First-tier Tribunal Varies Management Order

OUTCOME: Allowed

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL [NAME] CHAMBER ([NAME])

Case Reference

:

CHI/45UB/LVM/2021/0004

[NAME]

:

[ADDRESS], Shoreham by Sea, West Sussex [POSTCODE]

Applicant: [redacted]

:

Mr [COUNSEL], counsel

Respondent: [redacted]

:

Type of Application

:

Application to vary a management order

Tribunal Member(s)

:

Judge [NAME] [NAME] of Hearing

Date of Decision

:

:

26th August 2021 and 24th November 2021

14th December 2021

Decision

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Background

1. The Applicant seeks an Order extending the appointment of a Tribunal Appointed Manager and replacing the current manager, Mr [NAME], with Ms [NAME].

2. The Applicants are one of the leaseholders at the building. The Respondents are both the freeholders and owners of the other leasehold interests in the [NAME].

3. Mr [NAME] had been appointed by an Order dated 3rd March 2020 for a period of 12 months with such appointment extended by order made on 2nd October 2020 until 30th June 2021. Mr [NAME] had indicated to the parties that he would not be seeking an extension of the order and so the current application was made.

4. Various sets of directions had been issued. Mr [NAME] had been required to submit various documents. [NAME] failed to comply with Judge Tildesley’s directions and a direction was issued requiring Mr [NAME] to attend the hearing on 26th August 2021.

5. At the hearing on 26th August the Applicants were represented by Mr [COUNSEL] of counsel and the Respondents attended in person. Ms [COUNSEL] also attended. Both parties gave evidence and made their respective submissions in respect of the application before the Tribunal and the Tribunal heard from [NAME]. The Tribunal issued directions listing the matter for a further hearing at which Mr [NAME] was required to attend.

6. A hearing bundle was supplied for the initial hearing together with other documents supplied by the various parties. References in [ ] are to pages within the original hearing bundle.

The Law

7. The relevant law is contained within Section 24 of the Landlord and Tenant Act 1987 which states that:

Section 24 Appointment of manager by a leasehold valuation tribunal.

(1)A leasehold valuation tribunal may, on an application for an order under this section, by order (whether interlocutory or final) appoint a manager to carry out in relation to any premises to which this Part applies—

(a) such functions in connection with the management of the premises, or

3 (b) such functions of a receiver,or both, as [F1the tribunal] thinks fit.

(2) A leasehold valuation tribunal may only make an order under this section in the following circumstances, namely—

(a)where the tribunal is satisfied—

(i)that any relevant person either is in breach of any obligation owed by him to the tenant under his tenancy and relating to the management of the premises in question or any part of them or (in the case of an obligation dependent on notice) would be in breach of any such obligation but for the fact that it has not been reasonably practicable for the tenant to give him the appropriate notice, and (ii). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (iii)that it is just and convenient to make the order in all the circumstances of the case;

(ab)where the tribunal is satisfied—

(i)that unreasonable service charges have been made, or are proposed or likely to be made, and (ii)that it is just and convenient to make the order in all the circumstances of the case;

(aba)where the tribunal is satisfied—

(i)that unreasonable variable administration charges have been made, or are proposed or likely to be made, and (ii)that it is just and convenient to make the order in all the circumstances of the case;

(ac)where the tribunal is satisfied—

(i)that any relevant person has failed to comply with any relevant provision of a code of practice approved by the Secretary of State under section 87 of the Leasehold Reform, Housing and Urban Development Act 1993 (codes of management practice), and (ii)that it is just and convenient to make the order in all the circumstances of the case; or (b)where the tribunal is satisfied that other circumstances exist which make it just and convenient for the order to be made.

(2ZA)In this section “relevant person” means a person— (a)on whom a notice has been served under section 22, or (b)in the case of whom the requirement to serve a notice under that section has been dispensed with by an order under subsection (3) of that section.

(2A)For the purposes of subsection (2)(ab) a service charge shall be taken to be unreasonable—

4 (a)if the amount is unreasonable having regard to the items for which it is payable, (b)if the items for which it is payable are of an unnecessarily high standard, or (c)if the items for which it is payable are of an insufficient standard with the result that additional service charges are or may be incurred. In that provision and this subsection “service charge” means a service charge within the meaning of section 18(1) of the M2Landlord and Tenant Act 1985, other than one excluded from that section by section 27 of that Act (rent of dwelling registered and not entered as variable).

(2B)In subsection (2)(aba) “variable administration charge” has the meaning given by paragraph 1 of Schedule 11 to the Commonhold and Leasehold Reform Act 2002.

