Simon Nelson v Southern Electric Power Distribution

In compensation proceedings under the Electricity Act 1989, costs are governed principally by s.4 of the Land Compensation Act 1961 where that provision applies. An offer does not engage the statutory costs consequences if it is conditional on accepting a contribution towards costs or signing an agreement whose terms have not been established. Such an offer may nevertheless be relevant to the discretionary assessment of costs. The claimant should receive a reasonable period to consider it, assessed in context. A litigant in person may recover reasonable work done even without proving pecuniary loss, but the recoverable rate may be limited to £19 per hour. Costs must remain confined to the proceedings before the Tribunal and must be reasonable in amount and reasonably incurred.

This was a costs decision following the Tribunal’s determination of compensation in Nelson v Southern Electric Power Distribution, [2025] UKUT 0213 (LC). Compensation of £47,250 had been awarded to Mr Nelson following the grant of a necessary wayleave over his property.

SEPD had offered £50,000 compensation and £15,000 towards professional fees shortly before the substantive hearing. The issues were whether that offer was unconditional for the purposes of s.4 of the Land Compensation Act 1961, when it should affect the parties’ costs, what Mr Nelson could recover for his own time, and whether either party’s costs should be reduced for unreasonable conduct or excessive expenditure.

1. Statutory framework. Under paragraph 7(4) of Schedule 4 to the Electricity Act 1989, s.4 of the Land Compensation Act 1961 applied. Where it conflicted with s.29 of the Tribunals, Courts and Enforcement Act 2007 or the Tribunal Procedure Rules, s.4 prevailed.
2. SEPD’s offer. The offer of 12 May 2025 was not unconditional. It required Mr Nelson to accept £15,000 towards his professional fees rather than have those costs assessed or paid in full. It also required him to sign a settlement agreement whose terms were not before the Tribunal. The offer therefore did not engage the mandatory costs consequences of s.4(1)(a) of the 1961 Act.
3. The offer remained highly relevant under the Tribunal’s Practice Directions. It exceeded the compensation awarded by £2,750. In the circumstances, seven days was a reasonable period for consideration, expiring on 19 May 2025. Mr Nelson could recover his own costs only up to that date and was liable for SEPD’s reasonable costs incurred thereafter.
4. The Tribunal had no power to determine the costs of the confidential abortive mediation, absent agreement that they formed part of the reference costs. It also could not determine costs arising from Mr Nelson’s Court of Appeal application. His conduct in the reference was not unreasonable.
5. Under the Litigants in Person (Costs and Expenses) Act 1975, a litigant in person may recover for work done even without proving pecuniary loss. Adopting the approach under CPR 46.5(4)(b), the Tribunal allowed 167 hours at £19 per hour. Mr Nelson’s expert fees and appropriate disbursements were also allowed.
6. SEPD’s post-19 May costs were assessed summarily. Reductions were made for excessive solicitor resources, unnecessary expert attendance and counsel’s seniority. SEPD was awarded £40,950. Mr Nelson was awarded £25,724.50, plus VAT on the expert fees where applicable, and was responsible for the £624 hearing fee. The net amount could be deducted from the compensation under s.4(5) of the 1961 Act.

This was a costs decision following the Tribunal’s earlier compensation determination in Nelson v Southern Electric Power Distribution, [2025] UKUT 0213 (LC). The judgment records that permission to appeal an interlocutory order was refused by the Tribunal and subsequently by the Court of Appeal, but this decision was not itself an appeal.