Case No: C1/2007/0780
Neutral Citation Number:  EWCA Civ 1201
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN'S BENCH DIVISION
(MR JUSTICE OWEN)
Royal Courts of Justice
Strand, London, WC2A 2LL
Date: Tuesday 27th October 2009
LORD JUSTICE WALLER
LADY JUSTICE ARDEN
LORD JUSTICE MOORE-BICK
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The Queen on the application of MELLOR
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SECRETARY OF STATE FOR COMMUNITIES
AND LOCAL GOVERNMENT
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(DAR Transcript of
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Mr Richard Harwood (instructed by Richard Buxton Solicitors) appeared on behalf of the Appellant.
Mr James Maurici (instructed by the Treasury Solicitor, Harrogate Borough Council, Wansboroughs) appeared on behalf of the Respondent.
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(Draft for Approval)
Lord Justice Waller:
1. By an order made on 21 January 2008 this court referred seven questions to the European Court of Justice, and those questions have now been answered by that court. Things have moved on and two points arise: have they moved on so far that there is nothing more for this court to do but deal with costs? And, so far as costs are concerned, what is the appropriate order to make?
2. The background and history so far as relevant is as follows. In October 2004 Partnerships in Care ("PIC") lodged a planning application with Harrogate Borough Council for permission to construct a medium secure hospital at HMS Forest Moor on a site in open countryside and an area of outstanding natural beauty. Planning permission was granted but then quashed on the ground that the council had failed to adopt an EIA screening opinion. In July 2006 PIC's consultants applied for a screening opinion and residents of the area, including Mr Mellor, wrote arguing that an EIA was required. On 25 August the council initially concluded no screening opinion was necessary but they changed their mind and, on the basis of information provided by Mr Mellor, concluded on 23 October 2006 that an EIA was required.
3. However, on 4 December 2006 the Secretary of State to whom the matter had been referred decided no EIA should be required. So far as material, the decision was in the following terms:
"..in the opinion of the Secretary of State, and having taken into account the selection criteria in Schedule 3 to the 1999 Regulations and the representations made by Mr C Mellor on behalf of Residents for the protection of Nidderdale, the proposal would not be likely to have significant effects on the environment by virtue of factors such as its nature, size or location."
That reasoning simply followed the language of the Regulations.
4. Mr Mellor brought judicial review proceedings but immediately requested the High Court to refuse permission to apply for judicial review so that the matter could be brought to the Court of Appeal. The reason for that was that the Court of Appeal had decided in Rv SSE ex parte Marson  Env LR 761 that reasons did not have to be given for refusing to direct that an EIA was required and, if they did have to be given, then the Secretary of State's reasons in that case were adequate.
5. The Secretary of State resisted Mr Mellor's application that permission should be refused, but Owen J refused permission and ordered the Secretary of State to pay the costs of that hearing. Mr Mellor was given permission to appeal and to apply for judicial review in the Court of Appeal by Auld LJ, that to be joined with a case at that stage in the Court of Appeal called R(Probyn) v SSCLG  EWHC 398 (Admin), which raised the same point.
6. The parties (that is, both Mr Mellor and the Secretary of State) asked the Court of Appeal to refer questions to the European Court of Justice, and a court composed of myself, Arden LJ and Toulson LJ agreed to do that. The questions were drafted and the schedule was also drafted and the request went.
7. The court ultimately ruled on the three questions in the following terms at paragraphs 64 and 65 of its judgment :
"64. Article 4 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, as amended by Directive 2003/35/EC of the European Parliament and of the Council of 26 May 2003, must be interpreted as not requiring that a determination, that it is unnecessary to subject a project falling within Annex II to that directive to an environmental impact assessment, should itself contain the reasons for the competent authority's decision that the latter was unnecessary. However, if an interested party so requests, the authority is obliged to communicate to him the reasons for the determination or the relevant information and documents in response to the request made.
65. If a determination of a Member State not to subject a project, falling within Annex II to Directive 85/337 as amended by Directive 2003/35, to an environmental impact assessment in accordance with Articles 5 to 10 of that directive, states the reasons on which it is based, that determination is sufficiently reasoned where the reasons which it contains, added to factors which have already been brought to the attention of interested parties, and supplemented by any necessary additional information which the competent national administration is required to provide to those interested parties at their request, can enable them to decide whether to appeal against that decision."
8. During this year however various things have happened. First of all, two further screening directions were given, thus rendering the original screening direction irrelevant; but in addition the planning application has now been withdrawn. Thus the present position is that the 2006 screening direction, the relevant direction so far as these proceedings are concerned, has been superseded and the questions which were addressed to the ECJ are academic so far as these particular proceedings are concerned. Thus the issues which arose for today were, first, the question whether despite the academic nature of the position some declaration should be granted in relation to the 2006 screening direction and, second, what should happen in relation to costs.
9. I indicated at the commencement of the argument today that the court's inclination was not to grant a declaration, that it seemed to us sufficient that we should make clear that what the European Court of Justice has ruled is now the law and is different from that which was declared to be the law in Marson. I said that it seemed to us that the appropriate course was for us simply to make clear that Marson (which it is right to say was actually a Court of Appeal decision given on permission to appeal and therefore, in one sense not binding, but nonetheless clearly offering guidance in this area) must now be looked at in the context of the answers given by the European Court of Justice in this case. We thought that it was, in those circumstances not right to make any declaration, since before doing so the court would have to go into the details of a case, which was now academic. Mr Harwood did not press for the making of a declaration and thus that issue no longer arises.
