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The Queen on the Application of Key Cabs Limited t/a Taxifast v Plymouth Crown CourtCO/7689/2006

High Court of Justice Queen's Bench Division Administrative Court

9 November 2007

[2007] EWHC 2800 (Admin)2007 WL 4190529Before: Mr Justice Mitting

Friday, 9th November 2007

RepresentationMr Alan Newman QC (instructed by Messrs Ashfords , Plymouth) appeared on behalf of the Claimant.

Mr James Findlay (instructed by Plymouth Legal Services ) appeared on behalf of the Interested Party.

JudgmentMr Justice Mitting:

1 On 7th March 2006, after an 11-day hearing, the Crown Court at Plymouth, presided over by Mr Recorder Fuller QC, allowed an appeal by Key Cabs Ltd (“the claimants”) against the refusal to grant one hackney carriage licence by Plymouth City Council (“Plymouth”). It rejected the claimant's appeal against the refusal to grant 29 further licences, for reasons which I have already dealt with in the appeal by way of case stated against that decision. It is common ground that the issue concerning those 29 licences occupied little of the time of the court below.

2 The main issue was whether or not Plymouth had established that there was no unmet demand within its area for more hackney carriages than were already licensed. On that issue the claimant won. There were four significant evidential matters which bore upon it: the questionnaire conducted by Mayflower, as subcontractors of the agency retained by Plymouth to test public opinion in Plymouth; observations at taxi ranks; a consultation exercise; and the processing of the data produced by the first two. Much of the first week, from 6th to 10th February 2006, was spent on the first issue.

3 By the time the hearing resumed, on 28th February 2006, the claimant had obtained evidence that the survey was in significant part bogus. The evidence which they called to that effect on 2nd and 3rd March 2006 was accepted as true and reliable by the court, and the contrary evidence as unreliable. The court's conclusion was that the survey was “seriously reduced in its impact and effect”, so much so that the court in fact said that it would refer the survey papers to the Director of Public Prosecutions.

4 The court accepted the evidence of rank observation as far as it went, but concluded that there was no reliable evidence about an issue which it said was important: delays in flagging down hackney cabs in the street. It accepted that the consultation exercise was properly conducted and provided a representative sample, and that the method used to process data was appropriate. Its overall conclusions are set out in paragraph 57 of its judgment:

“57. On the first issue we are not satisfied that the data produced by the Mayflower questionnaires is sufficiently extensive or reliable. There may well have been some properly conducted questionnaires but in a large part our view is that the necessary representative sample of Plymouth has not been given a voice in this survey. The survey contains important questions in our view, such as those dealing with waiting times for flag downs and this question in the absence of other data, as I have said earlier, remains unanswered. Whilst accepting in large part the overall reliability of the rank survey conclusions, we do not consider that the questionnaire is of such secondary importance that the respondents can rely wholly on rank observation and consultation to discharge the burden upon them, even bearing in mind the questionnaire's secondary importance, we consider it an important background against which other data can be scrutinised. It is also a valuable tool in identifying suppressed demand. Accordingly we are unable to accept that the respondent has established on the balance of probabilities that there is no significant unmet demand.”


5 court then heard submissions on costs. Its attention was drawn by both sides to City of Bradford MDC v Booth, 10th May 2000 , especially paragraph 26, in which Lord Bingham CJ stated:

“Where a complainant has successfully challenged before justices an administrative decision made by a police or regulatory authority acting honestly, reasonably, properly and on grounds that reasonably appeared to be sound, in exercise of its public duty, the court should consider, in addition to any other relevant fact or circumstances, both (i) the financial prejudice to the particular complainant in the particular circumstances if an order for costs is not made in his favour; and (ii) 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 is successfully challenged.”


6 In a short judgment, it determined that Plymouth should pay 60 per cent of the claimant's costs:

“The appellant in this case has been successful and Mr Newman submits that costs should follow, as generally they may. The consideration that we are now asked to bring to bear by Mr Findlay revolves around the fact that as he submits, with some force, the length of these proceedings has been driven by the headlong assault, as he calls it, by the appellant on the respondent's methodology in the unmet demands survey, and also by seeking through evidence to establish significant unmet demand.

In both these respects, as our judgement has made clear, the appellant has failed. The Council have, in our view, acted reasonably throughout in resisting this appeal. But, unusually in this case, through the appellant's investigation, have been able to show that the Council had been the recipients, unknown to them, of a report that was flawed in a particular respect, which enabled the appeal to be successful.

