First-tier Tribunal Rules on Payability of Service Charges

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : CAM/33UF/LIS/2021/0014 CAM/33UF/LLC/2021/0003 HMCTS code (audio, video, paper) : V: CVPREMOTE Property :

[ADDRESS] [POSTCODE]

Applicant : [redacted] : [NAME_2], director Respondents : [redacted] leaseholders listed in the table below Representative : [NAME_5] of application : Liability to pay service charges Tribunal members : Judge [NAME_7] Date of decision : 20 December 2021

DECISION

Covid-19 pandemic: description of hearing This has been a remote video hearing. A face-to-face hearing was not held because it was not practicable and all issues could be determined in a remote hearing. The documents we were referred to are those described in paragraph 4 below. We have noted the contents.

2 Decisions of the tribunal (1) The tribunal determines that the following service charges are payable by the following Respondents for the following periods. These are the relevant service charge proportion of the relevant costs determined in paragraphs 33 and 35 below (deducting £2,100 in the case of [NAME_47] as explained in paragraph 23 below). Flat Respondent(s) Service charge % Service charge payable (£) 1/7/2011- 30/6/2012 1/7/2012- 5/8/2012 15 [NAME_13] and [NAME_15] 2.8 854.95 62.44 16 [NAME_13] and [NAME_15] 3.5 1,068.69 78.05 25 [NAME_18] and [NAME_10] 2.8 Nil Nil 25 [NAME_20] and [NAME_23] 2.8 Nil Nil 28 [NAME_25] 3.5 1,068.69 78.05 29 [NAME_28] 3.5 1,068.69 78.05 30 [NAME_5] and [NAME_31] 2.8 854.95 62.44

(2) The tribunal orders under section 20C of the Landlord and Tenant Act 1985 (the “1985 Act”) that the costs incurred by the Applicant landlord in connection with these proceedings are not to be regarded as relevant costs to be taken into account in determining the amount of any service charge payable by the Respondents. (3) The tribunal does not order the Respondents to reimburse the tribunal fees paid by the Applicant, or make any other order in respect of costs. (4) As requested, the tribunal has sought to calculate contractual interest (set out in paragraph 42 below). However, these calculations cannot be relied upon. We make no determination of any interest payable because in these proceedings we do not have jurisdiction to do so. The parties must take independent advice and rely on their own interest calculations.

3 Reasons Application and procedural matters 1. The Applicant landlord sought determinations under section 27A of the Landlord and Tenant Act 1985 (the “1985 Act”) of payability of service charges for: (i) 1 July 2011 to 30 June 2012; and (ii) 1 July to 6 August 2012.

2. On 20 July 2021, the judge gave case management directions and the application with details of the service charges sought from each Respondent were served. Following the directions, the Respondents applied for an order under section 20C of the 1985 Act.

3. The relevant legal provisions are set out in the Appendix to this decision.

4. The directions referred to the No. 18 Decision (described in paragraph 12 below) and provided for the Respondents to produce their case documents by 20 August 2021. The Applicant was required to produce their documents in response by 15 September 2021 and deliver the hearing bundles by 29 September 2021. Instead, the Respondents produced their own large (partially paginated) bundle of documents and the Applicant then delivered their bundle (of 228 pages). On 30 October 2021, the Respondents contacted the tribunal office to express concerns that the bundle from the Applicant had been slightly late and had included documents which had not been delivered with the earlier case documents.

5. There was no inspection and we are satisfied an inspection is not necessary to determine the issues in this case. At the hearing on 11 November 2021, the Applicant was represented by [NAME_106]. The Respondents were generally represented by [NAME_5], with [NAME_31] in attendance, but [NAME_13] also attended with [NAME_35] to make additional representations. We were satisfied that it was appropriate to take into account all the documents in both bundles, which had been delivered by 30 September 2021, a reasonable time before the hearing. Background 6. There is a long history of applications to the tribunal in relation to [ADDRESS]. Originally an hotel, in the 1980s/90s the building was partially converted into flats let on long leases. It sits on the cliff top at Mundesley, exposed to the elements. The Applicant acquired the

4 freehold in 1999, when the conversion was unfinished. Persons connected with the Applicant are now the leaseholders of many of the individual flats. The Respondents are the “independent” leaseholders. The Property has been managed by tribunal-appointed managers for most of the last 20 years, but management returned to the Applicant between October 2009 and August 2012. The issues in the current proceedings relate to the latter part of that period.

7. The appointment of the second manager, [NAME_36], expired in about October 2009 when [NAME_36] resigned and retired from practice. By then, he had started proceedings against the Applicant and/or leaseholders connected with it, but been unable to reach the stage of recovering ordinary service charges from them. He had collected funds from the Applicant and other leaseholders for major works and had arranged for some works to be carried out, but these had not been successful. When his appointment terminated, [NAME_36] handed over to the Applicant the sum of £119,869.80, which the parties rounded to £119,870, being the residue of the funds [NAME_36] had collected for major works.

8. Service charges payable for relevant costs incurred for periods to 30 June 2011 were determined by previous tribunals. The most recent such decisions are in CAM/33UF/LIS/2011/0001 and CAM/33UF/LSC/ 2012/0016. Service charges payable in advance by all leaseholders for further major works at [ADDRESS] were also determined following a separate hearing in CAM/33UF/LIS/2011/0001, with the total figure set out in a certificate of correction (the “2012 Decision”). In their decision notice dated 19 January 2012, the relevant tribunal noted [at 8-9] that the Applicant and connected leaseholders had paid service charges sought by [NAME_36] for major works, but not the ordinary service charges he demanded. They noted it was not possible on the material provided to determine who had paid what, and as a result of the lack of ordinary service charge payments [NAME_36] had used some major works funds to pay insurance and other basic costs.

9. From 2009, the Applicant did not progress the requisite major works, at least until after they faced a new application to appoint a manager. That application was not successful, solely because the requisite preliminary notice had not been given. Given a new preliminary notice and another application to appoint a manager, the Applicant progressed preparations for the works and signed a roofing contract with a building contractor. New managers ([NAME_39]) were then appointed by a tribunal with effect from 6 August 2012 and took over the relevant contracts for the major works. With a change of manager, that appointment has been extended several times, most recently for a further five years, for the reasons set out in our decision dated 18 August 2021 in case number CAM/33UF/LOA/2021/0001 (the “Manager Decision”). The background is set out in more detail in that decision.

