ELDERSAN LIMITED v RADAN COVIC (PERSONAL REPRESENTATIVE OF MRS DUSICA MACRAE-BROWN) (DECEASED) [2020] UKUT 3 (LC)

UPPER TRIBUNAL
LANDS CHAMBER
[2020] UKUT 3 (LC)Case No LRX/2/2019
Between
ELDERSAN LIMITEDApplicantRADAN COVIC (PERSONAL REPRESENTATIVE OF MRS DUSICA MACRAE-BROWN) (DECEASED)Respondent
Before
Martin Rodger QCPaul Francis FRICSNeil Mendoza (instructed by Brachers LLP, solicitors) for AppellantStephanie Wookey (instructed by Smithfield Partners, solicitors) for RespondentDate 9 January 2020Property: Ground Floor Flat,, 47 Marmion Road,, London, SW11 5PB, Martin Rodger QC, Deputy Chamber President and Paul Francis FRICSCatchwords: LANDLORD AND TENANT – BREACH OF COVENANT – alterations carried out without landlord’s consent – whether breach of covenant to keep in tenantable condition so as to provide support – FTT unable to resolve difference of opinion between experts – sufficiency of reasons – appeal allowed - s.168(4), Commonhold and Leasehold Reform Act 2002
[1]This is an appeal against a decision of the First-tier Tribunal (Property Chamber) (“FTT”) made on 30 August 2018 concerning alleged breaches of covenant arising out of works undertaken to the Ground Floor Flat at 47 Marmion Road, London, SW11 by the respondent, Mr Radan Covic. At the time the works were carried out the respondent’s wife, Mrs Dusica Macrae-Brown, was the owner of the long leasehold interest in the flat. The proceedings arise out of an application made by Mr Covic’s landlord, Eldersan Ltd, on 12 December 2017 under section 168(4), Commonhold and Leasehold Reform Act 2002 for a determination that breaches of covenant had occurred.[2]The FTT was satisfied that the works undertaken by Mr Covic included works for which no consent had been obtained. It failed to reach a conclusion on whether those works had caused damage to the flat above Mr Covic’s, despite having heard expert evidence from two structural engineers. Permission to appeal was granted by this Tribunal on the grounds that it was arguable that the FTT had failed to make a proper assessment of the evidence available to it or alternatively, that it had failed to provide adequate reasons for its decision.[3]At the hearing of the appeal the parties were represented by counsel – Mr Neil Mendoza for the appellant and Ms Stephanie Wookey for the respondent. We are grateful to them both for their assistance.[4]In giving permission to appeal the Tribunal directed that if the appeal was allowed, rather than sending the matter back to the FTT for further consideration, the Tribunal would re-hear the original application (to the extent that it was the subject of the appeal). In the event we indicated to the parties after hearing argument that we were satisfied the appeal must be allowed and we proceeded to hear evidence from the expert witnesses who had appeared before the FTT, Mr J. Sinclair- Johnson, and Mr Andrew Greig, both of whom are structural engineers. We also undertook an inspection of the property on 28 November 2019. The undisputed facts[5]47 Marmion Road is a two-storey bay-fronted end of terrace Victorian house traditionally constructed of brick under slated roofs with a basement below part of the ground floor. At some time before 1989 the property was divided into two flats. Both flats were, and still are, accessed from the front door through a communal entrance lobby that leads to the ground floor flat, and to the stairs to the first floor.[6]Before the works with which this appeal is concerned were undertaken, the ground floor flat comprised a living room with a front facing bay window and an open fireplace and chimney breast on the flank wall. Double doors in the spine wall at the rear of this room gave into the kitchen/dining room which also had an open fireplace and chimney breast. Doors from this room led into the rear garden. An internal hall led to the rear outrigger containing a bedroom and bathroom. The basement was reached by stairs down from the inner hall and was on the party wall side of the property, principally below the communal hall.[7]The flat on the first floor was laid out in a similar way to the ground floor. In particular, the wall separating the entrance lobby from the living room on the ground floor was continued up at 4 first floor level, as was the spine wall separating the living room from the kitchen/dining room on the ground floor.[8]Outside the building, adjacent to the flank wall, there is a small tree the roots of which have caused disturbance to the pavement.[9]The appellant owns the freehold of 47 Marmion Road. On 12 May 1989 it granted a lease of the ground floor flat to Mrs MacRae-Brown, and her former husband for a term of 99 years. A Deed of Variation extending the term to 170 years was entered into on 21 November 2008. The lease subsequently became vested in the respondent, Mr Covic, who inherited it following the death on 13 December 2017 of Mrs Macrae-Brown, whom he had married shortly beforehand.[10]The lease includes covenants on the part of the lessees in conventional terms for this type of residential property. By clause 2(3) they covenanted not to cut any of the walls, ceilings, floors or partitions of the demised premises. By clause 2(4) they covenanted not to make any structural alterations without the previous consent in writing of the landlord. Finally, by clause 3(1) they covenanted to keep the demised premises “in good substantial and tenantable repair and condition and in particular so as to support shelter and protect the parts of the property other than the demised premises …”[11]In 2008 Mrs MacRae-Brown obtained planning permission to erect a single-storey extension at the rear of the premises. A further planning permission was obtained in 2009. She then sought the appellant’s consent to undertake the permitted work, which was given in principle subject to the execution of a formal licence for alterations.