Mr Findlay has reminded us of the parts of the judgement in Bradford and Booth. He also suggests that there is an absence of particular prejudice to the appellant, if he had to shoulder the costs. Though shouldering the costs of an appeal like this cannot be regarded as anything else but to an appellant's prejudice. And he also, as does Mr Newman, reminds us of the overriding duty that we must abide by and that is to do justice between the parties as best we can.

What we consider a just and reasonable award in the circumstances of this case, taking a broad view of the issues that have been raised, won and lost, and considered in this case, we consider that the fair and proper way to deal with the costs in this case is [to] order that the respondents pay 60 per cent of the appellant's costs. That will, of course, hereafter be subject to detailed assessment.”


7 On 8th March 2006 Mr Preece, the claimant's managing director, issued a press statement, which read:

“The costs of this case have exceeded £450,000.00 and there should be a transparent inquiry set up to examine the Council's performance in this matter. Taxifast has had to fight with a budget against a bottomless tax payer's purse and one has had to ask why? We are currently considering our position of the Court ordering the Council to pay 60% of our costs and the Council have to pay 100% of their own.”


8 On 10th March Plymouth wrote to the court a letter in which they sought to reopen the question of costs. The opening paragraphs read:

“With some considerable reluctance the City Council respectfully requests that you reopen your decision as to costs because of information that has come to light as to the likely magnitude of those costs.

At the hearing, you were addressed on the basis that costs were likely to be well over £150,000. That was a figure mentioned by our counsel, without correction by the Appellants. However, it appears from the attached newspaper article that costs are likely to be in excess of £450,000. That figure is not just over or well over £150,000, it is an extraordinary sum even for an 11 day hearing.”

The letter went on to seek the reopening of the costs issue on the basis of written submissions.

9 The implication in the paragraph that I have read was that Mr Preece had said that the claimant's costs were £450,000. But that is not a fair reading of his press statement, let alone of what his solicitors pointed out in the letter from which I have taken the statement, that it was intended to refer to both sides' appeal costs and also to two other judicial review proceedings brought by the claimant against Plymouth.

10 On 10th March 2006 the court notified the claimant's solicitors as follows:

“An application has been made by the Respondent, Plymouth City Council to re-open the question of costs.

The Judge has granted the request and has directed that written submissions should be filed with the Court within 7 days from today, i.e. 17th March 2006 so that the question of costs can be considered by the bench.

Whilst writing, may I also ask that you indicate to the Court whether it is preferable that the matter be brought back before the Court at a hearing or whether a written judgment would suffice. Of particular note should be the fact that the order for costs is being amended under the slip rule, which allows 28 days for amendments.”


11 That letter was doubly erroneous. First of all, the claimants should have been invited, before a decision was made as to whether or not it was proper to reopen the question, for their views upon that issue. Secondly, the reference to the slip rule was clearly erroneous. It played no part and could play no part in any decision to reopen the decision on costs. As it turns out, neither of those errors in the letter are material.

12 On 16th March the claimant's solicitors provided an estimate and breakdown of the claimant's costs in the sum of £285,000 approximately. Skeleton submissions were exchanged.

13 On 22nd March the court sent out a sealed order. This too was both mistaken on its face and it was mistaken to send it out. It was mistaken on its face because it bore the seal date of 22nd May 2006. It recorded that the appeal had been allowed and the order made that the respondent pay 60 per cent of the costs of the appellant. But in the light of what the court had already determined, namely to reopen the issue of costs, that order should clearly never have been sent out. The claimant's solicitors very properly pointed this out in their letter of 23rd March 2006. Because that letter gave rise to a probable misunderstanding subsequently, I will read it out:

“We refer to our telephone conversations this afternoon concerning the fact that due to an administrative error the Court Order was drawn after the Court had decided to consider the Respondents' application to re-open the order for costs. We have taken our Clients' instructions and are pleased to confirm that the Appellants will be taking no point on the fact that the order was drawn and are content for the Court to consider the Respondents' application as if the order had not been drawn up [following] the making of the order.”


14 This letter may have been misconstrued by Stanley Burnton J when he refused permission on the papers of the claimant's application to seek judicial review of the Crown Court's refusal to state a case. Stanley Burnton J appears to have treated the letter as a concession that the court not only had jurisdiction to reopen the issue, but should do so. No such concession was made. The claimant submitted clearly in skeleton arguments that the court should not reopen the issue, relying on Charlesworth v Relay Roads Ltd [2000] 1 WLR 230 , which was attached to its second written submission submitted on 17th March 2006.

15 There followed further misunderstandings of the Crown Court's creation. On 22nd March the Court Office confirmed that no one need attend the hearing on 24th March: see the claimant's solicitors' letter to the court confirming that, dated 22nd March.

