The European Court of Justice today handed down judgment in the reference made by the Supreme Court in R. (Edwards & another) v Environment Agency & Others  UKSC 57;  1 W.L.R. 79.
The case involves consideration of whether in relation to costs in cases covered by what were then the EIA and IPPC Directives (and implementing in part Article 9 of the Aarhus Convention) the assessment of whether litigation is or is not “prohibitively expensive” to be decided on an ‘objective’ basis by reference (for example) to the ability of an ‘ordinary’ member of the public to meet the potential liability for costs, or should it be decided on a ‘subjective’ basis by reference to the means of the particular claimant, or upon some combination of the two bases?
The questions referred by the Supreme Court were these:
“1. How should a national court approach the question of awards of costs against a member of the public who is an unsuccessful claimant in an environmental claim, having regard to the requirements of Article 9(4) of the Aarhus Convention, as implemented by article 10a 85/337/EEC and article 15a 96/61/EEC (‘the Directives’)?
2. Should the question whether the cost of the litigation is or is not ‘prohibitively expensive’ within the meaning of Article 9(4) of the Aarhus Convention as implemented by the Directives be decided on an objective basis (by reference, for example, to the ability of an ‘ordinary’ member of the public to meet the potential liability for costs), or should it be decided on a subjective basis (by reference to the means of the particular claimant) or upon some combination of these two bases?
3. Or is this entirely a matter for the national law of the Member State subject only to achieving the result laid down by the Directives, namely that the proceedings in question are not ‘prohibitively expensive’?
4. In considering whether proceedings are, or are not, ‘prohibitively expensive’, is it relevant that the claimant has not in fact been deterred from bringing or continuing with the proceedings?
5. Is a different approach to these issues permissible at the stage of (i) an appeal or (ii) a second appeal from that which requires to be taken at first instance?”
The Court ruled that:
“The requirement, under the fifth paragraph of Article 10a of Council Directive 85/337/EEC of 27 June 1985 on the assessment of the effects of certain public and private projects on the environment and the fifth paragraph of Article 15a of Council Directive 96/61/EC of 24 September 1996 concerning integrated pollution prevention and control, as amended by Directive 2003/35/EC of the European Parliament and of the Council of 26 May 2003, that judicial proceedings should not be prohibitively expensive means that the persons covered by those provisions should not be prevented from seeking, or pursuing a claim for, a review by the courts that falls within the scope of those articles by reason of the financial burden that might arise as a result. Where a national court is called upon to make an order for costs against a member of the public who is an unsuccessful claimant in an environmental dispute or, more generally, where it is required – as courts in the United Kingdom may be – to state its views, at an earlier stage of the proceedings, on a possible capping of the costs for which the unsuccessful party may be liable, it must satisfy itself that that requirement has been complied with, taking into account both the interest of the person wishing to defend his rights and the public interest in the protection of the environment.
In the context of that assessment, the national court cannot act solely on the basis of that claimant’s financial situation but must also carry out an objective analysis of the amount of the costs. It may also take into account the situation of the parties concerned, whether the claimant has a reasonable prospect of success, the importance of what is at stake for the claimant and for the protection of the environment, the complexity of the relevant law and procedure, the potentially frivolous nature of the claim at its various stages, and the existence of a national legal aid scheme or a costs protection regime.
By contrast, the fact that a claimant has not been deterred, in practice, from asserting his claim is not of itself sufficient to establish that the proceedings are not prohibitively expensive for him.
Lastly, that assessment cannot be conducted according to different criteria depending on whether it is carried out at the conclusion of first-instance proceedings, an appeal or a second appeal.”
Of course, new costs rules applicable to Aarhus claims were introduced into the CPR in April. These adopt a purely objective approach in relation costs in the High Court in such cases. The judgment in Edwards will though be of importance in considering the issue of costs on appeals in environmental cases, see CPR 52.9A. It will also fuel a debate as to whether the new rules applicable to Aarhus claims in the High Court have gone too far and now offer greater protection to claimants that EU law and the Aarhus Convention require.
The Edwards case will now return to the Supreme Court for further argument.
James Maurici QC appeared for the UK Government in the case.