Decision Nº LRX 128 2010. Upper Tribunal (Lands Chamber), 07-03-2012
| Jurisdiction | UK Non-devolved |
| Judge | Her Honour Judge Walden-Smith |
| Date | 07 March 2012 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | LRX 128 2010 |
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UPPER TRIBUNAL (LANDS CHAMBER)
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UT Neutral citation number: [2012] UKUT 74 (LC)
UTLC Case Number: LRX/128/2010
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
LANDLORD AND TENANT– right to manage – construction of terms of legal charge – right to serve counter-notice under the right to manage legislation – necessity to withdraw earlier notice – whether earlier notice invalid by failure to serve copy on qualifying tenants – appeal dismissed
IN THE MATTER OF AN APPEAL AGAINST A DECISION
OF THE LEASEHOLD VALUATION TRIBUNAL
FOR THE LONDON RENT ASSESSMENT PANEL
and
MICHA’AL ABOU-HAMDAN Respondent
Re: Alleyn Court,
123 Sussex Gardens
London W2 2RA
Before: Her Honour Judge Walden-Smith
Sitting at: 43-45 Bedford Square, London WC1B 3AS
on
28 February 2012
Amanda Eillidge instructed by William Heath & Co on behalf of the Appellant
Stan Gallagher instructed by way of public access on behalf of the Respondent
The following cases are referred to in this decision:
Sinclair Gardens Investments (Kensington) Limited v Oak Investments RTM Company Limited LRX/52/2004,
R v Immigration Appeal Tribunal, ex parte Jeyeanthan [1999] 3 All ER 231.
9 Cornwall Crescent Ltd v Kensington LBC [2006] 1 WLR 1186
Poets Chase Freehold Co Ltd v Sinclair Gardens Investments (Kensington) Ltd [2008] 1 WLR 768.
DECISION
Introduction
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This is an appeal by way of review from the decision of the Leasehold Valuation Tribunal for the London Rent Assessment Panel dated 19 August 2010. Permission to appeal was refused by the LVT but granted by the President on 15 December 2010. In granting permission to appeal, the President made the observations that each of the three grounds raised is reasonably arguable.
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The three grounds raised in the Appellant’s statement of case are:
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that, upon the true construction of the mortgage deed, the Respondent was not authorised to serve a counter-notice on behalf of the headlessees;
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that the First Notice was not a valid notice and therefore did not need to be withdrawn prior to the service of the Second Notice;
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that the Second Notice was valid as the requirement to serve a notice of invitation to participate could be dispensed with and ought to have been in the circumstances of the case.
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I have been assisted in this case by the focused oral and written submissions from Counsel on behalf of the Appellant and Counsel on behalf of the Respondent.
Preliminary Matters
Requirement for an additional Respondent
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An issue was raised in the papers before me as to whether there is any necessity to add Nawal Abou-Hamdan as an additional Respondent to the proceedings as she was registered as the freehold owner of Alleyn Court, 123 Sussex Gardens, London W2 2RZ (“Alleyn Court”) on 8 June 2011. It was agreed between the parties and endorsed by me that there was no requirement to add Nawal Abou-Hamdan. The decision is made in rem and she will be bound by the decision in any event.
The Third Ground of Appeal
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The third ground of appeal has been conceded by the Respondent. It is accepted that the requirement to serve on the tenant of flat 24, Alleyn Court a Notice of Invitation to Participate as is set out in section 78 of the Commonhold and Leasehold Reform Act 2002 (“the 2002 Act”) is not mandatory and that it could properly have been dispensed with unless there was prejudice suffered by Mr Hamidi and Miss Journo. Reliance is placed upon Sinclair Gardens Investments (Kensington) Limited v Oak Investments RTM Company Limited LRX/52/2004, a decision of the President made under the written representations procedure in which he applied the principles enunciated by Lord Woolf MR in R v Immigration Appeal Tribunal, ex parte Jeyeanthan [1999] 3 All ER 231.
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It is accepted by the Respondent that there was no such prejudice so that the Notice of Invitation to Participate should properly have been dispensed with. However, the concession on ground 3 of the appeal does not dispose of the appeal. The Second Notice is only effective if the Appellant succeeds on establishing that there was no requirement to withdraw the First Notice on the basis that it was invalid.
