Five Labour members have been ordered to pay £30,000 in legal costs to the party after the court of appeal overturned a ruling that they should be allowed to vote in this summer's leadership election.
Around 130,000 members had been blocked from voting in the leadership election by Labour's national executive committee (NEC) because they joined after 12 January, in an attempt by the party's top organisation to stop entryism.
In protest, a group of disenfranchised Labour members crowdfunded a legal case against the decision, with a judge finding in their favour on Monday. This effectively allowed all the 130,000 affected members a vote, leaving the Labour party facing an enormous bill for refunding individuals who had paid £25 to become a registered supporter.
But Labour HQ decided to appeal the decision – against the wishes of Labour leader Jeremy Corbyn – and on Friday the court of appeal found in the party's favour and overturned the original judgment.
The decision is expected to benefit challenger Owen Smith, since many of the new members were thought to have signed up in support of Corbyn.
The appeal court judges concluded that Labour's NEC could ultimately decide who was allowed to vote in the party's internal election, despite the party's website having stated that members would be given a vote when they signed up.
The judges concluded: "A member's entitlement to vote in a leadership election is not a product of him or her simply being a member, but is the result of him or her being a member who satisfies the precise eligibility criteria defined by the NEC and any freeze date provisions set by the NEC in the timetable for the election."
With the Labour party facing substantial legal bills as a result of the case, the judges ordered the five Labour members to pay £30,000 in legal costs within 28 days and refused them leave to appeal to the supreme court.
However, lawyers for the five members held out hope that there was a final route to appeal the decision directly to the supreme court.
The ruling is a sign of the administrative chaos enveloping the Labour leadership contest between Corbyn and Smith, which has already resulted in multiple court cases.
If the appeal ruling stands then members who joined after 12 January will only be allowed to vote if they also paid £25 to become a registered supporter.
Following the latest ruling, Corbyn's team immediately issued a statement condemning some of the decisions made by staff at his own party headquarters: "We think that this is the wrong decision – both legally and democratically. The court's ruling disenfranchises nearly 130,000 Labour members, who joined the party since January and were explicitly told that they would have a vote in any leadership election."
His team went on to attack "the Labour Party HQ’s lawyers" who "invoked an obscure clause in the Labour Party rules" and adopted a “make it up as you go along” attitude.
They concluded: "We do not think that making it up as you go along is a reasonable way to conduct democracy in our party."
Owen Smith said he would get on with fighting the campaign, saying: “I had welcomed the prospect of 125,000 additional members being given the opportunity to vote in this vitally important leadership election.
"The decision of the appeal court today doesn’t change my approach to this contest; I am getting on with the job of talking to as many members and supporters across the country as possible and making the case for a united, radical and credible Labour party.”
The five Labour members abandoned their legal challenge on Sunday, saying they could not afford to take the case further.
The group – Christine Evangelou, Hannah Fordham, Rev Edward Leir, Chris Granger and "FM", a teenage member – had raised £93,572 in donations through a crowdfunding website.
But in a statement published on the site, Fordham said: "Unfortunately, given the costs involved in pursuing the case further (the fee for getting the case even heard at the Supreme Court is around £8,000), we have taken the decision that this is where this particular legal case has to stop.
"But the case wasn't in vain – although we didn't succeed in reclaiming votes for the 130,000 disenfranchised members, we did win in the High Court, exposing facts which have spurred important conversations about the role of the Labour Party membership and the NEC."
Jim Waterson is a politics editor for BuzzFeed News and is based in London.
Contact Jim Waterson at email@example.com.
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