In this section–

"legal costs" means fees, charges, disbursements and other amounts payable in respect of advocacy services or litigation services including, in particular, expert witness costs;

"advocacy services" means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right of audience in relation to any proceedings, or contemplated proceedings, to provide;

"expert witness costs" means amounts payable in respect of the services of an expert witness, including amounts payable in connection with attendance by the witness at court or elsewhere;

"litigation services" means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right to conduct litigation in relation to proceedings, or contemplated proceedings, to provide."

12. In summary, section 16 enables the court in question to make a defendant's costs order in the various circumstances identified in subsections (1) to (5). Subsection (6) limits recovery from central funds to sums properly incurred and in an amount that is reasonable. Subsection (6A) allows the court concerned to reduce the costs in given circumstances. But the regime is subject to section 16A. That provision takes away much of what section 16 appears to give. At the time material for the claimant's trials it provided that no legal costs (exhaustively defined in subsection (10)) may be paid unless one of three conditions was satisfied. Condition A covered proceedings in the Magistrates' Court, proceedings in the Crown Court on appeal from the Magistrates' Court and some proceedings in the Court of Appeal. Condition B concerned certain criminal proceedings in the High Court and condition C the Supreme Court. Those exceptions to the "prohibition", as it is described in subsection (6), against ordering costs out of central funds apply to "individuals". The prohibition was all-encompassing so far as non-natural persons were concerned.
13. The effect of these provisions was to deny an acquitted defendant in the Crown Court any possibility of recovering his privately incurred costs from central funds. The context was that there was a blanket entitlement to legal aid in the Crown Court, albeit subject to contributions depending upon means, with the return of those contributions in the event of an acquittal. At that time no individual was denied legal aid; the instruction of lawyers on a private basis was a matter of choice. The position was different in the Magistrates' Court. There was an earnings cap, rather lower than that later introduced for the Crown Court, and recovery of costs pursuant to a defendant's costs order was limited to legal aid rates.
14. As I have noted, from 27 January 2014 an earnings cap was introduced which denies legal aid to some defendants in the Crown Court. This case is not concerned with that cap or the level at which it has been set. At the same time as that change was made section 16A of the 1985 Act was amended to introduce a new condition D:

"(5A) Condition D is that –

(a) the accused is an individual,

(b) the order is made under section 16(2),

(c) the legal costs were incurred in relevant Crown Court proceedings, and

(d) the Director of Legal Aid Casework has made a determination of financial ineligibility in relation to the accused and those proceedings

(and condition D continues to me met if the determination is withdrawn)."

15. It will be recalled that section 16(2) was concerned with proceedings in the Crown Court. "Relevant Crown Court proceedings" is a term later defined. It encompasses cases sent from the Magistrates' Court, cases tried on a voluntary bill of indictment and retrials ordered by the Court of Appeal or Supreme Court (see subsection (11)). Thus from 27 January 2014 a defendant's costs order from central funds once again could be made in the Crown Court following acquittal. Regulation 4A of the Costs in Criminal Cases (General) Regulations 1986 (SI 1986/1335) was inserted by Regulation 5 of the Costs in Criminal Cases (General)(Amendment) Regulations 2012 (SI 2012/1804). Its effect is to limit the recovery of costs under a defendant's costs order in whatever court it is made to legal aid rates.
16. It is now common ground between the parties that contrary to the way in which the case was pleaded, the claimant was at all material times entitled to legal aid. His solicitors do not act under criminal legal aid. Mr Christodoulou has stated that he used the on-line calculator to try to discover whether the claimant could obtain legal aid. His evidence is that the on-line calculator told him not only that the claimant would not have been eligible for legal aid in the Magistrates' Court (which was correct because of the eligibility cap) but that it also said that he was ineligible for legal aid in the Crown Court. Mr Carter has provided evidence on behalf of the Secretary of State that such an outcome was not possible; and he also points to a number of passages in the explanatory material then posted with the eligibility calculator which made it clear that the availability of legal aid in the Crown Court was not affected by means, although any contribution required was. Not unreasonably, he suggests that the eligibility calculator was not a substitute for solicitors making their own judgements in an environment in which those practising in criminal law should know, or by reference to any standard text discover, the correct position. We are not in a position to resolve any dispute about what the on-line calculator had thrown up although I would observe that the documents exhibited by Mr Christodoulou do not evidence a Crown Court assessment, which should have indicated the contribution required. He appears to have mistaken a statement that a "full assessment – not required as initial assessment was decisive" referred to the Crown Court when it was referring to the eligibility for legal aid in the Magistrates' Court. Miss Gerry spoke in broad terms about an error in the calculator giving rise to "procedural irregularity". However, this factual issue can have no bearing on the matters that we are called upon to determine.

