Tenant's Request for Manager Appointment Denied by First-tier Tribunal

OUTCOME: Dismissed

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00AT/LAM/2024/0031 Property : [NAME], [ADDRESS] [POSTCODE] Applicants : [redacted] : [COUNSEL] [NAME] of Counsel instructed by [NAME] Respondent : [redacted] :

[COUNSEL], director of [NAME] (Respondent’s managing agents) Type of [NAME] : Appointment of Manager Tribunal members :

Judge P [NAME] R [NAME] J Francis

Hearing : 7 and 8 January 2025 Date of decision : 6 February 2025

DECISION

Description of hearing

The hearing was a face-to-face hearing.

2 Decisions of the tribunal

(A) The [NAME] for the appointment of a manager is refused. (B) The Applicants’ cost applications are also refused. Background 1. The Applicants seek an order appointing [NAME] [NAME] of London Management as manager of the Property under section 24 of the Landlord and Tenant Act 1987 (“the Act”). A preliminary notice under section 22 of the 1987 Act (a “Section 22 Notice”) was served on the Respondent on 14 June 2024. The Respondent does not take issue with the validity of the Section 22 Notice. 2. [NAME] is part of a development which includes communal land and a block known as George Little House. [NAME] itself is a converted Victorian school, with the conversion having been carried out between 2006 and 2008 by [COMPANY].

3. In or around 2017/18, a group of leaseholders from [NAME] (the “Property”) formed the [NAME] [RESPONDENT] (the “Respondent”). This company assumed control of the management of the Property in 2018. On 1 October 2020 [RESPONDENT] (“HMS”) was appointed by the Respondent as its new managing agent and corporate company secretary.

4. The Property is a block comprising 74 flats. The Applicants are the joint sub-tenants of Flat 41, the sub-tenancy having been put in place to enable the Applicants to enter into a ‘shariah compliant’ mortgage. The relevant parts of section 59 of the Act state as follows: (1) In this Act “lease” and “tenancy” have the same meaning; and both expressions include … a sub-lease or sub-tenancy … (2) The expressions “landlord” and “tenant” … shall be construed accordingly.

5. It was accepted by the tribunal prior to, and again at the start of, the hearing that by virtue of section 59 of the Act the Applicants came within the meaning of “tenant” in section 21(1) of the Act and were therefore entitled to apply for an order under section 24 of the Act appointing a manager to act in relation to the Property. [NAME] [RESPONDENT] for the Respondent confirmed that the Respondent accepted this point. Applicants’ case 6. The Applicants have not provided a statement of case, but [NAME] [NAME] has given a written witness statement. This raises various points in support of the [NAME] which will be summarised below.

3 7. [NAME] [NAME] states that as a resident of the building he has the right to be informed about how decisions are made and who is involved in [NAME] them. However, he adds that each time he has requested information from the Respondent his requests have been dismissed. He has also never been invited to attend any Annual General Meetings prior to the one held in early 2024 which only occurred after his legal representatives sent a letter to HMS and to the Respondent. He argues that as a leaseholder he has the right to participate in these meetings to voice his concerns and contribute to the effective management of the building. He adds that the Respondent has consistently failed to involve [NAME] in decision-[NAME] (i.e. leaseholders other than board members) and that the views and requests of those leaseholders are disregarded, with the board [NAME] decisions that primarily serve their own interests rather than fulfilling their duty to act in the best interests of all residents. Furthermore, he states, there are no minutes available for any of these meetings. In addition, he expresses the view that not all directors have been equally involved in decision-[NAME].

8. He complains of unreasonable service charges, stating that the Respondent’s imposition of excessive service charges, without transparency or justification, violates its duty to provide a clear breakdown of how funds are allocated. He states that despite his repeated requests for information, the Respondent has failed to provide an adequate explanation.

