GEORGE WILLIAM CHRISTOS MAUREEN ELLEN CHRISTOS v SECRETARY OF STATE FOR THE ENVIRONMENT, TRANSPORT AND THE REGIONS ACQ/69/2001
[1]By a decision dated 24 June 2002 I determined the compensation payable to Mr George W Christos and Mrs Maureen E Christos (“the claimants”) for the freehold interest in a dwellinghouse and adjoining land known as Torver Beck, Sittingbourne Road, Detling, Maidstone, Kent, ME14 3ES at £618,945. By an addendum to that decision dated 8 November 2002 I ordered that the claimants should recover 60% of their costs of the reference from the acquiring authority, the Secretary of State for the Environment, Transport and the Regions.[2]As a result of consideration by the Court of Appeal on 25 July 2003, both the compensation and costs orders were remitted to this Tribunal. I have received written submissions from the parties concerning the re-determination of both matters.[3]It is agreed that the total compensation payable should be £498,945.[4]In their initial submissions, the claimants suggested that the Tribunal’s original costs order should stand and the acquiring authority submitted that it should pay the claimants’ costs up to the date of the sealed offer but, thereafter, the claimants should bear the acquiring authority’s costs. Both parties then made further submissions, in which their respective positions changed. The claimants said that, on the assumption that the Tribunal amended its order, there should be no order as to costs after the date of the sealed offer. The acquiring authority suggested that it should only bear 60% of the claimants’ costs up to the date of the sealed offer.[5]The acquiring authority pointed out that the original order that it should pay 60% of the claimants’ costs reflected the Tribunal’s conclusion that it had been unreasonable for the claimants to pursue their claim for loss of profits. Therefore, the acquiring authority should only be responsible for 60% of the claimants’ costs up to the date of the sealed offer. There were no special reasons why the claimants should not pay the acquiring authority’s costs after that date. Even if there were, since the claimants’ special reasons argument related exclusively to that part of the award that concerned the status of the acquiring authority’s “subject to contract” offer, the acquiring authority should have all its other costs paid by the claimants from the date of the sealed offer.[6]In relation to its costs after the sealed offer, the claimants contended that the behaviour of the acquiring authority, in withdrawing from the £500,000 offer made in the letter dated 12 March 1999 and in allowing the claimants to enter into a contract on 4 November 1999 to acquire their relocation property, constituted special reasons within the meaning of s4 of the Land Compensation Act 1961. The claimants pointed out that, although the Court of Appeal had ruled that the acquiring authority was entitled, in law, to resile from the offer of £500,000, it had refused to order that the claimants should pay the costs of the acquiring authority in the Court of Appeal. The claimants referred in particular to the following extracts from the record of submissions before the Court of Appeal: 2 “THE VICE-CHANCELLOR: Even if having succeeded on a matter of law, in any other sense all this litigation has been triggered by the fact that the acquiring authority went back on the agreement it made. Why should that not be recognised in the costs? LORD JUSTICE SEDLEY: It (the appeal) succeeded but there is some lack of merits about it”[7]I deal first with the period before the acquiring authority’s sealed offer. The starting point is that the claimant should be awarded its costs unless there is a special reason for not doing so (see the recent analysis in Colneway Ltd v Environment Agency, ACQ/143/2002, unreported). As I have previously indicated, such a special reason is that the claim for loss of profits was pursued unreasonably. On the other hand, I consider that the behaviour of the acquiring authority, in allowing the claimants to enter into a contract on 4 November 1999 to acquire their relocation property and then waiting until the pre-trial review on 24 July 2001 before advising the claimants that it was withdrawing from the offer of £500,000 made on 12 March 1999 was justifiably described by the claimants as unmeritorious; it is another special reason which points in the opposite direction to the loss of profits claim. With those considerations in mind I see no reason to order the acquiring authority to pay the claimants less than their full costs incurred up to the date of the sealed offer.[8]For the period after the making of the sealed offer, since the compensation now agreed does not exceed the sum offered, the Tribunal must order the claimants to bear their own costs and pay the costs of the acquiring authority so far as they were incurred after the offer was made “unless for special reasons it thinks proper not to do so” (Land Compensation Act 1961, s4(1)(a)). In my judgment, the acquiring authority’s conduct in withdrawing its offer of £500,000 at a late stage is, again, a special reason justifying a departure from the general rule. Accordingly, the acquiring authority should not be entitled to recover its post sealed offer costs from the claimants.[9]I therefore order that the total compensation payable by the acquiring authority to the claimants shall be £498,945 and that the claimants shall recover from the acquiring authority their costs of the reference incurred up to the date of the sealed offer (14 August 2001). Such costs are to be agreed or, in default of agreement, assessed on the standard basis by the Registrar of the Lands Tribunal in accordance with the Civil Procedure Rules. Otherwise I make no order as to costs. Dated 11 November 2003 N J Rose FRICS 3