The latest on costs in the Administrative Court

The recent case of R (ota Baxter) v Lincolnshire County Council (2015), a judicial review challenge to a community care assessment and placement decision, raises once again the issue of how costs should be determined in the Administrative Court when the parties have settled the case but left liability for costs to be determined by a single judge on the basis of written submissions.

At first instance, a Deputy High Court Judge had decided to make no order for costs, on the grounds that, although the claim had been withdrawn, the underlying issues remained contested, it was not clear that the Appellant had obtained the relief sought and it could not be said with certainty how the case might have turned out had the matter been pursued.

In reaching its decision, the Court of Appeal took the opportunity to recap current guidance and case law:

In December 2013 the Administrative Court issued guidance as to how the parties should assist the court when applications for costs are made following settlement of judicial review claims. The key points from the guidance, arising out of the ruling in M v London Borough of Croydon (2012) (M), are:

• The onus lies on the parties to reach agreement on costs wherever possible, before asking the Court to intervene.
• Liability for costs will depend on the specific facts of each case but the basic principles are set out in M at paragraphs 59 to 63 ie:
  • Case (i): A wholly successful Claimant will generally recover his costs.
  • Case (ii): A partly successful Claimant should prompt the Court to consider factors such as how reasonable pursuit of the unsuccessful claim was, how important the unsuccessful claim was by comparison with the successful claim, and how much costs were increased by pursuit of the unsuccessful claim. No order for costs may be the appropriate outcome.
  • Case (iii): Where some compromise is achieved which does not actually reflect the claims made, the Court should endeavour to gauge whether either party could be said to have been successful. If the Court cannot do so, the default position may well be no order for costs.
• Parties wishing to claim or resist a claim for costs must follow the timetable set out in the guidance for making submissions. Submissions should be succinct, comply with the content guidance, clearly identify the extent to which the parties complied with the pre-action protocol, set out how the case aligns with the principles in M and append the pre action and relevant costs and settlement correspondence.

The Court of Appeal endorsed the decision of the Deputy High Court Judge with the following observations:

• Where parties decide to leave the matter of costs to be determined by a Court which has not had the advantage of considering the substantive issues in the case, they will be taken to have accepted that the Court’s approach will necessarily be a summary and proportionate assessment.
• It will often be helpful for the Court to begin with the claim form and the consent order and then consider whether there has been compliance with the pre-action protocol and whether the claim was either unnecessary or premature.
• Approaching the particular facts of the case in that way, it was apparent that the Appellant had failed to comply with the pre-action protocol and the claim was, accordingly, premature; the Respondent had neither agreed to quash its assessment nor to produce a care plan, core elements of the relief sought. On that basis, the Appellant could not be said to have established that he should be treated as the successful party. The Deputy High Court Judge’s conclusion was well within the ambit of her discretion and should not be disturbed.

The Court was clear that parties should tie up precious judicial time only as a last resort when reasoned costs negotiations have failed. Litigants should behave proportionately and sensibly and failure to comply with the pre-action protocol, leading to settlement at the more costly post-issue stage rather than pre-issue, will not be viewed favourably in the absence of very unusual circumstances.

If you would like our support when the pre-action letter crosses your desk, or you need assistance in negotiating or recovering costs, please contact Jane Williams or Jill Mason.