Gholam Hossein Behjat v Crescent Trustees Limited

Concurrent deployment of a judge does not merge the jurisdictions of the county court and the First-tier Tribunal. A tribunal judge may make a county court order only when sitting as a county court judge in proceedings governed by the CPR. The First-tier Tribunal cannot use its own procedural rules to strike out a county court claim.

A tribunal order which purported to do so was affected by a procedural irregularity and could be set aside under rule 51 where that was in the interests of justice. Before setting aside its own decisions on its own initiative, however, the Tribunal should obtain the parties’ representations and explain the legal power on which it acts.

The landlord brought a county court claim for service charges. The tenant challenged their reasonableness and payability, and the relevant issue was transferred to the First-tier Tribunal under section 176A of the Commonhold and Leasehold Reform Act 2002.

FTT directions purported to provide for concurrent county court and tribunal decision-making. After the landlord failed to comply with a direction concerning county court pleadings, an FTT judge, sitting under the FTT Rules, struck out the landlord’s application. A later FTT order set aside that decision and a refusal of relief from sanctions, but did not identify the power used or invite representations.

The tenant appealed the later order and consequential directions. The central issue was whether the FTT could set aside the earlier decisions and whether the original strike-out had affected the county court claim.

1. The appeal succeeded to a limited extent. The order communicated on 30 September 2021 objectively set aside the orders of 16 and 28 September 2021, despite the judge’s later explanation that those orders had merely been treated as nullities. The consequential directions dated 29 September 2021 were also set aside.

2. The order of 16 August had purported to strike out the county court action. Its substance, context and request for submissions on a county court order showed that it was intended to end that action, rather than merely regulate the transferred service-charge issue. An FTT judge sitting under the FTT Rules had no jurisdiction to make that order. Concurrent deployment did not alter the separate jurisdictions or procedural regimes of the two bodies. This applied the warning in Avon Ground Rents Limited v Child [2018] UKUT 204 (LC).

3. The 30 September order correctly identified the jurisdictional defect, but its reasoning did not identify how the FTT had power to set aside the earlier decisions. It could not have been a review under rule 55 because no application for permission to appeal had been made. It could potentially have been made under rule 51, but the Tribunal should first have sought the parties’ representations. The unexplained exercise of power and the unfair procedure required the order to be set aside.

4. The Upper Tribunal re-made the decision under rule 51 of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013. It set aside the 16 August decision because an FTT judge had purported, in that capacity, to strike out a county court case. That procedural irregularity and the interests of justice justified relief. The FTT could now determine service-charge payability, while the county court claim was to continue under the CPR before a judge acting in the proper capacity.

• Upper Tribunal (Lands Chamber): allowed the appeal to the extent of setting aside the FTT’s order of 30 September 2021 and consequential directions, then re-made the decision under rule 51 of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013.

• First-tier Tribunal (Property Chamber): an order of 16 August 2021 purported to strike out the county court claim; relief from sanctions was refused on 28 September 2021; on 30 September 2021 the FTT purported to set aside both decisions.

• County Court: the service-charge claim was transferred on 25 March 2021 under section 176A of the Commonhold and Leasehold Reform Act 2002 for determination of recoverability and payability.