Point West GR Ltd v Bassi & Ors

A review by the First-tier Tribunal under section 9 of the Tribunals, Courts and Enforcement Act 2007 concerns a decision on a particular matter, not an unrestricted reconsideration of the whole case. The tribunal must define the review’s scope, and any expansion must be clearly notified to the parties. Review may correct a clear error of law and permit the affected matter to be re-decided, but it cannot introduce a new free-standing point, reopen unchallenged questions of quantum, or undermine finality. The Upper Tribunal must respect the scope of the FTT’s review. A service-charge determination under the Landlord and Tenant Act 1985 removes a statutory cap on contractual liability; it does not itself create liability.

Leaseholders challenged service charges relating to a large mixed-use building. The FTT’s original decision allowed a management charge, notional office rent and professional disbursements, but its reasoning concerning administrators’ fees appeared to permit double recovery. Following an application for permission to appeal, the FTT reviewed that part of its decision and instead held that the new landlord lacked contractual liability for the relevant sums. The Upper Tribunal, in [2019] UKUT 137 (LC), rejected that contractual-liability reasoning and also treated the original findings on quantum and section 20B of the Landlord and Tenant Act 1985 as open for reconsideration. The central issue before the Court of Appeal was the proper scope and effect of the FTT review.

Lord Justice Lewison gave the leading judgment. Lord Justice Floyd and Lord Justice Peter Jackson agreed. The appeal was allowed.

1. Section 9 of the Tribunals, Courts and Enforcement Act 2007 gives the FTT power to review a decision on a matter in a case. That does not authorise a general rehearing. The FTT itself determines the scope of the review, and the parties cannot convert it into a free-for-all.
2. The scope is initially fixed by the FTT’s decision to review. If the FTT expands that scope, fairness requires it to identify clearly which parts of the original decision may be set aside. Where formal statements of case are directed, the issues will normally be confined to those statements; arguments omitted from them may be treated as abandoned or superseded.
3. The review power is principally designed to avoid an unnecessary appeal where the FTT has made a clear error of law. It must not enable the FTT to usurp the Upper Tribunal’s appellate function or revisit a tenable view of the law. Errors of law may include factual conclusions unsupported by evidence, conclusions contrary to the only reasonable view of the evidence, a material breach of natural justice, or decision-making on an incorrect factual basis. Section 9(8) does not give the FTT carte blanche to reopen all factual findings. After setting aside the relevant decision, however, the FTT may re-decide that matter on different grounds.
4. The FTT should not have entertained the leaseholders’ new, free-standing contractual-liability point. It was not a ground of appeal, was not consequential on reviewing the identified issue, and could open a new area of evidential inquiry. Finality is part of dealing with cases fairly and justly. Even if the new point had been permissible, it did not reopen the separate findings on quantum.
5. Because the FTT had not reviewed quantum, the Upper Tribunal was not entitled to reconsider it on an appeal from the review decision. Its assessment of reasonableness on the papers, without giving the landlord an opportunity to call relevant evidence relied on before the FTT, was procedurally irregular. The section 20B issue was outside the review and could not properly be considered by the Upper Tribunal. The Court expressed no view on its substantive correctness; the Upper Tribunal’s reasoning on that issue therefore had persuasive but no precedential value.
6. The original FTT findings on the reasonableness of the notional rent, disbursements and management charge, together with its decision on section 20B, were reinstated.

• Court of Appeal (Civil Division): appeal from the Upper Tribunal allowed. The original FTT findings on quantum and section 20B were reinstated.
• Upper Tribunal (Lands Chamber): decision at [2019] UKUT 137 (LC). It rejected the FTT’s contractual-liability reasoning but treated the original quantum findings and section 20B issue as open to consideration.
• First-tier Tribunal: original decision dated 15 August 2016, followed by a review decision dated 23 January 2018.