High Court: Environmental activists not liable to pay costs for unsuccessful applications for special cost orders

About this case:

• Citation:
  [2022] IEHC 96
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Garrett Simons

The ruling came after An Taisce brought proceedings against the State seeking to clarify that it was not required to pay for unsuccessful applications for protective costs orders in challenges to aquaculture licenses.

Delivering judgment in the case, Mr Justice Garrett Simons granted a declaration that section 7 of the Environment (Miscellaneous Provisions) Act 2011 did not envisage that a costs order would be made against an unsuccessful applicant. Instead, the ordinary rule was that both sides would bear their own costs, the court said.

Background

An Taisce sought to challenge a large number of aquaculture licences which authorised the cultivation of mussels in Wexford harbour. The Minister for Agriculture, Food and the Marine had granted thirty-six licences, which An Taisce attempted to appeal by way of a single, omnibus appeal.

The Aquaculture Licence Appeals Board rejected the form of the appeal and An Taisce intended to challenge the decision by way of judicial review. However, the proceedings were not formally issued because An Taisce sought to determine whether the proceedings would attract the special costs regime for environmental litigation.

The Planning and Development Act 2000 and the Environment (Miscellaneous Provisions) Act 2011 provided that applicants in environmental litigation could not have costs orders made against them. Further, section 7 of the 2011 Act provided for a statutory mechanism which could allow for a “costs protection determination” to be made at any stage in proceedings.

An Taisce did not bring an application under section 7 because it feared that, if it were unsuccessful in the application, it would be liable for the costs of the failed application. Since there would be thirteen holders of impugned licences that would be joined as notice parties, it was anticipated that a “loss” in the application for special costs would result in a costs liability of €300,000 plus VAT. It was stated that this would effectively bankrupt An Taisce, which is a charitable body.

As such, An Taisce instituted proceedings against the Minister and the Attorney General by way of originating notice of motion. Essentially, the applicant sought a direction that the State must indemnify An Taisce for any costs ordered against it for an unsuccessful costs-protection determination.

Ultimately, when the matter came on for hearing, the State parties agreed with An Taisce’s interpretation of section 7 of the 2011 Act. As such, it was accepted that an unsuccessful applicant under section 7 could not be liable for costs.

High Court

Giving judgment in the matter, Mr Justice Simons noted that the Attorney General acted as a legitimus contradictor before the court. If there was a plausible alternative interpretation of section 7, then the State parties could have articulated same, the court said.

However, it was held that the correct interpretation of legislation was “not the sole preserve of the parties to any particular set of proceedings” and that it was a matter for the court to rule on the issue (Callaghan v. An Bord Pleanála [2017] IESC 60).

Considering section 7 of the 2011 Act, the court noted that the section itself was silent on the allocation of costs. As such, the court considered the legislative intent of the section. It was held that, implicitly, the Oireachtas recognised the importance for parties having certainty on the issue of legal costs and that the courts may need to make decisions on whether the special costs regime applied in individual cases. It was stated that the legislative intent would be defeated if the moving party for a protective costs determination was at risk of having costs awarded against them if they were unsuccessful.

The court considered the opinion of the Advocate General in Case C-470/16, North East Pylon Pressure Campaign, EU:C:2017:781, where it was stated that a fundamental objective of the EIA Directive would be undermined if an applicant only knew whether they faced an adverse costs order after the case was instituted. Clear and unambiguous rules needed to be set out by Member States regarding the appropriate stage for a “not prohibitively expensive” costs application. Mr Justice Simons held that the same logic applied to a protective costs determination.

The court noted that the domestic legislative provisions which govern the availability of costs protection orders were complex. In Heather Hill Management Company v. An Bord Pleanála [2021] IECA 259, it was held that an applicant must assess each individual ground of challenge as to whether cost protection was available. As such, it was held that the Court of Appeal had drawn a distinction between various grounds of challenge in environmental litigation.

The court said: “The assignment of each ground in any particular set of proceedings to the correct pigeonhole is not a straightforward task, and has already resulted in a slew of interlocutory applications in respect of costs protection in other judicial review proceedings.”

It was held that the statutory mechanism under section 7 was an essential safeguard in light of the uncertainty in the case law generally. As such, the court was satisfied that the correct interpretation of section 7 did not envisage that a costs order would be made against an unsuccessful application under section 7. The ordinary rule would be that each party bears its own costs, unless exceptional circumstances such as acting in bad faith was proven.

The court also noted that other courts were satisfied that costs protection must be available in the context of an application for a costs-protection determination (Enniskerry Alliance v. An Bord Pleanála [2022] IEHC 6.

Conclusion

The court stated that, in practice, an applicant contending for the special costs regime should write to the other parties prior to issuing a section 7 application. This may render an application unnecessary if all parties could agree, the court said.

Having regard to the court’s interpretation of the legislation, it was not necessary to make an order requiring the State to indemnify An Taisce. It was held that any of the applicant’s concerns could be addressed in a section 7 application. The court made a declaration on the effect of section 7 and struck out the proceedings.