14 – Costs Caps: A Re-Cap

Following the recent debate between Alex and Nick as to the merits (or de-merits) of the reforms to the Aarhus costs rules advocated by ELF, Friends of the Earth and the RSPB in their recently published ‘A Pillar of Justice II’ report, this is perhaps a useful juncture for a review of the current rules and how they have ended up as they are.

Aarhus costs caps and the CPR

The protections afforded by Article 9(4) of the Aarhus Convention – that the procedures provided for in Articles 9(1)-(3) “shall not be prohibitively expensive” – are given effect through CPR rr.45.41 – 45.45 (first instance) rr.52.19A (appeals) and applied to proceedings in the Supreme Court by Practice Direction 13 para 2.

Those protections are not otherwise enforceable in the domestic courts: see R (Venn) v Secretary of State for Communities & Local Government [2015] 1 WLR 2328, in which the Court of Appeal allowed the Secretary of State’s appeal against a cost protection order made by the High Court under in a statutory review under s.288 at a time when the CPR only provided for Aarhus costs protection to apply in claims for judicial review, the costs protection order having been made by the Judge under the court’s general discretion, with the Corner House[1] principles relaxed to give effect to the requirements of the Aarhus Convention. Per Sullivan L.J. at para 33:

“Once it is accepted that the exclusion of statutory appeals and applications from CPR r 45.41 was not an oversight, but was a deliberate expression of a legislative intent, it necessarily follows that it would not be appropriate to exercise a judicial discretion so as to side-step the limitation (to applications for judicial review) that has been deliberately imposed by secondary legislation. It would be doubly inappropriate to exercise the discretion for the purpose of giving effect under domestic law to the requirements of an international Convention which, while it is an integral part of the legal order of the EU, is not directly effective (see Brown Bear [2012] QB 606), and which has not been incorporated into UK domestic law: see Morgan [2009] Env LR 629”

The Court of Appeal was uneasy at having to reach this conclusion, as it considered it apparent that the (then) current rules were not Aarhus compliant, but

“This court is not able to remedy that flaw by the exercise of a judicial discretion. If the flaw is to be remedied action by the legislature is necessary.”

The rules were in fact substantially amended after that judgment, redressing the omission of statutory reviews from within the definition of an “Aarhus convention claim” for the purposes of the CPR, but also introducing the potential for variation of the default cost caps. These changes were introduced by the Civil Procedure (Amendment) Rules 2017, and followed on from a detailed consultation on proposed changes to the rules, in light of the adverse decisions regarding the UK’s (non) compliance with Article 9(4) in Case 260-11 R (Edwards) v Environment Agency (No 2) [2013] 1 WLR 2914 and Commission v UK [2014] QB 988. The key changes introduced in 2017 were:

1. The expansion of the definition of “Aarhus Convention claims” so as to include “a review under statute”, including appeals under s.289 TCPA 1990 and s.65(1) of the Planning (Listed Buildings and Conservation Areas) Act 1990;
2. Specific provisions for Aarhus cost protection on appeals (r.52.19A);
3. The power for the default costs caps to be varied, either on application by the claimant or defendant or the court of its own volition;
4. A requirement for a claimant seeking an Aarhus costs cap to file with their claim form “a schedule of the claimant’s financial resources which takes into account any financial support which any person has provided or is likely to be provided to the claimant and which is verified by a statement of truth”; and
5. Specifying, in r.45.41, that an “Aarhus Convention claim” was one brought by “one or members of the public”, with the term “member of members of the public” to be “construed in accordance with the Aarhus Convention”.

The change at point (5) reflected the finding of the Court of Appeal in R (HS2 Action Alliance) v Secretary of State for Transport [2015] PTSR 1025 that the definition previously set out in CPR r.45.41, which did not require the claim to have been brought by a member of the public, should not be read as excluding public authorities from being able to seek Aarhus costs protections as claimants.

