Holding & Management (Solitaire) Ltd v Sherwin, Court of Appeal - Lands Tribunal, December 10, 2010,  UKUT 412 (LC)
|Resolution Date:||December 10, 2010|
|Issuing Organization:||Lands Tribunal|
|Actores:||Holding & Management (Solitaire) Ltd v Sherwin|
© CROWN COPYRIGHT 2010
UT Neutral citation number:  UKUT 412 (LC)
LT Case Number: LRX/67/2009
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
LANDLORD AND TENANT - service charges - limitation on service charges where costs incurred more than 18 months before demand - advance payments and balancing charges - held no limitation on advance payments - held no limitation on balancing charges since relevant costs incurred less than 18 months before demand - appeal allowed - Landlord and Tenant Act 1985 s 20B
IN THE MATTER OF AN APPEAL AGAINST A DECISION OF
THE MIDLAND RENT ASSESSMENT PANEL
HOLDING & MANAGEMENT
MISS STEPHANIE SHERWIN Respondent
Re: 48 Florence Road,
Coventry CV3 2AL
Before: The President
Sitting at Birmingham Civil Justice Centre, Priory Courts,
33 Bull Street, Birmingham, B4 6DS
on 10 November 2010
and at 43-45 Bedford Square, London WC1B 3AS
on 1 December 2010
Justin Bates instructed by Claire Banwell-Spencer, solicitor, Head of Legal, Peverel Property Management, Luton, for the appellant
The Respondent did not appear and was not represented
The following cases are referred to in this decision:
Gilje v Charlesgrove Investments Ltd  1 All ER 91
Islington London Borough Council; v Abdel-Malek  L & TR 2
Brennan v St Paul's Court Ltd  UKUT 403 (LC)
Paddington Walk Management Ltd v Peabody Trust  L & TR 89
The following further cases were referred to in argument:
Redendale Ltd v Modi  UKUT 346 (LC)
Capital & Counties Freehold Equity Trust Ltd v B L Plc  2 EGLR 49
Hyams v Wilfred East Housing Co-operative Ltd  1 EGLR 89
1. This is an appeal by the landlord against a decision of the leasehold valuation tribunal for the Midland Rent Assessment Panel on an application under section 27A of the Landlord and Tenant Act 1985. The application was made by Miss Stephanie Marie Sherwin, who is the tenant of a flat, 48 Florence Road, Coventry CV3 2AL, under a lease for 125 years from 1 January 2004. In its decision of 28 February 2009 the LVT determined the amounts payable by Miss Sherwin in respect of service charges for the years 2005/6, 2006/7 and 2007/8 and the amount payable by her by way of advance payments for the year 2008/9. In determining the amounts for the years 2006/7 and 2007/8 the LVT made deductions from the amounts that would otherwise have been payable to reflect the application of section 20B of the Act, which places a limitation on service charges through a time limit on the making of demands. The appellant contends that the LVT wrongly applied this statutory provision, and it appeals with permission granted by me.
2. Section 20B provides as follows:
``Limitation of service charges: time limit on making demands.
(1) If any of the relevant costs taken into account in determining the amount of any service charge were incurred more than 18 months before a demand for payment of the service charge is served on the tenant, then (subject to subsection (2)), the tenant shall not be liable to pay so much of the service charge as reflects the costs so incurred.
(2) Subsection (1) shall not apply if, within the period of 18 months beginning with the date when the relevant costs in question were incurred, the tenant was notified in writing that those costs had been incurred and that he would subsequently be required under the terms of his lease to contribute to them by the payment of a service charge.''
3. ``Service charge'' is defined in section 18 as follows:
``Meaning of `service charge' and `relevant costs'
(1) In the following provisions of this Act `service charge' means an amount payable by a tenant of a dwelling as part of or in addition to the rent -
(a) which is payable, directly or indirectly, for services, repairs, maintenance, improvements or insurance or the landlord's costs of management, and
(b) the whole or part of which varies or may vary according to the relevant costs.
(2) The relevant costs are the costs or estimated costs incurred or to be incurred by or on behalf of the landlord, or a superior landlord, in connection with the matters for which the service charge is payable.
(3) For this purpose -
(a) `costs' includes overheads, and
(b) costs are relevant costs in relation to a service charge whether they are incurred, or to be incurred, in the period for which the service charge is payable or in an earlier or later period.''
4. Under clause 3 of her lease the tenant covenanted as follows:
``3.2 In respect of every Maintenance Year to pay the Service Charge to the company by two equal instalments in advance on the half-yearly days provided that in respect of the Maintenance Year current at the date hereof the Lessee shall on execution hereof pay a due proportion of the current Service Charge specified in paragraph 11 of the Particulars.
3.3 To pay the Company on demand a due proportion of any Maintenance Adjustment pursuant to paragraph 3 of Part II of the Fourth Schedule.''
5. ``Maintenance Year'' is defined (clause 1.6) to mean ``every twelve monthly period ending on the 1st day of April the whole or any part of which falls within the term.'' ``Service Charge'' is defined (clause 1.8) as follows:
``1.8 `the Service Charge' means the proportion set out in paragraph 12 of the Particulars (or such other proportion as may be determined pursuant to Part 1 of the Fourth Schedule) of the Annual Maintenance Provision for the whole of the Block and the Estate for each Maintenance Year (computed in accordance with Part II of the Fourth Schedule).''
``Annual Maintenance Provision'' is defined (clause 1.7) as consisting of a sum calculated in accordance with Part II of the Fourth Schedule.
6. The half-yearly days are 1 April and 1 October (paragraph 10 of the Particulars). The ``Service Charge Proportion'' is specified in paragraph...
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