Sheltered Housing Management Limited V. Miss Isobel Cairns And Others For Rectification Of A Document
| Jurisdiction | Scotland |
| Judge | Lord Nimmo Smith |
| Date | 11 September 2002 |
| Docket Number | P262/01 |
| Court | Court of Session |
| Published date | 11 September 2002 |
| OUTER HOUSE, COURT OF SESSION | |
| P262/01
| OPINION OF LORD NIMMO SMITH in Petition of SHELTERED HOUSING MANAGEMENT LIMITED Petitioners; against MISS ISOBEL CAIRNS AND OTHERS Respondents: for Rectification of a document ________________ |
Petitioners: Clark; Brodies, W.S.
Respondents: Joughlin; Balfour & Manson
11 September 2002
[1]This is a petition for rectification of a Deed of Conditions granted by Barratt (Falkirk) Limited ("Barratt") dated 27 June and recorded in the Division of the General Register of Sasines for the County of Stirling on 7 August, both in the year 1985 ("the recorded Deed"). The recorded Deed relates to a sheltered housing complex erected by Barratt on subjects then owned by them and now known as Springbank Gardens, Thornhill Road, Falkirk ("the complex"). There are fifty three individual privately-owned dwellings in the complex, in relation to each of which Barratt granted a Feu Disposition in favour of the original purchaser or purchasers. Each Feu Disposition was granted with and under the burdens, reservations, conditions, restrictions, obligations, provisions, declarations and others specified in three deeds, one of which was the recorded Deed. The petitioners, Sheltered Housing Management Limited ("SHM"), have from the outset administered and managed the complex. They have also, in circumstances which I shall describe, succeeded Barratt as superiors of each of the dwellings. The respondents are the owners of some of these dwellings. They oppose the rectification of the recorded Deed sought by SHM. A number of other owners on whom the petition was originally served as respondents have since sold their dwellings or have died. The petition and answers came before me for a proof before answer.
[2]A sheltered housing complex provides facilities which are intended to meet the needs of people who have reached a time in their lives when they wish to be provided with a certain amount of help with their living arrangements but do not yet need the facilities of a residential home or a nursing home. The complex appears to be typical of sheltered housing complexes in the facilities which are provided. There is a minimum age limit of 50 for female and 55 for male residents (the reason for the difference in age was not explained to me). Of the fifty three dwellings, thirty five are flats in a tenement and eighteen are terraced or semi-detached bungalows. There are also a flat and an office for the resident manager (previously called "resident warden"), two lounges and three guest rooms for the use of the residents, parking areas and areas of communal gardens. In addition, each of the bungalows has its own garden ground. The flats are served by a lift, stairs and corridors. Each dwelling has an alarm system which can be operated by a resident in an emergency in order to attract the attention of the manager.
[3]The current management scheme, under which SHM provide services, was notified to the residents on 13 April 1992. In terms thereof, SHM appoint a resident manager, who lives in the warden's flat, and a relief manager who stands in for the resident manager during days off. These individuals provide the day to day management of the complex during the normal working week. The duties of the resident manager and relief manager, as described in the scheme, are "generally to look after the well being and safety of the residents in a caring but unobtrusive manner". They include responding to any emergency call and summoning such assistance as may be necessary, maintaining a register of occupants with particulars of next of kin or other persons to be contacted in an emergency, maintaining a register of doctors and other professional persons, being available during normal hours to assist and welcome newcomers with help and advice, assisting the residents in organising communal activities, supervising works of maintenance, repair and renewal for which SHM are responsible, and having a good knowledge of local facilities such as shops. SHM are responsible for the insurance of all buildings within the development, the maintenance of all buildings externally including redecoration when necessary, the maintenance of all fences, hedges and boundaries within the complex, the maintenance of footpaths and roadways not the responsibility of the highways authority, management of the communal parking areas and the maintenance of all common garden ground and landscaped areas. The owner of each dwelling is responsible for the insurance of its contents and the maintenance of the dwelling internally, including decorating and window cleaning internally and externally. There is also provision in the scheme for payment of a monthly charge, a topic to which I shall return.
