England and Wales High Court (Administrative Court) Decisions

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

		Royal Courts of Justice Strand London WC2A 2LL
		7th February 2017

1. THE DEPUTY JUDGE: This is an application for permission to seek judicial review in respect of two decisions dated 12th August 2016, made by a Mr Griffiths, an inspector appointed by the Secretary of State for the Environment, Food and Rural Affairs. I say "two decisions" because there is one in relation to substance and one in relation to costs. It is unnecessary for me to say much at all about the decision touching upon costs because Mr Wignall, on behalf of the claimants, made plain that his case in relation to the costs letter stood or fell with the principal letter dealing with the substance of the matter.
2. That letter of 12th August had in fact to deal with two particular sites, one called the "Trout Lane" site and the other called the "Johnson Street" site which was much the smaller of the two. Both sites were, I think, in the London Borough of Ealing.
3. The position is one whereby the Environmental Permitting (England and Wales) Regulations 2010, dealt at the material time with environmental permits, that is to say permits which would be necessary - and here I am speaking in broad terms - in connection with waste sites or other similar sites where it can be expected that the Environment Agency would have a concern over the potential impact on the environment and if, and I am once again speaking broadly, matters went wrong.
4. The position is that by regulation 13 an environmental permit may be granted by the regulator. If such a permit is refused by the regulator it can appeal to an appropriate authority. In this case that can be taken as the Secretary of State acting through his delegate, in effect, Mr Paul Griffiths, the inspector. The regulator is, as I have understood matters, the Environment Agency. The appropriate authority dealing with the appeal stands effectively in the shoes of the regulator in its consideration of the appeal and has to direct the regulator to give effect to its determination.
5. By virtue of regulation 13 Schedule 5 of the regulations to which I have referred, the identity and competence of the operator are regarded as being of significance. This regulation reads as follows:

"Subject to sub-paragraph (3), the regulator must refuse an application for the grant of an environmental permit or for the transfer in whole or in part of an environmental permit if it considers that, if the permit is granted or transferred, the requirements in sub-paragraph (2) will not be satisfied."

The requirements in sub-paragraph (2) are then set out and they are that the requirements are that the applicant for the environmental permit must be the operator of the regulated facility and operate the regulated facility in accordance with the environmental permit. In other words, this provision requires someone in the position of the inspector to consider what would happen by way of operation of the two sites that I have mentioned and whether or no they would be operated in accordance with the environmental permit.

6. It is important here to notice that the Environment Agency clearly took the view that - and that is not the language of the Environment Agency but is mine - that the applicant was lock, stock and barrel unsuited for the purpose of the permit. A summary of the Environment Agency's case, at the conclusion of the inquiry, which of course would have been heard by and taken into account by Mr Wignall, appearing as he did at that inquiry on behalf of the Claimants, Mr and Mrs Malhi, was to this effect that there was a strong and largely unchallenged evidence that the appellant company and its officers have a history of non compliance with regulatory requirements. There was evidence, it was said, of acute non compliance at the Trout Lane site with potentially serious safety and environmental consequences. The evidence not only suggests that Mr and Mrs Malhi were out of their depth in the waste business but they flagrantly disobeyed the law and were doing so only 2 weeks ago. It then goes on say that the Agency's serious concerns about competence were reinforced during the inquiry when Mr Malhi decided at the last minute not to give evidence.
7. The inspector whose decision is capable of being challenged by way of judicial review, made it plain that the main issue to be considered in both appeals is whether the appellant would comply with the conditions that would be applied to any environmental permit that might be issued, in other words consideration of the appeal revolves around operator competence.
8. Mr Wignall did criticise that passage in front of me on the basis that it referred to any environmental permit that might be issued. However, as it seems to me that criticism is not one which can be sustained and certainly not one which can be translated into any form of illegality on the part of the inspector.
9. The inspector then gave his reasons and he identified, first of all, that it was necessary to deal with what is relevant to an analysis of operator competence. He referred to certain guidance from DEFRA, paragraph 9(15) of DEFRA Core Guidance to which I have been referred but do not need to set out. He recorded that it was suggested that only criminal convictions and formal enforcement notices could be considered and not suggestions or allegations of criminal offences taken place. He went on to say that that was rather a narrow interpretation of paragraph 9.15. It seems to me having seen paragraph 9.15 that it is an unduly narrow interpretation of paragraph 9(15), and if paragraph 9(15) was saying that it would not actually be reflecting paragraph 13 of schedule 5 of the relevant regulations which demands that the applicant for the grant of an environmental permit must operate the regulated facility in accordance with the environmental permit. To determine that question does not depend upon the existence of criminal convictions and formal enforcement notices. It plainly will depend upon evidence that the evidence can be from a variety of sources, to include past conduct, which may or may not have resulted in matters bearing upon criminal convictions and formal enforcement notices.
10. The inspector then went on to say, having made the point about the guidance, that there was new guidance in February 2016. He then makes the point that there have been no prosecutions involving the appellant or any formal enforcement action. That indeed was a matter strongly pressed upon me by Mr Wignall and it is plain that the inspector was alive to the point. However, the inspector went on:

"The evidence of the Environment Agency presented in advance of and at the inquiry shows a catalogue of regulatory breaches of the Johnson Street site which lies within an Air Quality management area between April 2012 and 26th February 2016 shortly before the inquiry opened."

That no doubt is a reference to the remarks made in closing by the agency as to matters occurring shortly before the inquiry opened:

"At the Trout Lane between October 2014 and February 2015. Some of these are relatively small but in no way trivial whilst some of such as the illegal, according to the Environmental Agency, deposit and treatment of waste at Trout Lane and the fire observed at the site on 30th October 2014 much more significant."

He went on that it was clear that this rather cavalier disregard for the regulations exhibited by the main operatives of Recycling With Skips Ltd, that company being the present claimant in the proceedings before me, of the two sites before the inspector is nothing new. Observations at another site operated by the principals of the company at Atlas Wharf, between March 2010 and 2012, showed up similar results.

11. In response to the evidence of the Environment Agency about operator competence and specifically the myriad examples of failures to accord with regulations of both sites the subject of appeal and Atlas Wharf the appellant, that is to say the claimants before me in effect, tended proofs of evidence from Mr Malhi, the manager of Recycling With Skips Ltd and Mrs Malhi, the Director. However the inspector went on:

"Mr Malhi was not called to give evidence and was not available for cross-examination because of fears that in answering questions from the Environmental Agency or the inspector he would incriminate himself. As the inspector made plain at the inquiry that severely limited the weight he could attach to his evidence. But the person who had managed the facilitates for which the permit was sought was so defensive about his past record, it does not in the inspector's view shine any positive light on how he could conduct himself in the future. Mrs Malhi was called to give evidence, the inspector recorded, but operated under caution, declining to answer questions where the answer might incriminate her."

12. The inspector went on to refer to the balance of the evidence that he had heard, the well-documented litany of regulatory breaches, the position that they gave was easily defended under cross-examination and he drew attention to the fact that the appellants' assertions or contrary evidence had not properly been tested.
13. It can hardly come as a surprise therefore, the inspector said, that he preferred the evidence of the Environment Agency:

"The record strongly suggested to me if an environmental permit was granted for either or both the facilities Recycling With Skips Ltd would be very unlikely to adhere to the conditions that would be attached."

14. If one pauses there for a moment, it is perfectly clear that the inspector understood the character of the legal question that was before him, understood that there were two sides to the story being put to him, one from the Environmental Agency, which I have referred to, and the other from the claimants, from Mr and Mrs Malhi. It is perfectly plain that he was able to and did prefer the Environment Agency's position, which was of a litany of previous default even though there had been no criminal proceedings or formal enforcement proceedings.
15. In those circumstances, it is said that the inspector insufficiently dealt with individual items. It is not said that there should have been individual assessments of the individual circumstances when matters had been reported of default or error at the sites, but it is said that it should have been explained why the claimant was wrong. It seems to me that it is perfectly clearly explicable from the inspector why the claimant failed in the effort to get the necessary permits. The inspector made perfectly plain whose evidence he preferred; what the character of that evidence was and what it produced. That led inevitably to the circumstance that the permit was going to come to be refused. I do not see how one can begin to categorise that as an error of law.
16. It was suggested that this Decision Letter was too short to deal with the substance of the matter which came to pass. Once again, I do not take that as being a sustainable error of law. It seems to me that brevity has much to commend itself and that there is no reason why an inspector ought to recite everything which he is told, at great length sometimes, at inquiries. On the contrary, it seems to me, as the cases make plain, that he should deal with the substantial points raised which he did, and give reasons which were comprehensible and intelligible to the parties. It seems to me once again, notwithstanding Mr Wignall's complaint about reasons, that he did so.
17. It is worth pausing at this stage to observe that the Vice-President of the Upper Tribunal, sitting as a Judge of the High Court, refused this application on the papers. He said:

"Despite the copious materials and despite the claimants' assertions that the inspector failed to understand the appeal fully, the issue at the heart of this claim is a simple one. The Environment Agency was obliged to refuse the application but considered that the facility would not be operated in accordance with the permit and the same legal context applied to the appeal. It is clear from the guidance that the Agency will look at convictions of the applicants' environmental record but there is no express or implied limitation on what may be considered for these purposes. When it comes to appeal the inspector the same applies. But the inspector must make his own decision on the basis of the material before him to assign the appropriate weight to be given to the evidence from various sources. His decision is not an answer to an examination question, nor is it to be interpreted like a statute and need only deal with the issues that make a difference to his decision and is not required to set them out one by one. The decision is addressed to the parties with all the necessary knowledge of what it is about."

18. I completely agree with that statement both in general terms and in the context of this particular case. He also said:

"The claim that the Agency or the inspector were limited in what they could take account for the purpose of considering whether the facility would be operating in accordance with the regulations is wholly unarguable. So far as the evidence is concerned he expressly noted that he appreciated the reasons why Mr and Mrs Malhi's contribution to the evidence was limited but he also said the evidence was not tested by cross-examination might be less persuasive and disputed it as issues that evidence that had been so tested which was obviously right. He clearly did take into account the evidence of Mr Williamson as part of the factual matrix but Mr Wilkinson had no personal knowledge of many of the issues that were of concern to the Agency. The inspector had to make his decision on the material before him, not speculating about other material that might have been before him and not ignoring the realities of the strength of the various evidence before him. His decision that he did not consider that the applicant would comply with the regulations was amply open to him on the evidence for the reasons he gave and contrary to what is asserted in the grounds those reasons are perfectly intelligible and entirely and unarguably adequate."

19. Similarly I entirely agree with that paragraph save that it appears that the learned judge may have misstated Mr Wilkinson for Mr Williamson (or the other way round).
20. Appeal B he goes to say in relation Trout Lane is governed by the same principles:

"Whatever desirability there may of dealing with the material there the refusal is mandatory given that the Agency and then the inspector did not consider on the evidence that the applicant would operate the facility in accordance with the regulations. That decision is consistent with the decision on appeal A and based on some of the same evidence and was again wholly arguably open to the inspector for the reasons he gave."

Then a further point which I do not need to read out and the learned judge went on to say that there was a discretion in relation to costs and he could see no trace of any ground for saying that the exercise of the discretion was in any way unlawful.

