Introduction

The case Epuk Investments UK v Environmental Protection Agency (EPA) and Epuk Investments UK v Commission for Regulation of Utilities (CRU) ([2023] IEHC 138) was adjudicated in the High Court of Ireland on March 22, 2023. Epuk Investments Limited ("EPUKI"), the applicant, sought judicial review against the EPA and CRU, challenging specific decisions related to Industrial Emissions Licenses (IEL) and Capacity Auctions in the All-Island Single Electricity Market ("SEM"). The core issues revolved around the interpretation and application of Annual Run Hour Limits ("ARHL") and Best Available Techniques ("BAT") conclusions issued by the European Commission.

Following the dismissal of both judicial review claims, EPUKI pursued orders regarding the allocation of legal costs, invoking Section 50B of the Planning and Development Act 2000 ("PDA 2000") and arguing the public interest nature of the litigation. Alternatively, EPUKI suggested the application of Veolia Orders concerning the exclusion of certain pieces of evidence and contesting jurisdictional interpretations.

Summary of the Judgment

Justice David Holland dismissed both judicial review claims filed by EPUKI against the EPA and CRU. In the case against the EPA, the dismissal was based on the assertion that the email dated July 18, 2022, did not constitute a justiciable decision under Section 50B PDA 2000. Similarly, the claim against the CRU was dismissed due to the absence of a statutory basis for the ARHL De-Rating Decision, and the CRU's lack of jurisdiction in interpreting the Industrial Emissions Directive ("IED") and BAT Conclusions.

EPUKI's subsequent application for favorable cost orders was also denied. The court adhered to the general rule that "costs follow the event," where the successful parties (EPA and CRU) are entitled to recover legal costs from the unsuccessful party (EPUKI). The judge declined to exercise discretion under Section 50B or to grant Veolia Orders, concluding that EPUKI's actions were predominantly commercial rather than purely public interest-driven.

Analysis

Precedents Cited

The judgment extensively referenced key legal precedents to substantiate its reasoning:

• Godsil v. Ireland and the Attorney General [2015] IESC 103: Established the principle that costs generally follow the event in civil proceedings.
• Dunne v. Minister for the Environment [2008] 2 I.R. 755: Emphasized that "costs follow the event" has an equitable basis.
• Heather Hill Management Company CLG v An Bord Pleanála and others [2022] IESC 43: Clarified the scope of Section 50B PDA 2000, affirming that any challenge to a decision made under specified directives falls within its protection.
• Ryanair DAC v An Taoiseach [2020] IEHC 673: Discussed factors influencing the discretionary departure from the default cost rule, especially in public interest cases.
• Chubb European Group SE v. Health Insurance Authority [2020] IECA 183: Illustrated the high threshold for applying Section 50B(3) based on conduct.
• O'Brien v Clerk of Dáil Eireann [2017] IEHC 377: Highlighted the necessity for legal issues to possess sufficient novelty and public importance to warrant departure from standard cost rules.

Legal Reasoning

The court's legal reasoning hinged on two primary aspects: the applicability of Section 50B PDA 2000 and the nature of the litigation as public or private interest.

• Section 50B PDA 2000:
  • The statute generally protects parties from bearing the opponent's costs, but only applies when challenging decisions made under specific statutory provisions.
  • In this case, the EPA’s email was deemed a consultation, not a binding decision under relevant directives, thus falling outside Section 50B's ambit.
  • Similarly, the CRU's De-Rating Decision lacked a statutory foundation under the IED, rendering Section 50B inapplicable.
• Public Interest Litigation:
  • The court assessed whether EPUKI's litigation was genuinely in the public interest or primarily driven by commercial motives.
  • It concluded that EPUKI's actions were predominantly commercial, aimed at avoiding financial disadvantages due to ARHL De-Rating, rather than purely public interest.
  • Thus, the threshold for departing from the default cost rule was not met, as the litigation did not sufficiently align with the exceptional public interest criteria delineated in precedents like Ryanair and O'Brien.

Impact

This judgment reinforces the strict application of cost rules in judicial review proceedings, especially distinguishing between public interest litigation and commercial interests. It underscores that merely invoking public interest is insufficient to alter standard cost allocations unless the litigation exhibits exceptional public significance and lacks predominant private motives.

Future litigants must demonstrate a clear public interest orientation and meet high thresholds of novelty and general importance to qualify for favorable cost orders or departures from the default "costs follow the event" rule. Commercial entities pursuing judicial reviews must be prepared to bear their own costs unless exceptional circumstances apply.

Complex Concepts Simplified

Section 50B PDA 2000

Section 50B of the Planning and Development Act 2000 provides cost protection in specific judicial review proceedings. It ensures that parties challenging certain decisions do not have to bear the opponent's legal costs, promoting access to justice in matters of public regulation and directives.

Veolia Orders

Veolia Orders allow courts to allocate costs more precisely based on the success or failure regarding specific issues within a case. This can involve partial cost awards depending on which points were won or lost, especially in multi-issue litigation.

Public Interest Litigation

Public interest litigation refers to legal actions initiated to protect or enforce rights that affect the community or the public at large, rather than solely individual interests. Such cases can influence legislation, public policies, or broader societal concerns.

Costs Follow the Event

This legal principle dictates that the losing party in litigation must pay the legal costs of the winning party. It serves as a deterrent against frivolous lawsuits and ensures that the successful party is not financially burdened by subsequent legal expenses.

Conclusion

The High Court's decision in Epuk Investments UK v EPA & CRU reaffirms the judiciary's adherence to established cost principles in judicial review cases. By declining to apply Section 50B PDA 2000 and rejecting Veolia Orders, the court emphasized the necessity for litigants to demonstrate unequivocal public interest motives to benefit from cost protections. This judgment serves as a precedent, guiding future litigants in navigating cost allocations, especially distinguishing between public and commercial interests in judicial review proceedings. It underscores the judiciary's commitment to equitable cost distribution, ensuring that only cases with genuine public significance can deviate from the default rule that costs follow the event.