Buglife - The Invertebrate Conservation Trust, R (on the application of) v Thurrock Thames Gateway Development Corp (Rev 1)

A protective costs order should be determined by the Corner House requirements and all the circumstances. There is no separate exceptionality criterion. The tests of general public importance and a public interest in resolution overlap and should be applied flexibly.

Where a protective costs order limits a claimant’s exposure but permits recovery of costs if successful, the claimant’s recoverable costs will generally be limited to a reasonably modest sum. The court must know the actual conditional-fee success fee when fixing that cap. A cap on the claimant’s liability does not create any presumption that the defendant’s liability should be capped at the same amount. Each cap depends on the justice and fairness of the case.

Buglife sought judicial review of planning permission for a distribution hub at West Thurrock. It contended that development would harm a nationally important invertebrate habitat. Sullivan J made a protective costs order which capped both Buglife’s liability for costs and the respondent’s liability for Buglife’s costs at £10,000.

Mitting J dismissed the judicial review claim: [2008] EWHC 475 (Admin). After permission to appeal against that dismissal was granted, Buglife sought a further appellate protective costs order and permission, out of time, to challenge the reciprocal cap imposed by Sullivan J. The central issues were whether costs protection should extend to the appeal and whether the reciprocal first-instance cap should be removed.

1. The application for permission to appeal against Sullivan J’s reciprocal cap was refused. There was no error of principle in his discretionary order and no compelling reason to revisit it. The challenge should in any event have been brought before the substantive judicial-review hearing.

2. Protective costs order granted for the appeal. Buglife was entitled to some appellate protection, but its prospects on the merits were not strong. Full protection would be unjust. Its liability for the respondent’s appellate costs was therefore capped at £10,000.

3. The governing requirements were those in R (Corner House Research) v Secretary of State for Trade and Industry [2005] EWCA Civ 192, as explained by the majority reasoning in R (Compton) v Wiltshire Primary Care Trust [2008] EWCA Civ 749. No additional exceptionality test applies. The judge must apply the five requirements flexibly and assess the extent to which they are met, together with all the circumstances.

4. A costs cap in favour of a claimant who may recover costs if successful will generally be reasonably modest and include any conditional-fee additional liability. There is no absolute rule excluding leading counsel, but the court remained bound by the flexible Corner House guidance. The actual agreed success fee was relevant and should be known when fixing a cap.

5. There was no presumption that the respondent’s cap should equal Buglife’s cap. Nevertheless, the justice of this case, including the merits and the respondent’s public status, justified a reciprocal appellate cap of £10,000. The court therefore granted the respondent’s counter-application. It proceeded on the assumption that Buglife would have no costs liability to the developer, but was willing to provide further protection if that assumption proved wrong.

• Court of Appeal (Civil Division): Buglife’s application to challenge Sullivan J’s reciprocal cap was refused. Its and the respondent’s appellate costs liabilities were each capped at £10,000: [2008] EWCA Civ 1209.
• Administrative Court: Mitting J dismissed Buglife’s judicial-review claim and refused permission to appeal: [2008] EWHC 475 (Admin).
• Administrative Court: Sullivan J made a protective costs order before the rolled-up hearing, capping each side’s first-instance costs liability at £10,000.