16 On 24th March, unaware of that communication, the Recorder sought the parties' attendance. Only Mrs Gillbanks of Plymouth's Legal Department was able to attend. In the event, she did not play an adversarial role in the proceedings and no issue arises as a result of her attendance.

17 The court decided to vary its order to reduce the percentage of costs payable by Plymouth to the claimant to 20 per cent. Its reasoning on this second occasion was rather more extensive than on the first:

“In this matter judgement was given on 7th March, ordering that the respondent pay 60% of the appellant's costs in this case. The estimate given to the court at that time was that the appellant's costs were well in excess of £150,000. That was, as we will see later, a misleading picture that was painted. It was nobody's fault. …

The following day 8th and possibly 9th, newspaper reports which indicated costs nearly three times that figure, were in fact the costs involved in successfully appealing the council's decision. On 10th March following that, the city council requested that the matter of costs be reopened, simply because the figure was considerably more than that, that was indicated. There were really three things that the council said; firstly that awarding a percentage of that new figure would be unfair. Secondly that such a figure would be wholly disproportionate in terms that any Bradford and Booth considerations, and as we indicated on the earlier occasion, we have to consider firstly any financial prejudice to Mr [Preece] if costs are not ordered in his favour, and also on the other hand the need to encourage public authorities to make and stand by honest, reasonably, and apparently sound administrative decisions made in the public interest, without fear of being exposed to undue financial prejudice, if the decision is successfully challenged. The third point they made was that, had they known it was going to be costs in the range that was later indicated in newspaper reports, they would have asked for more time. …”


18 The court noted that on 15th and 16th March the claimant's solicitors had written to explain that the £450,000 was a misleading figure, and that the claimant's costs of the appeal would in truth be an estimated £285,000 and that there was no good reason to reopen the issue of costs.

19 The court went on to observe:

“Just pausing there for a moment, whilst saying that the respondent had a good idea about costs and what had been incurred, certainly on the information given to us, we see, we have already observed that we were on the wrong end of the information. We were given a misleading picture. I don't say that critically, but something that had we known about, we would have acted very differently. …

As we understand the position now, that no point is now taken on whether, in the light of what has since come to light since the judgment has been delivered, that we have jurisdiction to re visit the matter, we being referred to the authority of Charlesworth v Relay Roads , and we are in any event satisfied that good and proper reason exists for us to reconsider the matter in the light of that further information that we now have. Indeed, and I repeat this, in our view, the figures given at the conclusion of the trial were misleading, and whereas having settled on a proportion of costs to be paid by the respondent, the reality now, if the order were to stand, is that the costs which are now likely to, or may be, there is uncertainty about it, double if not triple the size indicated. The amount, which the council would be liable for, is in our judgment, significantly disproportionate to the issues on which it lost and is likely, and I touch on the authority to which I have already referred, Bradford v Booth , likely to be a considerable disincentive to act reasonably and in accordance with their public duty. There is in this case, in our judgment, a very real likelihood, if the order were to stand, of undue financial prejudice to the council, and we understand we have to balance this against the appellant not receiving a substantial part or all of his costs.

In short we welcome the opportunity to revisit this matter in the light of the new information we have. We remind ourselves of the guidance provided by the civil procedure rules and they have been touched on in the skeleton arguments and we remind ourselves what we must have regard to and in particular that the appellant has failed to prove in large measure the issues that have taken up most of the time in this trial. We accept of course that the burden of proving the negative was on the respondent in this case, but the all out assault by expensive experts on the methodology of the survey, was as the judgment shows, in a large measure unsuccessful. We look to see how best the overriding objective can be best served in this case by reference to the guidance provided by the rules, and on reconsideration of the arguments put before us, and the findings that we have made and reminded ourselves of … (break in recording) … the justice of the case, we considered limiting the order of contribution to the respondent cost to the discrete issue of the Mayflower evidence, but, in the light of the findings that we have made, and is set out in the judgment, the validity of the data from the public attitude survey, perhaps extended a little further than the Mayflower evidence, and taking all matters into account, we conclude that 20% is the fair and proper contribution that has to be made and there will therefore be an order to that extent and costs will be assessed in the way I directed on the last occasion.”


20 Three reasons for the revised order can be distilled from that extempore judgment: (1) the court was misled on 7th March as to the claimant's costs; (2) it would be disproportionate on Bradford principles to award 60 per cent of the larger sum; (3) the claimant had only “won” on one significant evidential issue.

