Unsuccessful claimants at permission stage in statutory planning reviews and judicial reviews may be liable to more than one defendant and interested parties for costs: Supreme Court

Claimants who unsuccessfully apply for permission to bring judicial review or statutory planning review challenges can be ordered to pay costs to multiple defendants and interested parties for their costs in filing acknowledgements of service, the Supreme Court has ruled.

The case of CPRE Kent v Secretary of State for Communities and Local Government [2021] UKSC 36 concerned an application for statutory review of a planning decision where the court refused the claimant permission to proceed with the claim.

The question of costs is relevant to both statutory planning reviews, which are subject to the procedure set out in the Civil Procedure Rules (CPR) Practice Direction 8C, and applications for judicial review, which are subject to a similar procedure for acknowledgment of service under CPR Part 54.

The background to the Supreme Court case was that in 2017, Maidstone Borough Council adopted a local plan for the years 2011-2031.

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This followed a finding by an inspector appointed by the respondent, the Secretary of State for Communities and Local Government that, subject to modifications, the Local Plan was sound under Part II of the Planning and Compulsory Purchase Act 2004 (the 2004 Act).

The Local Plan included a policy which provided for the allocation of a site at Woodcut Farm owned by Roxhill Developments Limited for mixed employment floorspace.

The appellant, the Kent branch of the Campaign to Protect Rural England (CPRE), filed a claim for statutory review under section 113 of the 2004 Act challenging the adoption of the policy.

It served the claim on the Secretary of State as the first defendant, the council as the second defendant and Roxhill as an interested party.

Following service, each of the Secretary of State, the council and Roxhill filed acknowledgements of service and summary grounds for contesting the claim.

The judge refused permission for the claim. In awarding costs, the judge acknowledged the claim was an Aarhus Convention claim and made cost orders in favour of each of the Secretary of State, the council and Roxhill up to the Aarhus cost cap of £10,000. That cost decision was subsequently confirmed following a challenge by CPRE.

The Court of Appeal dismissed an appeal by CPRE, finding that unsuccessful claimants at the permission stage may be liable to more than one defendant and/or interested party for their reasonable and proportionate costs in preparing and filing acknowledgments of service and summary grounds.

The Supreme Court has unanimously dismissed CPRE’s appeal, holding that the Court of Appeal had the principal responsibility for developing practice in relation to orders for costs. Absent an error of law, there was no basis for the Court to intervene in this case.

Lord Hodge, who gave the only judgment, said that a court’s authority in relation to the award of costs came from a variety of sources. First, section 51 of the Senior Courts Act 1981 (the 1981 Act) conferred power on the High Court and Court of Appeal to make cost orders at their discretion. Secondly, there were rules of court made by the Civil Procedure Rules Committee. Thirdly, the rules of court were supplemented by practice directions made by the Master of the Rolls. Fourthly, the appellate courts were responsible for developing principles for the award of costs within the framework of the 1981 Act, the rules of court and the practice directions.

Lord Hodge noted that this appeal was concerned with the fourth category of authority and it was therefore necessary to consider the Supreme Court’s recent decision in R (Gourlay) v Parole Board [2020] UKSC 50.

In Gourlay, the Court explained that the principles laid down by the appellate courts were generally matters of practice and not matters of law. Responsibility for developing practice in relation to cost orders lay principally with the Court of Appeal.

The reason for this was that the Court of Appeal, which hears many more cases than the Supreme Court, was better placed to assess what changes in practice are appropriate with speed, flexibility and sensitivity.

“Only in the rare circumstance that an appeal on costs raises a question of law of general public importance was it appropriate to appeal to this court solely on a question of costs,” Lord Hodge said.

Applying the reasoning in Gourlay to the facts of the CPRE case, Lord Hodge said he was satisfied that the Court of Appeal had not erred in law. CPRE’s appeal was therefore dismissed.

The Supreme Court judge said that the case of Bolton Metropolitan District Council v Secretary of State for the Environment (Practice Note) [1995] 1 WLR 1176, which was relied on by CPRE as establishing that where there was multiple representation in a planning appeal, the losing party would not normally be required to pay more than one set of costs, was “as indicated in its title” a case providing guidance on practice.

The case also concerned the award of costs after a substantive hearing and predated the CPR, which introduced the acknowledgment of service procedure. CPR Part 54 had been the subject of judicial consideration in a number of High Court and Court of Appeal judgments. The case law emphasised that CPR Part 54 obliged a defendant or interested party to file an acknowledgement of service and summary grounds if it wished to take part in a judicial review (whereas in the past there had been no such obligation).

In those circumstances, an unsuccessful claimant should in principle be liable for the reasonable and proportionate costs of defendants and interested parties in relation to that initial procedural step, Lord Hodge concluded.

As recognised by the Court of Appeal, this reasoning applied equally in the context of statutory planning reviews. “There is no error of law in the decision to qualify or make an exception to the guidance as to practice contained in Bolton because that decision is itself no more than guidance as to practice.”

Lord Hodge also found that the Court of Appeal had made no error of law in its construction of CPR Part 54 and Practice Direction 8C. It was correct to find that filing an acknowledgment of service is mandatory if a defendant or interested party wished to take part in a statutory or judicial review.

Further, there was nothing in the CPR to exclude an award of costs for the preparation of the acknowledgment of service. While CPR Part 54 established a general practice in relation to the award of costs for attending the oral permission hearing, it was silent on the cost of preparing the acknowledgement of service.

This article was based largely on the Supreme Court’s press summary.

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