Aldford House Freehold Ltd v Grosvenor (Mayfair) Estate & Anor

For the purposes of collective enfranchisement, premises may be a “flat” even though they are not yet fit for habitation. The question is whether an identifiable, separate set of premises has been constructed or adapted for use as a dwelling. Separate physical identity, functional separation and the terms of the relevant leases may be material.

An application under section 22 of the Leasehold Reform, Housing and Urban Development Act 1993 must be capable of relating to the particular initial notice relied upon. A claim form referring only to one of two notices cannot preserve the other notice from deemed withdrawal. An unauthorised initial notice cannot subsequently be validated by ratification where the statutory scheme makes validity depend on the position when the notice was given.

The claimant, as nominee purchaser, sought a declaration that participating tenants were entitled to acquire the freehold of Aldford House under Chapter 1 of Part I of the Leasehold Reform, Housing and Urban Development Act 1993.

Two initial notices were served on the same day. The principal disputes concerned whether four shell units on the sixth and seventh floors were “flats”, whether the notices had been authorised by all signatories, whether certain tenants were qualifying tenants, whether the building exceeded the statutory commercial-space threshold, and whether the claimant’s application related to the second notice.

The court also considered procedural objections to late evidence and a late allegation that overriding underleases had been unlawfully granted.

1. Flats. Each of flats 61, 62, 71 and 72 was a separate set of premises. The dividing wall, locked access doors, separate access, separate underleases and intended removal of the doors established physical and functional separation. The test stated in Cadogan v McGirk [1996] 4 All ER 643 and applied in Merie Bin Mahfouz (UK) Limited v Barrie House (Freehold) Limited [2015] L&TR 21 was applied.
2. The units had been constructed for residential purposes although they remained unfitted shells. The reasoning in Boss Holdings Limited v Grosvenor West End Properties Limited [2008] UKHL 5; [2008] 1 WLR 289 was applied. Day v Hosebay Limited [2012] UKSC 41; [2012] 1 WLR 2884 concerned change of use and did not require a different result.
3. There were therefore thirty flats. The Initial Notice was void because it omitted the tenants of the four additional flats, applying Natt v Osman [2015] 1 WLR 1536.
4. The claim form was properly understood as relying only on the Initial Notice. It was not an application capable of relating to the Second Notice, which was deemed withdrawn under section 29.
5. Ratification could not validate the notices retrospectively. The statutory timetable and immediate proprietary effects of an initial notice required validity when given. The rule in Doe d. Mann v Walters (1830) 10 B & C 626, as explained in Presentaciones Musicales S.A. v Secunda [1994] Ch 271, was applicable.
6. The claim was dismissed. Further issues were addressed only provisionally. The late unlawfulness allegation concerning overriding underleases was not admitted for determination, and no conclusion was reached on its substantive merits.