197 Queen's Gate Limited v Helen Hsu Pugmire [2026] EWCC 29

[2026] EWCC 29

Case No J79YX554

IN THE COUNTY COURT AT WANDSWORTH

Date 21/05/2026

On Appeal from the decision of District Judge Parker

76-78 Upper Richmond Road

Putney

SW15 2SU

Before

HHJ MARQUAND

Between

197 QUEEN’S GATE LIMITEDClaimant/

MS HELEN HSU PUGMIREDefendant/

James Poole (instructed by Perilli & Ho Solicitors) for Appellant

Charles Davey (instructed by Brady Solicitors) for Respondent

Hearing Hearing dates: 8 May 2026

Approved Judgment

This judgment was handed down in open court.

.............................

HHJ MARQUAND

HHJ Marquand:

[1]The Respondent company is the landlord of the Appellant under a 999-year lease dated 6 November 2006 The Appellant is a director of the Respondent company, but nothing turns on this. . There was a dispute over unpaid service charges that resulted in the Respondent issuing proceedings, but by the time the matter came to trial on the small claims track the sums claimed had been paid by the Appellant. The outstanding issues were the payment of the Respondent’s legal costs in accordance with the terms of the lease and interest on the claim for service charges. The judge below held that the costs were recoverable and made an order for payment in the sum of £18,000 and an order for payment of interest on the unpaid service charges in the sum of £745.51. The Appellant was not present at the hearing and the issues in this appeal are whether the judge was wrong to make those awards of costs and interest. This was a “rolled up” hearing, in other words a hearing dealing with permission to appeal and the substantive appeal.

Background

[2]The property manager for the Respondent is “Susan Metcalfe Residential Property Management”. A statement of account for unpaid service charges dated 15 December 2020 was sent to the Appellant that showed the amount due from her was £1,893.82. A letter of claim was sent by the Respondent’s solicitors on 25 May 2021 stating that the total amount owed was £2,948.33. That sum was broken down as the service charge in the sum identified above, interest at £745.51 and associated legal costs making up the balance. This letter also stated that, if necessary, county court proceedings would be issued to obtain a final determination for the purposes of section 81 Housing Act 1996 and that:

“this determination will be relied upon if you fail to remedy your breach of covenant and forfeiture of your lease is necessary.”

The letter also stated that in the event of proceedings court fees, solicitors’ costs and interest from the time the sum became overdue would be claimed. There is a second reference to forfeiture stating:

“… steps may be taken to forfeit your lease…”

[3]On 12 June 2021, the Appellant paid the sum of £764.64. On 27 October 2022 proceedings were issued and the sum claimed on the face of the claim form was £5,417.21plus the court fee and legal representative’s costs of £100. Paragraph 9 of the Particulars of Claim stated that the service charge arrears were £2,747.67 and there was a reference to Annex 3 containing a statement of account, but that was not provided to the Appellant and no copy was in the bundle before me. Clause 3.7.4 of the lease was referred to as giving the Respondent a contractual entitlement to its legal costs in the proceedings. It is stated at paragraph 11 of the Particulars of Claim that interest was due at the statutory rate of 8% per annum, but the sum for interest was referred to as “£0.00” in two places and interest was said to be recurring at a daily rate of “£0.00”.

[4]In the Defence, the Appellant did not admit the contractual entitlement to costs under paragraph 3.7.4. The Respondent was put to strict proof as to the sums claimed and it was admitted that no interest had fallen due.

[5]On 27 January 2023 the Appellant paid a further sum of £1,570.46 and on 23 April 2024 the sum of £412.66. Those sums, together with the payment made on 12 June 2021, come to a total of £2,747.76 (that being 9p more than the sum referred to in paragraph 9 of the Particulars of Claim).

[6]A number of trial dates were adjourned but the matter reached a final hearing on 14 January 2025. The Appellant had written to the court in advance stating that she would not be able to attend the hearing and if it could not be rescheduled, she elected for a paper hearing. However, her request did not comply with CPR 27.9. In any event, the Appellant was not present at the hearing before District Judge Parker (the “Judge”) where the Respondent was represented by Mr Davey.