10. The question of costs has been debated more hotly. What we are required to ascertain is, first of all, whether one party has succeeded or whether neither has. We must also look at the conduct of the parties generally in order to ascertain what has generated the costs that have been incurred.
11. So far as the successful party is concerned, the competing arguments are really these. What the Secretary of State says through Mr Maurici is that one must examine what the appellant's case was, what the judgment of the European Court of Justice has then decided and then one is entitled to look at what happened after the decision of the European Court of Justice in order to see who was the effective winner. What he drew our attention to was the fact that in the grounds requesting judicial review what was being asserted on Mr Mellor's behalf was that the decision itself did not contain reasons and it was for that reason that the decision was unlawful. He then took us to the judgment of the European Court and he said that, when one examines what the European Court decided, one sees that they made clear that it was not necessary for a decision itself to contain the reasons, but they were saying a person interested would be entitled to request reasons or other information. Then there was an obligation on the decision-taker to supply reasons on that request. He says what is more, if one looks at the particular decision in this case, paragraph 65 of the European Court of Justice ruling would indicate that it would not necessarily be held that the reasons given in this case (i.e. the decision as expressed in the decision letter) were inadequate.
12. So far as that last point is concerned, it seems to me that paragraph 65 is simply saying that the court, without knowing what other information a party has or what other information might be supplied to fill the gaps in the reasoning, was not prepared to hold that the reasons given in this case were not sufficient. It would seem to me reasonably clear that if the Secretary of State were arguing before the court that the reasons given in that decision letter alone were sufficient, the court would be inclined to say, to the contrary, and that there would need to be other information and other reasoning supplied.
13. But in any event what Mr Maurici was arguing was, in effect, that the Secretary of State had won or at worst there was a draw.
14. Mr Harwood submitted Mr Mellor was the successful party. He first took us to the correspondence that preceded the action i.e. the first letter, the protocol letter, which was that of 8 December 2006 and the Grounds of Challenge. He pointed out that the Grounds of Challenge in that letter related to the provision of reasons generally.. The Grounds of Challenge did not confine themselves to suggesting that the reasons had to be in the letter itself. What is more, by a second letter, what was being identified as matters that were not clear from the reasons given related to the representations of the council and whether those had been taken into account, a matter which was not clear from the decision letter.
15. What the solicitors acting for Mr Mellor received back was a letter of 22 December 2006 and in that letter there is no doubt that the main point taken by the Treasury Solicitor was that there was no duty to give reasons at all, relying very much on the Marson reasoning. In essence what the Treasury solicitor was saying was that the fact the decision letter did not expressly refer to the representations of the council was irrelevant because there was no evidence to support a contention that the Secretary of State failed to take into account the views of the council.
16. So Mr Harwood submitted that really, by implication, Richard Buxton on behalf of Mr Mellor was requesting reasons and what was being said by the Treasury Solicitor was that they were under no duty to give them and that is the stance that they were taking.
17. Ultimately, it is right to say that post the ECJ decision a letter was written to the Treasury Solicitor requesting the provision of detailed reasons. The response to that letter, dated 3 September 2009, was the supply of a quantity of material. Perhaps the key document supplied at that time was a document dated 1 December 2006 which, as appears from the document itself, shows that a detailed assessment was being made in December 2006, and shows what factors were being taken into account in reaching a decision at that time. It for example would indicate the extent to which the views of the council were being taken into account.
18. It seems to me that there are two bases on which the Secretary of State should be ordered to pay the costs of Mr Mellor. First, as it seems to me, if one stands back from what happened in this case, the Secretary of State was choosing to rely on the decision in Marson and say there was no obligation to provide reasons of any sort whether in the decision letter or not. It was that question that was ultimately taken to the European Court and the European Court has ruled against the Secretary of State on that point. Thus, as it seems to me, the Secretary of State is in fact the loser. Although it is right that in the grounds for seeking permission, Mr Mellor was suggesting the reasons should be in the decision letter, as it seems to me, looking at the matter fairly, what Mr Mellor and those with him have been actually suggesting is that what are needed are reasons and they were not simply taking a point that they should be in the decision letter.
19. But perhaps as relevant and, indeed, possibly demonstrating the first point, when Richard Buxton on behalf of Mr Mellor sent his pre-action letter on 8 December 2006 seeking reasons, there was actually in the possession of the Secretary of State a document, ultimately supplied, dated 1 December 2006. It would have been very simple to have prevented any of the costs that have actually been incurred in taking this matter to the ECJ simply to have supplied that document. It could have been made clear that, albeit there was no obligation on the Secretary of State to supply reasons (see Marson), in order to prevent there having to be litigation on that aspect, here was a document which supplied the further information and reasons. But the Secretary of State chose not to do so. By virtue of those two points it seems to me that the appropriate order to make in relation to the costs is that Mr Mellor should have his costs in this court and the costs of the litigation in the ECJ.
Lady Justice Arden:
20. I agree.
Lord Justice Moore-Bick:
21. I also agree.
Order: Appeal allowed and the Secretary of State to pay the costs of the litigation.