Assethold Limited v Alexandra Adam & Ors.
Decision date: 2 November 2022
Neutral citation: [2022] UKUT 282 (LC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned whether waking-watch service charges were "reasonably incurred" under s.19(1) of the Landlord and Tenant Act 1985. The FTT had found the Hydrock report overstated risk and that the waking watch was unnecessary; the Upper Tribunal held the FTT applied the correct two-stage legal test but misapplied it by assessing the decision with hindsight. The UT substituted a decision that one month’s interim waking watch for both contiguous blocks, reduced by 50% for poor service (total £14,000), was reasonably incurred.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The judgment identifies the test for "reasonably incurred" under s.19(1) as a two-stage enquiry: (1) whether the landlord’s decision-making process was rational (reasonable process), and (2) whether the outcome was objectively reasonable. Reasonableness must be assessed on the information available to the landlord at the time the cost was incurred, not with hindsight from subsequent litigation.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The tribunal observed that, while not necessarily mandatory, it would have been sensible for a landlord faced with divergent expert reports to obtain a second opinion. It also noted that adopting interim safety measures (such as a waking watch) in response to a reputable report declaring an "intolerable" risk can be a rational course, and that Hydrock’s recommendation to cover both contiguous blocks could be reasonable.