9. In his submission the Respondent has failed to address the damage caused by a leak in the Applicants’ flat. Prior to his purchasing the flat, his surveyor identified the leak, and he was informed that the issue had been reported to HMS with assurances that it would be resolved. However, the problem persisted for months, allowing the water damage to worsen without any further action being taken.

10. He states that HMS rarely conducts a tender process for works. Most of the work is carried out by a single contractor regardless of whether this serves the best interests of the leaseholders in the long term. HMS also fail to properly supervise the work being done, leading to poor workmanship throughout the building, including damage to the exterior windows.

11. He adds that the erection of excess scaffolding around the Property has been a major issue, causing not only an eyesore but also leading to significant concerns about the lack of actual workmanship taking place once the scaffolding is up. The prolonged presence of this scaffolding has, he states, led to frustration among residents and poses a risk of negatively impacting property values in the area.

12. He states that the Respondent has repeatedly shown preferential treatment to certain individuals, benefiting select leaseholders while ignoring the rights of others. For example, the existence of the visitor parking bay was never disclosed or communicated to all leaseholders

4 and yet certain leaseholders have been using it. The Respondent also consistently makes decisions that clearly favour its own directors, such as the decision to relocate the [NAME] without consultation with leaseholders. He submits that the [NAME] relocation plan would eliminate the visitor’s parking bay, prevent the installation of much- needed EV chargers, and result in foul odours and an increase in flies and an unsightly appearance near his section of the building. [NAME] [NAME] also complains about the alleged reassignment of parking bays to benefit [NAME] [RESPONDENT] [NAME], one of the [NAME], at the expense of [NAME]. 13. [NAME] [NAME] expresses concern about a lack of proper security for the west car park, where he says that antisocial behaviour has become increasingly common. He also states that the Respondent has failed to keep its word as it has repeatedly promised to redecorate the communal areas of the building in the Applicants’ section but has not done so to date.

14. In relation to the cladding, the Respondent has “put residents' lives at risk through reckless decision-[NAME] and a failure to act in the best interests of the community”. He states that it was revealed that the cladding on the building does not meet safety standards and that he and others are “alarmed” by the Respondent's “mishandling of such a critical safety issue”.

15. He adds that a significant portion of the tower was damaged following a storm, prompting an insurance claim, but that the Respondent accepted a settlement that only covered the repair of the damaged section, neglecting the rest of the tower, which he says calls into question its judgement and commitment to safety. Also, the Respondent’s severe delays in appointing a contractor to address the issue have prolonged the situation. 16. [NAME] [NAME] also refers to what he describes as lying and deception by the Respondent in relation to the visitor parking bays and its “dishonest behaviour” in repeatedly refusing to comply with numerous GDPR requests for personal information.

17. In relation to the directors, [NAME] [NAME] states that the conduct of certain directors has been nothing short of harassment. Ms [NAME], a director, has referred to leaseholders as thugs and spread false rumours that he was responsible for erasing CCTV footage, and she has repeatedly targeted his family, frequently inspecting their deliveries and photographing parcels, as well as screaming throughout the day and banging on the floor all night. [NAME] [NAME] [NAME], a director, has also harassed [NAME] [NAME] and his family, repeatedly calling the police whenever he sees them in the car park, without any valid reason. On multiple occasions, [NAME] [NAME] has insulted [NAME] [NAME] wife and children, [NAME] inappropriate comments about her appearance and clothing. He has also contacted [NAME] [NAME] mortgage provider to make what [NAME] [NAME] characterises as false accusations.

