When can premises be defined as “flats” within the meaning of section 101 of the Leasehold Reform, Housing and Urban Development Act 1993 (the 1993 Act)? This was the central question in Aldford House Freehold Ltd v Grosvenor (Mayfair) Estate and another [2018] EWHC 3430 (Ch), [2018] PLSCS 223.
The claimant was the nominee purchaser of the participating tenants in Aldford House, Park Street, London (“the building”). The claimant issued a Part 8 claim for a declaration that the participating tenants were entitled to exercise the right of collective enfranchisement in relation to the building. The first defendant owned the freehold of the building. The second defendant owned the headlease.
Pursuant to section 13(1) of the 1993 Act, notice must be given by a number of qualifying tenants of flats in the premises at the relevant date, which is not less than one-half of the total number of flats. Two notices were given pursuant to section 13 of the 1993 Act. The initial notice was given on the basis that there were 26 flats. A second notice was given on the basis that there were 30 flats. Both notices were signed by a solicitor purportedly acting on behalf of 17 participating tenants.
The defendants resisted the claim on a number of grounds, including: (a) on the relevant date there were four flats and four qualifying tenants on the sixth and seventh floors of the building who had not been named in the claimant’s initial notice served pursuant to section 13 of the 1993 Act; and (b) three of the tenants had not authorised their solicitor to sign the notices.
The sixth and seventh floors had originally comprised only two flats. Works carried out to the flats on those floors had resulted in two separate units on each floor. The units were uninhabitable as they had not been fitted out, but they had been demised under separate long leases to be used for only residential purposes.
Relying on Boss Holdings Ltd v Grosvenor West End Properties Ltd [2008] UKHL 5; [2008] 1 EGLR 51 and Day v Hosebay Ltd [2012] UKSC 41; [2012] 3 EGLR 33; [2012] 43 EG 116, the court emphasised that the statutory definition of “flat” in the 1993 Act was concerned with the purpose for which premises had been constructed or subsequently adapted. If it had been constructed or adapted for use as a dwelling then it was a “flat”. The fact that the flats were uninhabitable was irrelevant. Each unit had been constructed as a separate residential unit. Accordingly there were 30 and not 26 flats in the building.
The initial notice failed to name all of the qualifying tenants. In light of the decision in Natt v Osman [2014] EWCA Civ 1520; [2015] EGLR 11 it was therefore void. The second notice had been deemed withdrawn and was not relied on by the claimant in its application.
A board resolution authorising the solicitor to sign the notices on behalf of one of the tenants was invalid. The resolution was only ratified in 2018. The court found that Chapter 1 of Part 1 of the 1993 Act was inconsistent with an invalid notice becoming valid by ratification. An initial notice was either valid or invalid when it was given. The 1993 Act specified that the notice was only valid if given by a requisite number of qualifying tenants. Failure to comply due to a want of authority meant the notice was not given in accordance with the 1993 Act.
The claim was dismissed.
Elizabeth Dwomoh is a barrister at Lamb Chambers
