Decision Nº LRX 122 2010. Upper Tribunal (Lands Chamber), 23-02-2012
| Jurisdiction | UK Non-devolved |
| Judge | George Bartlett QC President |
| Date | 23 February 2012 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | LRX 122 2010 |
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UPPER TRIBUNAL (LANDS CHAMBER)
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UT Neutral citation number: [2012] UKUT 62 (LC)
UTLC Case Number: LRX/122/2010
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
LANDLORD AND TENANT – service charges – preliminary issues – LVT determining that application barred by estoppel and laches – decision founded on error of fact – appeal allowed
IN THE MATTER OF AN APPEAL AGAINST A DECISION
OF A LEASEHOLD VALUATION TRIBUNAL
and
55 ELGIN CRESCENT LIMITED Respondent
Re: Garden Flat
55 Elgin Crescent
Notting Hill
London W11 2JU
Before: The President
Sitting at 43-45 Bedford Square, London, WC1B 3AS
on 15 February 2012
Justin Bates instructed by Hockfield & Co for the appellant
The respondent did not appear
No cases are referred to in this decision.
The following cases were referred to in argument
Daejan Investments Ltd v Benson [2011] 1 WLR 2330
Majorstake Ltd v Curtis [2008] 1 AC 787
Paddington Basin Developments Ltd v West End Quay Estate Management Ltd [2010] 1 WLR 2735
Re Loftus [2007] 1 WLR 591
Collin v Duke of Westminster [1985] QB 581
Johnson v Moreton [1980] AC 37
DECISION
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The appellant is the long leaseholder of the Garden Flat, 55 Elgin Crescent, Notting Hill, London W11 2JU, a building that contains five flats. The respondent company, which is owned by the lessees of the other four flats, is the freeholder. There is a long and unsatisfactory history to the present appeal. The dispute underlying it arose as long ago as November 2004, when the appellant contested a service charge demand, saying that she was in credit as she had paid monies on account of certain works and those funds had not been exhausted. Eventually, after the parties had been unable to resolve this dispute, on 2 October 2008 the respondent issued proceedings in the Hitchin County Court. The appellant defended the claim on the basis that, inter alia, she was in credit. The proceedings were transferred to the Central London County Court and then on 6 April 2009 they were transferred to the leasehold valuation tribunal.
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The LVT held a pre-trial review on 27 May 2009, following which the tribunal gave directions. It identified the issues as follows:
“5. The Tribunal has identified the following issues to be determined: namely service charges from 2003 set out in an account annexed to the Defence and Counterclaim in the county court Action. These included an allegation that a TV installation was not within the terms of the lease, that there had been a failure to comply with Section 20 of the Landlord and tenant act in respect of major works and allegations of destruction of a waste water system.”
The tribunal directed that Ms Lawton should serve a statement covering a number of matters, including “(v) specifying as appropriate all breaches of Section 20 of the Landlord and Tenant Act 1985 on which the Respondent intends to rely”. (At a number of points the directions transposed “Applicant” and “Respondent”, but their meaning is clear.)
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The appellant, in accordance with the directions that were given, provided a statement of case. In this she said that on 25 July 2002 she had paid the respondent £13,702.52 as her 20% share of the cost of imminent major works. When the final account came for the works certain items, which she listed, had been charged against this advance payment, and she disputed her liability and requested that credit should be given for the itemised amounts. These totalled £4,655.73. In respect of two of the items, scaffolding and works to prevent damp ingress, she said that the requirements of section 20(4) of the 1985 Act had not been complied with in that two quotes for the works had not been served on the tenants. In respect of a third item, works to the top floor flat, she said that no alternative quotes had been served as required by section 20. These three items accounted for £3,815.90 of the total.
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The hearing was held on 17 and 18 August 2009. Ms Lawton appeared in person, and the company was represented by counsel. Somewhat surprisingly the tribunal (differently constituted from the one that had held the pre-trial review in May) decided that it was not concerned with the matters that Ms Lawton had raised in her defence and counterclaim in the county court action and in the statement of case that she had served pursuant to the directions given after the pre-trial review. Its decision included the following:
“13. The Tribunal considered that the application transferred to them by the county court related to the years 2007 and 2008 and that their jurisdiction was limited to consideration of the reasonableness of service charge costs in those years.”
14. The respondent did not dispute the validity of the service charges for these years and, indeed, at the conclusion of the hearing, she said that she would immediately pay them.
15. Accordingly the Tribunal determines the costs of £2,446.99 to be reasonable, reasonably incurred, and therefore payable.
16. The Tribunal indicated to the respondent that if she wished to pursue her claim in respect of the major works she should make her own application to the Leasehold Valuation Tribunal. In the absence of such an application the tribunal considers that it has no jurisdiction to consider the respondent’s defence, first raised in the county court.”
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Quite why the tribunal took the view that Ms Lawton was not able to raise the very matters which had constituted her defence and counterclaim in the proceedings that had been transferred to the LVT and which had been the subject of the LVT’s directions and Ms Lawton’s statement of case is not clear. But she wasted no time in following the tribunal’s advice and, on the second day of the hearing into what had been rendered an uncontested claim by the tribunal’s decision on its jurisdiction, she made the application which has led to the present proceedings. The application said that the year in question was that ending on 31 March 2004 and that the service charge items in dispute were major works carried out in 2002 and 2003. The questions she wished the tribunal to decide included “A Whether S20 procedures were satisfactorily carried out in reaspect of the entire contract”; and “B In the alternative whether S20 procedures were satisfactorily carried out in respect of sub-contracts within the works”.
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On 23 September 2009 the LVT held a pre-trial review. As at the previous substantive hearing Ms Lawton appeared in person and the company was represented by counsel. Two jurisdictional questions were raised by counsel: whether the application was time-barred under the Limitation Acts; and whether Ms Lawton was estopped from making all or part of her application due to her previous conduct in relation to the items in dispute. The tribunal directed that these two matters should be heard as preliminary issues, and it gave further directions dealing with statements of case and documentation.
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The preliminary issues were the subject of a hearing before another differently constituted tribunal on 1 February 2010, Ms Lawton representing herself and the company being represented by counsel, and the tribunal gave its decision on 18 March 2010. It rejected counsel’s contention that the claim was time-barred and a further contention that the LVT had no jurisdiction because by paying her service charge contribution in 2002 for the major works the charges were deemed to have been agreed or admitted by her. Counsel went on to submit that Ms Lawton was estopped from asserting that the company had failed to consult the lessees in accordance with the requirements of section 20 or alternatively that she was time-barred by the equitable principle of laches because...
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