England and Wales High Court (Administrative Court) Decisions

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

		Royal Courts of Justice
		26th October 2017

LORD JUSTICE SALES:

1. This is the hearing of an oral application for permission to apply for judicial review of the "confidence and supply" agreement reached between the Conservative Party and the Democratic Unionist Party of Northern Ireland ("the DUP") dated 26 June 2017. I will call this the confidence and supply agreement.
2. In the General Election held in June 2017 the Conservatives were returned as the party with the largest number of MPs but without an overall majority. In order to be able to form a government which could survive a hostile vote of no confidence in the House of Commons the Prime Minister therefore had to seek political support from another party, in this case the DUP. The confidence and supply agreement was made in order to set out the terms on which the DUP would be willing to provide its support in Parliament for the Prime Minister and her government on motions of confidence and motions for supply of funds for carrying on the business of government. It is set out in a letter jointly signed on behalf of the Conservative Party and the DUP, and is expressed to be intended to operate "to deliver a stable government in the United Kingdom's national interest for the duration of this Parliament." The agreement sets out various points of policy agreement between the parties for the purposes of working together in Parliament.
3. The claim is brought against the First Secretary of State and the Attorney General as representatives of HM Government and the Prime Minister. For the purposes of this hearing the defendants are prepared to accept that the claim is one which is properly targeted against the government as such, as distinct from particular political parties.
4. The claimant is a citizen of Northern Ireland. He is a politician in Northern Ireland who supports and has stood for election to Parliament on behalf of the Green Party of Northern Ireland. No point is taken at this hearing that he lacks standing to seek to bring this challenge.
5. The relief the claimant seeks from the court is a series of declarations essentially to the effect that the decision of the government to enter into the confidence and supply agreement and the further decision of the government to make the spending commitments contained in that agreement are unlawful and could not lawfully be carried into effect. I will call these the relevant decisions. It can be seen at once that the claim seeks to strike at the heart of the political arrangements for the conduct of parliamentary business and for the conduct of government.
6. The claimant at one stage relied on three grounds of claim, but having seen the summary grounds of defence filed by the government he has abandoned the first one, which was based on a contention that the relevant decision is unlawful as being contrary to the Belfast Agreement of 1998 between the government of the UK and the government of the Republic of Ireland, also known as the Good Friday Agreement. He no longer maintains that argument and it is unnecessary to say anything more about it.
7. The claimant just relies on the remaining two grounds of claim:

(1) The claimant says that the confidence and supply agreement will result in expenditure of public funds for improper purposes, namely for the advantage of the Conservatives as a political party.

(2) The claimant says that the confidence and supply agreement is made in violation of the Bribery Act 2010, with the result that the relevant decisions should be quashed as unlawful on that ground as well.

8. In my judgment, neither of these grounds of claim is properly arguable in a court of law. This is a case in which it is clear that permission to apply for judicial review should be refused at this stage because the claim is unsustainable. There is no other basis on which it would be appropriate to grant permission to apply for judicial review.
9. I will deal with each ground in turn.

Ground (1): allegation that there will be use of public expenditure powers for an improper purpose pursuant to the confidence and supply agreement.

10. This ground was added to the grounds of claim by way of amendment, and has undergone some mutation in the course of the proceedings. In my judgment it is unsustainable and reveals no arguable ground of challenge.
11. It is accepted by the defendants, indeed positively submitted by them, that all expenditure of public funds by ministers requires parliamentary authority. That is indeed a fundamental rule of our constitution. Parliament has to vote monies for particular purposes before ministers can spend them. That is why the confidence and supply agreement has two limbs, to ensure that the government has the support of the DUP MPs in Parliament on confidence motions and also to ensure that the government will have the support of the DUP MPs in Parliament on issues of supply, that is to say on issues on which Parliament has to vote that money be provided for public purposes. Ultimately, provision of money has to be authorised in legislation duly passed by Parliament.
12. The mechanism by which money is made available by central government to Northern Ireland, set out in section 58 of the NIA 1998, reflects this constitutional position. Section 58 states,

"The Secretary of State shall from time to time make payments into the Consolidated Fund of Northern Ireland out of money provided by Parliament of such sums as he may determine."