5 18. He states that [NAME] [NAME] is frequently seen in the car park [NAME] threats toward residents' children if they continue playing outside, and on one occasion his actions escalated to the point where a concerned parent reported him to the police. [NAME] [NAME] was also granted special permission to park on the double yellow lines in front of the Applicants’ flat. [NAME] [NAME] requests for the car to be removed, no action was taken even after the car was involved in an accident and began leaking oil, with glass shards scattered around. Then when [NAME] [NAME] in- laws were staying in Flat 60 during the renovation of their property [NAME] [NAME] physically attacked [NAME] [NAME] and his [NAME] in the car park. He then proceeded to erase the CCTV footage, and the Respondent falsely portrayed [NAME] [RESPONDENT] as the victim and [NAME] [RESPONDENT] and his [NAME] as the perpetrators and then used these accusations to prevent the landlord from renewing the tenancy. Since the escalation of this issue to solicitors, HMS and the Respondent have threatened to forfeit the lease for the Applicants’ flat. This has led to legal fees being incurred and has resulted in unnecessary expenses for all leaseholders who now have to bear the cost of these legal fees.

19. HMS and the Respondent have also decided to replace the standard locks on the gas meter cupboards with locks that can only be accessed by a select number of directors.

20. On 27 August 2024, there was an incident where there was confusion over the rights to a parking bay (bay 42). An individual had parked their vehicle in the bay, and instead of following the legal procedure the Respondent hastily called a removal agent to tow the vehicle away. The car belonged to an individual known to [NAME] [NAME] who asked [NAME] [NAME] to intervene to prevent the removal. During his attempt to stop the removal the removal agents employed excessive and dangerous force and the tow truck was moved while he was still inside the vehicle, putting his safety at risk. 21. [NAME] [NAME] also gives an example of what he considers to be a GDPR breach. In the Respondent’s communication with [NAME] regarding a car incident, it unlawfully identified the vehicle that was responsible for the wall damage and in his opinion this disclosure was intended to shame and punish the individual rather than serve any legitimate purpose.

22. He adds that another example of gross management failing came after the Applicants discovered water stains on their ceiling in early June. Ms [NAME] immediately tried to contact HMS to report the leak and was promised a call back, but no call ever came. [NAME] [NAME] then attempted to reach HMS only to be told that they were unavailable. He then contacted the leaseholder of Flat 42, Ms [NAME], as the leak was coming from her apartment, but she did not respond. He then received an urgent call from the leaseholders of Flat 22, who live below him, telling him to rush home as water was pouring into their flat from the ceiling. It then took numerous attempts to file an insurance claim. HMS then insisted that inspections be carried out by Reyvis Property

6 Services, claiming that this was a requirement of the [NAME]. After the leak, an email was mistakenly copied to him by [NAME] [NAME], and in that email [NAME] [NAME] stated his goal to be to "create problems" for [NAME] [NAME] and to "stall the insurance claim".

23. In his skeleton argument, [NAME] [RESPONDENT] makes the point that the Respondent’s response to this [NAME] has come mainly from its managing agents and that whilst a few of the [NAME] have sent emails in support of opposing the [NAME] those appear to be in their capacity of residents rather than as directors. Respondent’s response 24. The Respondent, through HMS, states that it has managed the Property extremely well since October 2020. It also notes that the Applicants are the joint leaseholders of just one flat out of 74 in total and that none of the [NAME] have joined this [NAME] in support. The Respondent has included within the hearing bundle various items of correspondence which it says demonstrate breaches by the Applicants of their lease obligations.

25. With regard to the leak and resulting insurance claim, the Respondent states that HMS dealt with this incident on 10 June 2024 within 3 minutes of receiving a call from [NAME] [NAME]. A loss adjuster was appointed promptly and then the [NAME], via the loss adjuster, took control of the claim. With regard to the wall damage, the Respondent states that this occurred on 27 August 2024 and the [NAME] appointed a loss adjuster.

26. The Respondent has included service charge budgets for 2021 to 2024 and service charge accounts for 2021 to 2023 in the hearing bundle. There is also a report on the cladding issue, and the Respondent comments that the issue is complex because the [NAME] is involved but that the remediation of the Tower and penthouses is expected to be fully funded by the [NAME] and that it is hoped that the works can be completed within 3 to 6 months after the date of the Respondent’s written statement.