[12]On 7 July 2009, acting on the instructions of the respondent, VM Architects prepared a schedule of condition which recorded the condition of the first floor flat before the commencement of any works on the ground floor. So far as is relevant to this appeal the schedule of condition showed that there was extensive minor cracking to the walls and ceilings in the first floor flat, including in the bedroom and living-room. No adverse comment was made concerning the condition of the floors in those rooms, although we take the statement “good condition” to be a reference to the state of the carpets.[13]The ground floor flat was also reported to be in relatively poor condition at this time. An escape of water occurred in August 2008, resulting in an insurance claim which was handled by the appellant’s agents. The Loss adjuster wrote to the agents on 19 March 2009 and referred to cracking in the living room, kitchen and bathroom. This was described as historic and associated with normal wear and tear. Costs associated with reinstating these defects would not be covered by the insurance claim.[14]On 16 April 2010 the appellant granted Mrs MacRae-Brown a licence to carry out alterations to the ground floor flat. The permitted alterations included the removal of the walls of the bedroom in the rear addition to facilitate the extension of the flat into the garden. The permitted work also included the removal of the chimney breast in the kitchen/dining room, the removal of a short section of the spine wall between the living room and the kitchen/dining room to enable a door to be inserted to replace the original double door opening in the centre of the spine wall which was to be infilled 5 with a stud partition. No works were permitted to the section of the spine wall between the flank wall and the double doors, nor was the removal of the chimney breast in the living room authorised.[15]The work carried out exceeded what had been permitted by the licence. In particular, the whole of the spine wall at ground floor level was removed and replaced by a stud partition in the same location, rather than only part of it. The chimney breast in the living room was also removed and a pair of steel joists was inserted to support the weight of the two chimney breasts on the first floor. Each of these steel joists was supported at one end on the front or rear wall of the ground floor while at the other end, where they met, the joists were supported by three vertical timber props, arranged side by side on the line of the former spine wall. Before the FTT hearing the base of the wall had not yet been investigated by either of the experts, but the area has more recently been opened up and, as the Tribunal was able to observe on its inspection, the timber props rest on a brick dwarf wall at foundation level. Further work was done in the cellar, which was converted for use as a bathroom and laundry. The FTT found that this involved the lowering of the floor.[16]The ground floor work was completed in 2011 and signed off by the local authority building control officer on 14 July 2011.[17]Although reference is made in a witness statement prepared by Mr Bourne of the appellant to cracking to the first floor flat having been observed during a property inspection in January 2011, the first documented reference to a change of condition was in early 2012. On 16 January 2012 Mr Stephen Cook of Cook Steed Associates, Chartered Surveyors, wrote to Mrs Macrae-Brown saying that he had recently “been asked to inspect the upper unit and look at damage that has resulted as a consequence of your works”. He advised her that he had carried out an inspection armed with the 2009 schedule of condition that had been prepared by VM Architects and had “noted significant cracking that was not recorded on the schedule”.[18]Mr Cook subsequently prepared a schedule of remedial work dated 12 June 2012 after a meeting attended by LIM Engineering, the firm of consulting engineers who had advised Mrs Macrae-Brown in relation to the original works. The schedule makes no mention of work being required in the first-floor bedroom or living room, or on the spine wall dividing them, although significant cracking is described in the kitchen, bathroom and rear addition bedroom, all towards the rear of the building. Some of this cracking was on the rear external wall.[19]We were informed that the cracking observed by Mr Cook was made good at the expense of Mrs Macrae-Brown and the first floor flat was then redecorated.[20]Further damage to the first floor flat was noted by the appellant’s agents in mid-2014, which led to two inspections in October by BSVP, a firm of building surveyors. A letter of 7 November 2014 recorded their observations following what they described as an external view of the elevations from ground level and limited access internally.[21]Mr Bowles of BSVP stated that two issues had been raised by the occupiers of the ground floor and first floor flats. On the ground floor the complaint was of settlement over the door from the bedroom to the rear courtyard. On inspection it was discovered that the rear door had been replaced during the works and that the localised settlement observed was associated with a damaged soil pipe on the rear wall adjoining the door which had first been diagnosed in May 2013. On the 6 first floor the concern was “extensive cracking and fracturing to the plaster finish of the walls and ceilings throughout the flat". The surveyor observed “significant cracking to the partitions, walls and ceilings to all rooms … other than the kitchen”. Having cross referred to the photographic record prepared in 2009 he noted that the cracking to the rear rooms had not changed, but that there was some evidence of “recent cracking and plaster rutting within the lounge, first floor bedroom and stairwell”. A significant bow was also noted in the timber floor on both sides of the spine wall and the doors in that area were out of alignment and binding to their frames. It was recommended that details of the work to the spine wall at ground floor level be obtained as a prelude to further investigations.