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Changes to the rules on legal costs in environmental cases
Although Judges have full discretion, the general rule in court cases in Ireland is that the loser pays the winner’s legal costs.
The 2010 Planning Act radically changed this rule for judicial review proceedings relating to decisions that give effect to the Environmental Impact Assessment Directive, the Strategic Environmental Assessment Directive and the Integrated Pollution Prevention and Control Directive. The new default rule for these legal proceedings is that each party must pay its own costs, subject to four very limited exceptions. The new costs rule is currently being challenged in proceedings before the Irish Commercial Court.
The 2011 Act extends the costs rule that each party must bear its own costs, and the exceptions, to certain other environmental cases.
The Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters (the “Aarhus Convention”) lays down rules to promote citizens’ involvement in environmental decision-making. Under the Aarhus Convention, and the European rules that implement it, Ireland is obliged to allow the public to appeal decisions and ensure any appeal procedure is “fair, equitable, timely and not prohibitively expensive”.
The Minister has stated, on the advice of the Attorney General, that in order for Ireland to ratify the Aarhus Convention, it was necessary to: (a) amend the costs rule introduced by the 2010 Planning Act; and (b) introduce a provision limiting the costs of environmental court cases.
Ireland’s response to limiting the costs of environmental court cases – the new costs rule
The 2011 Act extends the rule, that each party has to pay its own costs, to apply to environmental court cases where a person institutes proceedings to ensure compliance with environmental licences, or permits, or in respect of a breach of a licence, or permit, if the circumstances have caused, or are likely to cause, damage to the environment.
For example, injunction proceedings to ensure compliance with:
• an IPPC licence;
• a waste licence;
• a waste collection permit;
• a trade effluent licence;
• a foreshore licence;
• a dumping at sea permit;
• an exploration licence; and
are all now subject to the new rule that each party must bear its own costs.
The new rule that each party must pay its own legal costs does not apply to all or any part of court cases seeking damages for breach of environmental licences or permits (e.g. negligence actions for damage to the environment). Nor does the rule apply to proceedings taken by a statutory body or a Minister.
New exception to the rule that each party bears its own costs – planning legislation
The 2010 Planning Act set out four limited exceptions to the rule that each party must pay its own legal costs. The court can award costs against a party: (1) if a claim is frivolous; (2) if a party is in contempt of the court; (3) because of the manner in which a party conducts its case. (4) The court also has a discretion to award costs in favour of a party in a case that is of "exceptional public importance" and if it is in the interests of justice.
The 2011 Act introduces a new exception. The court has a discretion to award a person, who successfully prosecutes legal proceedings, all or a portion of his/her legal costs from the defendants, if the defendants are at fault.
Exceptions to the rule that each party bears its own costs – environmental court cases
The 2011 Act mirrors the same four exceptions for recovering costs in environmental court cases and the new exception that gives the court a discretion to award a person who successfully prosecutes legal proceedings all or a portion of his/her legal costs from the defendants, if the defendants are at fault. Potential defendants in environmental court cases include State body decision-makers, licence/permit holders and operators of facilities.
Given that the costs rule introduced by the 2010 Planning Act has led to court challenges, it remains to be seen how the amendment to, and extension of, the new legal costs rule to other environmental cases will be received.