[2025] UKUT 371 (LC)

Mr and Mrs Williams became Council tenants of their flat in 1996 and completed the purchase of their current lease on 29 July 2002 after exercising their statutory right to buy. Their lease is for a term of 115 years and reserves an annual ground rent of £9.

The Council is referred to in the lease as “the Lessor” and Mr and Mrs Williams are referred to as “the Lessee”. By clause 3 they agreed to pay the Management Charge which is defined as an annual sum to be notified by the Council representing “the due and proper proportion of the reasonable estimated amount” required to cover the cost incurred by the Council in carrying out certain functions and obligations referred to in clauses 3, 6 and 8 and in the covenants in the Ninth Schedule.

The “due and proper proportion” referred to in clause 3 is not a fixed proportion and, in practice, the Council has apportioned its expenditure so that Mr and Mrs Williams contribute 0.127877% to what the Council refers to as “Estate costs”, 2.903226% towards what it calls “Block costs” (including the costs of a booster pump and lifts serving Hensley Point) and 0.725806% towards heating maintenance costs. The exact basis of these apportionments is not known, but it is assumed that for Estate costs they are related to the number or size of the flats, houses and other premises on the whole of the Gascoyne Estate, for Block costs they are related to the number of units in Hensley Point, and for heating costs to the number of units in the four “Point” blocks served by the communal heating system.

The Council’s relevant obligations are found in the Ninth Schedule to the lease. In summary, these require it, by paragraph 1, to keep the following in good and substantial repair and condition:

Paragraph 2 of the Ninth Schedule is concerned with insurance and reinstatement of the Block (including the demised premises) and paragraph 5 with management of the Block.

Paragraph 3 obliges the Council to keep lighted, clean and tidy “all such parts of the Reserved Property as are lighted or should be lighted and keep clean and tidy the said common halls staircases landings steps passages estate roads doors windows pathways estate roads areas forecourts and courtyards.” Paragraph 4 deals with repainting and decorating the exterior of the Block and such of the common parts of the Reserved Property as are usually so treated.

Finally, paragraph 6 refers to carrying out “such other works in respect of the Block or the Estate as are in the reasonable opinion of the Lessor necessary for its proper maintenance and management including works of improvement”. This paragraph contains the first and only reference to “the Estate” in the Ninth Schedule (although “estate roads” are mentioned twice in paragraph 3).

It can be seen that the Council’s maintenance obligations are described by reference to “the Estate”, “the Block”, and “the Reserved Property”. These expressions are defined in the first recital to the lease by reference respectively to the First, Second and Third Schedules. The definitions are introduced and qualified by the words “save as otherwise provided or unless the context otherwise requires”.

The second recital to the lease records that:

“The Lessor is registered at H.M. Land Registry as proprietor with absolute freehold title of the Estate under Title Number NGL3222654 and has agreed to grant unto the Lessee a Lease of the demised premises at the premium and upon the terms hereinafter contained”

The Estate is defined in the First Schedule as:

“ALL THAT area of land shown for the purpose of identification only outlined in green on the attached plan marked “A” comprising land garden(s) flats garages parking spaces stores and premises known as Gascoyne Estate in the London Borough of Hackney”

The plan marked “A” attached to the lease covers an area of the Borough of Hackney which, it is agreed, is considerably smaller than the area containing the whole of the Gascoyne Estate (the registered title of which is spread over six separate plans, none of which is Plan A). Plan A is a detailed plan, based on the Ordnance Survey, which is centred on The Points, round whose curtilage a solid coloured line has been drawn. The colour appears to be blue on the copy I was shown but I presume it was green in the original. At the foot of the plan are printed the words “5 Hensley Point, Gascoyne Estate, London E.9.” and “prepared for the London Borough of Hackney” with the words “(1st Floor)” and “Plan A” added in manuscript.

Because of its extent, it would not have been possible to depict the whole of the Gascoyne Estate on Plan A. But some additional parts of the Gascoyne Estate are shown on the plan, lying to the east and northeast of The Points. Heavy black lines have been drawn around three sides of these areas but these have not been coloured (the sides which are not marked by a heavy line are at the edge of the plan). Similar heavy black lines also surround The Points, over which the blue coloured line has been added. The impression I formed looking at Plan was that a plan showing one corner of the Gascoyne Estate marked by a heavy black line had been used as the base plan, onto which a blue line had been drawn around The Points.

Although it was suggested by Mr Paget in the course of argument that the heavy lines around other parts of the Gascoyne Estate shown on Plan A were also coloured, the digital copy of the original lease held by the Land Registry was inspected after the hearing of the appeal and it is now common ground that the only coloured lines on Plan A are drawn around The Points.

The Block is defined in the Second Schedule as:

“ALL THAT piece or parcel of land being part of the Estate and known as 1-40 Hensley Point in the London Borough of Hackney”

Finally, the Reserved Property is defined at some length in the Third Schedule. It comprises four elements. The first includes forecourts, fences, staircases, landings, passages and other parts of the Block used in common by the owners or occupiers of any of the flats in the Block. The second comprises the main structural parts of the Block including the roofs, foundations, external walls etc, together with “all the cisterns tanks central heating apparatus (if any) sewers drains gutters pipes wires cables ducts and conduits not used solely for the purpose of the demised premises” (i.e. Flat 5). The third element of the Reserved Property is any flat in the Block for the time being not sold or let on a long lease of more than twenty-one years. Finally, the Reserved Property includes “all other parts of the Estate other than the Block and other Blocks on the Estate”. Although it might be open to an alternative construction, Mr Paget confirmed that the Council’s understanding was that no block on the Estate was part of the Reserved Property.

It is also relevant to notice that the Council covenanted by clause 7(B), (C) and (D) that it would only grant leases of other flats in the Block or elsewhere on the Estate on terms similar to those contained in the lease, that it would enforce those terms (including as to payment of the Management Charges), and that while any flat was not let under a lease in the same terms it would make such payments as would have been made by the lessee if the flat had been so let.