Good Law Project & Anor v Secretary of State for Health and Social Care

A costs capping order in judicial review proceedings requires a two-stage assessment. The court must first decide whether the statutory threshold is met, including whether the proceedings are public interest proceedings and whether the claimant would reasonably withdraw without protection. If so, the court must decide whether to exercise its discretion, having regard to the parties’ resources, likely benefits, funding arrangements, representation of the public interest and the prospective costs. Public importance may arise from substantial public expenditure and an unresolved point of law, even where the claimant obtains no direct benefit and other investigations are under way. The court may impose reciprocal caps at the same level where the litigation is complex and costly.

The claimants, a not-for-profit organisation and a limited company, challenged the award of nine contracts for personal protective equipment. The challenges concerned direct awards without competition, transparency and equal treatment, reasons, irrationality, financial and technical verification, and the use of a high-priority lane.

The claimants applied for a costs capping order under sections 88 and 89 of the Criminal Justice and Courts Act 2015. The defendant and interested parties opposed the application. The central questions were whether the proceedings were public interest proceedings, whether the claimants would reasonably withdraw without a cap, and whether a cap should be imposed and, if so, at what level.

1. Threshold. The court held that the statutory threshold was satisfied. The proceedings were public interest proceedings because they concerned hundreds of millions of pounds of public expenditure, raised an unresolved question concerning transparency and equal treatment under regulation 32(2)(c) of the Public Contracts Regulations 2015, and involved a point of law of general public importance.
2. The proceedings were an appropriate means of resolving the legality of the procurement procedures. Parliamentary and other investigations did not remove the courts’ proper role in determining legal compliance. The statutory considerations concerning persons directly affected did not prevent a finding of public interest: future suppliers, taxpayers and citizens could have an indirect or wider interest.
3. The claimants established that they would withdraw without an order and that withdrawal would be reasonable. The absence of a realistic economic operator to bring the challenge was material, particularly because the emergency procedure involved no advertised competition and therefore no disappointed bidders. A declaration could provide useful relief even where the contracts had largely been performed and no quashing order or declaration of ineffectiveness was sought.
4. Discretion. The court exercised its discretion under section 89. It considered the significance and complexity of the claims, the substantial costs and disclosure burden, the claimants’ limited resources and crowdfunding, the absence of personal benefit to the claimants or funders, the defendant’s public funding pressures, the reduced legal rates, and the claimants’ suitability to represent the public interest.
5. Terms and interested parties. A reciprocal cap of £250,000 was imposed in respect of both claimants and the defendant. Different caps were inappropriate given the substantial and broadly shared costs. No order was made in relation to the interested parties, whose involvement was limited and who would not be directly affected by relief.