Those amendments to the rules were challenged by a consortium of environmental charities (the RSPB, Friends of the Earth, and Client Earth): R (RSPB) v Secretary of State for Justice [2018] Env LR 13. The Court (Dove J) held that the ability to vary the default cost caps was lawful, having regard to the Secretary of State’s submissions that any application to vary the cap by the defendant should ordinarily be made at the time it filed its acknowledgment of service, with exceptions where the claimant had either provided false or misleading information in their schedule of resources or there was a material change in their circumstances (paras 37-41). It was also accepted by the Secretary of State (and agreed by the court) that in deciding whether proceedings would be “prohibitively expensive” that the court could have regard to the claimant’s own costs of bringing the claim, although the court considered it unnecessary to grant a declaration to that effect (paras 58-59). The amended rules were, however, defective to a limit extent insofar as they did not provide for any hearing into a variation of a costs cap to be heard in private (para 57).

Following the judgment in RSPB, further amendments were made to the CPR to reflect the Secretary of State’s concessions and the findings made by Dove J in respect of the information to be provided in the schedule of financial resources, for any applications to vary to be heard in private, and the timing of any applications to vary the default costs cap.

So, where are we now?

• “Aarhus Convention claims”
  • Defined in CPR r.45.41 “a claim brought by one or more members of the public by judicial review or review under statute which challenges the legality of any decision, act or omission of a body exercising public functions, and which is within the scope of Article 9(1), 9(2) or 9(3) of the UNECE Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters done at Aarhus, Denmark on 25 June 1998”;
  • The term “members of the public” is to be construed in accordance with the Aarhus Convention.
    • It does not include local authorities: see ACCC/C/2014/100 & 101 (complaints to the Aarhus Compliance Committee against the UK (100) and the EU (101) in which the Compliance Committee found that the London Borough of Hillingdon was not a “member of the public” for the purposes of Article 15 of the Convention and thus was unable to submit a communication to it;
    • Community/Parish councils are included: see ACCC/C/2012/68 (a complaint about renewable energy programmes in Scotland) and Crondall Parish Council v Secretary of State for Housing, Communities and Local Government [2019] EWHC 1211 (Admin) (costs protection decided at permission by Sir John Howell KC).
  • Cost protection applies to claims for judicial review, statutory review (including under s.113 PCPA 2004[2]), appeals under s.289 TCPA 1990 and appeals against listed building enforcement appeals (s.65(1) of the Planning (Listed Buildings and Conservation Areas) Act 1990.

• All planning claims?
  • There is a common assumption the cost protections apply to any/all planning claims
  • See now: R (Lewis) v Welsh Ministers [2022] EWHC 450 (Admin):
    • Focus must be on the nature of the claim rather than the nature of the decision challenged
    • Requires consideration of whether claim is within the scope of Art 9(3)
    • For a case falling under Art 9(3) that requires consideration of the provision of national law which is said to have been breached
  • If limit imposed by CPR r.45.43 applies to a claim it applies to the entirety of the claim (no issue based cost caps): Lewis[3].

• When do costs protections apply?
  • The claimant must state in claim form whether or not the claim is an Aarhus Convention Claim and whether the claimant does / does not want the costs limits in CPR r.45.43 to apply (CPR r.45.42(1) and (2))
    • On importance of timeliness for claimants, see R(Ibrar) v SSLUHC [2022] EWHC 3425 (Admin)
  • The claimant must file a schedule of financial resources with the claim form, verified by a statement of truth, and setting out details of:

• The claimant’s significant assets, liabilities, income and expenditure; and
  • In relation to any financial support which any person has provided or is likely to provide, the aggregate amount which has been provided and which is likely to be provided
  • That includes monies which the claimant may reasonably expect to receive through eg Crowdfunding, but fact more monies received after schedule filed does not mean that information provided by the claimant is necessarily deficient: see eg Lewis at para 16

• Challenging the costs provisions
  • A defendant (or interested party[4]) can challenge whether claim is an Aarhus Convention claim – r.45.45 – but the court will normally award costs against that party (not included in costs cap) if the challenge is unsuccessful: r.45.45(3)(b) & see also R (Kent) v Teeside Magistrates’ Court [2020] Costs LR 195.
  • The challenge should be made in the acknowledgment of service, as should any application for variation of the default costs cap.

