CPR Aarhus costs rules – proposed changes

Fri, 18 Sep 2015

On 17th September 2015, the Ministry of Justice issued a consultation paper on proposed changes to Section VII of CPR Part 45, concerning costs protection in environmental claims.  Jenny Wigley briefly considers the main changes proposed.

Simply put, one of the aims behind the Aarhus Convention is to ensure that the public is not deterred by financial considerations from bringing litigation to protect the environment, in circumstances where the environment plainly cannot protect itself.

In an attempt to implement Aarhus, which broadly requires that legal challenges to decisions affecting the environment should not be “prohibitively expensive,” Part 45 of the CPR currently provides that judicial review claimants are entitled to limits to their potential adverse costs liability to defendants in cases concerning environmental matters. 

The current limits are £5,000 for individual claimants and £10,000 for organisations, with a reciprocal cap on the liability of the defendant to the claimant of £35,000.  The procedure requires that claimants make it clear in their claim form if they consider their claim to be eligible for this cost capping, namely an “Aarhus Convention claim”.  The defendant has an opportunity to dispute whether the claim is an Aarhus Convention claim in its Acknowledgment of Service.  If there is such a dispute, it is to be resolved by the Court at the “earliest opportunity”.  If the defendant is unsuccessful in such a challenge, the usual order is that it has to pay the Claimant’s costs on an indemnity basis. 

Thus, in judicial review claims concerning environmental matters (but not statutory review claims), claimants have, at a very early stage in the proceedings, a reasonable degree of certainty as to their likely costs exposure, should they lose.  

The recently issued consultation paper proposes changes to this procedure.  First, the automatic costs capping provided under Part 45 is to be extended beyond just judicial review claims, to statutory review environmental claims.  The Court of Appeal in Secretary of State v. Venn ([2014] CA Civ 1539) made it clear that the current rules are anomalous and contrary to the Convention because they exclude challenges to planning appeal decisions (which are brought under statutory review provisions) from the automatic costs protection.  The proposals in the consultation paper are designed to resolve this.

However, consistent with the Government’s aim to reduce the scope for developments to be held up by would be legal challenges, the majority of the other proposals in the consultation paper are designed to reduce, rather than extend, the costs protection to would be claimants from the current CPR 45 position.  In summary, the proposals include the following restrictions on the ability of claimants to benefit from costs protection:

-       Duty on claimants to provide schedule of financial resources at the outset, including financial support from others;

-       Intention to restrict the benefit of the provisions to “members of the public” as defined, so as to exclude proceedings brought by public authorities;

-       Possibly raising the standard cost caps to £10,000 for individuals, £20,000 for organisations and reducing the reciprocal cap to £25,000;

-       Power to the Court “at any time”, to remove or vary the level of cost capping, so long as it is satisfied that to do so would not make the proceedings “prohibitively expensive” for the claimant in terms of exceeding the claimant’s resources, or objectively unreasonable, having regard to various prescribed factors;

-       Only allowing the Court to reduce the claimant’s costs cap to below the standard levels if the case is “exceptional” in that it would otherwise be prohibitively expensive for the claimant;

-       Making it easier for defendants to challenge whether a claim is eligible by removing the default provision for the defendant to pay indemnity costs should its challenge to eligibility fail;

-       Making it clear that the provisions do not apply to appeals, other than specific appeals akin to statutory reviews, such as appeals against enforcement decisions under s.289 of the Town and Country Planning Act 1990

Following a 12 week consultation period, it is intended that the Civil Procedural Rules Committee will implement the proposed changes, as amended if appropriate as a result of the consultation responses. 

The proposed changes rectify some problems with the current rules, by extending their scope beyond just judicial review.  However, as they stand, the proposals would drastically reduce the costs certainty currently afforded to judicial review claimants in environmental claims and may fall foul of the purpose behind the Aarhus Convention in that respect.  The wide scope for the Court to remove or vary the level of cost capping at any time in the proceedings is likely to be particularly problematic for claimants.

Please click here to view Jenny Wigley's profile.

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