5 10. The relevant parties hotly contested entitlement to the £119,870 which had been handed over by [NAME_36] to the Applicant in 2009. They did so for many reasons, outlined in the documents and various previous tribunal decisions produced in the bundles for this hearing. The Applicant said they had contributed far more than the “independent” leaseholders and some of those leaseholders could not have contributed because they did not acquire their leases until later. The other leaseholders contested this and again said they had paid ordinary service charges for years while the Applicant refused to do so and [NAME_36] had, while commencing recovery action, used the major works fund to pay for buildings insurance and other essential matters. There were many other issues; these are only examples.

11. As a result, the new managers appointed in 2012 applied for directions as to the application of the £119,870. On 26 April 2013, a tribunal directed in CAM/33UF/LAM/ 2012/0001 (the “2013 Decision”) [at 3] that: (a) the sum be used to: “…partially defray the cost of the present major works contract…” and (b) pursuant to section 42(4), and subject to (6) and (8), of the Landlord and Tenant Act 1987 (the “1987 Act”), the contributing leaseholders (defined in s.42(1) as tenants of two or more dwellings required under the terms of their leases to contribute to the same costs by the payment of service charges): “…shall be treated as entitled by virtue of subsection 3(b) to such shares in the residue of the above fund as are proportionate to their respective liabilities to pay relevant service charges…”. That decision provided that any leaseholder wishing to assert they were entitled to a different share should apply to the county court for a determination of that question under section 52 of the 1987 Act.

12. The current application by the Applicant to determine payability of service charges for 1 July 2011 to 5 August 2012 followed our determination on 26 March 2021 in case number CAM/33UF/LIS/ 2020/0016 of an application by [NAME_35] to determine the service charges payable as leaseholder of No. 18 for the same periods (the “No. 18 Decision”). He made that application because he wanted to sell the lease. When “independent” leaseholders had attempted to sell their leases in the past, the Applicant had alleged various historical sums were owed and had previously attempted to demand from some such leaseholders more than seemed likely to have been due. Leases 13. The parties produced sample copies of the relevant leases and made their cases on the basis that for relevant purposes they were in the same terms. They were made between: (1) a former landlord; (2) [ADDRESS] (Mundesley) Management Company Limited; and (3) a former leaseholder. The management company has since been dissolved. Clauses 4(3) and 6(g) of the lease contain step-in provisions for the landlord if the management company failed to carry out its

6 obligations. In clause 3(1), the leaseholder covenants to pay the specified proportion of the maintenance charges. Part IV of Schedule 1 sets out two proportions. As confirmed in the 2012 Decision referenced above [at 27], the first (costs shared between Lady Hamilton House and [ADDRESS]) is no longer relevant. The relevant proportion is the second (costs for this building only), which the parties agreed is: (i) 2.8% for flats 15, 25 and 30 (one-bedroom flats); (ii) 3.5% for flats 16, 28 and 29 (larger flats).

14. Schedule 5 sets out the matters which will be relevant costs for the purposes of the maintenance charges, including (in summary, using the paragraph numbers from Schedule 5): (1) collection of maintenance charges and paying all proper expenses in respect thereof; and (13) making provision for payment of all legal and other costs and expenses incurred: (a) in the running and management of the building and in enforcement or attempted enforcement of the covenants conditions and regulations contained in the leases; and (b) in maintaining applications and representations in respect of any notice or order. Issues 15. The parties agreed that (aside from the issue of whether any relevant costs are to be treated as having been paid from the major works fund, as described below), the last service charge payment made by each of the Respondents was of £187.50 in 2010 in respect of charges payable for earlier periods. The Respondents had made no other payment in respect of the periods we are concerned with in these proceedings.

16. The parties produced a volume of largely unnecessary material and rehearsed their many grievances against each other, most of which have already been decided, so far as possible, in previous decisions of tribunals in this jurisdiction. We repeated at the start of the hearing that we had no power generally to write off “stale” service charges. Since the relevant service charges were not reserved as rent, the relevant limitation period under the Limitation Act 1980 was 12 years. Similarly, we confirmed that we would not attempt to revisit matters which had already been dealt with in previous decisions. The remaining issues which it appeared we should decide in these proceedings were: (i) the position in relation to the former and current [NAME_41] and whether the former were entitled to set off £2,100 (which had been charged as additional “costs” on sale of No.18) against any sums otherwise payable;

7 (ii) whether sums payable for 1 July 2011 to 6 August 2012 in relation to costs paid by the Applicant to suppliers for the major works should be treated as having been paid; and (iii) whether the other charges claimed for 1 July 2011 to 6 August 2012 were payable under the leases, and reasonably incurred. [NAME_41]

17. The Applicant claimed the same service charges from [NAME_47] (as former [NAME_41]) and from [NAME_42] (as the current leaseholders). The parties had not produced a copy of the lease of No.25, so we proposed to proceed on the basis it had been granted before 1996; this was not disputed. [NAME_43] said it had been granted in about May 1991.

Accordingly, we proceed on the basis that it is an “old lease” for the purposes of the Landlord and Tenant (Covenants) Act 1995 (the “1995 Act”), in the same relevant terms as the other copy leases produced. [NAME_35] said his company ([COMPANY_96]) had purchased the lease in about 2005 and that company changed its name (to [COMPANY_44]) in 2009. He thought the company had not transferred the lease into their personal names until a few weeks before they sold it to [NAME_42] in July 2014.

18. On the evidence produced by the parties, which included an extract from Land Registry entries dated 22 June 2012 naming [NAME_18] and [NAME_10] as the proprietors, we are satisfied that the lease was transferred to [NAME_45] on or before 22 June 2012 and they held it until [NAME_42] purchased the lease from them in July 2014. [NAME_35] had suggested in contemporaneous correspondence that the sale exchanged and completed on 4 July 2014. [NAME_13] confirmed at the hearing that the actual completion date was 9 July 2014.

19. The first on-account demand(s) for service charges may have been served while the company was still the leaseholder. However, those demands sought the wrong service charge proportions and nothing was paid towards the sums sought in those demands. In accordance with the terms of the lease, the demands relied upon by the Applicant were all made between December 2012 (in respect of the period from 1 July 2011 to 30 June 2012) and December 2013 (for the period from 1 July to 5 August 2012) and were for the relevant proportions of all the costs actually incurred.