(3)The premises in respect of which an order is made under this section may, if the tribunal thinks fit, be either more or less extensive than the premises specified in the application on which the order is made. (4)An order under this section may make provision with respect to— (a)such matters relating to the exercise by the manager of his functions under the order, and (b)such incidental or ancillary matters,as the tribunal thinks fit; and, on any subsequent application made for the purpose by the manager, the tribunal may give him directions with respect to any such matters. (5)Without prejudice to the generality of subsection (4), an order under this section may provide— (a)for rights and liabilities arising under contracts to which the manager is not a party to become rights and liabilities of the manager; (b)for the manager to be entitled to prosecute claims in respect of causes of action (whether contractual or tortious) accruing before or after the date of his appointment; (c)for remuneration to be paid to the manager by any relevant person, or by the tenants of the premises in respect of which the order is made or by all or any of those persons; (d)for the manager’s functions to be exercisable by him (subject to subsection (9)) either during a specified period or without limit of time. (6)Any such order may be granted subject to such conditions as the tribunal thinks fit, and in particular its operation may be suspended on terms fixed by the tribunal. (7)In a case where an application for an order under this section was preceded by the service of a notice under section 22, the tribunal may, if it thinks fit, make such an order notwithstanding— (a)that any period specified in the notice in pursuance of subsection (2)(d) of that section was not a reasonable period, or (b)that the notice failed in any other respect to comply with any requirement contained in subsection (2) of that section or in any regulations applying to the notice under section 54(3). (8)The Land Charges Act 1972 and the Land Registration Act 2002 shall apply in relation to an order made under this section as they apply in relation to an order appointing a receiver or sequestrator of land.

5 (9)A leasehold valuation tribunal may, on the application of any person interested, vary or discharge (whether conditionally or unconditionally) an order made under this section; and if the order has been protected by an entry registered under the Land Charges Act 1972 or the Land Registration Act 2002, the tribunal may by order direct that the entry shall be cancelled. (9A)the tribunal shall not vary or discharge an order under subsection (9) on the application of any relevant person unless it is satisfied— (a)that the variation or discharge of the order will not result in a recurrence of the circumstances which led to the order being made, and (b)that it is just and convenient in all the circumstances of the case to vary or discharge the order. (10)An order made under this section shall not be discharged by a leasehold valuation tribunal by reason only that, by virtue of section 21(3), the premises in respect of which the order was made have ceased to be premises to which this Part applies. (11)References in this Part to the management of any premises include references to the repair, maintenance, improvement or insurance of those premises.

The Hearing

8. The initial day of the hearing on 26th August 2021 took place remotely by video. [NAME] attended to represent [APPELLANT] and [APPELLANT]. Messrs. [RESPONDENT] and [NAME] attended in person. Ms [RESPONDENT] the nominated manager attended throughout.

9. The Tribunal did not inspect the [NAME] and no party invited them to do so. The Tribunal had seen photographs and descriptions within the bundle as well as having looked at the [NAME] via online resources.

10. Mr [NAME] had filed a skeleton argument.

11. This decision records the most salient parts of the hearing which the Tribunal took account of in reaching its determination. It is not however a transcript of all that took place.

12. Mr [NAME] on behalf of the Respondents confirmed they objected to any variation or extension of the earlier management order being made. He stated that [NAME] would prefer to appoint their own manager.

13. Mr [NAME] explained in his view there were 5 main arguments he wished to present:

• Accounting issues: earlier accounts not reconciled and no accounts from Mr [NAME];

6 • Major works: his clients believe the major works undertaken during the course of Mr [NAME] appointment are sub standard; • Further major works are required; • The relationship between the parties has irretrievably broken down and an independent manager is the most appropriate way forward; • [NAME] have put forward no alternative management plan;

14. Mr [NAME] then called [APPELLANT] who confirmed the contents of her witness statement were true [47-48].

15. Mr [RESPONDENT] then cross examined her.

16. She explained she had arranged for a structural engineer to review the major works undertaken by Mr [NAME]. She did not have a report and could not remember the engineers details.

17. She accepted she had agreed to have [NAME] to replace the previous wooden windows but she would have preferred wooden windows. She had discussed matters with the contractor as would have preferred the windows which were fitted to not have fan lights but to fit the full opening including the sloping edges. She felt the quality of the work undertaken was poor.

18. The Tribunal then asked questions.

19. Ms [APPELLANT] confirmed she raised with the surveyor the question of FENSA certificates or Building regulations approval after she learnt this was required. She stated she was awaiting the guarantees for the work. She had tried to contact Mr [NAME] as the team from his company who were managing day to day she did not feel took her seriously. Mr [NAME] did not engage with her.

20. On re-examination Ms [APPELLANT] confirmed she was not happy with the management by Mr [NAME]. She did not feel the major works had been properly completed. She accepted that so far there had been no leaks.

21. The Tribunal took a short break at this point and upon resumption Mr [NAME] had attended. He explained he was on holiday and had been trying earlier to log on for the hearing. He explained he had not got accounts and had been advised by his accountant these would take a further 8 weeks to produce. He confirmed he was advised his accountant now had all the information he required.

