Rashid v London Borough of Merton

In settled judicial review proceedings, the costs order depends on what the litigation achieved as it unfolded, not solely on the formal relief claimed, adjudicated or conceded. The court may identify the effective or substantially successful party by examining material developments and the principal issue between the parties. Interim relief can amount to success where it secured the practical outcome that became the central issue, even though a wider claim became academic and no final order was made. A failure to consider those matters is an error of principle in exercising the costs discretion. On appeal, the costs order may be set aside and the discretion re-exercised. The assessment remains fact-sensitive; an interim order will not invariably constitute success.

The Appellant, who had special educational needs, brought judicial review proceedings concerning funding for an educational placement abroad. The Administrative Court made interim orders requiring the Respondent to contribute to the placement costs. The proceedings were later settled and withdrawn after a suitable United Kingdom placement became available, with costs left for determination on the papers. The judge ordered no order as to costs. The appeal concerned whether the Appellant was the effective successful party, despite the unresolved claim for long-term funding and the absence of a final determination or formal concession.

1. Disposition. The appeal was allowed in substance. The Administrative Court’s no-order-as-to-costs decision was set aside, and the Court of Appeal exercised the discretion in favour of the Appellant as the substantially successful party. The transcript contains an apparent inconsistency because paragraph 23 records that the appeal should be dismissed, although the preceding reasoning and proposed order require the opposite result.
2. Applicable approach. The court applied the principles identified in M v Croydon LBC. In cases involving partial success or a compromise which does not reflect the claim, the costs order depends on the particular facts. The court may determine who was the effective successful party.
3. Interim relief and success. Success is not confined to success on the final claim or to a concession. Although an interim order will not invariably constitute success, the question is fact-specific. Here, the litigation evolved so that the principal issue became interim funding until a United Kingdom placement was available. The Appellant obtained that practical outcome through interim relief. The Respondent did not pursue discharge or expedition of the interim order and effectively acquiesced in its continuation.
4. Error of principle. The judge failed to consider whether the material developments established an effective winner. That failure was an error of principle justifying appellate intervention in a costs discretion. The case was distinguished from Dempsey, where the claimant had obtained an assessment by interim order; this case concerned interim funding. The unresolved long-term funding issue and the failure to recover earlier payments did not outweigh the Appellant’s substantial success.

• High Court of Justice, Queen’s Bench Division, Administrative Court: Following settlement and withdrawal of the judicial review claim, His Honour Judge Bidder QC ordered no order as to costs.
• Court of Appeal (Civil Division): The court held that the judge had made an error of principle, set aside the costs decision and exercised the discretion in favour of the Appellant.