Companies - application for costs.
[2020]JRC263
Royal Court
(Samedi)
18 December 2020
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Before :
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T. J. Le Cocq, Esq., Bailiff, sitting alone.
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Between
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SWM Limited
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Applicant
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And
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Jersey Financial Services Commission
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Respondent
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Advocate O. A. Blakeley for SWM Limited.
Advocate D. J. Benest for Jersey Financial
Services Commission.
judgment
the bailiff:
1.
This is an
application by SWM Limited ("SWM") for its costs in connection with
proceedings between it and the Jersey Financial Services Commission ("the
Commission"). Both SWM and
the Commission agreed that the proceedings should come to an end and the
proceedings are in effect being discontinued by consent. The only outstanding issue is the
question of costs. SWM seeks its
costs of the proceedings, the Commission disagrees.
Background
2.
On 9th
July, 2018, the Commission issued sanctions against SWM (the
"Decision").
3.
On 7th
August, 2018, the Commission determined to revoke SWM's registration as
an investment business and to issue a public statement to that effect.
4.
SWM
appealed against the revocation to this Court. The appeal was heard over three days in
January 2019 and Judgment was handed down on 4th June, 2019. The Royal Court quashed the revocation
and remitted the matter of sanction back to the Board of the Commission saying:
".... The decision on
matters such as the appropriate sanction is primarily a matter for the
Commission as regulator of the financial services industry. Accordingly, we remit the matter of
sanction to the Board to reconsider in the light of the findings contained in
this judgment and any material which may be put before the Board at that
stage."
5.
The effect
of the Royal Court's judgment was to return the Commission's
consideration to Stage 3 of the Decision-Making Process (DMP). This requires the Commission Executive
to provide a memorandum to the Board.
6.
In advance
of the Stage 3 meeting, the Executive provided the Board with two memoranda:
(i)
A
memorandum dated 16th October, 2019 (the "16 October
Memo"). This concluded that
the Board could have regard to all material previously before it, however, the
Board could not reach a view on that material which was inconsistent with the
Royal Court Judgment. The
memorandum concluded that the Board was also able to take into account any new
and additional material to the extent that such was relevant to the
Board's decision.
(ii) A memorandum dated 29th October,
2019 (the "29 October Memo"), which sets out the options available to
the Board in the reconsideration of sanction. The Executive's recommended course
of action was to issue a public statement.
7.
Both the
16 October Memo and 29 October Memo were provided to SWM and SWM
responded to 29 October Memo on 28th November, 2019.
8.
The
Commission, in preparing to reconsider sanction put in train another DMP. The materials prepared during that DMP
stated the Commission was entitled to re-visit the issue of mis-selling. SWM disagreed.
9.
The Stage
3 Meeting was fixed for 12th December, 2019. In advance, SWM applied, ex parte,
for leave to bring Judicial Review Proceedings. I granted leave on 4th
December, 2019 ("the JR Leave"). The JR Leave contained an injunction
prohibiting the Commission from considering issues concerning mis-selling.
10. The Commission applied to set aside the JR
Leave on 18th December, 2019.
11. Before any further progress in the Judicial
Review proceedings the Commission notified SWM that it was going to continue
with DMP but would not consider any matter prohibited by the injunction granted
as part of the JR Leave. It also
confirmed, once the DMP was concluded, that it would to seek to reopen the
question of mis-selling if, after the Judicial Review, the court ruled that it
could.
12. Ultimately, the Commission proceeded with the
DMP on the of 17th February, 2020. In advance of the Stage 3 Meeting a
further memorandum was prepared, provided to SWM and SWM commented on it.
13. A Final Meeting was held on 15th May,
2020. The Board determined to issue
a public statement in respect of SWM.
SWM was notified of this decision by letter dated 28th May,
2020, and has not appealed against that decision.
14. As a result of the stance taken by the
Commission, it was agreed between the parties that proceeding with the Judicial
Review was very likely to be unnecessary.
The issue that remained was what orders, if any, should the court make
in respect of the parties' legal costs.
