Mohammed Bashir v The London Borough of Newham

In a costs decision following a successful appeal under section 18 of the Land Compensation Act 1961, the starting point is that costs follow the event. A landowner who obtains a materially more favourable certificate than the authority offered is the successful party, even though the certificate is less favourable than the landowner sought.

An order requiring that successful party to pay the unsuccessful authority’s costs of particular issues is exceptional. It requires a distinct issue causing additional expense and an assessment of the overall justice. However, a party may be required to meet isolated costs needlessly incurred because its advisers failed to communicate a material change to its case.

Mohammed Bashir v The London Borough of Newham concerned the costs of Mr Bashir’s appeal against a nil certificate of appropriate alternative development issued under section 18 of the Land Compensation Act 1961.

In the substantive decision, Bashir v London Borough of Newham [2024] UKUT 00146 (LC), the Tribunal cancelled the authority’s certificate. It later issued a certificate allowing 8,214 square metres of mixed-use development. The authority nevertheless sought all or part of its costs, principally on an issues-based basis. It also sought the costs of heritage evidence said to have been wasted after a late reduction in the height of the proposed tallest tower.

The central question was whether the authority, although unsuccessful overall, should recover any costs under rule 10(6)(aa) of the Tribunal Procedure Rules.

1. The authority’s application succeeded only in a limited respect. Mr Bashir was the successful party. Before the appeal, the authority offered no appropriate alternative development. The certificate ultimately granted was materially more favourable to him than the authority’s revised position, although less favourable than his own proposed development.

2. Under section 29 of the Tribunals, Courts and Enforcement Act 2007 and rule 10(6)(aa) of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010, the Tribunal’s costs discretion had to be exercised consistently with ordinary costs principles. An issues-based order may reduce a successful party’s recovery where a discrete issue caused additional costs. Requiring that party to pay the unsuccessful party’s costs of an issue is a further and exceptional step. The Tribunal applied the guidance in Pigot v The Environment Agency [2020] 1444 (Ch), R (Viridor Waste Management Ltd) v Commissioners for HM Revenue and Customs [2016] EWHC 2502 (Admin), and Summit Property Ltd v Pitmans [2001] EWCA Civ 2020.

3. The landowner had not acted unreasonably in advancing residential use or a tower above 50 metres. Nor was there anything otherwise suitably exceptional in the appeal to justify an issues-based award in the authority’s favour. The authority’s claims for all its costs from November 2023, and for costs of the issues on which it said it had succeeded, were rejected.

4. There was, however, a discrete and avoidable cost. The reduction of the tallest tower from 58 to 52 metres was not communicated until expert reports were exchanged. The authority’s heritage expert had therefore unnecessarily prepared evidence addressing effects on the Three Mills Conservation Area and the listed Tide Mill. Mr Bashir was ordered to contribute 20% of the costs of that expert’s evidence, the amount to be taken into account when compensation is assessed under section 17(10) of the Land Compensation Act 1961.

• Upper Tribunal (Lands Chamber): In Bashir v London Borough of Newham [2024] UKUT 00146 (LC), the Tribunal allowed the section 18 appeal by cancelling the authority’s nil certificate. It subsequently issued a positive certificate. This decision determined the authority’s consequential costs application.