Kerry Underwood

COSTS CAPPING ORDER IN CROWDFUNDED JUDICIAL REVIEW

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In Stephen Hawking and Others v Secretary of State for Health and Social Care and National Health Service Commissioning Board

the High Court granted a costs capping order in judicial review proceedings financed by crowdfunding.

The court held that costs certainty in respect of claimants bringing a claim in the public interest was a key factor, even though the individuals were of relatively significant means and had crowdfunded to meet their own lawyers’ costs as well as any Adverse Costs Order.

The court recognised that where a judicial review application is crowdfunded, the public is funding both sides: the government by tax payers and the claimants by crowdfunding.

The court also noted that crowdfunding is inherently uncertain and the certainty provided by a costs capping order was necessary to enable individuals to take a public interest case forward.

The order was not for the full amount of the money raised, thereby enabling the claimants’ lawyers own costs to be met.

At an oral hearing on 22 February 2018 the High Court overturned a paper ruling rejecting the application and held that this judicial review, funded by thousands of backers on CrowdJustice, met the statutory test set out in Section 88(6) of the Criminal Justice and Courts Act 2015 which provides that the court may make a costs capping order only if it is satisfied that –

“(a) the proceedings are public interest proceedings,

(b)  in the absence of the order, the applicant for judicial review would withdraw the application for judicial review or cease to participate in the proceedings, and

(c) it would be reasonable for the applicant for judicial review to do so.”

 

The court took into account the fact that the defendants’ costs were very high and without a costs cap there could be no certainty for the claimants as to their potential exposure and they could not be criticised as being unreasonable in not proceeding with open ended potential liabilities.

The claimants needed certainty to inform them of fundraising targets and to allow them to make an informed decision on whether to proceed.

The claimants were willing to meet a substantial degree of the defendants’ costs by raising money through crowdfunding.

The case of

 

Corner House (R on the application of Corner House Research) v Secretary of State for Trade and Industry [2005] EWCA. Civ 192

 

anticipated a variety of circumstances in which costs capping orders could be made, and not just where there was a single claimant of very modest means.

The court made a costs capping order of £80,000.00 in respect of each of the defendants’ costs, £160,000.00 in total, and a reciprocal cap of £115,000.00 in respect of the claimants’ costs.

The claimants had raised nearly £265,000.00 after three rounds of crowdfunding and private donations and so the decision allowed for funds to meet the costs of the claimants’ own lawyers.

 

 

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Written by kerryunderwood

May 8, 2018 at 10:30 am

Posted in Uncategorized

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