IN THE HIGH COURT OF JUSTICE CO/4050/99
QUEEN'S BENCH DIVISION
(CROWN OFFICE LIST)
Royal Courts of Justice
Tuesday 26th October 1999
B e f o r e:
MR JUSTICE RICHARDS
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LONDON BOROUGH of HAMMERSMITH and FULHAM
EX PARTE CPRE LONDON BRANCH
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MR ROBERT McCRACKEN (instructed by RICHARD BUXTON, 40 CLARENDON ST, CAMBRIDGE, CB1 1JX) appeared on behalf of the Applicants.
MR A DINKIN QC (instructed by LEGAL DEPT. LONDON BOROUGH OF HAMMERSMITH and FULHAM) appeared on behalf of the First Respondents.
MR T STRAKER QC (instructed by BERWIN LEIGHTON, LONDON EC4R 9HA) appeared on behalf of the Second Respondents.
J U D G M E N T
(As approved by the Court)
Tuesday, 26th October 1999
RULING AS REGARDS COSTS
MR JUSTICE RICHARDS: I have just granted permission to apply in the case in respect of one of the decisions that was sought to be challenged. I have agreed, with the consent of all parties, to hear an application by Mr McCracken in relation to the costs of the future proceedings, despite the fact that no proper notice had been given.
Mr McCracken submits that the court should make an order that neither side, by which I think he means none of the parties to the proceedings, should have to pay more then ten per cent of their annual turnover to the successful party by way of costs at the end of the day. The reason why that application is made is that on the CPRE's own evidence their annual turnover is something under £40,000 and the affidavit of the director of the London branch is to the effect that it will be very difficult for them to continue the litigation without external support if there is a liability for the costs of the other side at the end of the day. I have heard Mr McCracken's application but have not thought it necessary to call upon Mr Dinkin or Mr Straker in reply.
What the applicant seeks is a different and more limited pre-emptive order than that which was under consideration in the case of R V Lord Chancellor ex parte CPAG  2 All ER 755. Nevertheless the application, in my judgment, engages the same principles as were there laid down; Mr McCracken has indeed made his submissions by reference to the principles laid down in that case. He has rightly reminded me of the overriding objective in part one of the Civil Procedure Rules. It does not seem to me that the overriding objective there laid down affects or undermines the principles expounded by Mr Justice Dyson in ex parte CPAG and I did not understand Mr McCracken to contend to the contrary. He did, however, submit, and I accept, that in exercising my discretion with regard to costs, as in relation to other matters under the rules, I should seek to give effect to the overriding objective and should have particular regard to the need, so far as practicable, to ensure that the parties are on an equal footing and that the case is dealt with in a way which is proportionate to the financial position of each party. Those aspects of the overriding objective seem to me to be embedded in any event in the principles laid down in ex parte CPAG.
What that case makes clear, and I think it entirely right to follow it in this respect, is that pre-emptive costs orders, which involve a departure in advance from the ordinary rules with regard to costs and the ordinary exercise of the court's discretion with regard to costs at the end of the day, should be made only in the most exceptional circumstances. The question for me is whether this case is one of those truly exceptional cases where such an order would be justified. Even assuming that this is truly public interest litigation of the kind to which ex parte CPAG was directed, it seems to me that the case is not one of the most exceptional cases that would justify the making of a pre-emptive cost order.
Looking at what is said by Mr Justice Dyson at 766h-j, he sets out the following criteria or conditions for the making of a pre-emptive costs order in a public interest challenge case. First, that the court is satisfied that the issues raised are truly ones of general importance. Secondly, that it has a sufficient appreciation of the merits of the claim that it can conclude it is in the public interest to make the order. Thirdly, the court should have regard to the financial resources of the applicant and the respondent and the amount of the costs likely to be in issue and it would be more likely to make an order where the respondent clearly has a superior capacity to bear the costs of the proceedings than the applicant and where it is satisfied that unless the order is made the applicant would probably discontinue the proceedings and will be acting reasonably in so doing.
The present challenge, to the extent that I have given permission for it to proceed, raises an interesting question of Community law in relation to an important directive in the environmental field. The case can, I think, properly be regarded as one of general public importance. But having regard to the perceived merits of the case I do not think it in the public interest to make the order sought. I have held that the matters put forward on behalf of the applicant are arguable, but I have also indicated in my judgment that the applicant faces substantial problems, especially in so far as the case is put on the basis of a duty to exercise the power under section 97 rather than a duty merely to consider the exercise of that power. I recognise that there are in this case unequal resources, though it is fair to note that the respondent council is, no doubt, subject itself to very tight financial constraints and cannot view the prospect of substantial litigation lightly. I reject the notion that the proposed order whereby no party would have to pay more than ten per cent of its annual turnover is entirely proportionate. It seems to me self-evidently to give substantially greater practical protection to the applicant than to the respondent or to interested parties.
I am not satisfied that without the order sought the applicant would probably abandon the proceedings. I well understand the difficulties of funding litigation of this sort. I recognise the financial limitations of the applicant. Whether it can gain financial support from other bodies or from individuals among its membership or from the aggregate of its membership is, as it seems to me, an open question. There is no evidence on that before the court, for reasons that are entirely understandable, given that I have been asked to consider this matter immediately after the grant of permission. But as things stand I do not feel able to conclude that it would be impossible for the applicant to fund the proceedings or that, in consequence, they will abandon the proceedings. It is, as I say, to my mind an open question.
Finally, I do not accept Mr McCracken's submission that the judgment of the European Court of Justice in the case of Kraiijveld, to which I have referred in my main judgment and upon which Mr McCracken places remarkably heavy reliance at all stages, as it seems to me, of his argument before me today, entails the extreme conclusion that if an applicant dropped out the court would have to pursue a challenge in some way of its own motion or that in order to avoid that extraordinary situation the court would have to construct a position by way of appropriate costs orders that would enable the applicant to continue if otherwise he were minded to drop out. It seems to me that Kraiijveld has the limited significance that I indicated in my previous judgment and that it cannot be deployed in support of the contention that the court is somehow under a duty as a matter of Community law to make a pre-emptive costs order of the kind that Mr McCracken seeks.
Accordingly, the application is refused.
(Further discussions followed re Security Application)