• Default costs limits:
  • The default (r.45.43) is:
    • £5,000 where the claimant is claiming as an individual and not as, or on behalf of, a business or other legal person
    • £10,000 for the claimant in all other cases (this includes public interest groups incorporated as a company for the purpose of bringing the claim)
    • £35,000 for the defendant
  • Limits (as in potential costs liability to other party/ies) apply to individual claimant or defendants, not the claim: r.45.43(4)
  • Costs limits are inclusive of VAT: R (Friends of the Earth) v Secretary of State for Transport [2021] EWCA Civ 13
  • No default limits specified where costs cap sought on appeal: CPR r.52.19A

• Variation of the default costs caps
  • The default costs caps can be varied by the court on application by the claimant, defendant or interested party (CPR 44.45)
  • A variation can only be made on an application made in accordance with CPR r.45.44(5)-(7) and if the court is satisfied that (a) to do so would not make the proceedings prohibitively expensive for the claimant; and (b) that in the case of a variation which would reduce a claimant’s maximum costs liability or increase that of a defendant, that without the variation the costs of the proceedings would be prohibitively expensive for the claimant (CPR r.45.44(2));
  • If the application is made by the claimant, it must be made in claim form and provide the claimant’s reasons why proceedings would be prohibitively expensive if variation not made.
  • If made by the defendant, it must be made in the acknowledgment of service and must provide the defendant’s reasons why, if the variation was made, the costs of proceedings would not be prohibitively expensive for C.
  • A variation for an application can also be made by an interested party: R(Bertoncini) v Hammersmith & Fulham LBC [2020] 6 WLUK 174 applying R (CPRE Kent) v SSCLG [2019] EWCA Civ 1230 at paras 46-48.
  • The court must determine the application at earliest opportunity.
  • If made on the papers when refusing permission, a party may ask for the application to be reconsidered at any renewed oral permission hearing: see generally the court’s jurisdiction as discussed (albeit in a different context) in R (MD) Afghanistan v Secretary of State for the Home Department [2012] 1 WLR 2422.
  • An application to vary may be made at a later stage in the circumstances specified in CPR r.45.44(6)-(7).
    • Note, a material increase in funding position might be relied on by a defendant/interested party in arguing for a variation of the costs limit (either subsequently or on an appeal): see, eg, R (RSPB) at paras 34, and 39-40.
  • Variation applications are heard in private: CPR r.39.2(3)(c)

• “Prohibitively expensive”?
  • Test is in r.45.44(3). Proceedings are likely to be prohibitively expensive if the likely costs (including any court fees payable by the claimant) either:
    • Exceed the claimant’s financial resources, or
    • Are objectively unreasonable having regard to:
      • The situation of the parties;
      • Whether the claimant has reasonable prospects of success;
      • The importance of what is at stake for the claimant;
      • The importance of what is at stake for the environment;
      • The complexity of the relevant law and procedure;
      • Whether the claim is frivolous.
    • Where the court is considering the claimant’s financial resources, it must have regard to any financial support which any person has provided or is likely to provide to the claimant (r.44.44(4))
    • In considering whether proceedings would be prohibitively expensive, the court may properly have regard to the claimant’s own costs in bringing the claim: R (RSPB) at para 58.

• Assessment of costs in cases where Aarhus costs caps apply:
  • R (CPRE Kent) v SSCLG [2019] EWCA Civ 1230 at paras 49 – 52
    • There is no difference in the usual approach to the summary assessment of costs. The court assesses reasonable costs, and the cap is then applied (if it would otherwise be exceeded).
    • Importantly there are no separate caps for permission and substantive stages.
  • Subject to the cap, the default position is that both the defendant and any interested party are entitled to their reasonable costs of acknowledging service where permission is refused on the papers: R (CPRE Kent) v Secretary of State for Communities and Local Government [2019] EWCA CIv 1230; [2021] UKSC 36.

• What claims are not included?
  • CPR r.45.41 – 45 do not apply to claims for private nuisance, even if raising issues to which the Aarhus Convention applies: Austin v Miller Argent (South Wales) Ltd [2014] EWCA Civ 1012.
  • There is also a suggestion it does not apply to a s.288 challenge to a costs award by PINS: Halton Borough Council v SSLUHC [2023] EWHC 293 (Admin) at para 106.
  • Commentary indicates that an unsuccessful party also unable to rely on the Aarhus Convention to limit its costs liability in a private nuisance claim: see Coventry v Lawrence [2014] UKSC 46 (NB: this will be revisited in a later post).
  • In R (Richards) v Environment Agency [2022] Env LR 14, no costs protection was sought (the claimant was legally aided in that case), but see Fordham J‘s judgment at para 68 as to the extent to which his order as to costs was (or more pertinently, was not) influenced by the EA’s reference to cost-caps in Aarhus claims.

