AllowedFirst-tier Tribunal (Property Chamber)·18 August 2023

Landlord Successfully Recovers Costs from RTM Company

Case No.

📌 In brief

In this case, a landlord successfully recovered costs from a a company after the company failed to agree on the amount owed. The First-tier Tribunal ruled that the a company must pay the landlord's reasonable costs under the Commonhold and Leasehold Reform Act 2002.

⚖️ Legal holding

The tribunal is authorized to determine the amount of costs payable by a company under the Commonhold and Leasehold Reform Act 2002.

Topics

cost determinationright-to-manage companies

Provisions

Commonhold and Leasehold Reform Act 2002 s.88

📖 Technical summary

The tribunal confirmed the reasonableness of the costs claimed by the applicants and ordered the respondents to pay them.

📜 Headnote Official document

The First-tier Tribunal determined that a RTM company must pay reasonable costs to a landlord following a right-to-manage acquisition. The claimant sought costs under s.88(4) of the Commonhold and Leasehold Reform Act 2002, which the Tribunal confirmed were reasonable and due.

📚 Full judgment Official document

OUTCOME: Allowed

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00BF/LCP/2023/0004 Property : 46 [ADDRESS] [POSTCODE] Applicant: [redacted] Respondent : [redacted] : Determination of costs pursuant to s.88(2) CLRA 2002 Tribunal : Judge Shepherd Date of Determination : 31st July 2023

DETERMINATION

1. The Applicants, [APPELLANT] (“The Applicants”) are seeking a determination of costs pursuant to s.88(4) of the Commonhold and Leasehold Reform Act 2002 (“The Act”). This follows a No Fault Right to Manage acquisition by 46 St [COMPANY] (“The Respondents”). Surprisingly the Respondents have taken no role in the application, failed to follow directions given on 3rd May 2023 and have failed to agree the costs claimed which has necessarily put the Applicants to the cost of applying to the Tribunal.

2. The Respondents were incorporated on 22nd June 2021. Their claim for the RTM was made on 16th August 2021.

3. The Applicants sent a schedule of costs to the Respondents and the Tribunal on 28th May 2023. The solicitors’ costs consist of £357.50 on letters and £440 on documents. In addition the managing agents, [NAME] charge a fixed fee of £600. There is an invoice detailing the breakdown of the managing agent’s work and a copy of the management agreement outlining the fee structure. The total sought including VAT was £1667.

4. S.88 of the Act states the following:

88 Costs: general (1) A [COMPANY] is liable for reasonable costs incurred by a person who is— (a) landlord under a lease of the whole or any part of any premises, (b) party to such a lease otherwise than as landlord or tenant, or (c) a manager appointed under Part 2 of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises, in consequence of a claim notice given by the company in relation to the premises. (2) Any costs incurred by such a person in respect of professional services rendered to him by another are to be regarded as reasonable only if and to the extent that costs in respect of such services might reasonably be expected to have been incurred by him if the circumstances had been such that he was personally liable for all such costs. (3) A [COMPANY] is liable for any costs which such a person incurs as party to any proceedings under this Chapter before [the appropriate tribunal] only if the tribunal dismisses an application by the company for a determination that it is entitled to acquire the right to manage the premises. (4) Any question arising in relation to the amount of any costs payable by a [COMPANY] shall, in default of agreement, be determined by [the appropriate tribunal] .

5. Here the costs claimed by the Applicants are entirely reasonable applying the criteria in subsection (2) and the Tribunal has no hesitation in confirming that the costs are due and should be paid by the Respondents. Judge Shepherd

31st July 2023

RIGHTS OF APPEAL 1. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber) then a written application for permission must be made to the First-Tier Tribunal at the Regional office which has been dealing with the case.

2. The application for permission to appeal must arrive at the Regional office within 28 days after the Tribunal sends written reasons for the decision to the person making the application.

3. If the application is not made within the 28 day time limit, such application must include a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed despite not being within the time limit.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal and state the result the party making the application is seeking.

📊 How courts decide similar cases

Among 11 similar decisions in this collection:

Allowed11 cases

A snapshot of this collection — not a prediction of your case's outcome.

⚖️ What tends to weigh in cases like this

✅ Tends to be accepted

The RTM company is held responsible for the costs incurred by the landlord after receiving a claim notice.
The wording of the claim notice triggers liability for the RTM company's costs.
The court consistently rules in favor of landlords when claim notices are issued by RTM companies.
The presence of a claim notice from an RTM company leads to the awarding of reasonable costs to the landlord.
The decision emphasizes the RTM company's obligation to cover reasonable costs upon issuance of a claim notice.

❌ Tends to be rejected

(No factors identified that led to a negative outcome based on the provided cases.)

Patterns observed in similar cases in this collection — every case is unique.

❓ Frequently asked questions

What did this decision decide?

The decision confirmed that the RTM company must pay the landlord's reasonable costs.

Who was involved?

The case involved a landlord and a RTM company.

How did the court decide, and why?

The court decided that the RTM company must pay the landlord's costs because they were reasonable and agreed upon under the relevant legislation.

Which laws or rules were applied?

The Commonhold and Leasehold Reform Act 2002, specifically section 88, was applied.

What was the argument that mattered most?

The argument that mattered most was that the costs claimed by the landlord were reasonable and necessary.

Was the decision for or against the person who brought the case?

The decision was for the person who brought the case.

What does this mean for someone in a similar situation?

Someone in a similar situation may be able to recover reasonable costs from a RTM company if they follow the proper procedures.

What evidence or documents mattered?

The schedule of costs and the management agreement detailing the fee structure were important documents.

Can a decision like this be appealed?

Yes, a decision like this can be appealed to the Upper Tribunal (Lands Chamber).

Is it worth getting a solicitor for a case like this?

It is always recommended to seek advice from a qualified solicitor for cases involving legal disputes.

Official source: First-tier Tribunal (Property Chamber) — headnote and full judgment reproduced from the court's public records. View on the official source ↗Summary, holding, technical summary and questions: produced by Artificial Intelligence based on the official headnote and judgment. These are VadeLab’s own material and are not the work of the Court.This decision was issued by the First-tier Tribunal (Property Chamber) and is reproduced from its published records. VadeLab is not affiliated with, and this page is not endorsed by, that court or tribunal.