Automated Summary
Key Facts
The First-tier Tribunal Property Chamber (Residential Property) ruled that the respondent's application to strike out parts of the applicant's amended service charge dispute under section 27A of the Landlord and Tenant Act 1985 was granted in part. The Tribunal struck out claims regarding reserve fund demands (2008), legal expenditure (2008), and asbestos removal (2007-2009), finding these were barred by implied agreement or admission due to unqualified service charge payments over time. The Tribunal did not strike out claims for boiler replacement (2007-2010), insurance claim costs (2017), and roof damage works (2014), as these issues were not discoverable until recently and thus fell outside the agreement principle.
Issues
- The tribunal applied the Cain v Islington BC principles to assess historical service charge disputes, striking out older claims (2007-2008) while allowing recent issues (boiler replacement, insurance claims) to proceed.
- The tribunal determined that the respondent's strike-out application was permissible as the tribunal's directions did not constitute a consent order, thus not an abuse of process.
Holdings
The tribunal allowed the respondent's application to strike out parts of the applicant's amended grounds for the application in part. Specifically, the tribunal struck out reserve fund demands from 2008, legal expenditure from 2008, and asbestos removal from 2007 to 2009. The tribunal did not strike out boiler replacement from 2007-2010, insurance claim costs from 2017, and roof damage works from 2014.
Remedies
The tribunal partially granted the respondent's application to strike out parts of the applicant's amended grounds. It struck out the additional grounds regarding reserve fund demands from 2008, legal expenditure from 2008, and asbestos removal from 2007-2009, but did not strike out the grounds for boiler replacement from 2007-2010, insurance claim costs from 2017, and roof damage works from 2014. The tribunal also issued specific directions for the next steps in the case.
Legal Principles
The Tribunal determined that service charge payments can constitute agreement or admission under Section 27A(4) of the Landlord and Tenant Act 1985, based on the principles established in the case of Cain v Islington BC [2015] UKUT 542 (LC). The Tribunal held that agreement or admission may be express, implied, or inferred from the facts and circumstances, particularly where there has been a series of unqualified payments over a period of time without challenge. The Tribunal applied these principles to determine that certain historical service charges (from 2007-2008) should be struck out as they had been effectively agreed or admitted by the tenants through their payment history, while more recent charges (from 2017-2010) could be challenged as they were not sufficiently time-barred under the Cain principles.
Precedent Name
- Cain v Islington BC
- Marlborough Park Services Ltd v Leitner
- Chanel v Woolworth
- Weston v Dayman
Cited Statute
- Landlord and Tenant Act 1985
- Limitation Act 1980
Judge Name
Robert Abbey
Passage Text
- The Tribunal found the position adopted by the applicant to be persuasive in regard to this one additional ground. The Tribunal were mindful of their role which was to consider if this additional ground should be considered in due course by another Tribunal as to its reasonableness and payability. The task for the Tribunal was to consider if the Cain principles were applied to the facts of this dispute that the charge should be disallowed. The Tribunal decided that because the issues relating to the boiler only came to light comparatively recently, (the Integrated Design report is from February 2019), that as a consequence the additional ground should be allowed. In these circumstances the Tribunal determine that this particular additional ground should not be struck out and as such the respondent's application is not granted in this one respect.
- The applicant says that demands were made for a reserve fund in the period to 25 March 2008 of £175,000 but only 75% of the sum collected appears to have been credited in the ensuing accounts. Credit for the missing amount should have been given in subsequent years. The Tribunal was of the view that this was an item that would have been discoverable in the accounts for 2008. It also seems to the Tribunal that to try to object to this charge some thirteen years later is just the kind of payment caught by the principles set out in the Cain decision. There have been many service charge payments since then and there was no persuasive evidence of significant objections stretching through that period. In these circumstances the Tribunal determine that this particular additional ground should be struck out and as such the respondent's application is granted in this one respect.