Leasehold enfranchisement — Leasehold Reform Act 1967 — Determination of landlord’s section 9(4) costs — Leasehold valuation tribunal — Appeal — Whether valid appeal
The appellant landlord was the freehold owner of a
house. The tenant served notice of enfranchisement under the Leasehold Reform
Act 1967. Following an appeal, the Lands Tribunal determined the
enfranchisement price at £1,935 (LRA/70/97). The tenant applied to the
leasehold valuation tribunal for the determination of the landlord’s costs under
section 9(4) of the Act. At the commencement of the hearing, the landlord’s
solicitor applied for an adjournment. This was refused, the solicitor withdrew
and the tribunal determined the costs at £200. The landlord appealed on
procedural and substantive grounds.
Decision: The
Lands Tribunal had no jurisdiction to determine the appeal. The appeal against
the interlocutory decision of the leasehold valuation tribunal to refuse an
adjournment was invalid, because the Lands Tribunal has no appellate
jurisdiction on interlocutory decisions. The appeal against the final decision
of the leasehold valuation tribunal on the substantive grounds of costs was
invalid, because the landlord did not appear on the substantive issue before
the lower tribunal and had no right of appeal under para 2 of Schedule 22 to
the Housing Act 1980.
The following cases are
referred to in this report.
Electricity Supply Nominees Ltd v Sharma (VO) [1985] 2 EGLR 173; (1985) 276 EG 299; [1985]
25 RVR 188
Sarum Properties Ltd’s application [1999] 2 EGLR 131; [1999] 17 EG 136
Michael Daiches
(instructed by Grove Tompkins Bosworth, of Birmingham) appeared for the
appellant.
Giving his decision, MR PETER H CLARKE FRICS said: This is an appeal by the
landlord against the decision of a leasehold valuation tribunal determining the
costs payable by the tenant under section 9(4) of the Leasehold Reform Act 1967
(the 1967 Act) in the sum of £200 plus VAT (if appropriate).
Mr Michael Daiches called Mr Dennis Fell and
Mr
Facts
The appellant, Speedwell Estates Ltd (Speedwell),
was the freehold owner and landlord of 1 Wrekin Road, Perry Bar, Birmingham, a
house let for a term of 99 years from 24 June 1936 at a rent of £5.50 pa. On
6
that she desired to have the freehold of the house. The price was not agreed
and application was made to a leasehold valuation tribunal to fix the price.
Following a hearing on 27 October 1997, a leasehold valuation tribunal of West
Midlands Rent Assessment Panel assessed the price at £1,637 plus the
freeholders’ reasonable costs under section 9(4) of the 1967 Act and para 5 of
Schedule 22 to the Housing Act 1980 (the 1980 Act). The landlord appealed to
this tribunal, which increased the price to £1,935 (LRA/70/97).
On 12 September 1997 the tenant made application
to the leasehold valuation tribunal, under section 21(1) of the 1967 Act, for
the determination of the landlord’s costs under section 9(4) of the 1967 Act.
By a decision dated 15 June 1998 the tribunal determined the costs in the sum
of £200 plus VAT (if appropriate). On 25 June 1998 Speedwell appealed to this
tribunal on procedural and substantive grounds. The tenant did not respond to
this appeal.
Validity of appeal
At the start of the hearing I raised the question
of whether this appeal is valid. The provisions relating to appeals from
leasehold valuation tribunals are contained in the Housing Act 1980 Schedule 22
para 2. The material part of this paragraph is as follows:
any person who —
(a) appeared before a tribunal in
proceedings to which he was a party; and
(b) is dissatisfied with its decision,
may… appeal to the Lands Tribunal.
Thus, it is necessary for an appellant to this
tribunal to have been a party to the proceedings in the leasehold valuation
tribunal and to have ‘appeared’ before that tribunal. My doubt in this appeal
is whether Speedwell appeared before the leasehold valuation tribunal at its
hearing on 1 June 1998. The position at that hearing was as follows.
