Anthony Orchard & Anor v Alison Mooney

An order authorising an appointed manager to demand an additional service charge is a variation of the management order under section 24(9) of the Landlord and Tenant Act 1987, not a direction under section 24(4) or a litigation costs order. The label “interim order” does not alter its legal effect where it is a continuing authorisation.

In deciding whether to vary a management order, the tribunal may act swiftly where urgency justifies it, provided that the parties have an adequate opportunity to respond. It does not err by failing to consider alleged hardship or other matters which were not raised before it. Leaseholders retain the right to challenge the reasonableness of service-charge expenditure.

Anthony Orchard & Anor v Alison Mooney was an appeal from a First-tier Tribunal order dated 18 August 2020. The First-tier Tribunal had previously appointed the respondent as manager of a three-flat building under section 24(1) of the Landlord and Tenant Act 1987.

At the manager’s request, the First-tier Tribunal authorised an additional interim service-charge demand of £15,000 to fund legal representation in proceedings concerning access and water ingress. The appellants challenged the tribunal’s jurisdiction, the description and clarity of its order, the procedure adopted, and the exercise of its discretion. The central issue was whether the order was within the tribunal’s power and, if so, whether it should be set aside.

1. Appeal dismissed. The First-tier Tribunal had jurisdiction to make the order. Properly characterised, it varied the existing management order under section 24(9) of the Landlord and Tenant Act 1987 by giving the manager an additional power to demand a service charge.

2. The order was not a direction under section 24(4), because it conferred an additional power. Nor was it a costs order between litigants. It authorised a demand from leaseholders, whose reasonableness could subsequently be challenged.

3. The description “interim order” was unhelpful but immaterial. The order was a once-and-for-all authorisation, subject to appeal and to any later challenge to the reasonableness of expenditure. Section 24 did not provide for a true interim order, but the label did not create a jurisdictional or procedural defect.

4. Section 24(9A) did not apply. It concerns variation or discharge on an application by a relevant person to whom an initial notice under section 22 was addressed; that was not the basis of this application.

5. The swift and informal procedure caused no substantial procedural defect. It was appropriate in light of the approaching hearing, and the appellants had an opportunity to make representations. The First-tier Tribunal could not be criticised for failing to consider financial hardship or an effect on the appellants’ representation where those matters had not been put before it.

6. The First-tier Tribunal acted within its discretion. It was entitled to regard resolution of the access and water-ingress issue as urgent and important. It was not confined by the leases when granting powers to an appointed manager, and the appellants’ concerns about expenditure could be addressed through a reasonableness challenge or an application for the manager’s removal.

• Upper Tribunal (Lands Chamber): dismissed the appeal from the First-tier Tribunal’s order of 18 August 2020 varying the management order.
• First-tier Tribunal: appointed the respondent manager on 18 February 2019 under section 24(1) of the Landlord and Tenant Act 1987; on 18 August 2020 it authorised an additional service-charge demand of £15,000.