The Law Commission

PART III

THE CASE FOR REFORM: THE LEGGATT REPORT

Introduction

3.1      In this Part we provide an introduction to the tribunals which are within our terms of reference, and set the case for their reform in the context of the principles that emerged from the Leggatt report.

The project tribunals

3.2      The eight tribunals within our terms of reference^[1] are as follows:

(1) Adjudicator to HM Land Registry,^[2]

(2) Agricultural Land Tribunal,

(3) Commons Commissioners,

(4) Lands Tribunal,

(5) Leasehold Valuation Tribunal,

(6) Rent Assessment Committee,

(7) Rent Tribunal and

(8) Valuation Tribunal.

3.3      We refer collectively to all eight tribunals as the "project tribunals". The Leasehold Valuation Tribunal, Rent Assessment Committee and Rent Tribunal are grouped together within the Residential Property Tribunal Service, and are referred to collectively as the "RPTS tribunals".^[3]
3.4      These eight tribunals all have a role that requires them to value or adjudicate on interests connected with land. The project tribunals adjudicate on disputes that can affect people's homes, land and livelihoods.^[4] They have exclusive jurisdiction over a large number of issues that would otherwise be decided by the courts. In 2001/2002, the project tribunals decided 42,180 cases between them in England and Wales.^[5] The total number of full and part-time chairs and members within the "pool" of members of these tribunals was 2,603.^[6]
3.5      An overview of each of the project tribunals and a full analysis of each tribunal's jurisdiction can be found in our consultation paper.^[7] We set out here a brief introduction to each of the tribunals. A diagram of the current structure of the project tribunals is at Appendix A.

Adjudicator to HM Land Registry

3.6      The Adjudicator is a new tribunal established under the Land Registration Act 2002.^[8] The office-holder will have jurisdiction to determine certain disputes arising under that Act, most notably disputes between a person who has made an application to the Land Registry registrar and a person who has objected to that application.^[9]
3.7      Although no cases have been decided by the Adjudicator, we can have some idea of how this tribunal might work by looking at the adjudication of disputes by the Solicitor to HM Land Registry,^[10] who carries out a similar task at present (although the Adjudicator will also have an additional jurisdiction relating to access to the Land Registry Network).^[11]

Agricultural Land Tribunal

3.8      The Agricultural Land Tribunals have jurisdiction to decide some disputes between agricultural landlords and tenants, mainly under the Agricultural Holdings Act 1986. The tribunals' caseload is at present declining because, broadly speaking, it has no jurisdiction to hear cases relating to tenancies created on or after 1 September 1995. For tenancies created on or after this date, the main dispute resolution mechanism is arbitration.

Commons Commissioners

3.9      The Commons Commissioners adjudicate on disputes relating to the registration of land as common land or as a town or village green under the Commons Registration Act 1965. The Commissioners' limited jurisdiction extends only to disputes which relate to land which was so registered before 2 January 1970. Registrations made after this period are adjudicated by the Commons Registration Authority. The Commons Commissioners do not therefore at present have a large caseload,^[12] although there are proposals to increase their areas of work.^[13]

Lands Tribunal

3.10      The Lands Tribunal was established by the Lands Tribunal Act 1949. A number of jurisdictions have been allocated to the tribunal over time and it now has a relatively diverse jurisdiction over both first instance and appellate cases. The majority of its first instance cases are land compensation and compulsory purchase cases. The tribunal also hears all appeals from the Leasehold Valuation Tribunal and some Valuation Tribunal appeals.^[14]

Tribunals within the Residential Property Tribunal Service

3.11      The Leasehold Valuation Tribunal, Rent Assessment Committees and Rent Tribunals are grouped together under the Residential Property Tribunal Service. The common theme is that the three tribunals have jurisdiction to decide various disputes relating to leasehold property. The tribunals effectively function as a single unit with a common administration.

Leasehold Valuation Tribunal

3.12      The Leasehold Valuation Tribunal has over time emerged as the most important tribunal among the RPTS tribunals and is set to take on a wider range of jurisdictions under the Commonhold and Leasehold Reform Act 2002. The Leasehold Valuation Tribunal mainly hears cases relating to service charges, insurance and the appointment of managers, as well as leasehold enfranchisement cases. Additional jurisdictions under the Commonhold and Leasehold Reform Act 2002 will include a broad power to decide all aspects of service charge disputes, an almost exclusive jurisdiction over a new no-fault right to manage, powers to vary certain leases and some powers in relation to forfeiture.^[15]

Rent Assessment Committee

3.13      The Rent Assessment Committees hear appeals from decisions of the rent officer relating to fair rents for regulated tenancies. This jurisdiction is declining as rent officers are no longer able to issue certificates of fair rent in respect of lettings made on or after 15 January 1989.^[16] Rent Assessment Committees also decide cases about open market rents for assured tenancies in certain circumstances.

Rent Tribunal

3.14      The jurisdiction of the Rent Tribunals concerns restricted contracts under the Rent Act 1977. No restricted contracts could be entered into on or after 15 January 1989 except in very limited circumstances,^[17] and the Rent Tribunals are as a result now almost non-existent in practice.