22. The Tribunal invited Mr [NAME] to remain in attendance and highlighted that at the close of the proceedings it would issue further directions.

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23. Ms [APPELLANT] was then called. She confirmed her statement [53- 54] was true and would stand as her evidence.

24. Mr [RESPONDENT] then cross examined.

25. She stated that she believed the earlier accounts did not reflect the previous Tribunal determinations. Items were included which she stated had not been approved. These included items such as supposed finance costs which she said had not been approved.

26. The Tribunal stopped the cross examination on the basis this application was to determine whether or not the appointment of a Manager should be extended and varied to appoint Ms [APPELLANT].

27. The Tribunal had no questions for Ms [APPELLANT].

28. Mr [RESPONDENT] and [NAME] presented their case.

29. Mr [RESPONDENT] was content for Mr [RESPONDENT] to finalise the accounts. He flagged that it was the [NAME] who had fallen out with Mr [APPELLANT] and [NAME] who was their nominated manager. He suggested they contested everything and say all works done are rubbish. He stated that the [NAME] then produce no evidence supporting this.

30. Mr [RESPONDENT] suggested that [NAME] would look to approach a firm called ADJ in Worthing if the management order was not continued and management returned back to them as freeholders.

31. The Tribunal adjourned for lunch. Upon resumption Mr [NAME] did not re-join and did not re-join again on 26th August 2021.

32. Mr [NAME] cross examined the Respondents.

33. Mr [NAME] accepted the previous agents appointed did a bad job. He made clear it was the agents and not himself and Mr [RESPONDENT].

34. Mr [RESPONDENT] explained that they tried to give the previous agents a period of time to get matters right. He and Mr [NAME] believed the Applicants were unreasonable.

35. Mr [NAME] had to be muted by the Tribunal. Mr [NAME] expressed forcibly his dissatisfaction with matters relating to the [NAME] and the numerous applications to the Tribunal. He believed matters could only be resolved if matters proceeded to the Upper Tribunal. The Tribunal explained to him until a decision had been made he would not be able to proceed to the Upper Tribunal and then would only be able to do so if he was granted leave to appeal either by this Tribunal or the Upper Tribunal.

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36. Mr [RESPONDENT] then continued to answer questions.

37. Mr [RESPONDENT] confirmed he had received statements from [NAME]. He stated he had only been made aware immediately prior to the Tribunal application in October 2020 that a Section 22 Notice had been served upon the previous managing agents. He stated that whenever he was asked by the agents he had always agreed to the disclosure of information to the Applicants. He had always wanted to be transparent.

38. Mr [RESPONDENT] confirmed that he and Mr [RESPONDENT] took advice and instructed solicitors who had written to the Applicants seeking recovery of monies which Mr [RESPONDENT] believed was owed. He explained that [NAME] had financed works in 2015 and remained owed monies for the same.

39. Mr [RESPONDENT] confirmed he had no details as to what professional bodies if any ADJ were members of.

40. Mr [NAME] stated that he could not believe this was the eighth tribunal hearing. He felt [NAME] and Mr [NAME] should complete the accounts.

41. The Tribunal then heard from Ms [NAME]. She relied on her statement and attachments [14-26].

42. She explained she had a number of Tribunal appointments ranging from buildings of 2 units up to 70 units. She spoke to her management plan. She believed the [NAME] required an independent manager who would look at matters with a critical eye.

43. She explained that she was born in Worthing so knows the area well. She currently manages two buildings in Lancing. Her minimum fee is £2000 plus vat which is what she proposes for the [NAME]. She stated that in her opinion even at this level she would not earn much money from the [NAME].

44. She felt there were some unrealistic expectations on both sides.

45. Ms [NAME] was questioned by the Tribunal.

46. She explained that she felt relationship management will be key.

47. Mr [NAME] had no questions.

48. Mr [NAME] asked questions.

49. Mr [NAME] confirmed the address of one of the properties in Lancing. She confirmed it had about 20 units and she had

9 managed for about 20 years. She explained she always looks to try and use local contractors and has contacts in the area already.

50. Mr [NAME] commented that he found that [NAME] came across as a confident person.

51. [NAME] and Mr [RESPONDENT] in closing stated they are happy for Ms [RESPONDENT] to be given a period of time but do not accept three years is reasonable. They felt Mr [NAME] should complete the accounts and any matters relating to the major works so that Ms [NAME] started with a clean sheet. They stated that it seems whenever the Applicants received an invoice they find fault and try and delay and confuse matters.

52. Mr [NAME] referred to his skeleton argument. He accepts this is a remedy for a fault being established. He submitted the emphasis should be on an independent manager answerable to the Tribunal only.

