Guidance

Costs, fees and expenses you can recover from the residential property tribunal

Updated 4 September 2024

About this guide

This guide helps you understand what happens about the costs, fees and expenses in an application to the First-tier Tribunal Property Chamber (Residential Property).

You usually must pay your own expenses and legal costs. However, the tribunal can order the other party to pay costs when:

• there is a written contract or lease allowing a party (usually a landlord) to claim costs from the other party (usually a tenant)
• an act of parliament says so
• a party’s legal representative has unreasonably increased costs incurred by another party (sometimes called a ‘wasted costs’ order)
• a party has unreasonably brought, defended or conducted the case

Written contract

This situation can be confusing as tenants especially may not realise that, by signing up to a long lease, they may have taken on the commitment to pay the landlord’s costs following a residential property tribunal.

There are 3 main arrangements that a lease may describe:

1. A landlord can claim legal or other costs as a service charge. The tribunal can decide if the tenant should pay these costs and if they are reasonable. If the landlord wants to claim the costs of tribunal proceedings as part of a service charge, the tribunal can make an order preventing that.
2. A tenant must pay legal or other costs if they have disregarded the lease or forfeited it by breaching its terms. The tribunal can decide if the tenant should pay these costs and if they are reasonable. If the landlord wants to claim the costs of tribunal proceedings from a leaseholder, the tribunal can make an order preventing that.
3. A tenant must pay legal or other costs to a landlord for granting permission for something, for example subletting a room. The tribunal can decide if the tenant should pay these costs and if they are reasonable.

Act of parliament

There are acts of parliament that say someone (usually a tenant) is liable to pay the reasonable costs of another (usually a landlord):

• under the Leasehold Reform Act 1967 and the Leasehold Reform, Housing and Urban Development Act 1993, tenants who want to extend a lease or buy the freehold of a house or block of flats, must pay the landlord’s costs, including a valuation fee.
• under the Commonhold and Leasehold Reform Act 2002, tenants can get together under certain conditions to take over the management of a building. This is called the ‘right to manage’. The act says that tenants must pay the landlord’s costs.

In all these cases, the tribunal can assess those costs so that only a reasonable amount must be paid.

Wasted costs

This is where actions of a party’s solicitor or other representative have unnecessarily increased the costs of the other party. For example, by insisting on a full hearing when it was not necessary.

Wasted costs orders are rare but, where they are made, they are often against the solicitor or other representative themselves.

The tribunal decides whether there is any liability and, if so, assesses the reasonableness of the claim.

This is a power given by the Tribunals, Courts and Enforcement Act 2007.

Unreasonable behaviour

The tribunal can make an order to say that a party has behaved unreasonably in bringing, defending or conducting an application.

In most cases, one party ‘wins’ and the other ‘loses’. However, the general rule is that the losing party does not have to pay the costs of the winning party. It is only conduct or behaviour that is relevant here and it would have to be considered as unreasonable. The tribunal may in fact order the winning party to pay the costs of the losing party if the conduct of the winning party has been unreasonable.

The tribunal can assess those costs so that only a reasonable amount must be paid.

This comes from rule 13 of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013.

Reasonable costs

Once the tribunal has decided who should pay costs, they then decide what is reasonable. They will assess reasonable legal costs by looking at the hourly charging rate of the solicitor and the time spent.

Other costs and expenses will depend on what they are and whether the receiving party can provide evidence of the loss. Fees paid to the tribunal can be included. However, costs such as loss of earnings, travel and photocopying charges are sometimes more difficult to prove. The tribunal will look at the claim and decide.

Sometimes people have difficulties claiming an hourly rate for their time. The tribunal must decide what ‘loss’ has been incurred – this is difficult when someone tries to claim for time without evidence. For example, this may be evidence of what hourly rate they might receive for other work.

If you are having costs, fees and expenses claimed from you, you should also check the reasonableness. You may want to get legal advice about the claim and the amount that would be reasonable.

Get help or guidance

For more information and links to application forms, see the guide about how to solve a residential property dispute.

If there is anything about the process that you do not understand, contact the regional tribunal office. They can speak to you about the procedures relating to the application but they cannot give legal advice or interpret the tribunal’s decision.

The tribunal’s procedures are governed by statutory rules called the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013.

Tribunal decisions are published on GOV.UK, unless a party makes a written request with reasons for why this should not be done.

For advice on how to present your case, or if you need to understand more about the law, you can consult a solicitor or Citizens Advice.

Citizens Advice

A charity and network of local charities, offering free, confidential advice online, over the phone, and in person. They offer advice on housing issues, such as tenants’ rights and responsibilities.

www.citizensadvice.org.uk