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13/09/2021

Misc – erratum, Bedroom tax and DA, and Tribunal managers and reserve funds

An assortment of things…

First an erratum to yesterday’s post on the High Court judgment on applications to cancel a debt moratorium. The High Court had held that such an application must be by claim form. I was subsequently pointed at Practice Direction 70B, which says the application, whether or not in existing proceedings is by CPR 23 application form (and there is a new form N244D for that purpose). I’ve amended yesterday’s post. It appears that the same was pointed out to the Judge, as the bailli judgment now has an additional paragraph:

12A. Postscript: Since delivering this judgment, I have been referred to CPR PD 70B, paragraph 2, which I was not aware of at the time of preparing it. That paragraph provides that an application of the kind made here should be made by ordinary notice under CPR Part 23, rather than by claim form. I therefore add this short correctional paragraph, without otherwise altering the text of my judgment, in order that litigants and their advisers should not be misled.

Second, new regulations, The Domestic Abuse Support (Relevant Accommodation and Housing Benefit and Universal Credit Sanctuary Schemes) (Amendment) Regulations 2021, which provide that from 1 October 2021 the Bedroom Tax will not apply to local authority, housing association or charity accommodation if it is part of a sanctuary scheme, refuge accommodation, specialist safe accommodation, dispersed accommodation, second stage accommodation, or other accommodation designated by the local housing authority, private registered provider of social housing or registered charity as domestic abuse emergency accommodation.

Of course, the benefit cap does still apply…

Lastly, Whale & Ors v Taylor (LANDLORD AND TENANT – SERVICE CHARGES – reserve fund) (2021) UKUT 210 (LC)

Bruce Maunder Taylor was appointed Tribunal manager of a block of flats (in a rare example of the freeholder having applied for his appointment). He had subsequently made demands for payments from leaseholders for a reserve fund, totalling some £1.4 million. A number of leaseholders applied to the FTT to challenge these charges, and, after the FTT decided Maunder Taylor was able to levy these charges under the management order, (albeit that no valid demands had actually been made at that point), appealed to the Upper Tribunal.

The Upper Tribunal held that the lease did indeed contain a clause that permitted a reserve fund (being in very similar terms to that considered by the Court of Appeal in St Mary’s Mansions Ltd v Limegate Investment Co Ltd (2002) EWCA Civ 1491. The management order also contemplated and authorised a reserve fund being managed.

This, however, was not a separate power to that in the lease. While a management order conferring a separate power to create a reserve fund, over and above the lease was a possibility – Maunder Taylor v Blaquiere (2003) 1 WLR 379  – that was not what the management order in this case did.

But, and this is where matters take a somewhat bizarre turn, in County Court proceedings between the same parties culminating in trial in April 2019, both parties had accepted or conceded that there was no power under the lease to raise or maintain a reserve fund. That “the lease makes no provision for the collection of such a fund” formed part of the Circuit Judge’s judgment.

The Upper Tribunal, with an unstated weary sigh, therefore found that, although the County Court did not bind the Upper Tribunal

the parties to the County Court proceedings are bound by the Recorder’s finding that the leases make no provision for a reserve fund.  There was no appeal against that decision, and it is not open to the parties to ask this Tribunal to interpret the management order on the understanding that the leases bear a meaning different from that given them by the County Court.

In any event, the management order had ended and not been renewed and it did not appear that any valid demands for reserve payments had been made after the FTT decision, so the issue was probably academic as between these parties. The landlord, however, was not so bound by the County Court judgment and could raise a reserve fund.

 

 

 

Giles Peaker is a solicitor and partner in the Housing and Public Law team at Anthony Gold Solicitors in South London. You can find him on Linkedin and on Twitter. Known as NL round these parts.

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