13. What is contemplated by the confidence and supply agreement is that relevant Estimates or supplementary estimates reflecting the expenditure commitments in the agreement will be presented to Parliament and approved by Parliament, ultimately in primary legislation in the form of a relevant Appropriation Act. That process will leave no room for doubt that Parliament has authorised the provision of monies out of central funds for the expenditure referred to in the confidence and supply agreement and in the statements by the government of spending commitments to give effect to that agreement. As the defendants point out, the government is committed to ensuring that any money provided pursuant to the confidence and supply agreement has appropriate parliamentary authorisation. It is not just a question of political commitment. The law also ensures that this will be so. As the defendants say, the confidence and supply agreement "could not, and does not, involve the Government committing itself to any provision of additional funds to Northern Ireland which would not be authorised under standard procedures, including the consent of Parliament."
14. However, Mr Chambers QC, who dealt with this ground of challenge for the claimant, says that this will not be enough. He says that this process will only get the relevant funds into the control of the Secretary of State for Northern Ireland, but that there is an implied limit in section 58 regarding his ability to pass them on to the government of Northern Ireland in accordance with Parliament's intentions and authorisation under the relevant Estimates and Appropriation Act. According to Mr Chambers, it would be unlawful under section 58 for the Secretary of State to pass the relevant funds on to fulfil Parliament's intention as manifested in the relevant Estimates and Appropriate Act. This is because, so it is said, there is a principle of the common law which forbids the Secretary of State from dispensing money to serve party political interests and section 58 does not in terms disapply that principle.
15. In my judgment, this is not an argument with any prospect of success. Neither of the authorities on which Mr Chambers particularly relied in advancing it – the Fire Brigades Union Case [1995] 2 AC 513 and Porter v Magill [2002] 2 AC 357 – supports it. The Fire Brigades Union case concerned a situation in which the Crown's prerogative powers to set tariffs under a criminal injuries compensation system were found to have been impliedly abrogated by the enactment of a statute of 1988 which provided for higher tariff rates, even though it had not yet been brought into effect. The defendant Secretary of State conceded that if that were the case, the approval of spending estimates predicated on the lower prerogative tariffs did not supply lawful authority for those tariffs. But the reason for that was that the directly relevant statute, the 1988 Act, had removed any prerogative power to implement lower tariffs and the approval of spending estimates did not trump the 1988 Act's abrogation of such power. That is an entirely different context from the present one. The case does not offer support for Mr Chambers' submission that there is some principle of the common law which governs expenditure of money by central government when using funds voted by Parliament for the relevant purpose.
16. Similarly, Porter v Magill provides no support for any such supposed common law principle or impediment. That case concerned the exercise of powers conferred on a decision-maker by an Act of Parliament. The House of Lords confirmed the general principle of public law that powers conferred on a public authority may only be exercised for the purpose for which those powers were conferred and not otherwise. The powers in issue in the case were statutory powers for the sale of council houses by a council, which had been exercised for the improper purpose, unauthorised by the statute, of promoting the electoral advantage of a political party: see [19] per Lord Bingham and also the reference to "municipal powers" by Lord Scott at [132]. The limits on the proper purposes for which the powers could be used were derived from the statute itself, on its proper interpretation. In the exercise of interpretation there was no reference made to any common law principle of a kind which Mr Chambers asserts in this case.
17. In my judgment, there is no arguable case for the claimant that the Secretary of State's powers under section 58 of payment on of monies voted by Parliament for use in Northern Ireland pursuant to the confidence and supply agreement are subject to any limit derived from any principle of the common law as is asserted by Mr Chambers, and therefore there was no need for section 58 to say anything to exclude the operation of any such principle. In my view the claimant has no arguable claim that section 58 contains any relevant limit which would render unlawful the implementation of the spending commitments in relation to Northern Ireland set out in the confidence and supply agreement. Where Parliament has itself approved the provision of monies out of central funds under the process of Estimates and enactment of Appropriation Acts I have described for the purpose of providing those funds to the government in Northern Ireland pursuant to those spending commitments, it is plain that section 58 authorises and allows the Secretary of State to pay those monies on as Parliament intended. There would be no unlawfulness involved.
18. At some points in his submissions Mr Chambers seemed to rely on Porter v Magill in support of a wider argument, that MPs from the DUP and the Conservative Party would be acting unlawfully if they voted in Parliament on Estimates and an Appropriation Act designed to give effect to the confidence and supply agreement. But I do not consider that Porter v Magill offers any support at all for such a wide-ranging and radical submission. DUP MPs would be acting perfectly properly if they decide to vote in accordance with the confidence and supply agreement, as an agreement which provides for the creation of a stable government and for the provision of more funding for the benefit of their constituents. MPs are fully entitled to make those sorts of judgments. The same is true for Conservative MPs, who will presumably believe that it is in the interests of the country and their constituents to have a stable and Conservative government. Unlike the council in Porter v Magill, no MP in our case would be exercising any powers conferred on them by statute, which would be subject to express or implied limits like the statutory powers in that case. Porter v Magill has no arguable bearing on the different issues and in the different context in which the present claim is brought. The relevant decisions in our case go to the issue of how voting rights of MPs will be exercised in Parliament. Unlike in Porter v Magill, those voting rights are not statutory powers subject to a statutory obligation that they be exercised without regard to party advantage. The voting rights of MPs are used to enact statutes and hence to impose statutory duties. They are not the subject of statutory duties themselves. Moreover, it is abundantly clear under our constitution that the voting rights of MPs can perfectly legitimately be exercised having regard to party advantage. Indeed, that is how they regularly are exercised day in day out in the conduct of business in Parliament.
19. If and when MPs from the Conservative Party and from the DUP vote in favour of allocation of funds to fulfil the policy commitments set out in the confidence and supply agreement - and assuming they succeed in passing the relevant motions and enacting the relevant legislation – the enactments under which the money is voted will carry the legal authorisation which permits that money to be spent lawfully to implement the political commitments which have been made.
20. In my judgment, the making of the confidence and supply agreement and the announcement of spending commitments are political acts which cannot be challenged, declared unlawful or struck down in a court of law. On the one hand, the claimant has no valid claim in law to impugn the way in which MPs in both parties propose to vote to give effect to them. On the other hand, it can also be seen that once they have voted so that Parliament authorises the expenditure in line with the commitments in the agreement, the claimant will have no valid claim in law to say that the expenditure is unlawful.
21. The claimant says that the government had an illegitimate conflict of interest when it made the relevant decisions to enter into the confidence and supply agreement and to announce spending commitments in accordance with it. In my view this is not remotely arguable as a contention of law. In this political context there is no relevant standard of impartiality or disinterestedness which has been breached. The confidence and supply agreement is a political agreement made in a context where some form of political agreement was inevitable and indeed required if a stable government was to be formed. All political parties seek to promote particular interests and particular interested points of view. That is the nature of the political process, and the disciplines to which they are subject are the usual political ones of needing to be able to command majorities in the House of Commons on important votes and of seeking re-election at the appropriate time. The law does not super-impose additional standards which would make the political process unworkable.
22. I also agree with the further answer to this ground of claim which the defendants have put forward. That answer is that in any event this ground of claim is non-justiciable in this court for a further distinct reason. The confidence and supply agreement is directed to securing support from the DUP for the government when voting in Parliament. It is well-established that parliamentary privilege would prevent a court from reviewing what is done in Parliament by way of voting: see e.g. R (Wheeler) v Prime Minister [2008] EWHC 1409 (Admin), DC, in particular at [49]. The same principle of parliamentary privilege prevents a court from inquiring whether MPs are acting to vote in implementation of a confidence and supply agreement such as this. Not only does the confidence and supply agreement cover how the DUP MPs will vote in Parliament on confidence and supply motions – hence the name – it also covers how the Conservative party MPs will vote in Parliament to give effect to those elements of the quid pro quo which require expenditure of money, which will have to be voted by Parliament. The claimant's claim in respect of the relevant decision cannot be separated out from an attack on proposals as to how MPs in both parties should vote in Parliament, which is the main object and effect of the agreement in issue.

