Is the FTT starting to flex its wasted costs muscles?

In a recent case, an RMC had brought a service charge matter to the County Court. The respondent leaseholders then successfully applied to have the case transferred over to the FTT.

Now that the matter is in the FTT, the respondents are seeking to rely on company constitutional arguments, which are arguments that need to be dealt with at the County Court and are not within the FTT’s powers, making a nonsense of the transfer of the case.

 At the hearing, the FTT commented that they will seek to transfer the constitutional company arguments back to the County Court. Importantly, the FTT also advised that they would be keen to see the RMC make a wasted costs application against the leaseholders once the order to transfer is made.

While the final determination is awaited, this is a recent example of the FTT showing clear proactivity in the use of its wasted costs powers and should act as a clear warning to anyone seeking to bring, defend or conduct a claim in an ‘unreasonable’ manner.

In the highlighted case, it may well have been more to do with the leaseholders’ ignorance of the FTT’s powers than a wilful or ‘unreasonable’ attempt to delay the process, but the outcome may well be the same: a significant wasted costs order that could have been avoided.

Property management professionals, RMCs and leaseholders alike must be able to demonstrate that a) they understand each court’s powers and how to use them, and that b) they are making their best endeavours to comply.