[1] R (Corner House Research) v Secretary of State for Trade and Industry [2005] 1 WLR 2600.

[2] See R (CPRE Kent) v Secretary of State for Communities and Local Government [2019] EWCA CIv 1230; [2021] UKSC 36.

[3] In that case it was only Ground 3 which triggered cost protection. The court was satisfied it was included in good faith, but left open the possibility that if a different view were to be reached in a different claim there might be a different outcome.

[4] Following R (CPRE Kent) v Secretary of State for Communities and Local Government [2019] EWCA Civ 1230 as applied in R(Bertoncini) v Hammersmith & Fulham LBC [2020] 6 WLUK 174.

Authors

– James Maurici KC – James has been in many of the leading cases on Aarhus costs including: R (RSPB) v SSJ [2017] 5 Costs L.O. 691; Case C 530/11 Commission v United Kingdom; Case C-260/11 Edwards v EA; R (Edwards) v EA (No.2) [2011] 1 Costs L.R. 70 and [2013] UKSC 78; and R (Edwards) v EA [2011] 1 W.L.R. 79. He has also appeared a number of times before the UNECE Aarhus Compliance Committee in Geneva, cases include: ACCC/C/2010/45; ACCC/C/2010/53; ACCC/C/2011/60; ACCC/C/2011/61; ACCC/C/2012/77; and ACCC/C/2014/100 and 101. He is currently acting for the UK Government on the Brexit communication to the Compliance Committee – ACCC/C/2017/150. He was one of the contributors to the Aarhus Convention: A Guide for UK Lawyers (2015) and he has written and lectured extensively on the Aarhus Convention.

– Jacqueline Lean – Jacqueline has also been instructed on a number of matters concerning the Aarhus Convention, including appearing (with James Maurici KC) for United Kingdom before the Aarhus Compliance Committee on two communications concerning the Government’s decision to proceed with HS2 (ACCC/C/100 & 101); representing the Secretary of State for Communities and Local Government Secretary of State in R (CPRE Kent) v Secretary of State for Communities and Local Government [2019] EWCA Civ 1230 in which the Court of Appeal considered the approach to summary assessment of costs at permission stage when an Aarhus costs cap applied; and acting for the Secretary of State in R (RSPB) v Secretary of State for Justice [2018] Env LR 13, a challenge to the Government’s amendments to the Aarhus costs protections in the CPR (also with James Maurici KC). She is also a contributing author to Coppel’s ‘Information Rights’ on Environmental Information.

– Nick Grant – Nick joined Chambers in 2019 and has regularly advised on Aarhus related matters. He has represented the UK twice before the Aarhus Convention Compliance Committee, appearing with James Maurici KC in ACCC/C/2017/150 (the Withdrawal Act case) and unled in the admissibility hearing for ACCC/C/2022/194 (the free trade agreements case).

– Alex Shattock – Alex has been involved in a number of environmental claims including Friends of the Earth v SSLUHC (the Cumbria coal mine case: acting for Friends of the Earth in the Planning Inquiry and High Court, with Paul Brown KC and Toby Fisher); Cox and Ors v Oil and Gas Authority [2022] EWHC 75 (Admin) (representing Extinction Rebellion activists in a challenge to the Oil and Gas Authority’s Strategy, with David Wolfe KC and Merrow Golden); R (Hough) v SSHD [2022] EWHC 1635 (acting for the claimant in an environmental and equalities challenge to the controversial use of Napier Barracks as asylum seeker accommodation, with Alex Goodman and Charles Bishop). He regularly advises individual and NGO clients on Aarhus costs protection. Alex also has a keen interest in treaty law generally. He has a masters and PhD in public international law and has been involved in various treaty negotiations and treaty ratification processes.