2024年1月18日
RED Alert - January 2024 – 4 / 4 观点
Welcome to the first edition of RED Alert of 2024
Also featuring in this month's update:
89 Holland Park (Management) Ltd v Dell & Dell [2023] EWCA Civ 1460
The Court of Appeal considered whether costs incurred by the landlord in relation to disputes with a neighbouring landowner were recoverable as service charges under "sweeper provisions" in the tenant's lease.
89 Holland Park is a block of flats located in West London's Holland Park, the freehold of which is held by resident-owned 89 Holland Park (Management) Ltd. The building is divided into five long leasehold flats, of which the Dells are leaseholders of one.
The dispute arose regarding litigation fees in the sum of £2,763,521 incurred by the landlord in a previous dispute with the next-door neighbour, architect Sophie Hicks, in relation to her plans to redevelop land adjoining the premises. The landlord sought to recover a contribution to these litigation and planning costs from the various leaseholders via the service charge.
The landlord relied on the following service charge provisions of the lease:
The First Tier Tribunal initially held that the service charges were recoverable. However, this was overturned on appeal in the Upper Tribunal and the landlord again appealed to the Court of Appeal.
At the Court of Appeal, the landlord relied additionally on the definition of "General Expenditure" in the lease as permitting recovery of the disputed costs, being:
“‘General Expenditure’ means the total expenditure … incurred by the Lessor in any Accounting Period in carrying out her obligations under Clause 4(4) of this Lease and any other costs and expenses reasonably and properly incurred in connection with the Building including without prejudice to the generality of the foregoing…”
The Court of Appeal dismissed the appeal on the following basis:
Whilst the Court of Appeal accepted that this judgment does not mean that no litigation costs could ever fall within the general words of a lease, this will depend on the particular expenditure in question and must therefore be considered on a case-by-case basis.
Whilst this is not particularly helpful for landlords in terms of certainty of recovery, it is clear that this case places a limit on a landlords’ rights to use "sweeper provisions" to recover costs where these do not directly relate to the management of a building.
作者 Emma Archer