Holding and Management (Solitaire) Limited v Leslie Stafford Miller  UKUT 402 (LC)
2nd April 2020
The FTT improperly purported to determine matters which it had no statutory authority to do so on the basis of the generality of the County Court’s order transferring the matter to it.
The Respondent tenant held a 125 year lease held his flat (“the Property”) pursuant to a 125 year lease (“the Lease”). The Lease demised the window glass, but not the window frames to him. The Lease contained the usual covenants imposed upon the Appellant freeholder as to the repair of the structure of the Property.
On 15 January 2019, the Appellant brought a claim against the Respondent in the County Court in relation to unpaid service charges and administration charges. Legal costs and statutory interest were also claimed.
The Respondent’s defence was that he should not have to pay for the replacement of the windows on the basis that he had replaced the windows of the Property himself and had paid the Appellant £200 for its consent for him to do so.
The Respondent also brought a counterclaim of £480 for damage to his health and associated costs.
On 29 March 2019, the matter was transferred to the FTT following what was, in effect an application by the Respondent under Section 27A of the 1985 Act.
Did the FTT have jurisdiction to dismiss the Appellant’s claim for legal costs, statutory interest and to dismiss the Respondent’s counterclaim?
The FTT determined that a reasonable cost of replacement windows and the front door of the Property was £280 including VAT and £224.36 for surveyors’ fees and associated costs of that project, totalling £504.36.
The claim for administration charges was dismissed on the basis that it was irrecoverable under the Lease and an order under Section 20C was made.
The Respondent’s counterclaim was dismissed. It did so at Paragraph 11 of its decision on the basis that:
“we have decided that the District Judge intended to pass the whole of the claim to the Tribunal, otherwise he would have made that clear (e.g. if limited to a s27A unreasonable charges claim). We therefore intend to deal with the whole of the claim, having already disposed of the counterclaim”.
The Appellant’s claim for legal costs and statutory interest on the sums claimed was also dismissed.
Decision on appeal
The Appellant challenged the FTT’s jurisdiction to dismiss the counterclaim.
This ground was upheld as Section 176A of the Commonhold and Leasehold Reform Act 2002 provides that where the court has to decide a question arising under any of a list of statutes, which includes the 1985 Act, “which the First-tier Tribunal … would have jurisdiction to determine“, it “may by order transfer to the First-tier Tribunal so much of the proceedings as relate to the determination of that question“.
The FTT therefore may only determine questions within proceedings that are transferred to it, which it has jurisdiction to determine. The FTT has no inherent jurisdiction. The mere generality of an order transferring a matter to it does not serve to furnish it with jurisdiction over matters, which as a matter of statute, it does not have.
The FTT therefore did not have jurisdiction to dismiss the counterclaim, nor the claim for legal costs, nor the claim for statutory interest.
It was also held that the FTT confused the administration charge (£60) with the claim for legal costs in the sum of £1,056. The Respondent made a bare assertion that the administration charges were exorbitant. The FTT’s dismissal of the claim for administration charges, in the absence of any elaboration as to why these were unreasonable, was said to be irrational and was set aside.
This case is a salutary reminder that the FTT may only decide matters which it has statutory jurisdiction to do so. This is still the case where orders of the County Court transferring such matters to the FTT lack particularity.
Expertise: Service Charges
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