[22]The building’s insurers accepted that the problem of the localised subsidence affecting the rear elevation of the ground floor flat was attributable to damaged drains. This was confirmed following an inspection on 19 February 2015 by Crawfords, a firm of loss adjusters, whose report clearly differentiates between the crack damage to the rear elevation above the exit door, which was caused by subsidence referable to the defective drains, and the majority of the damage within the building which they attributed to the internal alterations “which have resulted in the deflection of the floors resulting in the damage observed”.[23]The appellant wrote to the Building Control Officer who inspected the first floor flat on 22 April 2015. He expressed surprise at the presence of “considerable cracking to the spine wall” as he had not previously understood there had been alterations in that area (it is not clear whether the senior building control officer who made this comment was the same officer as had signed off the works in 2011). The flat was redecorated in June 2015 before being re-let.[24]The BSVP report was sent to LIM Engineering for comment in April 2015 and they responded on 20 May. Mr Kurkic explained that he had been engaged by Mrs Macrae-Brown to advise on the ground floor extension and that the house had been subject to structural settlement which he attributed to the faulty drainage system and the proximity of trees. According to Mr Kurkic the internal modifications had not been within his brief (although LIM Engineeering prepared the drawings showing the removal of the rear chimney breast); he suggested that the replacement of the double door opening between the ground floor living room and kitchen with a single doorway would have increased rather than reduced the structural integrity of the building.[25]The appellant continued to seek the advice of BSVP and a further inspection of both flats was undertaken by Mr Bowles on 30 March 2016. He reported that on the first floor “the cracking remains prominent to the partitions and walls and is re-appearing despite having been redecorated in the Summer of 2015”. He took the recurrence of the cracking to indicate that movement was on going.[26]The appellant’s expert, Mr Sinclair-Johnson, carried out a visual inspection of the building and produced his first report in October 2016. He reported that the spine wall at first floor level had moved and cracked relative to the left hand flank wall and right hand party wall, and that the floor had dipped out of level. 7 The application and the FTT’s decision[27]On 12 December 2017 the appellant applied to the FTT for an order under section 168(4), Commonhold and Leasehold Reform Act 2002, determining that breaches of covenant had been committed. The application came before the FTT on 18 June 2018. After undertaking its own inspection of the property, the tribunal heard evidence from Mr Sinclair-Johnson and Mr Greig.[28]We were told that the time available for consideration of the oral evidence by the FTT was quite limited and that the experts were not cross-examined on the sequence of documents in the bundle prepared for the hearing. Nevertheless, when the FTT published its decision on 30 August 2018 it recorded specifically that “the documentation provided by the parties was sufficient for the decision of the Tribunal” and stated that it had “considered all of the documents provided” before making its determinations.[29]The FTT recorded in paragraph 7 of its decision that the issue it had to determine was whether the works carried out to the property by Mr Covic were in breach of covenant. It referred in particular to the removal of the front chimney breast on the ground floor and the lowering of the floor of the basement and the removal of part of the corbelling at the base of the party wall.[30]At paragraph 15 the FTT referred to the conclusions of the appellant’s expert, Mr Sinclair- Johnson, that the timber supports installed to support the steel beams taking the weight of the chimney breasts had caused movement and cracking in the spine wall of the first floor flat. It was also his opinion that the ground floor flat had not been kept in good substantial and tenantable repair and condition and that the tenant was failing to provide support for the first floor flat.[31]The FTT referred to the evidence of Mr Covic that the cracks in the first floor were historic and typical of an end-of-terrace Victorian house. It noted Mr Greig’s view that the use of three timber posts to support the steel beams was “adequate if not ideal or conventional”, and that the movement in the first floor was not due to inadequate support but was “a global problem resulting from the earlier removal of the stair wall prior to these works, the age of the building and the possibility of tree root disturbance.”[32]The experts faced the difficulty that at that stage neither of them had seen the base of the timber posts, and thus were unable to establish whether or not they were adequately supported. Mr Sinclair-Johnson’s hypothesis was that they may be resting on a horizontal timber beam which may have become compressed by the weight of the structure above causing the movement on the first floor. Mr Greig considered it was more likely that the beams were supported on a metal plate which would spread the weight. (As is now known, neither hypothesis was correct, and the posts rest on a masonry wall).[33]The FTT found that there had been breaches of clause 2(3) of the lease by the removal of the front (living room) chimney breast and the lowering of the floor in the basement, neither of which had been included in the licence for alterations. They found that the removal of the spine wall in the ground floor flat was not a breach of clause 3(1). 8[34]The only part of the FTT’s decision which is the subject of this appeal is its finding that there had been no breach of clause 3(1) in connection with the removal of this spine wall. It explained that conclusion at paragraph 29 of its decision, as follows:
“The Tribunal heard evidence from two experts. The evidence conflicted and therefore the Tribunal was unable to determine that the movement in the upper level of the property was due to the works on the spine wall and therefore no breach of clause 3(1) of the lease in connection with the removal of the spine wall.”