Proceedings before the Judge below

[7]On 14 January 2025, insofar as they are relevant, the Judge had before her the pleadings that I have referred to above and a witness statement dated 15 July 2024 from Mr Walter Lourenco, who is a credit controller for the property manager. This exhibited a number of documents including the lease and the statement of account dated 15 December 2020, which I have referred to above. Paragraph 8 of the statement states that the sum due is £1,893.82 and refers to the statement of account. The statement also identifies the three payments that have been made by the Appellant but states that they:

“… do not account for the full debt sought under the claim…”

However, that comment is not consistent with the sum claimed, as the total of the sums paid exceeds what the statement identifies as the sum due. At paragraphs 18 to 20 Mr Lourenco set out the history between the parties, in particular stating that it was not an isolated incident and that there had been proceedings before the First-Tier Tribunal and other proceedings concerning overdue service charges. It states that the Respondent had not behaved in a reasonable or fair manner towards the premises or the other leaseholders. He states:

“… given the numerous previous proceedings that have taken place against the [Appellant], the [Respondent] seeks to recover the legal fees under this claim, both out of fairness to the neighbouring leaseholders and as a deterrent to the [Appellant], in an effort to prevent the account falling into further arrears in the future.”

The statement does not mention forfeiture.

[8]The statement also refers to clause 3.7.4 of the lease, which is also pleaded as the basis for the entitlement costs. The terms of that clause are:

“To pay to the Landlord all reasonable and proper costs charges and expenses including Solicitors’ Counsel’ and Surveyors’ costs and fees at any time during the Term incurred by the Landlord in or in contemplation of any proceedings in respect of the Lease under Section 146 and 147 of the Law of Property Act 1925 or any re-enactment or modification thereof including in particular all such costs charges and expenses of and under the said Sections and of and incidental to the inspection of the Demised Premises and the drawing up of Schedules of Dilapidations such costs charges and expenses as aforesaid to be payable notwithstanding that forfeiture is avoided otherwise than by relief granted by the Court”

[9]A witness statement was also provided by the Respondent from Daniela Blamey. Ms Blamey is a director and shareholder of the claimant company. The witness statement sets out the way in which the properties are held. It covers the dealings between the parties and again states that the failure to pay arrears is not an isolated occurrence. The consequences for all of the property owners of the Appellant’s failure to pay service charges is set out and it is stated that it impacts on the “smooth running and upkeep” of the property. The summary is:

“For the reasons set out above, I respectfully request the court to enter judgment for the principal sum claimed, together with interest and legal costs.”

The statement does not mention forfeiture.

[10]The Judge also had a skeleton argument dated 15 July 2024 that was drafted by the Respondent’s solicitors. This document referred to the terms of the lease to entitle the Respondent to recover the unpaid service charges and the history between the parties. It set out clause 3.7.4 and the authority of Chaplair Ltd v Kumari

[2015] EWCA Civ 798

that makes it clear that in a claim on the small claims track, where costs are usually restricted, a party may recover costs under a contractual entitlement. The skeleton went on to state under a heading of:

“Forfeiture and section 81 Housing Act 1996” that before forfeiture there must be a determination of the amount of service charge payable. Reliance was placed upon Tower Hamlets London Borough Council v Khan [2022] EWCA Civ 831. It went on to state that the Respondent acted in contemplation of and/or incidental to a notice under section 146 the Law of Property Act 1925 and that the proceedings were a necessary precursor to the service of that notice. The Freeholders of 69 Marina, St Leonards on Sea v Oram and Ors [2011] EWCA Civ 1258 (69 Marina) was also relied upon. It concludes on this topic at paragraph 34 with the statement that: “It was held that, by virtue of Section 81, the proceedings in the leasehold valuation tribunal (which determined that the service charges were payable) and the County Court where necessary preconditions to the exercise of a right to forfeiture and therefore fell within the scope of the costs clause as noted above.”