SWM's Case in brief
15. SWM's arguments in brief, may be simply
stated:
(a) Absent specific legislative provisions, cost
orders are a matter for the court's discretion. In exercising its discretion, the court
should aim to achieve the overriding objective: to do justice between the
parties.
(b) SWM would likely have prevailed in the Judicial
Review application.
(c) SWM's claim for costs is also supported
by five points:
·
Costs are
at the absolute discretion of the court;
·
The
overriding objective of the court in costs orders is to do justice between the
parties;
·
SWM
behaved properly in seeking the court's protection against the Commission
from an abuse of process;
·
The
Commission's affidavit filed in the JR is enough to show SWM was correct
in its abuse of process argument;
·
The court
should not allow SWM to suffer financial prejudice caused by the
Commission's abuse of process.
Law
Costs
16. Rule 6/31(1) of the Royal Court Rules 2004 (as
amended) provides that:
"Except with the consent of
the other parties to the action, a party may not discontinue an action or
counterclaim .... without the leave of the Court, and any such leave may be
given on such terms as to costs .... as the justice of the case may
require."
17. Article 2 of Part 1 of the Civil Proceedings (Jersey) Law 1956 provides:
"Subject to the provisions of
this Part and to rules of the court made under the Royal Court (Jersey) Law
1948, the costs of and incidental to all proceedings in the Royal Court shall
be in the discretion of the Court, and the Court shall have full power to
determine by whom and to what extent the costs are to be paid."
18. Judicial Review proceedings are civil
proceedings and fall within the ambit of Article 2.
19. When deciding how to achieve justice between
the parties, the court should have regard to all relevant facts and
matters. Although costs very often
will "follow the event" in some cases, to achieve justice,
the court may have to consider other factors such as the parties'
conduct, the history of the dispute and other factors.
20. As to the principles to be applied when
considering an award of costs, the statement set out by Commissioner Page in Watkins
v Egglishaw [2002] JLR1 has been endorsed on numerous occasions by the
Courts. At page 5 et seq.
the Court said:
"7 The principles that should
guide the court in the exercise of its discretion in this area appear to me,
therefore, to be as follows, stating them as shortly and simply as possible:
(a) The Court's overriding objective in
considering costs is, as in everything else, to do justice between the parties.
(b) In many cases, that objective will be fulfilled
by making an award of costs in favour of the "winning" party, where
a "winner" is readily apparent. In any event the "follow the
event" rule can still be a useful starting point.
(c) It is a mistake, however, to strain overmuch to
try to label one party as the "winner" and one as the
"loser" when the complexity or other circumstances of the
litigation do not readily lend themselves to analysis in these terms.
(d) The Court's statutory discretion is a
wide one and ought not to be treated as fettered by any particular supposed
rule or practice, other than that the discretion should be exercised judicially
and broadly in accordance with the guidance principles referred to in Ir re
Egindata (No 2) [1992] 1 WLR 1207 and A E I Rediffusion Music Limited v
Phonographic Performance Limited [1991] 1 WLR 1507.
(e) It is open to the Court to have regard to any
and all considerations that may have any bearing on the overriding objective of
doing justice. Its task is to take
an overview of the case as a whole.
(f)
It is
implicit in this that, even though a party would otherwise be regarded as
having been "successful", justice may require that costs should not
automatically follow the event."
Leave in Judicial Review
21. The Commission argued that the JR Leave should
be set aside and therefore it is relevant to consider the test before
leave. The test for leave in
Judicial Review cases was set out by the Court of Appeal in Welsh v The
Deputy Judicial Greffier [2009] JCA 145C]. The Court referred to the judgment of Lord
Bingham in Sharma v Browne Antoine [2007] 1 WLR 780 in which the Court
said:
"(4) The ordinary rule now is that the court will
refuse leave to claim judicial review unless satisfied that there is an
arguable ground for judicial review having a realistic prospect of success and
not subject to a discretionary bar such as delay or an alternative
remedy........"