Ground (2): The Bribery Act 2010

23. The claimant contends that it is arguable that the arrangements in the present case involve the commission of an offence under the Bribery Act 2010 and, further, that it is appropriate for that matter to be resolved by way of a claim for judicial review.
24. The relevant provisions of the 2010 Act for present purposes provide as follows.

"1 Offences of bribing another person

(1) A person ("P") is guilty of an offence if either of the following cases applies.

(2) Case 1 is where—

(a) P offers, promises or gives a financial or other advantage to another person, and

(b) P intends the advantage—

(i) to induce a person to perform improperly a relevant function or activity, or

(ii) to reward a person for the improper performance of such a function or activity.

(3) Case 2 is where—

(a) P offers, promises or gives a financial or other advantage to another person, and

(b) P knows or believes that the acceptance of the advantage would itself constitute the improper performance of a relevant function or activity.

(4) In case 1 it does not matter whether the person to whom the advantage is offered, promised or given is the same person as the person who is to perform, or has performed, the function or activity concerned.

(5) In cases 1 and 2 it does not matter whether the advantage is offered, promised or given by P directly or through a third party."

25. "A relevant function or activity" is defined in section 3 of the Act as follows:

"3 Function or activity to which bribe relates

(1) For the purposes of this Act a function or activity is a relevant function or activity if—

(a) it falls within subsection (2), and

(b) meets one or more of conditions A to C.

(2) The following functions and activities fall within this subsection—

(a) any function of a public nature,

(b) any activity connected with a business,

(c) any activity performed in the course of a person's employment,

(d) any activity performed by or on behalf of a body of persons (whether corporate or unincorporate).

(3) Condition A is that a person performing the function or activity is expected to perform it in good faith.

(4) Condition B is that a person performing the function or activity is expected to perform it impartially.

(5) Condition C is that a person performing the function or activity is in a position of trust by virtue of performing it.

(6) A function or activity is a relevant function or activity even if it—

(a) has no connection with the United Kingdom, and

(b) is performed in a country or territory outside the United Kingdom.

(7) In this section "business" includes trade or profession."

