Date Published 28 July 2026
Tribunal Orders Tenants to Pay Landlord's Costs After Justice for Tenants' RRO Claim Collapses
Case reference: LON/00BG/HMF/2025/0807 — First-tier Tribunal (Property Chamber), 19 Alderney Road, London E1 4EG
A recent First-tier Tribunal decision offers a timely reminder to landlords that a Rent Repayment Order (RRO) claim — even one brought with a specialist representative — can collapse under scrutiny, and that acting promptly and professionally in response can make all the difference.
What happened
Six tenants at a house in multiple occupation (HMO) in Bethnal Green applied for a Rent Repayment Order, seeking repayment of a full twelve months' rent (roughly £60,000 a year in total) on the basis that the property had been let without a valid HMO licence. The tenants were represented by Justice for Tenants, an organisation that specialises in bringing RRO claims and which, per the judgment, charges 36% of any sum recovered (30% plus VAT).
There was just one problem: the property had been properly licensed throughout the entire tenancy. The Tribunal found that the landlord held a valid HMO licence continuously from August 2021 through to August 2027 (via two consecutive licences), covering the whole of the tenants' occupation.
Faced with this, the tenants withdrew their RRO application in October 2025. The landlord then applied for its costs under Rule 13(1)(b) of the Tribunal Procedure Rules, on the basis that the claim had been pursued unreasonably.
The Tribunal's findings on Justice for Tenants' conduct
Applying the well-established three-stage test from Willow Court Management Company (1985) Ltd v Alexander, the Tribunal identified four separate examples of unreasonable conduct:
A defective initial enquiry. The letter Justice for Tenants sent to the local authority in November 2024 didn't actually ask the one question that mattered — whether a licence was in force throughout the relevant period — and the answers received were capable of being misread as showing a licensing gap.
An unexplained switch in position. By December 2024, Justice for Tenants had itself established that a prior licence existed, yet gave no evidence explaining why a claim was pursued regardless.
The "most egregious" example. Despite their own December 2024 advice that any claim would realistically cover a few months at most, Justice for Tenants issued a formal application in May 2025 claiming a full twelve months' rent — a claim the Tribunal found had no proper basis and no adequate explanation.
A settlement demand designed to pressure, not resolve. On the same day, Justice for Tenants wrote to the landlord demanding 85% of a year's rent to settle — well above the 40–60% typically seen in genuine RRO cases. The Tribunal did not accept this was a good-faith settlement position, finding instead that it was "made to intimidate the landlord, who had no legal advice at that point."
Taking these four points together, the Tribunal held there was "a very strong case" for a costs order and exercised its discretion to make one.
Acquire Estate Agents' role
Rather than trying to navigate a legal claim without support, the landlord instructed Acquire Estate Agents to help respond. Property manager Vinh Ta, who had relevant HMO experience, took on the work — outside Acquire's usual remit, but a sensible, proportionate step given the claim being made.
The Tribunal agreed. It described the landlord's decision to instruct Acquire as "wholly reasonable" and allowed the firm's costs (four hours at £50 per hour, plus VAT) in full. When the matter escalated to a contested hearing, the Tribunal likewise found it reasonable for the landlord to instruct counsel on a direct access basis, awarding those fees too.
Total costs awarded to the landlord: £3,240, to be paid by the tenants jointly and severally within 28 days.
Why this case matters for landlords
Rent Repayment Orders are a serious and legitimate remedy where a landlord has genuinely failed to license a property correctly — the law exists for good reason, and tenants are entitled to bring valid claims. But this case is a useful illustration of what can go wrong when a claim is pursued aggressively without the underlying facts being properly checked:
Licensing compliance is your best defence. The landlord in this case had done the paperwork correctly and kept the licences current — which is ultimately why the claim failed.
A rushed or poorly evidenced claim can expose the applicant to a costs order. Rule 13(1)(b) exists precisely for situations like this, and the Tribunal was willing to use it.
Getting experienced help early pays off. The landlord's choice to bring in a property manager with genuine HMO expertise, rather than trying to respond alone, was specifically endorsed by the Tribunal — and its cost was recovered in full.
If you're a landlord facing an RRO claim, or you simply want to make sure your HMO licensing is watertight before a claim ever arises, Acquire Estate Agents can help — from licence renewals and compliance checks to representation if a dispute does end up before the Tribunal.
This article summarises the Tribunal's published decision (LON/00BG/HMF/2025/0807, 10 July 2026) and is provided for general information. It is not legal advice.
