Judicial review reforms will discourage "ill-conceived and vexatious claims", experts say

Out-Law News | 07 Feb 2014 | 3:10 pm | 3 min. read

Changes to the rules governing judicial review (JR) claims will ensure that those challenging the decisions of public bodies face a "fair level of financial risk", the Government has said.

It is taking forward a number of reforms designed to ensure that only cases with a 'clear public interest' are funded by the taxpayer, as part of the Criminal Justice and Courts Bill, which is currently before Parliament. The changes include limiting the use of Protective Costs Orders (PCOs) in JR claims, making applicants who take weak cases to a second chance hearing pay some of the other side's legal bills, and requiring the name of any party financially backing a JR to be disclosed even if that party is not named in the application.

The proposed changes follow a number of JR reforms introduced last year, including stricter time limits for applying for a JR of a planning or procurement decision and ending second chance hearings in cases ruled 'totally without merit' by a judge. Following a consultation exercise, the Government has decided not to take forward changes to the test for 'standing', governing who is entitled to challenge a particular decision.

Judicial review expert Julian Sladdin of Pinsent Masons, the law firm behind Out-Law.com, said that the proposed changes would be welcomed by public bodies.

"For far too long, public sector bodies and their stakeholders have been the target of ill-conceived and sometimes vexatious JR challenges and have had to pick up the costs of defending themselves due to the previous imbalance in the rules regarding cost recovery," he said.

"While there remains a need for the court to continue to review the lawfulness of public sector decision-making within a fair and democratic society, it is good to see that there is now an acceptance that applicants - and their lawyers - should be placed at risk if they pursue actions which should never have been brought; bringing matters more in line with other fields of civil litigation," he said.

Judicial review 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 first obtain permission from the court before their case can be heard fully.

The Government's recent drive to reform JR coincides with a huge growth in the number of applications; despite the fact that only a small proportion succeed. According to figures from the Ministry of Justice (MoJ), applications more than doubled from 4,300 in 2000 to 12,600 in 2012. Yet at the same time only 440 of those cases went on to a final hearing without being refused permission, withdrawn or settled in 2011 and only 170 of those went in favour of the Government. JR cases also often take over one year to resolve.

If passed in its current form, the Criminal Justice and Courts Bill would limit the use of PCOs for JRs to those cases deemed "exceptional" and "with a clear public interest". Third parties that join a JR case as 'interveners', such as campaigning groups that become involved in a case already taking place between an individual and a public body, would be made responsible for paying their own way and could also be made to compensate the other parties if they cause their legal bills to increase. Details of those financially backing a JR would have to be disclosed, even if they are not a named party, in order to ensure that costs are allocated fairly.

The Government has also proposed requiring applicants who take weak cases to a 'second chance' oral renewal hearing to pay some of the other side's increased legal bills, and targeting legal aid funding more effectively at those cases with merit. To speed up appeals in important cases, more claims would also be able to bypass the Court of Appeal and be heard by the Supreme Court. These proposals will be taken forward later this year through secondary legislation and changes to court rules, along with the setting up of a new dedicated Planning Court within the High Court.

Planning litigation expert Mike Pocock of Pinsent Masons said that the shift in which party bears the financial risk of bringing a claim would have "widespread implications" for those looking to make a planning claim against development projects.

"The Government has also looked at the question of procedural defects and whether the current threshold is too high," he said. "It has concluded that judicial reviews based on failures highly unlikely to have made a difference are not a good use of court time and money. This should help reduce claims which are solely based on technical arguments, even if the planning merits of development schemes are unquestionable."

"In its response to the consultation, the Government has also concluded that the status quo should remain in respect of the ability of local authorities to challenge Nationally Significant Infrastructure Projects (NSIPs) under the 2008 Planning Act. It was thought that to change the position would upset the balance, and it was also noted that no challenge has yet been brought against an NSIP by a local authority. In any event, the new Planning Court should assist in streamlining any judicial reviews," he said.