26. Section 4 of the Act provides that a relevant function or activity "is performed improperly if it is performed in breach of a relevant expectation". In relation to cases falling within condition A or B, the relevant expectation is that inherent in the condition itself. In relation to condition C, the expectation means "any expectation as to the manner in which, or the reasons for which, the function will be exercised". Section 5 of the Act provides that the test of what is expected is a test of what a reasonable person would expect in relation to the performance of the relevant function or activity.
27. In summary, therefore, it will be a criminal offence for a person to offer or promise, or to give, a financial or other advantage to another where the person intends that advantage to induce the other person to perform a relevant function improperly, that is, in breach of a relevant expectation.
28. The claimant contends in the present case that Her Majesty's Government has offered or promised or provided a financial or other advantage to the DUP MPs. That advantage is said to be (1) the financial support that HMG is prepared to make available to Northern Ireland or (2) the participation of DUP MPs in the co-ordination committee provided for by the confidence and supply agreement between the Conservative Party and the DUP. It is said that those advantages are intended to influence the way in which the DUP MPs will vote on certain issues in the House of Commons. Voting is said to be the "relevant activity" for the purposes of section 3 of the Act. Finally, the claimant contends that that would involve the DUP MPs violating one or more of conditions A to C as they are expected to act in good faith and to act impartially, and voting in accordance with the confidence and supply agreement would breach those expectations; or they are in a position of trust and voting in that way breaches the expectation attached to that that position of trust.
29. In my judgment, and as a minimum, there is no arguable case here that MPs would be acting improperly by reference to any one of the three conditions set out in section 3 of the 2010 Act. First, DUP MPs would not be acting improperly in the sense of acting in bad faith within condition A or in breach of any duty to act impartially within condition B if they were to vote in accordance with the agreement.
30. It is for each MP to act, and vote, as he or she considers right in the interests of their constituents and the country more generally. In doing that they are obviously entitled to have regard to advantages which may accrue for their constituents. In this case, by adhering to the confidence and supply agreement the DUP MPs seek to secure stable government and financial benefits for Northern Ireland their constituents. MPs are also entitled to have regard to party advantage and the party line. It is by acting as part of a political party that MPs are able to engage in coherent and effective political activity. Also, in an important sense it is by acting as part of a political party that they are open to being held accountable to the electorate. The confidence and supply agreement reflects the arrangements that the Conservative Party and the DUP consider appropriate to ensure that the current government is able to maintain a majority in the House of Commons and is able to ensure the passage of the financial measures considered necessary to enable the government to function. The financial measures in question include such fundamental things as the Budget, money and finance bills, and supply and appropriation legislation and estimates. A DUP MP who votes in accordance with that agreement, or in support of the provision of particular financial support to Northern Ireland, is not acting in bad faith and is not violating any duty to act impartially within the meaning of section 3 of the 2010 Act. An MP who behaves in this way does not go against any expectation of reasonable people in the UK. On the contrary, he or she would be acting in line with the expectation of reasonable people in the UK. That is precisely how parliamentary politics is supposed to work.
31. The claimant submits that the following considerations establish that it is arguable that doing so would involve an MP acting improperly. First, so far as Condition A is concerned, the claimant contends that there is an expectation that MPs would not vote for the purpose of complying with the confidence and supply agreement as the agreement is one that involves expenditure for an improper purpose applying the principles in Porter v Magill. The premise underlying this submission is that the confidence and supply agreement, in some way, involves unlawful conduct. For the reasons already given, I do not consider that the operation of the agreement would involve any breach of the principles in Porter v Magill. There is, therefore, no basis for contending that voting in accordance with the confidence and supply agreement would involve a breach of any relevant expectation as to how MPs should vote when performing their functions in good faith.
32. Secondly, so far as Condition B is concerned, the claimant submits that there is an expectation that MPs will act impartially and will not be influenced by payment of a bribe as defined in paragraph 12 of the Code of Conduct for Members of Parliament. That paragraph provides that the acceptance by an MP of a bribe to influence his or her conduct as a member, including the receipt of any fee, compensation or reward, is contrary to the law of Parliament.
33. I am doubtful that that Code is an admissible guide to the meaning of section 3 of the 2010 Act. I note that paragraph 12 of the Code refers to the law of Parliament and paragraph 17 of the Code provides that the application of the Code is a matter for the House of Commons.
34. In any event, however, I do not consider that it is reasonably arguable that the situation which appears to be envisaged in paragraph 12 of the Code – that is to say, a situation which involves the acceptance by an MP of a personal inducement to vote in a particular way - in any way indicates that an MP who votes in accordance with a confidence and supply agreement, or whose constituents may benefit from the provision of financial support to Northern Ireland, is in breach of any duty to act impartially derived from the Code.
35. In fact, Mr Cooper QC, who presented the argument for the claimant on this ground of challenge, agreed that it depends upon the claimant being correct on his argument based on Porter v Magill under the first ground of challenge. Since the claimant has no arguable challenge under the first ground, for the reasons I have already given, so also he can have none on proper analysis under the second ground.
36. Thirdly, Condition C requires that the person performing the function or activity - here the MP voting in the House of Commons - be "in a position of trust by virtue of performing it" and that there be a breach of an expectation as to the manner or reasons for which the function is performed. In my judgment, those words do not arguably apply to a situation where an MP votes in the House of Commons. That is not a position of trust arising by virtue of the fact that the MP is voting. Furthermore, as I have already observed, there is no expectation that the function or activity of voting will not be influenced by the confidence and supply agreement. In this regard, the claimant contends again that there is a relevant expectation that DUP MPs will vote in the House of Commons for lawful reasons and will not vote by reference to an agreement which is said to be unlawful applying the principles in Porter v Magill. Again, for the reasons already given, I do not consider that the making or implementation of the confidence and supply agreement would involve any breach of the principles in Porter v Magill. There is, therefore, no basis for contending that voting in accordance with the agreement would involve any breach of any expectation as to how, or for what reasons, an MP may vote.
37. For those reasons, it is clear that voting in the House of Commons in accordance with the confidence and supply agreement would not fall within any of Conditions A, B or C set out in section 3 of the Act, without needing to say anything more about other difficulties which might lie in the claimant's path so far as this ground of claim is concerned. It would not involve any breach of any expectation of good faith on the part of the Member of Parliament. It would not involve any breach of any duty to act impartially in the sense provided for by section 3 of the 2010 Act. The situation does not involve a position of trust arising by virtue of the fact that the MP votes in the House of Commons. Nor does voting in accordance with the confidence and supply agreement involve the breach of any expectation as to how or for what reasons an MP will vote. For these reasons alone, if for no others, as a matter of law the offences of bribery set out in the 2010 Act can have no application to the making of the confidence and supply agreement or its operation.
38. In those circumstances, I do not need to consider further the question of whether voting in Parliament is a function of a public nature in the sense that that phrase is used in section 3(2)(A) of the 2010 Act. I can see there might be arguments on both sides of a debate about that question.
39. I think it is appropriate to mention here that judicial review is not normally an appropriate method of determining whether or not a particular course of conduct would involve the commission of a criminal offence. However, as it is clear on any analysis of the law that the making and implementation of the confidence and supply agreement in this case would not involve the commission of any offence under the 2010 Act, it is appropriate simply to refuse permission on the basis that this ground is unarguable, rather than on the ground that the matter is better tested in criminal proceedings. If it had been arguable that, as a matter of law, certain conduct might, depending on the circumstances, have involved the commission of an offence, then judicial review would have been unlikely to be an appropriate means of resolving the issue.
40. For those reasons, the claim that voting by MPs in the House of Commons in accordance with the confidence and supply agreement or participating in a co-ordinating committee to facilitate voting in according with the arrangements for confidence and supply might involve the commission of an offence under the 2010 Act is unarguable and permission to apply for judicial review on this ground also is refused.