27. The Respondent has provided copies of what it considers to be key correspondence with leaseholders from December 2021 onwards. The hearing 28. [NAME] [NAME] was given the opportunity to speak at length to explain his case. It is not appropriate to record every single thing that he said, but what follows is a summary of what are considered to be the main points.

29. As regards the payment of service charge, [NAME] [NAME] said that he initially withheld payment of service charges due to his various concerns but then he paid under protest. He was asked about his claim that the service charges were unreasonable but was unable to

7 substantiate this claim. Regarding the [NAME] issue, he felt that the decision to move the [NAME] was detrimental to him and he was aggrieved at the lack of consultation.

30. In relation to the car parking issues, [NAME] [NAME] said that HMS had not been transparent regarding the availability for use of the visitor parking space and was concerned that [NAME] [NAME] appeared to have been given favourable treatment by being allowed to leave his car on a double yellow line for two months. He also felt that he had been labelled as a troublemaker by HMS once he had complained about the [NAME] and said that he did not receive responses to various concerns subsequently raised by him. 31. [NAME] [NAME] referred the tribunal to copy emails of support which he said had come from [NAME]. All of these emails were redacted, and he accepted that it was therefore unclear who had sent them, but he said that [NAME] with concerns were afraid to reveal their identity. 32. [NAME] [NAME] also referred the tribunal to a long letter of complaint to the Respondent from his solicitors to which they had not received a response. In addition he referred the tribunal to an email from [NAME] [NAME] dated 23 June 2024 which had clearly been sent to [NAME] [NAME] by accident and which stated “He [[NAME] [NAME]] has had legal advice. We will not acknowledge it - we will only deal with the bank. We will chat with [NAME] but I would like to return it to the bank - he had not paid it prior to the insurance claim and we may want to go for forfeiture via Dewstar - of course that will never happen but we have to create problems for him. We want to stall the insurance claim”. 33. [NAME] [NAME] also referred the tribunal to an email also dated 23 June 2024 from [NAME] [RESPONDENT] to the Applicants’ landlord complaining about [NAME] [RESPONDENT] conduct, commenting that [NAME] [NAME] complaints had been fabricated and that [NAME] [NAME] had been trying to intimidate him into vacating. He also mentioned the Respondent’s unwillingness to allow a tenancy agreement in relation to Flat 60 in favour of members of the Applicants’ family, citing this as another example of victimisation of him and his family. In addition, he showed the tribunal certain WhatsApp messages and referred the tribunal to conversations recorded on video that he regarded as inappropriate. He also complained about HMS objecting to the Applicants keeping more than one cat in their flat and felt that they were being discriminated against.

34. Although this issue does not seem to have been covered by his witness statement, [NAME] [NAME] also complained about a charge of £17,000 by way of legal fees in connection with alleged breaches of covenant by the Applicants, but he denied that there had been any breaches. 35. [NAME] [RESPONDENT] for the Respondent said that the management of the Property was running very smoothly until early 2024 when the

8 Respondent complained to the Applicants’ landlord that the Applicants were in breach of their lease. In relation to the cladding issue, [NAME] [RESPONDENT] said that the Respondent was expecting to be awarded a grant for the necessary work. 36. [NAME] [NAME] complaints that he had not been invited to annual general meetings, [NAME] [NAME] said that whilst the Applicants had been treated as leaseholders (contrary to [NAME] [NAME] view) they were not members of the [COMPANY]. As for the [NAME], [NAME] said that this issue arose well before HMS were appointed but that once appointed HMS explained the issue to all leaseholders, including the fact that planning permission was needed before any relocation could occur. It was felt that it would be sensible to move the [NAME] to the periphery, but the Respondent was working with the freeholder and no final decision had been taken. The [NAME] issue was then put on hold in order to deal with the more pressing cladding issue. He accepted that in its current location the [NAME] was near to [NAME] [NAME] and that he stood to gain from its being moved, but he had not just been dealing with [NAME] [NAME] in trying to resolve the [NAME] issue – he had been liaising with the board of directors as a whole. 37. [NAME] [NAME] accepted that his email of 23 June 2024 did not reflect well on him, but he said that he was just expressing his anger because of [NAME] [NAME] own behaviour, including blocking [NAME] [NAME] car in for several hours because of [NAME] [NAME] own anger in connection with a specific incident. Regarding the allegation that by objecting to the Applicants having more than one cat HMS were picking on them, [NAME] [NAME] denied this and said that [NAME]’ breaches of covenant were also enforced and that there was a genuine safety concern about cats running around in the internal common parts. 38. [NAME] [NAME] accepted that there were no minutes of meetings, saying that decisions were instead taken and recorded by exchange of emails, and he accepted that prior to 2024 the previous annual general meeting of members had been held in 2020.

