The High Court has refused to make a costs order requiring the Home Office to pay almost £150,000 in litigation costs to seven local authorities that pursued a judicial review challenge of the department's Voluntary Asylum Dispersal Policy.
In September 2021, the seven councils – Birmingham, Coventry, Dudley, Sandwell, Walsall, Wolverhampton and Stoke-on-Trent –suspended their participation in the then voluntary scheme after they said repeated attempts to urge the Home Secretary to immediately review and reform the original policy had failed.
However, in May of this year, the councils said they had withdrawn their legal challenge following a new Home Office policy that would mandate all local authorities in England, Scotland and Wales to accommodate asylum seekers.
Despite withdrawing their judicial review claim, the local authorities sought a costs order from the High Court that would have seen the Home Office pay the entirety of the costs of the judicial review proceedings – some £149,000 including VAT – on an indemnity basis.
In City of Wolverhampton Council & Ors, R (On the Application Of) v Secretary of State for the Home Department  EWHC 1721, the local authorities argued that, as the policy they had challenged in their pre-proceedings had been replaced by a new policy they supported, they had in substance achieved what they set out to achieve. In light of the new policy, they were the successful party and should therefore recover their costs.
They also argued that the new policy was "unexplained, except by reference to the legal challenge". They asserted that the litigation and the timing of the hearing triggered the policy change.
However, the Home Secretary argued that there should be no order as to costs as the circumstances did not support the contention that the judicial review challenge "caused or contributed to the change of policy". The claim had been "overtaken by events", there had been a "supervening event", and the claim was not conceded.
Mr Justice Fordham did not accept the local authorities' submissions that it would be appropriate to make a costs order in their favour in the circumstances of this case, "still less to order costs on an indemnity basis".
"I have concluded that the new policy adopted in April 2022 was one which was adopted as being the right policy, on the policy merits, in light of all relevant considerations regarding asylum dispersal arrangements, including supply issues and demand issues," the judge added.
"It was not, in my assessment, caused or materially contributed to by the fact of the judicial review claim or the Defendant's perception as to risk of defeat in the judicial review proceedings."
In concluding, the judge found that the appropriate order was that there be no order as to costs.