Although the FTT did not refer in terms to the burden of proof in its decision, it did so when it refused permission to appeal. Referring to “the clear difference of opinion between the two experts” as to the possible causes of the movement within the building, the FTT explained that that difference “led to the tribunal concluding that the applicant had failed to discharge the burden of proof in connection with the alleged breach.” The appeal[35]The Tribunal gave permission to appeal on the grounds that it was arguable that the FTT’s assessment of the evidence was flawed. It appeared to have decided the application entirely on the basis of the burden of proof, stating that because the evidence to the experts conflicted it was unable to determine the cause of the movement on the upper floor.[36]Mr Mendoza invited the Tribunal to allow the appeal for the reasons it had identified when it gave permission to appeal. The FTT reached its conclusion without undertaking any systematic consideration of the evidence. It was required to apply the civil standard of proof, but it did not explain why it was impossible to determine whether the work which had been carried out was more likely than not to have caused the damage to the first floor flat. Even if its process of reasoning had been sound, it had failed to give sufficient reasons for its decision so that the parties could understand why it had reached the conclusion it did.[37]On behalf of the respondent, Ms Wookey submitted the Tribunal should approach the appeal as a challenge to the FTT’s findings of fact, and that such an appeal presents a high hurdle for an appellant. She referred to the decision of the Court of Appeal in Fage UK Ltd v Chobani UK Ltd [2014] EWCA Civ 5 where, at [114] Lewison LJ explained the approach which an appellate court should take to the findings of fact of a first instance Judge or Tribunal. Appellate courts should not interfere with findings of fact by trial judges, unless compelled to do so. This applies not only to findings of primary fact, but also to the evaluation of those facts and to inferences to be drawn from them.[38]The same approach is applied in this Tribunal, which does not interfere with the conclusions of the FTT on an issue of fact other than in exceptional circumstances. The FTT has had the opportunity to consider the whole of the material put before it by the parties and, where it can be seen to have made a proper assessment of that material and has explained why it has reached the conclusion it has on the main contentious issues, this Tribunal should not prefer a different conclusion. Circumstances do exist, however, in which the Tribunal can and must interfere with the fact finding of the FTT. Those circumstances included where the FTT has resorted too readily to 9 the burden of proof as the means of resolving a disputed question of fact, including a disagreement between expert witnesses.[39]Neither counsel referred the Tribunal to any decision in which consideration has been given to the circumstances in which a fact-finding tribunal can properly fall back on the burden of proof to resolve a disputed question of fact. That was a surprising omission, given the terms in which the FTT had reached its decision and the basis on which permission to appeal was granted by this Tribunal.[40]The authorities demonstrate that cases in which a resort to the burden of proof will be a legitimate route to a decision are rare. How rare may depend on the nature of the critical issue. In Cooper v Floor Cleaning Machines Ltd [2003] EWCA Civ 1649 Scott Baker LJ contrasted cases in which the issue was whether one or other of two witnesses was telling the truth about events which only they had observed, and cases involving disagreement between expert witnesses. A case in the former category was Ashraf v Akram [1999] EWCA Civ 640, which concerned a fight between the claimant and the defendant, each of whom the sued the other for assault. The trial Judge dismissed both claims on the ground that neither had satisfied the burden of proof. Sedley LJ began his judgment by saying this:
“The authorities confirm what one would expect, namely that a trial judge's duty is to decide the issues relevant to his judgment and not to evade them. But the authorities also recognise that there will be the occasional case in which the common path to the resolution of the ultimate issue, namely who is telling the truth, is blocked by an intractable evidential tangle. In such a case it may be not only legitimate but inevitable that the judge will hold that the plaintiff has failed to show a preponderance of evidential probability in favour of his case. Where there are cross-claims, in such a situation the counterclaim will also logically fail.”
