1st November 2016
Solicitors costs of and incidental to the preparation of a counter notice were recoverable under s. 60 LRHUDA 1993. There ought to be some reduction in costs where a landlord was dealing with multiple claims involving the same building.
The landlord claimed costs under s. 60 LRHUDA 1993 in the sum of £1,725 plus VAT. S. 60 provides as follows:
“60. Costs incurred in connection with new lease to be paid by tenant.
(1) Where a notice is given under section 42, then (subject to the provisions of this section) the tenant by whom it is given shall be liable, to the extent that they have been incurred by any relevant person in pursuance of the notice, for the reasonable costs of and incidental to any of the following matters, namely:
but this subsection shall not apply to any costs if on a sale made voluntarily a stipulation that they were to be borne by the purchaser would be void.”
The issues were:
The FTT reduced those costs to £845 plus VAT.
The Upper Tribunal (HHJ Huskinson sitting with the Registrar as an assessor) held as follows:
Prior to this decision there was, surprisingly, no authority on whether the costs of preparation of a counter notice fell within s. 60 of the Act, although it was widely assumed that they did. The basis of the decision was that the cost of a counter notice was incidental to each one of the sub-paragraphs (a) (b) and (c) of section 60(1). It is sometime the case that it is unclear whether a particular tenant or property qualifies under the Act and thus advice is needed as to whether a counter notice admitting the claim or a counter notice disputing the claim should be served. The reasoning in this case suggests that there would be a good case to say that the cost of advice on that issue would also be recoverable.
Solicitors acting for landlords will also read with some satisfaction the Upper Tribunal’s finding that it was reasonable for the landlord to use a Grade A fee earner for the conveyancing work.
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