Workshop: Costs in environmental cases: the new regime

New rules added to CPR Part 45 with effect from 1 April 2013 give increased certainty to practitioners advising clients on the likely costs of environmental judicial reviews. The key question will be whether or not the new rules apply. If so, an automatic costs capping regime applies. If not then it is still possible to seek costs protection under the common law rules.

Caught by the rule

The new rules apply to 'Aarhus Convention claims' (CPR 45.41), i.e. to judicial review cases where the Aarhus Convention applies. Cases involving recognised 'environmental' provisions of European law - for example, Environmental Impact Assessment - will clearly fall within this provision.

It remains somewhat unclear whether other judicial reviews - for example a judicial review of a planning permission for a neighbour's extension, raising no obvious 'environmental' points - will be caught. The Aarhus Convention says that it applies to "environmental matters", but does not further define this term. However, the expression "environmental information" is defined broadly and has been interpreted expansively by domestic tribunals in the context of the Environmental Information Regulations 2004. This would suggest a similarly wide ambit for the costs rules.

Tactical considerations

Where the claimant has asserted that the claim is an 'Aarhus Convention claim', the new rules apply automatically unless the defendant challenges the assertion. If there is a challenge, it is to be resolved "at the earliest opportunity" (CPR 45.44(2)). If the defendant is successful, the court will "normally" make no order for costs in respect of these proceedings, whereas if the claimant is successful the defendant will "normally" be ordered to pay costs on the indemnity basis. This creates a strong incentive for claimants to assert that the rules apply, as they have little to lose; defendants should be more cautious about challenging their application.

Where the rules apply, the claimant may not be ordered to pay more than £5,000 if an individual, or £10,000 in other cases. The defendant may not be ordered to pay more than £35,000. These limits appear to be absolute.

It is possible for a claimant to 'opt out' of these limits, however, which may prove to be an attractive option for large commercial claimants which do not wish to be bound by the £35,000 reciprocal cap and are happy to forgo the costs protection provided by the'¨new rules.

Even if the new rules do not apply, the claimant can still apply for a protective costs '¨order under Corner House principles or can incorporate and provide security for costs. If a defendant has indicated that it intends to dispute the application of the new rules, a claimant would be well advised to make any PCO application in the alternative with its assertion that the claim is an Aarhus Convention claim. Otherwise there is a risk of a further round of costly satellite litigation. SJ