In Cooper, Scott Baker LJ contrasted cases of that sort with Sewell v Electrolux Ltd [1997] EWCA Civ 2443, in which the claimant sought damages for an accident at work and the issue was as to the cause of his back pain. The experts giving medical evidence disagreed but the trial judge had not tried to resolve the issue and had dismissed the action on the basis that the claim had not been proven. Scott Baker LJ said:
“The judge was not entitled to resort to the primary burden of proof in lieu of resolving a difference of medical opinion. The necessary findings of fact could and should have been made.”
[41]A recent review of the relevant authorities is contained in the judgment of Rose J (with whom Kitchin LJ agreed) in the decision of the Court of Appeal in Constandas v Lysandrou [2018] EWCA Civ 613 at [22]-[27]. Rose J began her review by referring to Stephens v Cannon [2005] EWCA Civ 222, which concerned the quantification of an award of damages awarded in lieu of specific performance of a contract for the sale of a parcel of development land. The Master had received conflicting expert evidence about whether the land was worth more or less than the contract price but he had been unable to choose between the rival views and had decided the case on the burden 10 of proof. After referring to the relevant authorities, Wilson J, with whom Arden and Auld LJJ agreed, set out the following propositions ([46]):
"(a) The situation in which the court finds itself before it can despatch a disputed issue by resort to the burden of proof has to be exceptional. (b) Nevertheless, the issue does not have to be of any particular type. A legitimate state of agnosticism can logically arise following enquiry into any type of disputed issue. It may be more likely to arise following an enquiry into, for example, the identity of the aggressor in an unwitnessed fight; but it can arise even after an enquiry, aided by good experts, into, for example, the cause of the sinking of a ship. (c) The exceptional situation which entitles the court to resort to the burden of proof is that, notwithstanding that it has striven to do so, it cannot reasonably make a finding in relation to a disputed issue. (d) A court which resorts to the burden of proof must ensure that others can discern that it has striven to make a finding in relation to a disputed issue and can understand the reasons why it has concluded that it cannot do so. The parties must be able to discern the court's endeavour and to understand its reasons in order to be able to perceive why they have won and lost. An appellate court must also be able to do so because otherwise it will not be able to accept that the court below was in the exceptional situation of being entitled to resort to the burden of proof. (e) In a few cases the fact of the endeavour and the reasons for the conclusion will readily be inferred from the circumstances and so there will be no need for the court to demonstrate the endeavour and to explain the reasons in any detail in its judgment. In most cases, however, a more detailed demonstration and explanation in [a] judgment will be necessary."
The Court of Appeal held that the Master's decision could not stand, as he had not sufficiently striven to come to a decision or explained why he could not reasonably do so.[42]Rose J then referred to the fact that the propositions in Stephens v Cannon had been refined by the Court of Appeal in Verlander v Devon Waste Management [2007] EWCA Civ 835. The issue in that case concerned the circumstances in which an industrial accident had taken place. Auld LJ expressed the relevant principles as follows: "19. …First, a judge should only resort to the burden of proof where he is unable to resolve an issue of fact or facts after he has unsuccessfully attempted to do so by examination and evaluation of the evidence. Secondly, the Court of Appeal should only intervene where the nature of the case and/or the judge's reasoning are such that he could reasonably have been able to make a finding one way or the other on the evidence without such resort. …[24]When this court in Stephens v Cannon used the word "exceptional" as a seeming qualification for resort by a tribunal to the burden of proof, it meant no more than that such resort is only necessary where on the available evidence, 11 conflicting and/or uncertain and/or falling short of proof, there is nothing left but to conclude that the claimant has not proved his case. The burden of proof remains part of our law and practice - and a respectable and useful part at that - where a tribunal cannot on the state of the evidence before it rationally decide one way or the other."[43]In Constandas v Lysandrou the Court of Appeal found that there had been no failure on the part of the trial judge to grapple fully with the evidence over the identity of the party who had made a payment towards the deposit on the purchase of a house in 1959, nor had she failed to explain what she had done. That was not enough in itself, however, to dispose of the appeal:
“The test is not whether the reasoning given adequately explains what the Judge has done, but whether what the Judge has done is in fact justified or whether she could reasonably have been able to make a finding of fact one way or the other.”