22. The Court of Appeal in Welsh commented, at
paragraph 12 of its Judgment that:
"This exegesis, in my view,
elaborates what is meant by "... an arguable case that a ground for
seeking Judicial Review exists which merits a full investigation at a full oral
hearing with all parties and all the relevant evidence" (Yates v Minister
for Planning & Environment [2006] JRC 167), a decision of the Royal
Court."
23. The Court went on to say at paragraph 13:
"In my view what we must
consider is the Decision itself."
24. In essence, the Court should be satisfied that:
(a) there has been a decision made which is capable
of review;
(b) there is an arguable ground for judicial
review; and
(c) there is no discretionary bar or alternative
remedy available.
Decision Capable of Review
25. The question as to what constitutes a decision
capable of review was considered by the Royal Court in Clear Mobitel
(Jersey) Limited v Jersey Competition Regulatory Authority [2011] JRC 181. Sir Michael Birt, Bailiff,
reviewed the cases as to what might constitute a reviewable decision and at
paragraph 34 et seq. said:
"34. The boundaries of matters
which are judicially reviewable have been considered in two cases in Northern
Ireland. In Re Kinnegar
Residents' Action Group Applications [2007] NIQB 90, the applicants
sought to judicially review recommendations contained in a report prepared by a
panel appointed to look into certain planning issues relating to Belfast City
Airport. The court held that the
recommendations of the panel did not have any legal effect or
consequences. They were not binding
on the Department of the Environment as the ultimate decision maker. They were of course a very material
consideration to be taken into account in the ultimate decision but the weight
put upon them would ultimately be a matter for the judgment of the minister,
taking account of all further consultations and other relevant matters. The court held that it would be
inappropriate in an ongoing and incomplete process which had not reached the
stage of a decision for the court to be drawn into the process of analysing
arguments and evidence which were going to be taken into account in the
decision-making process.
35. Similarly in re Kotrayenko No 1
[2008] NIQB 118 the Court held that the description of the applicant in certain
Home Office records as being a person of "nationality unspecified"
was not an act, decision or determination having legal effects of
consequences. The Judge referred to
the passage from Wade and Forsyth, Administrative Law, 9th Edition at p 611:-
"it cannot be too clearly understood that the remedy by way of
certiorari only lies to bring up to this court and quash something which is a
determination or a decision .....
As the law has developed certiorari and prohibition have become
general remedies which may be granted in respect of any decisive exercise of
discretion by an authority having public functions, whether individual or
collective ....
They will lie where there is some preliminary decision, as opposed
to a mere recommendation, which is a prescribed step in a statutory process
which leads to a decision affecting rights, even though the preliminary
decision does not immediately affect rights itself"
The court held that what was in the
Home Office records was not a decision which was subject to judicial review.
36. To
the opposite effect is the decision in R v Agricultural Dewlling-House
Advisory Committee for Bedfordshire, Cambridgeshire and Northamptonshire (1987)
19 HLR 367. In that case the
decision in question fell to be taken to the local authority but, under the
relevant statute, it was entitled if it wished to obtain advice from an
Agricultural Dwelling-House Advisory Committee. The local authority decided to do so and
the applicant contended that the procedure followed by the Advisory Committee
in deciding upon its advice was reached in a procedurally unfair manner. The issue arose as to whether certiorari
would go to quash an advisory decision of this nature when the determination
itself was to be that of another body, namely the local authority. Hodgson J said this at page 374:-
"in my judgment, particularly
when one is considering the procedural impropriety or otherwise by which a
decision of this nature - that is, one which is not finally determined - can be
subject to judicial review, one has to pay great regard to a consideration
which appears in a sentence of de Smith at page 234:
'The degree of proximity
between the investigation in question and an act or decision directly adverse
to the interests of the person claiming entitlement to be heard may be
important.'
I think it is right. Merely because a decision to give
advice, or the advice itself, is not finally determinative of a question is not
in my view the determining factor.
I think it is important to look at all the facts and see in general
terms what part of that sub-decision, if I can coin a phrase, plays in the
making of the decision as a whole.
