Automatic legal cost caps

against environmental related challenges scrapped

The Issue


Changes to the Protective Cost Order (PCO) regime came into force on 28 February 2017, and will directly impact how individuals and non-government organisations can bring environmental legal challenges against development projects.

The PCO regime in the UK was introduced in 2013, in part due to the international Aarhus Convention, and it capped costs to £5,000 for individuals and £10,000 for organisations in all environmental-related legal challenges.

Although the Government’s plans, introduced through ‘The Civil Procedure (Amendment) Rules 2017, retain existing limits, an individual or organisation wanting to bring a judicial review in environmental cases will now no longer automatically receive this cost cap protection. Instead the courts will have the power to either amend or remove the caps altogether -  subject to means testing of the claimant.

Transitional arrangements are now in place for cases already going through the courts, but any new claims will fall under this new regime.

 

Bidwells View

 

The introduction of PCOs has always provided cost certainty and protection to third parties pursuing litigation against development projects. This has in the past fuelled many environmental (EIA) related challenges from local community groups, individual residents and organisations.

Whilst the ability to now remove/amend these cost limits could provide some deterrent to persistent litigants, the reality is still likely to be ‘Business as Usual’ for the foreseeable future. The changing rules potentially still offer the opportunity for local residents/community groups to exploit ‘loop-holes’ if they can demonstrate they have insufficient financial resources and therefore require cost caps to remain in place.

Going forward, we will need to wait to see how the courts interpret the new rules. This will be particularly interesting where a development scheme is consented on the basis of environmental information, such as an EIA, which concludes that the project will not have significant environmental effects, but a challenge is then pursued on the basis of the way the decision was made. Time will tell if the courts take a different view on whether such a challenge will be cost protected?

With the possibility of a hard Brexit on the horizon, and the future application of EU and International derived legislation in the UK uncertain, the case law that follows will be pivotal to how much of an impact these changes will have on future development projects. However, for now, our view is that it’s business as usual.

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