A declaratory determination under section 27A is not enforceable in county court

In Termhouse (Clarendon Court) Management Ltd v Al Balhaa [2021] EWCA Civ 1881; [2021] PLSCS 214, the Court of Appeal has clarified that a declaration as to the payability of service charges made in the First-tier Tribunal pursuant to section 27A of the Landlord and Tenant Act 1985 is not enforceable in the county court. The appellant was a long leaseholder of a flat in London NW2. The respondent management company had responsibility for, among other things, raising the service charges for the building in which the appellant’s flat was situated. In September 2017, the appellant applied to the FTT pursuant to section 27A of the 1985 Act for a determination as to the payability of service charges demanded by the respondent for the service charge periods 2015 to 2016 and 2016 to 2017. The appellant disputed the sum of £9,540.04 claimed for each period, which included legal fees of £23,604, for which the appellant was liable for a portion. The FTT determined that only legal costs in the total sum of £2,000 were allowable. The remaining items claimed for in each period were all payable. The appellant failed to make payment and the respondent applied to the county court for the enforcement of the FTT’s decision. In an order made in September 2018, a proper officer of the county court ordered that the respondent could “enforce the award” in the county court in the sum £9,316.04. The appellant applied to have the order set aside, but his appeal was dismissed by both a district judge and circuit judge in the county court. He appealed to the Court of Appeal. The Court of Appeal observed that section 176C of the Commonhold and Leasehold Reform Act 2002 permitted a decision of the FTT, other than one ordering the payment of a sum, to be enforced “in the same way as orders of [the county court]”. Further, section 27 of the Tribunals, Courts and Enforcement Act 2007 provided that where a sum was “payable in pursuance of a [tribunal] decision”, it was recoverable as if payable under a county court order. Accordingly, a decision of the FTT which was declaratory in nature could not be the subject of enforcement either under section 176C of the 2002 Act or section 27 of the 2007 Act. The question the Court of Appeal had to determine was whether a decision of the FTT on an application under section 27A was merely declaratory in nature. The Court of Appeal held that it was. It was argued by the appellant that sometimes the FTT exceeded its jurisdiction under section 27A of the 1985 Act and stated what service charges were due from a tenant rather than determining whether they were payable. The Court of Appeal refused to be drawn on this issue, but stated that even in such circumstances where that occurred, such a decision would only be declaratory in nature. If a landlord wanted to enforce a decision it would need to issue new proceedings in the county court in which the FTT’s decision would be binding on the parties. Elizabeth Dwomoh is a barrister at Lamb Chambers