From 25 March 2013, a new procedure for Protective Expenses Orders (PEOs) in environmental court cases.
You’ll know from previous posts on PEOs that, if granted, they regulate the liability for expenses of all or any of the parties to proceedings, the idea being that the proceedings will not be prohibitively expensive for the person seeking the PEO (i.e. where the applicant for the PEO could not reasonably proceed without a PEO).
If granted, a PEO will now limit the liability for expenses to £5,000 (or less on cause shown), but if the case is successful will also limit the expenses which can be claimed from the other party to £30,000 (or more on cause shown). An order can also exclude liability of any party for the expenses of any other party altogether and/or regulate parties’ liability to each other for expenses depending on the outcome of the proceedings.
Where the court is satisfied that the proceedings are prohibitively expensive for the PEO applicant, it must make a protective expenses order, but it can refuse to make an order if it considers the applicant has failed to demonstrate a sufficient interest in the subject matter of the proceedings, or where the proceedings have no real prospect of success.
Are the limits really that encouraging for challengers? They might offer some comfort, but unless the lawyers are working pro bono, will the cost of getting legal representation put challengers off even if their liability to pay the other sides’ costs can be capped? And what if the application for a PEO is unsuccessful? The applicant will have the added cost of the PEO procedure, as well as potential liability for uncapped costs, and of course a delay in proceedings. Would you still be keen to pursue a challenge if your potential liability in expenses to the party challenged was ‘only’ £5,000 or the expenses payable to you were ‘only’ £30,000?
On March 26, 2013