Valuation Tribunal

3.15      Valuation Tribunals exercise jurisdiction over valuation decisions relating to local government finance. They mainly deal with disputed valuations of property which have been made for the purpose of council tax or business rates.^[18]

The Leggatt principles

3.16      The Leggatt report provided the impetus for reform of these tribunals. The report called for an expert decision-making forum for land, property and housing disputes.^[19] In the broader context of the tribunal system as a whole, the report set out a number of important principles which should inform the future development of a unified tribunals system.
3.17      The Leggatt report has been accepted by the Government as the way forward for tribunals.^[20] Although, of the project tribunals, only the Lands Tribunal is initially to be included within the Government's unified Tribunals Service, the logic of the Leggatt principles applies to all tribunals which offer a service to the public. Our terms of reference require us:

"In the context provided for the future of tribunals by the report of the Leggatt Review of Tribunals and the Modernising Tribunals programme, to review the law relating to the tribunals listed below, including their procedures and composition, and in particular the relationship between the jurisdictions of those tribunals and that of other courts or tribunals, with the aim of making recommendations to ensure that the objectives of the Leggatt Review, as identified in its terms of reference, are met in relation to the work of those tribunals."^[21]

3.18      The role of our project is therefore to apply the Leggatt principles to the reform of the project tribunals in the way that will best suit those particular tribunals. The recommendations and the implications of the Leggatt report mean that, unusually for a Law Commission project, we cannot recommend making no change at all.
3.19      We discussed the principles of the Leggatt report in our consultation paper.^[22] Given the vital role of the Leggatt principles in informing our recommendations for reform, we set out the principles again below.
3.20      The Leggatt report emphasised the importance of a tribunal system which was independent, coherent, professional, cost-effective and user-friendly. We examine here in more detail the three key principles of independence, coherence and user-friendliness.

Independence

3.21      A key concern of the Leggatt report was that "tribunals currently administered by departments with policy responsibilities or whose decisions are tested in the tribunal, are not sufficiently independent."^[23] The report highlighted the fact that tribunals must give users the necessary confidence in their independence and effectiveness. Users must feel that tribunals are genuinely and demonstrably independent.^[24] It was said that tribunals will only retain users' confidence in so far as they are seen to demonstrate similar qualities of independence and impartiality to the courts.^[25]
3.22      The issue is one of the perceived, rather than the actual, independence of tribunals. The report noted that there is no question of the Government improperly attempting to influence individual decisions. Nevertheless, the report said, it cannot be said with confidence that tribunals are demonstrably independent.^[26] The report found that the perception of independence can be hindered by the fact that most tribunals have administrative support, expenses, accommodation and IT support provided by their sponsoring Government departments.^[27]
3.23      The importance of reinforcing a perception of independence is clearest in the case of citizen and state tribunals, where the sponsoring Government department is often one of the parties to the case before the tribunal. However, the perception of independence is an important issue in all tribunals, including those which deal with disputes between private parties. The Leggatt report pointed out that independence can be severely compromised if a culture develops in which tribunal members are seen by departments and ministers as an integral part of policy development and the subsequent delivery of policy. This was said to be a possibility when the same department is responsible for developing new initiatives and administering the tribunal, and senior members and managers of the tribunal are involved in the development of new policies and legislation as part of the same organisation.^[28]

Coherence

3.24      The Leggatt report found that the present set of tribunals has developed in a haphazard way, and that there is a wide variety in the practice and approach of different tribunals, with almost no coherence.^[29] The report was concerned that the current systems of administrative support are not meeting the needs of tribunals or users.^[30] The report stated that a programme of improvements to information, tribunal procedure, case management, member recruitment, training and IT could not be taken forward in the absence of greater tribunal co-ordination without disproportionate expenditure and duplication of effort.^[31]
3.25      The Leggatt vision was "to present the citizen with a single, overarching structure" to make the system clearer and simpler for users. It was said that this would also assist citizens being directly involved in preparing and presenting their own cases.^[32] The report highlighted some of the problems caused by tribunals' present isolation from each other: disparities in IT systems, difficulties in retaining suitable staff because of limited career prospects, problems caused by some larger tribunals having under-used accommodation while smaller tribunals are unable to find hearing venues, and general duplication of effort.^[33]
3.26      The Leggatt report's response to this lack of coherence was to recommend a Tribunals System, administered by a unified Tribunals Service, which would be under the control of the Lord Chancellor's Department. The report stated that "centralising tribunal administration under a single minister would make it much more likely that there would be a joined-up and modernised service."^[34] The report concluded that the assumption of responsibility for all tribunals by the Lord Chancellor instead of by sponsoring departments is the only way in which users can be satisfied of tribunals' independence.^[35]

User-friendliness

3.27      The Leggatt report underscored the fact that tribunals exist to serve tribunal users, and that tribunals need to be readily accessible to these users. Two key factors were identified: information for users and independent help and support for them. The view taken in the report was that with good quality information and advice, the need for users to be professionally represented at tribunals should decrease.^[36]

The way forward

3.28      The Leggatt report has made an important impact on thinking about the future of tribunals. The report highlighted fundamental ways in which the tribunal system could be improved to ensure it provides a high standard of service of administrative justice to citizens. The main argument of the Leggatt report was that tribunals must be reformed so as to become more coherent, independent and user-friendly, in order to provide the best possible service for the public. This argument has now been accepted by the Government as the way forward for tribunal reform.
3.29      Our objective is to apply the principles of coherence, independence and user-friendliness to the project tribunals. Our proposed reforms are therefore as much as possible based on the application of these key principles to the project tribunals.