It is only a decision to give
evidence one way or the other then plainly it would not be subject to judicial
review. But where that advice is
sought by the determining authority from a committee of whose decision the
authority is required by statue to take full account and where there is some
evidence that in practice the
advice is - to put no higher - highly likely to be followed, then I
think it would be working (sic) to allow the proceedings to go further and
require the applicant to wait until the decision of the local authority is made
against him, if it is, before attacking that decision on the basis that the
material upon which it was based was flawed.
That would seem to me to be a
wholly unnecessary requirement, and I have no doubt on the facts of this case
and within the context of this legislation that the court has power to
interfere at this stage, and it is a power which it ought to exercise if it is
satisfied that there has been a procedural impropriety. I am satisfied that there has been that
procedural impropriety. I think
that in my discretion I ought not to refuse the relief sought at this stage,
and the consequence of that is that this decision of the committee must be
brought up to this court and quashed".
26. After weighing these authorities, the Court
concluded at paragraph 37:
"....... Ultimately there is no formulaic or
straightforward answer to the question of what matters may be the subject of
judicial review and each case must to an extent turn on its own particular
facts. In this case the Court is
satisfied that any recommendation from the JCRA will normally play an extremely
significant part in any financial decision by Ofcom. We also take account of the fact that
any decision of Ofcom is clearly a long way off, so that there will be no
immediate remedy by reference to any decision of Ofcom ..."
"All in all, the Court is persuaded that this is one of these
rare cases where a recommendation is nevertheless subject to judicial
review. A revocation of that
recommendation is therefore similarly subject to judicial review."
Costs relating to Regulators
27. It was also suggested by the Commission the
particular costs considerations apply to those carrying out a public duty. In these case of AG v Rosenlund and
Others [2016] (1) JLR 348) the Royal Court, Clyde-Smith, Commissioner
presiding, considered the argument that different cost considerations apply
when considering the actions of a public authority carrying out a regulatory
function. It was argued before the
Court that ordinarily no order should be made against, in that case, the
Attorney General who was carrying out important public functions unless there
was dishonesty or lack of good faith.
That argument was supported, so it was urged upon the Court by a
decision of the High Court in Baxendale/Walker v the Law Society [2006] EWHC 643 and a case involving the Minister for Health and Social Services in this
jurisdiction.
28. Of those arguments, the court said this at
paragraph 7 of the judgment:
"7. Special considerations have long
applied to the costs regime in family law cases, and indeed all of the cases
cited in Health and Social Servs. Min v A were family law cases. Whilst I can see the analogy between the
position of the Minster for Health and the Attorney General, the question of
costs involving public bodies carrying out a range of public functions has been
carefully analysed by Page, Commr. in Jersey Fin. Servs. Commn. v A.P. Black
(Jersey) Ltd. (4), in which he considered a number of English and Jersey
authorities. Without setting out
his detailed analysis, he reached this conclusion (2007 JLR 1, at para. 35):
In these sparsely-charted waters,
it is therefore with some hesitation that I express the following conclusions,
particularly in circumstances where only one of the parties before me was
legally represented at the hearing itself and the issue is of some importance.
(i)
On any
view, the idea that bodies engaged in performing public-interest functions must
in all cases 'take [their] chance on costs, just like any other litigant
in these courts,' as espoused by the members of the English Court of
Appeal in Southbourne ([1993] 1 WLR at 25), is at odds with the trend of
thinking in the later cases discussed above and would appear to be difficult to
reconcile with the decision of the Deputy Bailiff and this court in Ani...
Its rigidity would, in any event, sit uneasily with the general approach of the
Royal Court to the exercise of discretion in matters of costs and is not one
that I would want to follow unless constrained to do so (which I am not).
(ii) The fact that the unsuccessful or discontinuing
party has been engaged in the proceedings in furtherance of its public interest
functions must, to my mind, be a relevant factor on the issue of costs. But the manner is best dealt with simply
on that basis - as one element relevant to the court's exercise of
discretion in any particular case - rather than treating that
body's status as automatically giving rise to a hard and fast special
rule, or, for that matter, even a prima.