It is recorded on the front page of the tribunal’s
decision dated 15
solicitors, appeared for Speedwell. This is confirmed in the second paragraph
of the decision. The hearing took this form. At the start, Mr
the tribunal to strike out the tenant’s application for the determination of
costs or to adjourn it. The tribunal then ‘intimated that it was its intention
to proceed to hear arguments on costs at which Mr
no further instructions and sought the tribunal’s leave to retire from the
hearing’. Mr Devlin then left the hearing, the tribunal heard the tenant’s case
and determined the costs payable by the tenant under section 9(4) of the 1967
Act.
Following Speedwell’s appeal to this tribunal, the
usual inquiry was made to the leasehold valuation tribunal as to the parties
who appeared or were represented at the proceedings before that tribunal. The
reply recorded that Speedwell was represented by Mr Devlin, but then contained
the following note:
Mr Devlin stated that he was only instructed to
apply for an adjournment. When this was not granted he left the hearing. The
respondent/freeholder was therefore not present or represented at the
proceedings to consider the Application under Section 21(1)(ba).
On these facts, the question arises as to whether
Mr Devlin’s limited participation in the hearing on 1 June 1998 constituted an
appearance under para 2 of Schedule 22 to the 1980 Act for the purposes of an
appeal to this tribunal.
Mr Michael Daiches relied on the decision of the
Court of Appeal in Electricity Supply Nominees Ltd v Sharma (VO)
[1985] 25 RVR 188*. This is a rating case. At that time an appeal to this
tribunal from a decision of a local valuation court could be made by ‘any
person who… appears before a local valuation court on the hearing of an
appeal’: section 77 of the General Rate Act 1967. The question in Sharma
was whether the rating authority appeared before the local valuation court and
could appeal to the Lands Tribunal. The facts were as follows.
*Editor’s note: Also reported at [1985] 2 EGLR
173
At the local valuation court hearing a council
officer (Mrs Eldridge) presented herself to the clerk of the court and informed
him that she represented the council but did not intend to give evidence, and
merely wished to observe the proceedings. She did not sit at the table reserved
for the parties, but sat a little way behind and listened to the proceedings
until the lunch adjournment when she went away. The court record noted under
parties: ‘Rating Authority — Mrs Eldridge’. On an appeal by the council, the
Lands Tribunal held that they had appeared in the local valuation court, and
extended the time for appealing. Electricity Supply Nominees applied for
judicial review to quash this decision. The Court of Appeal refused this
application. Sir John Donaldson MR said at p189:
To my mind, the fact that [Mrs Eldridge’s]
presence is recorded as an appearance makes it quite impossible for us to say,
as we would have to say if we were going to quash the decision of the Lands
Tribunal, that no reasonable tribunal on that evidence could hold that Haringey
had appeared. Indeed, on that evidence, I would have held that it did appear.
In my judgment, the facts in Sharma differ
in two material respects from the facts in this appeal. First, in Sharma
the court record was endorsed to record Mrs Eldridge’s appearance on behalf of
the rating authority. In this appeal, although there is some slight
inconsistency in the record, the leasehold valuation tribunal has clearly
stated that Speedwell was not present or represented at the proceedings
relating to the substantive issue of costs. It appeared solely in connection
with the unsuccessful application to strike out the application or adjourn the
proceedings. Second, in Sharma Mrs Eldridge told the clerk that she
represented the rating authority but would take no part in the hearing. She
made her limited involvement in the proceedings clear from the outset. She was
present during at least part of the hearing. In this appeal, Mr Devlin clearly
represented Speedwell at the start of the hearing by making the application to
strike out or adjourn. However, he then said that he had no further
instructions, and left the hearing. He was not present during any part of the
hearing on the substantive issue.
My analysis of the position at the tribunal
hearing in this appeal is that there were, in effect, two consecutive hearings.
The first was to hear the landlord’s procedural application to strike out or
adjourn; Mr
tenant’s application for the assessment of costs, the substantive issue in this
appeal. Before this hearing started, Mr Devlin stated that he had no further
instructions, and left the hearing. He was not present during any part of the
substantive hearing. In my judgment, this shows that Speedwell did not appear
at the hearing of the substantive issue of costs, and therefore cannot appeal
to this tribunal on the decision on that issue. I do not see how a
representative who says that he has no instructions and then leaves the hearing
can be said to have appeared on behalf of a party at that hearing.