Note 1    Our terms of reference are set out in para 1.2 above.    [Back]

Note 2    The Adjudicator to HM Land Registry was not specifically included within our terms of reference, but it was agreed by the Law Commission and the Lord Chancellor’s Department that the Adjudicator would be included in the review.     [Back]

Note 3    See further para 3.11 below.    [Back]

Note 4    For example, a Chairman of the Agricultural Land Tribunal told us that in Agricultural Land Tribunals a user’s “very livelihood may be at stake.”    [Back]

Note 5    Data from Council on Tribunals Annual Report for 2001/2002 (2002) HC 14. The figures broken down are: Agricultural Land Tribunal 31 cases (England) plus 5 cases (Wales); RPTS tribunals 6,608 cases (England) plus 143 cases (Wales); Valuation Tribunal 33,546 cases (England) plus 1,706 cases (Wales); Commons Commissioners 2 cases (England); Lands Tribunal 139 cases (England and Wales). The potentially misleading nature of the statistics for the Valuation Tribunal is discussed at para 4.32 below.     [Back]

Note 6    Data from Council on Tribunals Annual Report for 2001/2002 (2002) HC 14. The figures broken down are Agricultural Land Tribunal 238 (England) plus 37 (Wales); Commons Commissioners 1 (England); Lands Tribunal 5 (England and Wales); RPTS tribunals 371 (England) plus 37 (Wales); Valuation Tribunal 1,608 (England) plus 234 (Wales).    [Back]

Note 7    Land, Valuation and Housing Tribunals, Consultation Paper No 170, Part II and appendices B – I.     [Back]

Note 8    Section 107.     [Back]

Note 9    Section 73.    [Back]

Note 10    The Solicitor’s jurisdiction was established by the Land Registration Act 1925.    [Back]

Note 11    Land Registration Act 2002, Sched 5 para 4.    [Back]

Note 12    The Commons Commissioners heard 2 cases in 2001/2002. Data from Council on Tribunals Annual Report for 2001/2002 (2002) HC 14.    [Back]

Note 13    See the Common Land Policy Statement, published by the Department for Environment, Food and Rural Affairs in July 2002. The proposed new jurisdictions for the Commons Commissioners are to make orders to de-register land, ordering unclaimed common land to be vested in a local authority, to inquire into claims of ownership of common land and to inquire into the ownership of town and village greens.     [Back]

Note 14    See para 4.38(2) below for a list of Valuation Tribunal appeals heard by the Lands Tribunal.    [Back]

Note 15    Note that the Law Commission’s forthcoming consultation paper on Termination of Tenancies for Tenant Default may put forward provisional proposals concerning forfeiture for non-payment of service charges. The consultation paper is due to be published in October 2003. For further information see the Law Commission’s website at www.lawcom.gov.uk.    [Back]

Note 16    Housing Act 1988. Note that by Chapter V of the Act, certain tenancies will still be regulated under the Rent Act 1977 in limited circumstances.    [Back]

Note 17    Housing Act 1988.    [Back]

Note 18    Note that a non-departmental public body, the Valuation Tribunal Service, is established by the Local Government Bill, clauses 104 – 105 and Sched 4 (as amended on report in the House of Lords on 17 July 2003).     [Back]

Note 19    Leggatt report, para 3.30.    [Back]

Note 20    Written Answer, Hansard (HL) 11 March 2003, col WA168. See also para 1.5 above.     [Back]

Note 21    Footnotes omitted. Our terms of reference are set out in full in para 1.2 above.    [Back]

Note 22    Land, Valuation and Housing Tribunals, Consultation Paper No 170, Part II.    [Back]

Note 23    Leggatt report, para 2.1.    [Back]

Note 24    Leggatt report, para 2.3.    [Back]

Note 25    Leggatt report, para 2.18.     [Back]

Note 26    Leggatt report, para 2.20.    [Back]

Note 27    Leggatt report, para 2.20.    [Back]

Note 28    Leggatt report, para 2.21.    [Back]

Note 29    Leggatt report, para 1.3.    [Back]

Note 30    Leggatt report, para 3.4.    [Back]

Note 31    Leggatt report, para 3.5.    [Back]

Note 32    Leggatt report, para 3.8.     [Back]

Note 33    Leggatt report, para 1.18.    [Back]

Note 34    Leggatt report, para 2.29.    [Back]

Note 35    Leggatt report, paras 2.1 and 2.23.    [Back]

Note 36    Leggatt report, para 4.21.    [Back]