Criminal Justice and Courts Bill

Lord Faulks Excerpts

Monday 27th October 2014 Lords Chamber

[Baroness Kennedy of The Shaws (Lab)]

My Lords, I know that there is always a sigh in this House when a debate is dominated by lawyers. However, I remind the House that sometimes it is lawyers who know the pain that citizens in our country experience, because we represent them, and that this is about the actual lives on which judicial review has an impact. It is always about the person whose business is to be closed down from trading, based on a department’s or a local authority’s decision that they want to challenge, or the person whose mother is in a care home and suddenly finds that it is being moved or closed down, with no consultation as to the impact on her and her family. It may be about the effect on a disabled child of a decision about their schooling. Those things are about real people’s lives and that is why this is not just a constitutional debate of high flown words or complicated legality—it is about the real impact on the lives of ordinary people.

When your Lordships come to vote in our Lobbies, as I am sure you will be asked to do, I say to those of you who are not lawyers that this is really about people’s lives and about the law coming into play to protect citizens. That is why lawyers and organisations such as the Bar Council, the Law Society and Justice—cross-party and no-party organisations—know why the rule of law matters in our nation and our democracy. This is not, I say to the Minister’s noble friend Lord Tebbit, about judges somehow usurping the power of Parliament. This is about justice, fairness and the things that we hold dear, so I say to my colleagues in this House who are not lawyers that this is not a festival of lawyering. It is about ordinary people.

[The Minister of State, Ministry of Justice (Lord Faulks) (Con)]

My Lords, we now turn to Part 4 of the Bill, which has proved to be one of the more contentious areas at Second Reading, in Committee and today. The debate has ranged far and wide and it has been magnificent. We have discussed the constitution of the United States, the merits of the European Union, the Council of Europe, King Charles I, fracking, the Severn barrage and HS2, to name a few topics. I am sure that noble Lords will understand if I do not deal with all of them.

Similarly, there have been speeches of an omnibus nature, particularly by the noble Lord, Lord Beecham, and my noble friend Lord Marks, in the sense that they have covered matters beyond Clause 70. I will deal with those arguments when we come to the relevant groups. We are focusing on Clause 70 at this juncture. The Government have listened with great care to the arguments raised by noble and learned Lords and noble Lords during those debates. I assure my noble friend Lord Cormack that I have listened carefully again this afternoon to the speeches made by a large number of your Lordships. However, we do not resile from our central contentions, which I trust the House will allow me to set out briefly.

First, it is our contention that judicial review, when used properly, is an essential component of the rule of law. It allows individuals and businesses to invite the court to test the lawfulness of public bodies’ actions. Secondly, judicial review as it presently stands is not always perfect. On several occasions, the Government have set out some of the examples of delay and cost which can be caused, such as the challenge to the exhumation licence concerning the mortal remains of King Richard III which the noble Lord, Lord Beecham, described as “ludicrous”, despite his own view that York is the more appropriate resting place.

Thirdly, while we have taken some steps, working with the judiciary where appropriate, to rebalance the current approach, such as through the creation of the planning court, some further reform is needed. Noble Lords may be aware that the use of judicial review has increased more than threefold in recent years from around 4,200 in 2000 to around 15,600 in 2013.

The noble and learned Lord, Lord Woolf, was kind enough during our Committee debates to offer me a copy of De Smith’s Judicial Review, of which he is a distinguished editor. I have to say that he honoured his pledge most generously. I have been in receipt of De Smith and I have done my best to reacquaint myself with its contents. The preface to the seventh and most recent edition reads as follows:

“English administrative law is now one the most celebrated products of our common law and doubtless the fastest developing over the past half century”.

We accept that many judicial reviews will be well founded and brought in good faith, and that much of the growth has been driven by the number of immigration and asylum cases, but it remains a simple fact that a well timed judicial review can delay the implementation of crucial policies or projects for months or even years. Even when decisions are perfectly in line with due process, months can be spent preparing for and defending claims when that time would be better spent taking forward the reforms that the country needs.

