Sleaford House Tenants Association v Poplar Harca

This is an appeal from a refusal by the First-tier Tribunal to grant a certificate of recognition to a recognised tenants’ association (an “RTA”) on an application by the appellants. It has been decided under the Tribunal’s written representations procedure; neither party has been legally represented.

Section 29 of the Landlord and Tenant Act 1985 says this (so far as relevant):

“(1)

A recognised tenants' association is an association of qualifying tenants (whether with or without other tenants) which is recognised for the purposes of the provisions of this Act relating to service charges either—

(a)

by notice in writing given by the landlord to the secretary of the association, or

(b)

by a certificate—

(i)

in relation to dwellings in England, of the First-tier Tribunal;….

….

(4)

In this section … for the purposes of this section a number of tenants are qualifying tenants if each of them may be required under the terms of his lease to contribute to the same costs by the payment of a service charge.”

The 1985 Act goes on to make provisions about the role of an RTA, in particular in the context of consultation about major works under section 20 of the 1985 Act.

Section 29A makes provision for regulations to require landlords to provide information about their qualifying tenants, and adds a further definition:

“qualifying tenant” means a tenant who, under the terms of the lease, is required to contribute to the same costs as another tenant by the payment of a service charge.

On an application for a certificate under section 29(1)(b)(i) the FTT has a discretion; regulation 3 of the Tenants’ Associations (Regulations Relating to Recognition and Provision of Information) (England) Regulations 2018 sets out the matters the FTT has to consider in deciding whether to grant a certificate, including the association’s rules about decision-making and voting and “the extent to which the constitution of the tenants’ association takes account of the interests of all members”. Regulation 4 restricts the FTT’s discretion as follows:

“(1)

The First-tier Tribunal must not give a certificate to a tenants’ association in relation to a premises where the tenants’ association represents fewer than 50% of the qualifying tenants of dwellings situated in the premises.

(2)

But where—

(a)

the tenants’ association represents qualifying tenants in dwellings situated in related premises; and

(b)

those qualifying tenants contribute to the same costs by the payment of a service charge,

the First-tier Tribunal must not give a certificate to the tenants’ association in relation to the related premises if the tenants’ association represents an aggregate of fewer than 50% of the qualifying tenants of dwellings situated in the related premises.”

The Sleaford and Gayton Residents’ Association made an application to the FTT for a certificate under section 29(1)(b)(i). The copy of the application form provided to the Tribunal is undated, but it must have been in the autumn of 2024. The application was for the grant of a certificate for an association representing both Sleaford House and Gayton House, and it stated that each had 99 flats; the landlord was said to be the London Borough of Tower Hamlets. In the box on the application form which asked for the number of flats for which variable service charges were payable the applicant’s representative wrote “unsure”; the number of flats whose tenants were members of the association was said to be 22.

At some point in the proceedings the landlord was identified as Poplar HARCA (which stands for Poplar Housing and Regeneration Community), which is the respondent to this appeal.

On 29 November 2024 the application was refused; in a letter to the appellant, written on the instructions of a judge, the FTT acknowledged the application and “various correspondence”, and stated that because fewer than 50% of qualifying tenants were members of the appellant it was unable to grant a certificate in light of the prohibition in regulation 4(1) of the 2018 regulations (set out above).

The FTT refused permission to appeal; its decision stated that the applicant was the “Sleaford and Chilton House Residents’ Association.” The decision stated that a certificate could not be granted because fewer than 50% of the qualifying tenants were members of the association, “there being approximately 20% participation”.

An application for permission to appeal to the Tribunal was made by the appellant, “Sleaford House Tenants’ Association.” In its grounds of appeal it stated that it sought to appeal only in relation to Sleaford House, because the landlord required that there be separate associations for the two blocks, and it said that there were 39 “leaseholders in the building”. It provided a list of 28 long-leaseholder members with flats in Sleaford House. Permission to appeal was granted on the basis that if there were indeed 39 qualifying leaseholders and either 22 or 28 of them were members then either the FTT had not correctly applied the statutory requirements or it had not properly explained its decision.

Directions were given for the appellant to state clearly whether it now sought recognition as an RTA in relation to Sleaford House alone or in relation also to Gayton House, for the respondent to file and serve a statement of case, and for the appellant to reply.

The FTT has helpfully provided a copy of the original application to the FTT, since the appellant had not kept a copy; with it is a copy of what appears to be the constitution, or draft constitution, of the “Gayford and Sleaford Residents Association Constitution” and minutes of a meeting held in which a constitution was discussed and adopted; at the end of the minutes are the signatures of those attending, giving addresses in both blocks; the writing is indistinct but there seem to be 19 flats represented in Sleaford House and 12 in Gayton House. The application form states very clearly that the application is for a certificate for an RTA representing both blocks.

