Seeing reason

A recent Upper Tribunal ruling in a service charge dispute has implications for all cases before the Leasehold Valuation Tribunal, writes James Fieldsend.

The case of London Borough of Havering v MacDonald [2012] UKUT 154(LC) was an appeal in a service charge dispute that raised some general points about the decision making process of the Leasehold Valuation Tribunal and how that tribunal should express its decisions. In particular HHJ Walden-Smith, sitting as judge of the Upper Tribunal (Lands Chamber), addressed the important question of whether, and if so to what extent, the LVT can at the permission to appeal stage, seek to amplify the reasons given in support of its decision. 

In summary the Judge found:


1. There is a statutory requirement for both the decision and the reasons for the decision to be recorded in writing. That requirement arises in any event as an incident of the principle of natural justice.

2. Where the basis of an appeal is inadequacy of reasons, then when “appropriate” it is open to the LVT to amplify its reasons at the permission to appeal stage.

3. The reasons must have been properly in the mind of LVT at the time the decision was made and formed the basis (or at least part of the basis) for the decision being reached.

4. The power to amplify reasons does not prevent a party appealing on the basis that the very existence of the gaps in the reasoning makes the decision unlawful or that the reasons given at the permission to appeal stage cannot have been the reasons for the decision, on a proper reading of the decision. 

The Judge also took the opportunity to consider a number of important points regarding the conduct of hearings before the LVT. 

She reaffirmed:


• What had been said by the President in Arrowdale as regards the use to be made by the LVT of its “expertise” and the importance of ensuring that any “knowledge and expertise” relied upon must be raised before the parties to give them the opportunity to comment.

• The test to be applied in cases concerning the “reasonableness” of service charges: namely, whether the charge that was made was reasonable not whether there were other possible ways of charging that might have been thought better or more reasonable.

• That in such cases (where the reasonableness of service charges is in issue) it is for the tenant to advance a prima facie case that identifies the expenditure complained of and the general nature of the case, and only then is it for the landlord to establish the reasonableness of the challenged charge(s). 

• That there is no presumption for or against the reasonableness of the standard of or the costs as regards service charges; the decision on reasonableness is to be made on all available evidence.

As can be seen the judgment, although given in the context of a service charge dispute, deals with matters that are of general application to all proceedings before the LVT.

James Fieldsend is a barrister at Tanfield Chambers.  He can be contacted by This email address is being protected from spambots. You need JavaScript enabled to view it..