High Court refuses costs on appeal due to clarified public interest law and special circumstances.

[2019] IEHC 778 THE HIGH COURT [2017/No. 13 C.A.T.] BETWEEN THE ENVIRONMENTAL PROTECTION AGENCY APPLICANT(RESPONDENT)

AND THOMAS DEEGAN RESPONDENT(APPELLANT) JUDGMENT of Mr. Justice Bernard J. Barton delivered on the 17th day of October, 2019

Introduction; the Issue

1. This judgment is concerned with the costs order which is to be made for the costs of the appeal in the proceedings, judgment therein having been delivered on the 31st July, 2019. The case was adjourned to enable the parties consider the judgment and make submissions on the final orders to be made. At the adjourned hearing the Respondents sought the costs of the appeal together with the costs of the proceedings in the court below. The Appellant opposed the application for the costs of the appeal and invoked the discretionary jurisdiction of the Court to depart from the normal rule that costs follow the event. Accordingly, the issue which falls to be determined is whether the Court should exercise its discretion or accede to the application.

Submissions

2. Submissions were made on behalf of the parties which will not be summarised. Suffice it to say that having succeeded on the appeal Mr Tracey S.C. contended that the ‘normal rule’ applied and an order should be made for the Respondent’s costs in both courts.

Opposing the application, Mr O’Reilly S.C. argued that there were a number of factors which warranted the Court in exercising its discretionary jurisdiction to depart from the ordinary rule and refuse the application; the circumstances of the case were special and the law had been clarified on a matter of public importance.

The Law

3. With regard to the awarding of costs the Court has an inherent discretionary jurisdiction, recognised by O. 99 r. (1) of the Rules of the Superior Courts, the exercise of which is regulated by law. The general rule is encompassed in O.99 r. 3 which provides that costs are to follow the event unless the Court, for special cause to be mentioned in the order, otherwise directs, described by Denham J., as the ‘normal rule’ in Grimes v. Punchestown Development Company Ltd [2002] 4 I.R. 515, 522.

4. The rational for the rule was explained by Clarke J., (as he ten was) in Veolia Water UK Plc v. Fingal County (No. 2) [2007] 2 I.R. 81, at 85

“(T)he overriding starting position should remain that costs should follow the event.

Parties who are required to bring a case to court in order to secure their rights are, prima facia, entitled to reasonable costs of maintaining the proceedings. Parties who successfully defend proceedings are, again prima facia, entitled to the costs to which they have been put in defending what at the end of the day, the court has found to be unmeritorious proceedings.” In its application the rule requires the identification of the event from which the costs order is to flow. It does not necessarily follow, however, that the party who has ‘won’ will obtain an order for the costs of the proceedings. In complex cases, for example, where multiple substantive issues may arise for determination there may be a corresponding number of ‘events’ which may attract the operation of the rule in favour of a party who while successful on the issue is unsuccessful in the suit as a whole. See Veolia Water supra; and Fyffes plc v DCC plc [2009] 2 I.R. 417 at 679.

5. The Court has a discretionary jurisdiction to vary or depart from the normal rule if, in the special circumstances of a case, the interests of justice require that it should do so; the Court is not at large. Discretion may not be exercised upon the caprice of the judge or for extraneous reasons such as economic disparity between the parties, although in exceptional circumstances real economic hardship may constitute an exception. See MN V SM (Costs) [2005] 4 I.R. 464.

6. As with the determination of all other issues, the parties are to be treated with equanimity by the Court in the exercise of its discretion: to proceed otherwise would run the risk of offending the fundamental right to equality before the law guaranteed by Article 40.1 of the Constitution, hence the general rule that the successful party should have the costs of the proceedings. Any variation or departure from the normal rule must be founded on a reasoned decision in the special or unusual circumstances of the case wherein the factors warranting the departure are indicated. See Fyffes Plc, supra; Dunne v. Minister for the Environment [2008] 2 I.R. 775, and McAleenan v AIG (Europe) Ltd [2013] 3 I.R. 202.

7. While decided cases may indicate the nature of the factors which may be relevant, given the myriad of suits and circumstances in which the exercise of the jurisdiction maybe invoked it would neither be possible, practical nor desirable to attempt to define or categorise the factors which might warrant the exercise of the jurisdiction, rather, it is the factors or a combination of factors in the context of the case viewed against the background of certain identified principles which determine the issue. The special or unusual circumstances in proceedings involving a point of law on a matter of general importance are material considerations to the resolution of the issue as to whether or not the Court’s discretionary jurisdiction should be exercised.

Decision

8. A suit where there is doubt about the proper interpretation of the common law, the Constitution or a statute in a suit between public bodies or between a private party or class and a public body, the State or a State agency, the outcome of which is of general importance, constitutes what academic commentators and judges alike refer to as a test case in the circumstances of which the discretionary jurisdiction of the court maybe exercised. It is evident from the principal judgement herein that the case brought by the Respondent, a State agency charged with responsibility for protecting the environment, involved statutory provisions the construction of which was in the public interest; the outcome will inure for the public benefit and provide greater clarity for all of those involved in the commercial harvesting of peat.

9. The harvesting of peat and the exercise of turbary rights, many of which are of great antiquity, has been a ‘hot political potato’ which has excited certain communities, particularly in the midlands, to the point where a number of right to harvest ‘turf’ campaigners have been elected to Dáil Éireann. Measures introduced by the State to prevent, restrict or control the harvesting, whether for private or commercial consumption, of peat or sod turf in furtherance of environmental protection objectives is an issue of general interest to communities who are dependant directly or indirectly on the utilisation of bog lands as a source of employment whether by by Bord Na Mona, private commercial operators or ancillary industries. . The scale of operations, particularly in the midlands, and the licensing of commercial peat harvesting in the context of environmental and habitat protection is of considerable commercial importance.

10. The importance is illustrated by the attention devoted to peat harvesting indomestic legislation enacted before the promulgation of the European Directives on the environment which in turn led to the enactment of provisions which gave rise to the proceedings. While the resolution of the issues will have a continuing impact on the Appellant, the outcome will also serve to clarify licensing compliance requirements for any individual or corporation engaged in the commercial harvesting of peat anywhere in the State. The decision in EPA v. Harte [2015] I.R. 462, upon which the learned Circuit judge relied, settled the issue at the centre of the controversy in these proceedings until subsequently set aside by the Court of Appeal thereby founding one of the grounds of the appeal herein. Accordingly, it fell to the Court to construe the relevant provision de novo and determine whether an IPPC licence was required

Conclusion

11. For the reasons set out herein and mindful that the orders for costs in the Circuit Court have been affirmed, the Court will exercise its discretionary jurisdiction to refuse the application. In all the circumstances, I consider the justice of the case is most appropriately met by the Court making no order as to costs on the appeal.