Decision Nº LRX 11 2013. Upper Tribunal (Lands Chamber), 28-11-2013

JurisdictionUK Non-devolved
JudgeMrs McGrath, Siobhan First-tier Tribunal (Property Chamber)
Date28 November 2013
CourtUpper Tribunal (Lands Chamber)
Judgement NumberLRX 11 2013
TRIPLEROSE LIMITED –v- GRANTGLEN LIMITED AND CANE DEVELOPMENTS LIMITED

UPPER TRIBUNAL (LANDS CHAMBER)



UT Neutral citation number: [2013] UKUT 0606 (LC)

UTLC Case Number: LRX/11/2013

LRX/92/2013

LRX/99/2013

LRX/182/2011


TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007


LANDLORD AND TENANT – Right to Manage – whether a single RTM company can exercise the right in respect of more than one set of premises – whether separate claim notices are required – whether qualifying conditions in section 72 of the Commonhold and Leasehold Reform Act 2002 must be met in respect of each set of premises



IN THE MATTER OF THREE APPEALS AGAINST DECISIONS

OF THE LEASEHOLD VALUATION TRIBUNAL FOR THE

EASTERN AND MIDLAND RENT ASSESSMENT PANELS


AND IN THE MATTER OF AN APPLICATION TRANSFERRED TO THE UPPER TRIBUNAL (LANDS) CHAMBER PURSUANT TO RULE 25 OF THE TRIBUNAL PROCEDURE (FIRST-TIER TRIBUNAL)(PROPERTY CHAMBER) RULES 2013


BETWEEN:


NINETY BROOMFIELD ROAD RTM COMPANY LTD Appellant

and

TRIPLEROSE LTD Respondent

LRX/11/2013





GARNER COURT RTM COMPANY LTD Appellant

and

FREEHOLD MANAGERS (NOMINEES) LTD Respondent

LRX/92/2013



HOLYBROOK RTM COMPANY LTD Applicant

and

PROXIMA GR PROPERTIES LTD Respondent

LRX/99/2013



SINCLAIR GARDENS INVESTMENTS (KENSINGTON) LTD Appellant

and

4-44 APPERLEY WAY Respondent

LRX/182/2011



Re: Flats 1 to 15 Farthing Court,

90 Broomfield Road,

Chelmsford, Essex CM1 1SS


Flats 1-48 Garner Court (Block 2)

and flats 49-68 Garner Court (Block 2)

Dock Road,

Tilbury,

Essex

RM18 7BJ (Block 1)


New Bright Street and others,

Reading,

Berkshire

RG1 6QQ


14-44 Apperley Way & 18-44 Pippen Avenue

Halesowen

West Midlands

B63 2PN/2PW

2-24 Netherend Lane & 192-210 Apperley Way

Halesowen

West Midlands

B63 2PU/2YA


………………………..




Before: Siobhan McGrath, Chamber President – First-tier Tribunal (Property Chamber) sitting as a Judge of the Upper Tribunal (Lands Chamber)


Sitting at: 10 Alfred Place, London

WC1E 7LR

on 17 October 2013

LRX/11/2013

Mr A Drane for the appellant

Mr J Bates counsel for the respondent



LRX/92/2013

Mr S Woolf counsel for the appellant

Mr J Bates counsel for the respondent


LRX/99/2013

Mr Phil Perry for the appellant

Mr J Bates counsel for the respondent


LRX/182/2011

Mr O Radley-Gardner counsel for the appellant

Mr S Woolf counsel for the Respondent


© CROWN COPYRIGHT 2013


The following cases are referred to in this decision:

Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenberg AG[1975] A.C. 591

Bredon Court (Newquay) RTM Company Ltd v Wel (No 1) Ltd /00HE/LRM/2012/0020)

Gala Unity Ltd v Ariadne Road RTM Company Ltd [2011] UKUT 425 (LC); [2012] EWCA Civ 1372

Craftrule Ltd v 41-60 Albert Place Mansions (Freehold) Limited [2011] EWCA Civ 185.

Scrivens v Ethical Standards Officer [2005] EWHC 529

Longacre Securities Ltd v Karet [2005] 4 ER 413

Cawsand Fort Management Ltd v Stafford (LRX/145/2005)

Decision

Introduction

  1. The common issue in these cases is whether the Right to Manage (RTM) contained in Chapter 1 of Part 2 of the Commonhold and Leasehold Reform Act 2002 may be exercised by a single RTM company in respect of more than one self-contained building.

  2. It had been directed that this issue, which arises in three appeals and one application transferred to the Upper Tribunal under rule 25 of the Tribunal Procedure (First-tier Tribunal)(Property Chamber) Rules 2013, should be dealt with together and a hearing for this purpose was convened on 17 October 2013.