[11]From the transcript of the hearing, it can be seen that Mr Davey confirmed that the principal sum due was £1,893.82 and that in addition there was a claim for interest. In this appeal, Mr Davey accepted that the claim for interest was poorly pleaded and that an incorrect figure was presented to the Judge. What the Judge was presented with was the figure of £745.51, as it appeared in the letter of claim. In the transcript, Mr Davey refers to 2 payments having been made of £1,570 and £412 but does not refer to the payment from June 2021. Mr Davey states before the Judge that interest has not been paid and that recovery of that sum is sought.

[12]It was agreed before me and as it was put to the Judge below, that there is no contractual entitlement to interest in this case. Any interest to be awarded on the unpaid service charges would fall to be dealt with at the discretion of the court.

[13]As to the contractual entitlement to costs, Mr Davey referred the Judge to “clauses in the lease”. He referred to 3 separate clauses, namely 3.7.4, 6.22 and a clause in the fifth schedule. Again, in the appeal Mr Davey confirmed that the references to 3 clauses was incorrect and that the only relevant clause was 3.7.4. The transcript does not identify the Judge’s reasoning on the entitlement to costs, but she states:

“I am satisfied you are entitled to costs on a contractual basis”

. The Judge goes on to assess the costs and reduce them from the sums claimed to the total figure of £18,000. The Judge makes the award for interest at £745.51.

The Grounds of Appeal

[14]The grounds of appeal were amended by consent and I summarise them as follows: i) Ground 1 is that there was an error of law on the construction of Clause 3.7.4 of the Lease (Ground 1 (a)) and 69 Marina was referred to, but not No. 1 West India Quay (Residential) Ltd v East Tower Apartments Ltd

[2021] EWCA Civ 1119

(West India Quay). Even if that is wrong, the Respondent was not entitled on the facts to recover its costs of £18,000 from the Appellant (Ground 1(c)). Mr Poole in his skeleton argument, advanced an argument (Ground 1(b)) that the Judge was led into error by a failure to draw her attention to Barrett v Robinson

[2014] UKUT 0322 (Barrett)

which concerns the construction of a similar clause. Mr Davey objected to this argument being advanced as he said it was not raised in the amended grounds. Mr Davey had dealt with Ground 1(b) in his skeleton argument and fairly pointed out that he had only noted the point he now raised during Mr Poole’s oral submissions. In the grounds of appeal there are 12 sub-paragraphs to ground 1 which sets out in detail the grounds, which Mr Poole summarised in his skeleton as grounds 1(a), (b) and (c). It is correct there is no specific reference to Barrett. However, I am satisfied that the argument is sufficiently identified within the main text concerning ground 1, which concerns the construction of clause 3.7.4. In addition, it would be artificial to construe the clause without being able to consider the entirety of it. There is no unfairness to the Respondent as Mr Davey confirmed to me that there was no prejudice, as he had been able to deal with it. ii) Ground 2 is that the only pleaded clause for a contractual entitlement to costs was clause 3.7.4 and not the other 2 clauses referred to by Mr Davey before the Judge. The Particulars of Claim had not been amended to refer to the additional clauses and in any event neither of them raised an entitlement to costs. iii) Ground 3 was that the Judge was in error in concluding that the Respondent was entitled to interest. The pleadings did not include a sum for interest and the defence had admitted that no interest was due. There was no explanation as to how the sum of £745.51 had been calculated by reference to the principal sum claimed. iv) Ground 4 was that the statements of costs had not been served in accordance with a previous court order or the CPR. The claimant was out of the jurisdiction. The Appellant was denied an opportunity to dispute the alleged reasonableness and/or proportionality of the costs.

The Law

[15]CPR 52 governs appeals and the relevant extracts (omitting irrelevant wording) are as follows: i) CPR 52.6 – “(1) …permission to appeal may be given only where—(a) the court considers that the appeal would have a real prospect of success; or

(b) there is some other compelling reason for the appeal to be heard.” ii) CPR 52.21 – “(3) The appeal court will allow an appeal where the decision of the lower court was— (a) wrong; or (b) unjust because of a serious procedural or other irregularity in the proceedings in the lower court.” iii) CPR 52.20 states that the appeal court has all the powers of the lower court.