39. Regarding the long letter of complaint from the Applicants’ solicitors, [NAME] [NAME] said that he had acknowledged it by email but accepted that he had not provided a substantive response. His explanation was that there was a lot going on at that time and he prioritised dealing with the individual issues.

40. In relation to what [NAME] [NAME] had characterised as the visitor parking space, [NAME] [NAME] said that there was no mention in any of the leases of there being a visitor parking space; there just happened to be a spare space. As to whether [NAME] [NAME] had that space re-assigned to him and, if so, whether that was fair, [NAME] [NAME] said that this decision would not have been made by the Respondent but rather by the freeholder. 41. [NAME] [RESPONDENT] for the Applicants put it to [NAME] [NAME] that [NAME] [NAME] had reported to HMS in 2021 that water was leaking from a downpipe. [NAME]

9 [NAME] accepted this and said that HMS had then dealt with the issue immediately. [NAME] [NAME] also put it to [NAME] [NAME] that there had been no communal redecoration since 2021; [NAME] [NAME] agreed and said that this was because there were insufficient funds in place. 42. [NAME] [NAME] also asked [NAME] [NAME] whether he had any evidence to support his written witness statement to the police dated 28 October 2024 in which he stated that “HMS, its employees and the Directors of [NAME] [COMPANY] believe that [NAME] [NAME] may be involved in an illegal scheme where vehicles, possibly stolen, are stored in residential car parks such as that at the [NAME] development until they can be sold for monetary profit”. In response, [NAME] [NAME] pointed out that he had only stated “may” be involved, but he conceded that he did not have any supporting evidence. Proposed manager 43. The proposed manager attended the hearing and was asked questions by [NAME] [RESPONDENT] on behalf of the Respondent and also by the tribunal. Closing submissions at hearing Applicants’ closing submissions 44. [NAME] [NAME] said that the behaviour on which the Applicants were relying in support of their [NAME] was (i) a failure to evidence decision-[NAME] regarding the bin relocation and [NAME] [NAME] use of the extra parking space, (ii) conflicts of interest leading to unfair decisions such as allowing [NAME] [NAME] to park on a double-yellow line, (iii) a failure to communicate with leaseholders generally, (iv) a failure to deal with maintenance/disrepair, (v) a failure to assist the Applicants with their insurance claim or even an active attempt to delay it, (vi) a delay in dealing with the cladding issue, (vii) a failure to redecorate, (viii) harassment of [NAME] [NAME] and his family and (ix) excessive legal fees. 45. [NAME] [NAME] said that HMS had treated the Applicants and their family unfairly and had not made much effort in relation to these proceedings in that there were no witness statements or written explanations from the [NAME] nor was there any written evidence of resolutions passed.

46. In relation to the [NAME], the Applicants believed that the driver for the wish to relocate it was the fact that two of the [NAME] wanted to be further away from the smell. There was no evidence of a fair and proper decision-[NAME] process having taken place, and this was also the case with the parking space and illegal parking issues. As regards communication, there had been no substantive communication with the Applicants since December 2023.