Conclusion

41. For the reasons I have given, I would refuse to grant permission to apply for judicial review in this case.

MR JUSTICE LEWIS:

42. I agree.

LORD JUSTICE SALES: Yes, Mr Coppel.

MR COPPEL: My Lords, we have an application for costs. First of all, the costs for preparing the acknowledgment of service we applied in para.39 summary 39 of the summary grounds for those cost to be assessed if not agreed on normal principles. In addition, we also----

LORD JUSTICE SALES: Sorry, you say "on normal principles", why would we not do a summary assessment?

MR COPPEL: I am sorry. We applied on the basis of the principle that the defendant is normally entitled in the event that permission is refused. We have not seen a schedule----

LORD JUSTICE SALES: Why not? I mean, this was always a hearing for less than a day. Ordinarily, the court would expect to assess costs summarily in such a case.

MR COPPEL: Well, my Lord, my next application or the next part of my application is for the costs of today. What we say in relation to that is that although it would not be a usual order for the costs of an oral permission hearing to be awarded to the successful defendant that there are features of this case which would justify that order.

Three, in particular:

Firstly, this has not been a permission hearing in the usual form, 30 minutes in the Administrative Court list. The claimant has had the opportunity to submit full argument over the course of a full day of court time and this has effectively been an early substantive hearing.

Secondly, on the grounds of the weakness of the claim, which has been held to be unsustainable at every turn. The claimant has persisted to this hearing despite being alerted to the reasons as to why the claim had no prospect of success from an early stage in pre action correspondence.

So far as the improper purpose point is concerned the claimant had originally submitted in amended grounds that the Government had acted unlawfully by committing funds without Parliamentary authority, para.12(b) onwards of the summary grounds. When the claimant was then informed that that was not the facts of the case and that the Government intended in the usual way to seek Parliamentary authority it did not drop that point as one might have expected but persisted with the arguments which you have heard from Mr Chambers and have been rejected.

Secondly, in relation to the Bribery Act, the defendant has also pointed out from the stage of pre-action correspondence that there is nothing, there could be nothing improper in the DUP MPs voting in accordance with a prior agreement to support the Government: but again, the claimant has persisted with that argument throughout.

LORD JUSTICE SALES: On this part of your costs application, what test are we applying. Do we get any assistance from authority, what test should we apply?

MR COPPEL: On Mount Cook principles, the usual judicial review principles, the defendant is generally entitled to the costs of an acknowledgment of service.

LORD JUSTICE SALES: Yes.

MR COPPEL: Not generally entitled to the costs of an oral permission hearing.

LORD JUSTICE SALES: Yes.

MR COPPEL: But the White Book at 4.12.5 or the navy textbook, which assists.

LORD JUSTICE SALES: Sorry, which page of the White Book?

MR COPPEL: My Lord, I do not have the page in front of me, it is 54.12.5.

LORD JUSTICE SALES: Thank you.

MR CHAMBERS: Page 1947, my Lord.

LORD JUSTICE SALES: Thank you very much.

LORD JUSTICE SALES: Sorry, I am reading through this but can you help me. Where do I get the principle that we should be applying?

MR COPPEL: The principle from the Mount Cook case is said to be: "The court should not order an unsuccessful claimant to pay the costs of (indistinct) attending an oral hearing and successfully resisting an application for permission except in exceptional circumstances and such circumstances may consist in [...]" and then there are a number of factors.

LORD JUSTICE SALES: Yes, thank you.

MR COPPEL: A hopelessness of the claim and persistence by the claimant that they are, having been alerted to the facts or demonstrating it, hopelessness, and I apply for those. The extent to which the court has sought to adduce the process of the court, I am not saying that, but:

"D, whether as a result of full argument of [...] this claimant has had the advantage of an early substantive hearing," that is the point I have just been making.

My third point is the point that immediately follows that in the White Book which is that this is litigation which benefits from substantial funding, over £90,000 on the last explanation of the website has been crowd funded to support this litigation.

LORD JUSTICE SALES: I am not sure that that is identified as a relevant factor is it?

