Friends Of The Earth Ltd & Anor v Secretary Of State For Environment, Food & Rural Affairs & Ors

On an unsuccessful appeal involving public interest groups, the court may exceptionally make no order for the appeal costs where the public importance of the issues is substantial and the appellants have succeeded on an important point of principle, correcting an error in the decision below. That outcome does not establish general immunity for public interest groups. The court may also consider whether the respondents’ arguments materially prevailed and whether separate sets of costs would be justified, having regard to the circumstances of the litigation.

The appellants challenged a decision of the Queen’s Bench Division, presided over by Mr Justice Collins. The appeal was unsuccessful overall, but the Court of Appeal considered that the appellants had established an important point of principle concerning the treatment of capital costs.

The judgment concerned the consequential issue of costs in the appeal. The court considered whether to order no costs, one set of costs, or two sets of costs in favour of the respondents.

1. Appeal dismissed. The court made no order for the costs of the appeal.
2. Two sets of costs would be highly unusual. The court considered the decision in Bolton Metropolitan District [1995] 1 WLR 1176, where two sets had been ordered, but regarded the circumstances as materially different. The appellants were public interest groups, unlike the unsuccessful parties in Bolton, who comprised local authorities supported financially by substantial commercial interests.
3. The court identified two special features. The public interest in public health and well-being was exceptionally important and justified ensuring that the issues were properly examined. In addition, although unsuccessful overall, the appellants had succeeded on an important point of principle concerning whether capital costs ordinarily fell to be brought into account, thereby correcting an error in the main ground of the decision below.
4. The court did not disturb the order for costs below. The appellants therefore remained liable for their own costs and the costs payable to the Secretary of State below. It nevertheless considered it inappropriate to impose further appeal costs.
5. The result was expressly described as highly exceptional and was not intended to suggest that public interest groups would generally be immune from adverse costs orders on appeal.

• Court of Appeal (Civil Division): Appeal from the Queen’s Bench Division dismissed. The order for costs below was left undisturbed, but there was no order for the costs of the appeal.