Kerry Underwood

CAPPED COSTS AND PERCENTAGE ORDERS IN JUDICIAL REVIEW PROCEEDINGS

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

 

In

Elan-Cane, R (on the application of) v The Secretary of State for the Home Department & Anor [2020] EWCA Civ 363

the Court of Appeal held that a percentage reduction to a costs award could be made to a capped costs sum, rather than the actual sum, in a case concerning the engagement, of Article 8 of the European Convention on Human Rights, the right to respect for private life.

The Court of Appeal unanimously dismissed the appellant’s appeal in the substantive case, holding that the Secretary of State for the Home Department could refuse to allow an application for a passport with an “X” marker in the gender field to indicate unspecified gender.

The parties had agreed to cap costs at £3,000 each by consent order.

After refusing permission to the appellant on the Article 8 challenge, the High Court ordered the appellant to pay £2,000 for the respondent’s costs, being a 33% reduction to capped costs as the appellant was partially successful in establishing the engagement of Article 8.

The respondent argued that the reduction should apply to actual costs and not capped costs, so that the court should initially consider costs, including any deductions, as though the cap did not exist and apply the cap afterwards.

 

“128. On the figures in the present case, the amount at stake on this issue is only £1,000. But the question is of potentially wider significance in all cases where a costs capping order has been made in connection with public interest judicial review proceedings by the High Court or the Court of Appeal under sections 88 to 90 of the Criminal Justice and Courts Act 2015 (“the 2015 Act”), or (as here) the parties have agreed to a costs capping order in lieu of an order under those sections. Since the irrecoverable costs of the SSHD in such cases are in effect funded by the taxpayer, the SSHD understandably wishes the question of principle to be tested. Permission to appeal was granted by Bean LJ on 20 December 2018.”

 

The court observed that costs capping under the Criminal Justice and Courts Act 2015 promoted access to justice in public interest proceedings at the expense of parties’ potentially irrecoverable costs, and this policy should inform the entire costs exercise in such proceedings.

No rule or principle was precluding a percentage reduction to a capped costs amount.

It might encourage “lax practice or unreasonable litigation conduct” if the successful party knew that it would receive all its capped costs, even if there were factors that would justify a substantial reduction of its uncapped costs.

 

“131. So far as material, sections 88 and 89 of the 2015 Act provide as follows:

88Capping of costs

(1) A costs capping order may not be made by the High Court or the Court of Appeal in connection with judicial review proceedings except in accordance with this section and sections 89 and 90.

(2) A “costs capping order” is an order limiting or removing the liability of a party to judicial review proceedings to pay another party’s costs in connection with any stage of the proceedings.

(3) The court may make a costs capping order only if leave to apply for judicial review has been granted.

(4) The court may make a costs capping order only on an application for such an order made by the applicant for judicial review in accordance with rules of court.

(5) Rules of court may, in particular, specify information that must be contained in the application, including –

(a) information about the source, nature and extent of financial resources available, or likely to be available, to the applicant to meet liabilities arising in connection with the application,

(6) 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.

(7) The proceedings are “public interest proceedings” only if –

(a) an issue that is the subject of the proceedings is of general public importance,

(b) the public interest requires the issue to be resolved, and

(c) the proceedings are likely to provide an appropriate means of resolving it.

89. Capping of costs: orders and their terms

(1) The matters to which the court must have regard when considering whether to make a costs capping order in connection with judicial review proceedings, and what the terms of such an order should be, include –

(a) the financial resources of the parties to the proceedings, including the financial resources of any person who provides, or may provide, financial support to the parties;

(b) the extent to which the applicant for the order is likely to benefit if relief is granted to the applicant for judicial review;

(c) the extent to which any person who has provided, or may provide, the applicant with financial support is likely to benefit if relief is granted to the applicant for judicial review;

(d) whether legal representatives for the applicant for the order are acting free of charge;

(e) whether the applicant for the order is an appropriate person to represent the interests of other persons or the public interest generally.

(2) A costs capping order that limits or removes the liability of the applicant for judicial review to pay the costs of another party to the proceedings if relief is not granted to the applicant for judicial review must also limit or remove the liability of the other party to pay the applicant’s costs if it is.

…””

The relevant rules of court are contained in CPR 46.16 to 46.19 and Practice Direction 46, paragraphs 10.1 and 10.2.

Written by kerryunderwood

March 23, 2020 at 12:10 pm

Posted in Uncategorized

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