20.

Accordingly, at the hearing, we put it to the Applicant that it appeared the alleged breaches (failure to pay the relevant service charges) were complete before the assignment in July 2014 to [NAME_42]. If so, even if this was an “old lease” for the purposes of the

8 1995 Act, under the long-established common law the assignees were not liable unless they had in some way agreed to become liable or the Applicant could explain some other basis on which they might be liable. The Applicant did not dispute the legal position, but [NAME_43] contended at the hearing that the correspondence from the [NAME_46] acting for [NAME_42] showed an intention to settle the service charges. This correspondence (in the Respondents’ bundle) simply showed the [NAME_46] had been asking the Applicant to say what the outstanding balance was, had made a retention of £1,000 and had told the tribunal-appointed manager (not the Applicant) that once they heard from the Applicant they would arrange to have arrears settled; they still had no idea how much might be claimed because the Applicant had not told them. We are not satisfied this was communicated to the Applicant at the relevant time, or created any kind of binding commitment. After a long delay, the Applicant produced a very large demand, at least some of which does not appear to have been justified. Perhaps unsurprisingly, no further progress was made. On the case and evidence produced to us, we are satisfied that [NAME_42] are not liable for any of the relevant service charges. 21. [NAME_12] could give no reason why [NAME_47] were not liable for any service charges we determined to be payable in respect of the period we are concerned with, given the demands between December 2012 and December 2013. However, as explained in the Manager Decision [at paras. 27 to 29], they were concerned that when they sold the lease of No.18 the Applicant required (in addition to sums which appeared to relate to the service charges payable under the No.18 Decision and previous decisions, plus interest) a further £2,100 for “costs” and they had no option but to pay this so they did not lose the sale. As we said in the Manager Decision, the Applicant should have known it had no right to this £2,100. We had pointed out to [NAME_66] at the hearing in February 2021 resulting in the No.18 Decision that (in relation to an attempt to claim different fees as administration charges) we could see no provision in the lease for any such administration charges (i.e. as sums payable by a single leaseholder) and he had been unable to point us to any such provision.

22. At the hearing of this matter, [NAME_48] said this figure was for actual legal costs they had incurred in seeking to recover service charges from [NAME_45]. The Applicant relied on the provision in paragraph 13 of Schedule 5 to the lease for legal costs and expenses to be recovered as part of the service charge. They produced no invoice or other contemporaneous evidence of any such costs. No such service charge costs had been claimed in respect of the relevant period in these proceedings, or in the proceedings which were concluded by the 2018 Decision (as part of which the Applicant had been required to specify all service charges sought from [NAME_49] for the period to 5 August 2012). The relevant tribunal appointed new managers with effect from 6 August 2012.

9 23. [NAME_48] explained no other grounds on which they could have been entitled to the additional £2,100. They helpfully accepted at the hearing that, if we decided the Applicant had not been entitled to the £2,100, it should be set off against any service charges we decided were otherwise payable by [NAME_41] to determine the sum payable. On the case and evidence provided to us, we are satisfied that the Applicant was not entitled to the £2,100 and accordingly that figure is to be deducted from the service charges we determine to be payable in respect of No.25. Major works invoices – 2013 Decision 24. In these proceedings, the Applicant claimed contributions towards third-party invoices paid for the start of the major works in the total sum of £92,646.64, comprised of: (i) for 1 July 2011 to 30 June 2012, a total of £14,894.40 paid to [NAME_50] (“[NAME_51]”), £1,012.02 paid to [NAME_53] (“[NAME_52]”) and £630 paid to [COMPANY_55] (“[NAME_54]”) for [COMPANY_97]; and (ii) for 1 July to 5 August 2012, a further £2,458.80 paid to [NAME_51] and a total of £73,651.42 paid to the roofing contractors, [NAME_57] (“[NAME_58]”).

25. The relevant tribunal had already determined in the 2012 Decision that these sums were reasonable and payable. From the Respondents, there was no dispute they had been reasonably incurred, or about the standard of the relevant works/services. However, the parties in effect sought to reopen the same questions as had been litigated in the earlier proceedings about whether the £119,870 (the residue from the previous major works fund) handed over to the Applicant in 2009, or any other sums, should be credited to any of the leaseholders, or more of this fund should be treated as having been held for the Applicant. We referred them to the direction in the 2013 Decision, as set out above, and observed no application had been made to the county court to determine that anyone was entitled to a different share of the fund.

26. The correspondence in the Respondents’ bundle demonstrates that ultimately only £17,000 of the £119,870 had been handed over by the Applicant to the new managers, [NAME_105], because the Applicant had used most of it to pay the initial major works invoices. As [NAME_59] reported on 3 September 2012: “[NAME_62] [[NAME_4]] has explained that [NAME_63] have been paying [NAME_64] from the £120,000 fund, as well as Reynolds Jury’s fees, and there is little left.” Ultimately, on 10 July 2013, [NAME_98] wrote: “The sum I was transferred at handover was circa

10 £17,000 after [NAME_63] spent the remainder of the £119,870 on Reynold’s Jury fees and [NAME_64]’s costs.. all lessees received a benefit from the full amount (£119,870) as it was spent on the major works, receipts have been provided to me and I am satisfied that it was spent appropriately, but [NAME_65] and I have been directed by the LVT to apportion the remaining balance … (i.e. the £17,000) among all lessees according to their service charge percentages…”.

