Hunt v North Somerset Council [2015] UKSC 51

Mr Hunt challenged North Somerset Council's youth services budget cuts. The Court of Appeal found the Council had breached its equality and consultation duties but refused relief and ordered Hunt to pay half the costs. The Supreme Court reversed the costs order.

Facts

The appellant, Mr Hunt, born in 1991, suffered from ADHD and other difficulties, making him a ‘qualifying young person’ under section 507B of the Education Act 1996 and a person with a protected characteristic under section 149 of the Equality Act 2010. On 21 February 2012, North Somerset Council approved a Revenue Budget for 2012/13 which included a reduction in youth services spending of £364,793. The appellant was concerned about the impact on services for young people with disabilities, including a weekly youth club he attended.

He brought judicial review proceedings seeking declarations of breach of section 149 of the 2010 Act and section 507B of the 1996 Act, together with a quashing order. Wyn Williams J dismissed the claim at first instance and ordered the appellant to pay costs (subject to a non-enforcement proviso). The Court of Appeal (Moore-Bick, Rimer and Underhill LJJ) found in the appellant’s favour on the two substantive grounds — failure to provide equality impact assessments to decision-making members and failure to consult young persons — but refused any relief because the relevant financial year had passed, dismissed the appeal, and ordered the appellant to pay half the Council’s costs of the appeal.

Issues

Two issues arose before the Supreme Court regarding the Court of Appeal’s disposal:

• Whether the Court of Appeal should, of its own initiative, have made a declaration reflecting its finding that the Council had acted unlawfully.
• Whether the Court of Appeal’s costs order — treating the Council as the ‘successful party’ and ordering the appellant to pay half its costs — was correct in principle.

Arguments

Appellant

The appellant argued that, having found the Council had breached its statutory duties, the Court of Appeal should have made a declaration to that effect and made a costs order in his favour. He had succeeded on both substantive issues; there were wider lessons for local authorities; the lapse of time was not his fault; and denying him his costs would deter claimants from pursuing legitimate public law challenges.

Respondent

The Council contended that the appellant had not in substance been successful, having obtained no result of practical utility, and that he had known about the practical difficulties of unwinding the budget from evidence served before the original hearing.

Judgment

Lord Toulson (with whom Lady Hale, Lord Wilson, Lord Reed and Lord Hughes agreed) delivered the judgment.

Declaration

The Supreme Court rejected the appellant’s complaint that the Court of Appeal should have made a declaration of its own initiative. Counsel for the appellant had not sought declaratory relief at first instance (despite an express invitation from Wyn Williams J for written submissions on relief), nor in the Court of Appeal, nor when the draft judgment was circulated, nor when the form of order was agreed. The complaint was ‘redolent of hindsight’. The authority of the judgment was no greater or less by making or refusing such a declaration. Lord Toulson nonetheless observed that, generally, where a public body has acted unlawfully but no mandatory, prohibitory or quashing order is appropriate, it will usually be appropriate to make some form of declaratory order, since simply dismissing the claim after a finding of illegality may convey a misleading impression. However, where a party is experienced and legally represented and does not seek declaratory relief, the court is under no obligation to make or suggest it.

Costs

On costs, the Court of Appeal had treated the Council as the ‘successful party’ in principle. Lord Toulson held this was an error. The Council was ‘successful’ only in the limited sense that the findings of unlawfulness came too late to alter the past — not because of any delay by the appellant, but because the Council had resisted the claim successfully until the Court of Appeal’s judgment. On the substantive statutory issues, the Council had lost.

Lord Toulson emphasised the public dimension of judicial review, citing Sedley J in R v Somerset County Council, Ex p Dixon [1998] Env LR 111 that public law concerns ‘public wrongs’, not private rights. Since permission had been granted, the issues had been considered sufficiently significant; the ruling under section 149 contained a lesson of general application for local authorities. He stated that where a claimant given permission succeeds in establishing unlawful conduct after fully contested proceedings, some good reason would have to be shown why he should not recover his reasonable costs. The fact that the finding of illegality came too late to reopen the budget was not a principled reason to make the appellant pay any part of the Council’s costs.

However, the appellant had raised wider issues at first instance than those on which leave to appeal was granted, including a far-reaching challenge to the EIAs, and had unrealistically persisted in seeking a quashing order. These factors warranted limiting his costs recovery.

The Supreme Court allowed the appeal on costs, set aside the orders of the courts below, and substituted an order that the appellant recover two thirds of his costs at first instance and in the Court of Appeal, and provisionally two thirds of his costs in the Supreme Court.

Implications

The decision clarifies the proper approach in public law cases where a court finds illegality but considers coercive relief inappropriate. First, while there is no rule requiring a declaration in such cases, it will usually be appropriate to grant some declaratory relief so as not to leave a misleading impression that the claim simply failed. Nevertheless, where a represented party does not request a declaration, the court is not bound to grant or suggest one.

Second, and more significantly, the judgment establishes that a claimant who, having been granted permission, succeeds on contested substantive issues in a judicial review should normally recover reasonable costs even if no practical relief follows, unless good reason justifies a different order. A respondent should not be treated as the ‘successful party’ merely because the passage of time has rendered substantive relief impossible — particularly where the delay results from the respondent’s own resistance to the claim.

The reasoning is grounded in the public character of judicial review: such proceedings vindicate public wrongs, and adverse costs orders against successful claimants risk deterring legitimate public law challenges. The decision is of particular importance to public interest litigants and to local authorities, the latter being reminded — as Lord Toulson noted in relation to section 149 — that committee members must properly discharge the public sector equality duty when taking budgetary decisions. The case does not lay down an absolute rule: costs may still be limited or refused for reasons such as overreaching arguments or unrealistic claims for relief, as occurred here.

Verdict: Appeal allowed on costs. The Court of Appeal’s costs order was set aside and replaced with an order that the appellant recover two thirds of his costs both at first instance and in the Court of Appeal, with two thirds of his costs in the Supreme Court provisionally awarded. The appellant’s challenge regarding the absence of a declaration was rejected.

Source: Hunt v North Somerset Council [2015] UKSC 51