53. The Tribunal then agreed certain further directions with the parties for Mr [NAME] to produce the accounts and further explanation of the major works. It was agreed that the parties submissions on 26th August would stand as their case for the application and they were not required to attend the further date which was principally for the Tribunal to question Mr [NAME] as to what had happened during his period of management.

54. The Tribunal confirmed to all present that Mr [NAME] would remain the manager until further Order. The hearing ended and further directions were sent to all parties including Mr [NAME].

55. Between the two hearings Mr [NAME] complied with the directions and supplied accounts, various documents including statement as to what steps had been taken under his management principally in connection with the major works. Both parties submitted submissions in reply as the directions provided.

56. On 24th November 2021 the hearing resumed. Mr [NAME] attended in person with the Applicants attending remotely. [NAME] had wished to attend in person but due to a train derailment they attended by video as well. [NAME] attended the Tribunal in person. Judge Whitney was in person with his panel members attending remotely by video.

57. Mr [NAME] spoke to his bundle of documents and statement supplied. He explained that almost immediately he was appointed the Covid 19 pandemic had struck and the first lockdown was instigated. Mr [NAME] commented that this changed the world and throughout his appointment he had not been travelling as he would have done prior to the pandemic.

10 58. Mr [NAME] accepted he relied on Miss [NAME] and Mr [NAME]. They were father and daughter but were in his evidence experienced [NAME] managers in the employ of [NAME]. They dealt with matters day to day as they were closer to the [NAME] than himself. He had as a minimum weekly meetings with [NAME].

59. He explained that when first appointed he had been told by Ms [APPELLANT] that there were concerns over Mr [APPELLANT] and hence he had appointed [NAME] to look at the major works required. It was only upon the application being made which was heard in October 2020 that he learnt that Ms [APPELLANT] had accepted Mr [APPELLANT] specification.

60. He explained the original contractor had left the site. The contractor said this was due to issues with Miss [APPELLANT]. Mr [NAME] had found another contractor who had completed matters and the whole project came within budget. He accepted there were some outstanding items as identified in Miss [APPELLANT]’s reply to his recent statement but in his opinion these matters were snagging.

61. He confirmed he had spoken to his accountant who was satisfied that the accounts had now been reconciled and those recently produced were accurate. Those accounts had been supplied to all parties.

62. Mr [NAME] then asked questions of Mr [NAME].

63. He agreed that the contract was between Cambridge Construction and himself. He agreed he should have agreed all variations to the contract but this did not take place. He confirmed Mr [NAME] as the surveyor had his authority to deal with matters.

64. Mr [NAME] explained the McGills visited the [NAME] during the management order. He visited with the Applicants prior to his appointment. He had also visited as set out in his statement. He confirmed the bullet point statement had been prepared by [NAME] but he had approved it.

65. Mr [NAME] stated Cambridge Construction were only paid for the work they completed. He had seen the report of [NAME] which the Applicants had now obtained and discussed with [NAME]. [NAME] believed the issues were snagging and would be remedied as such.

66. Messrs. [RESPONDENT] and [NAME] also had opportunity to ask questions of Mr [NAME].

67. Mr [NAME] confirmed Mr [NAME] had been back to the site and was adamant he could resolve the outstanding items.

68. The Tribunal also questioned Mr [NAME].

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69. He confirmed Mr [NAME] had been asked to attend to the snagging process.

70. Mr [NAME] explained he manages a thousand properties. He would self manage until all issues resolved as he would want any manager to have a clean sheet of paper.

71. Mr [NAME] submitted that the situation cries out for a manager. Continuity of appointment is required and so a three year term is reasonable. He stated it was clear there was not a happy relationship and ongoing management is required.

72. Mr [NAME] indicated he sought orders under section 20C that none of the costs of this application would be recovered as a service charge item. He also indicated that he wished to seek an Order pursuant to Rule 13 against Mr [NAME].

73. The Tribunal adjourned to consider. On resumption the Tribunal indicated the Order it intended to make to assist the parties in planning and provided that reasons would follow.

Decision

74. The Tribunal thanks all the parties for their assistance. It was plain that very real tensions existed.

75. We record that the Applicant seeks to vary the original management order dated 3rd March 2020. The Applicant suggests the Order should be extended and the manager appointed should be varied to be Ms [APPELLANT]. The Applicant suggests any appointment should be for three years.

76. We have proceeded on the basis that the Respondents objected to the appointment although by the end of the second hearing it appeared that they accepted it may be in all parties interests for a manager to be appointed but only for 12 months.

77. We do not set out the long and unhappy history between the Applicant and Respondents. It was repeatedly raised by both sides. What was clear was that plainly neither side had any trust or respect for the other. This is important given the only parties in respect of this [NAME] are the those to this application with each being responsible for 50% of the service charge costs.