27. It was put to [NAME_48] that, on this evidence, it appeared each leaseholder should be treated as having paid their service charge proportion of the invoices from [NAME_51] and [NAME_58]. There was no suggestion any such invoices had been paid from any other source or had been incurred during earlier periods; on the contrary, the criticism of the Applicant in the earlier decisions referred to their failure to progress the major works until they were faced with applications in 2011/12 to appoint a manager. [NAME_66] helpfully confirmed that the [NAME_52] and [NAME_54] invoices had also been paid from the same fund which the Applicant had been holding. [NAME_67] had already pointed out this left some £10,000 from the £119,870 which could have been used to pay other sums now being claimed, but we are not prepared to speculate about that. On the evidence provided to us, particularly the contemporaneous comments from [NAME_68], this difference simply leaves enough of a margin for error for us to be confident that the £92,646.64 was probably paid from the £119,870 in respect of which the 2013 Decision had been made. 28. [NAME_43] argued that [NAME_69] could not have been entitled to the share directed in the 2013 Decision because they had not acquired their lease until 2008. As we explained, we would not seek to reopen the 2013 Decision. In any event, the bundle included evidence that when [NAME_69] purchased their lease of No.30 from [NAME_71] in 2008, the lender paid £10,946.60 to the Applicant for ground rent, service charges and related costs and paid a further £15,331.67 to the then manager, [NAME_72], for the “balance of phase 1 refurbishment and outstanding service charges”. The parties also accused each other (in effect) of double counting in relation to the fund. [NAME_49] referred to a historical report which he said had indicated an additional sum, but again such arguments had been dealt with in the previous decisions and we doubt we would have been prepared to reopen them even if an adequate case and evidence had been provided in respect of the matters he mentioned. 29. [NAME_43] argued adjustments had been made by the [NAME_74] so each leaseholder had already been given credit, in revised demands, for the payments which had been made from the £119,870 and the Applicant had paid a “huge amount” of money towards the major works. It was said that, if we treated the leaseholders as having paid the relevant sums we would be crediting them twice. We are satisfied that is not the case. [NAME_105] had naturally prepared their first demands in the expectation

11 they would need to collect and pay all the sums expected to be payable in relation to the major works. When it emerged some £90,000/£100,000 of those sums had already been paid by the Applicant from the old major works fund and £17,000 was handed over, and they received the 2013 Decision, they issued revised demands following that decision (on the balance of probabilities, we are satisfied that each leaseholder was treated as having paid their service charge proportion of the sums already paid and credited with their share of the £17,000), seeking the balance of the anticipated major works costs.

30. On the case and evidence produced by the parties, we are satisfied on the balance of probabilities that the relevant Respondents are to be treated as having paid their service charge proportion of the £92,646.64. We are not so satisfied in relation to any of the other sums claimed by the Applicant, including the relevant proportions of the major works management fee claimed by the Applicant (examined below).

Accordingly, nothing further is payable by the Respondents in relation to the third-party major works costs claimed by the Applicant.

31. This finding is different from our determination in the No.18 Decision about these costs. In the proceedings which were concluded by the No.18 Decision, the applicant, [NAME_35], failed to comply with case management directions and failed to produce a bundle of the requisite documents, producing only two small bundles of generally unhelpful documents and leaving the Applicant to produce a substantive bundle for the hearing. In the current proceedings, [NAME_67] and the other Respondents explained the circumstances, made out the case and produced the evidence which [NAME_35] had not in in his proceedings, particularly in relation to the correspondence and other evidence from [NAME_75] in 2012 and 2013. Other sums claimed for 1 July 2011 to 30 June 2012 32. The other relevant costs claimed by the Applicant for this service charge year were in the total sum of £34,163.98, as listed for identification only in Schedule 1 to the No.18 Decision (total costs of £47,070.40 plus the £3,630 disallowed in that decision, less the sums paid to [NAME_51], [NAME_52] and [NAME_54] as set out above). Of these, the Respondents disputed the following items and our assessment is as follows. Disputed item Cost (£) Decision Labour charges 60 We are satisfied this cost for [NAME_76] to assist [NAME_79] to clear heavy items probably related to the common parts and was reasonably incurred.

12 Train travel for [NAME_107] 96.70 The Respondents asked whether travel costs were recoverable under the terms of the leases. We are satisfied that, while these travel costs had been misdescribed by the Applicant, they were payable as costs and expenses under paragraph 13 of Schedule 5 to the leases and reasonably incurred. [NAME_99] 35.22 We are satisfied these costs for gloves, rat traps and the like probably related to the common parts and were reasonably incurred. [NAME_81] removal of 16 tons inert material 190 We are satisfied these costs probably related to the common parts and were reasonably incurred. The Respondents told us they had photographs which did not show such a large volume of material left by the former contractors at the relevant time(s), but they had produced no such photographs in their bundle, merely asking whether this material had come from the Applicant’s own flats. Travel, lawnmower fuel and purchase S&M supplies for maintenance 99.60 Again, the Respondents’ challenge was whether these travel costs were recoverable under the terms of the lease. We are satisfied they were. [NAME_79] caretaker employee costs 8,925.08 The Respondents said a statement dated 28 December 2012 gave a lower figure, of £8,846.14 and asked whether any of these costs had been reimbursed by [COMPANY_82] (local managers, used by [NAME_105], who paid for services provided by [NAME_101] when he remained employed by the Applicant after the new managers were appointed from 6 August 2012). The Applicant said the difference had come from a small adjustment from HMRC which was accounted for after the 2012 statement. [NAME_67] pointed to different schedules from the Applicant with different dates and figures, suggesting these had been constructed by the Applicant and pointing to the lack of actual bank statements or the like in the bundles. On the evidence produced to us, we are satisfied that the £8,925.08 was reasonably incurred. The Respondents had in their schedule of disputed costs only identified a small difference, not alleged the figures were false. [COMPANY_100] would probably only have reimbursed employee costs relating to the period from 6 August 2012 (as [NAME_43] said) and the Respondents provided no contemporaneous evidence to suggest otherwise. Further, the figure claimed by the Applicant is included in an audit report signed by [COMPANY_85] which states that these costs are sufficiently supported by accounts, receipts, vouchers and other documents. Counsel’s fee for opposing the first (unsuccessful) application made by leaseholders in 2011 for appointment of managers 2,160 [NAME_67] had read the reasons we gave in the No.18 Decision [at 27] for allowing this cost. He argued the first application to appoint managers had been unsuccessful on a “technicality” and pointed out the relevant tribunal would otherwise have been minded to appoint, given the failure to progress the outstanding major works and the other issues in relation to the Applicant, described in detail in the earlier decisions. We are satisfied this cost was reasonably incurred; the failure to give the preliminary notice meant the landlord did not have the requisite formal reasonable period in which to improve matters or otherwise respond before the hearing of the matter. Counsel’s fees for opposing the (successful) second application to appoint managers 3,630 This is the total of various invoices for Counsel’s fees in relation to the second application, following the requisite preliminary notice. The reasons given by the Applicant for seeking these costs again in these proceedings were the same reasons as had been given in the proceedings concluded by the No.18 Decision. For the same reasons as given in the No. 18 Decision [at 28-29], in our assessment, these costs were not reasonably incurred. Applicant’s general management fee 3,500 This cost had been agreed by [NAME_35] for the purposes of the No.18 Decision. In these proceedings, [NAME_67] pointed out there had been very little general management and referred to all the management failings described in previous decisions. He observed the management fee had been reduced to £1,800 in a previous decision and argued an hourly rate for a property manager would be in the region of £45. He accepted no comparable evidence of a market rate had been produced by the Respondents and when we suggested the