The Convention

17. Miss Gerry focussed on article 6 of the Convention. She submits that the statutory provisions denying the claimant the opportunity to recover his reasonable costs give rise to the implication that, despite his acquittal, he is in fact guilty. The statutory regime is thus in conflict with the presumption of innocence guaranteed by article 6. She submits that the change in the costs regime to allow recovery at legal aid rates since 27 January 2014 does not affect that implication. Miss Gerry also submits that the denial of recovery of costs (whether complete or partial) has the practical effect of restricting the right of a defendant in criminal proceedings to choose his representation.
18. As material Article 6 of the Convention provides:

"(2) Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.

(3) Everyone charged with a criminal offence has the following minimum rights:

(c) to defend himself in person or through legal assistance of his own choosing or, if he has not sufficient means to pay for legal assistance, to be given it free when the interests of justice so require."

19. There is a series of decisions of the Strasbourg Court which in my view provide an insuperable obstacle in this case to the submission that a failure to reimburse the legal costs of an acquitted defendant, whether in whole or part, amounts to a violation of article 6 or any other provision of the Convention. The first of note is Masson and Van Zon v Netherlands (1996) 22 EHRR 491. Both applicants were acquitted of serious charges of fraud involving the Dutch civil service pension fund. Each incurred very substantial legal costs in defending themselves and had been detained. They unsuccessfully sought compensation for the detention and reimbursement of their legal costs. The application considered by the Strasbourg Court was concerned with the question whether the claims were dealt with in public by an impartial tribunal. That issue does not arise in the claim before this court. However, in paragraph [49] of its judgment the Strasbourg Court said:

"… the Court observes firstly that the Convention does not grant to a person "charged with a criminal offence" but subsequently acquitted a right either to reimbursement of costs incurred in the course of criminal proceedings against him, however necessary these costs might have been … Such a right can be derived neither from Article 6(2) nor from any other provision of the Convention or its Protocols. It follows that the question whether such a right can be said in any particular case to exist must be answered solely with reference to domestic law."

The statement has been repeated, including in Hussain v United Kingdom (2006) 43 EHRR 22 at paragraph [20]. The Strasbourg Court has stated consistently that the Convention recognises no right to recover costs incurred in a criminal defence.

20. The second decision is Ashenden v United Kingdom (2012) 54 EHRR 13. In this case the Strasbourg Court returned to the question whether a refusal to allow an acquitted defendant his costs could violate article 6(2); the presumption of innocence. The applicants had been acquitted of serious offences but the trial judges refused to make defendant's costs orders in their favour. This was one of a long series of cases brought against the United Kingdom by defendants refused their costs in these circumstances on the basis that they had brought suspicion on themselves or misled the prosecution into believing the case was stronger than it was. The Strasbourg Court reiterated that the presumption of innocence would be impugned if a judge were to suggest that the acquitted defendant was in fact guilty but denying costs on this basis was not incompatible with the presumption of innocence. The Court referred with approval to the passage in Masson quoted above. It then summarised the applicable principles for article 6(2) purposes, which included,

"On the basis of these cases, the Court considers that, in the context of defendants' costs orders, the Convention organs have consistently applied the following principles. First, it is not the Court's role to decide whether a defendant's costs order should have been made in any given case. Secondly, it is not for the Court to determine whether, in granting or refusing such an order, the trial judge has acted compatibly with the relevant Practice Direction … . Thirdly, the Court's task is to consider whether, in refusing to make an order, the trial judge's reasons indicate a reliance on suspicions as to the applicant's innocence after the applicant has been acquitted. Fourthly, the Convention organs have found that it is not incompatible with the presumption of innocence for a trial judge to refuse to make an order because he or she considers that the applicant has brought suspicion on himself and misled the prosecution into believing that the case against him or her was stronger than it was in reality. This will also be the case if the applicant brought the prosecution upon himself because he availed himself of the right to silence. Finally, the refusal to make an order does not amount to a penalty for exercising that right." (paragraph [49])

