Commonhold and Leasehold Reform Act 2002

[F1 87B Power of tribunal to order costs where claim ceases E+W

(1) The appropriate tribunal may, on the application of a person (“the applicant”) that incurs costs in consequence of a claim notice given by an RTM company, order that the RTM company is liable to the applicant for the costs if all of the conditions in subsection (2) are met.

(2) The conditions are—

(a) the claim notice—

(i) is at any time withdrawn or deemed to be withdrawn by virtue of any provision of this Chapter, or

(ii) at any time ceases to have effect by reason of any other provision of this Chapter;

(b) the RTM company acts unreasonably in—

(i) giving the claim notice, or

(ii) not withdrawing it, causing it to be deemed withdrawn, or causing it to cease to have effect sooner;

(c) the applicant is—

(i) a landlord under a lease of the whole or any part of the premises,

(ii) party to such a lease otherwise than as landlord or tenant, or

(iii) a manager appointed under Part 2 of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises;

(d) the costs are incurred before the claim notice is withdrawn, is deemed withdrawn, or ceases to have effect;

(e) the costs are incurred other than in connection with proceedings before a court or tribunal;

(f) the costs are reasonably incurred.

(3) Where the appropriate tribunal orders that an RTM company is liable under subsection (1), each person who is or has been a member of the RTM company is also liable (jointly and severally with the RTM company and each other such person).

(4) But a person is not liable if—

(a) the lease by virtue of which they were a qualifying tenant has been assigned to another person, and

(b) that other person has become a member of the RTM company.

(5) The reference in subsection (4) to an assignment includes—

(a) an assent by personal representatives, and

(b) assignment by operation of law where the assignment is to a trustee in bankruptcy or to a mortgagee under section 89(2) of the Law of Property Act 1925 (foreclosure of leasehold mortgage).]

Textual Amendments

F1 Ss. 87A, 87B inserted (3.3.2025) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 50(3), 124(3); S.I. 2025/131, reg. 2(b)