78. We note the original determination appointing Mr [NAME] had followed a series of determinations criticising the managers appointed by [NAME]. The Tribunal in that instance [31] acknowledged that appointment of a manager was a practical solution to ensure that accounts could be reconciled and major works to what is known as the conservatory completed.

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79. We have considered carefully all of the evidence. Simply because the parties think a manager should be appointed is not the test. Currently there is a Tribunal appointed manager. The major works for which Mr [NAME] was appointed appear to be have been completed subject to certain matters. Accounts have been reconciled. It is however plain from the evidence of the parties that [NAME] have made little or no preparations for having management returned to them. At the August hearing they referred to looking to appoint a manager based in Worthing although no information was produced. At the later hearing Mr [NAME] stated he would self manage.

80. The earlier Tribunal which originally appointed Mr [NAME] determined that the conditions set out in Section 24 of the Landlord and Tenant Act 1987 were met. We must be satisfied that it remains just and convenient for a manager to be in post. On balance we are so satisfied.

81. In our judgment issues still remain between the parties. The Applicants do not accept the accounts prepared by Mr [NAME] properly reconcile the earlier amounts and amounts owed by the Applicants to the Respondents by way of service charges. All such earlier years have been subject to Tribunal determination and it was accepted by both parties that any action to resolve these issues would necessitate County Court proceedings if agreement cannot be reached. It seems the same is likely. Until this is resolved it is not clear to this Tribunal that any working relationship can be established.

82. Taking account of all matters and the submissions made we are satisfied that it remains just and convenient for manager to be appointed. In our judgment any such appointment should be for no longer than may be required. The Respondents are entitled to expect that they can manage their building. We are satisfied that an Order for 12 months is reasonable in all of the circumstances. If issues still remain any party, including the manager, can apply for the order to be varied and extended. A period of 12 months should provide opportunity for any snagging issues to be resolved and for the parties to have determined whatn if any further actions they wish to take over earlier accounts and sums said to be due and owing. On this later point both parties must take their own advice and it will not be for the Manager to become embroiled in the same.

83. We have considered Ms [NAME]. We were impressed with her management plan and they way she gave her evidence. As Mr [NAME] commented she did so with confidence. We are satisfied that she understands her duty to this Tribunal and the need to be independent of the parties. Her previous appointments support this conclusion. We are satisfied she is an appropriate manager.

13 84. We must comment upon Mr [NAME] and his management. We acknowledge that the timing of his appointment in respect of the pandemic could not be worse. The same must have hampered good management given his business is not local to the [NAME]. His failure to comply with the initial directions did however cause difficulties in this case. Whilst we note he referred to difficulties he had experienced in obtaining documents from previous agents to reconcile accounts he had not returned to the Tribunal seeking further directions. Ultimately accounts have been produced together with other documentation which the parties can now consider.

85. As we made clear at the hearing we make no determination as to any of the sums which Mr [NAME] incurred. It was not appropriate within this application to do so.

86. We are satisfied that Mr [NAME] has now reconciled the accounts and the major works to the conservatory have been completed. Mr [NAME] indicated he had given instructions to [NAME] to ensure that snagging items, including those raised in the report obtained on behalf of the Applicants are attended to. Mr [NAME] had produced Building Regulation consent and a guarantee for the windows.

87. Plainly if such information had been produced to the Tribunal sooner then this would have assisted all. We note however Mr [NAME] did as directed attend in person at the resumed hearing and submit to detailed questioning. He was in our judgment candid in his answers.

88. Having said the above we do determine that an Order should be made pursuant to Section 20C and Mr [NAME] should not recover any of his costs of dealing with this application through the service charge.

Conclusion

89. As we advised the parties orally at the conclusion of the hearing we make an order appointing Ms [NAME] from 25th December 2021 until 24th December 2022. Mr [NAME] will remain as the Tribunal appointed manager until 24th December 2021.

90. We have determined such dates given these reflect the service charge years. Mr [NAME] shall comply with paragraph 12 of the management order appointing him [37].

91. Ms [NAME] shall not engage in any work in relation to the earlier accounts and the reconciliation of the same. She will be entitled to rely upon the account supplied by Mr [NAME] unless and until there is any further order of the Tribunal or County Court as appropriate.

14 92. The management order shall provide that the Applicants and the Respondents will each make an interim payment to her of £2000 on account of any and all expenditure she is required to make. Such payment is to be made as Ms [NAME] directs by not later than 14th January 2022.

RIGHTS OF APPEAL

1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to [EMAIL] to the First-tier Tribunal at the Regional office which has been dealing with the case.

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.