21. In Masson the claim under article 6(2) had been ruled inadmissible on the facts. The decision in Ashenden shows that if a refusal to reimburse costs following acquittal is accompanied by a statement implying guilt, there may be a violation of article 6(2). But that would not lead to an entitlement under the Convention to the costs is issue.
22. There is no question in this case of the Recorder making any remarks which undermined the claimant's acquittal. On the contrary, he went out of his way to indicate his regret that the statutory provisions made it impossible to make a defendant's costs order in the claimant's favour. It is for that reason that Miss Gerry was driven to submit that the statutory scheme itself casts doubt upon the innocence of individuals in the claimant's position.
23. There is nothing in the language of the statutory provisions which could possibly support the submission that the denial of recovery of costs to acquitted defendants, whether in whole or in part, amounts to an implicit statement by Parliament that it is questioning their innocence. I am unable to accept the submission that the inability to recover the costs should be seen in some way as having left a stain on the claimant's reputation. Miss Gerry invited us to view the costs as a penalty of some sort. But that too is unsustainable, just as it was in Ashenden.
24. The argument relating to restriction of choice proceeds upon the premise that defendants should not be 'forced' to engage lawyers who accept instructions on criminal legal aid by the prospect of lack of recovery of privately incurred costs paid to their lawyers of choice. It is suggested that for many reasons a defendant might wish to engage the services of lawyers who do not accept instructions on legal aid. For example, in cases where the client judges his solicitors and advocates of choice to have expertise in a specialist field not shared by legal aid lawyers or because he has a long-standing relationship with a particular firm in whom he reposes confidence. We do not know whether the claimant would have gone to legal aid solicitors had he been correctly advised that he was eligible. But I am unable to see how this point can assist the claimant's argument. Article 6(3)(c) protects the right of a defendant to defend himself in person or through legal assistance of his own choosing; or if he has insufficient means to do so to be given free legal assistance when the interests of justice so require. In the claimant's case he defended himself with his own lawyers. He exercised the right protected by the Convention. The Strasbourg case law makes plain that the Convention does not in those circumstances guarantee to an acquitted defendant a right to recover the costs of defence. The argument that a hypothetical relatively well-off individual might feel pressured to use legal aid lawyers cannot affect that conclusion. Furthermore, it cannot be said that such a person would be denied a choice just because financial considerations might inform that choice. In any event, there is no evidence to support the contention that this is a real, as opposed to theoretical, problem.
25. Miss Gerry did not press the article 14 discrimination argument orally, nor is it developed in any written material. In essence, it appears to proceed on the apparent imbalance between the costs position of acquitted defendants and the prosecution under the legislative scheme. Section 18 of the 1985 Act allows the Crown Court to award the prosecution its costs against a defendant who has been convicted. The amount must be specified by the Court. As is well known, the CPS works on standard scales for the purposes of most criminal offences when it seeks to recover costs from convicted defendants. The sums claimed are well below commercial rates but not calculated in the same way as legal aid rates. There are circumstances in which a prosecutor can recover his costs from central funds pursuant to section 17 of the 1985 Act. The sums recoverable are not limited to legal aid rates or those which the CPS would seek – see Virgin Media Limited v Zinga [2014] EWCA Crim 1823. The complaint, articulated by Mr Christodoulou in his evidence, is that the prosecuting authorities fare better than the citizen under the legislation.
26. This part of the claim is unsustainable for a number of reasons. Assuming but without deciding that questions of costs recovery fall within the ambit of article 6 for the purposes of article 14 of the Convention it is difficult to see what protected characteristic the claimant relies upon. Furthermore, the prosecutor or state is not an obvious comparator. But whatever the position regarding those aspects of any argument under article 14, there is clear justification for the policies which informed the legislative choices made in both schemes material to the claimant's argument.
27. Changes to the provision of legal aid and the provision of costs from central funds have been on the Government's agenda for many years. For example, Lord Carter published a detailed review of legal aid in 2005. A consultation paper published in November 2008 entitled "The Award of Costs from Central Funds" spoke of the substantial cost to the public purse of costs from central funds and floated various ways by which they might be controlled. In its consultation paper "Transforming Legal Aid – Next Steps" published in September 2013, the Ministry of Justice articulated its justification for (a) denying the recovery of privately incurred costs to defendants in the position of the claimant whose cases were committed or sent for trial between 1 October 2012 and 27 January 2014; and (b) limiting recovery to legal aid rates thereafter:

"80. Since 1 October 2012, defendants in the Crown Court have not been able to claim their private legal costs from Central Funds on acquittal. The reason for this is that at present, every defendant has access to legal aid and so the state will not reimburse a choice to pay privately. In the magistrates' courts, those who are not entitled to legal aid because their income is too high are entitled to reimbursement on acquittal at legal aid rather than private rates. There were a number of reasons for changing the rate of reimbursement from private rates to legal aid rates, including that:

... it is not considered right for the taxpayer to bear significantly greater costs for a privately-paying defendant or appellant than for one who is legally aided;

... if an individual chooses a very expensive private lawyer, we do not believe that the taxpayer should indemnify them simply because the individual was willing to pay more;

... money spent compensating successful defendants at private rates is money that would not be available to provide publicly funded legal services to those most in need of them; and

... capping recoverable legal costs from Central Funds at legal aid rates helps to ensure greater parity between legal aid payments and payments to acquitted defendants from Central Funds. We think that this is fair to the individual and fair to the taxpayer.