MR COPPEL: The White Book goes on to say that the court would also consider.

LORD JUSTICE SALES: Oh yes, "has substantial resources".

MR COPPEL: The resources of the claimant. And, as I say, there are substantial resources are backing this claim from individuals who no doubt saw its political potential. Given those funds and those funds have been donated, we say that it would not be fair for the tax payer to have to bear the cost burden with the claimant for unsuccessfully defending it seeing as it is in accordance with arguments which have been with the claimant for many, many weeks and months.

LORD JUSTICE SALES: Yes.

MR COPPEL: So for all those reasons we seek an order for our costs on the proceedings to be assessed if not agreed.

LORD JUSTICE SALES: All right and again in this part of the case why no summary … schedule for a summary agreement?

MR COPPEL: We do not have a schedule, my Lord. I am sorry for the inconvenience. I cannot say that it was not in our resource to do it.

LORD JUSTICE SALES: I agree, yes. It is not just inconvenient, it also means costs being incurred further down the system. The whole point of having summary assessment of costs is that the court can deal with it then and there without court resources being taken up by argument potentially about quantum of costs later.

Anyway, you cannot help us further.

MR COPPEL: My Lord, I cannot help you further.

LORD JUSTICE SALES: It is just an omission by the Government Legal Department.

MR COPPEL: (Nods).

LORD JUSTICE SALES: Yes.

MR CHAMBERS: My Lord, I resist that application for costs both in relation to the acknowledgment of service and the costs of today.

LORD JUSTICE SALES: Yes.

MR CHAMBERS: On the fourth ground that this claim has been brought in the public interest. Could I deal first of all with the costs of today. My learned friends in their skeleton at the final paragraph at para.22 say that if the court refuses permission the defendants apply for their costs of preparing the acknowledgment of service in accordance with Mount Cook and they seek an order for costs in the sum to be assessed if not agreed.

There was no indication in the skeleton that they were going to ask for the costs of today. If they had done so, they could have done so on the basis of the argument that my learned friend has just put forward. His essential point is that this is a hopeless claim "and therefore we come within the exception to Mount Cook".

LORD JUSTICE SALES: Are they are not entitled to hear what the court makes of the challenge, I mean he has not said "no other claim for costs will be made", has he?

MR CHAMBERS: My Lord, of course he is, but one would have expected some sort of flag because he would be relying on an exception.

LORD JUSTICE SALES: Quite.

MR CHAMBERS: That is the first point. My Lord, the second point is so far as the day's hearing is concerned of course that was ordered by the court for a one day hearing so this was not us who has procured a one day hearing it was suggested by the court itself.

MR JUSTICE LEWIS: The problem is that that works against you: when it is a rolled up hearing you normally do award costs if the claimant loses. This is not rolled up hearing but you knew from the order of Supperstone J that this was going to be inter partes hearing so you knew that in reality they had to incur the costs and they had to be here.

MR CHAMBERS: My Lord, yes. I fully accept that, my Lord. Could I move to the wider point about the public interest?

LORD JUSTICE SALES: Yes.

MR CHAMBERS: Which actually covers both of my grounds for today and the acknowledgment of service. Could I just hand up to your Lordships, if I may, a very short extract from Michael Fordham QC's book on judicial review? The reason I do that is because he has collected together very handily some examples of cases where the public interest is dealt with and it is paragraph 18.3. (Handed)

LORD JUSTICE SALES: Yes.

MR CHAMBERS: "The public interest is well recognised as influencing costs of judicial review. The courts can decide in appropriate cases the claimants:

1) The claimants should have early certainty they will be responsible for no or capped costs.

Or:

2) Should not face cost orders when their claims have failed."

MR JUSTICE LEWIS: The first one deals with cost capping orders, protective costs orders.

MR CHAMBERS: My Lord, yes. What he is saying in No. 1 is no orders, or capped costs and, in 2, he is saying no cost orders at all where the claim has failed.

MR JUSTICE LEWIS: All right.

MR CHAMBERS: The reason I draw this to your Lordship's attention is really 18.3.2.

LORD JUSTICE SALES: Yes.

MR CHAMBERS: Which just gives a collection of the sorts of cases where no costs have been ordered, even although the claimant has failed on the basis of public interest.

The first one:

"David Aylesbury, in contrast with judicial review claim or wholly or any commercial or proprietary reasons, a claim brought partly or wholly in the public interest albeit unsuccessful may properly result in restricted or no order for costs."

So, my Lord, that is the general point I make and what the specific points I make are first of all that this case did raise significant issues of public interest which were of general importance because it is the first time that a coalition or a Confidence and Supply Agreement in the UK has made provision for a very substantial expenditure and this did cause significant concern to a number of different people across a wide spectrum of the population.

It was therefore right, we submit, that the issues raised were brought before the court to obtain a ruling on the legality of spending commitments and the court's judgment is, if I may say so with respect very clear and it will undoubtedly set a number of minds at rest, particularly people who were worried or concerned about the expenditure.

Also, my Lords, it would be important and it important to the political community generally, and of course it is going to be important to future political parties in terms of their future negotiations for such agreement.

So the court has pronounced very clearly if I may respectfully say so, issues which are of importance, real importance to a number of different people, my Lord.

