Avon Ground Rents Ltd v 51 Earls Court Square RTM Company Ltd
Decision date: 14 January 2016
Neutral citation: [2016] UKUT 22 (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 51 Earls Court Square RTM Company Ltd qualified as an RTM company under Chapter 1 of Part 2 of the 2002 Act, given its articles described the premises as "Flat 1-13, 51 Earls Court Square." The Upper Tribunal held that, read objectively in context (including the company name, objects and powers), the articles identified the whole self-contained building and not only the individual flats, and dismissed the appeal.
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 ratio is that where a company’s articles adopt model RTM wording, the description of the premises must be interpreted objectively against the factual and textual background; manifest literal wording that would frustrate the evident purpose may be corrected in construction. A company is an RTM company only in relation to premises properly identified by name and address in its articles, so those words must be capable of referring to premises to which Chapter 1 applies.
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 judgment also remarks that precision in drafting RTM articles is practically important to avoid doubt, but that loose terminology at formation will not be fatal where context shows the intended meaning. It further observes that articles’ powers to determine physical dimensions relate to measurement, not to changing the identity of the premises.