Blackhorse Investments (Borough) Limited v The Mayor and Burgesses of the London Borough of Southwark

The Tribunal’s power under rule 54 to set aside a final decision arises only where one of the specified procedural conditions is satisfied and it is in the interests of justice to do so. Proper service is not defeated because documents fail to reach the intended officer within an appropriate administrative address. Section 84 of the Law of Property Act 1925 permits modification of restrictions as to use or building, but not a covenant concerned only with alienation or a positive covenant. A positive keep-open obligation remains outside the jurisdiction even if it indirectly restricts other uses. An order made without jurisdiction is ineffective to that extent and should be set aside and remade only so far as necessary.

The Tribunal had previously modified leasehold covenants affecting a public house without a hearing because Southwark, the freehold owner and landlord, had not filed an objection. Southwark later applied under rule 54 of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010 to set aside the order, alleging ineffective service, misleading information, incoherent drafting and lack of jurisdiction.

The application concerned modifications permitting alterations, separate letting, changes of use and removal or alteration of obligations to keep the premises open and obtain licences. The central issues were whether the rule 54 threshold was met and whether section 84 jurisdiction extended to the alienation covenant and the positive obligations in the keep-open and licensing covenants.

1. Rule 54 threshold. The power to set aside a decision finally disposing of proceedings was available only if one of the conditions in rule 54(2) was satisfied, followed by a decision whether setting aside was in the interests of justice. The CPR authorities on varying or revoking orders could not be transferred uncritically to the Tribunal’s distinct rule.
2. Service and alleged procedural irregularity. Delivery by hand to Southwark’s principal administrative office, which was also the address in the proprietorship register, was effective service. The fact that the documents did not reach the intended officer did not establish a rule 54(2) condition. The application’s pleaded case and selective quotation of the covenants did not mislead the Tribunal or create an actionable procedural irregularity.
3. Section 84 jurisdiction. Section 84(12) extended the jurisdiction to qualifying leasehold land only in respect of restrictions as to use or building. The covenant prohibiting assignment of part of the premises was concerned with alienation, not use, and fell outside the jurisdiction. The Tribunal declined to decide more generally whether a restriction on subdivision might be different.
4. Positive covenants. The opening words of the keep-open covenant, restricting use to a licensed victualling house, were negative and within jurisdiction. The obligations to keep the premises open, conduct the pub business, preserve its character and obtain licences were positive and outside section 84. Their indirect restriction of other uses did not change their character.
5. Relief. The original order was set aside only to the extent that it exceeded jurisdiction. The alienation and licensing covenants remained unmodified, the alterations covenant remained modified, and the keep-open covenant was remade in the limited form stated at paragraph 83. The invalid parts were ineffective and did not require the whole order to be set aside.

First-instance application to the Upper Tribunal (Lands Chamber) under rule 54 of the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010. The Tribunal’s earlier order of 24 February 2022 was set aside and remade in part.