Unsuccessful claimants may have to pay multiple defendants’ costs

A recent decision of the Supreme Court in CPRE Kent v Secretary of State for Communities and Local Government [2021] UKSC 36 has clarified that unsuccessful challengers of planning decision may have to pay multiple defendants’ costs.

CPRE Kent sought permission for statutory review of the decision of Maidstone Borough Council to adopt its Local Plan following a finding by an inspector that, subject to modifications, the Local Plan was “sound”. The Local Plan included a policy which allocated a large site at Woodcut Farm for mixed employment floor space. Roxhill Developments Limited was the promoter of the proposed development at Woodcut Farm and was an interested party in the review.

The claim form was served on SSCLG (the first Respondent), the Council (the second Respondent) and Roxhill, in which (amongst other things) CPRE requested that its cost liability be capped at £10,000 in accordance with CPR Part 45 (the Aarhus Cap). Lang J refused permission to apply for statutory review but accepted that the claim was subject to the Aarhus Cap. On 31 January 2018 Lang J ordered CPRE to pay the costs of SSCLG, the Council and Roxhill in preparing and filing their acknowledgments of service (AoS) and summary grounds of defence which reached the full limit of the Aarhus Cap.

CPRE objected to the award of more than one set of costs, and to the quantum of costs ordered, arguing that it was wrong in principle for costs at the permission stage to absorb the entirety of the Aarhus Cap. HHJ Evans-Gordon affirmed Lang J’s award of costs in April 2018. CPRE sought permission to appeal to the Court of Appeal which was granted in July 2019.

Coulson LJ in the Court of Appeal rejected CPRE’s submissions concluding that there is no general rule in planning cases which limits the number of parties who can recover their reasonable and proportionate costs of preparing those documents, if the application is refused at permission stage.  Coulson LJ helpfully summarised the costs principles which apply to both judicial review and statutory review cases as follows:

a)    When permission to seek review is refused, a claimant may be liable to pay more than one defendant and/or interested party for their costs of preparing and filing their AoS and summary grounds.

b)    It is not necessary for the additional defendant(s) and/or interested party to show "exceptional" or "special" circumstances in order, in principle, to recover those costs.

c)    However, to be recoverable, those costs must be reasonable and proportionate. So, for example, if there is an obvious lead defendant and the court was not assisted by the AoS or summary grounds of an additional defendant(s) and/or interested party, then the costs of that additional defendant(s) and/or interested party may not be proportionate and so will not be recoverable. That is an assessment which is case-specific and not susceptible to more general rules.

On appeal, the Supreme Court found that the Court of Appeal’s ruling revealed no error of law. In reaching a conclusion, Lord Hodge set out previous case law supporting the view that an unsuccessful claimant should bear the reasonable and proportionate costs incurred by defendants and interested parties in preparing and filing their AoS and summary grounds of resistance given that they are obligated to do so under the CPR if they wish to participate in the proceedings.

The Supreme Court’s ruling will likely encourage those considering applying for review of a planning decision to think twice before taking action in view of the risk of substantial costs even if the claim is refused at the first stage.