21. I have considered as best as I can the grounds, and I have considered those grounds against the Decision Letter bearing in mind the three particular grounds of judicial review identified by Lord Diplock in the case of CCSU, to be put in brief terms as illegality, impropriety and irrationality. I fail to see that there is any illegality. There was no impropriety and there is certainly no irrationality.
22. In those circumstances this application in respect of both those letters must be refused.
23. MS SERGENTS: My Lord there is an application for costs from the defendant.
24. THE DEPUTY JUDGE: I have seen that in connection with the acknowledgement of service, yes. Are you saying that you just want the costs of the acknowledgement of service or are you saying you want to go further than that and say you have come here today and please can you have your costs for today.
25. MS SERGENTS: The latter.
26. THE DEPUTY JUDGE: You are saying as well?
27. MS SERGENTS: I am my Lord.
28. THE DEPUTY JUDGE: Why should it be different, why should the ordinary practice be departed from. You have come as a volunteer rather than a conscript, have you not?
29. MS SERGENTS: Quite my Lord. Is your Lordship familiar with the Mount Cook decision which addresses this and, at paragraph 75 particularly the circumstances which might indicate that a full award of costs is justified. The exceptional circumstances listed are the hopelessness of the claim, the persistence in it by the claimant after having been alerted to facts and/or the law demonstrating its hopelessness and also whether as a result of the deployment of full argument and documentary evidence by both sides at the hearing of the contested application the unsuccessful claimant has had in effect the advantage of an early substantive hearing of the claim.
30. In short, my Lord, the defendant submits that this claim is entirely hopeless, all 10 of the grounds were hopeless. The claimant has persisted in it after having been made aware of the defendant's position as to its hopelessness and I would also suggest but I do not go so far as to say the claimants have had the full equivalent of a contested substantive hearing. The claimant says he has been able to deploy full argument. The claimant requested that we have an hour-and-a-half here today. So I would say we are approaching also the (d) of the decision in Mount Cook and for those reasons I request the costs.
31. THE DEPUTY JUDGE: Hopelessness by itself does not necessarily mean, does it, that I should award your clients their costs? I mean it is slightly odd that observation in some respects because one might have thought that the case which is hopeless, all you need to do is write in to say: Dear court, stick to your guns and carry on refusing.
32. MS SERGENTS: I accept that observation my Lord. I would add that the claimant did in its skeleton argument for the hearing today advance points that were not taken previously such as the standard review which is applicable here. Therefore, the defendants have to respond in respect of those.
33. THE DEPUTY JUDGE: I think frankly that it ought to be the usual position which is followed in relation to the costs, that you should have your costs of acknowledgement of service but not otherwise, and the costs of the acknowledgement of service have been identified, have they not, in the document of the 28th November 2016?
34. MR WIGNALL: At the end of Mr Ockeleton's reasons.
35. MS SERGENTS: The order the judge granted --
36. THE DEPUTY JUDGE: He gave a figure for it.
37. MS SERGENTS: Yes, my Lord. It is £2,871.
38. THE DEPUTY JUDGE: Very well. That is the order that I think ought to be made, subject to anything which is said about it. Your are further down the line.
39. MS THORNTON: If I could join in the party as it were. I am going to ask for the Agency's costs both of the acknowledgement of service and today's hearing.
40. THE DEPUTY JUDGE: Why should your position be favourable than the Secretary of State?
41. MS THORNTON: There are two separate issues: one, does the Agency fall within the exception of Bolton and then secondly, should we get the --
42. THE DEPUTY JUDGE: Interest of your own. What is the interest of your known. You are no different, if I may respectfully say so, from a planning authority, standing alongside the Secretary of State, who upholds one of their decisions capable to the authority on appeal.
43. MS THORNTON: The reason I have come to make that submission that your Lordship is seeing is rather bold because of Mr Ockeleton's order, if I could take your Lordship to it. He says as follows:

"I am not persuaded that it would be right at this stage to order the claimant also to pay the Environmental Agency's costs but that position may change if this application is renewed to an oral hearing for the reasons given in the sentence at paragraph 47 of its summary grounds of defence."

44. Now what we said in paragraph 47 Mr Ockeleton is referring to is the Environmental Agency is uniquely placed to explain the inquiry process and the merits of appeal before the inspector.
45. Now my Lord, when --
46. THE DEPUTY JUDGE: Why are you uniquely placed? I do not quite understand that proposition. I understand that you were there of course. I understand the Environment Agency will know about this type of inquiry. This type of inquiry is intended to be conducted in the spirit of the inquiries under the Town and Country Planning Act legislation, and the court, if I maybe so bold, knows all about those.
47. MS THORNTON: My Lord, we read Mr Ockeleton's order as an indication we should come along today. You obviously heard from the submissions of my learned friend, Mr Wignall, that there was a more intense focus on the facts of what happened at the inquiry here. Mr Wignall had a good attempt at re-running many of the arguments he ran before the inspector. We considered it necessary to stand ready, should you require that assistance, which in the eventuality you did not but should your Lordship have required that assistance we considered it necessary to be here today. It is for those reasons.
48. THE DEPUTY JUDGE: I understand all that. I am still of the view that ultimately you are here as a volunteer and I ought to stick with the usual position.
49. So I am very sorry, notwithstanding what Mr Ockeleton said there, I am going to leave costs as they were signified by him.
50. MS THORNTON: Thank you my Lord.
51. THE DEPUTY JUDGE: It does not mean to say one is ungrateful for the effort that went into it all, or that one lacks gratitude for the paperwork that was done, but it just means to say that I am just taking a view as to who is here, so to speak, as a conscript and who is here as a volunteer.
52. Thank you very much.