14 market rate at the time was probably £200/£250 per flat, this was not contested. The £1,800 figure had been determined in a previous decision in view of the serious failures at that time to put measures in place to stop leaks from storm damage and the like. During the period we are concerned with, much of what the Applicant was doing was inadequate and some of the problems were of their own making. However, this was a difficult property and it was entitled to claim a reasonable management fee for the essential basic matters of arranging buildings insurance, employment administration, costs and risks in relation to [NAME_101] (who had been helpful at the time). [NAME_43] had also spent time successfully claiming £558 from insurers to cover a cost for repairing some storm damage, one of the items noted in the list of costs and credits for this period. As has been explained in the past, general management fees are not assessed on an hourly rate basis. Even if we adopted [NAME_67]’s hourly rate of £45, reasonable time spent was at least 2.5 hours per flat (of which there are 32) per year, which would be in line with the management fee claimed. In our assessment, it was reasonably incurred and is payable, even bearing in mind the small items which have been charged in addition to the management fee and might otherwise have been rolled up in it. [NAME_83] audit fee 240 This figure had already been determined in the 2012 Decision as part of the advance charges. [NAME_67] queried a lower figure of £120 in the statement from 28 December 2012. We are satisfied this was an interim figure. We are satisfied that the audit fee claimed was reasonably incurred and is payable. Applicant’s major works management fee 6,500 In the No.18 Decision [at 32], we noted that following discussion the claimed management fee of £8,200 had been reduced to and agreed at £6,500. [NAME_67] said that was still too high because previous documents indicated the Applicant would be charging 5% of the total major works costs. We are satisfied that the fee claimed was reasonably incurred and is payable. A substantial amount of work would have been needed, particularly in the early stages, liaising with the architects, attending

15 meetings, dealing with the statutory consultation process, taking on contracts and so on. That is consistent with the volume of copy documents produced in relation to this period. The contracts were then taken away from the Applicant before substantial costs were paid under them, so limiting their fee to 5% would be artificial. Even if we look only at the £73,651.42 paid to [NAME_58] for the period to 5 August 2012, we are satisfied this fee is a reasonable proportion of that cost for the work which is likely to have been involved.

33.

Accordingly, Counsel’s fees of £3,630 are to be deducted from the total of £34,163.98. The balance of £30,533.98 is the total relevant cost in respect of which a service charge is payable for this service charge year. Other sums claimed for 1 July to 5 August 2012 34. The other sums claimed by the Applicant for this balancing period totalled £3,080.14. The Respondents disputed each sum claimed, as set out below, and our assessment is as follows. Disputed item Cost (£) Notes Insurance 1,219.64 [NAME_87] asked whether some of this cost had been reimbursed by [COMPANY_82]. The Respondents produced no evidence to suggest it was. [NAME_43] told us, and we accept, the only reimbursement from [COMPANY_82] was for employment costs of [NAME_79] for periods after 6 August 2012 (when the Applicant retained him as an employee because the managers did not wish his employment to transfer to them). Bank commission 5.50 Again, [NAME_67] said this figure had not been included in the statement from 28 December 2012. The Applicant had not provided copy bank statements, but we accept their evidence that this was a bank charge for the business bank accounts and was paid. We are satisfied on the balance of probabilities that this cost was reasonably incurred and is payable. Counsel’s fees for 720 For the reasons given in the No.18 Decision [at 36], we disallowed this cost. In these

16 submissions in relation to the terms of the management order proceedings, the Applicant relied on the same arguments, but also argued submissions had been made to safeguard the new major works contracts. We asked about this at the hearing. [NAME_66] accepted that in part the submissions had been made for the protection of the Applicant’s own interests, but said they were also made to avoid problems with the major works contracts. The documents include indications that the architects and contractors were ready to work with the proposed managers, if appointed. Copies of the submissions made by the Applicant’s counsel had not been provided in the bundles and nor had a copy of the management order made in 2012. On the evidence produced, and in view of the £650 handover fee we have allowed below, we are not satisfied that any part of these fees were reasonably incurred as service charge costs. Fees for transfer of management 650 [NAME_67] insisted this fee was too high, having focussed on a reference to the work having been charged as at least five hours’ work at £150 per hour. The Applicant was not entitled to charge such a high hourly rate for the work it did here, but in view of the amount of practical work needed, as outlined in the No.18 Decision [at 37], we are satisfied this fee was reasonably incurred and is payable. Handing over a volume of documents in relation to major works and accounts, dealing with enquiries from the suppliers, the new managers and so on would have taken far more than five hours. Such time is valuable to enable the new managers to work more effectively, particularly when taking over in the middle of a major works project. Management fee 485 The No.18 Decision notes [at 38] that this figure had been agreed by the parties as a simple pro rata apportionment of the £3,500 general management fee for the previous service charge year. [NAME_67] said the apportionment calculation was wrong and the calculation should be to divide an annual fee (if any) by 365 and multiply it by 37 days for 1 July to 5 August 2012. None of the parties proposed any other calculation when asked to do so. In the circumstances, we are satisfied that the reasonably incurred and payable fee for this

17 period was £355 as a pro rata apportionment of an annual fee of £3,500. We disallow the balance of £130.

Conclusion 35.

