Case Summary: R (on the application of Cornerhouse Research) –v- the Secretary of State for Trade and Industry [2005] EWCA Civ 192

case-law-677940

England and Wales

The Court of Appeal set out the criteria for granting Protective Costs Orders as being that: the issues are of general public importance; the public interest requires that the issues be resolved; the applicant has no private interest in the case; having regard to the parties’ resources it is fair and just to make the order; and if the order is not made, the Applicant will probably discontinue proceedings. Pro bono representation would enhance an application for a Protective Costs Order (PCO).

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Background

The Export Credit Guarantee Department helps to provide finance or security to UK exporters in the field of international trade. In 2000 it issued a new procedural code. Cornerhouse Research is a non-profit company with expertise in bribery and corruption in international trade. They sought to judicially review the consultation process in relation to the ECGD’s new procedural code as being in breach of public law principles and of the ECGD’s own guidance. In their view the new procedural code weakened protection against bribery and corruption.

Finding

The Court of Appeal ordered a PCO to the effect that the Defendant could not recover their costs and costs recoverable by the Claimant were capped.

Reasoning

The case raised issues of general public importance. It related to the way in which British companies conducted business abroad and involved the taxpayers’ interests and a state department. It was in the public interest to resolve the matter. Cornerhouse Research had no private interest. The matter had real prospects of success.

Points of note

This case is significant, as the Court of Appeal took the opportunity to review case-law on PCOs to date and to set out the relevant criteria for granting a PCO. These criteria have been applied and discussed in subsequent English case-law and referred to in Irish case-law.

The Court set out the relevant criteria as being:

The issues raised are of general public importance;

  • The public interest requires that the issues be resolved
  • The applicant has no private interest in the case
  • Having regard to the parties’ financial resources and likely costs it is fair and just to make the PCO
  • If the PCO is not made the Applicant will probably discontinue proceedings.

They added that pro bono representation would probably enhance the merits of an application (it is worth noting that there was no pro bono representation in this matter). They reiterated that the matter fell within the court’s discretion.

Notably, they chose to exclude Dyson J’s prerequisite in R (on the application of CPAG) –v- Lord Chancellor’s Department [1998] EWHC Admin 151 that the Court should have sufficient appreciation of the merits of the claim, reasoning that to place the threshold that high would invite expensive satellite litigation. It sufficed for the Court to require the matter to have a real (not fanciful) prospect of success or to be “properly arguable”.

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