47. The Respondent had failed to deal properly with maintenance and damp issues, including with the insurance claim arising out of the leak. Specifically on the insurance claim, the claim for the flat below that of

10 the Applicants had been dealt with but the Applicants’ claim had not. The Respondent had also failed to deal promptly with the cladding issue through delays by HMS in submitting proper applications as the relevant fund opened for applications in November 2022, but the Respondent did not apply until August 2023.

48. The actions of [NAME] [NAME] and [NAME] [NAME] witness statements to the police both amounted in the Applicants view to harassment of them and their family. Regarding the legal costs issue, the Applicants felt that £17,000 in legal fees for what appeared to them to be just for the writing of three letters was excessive and it suggested that the imposition of such high charges was being used as a pressure tactic on [NAME] [RESPONDENT]. Respondent’s closing submissions 49. [NAME] [RESPONDENT] accepted with the benefit of hindsight that he could have spent more time in responding the detailed points contained in the Applicants’ statement of case, but he said that he was more focused on showing what HMS had actually done by way of management.

50. He reiterated that everything had been running smoothly between 2018 and March/April 2024 and that the police had confirmed that there had been no problems on the estate prior to March/April 2024. He accepted that he had become angry with [NAME] [NAME] but said that this was in response to [NAME] [NAME] having boxed his car in for no good reason for several hours.

51. As regards the cats, [NAME] [NAME] was adamant that they represented a trip hazard and said that [NAME] had been treated in the same way as the Applicants when in breach of the terms of their lease. As regards the downstairs flat’s insurance claim being resolved more quickly, this had nothing to do with HMS or the Respondent – both claims were handed over as quickly as possible for the [NAME] to deal with.

52. As for the bin relocation issue, the correspondence in the hearing bundle showed that it was quite complicated, although [NAME] [NAME] accepted that the original consultation probably could have been handled better. In relation to the spare parking space, [NAME] [NAME] understanding was that the freeholder had allowed [NAME] [NAME] to use it on a temporary basis, but in any event the decision did not belong to the Respondent. In relation to the parking on a double-yellow line, the ultimate decision rested with [NAME] but HMS did ask him to move the car.

53. In relation to repair and maintenance, [NAME] [NAME] said that HMS usually deal with issues quickly, for example gutter cleaning, but that they had to be careful with how much they spent. In relation to the cladding, HMSD immediately organised reports when appointed and they started the section 20 process in mid 2021. The section 20 process then had to be re-done because the Government changed the rules. HMS then tried but failed to obtain funding from the Building Safety

11 Fund and then tried another fund. A package had now been submitted to the [NAME] for funding. So in his submission HMS had used all reasonable efforts to resolve the cladding issue at minimal cost to leaseholders.

54. As for the complaints of harassment, the issues were between [NAME] [NAME] and [NAME] [NAME], and HMS had tried not to get involved. [NAME] [NAME] accepted, when asked, that it might be appropriate for [NAME] [NAME] to step down as a director given the personal conflicts that had arisen. Tribunal’s analysis 55. As noted above, the Applicants are sub-tenants but we accept that by virtue of section 59 of the Act the Applicants come within the meaning of “tenant” in section 21(1) of the Act and are therefore entitled to apply for an order under section 24 of the Act appointing a manager to act in relation to the Property.

56. Under section 22(1) of the Act, “Before an [NAME] for an order under section 24 is made in respect of any premises to which this Part applies by [NAME] of a flat contained in those premises, a notice under this section must (subject to subsection (3)) be served by the tenant on (i) the landlord and (ii) any person (other than the landlord) by whom obligations relating to the management of the premises or any part of them are owed to the tenant under his tenancy”. We are satisfied that this sub-section has been complied with, and the Respondent has not contested this point.

57. The parts of section 24 of the Act on which, based on [NAME] [NAME] skeleton argument, the Applicants seek to rely provide as follows:- “(1) The appropriate tribunal may, on an [NAME] 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 property, or (b) such functions of a [NAME], or both, as the tribunal thinks fit.

