Tenant's Right to Manage Confirmed by First-tier Tribunal

OUTCOME: Allowed

© CROWN COPYRIGHT 2019

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : LON/00BG/LRM/2019/0004 Premises : [NAME], 6 [ADDRESS] [POSTCODE] Applicant : [redacted] : [NAME] Respondent : [redacted] : [COUNSEL] Solicitors Type of Application : S84(3) Commonhold and Leasehold Reform Act 2002 (the Act) – determination whether the applicant has acquired the right to manage Tribunal Members : Judge John Hewitt Mrs [NAME] and venue of Determination : 19 [ADDRESS] [POSTCODE] Date of Decision : 20 March 2019

DECISION

2 The issues before the tribunal and its decisions 1. The single issue before the tribunal was whether the applicant was, on the relevant date, entitled to acquire the right to manage the subject premises.

2. The decision of the tribunal is that the applicant was, on the relevant date, entitled to acquire the right to manage the subject premises.

Accordingly, the acquisition date of the right to manage is the date specified in accordance with the provisions of s90 of the Act.

3. The reasons for this decision are set out below.

Procedural background 4. The Premises comprise a block of self-contained flats which have been sold off on long leases. The respondent is the landlord. A majority of qualifying lessees promoted the formation of the [COMPANY] with a view to acquiring the right to manage conferred in Part 2 of Chapter 1 of the Act.

5. By a claim notice dated 2 November 2018 given pursuant to s79 of the

Act the applicant sought to acquire the right to manage the premises on

15 March 2019.

6. By a counter-notice dated 6 December 2018 given pursuant to s84 of the Act the respondent alleged that the applicant was not entitled to acquire the right to manage the specified premises for a number of reasons, including non-compliance with:

Ss 78(1), 79(2) and (3), (8), 80(3), (4), (8) and (9) of the Act.

Rather unhelpfully the counter-notice was in generic form and in several instances it was either incomplete or it did not provide any details explaining clearly the reasons why it was alleged the statutory requirements had not been met.

7. On 23 January 2019 the tribunal received an application from the applicant pursuant to s80(3) of the Act. Directions were given on 24 January 2019. The parties were notified of the intention of the tribunal to determine the application on the papers to be provided by the parties and without an oral hearing, unless either party requested an oral hearing. The tribunal has not received any such request.

8. The tribunal had before it:

8.1 The application form – to stand as the applicant’s opening statement of case;

8.2 The respondent’s statement of case in answer dated 11 February

2019; and

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8.3 The applicant’s statement of case in reply dated 25 February

2019.

The issues raised by the respondent and the applicant’s response to them and the tribunal’s position on them

9. The issues raised by the respondent in its statement of case are:

9.1 The applicant failed to respond to letters from the respondent’s

solicitors dated 5, 12 and 19 November 2018 and 25, 28 and 30

January 2019 in which they sought numerous documents and

pieces of information concerning steps taken by the applicant as

part of the RTM process;

Applicant’s response:

It was not in the interests of the applicant to correspond with the

solicitors because irrespective of the answers given or materials

supplied the respondent would have served a counter-notice in

any event denying that the applicant had acquired the right to

manage and compliance with the requests would have only

served to increase the costs payable pursuant to s88 of the Act.

Tribunal’s position

The respondent has not cited any statutory provision or other

authority which obliges a [COMPANY] to provide the

materials and information which the respondent sought.

In those circumstances and given the history of experience of the

applicant’s representatives in dealing with RTM applications

concerning the respondent, we cannot say that it was

unreasonable for the applicant to take the line that it did.

Further, some of the information sought by the respondent was

a matter of public record or was obtainable by the exercise of a

right which the respondent chose not to pursue. An example

includes the right granted by s116 Companies Act 2006 to

inspect the register of members.

Thus, we cannot conclude that the failure to respond to the

correspondence of itself in some way precludes the applicant

from acquiring the right to manage.

9.2 The respondent queried whether a notice of invitation to

participate had been given to the [NAME].

Applicant’s response

The applicant appended a copy of the notice to its statement of

case in reply and asserted that the notice was given to the [NAME]

concerned.

