Solomon Unsdorfer v Octagon Overseas Limited & Ors

A tribunal-appointed manager under section 24 of the Landlord and Tenant Act 1987 is not an accountable person under Part 4 of the Building Safety Act 2022. A manager’s obligations arise from the management order, not under a lease or by virtue of an enactment.

However, a management order made before Part 4 commenced continues to bind the manager. The manager must continue performing any building-safety functions already conferred by that order, even though the landlord or other estate owner is separately an accountable person. A new or varied section 24 order cannot confer functions which Part 4 requires an accountable person to perform.

The appellant was appointed by the First-tier Tribunal under section 24 of the Landlord and Tenant Act 1987 to manage parts of the Canary Riverside Estate, including five higher-risk buildings.

The landlords applied under section 75 of the Building Safety Act 2022 for determinations identifying the accountable persons. The FTT held as a preliminary issue that the manager could not be an accountable person under section 72(1)(b), and identified the relevant landlords and leaseholders as accountable persons. The manager appealed.

The central issues were whether the manager’s repairing obligations were imposed under a lease or by virtue of an enactment, and what effect Part 4 had on pre-existing management orders.

1. The appeal was dismissed. The manager did not hold a legal estate in the common parts, so section 72(1)(a) of the Building Safety Act 2022 did not apply.
2. Under section 72(1)(b) and section 72(6), a relevant repairing obligation must require repair or maintenance under a lease or by virtue of an enactment. The manager’s obligations were imposed by the FTT’s management order. They were not obligations under a lease.
3. The expression “by virtue of an enactment” referred principally to repairing obligations imposed directly by statute, such as those implied into leases by section 11 of the Landlord and Tenant Act 1985. A tribunal order was not an enactment. The position differed from that of an RTM company, whose obligations arose directly from statute.
4. Parliament had not created an additional exception from section 72(1) for tribunal-appointed managers. Accordingly, the estate owner remained an accountable person even where a section 24 manager was already in place.
5. Section 24(2E) of the Landlord and Tenant Act 1987 applied to new or modified orders. It did not retrospectively rewrite existing management orders. Paragraph 8(2) of Schedule 7 to the 2022 Act confirmed that pre-existing orders could continue to contain functions which might later be transferred to a special measures manager.
6. Consequently, a pre-existing manager remained bound to perform functions conferred by the existing order, including overlapping building-safety functions. The manager did not thereby become an accountable person and was not required to perform Part 4 duties which the order had not conferred.
7. On expiry, variation or replacement of the order, the FTT could not confer on the manager functions which Part 4 required an accountable person to perform. Parties could apply to the FTT to modify or discharge the order to remove duplication. The Tribunal recognised a temporary and potentially uncomfortable overlap between the manager’s functions and the landlord’s statutory duties.

• First-tier Tribunal (Property Chamber): on 21 December 2023, determined that a tribunal-appointed manager could not be an accountable person under section 72 of the Building Safety Act 2022, and identified the relevant accountable persons.
• Upper Tribunal (Lands Chamber): dismissed the manager’s appeal. The FTT’s conclusion was upheld, although part of its reasoning concerning the effect of section 24(2E) on existing orders was rejected.