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FIRST-TIER TRIBUNAL [NAME] CHAMBER ([NAME])

Case Reference

:

CHI/45UB/LVM/2021/0004

[NAME]

:

[ADDRESS], Shoreham by Sea, West Sussex [POSTCODE]

Applicant: [redacted]

:

Mr [COUNSEL], counsel

Respondent: [redacted]

:

Type of Application

:

Application to vary a management order

Tribunal Member(s)

:

Judge [NAME] [NAME] of Hearing

Date of Decision

:

:

26th August 2021 and 24th November 2021

14th December 2021

MANAGEMENT ORDER

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Interpretation

1. In this Order:

“The [NAME]” means the flats and other premises known as known as 37 [ADDRESS] [POSTCODE].

“The Landlord” shall mean [NAME] and [RESPONDENT] or their successors in title to the reversion immediately expectant upon the Leases.

“The Tenants" shall mean [APPELLANT] and [APPELLANT] being the proprietor for the time being of the Lease whether as lessee or under- lessee and "Tenant” shall be construed accordingly.

“The Lease" shall mean the lease of The Tenants flat in the [NAME].

“The Manager” means Ms [NAME].

“The Tribunal” means the First-tier Tribunal ([NAME] Chamber)

ORDER

2. In accordance with section 24(1) of the Landlord and Tenant Act 1987 (“the Act”) Ms [APPELLANT] is appointed as Manager of the [NAME] in place of Mr [NAME] who was appointed pursuant to an Order dated 3rd March 2021.

3. The Manager’s appointment shall start on 25th December 2021 (“the start date”) and shall end on 24th December 2022 (“the end date”).

4. For the avoidance of doubt this Order does not displace covenants under the Leases and the Tenants remain bound by them. 5. The purpose of this Management Order is to provide for adequate management of the [NAME] which includes taking steps to ensure completion of the major works to the conservatory undertaken during the appointment of Mr [NAME] and in particular any items of snagging.

6. The Manager shall manage the [NAME] in accordance with: (a) the terms of this Order and the Directions set out in below; (b) the respective obligations of the Landlord and the Tenants whereby the [NAME] is demised by the Landlord (save where modified by this Order); (c) the duties of a Manager set out in the Service Charge Residential Management Code (“the Code”) (3rd Edition) or such other replacement code published by the Royal Institution of Chartered Surveyors and approved by the

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Secretary of State pursuant to section 87 Leasehold Reform Housing and Urban Development act 1993; and (d) the provisions of sections 18 to 30 of the Landlord and Tenant Act 1985.

7. From the date this Order comes into effect, no other party shall be entitled to exercise a management function in respect of the [NAME] where the same is the responsibility of the Manager under this Order.

8. The Manager must act fairly and impartially in the performance of her functions under this Order and with the skill, care and diligence to be reasonably expected of a Manager experienced in carrying out work of a similar scope and complexity to that required for the performance of the said functions. The Manager’s overriding duty to this tribunal.

9. Where there is a conflict between the provisions of the Management Order and the Leases, the provisions of the Management Order take precedence.

10. The Manager or any other interested person may apply to vary or discharge this Order pursuant to the provisions of section 24(9) of the Act.

11. Any application to extend or renew this Order must be made before the end date, preferably at least three months before that date, and supported by a brief report of the management of the [NAME] during the period of the appointment. Where an application for an extension or renewal is made prior to the end date, then the Manager’s appointment will continue until that application has been finally determined.

12. The Manager may apply to the First-Tier Tribunal for further directions, in accordance with section 24(4), Landlord and Tenant Act 1987. Such directions may include, but are not limited to:

(a) any failure by any party to comply with an obligation imposed by this Order; and (b) circumstances where there are insufficient sums held by him/her to discharge the Manager’s obligations under this Order and/or for the parties to pay the Manager’s remuneration.

Contracts

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13. Rights and liabilities arising under contracts, including any contract of insurance and/or any contract for the provision of any services to the [NAME], to which the Manager is not a party, but which are relevant to the management of the [NAME], shall upon the date of appointment become rights and liabilities of the Manager, save that:

(a) the Landlord shall indemnify the Manager for any liabilities arising before commencement of this Order; and (b) the Manager has the right to decide in her absolute discretion the contracts in respect of which she will assume such rights and liabilities, with such decision to be communicated in writing to the relevant parties within 56 days from the date this order.

14. The Manager may place, supervise and administer contracts and check demands for payment of goods, services and equipment supplied for the benefit of the [NAME].

Licences to assign, approvals and pre-contract enquiries

15. The Manager shall not be responsible for carrying out those functions in the residential Leases concerning approvals and permissions, including those for sublettings, assignments, alterations and improvements, that the Leases provide should be carried out by the Landlord.

16. The Manager shall be responsible for responding to pre-contract enquiries regarding the sale of a residential flat at the [NAME].

Legal Proceedings 17. The Manager may bring or defend any court or tribunal proceedings relating to management of the [NAME] (whether contractual or tortious) and may continue to bring or defend proceedings relating to the appointment , after the end of her appointment.

