Contrary to recent guidance from the Upper Tribunal, issued by former President McCloskey no less, an application to that tribunal for permission to appeal to the Court of Appeal against a costs order made in a judicial review should be subject to a “first appeals test”, not a “second appeals test”.

That was the Court of Appeal’s finding in Nwankwo & Anor v Secretary of State for the Home Department [2018] EWCA Civ 5 on the correct test for permission to appeal against a decision of the Upper Tribunal on costs. 

A “first appeals test” involves a first appeal against a decision of a lower court (such as the First-tier Tribunal). The requirement for permission is simply an arguable ground of appeal with realistic prospect of success. 

A “second appeals test” is a much more stringent test, engaged where an applicant has already had one appeal determined by an appellate court (such as the Upper Tribunal) and is requesting permission for a second appeal at a higher court (such as the Court of Appeal). The second appeals test requires the applicant to raise not just an arguable ground of appeal but also an important point of principle or practice, or another compelling reason for the appeal to be allowed to proceed.

The Upper Tribunal’s requirement to apply a second appeals test is derived from section 13(6) of the Tribunals, Courts and Enforcement Act 2007, read in conjunction with sections 13(7) and 11, and the Court of Appeal Order 2008 (SI 2008 No. 2834). Where the Upper Tribunal has been acting as an appellate court (hearing an appeal against a decision of the First-tier Tribunal), it must apply the second appeals test in all cases where permission to appeal against one of its decisions is sought.

In judicial review cases, the Upper Tribunal does not act as an appellate court. Rather, it is hearing the case at first instance. It is only where the tribunal has acted in this capacity that the less rigorous “first appeals test” is to be applied.

Delivering the leading judgment, Lord Justice Singh held that:

The second appeal test is restricted to applications falling within section 13(7), where the application is for permission to appeal from any decision of the UT when it has decided an appeal from the FTT under section 11. Unsurprisingly it is because there has already been one appeal to the UT that the second appeal test applies. In the present context, by way of contrast, the UT did not exercise its appellate jurisdiction at all. It was exercising an original jurisdiction, to consider a claim for judicial review. [paragraph 30]

Although the Secretary of State conceded that the correct test was indeed the first appeals test, she argued for “an elevated or robust approach to the permission threshold”. Singh LJ robustly rejected these submissions, highlighting that

it makes obvious sense that the same test must be applied when the UT initially considers an application for permission to appeal to this Court. That is the test to be found in Part 52 of the CPR. [43]

Declining the Secretary of State’s request for further guidance on the test for deciding permission to appeal against a cost order, he held that

sufficient guidance has already been given by this Court in the well-known case of R (M) v Croydon LBC [2012] EWCA Civ 595; [2012] 1 WLR 2607, in which this Court considered how applications for costs should be dealt with in judicial review proceedings. [46]

The Upper Tribunal’s guidance has not been struck down entirely. It still stands in relation to forms, time limits, substantive requirements for an application for permission to appeal in the Upper Tribunal, guidance for tribunal judges on how to treat deficient permission to appeal applications, and fees. But this is a significant clarification on the test that should be applied where an appeal against a cost order arising from a judicial review is made – at least in England and Wales.

The position is Scotland is different. This is because of an anomaly in the drafting of section 13(6A) of the Tribunals, Courts and Enforcement Act 2007, which applies to Scotland. In a decision issued by Lord Drummond-Young yesterday, it was held that due to this drafting anomaly (or, most likely, drafting error) the Upper Tribunal in Scotland is bound by law to apply a first appeals test in all applications for permission to appeal. 

This creates a significant difference between Scotland and the rest of the UK, making it theoretically easier for an application to the Upper Tribunal for permission to appeal to succeed in Scotland. More on this in a subsequent post.