[2024] UKUT 00300 (LC)

The hearing on 18 December 2023 was attended by Mr Deane and by the Council’s Head of Law, Enforcement and Litigation, Mr Mehat.

In its decision, issued on the same day, the FTT recorded that the Council had imposed the financial penalty because it was satisfied that Mr Deane had committed the offence of managing an unlicensed HMO at No. 86A. It noted that it was common ground that he was not the owner of the property but that he was specified in the tenancy agreement as the landlord and had been a director of Tantum Property, which had been identified by one of the tenants as the manager. It said that the issue in the appeal was why Mr Deane’s name appeared on the tenancy agreement.

The FTT recorded what it had been told by Mr Deane at the hearing, prefacing its account with the observation that he had been unable to give any adequate explanation for what it described as “the abject failure to comply with the directions”. He had blamed Mr Kasi, whose email address had been included in the notice of appeal and said that he had not seen the emails sent to that address or been made aware of the direction to file a bundle of documents until the morning of 15 December, when he was notified (presumably by Mr Kasi) that the appeal had been struck out. He had been aware of the requirement to pay the fee, because Mr Kasi told him, but it was not clear when he became aware of the date of the hearing.

The FTT did not accept Mr Deane’s explanation or that Mr Kasi was to blame for his failure to engage with the proceedings. It described the background to the appeal as “one of obfuscation”. It said that it was satisfied that the tribunal’s correspondence had been sent to the email address provided by Mr Deane “and that he would have received this”.

The FTT then directed itself on the law. It referred first to the decision of the Supreme Court in BPP Holdings, which encourages tribunals to follow a similar approach to procedural non-compliance and relief against sanctions as the civil courts. The FTT then referred to rule 3.9 of the Civil Procedure Rules which provides that on an application for relief from any sanction imposed for a failure to comply with a rule, practice direction or court order, the court will consider all the circumstances of the case, to enable it to deal justly with the application, “including the need – (a) for litigation to be conducted efficiently and at proportionate cost; and (b) to enforce compliance with rules, practice directions and orders.”

The FTT next referred to Denton v T H White Limited [2004] EWCA Civ 906 in which the Court of Appeal (at [24]) laid down the sequential approach now followed by civil courts when exercising their power under CPR 3.9 to grant relief against sanctions for non-compliance. That approach involves three stages: (i) identify and assess the seriousness of the failure to comply; (ii) consider why the default occurred; (iii) evaluate all the circumstances of the case to enable the court to deal justly with the application, including giving consideration to the matters specifically identified in CPR 3.9(1)(a) and (b), the need for litigation to be conducted efficiently and the need to enforce compliance with rules, practice directions and orders. The FTT reminded itself that the Court of Appeal had said in Denton (at [32]) that the two factors identified at (a) and (b) in CPR 3.9(1) “are of particular importance and should be given particular weight at the third stage when all the circumstances of the case are considered.”

The FTT finally referred to a decision of this Tribunal, Haziri v Havering LBC [2019] UKUT 330 (LC), in which I had applied Denton and BPP Holdings after citing Global Torch Ltd v Apex Global Management Ltd (No 2) [2014] UKSC 64, in which (at [26]), Lord Neuberger had said that the strength of a party's case on the ultimate merits of the proceedings was “generally irrelevant” when it comes to case management issues. I had then affirmed (at [27]) that the merits of the appeal in Haziri were not a relevant factor in that case. The issue in the appeal (which was commenced out of time) was whether the property in question was an HMO, which depended on facts which had not yet been established and on which the FTT could not properly have formed any view.

Having identified the legal principles it would apply the FTT proceeded to determine the application to reinstate the appeal by addressing the three stages identified by the Court of Appeal in Denton. Rather than paraphrase that treatment I will set it out the relevant paragraphs of the decision in full:

“Stage 1: The Seriousness of the Failure to Comply

24.

The failure is very serious. This was Mr Deane’s appeal. He should have ensured that he complied with the directions so that his case could be determined fairly and justly. On 1 September, the Tribunal had set the matter down for hearing on 18 December. The hearing would not have been able to proceed given the late service of his Bundle. Mr Deane’s involvement in “the control or management” of the property is a fact sensitive issue.

Stage 2: The Reason for the Default

25.

Mr Deane has failed to provide any adequate explanation for his failure to comply with the Directions. We do not accept his explanation that this was all the fault of Mr Kasi.

Stage 3: Evaluating all the circumstances of the case

26.

At this stage, the two factors identified in (a) and (b) of CPR 3.9(i) are of particular importance. These are: (a) for litigation to be conducted efficiently and at proportionate cost; and (b) to enforce compliance with rules, practice directions and orders.

27.

Any party is required to comply with any Directions given by the Tribunal. Mr Deane has had no regard to these.

Conclusion

28.

Taking all these factors into account, we are satisfied that this application should not be reinstated. The procedural breaches have been serious. No adequate explanation has been provided for these breaches. These failures have caused unnecessary expense to the parties. It has also made undue demands upon the resources of this tribunal.”