Michael Connell v Beal Developments Ltd & Ors

An order for costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 may be made only against a person who has brought, defended or conducted the proceedings. A secretary who signs documents and communicates with the tribunal as agent for an unincorporated tenants’ association does not thereby become personally responsible for the proceedings. Attendance at hearings is insufficient without more. Even if the secretary were treated as bringing or conducting the proceedings, misunderstanding the statutory scheme, omitting signatures from an evidential list, or failing to withdraw an application earlier would not, without more, necessarily amount to unreasonable conduct. Costs applications should be dealt with summarily and must not be used to discourage access to the tribunal.

Michael Connell, secretary of a tenants’ association, appealed against a costs order made by the First-tier Tribunal (Property Chamber). The association had applied for a certificate of recognition under section 29 of the Landlord and Tenant Act 1985, despite having fewer than 50% of the qualifying tenants as members. The application was later withdrawn.

The FTT ordered both the association and Mr Connell to pay the landlords’ costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, treating their conduct as unreasonable. On review, the FTT set aside the order against the association but maintained its view that an order could be made against Mr Connell personally. The appeal concerned whether he was a person bringing or conducting the proceedings and whether the conduct relied upon justified an order for costs.

1. Appeal allowed. The costs order against Mr Connell was set aside.
2. Rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 permits a costs order in a residential property case only against a person who has acted unreasonably in bringing, defending or conducting proceedings. It does not provide a general power to make a third-party costs order.
3. An unincorporated association is a “person” for the purposes of the FTT Rules by virtue of section 5 and Schedule 1 to the Interpretation Act 1978. It may therefore apply in its own name. That does not give it separate legal personality; the association remains a collective description of its members.
4. Mr Connell signed the application and other documents in his capacity as secretary and agent. The application identified the association as the applicant, and the FTT itself described Mr Connell as a third party. He had neither brought nor conducted the proceedings personally. The proceedings were brought by the association and conducted through its management committee and agents. His attendance at hearings did not alter that conclusion.
5. Alternatively, the matters relied upon by the FTT did not establish unreasonable conduct. A lay applicant’s misunderstanding of the effect of the 2018 Regulations and the tribunal’s powers is not, by itself, unreasonable. The absence of signed names on a membership list was not a statutory or procedural requirement whose breach necessarily amounted to unreasonable conduct. Nor was it sufficient, without more, that the application was not withdrawn sooner, particularly when the circumstances of withdrawal were unclear.
6. The respondents’ additional allegations concerning disproportionate material and an alleged campaign by another person could not make Mr Connell personally liable for conduct of the association or others. The recognition application should have been struck out promptly, but the respondents’ own lengthy response was also disproportionate. Costs applications under rule 13(1)(b) should not be routine, abusive or allowed to become major disputes in their own right.

• First-tier Tribunal (Property Chamber): On 12 September 2022, ordered the association and Mr Connell to pay costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013.
• First-tier Tribunal (Property Chamber, review): On 7 November 2022, set aside the costs order against the association but maintained the decision that a costs order could be made against Mr Connell personally.
• Upper Tribunal (Lands Chamber): Allowed the appeal and set aside the costs order against Mr Connell.