The debates have been, perhaps predictably, dominated by those with long experience of the law and, of course, on the government Benches we welcome the expertise which has been brought to bear, even if we do not always welcome the contents of all the speeches. However, there is another side to judicial review—one which pertains to what happens, or does not happen, outside the courtroom as judicial reviews proceed. As they proceed, arguments are made and countered; witness statements are prepared and probed; and fine points of law are weighed and determined. Crucial projects with direct implications for jobs are delayed, perhaps lost.

For example, a judicial review was initiated by a competitor to the proposed development of a supermarket in Skelton, North Yorkshire. That challenge was described by the judge at the earliest possible opportunity as “a hopeless case”. Yet work was delayed for six months. Irrespective of the rights and wrongs of the case itself, is it right that a hopeless judicial review can be used to such effect? The risk of this happening was recognised by that great judge Lord Diplock who, when emphasising the importance of the permission stage in judicial review said:

“The requirement may also prevent administrative action being paralysed by a pending, but possibly spurious, legal challenge”.

I quote from Inland Revenue Commissioners v National Federation of Self-Employed and Small Businesses 1982 appeal case 617 at page 643.

It is important that we do not ignore the fact that such cases place a considerable burden on the public purse in terms of the time of judges, lawyers, Ministers and officials. Overall figures are not recorded, and are probably not recordable, but by way of illustration, I can report that the total legal costs of the Richard III case to the Ministry of Justice alone have been put at more than £90,000, none of which is recoverable. Consequently, we make no apology for having taken some sensible steps already, and none for making a few more small but important changes.

Outside your Lordships’ House the debate about these reforms has been rather long on hyperbole. Reference has been made during the debate today, and indeed in Committee, to left-wing causes. Of course, I entirely accept that it is irrelevant whether a cause is left-wing, right-wing or apolitical. What matters is whether the challenge is justified and whether it has merit. However, I have seen it suggested that the Government wish to do away with judicial review altogether and even that these reforms will lead to imprisonment without trial. As I will explain, these fears are entirely ill founded. The Government believe that the roles of Parliament and the courts should exist within a relationship of mutual respect and co-operation. In that context, I should emphasise what the provisions do not do: they do not seek to undermine or fetter judicial discretion; they do not seek to challenge the basis on which judges approach questions of judicial review; and we have not altered legal standing, much as that was open to criticism. That was a response to the consultation paper.

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[Lord Beecham]

My Lords, the Opposition will support the amendment moved by the noble Lord, Lord Pannick. It seems to me quite possible, within the framework of that amendment, to proceed along the lines mentioned by the noble and learned Lord, Lord Mackay, and the noble Lord, Lord Lester.

[Lord Faulks]

My Lords, Clauses 71 and 72 are about transparency. They require an applicant for judicial review to provide, with their application, information on funding for their case and that the court considers this information when exercising discretion to order costs. It is important to emphasise that, while permission will not be granted until information has been provided, there is no question of preventing permission if the applicant’s funding is insufficient, and the judiciary continue to have complete discretion in relation to the making of costs orders against third parties disclosed in that information.

Requiring the applicant to provide this information to the court will give the court the information necessary to achieve flexibility in apportioning costs fairly, and to prevent a third party from using a front man or shell company to shield themselves from incurring their share of costs. Your Lordships have heard that there is a potential problem, and although it is not always easy to know what the situation is, this provision should enable the courts to make their decision based on evidence. We say that the judges do not always have all the relevant information available or presented to them, which has the potential to hinder their ability to order costs in a just and equitable manner.

Amendments 157 and 158 would stop the provision of information about financial resources being mandatory, allowing for permission to be granted where no information has been provided but permission is “nevertheless appropriate”—which is undefined. The Government consider this unnecessary, as the clause does not stop permission being granted if insufficient finances are available. It requires only that the court should be provided with an accurate picture. The court still has discretion.

The clauses will not require onerous or invasive information from applicants, and the information requested should always be information that the applicant would have, even if they did not have funding at that stage. The clauses are designed to promote transparency in court proceedings, not to provide for a time-consuming forensic examination of an individual’s financial affairs.

The noble Lord, Lord Beecham, has not moved Amendment 156. The amendments tabled by the noble Lord, Lord Marks, and Amendment 162, tabled by the noble Lord, Lord Pannick, seek to change when the court should have regard to funding information, and what that information should be. My understanding is that they rely on Clause 71 being removed from the Bill and set out the power for the court to require the applicant to provide certain information about funding when the court is determining, or intends to determine, costs. They also limit the information to sources of funding that are actually available to the applicant, rather than sources that are likely to be available, and rather than looking at the applicant’s ability to fund the judicial review generally, the information would be limited to how the applicant would meet the other side’s costs.

