Judgment was handed down on 4 December 2020 by the Supreme Court in the case of R (on the application of Gourlay) v Parole Board. It was held that a body which takes a decision in a judicial or quasi-judicial capacity, and then declines to defend it when it is challenged in court proceedings, will not ordinarily face an order for costs.
 UKSC 51
 EWCA Civ 1003
 EWHC 4763 (Admin)
In 2014 Mr Gourlay, a life prisoner, challenged a decision of the Parole Board not to recommend a transfer to open conditions. He succeeded at a hearing before the Administrative Court at which the Board, according to its usual practice as set out in its Litigation Strategy, remained neutral and did not appear. He applied for an order that the Board should pay his costs. The Board resisted the application, arguing that the usual rule, derived from R (Davies) v Birmingham Deputy Coroner  1 WLR 2739, should apply, namely that where the Board did not actively participate in a challenge to one of its decisions, it would not be held liable for costs.
Before the Administrative Court, Mr Gourlay argued that:
Both the Administrative Court (King J) and the Court of Appeal dismissed Mr Gourlay’s application for costs. Hickinbottom LJ (with whom Gloster and David Richards LJJ agreed) found that there was no doubt as to the independence and impartiality of the Board, and that the Board was clearly acting as a court or tribunal for the purposes of Davies. A party did not contest a claim simply because it did not concede it.
Decision of the Supreme Court
The Supreme Court considered, first, whether Davies continues to represent the approach that should be adopted to costs orders against courts or tribunals, and secondly, if so, whether the Board should be treated as a court or tribunal for that purpose.
Lord Reed, delivering the sole judgment, said that the Supreme Court will be slow to intervene in matters of practice, including guidance given by the Court of Appeal as to the practice to be followed by lower courts in relation to an award of costs. The responsibility for monitoring and controlling developments in practice generally lies with the Court of Appeal, which hears a far larger number of cases. The Supreme Court can, and previously has, intervened where there has been an error of law. But bearing in mind the discretionary nature of decisions on costs, and the rarity of their raising any question of law of general public importance, appeals solely on costs will ordinarily be inappropriate (§36).
The Court of Appeal is not bound by its own decisions on practice: it must be able to keep under review its decisions laying down principles of practice as to how lower courts should exercise their discretion in relation to costs. There is always a residual discretion as to costs (§37-38).
Nevertheless, a decision on practice should only be reviewed where there is sufficient reason to do so, such as where there has been a material change in circumstances or a previous case was decided per incuriam. This avoids repeated arguments about the principles to be adopted in costs cases (§40).
The Supreme Court confirmed that Davies still represents good law. More recent case law did not represent a new approach. Neither were the principles in Davies inconsistent with civil procedure rules:
“…there is nothing in CPR rule 44.2 which is inconsistent with the approach which was described in Davies and followed in the present case. A body which takes a decision in a judicial or quasi-judicial capacity, and then declines to defend it when it is challenged in court proceedings, choosing instead to maintain its impartiality and to let the reasons which it gave for its decision speak for themselves, acts in accordance with principles of judicial independence and impartiality which have long been recognised both in English law and at an international level: see, for example, the United Nations Commentary on the Bangalore Principles of Judicial Conduct, paras 72 and 74” (Lord Reed at §46).
The fact that a party is in receipt of legal aid cannot affect the principles on which the discretion to award costs is normally exercised (§47-48).
The Supreme Court agreed with the decisions below: the Board had taken the decision under challenge while acting in a judicial or quasi-judicial capacity, and had not made itself an active party to the litigation. The question of whether the Board should be treated as a court or tribunal is itself a question of practice, rather than a question of law. Additionally, the Board’s failure to respond to a letter before action did not amount to improper or unreasonable behaviour which would justify an award of costs against it (§44).
Case summary written by pupil Daisy van-den Berg.
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