The Court of Appeal then reviewed the evidence and concluded that there was no basis on which the Judge could have reached a conclusion and her decision therefore stood.[44]Returning to the issues for the FTT in this case, there was no doubt that certain works, including the removal of the chimney breast in the front room were breaches of clause 2(3) of the lease. Closer examination of the plans showing the alterations approved by the appellant would also have identified an additional breach of the covenant against alterations in that the whole of the spine wall on the ground floor (rather than just the portion furthest from the flank wall) had been removed and replaced. The remaining question for the FTT was whether the ground floor flat had been kept “in good substantial and tenantable repair and condition… so as to support shelter and protect” the first floor flat. If the answer to that question was negative a further breach of covenant would have been demonstrated.[45]The FTT was faced with a difference of opinion between the experts. Mr Sinclair-Johnson was of the view that the movement and cracking apparent in the spine wall of the first floor was caused by the removal of parts of the original spine wall in the ground floor flat (which had almost certainly been of brick construction as was normal practice in Victorian houses of this type), by the general arrangement of support which the leaseholder had put in place beneath it, and by the removal of the chimney breasts at ground floor level. He also questioned the adequacy of support provided for the remaining chimney structures at first floor and attic level. Mr Greig, on the other hand, took the view that the movement in the upper floor was attributable to the earlier removal of the stair wall, the age of the building and the possibility of disturbance caused by tree roots.[46]The assessment of the cause of the movement was made more complicated by the absence of information about what the new vertical timber beams rested on. Mr Sinclair-Johnson suspected they rested on a timber cross beam which had been compressed by the weight of the steel beams and masonry which they supported. Mr Greig thought it was equally likely that they rested on a metal plate which would spread the weight and be resistant to compression. But the FTT was not required to diagnose the mechanism causing the movement of the upper floor with precision or certainty. It was no doubt relevant for it to consider what might explain the condition of the first floor, but in order to decide whether there had been a breach of covenant its task was a more limited 12 one, namely, to determine whether it was more likely that the movement was caused by something done by the leaseholder in the course of the works than that it had an alternative cause.[47]Faced with that issue, and with the divergence of view between the experts, it was essential for the FTT to ask itself what the evidence as a whole contributed to the picture. When reading the decision of the FTT the Tribunal is immediately struck by the extremely limited approach it took to that evidence. Apart from briefly recording the rival views of the experts there is no indication that the FTT embarked on a review of the material available to it in order to address the relevant question. The decision contains no reference to the witness statement of Mr Bourne, the director of the appellant who had provided a narrative of the events leading to the making of the application and who exhibited the reports and correspondence we have referred to in paragraphs 12 to 25 above. More significantly still, the decision did not refer to the existence of those reports and correspondence themselves, nor to their contents.[48]The FTT said in its decision that it had considered all of the documents provided to it, but it made no use of them in coming to its conclusion, or at least it is not possible for anyone reading the decision to know whether it made use of them or not. There is therefore no doubt in our minds that the FTT did not show that it had undertaken the examination and evaluation of the evidence which is essential before a fact-finding tribunal may fall back on the burden of proof to make the decision for it.[49]Nor are we left in any doubt that the weight of the material available to the FTT ought to have caused it to be satisfied that the leaseholder was in breach of the covenant to keep the ground floor flat in good condition so as to provide support to the first floor flat. With the sole exception of the comment by Mr Kurkic of LIM Engineering in May 2015 that the support to the upper floor had been improved rather than weakened, the evidence and views of relevant professionals before the dispute pointed generally in one direction.[50]The first document of critical importance to the resolution of the application was the schedule of condition prepared by VM Architects in July 2009 before the work commenced. The architects were instructed by the leaseholder and it is reasonable to assume that the schedule contains a reasonably comprehensive account of any defects visible in the upper floor of the building. It therefore provides a base line against which any subsequent changes can be assessed. That was the purpose of compiling it, yet the FTT made no reference to it and it appears the experts may not even have been aware of it when they prepared their initial evidence. The schedule refers to a certain amount of cracking in the first floor flat, including in the bedroom and living room, but describes it as minor. Cracking had also been observed in the ground floor flat in March 2009, but the loss adjuster who recorded it considered it to be historic and the result of normal wear and tear, and the schedule of condition gives the same impression. Nor is there any suggestion in the schedule that the floors sloped towards the spine wall or that the picture rail on that wall in the living room appeared to have dropped out of alignment with the rails on the flank wall and party wall.