(iii) The approach adopted by Lord Bingham in
Bradford ... understood in the way that I have suggested, is in my view the
proper and fair one and is moreover in keeping with the governing principles in
relation to the award of costs in the Royal Court, as summarised in Watkins
v Egglishaw .... (2002 JLR 1 at para. 7)." [Emphasis in
original.]
8 Page, Commr. revisited the
matter in Volaw Trust & Corp Servs. Ltd v Comptroller of Taxes (10),
where it was argued that Jersey Fin.Servs Commn. v A.P. Black had been wrongly
decided and where again, after careful analysis, he saw no reason to revise the
approach adumbrated in Jersey Fin. Servs. Commn v A.P. Black as appropriate to
questions of costs where a public body performing a public function is
concerned.
9 In In re Tantular (9),
costs were awarded against the Attorney General on the standard basis, the
court exercising its discretion as to costs on the ordinary principles
applicable to civil litigation. The
position of the Attorney General carrying out a public function was not raised,
nor were the authorities of Jersey Fin. Servs. Commn. v A.P. Black and Volaw
v Comptroller of Taxes referred to the court. Crown Advocate Belhomme confirmed that
none of the arguments put to me on this case was put to that court.
10 Similarly, in the case of In
re Kaplan (5), the defendant was awarded half of his costs on the
standard basis following his successful application to discharge a saise
judiciare against him but again the court had not been referred to the decision
in Jersey Fin. Servs. Commn. v A.P. Black (4).
11 In my
view, Jersey Fin. Servs.Comm v A.P. Black is the only case in which the
principles to be applied in the case of a public body performing a public
function have been considered and analysed and those are the principles which I
should follow."
29. In reaching its determination on the matter
before it the Court, at paragraph 21 of the Judgment said this:
"21 In Jersey Fin. Servs. Commn.
V A.P. Black (4), the court, in declining to make costs orders against the
Jersey Financial Services Commission, gave considerable weight to the need to
encourage public authorities to make and stand by honest, reasonable and
apparently sound administrative decisions made in the public interest without
fear of exposure to undue financial prejudice if the decision were to be
successfully challenged. In the
same way, in my view, considerable weight has to be given to decisions made by
the Attorney General in the public interest to apply for a saise judiciare at
the request of a friendly foreign state seeking assistance under the European
convention on Mutual Assistance in the Criminal Matters."
30. It is right to record that costs were awarded
against the Attorney General in that case but that was, so it appears from the
Judgment, because it had been clear that the Attorney General had persisted in
an argument after, so the court found, it had been "plain and
obvious" that the argument could not succeed.
31. A number of other authorities were put before
me. I do not need to make reference
to all of them.
32. Reference was made to the important case of R
(M) v Croydon London Borough Council [2012] EWCA Civ 595 in which Lord
Neuberger considered at some length how costs should be considered in the
Administrative Court and said, at paragraph 58 et seq. of that judgement:
"58 Accordingly, I conclude that the position
should be no different for litigation in the Administrative Court from what it
is in general civil litigation. In
that connection, at any rate at first sight, there may appear to be a degree of
tension between this conclusion, which applies the "general rule"
in CPR 44.3(2)(a), and the fifth guideline in the Boxall case 4 CCLR 258, at
least in a case where the settlement involves the defendants effectively
conceding that the claimant is entitled to the relief which he seeks. In such a case the claimant is almost
always the successful party, and should therefore, at least prima facie, be
entitled to his costs, whereas the fifth guideline seems to suggest that the
default position is that there should be no order for costs. Similarly, there could be said to be a
degree of tension between what was said in paras 63 - 65, and the view
expressed in para 66 of the Bahta case [2011] 5 Costs LR 857.
59 In
my view, however, on closer analysis there is no inconsistency in either case,
essentially for reasons already discussed.
Where, as happened in the Bahta case, a claimant obtains all the relief
which he seeks, whether by consent or after a contested hearing, he is
undoubtedly the successful party who is entitled to all his costs, unless there
is a good reason to the contrary.
