The Tribune

• Activists succeed in slashing costs award by 60%

• Gov’ts $100k upheld despite ‘strikingly high’ costs

• ‘Stifled’: Court says no merit to ‘troubling trend’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Activists yesterday won a partial Privy Council victory in their battle to prevent public interest legal challenges from being priced out of the Bahamian justice system.

Responsible Development for Abaco (RDA) succeeded in persuading the highest court in the Bahamian judicial system to overturn previous orders that it must pay $150,000 to cover the legal costs likely to be incurred by the Abaco Club’s developer, Southworth Development, in opposing their Judicial Review challenge to its Little Harbour expansion plans.

However, the Privy Council upheld previous Supreme Court and Court of Appeal rulings that RDA must come up with a $100,000 “security” to cover the Government’s legal costs in defending the action. It found the non-profit had failed to provide sufficient evidence of its inability to raise the necessary funds, and therefore was unable to prove “its claim would be stifled”.

And, perhaps more significantly, the five UK law lords ruled there was no merit to RDA’s claim that the Government and developers are increasingly exploiting the Bahamian legal system to price environmental activists and other public interest litigants out of bringing claims by obtaining so-called “security for costs” orders.

Yet they also described the Government’s $304,600 costs estimate as “striking”, adding that the figure seemed “very high for what was a very simple Judicial Review claim with minimal evidence”. The verdict, in effect, allows both sides to claim their respective victories, with RDA’s total “security for costs” burden having been slashed by 60 percent - from $250,000 to $100,000.

The Judicial Review challenge has its roots in the Abaco Club’s plan to construct a 44-slip marina, along with a supplies shop, private restaurant, 6,000 square foot covered car park, generator, desalination plant and waste treatment facility. The proposed development was to measure 320 feet across the outside piers, 210 feet between the two parallel main piers, and will extend 270 feet into Little Harbour, with the intent for it to accommodate boats up to 60 feet.

However, RDA argued that the project will completely change the environment and character of Little Harbour, a 50-home community that runs entirely off solar power. Besides its environmental concerns, RDA claimed that the relevant government agencies did not hold proper consultation with the Little Harbour community before issuing the grants, permits and approvals required by the Abaco Club for the project’s construction.

The group is also alleging that the Government agencies have withheld information, thereby depriving it of its statutory rights and/or legitimate expectations to contribute to any consultation process. This was contested by the Government, and RDA was ordered by Supreme Court Justice, Petra Hanna-Weekes, to pay the Abaco Club’s developer $150,000, and the Government a further $100,000, as “security for costs” in a November 2017 ruling.

This was upheld by the Court of Appeal. The Privy Council, in its verdict yesterday, confirmed the case had attracted international attention as it allowed the Open Society Justice Initiative and the Environmental Law Alliance Worldwide to intervene through written submissions.

“They are both US-based, international, non-profit organisations advocating on various issues including human rights and environmental justice,” the Privy Council added. “Those submissions were put forward ‘to offer broader insight into the right to access justice and the need to remove financial barriers to public interest litigants’.

“Various decisions from Caribbean and Commonwealth countries were cited which were said to show ‘a growing trend towards reducing financial barriers for public interest litigants’.” RDA, which was incorporated in 2009 as a non-profit group, was said to have three directors - Clint Kemp, its president; David Pitcairn, vice-president; and Matthew McCoy as secretary.

While its shares were said to be held on trust for 75 landowners and residents of The Bahamas, the Privy Council said no evidence was provided by RDA as to who they were, their financial means and whether they might be willing to fund the action over the Little Harbour project. It also noted that the Abaco Club’s developer applied late to be “joined” as a respondent to the Judicial Review action, which allowed it to apply for “security for costs” separate from the Government.

In response to the Government and developer applications, Crispin Hall, an attorney with Callenders & Co, RDA’s Bahamian law firm, denied in legal filings that “RDA would be unable to satisfy a costs order made against it at the end of proceedings, and positively asserted that it would be able to do so. In support of this he pointed out that by the date of filing its application for Judicial Review, RDA had already raised $35,000 to assist with costs”.

“In the Board’s view, on the available evidence, the Court of Appeal was both entitled and correct to find that RDA’s claim would not be stifled,” the Privy Council ruled. “First, as set out above, Mr Hall’s evidence on behalf of RDA positively asserted that it could obtain the funds necessary to meet any costs order made against it.

“It is difficult to reconcile this with the contention that RDA’s claim would be stifled if an order for security for costs was made. Indeed, RDA did not assert in its evidence that its claim would be stifled, only that the Government respondents and the developers hoped that it would be.”

The judgment continued: “Secondly, and in any event, if RDA wished to avoid an order for security for costs being made against it, then as explained above the burden was on it to show on the balance of probabilities, and with full candour, that it had no realistic prospect of raising funds from its supporters to proceed and that its claim would therefore be stifled.

“Although it appeared that RDA’s supporters included local residents and others who had an interest to oppose the development, and who might be able to put RDA in funds to provide security for costs so as to enable it to proceed with the claim, RDA provided no information about them, their interest in the proceedings and their means, such as could support a conclusion that the claim would be stifled.

“Therefore, RDA failed to discharge the burden on it of showing that its claim would be stifled.” The Privy Council also dealt with assertions by RDA and its lead Bahamian attorney, Fred Smith KC, that the previous Court of Appeal decision “reflects a troubling trend of Bahamian case law whereby important public interest environmental cases have been stifled through public bodies and developers (often in tandem) obtaining orders for security for costs so as to prevent the ultimate trial of such cases”.

Rejecting this, the Bahamian legal system’s highest court retorted: “The Board is satisfied that the authorities do not bear out RDA’s complaint. In each case, the local courts properly sought to apply the relevant principles on the stifling of claims in the light of the evidence adduced before them.

“The mere fact that, in some cases, after an order for security for costs was made, a claim was not pursued does not show that the courts failed to apply the proper approach. A party might have various reasons for deciding not to proceed with a claim, including simply that it does not wish to run the risk of an adverse costs order even though it could afford to pay it.”

The Privy Council, though, did find in RDA’s favour over the $150,000 “security of costs” award to the Abaco Club’s developer. It ruled that imposing a second set of costs “risks deterring the claimant from proceeding with its claim, and hence is an impediment to gaining access to court”, while also finding that there was no issue relevant to the developer that would not be covered by the Government.

The five law lords added that the Abaco Club and its owner were in effect “seeking a pre-emptive insurance policy” against having to defend their interests at a later date, should RDA’s challenge make progress. They wrote: “Clearly it would be premature to do so now, but the developers are essentially seeking security from RDA for the costs of protecting their position should it prove necessary to do so.” As a result, the previous $150,000 order was overturned.

Turning to the Government’s $304,600 costs bill, the Privy Council said: “The Board wishes to comment on another feature of the case which is striking, albeit in the event it was not the subject of any ground of appeal at this level. The draft bill of costs adduced by the Government respondents appeared formulaic.

“For example, it did not explain what costs had already been incurred and what costs were projected to be incurred. The figures for the individual items of work and the overall figure appeared very high for what was a very simple Judicial Review claim with minimal evidence.”