High Court of Ireland Decisions

Neutral Citation No: [2007] IEHC 30

THE HIGH COURT

JUDICIAL REVIEW

2004 No 694 J.R.

BETWEEN

USK AND DISTRICT RESIDENTS ASSOCIATION LIMITED

APPLICANT

AND

THE ENVIRONMENTAL PROTECTION AGENCY

RESPONDENT

AND

GREENSTAR RECYCLING HOLDINGS LIMITED

NOTICE PARTY

RULING of Mr. Justice Clarke delivered the 15^th February, 2007.

1. Introduction

1.1 These proceedings have been the subject of a number of determinations of the courts at various interlocutory stages. For a description of the issues which arise in the substantive proceedings see the judgment of Finlay Geoghegan J. in the application for leave to seek judicial review sought by the applicant ("Usk") in relation to a waste licence given by the respondent ("the GPA") to the notice party ("Greenstar") (Unreported, High Court, Finlay Geoghegan J. 28^th July, 2006) ("the leave judgment"). An earlier application for security for costs was dealt with both in this court and by the Supreme Court (see Usk District Residents Association v. EPA 1 ILRM 363). In a ruling delivered on the 13^th October, 2006, Finlay Geoghegan J. dealt with the costs of the leave application ("the costs ruling"). For the reasons set out in that ruling, the costs of the leave application were reserved to the judge dealing with the substantive judicial review hearing.

1.2 Thereafter that substantive judicial review hearing was determined by me in a judgment delivered on the 15^th December, 2006 ("the substantive judgment"). This ruling is concerned with the remaining costs issues including the costs of that substantive judicial review application and the costs of the leave application which were reserved to me by Finlay Geoghegan J. The EPA and Greenstar seek the costs of the entire proceedings (including the cost of the leave application). Usk accepts that the costs of the proceedings generally must be awarded to the EPA but suggest that Greenstar's involvement at the substantive hearing was unnecessary and that no order should be made as to Greenstar's costs of that hearing. Usk also suggests that the costs of the leave hearing should either be awarded to it or, at a minimum, that no order as to those costs should be made.

2. The Leave Costs Ruling

2.1 A number of matters arising from the leave hearing are, in my view, of significant materiality to the costs issues which I now have to determine. It is clear that Usk only obtained leave in respect to some but not all of the grounds on which leave was sought. There was some dispute at the hearing before me as to how best to characterise the extent to which Usk might be said to have succeeded in obtaining leave or, alternatively, the extent to which the EPA or Greenstar could equally be said to have successfully resisted leave.

2.2 It does not seem to me to be appropriate to go behind the characterisation adopted by Finlay Geoghegan J. who had the benefit of having heard the full argument at the leave stage. At p. 5 of the costs ruling Finlay Geoghegan J. had regard:-

"To the limited grounds upon which leave has been granted and the extensive grounds advanced in the statement of grounds, some of which were abandoned only at the commencement of the hearing of the leave application and others of which were pursued but refused."

Finlay Geoghegan J. went on to note that:-

"In such circumstances the position taken by the respondent and the notice party cannot be considered unreasonable."

and further suggested that the position might be otherwise had Usk at all times pursued their challenge to the waste management licence on more focused grounds.

2.3 Secondly, reliance was placed at the hearing before me on the fact that, when the matter was initially admitted into the Commercial List, and was being managed by Kelly J., Usk suggested that the application for leave be treated, if the judge hearing it formed the view that substantial grounds existed, also as the full application for judicial review. It would also appear that a similar suggestion was made to Finlay Geoghegan J. at the commencement of the leave application. In respect of that argument Finlay Geoghegan J. came to the following conclusion at p. 4:-

"As a general proposition, there is merit in the submission made on behalf of the applicant. The statutory schemes which require applications on notice for leave to issue judicial review may give rise, on occasion, to an unnecessary double contested hearing with consequential delay and costs for the parties. I accept in principle the submission that where a respondent requires a full leave hearing and leave is granted then, in certain circumstances, it may be appropriate to award the applicant its costs of the leave application independently of the full outcome of the judicial review proceedings. It may also be particularly appropriate in judicial review proceedings admitted to the Commercial List, the purpose of which is inter alia to provide for effective, speedy, fair and efficient justice whilst avoiding the incurring of unnecessary cost to the parties."

2.4 I respectfully agree with those principles. However, it is equally clear that Finlay Geoghegan J. was not satisfied that the application of those principles to the facts of the leave application before her, gave rise to a situation where Usk was entitled to its costs of the leave application irrespective of the outcome of the full judicial review proceedings. It is also important to note that the substantive judicial review application failed for the reasons which I set out in my judgment of the 15^th of December, 2006.