21 The approach which the court should have adopted to the reopening of its order for costs is not in doubt. It was set out in the authority to which reference was made in the judgment, Charlesworth v Relay Roads Ltd [2000] 1 WLR 230 , in which Neuberger J observed at page 238G–H the following:

“… quite apart from, and over and above, those principles, because it is inherently contrary to the public interest and unfair on the other side that an unsuccessful party should be able to raise new points or call fresh evidence after a full and final judgment has been given against him, it would generally require an exceptional case before the court was prepared to accede to an application where the applicant could not satisfy the three requirements in Ladd v Marshall …”


22 That observation was made in relation to the circumstances in which a court could reopen its own judgment for the reasons stated before its judgment had been sealed, by which time of course the court would become functus officio and would lose the power to reopen, save under the slip rule.

23 Since the Crown Court's decision Jack J, in a reserved judgment in Malmesbury and others v Strutt & Parker [2007] EWHC 2199 (QB), having analysed the principles upon which a court may correct its judgment before it is sealed, has said the following:

“9. It is well-established by a number of recent cases as well as others of greater age that where a judgment has been delivered, either orally or by handing down, the judge may in appropriate circumstances alter it at any time prior to an order giving effect to the judgment. Once there is such an order the judge is functus officio and the only way forward for a dissatisfied party is to appeal. I have referred to ‘appropriate circumstances’. It has sometimes been said that the circumstances must be exceptional. More recently it has been suggested that it is better to state that strong reasons must exist before the jurisdiction will be exercised. The need for some stringent limitation is that the parties to litigation should ordinarily be able to treat a delivered judgment as final, and be free from the risk that a dissatisfied party may re-open his arguments before the judge. As a matter of policy it is also appropriate for the same reason that there should be a bar to the exercise of the jurisdiction, which bar takes the form of an order giving effect to the judgment, even if the technical reason for that bar is that the judge is functus officio.”

24 He cited observations of the Court of Appeal in Robinson v Fernsby [2003] EWCA Civ 1820 , at paragraph 94:

“Once a judgment has been handed down or given, there are obvious reasons why the court should hesitate long and hard before making a material alteration to it. These reasons have been rehearsed in the cases to which I have referred and I need not elaborate them further. The cases also acknowledge that there may very occasionally be circumstances in which a judge not only can, but should make a material alteration in the interests of justice. There may for instance be a palpable error in the judgment and an alteration would save the parties the expense of an appeal. On the other hand, reopening contentious matters or permitting one or more of the parties to add to their case or make a new case should rarely be allowed. Any attempt to do this is likely to receive summary rejection in most cases. It will only very rarely be appropriate for parties to attempt to do so. This necessarily means that the court would only be persuaded to do so in exceptional circumstances, but that expression by itself is no more than a relatively uninformative label. It is not profitable to debate what it means in isolation from the facts of a particular case.”

25 I accept and apply those observations. It is clear from them that the jurisdiction to reopen an issue such as costs should only be exercised either in exceptional circumstances or where there are strong grounds for doing so. The two expressions are in my view synonymous.

26 I turn therefore to examine the approach of the Crown Court on 24th March 2006. I do not discern in the Recorder's remarks any acknowledgement that the reopening of the costs issue should only occur in exceptional circumstances or where there were very strong grounds for so doing. Although he referred to Charlesworth v Relay Roads Ltd , immediately after he did so he observed simply that:

“… we are in any event satisfied that good and proper reason exists for us to reconsider the matter in the light of that further information that we now have.”


27 And:

“In short we welcome the opportunity to revisit this matter in the light of the new information we have.”


28 It seems to me that by those phrases, which are the only phrases by which the court directed itself as to the nature of its jurisdiction, it applied a substantially less stringent test than that which authority required it to apply.

29 The three reasons which I have distilled from its judgment which led it to reduce the proportion of costs payable from 60 to 20 per cent require to be analysed in this context. The third — that the claimant had only won on one evidential issue — was apparent and expressly taken into account by the court in its first ruling, and plainly was not new material. The second — that it would be disproportionate on Bradford principles to award 60 per cent of a much larger sum than that which the court had in mind — clearly depends upon the first issue, that the court felt that it had been misled as to the claimant's costs.

30 Mr Newman concedes, rightly in my view, that if the court had been misled by the claimant as to the likely amount of costs by an order of magnitude of two or three, then the court could treat that as an exceptional circumstance or strong ground and reopen the issue. But that was not the case. The claimant's solicitors gave an estimate of costs to Plymouth by a letter dated 14th February 2006, which stated:

“You will be aware from the fact that our Client has engaged Senior and Junior Counsel, sought expert evidence from MORI and carried out extensive work in relation to observations and critique of the TPI Report, that very significant costs have been incurred. As a rough estimate, our Client estimates that he has spent £150,000 on the case up to the start of trial.”