18. Such entitlement includes bringing proceedings in respect of arrears of service charge and rent attributable to any of the Flats in the [NAME], including, where appropriate, proceedings before this tribunal under section 27A of the Landlord and Tenant Act 1985 and in respect of administration charges under schedule 11 of the Commonhold and Leasehold Reform Act 2002 or under section 168(4) of that Act or before the courts and shall further include any appeal against any decision made in any such proceedings.

19. The Manager may instruct solicitors, counsel, and other professionals in seeking to bring or defend legal proceedings and is entitled to be reimbursed from the service charge account in respect of costs, disbursements or VAT reasonably incurred in doing so. If costs are

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recovered direct from a defaulting Tenant, those costs should be refunded to the service charge account.

Remuneration

20. The Tenants are responsible for payment of 50% of the Managers’ fees, which are to payable under the provisions of this Order but which may be collected under the service charge mechanisms of their Leases and the Landlord is responsible for payment for the remaining 50% of those fees.

21. The sums payable are:

(a) an annual fee totalling £2000 for performing the duties set out in paragraph 3.4 of the RICS Code (so far as applicable); (b) any additional fees contained in a schedule to this Order for the duties set out in paragraph 3.5 of the RICS Code (so far as applicable); and (c) VAT on the above fees. Ground Rent and Service charge

22. The Manager shall collect the ground rents payable under the residential Leases.

23. The Manager shall collect all service charges and insurance premium contributions payable under the Leases, in accordance with the terms and mechanisms in the Leases.

24. The Manager shall have the authority to:

(a) demand payments in advance and balancing payments at the end of the accounting year; (b) establish a sinking fund to meet the Landlord’s obligations under the Leases; (c) allocate credits of service charge due to Tenants at the end of the accounting year to the sinking fund;

25. To ensure that the Manager has adequate funds to manage the [NAME] the Manager may immediately collect £2,000 from the Tenants and from the Landlords. For the avoidance of doubt both the Tenants and the Landlords shall pay to the Manager £2000 by the 14th January 2021 so that the Manager shall have interim service charge funds totalling £4000. The Manager will take account of such interim payment in

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making any further demands for interim service charge payments which may be allowed under the lease.

26. The Manager is entitled to recover through the service charge the reasonable cost and fees of any surveyors, architects, solicitors, counsel, and other professional persons or firms, incurred by her whilst carrying out her functions under the Order.

Administration Charges 27. The Manager may recover administration charges from individual Tenants for her costs incurred in collecting ground rent, service charges and insurance which includes the costs of reminder letters, transfer of files to solicitors and letters before action. Such charges will be subject to legal requirements as set out in schedule 11 of the Commonhold and Leasehold Reform Act 2002. The Details of the fees charged are set out in the Appendix of additional fees.

Disputes 28. In the event of a dispute regarding the payability of any sum payable under this Order by the lessees, additional to those under the Leases (including as to the remuneration payable to the Manager and litigation costs incurred by the Manager), a Tenant, or the Manager, may apply to the tribunal seeking a determination under section 27A of the Landlord and Tenant Act 1985 as to whether the sum in dispute is payable and, if so, in what amount.

29. In the event of a dispute regarding the payability of any sum payable under this Order by the landlord, other than a payment under a Lease, the Manager or the Landlord may apply to the tribunal seeking a determination as to whether the sum in dispute is payable and, if so, in what amount.

30. In the event of dispute regarding the conduct of the management of the [NAME] by the Manager, any person interested may apply to the Tribunal to vary or discharge the order in accordance with section 24(9) of the Landlord and Tenant Act 1987.

31. The Manager may seek Directions from the Tribunal at any time by making an application under section 24(4) of the Landlord and Tenant Act 1987 and where the Manager is in doubt as to the proper construction and meaning of this Order, he is encouraged to so do.

32. In the event of a dispute regarding the reimbursement of unexpended monies at the end of the Manager’s appointment, the Manager, a Tenant, or the Landlord may apply to the Tribunal for a determination as to what monies, if any, are payable, to whom, and in what amount.

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DIRECTIONS TO LANDLORD 33. The Landlord must comply with the terms of the Order above.

34. On any disposition of the Landlord’s estate in the [NAME], the Landlord will procure from the person to whom the [NAME] is to be conveyed, a direct covenant with the Manager, that the said person will (a) comply with the terms of this Order; and (b) on any future disposition (other than a charge) procure a direct covenant in the same terms from the person to whom the [NAME] is to be conveyed.

35. The Landlord shall give all reasonable assistance and co-operation to the Manager in pursuance of her functions, rights, duties and powers under this Order, and shall not interfere or attempt to interfere with the exercise of any of the Manager’s said rights, duties or powers except by due process of law.