[51]Other documents available to the FTT allow the timing of the emergence of problems to be narrowed down. According to Mr Covic’s evidence in his witness statement provided to the FTT the work was completed during 2010, although the project was signed off by the building control officer on 14 July 2011. By January 2012 Mr Cook, the appellant’s agent, was writing to Mrs Macrae-Brown informing her that he had recently inspected the first floor flat and had “noted 13 significant cracking that was not recorded on the schedule”. That suggests that within little more than a year of the completion of the work on the ground floor damage was manifest on the first floor which had not previously been present. The precise location of that additional cracking is not recorded, and the focus of cracking recorded by Mr Cook following his inspection with LIM Engineering in June 2012 was towards the rear of the building.[52]By November 2014 the report of Mr Bowles of BSVP recorded “significant cracking to the partitions, walls and ceilings to all rooms … other than the kitchen” including “recent cracking and plaster rutting within the lounge, first floor bedroom and stairwell”. A significant bow was also noted in the timber floor on both sides of the spine wall and the doors in that area were out of alignment and binding to their frames. The deflection of the floors was also noted by Crawfords in February 2015 and attributed to the internal alterations. It is clear that movement was continuing as cracks reopened after decoration was completed.[53]The documented sequence of events is strongly suggestive of a causal connection between the work carried out on the ground floor by the leaseholder and the damage observed on the first floor. Unless the damage in different areas was caused for entirely different reasons, the impression is of a flat which, before the works, was largely stable and with no obvious signs of ongoing movement having become unstable and subject to progressive movement after the works. It was not suggested that the localised subsidence caused by the failed drain at the rear of the building was to blame for the extensive internal cracking. Nor was there any evidential basis provided for the suspicion that tree roots might be causing the problem (and it is common ground between the experts, now at least, that any such cause can be discounted).[54]The only alternative cause suggested to the FTT by Mr Greig was the removal of the stair wall some time prior to the works, but there was no suggestion that that had occurred recently and the 1989 lease plan showed the flat in the same configuration as the “as existing” plans attached to the 2010 licence. It is therefore improbable that the removal of the stair wall alone caused the changes observed after preparation of the schedule of condition, and Mr Greig’s suggestion could therefore be discounted.[55]The documentary material provided by the parties to the FTT was amply sufficient in our judgment to lead to the conclusion that the alterations carried out on the ground floor had caused a loss of support which had precipitated the occurrence of damage to the first floor flat. That conclusion was sufficient to enable the FTT to answer the question raised by the application, and it ought to have done so by making a finding of fact to that effect, rather than relying on the burden of proof to sustain the opposite conclusion.[56]Because the Tribunal indicated when it gave permission to appeal that, if the appeal was allowed it would conduct a rehearing of the application, the parties prepared additional evidence dealing with the further investigations and observations which had been made since the hearing before the FTT. We heard that evidence and undertook our own inspection, but the conclusion we have reached is that the outcome of the appeal is clear without the need to rely on it. It is nevertheless appropriate for us to summarise the conclusions we reached on our inspection and on consideration of the further material provided to us which was not before the FTT. 14[57]The jurisdiction of the FTT under section 168(4), Commonhold and Leasehold Reform Act 2002 is to determine “that a breach of covenant or condition in the lease has occurred”. Once a determination has been obtained a landlord is in a position to give notice under section 146, Law of Property Act 1925 warning the leaseholder that it intends to commence proceedings for the forfeiture of the lease. If proceedings are commenced one significant issue is whether relief against forfeiture ought to be granted to the leaseholder and, if so, on what terms. Any such terms are for the Court to determine and it is not within the jurisdiction of the FTT to devise them. Nevertheless, in considering what terms may be appropriate, or whether relief from forfeiture should be refused, the court will be assisted by a clear statement by the FTT in its decision of the breach which it is satisfied has been committed. Our inspection and the evidence before us[58]Mr Sinclair-Johnson produced a supplemental report in July 2019 following a further inspection of the two flats. Additional opening up of the ground floor had been carried out, and this revealed that the timber posts supporting the steel beams inserted following the removal of the front and rear chimney breasts directly bear upon a 9” brick pier forming part of the dwarf sub-floor sleeper wall which formed the base of the original spine wall. He had originally assumed that the posts rested on a timber bearer laid along a dwarf wall, and he was surprised to find that it was directly onto the brick. Although downward movement caused by crushing of the softwood bearer could now be discounted, he was concerned that the load had not been spread along the sleeper wall by the use of metal plates under the base of the pillars. In any event, fast growing softwood posts are liable to compress under long-term loading and Mr Sinclair-Johnson considered the opportunity for movement still remains. As Mr Greig had acknowledged, the use of timber supports for such considerable potential loads was neither ideal nor conventional. Despite the means of support differing from his earlier assumptions, Mr Sinclair-Johnson remained of the opinion that the movement and damage to the upstairs flat which was clearly still ongoing had been caused by the ground floor works.[59]Mr Sinclair-Johnson produced a photograph, taken at his visit on 4 June 2019 (at which Mr Greig was also in attendance), showing a “birds-mouth” crack in the spine beam that formed the top of the ground floor part of the original spine wall where it over-sails the new steels now supporting the chimney breasts. The photograph shows a soft wood wedge has been inserted between the steels and the beam, which can only have been during the development works and not historically. He described this type of failure in the spine beam as typical of the damage that occurs due to overloading. Its occurrence in this location provided further support for his conclusion that the works have caused the damage and not any of the alternative factors promulgated by Mr Greig.