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New costs rules in environmental cases

The new costs rules in Aarhus Convention claims enter into force today – 28 February 2017.

The new provisions apply only to claims commencing on or after 28 February 2017, and not to claims existing before that date: see the transitional provision in rule 13(3) of the Civil Procedure (Amendment) Rules 2017.

The key changes to CPR Part 45 are as follows:

(1) The costs limit extends beyond judicial reviews to include statutory reviews (see Venn v SSCLG [2015] 1 W.L.R. 2328).

(2) The costs limit is now only available to “one or more members of the public”, and not local authorities, which reverses the outcome of R. (on the application of HS2 Action Alliance Ltd) v Secretary of State for Transport [2015] P.T.S.R. 1025.

(3) To apply for the costs limit, a claimant must have “filed and served with the claim form a schedule of the claimant’s financial resources which takes into account any financial support which any person has provided or is likely to provide to the claimant and which is verified by a statement of truth”: CPR 45.42(1)(b).

(4) The court can vary or remove the costs limit if satisfied that—(a) to do so would not make the costs of the proceedings prohibitively expensive for the claimant; and (b) in the case of a variation which would reduce a claimant’s maximum costs liability or increase that of a defendant, without the variation the costs of the proceedings would be prohibitively expensive for the claimant: CPR 45.44(1)-(2).

CPR 45.44(3) provides that Proceedings are to be considered prohibitively expensive if their likely costs either—(a) exceed the financial resources of the claimant; or (b) are objectively unreasonable having regard to— (i) the situation of the parties; (ii) whether the claimant has a reasonable prospect of success; (iii) the importance of what is at stake for the claimant; (iv)the importance of what is at stake for the environment; (v) the complexity of the relevant law and procedure; and (vi) whether the claim is frivolous. These factors mirror those set out by the CJEU in R. (on the application of Edwards) v Environment Agency (C-260/11) [2013] 1 W.L.R. 2914.

When the court considers the financial resources of the claimant for the purposes of this rule, it must have regard to any financial support which any person has provided or is likely to provide to the claimant: CPR 45.44(4).

CPR 39.2(3)(c) makes provision for a hearing (or any part of it) to be in private if it involves confidential information (including information relating to personal financial matters) and publicity would damage that confidentiality.

Where a defendant disputes that the claim is an Aarhus claim and loses that dispute, it will now only need to pay the claimant’s costs of that dispute on the standard basis, rather than on the indemnity basis as was formerly the case: CPR 45.45(3)(b).

The new rules also make specific provision for appeals in CPR 52.19A, which provides that, in an appeal against a decision made in an Aarhus Convention claim, the court must— (a) consider whether the costs of the proceedings will be prohibitively expensive for a party who was a claimant; and (b) if they will be, make an order limiting the recoverable costs to the extent necessary to prevent this. As at first instance, when the court considers the financial resources of a party for the purposes of the appeal, it must have regard to any financial support which any person has provided or is likely to provide to that party.

The rules are being challenged in a judicial review by environmental charities including ClientEarth and Friends of the Earth. Andrew Parkinson of Landmark Chambers and David Wolfe QC of Matrix are acting for the charities, instructed by Leigh Day.

To resist the challenge, the Lord Chancellor will be represented by Charles Banner and Jacqueline Lean of Landmark Chambers.