Holding & Management (Solitaire) Limited v Leaseholders of Sovereign View
[2023] UKUT 174 (LC)
Adriatic Land 5 Limited v The Long Leaseholders at Hippersley Point
13 November 2023
[2023] UKUT 271 (LC)
Upper Tribunal
A landlord got permission to do fire safety repairs without consulting all tenants, but a court said they couldn't charge the tenants for the costs of getting that permission. A new law said the landlord shouldn't have to pay anyway for those costs, so the court made the permission official without the landlord having to pay.
Key Facts
- •Appeal against a First-tier Tribunal (Property Chamber) decision regarding dispensation from consultation requirements under Section 20 of the Landlord and Tenant Act 1985.
- •Dispensation application by Adriatic Land 5 Limited (Appellant) for remediation works at Hippersley Point, a mixed-use building with 32 residential flats.
- •FTT initially granted unconditional dispensation but prevented cost recovery from leaseholders (Respondents).
- •On review, FTT granted conditional dispensation, prohibiting cost recovery.
- •Appellant appealed the costs condition, raising the issue of whether costs are covered by paragraph 9 of Schedule 8 to the Building Safety Act 2022.
- •Respondents were not represented at the hearing but had prior notice and filed statements.
Legal Principles
The tribunal has power to grant dispensation on such terms as it thinks fit – provided any such terms are appropriate in their nature and effect.
Aster Communities v Chapman [2020] UKUT 177 (LC)
The purpose of consultation requirements is to protect tenants from inappropriate works or excessive costs. The tribunal should focus on prejudice to tenants from the landlord's failure to consult.
Daejan Investments Ltd v Benson [2013] UKSC 14
A tribunal can impose conditions on the grant of dispensation, including requiring the landlord to pay tenants' reasonable costs, if deemed appropriate.
Daejan Investments Ltd v Benson [2013] UKSC 14
No service charge is payable under a qualifying lease for legal or other professional services relating to the liability (or potential liability) of any person incurred due to a relevant defect.
Building Safety Act 2022, Schedule 8, paragraph 9
Outcomes
Appeal allowed.
The FTT's imposition of the costs condition was procedurally unfair (no opportunity for submissions) and substantively flawed (reasoning contradicted its findings of no tenant prejudice). Furthermore, the Building Safety Act 2022, Schedule 8, paragraph 9 prevents cost recovery from leaseholders with qualifying leases.
Reviewed Decision re-made.
Dispensation granted unconditionally. Costs are not recoverable from leaseholders with qualifying leases due to paragraph 9 of Schedule 8, Building Safety Act 2022.