English Rose Estates Limited v Praveen Menon and Pradeep Menon & Ors.

A tribunal may raise a new point of law arising from uncontested facts, but it must consider carefully whether doing so threatens actual or apparent procedural fairness. An appellate challenge to case-management decisions succeeds only where the tribunal ignored a relevant factor, considered an irrelevant factor, or reached a plainly wrong decision.

Corrective construction is available only where it is clear that the language contains a mistake and what the parties intended to say is clear. It does not permit the court to reallocate contractual responsibilities or rewrite a bargain merely because the result is surprising or imprudent.

The landlord appealed against a decision of the First-tier Tribunal (Property Chamber) concerning service charges for nine residential leases. At the hearing, the leaseholders raised a new argument that their leases did not require them to contribute towards insurance premiums. The FTT permitted the point, refused an adjournment, and later disallowed approximately £40,000 of premiums.

The FTT also rejected an implied term and an estoppel by convention. On appeal, the landlord challenged the procedural decisions and argued that the leases should be corrected by construction so that insurance costs were recoverable. The central issues were whether the FTT had acted unfairly and whether the alleged drafting error justified corrective construction.

1. Procedural fairness. The appeal against the FTT’s case-management decisions was dismissed. An appellate tribunal must respect robust and fair case-management decisions unless the first-instance tribunal failed to consider a relevant factor, considered an irrelevant factor, or reached a plainly wrong conclusion. The importance of the point to the outcome does not alter that approach.
2. The FTT was entitled to permit the new legal point. A tribunal may raise a point of law arising from uncontested facts or evidence, but it must consider the consequences for the hearing and preserve both the reality and appearance of independence. Here, the parties were represented, the issue concerned construction of the leases, and the FTT provided an opportunity for further written submissions.
3. Rules 31 and 32 of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 did not require every issue to be determined exclusively through oral submissions at a hearing preceded by separate notice. The overriding objective permitted procedural flexibility and avoidance of delay, provided that the parties were treated fairly.
4. The refusal to adjourn did not cause unfairness. The issue could be resolved by legal argument, no further evidence was shown to be necessary, and the landlord accepted the FTT’s conclusions on the lease and estoppel. The written-submission safeguard was sufficient.
5. Corrective construction. The principle described in Chartbrook Ltd v Persimmon Homes Ltd & Ors and explained in Monsolar IQ Ltd v Woden Park Ltd requires both an obvious mistake and a clear answer to what the document was intended to say. It is distinct from choosing between rival interpretations.
6. The alleged error was not a linguistic, arithmetical or drafting slip. It concerned the allocation of responsibility for insurance costs, and more than one method of recovery was possible. Correcting the lease as proposed would therefore rewrite the parties’ bargain. The appeal was dismissed.

• First-tier Tribunal (Property Chamber): On 11 March 2022, determined that the insurance premiums were not payable under the leases and disallowed approximately £40,000.
• Upper Tribunal (Lands Chamber): Appeal dismissed on all three grounds.