[16]Section 146 of the Law of Property Act 1925 (LPA) sets out the procedure required in order for a landlord to forfeit a lease. This includes service of a notice containing certain requirements (a “section 146 notice”). Clause 3.7.4 as relevant to the facts of this case, refers to costs incurred by the landlord in contemplation of any proceedings in respect of the lease under section 146 LPA. When in this Judgment I refer to “contemplating a section 146 notice” it is a shorthand way of referring to the proceedings referred to in the clause i.e. those requirements leading to forfeiture of the lease. Section 81 of the Housing Act 1996 restricts the use of the procedure in section 146 LPA. The restriction is that in relation to premises let as a dwelling for failure to pay a service charge forfeiture will not be ordered unless “it is finally determined by (or on appeal from) … a court… the amount of the service charge… payable by [the lessee] …”

[17]Similar wording to clause 3.7.4 has been considered in a number of authorities, which are relied upon by the parties.In 69 Marina a landlord sought to recover from 2 lessees the costs of repairs and the matter was determined by the Leasehold Valuation Tribunal. Neither lessee paid the sums found to be due and proceedings were issued in the county court. At first instance the district judge found that the clause in the lease entitled the landlord to its legal costs. The lessees appealed and on the same day the landlord served a section 146 notice. On appeal before the circuit judge the decision of the district judge was upheld. In the Court of Appeal, the Chancellor of the High Court gave the lead judgment. The judgment states at paragraph 20:

“In those circumstances the District Judge was right to have concentrated on the terms of clause 3(12). Liability under that covenant extends to: (a) “expenses…incurred by the landlord…in or in contemplation of proceedings under s.146…”; and (b) “…all solicitors costs…incurred by the landlord of and incidental to the service of all notices and schedules relating to wants of repair…”

. Given that the determination of the Tribunal and a s.146 notice are cumulative conditions precedent to enforcement of the Lessees’ liability for the Freeholders’ costs of repair as a service charge it is, in my view, clear that the Freeholders’ costs before the Tribunal fall within the terms of clause 3(12). If and insofar as any of them may not have been strictly costs of the proceedings they appear to have been incidental to the preparation of the requisite notices and schedules.” (a) “expenses…incurred by the landlord…in or in contemplation of proceedings under s.146…”; and (b) “…all solicitors costs…incurred by the landlord of and incidental to the service of all notices and schedules relating to wants of repair…”.

[18]In West India Quay Lord Justice Henderson gave the lead judgment. There was a long running dispute concerning the utilities supplied to the building and the appropriate division of costs for that supply. Insofar as it is material to this case, the issue was whether the landlord’s litigation costs before the First-Tier Tribunal (FTT) were recoverable under the lease. In this case it was the tenant who had brought the proceedings. The relevant provision in the lease was materially the same as the one in this case in clause 3.7.4. The FTT concluded as a matter of fact that the landlord had not “ever evinced an intention to forfeit or to take proceedings of forfeiture.”. The Upper Tribunal and the Court of Appeal proceeded on the basis that this was a finding of fact and Lord Justice Henderson concluded that the FTT was entitled to conclude that no such proceedings were in contemplation by the landlord when the relevant costs were incurred. Counsel for the appellant landlord argued that section 81 of the Housing Act 1996 made it a condition precedent to service of a section 146 notice that a determination must first be obtained from the FTT. That was sufficient to bring the costs within the requirement of the relevant clause. He relied upon 69 Marina. He also argued that Barrett had been wrongly decided. Lord Justice Henderson rejected both submissions quoting from Barrett that a landlord may decide to commence proceedings in the county court for recovery of service charges without a claim for forfeiture being included. The factual circumstances of 69 Marina were also distinguished and the conclusion of the Chancellor at paragraph 57 of the judgment states:

“For these reasons, I am satisfied that 69 Marina is clearly distinguishable on its facts, and it does not establish, either expressly or by necessary implication, that legal costs are incurred by a landlord in contemplation of proceedings under section 146, in a clause similar to clause 3.10.1 in the present case, merely because they are incurred in relation to proceedings before the FTT which could in theory be the necessary prelude to service of a notice under section 146. The words “in contemplation of any proceedings” in clause 3.10.1 do in my view require an investigation of the landlord’s state of mind at the time when the costs were incurred, although any intention formed at that stage to serve a section 146 notice will of necessity be contingent upon the conditions of section 81 of the 1996 Act being satisfied.”