2.5 Therefore the issues concerning the award of costs in relation to both the substantive application and the reserved costs of the leave application fall to be determined against a background that the proceedings as a whole have failed. I should also state that there is no substantive basis put forward in this case to suggest that I should deport altogether from the principle of costs following the event for the type of public interest reasons noted by Macken J. in Dubsky v. Ireland (Unreported, High Court, Macken J. 13^th December 2005) and Harrington v. An Bord Pleanála [2006] IEHC 223.

3. The Appropriate Principles

3.1 In that context it is appropriate to turn to the principles to be applied for the award of costs both generally and in the particular context of proceedings before the Commercial Court. In Veolia Water UK Plc. and Others v. Fingal County Council [2006] IEHC 240 I suggested certain general principles to be applied in relation to the assessment of costs in complex litigation including cases where there are hearings which do not give rise to a final conclusion of the proceedings (such as a contested leave application in environmental litigation such as this).

3.2 For the reasons set out at para. 2.2 of that judgment I came to the view that courts should attempt what might be described as a more nuanced approach to the award of costs than might, heretofore, have been the case in respect of such complex litigation.

3.3 However as pointed out at para. 2.5. of that judgment, the overriding starting position must remain that costs should follow the overall event. As I stated in that judgment:-

"Parties who are required to bring a case to court in order to secure their rights are, prima facie, entitled to the reasonable costs of maintaining the proceedings. Parties who successfully defend proceedings are, again prima facie, entitled to the cost to which they have been put in defending what, at the end of the day, the court has found to be unmeritorious proceedings. Similarly it seems to me that courts generally (and the Commercial Court in particular) should be prepared to deal with the costs of contested interlocutory applications on the basis of an analysis of whether there were proper grounds for bringing, on the one hand, or resisting, on the other hand, the relevant application. In that context it may be appropriate to distinguish the case of a routine application which would have to be brought in any event as part of the ordinary course of the proceedings and which is not contested to the extent that the costs of the application are increased. In such a case it may well be appropriate that the costs either be reserved to the trial judge or be made costs in the cause."

3.4 It is clear, therefore, that the starting position has to be that, ordinarily, a party, such as the EPA and Greenstar in these proceedings, who successfully resists a plaintiff's or applicant's claim, will be entitled to all of the costs reasonably incurred. Therefore prima facie both the EPA and Greenstar should be entitled not only to the costs of successfully defending the substantive judicial review hearing but also to the costs of the leave hearing. The proceedings have been found to be unmeritorious. If they had not been brought, then the EPA and Greenstar would not have been subjected to any costs of defending them. The real issue which I have to determine is as to whether there is any proper basis for departing from that position.

4. Application to This Case

4.1 As is clear from the costs ruling of Finlay Geoghegan J. in this case and from my judgment in Veolia, there may well be a basis for departing from that overall principle where a party, though successful in the overall sense, may be said to have significantly added to the costs of the litigation either by raising substantive issues at trial (which significantly added discrete new elements to the costs of the proceedings) and which were found to be unmeritorious or where interlocutory applications were unreasonably brought or unreasonably defended to the extent that significant additional costs were also added. In that context it is illustrative to note that both Finlay Geoghegan J. and I had regard to the distinction that needs to be made between applications which are made as of course as part of the ordinary and necessary process of the litigation on the one hand and applications which either do not form part of the ordinary process (and may therefore be regarded as, in a sense, elective) on the other hand. Into the latter category might also be placed applications which, while in one sense as of course, are turned into a much more significant hearing, with much more significant attendant costs, by reason of the attitude adopted by the parties to the question at issue.

4.2 The leave application in this case, perhaps, fits into the latter category. Clearly an application for leave at which the court would require to have been satisfied, irrespective of the views expressed by the respondent and the notice party, that leave should be granted would, necessarily, have occurred, in any event, in this case. It may be said that a more substantial hearing of the application for leave was necessitated by virtue of the position adopted by the EPA and Greenstar. However that position was ultimately found by Finlay Geoghegan J. to be "not unreasonable" having regard to the result of the leave application.

4.3 Furthermore it does not seem to me that the position adopted by both the EPA and Greenstar in respect of declining to agree to what would, in substance, have amounted to a single hearing, was unreasonable on another basis as well.

4.4 The grounds in respect of which leave was ultimately granted were grounds concerned with the concept of BATNEEC (for the meaning of which see the leave judgment and the substantive judgment). Those grounds were essentially legal in nature though obviously based to some extent on the facts of the case. It would also appear that many of the other grounds in respect of which leave was originally sought would have raised the question of the reasonableness, or otherwise, of the decision making process engaged in by the EPA and would also have had particular regard to the environmental impact assessment engaged in by the EPA. It seems to me to be highly likely that in the event that leave had been granted on some or all of those grounds that it would have been necessary for the EPA to place before the court a significant volume of additional evidence which, by reason of the exclusion of those additional ground at the leave stage, did not ultimately have to be placed before, or considered, by the court.

