Grey GR Ltd PartnershipApplicantMr ReederRespondent
Before
D Banfield FRICSRegional SurveyorJ B Leitch Ltd for the ApplicantDate 5 August 2020Hearing On the papersProperty: 54D Arundel Street, Portsmouth PO1 1NLType of application: Service Charge section 27A Landlord and Tenant Act 1985
DECISION
[43]The property of which this flat forms part has been the subject of a number of applications before the Tribunal. As the Applicant states, it has complicated layers of leasehold interests and a roof development carried out by another company.[44]In very simple terms Mr Reeder considers that his flat suffers water damage due to a hole in an external wall of the building, that it is the landlord’s obligation to keep the wall in repair and that due to this he does not see why he should pay service charges when he has suffered a loss/inconvenience[45]The conduct of this application has not been assisted by Mr Reeder’s failure to provide the independent expert evidence directed and to properly particularise his claim. I am mindful however that he is a litigant in person for which some allowance must be made. Following the guidance given by the Upper Tribunal decisions in Birmingham City Council v Keddie, Regent Management Limited v Jones and Admiralty Park Management v Ojo I will make my determination of the issues raised solely on the evidence submitted but in whatever manner that may be.[46]I also propose to follow the guidance given in the Upper Tribunal case of Daejan v Griffin [2014] UKUT 0206 (LC) although not necessarily in the same order as referred to at para 24 above. I propose first of all to see what evidence there is of any disrepair causing the water damage to Flat 54D, determine who has responsibility for making good any disrepair and then determine whether any losses have been suffered.[47]The many photographs appended to Mr Reeder’s Witness Statement do show damage apparently caused by water ingress to the interior of a flat. Photographs at 248 to 251 show lying water next to a poorly fixed felt upstand identified as being to the temporary flat roof, the original roof beneath also with lying water and finally a hole in what is said to be the external wall with a section of internal blockwork and part of an RSJ in view. At [264] is a photo of a blocked hopper contained in an email dated 18 August 2018 referring to Mr Reeder’s visit to clear the gutter above his flat. Further photos at [266] and [268] show a missing section of coping.[48]Mr Reeder relies on two reports which he refers to as “expert” that of Earl Kendrick Associates dated 21 June 2018 and Bradley Chambers of BWC Developments Southern Ltd dated 2 May 2020.[49]Whilst I accept the Applicant’s contention that neither report satisfies the requirements of an expert report that of Earl Kendrick is at least independent. The report was commissioned by Inspired Property Management on behalf of the Applicant following their recent purchase and is described as a Condition Report.[50]The report follows inspections on 12 January and 26 February 2018. The report was not flattering, and a large number of recommendations were made to bring the property into repair and compliant with regulations.[51]Paragraph 5.3 [300] states it has been reported that the roof is leaking to the projecting Flat 54D and that this is a second occurrence. The detailing for rainwater run-off from this area of the roof was seen from ground level to be poor and is resulting in staining and saturation of the exposed masonry.[52]Paragraph 5.4.1 states There are holes in the render and deterioration at the juncture with the Fire Escape stairs. Confirmation should be sought as to whether this is a snagging issue following damage by the Penthouse development.[53]And at 5.7.2 in referring to 54’s common parts; To the tope(sic) landing an area of plaster has been hacked off the wall to allow rainwater release from the cavity following recent ingress.[54]Mr Chambers witness statement dated 2 May 2020 contains no information other than that he is not acting under a conditional fee arrangement and refers to a quotation his company provided dated 12 February 2020. The quotation of £7,500 is said to include all materials and labour but is silent in respect of the VAT position. The works are described as “Flat roof incorrectly flashed, leaking on to the existing roof and rsj that goes through the hole that’s been cut in the external wall of the stairwell. Giving a direct water ingress route into the cavity of 54d.: New lead flashing required; Making good around steel beams required; Weather sealing of stairwell wall required; Internal works to flat 54d to rectify.[55]I am satisfied from the evidence presented that the interior of flat 54D has suffered water damage and the cause of that damage has been an ingress of water through the external fabric of the building.[56]Turning now to the repairing obligations of the parties.[57]Mr Reeder holds his flat on a lease dated 16 September 2016 between himself and Prinset Limited for a term of 125 years from 1 January 2015 [345] containing the following;• Superior Lease Means the Lease dated 23 December 2013 and made between Campoverde Limited(1) and Prinset Limited(2) [349]• 1.2 “the Lessee” and “the Landlord” shall in the case of the Landlord where the contract admits also means the Superior Landlord and in the case of both the Landlord and Tenant. Where context admits their respective successors in title”• 1.6 “the service charge” means a fair proportion of the total cost of the aggregate Annual Maintenance Provision for the Estate of each Maintenance Year which is payable by the Landlord to the Superior Landlord pursuant to the terms of the Superior Lease together with such additional sums as the Landlord shall determine acting responsibly as shall be necessary to repair and maintain the Common Areas falling within its demise under the Superior Lease.