Di Marco v Morshead Mansions Ltd

A tenant may directly enforce a landlord’s statutory duties to provide service-charge information where the statutory scheme protects a defined class of tenants and civil relief is an effective means of achieving Parliament’s purpose. A criminal sanction does not necessarily exclude a civil remedy.

A tribunal with exclusive statutory jurisdiction to appoint a manager retains that exclusivity where the tenant has already applied unsuccessfully. A negative declaration may be available to clarify a genuinely disputed debt, provided the claimant has a legitimate interest and the issue is properly pleaded.

The defendant, a long-leaseholder and shareholder in the claimant freehold company, appealed against the striking out of his counterclaims in two related proceedings. The counterclaims concerned service-charge information, consultation, the legal status of historic demands, the use of funds raised under the company’s articles, and the appointment of a manager.

The first-instance judge had struck out the counterclaims, holding among other things that sections 21 and 22 of the Landlord and Tenant Act 1985 created no directly enforceable civil duty, that a claim concerning 2007 works was barred by estoppel or abuse of process, and that the court lacked jurisdiction to appoint a manager.

1. Service-charge information. The appeal succeeded on the claim for information under sections 21 and 22 of the Landlord and Tenant Act 1985. Those provisions imposed duties owed to tenants with qualifying tenancies. They protected a defined class whose members needed the information to check whether service charges were properly calculated. The criminal sanction in section 25 did not show that criminal proceedings were the exclusive remedy. Injunctive relief was more directly suited to securing production of the information.
2. The governing question was Parliament’s intention, assessed by considering the statute as a whole and the relevant statutory scheme. The factors identified in Digicel (St Lucia) Ltd v Cable and Wireless plc [2010] EWHC 774 assisted that inquiry. Lonrho Ltd v Shell Petroleum Co Ltd (No 2) [1982] AC 173 did not require a different result, and Taber v MacDonald (1998) 31 HLR 73 concerned a different issue.
3. 2007 works. The challenge to the 2007 works had already been dealt with by the Leasehold Valuation Tribunal. The Tribunal had jurisdiction to determine whether the sums were service charges, and its decision prevented the issue being raised again by estoppel or, alternatively, as an abuse of process. The appeal therefore failed on that ground.
4. 2003 debt. The proposed claim concerning a possible 2003 service-charge debt was not purely academic because the company declined to abandon the potential liability. A negative declaration could be appropriate where a debtor had a legitimate interest in clarifying a disputed debt and the creditor had not commenced proceedings. The claim nevertheless required proper particularisation.
5. Appointment of a manager. Section 21(6) of the Landlord and Tenant Act 1987 excluded the court’s jurisdiction where the circumstances fell within section 24 and an application could be made to the Tribunal. The Tribunal’s refusal to appoint a manager did not transfer jurisdiction to the court. Stylli v Haberton Properties Ltd [2002] EWHC 394 (Ch) supported that conclusion.
6. The appeal succeeded to a limited extent. The information claims were reinstated, subject to further directions. The claim concerning the 2003 debt could be resurrected or re-pleaded. The remaining grounds failed.

• High Court (Chancery Division): Appeal from the decision of HH Judge Hand QC dated 20 July 2012. The appeal was allowed in part.