KEVIN G CONWAY OLA AINA CAROL MARSHALL & ROGER GREEN SAUL GREENBERG & SAM CATHCART SAM BOND MANOJ BULSARA GEORGINA DWIGHT JULIANNE O’LEARY CHRISTOPHER SCOTT MALCOLM TORZ STEPHEN LEWIS KEVIN CONWAY SUDHA KHETERPAL SARADHA CABRAL v JAM FACTORY FREEHOLD LIMITED
Decision date: 10 December 2013
Neutral citation: [2013] UKUT 592 (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 a resident-owned freeholder could recover legal costs of resisting a s.24 appointment-of-manager application through the service charge and whether the First-tier Tribunal (LVT) properly exercised its s.20C discretion to prevent recovery. The Upper Tribunal held the lease (clause 14.1 and Ninth Schedule) was wide enough in principle to permit recovery of properly incurred costs of resisting the s.24 application, but that the LVT had erred in its blanket s.20C order; the UT substituted a limited order excluding 10% of those costs from the service charge for the leaseholders who were parties. Directions were given for possible further s.20C submissions relating to appeal costs.
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
A lease deeming provision expressed broadly ("notwithstanding anything herein contained" and "advisers of whatever nature") can, when read with the Ninth Schedule, permit recovery via the service charge of solicitors' and counsel's fees properly incurred in resisting a s.24 manager application, provided the costs are properly incurred in the management of the building and in the interest of good estate management; where the lease lacks express apportionment between Common Parts and Estate charges, a pragmatic apportionment reflecting the subject matter (single building → Common Parts percentage) is appropriate.
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's assessment of the degree of success in the underlying proceedings is an important factor in exercising s.20C discretion, though success does not automatically require exclusion of costs where the tribunal lacks costs powers; tribunals should also consider a resident-owned landlord's limited resources and practical consequences to avoid orders that unfairly discriminate between leaseholders.