81. Our proposal in the consultation was to reintroduce reimbursement (at legal aid rates) to acquitted defendants who apply for, but are no longer entitled, to legal aid in the Crown Court as a result of the threshold. We consider that even though this will cost the public purse it is a fair change to make, given that defendants excluded from legal aid by the threshold will need to pay privately. Ineligible Crown Court defendants will therefore be treated on the same basis as those in the magistrates' courts.

82. However, we do not consider that it is right or necessary to go further and reimburse at full or reasonable private rates for the reasons set out above. The changes to Central Funds have been approved by Parliament in the Legal Aid, Sentencing and Punishment of Offenders Act 2012.

83. Given the continuing challenging fiscal environment, a key objective of the Transforming Legal Aid programme is to deliver savings and we must also be mindful of the risk of reducing the savings expected from the reforms to Central Funds implemented in October 2012"

28. In my judgment, were it necessary for the purposes of article 14 to justify the legislative changes, which first denied and then restricted recovery of privately incurred costs of acquitted defendants, the reasons summarised in this consultation document do so.
29. Section 16A of the 1985 Act was not incompatible with the Convention on account of its failure to enable acquitted defendants in the Crown Court to recover their privately incurred legal costs in cases committed or sent between 1 October 2012 and 27 January 2014; nor is it incompatible in its current iteration (when read with delegated legislation) which limits recovery to legal aid rates.
30. In the light of those conclusions it is unnecessary to determine the question of standing for the claimant to challenge the second period.

The Bill of Rights and a Common Law Power to Award Costs

31. Miss Gerry's short submission is that the costs provisions with which this claim is concerned, albeit in primary legislation, are inconsistent with provisions of the Bill of Rights 1688, itself primary legislation.
32. 1688 saw the departure of James II from the throne and the arrival of William and Mary. The Bill of Rights recited Parliament's grievances concerning the excesses of royal rule. It was an Act declaring the rights and liberties of the subject which the new monarchs acknowledged. It confirmed William and Mary as co-rulers and settled the succession. The various legislative acts of this period cementing the Glorious Revolution are seen as establishing the modern constitutional monarchy. What it did not do was say anything about costs in criminal or other proceedings. In my judgment, no issue arises based upon any apparent contradiction between the Bill of Rights and the 1985 Act.
33. The provision on which the claimant relies recites one of the grievances recited by Parliament:

"Grants of Fines, &c. before Conviction, &c.

And severall Grants and Promises made of Fines and Forfeitures before any Conviction or Judgement against the Persons upon whome the same were to be levyed. All which are utterly directly contrary to the knowne Lawes and Statutes and Freedome of this Realme."

This recital was concerned with fines and forfeiture being levied unlawfully; with the arbitrary abuse of royal power. The Act then provides

"Levying Money.

That levying Money for or to the Use of the Crowne by pretence of Prerogative without Grant of Parlyament for longer time or in other manner then the same is or shall be granted is Illegall."

and later

"Grants of Forfeitures.

That all Grants and Promises of Fines and Forfeitures of particular persons before Conviction are illegall and void."

None of these provisions can be interpreted as being concerned with questions of who should bear the costs of proceedings before the various courts then established in England and Wales.

34. Miss Gerry also submits that the common law should recognise a power to order the payment of defendants' costs not authorised by statute.
35. The payment of costs from public funds in criminal proceedings has always been a matter governed by statute. At common law the Crown was exempt from the payment of costs in all judicial proceedings. Statutory authority was required to enable payment. The question whether costs could be ordered from central funds when not explicitly authorised by statute was considered by the House of Lords in Holden & Co. v CPS (No. 2) [1994] 1 AC 22. The facts were that a number of solicitors had been ordered to pay wasted costs in Crown Courts. The orders had been made by the judge in question on his own motion. The solicitors appealed successfully to the Court of Appeal, Civil Division. That was the correct appeal route. The CPS did not seek to support the orders, which it had not sought. In those circumstances applications were made for costs out of central funds because there was no basis upon which the CPS could be made to pay them. The Court of Appeal made such orders. There was no explicit power to do so in any statutory provision. Instead the Court of Appeal concluded that there was implied power by virtue of section 51(1) of the Supreme Court Act 1981 which at the time provided:

"Subject to the provisions of this or any other Act and to rules of court, the costs of and incidental to all proceedings in the civil division of the Court of Appeal and in the High Court … shall be in the discretion of the court, and the court shall have full power to determine by whom and to what extent the costs are to be paid."

