RTM notice for premises which contained a smaller self-contained part was valid

Where a property satisfies the statutory definition of premises, it is not necessary for the right to manage notice to specify the smallest part of the property capable of satisfying the statutory definition. In Assethold Ltd v Eveline Road RTM Co Ltd [2024] EWCA Civ 187; [2024] PLSCS 43, the Court of Appeal upheld Mr Justice Edwin Johnson’s decision that a notice served by an RTM company was valid, even though the property it specified could itself be split into a smaller part which would also satisfy the statutory definition of premises. Part 2, Chapter 1 of the Commonhold and Leasehold Reform Act 2002 creates a fault-free way for lessees of flats holding under long leases to manage the buildings containing those flats. The premises to which it applies are defined at section 72 of the 2002 Act. They must consist of a self-contained building or part of a building (with or without appurtenant property), contain two or more flats held by qualifying tenants, and the total number of flats held by such tenants must be not less than two-thirds of the total number of flats contained in the premises. The premises at 36 Eveline Road, Mitcham (No. 36), had originally been two terraced houses but had been converted into four flats, two in each of the original terraced houses. An RTM company had been formed with a view to acquiring the right to manage the four flats. No. 36 satisfied the definition of premises under section 72, as did each of the original terraced houses. The RTM company gave notice identifying No. 36 as the premises over which the right to manage was claimed. Assethold denied the right to manage and argued that, although No. 36 satisfied the section 72 definition of premises, as it was capable of division into smaller parts the RTM notice should have identified the smallest constituent part that would satisfy the statutory definition. In advancing this argument reliance was placed not on the wording of the 2002 statute but on comments made in Ninety Broomfield Road RTM Co Ltd v Triplerose Ltd [2015] EWCA Civ 282; [2015] EGLR 51 and FirstPort Property Services Ltd v Settlers Court RTM Co Ltd [2022] UKSC 1; [2022] PLSCS 5; [2022] 1 WLR 519, which appeals concerned RTM companies attempting to acquire the RTM more than one structurally separate block. Although the Court of Appeal accepted that, taken literally, the comments in Triplerose would support the argument advanced, it was not persuaded. The task at hand was to interpret the 2002 Act and not a judicial gloss on it. The blocks in Triplerose were structurally detached, such that the issue of self-contained premises themselves containing self-contained premises was simply not being considered. Further, there were indications in other parts of the 2002 Act that parliament considered that premises which themselves satisfied the definition in section 72 could contain smaller premises which themselves also satisfied that definition. There was no need for two RTM companies to be formed with each making separate claims in respect of each of the original terraced houses – the RTM company was entitled to acquire No. 36 as a whole. The appeal was dismissed. Elizabeth Haggerty is a barrister