THE anti-poverty campaigner the Revd Paul Nicolson has won the first stage of a High Court battle against a London council after he refused to pay his council tax in protest at the fines the authority was imposing.

Mr Nicolson, a retired priest, was given permission to apply for judicial review by Mr Justice Green at the Royal Courts of Justice on Tuesday morning. The complex legal case centres on the £125 order for costs given to everyone summoned to a magistrates' court for not paying council tax in the London borough of Haringey.

Mr Nicolson refused to pay his council tax last year in order to highlight what, he claims, was an unfair rise in the costs from £95 to £125 in 2010. When he asked the magistrates at his hearing to explain how the figure of £125 was arrived at, they declined. The judicial review will be of that decision.

Speaking after the judgment, Mr Nicolson said: "I hoped we would get judicial review, but he has taken it far further than that: it's a shot across the bows of every single local authority and every single magistrates' court. I knew it was a question that had to be asked, not for myself, but because I knew the damage being done by housing-benefit cuts, the one-per-cent freeze on benefits, on council tax being enforced. I know that it is the law that is the problem."

Ruling, Mr Justice Green said: "It seems to me the issue is one of considerable public importance, both for council-taxpayers and for local authorities. I grant permission for the claimant to apply for judicial review." In the review of Tottenham Magistrates, the judge said, Haringey Council should be considered the primary defendant.

The relevant law states that only "reasonably incurred" costs can be imposed. Mr Justice Green said that magistrates should not merely take a council's word that the costs they asked for were in fact accurate.

"It will not be enough for the authority to simply [state] certain costs - the court will wish to see that the authority has not just picked a figure out of the air but has addressed itself to whether there is a reasonable causal relationship between the cause and the costs."

Counsel for the magistrates, Josephine Henderson, argued that the magistrates had in fact heard submissions "in general terms" about the justification for setting costs at £125, which was a sufficient level of detail, given that the courts saw up to 20,000 cases of council-tax liability each year. She also said that Mr Nicolson could pursue his complaint by other means.

Helen Mountfield, acting for Mr Nicolson, said that government guidance recommended that councils provide a breakdown of the costs of a summons; and the council had yet to provide a full breakdown to Mr Nicolson, which it should do for "fairness and transparency". It was also important to ensure that the council had not hiked the costs up to £125 as a deterrent, as this would be unlawful, she said.

The judge agreed, and said that the courts were entitled to check whether a proper allocation of costs had been undertaken rather than a figure chosen for political reasons.

As his judgement was read out, a group of Mr Nicolson's supporters at the back of court cheered quietly, and later applauded the retired priest out of the court. He said he was motivated by love, justice, and solidarity for people undergoing "innocent suffering, which the enforcement of debts against inadequate incomes is".

"There was carelessness in both the magistrates and the local authority, they had just not been called to account," he added, saying he always had faith in the British justice system to get it right eventually.

"I fear the Church of England, which I love, is both part of the problem and part of the solution," he said. "It is at one time caught up in the worst aspects of free market capitalism and at the other end it is doing wonderful work with the poor. But it can't look effectively beyond foodbanks and credit unions; what is needed is a powerful lobby to change the structures and laws and get a fair system, which we have not got."

"It's the good old saying: 'When I give food to the poor, they call me a saint. When I ask why they are poor, they call me a communist.'"

'The response of the C of E is to tinker around the edges of this disaster for the poorest citizens...' - Letter from Mr Nicolson