I hold that Speedwell did not appear before the
leasehold valuation tribunal at the substantive hearing regarding costs for the
purposes of para 2(a) of Schedule 22 to the 1980 Act, and therefore its appeal
dated 25 June 1998 to this tribunal is invalid. This tribunal has no
jurisdiction to deal with the decision of the leasehold valuation tribunal on
this matter.
In its grounds of appeal dated 25 June 1998,
Speedwell contended that the lower tribunal ‘proceeded with the hearing in
breach of the regulations in that the applicant thereof referred to documents
which had not previously been disclosed to the appellant.’ At the start of the
hearing before me, Mr Daiches said that the decision with which Speedwell is
dissatisfied is the decision of the leasehold valuation tribunal refusing to
adjourn the proceedings. Speedwell was represented at the proceedings leading
to this decision. I agree that Speedwell appeared before the tribunal for this
hearing, which formed part of the whole hearing. Mr Daiches abandoned this
particular point when I expressed doubt as to whether this tribunal had
jurisdiction over procedural matters in a leasehold valuation tribunal.
I also said that a consideration of the decision
to refuse to adjourn was unnecessary because an appeal to this tribunal took
the form of a rehearing, and if Mr Daiches were prepared to adduce evidence as
to costs, I could make a decision on amount without reference back to the lower
tribunal. This is, of course, subject to the validity of the appeal on the
substantive issue of costs, which was left open at the hearing before me, but
which I have now resolved. I then proceeded to hear evidence and submissions on
the amount of recoverable costs under section 9(4) of the 1967 Act.
I must, however, deal with the question of
jurisdiction on procedural matters. Does the Lands Tribunal have jurisdiction
over interim procedural decisions made by leasehold valuation tribunals?
This question recently came before the president,
George Bartlett
EG 136*. He referred to para 2 of Schedule 22 to the 1980 Act and section
31A(6) of the Landlord and Tenant Act 1985, which provides for leave to appeal
to this tribunal against decisions of a leasehold valuation tribunal under that
Act, and said at p137:
In the present proceedings the relevant
‘decision’ of the local valuation tribunal for the purposes of para 2 of
Schedule 22 to the 1980 Act and section 31A(6) of the 1985 Act is, in my
judgment, the decision that disposes of the application that has been made to
them. I do not think that any right of appeal arises on decisions of an
interlocutory nature, which do not dispose of the application. As I perceive
the scheme of the legislation, it is not the role of the Lands Tribunal to
oversee the procedures of leasehold valuation tribunals. Its role is to provide
an avenue of appeal once the leasehold valuation tribunal has discharged the
duty placed upon it by the statutes and has determined the application that has
been made.
*Editor’s note: Also reported at [1999] 2 EGLR
131
I agree. Applying this statement to the position
in this current appeal, it is clear that the lower tribunal’s decision to
refuse an adjournment was an interlocutory decision that did not dispose of the
tenant’s application for the determination of the costs. The decision on costs,
made by the tribunal following its interlocutory decision not to adjourn, is
the only decision that can be the subject of appeal to this tribunal, and I
have held that Speedwell cannot make such an appeal due to the lack of an appearance
in the tribunal below. Overall, therefore, the position is as follows.
Speedwell’s appeal against the interlocutory decision of the leasehold
valuation tribunal to refuse an adjournment is invalid, because this tribunal
has no appellate jurisdiction on interlocutory decisions. Speedwell’s appeal
against the final decision of the tribunal on the substantive issue of costs is
invalid, because, although this tribunal has an appellate jurisdiction on such
a final decision, Speedwell did not appear on this issue before the lower
tribunal and have no right of appeal under para 2 of Schedule 22 to the 1980
Act.
This tribunal has no jurisdiction to determine
Speedwell’s appeal. I should add that, if I had held that the appeal against
the substantive issue of costs was valid, I would have allowed the appeal to a
limited extent and determined the costs to be £385. I make no order regarding
the costs of this appeal.
