Robert Vernon v Orbit Housing Association

An issue estoppel arising from an earlier service-charge determination does not prevent a tribunal from making findings about later service-charge years where the earlier decision determined only the facts existing during the earlier periods. The estoppel must be confined to an issue essential to the earlier decision. A finding that no services were provided in particular years is not a finding that services can never be provided in future years. Where an earlier decision was plainly wrong and it would be inequitable to bind the parties to it for the duration of a tenancy, the tribunal may also apply the recognised exception to issue estoppel.

The appellant, a tenant of sheltered accommodation, challenged variable Scheme Based Support Charges demanded by the respondent housing association. In 2022 the First-tier Tribunal found that no relevant services had been provided to him in the service-charge years 2021/22 and 2022/23, and held that the charges were not reasonably incurred. The Upper Tribunal upheld that decision in Orbit Housing Association Limited v Vernon [2023] UKUT 156 (LC).

For later years, the First-tier Tribunal received contractual documents, service records and witness evidence showing that overnight emergency and support services were provided for all residents. It found the charges reasonable and payable. The central issue was whether the earlier findings created an issue estoppel preventing that conclusion.

1. Appeal dismissed. The finding that the Scheme Based Support Charge was reasonable and payable for 2023/24 and 2024/25 stood.
2. Issue estoppel applies only to an issue necessarily determined in the earlier proceedings. The 2022 First-tier Tribunal decision was based on evidence about what services were actually provided in 2021/22 and 2022/23. It did not decide that services could never be provided to the appellant, nor did it determine the contractual terms governing the overnight-care provider.
3. The earlier decision therefore concerned the facts on the ground during specified service-charge years. It did not prevent the First-tier Tribunal from reaching a different factual conclusion for later years, particularly where it had materially fuller evidence, including the agreement with the planning authority, the provider’s contract, work records and detailed witness evidence.
4. The earlier tribunal had found that no services were provided, rather than that services were available but conferred no benefit. That distinction was material. The later tribunal was entitled to find that services were provided for all residents, whether or not the appellant wanted or used them, and that the cost was reasonable.
5. Alternatively, if the earlier decision had created an estoppel of wider scope, the exception recognised in Arnold v National Westminster Bank plc [1991] 2 AC 93 and applied in Hemmise v London Borough of Tower Hamlets [2016] UKUT 109 (LC) would permit the later decision. The earlier conclusion was plainly wrong on the fuller evidence, and it would be inequitable to bind the landlord to it for the potentially long duration of the tenancy.
6. No issue estoppel arose from the 2022 decision. The appeal accordingly failed.

• Upper Tribunal (Lands Chamber): appeal from the First-tier Tribunal dismissed; the later service charges were reasonable and payable.
• First-tier Tribunal (Property Chamber): in 2022, charges for 2021/22 and 2022/23 were held not payable; in April 2025, charges for 2023/24 and 2024/25 were held reasonable and payable.