Accordingly, Counsel’s fees of £720, and the £130 adjustment to the management fee, are to be deducted from the total of £3,080.14. The balance of £2,230.14 is the total relevant cost in respect of which a service charge is payable for the period from 1 July to 5 August 2012. S20C order, tribunal fees and costs 36. The Applicant resisted the making of a section 20C order and sought reimbursement of the tribunal fees they had paid. They sought costs from the Respondents, and vice versa. They pointed out the Respondents had failed to respond sensibly when the Applicant wrote in April 2021 following issue of the No.18 Decision to seek: (a) sums which they said had been determined in previous decisions for 2010 to 2011; (b) sums calculated on the same basis as the No.18 Decision for 2011 to 2012; and (c) contractual interest, warning they would start recovery proceedings if these were not paid. The Applicant had not taken action for a long time, but the Property and relationship had always been difficult. They had waited until June 2021 before starting these proceedings and the Respondents had answered with a large volume of material and issues, much of which could have been avoided or reduced. 37. [NAME_67] had already apologised for the volume of documents produced, while pointing out the leaseholders had all assumed the Applicant had written off these historic disputed claims. [NAME_35] had to take action to arrive at a sensible figure so the lease of No.18 could be sold, but then he had not prepared his case adequately. When after so many years the Applicant then took these proceedings against the other “independent” leaseholders, they felt they had to explain all the history one last time and try to produce all the evidence which might be needed in relation to the major works charges. He submitted that, if the Respondents were successful in relation to the major works charges, the Applicant would have been acting unreasonably, since the bulk of the disputed charges had already been paid. [NAME_13] referred to the distrust between the parties and the other matters which led the tribunal to extend the appointment of the manager, as explained in the Manager Decision.

38. We generally accept the submissions made by the Respondents about this. They should have responded more

18 constructively to the demands (and we comment on this further below). However, in all the circumstances, particularly given that the sums pursued by the Applicant this year were for periods more than nine years ago and (perhaps as a result of their own delay) forgot that much of the charges were to be treated as having been paid, we conclude each party should bear their own costs of these unfortunate proceedings.

Accordingly, we have decided to make an order under section 20C of the 1985 Act. We do so purely on a contingency basis, since the Property is currently managed by the tribunal-appointed manager. It is just and equitable to make the order to ensure there will be no dispute about this in future. For the same reasons, we make no other order in respect of the tribunal fees or other costs of these proceedings. Observations 39. We hope these are the last tribunal proceedings in relation to historical service charges at the Property. They certainly should be. It appears much of the sums now being claimed by the Applicant will be for compound contractual interest apparently payable under the leases because the Respondents have refused to make payments on account, even under protest, for such a long time, apparently hoping these claims or the Applicant might go away. We understand why the Respondents were suspicious and both parties have dragged up all their old grievances, concerns and arguments in these proceedings, forgetting that most of them have already been dealt with in previous decisions or are outside the jurisdiction of the tribunal, but this should be the end of the road.

40. The parties must take their own independent legal advice - we cannot advise them - but we suggest the Respondents move past their instinctive refusal to pay anything to the Applicant and pay the service charges we have determined as payable by each of them (set out in the table at the start of this decision), plus any interest payable (estimated in the table below), without delay.

41. Similarly, the Respondents may wish to consider paying at least whatever sums they believe were determined in previous decisions for the period from 2 October 2009 to 30 June 2011 plus any interest payable on those sums, unless they are advised they have a complete defence to any such claims. We cannot re-determine those sums or attempt to calculate such interest for them. As we pointed out at the hearing, it is striking that even the sums claimed by the Applicant to have been determined in those previous decisions (for leaseholders paying 2.8%) were “only” £356.20 for 2 October 2009 to 30 June 2010 (leaving a balance of £168.70 after the acknowledged on-account payment of £187.50) and £673.34 for 1 July 2010 to 30 June 2011. [NAME_70]’s comments about (unless advised otherwise) making appropriate payments and drawing a line under this seemed to us to be wise.

19 42. As requested, the tribunal has sought to calculate approximate contractual interest on the sums we have determined in this decision for 1 July 2011 to 5 August 2012, in an attempt to help the parties to draw a line under historic matters. This interest has been calculated by reference to clause 2(14) of the lease, which provides that, if demanded, the leaseholder shall pay interest on any overdue payment at the rate of 5% over the base rate of [COMPANY_89], such interest to be capitalised quarterly. For the purposes of this informal estimate, we have assumed the same payment periods as in the No.18 Decision. Amount/period Interest (£) to 11 November 2021 £854.95 from 12 January 2013 (2.8%) 534.96 £1,068.69 from 12 January 2013 (3.5%) 668.70 £62.44 from 20 January 2013 (2.8%) 39.07 £78.05 from 20 January 2013 (3.5%) 48.84

43. However, as noted above, these calculations cannot be relied upon. We make no determination of any interest payable because in these proceedings we do not have jurisdiction to do so. The parties must take independent legal advice and rely on their own interest calculations. Name: Judge David Wyatt Date: 20 December 2021

Rights of appeal

By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber), then a written application for permission must be made to the First-tier Tribunal at the regional office which has been dealing with the case. The application for permission to appeal must arrive at the regional office within 28 days after the tribunal sends written reasons for the decision to the person making the application. If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28-day time limit; the tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed, despite not being within the time limit.

20 The application for permission to appeal must identify the decision of the tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal and state the result the party making the application is seeking. If the tribunal refuses to grant permission to appeal, a further application for permission may be made to the Upper Tribunal (Lands Chamber).

Appendix of relevant legislation

Landlord and Tenant Act 1985 (as amended) Section 18 (1) In the following provisions of this Act "service charge" means an amount payable by a tenant of a dwelling as part of or in addition to the rent - (a) which is payable, directly or indirectly, for services, repairs, maintenance, improvements or insurance or the landlord's costs of management, and (b) the whole or part of which varies or may vary according to the relevant costs. (2) The relevant costs are the costs or estimated costs incurred or to be incurred by or on behalf of the landlord, or a superior landlord, in connection with the matters for which the service charge is payable. (3) For this purpose - (a) "costs" includes overheads, and (b) costs are relevant costs in relation to a service charge whether they are incurred, or to be incurred, in the period for which the service charge is payable or in an earlier or later period. Section 19 (1) Relevant costs shall be taken into account in determining the amount of a service charge payable for a period - (a) only to the extent that they are reasonably incurred, and (b) where they are incurred on the provisions of services or the carrying out of works, only if the services or works are of a reasonable standard; and the amount payable shall be limited accordingly. (2) Where a service charge is payable before the relevant costs are incurred, no greater amount than is reasonable is so payable, and after the relevant costs have been incurred any necessary adjustment shall be made by repayment, reduction or subsequent charges or otherwise.