However, where the claimant obtains only some of the relief which he is
seeking (either by consent or after a contested trial), as in the Boxall case
and the Scott case [2009] EWCA Civ 217, the position on costs is obviously more
nuanced. Thus as in those two cases
there may be an argument as to which party was more "successful"
(in the light of the relief which was sought and not obtained) or, even if the
claimant is accepted to be the successful party, there may be an argument as to
the importance of the issue, or costs relating to the issue, on which he
failed.
60 Thus
in Administrative Court cases just as in other civil litigation, particularly
where a claim has been settled, there is, in my view, a sharp difference
between (i) a case where a claimant has been wholly successful whether
following a contested hearing or pursuant to a settlement, and (ii) a case
where he has only succeeded in part following a contested hearing, or pursuant
to a settlement, and (iii) a case where there has been some compromise which
does not actually reflect the claimant's claims. While in every case the allocation of
costs will depend on the specific facts, there are some points which can be
made about these different types of case.
61 In
case (i) it is hard to see why the claimant should not recover all his costs,
unless there is some god reason to the contrary. Whether pursuant to judgment following a
contested hearing, or by virtue of a settlement, the claimant can, at least
absent special circumstances, say that he has been vindicated, and as the
successful party that he should recover his costs. In the latter case the defendants can no
doubt say that they were realistic in settling and should not be penalised in
costs, but the answer to that point is that the defendants should on that basis
have settled before the proceedings were issued: that is one of the main points
of the pre-action protocols.
Ultimately it seems to me that the Bahta case [2011] 5 Costs LR
857 was decided on this basis.
62. In
case (ii), when deciding how to allocate liability for costs after a trial, the
court will normally determine questions such as how reasonable the claimant was
in pursuing the unsuccessful claim, how important it was compared with the
successful claim, and how much the costs were increased as a result of the
claimant pursuing the unsuccessful claim.
Given that there will have a hearing, the court will be in a reasonably
good position to make findings on such questions. However, where there has been a
settlement, the court will, at least normally, be in a significantly worse
position to make findings on such issues than where the case has been fought
out. In many such cases the court
will be able to form a view as to the appropriate costs order based on such
issues; in other cases it will be much more difficult. I would accept the argument that, where
the parties have settled the claimant's substantive claims on the basis
that he succeeds in part, but only in part, there is often much to be said for concluding
that there is no order for costs.
That I think was the approach adopted in the Scott case [2009] EWCA Civ 217. However, where there is not a clear winner, so much would depend
on the particular facts. In some
such cases it may help to consider who would have won if the matter had
proceeded to trial as, if it is tolerably clear, it may for instance support or
undermine the contention that one of the two claims was stronger than the
other. The Boxall case 4 CCLR 258
appears to have been such case.
63. In
case (iii), the court is often unable to gauge whether there is a successful
party in any respect and, if so, who it is. In such cases, therefore, there is an
even more powerful argument that the default position should be no order for
costs. However, in some such cases
it may well be sensible to look at the underlying claims and inquire whether it
was tolerably clear who would have won if the matter had not settled. If it is, then that may well strongly
support the contention that he party who would have won did better out of the
settlement, and therefore did win."
33. In Tesfay v Home Secretary of State for the
Home Department [2016] 1WLR the court cited from R (M) v Croydon London
Borough Council and held that the judge considering costs should ask two
questions:
(1) What was the effect of the withdrawal of the
certification of the Human Rights claim for the claimant. Should the claimant be regarded as
having succeeded so that they should normally receive their costs?
(2) If so, was there a good reason for making a
different Order?
34. At paragraph 67 of the judgment the court said:
"67 In public law litigation securing
reconsideration of a decision which is challenged is usually considered a
success for costs purposes. The
fact that following reconsideration a decision may be taken which is against
the interests of the claimant is
not a reason for refusing costs on the judicial review. As Mr Knafler put it, in a striking
figure of speech, the claimant faced with a new decision against him may
thereafter "stick or twist".
