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AVON FREEHOLDS LTE v GARNIER [2016] UKUT 477 (LC): Challenging Amount For Retrospective Consent To Alter Flat After Payment

In this case the leaseholder had undertaken alterations to their flat without the landlords consent. Subsequently the leaseholder sought retrospective consent. The freeholder offered consent upon payment of a significant premium. The leaseholder disputed the amount and offered a lower sum but the freeholder advised they would need to take advice. Given the leaseholders sale was being delayed he responded saying “I will make the £6,200 payment now, that’s fine”. The deed was then completed. 

Thereafter the leaseholder challenged the amount of the charge. At first instance the Tribunal accepted the argument that there was no genuine agreement as the leaseholder was acting under duress due to the threat of losing his sale.  They therefore reviewed the charge and decided the amount offered by the leaseholder represented a reasonable offer and substituted that sum. The freeholder appealed.

The freeholder argued there had been an agreement compliant with the requirements of the Commonhold and Leasehold Reform Act 2002 and as a result this ousted the Tribunals jurisdiction to determine this issue. The leaseholder also sought to cross appeal alleging the freeholder was only entitled to legal and surveyors fees.

Decision

The tribunal determined that whilst mere payment was not sufficient the words used by the leaseholder “that’s fine” amounted to agreement. It did not accept the leaseholder was acting under duress. Any urgency was self inflicted by his own sale. The freeholder did not have to grant consent and it could impose a charge although if it did so any such charge must be reasonable. Therefore the Tribunal had no jurisdiction to interfere with the payment and so the cross appeal also failed as the leaseholder had agreed to pay the agreed sum.
Whilst often today leaseholders will be advised to consider paying and challenging sums later it is vita in so doing that there is no suggestion that the amounts are agreed or the Tribunals jurisdiction will be ousted.

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