Manaquel Company Limited v London Borough of Lambeth

An appeal against an improvement notice under Schedule 1 to the Housing Act 2004 is a re-hearing of whether the local housing authority’s decision was wrong when made. The tribunal may consider material unknown to the authority, but only where it bears on the correctness of that earlier decision. Later works or a changed current position do not invalidate the original notice.

The identical appeal formula used throughout the Act must be construed consistently. An unappealed decision quashing a notice does not prevent the authority, in a subsequent costs application, from showing that criticisms of its conduct rest on an erroneous view of the legally relevant issues.

Lambeth served Manaquel, the freeholder of a 96-flat estate, with an improvement notice under sections 11 and 12 of the Housing Act 2004. Manaquel appealed to the First-tier Tribunal. Both parties proceeded on the basis that the notice’s validity fell to be assessed at the hearing date. The FTT quashed the notice and later refused Manaquel’s application for costs under rule 13(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013.

The Upper Tribunal, in [2025] UKUT 97 (LC), held that the FTT had applied the wrong date but declined to set aside the costs decision. Manaquel appealed. The central issues were the correct assessment date for an appeal against an improvement notice and whether the unappealed substantive decision prevented reliance on the correct legal analysis in determining costs.

1. Appeal dismissed. The Court held that Schedule 1 paragraph 15(2) of the Housing Act 2004 requires the FTT to decide whether the local housing authority was wrong to serve the improvement notice when it did. The appeal is a re-hearing, but the express permission to consider matters unknown to the authority does not permit a fresh decision based on circumstances existing at the tribunal hearing.

2. The Court followed Hussain (Nasim) v Waltham Forest London Borough Council [2023] EWCA (Civ) 733. The same statutory formulation appears repeatedly in the Act for appeals against housing-enforcement, licensing and related decisions. Parliament therefore intended a consistent appellate function. Later works may be relevant only if they demonstrate that the authority’s original decision was wrong when made; they cannot themselves undermine its validity.

3. The Court did not determine any general issue about the degree of deference owed to a local authority. The Upper Tribunal had decided only the date issue, and the appeal raised no discrete deference question requiring determination.

4. The unappealed FTT decision quashing the notice bound Lambeth as to that result. It did not create a res judicata on the distinct Rule 13 question whether Lambeth had acted unreasonably in bringing, defending or conducting the proceedings. On a costs application, Lambeth could rely on the correct legal analysis to show that criticisms founded on the later condition of the estate were misdirected.

5. The Upper Tribunal had a discretion under section 12(2)(a) of the Tribunals, Courts and Enforcement Act 2007 not to set aside the flawed costs decision. No independent challenge to that exercise of discretion was advanced. The Court therefore upheld the refusal to disturb the FTT’s refusal of costs.

• Court of Appeal (Civil Division) — dismissed Manaquel’s appeal and upheld the Upper Tribunal’s conclusion on the correct assessment date and its decision not to disturb the costs ruling: [2026] EWCA Civ 972 .

• Upper Tribunal (Lands Chamber) — dismissed Manaquel’s appeal against the refusal of costs. It held that the FTT had misdirected itself by assessing the notice at the hearing date, but exercised its discretion not to set aside the costs decision: [2025] UKUT 97 (LC) .

• First-tier Tribunal (Property Chamber) — quashed the improvement notice on 17 November 2023 and, on 16 May 2024, refused Manaquel’s Rule 13 costs application.