Summary

A lessee's request for the dismissal of his claim for a mandatory interim injunction was not equivalent to a request to discontinue his claim under CPR r. 38. The judge had been entitled to consider the factual background of the parties' positions and make a costs order in the lessee's favour on the basis that he had obtained the relief sought in the proceedings by consent.

Facts

The Freeholder (W) had suspended lift services at the building containing the leasehold property. The Leaseholder (S) had brought proceedings against W for a mandatory injunction to restore lift services. At the door of court, W agreed to restore the lift services.

The First Tier Tribunal later found that W had failed to credit S for various payments to the service charge account. At a further hearing at court to restore the mandatory interim injunction, S invited the court to dismiss the claim on the basis that lift services had now been restored.

The Judge, in considering the appropriate costs award to make, analysed the findings of the Tribunal and found that S had gained a substantial practical advantage by making the application for an injunction. The judge therefore awarded S his costs of the interim injunction application. W appealed, arguing that the decision to dismiss the claim was similar to S discontinuing the action and therefore S should not have been entitled to his costs. It was further argued that the judge was wrong to go into the background of the service charge dispute between the parties when deciding on the appropriate costs order in the injunction matter.

Issues

The key issues on appeal to the High Court were:

  1. Was the claimant leaseholder’s invitation to the court to dismiss the action for an injunction as the lift service had been restored effectively a discontinuance of the claim (the default position under the CPR being that the claimant must pay the defendant’s costs up to the date of discontinuance)?
  2. Was the Judge right to consider the background of what had happened in the FTT proceedings when considering the appropriate costs order in the application to court for an injunction?

Decision on Appeal

On appeal, Mr Justice Garnham held that:

  1. the invitation to withdraw due to the Claimant having obtained the relief sought was clearly not equivalent to discontinuing the claim.
  2. The trial Judge has a wide discretion as to costs and the Judge here had been entitled to consider the factual background as to the merits of the parties' positions and in coming to the conclusion that he did.

This decision shows the court taking a commonsense approach in proceedings where the Claimant had clearly obtained the relief that he sought (albeit by agreement and not by order of the court). It also helpfully clarifies that a Judge of the Court considering the appropriate costs order to make can legitimately have regard to determinations made in related Tribunal proceedings.