Steven Robert Coogan v Maryam Taheri

An unsuccessful appeal does not, without more, amount to unreasonable conduct for the purposes of an appeal costs rule. A party is entitled to challenge a costs order and pursue an appeal reasonably, even where the appeal is ultimately dismissed or has little merit. A costs order requires conduct that satisfies the rule’s requirement of unreasonableness. Correspondence suggesting agreement in principle does not create a binding agreement where the parties are still negotiating the terms of the order.

The landlords sought the costs of successfully defending the tenants’ appeal against a £70,000 costs order made by the First-tier Tribunal under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013. They relied primarily on an alleged agreement in correspondence and alternatively sought costs under rule 10 of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010. The Upper Tribunal had previously dismissed the tenants’ appeal. The issues were whether the correspondence formed a binding costs agreement and whether the tenants had acted unreasonably in bringing or conducting the appeal.

1. The application for the landlords’ appeal costs was dismissed. There was no order as to the costs of and incidental to the appeal.
2. The correspondence between counsel did not establish a concluded or binding agreement that the tenants would pay the landlords’ costs. At most, it recorded an agreement in principle while the parties continued to negotiate the terms of the order.
3. Rule 10(3)(b) of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010 permits a costs order where a party or representative has acted unreasonably in bringing, defending or conducting the proceedings. The tenants had been entitled to challenge the FTT’s costs order, had obtained permission to appeal, and had pursued the appeal in a manner that could not be characterised as unreasonable.
4. The failure of an appeal does not establish that it was wholly without merit or that it was brought or pursued unreasonably. An attempt to undermine or gloss an adverse finding of dishonesty was not, in the circumstances, unreasonable conduct warranting a costs order.
5. Parties against whom costs orders are made must have a genuine opportunity to challenge them on appeal. Where they do so reasonably, they should not face a costs sanction in a jurisdiction that is cost-neutral except where the Rules provide otherwise.

• First-tier Tribunal (Property Chamber): following a hearing on 3 and 4 October 2024, the FTT made a costs order of £70,000 against the tenants on 25 November 2024 under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, corrected on 5 December 2024.
• Upper Tribunal (Lands Chamber): permission to appeal was granted on 5 February 2025. The appeal was dismissed in a reserved judgment on 1 September 2025. The present application for the landlords’ appeal costs was dismissed.