R (Sinclair Investments (Kensington) Ltd) v The Lands Tribunal
| Jurisdiction | England & Wales |
| Judge | Lord Justice Neuberger,Lord Justice Laws,Lord Justice Auld |
| Judgment Date | 08 November 2005 |
| Neutral Citation | [2005] EWCA Civ 1305 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: C3/2004/2080 |
| Date | 08 November 2005 |
[2005] EWCA Civ 1305
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION (Administrative Court)
Mr Justice Sullivan
CO342004
Lord Justice Auld
Lord Justice Laws and
Lord Justice Neuberger
Case No: C3/2004/2080
Mr Paul Letman (instructed by Messrs P Chevalier & Co) for the Appellant
Mr Jonathan Karas (instructed by the Treasury Solicitor) as Advocate to the Court
This is an appeal, brought with leave of the Judge, by Sinclair Gardens (Kensington) Ltd ("Sinclair") from a decision of Sullivan J, rejecting an application for judicial review of the Lands Tribunal's refusal to grant permission to appeal against a determination of a Leasehold Valuation Tribunal (an "LVT"). The appeal raises two points. The first concerns the proper approach for the High Court to adopt to an application for judicial review of a refusal by the Lands Tribunal to grant permission to appeal from a determination of the LVT. The second point involves the application of that approach to the facts of this case. I shall first set out the facts; then I shall turn to the relevant statutory scheme; I shall then deal with the two points raised by this appeal.
The Facts
Sinclair is the freehold owner of 75 Eardley Crescent, London SW5 ("the building"), a four storey house, which has been converted into six flats, each of which is subject to a long lease containing service charge provisions in Clause 3(3). Those provisions require the tenant to pay "one-sixth of the expenses incurred by the lessor of performing its obligations contained or referred to in Clause 5(c) hereof …". Clause 5(c) is a covenant by the lessor, Sinclair:
"to maintain amend renew replace and at all times during the…term to keep in good and substantial repair cleansed and decorated the whole of the building…including…the roof structure and foundations…and to do all such acts matters and things as may in the lessor's reasonable discretion be necessary or advisable for the proper maintenance or administration…of the building".
The service charges levied by Sinclair for the four years ending 24 th June 1999, 2000, 2001 and 2002, and the service charge estimate for the year ending 24 th June 2003, were challenged by two tenants, Ms Manuela da Graca and Mr Timothy O'Keefe ("the tenants"). Their challenge was made by way of application to the LVT pursuant to the provisions of section 19(2A) of the Landlord and Tenant Act 1985 (as amended by the Housing Act 1996) ("the 1985 Act"). The application was heard by the LVT over some four days during March and April 2003. On 3 rd June 2003, the LVT published its determination, allowing certain items claimed by Sinclair, and disallowing others. The only relevant item for present purposes was the cost of carrying out damp proofing works ("the works"), some of which was disallowed.
The works consisted of the provision of a chemical damp proof course, and consequential replastering and water-proof rendering (or tanking) in two areas of the building. The works were carried out (i) to some of the walls of the basement flat, and (ii) to some of the walls of the basement flat access lobby. In the written and oral argument advanced by Counsel on behalf of Sinclair before the LVT, it was contended that, in the light of the expert evidence called by Sinclair, the practical justification for the works, Clauses 3(3) and 5(c) of the leases, and the guidance given in certain cases, the cost of all the works was the liability of the tenants. The tenants, who appeared in person before the LVT, disagreed.
In paragraph [32] of their determination, the LVT accepted that there must have been some damp proofing work to the basement flat when the building was converted into flats in the 1980's, and that that damp proofing had failed. Accordingly, they concluded that the damp proofing and associated works to the walls of that flat constituted repairs falling within clause 5(c) of the leases, and that Sinclair could therefore recover the cost under clause 3(3).
In paragraph [33] of their determination, the LVT said they were unpersuaded that "the same standard would, automatically, have been applied to the access lobby", and that they were "of the opinion that the damp proofing of the access lobby to the standard achieved constituted an improvement rather than a repair". They therefore held that the damp proofing and associated works to the access lobby fell outside the scope of clause 5(c) of the leases, and that the cost could not be recovered by Sinclair under clause 3(3).
