Decision Nº LRX 61 2012. Upper Tribunal (Lands Chamber), 05-07-2013
| Jurisdiction | UK Non-devolved |
| Judge | Sir Keith Lindblom, President |
| Date | 05 July 2013 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | LRX 61 2012 |
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UPPER TRIBUNAL (LANDS CHAMBER)
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UT Neutral citation number: [2013] UKUT 0213 (LC)
UTLC Case Number: LRX/61/2012
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
LANDLORD AND TENANT – Right to manage – giving of notice of invitation to participate – sections 78 and 111 of the Commonhold and Leasehold Reform Act 2002 – second claim notice – section 81(3)
IN THE MATTER OF AN APPEAL AGAINST A DECISION
OF A LEASEHOLD VALUATION TRIBUNAL FOR THE
SOUTHERN RENT ASSESSMENT PANEL
and
REGENT COURT RTM CO LIMITED Respondent
Re: Regent Court,
Regent Street,
Plymouth,
Devon
PL4 8BD
Before: The President, Sir Keith Lindblom
Sitting at 43-45 Bedford Square, London WC1B 3DN
on 17 April 2013
Mr Justin Bates, instructed by Conway & Co, solicitors for the appellant
Mrs Margarita Mossop, instructed by Mayfield Law Ltd, solicitors for the respondent
© CROWN COPYRIGHT 2013
The following cases are referred to in this decision:
Plintal SA v 36-48A Edgwood Drive Co Ltd LRX/16/2007
Petch v Gurney [1994] 3 All E.R. 731
Howard v Bodington (1877) 2 P.D. 203
London and Clydeside Estates Ltd v Aberdeen DC [1980] 1 W.L.R. 182
R v Immigration Appeal Tribunal, ex parte Jeyeanthan [1999] 3 All E.R. 231
Brayhead (Ascot) Ltd v Berkshire CC [1964] 2 Q.B. 303
7 Strathray Gardens Ltd. v Pointstar Shipping & Finance Ltd. [2004] EWCA Civ 1669
R v Soneji [2006] 1 A.C. 340
Sinclair Gardens Investments (Kensington) Ltd v Oak Investments RTM Co. Ltd. (LRX/52/2004)
Sinclair Gardens Investments (Kensington) Ltd. v Poets Chase Freehold Co. Ltd. [2007] EWHC 1776 (Ch)
9 Cornwall Crescent London Ltd v Kensington and Chelsea Royal London Borough Council [2006] 1 W.L.R. 1186
Alleyn Court RTM Co Ltd v Abou-Hamdan [2012] UKUT 74 (LC)
DECISION
Introduction
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This is an appeal, by way of review, against the decision of the Leasehold Valuation Tribunal for the Southern Rent Assessment Panel (“the LVT”), issued on 13 February 2012, on applications made under sections 84 and 88 of the Commonhold and Leasehold Reform Act 2002 (“the 2002 Act”). The building to which those applications related is a block of flats called Regent Court, in Regent Street, Plymouth. In the first application the respondent in the appeal, Regent Court RTM Co. Ltd., sought a determination under section 84(3) of the 2002 Act that on the relevant date it was entitled to acquire the right to manage the building. The second application was made by the appellant, Avon Freeholds Ltd, seeking a determination under section 88 of the costs to be paid to it. The LVT decided that the respondent was entitled to acquire the right to manage.
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Permission to appeal has been granted on two grounds, which are:
(1) that the LVT erred in its conclusion that the respondent’s failure to serve all qualifying tenants with a notice of invitation to participate was not fatal to the right to manage claim because the requirement to serve a notice of invitation was directory, rather than mandatory, and the claim could survive if insufficient prejudice had been caused;
and
(2) that the LVT erred in concluding that the first claim notice served by the respondent was no bar to the service of the second claim notice.
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The LVT itself granted permission on the first ground, on 6 March 2012. Permission on the second ground was refused by the LVT, but was granted, on 18 May 2012, by the Tribunal (George Bartlett Q.C., President). In granting permission the Tribunal observed that it was likely that the appeal would fail, but that in view of the observations made in Plintal SA v 36-48A Edgwood Drive Co Ltd (LRX/16/2007) and the fact that permission to appeal had been given on the other ground, it was appropriate that permission should be granted on this ground, too.