21 Section 27A (1) An application may be made to the appropriate tribunal for a determination whether a service charge is payable and, if it is, as to - (a) the person by whom it is payable, (b) the person to whom it is payable, (c) the amount which is payable, (d) the date at or by which it is payable, and (e) the manner in which it is payable. (2) Subsection (1) applies whether or not any payment has been made. (3) An application may also be made to the appropriate tribunal for a determination whether, if costs were incurred for services, repairs, maintenance, improvements, insurance or management of any specified description, a service charge would be payable for the costs and, if it would, as to - (a) the person by whom it would be payable, (b) the person to whom it would be payable, (c) the amount which would be payable, (d) the date at or by which it would be payable, and (e) the manner in which it would be payable. (4) No application under subsection (1) or (3) may be made in respect of a matter which - (a) has been agreed or admitted by the tenant, (b) has been, or is to be, referred to arbitration pursuant to a post-dispute arbitration agreement to which the tenant is a party, (c) has been the subject of determination by a court, or (d) has been the subject of determination by an arbitral tribunal pursuant to a post-dispute arbitration agreement. (5) But the tenant is not to be taken to have agreed or admitted any matter by reason only of having made any payment.

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : CAM/33UF/LIS/2021/0014 HMCTS code (audio, video, paper) : P: PAPERREMOTE Property : [ADDRESS] [POSTCODE] Applicant : [redacted] Respondents : [redacted] leaseholders listed in the substantive Decision (described below) Type of application : Application for permission to appeal Tribunal members : Judge [NAME_7] Date of decision : 28 January 2022

DECISION Covid-19 pandemic: description of decision This has been a remote decision on the papers. The form of remote decision was P:PAPERREMOTE. A hearing was not held because it was not necessary; all issues could be determined on paper. The documents we were referred to are those described in paragraph 4 below. We have noted the contents. Decisions of the Tribunal 1. The tribunal has considered the request for permission to appeal based on the grounds of appeal provided and decided that: (a) the tribunal will not review its Decision; and (b) permission to appeal is refused.

2 2. In accordance with section 11 of the Tribunals, Courts and Enforcement Act 2007 and rule 21 of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010, each party who applied for permission to appeal may make further application for permission to appeal to the Upper Tribunal (Lands Chamber). Such application must be made in writing and received by the Upper Tribunal (Lands Chamber) no later than 14 days after the date on which the First-tier Tribunal sent notice of this refusal to the party applying for permission to appeal.

3. Where possible, you should send any such further application for permission to appeal by email to [EMAIL], as this will enable the Upper Tribunal (Lands Chamber) to deal with it more efficiently. Alternatively, the Upper Tribunal (Lands Chamber) may be contacted at: 5th [ADDRESS] [POSTCODE] (tel: [PHONE]). Reasons for this decision 4. The substantive decision was made on 20 December 2021 (the “Decision”). On 13 January 2022, the Applicant applied for permission to appeal with their grounds of appeal, comprising an e-mail which attached an electronic bundle of 145 pages. We have taken those documents, and those described in paragraph 4 of the Decision, into account.

5. We consider that none of the grounds of appeal have any realistic prospect of success. For the benefit of the parties and of the Upper Tribunal (Lands Chamber) (if any further application for permission to appeal is made), we have in the attached Appendix set out comments on two specific points raised by the Applicant in their grounds of appeal. Please read this document with the Decision, which explains the background and the expressions used. References below in [square brackets] are to those paragraphs in the Decision.

6. The other points canvassed in the Applicant’s documents are disagreements with the tribunal’s Decision and the 2013 Decision (described in the Decision), or further attempts to revisit historic grievances between the parties which have been addressed, so far as possible, in earlier decisions of the tribunal (or of other tribunals in this jurisdiction).

3 APPENDIX TO THE

DECISION REFUSING PERMISSION TO APPEAL New evidence in relation to major works payments [24-31]

1. The Applicant landlord asserts (for the first time) that, acting on the directions in the 2013 Decision, the tribunal-appointed managers ([NAME_75]): “…allocated £30,490.37 of the Applicants financial contribution to the Respondents during the service charge period from 6 August 2013 to 5 August 2014.” In their longer document attached to that e-mail, the Applicant says this is “conclusively confirmed” by the service charge accounts produced by the accountants, [COMPANY_90], but those accounts give no such confirmation.

2. The Applicant produces (for the first time) copy bank statements for the period from 6 August 2012 to 15 September 2014. Using their analysis of these statements, they assert that:

a. the Applicant paid £421,593.98 towards major works for the period from 6 August 2012 to 5 August 2013 and £103,347.37 for the period from 6 August 2013 to 5 August 2014; and

b. the “independent Leaseholders/Respondents” paid £143,125.08 towards the major works for the former period and £21,967.53 for the latter period.

3. The Applicant says this corresponds with the figures in service charge accounts for the former period (£421,594 and £143,126 respectively) but in relation to the latter period the accounts show £72,857 received from “[NAME_63]” and £52,438 received from “Residents”.

4. The Applicant argues (in essence) that it follows from this alleged difference that [NAME_75] must have: “allocated £30,470.73 of the Applicants contributions/funds to the independent leaseholders”. They make essentially the same assertion in several slightly different ways, all based on their analysis of the bank statements compared to these figures in the accounts. They do not explain precisely how their analysis fits the inference they are now asking us to draw. The difference between the payments said to be attributable to the Applicant of £103,347.37 and £72,857 (£30,490.37) is not the same as the alleged difference between the payments said to be attributable to the “Residents” of £21,967.53 and £52,438 (£30,470.47).

5. Nor does the Applicant explain how they say this alleged difference corresponds with the service charge proportions of the relevant “independent” leaseholders of the relevant initial major works invoices (or of the old major works fund of £119,870). It seems likely that the total of these would have been less than £30,000. However, we comment below on the argument the Applicant is now seeking to make.

4 6. It is a basic general principle that there has to be an end to litigation. In Ladd v Marshal [1954] 1 WLR 1489, in the Court of Appeal, Denning LJ said: “In order to justify the reception of fresh evidence or a new trial, three conditions must be fulfilled: first, it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial: second, the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive: thirdly, the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, though it need not be incontrovertible.”

7. The Applicant fails the first test. These proceedings were brought by the Applicant at a time of their own choosing. They applied to the tribunal on 18 June 2021 seeking determinations in respect of service charges (from 2011 and 2012) which were about 10 years’ old. They had apparently taken no recovery action in respect of such charges for years, despite being permitted by the relevant management order (from 2012) to do so. The case management directions given on 20 July 2021 referred to the No.18 Decision (which determined the service charges payable in respect of Flat 18 for the same periods). The Respondent leaseholders were directed to produce their case documents first, to show why they said different charges were payable.

