Goldstein v Conley

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLORD JUSTICE CLARKE,SIR ANTHONY EVANS,LORD JUSTICE MANTELL
Judgment Date04 May 2001
Neutral Citation[2001] EWCA Civ 637
Docket NumberCase Nos: A3/2000/2410 and 2411
Date04 May 2001

[2001] EWCA Civ 637

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION (THE HON MR JUSTICE GRAY) AND

ON APPEAL FROM THE LANDS TRIBUNAL

(HIS HONOUR JUDGE RICH QC)

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

Lord Justice Mantell

Lord Justice Clarke and

Sir Anthony Evans

Case Nos: A3/2000/2410 and 2411

Lionel Goldstein
Claimant Respondent
and
Ron Conley
Defendant Appellant

Mr Anthony Trace QC and Mr James Aldridge (acting pro bono) represented the Appellant

Mr Gary Cowen (instructed by Messrs Tibber Beauchamp-Ward) represented the Respondent

LORD JUSTICE CLARKE

Underlying Dispute

1

There are two appeals before the court which have a somewhat curious history. They arise out of a relationship of landlord and tenant between the parties. The respondent in both appeals is Lionel Goldstein. He was the owner of a reversion to the raised ground floor flat at 27 Belsize Park Gardens in North London, which was let to the appellant in both appeals, namely Ron Conley. I shall refer to the respondent as 'the landlord' and I shall refer to the appellant as 'the tenant', although he was in fact the assignee of the original lease.

2

The lease, which was for 21 3/4 years less three days, expired on 25 th September 1995. In the meantime, on 27 th March 1995, the tenant served a notice under section 42 of the Leasehold Reform, Housing and Urban Development Act 1993 ('the 1993 Act') claiming the grant of a new lease. The tenant proposed a premium of £90,000, whereas the landlord served a counter-notice proposing a substantially greater figure by way of premium. The question of the appropriate premium was referred to a leasehold valuation tribunal ('LVT').

The LVT and the Lands Tribunal

3

On 4 th July 1996 the LVT determined that the appropriate premium was £143,000. It had no power to order either party to pay the costs and did not do so. Both parties appealed to the Lands Tribunal. The appeals were heard by His Honour Judge Rich QC. As I understand it, during the course of the appeal the parties, who were both represented by counsel, reached an agreement which led to the withdrawal of the cross-appeal. The landlord called two expert witnesses, one of whom had given evidence and indeed conducted the landlord's case before the LVT and the other of whom had not given evidence before the LVT. The tenant called an expert witness who had also given evidence before the LVT. The tenant also had leave to call a second expert, but in the event his evidence was not necessary. On 13 th August 1998, Judge Rich allowed the landlord's appeal and held that the total premium payable for the grant of a new lease was £191,212.50. His reasoning is not relevant to the issues which arise on these appeals but can be seen from pages 137 to 144 of the report of his judgment at [1999] 03 EG 137.

4

The parties had reached agreement as to how the costs of the appeal to the Lands Tribunal were to be dealt with. As to costs, Judge Rich said this (at page 144):

"It was accepted between the parties that if the landlord was successful on both issues, as he has been, costs should follow the event. I therefore award the landlord the costs of the appeal and the cross-appeal to be taxed on the High Court scale, if not agreed, but since the tenant is legally aided such costs are not to be enforced without leave of the tribunal."

It is a reasonable inference that the agreement which led to the order made by the judge was reached with the assistance and on the advice of counsel.

5

As appears from that passage, the judge at that time thought that the tenant was legally aided before the Lands Tribunal, whereas the true position was that it was the landlord who was legally aided. As a result, the matter came back before the judge on 18 th September 1988, when he said this (at page 144):

"Additional Note

Since publication of my decision dated 13 August 1998, it has been pointed out to me that it is the landlord and not the tenant which is the legally aided party. Accordingly, my decision as to costs is that I award the landlord the costs of the appeal and cross-appeal, to be taxed on the High Court scale if not agreed.

The tenant has taken the opportunity created by my error to make submissions as to the appropriateness of this order. The order, however, follows the agreement made by the parties at the end of the hearing, which I have recorded in my decision, and I see no proper grounds for reopening this matter; the agreement in any case seems to me properly to reflect what I would myself have decided."

