Background
This supplemental judgment concerned costs in landlord-and-tenant proceedings over Verbenagrove Ltd’s statutory right to a new tenancy. The landlords had argued that they had re-entered the premises for rent arrears and that this defeated the tenant’s renewal claim.
In the principal judgment, the High Court rejected that defence. It held that an expired lease could not be forfeited and that statutory occupation pending determination of a renewal application could be ended only by court order. The Circuit Court had subsequently fixed the terms of the new tenancy, and that order was not appealed.
The Court’s Holding
Simons J held that the tenant was entirely successful and was therefore presumptively entitled to its costs of both the Circuit Court and High Court stages. The fact that the High Court’s reasoning differed from the Circuit Court’s reasoning did not alter the ultimate outcome or displace that presumption.
The court made one material reduction. The tenant’s unsuccessful equitable set-off claim concerning repair expenditure was a distinct, weak issue that materially lengthened the Circuit Court hearing. On a broad-brush basis, the court ordered that the tenant recover 40% of its Circuit Court costs for the first module, but all of its High Court appeal costs. The court reserved the separate question whether costs should be adjudicated on a legal practitioner-and-client basis.
Key Takeaways
- Success for costs purposes on a de novo Circuit Court appeal is assessed by the ultimate outcome of the proceedings.
- A successful party may pursue reasonable alternative arguments without an automatic costs penalty.
- Costs may be reduced where a separable, unreasonable issue materially increased the expense of litigation.
Why It Matters
The decision applies the Legal Services Regulation Act 2015’s costs framework in a modular landlord-and-tenant dispute. It confirms that the successful tenant’s costs entitlement extended across both court levels, notwithstanding changes in the reasoning between the Circuit Court and High Court.
It also illustrates the court’s willingness to make a targeted, practical adjustment where an unsuccessful ancillary claim generated substantial avoidable costs, without undertaking a granular item-by-item costs exercise.