[58]The Superior Lease [380] is dated 23 December 2013, is between Campoverde Limited and Prinset Limited, comprises the third floor of Arundel House and contains the following; 1.1 “Building” The land at Arundel House …………….. “Common Parts” the Building other than the Property and the Lettable Units “Property” shall mean that part of the third floor of the Building known as Arundel House, 32-54 (evens) ……excluding (i) any of the main timbers or joists of the Building or any of the walls or partitions therein (whether internal or external) …….6.1 The “Services” are: cleaning, maintaining and repairing the exterior, structure, roof and foundations of the Building6.2 The Landlord shall not be liable or responsible for any damage suffered by the Lessee …………..through any defect in any fixture conduit lift staircase machinery or thing in or upon the Block or the Estate or any part thereof (including the Flat) or through the neglect fault or misconduct of any servant employed by the Landlord in connection with the Estate.6.3 Subject to the Tenant paying the Service Charge, the Landlord shall:6.3.1 To repair (and if necessary replace) the structural parts and maintain and decorate the exterior of the Building and the roof and foundations of the Building.6.3.2 To maintain and decorate where necessary the Common Parts.[14]The Annual Rent and all other money due under this lease are to be paid by the Tenant or any guarantor (as the case may be) without deduction, counterclaim or set-off.[59]In construing the leases, it is clear that clause 6.3.1 of the superior lease places the obligation to repair the structure on the landlord a due proportion of the cost of which shall be borne by the lessee by way of service charge in accordance with clause 1.6 of the occupational lease.[60]I have then considered whether clauses 6.2 and 14 of the superior lease have any relevance and consider that they do not. 6.2 is clearly unenforceable and clause 14 is of no effect being subject to the Unfair Terms in Consumer Contracts Regulations 1999[61]Mr Peters refers to Mr Reeder indicating that he had “fixed the cause of the ongoing leak” [336] and as such could not see a basis for the claim. First of all, I am satisfied that Mr Reeder’s comments were in relation to the clearing of a blockage to the drainage to the temporary flat roof to which Earl Kendrick’s report refers and not the hole in the external brickwork.[62]I would not expect a responsible landlord to rely on the report of one of its lessees when determining whether the disrepair referred to in a professional condition report it had commissioned, and which had been the subject of much correspondence, had been dealt with.[63]I am satisfied therefore that the Applicant has breached its repairing obligations with regard to Flat 54D.[64]Turning now to evidence of loss I am once again hindered by the paucity of the Respondent’s evidence. There appear to be two elements of the claim. A loss of potential rental value and the cost of repairs.[65]To support the first element there is an offer letter on a similar flat for a rental from 2020 at £450 per month. Even if it was accepted that the same rent applied to 54D in 2018 there will be costs such as management fees, voids and depreciation to deduct from the gross income to calculate the amount of lost profit that should be compensated.[66]In considering the claim for the cost of repairs it must be appreciated that this must relate to the cost of repairing the damage to Mr Reeder’s flat only. It cannot include the cost of repairs that are the responsibility of the landlord. The majority of the items in BWC’s quote of £7,500 are not in respect of repairs to Mr Reeder’s demise and, as it is not itemised there is no indication of the amount attributable to the flat.[67]Given that the maximum sum that I can determine as set off is the Respondent’s liability for 2018 service charges of £2,601.95 it would be disproportionate for me to attempt a sophisticated calculation in assessing the amount of any loss from the evidence provided.[68]In respect of the loss of potential rental income I determine the loss at £1,500 and in respect of the repairs to the interior of Flat 54D £500 giving a total set off of £2,000.00. Costs Section 20C[69]Mr Reeder’s submissions on this application are set out in paragraph 40 above. Contrary to his assertion however, the landlord will have incurred litigation costs in responding to his specific challenge and it is not accepted that the application to the Tribunal was to avoid its contractual obligations. I accept that, given the history of this building and the likelihood of challenges from lessees that it was reasonable for the landlord to seek to obtain the Tribunal’s determination in respect of service charges. I therefore refuse the application. Para 5A Schedule 11 The Applicant has not given an indication of any costs that it proposes to levy by way of an administration charge. I therefore reserve this part of my determination until I have received an itemised statement of costs and given the Respondent the opportunity to make submissions. Further Directions[70]Within 14 days of receipt of this determination the Applicant will send to the Tribunal and to the Respondent an itemised statement of any costs that it proposes to levy as an administration charge.[71]Within 14 days of receipt of such a statement Mr Reeder may send a response to the Tribunal with a copy to the Applicant. D Banfield FRICS 5 August 2020[1]A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application to the First-tier Tribunal at the Regional office, which has been dealing with the case. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.[2]If the person wishing to appeal does not comply with the 28-day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28-day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.[3]The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.