The respondent in its statement of case argues that it should not now be possible to amend the application in the appeal so as to represent one block only. As to the numbers of qualifying tenants, it asserts that 50 of the 99 flats in Sleaford House are held on long leases, and that tenants on short leases were also qualifying tenants: “Assured Tenants and leaseholders all pay service charges so are qualifying tenants.”

In response, the appellant confirms that in the appeal it seeks only a certificate in relation to Sleaford House and that since this change is made in response to the landlord’s preference for there to be separate associations for the two blocks it is “obstructive” for the landlord to object to that change of tack. It challenges the figure of 50 long leases; it now says that there are 39 “privately owned” long leasehold flats in Sleaford House. That figure, it says, has emerged from its own research at HM Land Registry, which reveals that there are 39 privately owned long leasehold flats, excluding those that are “held by local councils or private companies”. And it states that the statute defines as qualifying tenants “long leaseholders who are liable to contribute to service charges on an equal or proportionate basis”; it refers to guidance issued by the Leasehold Advisory Service, which states that “Recognised Tenants’ Associations are usually groups of long leaseholders, not tenants renting under short-term tenancies.”

It is clear from what the parties have said to the Tribunal, and from the FTT’s decision of 29 November 2024 (paragraph 6 above), that the FTT had been in correspondence with the parties, and I infer that what has now been disclosed to the Tribunal by the appellant and the respondent was also known to the FTT.

What appears to have happened is that an application was made by the appellant, but under a different title from the one it has now, and as an association representing the leaseholders of both blocks. The form stated that the association had 22 members; how that figure was derived is not known, nor how it relates to the number of signatures on the minutes sent to the FTT with the form. The initial application did not say how many of the 198 flats involved were let to qualifying tenants. There was certainly correspondence between the parties and the FTT. If the FTT accepted what the respondent said about the number of long leaseholders in the two blocks (50 + 47, leaving aside the respondent’s assertion that the assured shorthold tenants should also be included), then clearly 22 members was insufficient to meet the statutory requirement.

The applicant now seeks recognition in relation to Sleaford House only, and says there were 39 qualifying tenants in Sleaford House alone. That too is problematic; there is no justification for excluding corporate long lessees from the count of qualifying tenants, as the appellant itself says it has done, so its count of 39 is incorrect on its own account. But in any event there is nothing in the documents before the Tribunal to indicate that the application was amended before the FTT reached its decision so as to seek recognition in relation to Sleaford House only. I infer that it was not, because in its refusal of permission to appeal the FTT said that approximately 20% of the qualifying tenants were members of the association; 22 is about 20% of 50 + 47, so I can infer that the FTT was still looking at both blocks.

Nor is there anything in the documents I have seen to indicate that the FTT was told that the members of the applicant were the leaseholders of 28 flats in Sleaford House alone (rather than the 19 seen in the signatures to the minutes); again, I infer that it was not because of its reference to approximately 20% participation in the refusal of permission to appeal. The appellant may well now have 28 members representing 28 long leasehold flats in Sleaford House but I have no reason to suppose that that was true in November 2024 when the FTT reached its decision, and the FTT’s decision has to be considered on the basis of the position at that date.

The FTT’s decision was given in a letter, and its reasoning is not clear on its face. But on the basis of what it appears that the FTT was told by both parties, it was correct: the application was then for recognition in relation to both blocks, for an association with 22 members; the association’s figure of 39 qualifying tenants (even if it was given to the FTT, which is not known) is incorrect on the appellant’s own account, and the FTT appears to have accepted the respondent’s figure of 97 long leaseholders in both blocks.

Whether the respondent was right that in any event assured tenants should have been included, so that in fact the number of qualifying tenants was much higher, is not clear. The statute does not define qualifying tenants as long leaseholders, but refers to the obligation of members to pay “the same costs” by way of service charge. One would need to see the relevant tenancy agreements to know whether that is the case for the assured shorthold tenants. The application is said to have been prompted by a demand for contributions to roof repairs, and it would be unusual for assured tenants to have that responsibility; hence the statement by the Leasehold Advisory Service that members of RTAs are “usually” long leaseholders. Again, on the basis of what the FTT said in its decision refusing permission to appeal, it looks as if the FTT was counting long leaseholders only.

Accordingly, on the basis that the application before it was for a certificate for an RTA for both blocks, that the association had at that time 22 members from both blocks, and that there were 97 long leasehold flats in the two blocks, the FTT’s decision was correct. Its reasoning was not set out on the face of the decision but will have been apparent to the parties and it would be disproportionate to set it aside for want of explanation. I note from the respondent’s comments in the appeal that it is willing to recognise an RTA for Sleaford House and I hope that matters can be resolved in that way.