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In order to succeed on the Appeal, the Appellant has to succeed on ground 1 (did Mr Hamdan have authority to serve a counter-notice); or ground 2 (was the Second Notice invalid because the First Notice was valid and had not been withdrawn prior to the service of the Second Notice). This is an appeal by way of review.
The Inherent Jurisdiction of the High Court
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The Respondent’s Counsel contends that if the Respondent is found not to be competent to serve a counter-notice then the LVT (and by extension the Tribunal) could not declare that the Appellant had acquired the right to manage under the 2002 Act as the LVT’s jurisdiction is dependent upon the service of a negative counter-notice by virtue of the provisions of section 84(3) of the 2002 Act. In which case, he argues, the issue of entitlement to acquire a right to manage under the 2002 Act would fall to be adjudicated by the High Court under its inherent jurisdiction.
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I cannot say that I agree with this proposition as section 90 of the 2002 Act provides the date which is the acquisition date where a RTM company acquires the right to manage any premises. It provides that where there is no dispute about entitlement, the acquisition date is the date specified in the claim notice under section 80 (7) and that there is no dispute about entitlement if no counter-notice is given under section 84 (see section 90(3)(a)) or the counter-notice or (where more than one is so given) each of them, contains a statement admitting that the RTM company was on the relevant date entitled to acquire the right to manage the premises specified in the claim notice (see section 90(3)(b) and section 84(2)(a)).
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In any event, I was informed by both Counsel at the commencement of the hearing that it was not a matter that I need concern myself with.
The Background
The Application to the LVT
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An application was made to the leasehold valuation tribunal by the Appellant, Alleyn Court RTM Company Limited, pursuant to the provisions of section 84(3) of the 2002 Act for a determination that it was, on the relevant date, entitled to acquire the right to manage Alleyn Court.
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The hearing was spread over 3 days: 26 April 2010 and 7 and 11 June 2010. On 26 April, the Respondent was represented by Mr J O’Mahoney and by Mr Gallagher on the June dates. Mr Gallagher appears on the appeal on behalf of the Respondent. Mr Fleming, of the solicitors William Heath & Co appeared throughout on behalf of the Appellant before the LVT and he has instructed Ms Eillidge to appear at the Upper Tribunal (Lands Chamber) (hereinafter referred to as “the Tribunal”).
The Property
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At the time of the application to the LVT, Alleyn Court comprised 24 flats. 23 of the flats had already been let on long leases and, on 6 November 2009, a long lease of the basement flat, flat 24, was created. This long lease was registered at the Land Registry on 15 April 2010 under title number NGL9010087.
The Respective Interests in the Property
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The freehold interest in Alleyn Court is owned by the Church Commissioners for England; the headlease was registered in the joint names of Mr Aboo Reyhana and Miss Michelle Journo (“the Headlessees”) with Miss Journo holding her legal interest as nominee for Mr Hamidi, who was himself made bankrupt on 11 February 2009. As I have noted above Namal Abou-Hamdan became the registered headlessee of Alleyn Court on 8 June 2011.
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Pursuant to a mortgage deed dated 30 November 2005 (“the mortgage”), the Respondent is the registered mortgagee of the headlease. He obtained possession of the headlease by an order made by consent on 6 February 2008.
Validity of the Claim Notice (the second ground of appeal)
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A claim notice was served by the Appellant on 9 December 2009 (“the First Claim Notice”) pursuant to the provisions of section 79 of the 2002 Act. The Appellant subsequently considered that the First Notice was invalid as it had not been given in accordance with the provisions of section 79 of the 2002 Act (as copies had not been given to any of the qualifying tenants in accordance with the provisions of section 79(8) of the 2002 Act).
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The Appellant served a second claim notice on 15 December 2009 (“the Second Claim Notice”). The Second Claim Notice was in identical form as the First Claim Notice. Copies of the Second Claim Notice were served upon the qualifying tenants in accordance with the provisions of section 79(8) of the 2002 Act.
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The Respondent contends that the Appellant’s...
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