[2024] UKUT 109 (LC)

The third issue in the appeal concerns the FTT’s statement in paragraph 12 of its decision that the 2002 Act was not intended to enable the right to manage to be acquired where the subject premises comprise a number of blocks whose freeholds are held by different freeholders. The FTT supported that statement with a reference to Triplerose, but it is common ground that the proposition to which it referred was contained in a consultation paper which predated the original draft bill and is not a commentary by the Court of Appeal on the Act itself. The Act gives partial effect to the statement in the consultation paper in paragraph 2 of Schedule 6.

Schedule 6 identifies premises which are excluded from the right to manage and paragraph 2 provides that:

“Where different persons own the freehold of different parts of premises falling within section 72(1), this Chapter does not apply to the premises if any of those parts is a self-contained part of the building.”

The consequence of parts of a self-contained building being held in different freeholds is therefore more complicated than the simple statement referred to by the FTT.

In this case the freehold interest in Saltley House is held by Notting Hill Genesis. The freehold in Harborough House is held by Adriatic Land 3. Saltley House and Harborough House are structurally attached to each other. If one or other is self-contained, as described in section 72(3) and (4), Chapter 1 of Part 2 of the 2002 Act will not apply to the whole of the building.

Although there is a little more evidence concerning Saltley House, in the form of one of the sample leases which shows its outline at basement level immediately adjoining the car park, it is not possible from that plan to determine whether it constitutes a vertical division of the larger building comprising the three blocks and the car park, nor it is possible to know whether it could be redeveloped independently of the rest of those structures.

The only point Mr Bowker made about this issue was that permission to appeal had not been granted to enable the point to be taken. His only response to Mr Fain’s request for permission to appeal to be granted at this stage, was that no explanation had been given why the point had not been taken earlier. That objection does not dissuade me from granting permission to appeal on this issue. The Management Company relied on the split freehold issue and persuaded the FTT that it was fatal to the application, but it did so without adducing the necessary evidence to demonstrate that Saltley House or Harborough House were self-contained. Without that evidence the point ought not to have succeeded.

Once again, therefore, although the FTT did not consider the relevant questions and its decision must be set aside, it is not possible for me to make any determination of my own on the basis of the evidence available.