[2025] UKUT 19 (LC)

The lease requires the respondent to maintain, repair and decorate the exterior of the building and so of course charges for external decoration will be payable from time to time. This work was done in 2023, and before it was carried out the respondent engaged in a consultation exercise pursuant to section 20C of the Landlord and Tenant Act 1985. The leaseholders objected to the work being done because they said it was not needed, having been done well a few years previously; but in any event they provided a quote in the sum of £4,700. The respondent nevertheless engaged contractors at a price of £12,886.58.

The leaseholders’ case in the FTT, as Mr Rana explained in his evidence, was that the work was unnecessary, but that if it was necessary then the cost was too high and the quote they had obtained should be regarded as an indication of what would have been a reasonable cost for this decoration.

The only material before the FTT from the respondent on this point was the respondent’s comment in the Scott Schedule:

“this went through a consultation

no alternative quote provided at the time

estopped from claiming this.”

The FTT’s decision was this:

“The tribunal finds the applicants are not estopped from challenging this item.

The tribunal also determines it is the respondent’s obligation to carry out works of redecoration to the exterior and may carry them out ‘from time to time when reasonably necessary’ (The Fifth Schedule). Although the applicants may not have wanted the works to be carried out, it is for the respondent to determine how it will carry outs its obligations and in the absence of any independent evidence to suggest this work was not required, the tribunal allows this sum in full.”

What the argument about estoppel was I do not know, but at any rate it was determined in the leaseholders favour and so I do not have to deal with it. As to the substantive determination, the FTT again misunderstood the evidential situation with which it was faced. The leaseholders had raised a prima facie case, in their statement of case, in the Scott Schedule, and in Mr Rana’s statement. They had therefore shifted the evidential burden to the respondent; and the respondent provided no evidence in response. It was therefore bound to be extremely difficult for the FTT to find that the charges were reasonable and payable. It would not be impossible; the FTT might be persuaded in argument that no prima facie case had actually been made, for example if counsel for the respondent could show that the leaseholders’ evidence was incorrect, but in that case the FTT would have to explain why it had made its decision on that basis. It is difficult to escape the conclusion that the FTT did not understand this. The leaseholders’ responsibility was not to prove that the cost was unreasonably incurred but to raise a prima facie case that there was a problem. There was certainly no reason why they should have produced “independent” evidence; more fundamentally there was no reason for the FTT to disagree with what Mr Rana said about the necessity for the work was incorrect. It did not even need to make a finding of fact that Mr Rana was right; the position was simply that the leaseholders had raised a prima facie case that the work was unnecessary (or, if the work was necessary, that the cost was unreasonable); the landlord had produced no evidence in response, not even a witness statement from its managing agent; it was therefore not open to the FTT to find that the cost was reasonably incurred.

The FTT’s decision is set aside, being unexplained and, apparently, made on the basis of an error of law about the evidence. I substitute the Tribunal’s own decision that the cost of the external decoration, in the sum of £12,886.58, was not reasonably incurred and is not payable by the leaseholders.

The appeal has therefore succeeded on all three substantive grounds.