Reform of judicial review receives royal assent: environmental cases carved-out from restrictions on cost capping

JR is a process through which individuals, businesses and other affected parties can challenge the lawfulness of decisions or actions of public bodies and those exercising public functions. Only those with 'sufficient interest' in a decision can challenge it, and they must obtain permission from the court before their case can be heard in full.

The Act provides that the High Court must refuse to grant an application for JR if it appears to the court to be "highly likely that the outcome for the applicant would not have been substantially different if the conduct complained of had not occurred" save where the court considers that it is appropriate to do so for reasons of "exceptional public interest". 

Eluned Watson of Pinsent Masons, the law firm behind Out-Law.com, said that "the precise scope of the term “exceptional public interest” has been the subject of extensive debate in the House of Lords as it is not defined and has no statutory precedent.  As such the term is open to wide interpretation - the word “exceptional” could mean different things in different contexts. Going forward, the interpretation of this term by the courts will have a considerable impact on the future of JR challenges”. 

The Act also restricts the ability of judges in England and Wales to make CCOs in JR cases to those where permission to proceed has already been granted and that meet a public interest test, amongst other conditions.

However, the Act provides that “….the Lord Chancellor may by regulations provide that the cost capping provisions of the Act do not apply in relation to JR proceedings which, in the Lord Chancellor’s opinion, have as their subject an issue relating entirely or partly to the environment”. 

The carve out for environmental cases from the restrictions on CCOs is required in order to comply with the Aarhus Convention requirements on access to environmental justice. The Aarhus Convention requires public bodies to ensure that members of the public have access to a procedure to challenge decisions relating to the environment to the extent permitted by national law. This procedure must be "fair, equitable, timely and not prohibitively expensive".

Non-environmental planning cases will be subject to the full financial implications of the CCO restrictions in the Act.

Watson said "there has been much debate on whether the Act's carve-out of environmental cases from the restrictions on CCOs goes far enough.  The Lord Chancellor is granted a substantial degree of discretion" she said. "The UK has already faced visits to the European Court for failing to fully implement the Aarhus Convention and, if on implementing the Act, it interprets environmental cases narrowly, it may well see further visits to the European Court."

As well as limiting the use of CCOs, the Act will also make third party 'interveners' (such as charities and campaigning groups) liable for their own costs and introduces new financial disclosure requirements.  The details of those financially backing a JR will need to be disclosed (even if they are not a named party to the proceedings) in order to ensure that costs are fairly allocated.

Watson said that "it seems likely that fewer charities and NGOs will come forward to take part in JR proceedings brought against a public body by a member of the public, since the new rules make it less likely that they would be able to recover their costs".

"This, together with reduced access to CCOs, means that going forward we are likely to see a reduction in the number of unmerited JR claims," she said. "This has been welcomed by public bodies and developers alike on the basis that, all too often, JR proceedings are pursued as a campaigning tool or to simply delay legitimate proposals".

"Those wishing to challenge the decisions of public bodies on planning and environmental matters will need to be aware of these latest reforms, the remaining uncertainties on the implication of the new provisions and the risks of serious financial implications from increased exposure to the other side's costs" she said.