8. It was obvious from the case documents produced by the Respondents pursuant to those directions that they were contending they had paid (or should based on the 2013 Decision and the correspondence they produced from [NAME_75] be treated as having paid) their service charge proportion of the relevant major works invoices. The Applicant then produced their case documents in answer. All the documents were exchanged between the parties in August and September 2021 and there was no request for more time. The Applicant had ample time to produce any case and evidence they wished to rely upon before the hearing on 11 November 2021.

9. Despite this, even at the hearing, the Applicant did not make the case they are now seeking to argue. The bank statements and analysis relied upon in seeking permission to appeal had not been mentioned before now, let alone included in the documents produced for the hearing. It appears the copy bank statements enclosed with the application for permission to appeal were already in the possession of the Applicant and could have been produced for the hearing.

10. As noted at [29], [NAME_43] argued at the hearing that adjustments had been made by [NAME_75] so each leaseholder had already been given credit, in revised demands, for the major works invoices which had been paid from the £119,870 and the Applicant had paid a “huge amount” towards the major works. On the case and evidence produced, we were satisfied on the balance of probabilities that (as would be expected generally and from the 2013 Decision) the managers had treated the Applicant and the “independent” leaseholders in the same way. That is, they had reduced the amounts sought in the

5 managers’ original demands to (following the 2013 Decision) treat everyone as having already paid their service charge proportion of the relevant initial major works invoices. They did so because the Applicant had paid those invoices from the old major works fund of £119,870 instead of handing over the entire fund to the managers.

11. It may help to explain that, even if the Applicant had not failed the first test, their analysis of the bank statements does not necessarily (and on the material produced seems unlikely to) support the inference they are seeking to draw. As explained below, they appear to be projecting what they wish to see onto the documents.

12. First, the Applicant relies on drawing an inference from what they say their analysis of their new evidence shows. It is inherently unlikely that the managers and accountants would have allocated payments to others. They would be expected to attribute payments to the relevant payers and give a clear statement or explanation if it was agreed that payments were to be attributed to others. No evidence of any such statement, explanation or agreement has been produced. The relevant service charge accounts were settled a long time ago. If the Applicant wished to challenge those accounts, they needed to do so promptly, not some eight years later. Further, no good reason has been given to explain why the managers and accountants might have allocated payments to others. Nothing in the 2013 Decision required that the “independent” leaseholders be treated differently from the Applicant or the leaseholders connected with it, let alone that payments from the Applicant be attributed to the “independent” leaseholders. On the contrary, it directed that they were each to be treated as entitled to their service charge proportion of the old major works fund of £119,870.

13. Further, the Applicant’s analysis of the statements may not be reliable. We do not propose to attempt to examine the bank statements in detail, since further disclosure and examination, probably with a new hearing, would be necessary to attempt the assessment the Applicant seeks. However, we note the source of some payments is not clear from the statements which have been produced. We do not know whether payments were made outside the relevant accounting periods but attributed to them. An issue between these parties in other proceedings revealed that some leaseholders pay all charges into a general service charge account and the appropriate major works sums are later transferred into a major works account, which may or may not have been the case when [NAME_75] were managing the property. Even if the Applicant’s analysis of the bank statements is correct, it does not follow that payments from the Applicant for the major works were attributed to the “independent” leaseholders. The Applicant is likely to have been making: (a) some payments in respect of the flats which were unfinished/unlet and flats leased apparently to the Applicant; and (b) some payments on behalf of other leaseholders connected with it, described as “family and friends”, who are likely to have been described as “Residents”.

6 14. Further, the Applicant’s argument is inconsistent with the documents which were produced for the hearing. These include the e-mail of 31 July 2013 from [NAME_59] which has been enclosed with the Applicant’s grounds of appeal and referred to by the Applicant as if it supports their argument, referring as it does to an adjustment and an amount of £30,417.42. However, the relevant part of that e-mail (to [NAME_91] for the Applicant) simply says: “…I have recalculated the balances due from each leaseholder as I had omitted to deduct the expenditure [NAME_63] incurred prior to handing over to myself and [NAME_65]. I attach the two statements hereto in respect of the outstanding monies. As you say, the amount is a little over £30,000; the total is £30,417.42. If you could make payment as soon as possible I would be very grateful…”. Even now, the statements referred to in this e-mail have not been produced, but the e-mail gives no indication that [NAME_98] had allocated payments from the Applicant to others. On the contrary, it is asking the Applicant to pay £30,417.42 (which was probably the reduced demand after the Applicant was given credit for their service charge proportion of the relevant major works invoices) to the managers. That obvious meaning of the e-mail is confirmed by the bank statements, which show receipt on 6 August 2013 of a payment of £30,417.37 from the Applicant.

New evidence in respect of the “legal costs” of £2,100 required from [NAME_35] on sale of the lease of No.18 [21-23]

15. As noted at [22], no such service charge cost had been claimed in respect of the relevant period in these proceedings and no invoice or other contemporaneous evidence of any such costs had been provided. With their application for permission to appeal, the Applicant now produces copy invoices from [NAME_92], which refer to a “service charge dispute” in connection with Flat 18, one dated 30 November 2017 for £1,380 and one dated 28 February 2018 for £652.80 (a total of £2,032.80, not £2,100).

16. In any event, this fails the same first test under [NAME_93] v [NAME_94]. Further, although the Applicant insists these “…legal costs were incurred during the Applicant’s management period”, they obviously were not. Tribunal-appointed managers have been exercising the management functions under the leases without interruption since 6 August 2012. Even if a case in relation to these invoices had been made and had merit, it would have been for 2.8% of £2,032.80/£2,100 (i.e. less than £60), not the £2,100 which was (in effect) required by the Applicant to allow the sale of No.18 to proceed. Even if the Applicant was entitled to the relevant amount (of less than £60) from [NAME_47], that would have made no difference to the outcome of these proceedings. Under the approach agreed with the Applicant, noted at [23], we set off only £917.39 from the £2,100 against the service charges we decided were otherwise payable by the relevant [NAME_95] as [NAME_41] (£854.95 plus £62.44, as set out in the table at the start of the Decision), bringing those down to nil.