(2) The appropriate tribunal may only make an order under this section … (a) where the tribunal is satisfied … that any relevant person is in breach of any obligation owed by him to the tenant under his tenancy and relating to the management of the premises … and 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; … (ac) where the tribunal is satisfied – (i) that any relevant person has failed to comply with any relevant provision of a code of practice … and … (ii) that it is just and convenient to make the order in all the circumstances of the case; or

12 (b) where the tribunal is satisfied that other circumstances exist which make it just and convenient for the order to be made.” 58. The test is therefore a twofold test; the tribunal must be satisfied that one or more of the fault-based gateways set out in section 24(2) exist and also that it is “just and convenient” to make an order for the appointment of a manager.

59. On the basis of the information provided by the Applicants, we are not satisfied that unreasonable service charges have been made as the Applicants have been unable to provide actual credible examples of unreasonable service charges. However, we accept that it is at least arguable that the Respondent has committed breaches of certain obligations owed to the Applicants as a leaseholder and also that certain other events have occurred which have caused the Applicants problems.

60. There is some credible evidence that the Applicants have not always been treated fairly. [NAME] [NAME] email of 23 June 2024, which was inadvertently copied to [NAME] [NAME], suggests an antipathy to [NAME] [NAME] which in turn was affecting the way in which [NAME] [NAME] was treating [NAME] [NAME]. [NAME] [NAME] accepted at the hearing that the email did not reflect well on him, but he said that he was just expressing his anger because of [NAME] [NAME] own behaviour, including blocking his car in. [NAME] [NAME] also by his own admission failed to respond substantively to a long letter of complaint from the Applicants’ solicitor.

61. As regards the Applicants’ complaints about certain directors, the evidence to support the complaints in relation to Ms [NAME] is quite thin, whereas the complaints about [NAME] [NAME] seem to have more substance. It is far from ideal that neither [NAME] [NAME] nor any other directors have given any witness statements on which they could have been cross-examined, but ultimately the arguments between [NAME] [NAME] and [NAME] [NAME] appear largely to be personal to them and are not by themselves reflective of poor management by the Respondent. In addition, by his own admission [NAME] [RESPONDENT] was not totally blameless himself.

62. As for the issues relating to the [NAME], visitor parking and illegal parking, having seen and heard both parties’ evidence we are not persuaded that these show serious management failings. The [NAME] issue is not one on which a decision has yet been made and in any event much of the Applicants’ case on this issue is based on their belief as to other people’s motives without any supporting evidence. On the visitor parking and illegal parking issues, there is no real evidence that the Respondent was in control in relation to either of these issues or (even if it was in control) that it made a very poor management decision.

63. In relation to members’ meetings, it is not the case that the Applicants were members of the [COMPANY]; their landlord was a member but

13 that membership did not get passed down to the Applicants simply by virtue of their having been granted a sub-lease.

64. In conclusion in relation to the first limb of the test, there is limited evidence of a limited number of failings but (a) such failings are in our view relatively minor in the context of an appointment of manager [NAME] and (b) most of them are reflective of disagreements and animosity between individuals rather than evidence of wider management failings. However, we would just emphasise at this point that this does not mean that the Applicants’ concerns do not matter. We accept that the Applicants are genuinely upset about various things that have happened, and we are not suggesting that they are wrong to be upset. In addition, we do have concerns about the lack of witness statements by any of the [NAME] on which they could have been cross-examined and about the general lack of formality in decision-[NAME] including no minutes of meeting. We are also unimpressed by what we consider to have been [NAME] [NAME] overly dismissive approach – both in writing and at the hearing – to [NAME] [NAME] concerns, as well as his written witness statement to the police in which he stated – seemingly without evidence – that HMS and others believe that [NAME] [NAME] might be involved in an illegal scheme.

