Moazzam Begg (Claimant/Appellant) v HM Treasury
| Jurisdiction | England & Wales |
| Judge | Mr Justice Cranston |
| Judgment Date | 29 June 2015 |
| Neutral Citation | [2015] EWHC 1851 (Admin) |
| Docket Number | Case No: PTA/7/2014 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 29 June 2015 |
[2015] EWHC 1851 (Admin)
The Honourable Mr Justice Cranston
Case No: PTA/7/2014
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr. Dan Squires (instructed by Birnberg Peirce & Partners) for the Appellant
Mr. Tim Eicke QC and Mr. Richard O'Brien (instructed by the Government Legal Department) for the Respondent
Hearing dates: 19/05/2015
Introduction
This is an application for a protective costs order ("PCO") by Moazzam Begg ("the appellant") whose designation under the Terrorist Asset-Freezing etc. Act 2010 ("the 2010 Act" or "TAFA") has been revoked but who seeks to have the designation declared void from the outset. He does not qualify for legal aid but (he says) his assets are modest and he could not pay HM Treasury's costs should his claim fail. He contends that he has a strong case on the material known to him to have the designation quashed from the outset. That will clear his name and remove the practical consequences for him of having been designated, one of which is a difficulty to access financial services. However, there is material which it is not in the public interest to disclose, commonly referred to as "closed material". Without costs protection, he argues, he cannot pursue this case because on this closed material, which he will never see, his claim may prove to be ill-founded.
The background
The background, in brief, is this. In February 2014, the appellant was arrested by West Midlands Counter Terrorism Command and charged with seven offences under section 8(1) of the Terrorism Act 2006 and sections 17 and 57(1) of the Terrorism Act 2000. He was remanded in prison. The appellant denied that he was ever involved in terrorism. However, he accepted that he had been in Syria and had been involved between November 2012 and April 2013 in providing basic fitness training to "some of those individuals who might later become involved in resistance to an overwhelming military onslaught". He also accepted having had contact with named individuals and having endeavoured to provide a specific item to one of those individuals. In anticipation of the prosecution the Crown Prosecution Service ("the CPS") disclosed in the ordinary way material which fleshed out the details of the allegations against him.
On 14 March 2014 HM Treasury designated the appellant under section 2 of the 2010 Act for the same reasons given in the criminal allegations. That section reads as follows:
"2. Treasury's power to make final designation
(1) The Treasury may make a final designation of a person for the purposes of this Part if –
(a) they reasonably believe –
(i) that the person is or has been involved in terrorist activity…and
(b) they consider that it is necessary for purposes connected with protecting members of the public from terrorism that financial restrictions should be applied in relation to the person.
…
(4) In this section…the reference in subsection (1)(b) above to financial restrictions includes a reference to restrictions relating to economic resources."
Section 11 then makes provision to freeze the funds and economic resources of designated persons and prohibits anyone (including designated persons themselves) from dealing with those funds. Sections 12–15 prohibit making available funds or economic resources to designated persons. The drastic consequences of designation were described in Ahmed v. HM Treasury [2010] UKSC5; [2010] 2 AC 534.
Some six months later, on 1 October 2014, the CPS stated that it would no longer proceed with the prosecution. It offered no evidence in relation to the charges brought, and the appellant was formally acquitted. An Assistant Chief Constable of the West Midlands police told the press on the steps of the Central Criminal Court that the appellant was "innocent". In its statement the CPS said that, at the time the charges were authorised "there was sufficient evidence available to provide a realistic prospect of a conviction and that it was in the public interest to prosecute" but that, in light of further material which had become available "there is no longer a realistic prospect of conviction". The appellant was released from prison where he had been since his arrest.
On 2 October 2014, the appellant's solicitors wrote to HM Treasury that "the designation… should be quashed ab initio". The letter said that the designation had been made unlawfully as the criteria for designation (that HM Treasury had a reasonable belief that one of the criteria set out in section 2(1) TAFA was met) had not been satisfied at the time the decision to designate was taken. On 14 October 2014 the appellant's designation was revoked, but not quashed ab initio. The appellant appealed under section 26 of the 2010 Act.
