Six tenants in Tower Hamlets, East London, have been hit with a substantial bill after their rent repayment order (RRO) claim was thrown out. The First-tier Tribunal found they had engaged in 'unreasonable conduct', leading to a £3,240 costs award against them.
The tenants had sought £60,000 – representing 12 months' worth of rent – over an alleged licensing issue at their House in Multiple Occupation (HMO). However, the tribunal ruled that the property was continuously licensed throughout their tenancy, with evidence showing one licence covered August 2021 to August 2024 and another ran from August 2024 to August 2027.
Justice for Tenants had initially suggested a possible claim for two months' rent due to a perceived gap in licensing. But they went on to submit an application seeking the full £60,000 repayment, which judges deemed 'the most egregious example' of unreasonable behaviour. On the same day, they made an offer to settle for 85% of the annual rent – a move criticised by the tribunal as an attempt to intimidate their landlord, who was unrepresented.
The tenants withdrew their claim in October 2025, but the landlord, VHGK Limited, successfully applied for costs under tribunal rules. The judges cited several instances of unreasonable conduct, including a defective request for licensing information and an unexplained belief that no licence existed for a specific period.
The awarded costs included £240 for Acquire Estate Agents, who initially handled the claim on behalf of the landlord, as well as a further £3,000 for legal counsel instructed to represent them at the oral costs hearing. This ruling serves as a warning to tenants and their representatives: pursuing speculative or poorly investigated RRO claims can lead to costly consequences.