The facts
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The parties agreed a statement of facts and issues for the hearing of the appeal. From that document I take the following history as the factual basis for my decision.
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On 27 January 2011, the respondent gave notice inviting participation under section 78 of the 2002 Act to the non-participating qualifying tenants of the building. The respondent attempted to serve notices on all but three of the relevant registered owners of flats in the building. The three were Mr Bethell, Mr King and Mr Benoy. According to the proprietorship register shown on current office copy entries, each of them was the joint registered proprietor of his flat. However, all three had died by the time the notices were served. Their widows and joint owners were all members of the respondent as the RTM company when notice was given to the other tenants.
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For the registered non-participating owners of two of the flats, Ms Phyllis Cornforth and The Capital Appreciation Trust Limited (the tenants of flat 14) and Mr Alan Chapman and Mr Colin Chapman (the tenants of flat 16), the notice inviting participation was not given at their flats in Regent Court. Instead it was served elsewhere, at the addresses recorded on the Proprietorship Register at the Land Registry. When notice was given, Ms Cornforth was a member of the respondent.
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On 11 February 2011 the respondent issued a notice of claim, bearing that date, which stated at paragraph 5 that the landlord may respond to the notice by giving a counter-notice under section 84 of the 2002 Act “not later than 11 March 2011”.
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The appellant gave a counter-notice dated 9 March 2011, in which it denied that the respondent was entitled to acquire the right to manage because “the claim notice specified a date earlier than one month after the relevant date for response by counter-notice under section 84 …”.
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On 17 March 2011 the respondent served a second notice of claim. The covering letter to this notice had a date stamp recording the date on which the appellant received the notice as 18 March 2011. The covering letter stated:
“… [We] acknowledge that the original Claim Notice is not a valid notice for reasons stated in the Counter-Notice. … As the previous Claim Notice was invalid please find enclosed a fresh Claim Notice addressing this issue. Given that no other objections were raised I await confirmation that RTM will be determined on 21st April 2011, with an Acquisition date of 21st July 2011.”
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On 18 March 2011 the respondent sent a letter to all leaseholders, in which it stated:
“You may already be aware that on receipt of the original Claim Notice, the solicitors acting on behalf of Avon Freeholds issued a Counter-Notice, due to a typing error in the original Notice.
The date for response to the claim with a Counter-Notice should have in fact been the 13th and not the 11th March 2011. We have therefore acknowledged that the original Claim Notice is not a valid notice and issued a fresh Claim Notice, as enclosed.
…”.
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By a counter-notice dated 18 April 2011, the appellant denied that the respondent was entitled to acquire the right to manage, for two reasons: first, “because at the date the claim notice was given an earlier claim notice remained in force”; and secondly, “because at the date the claim notice was given each person required was not served with a notice of invitation to participate at least 14 days before”.
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On 16 June 2011 the respondent began proceedings before the LVT seeking a determination that it was entitled to acquire the right to manage.
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As to the alleged failure to serve a notice of invitation to participate, the LVT decided: first, that there was no requirement to serve a notice of invitation to participate on Mr Bethell, Mr King, or Mr Benoy (paragraphs 25 and 26 of the decision) and that in any event no prejudice had been caused by the failure to serve such a notice on them because in each case the surviving spouse was already a member of the respondent as the RTM company (paragraph 27); secondly, that there had been no requirement to serve one of the two non-participating tenants (the tenant of flat 14) as it was not necessary to serve both joint tenants individually and she had, in fact, applied on behalf of herself and her joint tenant to become a participating tenant (paragraph 30); and thirdly, as to the other non-participating tenants (the tenants of flat 16), the respondent as the RTM company had not shown that the notice of invitation to participate had been served (paragraph 35) but this failure was not such as to vitiate the right to manage process (paragraphs 31 to 37).
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As to the appellant’s argument that the first claim notice was still in force when the second was served, the LVT decided that the first claim notice was invalid and did not prevent the second claim notice being given, as a valid notice (paragraph 48 of the LVT’s...
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