[19]Barrett also concerned the recovery of legal fees under a clause in the lease where the material wording is the same as in clause 3.7.4. The date of the decision is after that in 69 Marina but before that in West India Quay. The dispute was over the proportion of insurance rent and there were two decisions of the Land Valuation Tribunal. The first set of proceedings were brought by the lessee. The second decision was that the lessee was to pay £6,250 in costs to the landlord and this was the decision under appeal. No section 146 notice was served. The landlord relied upon 69 Marina and the Land Valuation Tribunal relied upon it to reach the conclusion that the lessee was liable for the costs. One of the landlord’s arguments on the appeal was that the contractual entitlement arose because the proceedings before the Land Valuation Tribunal were a necessary preliminary step before a section 146 notice could be served.

[20]The Deputy President of the Upper Tribunal rejected the landlord’s argument that the clause was wide enough to cover the costs of any proceedings. The judgment is clear that it is restricted to preparation of a section 146 notice or in contemplation of such a notice. It states:

“48. The real purpose of a clause in the form of clause 4(14) can be seen from its concluding words: “notwithstanding forfeiture is avoided otherwise than by relief granted by the Court.”

Where a forfeiture is avoided by relief granted by the court, the terms of relief reflect the principle that the landlord should be put in the position it would have been in but for the forfeiture (i.e. if the tenant had not committed the breach of covenant on which the forfeiture was based)(see Woodfall: Landlord and Tenant, para 17.169; Egerton v Jones

[1939] 2 KB 702

). That principle will normally require that the tenant reimburse any costs incurred by the landlord in serving the required section 146 notice and in bringing the proceedings. However, the purpose of a notice under section 146(1) is to allow a tenant who is in breach of covenant the opportunity to remedy the breach. Where a breach has been remedied within a reasonable time, the notice will have been complied with and the landlord will have no continuing cause of action, nor any reason to commence proceedings to forfeit the lease. The same landlord may nonetheless have incurred significant costs in the preparation of the notice itself. The object of a clause such as clause 4(14) is to give the landlord the contractual right to recoup the costs incurred in taking those preparatory steps, even where no proceedings eventuate in which the payment of the landlord’s costs could be made a condition of relief against forfeiture. “49. Clause 4(14) must therefore be understood as applying only to costs incurred in proceedings for the forfeiture of a lease, or in steps taken in contemplation of such proceedings. Moreover, even where a landlord takes steps with the intention of forfeiting a lease, a clause such as clause 4(14) will only be engaged (so as to give the landlord the right to recover its costs) if a forfeiture has truly been avoided. If the tenant was not in breach, or if the right to forfeit had previously been waived by the landlord, it would not be possible to say that forfeiture had been avoided – there would never have been an opportunity to forfeit, or that opportunity would have been lost before the relevant costs were incurred. In those circumstances I do not consider that a clause such as clause 4(14) would oblige a tenant to pay the costs incurred by their landlord in taking steps preparatory to the service of a section 146 notice.”

[21]The Deputy President went on to conclude that the landlord must have the section 146 notice proceedings in contemplation and if they do not as a matter of fact have such a contemplation that they will not be able to recover the costs based on the contractual clause. The decision in Barrett was referred to in West India Quay, in particular paragraph 51 and the submission that the case had been wrongly decided was rejected by Lord Justice Henderson.