The letter then went on to explain elements of that figure, and concluded:

“There is now a further week's trial scheduled and the costs incurred in connection with the first week of trial are likely to be repeated, although Counsel's additional fees may be limited to further refreshers. …”


31 On no reasonable view could the claimant's solicitors be taken to be stating that costs would be of the order of £150,000, or even £150,000 plus a modest increase. They were saying, in the plainest of terms, that pre-hearing costs amounted to £150,000. No solicitor receiving such a letter could possibly have concluded that an 11-day hearing would not add very significantly to that estimate of costs.

32 At the hearing on 7th March Mr Findlay, for Plymouth, submitted in writing that:

“As to prejudice, the costs figures appear to be well over £150,000. Payment of such a figure would result in undue financial prejudice.”


33 During oral submissions Mr Findlay repeated that figure with these words:

“MR FINDLAY: … And your Honour, whilst I have asked for some indication of the figure, but I feel I can tell the Court this, as your Honour knows it is not an open figure, but it is a substantial figure indeed. I have put [it] in paragraph 5 [to which I have referred], perhaps I can just show my learned friend.

MR NEWMAN: It will be [well] over that figure!

MR FINDLAY: Yes, it will be well over £150,000. Well over £150,000, and that is exactly the sort of figure that would be an extremely large disincentive to encourage public authorities to make and stand by honest, reasonably and apparently sound decisions.”


34 Even if that were the only information available to Plymouth, which it was not, on no reasonable view could the court have concluded that the costs would be anything less than £200,000, indeed, most likely, significantly more. Plymouth were aware that that was not the base figure because of the letter to which I have already referred dated 14th February 2006. It was incumbent upon Plymouth's legal department to instruct Mr Findlay on matters such as costs if, as was inevitable, he was going to make submissions about them. They had that letter in their possession. It was up to them to make it plain to Mr Findlay that the £150,000 was but the pre-hearing costs. If the court was misled, then it was misled, in my view, as a result of Plymouth's failure to give adequate instructions to Mr Findlay.

35 But on any view, the difference between £200,000 plus and £285,000 is not capable of giving rise to exceptional circumstances or strong grounds for reopening a decision on costs. The difference between the two figures is simply not large enough. It was in any event not of the order of magnitude stated by the court, that is to say two or three times the original figure. If, as seems possible, the court took into account the press statement to indicate that the claimant's costs were going to be of the order of £450,000, then that was a mistaken view and a fact which it should not have taken into account in exercising its discretion, if it had any, as to the order that it made. In reality, what it did was to misinform itself as to the factual background upon which it based its decision to reopen the question of costs, and did so without reminding itself, and in terms directing itself, as to the exceptional circumstances in which such a jurisdiction should be exercised.

36 There was ultimately no proper basis upon which the court could have or should have reopened the issue of costs. I therefore quash the reopened order limiting the costs recoverable by the claimant to 20 per cent of its costs, leaving the original order that the claimant can recover 60 per cent of its costs to stand.

37 I do so following the realistic and helpful concession by Mr Findlay that, first, if this application for permission for judicial review should succeed I should go on to hear the matter in full, as I have done, and, secondly, that I should treat the challenge to the Crown Court's refusal to state a case as to the issue of costs as if this were a judicial review claim challenging the reopening of the costs decision. There are no procedural obstacles to the order that I have made.

38 MR NEWMAN: My Lord, I am happy to say that so far as any costs of these proceedings are concerned, that is one area upon which my learned friend and I have reached a measure of agreement. We would invite your Lordship to make no order as to costs either in relation to the case stated yesterday or in relation to the judicial review, the one effectively cancelling out the other.

39 MR JUSTICE MITTING: I was going to raise that as a possibility. I am delighted that it has occurred to both of you and you have reached that very sensible decision, which will avoid yet further expense in what has already been very costly litigation.

40 MR NEWMAN: Thank you.

41 MR FINDLAY: My Lord, as a matter of practice I feel I should ask for permission to appeal your Lordship's judgment. The issue on which I — no one from Plymouth is here and we obviously have to take instructions, but my Lord the issue is that your Lordship's interpretation of the Recorder's judgment and his application or non-application of the appropriate test in Charlesworth v Relay , putting it simply I suggest that a different interpretation would have been the correct one.

42 MR JUSTICE MITTING: I do not agree with that. If there is any arguable ground of appeal which has a realistic prospect of success, then that will have to be discerned by the Court of Appeal. I refuse your application.

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