4.5 The position faced by the EPA and Greenstar, prior to the leave application, was, therefore, complicated. If they were to have agreed to the suggestion of a single hearing, this, in practice, would have meant that all of that additional evidence would have had to be put before the court on the leave application. In the events that happened that additional evidence did not have to be put before the court at all because leave was refused in relation to the grounds to which it might have been relevant. The savings attributable to that state of affairs need to be set against any duplication that might have occurred by virtue of two hearings. In those circumstances it also seems to me that the decision to decline a single hearing was reasonable. The situation might well be different in a case where, irrespective of the grounds upon which leave might be given, no significant additional evidence would need to be placed before the court by respondents or notice parties. In those circumstances it remains, of course, open to such parties to rest upon their statutory entitlement to two hearings. However if they do so they run the risk (particularly, for the reasons pointed out by Finlay Geoghegan J., in cases where leave is granted on most of the grounds sought) that the court may find that, irrespective of the outcome of the proceedings as a whole, additional costs have been unnecessarily incurred by two full hearings.

5. Conclusions

5.1 However for the reasons which I have sought to analysis above it does not seem to me that the position adopted by the EPA and Greenstar in declining a single hearing on the facts of this case can be said to have been unreasonable. Neither was their opposition to the grant of leave deemed by Finlay Geoghegan J. to have been unreasonable. If Usk had succeeded in some part at the substantive hearing then those factors would also need to be seen against the background of proceedings which were ultimately successful and it would only, in that context, be necessary to consider whether some departure from awarding the full costs of the leave application to Usk would have been necessary. The issues which arise in relation to the costs of the leave application need now to be seen against the background of proceedings which have ultimately been found to be unmeritorious.

5.2 As pointed out in Veolia, the default position is that all costs should be awarded to the successful party. Where that successful party is a defendant, respondent, or, indeed, a notice party who opposes an application, then that position should be departed from only where the court is satisfied that there are good grounds for taking the view that the costs of the proceedings as a whole (including any appropriate interlocutory applications) have been clearly increased by reason of an unreasonable position adopted by that successful party in respect of some issue which has not already been the subject of a costs order reflecting the relevant unreasonableness.

5.3 For the reasons which I have sought to analysis above it does not seem to me that it can be said that either the EPA or Greenstar, on the facts of this case, have increased the overall costs of the proceedings in an unreasonable manner by any step or position which they took. It is by no means clear that a single hearing of the type suggested, having regard to the fact that significant additional facts would, in all probability, have had to be gone into, would have necessarily lead to less overall court time being expended on the hearings. Certainly it could not be said that it should have been obvious, in advance, to the EPA and Greenstar that that would be so. The court should not attempt to assess such matters with the benefit of hindsight. In addition, the fact that Finlay Geoghegan J. characterised the opposition to the leave application as "not unreasonable", necessarily implies that a material element of the significant costs, which undoubtedly arise in these proceedings, stems from the fact that Usk adopted a very broad brush approach in its initial challenge. In all the circumstances I do not see any proper reason to depart from the ordinary proposition that the successful party should be entitled to all costs appropriate to the defence of the proceedings.

5.4 Finally it is necessary to deal with the discrete issue raised in respect of the costs of Greenstar. It seems to me that these proceedings are intimately concerned with the rights and entitlements of Greenstar. The challenge to the licence granted by the EPA to Greenstar has failed. Greenstar was, therefore, a party intimately involved in the defence of its legitimate interests in seeking to put forward argument in support of the defence by the EPA of the challenge to the waste licence. The fact that the focus of the proceedings shifted, to some extent as a result of the exclusion of many of the grounds at the leave stage, to issues which were concerned with the consideration by the EPA of whether the proposal was BATNEEC, does not distract from the fact that that issue was intimately concerned with the manner in which Greenstar would operate the facility on foot of the licence. I do not see any basis, therefore, for taking any different view in respect of the costs of Greenstar to those of the EPA.

5.5 I should, however, note that there may well be cases where it would be appropriate for notice parties (who are not as intimately connected with the issues as in this case) to consider whether it is necessary to participate, or at least participate fully, in judicial review proceedings. The mere fact that the party may have a sufficient interest so as to make it legitimate that they be placed on notice of the proceedings does not, of itself, necessarily carry with it an entitlement to that party to an unquestioned order for costs in the event of the proceedings being successfully defended. The extent to which such a notice party may be entitled to some or all of the costs of successfully supporting the defence of the application, will depend on all the circumstances of the case and, in particular, the extent of the interest of that party in the issues which are the subject of the judicial review application and the extent to which it may be regarded as reasonable for that party, in those circumstances, to independently oppose the application. Having regard to those principles it does not appear to me to be appropriate to diminish the entitlement of Greenstar to costs on the facts of this case.

Approved: Clarke J.