Amendment 161A would mean that those who are likely to fund and drive litigation could escape the appropriate costs liability simply by not promising to provide the support. Amendments 160 and 161 seek to instate a position where the court need not consider financial information provided by the applicant, even if it considers it appropriate. In my view, these amendments are unnecessary and defeat the point of Clause 71 in making sure that the court has clear and transparent information early in proceedings.

The key to Clauses 71 and 72 is they do not create new cost liabilities for claimants, nor does the sufficiency of funding they demonstrate have an impact on the progression of the case. In answer to the noble Baroness, Lady Lister, the courts would not be expected to make an award against a third party who was simply funding the litigation and not seeking substantially to control, influence or benefit from it. I said words to that effect in Committee; I say them again now, and I hope those words will be useful when anyone comes to interpret this provision should it become law. It is clear that the applicable case law requires more than only funding; as in the case law referred to by my noble friend Lord Lester, the person must be seeking to drive the litigation or to benefit from a potential remedy in the case. I should emphasise that.

Under those principles, costs awards are not prescriptive, nor is it our intention that they should be. We are simply allowing the court to make decisions with the appropriate information available to it. For example, the court will not have to make an award against a parent in a school challenge case and would not be expected to do so. We do not agree with Amendment 162 that prospective funding or the ability of company members to provide financial support can be excluded from this consideration, nor do we agree that the court should consider only those who have promised to provide funding. In our view, that creates an easily avoidable threshold.

We also do not agree that this information should be provided only on the making of an order by the court, as stated in Amendment 159B. There is no reason why the court should not be informed of the parties driving litigation early on in proceedings, as this would enable the judge to make decisions on costs without having to order the parties to provide information. Essentially this amendment seeks to favour the opaque, rather than the transparent. What information an applicant should provide will be set out in court rules. The rules will not require invasive financial information but will require the claimant to be clear about the sources of their funding. It will be perfectly acceptable to update the court if funding does not materialise; that was a point made in Committee and I would like to make that clear. The requirements will not be burdensome for claimants. The Government have on many occasions stated that they wish to see a light-touch approach, and I am sure that any rules will be fair and proportionate to the court’s need for transparency.

The noble and learned Lord, Lord Brown, made reference to the judiciary’s response. I am sure he has read carefully what it is and I am in no position to contradict it. My understanding was that the judiciary had welcomed transparency, although, having revisited what I said in Committee, I did not seek to rely specifically on that as the only basis for this argument. He may well be right that the comments were directed more at non-parties than in the situation of an applicant. If I inadvertently misled Parliament, I make it absolutely clear that that was not my intention.

The requirement for transparency is wholly understandable and wholly consistent with judges making decisions on the best possible information. The question is: is this going to be chilling? I suggest that it will not be chilling to those who have good reasons for bringing claims and who are, as one would expect, open and frank about what, in financial terms, is driving the challenge.

This has been a useful debate and I hope it has enabled me to be clear about what lies behind Clauses 71 and 72 and to allay any remaining concerns. The Government take the view that these clauses do not take away the judge’s discretion. As is always the case, he or she will make the decision on the basis of the facts of each case. These clauses enable the judge to have better information before exercising the discretion. No judge wants to exercise a discretion in the absence of all the information that could reasonably be made available to them. It is not obvious to me why this is as objectionable as it is said. With that reassurance, I hope that the noble Lord will be prepared to withdraw his amendment.

[Lord Pannick]

My Lords, the purpose of Amendments 157, 158, 160 and 161, which are all of a piece, is simply to ensure that the court has a discretion rather than a duty in relation to information about the funding of judicial review. It is very important to be clear in the Bill that the court retains a discretion in relation to these matters. That is what these amendments seek to do in relation to funding issues. I wish to test the opinion of the House on Amendment 157.