Accordingly they allowed the cost of the works to the walls of the basement flat, but disallowed the cost of those to the walls of the access lobby. In paragraph [34], they said that they were not "greatly assisted by the legal arguments put forward on behalf of both parties". This was, they explained, because "on the facts of this case" they believed that "a clear distinction between repairs and improvements could and should have been drawn". In round figures, this meant that about £10,000, which Sinclair sought to recover by way of service charges as the cost of the work to the access lobby, was disallowed.
Sinclair requested permission from the LVT to appeal on this aspect of their determination (as well as on other aspects) to the Lands Tribunal. This request, which was made by way of a written reasoned application on 18 th June 2003, was rejected by the LVT, essentially because they thought they were right, in a short written refusal dated 10 th July 2003.
On 26 th July 2003, Sinclair applied to the Lands Tribunal for permission to appeal. That application, which was also made in writing, set out the proposed grounds of appeal, and annexed the written evidence given to the LVT on the works, the legal submissions made to the LVT, the determination of the LVT, and the application to, and decision of, the LVT on permission to appeal. Essentially, there were two proposed grounds of appeal, so far as relevant. The first was that the LVT had failed to focus on, and to apply, the words of Clause 5(c), treating it simply as a covenant to repair, whereas it was more extensive than that. Secondly, even if the clause was simply a covenant to repair, that the nature of all the damp proofing and associated work was such that it constituted a repair.
On 2 nd December 2003, Mr N J Rose FRICS, a surveyor member of the Lands Tribunal, refused permission to appeal in a short written determination expressed in these terms:
"The conclusions of the Leasehold Valuation Tribunal on the issues about which the applicant complains are ones which it reasonably could have reached. In the light of the submissions which have been made by the parties there are no reasonable grounds for concluding that the decision may have been wrong."
Sinclair was dissatisfied with this decision. The only conceivably available route to challenge the determination of the LVT was to seek judicial review of Mr Rose's refusal to grant permission to appeal that determination. Accordingly, on 6 th January 2004, Sinclair applied for permission to issue an application for judicial review. Permission to issue was granted by Collins J on 23 rd February 2004. In reply to the application, the Lands Tribunal wrote querying the availability of a judicial review remedy in principle, and stating that, if such a remedy was available, an "active respon[se]" would be "inappropriate".
The application for judicial review came on before Sullivan J. In a reserved judgment, he reached two conclusions of principle. First, he decided, contrary to the written suggestion of the Lands Tribunal, that the right of appeal to the Court of Appeal, generally available on a point of law to a disappointed party in the Lands Tribunal, did not extend to a party who had been refused permission by the Lands Tribunal to appeal from the LVT. However, his second conclusion was that, whatever the merits of Sinclair's criticisms of Mr Rose's refusal to grant permission to appeal to the Lands Tribunal, the application for judicial review could only succeed in exceptional circumstances.
In reaching this second conclusion, Sullivan J held that, in an application such as this, judicial review should only be granted on very narrow grounds. In so holding, he applied the approach of this court in R(Sivasubramaniam) v Wandsworth County Court [2003] 1 WLR 475. The effect of his decision is that a refusal by the Lands Tribunal to grant permission to appeal from the LVT can only be judicially reviewed in "exceptional circumstances", namely "on the ground of jurisdictional error in the narrow pre-Anisminic sense, or procedural irregularity of such a kind as to constitute a denial of the applicant's right to a fair hearing" – to quote from paragraph [56] of Sivasubramaniam. As it could make out no such ground in the present case, Sinclair's application for judicial review failed.
Before the LVT, written representations on behalf of Sinclair were made by Mr Letman, instructed by P Chevalier & Co, solicitors, and the tenants appeared in person. The written applications, to the LVT and to the Lands Tribunal, for permission to appeal were settled by Sinclair's legal advisers, and replied to by the tenants personally. In front of Sullivan J, Mr Letman was unopposed other than by the tenants in person. Mr Letman was initially unopposed...
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