65. Nevertheless, it remains the case that, in our view, the Applicants’ case on the first limb of the test is limited. Furthermore, even if we were to accept that the first limb of the test has been satisfied we also need to be satisfied in respect of the second limb, namely that it is “just and convenient” for the order to be made. In relation to this second limb of the test, in our view the Applicants’ submissions do not even come close to satisfying us that it would be just and convenient to make an order for the appointment of a manager in this case.

66. The [NAME] for the appointment of a manager is quite a draconian one, in that the tribunal is being asked to remove from a landlord or (in this case) an [COMPANY] its right to manage the property in question. A tribunal should not lightly decide to remove that right from a landlord or from an [COMPANY].

67. In this case, whilst the Applicants claim that there are [NAME] who are unhappy with the standard of management, there is no proper evidence before us that any of the [NAME] are dissatisfied. There is no evidence before us of unreasonable service charge demands, and the issues in respect of which there is at least some credible evidence are mainly inter-personal issues. There is no evidence before us to support the Applicants’ claim that the Respondent generally disregards the views of all leaseholders other than certain directors nor to support their general complaint about how works are undertaken. We also prefer the Respondent’s evidence to that of the Applicants on the cladding and leak/insurance claim issues, and the legal fees issue has been raised seemingly as an afterthought without sufficient detail.

14 68. In our view, therefore, this [NAME] is misconceived. Where there is a genuine grievance about how someone has behaved there are various options open to the aggrieved party as to how to resolve the dispute and/or to seek redress. It may also be the case that certain of the Applicants’ concerns would justify some reduction in management fees. However, to apply for the [COMPANY] as a whole to be stripped of its right to manage the Property where there is no proper evidence of unremedied, ongoing serious management failings and where no [NAME] have been shown to share the Applicants’ concerns is wholly disproportionate and is not a proper basis for the tribunal to appoint a manager.

69. In conclusion, in our view there is no credible reason for concluding that it would be just and convenient to appoint a manager. Applicants’ cost applications 70. The Applicants have applied for a cost order under section 20C of the 1985 Act (“Section 20C”) and for a cost order under paragraph 5A of Schedule 11 to the Commonhold and Leasehold Reform Act 2002 (“Paragraph 5A”).

71. The relevant parts of Section 20C read as follows:- (1) “[NAME] may make an [NAME] for an order that all or any of the costs incurred, or to be incurred, by the landlord in connection with proceedings before … the First-tier Tribunal … are not to be regarded as relevant costs to be taken into account in determining the amount of any service charge payable by the tenant …”. The relevant parts of Paragraph 5A read as follows:-“[NAME] of a dwelling in England may apply to the relevant … tribunal for an order reducing or extinguishing the tenant’s liability to pay a particular administration charge in respect of litigation costs”.

72. The Section 20C [NAME] is therefore an [NAME] for an order that the whole or part of the costs incurred by the landlord in connection with these proceedings cannot be added to the service charge. The Paragraph 5A [NAME] is an [NAME] for an order that the whole or part of the costs incurred by the landlord in connection with these proceedings cannot be charged direct to the Applicant as an administration charge under his lease.

73. The Applicants’ main [NAME] (i.e. the [NAME] for the appointment of a manager) has been dismissed, and we consider that the decision to make that [NAME] was misconceived. In the circumstances it would not be appropriate to make a Section 20C Order or a Paragraph 5A Order and we decline to do so.

15 Name: Judge P Korn Date: 6 February 2025

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 [NAME] for permission must be made to the First-tier Tribunal at the regional office which has been dealing with the case. The [NAME] for permission to appeal must arrive at the regional office within 28 days after the tribunal sends written reasons for the decision to the [NAME]. If the [NAME] is not made within the 28-day time limit, such [NAME] 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 [NAME] for permission to appeal to proceed, despite not being within the time limit. The [NAME] 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 [NAME] the [NAME] is seeking. If the tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).