36. The House of Lords held that there could be no such implication. Lord Bridge delivered a speech with which all other members of the committee agreed. He noted the rare circumstances in which words can be read into an Act of Parliament and added at 33E,

"But still more important, in the present context, is the special constitutional convention which jealously safeguards the exclusive control exercised by Parliament over both the levying and the expenditure of the public revenue. It is trite law that nothing less that clear, express and unambiguous language is effective to levy a tax. Scarcely less stringent is the requirement of clear statutory language for public expenditure. As it was put by Viscount Haldane in Auckland Harbour Board v. The King [1924] AC 318, 326:

'It has been a principle of the British Constitution now for more than two centuries … that no money can be taken out of the consolidated Fund into which the revenues of the state have been paid, excepting under a distinct authorisation from Parliament itself.'"

37. After tracing the development of the jurisdiction to award costs out of central funds he expressed himself in agreement with the Court of Appeal that a successful litigant or appellant ought to be able to recover his costs from somewhere, but noted that was not always so. He continued,

"… I hope I have said enough to explain why I cannot attribute to the legislature any general willingness to provide the kind of publicly funded safety net which the judiciary would like to see in respect of costs necessarily and properly incurred by a litigant and not otherwise recoverable. It is for this reason that I find it impossible to say that whenever the legislature gives a right of appeal … in circumstances where a successful appellant may be unable to recover his costs from any other party, that affords sufficient ground to imply a term enabling the court to order the costs to be paid out of public funds. The strictly limited range of the legislation expressly authorising payment of costs out of central funds in criminal proceedings no more lends itself to an extension by judicial implication than does the equally limited range of legislation authorising payment of costs out of the legal aid find in civil proceedings. Some general legislative provision authorising public funding of otherwise irrecoverable costs in all proceedings … would no doubt be an admirable step in the right direction which the judiciary would heartily applaud. But that does not, in my opinion, justify the courts in attempting to achieve some similar result by the piecemeal implication of terms giving power to order payment of costs out of central funds in particular statutes…

The courts must always resist the temptation to engage, under the guise of statutory interpretation, in what is really judicial legislation, but that is particularly important in a sensitive constitutional area, such as that with which we are here concerned, where we should be scrupulous to avoid trespassing on parliamentary ground … I find it difficult to visualise any statutory context in which such a jurisdiction could be conferred by anything less than clear terms." (40D to 41C)

38. Lord Bridge's reasoning applies with even greater force to the claimant's invitation to create a common law right to recover damages from central funds independently of any statute. It amounts to an invitation not just to usurp the function of Parliament but to render a provision in primary legislation redundant by judicial legislation which contradicts it. The claimant appeals to an inherent jurisdiction and asks us to use the common law to "react to unjust decisions of Parliament" founded on a Bill laid before it by Ministers which did not reflect constitutional principles of fairness, balance and justice. In my judgment that is not an appeal to the rule of law but an invitation to subvert it. The constitutional settlement which has its roots in the Glorious Revolution of 1688 rests sovereignty with the Queen in Parliament. The claimant accepts that the terms of section 16A of the 1985 Act are clear in denying him recovery of his costs. The statute must be applied by the courts. There is no basis upon which either this court or the Crown Court could properly contradict the statute by fashioning a common law equivalent of the old section 16 which would enable a defendant in the claimant's position to have his costs from central funds.
39. In my judgment these grounds are unarguable.

Conclusion

40. If my Lord agrees:

i) I would refuse permission to apply for judicial review on the grounds as formulated in paragraph 4(ii) and (iii) above, and discussed between paragraphs [31] and [39];

ii) I would grant permission to apply for judicial review for the purposes of seeking a declaration of incompatibility under section 4 of the Human Rights Act in respect of the statutory scheme as it applied from 27 January 2014 (in addition to the period from 1 October 2012 for which permission was granted on the papers);

iii) I would dismiss the claim for judicial review.

41. The inability of acquitted defendants in the Crown Court to recover (a) any of their privately incurred costs after 1 October 2012, or (b) only to recover their costs at legal aid rates from 27 January 2014, by virtue of section 16A of the 1985 Act is not incompatible with their Convention rights. There is no independent power at common law to order such costs to be paid from central funds.

Mr Justice Goss

42. I agree.