[4]All sheltered housing complexes in Scotland have management companies, but there is no uniform practice in relation to the process by which decisions about the provision of services are taken and service charges are fixed. Evidence about the way in which SHM operate was given by their managing director, Bruce Miller. SHM manage nine sheltered housing complexes, all in Scotland, under management schemes similar to that summarised above. The main feature of such schemes which is significant for present purposes is that in each case SHM fix the amount of the monthly service charge. The service charge is calculated in such a way as to cover SHM's outlays and overheads and provide an element of profit. The residents are not, however, provided with a budget or accounts, and Mr Miller has steadfastly refused to disclose, in relation to any of the complexes managed by SHM, how the service charges are calculated or what the element of profit is. This is perceived by some residents as resulting in a lack of accountability, but it appears that the vast majority of the residents in complexes managed by SHM are content with the services provided and to pay the service charges.
[5]Evidence about another type of system was given by Colin Campbell, an expert witness for the respondents, who is a director of Heritage Homes Limited and Lifetime (Scotland) Limited, and for some years was a director of Peverel Management Services Limited. He described the schemes operated in a number of sheltered housing complexes in Scotland under what seems to be generally described as a system of factoring, a word which Mr Campbell preferred not to use himself. Under this system, residents in a complex are provided with budgets and accounts, so that they are aware of the amount of individual items of expenditure and of the fee charged by the management company. Decisions, such as whether to approve a budget, may be taken by a majority of the residents. In some instances, the residents may be able to decide to change the management company; in others, the management company cannot be changed.
[6]I do not find it possible on the evidence to hold that either the system operated by SHM or the factoring system is preferable to the other. There may be a lack of accountability in the SHM system, but the residents in the nine complexes managed by them appear generally to be contented with the level of the services provided by SHM and the amount of their charges. Residents in these complexes can of course compare the charges with those payable in similar complexes elsewhere, and SHM recognise that it is in their interests that their charges should not differ greatly from those of other management companies. The factoring system provides greater accountability, but it does oblige the residents to contribute to a reserve fund to provide for unforeseen items of expenditure, which is not necessary under the system operated by SHM. There is scope under both systems for dissent among the residents.
[7]When Barratt decided to develop the complex it was contemplated from the outset that SHM would be the management company and that in due course the superiority would be conveyed to them. Barratt appointed a firm of solicitors in Falkirk, Messrs Blackadder and McMonagle, to act for them. This was the first sheltered housing complex in relation to which this firm provided services. I heard evidence about how this transaction was conducted from Mr Miller of SHM, Iain Mitchell, the company secretary of Barratt at the material time, and Manus McMonagle, the partner in Blackadder and McMonagle who acted for Barratt. In the course of the transaction Barratt and SHM entered into a Minute of Agreement. It was executed by SHM on 29 and by Barratt on 30 April 1985. It was registered in the Books of Council and Session on 8 January 1990: why this was done at that time was not explained to me. The Minute of Agreement provided inter alia as follows:
"(ONE) The First Party [Barratt] shall be entitled to sell to such persons as they deem fit all and any of the said houses, provided always that the prospective purchaser of said house shall, in the case of a female, have attained the age of fifty, or in the case of a male person, attained the age of fifty five, subject to the first party being able to sell all or any such houses to such deserving persons as they shall, in their sole discretion, see fit.
(TWO) The First Party shall grant title of each individual Sheltered Housing Dwelling to such purchasers by way of Feu Disposition subject to conditions contained in a Deed of Conditions to be recorded by the first party in terms of appendix 1 to this agreement.
(THREE) The First Party shall retain the Superiority of the said subjects.
(FOUR) The First Party shall grant a Disposition without any consideration to the Second Party [SHM] of the Wardens flat, Wardens office and three guest bedrooms. The Second Party shall be bound to reconvey without any consideration therefore Wardens flat, Wardens office, three guest bedrooms and all rights associated therewith, to the First Party or such person as shall be nominated by the First Party in the event of termination of this agreement....
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