The claimant may accept that he cannot challenge the new decision and
simply seek his costs of the judicial review. Alternatively, he may challenge the new
decision. The fact that he follows
the latter course should not normally affect the costs of securing the
reconsideration."
35. In the case of Speciality Produce Limited v
the Secretary of State for Environment, Food and Rural Affairs [2014] EWCA Civ 225, a Judgment by the Court of Appeal of England and Wales in referring to
the categories set out by Lord Neuberger in Croydon above, the Court, at
paragraph 27 of the Judgment said this:
"........ the further that one moved from the
relatively straight forward category (i) cases, the more difficult it becomes
to make that link with a degree of assurance necessary to justify an Adverse
Costs Order."
36. At paragraph 30 of the Judgment the Court said
this:
"..... in the present
case, there are, in my view, insuperable difficulties in awarding SPL its costs
with a judicial review proceeding.
Even if one puts aside the criticism which Mr Robertson makes about the
timing of the progress of the application, it is not possible to treat the
Minister's acceptance of the outcome of the statutory appeal as anything
more than an acceptance of the appeal decision on the grounds on which it was
taken. It is not possible for us to
say that the Minister's decision owed anything to the potential force of
the claim for the judicial review or that the grounds relied on of abuse of
process and legitimate expectation with themselves and succeeded had they been tried. We have only an outline knowledge of the
issues and we have heard no argument about their prospects of success. The 2011 decision was withdrawn by the
Minister at the end of the Appeal process.
It was not obtained in or by proceedings for judicial review as is
confirmed by the order in those proceedings which (so far as material) simply
withdraws the claim and vacates the hearing date."
37. As I have indicated I have not referred to all
of the cases put before me. In my
judgment there are a number of factors that I must take into consideration in
seeking to do justice between the parties and their respective positions on the
costs of the application.
38. SWM seeks its costs for the reasons that I have
set out, albeit very briefly, and without justice to the full arguments before
me, in paragraph 15 above.
39. Furthermore, SWM argues that the Commissions
process, at least prior to the judicial review leave, was an abuse of process
as the Commission was leaving over and open the possibility of taking
mis-selling into account. That
argument was put on the basis of estoppel.
40. Furthermore, so SWM argues, it was wholly
successful in its aim to stop the mis-selling forming part of any consideration
before the Commission. It had
commenced judicial review proceedings, secured an injunction, and the
Commission had proceeded on a basis other than mis-selling. It had, so SWM argues, been successful
and accordingly, should receive its costs.
41. The Commission resists that application and
indeed goes further in that in its skeleton argument it claims that it should
receive the costs incurred of the costs argument before me and indeed all costs
incurred subsequent to the Commission proposing a discontinuance on a "no
cost basis". Those costs
are claimed on an indemnity basis.
Furthermore, the Commission argues that as the judicial review
proceedings are now merely academic the Commission will be content that leave
to discontinued should only be granted on the basis that SWM pays the
Commissions costs of an incidental to those proceedings. The Commission also seeks the
costs of the costs hearing itself on an indemnity basis.
42. The Commission argues, as may be anticipated
from the authorities referred to above, that SWM's judicial review
application was premature and doomed to failure. In essence, the Commission argues that
at the time of the Judicial Review application it had not made a decision that
was amenable to Judicial Review and accordingly, had its application to have
leave set aside continued, it would have succeeded. Any application for Judicial Review was
premature because the Commission had made no finding and reached no
decision.
43. Furthermore, so the Commission argues, there
was an alternative remedy available to SWM in that SWM had had the opportunity
to consider the 16 October Memo and to make representations to the Board of the
Commission in relation to it. In
the event that SWM had not been content with the decision of the Board at the
conclusion of the DMP then it had the statutory right to appeal to this
Court. As the Commission observes,
the statutory right of appeal would be on the basis that the decision of the
Commission was "unreasonable having regaMemrd to all the circumstances
of the case". The
Commission argues that this approach would have enabled all of the arguments
put forward by SWM in the Judicial Review to be ventilated in the appeal
process. It is submitted by the
Commission that where there is provision within the statutory regime for
appeal, the remedy of judicial review is unlikely to be appropriate.