Discussion and Decisions

[22]The Respondent has conceded on ground 2 that there was only one clause, namely 3.7.4, upon which the Judge would have been entitled to award costs. It is not possible to tell from the transcript of the hearing whether the Judge appreciated that point. In light of that concession what the appeal turns on is: was the Judge wrong in her apparent conclusion that clause 3.7.4 did entitle the Respondent to recover its costs in the way that she ordered and ground 1(a) and (b) are the key. I infer that the Judge had considered the skeleton argument of the Respondent’s solicitors. On that basis she would have been misled by paragraph 34, which did not refer to West India Quay. I agree with the Appellant’s submissions on this point. The parties agree that it is for me to determine the construction of clause 3.7.4.

[23]The Appellant’s argument is that 69 Marina and West India Quay establish that where one set of proceedings are a precursor to another, a landlord can only form an intention to forfeit a lease after the pre-cursor set of proceedings have been resolved in its favour. It is said that a party cannot contemplate a section 146 notice where it is barred by statute from bringing those proceedings. In addition, the Appellant relies upon Barrett at paragraphs 48 and 49 as it cannot be said that forfeiture has truly been avoided. The Respondent never had the right to forfeit the Appellant’s lease or to bring such proceedings because section 81 Housing Act 1996 acted as a bar. As there was no right to forfeit, forfeiture had not been avoided. It was necessary to look at the full wording of clause 3.7.4 in particular the phrase: “… notwithstanding that forfeiture is avoided otherwise than by relief granted by the court” to construe the true meaning of the clause.

[24]In 69 Marina the wording of the clause relied upon to recover costs was not identical to the wording in clause 3.7.4 or the wording in West India Quay. This is because it included the phrase “incidental to” in addition to the words “in contemplation of”. In 69 Marina a section 146 notice had been served during the proceedings and the judgment in 69 Marina specifically refers to: “if and insofar as any of them may not have been strictly costs the proceedings they appear to have been incidental to the preparation of the requisite notices and schedules.” (see paragraph 17 above and the quote from paragraph 20 of the judgment).

[25]Furthermore, paragraph 57 of West India Quay and of paragraphs 48 and 49 of Barrett do not mean what the Appellant contends. At paragraph 57 of West India Quay Lord Justice Henderson clearly states that: “in contemplation of any proceedings” requires an investigation of the landlord’s state of mind at the time when the costs were incurred. The reference to: “any intention formed at that stage to serve a section 146 notice will of necessity be contingent upon the conditions of section 81 of the [Housing Act] being satisfied” does not detract from the conclusion that it is the landlord’s state of mind that is key. Of course, as this phrase identifies, if the landlord has formed an intention to issue a section 146 notice it will be contingent in the way described. It does not mean a landlord cannot be found to contemplate a section 146 notice until section 81 of the Housing Act 1996 has been complied with. The Appellant’s reliance upon Barrett is also misplaced as the Deputy President was referring at paragraph 49 to the circumstances where the landlord has taken steps with the intention of forfeiting a lease. The part of 3.7.4 starting “notwithstanding” does not affect the construction of the whole clause. Furthermore, in both cases the argument that the Appellant advances had been advanced as I have identified above and was rejected. In a clause with the wording of 3.7.4 costs may only be awarded where, following a factual assessment, the Judge reaches a conclusion that the landlord was contemplating a section 146 notice. I therefore dismiss grounds 1(a) and 1(b) on the basis that there is no real prospect of success.

[26]The Appellant argues on ground 1(c) that West India Quay requires an investigation of the landlord’s state of mind at the time when the costs were incurred (as I have identified above and as the Respondent submits). The Judge cannot have considered this exercise if she followed the Respondent’s skeleton argument. I can undertake this assessment. The Appellant says that the evidence before the Judge was inadequate to establish that the Respondent was contemplating a section 146 notice. The Respondent submits I am entitled to reach such a conclusion because of the references to forfeiture in the letter of claim and from inferences to be drawn from the witness statement of Mr Lourenco, in particular the record of the Appellant’s conduct. The Respondent also sought to produce fresh evidence in the form of a witness statement dated 4 May 2026 from Ms Jenna Mullock, associate director of the property manager. At the beginning of the hearing, I refused permission to rely on that fresh evidence for the reasons that I gave at the time. However, to summarise them I concluded that the evidence could have been obtained with reasonable diligence and although credible, it would have been unlikely to affect the outcome.

