Litigation generally costs money. This may be the case in administrative law appeal proceedings, among other things. But are the costs incurred eligible for reimbursement? And can you go to court with the sole purpose of obtaining reimbursement of legal costs?

Legal costs

In administrative law, legal proceedings are often initiated because someone disagrees with the content of a government decision. That person then has an interest in the substantive (re)assessment of a decision in an objection procedure before the administrative body. If someone disagrees with the decision made in response to an objection procedure, they can continue the proceedings in a (higher) appeal procedure before the administrative court.

Reimbursement of legal costs can be part of the decision made in response to an objection procedure. Reasonable costs incurred for, for example, professional legal assistance, the engagement of experts or witnesses may be eligible for reimbursement. Among other things, it is relevant whether the contested decision is revoked as a result of the objection procedure. This reimbursement usually does not cover all costs, but is a contribution towards them.

Litigating with the sole aim of obtaining legal costs

It sometimes happens that someone litigates solely because no legal costs have been awarded, without there being any substantive objections remaining to the decision taken on the objection. In such cases, litigation is pursued solely for financial reasons.

Until recently, this was possible, but three supreme administrative courts have recently ruled that an exclusively financial interest is, in certain cases, insufficient reason to continue proceedings regarding the legal costs incurred in the objection procedure.

This ruling can be found in the judgments of the Central Appeals Tribunal of 2 April 2024 (ECLI:NL:CRVB:2024:635 and ECLI:NL:CRVB:2024:636), the Trade and Industry Appeals Tribunal of 4 June 2024 (ECLI:NL:CBB:2024:378) and the Administrative Law Division of the Council of State of 5 June 2024 (ECLI:NL:RVS:2024:2323).

In short, each of the cases mentioned concerned a decision taken following an objection procedure in which there was no reason to revoke the original, contested decision and no legal costs were reimbursed. The administrative court only considered the lack of reimbursement of the legal costs incurred in the objection procedure.

These highest administrative courts are of the opinion that continuing proceedings with the sole aim of obtaining reimbursement of the legal costs incurred in the objection procedure is undesirable in these cases. In such proceedings, a judge assesses the substance of the objection to determine whether the decision taken was justified. This is relevant to the question of whether the legal costs incurred in the objection procedure should be reimbursed. At the same time, this substantive assessment serves no purpose because there are apparently no longer any substantive objections to the decision. This leads to an inefficient use of the scarce capacity within administrative justice.

The conclusion is that it is no longer possible to continue proceedings on the absence of legal costs reimbursement if the objection procedure has not led to a revocation of the contested decision. If an appeal is still lodged with the administrative court with the sole purpose of obtaining reimbursement of the legal costs incurred in the objection procedure, the appeal will be declared inadmissible due to the lack of legal interest in a substantive assessment of the dispute.

If the objection procedure has led to the contested decision being revoked, but the requested legal costs have not been awarded, proceedings may be brought or continued solely on the basis of the absence of legal costs. This also applies if the amount of legal costs awarded in the objection is in dispute. The reason for this is that, in principle, the judicial assessment in such cases is limited to the decision on the legal costs as such and there is no need for a substantive review of the decision on the objection. This is therefore a difference from the case described above, in which the objection procedure did not lead to the contested decision being revoked.

More information

For more information about this draft or other (procedural) issues, please contact Victoria Rozek (v.rozek@paulussen.nl) or one of the other specialists in the Government and Non-Profit team. They can be reached by telephone on +31 (0)43 321 6640. Appointments can be made both on location and at our offices in Maastricht and Heerlen.

Nieuws Overzicht