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Third-party supporters of JRs to be identified if they contribute more than £1,500

Cut-off point: contributors above £1,500 may have element of control [1]

Cut-off point: contributors above £1,500 may have element of control

Anyone who contributes at least £1,500 to back a judicial review (JR) will have their identity made known to the court as they may have some element of control over the litigation, the government has proposed.

However, plans for a secondary threshold of 5% of the estimated costs have been dropped for being impractical.

The Ministry of Justice (MoJ) last week published a consultation on the detail of the controversial reforms to judicial review funding contained in the Criminal Justice & Courts Act 2015, which aim to introduce greater transparency in how JRs are funded, and to limit the potential for third-party funders to avoid their “appropriate liability” for costs.

However, it emphasised that the reforms neither affected the law on when costs should be awarded against a third party, nor created any requirement to secure a particular level of funding before permission can be granted.

The consultation proposed that, before permission could be granted, a claimant would have to complete a declaration of financial resources, verified by a statement of truth. This would not be shared with the defendant or interested parties, or made publicly available.

If the claimant has the funds to cover potential liabilities, or has applied for or been granted legal aid, then they would not have to provide any further information.

If otherwise funded, the claimant would have to state the name and address of each contributor to the potential costs – subject to the threshold – and the size of their contribution. If a corporate body, it would have to provide the names, addresses and interest in the claimant of its members.

Where required, it would be for the claimant to estimate the likely cost of the JR, but the current intention is that they would not have to provide this figure or justify it.

As an alternative, the MoJ sought views on whether to require the claimant to provide some analysis of the likely cost of the claim, allowing the court to consider whether the declaration was made correctly.

The consultation also proposed a duty to update the court if the claimant’s financial circumstances change during the course of the case.

It said: “The government’s view is that a relatively simply declaration will strike an appropriate balance between providing the court with adequate information without placing too heavy a burden on a claimant.”

As indicated during the Act’s passage through Parliament, the proposed threshold for disclosing the identities of third-party contributors was £1,500. The MoJ said it was influenced by figures published by the Public Law Project in 2007, Guildhall Chambers in 2012 and solicitors Leigh Day in 2013, even though it acknowledged that this data was “not particularly substantial or quality assured”.

The £1,500 threshold would “achieve the required balance between the court having the information it requires, without having a chilling effect on small contributions made without an expectation of control, or inundating the court with unnecessary information”, the MoJ argued.

It added: “In the government’s view, a threshold of £1,500 will capture contributions which may be indicative of a degree of third-party control of a claim particularly in lower-cost claims such as those which do not get beyond the permission stage.”

The 5% test would have linked the threshold to the costs of the claim, but the MoJ said “it appears impracticable” given that, as proposed, claimants would not have to provide a statement of the likely costs of the claim, and even if they did the figure may change over time.

The consultation also sought views on the implementation of provisions to codify the protective costs order regime for the purposes of JR as costs-capping orders. Environmental cases covered by the Aarhus Convention would be exempt.

It suggested that the information the court would require to make an order would have to be more extensive than for an application for permission because it would be for a different purpose.

The applicant would be required to outline their financial position, such as a breakdown of their significant assets and liabilities, their income and significant regular expenditure. The application would be served on the defendant and interested parties so they could decide whether to oppose or make representations on it.

The consultation can be found here [2]. It is open until 15 September.