[2025] UKUT 136 (LC)

According to the Building Owner’s notice of appeal, the appeal is against the FTT’s decision of 24 July to impose an agreement providing for only nominal consideration for the interim rights conferred on CTIL, but in substance the first ground of appeal focusses on the prior case management decision of 24 June to refuse to permit the Building Owner to rely on expert evidence. The Building Owner’s original application for permission to appeal the procedural judge’s case management decision was considered by the FTT and dismissed at the start of the hearing on 16 July, with reasons for the dismissal being given as part of the substantive decision on 24 July.

When it considers an application for permission to appeal the FTT is required by rule 53 of its procedural rules to first consider whether to review the decision in accordance with rule 55 and, before refusing permission, the FTT stated specifically that it had decided not to review its decision.

A decision not to review an earlier decision is an “excluded decision” against which there is no right of appeal (section 11(1) and 11(5)(d), Tribunals, Courts and Enforcement Act 2007). That is important in this case because in considering whether to review the decision of 24 June the FTT gave much fuller consideration to the question whether expert evidence should be permitted than had the procedural judge. But the case management decision had already been taken, and it is clear that it was not taken again on 16 July; all the FTT then did was to consider whether to review the case management decision, or whether to grant permission to appeal. It is not known whether the procedural judge was also the judge at the substantive hearing and it cannot be assumed that the considerations taken into account on 16 July were in the procedural judge’s mind on 24 June.

When the Building Owner applied for permission to appeal it specified the decision under appeal as the decision of 24 July, and it was for that appeal that this Tribunal granted permission. But to the extent that it concerned the refusal to permit expert evidence, that decision was an excluded decision which cannot be appealed. In form and substance, it was no more than a refusal to review the earlier case management decision. For the avoidance of any uncertainty, I additionally now grant permission to appeal the decision of 24 June.

It is an important principle that case management decisions should not be interfered with by an appellate court if made by a judge who has:

But the decision maker must have “applied the correct principles”. If a tribunal misdirected itself on some relevant legal principle, an appellate tribunal will be much readier to reconsider its decision. In those circumstances the decision maker will have had regard to an irrelevant consideration, and will have overlooked a relevant consideration, so its case management discretion will have been exercised on a flawed basis.

The case management decision of 24 June described the application for permission to rely on expert evidence as “misconceived” because “this is an application for an MSV only” and because decisions of this Tribunal and of the FTT had “consistently made nominal orders for consideration” in cases involving rights to carry out an MSV survey.

Mr Holland KC submitted that the case management decision was based on a misdirection and Mr Radley-Gardner KC did not dissent from that proposition, with which I agree.

The description of the application as “misconceived” suggests that it was the understanding of the procedural judge that the application to permit expert evidence was unarguable. The explanation that the application was “for an MSV only” suggests that there was thought to be a principle of law, or an inflexible practice, which prevents an award of more than nominal consideration in such a case.

As I have explained, paragraph 26(6)(b) of the Code makes the inclusion of a term for the payment of consideration a matter of discretion. But if there is a dispute, the FTT must decide how to exercise that discretion and in doing so it must take all relevant matters into account. One relevant matter would obviously be if, in an open market, willing parties would agree an amount of consideration which was more than nominal. Whether they would do so is a question of valuation on which expert evidence is admissible. There is therefore no principle that expert evidence cannot be relied on in an interim rights claim concerning an MSV.

As for consistency of practice, this Tribunal has never been required to determine a dispute over the consideration payable for interim rights to conduct an MSV. Interim rights cannot be conferred by agreement and may only be imposed on application; for a number of years after the introduction of the Code in 2017 applications were determined by this Tribunal. Many orders were made imposing interim rights, including a number after contested hearings, but as far as I am aware there has never previously been a dispute over the amount which should be paid as consideration for an MSV agreement. In the very great majority of cases the parties have agreed that the consideration to be included in the agreement should be nominal only, typically £1. Sometimes more substantial figures may have been agreed, although I suspect where this happened it may have been in lieu of compensation, but in no case was the Tribunal called on to determine a dispute.

The primary jurisdiction to determine applications under the Code is now with the FTT and I understand the same general pattern has continued and that there has been no determination of a contested case where consideration was in issue.

Tribunals are not party to the negotiations which lead litigants to reach agreements, but it is not difficult to think of reasons why nominal consideration should routinely be agreed for MSV rights. The rights themselves are insubstantial and permit a small number of vetted surveyors or other technical experts to have access to a rooftop or service areas of a building for a few hours at a time on what, in practice, are usually two or three occasions. Destructive investigations are not normally permitted (where provision is sometimes made for them it is on the basis that full reinstatement will be achieved). The rights are exercisable during a limited period, usually of six months. Building owners are entitled to compensation for any loss or damage caused by the exercise of the rights. Where a substantial building is involved, agreements will typically include the payment of fees to the building owner to cover the cost of approving risk assessments and the credentials of contractors, attendance during the surveys, providing an escort round the building, and providing plans or other documents or information required. When it is additionally remembered that the no-network assumption removes the commercial value of the rights to the operator as a relevant factor in the assessment of consideration, it is unsurprising that a nominal sum is routinely agreed. The alternative would be an expensive piece of litigation the costs of which would be likely to dwarf any sum awarded. Taking this case as an example, the Building Owner is said to have incurred costs of more than £50,000, excluding VAT, in the FTT proceedings in pursuit of consideration which its own advisers now put no higher than £10,000.

The willingness of most parties to reach agreement cannot provide grounds for prohibiting other parties who are not willing to accept the prevailing consensus from putting forward evidence in support of a different outcome. There is no decision of a tribunal, at either level, determining what consideration might be appropriate. If a site provider wishes to argue for substantial consideration it must be entitled to do so, and for so long as there is no pattern of decisions for the FTT to refer to as guidance, it should be allowed to rely on expert evidence in support of its case, unless there is a good reason not to permit it.

The FTT’s standard directions in interim rights cases (which in this respect mirror the directions previously used by this Tribunal) reflect this approach. A party who wishes to rely on expert evidence is required to apply for permission to adduce it. That is because it is incumbent on every court or tribunal to limit expert evidence to what is necessary, and because experience has shown that it is rarely necessary in interim rights cases. But the restriction in the standard directions is intended to control rather than to prohibit reliance on expert evidence and was included to check the preparation of lengthy and unfocussed reports at disproportionate expense. The directions do not spell out what is to happen if an application for permission to rely on expert evidence is made, because that will depend on the circumstances of the case and the stage at which the application is received. In an ideal case, at the time of making the application for permission the applicant will identify the expert they wished to instruct and provide a brief synopsis, prepared by the expert, of the evidence they intend to give. That will enable the FTT, and the other party, to consider a timetable for the production of the evidence and the form in which it should be permitted to be produced (i.e. whether in writing only, or by attendance at a hearing, and whether by simultaneous exchange or sequentially). In a less than ideal case, if an application is made too late for the production of expert evidence to be accommodated in the existing timetable, the application may be refused.

In short, the FTT’s refusal to permit reliance on expert evidence was not justified by the reasons it gave, which were based on a misunderstanding of law and practice and were procedurally irregular.