The vexed question of how best to resolve disputes between landlords and tenants has come to the fore again following the recent Land Court rent review case involving Mr J Elliot and Roxburghe Estates to fix the rent from May 2009.
This case was decided last month, five years after the review date and after incurring legal costs reported as being more than £100,000.
The original rent proposed by the landlord was £38,300, and the tenant originally proposed it remain at £27,500.
The Land Court assessed the rent should be £48,982.
The parties were only £10,800 apart at the start and, with hindsight, was it worth spending five years albeit part of that time the case was on hold pending the outcome of the Moonzie rent review case and incurring the costs involved?
Would it have been simpler and easier to have met half way and saved time, money, uncertainty and emotional cost to those involved?
However, these things are seldom as simple as they may appear from the outside, and no doubt there were good reasons for going down the route they did.
There are calls for a quicker, better and cheaper way of resolving disputes; for example, to have some sort of independent ‘ombudsman’ type individual or body to deal with landlord/tenant disputes and to fix rents.
A good potential alternative which is already in place is the SAAVA quick arbitration procedure, although it is not clear how much this has been used so far.
The default position in the legislation is that disputes have to be determined by the Land Court unless in the case of some (but not all disputes) the parties agree to go to arbitration instead. In this context arbitration includes not only an arbitration, for example under SAAVA’s auspices, but any other method of resolving the matter which could include mediation or reference to an expert.
Other ways of resolving most disputes already exist if the parties want to choose them. The problem is that often they don’t, as relations have broken down and they can’t agree to one of the alternatives to the Land Court. The Land Court is seen, perhaps unfairly, as expensive and slow.
The Land Court of itself is not expensive. Application fees are low (£100 or less), and the court room charge is £120 a day. It is the cost of having professional representation which increases the expense, although there is nothing to stop parties representing themselves and some do, quite successfully.
The difficulty with any method of dispute resolution is that the facts have to be presented by each side; these may not be agreed by the parties, far less whether the claim is justified in law or not.
If a hearing is required (rather than written submissions) and if the facts and law are disputed, then each side has to get a fair chance to put their case.
Once a decision is made, should there be a right of appeal?
Most people would want to have that right in case the decision-maker just gets the decision plain wrong, and that does happen.
So, it becomes clear that whatever forum either currently exists, or new forum is put in place to resolve disputes in the future, there is the risk that the cost and time spent in the preparation, presentation and possible appeal of a case will still be high.
It is difficult to see how that can be avoided unless, for example, limits are put in place to reduce the amount of paperwork which can be submitted, the time allowed for presentation of a case, and appeals are only allowed in very few situations.
If there is a complicated dispute, would a truncated procedure satisfy the parties that at the end of the day justice had been done?
As we have seen before, simply changing the forum where the dispute is determined doesn’t necessarily solve the problem of cost and delay.
Having said that, if a quicker, easier and cheaper way of resolving disputes can be found, I’m sure it would be welcomed by all sides.
* Colin Clark is a partner with solicitors Pagan Osborne in the Cupar office.