[27]The evidence that was available to the Judge explicitly referring to forfeiture are the references within the letter of claim. In my judgement those references seek to persuade the Appellant to pay the sums due (a threat in other words). They are not sufficient to indicate or substantiate that the Respondent was contemplating a section 146 notice. The witness statement of Mr Lourenco (which is not from the Respondent, but the property manager) despite recording the difficulties between the Appellant and Respondent, does not allow an inference to be drawn that the Respondent was contemplating a section 146 notice. In fact, to the contrary, the conclusion that I have quoted at the end of paragraph 7 above supports that the purpose of the proceedings was to recover the service charge. This is also the focus of the statement of Ms Blamey referring to the impact of non-payment on the property and other lessees. There is no evidence upon which to conclude that the Respondent was probably contemplating a section 146 notice. For completeness, even if I take into account the evidence of Ms Mullock it would not assist the Respondent. This evidence was produced very shortly before the hearing and included statements that enforcement action would be pursued including forfeiture, if the breaches were not remedied. Forfeiture was not theoretical and would be actively pursued if payment was not made. However, Ms Mullock did not provide evidence about what the Respondent contemplated or at what point in the process any such contemplation was formed. There is no documentary or other material exhibited to corroborate what are otherwise self-serving statements that seek to remedy the obvious deficiencies in the evidence before the Judge. It carries virtually no weight and would not alter the conclusion that I have reached. For these reasons, I grant permission and allow the appeal on ground 1(c).

[28]Ground 3 concerns the award of interest. The Appellant argues that it was unclear how the sum of £745.51 came to be calculated, that no claim for an amount of interest was pleaded and the pleadings were not amended and in any event the Appellant had already paid more than the sum claimed, which would have covered any claim for interest. Mr Davey accepted that the figures provided to the Judge were incorrect. Again, I can deal with the question of interest.

[29]I found the Respondent’s arguments on this point difficult to reconcile with the figures in the evidence before the Judge. Mr Davey confirmed that the arrears claimed were £1,893.82. He said there were additional service charges due, but there was no evidence of those additional service charges. In his skeleton Mr Davey carried out some calculations to come to a figure of interest of £372.63, but that still ignored the total sum that the Appellant had paid of £2,747.76. First, on the pleadings the Respondent had specifically not claimed a sum for interest and the Appellant had admitted that fact. In those circumstances, it is not fair to the Appellant to introduce the claim for interest. It would have been necessary to amend the pleadings as the amount of interest had not been put in issue. Secondly, given the difficulties Mr Davey had in coming to a figure for interest I am not satisfied that the Respondent proved the claim. In particular, I was unable to follow the basis upon which interest was claimed before me. The Appellant had paid more than the principal sum due and more than the principal sum plus the sums of interest Mr Davey sought to persuade me was now the correct figure. I therefore grant permission and allow the appeal on ground 3.

[30]In light of the conclusions that I have reached on the other grounds there is no need for me to deal with ground 4. Summary

[31]The Respondent is the Appellant’s landlord on a long lease of a dwelling. The Appellant was in arrears of service charges. The Respondent commenced proceedings to recover those overdue service charges, which were paid by the Appellant before the hearing at the court below. In the absence of the Appellant, the Judge below ordered that the Appellant paid the Respondent’s legal costs under a clause in the lease. The Judge also made an award for interest on the overdue service charges. The Appellant appealed both decisions and I have found that the relevant clause in the lease did not entitle the Respondent to recover its costs because, as a matter of fact, the Respondent was not contemplating a section 146 notice a requirement of the clause. I also allowed the appeal in relation to interest, disallowing that sum ordered as the Respondent had not pleaded a figure for interest or satisfied me on the sum of interest payable. Accordingly, I have allowed the appeal.