Tribunal’s position

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The copy notice appears to be in order. The respondent did not

advance any positive or even prima facie case that such notice

was not given; it simply noted that the [NAME] was not

stated to be a member of the applicant.

We find that the notice of invitation to participate was given to

the [NAME] The respondent complained that the register of members was

not provided.

Applicant’s response

The applicant appended a copy of the current register of

members to its statement of case in reply.

Tribunal’s position

We have already commented on the lack of a positive obligation

on the applicant to provide a copy of the register and the

apparent failure of the respondent to exercise its statutory right

to inspect the register.

We find that the decision of the applicant not to provide a copy

of the register at an earlier stage of the RTM process does not

preclude the applicant from acquiring the right to manage.

9.4 The respondent complained that the applicant did not provide

evidence of service of the claim form on the qualifying lessees.

So far as we can tell from the papers the respondent has not

advanced any positive or even prima facie case that such notice

was not given to those entitled to it.

Applicant’s response

The applicant appended a witness statement made by Mr

[APPELLANT] dated 25 February 2019 to its statement of case in

reply. The gist of that statement was to the effect that such

notices were posted to those entitled to them.

Tribunal’s position

The respondent has not provided any evidence to suggest that

the claim notice was not given to those lessees entitled to it.

We would have preferred that the witness statement of Mr [NAME]

was endorsed with a statement of truth, but the absence of such

a statement is not fatal. We are satisfied that Mr [NAME] has some

experience with the RTM process and of the procedural

requirements to be complied with. In the absence of any

evidence to the contrary, we find we can accept Mr [NAME]

evidence. Thus, we find the claim notice was given to those

entitled to it.

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9.5 As to requirements of the claim notice the respondent

complained first that there ‘may’ be errors in it in that [COMPANY] and [APPELLANT] are incorrectly named as

members of the [COMPANY].

Applicant’s response

The applicant relies upon the register of members it has

appended to its statement of case which records that on 15

October 2018 both [COMPANY] and [NAME] became

members of the company.

Tribunal’s position

The register of members put before us certainly supports the

above contention of the applicant. There is no evidence before us

that that position is not or might not be correct.

We therefore find as a fact that the register before us is correct in

what it purports to record.

9.6 The second complaint was the claim notice contained two errors

of detail:

9.6.1 The date of the lease of [NAME] 4 was given as 17 Dec 2013

whereas it is in fact dated 7 January 2014; and

9.6.2 The terms of flats 1,6,7,9 and 12 were recorded as terms of

125 years from 1 Jan 2012 whereas in fact the terms were

125 years from 1 Jan 2015

The respondent submitted that such errors evidence a failure to

comply with the particulars and requirements of s80(8) and (9)

of the Act.

Applicant’s response

The errors mentioned are admitted. They submit they are minor

and of no consequence to the validity of the claim notice. They

rely upon s81(1) of the Act. That section provides: “A claim

notice is not invalidated by any inaccuracy in any of the

particulars required by or by virtue of section 80.”

The applicant cited the Court of Appeal decision in [ADDRESS] Co [COMPANY] v [COMPANY] [2017] EWCA Civ 89 in

support of its case, and in particular the observation made by Sir

[NAME] in paragraph 77 of his judgment.

Tribunal’s position

We prefer the arguments advanced on behalf of the applicant.

The errors are minor. There is no suggestion by the respondent

that the errors misled or prejudiced the respondent in any way.

The respondent exhibited to its statement of case in answer, a

copy of the register of the freehold interest. The Charges Register

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includes a Schedule of notices of leases registered against the

freehold interest. We infer this document was readily available

to the respondent so that it was able to check the position if

there was any doubt or concern.

We find that these minor errors are excused by s81(1) such that

they do not invalidate the claim notice.

Conclusion 10. In the event and for the reasons given above we determine that on the

relevant date the applicant was entitled to acquire the right to manage

the subject premises.

Judge John Hewitt 20 March 2019

ANNEX - RIGHTS OF APPEAL

1. 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.

2. 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.

3. 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.

4. 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.