[60]In his supplementary report produced in August 2019, Mr Greig said that the corbelled brick foundations onto which the timber posts bear were “positively keyed into the adjacent gable wall foundations” and that there were “no signs of settlement or differential movement at foundation level that could be associated with settlement of the posts”. His own inspections, and the engineers’ calculations which he had considered, confirmed his view that the support structure of both the chimney breasts is adequate. The works have been in place since 2009 and there is no indication of 20mm vertical settlement that Mr Sinclair-Johnson’s conclusions implied, nor did he consider there was evidence of ongoing structural movement in that location. 15[61]Mr Greig acknowledged that there is evidence of downward movement to the spine wall in the first floor flat. The slopes to the floors in the front bedroom and bedroom 2 suggest that the wall has dipped towards the middle above where the double doors between the two ground floor rooms were removed. There is no corresponding movement to the new timber stud framed wall in the location of the old spine wall in the ground floor flat. There are signs of both historic and recent movement in the finishes to the first floor flat, but Mr Greig could not understand why the freeholder’s investigations had concentrated on the support to the chimney breasts where there is little sign of movement other than some slight outward bowing to the flank wall common in properties of this type (although he had not undertaken any specific investigations such as a plumb- line survey). In Mr Greig’s view the evidence suggested that the main movement is towards the other end of the spine wall around the staircase and where the door from the lobby into the flat has been moved. There is cracking around the doorway into the front bedroom where crack monitoring gauges have now been applied and it is evident that with the removal of the “inverted L-shaped” section of the original spine wall there is no structural support to new internal back bedroom wall (onto internal lobby). However, that was no different prior to the works being carried out, the support to that area not having been brick.[62]Mr Greig remained of the view that the cause of the movement (which he did not think was still ongoing) was due to issues other than the respondent’s works. He acknowledged that the damage was unlikely to have been caused by the former drainage problems or the existence of the tree in the pavement outside the flank wall, but he thought the fact that ground levels beneath the structure were different (because of the partial basement) could historically have caused some rotational movement to the structure.[63]Our inspection confirmed our conclusion that the damage that has occurred is, and can only have been, caused by the works that the respondent has undertaken. The key piece of evidence is the 2009 schedule of condition (which neither of the experts had seen when preparing their initial reports). There was at that time evidence of minor cracking to plaster finishes in the first floor flat, but nothing of any particular significance and no mention whatsoever of any problems with the floors which are now seriously and noticeably out of true. The extensive cracks which are now evident to covings and cornices and around doorways within the first floor flat particularly in the front bedroom and inner lobby (many of which now have monitoring gauges installed) point unequivocally to settlement of the spine wall. Despite the fact that works of repair and redecoration have been carried out on at least two occasions, the cracks which are now visible are severe and indicate significant ongoing movement.[64]As to the support for the two removed chimney breasts, whilst Mr Greig says there is no movement or settlement evident to the supporting posts, and that the sleeper wall onto which they bear is “positively keyed” into the foundation brickwork of the flank wall, this did not seem to us to be the case. The pier, or part of the sleeper wall onto which the posts directly bear, has vertical cracks at the point where the bricks are stitched into the flank wall foundation, suggesting that the weight of the posts may have caused this downward movement. Although the movement itself is minimal it could be a further indicator that some settlement has occurred at this point. The junction with the flank wall is not the only area to have suffered movement, and any that has occurred at this point is only a part of the overall damage that is now evident. The removal of the majority of what we accept would have been a load-bearing brick spine wall and its replacement with a modern softwood framed non load-bearing stud partition has clearly caused significant movement towards the centre, over where the double doors between the two rooms were located. 16[65]We prefer Mr Sinclair-Johnson’s evidence and agree with his conclusions. Mr Greig’s alternative hypotheses are unconvincing and we reject them. In the absence of other credible causes for the condition of the first floor flat, we conclude that it is attributable to the removal of support as a result of the respondent’s works. Those works were undertaken before the respondent acquired his interest in the flat, but they were a breach of clause 3(1) of the lease at that time. They remain a breach of the respondent’s own continuing obligation to keep the ground floor flat in good substantial and tenantable repair and condition so as to support the first floor of the building. Disposal[66]For these reasons we allow the appeal. The FTT was satisfied that breaches of clause 2(3) of the lease had occurred by the removal of the front (living room) chimney breast and the lowering of the floor in the basement without the appellant’s consent. We additionally determine that clause 3(1) of the lease has been and continues to be breached by the withdrawal of adequate support to the upper floor. Paul Francis FRICS Martin Rodger QC Deputy Chamber President Dated 9 January 2020