On 17 December 2014 the appellant's bank wrote to him and indicated that it intended to close his bank account. The explanation provided was that the appellant fell outside the "risk appetite" of the bank. Subsequently other banks have refused to continue to provide him banking facilities. Although he currently has banking services, he fears he may lose them at any time. In correspondence HM Treasury has stated that this is a contractual matter between the appellant and the banks involved but has provided a letter for presentation to them stating that his designation has been revoked.
The appellant seeks a protective costs order in relation to his section 26 appeal that the designation should be quashed ab initio. The issue before the court will be whether HM Treasury had reasonable grounds for believing at the time the appellant was designated that he was or had been involved in terrorist activity and it was, at the time, necessary to impose financial restrictions on him. There were detailed submissions before me about how that task is to be undertaken, some in written submissions after the hearing. Reference was made, inter alia, to BM v. Secretary of State for the Home Department [2011] EWCA Civ 366, [9], [39]. It is now common ground that the court will determine the issue by assessing the evidence before HM Treasury at the time of the designation, and also any evidence which has subsequently come to light showing that the designation was not necessary in terms of section 2(1)(b) of the 2010 Act.
Protective costs orders
Under section 51 of the Senior Courts Act 1981, the High Court has discretion as to making orders for costs in civil proceedings, subject to statutory provisions and the rules of court. The overriding objective of the Civil Procedure Rules ("CPR") is to enable the court to deal with cases justly and at proportionate cost, and dealing with a case justly includes ensuring that the parties are on an equal footing and that it is dealt with fairly: rr.1.1 (1), 1.2 (a), (d). The overriding objective enters when the court exercises its power under the rules, in particular to make orders to manage a case, which includes orders as to costs: rr.1.2, 3.1 (2)(m). It is common ground that the Senior Courts Act 1981 and the CPR as modified (but not in relation to the rules just mentioned), apply to appeals under section 26 of the 2010 Act.
A jurisdiction to make a PCO under section 51 was first identified in R v. Lord Chancellor ex p. Child Poverty Action Group [1999] 1 WLR 347. Dyson J identified the type of case where a PCO might be made as a public law challenge raising issues of general importance, where the applicant has no private interest in the outcome of the case: at 353 G-H. He added that the discretion to make a PCO even in cases involving public interest challenges should be exercised only in the most exceptional circumstances: 355F.
The leading authority on PCOs is R (Corner House Research) v. Secretary of State for Trade and Industry [2005] EWCA Civ 192; [2005] 1 WLR 2600, where the Court of Appeal endorsed the principle that the jurisdiction to make a PCO should be exercised only in the most exceptional circumstances (at [72]), and formulated guidelines to identify the circumstances in which a PCO should be made:
"[74]… (1) A protective costs order may be made at any stage of the proceedings, on such conditions as the court thinks fit, provided that the court is satisfied that: (i) the issues raised are of general public importance; (ii) the public interest requires that those issues should be resolved; (iii) the applicant has no private interest in the outcome of the case; (iv) having regard to the financial resources of the applicant and the respondent(s) and to the amount of costs that are likely to be involved it is fair and just to make the order; and (v) if the order is not made the applicant will probably discontinue the proceedings and will be acting reasonably in doing so.
(2) If those acting for the applicant are doing so pro bono this will be likely to enhance the merits of the application for a PCO.
(3) It is for the court, in its discretion, to decide whether it is fair and just to make the order in the light of the considerations set out above."
Subsequently, in R (Compton) v. Wiltshire Primary Care Trust [2008] EWCA Civ 749; [2009] 1 WLR 1436, Waller LJ stated that the Corner House criteria are not to be read as a statutory provision or to be read in an over-restrictive way: [23]. As to the third requirement in paragraph 74, the applicant's lack of private interest in the outcome, Waller LJ endorsed the remarks of Lloyd Jones J at paragraph 19 of R (Bullmore) v. West Hertfordshire Hospitals NHS Trust [2007] EWHC 1350...
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