Steven Robert Coogan & Anor v Maryam Taheri & Anor

Under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, unreasonable conduct is assessed objectively. The question is whether the conduct permits of a reasonable explanation, having regard to the party’s circumstances, including the absence of legal advice. An unsuccessful argument, inadequate preparation or an unrealistic outcome is not, without more, unreasonable.

The inquiry is sequential: first, whether the conduct was unreasonable; secondly, whether a costs order should be made; and thirdly, the appropriate terms. No causative link between the unreasonable conduct and particular costs is required. An appellate tribunal should not substitute its discretion where the first-instance tribunal applied the correct principles, considered relevant matters and reached a rational conclusion.

Tenants appealed against a First-tier Tribunal (Property Chamber) decision concerning residential property proceedings. The FTT had made no order on the substantive applications for service-charge determination, appointment of a manager and dispensation from consultation, but later ordered the tenants to pay £70,000 in costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013. It also refused relief under section 20C of the Landlord and Tenant Act 1985.

Permission to appeal was granted on the grounds that the FTT had misapplied the test for unreasonable conduct and had exercised its discretion to award costs improperly. The central issues were the effect of the tenants’ unrepresented status and the proper scope of appellate review.

1. Appeal dismissed. The FTT had correctly applied the rule 13(1)(b) framework stated in Willow Court Management Co (1985) Ltd v Alexander [2016] UKUT 290 (LC).
2. At stage one, the issue is whether the party acted unreasonably. The objective assessment asks whether a reasonable person in that party’s circumstances would have acted similarly, or whether the conduct has a reasonable explanation. The absence of legal advice is relevant. A litigant in person should not be judged as though they possessed professional legal knowledge or procedural familiarity. Nevertheless, unrepresented status does not prevent a finding of unreasonable conduct.
3. The FTT was entitled to take account of the tenants’ intelligence, experience and conduct, including the pursuit of hopeless allegations and serious allegations of fraud and other wrongdoing. Its finding that Mr Coogan had acted recklessly as to the truth of allegations was a finding of dishonesty, not merely carelessness. The FTT was entitled to read its costs decision with the substantive judgment, the parties’ submissions and the tenants’ skeleton argument.
4. At stage two, the decision whether to make a costs order is discretionary. The FTT was entitled to regard the vigorous pursuit of obviously bad points and reckless or careless allegations as vexatious conduct, in the ordinary sense of conduct designed to harass rather than advance resolution. A different tribunal might have exercised its discretion differently, but that did not justify appellate intervention.
5. No causative link between the unreasonable conduct and particular costs was required. The nature, extent and consequences of the conduct remained relevant to whether an order should be made and to its form. The appeal was therefore dismissed.

• Upper Tribunal (Lands Chamber): appeal against the FTT’s costs decision dismissed. Permission to appeal had been granted on 5 February 2025.
• First-tier Tribunal (Property Chamber): by a decision dated 25 November 2024, corrected on 5 December 2024, ordered the tenants to pay £70,000 under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 and refused an application under section 20C of the Landlord and Tenant Act 1985.