6

The order for costs as drawn up ordered "that Appellant be awarded the costs of this appeal and cross-appeal to be taxed on the High Court scale if not agreed". The order was originally dated 20 th August 1998, but (in its present form) is stated to have been amended on 18 th September 1998 and reamended on 5 th November 1999. As I read the order, it created an obligation on the part of the tenant to pay the landlord's costs of the appeal and cross-appeal as taxed.

Taxation of Costs

7

On 2 nd November 1998 the tenant wrote personally to the registrar taking the point that he was not liable for costs because of the terms of the 1993 Act. The registrar referred the matter to Judge Rich and, no doubt in the light of the judge's response, on 24 th November 1998 wrote to the tenant explaining that an order had been made, that the Lands Tribunal was functus officio and that the landlord was entitled to have his costs taxed in accordance with the order, but that, if both parties agreed, Judge Rich was prepared to consider the question of costs again before a taxation. The landlord did not, however, agree and the tenant was informed that the taxation would proceed. On 28 th January 1999 the tenant wrote to the registrar asserting that he was not liable for the costs on the ground that a tenant is not liable under the relevant statute for the landlord's costs "before a leasehold valuation tribunal or anyone acting as a leasehold valuation tribunal". He wrote that he had not asked for the costs to be taxed and that he would not be challenging them or attending at the taxation. He also said that another reason why he would not be attending was that he had not been able to ascertain whether to do so would amount to an admission of liability.

8

The taxation took place on 3 rd February 1999 and on the same day the landlord's solicitors wrote to the tenant to tell him that he was liable to pay a total of £40,301.1On 9 th February the tenant replied again saying that he was not liable for the costs because of the terms of the 1993 Act. However, in the light of his decision on the taxation, the registrar issued a certificate dated 9 th February 1999 which stated that the costs were allowed at £39,557.57 inclusive of VAT. That certificate appears to have contained a slight error because it was subsequently amended on 18 th June 1999 to the sum of £40,301.18, which is the amount referred to in the letter of 3 rd February.

Appeals from Lands Tribunal

9

In the meantime the tenant took various steps to appeal from the order made by Judge Rich. We do not have all the documents which related to those steps, but it appears that from the outset the tenant expressed a desire to appeal against both the order on the merits and the order on costs. The tenant corresponded both with the registrar of the Lands Tribunal and with the Civil Appeals Office. The position was complicated by the fact that in order to appeal on the merits it was at that time necessary to ask the Lands Tribunal to state a case. It appears that the tenant wrote to the Civil Appeals Office on both 15 th September and 7 th October 1998 and that the office only replied on 29 th December after consulting the Deputy Registrar of Civil Appeals. On 29 th December the tenant was informed that the deputy registrar had directed that, if he was appealing the order for costs alone, he would require leave to appeal, but that, if he wished to appeal any substantive part of the decision, he should have asked the Lands Tribunal to state a case. Because of the delay, time for lodging an application for leave to appeal was extended to 25 th January 1999.

10

On receipt of the letter dated 29 th December the tenant wrote to the Registrar of the Lands Tribunal on 8 th January 1999 saying that he had yet to decide whether he would appeal separately with regard to costs, which would raise the question whether section 3(5) of the Lands Tribunal Act 1949 ('the 1949 Act') was overridden by section 60 of the 1993 Act. He also set out in detail the basis of his appeal on the merits and asked the Lands Tribunal to state a case. By a change of the law which came into effect as from 1 st January 1999, leave was necessary from either the Lands Tribunal or the Court of Appeal before a case could be stated. The question of leave was referred to Judge Rich who refused it. His decision was communicated to the tenant by letter dated 26 th January 1999.

11

In the meantime the tenant was given what may have been somewhat conflicting signals from the Civil Appeals Office on the one hand and the Lands Tribunal on the other. On 19 th January the Civil Appeals Office told him that if he wanted to appeal the whole decision he would need to ask the Lands Tribunal to state a case and, if he failed to obtain leave, he could make an application to the Court of Appeal. On 22 nd January the Lands Tribunal told him that, if he was refused leave by Judge Rich on the substantive issue and he wanted to pursue an appeal solely on the question of costs, he would have to make a further application, apparently to...

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