36. The Landlord is to allow the Manager and his employees and agents access to all parts of the [NAME] and must provide keys, passwords, and any other documents or information necessary for the practical management of the [NAME] in order that the Manager might conveniently perform his functions and duties and exercise his powers under this Order.

DIRECTION TO CHIEF LAND REGISTRAR

37. To protect the direction in paragraph 34 for procurement by the Landlord, of a direct covenant with the Manager, the Registrar is ordered to enter the following restriction in the register of the Landlord’s estate. The restriction is to have overriding priority against any search with priority or pending application for a disposition of the registered estate (other than a charge) that has been lodged after the 24th day of November 2021.

“No disposition of the registered estate (other than a charge) by the proprietor of the registered estate, or by the proprietor of any registered charge, not being a charge registered before the entry of this restriction, is to be completed by registration without a certificate signed by the applicant for registration [or their conveyancer] that the provisions of paragraph 34 of an Order of the Tribunal dated 14th December 2021 have been complied with”

DIRECTIONS TO MANAGER

38. The Manager must adhere to the terms of the Order above.

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Registration

39. The Manager must make an application to HM Land Registry for entry of the restriction referred to in paragraph 38, within 14 days of the date of this Order.

Conflicts of Interest 40. The Manager must be astute to avoid any Conflict of Interest between his duties under this order in his contractual dealings or in the discharge of any of his obligations and where in doubt, the Manager should apply to the Tribunal for directions.

Complaints

41. The Manager must operate a complaints procedure in accordance with, or substantially similar to, the requirements of the Royal Institution of Chartered Surveyors.

Insurance 42. The Manager must maintain appropriate building insurance for the [NAME] and ensure that the Manager’s interest is noted on the insurance policy.

43. From the date of appointment, and throughout the appointment, the Manager must ensure that he/she has appropriate professional indemnity insurance cover in the sum of at least £2 million [or £5 million] and shall provide copies of the certificate of liability insurance to the Tribunal, and, upon request, to any Tenant or the Landlord. The Certificate should specifically state that it applies to the duties of a Tribunal appointed Manager.

Accounts 44. The Manager must:

(a) prepare and submit to the Landlord and the Tenants an annual statement of account detailing all monies receivable, received and expended. The accounts are to be certified by the external auditor, if required under the Leases; (b) maintain efficient records and books of account and to produce for these for inspection, to include receipts or other evidence of expenditure, upon request by the Landlord or a Tenant under section 22 Landlord and Tenant Act 1985;

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(c) maintain on trust in an interest-bearing account at such bank or building society, as the Manager shall from time to time decide, into which ground rent, service charge contributions, Insurance Rent, and all other monies arising under the Leases shall be paid; and (d) hold all monies collected in accordance with the provisions of the Code.

Repairs and maintenance

45. The Manager must:

(a) By 31st January 2022 draw up a planned maintenance programme for the period of the appointment allowing for the periodic re-decoration and repair of the exterior and interior common parts of the [NAME] and shall send a copy to the Tenants and to the Landlord; (b) subject to receiving sufficient prior funds: (i) carry out all required repair and maintenance required at the [NAME], in accordance with the Landlord’s covenants in the Leases, including instructing contractors to attend and rectify problems, and is entitled to recover the cost of doing so as service charge payable under the Leases or in accordance with the Order. (ii) arrange and supervise any required major works to the [NAME], including preparing a specification of works and obtaining competitive tenders. (c) liaise with all relevant statutory bodies in the carrying out of her management functions under the Order; and (d) ensure that the Landlord, and the Tenants, are consulted on any planned and major works to the [NAME] and to give proper regard to their views.

46. The Manager has the power to incur expenditure in respect of health and safety equipment reasonably required to comply with regulatory and statutory requirements.

End of Appointment

47. No later than 56 days before the end date, the Manager must:

(a) apply to the tribunal for directions as to the disposal of any unexpended monies;

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(b) include with that application a brief written report on the progress and outcome of the management of the [NAME] up to that date (a “Final Report”); and

(c) seek a direction from the tribunal as to the mechanism for determining any unresolved disputes arising from the Manager’s term of appointment (whether through court or tribunal proceedings or otherwise).

48. Unless the tribunal directs otherwise the Manager must within two months of the end date:

(a) prepare final closing accounts and send copies of the accounts and the Final Report to the Landlord and Tenants, who may raise queries on them within 14 days; and (b) answer any such queries within a further 14 days.

49. The Manager must reimburse any unexpended monies to the paying parties, or, if it be the case, to any new Tribunal appointed Manager within three months of the end date or, in the case of a dispute, as decided by the Tribunal upon an application by any interested party.

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Schedule of Additional Fees

Director £250 + VAT per hour Team Leader £200 + VAT per hour Senior [NAME]/Accounts Manager £200 + VAT per hour [NAME] /Accounts manager £150 + VAT per hour Administrator £50 + VAT per hour