My Lord, two other points:

First of all, as things currently stand there is no authority for the expenditure in the agreement and the agreement of course did not say anything about that and of course what these proceedings have done is flush that point out.

LORD JUSTICE SALES: Sorry, you say as things currently stand there is no Parliamentary authority. We did not look at that in the end because you said that your challenge really arose, whether or not there was not in the current ...

MR CHAMBERS: Indeed, but as a matter of fact it is accepted on all sides.

LORD JUSTICE SALES: All right.

MR CHAMBERS: Yet, no mandatory authority and that point was "flushed out" if may put it that way in these proceedings.

LORD JUSTICE SALES: Right.

MR CHAMBERS: My Lord, finally on this we have proposed ...

LORD JUSTICE SALES: Sorry, just on that, you say that is now common ground. Could you just point me to somewhere in the Government's pleading or skeleton where they accept that.

MR CHAMBERS: Well, my understanding is what is said is that this is going to be done through the estimates' process.

LORD JUSTICE SALES: Right.

MR CHAMBERS: There has been no estimates' process since the main estimate.

Therefore, unless my learned friend tells me differently my understanding is there is at the moment no approval through the estimates process for this failing, is that right?

MR COPPEL: There is not and there is a statement.

LORD JUSTICE SALES: There is not, did you say?

MR COPPEL: I am sorry. There is a written ministerial statement from the Secretary of State for Northern Ireland in the bundle to the effect that the additional sums which are set out in the agreement have not been included in this process as a process, so that is correct what Mr Chambers has said.

LORD JUSTICE SALES: All right. Did you say that that was a matter of a ministerial statement? Sorry, if it has been said these proceedings … before, the suggestion by Mr Chambers was that before these proceedings the point was unclear that they there would have to be a further estimates' process before the monies could be supplied but you are, as I understand it, you are saying actually there is a ministerial statement saying that.

MR COPPEL: Yes.

LORD JUSTICE SALES: He did not need these proceedings, is that right?

MR COPPEL: Yes, sorry.

LORD JUSTICE SALES: That was not issued in consequence of these proceedings, or was it?

MR COPPEL: No, that was not in consequence of these proceedings. So I certainly do say it was clear before today but I would also say that the court has not dealt with (and we have not made submissions) on the question of whether it is permissible to use monies which have already been voted for Northern Ireland in advance of a specific estimates' process relating to the agreement.

LORD JUSTICE SALES: Right.

MR COPPEL: That was something we did not get into, we did not need to but I would not like it to go unsaid that we have not had the argument and we do not necessarily agree that it is not permissible to do that.

LORD JUSTICE SALES: Yes. Thank you. Mr Chambers.

MR CHAMBERS: My Lord, the point I was making was what the Government have said is that these spending commitments can be authorised in the point of view in a way for the estimates' process.

LORD JUSTICE SALES: Yes.

MR CHAMBERS: My Lords, he has not yet been through the estimates' process.

The ministerial statement my learned friend refers to simply says that the additional spending was not covered by the 2017 estimates, the current estimates, and that is as far as it goes.

LORD JUSTICE SALES: Right, yes. Thank you.

MR CHAMBERS: My Lord, the final point is we have proposed since the early stages of these proceedings that each party bear their own costs of these proceedings. That was not accepted by the Government on the basis that they wanted to hear what the result of the permission hearing was. But my point is by inviting the court to make no orders as to costs we are departing from the suggestion we have made all along, that each party should bear their own costs.

MR JUSTICE LEWIS: So you knew, despite what you said about the skeleton, you knew that their position was that they might ask for their costs at the end of the hearing?

MR CHAMBERS: My Lord, no, because the skeleton argument simply confines it to the costs of the acknowledgment of service.

MR JUSTICE LEWIS: Yes.

MR CHAMBERS: Rather than the costs.

MR JUSTICE LEWIS: They did not refer to the costs of the hearing but you just told me, I thought, that you had asked them to have an arrangement there would be no order for costs and they said no, they wanted to see what would happen at the end of the hearing.

MR CHAMBERS: Yes. My Lord, our proposal was no order for costs for the entire proceedings.

LORD JUSTICE SALES: No, I understand that.

MR CHAMBERS: Yes.

MR JUSTICE LEWIS: My point is a different one. You started off by saying that it is not appropriate to award costs because there was no indication that they had asked for costs, look at their skeleton. And you hinted, or implied that this therefore would be unfair to you but it seems that that is not the correct, full position because you had raised the question of no order for costs. And, from what you have just told me, unless I misunderstand, they had said: "No, no, no we are not going to agree to rule out any claim for costs, including costs of the hearing. We want to see what happened."

MR CHAMBERS: My Lord, we can look at the correspondence but my understanding was back in July we suggested no order as to costs and the Government basically----

LORD JUSTICE SALES: Yes, and what did they say?

MR CHAMBERS: They said we will wait until permission was decided, this was in the context of our application for the cost cap.

LORD JUSTICE SALES: That sounds as though in correspondence they were indicating the costs would be at large.

MR CHAMBERS: My Lord, yes, they were but the application for costs in the submissions on cost in the skeleton argument are restricted to the acknowledgment of service.

LORD JUSTICE SALES: Right, yes.

