The Royal Society for the Protection of Birds Friends of the Earth Ltd & Anor v Secretary of State for Justice the Lord Chancellor

Costs rules for environmental claims must provide effective access to justice and reasonable predictability as to both liability for costs and their amount. Default costs caps may be varied where the claimant has provided false or misleading financial information, or where there has been a material change in financial resources. They cannot be varied merely on the same information supplied at the outset.

Hearings concerning variation of costs caps should initially be held in private where confidential financial information about claimants or third-party supporters may be examined. A claimant’s own reasonable costs may be included when assessing whether proceedings are prohibitively expensive.

The claimants, environmental organisations, challenged amendments to Part 45 Section VII of the Civil Procedure Rules 1998. The amendments replaced the earlier Aarhus costs regime with default costs caps, a power to vary those caps, and requirements to disclose financial resources and third-party support.

The challenge concerned whether the new regime complied with the Aarhus Convention and relevant EU environmental law. The three grounds concerned variation of costs caps, privacy at hearings involving financial information, and inclusion of the claimant’s own costs in assessing whether proceedings were prohibitively expensive.

1. Ground 1 dismissed. The power in CPR 45.44 to vary default costs caps was compatible with the requirement that environmental proceedings must not be prohibitively expensive. The relevant question was whether the regime, considered with the surrounding procedural rules and court practice, provided reasonable predictability.
2. Applications based on the claimant’s financial information should ordinarily be made with the acknowledgment of service and resolved at the earliest stage, normally when permission was considered. A later application should not be permitted merely because the defendant had failed to raise the issue earlier.
3. Later variation could properly be considered where the claimant had supplied false or misleading information, or where there had been a material change in the claimant’s financial resources. A regime allowing variation on the same information provided at the outset would not provide reasonable predictability.
4. Ground 2 succeeded in substance. A hearing concerning variation of costs caps involves confidential financial information. The first such hearing should therefore be listed in private. The protection applied equally to individual claimants, organisations and third-party supporters. The proposed changes limited to private individual claimants were inadequate.
5. Ground 3 accepted in principle, but no declaration granted. The court could take account of the claimant’s own reasonable costs when deciding whether proceedings were prohibitively expensive, since the assessment concerned all costs arising from participation in the proceedings. The parties’ consensus made declaratory relief unnecessary.
6. The claimants’ concerns about the chilling effect of public disclosure were legitimate. The rules also required clearer definition of the financial information to be provided, although that issue was not finally determined as a separate ground.

First-instance judicial review in the High Court (Administrative Court). The judgment formulated conclusions on the grounds and invited further submissions on appropriate relief.