  3. For ease of reference in this decision, the cases will be referred to as follows: the appeal in Ninety Broomfield Road RTM Company Ltd v Triplerose Ltd, will be referred to as “Ninety Broomfield Road”; the appeal in Garner Court RTM Company Ltd v Freehold Managers (Nominees) Limited will be referred to as “Garner Court”; the application transferred from the First-tier Tribunal in Holybrook RTM Company Ltd v Proxima GR Properties Ltd will be referred to as “Holybrook” and the appeals in Sinclair Gardens Investments (Kensington) Ltd v 14-44 Apperley Way and 18-44 Pippen Avenue Halesowen Right to Manage Company and another, will be referred to as “Apperley Way”.

  4. The applicant in the Holybrook transferred case is the RTM company; each appellant in the Garner Court and Ninety Broomfield Road cases is the RTM company and the appellant in the Apperley Way case is the freeholder. At the hearing the freeholders in 90 Broomfield Road, Holybrook and Garner Court cases were represented by Mr Justin Bates of counsel and the freeholder in Apperley Way was represented by Mr Oliver Radley-Gardner of counsel. The RTM companies in Garner Court and Apperley Way were represented by Mr Steven Woolf of counsel; Mr Andrew Drane represented the RTM company in Ninety Broomfield Road and Mr Phil Perry assisted by Mr John Mortimer represented the RTM company in Holybrook.

  5. In addition to the oral submissions made at the hearing, skeleton arguments had been submitted by or on behalf of each party together with a bundle of relevant documents for each case.

Background to the Right to Manage

  1. Before moving on to consider the statutory provisions and the submissions in these cases, it is worth considering the context for the Right to Manage. Shortly before the hearing commenced, Mr Radley-Garnder produced copies of the Draft Bill and Consultation Paper which preceded the Commonhold and Leasehold Reform Act 2002. No objection was made to my having regard to the report and I was satisfied that it was appropriate to do so (see Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenberg AG [1975] A.C. 591).

  2. Section 3 of the report provides details of proposals included in the draft bill for leasehold reform. The proposed right to manage is dealt with from page 115 of the report. In the introduction to section 3, the problems with the existing regime were described as follows:

“Although long leaseholders in flats have purchased the right to live in their property, control of the management, maintenance and insurance of the property normally remains in the hands of the landlord. The leaseholders are normally obliged under their leases to meet the full costs of the landlord’s functions, but enjoy little control over the quality, value for money or promptness of those services. The Government believes that the landlord’s monopoly over the supply of the services in the property is not justified. In most cases, the financial value of the landlord’s interest in the building is very small in comparison with that of the leaseholders.”

  1. At paragraph 9 the broad policy for the proposed measure were set out:

“The Government therefore considers that a new right is required to allow leaseholders to take over responsibility for the day to day management of the block in which they live…”

And at paragraph 10 the overall objective of the proposals can be found as being:

“The main objective is to grant residential long leaseholders of flats the right to take over the management of their building collectively without having either to prove fault on the part of the landlord or to pay any compensation. The procedures should be as simple as possible to reduce the potential for challenge by an obstructive landlord. The allocation of responsibilities should be clear-cut and the body through which the leaseholders take on management responsibility should enjoy all necessary powers to properly discharge its functions. At the same time, the legitimate interest of the landlord in the property should be properly recognised and safeguarded.”

  1. I deal with the statutory provisions in detail below, but by way of overview, section 72(1) of the Act provides that the right to manage applies to premises if: they consist of a self-contained building or part of a building, with or without appurtenant property; they contain two or more flats held by qualifying tenants, and the total number of flats held by such tenants is not less than two-thirds of the total number of flats contained in the premises. By subsection (2), a building is a self-contained building if it is structurally detached.

  2. Section 79(1) provides that a claim to acquire the right to manage any premises is made by giving notice of the claim; and under section 80(2) the claim notice “must specify the premises and contain a statement of the grounds on which it is claimed that they are premises to which this Chapter applies.” Section 79(1) specifies the persons to whom the claim notice must be given. They include the landlord under a lease of the whole or part of the premises. A person who is given a claim notice may give to the RTM company a counter-notice (section 84(1)); and under section 84(2) a counter-notice either admits the right of the RTM company to acquire the right to manage the premises or alleges that, by reason of a specified provision of the Chapter, the RTM company was not on the relevant date (the date of the claim notice: see section 79(1)) entitled to acquire such right. If the latter, the company may apply to an LVT for a determination that it was on the relevant date entitled to acquire the right to manage the premises (section 84(3)); and it will acquire the right to manage the premises if and when...

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