Bakhtiyar, R (on the application of) v The Secretary of State for the Home Department (Costs on AoS)

A successful defendant who files an acknowledgement of service in judicial review proceedings may recover the reasonable costs of considering whether to contest the claim and of preparing summary grounds. The costs of an employed solicitor are assessed on the same basis as those of a privately retained solicitor, subject to the indemnity principle.

Where the nominal defendant is a Secretary of State, the litigant is the government or Crown. Internal charges between government departments do not establish the government’s recoverable costs or a breach of the indemnity principle. On summary assessment, a claimed hourly rate will stand unless it is shown to be unreasonable or disproportionate.

The applicant sought judicial review shortly before proposed removal from the United Kingdom. A stay was initially granted, but Judge Storey later refused permission and ordered the applicant to pay the Secretary of State’s costs of filing an acknowledgement of service and summary grounds, summarily assessed at £400.

The Government Legal Department accepted that the time claimed should be reduced to one hour and twelve minutes. The remaining dispute concerned its hourly rate of £200. The applicant contended that the rate breached the indemnity principle because internal government billing rates were lower, and that it was unreasonably high.

1. The costs order was affirmed. The recoverable costs under the Mount Cook principle were not confined to physically completing the acknowledgement of service and drafting summary grounds. They included the work required to decide whether to contest the judicial review and, if so, to formulate the grounds of defence.

2. Following RC Eastwood deceased, Lloyds Bank v Eastwood [1975] Ch 112, the costs of a successful party represented by an employed solicitor are assessed as if the solicitor were in private practice. The indemnity principle prevents profit, but there is a sensible presumption that this ordinary method of assessment will indemnify rather than overcompensate the party. A detailed calculation is required only where it is reasonably plain that the principle would otherwise be infringed.

3. Applying Town Investments Ltd & others v Department of the Environment [1978] AC 359, the nominal Secretary of State and the Government Legal Department were parts of the government, or Crown, for this purpose. Internal payments and accounting charges between them were therefore irrelevant to the costs incurred by the litigant. They could not show that recovery at £200 per hour would exceed the government’s legal costs.

4. It would be unrealistically expensive, and perhaps impossible, to attribute precisely the government’s total costs to preparing the acknowledgement of service. The evidence did not make a breach of the indemnity principle reasonably plain. The rate was also below the relevant central London guideline rates and was not unreasonably high on summary assessment.

• Upper Tribunal (Immigration and Asylum Chamber): Judge Storey refused permission to apply for judicial review and ordered the applicant to pay the respondent’s acknowledgement-of-service costs, subject to a written objection. This decision determined that objection and affirmed the costs order.