MR CHAMBERS: I was making a slightly different point, my Lord, which was simply the costs order I was seeking is no different from what I have been seeking throughout, my Lord.

LORD JUSTICE SALES: No, thank you.

MR CHAMBERS: My Lord, those are my submissions.

LORD JUSTICE SALES: Thank you. Yes, Mr Coppel, anything from the defendant?

MR COPPEL: Just two short points. In terms of the correspondence, we did write a letter on 13^th October on the question of costs, saying that should the court refuse permission following the hearing of 26^th October, then the defendants will ask the court to make an order of the costs incurred in relation the permission hearing.

So that was, it was our position was clear on the correspondence in relation to that.

LORD JUSTICE SALES: Could you just give us the bundle reference for that, so we have it.

MR COPPEL: It is in the bundle of 13^th October.

MR CHAMBERS: My Lord, p.151.

LORD JUSTICE SALES: Which bundle, 1?

MR CHAMBERS: Bundle 1.

MR JUSTICE LEWIS: That was on 13^th October.

LORD JUSTICE SALES: It is a bit curious that the skeleton argument on the 19^th October then restricted the claim for costs. What was the reasoning behind that?

MR COPPEL: I do not know.

LORD JUSTICE SALES: What: the left hand not knowing what the right hand was doing.

MR COPPEL: Lost in translation.

LORD JUSTICE SALES: All right.

MR COPPEL: But the point is that it is if the allegation is the claimants were taken by surprise, then the correspondence answered that.

LORD JUSTICE SALES: Yes.

MR COPPEL: The only other point I would make is we did not get into the argument on this because you do did not call on Mr Eadie but we certainly do not accept that this was a uniquely interesting case which raised a unique agreement.

There are, as we put our skeleton, many examples or previous agreements, including the last coalition agreement which entailed considerable further expenditure of public funds on particular policies which were agreed between the parties as set out in that agreement. There was nothing unique about this. That was an incorrect legal proposition based on Mr Chambers' incorrect legal argument as expressed below. It is not the standard feature of the political landscape and has been blown out of all proportion, we would say.

LORD JUSTICE SALES: Yes, thank you. Well, I think we will rise for a few minutes to consider what to do about this.

(A short adjournment)

…

LORD JUSTICE SALES:

43. The defendants make an application for payment of their costs of preparing the acknowledgment of service and their costs for attendance at the oral permission hearing today. The usual position according to the Mount Cook principles is that the costs of preparing the acknowledgment of service would be awarded in the defendant's favour.
44. In relation to the costs of the oral permission hearing, the background is that the court directed that there be a one day inter partes hearing. So the claimant has known since then that this was a case outside the usual run of permission applications.
45. In a letter dated 13^th October, the Government Legal Department put the claimant on notice that the defendants would be seeking their costs in relation to the permission hearing if they were successful. It is fair to point out that in the defendant's skeleton argument they said only that the costs of preparing the acknowledgment of service would be sought without referring more widely to the cost of the permission hearing itself. But in my view, against the background the letter of 13^th October, nothing said in the skeleton argument purported to tie the Government's hands as to the costs orders that it would seek. The Government gave no undertaking not to seek whatever costs it thought might be justified by application at the end of the hearing and in my view the skeleton argument could not be fairly relied upon as indicating a clear departure from the general position set out in the letter of 13^th October.
46. The costs of a defendant in relation to an oral permission hearing are ordinarily not allowed unless exceptional circumstances apply, judged by reference to factors set out in the Mount Cook case.
47. In my view, this is a case where exceptional circumstances apply. First, as appears from the judgment, I consider that this was a hopeless claim on both the grounds put forward.
48. Secondly, the claimant persisted with this hopeless claim even although the clear flaws in it were pointed out in correspondence by the defendants.
49. Thirdly, the claimant has had the benefit of an unusually long inter partes hearing at the permission stage involving a full exploration of arguments both orally and in writing on the part of the claimants and in writing and potentially orally, if they had been called upon, by the defendants.
50. These factors in combination in my view mean that this is an exceptional case where, subject to a final argument advanced by Mr Chambers, it would be appropriate to award the defendants their costs of the permission hearing.
51. The final argument raised by Mr Chambers is that neither element of the costs should be awarded in favour of the defendants because of the public interest of the points in issue on this claim. However, it is only in exceptional circumstances that courts have very occasionally declined to award costs which would otherwise be found to be due, on the basis that a judicial review claim has raised issues of general public importance.
52. In my view, there is an inter-relationship here between the merits of a claim and an assessment of the public interest. As I have indicated this was a hopeless claim. It was not one which raised real arguments of law which it was in the public interest to have ventilated in court proceedings.
53. In my judgment, this is not a claim in relation to which it is appropriate for the burden in costs to be borne by the taxpayer. It is not an exceptional case such as would justify a refusal to award costs in favour of the defendants which would otherwise on ordinary principles be awarded in their favour.
54. For these reasons I would award the defendants their costs of preparing the acknowledgment of service and their costs of the oral permission hearing.

MR JUSTICE LEWIS:

55. I agree.

…

LORD JUSTICE SALES: Yes. Is there anything else? Could I invite the parties, please, to drawn up an order which can be agreed between them and passed to the associate?

Thank you very much everyone for their assistance, both orally and in writing. We will rise now. Thank you.

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