United Kingdom Upper Tribunal (Lands Chamber)

UT Neutral citation number: [2012] UKUT 124 (LC)

UTLC Case Number: LRX/87/2011

TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007

LANDLORD AND TENANT – service charges – evidence  - procedural error – appeal allowed

IN THE MATTER OF AN APPEAL AGAINST A DECISION

OF A LEASEHOLD VALUATION TRIBUNAL

BETWEEN PACKAMIST LIMITED Appellant

and

MISS V GHAZNAVI Respondent

Re: Flat 1

Listed House

46 Peckham Grove

LondonSE15 6E

Determination on written representations

No cases referred to

DECISION

1.           This is an appeal against a decision of a leasehold valuation tribunal for the London Rent Assessment Panel in a service charge dispute.  It is made on the basis of permission granted by the LVT and it raises one short point.  The decision of the LVT concerned the service charges payable in respect of the respondent’s flat for the years 2009/10.  Under the terms of her lease she was liable to pay a percentage of what were called the “Block” costs and another percentage of what was called the “Estate” costs.  The application to the LVT had been made by the present respondent, and her contention before the LVT was said in the decision to have related to the reasonableness of the charges.

2.           Seeking to identify and limit the issues in dispute the LVT held a pre-trial review on 20 October 2010 and later a case-management hearing on 10 January 2011.  The substantive hearing was held on 14 March 2011.  Under the procedural directions that the LVT had given, the appellant had been required to produce a Scott schedule setting out the elements of the two service charges for the years in question and the respondent had been required to identify which of those she was contesting.  It appears that she failed to comply fully with this requirement.  The decision (at paragraph 9) says that she commented upon the Scott schedule for 2009 and raised certain specific items and that she had made a general reference to “exorbitant costs”.

3.           In its decision the LVT referred to the various elements of the Estate costs.  It stated its conclusion on these as follows:

“23. Doing the best we can with the evidence available we make the following deductions from the service charge account relating to flat 1 for 2009.  Under Estate Costs we disallow the whole of the amount relating to General repairs and Maintenance (£61.89) as on the evidence we have heard a large part of the costs relate to the parking areas the costs relating to which are not chargeable to flats without parking provision.  (Fourth Schedule 19 (a) and (b))  We accept that there may be items of expenditure unrelated to car parking but we do not have the evidence to distinguish them.”

At paragraph 25, in relation to the budget for 2010 the LVT said that it disallowed the Estate General Maintenance sum of £97.39 for the reasons set out in paragraph 23.

4.           The appellant was concerned that the LVT should have disallowed the Estate costs on the basis that the evidence that it had produced to the tribunal had been insufficient to show what costs had been incurred, since the respondent had not, as required by the LVT’s directions, identified those elements of the charge that she was disputing and accordingly it had not put before the LVT the relevant documentary material to show that the costs had indeed been incurred.  In its application to the LVT for permission to appeal it produced a bundle of invoices to show that the costs were justified.  The LVT granted permission to appeal, saying:

“It was made clear in paragraph 23 of our decision that it was only the charges relating to parking that were to be disallowed.  We further stated that on the evidence before us we were unable to distinguish between the charges relating to parking and those to general repairs and maintenance and for this reason the total sum was disallowed.  It is acknowledged that in the bundle of invoices now provided that some relate to items that would have been allowed should they have been put before us.  We further acknowledge that the challenge to these items had not been sufficiently specific for it to have been reasonable for the Respondent to have provided them at the time.”

5.           The appellant appends to its statement of case an itemised statement of the 2009 general maintenance expenditure and the invoices relating to these.  None of these relate to car parking.  The total amount, after apportionment to what is referred to as Block D, is stated to be £699.06, the same as the amount recorded under this heading by the LVT in paragraph 18 of its decision.  The respondent’s share of this (8.854%) would be £61.89, the sum disallowed by the LVT.

6.           I am satisfied that the appeal should be allowed and the case remitted to the LVT to complete its determination on the disputed items.  The invoices establish the expenditure on the basis of which the amount in dispute is claimed, and the appellant would have been able to produce these to the LVT if it had been aware of the case that it had to meet.  In her statement of case the respondent describes the costs as extortionate, especially where, she says, amenities provided do not apply to Listed House or to her, for example entry gates, refuse collection and maintenance of flower pots.  It will be for the LVT to decide whether the expenditure was reasonable and reasonably incurred.

7.           I would add that the need for this appeal arose because the LVT does not have power to set aside and re-make a decision in such circumstances as these.  When its functions are transferred to the First-tier Tribunal in 2013 it can be expected that such powers will be provided for in the rules made for the proposed Property Chamber.

Dated 23 March 2012

George Bartlett QC, President