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[Baroness Campbell of Surbiton (CB)]

My Lords, I wish to add my support for the amendments proposed by my noble friend Lord Pannick. This provision will, indeed, deter interventions from organisations with limited resources—organisations, as my noble friend Lord Low suggested, that are likely to have the best and most pertinent expertise about the more vulnerable sectors of our society: children, disabled people, elderly people. Judges have publicly recognised the value of specialist knowledge in helping them to make informed decisions, as demonstrated by my examples in Committee. I had the privilege to be involved in interventions in two landmark cases where my organisation and individual knowledge could contribute to the outcome, which everybody heralded as a great success. I know that the Government’s reforms would have deterred me and my organisation from intervening. I believe that cases will be very poor for that.

It is critical that intervention remains readily available and that we do not deter weak charities and individuals who are quite sceptical about getting involved at all. Let us face it, intervening in a High Court case is a scary prospect. I know because I remember I was terrified. Therefore, I believe that these provisions will have a devastating effect, particularly on the community that I know best, disabled people—the very people who need the most support, protection and expert advice, coming from maybe some of the people who know them best and who have themselves experienced what they might have been going through or might go through. Clause 73 cannot be allowed to stand because there will be no interventions of such knowledge and value—interventions that have literally changed the lives of some disabled individuals and interventions that will change the lives of those who come before the courts in the future.

[Lord Faulks]

My Lords, I am grateful to all noble Lords who have taken part in the debate on interveners. The position is that any person may apply to the court to give evidence or make representations in judicial review proceedings. However, we think it is right that people who intervene in judicial reviews should have a fairer financial stake in the case and do so in a way that does not cause the true parties to the judicial review additional costs.

Clause 73 aims to strengthen the costs rules in relation to third parties who voluntarily apply to join in judicial review cases as interveners. It does this by establishing two presumptions: first, that the court will order an intervener to pay their own costs—that is normally the position now; secondly, that it will order an intervener to pay the reasonable costs that they cause a party to the judicial review to incur by their intervention. However, neither would apply where, in the view of the court, there are exceptional circumstances making it appropriate for that presumption to be rebutted. Neither presumption will apply when the court invites an intervention—and courts do quite often invite interventions. The clause will not affect the judge’s ability to invite whichever interventions, from whichever interveners, he or she sees fit.

The clause has been subject to significant debate and, as I said at Second Reading and in Committee in this place, and as my honourable friend Shailesh Vara said in the other place, the Government wanted to look again at how best to ensure that interveners consider carefully the costs implications of intervening, while not deterring appropriate interventions in appropriate cases, and, as a result, whether any changes to the clause were required. We have taken into account the views expressed in this House and the other place. The Government have listened to the concerns raised in Parliament and by stakeholders but consider that the current clause is right and are not persuaded that amendment is needed. The Government have considered and discussed the clause in some detail. I know that my ministerial colleagues have also discussed it with fellow Peers. I regret to say that we have been unable to agree an alternative formulation. The Government recognise that interveners can add value to a case and we do not want to stop that. However, interventions should be made in the right cases after careful consideration beforehand. That means that interveners should have a fair financial stake in the case.

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[Lord Deben]

My Lords, I am grateful to my noble friend for giving way. I am listening very carefully. The tiny bit that I do not understand is why the judge should not have discretion to decide whether the case merits payment of costs or not. The discretion is very bound, because he has to maintain that these are exceptional circumstances. I find that difficult. Why cannot he be given the right to say, “In this case, they ought to pay because they have been in one way or another negligent”, or have overcharged, and in another case that they should not? Why cannot we leave it to the judge? It is his court and he should make the decision.

[Lord Faulks]

My Lords, of course that is the burden of the argument in favour of the amendment, and that is the current situation. The clause is intended to place a higher burden—we accept that it is a higher burden—on interveners to think carefully about the intervention that they intend to make as to whether it is truly worth while.

Before my noble friend’s intervention, I was stressing that the judge has discretion over both aspects: causation and quantum. The intervention may have caused only a degree of additional costs, rather than the entire costs of the action, which will modify the intervener’s exposure to costs. That will be a matter for the discretion of the judge. Of course, it is ultimately up to the judge to decide what are exceptional cases. Judges have different views as to what constitutes an exceptional case, but ultimately it is for the judge. It is very rare, if at all, that one sees appeals on questions of costs having any success. Amendment 164 would remove both presumptions that the clause creates, replacing it with a general discretion, which my noble friend would like, for the court to award costs either for the intervener against a party or to require the intervener to pay the parties’ costs. That is the status quo.