44. On the matter of the application to set aside
leave for appeal, the Commission points out that when the application was made
to me in Chambers, I sought guidance from SWM's counsel as to the appropriate
test. The note of the ex parte
hearing before me on 4th December, 2019, prepared by SWM's
counsel, reflects that I challenged SWM's counsel on a number of legal
points and asked for guidance as to the appropriate test in considering whether
or not I should grant leave. I did
not at that point have the test in my mind and the matter was pressed on me as
a matter of urgency. Counsel for
SWM was not able to inform me of the terms of the appropriate test and in the
short time available for consideration I characterised it as a requirement of
the application as a "reasonable chance of success". I was not directed to nor did I turn my
mind to the question of whether the decision in respect of which the
application for Judicial Review was being made was a decision capable of
review.
45. It does appear to me that the procedure before
me was less than satisfactory in that regard. I note from the note, however, that I
did ask why the Board should not sit and determine matters and, depending upon the
outcome, the applicant could make whatever application was appropriate. Counsel for SWM argued before me that it
would render the protection of "abuse of process" and "cause
of action" estoppel nugatory.
Conclusion
46. There is, it seems to me, some merit in both
sides of the argument.
47. It may be that there are a number of criticisms
that may be made of the Executive Committee of the Commission and otherwise
over the course of the complaints about SWM and some of these have been
referred to in earlier judgments of the Royal Court to which I have not made
reference herein. However, the
matter of costs is course quite distinct in so far as it relates to the
Judicial Review application.
48. It seems to me that there is a difficulty with
the position of SWM. There was no
decision finally made and whereas it may be possible in the light of a clear
decision that can be subject to a review at an early stage of proceedings to
intervene in part of the process, generally speaking, the authorities seem to
me to point to the fact that a clear decision should be made before Judicial
Review is appropriate.
49. Furthermore, then appears to me to have been an
alternate remedy which would have been to make submissions to the Commission
saying that they should not rely upon any of the material dealing with
mis-selling and then to appeal under the statutory right of appeal had those
submissions been ignored. It does
not seem to me to be appropriate in general to permit a process such as the DMP
to be challenged by way of judicial review at each stage instead of a single
challenge being brought at the end of the process.
50. There is no evidence before me as to what the
Commission would have done had SWM raised the points before it that were raised
in the Judicial Review application.
They may well have elected to proceed, as in fact they did not on the
basis of mis-selling but instead on the basis of all other matters. I cannot be sufficiently certain in my
own mind of the outcome. It seems
to me that it may be the case that SWM succeeded in its Judicial Review
application in procuring an outcome but it may equally be the case that in fact
it faced significant hurdles and the Commission would in any event have
proceeded as it did in the light of submission from SWM.
51. In applying the principles from the cases
above, and in particular from the Croydon judgment of Lord Neuberger it seems
to me that we are in the third category in as much as it is difficult to
determine without considering the evidence carefully, that SWM would have
inevitably prevailed in its application.
That being the case, the correct order would normally be that each party
bear its own costs.
52. It seems to me that the order that best suits
the justice of the case is that there be no order for costs of and incidental
to the Judicial Review application, and the application to discontinue and the
application for costs before me.
Authorities
Royal Court Rules 2004 (as amended).
Civil Proceedings (Jersey) Law 1956.
Watkins
v Egglishaw [2002] JLR 1.
Welsh
v The Deputy Judicial Greffier [2009] JCA 145C.
Lord Bingham in Sharma
v Browne Antoine [2007] 1 WLR 780.
Clear
Mobitel (Jersey) Limited v Jersey Competition Regulatory Authority [2011] JRC 181.
AG
v Rosenlund and Others [2016] (1) JLR 348.
R (M) v Croydon
London Borough Council [2012] EWCA Civ 595.
Tesfay v Home Secretary of State for
the Home Department [2016] 1WLR.
Speciality Produce
Limited v the Secretary of State for Environment, Food and Rural Affairs [2014] EWCA Civ 225.
