The Supreme Court has upheld an order requiring Usk District Residents Association Limited to provide security for Greenstar Recycling Holdings Limited’s costs of opposing the association’s application for leave to seek judicial review of a waste licence. The Court did not decide whether the licence was valid or whether the association should receive leave to challenge it.
The Environmental Protection Agency granted Greenstar a waste licence on 8 June 2004 for a non-hazardous waste disposal facility. Usk began judicial review proceedings in August 2004, seeking to quash the licence and challenge some of its conditions. The case was still at the leave stage when Greenstar applied for security for costs under the Companies Act 1963.
The High Court found that Usk was likely to be unable to pay Greenstar’s costs if Greenstar succeeded, and that Greenstar had a prima facie defence. It ordered security limited at that point to costs associated with the leave application, setting the amount at the lower figure proposed by Usk’s cost accountants. Usk appealed, arguing that Greenstar had not shown a prima facie defence to three grounds of its challenge.
In a judgment delivered on 13 January 2006, Mr Justice Clarke said the security application required consideration of whether Greenstar had a prima facie defence to the proceedings as a whole, even though the security ordered was then limited to the leave application’s costs. The Court could consider affidavits filed in the judicial review proceedings, as well as material in the application for security.
The three grounds concerned whether the environmental information was out of date because quarrying allegedly continued after the environmental impact statement was submitted; whether the licence met the “best available technology not entailing excessive costs” requirement, including in relation to buffer zones; and whether the licensed activity was materially different from the activity applied for. The Court found Greenstar had shown an arguable defence to each. It stressed that it was not deciding the strength of the underlying judicial review, which remained for the High Court.
The Supreme Court therefore dismissed the substantive appeal and upheld the security order. Separately, it varied the High Court costs order: the costs of the security application in the High Court were reserved to the judge who would handle the leave application. The appeal did not challenge the decision to limit security at that stage to costs associated with the leave hearing.