Clause 73 has been criticised for being too broad and meaning that interveners could be expected to pay costs in any circumstances. Critics have said that that means that an intervener would not be able to intervene in important cases and provide assistance to the court, as the risk of adverse costs is too unclear and potentially too great. Under Clause 73, what amounts to exceptional circumstances will ultimately be set out in court rules. That will provide clarity for an intervener at the point where they are considering whether to intervene on the manner in which they should carry out their intervention or risk costs.

Clause 73 does not mean that in every case where an intervener is involved they will be forced to pay all the costs of all of the parties, but it is right that they have a fairer financial stake. All those with experience will confirm that, just as interveners can add value, they can delay and hinder and make arguments that simply amplify or repeat—

[Lord Lester of Herne Hill]

I am grateful to the Minister, and I apologise for intervening at this late stage, but I do not understand from his reply how he can cite cost saving as a justification for giving detailed instructions to the courts about matters that are well within their discretion. Nor do I understand why a different rule should apply to the Supreme Court from that applied in others or in Northern Ireland from that applied in England and Wales.

[Lord Faulks]

I think that I have answered my noble friend’s point on the difference between the Supreme Court and the courts at a lower level. On costs, as I said, with this clause we hope to deter inappropriate interventions and also to make interveners think about the scale of their intervention so as to reduce the costs for all parties, whether applicants or respondents, and to ensure that those interventions are relevant and genuinely assist the court.

These clauses apply to judicial review in England and Wales. Scotland and Northern Ireland have separate legal jurisdiction on this question because it is devolved, but of course if they intervene in a court in England and Wales that would be a different matter.

Interveners can also, as I think is accepted, make arguments that go beyond what is necessary. The changes that Clause 73 introduces reflect the Government’s intention of ensuring that they do so in an appropriate manner. We submit that the overall effect of the clause, while not drastic, will reduce the number of cases—and the noble Lord, Lord Pannick, says that there are very many cases where interventions take place—in which the taxpayer is expected to shoulder the burden.

That is what Clause 73 does and why the Government, having considered the issues, are of the view that the provision represents a sensible, workable and balanced position that takes proper account of the role of the judiciary, which will remain at the centre of this issue. Therefore, having provided an explanation of the Government’s thinking, I ask the noble Lord to withdraw the amendment, and I commend Clause 73 to the House.

[Lord Pannick]

I am grateful to the Minister and to all noble Lords who have spoken. This short debate has, I think, illuminated and emphasised just how bizarre Clause 73 is, because there is no dispute that interventions by third parties at all levels of judicial review assist the court by the provision of information. That is simply not in dispute.

There is also no dispute that interventions by third parties are already under the control of the court. They are under the control of the court as to whether they are allowed, on what grounds, and with what consequences on costs, having regard to the issues in the case. It is true, as the Minister says, that there have been more interventions in recent years, but that is only because courts find them helpful and have allowed third parties to intervene. If interveners act inappropriately —and I am not aware of any cases where this has occurred, with the exception of one possible case in the Appellate Committee, which, as it is now the Supreme Court, would not be covered by this provision in any event—the judge has ample power, at present, to order the payment of costs. That point was correctly made by the noble Lord, Lord Deben, who also rightly referred to the limited scope of the exceptional circumstances provision. The problem is that there is nothing exceptional about interveners assisting the court. That is what they normally do.

When an expert body is deciding whether to intervene and assist the court, it will know, if Clause 73 is enacted in its present form, that there is a strong presumption that it must pay the costs. The inevitable consequence is that it is unlikely to intervene. This will not achieve the Minister’s policy aim of, as he said, deterring inappropriate interventions; it will deter interventions, however helpful they may be to the court.

Clause 73 makes no sense whatever. It makes no sense, with great respect, to speak of a need to make interveners have a financial stake in the proceedings. The court has ample power to penalise them in costs. Amendment 164 will maintain judicial discretion in Clause 73, just as your Lordships have decided that judicial discretion should remain in Clauses 70, 71 and 72. I wish to test the opinion of the House.