Leasehold valuation tribunal –– Appeal –– Application for leave to appeal –– Leave refused by Lands Tribunal –– Costs incurred by respondent –– Rules 2 and 52 of Lands Tribunal Rules 1996 –– Service charges –– Section 20C of Landlord and Tenant Act 1985 –– LVT refusing to order landlord’s legal costs not recoverable as service charge expenditure –– Whether Lands Tribunal has jurisdiction to make costs order –– Whether respondent landlord entitled to costs of responding to unsuccessful application for leave to appeal
The respondent tenants’ association applied to the leasehold valuation tribunal (LVT), under section 19 of the Landlord and Tenant Act 1985, for various matters to be decided in respect of a property. Among other matters, the LVT refused to make an order under section 20C of the 1985 Act that the costs incurred by the applicant landlord in connection with the LVT proceedings were not to be regarded as relevant costs for service charge purposes. The LVT refused to grant to the tenants’ association permission to appeal; the Lands Tribunal refused the association’s application for such permission. The landlord applied to the Lands Tribunal for an award of costs, incurred in responding to that unsuccessful application in the sum of £6,509.75, plus VAT. The tenants’ association contended that the Lands Tribunal did not have jurisdiction to make an order on costs. The application was determined on the basis of written representations.
Decision: The application was allowed in part and costs of £1,500, plus VAT, ordered.
There was no reason to construe rr 2 and 52 of the Lands Tribunal Rules 1996 so as to exclude applications for leave to appeal against a decision of the LVT. The application for leave gave rise to a determination by the Lands Tribunal and constituted a “case” for the purposes of section 3(2) of the Lands Tribunal Act 1949. Rule 5C(7) provides for the making of written representations by a person who was a party to the LVT proceedings (see r 5B(1)), and, under r 5D(1), a hearing into the application can be held. A person applying for leave to appeal therefore knows that a respondent is entitled to oppose the application and may incur costs in doing so. Costs can be awarded under r 52 on an application for leave to appeal. A lump sum award, arrived at on a robust approach, was appropriate. The landlord’s representations assisted in the application for leave being refused.
No cases are referred to in this report.
Stan Gallagher (instructed by Georgallis & Co) appeared for the applicant landlord; David Carter (instructed by Jennifer Israel & Co) represented the respondent tenants’ association.
Giving the decision of the tribunal, MR NORMAN J ROSE FRICS said:
1. On 31 October 2000 the leasehold valuation tribunal (LVT) for the London Rent Assessment Panel issued its decision on an application made on behalf of Barrington Court Residents Association (the respondent) for various determinations under the Landlord and Tenant Act 1985, as amended, in respect of premises known as Barrington Court, Colney Hatch Lane, London N10 1QG. Among other matters, the LVT refused to make an order under section 20C of the Act that the costs incurred by the landlord, Barrington Court Developments Ltd (the applicant), in connection with the proceedings before the LVT, were not to be regarded as relevant costs to be taken into account in determining the amount of any service charge payable by the respondent. On 8 December 2000 the LVT refused to grant the respondent leave to appeal against that decision. The respondent then applied to this tribunal for leave to appeal and that application was in turn refused on 8 February 2001. The applicant now applies for an award of its costs incurred in responding to that unsuccessful application. It estimates such costs at £6,509.75, plus VAT of £1,139.21. I have received written submissions from the parties.
2. The respondent submits that this tribunal has no jurisdiction to make such a costs order, and, alternatively, that the circumstances are not such as to justify an award of costs in this case. If the tribunal is minded to award costs against it, the respondent submits that a modest fixed sum should be awarded.
3. Rule 52(1) of those rules provides:
Subject to the provisions of section 4 of the 1961 (Land Compensation) Act and of rule 28(11), the costs of and incidental to any proceedings shall be in the discretion of the tribunal.
4. By r 2(1), the term “proceedings” is defined as:
proceedings before the Lands Tribunal.
5. Neither section 4 nor r 28(11) applies in the present situation.
6. I can see no reason for construing “proceedings” in rr 2 and 52 so as to exclude applications for leave to appeal against a decision of the LVT. The application for leave gives rise to a determination by the tribunal, and, in my view, constitutes a “case” for the purposes of section 3(2) of the Lands Tribunal Act 1949. Rule 5(7) provides for the making of written representations by a person who was a party to the LVT proceedings (see r 5B(1), and, under r 5D(1), a hearing into the application can be held. A person applying for leave to appeal therefore knows that a respondent is entitled to oppose the application and may incur costs in doing so. In my view costs can be awarded under r 52 on an application for leave to appeal.
7. I consider that the circumstances of this application are such that it is appropriate for me to exercise my discretion by making an award of costs in favour of the applicant. The respondent’s application for leave to appeal failed, and, in my view, the representations submitted on behalf of the applicant assisted in the process. Moreover, this is, in my opinion, an obvious situation where a lump sum award, as authorised by r 52(4), would be appropriate.
8. I therefore turn to the amount of costs that I should order the respondent to pay. The applicant’s statement of costs, totalling £6,509.75, provided in response to a request from me, was made up as follows: Miss Roulla Fiakka, a grade 2 fee earner –– 22 hours and seven minutes at £180 per hour; Mr George Georgallis, a grade 1 fee earner –– six hours and five minutes at £225 per hour; Mr Sian Gallagher, of counsel, advising by telephone and in conference –– four hours at £100 per hour, and settling written submission on leave to appeal –– four hours at £100 per hour. Mr Gallagher’s charges for settling the written submission on costs were based upon one hour and 30 minutes at £100 per hour; and those of Miss Fiakka, for preparing and checking the bill, one hour and 10 minutes at £180 per hour.
9. The respondent objects to the amount claimed on the following heads: the level of fee earner; the hourly rate; the work done; counsel’s fees, and proportionality. It points out that its own legal charges for the work done in connection with the application for leave to appeal, exclusive of VAT, were £810.
10. I agree with the respondent that the legal costs itemised in the applicant’s statement of costs are quite disproportionate. It is noteworthy that counsel, who prepared the detailed written submission on the application for leave to appeal, was able to do so within four hours. He had been instructed in the substantive hearing before the LVT, and was thus fully conversant with the case. Against that background, it was clearly unnecessary for his instructing solicitors to spend a total of 28 hours and 12 minutes on dealing with the application. It was also unnecessary for counsel to spend four hours advising instructing solicitors on the matter.
11. I propose to adopt a robust approach in deciding what lump sum would be appropriate. I order that the respondent shall pay the applicant the sum of £1,500 in respect of the latter’s costs, plus VAT thereon.
Application allowed.
