Costs: rule 13 should not be used as an oppressive tool

Application for costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 must not be used as an oppressive tool or battleground for satellite litigation. In Connell v Beal Developments Ltd and others [2023] UKUT 135 (LC), the appellant was the secretary of a tenants’ association of a mixed-use estate in Lincoln. The respondents were landlords of different part of the estate. Under regulation 4 of the Tenants’ Associations (Provisions Relating to Recognition and Provision of Information) (England) Regulations 2018, the FTT was unable to give a certificate to an association representing fewer than 50% of qualifying tenants. In 2019, the appellant, in his capacity as secretary of the association and with the authority of its committee, applied to the First-tier Tribunal for a certificate of recognition under section 29(1)(b) of the Landlord and Tenant Act 1985. The association failed to appreciate that it had not met the 50% membership threshold for recognition. The association eventually withdrew its application when the respondents indicated that they were seeking to strike out its application and seek its costs under rule 13(1)(b). The FTT in its original decision ordered that the appellant and the association should pay £8,000 on account of the respondents’ costs on the basis that they had both acted unreasonably in bringing the proceedings. The association and the appellant appealed. The FTT subsequently reviewed its decision and found that only the appellant should pay the respondents’ costs after the respondents changed position and stated that they were not seeking to recover costs against the association. The appellant appealed and the respondents cross-appealed. In allowing the appellant’s appeal, the UT found that he could not be made personally liable for the costs of the proceedings. There was no basis for saying that he had brought the application. The appellant had acted as an agent of the association in his capacity as the secretary. The appellant had not purported to make the application in his own name. Further, he had not conducted the proceedings. His attendance at the hearings did not make him any more liable for an order for costs than any other member of the association. In dismissing the respondents’ cross-appeal that the FTT should have found that the appellant’s conduct had been unreasonable on the basis of further allegations, the UT repeated the salutary reminder given in Willow Court Management Company (1985) Ltd v Alexander [2016] UKUT 290 (LC); [2016] EGLR 48 that an application for costs under rule 13(1)(b) should not be regarded as routine or abused so as to discourage access to the tribunal and should not be allowed to become a major dispute in its own right. Elizabeth Dwomoh is a barrister at Lamb Chambers