UK found wanting in European Court of Justice
The UK has been found to be in breach of its obligation to protect the public from excessive costs in environmental cases.
In a landmark case, European Commission v UK Case C-530/11, the European Court of Justice (ECJ) held that merely giving judges discretion to cap costs does not provide sufficient certainty to comply with the Aarhus Convention. Under Aarhus, which was ratified by the European Union in 2005, member states must ensure that the cost of bringing proceedings in environmental cases is not prohibitively expensive.
Michael Bedford, barrister at Cornerstone barristers, says: “The European Court has rejected the UK government’s arguments that the previous PCO [protective costs orders] system was Aarhus compliant in relation to ensuring that environmental litigation was not prohibitively expensive.
“However, the European Court did not consider the effect of the changes introduced by CPR 45 Part VII and its associated Practice Direction and so it is unclear whether the European Court would consider these changes are sufficient to resolve the problem.” Under these changes, as of April 2013, individuals in environmental cases only have to pay up to £5,000 (and NGOs up to £10,000) of the defendant’s costs, and can only claim back £35,000."
Bedford continues: “The new CPR 45 cost limits would appear to meet the requirement for certainty and precision. However, the European Court also found that to be Aarhus compliant the costs ‘must neither exceed the financial resources of the person concerned not appear in any event to be objectively unreasonable’. The former condition is not necessarily met by a fixed liability of £5,000 because even this sum may be beyond the means of some litigants. Also, the European Court held that the right of a defendant in environmental proceedings to seek a cross-undertaking in damages for the grant of any interim relief (such as an injunction restraining building works pending a challenge to the planning permission) was also subject to the requirement that any such imposition should not be prohibitively expensive.
“Thus, it would seem further reform of the CPR will be needed and in the interim practitioners will face uncertainty as to whether cross-undertakings will be required."
